Notes to Accounts of PNB Gilts Ltd.

Mar 31, 2025

XI. Provisions, Contingent liabilities and Contingent assets

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past
event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation
and a reliable estimate can be made of the amount of the obligation. The expense relating to a provision is charged/
provided in the statement of profit and loss.

The Company does not recognize a contingent liability but discloses its existence in the financial statements
Contingent liability is disclosed in the case of:

• A present obligation arising from past events, when it is not probable that an outflow of resources will not be
required to settle the obligation

• A present obligation arising from past events, when no reliable estimate is possible

• A possible obligation arising from past events, unless the probability of outflow of resources is remote
Contingent liabilities are reviewed at each reporting date.

Contingent assets usually arise from unplanned or other unexpected events that give rise to the possibility of an
inflow of economic benefits to the entity. Contingent assets are recognized when the realization of income is virtually
certain, then the related asset is not a contingent asset and its recognition is appropriate. Contingent assets are
reviewed at each reporting date. A contingent asset is disclosed where an inflow of economic benefits is probable.

Summary of Other Accounting policies Information

la. Property, plant and equipment (PPE) and intangible assets

PPE are stated at cost (including incidental expenses directly attributable to bringing the asset to its working condition
for its intended use) less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price
and any attributable cost of bringing the asset to its working condition for its intended use.

Subsequent expenditure related to PPE is capitalized only when it is probable that future economic benefits associated
with these will flow to the Company and the cost of item can be measured reliably. Other repairs and maintenance
costs are expensed off as and when incurred.

An item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal
or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition
of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset)
is recognised in the statement of profit and loss when the asset is derecognised.

An intangible asset is recognised only when its cost can be measured reliably and it is probable that the expected
future economic benefits that are attributable to it will flow to the Company. Intangible assets acquired separately
are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any
accumulated amortisation and any accumulated impairment losses.

When the use of a property changes from Owner occupied to Investment Property , the property is reclassified as
Investment Property at its carrying amount on the date of reclassification.

lb. Investment Properties

The flats classified as Investment Property are purchased for the staff. However, in view of no requirement by the staff
members, they were given to the Parent Bank employees only for a period of 11 months with two/ more extensions.

Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition,
investment properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any.

The cost includes the cost of replacing parts and borrowing cost for long term construction projects if the recognition
criteria are met. When significant parts of the investment property are required to be replaced at intervals, the
company depreciates them separately based on their specific useful lives. All other repair and maintenance costs
are recognised in statement of profit or loss as incurred.

The company depreciates investment property over 60 years from the date of original purchase.

Though the company measures investment property using cost based measurement, the fair value of investment
property is disclosed in the Note of the financial statements where applicable.

When the use of a property changes from Investment Property to Owner occupied, the property is reclassified as
Property, Plant and Equipment at its carrying amount on the date of reclassification.

Investment properties are derecognised either when they have been disposed off or when they are permanently
withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net
disposal proceeds and the carrying amount of the asset is recognised in statement of profit or loss in the period of
derecognition.

Ic. Depreciation on Property, plant and equipment, Investment Properties and Amortization of intangible assets

The depreciation on the Property plant and equipment is calculated on a Written Down Value (WDV) basis using the
rates arrived at, based on useful lives estimated by the management, which coincides with the lives prescribed under
Schedule II of the Companies Act, 2013. Residual value of Land and Building and Vehicles is taken as 5 percent of
the original cost, whereas for assets other than those specified above the residual value is taken as Re.1.

Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there
is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an
intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected
useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered
to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The
amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss.

II. Leases

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or
contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in
exchange for consideration.

Company as a lessee:

The Company’s lease asset classes primarily consist of leases for buildings. The Company assesses whether a
contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the
right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a
contract conveys the right to control the use of an identified asset, the Company assesses whether: (i) the contract
involves the use of an identified asset (ii) the Company has substantially all of the economic benefits from use of the
asset through the period of the lease and (iii) the Company has the right to direct the use of the asset.

At the date of commencement of the lease, the Company recognizes a right-of-use asset (“ROU”) and a corresponding
lease liability for all lease arrangements in which it is a lessee, except for leases with a term of twelve months or less
(short-term leases) and low value leases. For these short-term and low value leases, the Company recognizes the
lease payments as an operating expense on a straight-line basis over the term of the lease.

Certain lease arrangements include the options to extend or terminate the lease before the end of the lease term.
ROU assets and lease liabilities includes these options when it is reasonably certain that they will be exercised.

The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted
for any lease payments made at or prior to the commencement date of the lease plus any initial direct costs less any
lease incentives. They are subsequently measured at cost less accumulated depreciation and impairment losses.

Right-of-use assets are depreciated from the commencement date on a straight-line basis over the shorter of the
lease term and useful life of the underlying asset. Right of use assets are evaluated for recoverability whenever

events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of
impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is
determined on an individual asset basis unless the asset does not generate cash flows that are largely independent
of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU)
to which the asset belongs.

The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease
payments are discounted using the Incremental borrowing rates in the lease or, if not readily determinable, using
the incremental borrowing rates in the country of domicile of these leases. Lease liabilities are remeasured with a
corresponding adjustment to the related right of use asset if the Company changes its assessment if whether it will
exercise an extension or a termination option.

Lease liability and ROU asset have been separately presented in the Balance Sheet.

Leases which have expired have not been accounted as per Ind AS 116.

The Company as a lessor

Leases for which the Company is a lessor is classified as a finance or operating lease. Whenever the terms of the
lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance
lease. All other leases are classified as operating leases.

For operating leases, rental income is recognized on a straight-line basis over the term of the relevant lease.

III. Impairment of non-financial assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any
indication exists, or when annual impairment testing for an asset is required, the company estimates the asset’s
recoverable amount. An asset‘s recoverable amount is the higher of an asset’s fair value less costs of disposal and its
value in use (i.e. the present value of the future cash flows expected to be derived from an asset or cash generating
unit). The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows
that are largely independent of those from other assets or Company of assets. When the carrying amount of an asset
exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
Impairment loss, if any, will be charged to statement of profit and loss, unless the asset is carried at revalued amount
in accordance with another standard. Any impairment loss of a revalued asset shall be treated as a revaluation
decrease in accordance with that other standard.

IV. Employee Benefit Expenses

Employee benefits (other than termination benefits) that are expected to be settled wholly before twelve months after
the end of the annual reporting period in which the employees render the related service are classified as short-term
employee benefits. Benefits such as salaries, wages and bonus etc.,are recognised in the statement of profit and
loss in the period in which the employee renders the related service.

Defined contribution plan

Retirement benefit in the form of provident fund is a defined contribution scheme and the contributions are charged
to the Statement of Profit and Loss of the period when the contributions to the respective funds are due. There are
no other obligations other than the contribution payable to the respective fund.

Defined benefit Plan

Leave liability is defined benefit obligation which is unfunded. The cost of providing benefits under the defined benefit
plan is determined using the projected unit credit method with actuarial valuations being carried out at each reporting
date. Gratuity under the employee group gratuity cum life insurance scheme of LIC is defined benefit obligation,
which is funded, and the cost of providing benefits under the defined benefit plan is determined using the projected
unit credit method provided by LIC.

Post-Retirement Medical Benefit expense is borne by the company for all the superannuated employees who have
served the company for a minimum of ten years and their spouses. The cost of providing such benefits is determined
using the projected unit credit method with actuarial valuations being carried out at each reporting date.

Re-measurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts
included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in
net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding
debit or credit to retained earnings through other comprehensive income (OCI) in the period in which they occur. Re¬
measurements are not reclassified to profit or loss in subsequent periods.Past service costs are recognised in profit
or loss on the earlier of:

i. The date of the plan amendment or curtailment, and

ii. The date that the Company recognises related restructuring costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Company
recognises the following changes in the net defined benefit obligation as an expense in the statement of profit and
loss:

i. Service costs comprising current service costs, past-service costs, gains and losses on curtailments and
non-routine settlements; and

ii. Net interest expense or income

V. Statement of Cash flow

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effect of transactions
of a non cash nature, any deferral or accruals of past and future operating cash receipts or payments and items of
income associated with investing or financing cash flows.

VI. Dividend to share holders

The Company recognises a liability to make cash distributions to equity holders when the distribution is authorised
and the distribution is no longer at the discretion of the Company. As per the corporate laws in India, a distribution is
authorised when it is approved by the shareholders. A corresponding amount is recognised directly in equity.

VII. Corporate Social Responsibility (''CSR'') expenditure

The Company charges its CSR expenditure during the year to the statement of profit and loss.

VIII. Significant Judgement and Estimates

The preparation of the financial statements in conformity with Indian Accounting Standards (''Ind AS) requires the
management to make estimates, judgements and assumptions. These estimates, judgements and assumptions
affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the year. Accounting estimates could change from period to period. Actual results could differ
from those estimates. Revisions to accounting estimates are recognised prospectively. The Management believes
that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could
differ due to these estimates and the differences between the actual results and the estimates are recognised in the
periods in which the results are known / materialise. Some of the areas involving significant estimation / judgement
are determination of Expected Credit Loss, Fair valuation of Investments, Income taxes and Employee benefits.

IX. Prior Period Items

The prior period items are identified as those that result from errors or omissions in the financial statements of
previous periods. The material prior period items shall be corrected retrospectively in the financial statements.

An item from the prior period will be considered material if it constitutes 2% of the main expense/ income head
respectively as per Statement of Profit & Loss of the last audited financial statements to which it pertains.

^A As at 31st March, 2025, Rs. 13.00 lacs are in the joint name of the company with NSEIL and Rs. 20,000 lacs
pledged with PNB against which overdraft facility is taken, hence not freely available for use of the company.

# As at 31 March, 2024, Rs. 2469.60 lacs have been lien for Initial Public Offer of SRM Contractors Limited

a As at 31st March, 2024, Rs. 13.00 lacs are in the joint name of the company with NSEIL hence not freely available
for use of the company.

Note 5: Derivative financial instruments

The company enters into derivatives for risk management purposes and trading purposes. The notional amounts
indicate the value of transactions outstanding at the year end and are not indicative of either the market risk or credit
risk. The table below shows the fair values of derivative financial instruments recorded as assets or liabilities together
with their notional amounts. For management of risks, see note 41.

The Company is providing custodian services to its constituents and total holdings of 94 (P.Y. 93) constituents in
government securities as at 31st March, 2025 in SGL II with RBI is Rs. 84,80,594.80 lacs (P.Y. Rs. 87,18,875.40
lacs)

(#) The Portfolio (Government Security) measured at amortised cost is as per the Company business model to hold
Investment in order to collect contractual cash flows as per the contractual terms that give rise on specified dates to
cash flows that are solely payment of principal and interest (‘SPPI’) on the principal amount outstanding.

Accordingly, the company has classified Government Securities of Rs. 1,05,151.30 lacs.(P.Y 2,46,628.93 lacs) at
amortized cost out of the total investment out of which the interest accrued on the same is Rs.1,932.90 lacs (P.Y.
3929.14 lacs) during the year ended March 31,2025. If the company would have classified these investments under
the fair value through profit and loss (FVTPL) category, the MTM impact on the Statement of Profit and Loss would
be Rs 1169.52 lacs (P.Y 7262.76 lacs).

(a) the principal amount and the interest due thereon remaining unpaid to any supplier at the end of each accounting
year.-NIL (P.Y.-NIL)

(b) the amount of interest paid by the buyer in terms of section 16 of the Micro, Small and Medium Enterprises
Development Act, 2006, alongwith the amount of the payment made to the supplier beyond the appointed day
during each accounting year.-NIL (P.Y.-NIL)

(c ) the amount of interest due and payable for the period of delay in making payment (which have been paid but
beyond the appointed day during the year) but without adding the interest specified under the Micro, Small and
Medium Enterprises Development Act, 2006; -NIL (PY-NIL)

(d) the amount of interest accrued and remaining unpaid at the end of each accounting year;-NIL (P.Y. NIL) and

(e) the amount of further interest remaining due and payable even in the succeeding years, until such date when
the interest dues above are actually paid to the small enterprise, for the purpose of disallowance of a deductible
expenditure under section 23 of the Micro, Small and Medium Enterprises Development Act, 2006.-NIL (P.Y.
NIL)

1 All the borrowings are of short term in nature and are repayable within 12 months with a fixed rate of interest.
There is no default as on the balance sheet date in repayment of borrowings and interest thereon.

2 During the year, Net Average and Peak borrowings in Call money amounted to Rs. 2,27,619 lacs and Rs.
3,54,665 lacs respectively(Previous year 2024 Net Average and Peak borrowings - Rs. 2,30,737.52 lacs and Rs.
3,79,810.00 lacs respectively). For the year 2025, average and peak leverage ratio stands at 14.09 and 18.05
respectively (Previous year 2024 average and peak leverage ratio stands at 15.89 and 18.69 respectively).

3 Pledge of Security Face Value for FY ended 2024-2025- Rs. 5,34,426.80 lacs and Book Value Rs. 5,26,496.23
lacs - (Pledge of Security Face Value for Previous Year 2024- Rs. 2,87,200.50 lacs and Book value
Rs. 2,66,397.03 lacs).

4 Pledge of Security Face Value for FY ended 2024-2025- Rs. 4,56,366 lacs and Book value- Rs. 4,56,903.06
lacs(Pledge of security Face Value for Previous Year 2024-Rs. 67,921 lacs and Book value Rs.67,070.84 lacs).

5 Pledge of Security Face Value for FY ended 2024-2025- Rs. 8,47,982.00 lacs and Book value Rs. 8,44,158.21
lacs (Pledge of security Face Value for Previous Year 2024- Rs. 16,22,957.00 lacs and Book value
Rs. 15,78,659.88 lacs).

6 Pledge of Security Face Value for FY ended 2024-2025- Rs. 25100 lacs and Book Value- Rs. 25534.47
lacs(Pledge of security Face Value for Previous Year 2024-Rs. 19000.00 lacs and Book value Rs.19147.49
lacs).

Rights, preferences and restrictions attaching to each class of shares including restrictions on the
distribution of dividends and the repayment of capital:

The company has only one class of shares having a par values of Rs. 10 per share. Each holder of equity shares
is entitled to one vote per share. Dividend distribution is for all equity shareholders who are eligible for dividend as
on record date. In the event of liquidation of the company, the holders of equity shares will be entitled to receive
remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion
to the number of equity shares held by the shareholders.

Shares reserved for issue under options and contracts/commitments for the sale of shares/disinvestment,
including the terms and amounts : NIL (Previous Year : NIL).

For the periods of five years immediately preceding the date as at which the Balance Sheet is prepared:

a. Aggregate number and class of shares allotted as fully paid pursuant to contracts(s) without payment
being received in cash : NIL (Previous year: NIL).

b. Aggregate number and class of shares allotted as fully paid -up by way of bonus shares is: The Company
issued bonus shares in August, 1999 and number of equity shares issued as bonus were 2,50,00,000 and in July,
2013 and the number of equity shares issued as bonus were 4,49,92,534. Aggregate of equity shares issued as
bonus shares are 6,99,92,534. During current year, equity shares issued as bonus shares NIL (Previous Year: NIL).

c. Aggregate number and class of shares bought back: NIL (Previous year : Nil)

Terms of any securities convertible into equity shares issued along with the earliest date of conversion in
descending order starting from farthest such date: Nil (Previous Year : Nil)

Calls unpaid (showing aggregate value of calls unpaid by directors and officers): Nil (Previous Year : NIL)
Forfeited Shares (amount originally paid up) : NIL (Previous Year : Nil)

- A sum of Rs.4660.61 lacs (P.Y. 2024 Rs.1388.21 lacs) (20 per cent of Profit After Tax) has been transferred to
Statutory Reserve Fund as per RBI Guidelines. The same is not free for distribution of dividend.

- Market Fluctuation Reserve - For the financial year 2024-25, Board of Directors had decided not to appropriate any
amount to this reserve and the balance outstanding as on 31st March, 2025 in this reserve is Rs.6300 lacs (P.Y.
2024 Rs.6300 lacs). The same is not free for distribution of dividend.

- The Board of Directors have recommended a final dividend of Re.1 per equity share( P.Y. Re. 1/sh) amounting to
Rs.1800.10 lacs for FY 24-25 (P.Y. 1800.00 lacs) after the balance sheet date. The same is subject to approval by
the shareholders at the ensuing Annual General Meeting of the company and therefore proposed final dividend of
Rs. 1800.10 lacs (P.Y. Rs. 1800.00 lacs) has not been recognised as a liability as at the balance sheet date.

- The company has made a policy choice to recognise the effect of Taxation Laws Amendment Ordinance 2019 (''the
Ordinance'') for the financial year ended 31st March, 2025. Accordingly, the effective tax rate for the FY ended 24¬
25 is 25.168%.

Nature and purpose of reserves:

(a) Statutory reserve - Statutory reserve is created pursuant to section 45-IC of Reserve Bank of India Act. 1934.
Company shall transfer therein a sum not less than 20% of its net profit every year as disclosed in the Statement
of profit and loss and before any dividend is declared. No appropriation of any sum from the reserve fund shall
be made by the Company except for the purpose as may be specified by RBI.

(b) Securities premium - Securities premium is used to record the premium on issue of shares. The reserve can
be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the
Companies Act, 2013.

(c) General reserve - General reserves are the free reserves of the Company which are kept aside out of company’s
profits to meet future obligations. General reserves is a free reserve which can be utilised for any purpose after
fulfilling certain conditions. No amount has been transferred to general reserve during the year ended 31st
March, 2025 and 31st March, 2024.

(d) Capital reserve - Capital reserve represents the amount of net profit (after tax) through sale of securities from
HTM category of investments maintained as per earlier RBI guidelines. The same will be utilized as per the
regulatory guidelines and is not free for distribution of dividend.

(e) Market fluctuation reserve - The Board of Directors, in its meeting held on January 9, 2003, had decided to
build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company.
At the time of adoption of annual accounts each year, the Board may decide the quantum of amount to be
transferred to this Reserve, if necessary. The same is not free for distribution of dividend.

(f) Retained Earnings - These represent the surplus in the statement of profit and loss and is free for distribution of dividend.

An amount of Rs. 2667.17 lacs on account of investment and interest accrued was written off from the books of
accounts in respect of 9.60% SREI Equipment Finance Limited DB 25-05-2028 in FY 21-22. However, in the current
FY 24-25 an amount of Rs. 69.19 lacs (P.Y. Rs. 267.60 lacs) has been received. Also, an amount of Rs. 9.09 lacs
received on 17.04.2025 has been accounted in the current financial year aligning with Ind AS 10- Events after the
Balance Sheet Date. Till date a total of Rs. 345.88 lacs has been received.

#3

An amount of Rs. 100.00 lacs was received during the current FY (P.Y. Rs. 100 lacs) from Madhavpura Mercantile
Cooperative Bank Limited (MMCBL) under liquidation proceedings to whom Rs. 1000.00 lacs was lent in call money
in the year 2001. An amount of Rs. 761.88 lacs was to be received from MMCBL and the same was written off from
the books in the year 2016. Till date the total amount received from MMCBL is Rs. 412.00 lacs

Note 32: Earnings Per Equity Share (EPS)

Basic earnings per share is calculated by dividing the net profit for the year attributable to equity holders of Company
by the weighted average number of equity shares outstanding during the year.

Diluted EPS is calculated by dividing the net profit attributable to equity holders of Company after adjusting for the
effect of dilution, by the weighted average number of equity shares outstanding during the year plus the weighted
average number of equity shares that would be issued on the conversion of all the dilutive potential ordinary shares
into equity shares.

Note 34

1. FVTPL financial assets

Ind AS requires FVTPL investments to be measured at fair value and account for both depreciation and appreciation
in fair value.

2. Derivative adjustment

Under Ind AS all the Derivatives contracts (Hedging as well as Trading purpose) are measured at Fair value and both
depreciation as well as appreciation will be accounted for.

Also, Credit Value Adjustment has been recorded under Ind AS for outstanding derivative liabilities under Ind AS.

3 Fair value of Staff loans

Under Ind AS loans are fair valued and the difference between Fair value and nominal value is recognized as
employee cost. This benefit is passed over the tenure of the loan and not on origination, so employee cost would
be deferred over the tenure of the loan/ remaining service period whichever is shorter. Also interest income is
redetermined by the market rate and the differential amount is charged under Interest income.

4 Defined benefit liabilities

Under Ind AS, remeasurements [comprising of actuarial gains and losses, the effect of the asset ceiling, excluding
amounts included in net interest on the net defined benefit liability and the return on plan assets excluding amounts
included in net interest on the net defined benefit liability] are recognised immediately in the balance sheet with a
corresponding debit or credit to retained earnings through OCI.

5. Amortised Cost Financial Assets

Under this category, Ind AS requires it to be measured as per Effective Interest Rate Method and no mark to market
needs to be done.

6. Company''s consultants:

Tax Consultant- KYSB and Associates
Actuary-Sodhi Tripathi Actuaries and Consultants LLP
GST Consultant- A.K. Batra and Associates

The above contingent liabilities will be increased by the interest payable for delay in payment and penalties, if any.
The amount is not quantified.

The company has assessed the uncertain tax positions and concluded that there is no any such position which
requires disclosure as a contingent liability.

Note 39: Segment Information

The company has been granted the License of NBFC by the Reserve Bank of India and working as a Standalone
Primary Dealer.The Company''s primary activities entail supporting government borrowing program via underwriting
of government securities issuances and trade in a gamut of fixed income instruments such as Government
securities, Treasury Bills, State Development Loans, Corporate Bonds, Interest Rate Swaps and various money
market instruments such as Certificates of Deposits, Commercial Papers etc. This is the only activity performed and
is thus also the main source of risks and returns. The Company’s segments as reviewed by the Chief Operating
Decision Maker (CODM)/ Management, does not result into identification of different ways/ sources into which they
see the performance of the Company. Accordingly, the company has a single reportable and geographical segment
i.e Treasury operations and operating in India respectively. Hence, the relevant disclosures as per Ind AS 108,
Operating Segments are not applicable to the company.

Note 41: Risk Management
Introduction and risk profile

The company is primarily a dealer in debt and money market instruments. In view of the intrinsic nature of operations,
the company is exposed to a variety of risks, which can be broadly classified into credit risk, market risk and liquidity
risk. It is also subject to various regulatory risks and operational risks. Well-established systems and procedures
provide adequate defense against the regulatory and operational risk.

Risk management struture and policies

In terms of RBI guidelines for NBFCs, the Risk Management Committee, has been entrusted with the responsibility
by the Board in laying down procedures for risk assessment and minimization. The Committee also reviews these
procedures periodically to ensure that executive management is implementing and controlling the risks through means
of a properly defined risk framework. Risk Management Policy is reviewed by the Risk Management Committee and
on the basis of the Committee’s recommendation, the Board approves the same. PVBP (Price value of a basis point)
limit on the entire marked to market portfolio stands at 0.50% of audited NOF or quarter end NOF (whichever is
lower) . The one day VaR limit stands at 7.5% of audited NOF or quarter end NOF (whichever is lower) on the entire
marked to market portfolio. Leverage limit stands at 20 times quarter end Board approved NOF, while Non banker
borrowing limit stands at Rs. 25,000 crore.

(A) Liquidity risk

Liquidity risk is defined as the risk that the Company will encounter difficulty in meeting obligations associated with
financial liabilities that are settled by delivering cash or another financial asset. Liquidity risk arises because of
the possibility that the Company might be unable to meet its payment obligations when they fall due as a result of
mismatches in the timing of the cash flows under both normal and stress circumstances.

The Company manages its liquidity requirement by analysing the maturity pattern of Company''s cash flows of financial
assets and financial liabilities. The Asset Liability Management of the Company is periodically reviewed by the Board.

The Liquidity Coverage Ratio (LCR) as on 31.03.2025 is 62.66 (P.Y. 65.41). This ratio is not applicable on Primary
Dealers. The LCR is calculated by dividing High-Quality Liquid assets (HQLA) by its total net cash flows over a 30
day stress period.

The table below summarises the maturity profile of the undiscounted cash flows of the Company’s financial liabilities
as at 31st March, 2025:

(B) Credit Risk

Credit risk is the risk that the Company will incur a loss because its customers or counterparties fail to discharge their
contractual obligations. Counterparty exposure limits and instrument-wise exposure limits are the primary tools used
for managing the credit risk in the business. The company uses the Current Exposure (CE) method for calculating
credit exposure on derivative transactions as mentioned in RBI’s capital adequacy guidelines for Primary Dealer’s.

Analysis of risk concentration

In terms of paragraph 18 of the RBI notification DNBS (PD) CC No.178/03.02.001/2010-11 dated 1st July 2010, all
the non-deposit taking non-banking financial companies shall adhere to the specific regulations limiting concentration
in credit / investment to a single borrower or group of borrowers in a company. However, these concentration/ceilings
would not be applicable where principal and interest are fully guaranteed by the Government of India. The maximum
credit exposure, to any single borrower or counterparty was Rs. 31,500.00 lacs (P.Y. 2024 Rs.30,000.00 lacs) and
to single group of borrower or counterparty was Rs. 45,570.00 lacs (P.Y. 2024 Rs. 35,900.00 lacs), before and after
taking into account collateral or other credit enhancements.

There has not been any breach in extant exposure norms limit in terms with Master Direction-Standalone Primary
Dealers (Reserve Bank) Directions, 2016 (RBI/DNBR/2016-17/42 Master Direction DNBR.PD.004/03.10.119/2016-
17.

(C) Market Risk

Market risk is the risk that the fair value or future cash flows of financial instruments will fluctuate due to changes in
market variables such as interest rates and equity prices. Value-at-Risk (VaR), Price Value of a Basis Point (PVBP)
limits, sensitivity analysis and cut-loss policies form the core of market risk management system. Impact of interest
rate movements on the business and earnings profile, is mitigated by operating within a well-defined proactive stop
loss limit and value-at-risk (VaR) limit. The company also conducts sensitivity analysis of its portfolio to assess
impact of parallel and non-parallel shifts in the yield curve on its earnings profile. Risk concentrations are restricted
with specific limits mentioned above.

Market risk - trading

Internal Value-At-Risk model( VaR model) is performed to compute the market risk of trading portfolio. For computing
market risk, the Company uses the historical simulation non-parametric approach. Under this approach, the risk
measure is an estimate of the amount that could be lost on trading portfolio in a 1 day holding period due to general
market movements such as Interest rate risk, Spread risk, price risk etc over 250 trading days, at 99% confidence
level.

Objective

Historical Simulation is the procedure for predicting value at risk (VaR) by “simulating” or constructing the cumulative
distribution function of asset returns over time. It does not require any statistical assumption beyond stationarity of
the distribution of returns or, in particular, their volatility.

Limitation:

The limitation of the historical simulation lies in its I.I.D. (independent, identically distributed ) assumption of returns.
From empirical evidence, it is known that asset returns are clearly not independent as they exhibit certain patterns
such as volatility clustering. Unfortunately historical Simulation does not take into account such patterns.

I. Random chance (a very low probability event).

II. Markets moved by more than the likely prediction of the model (i.e. volatility was significantly higher than expected).

III. Markets did not move together as expected (i.e. correlations were significantly different than what was assumed
by the model).

Back testing

It is the Company’s policy to perform regular back-testing to validate the Company’s VaR calculations. When back¬
testing, the Company compares daily profits and losses with the estimates derived from the Company’s VaR model.
The Company presents the results of back-testing to the RBI quarterly.

During 2024-25, the Company recorded two back-testing exceptions (2023-24: one exception), when hypothetical
losses exceeded one day VaR limit and no back testing exceptions on comparison of actual losses with one day VaR.

Market risk - Non trading

Interest rate risk

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values
of financial instruments. The Company have fixed rate bank deposits, non traded govt securities and borrowings and
hence not exposed to interest rate risk as far as these financial instruments are concerned.

Note 42 Fair value measurement

42.1 Valuation principles

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in
the principal (or most advantageous) market at the measurement date under current market conditions (i.e., an exit
price), regardless of whether that price is directly/ indirectly observable or estimated using a valuation technique.

In order to show how fair values have been derived, financial instruments are classified based on a hierarchy of
valuation techniques.

42.2 Valuation governance

The Company''s fair value methodology and the governance over its models includes a number of controls and
other procedures to ensure appropriate safeguards are in place to ensure its quality and adequacy. All new product
initiatives (including their valuation methodologies) are subject to approvals by the management. The responsibility
of ongoing measurement resides with the risk department.

Government Securities (Central Government Securities and State Government Securities)

Government securities are financial instruments issued by Central and State Govenments. The valuation under this
category is done on the basis of prices provided by Financial Benchmarks India Private Limited (FBIL) and hence
classified as level 2.

Treasury Bills (T-Bills)

Treasury Bills are short-term financial instruments issued by sovereign governments. FBIL has developed the FBIL-
TBILL, a benchmark for the money market based on Treasury bills traded in the market. FBIL-TBILL is announced for
fourteen tenors of 7 days, 14 days, 1 month, 2 months, 3 months, 4 month, 5 months, 6 months, 7 months, 8 months,
9 months, 10 months, 11 months and 12 months. FBIL-TBILL is calculated on the basis of secondary market trades
executed. For Valuation, company use FBIL-TBILL benchmark and based on that benchmark company interpolate
and calculate T-Bills prices corresponding to there residual maturities and are classified as Level 2.

Certificate of Deposits (CD)

Certificate of Deposits are short-term financial instruments issued by Banks. FBIL has developed the FBIL- CD,
a new benchmark for the money market based on traded CDs reported on the FIMMDA Trade Reporting and
Confirmation System (FTRAC) platform of CCIL. FBIL-CD is announced for seven tenors of 14 days, 1 month, 2
months, 3 months, 6 months, 9 months and 12 months. For Valuation, company use FBIL-CD benchmark and based
on that benchmark company interpolate and calculate CD prices corresponding to there residual maturities and are
classified as Level 2.

Commercial Papers (CP)

Commercial Paper is a monetary instrument issued by corporate bodies in the nature of promissory note. The issue
of commercial papers is highly regulated and supervised by the Reserve Bank of India (RBI). Commercial Papers are
reported on the FIMMDA Trade Reporting and Confirmation System (FTRAC) platform. As currently, CP curve is not
published by FBIL/FIMMDA till then for valuation, company shall use market observable spread over T-Bill curve and
based on that new benchmark ( T-Bill constant Spread across the curve) company shall interpolate and calculate
CP prices corresponding to the residual maturities. Investments in CPs shall be classified as Level 2.

Corporate bonds and debentures

Whilst most of these instruments are standard fixed or floating rate securities, some may have more complex coupon
or embedded derivative characteristics. For valuation, Company uses FIMMDA provided SLV valuation for plain

vanilla bonds as well as FIMMDA provided last 15 days market prices when available, or other observable inputs
(i.e. FIMMDA credit spread matrix and G-sec par curve) in discounted cash flow models . As corporate bonds and
debenture fair valuations are based on the FIMMDA methodology, either directly (i.e. as prices) or indirectly (i.e.
derived from related curve and spread), such instruments are classified as Level 2.

Equity instruments

The equity instruments are actively traded on public stock exchanges with readily available active prices on a regular
basis. Such instruments are classified as Level 1. All the company''s equity instruments are traded ones.

Mutual Funds

Units held in Liquid debt mutual funds are valued based on their AMFI published net asset value (NAV), such
instruments are classified under Level 1.

Exchange traded derivative

These derivative instruments are actively traded on public stock exchanges with readily available active prices on a
regular basis. Such instruments are classified as Level 1. All the company''s exchange traded derivatives are traded
ones.

Interest rate derivatives

Interest rate derivatives include interest rate swaps. The most frequently applied valuation techniques include forward
pricing and swap models, using present value calculations by estimating future cash flows and discounting them with
the appropriate yield curves incorporating funding costs relevant for the position. These contracts are generally Level
2 unless adjustments to yield curves or credit spreads are based on significant non-observable inputs, in which case,
they are Level 3. Company is having all the Level 2 interest rate derivatives.

42.5 There have been no transfers between Level 1, Level 2 and Level 3 for the year ended 31st March, 2025 and
31st March, 2024.

42.6 Valuation adjustments

Credit and Debit valuation adjustments (CVA/DVA)

The Company calculates CVA/DVA on a counterparty basis over the entire life of the exposure. CVA is calculated by
multiplying the probability of default (PD), the loss given default (LGD) and the expected exposure (EE) at the time
of default.

A Debit valuation adjustment (DVA) is applied to incorporate the company''s own credit risk in the fair value of
derivatives (i.e., the risk that the company might default on its contractual obligations), using the same methodology
as for CVA (i.e., applying the company''s PD and multiplying it with LGD and EE).

The Company applies CVA and DVA to all relevant (not fully collateralised) over-the-counter positions with the
exception of positions settled through central clearing houses. During the FY 2024-25, there was no over the counter
position in the derivative segment. Hence, CVA and DVA have not been calculated for this financial year.

42.7 Impact of valuation adjustments

The following table shows the amount recorded in the statement of profit and loss:

Below are the methodologies and assumptions used to determine fair values for the above financial instruments
which are not recorded and measured at fair value in the Company''s financial statements. These fair values were
calculated for disclosure purposes only. The below methodologies and assumptions relate only to the instruments
in the above tables

Short-term financial assets and liabilities

For financial assets and financial liabilities that have a short-term maturity (less than twelve months), the carrying
amounts, which are net of impairment, are a reasonable approximation of their fair value. Such instruments include:
cash and cash equivalents, balances other than cash and cash equivalents, loans, other financial assets, trade
payables, Short term borrowings and other financial liabilities .

Financial asset at amortised cost

These includes staff loans . The carrying amount of such loans after applying Effective Interest Rate are a reasonable
approximation of their fair value.

Government Securities (Central Government Securities and State Government Securities)

Government securities are financial instruments issued by Central and State Govenments. The valuation under this
category is done on the basis of prices provided by Financial Benchmarks India Private Limited (FBIL).

Qualitative Disclosure on risk exposure in derivatives

Company has a board approved business policy which acts as an exhaustive document comprising of various
regulatory and risk limits. Derivatives’ trading is guided by this document and is conducted under the ambit of the
policies defined in this document.

The company follows a strict segregation of functional duties across departments. As a consequence, no single
individual shall be in a position to consummate (dealing, settlement, valuation and accounting) a derivatives
transaction alone by himself/herself.

The Company measures and monitors risk of its derivatives portfolio using risk metrics such as Value at Risk (VAR),
PVBP and position limits. Mid-office calculates and monitors risk management parameters on daily basis and ensures
compliance with the policy limits.

Over the counter (OTC) derivative transactions are covered under International Swaps and Derivatives Association
(ISDA) master agreements with the respective counter parties for credit risk mitigation.

Quantitative Disclosures of Interest Rate Futures and Currency Derivatives for Financial Year 2024-25 are
as under:

*There is no asset creation in the books of accounts

^ARs. 111.98 lacs paid to Indian Cancer Society and Rs. 87.00 lacs to The Rotary Club of Bombay Pier Charities Trust
out of unspent amount of FY 23-24 in FY 24-25.

# Rs. 8.80 lacs spent for maintenance cost for FY 24-25 for I am Gurgaon out of unspent amount of FY 22-23.

$ Surplus income of Rs. 1.12 lacs arising from this project is also utilized in the same project.

c) Shortfall at the year-end: NA

d) Total of Previous Year shortfall: Rs. 198.98 lacs

e) Reason for shortfall: (FY 2024-25: Nil)

FY 2023-24-Rs. 111.98 lacs remained unspent by Indian Cancer Society due to unforeseen complications
arisen with unavailability of women in strength in screening camps and delayed start of the project.

For project of Rotary Foundation, Rs. 87 lacs lacs remained unspent due to operational changes in implementing
partner from Rotary Foundation (India) to the Rotary Club of Bombay Pier Charities Trust as on 31.03.2024

f) Nature of CSR activities: Promotion of healthcare including preventive healthcare and sanitation and environment
sustainability and contribution to PM National Relief Funds

g) Details of related party transactions, e.g., contribution to a trust controlled by the company in relation to CSR
expenditure as per relevant Accounting Standard: Not Applicable

Where a provision is made with respect to a liability incurred by entering into a contractual obligation, the
movements in the provision during the year should be shown separately: Not Applicable

NOTE 66: Subsequent Events

There is no subsequent event after the reporting date till the date of approval of the financial statements, which may
impact the financial statements of the company except an amount of Rs. 9.09 lacs was received on 17^th April 2025
from SREI Equipments Finance Limited written off in FY 2021-22.

Figures of the previous period have been regrouped, wherever considered necessary in order to make them
comparable with those of the current period.

For and on behalf of the Board

r _ I

(Kalyan Kumar) (Gopal Singh Gusain)

Director Director

DIN: 09631251 DIN: 03522170

(C.A. Chandra Prakash) (Monika Kochar)

CFO Company Secretary

Membership No. 415359 Membership No. F6514

In terms of our report of even date
For Batra Deepak & Associates

Chartered Accountants
(FRN: 005408C)

y''

Date: May 02, 2025 (CA. Ashish Mittal)

Place : New Delhi Partner

Regd off : 5, Sansad Marg, Membership No. 511442

New Delhi - 110001

---

Mar 31, 2024

XI. Provisions, Contingent liabilities and Contingent assets

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. The expense relating to a provision is charged/provided in the statement of profit and loss.

The Company does not recognize a contingent liability but discloses its existence in the financial statements Contingent liability is disclosed in the case of:

• A present obligation arising from past events, when it is not probable that an outflow of resources will not be required to settle the obligation

• A present obligation arising from past events, when no reliable estimate is possible

• A possible obligation arising from past events, unless the probability of outflow of resources is remote Contingent liabilities are reviewed at each reporting date.

Contingent assets usually arise from unplanned or other unexpected events that give rise to the possibility of an inflow of economic benefits to the entity. Contingent assets are recognized when the realization of income is virtually certain, then the related asset is not a contingent asset and its recognition is appropriate. Contingent assets are reviewed at each reporting date. A contingent asset is disclosed where an inflow of economic benefits is probable.

Summary of Other Accounting policies Information

la. Property, plant and equipment (PPE) and intangible assets

PPE are stated at cost (including incidental expenses directly attributable to bringing the asset to its working condition for its intended use) less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

Subsequent expenditure related to PPE is capitalized only when it is probable that future economic benefits associated with these will flow to the Company and the cost of item can be measured reliably. Other repairs and maintenance costs are expensed off as and when incurred.

An item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is recognised in the statement of profit and loss when the asset is derecognised.

An intangible asset is recognised only when its cost can be measured reliably and it is probable that the expected future economic benefits that are attributable to it will flow to the Company. Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses.

lb. Investment Properties

The flats classified as Investment Property are purchased for the staff. However, in view of no requirement by the staff members, they are given to the PNB employees only for a period of 11 months with two/ more extensions.

Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any.

The cost includes the cost of replacing parts and borrowing cost for long term construction projects if the recognition

criteria are met. When significant parts of the investment property are required to be replaced at intervals, the company depreciates them separately based on their specific useful lives. All other repair and maintenance costs are recognised in statement of profit or loss as incurred.

The company depreciates investment property over 60 years from the date of original purchase.

Though the company measures investment property using cost based measurement, the fair value of investment property is disclosed in the Note 12A of the financial statements.

Investment properties are derecognised either when they have been disposed off or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in statement of profit or loss in the period of derecognition.

Ic. Depreciation on Property, plant and equipment, Investment Properties and Amortization of intangible assets

The depreciation on the Property plant and equipment is calculated on a Written Down Value (WDV) basis using the rates arrived at, based on useful lives estimated by the management, which coincides with the lives prescribed under Schedule II of the Companies Act, 2013. Residual value of Land and Building and Vehicles is taken as 5 percent of the original cost, whereas for assets other than those specified above the residual value is taken as Re.1.

Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss.

II. Leases

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Company as a lessee:

The Company’s lease asset classes primarily consist of leases for buildings. The Company assesses whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether: (i) the contract involves the use of an identified asset (ii) the Company has substantially all of the economic benefits from use of the asset through the period of the lease and (iii) the Company has the right to direct the use of the asset.

At the date of commencement of the lease, the Company recognizes a right-of-use asset (“ROU”) and a corresponding lease liability for all lease arrangements in which it is a lessee, except for leases with a term of twelve months or less (short-term leases) and low value leases. For these short-term and low value leases, the Company recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

Certain lease arrangements include the options to extend or terminate the lease before the end of the lease term. ROU assets and lease liabilities includes these options when it is reasonably certain that they will be exercised.

The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease incentives. They are subsequently measured at cost less accumulated depreciation and impairment losses.

Right-of-use assets are depreciated from the commencement date on a straight-line basis over the shorter of the lease term and useful life of the underlying asset. Right of use assets are evaluated for recoverability whenever

events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs.

The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease payments are discounted using the Incremental borrowing rates in the lease or, if not readily determinable, using the incremental borrowing rates in the country of domicile of these leases. Lease liabilities are remeasured with a corresponding adjustment to the related right of use asset if the Company changes its assessment if whether it will exercise an extension or a termination option.

Lease liability and ROU asset have been separately presented in the Balance Sheet.

Leases which have expired have not been accounted as per Ind AS 116.

The Company as a lessor

Leases for which the Company is a lessor is classified as a finance or operating lease. Whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases.

For operating leases, rental income is recognized on a straight-line basis over the term of the relevant lease.

III. Impairment of non-financial assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the company estimates the asset’s recoverable amount. An asset‘s recoverable amount is the higher of an asset’s fair value less costs of disposal and its value in use (i.e. the present value of the future cash flows expected to be derived from an asset or cash generating unit). The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or Company of assets. When the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. Impairment loss, if any, will be charged to statement of profit and loss, unless the asset is carried at revalued amount in accordance with another standard. Any impairment loss of a revalued asset shall be treated as a revaluation decrease in accordance with that other standard.

IV. Employee Benefit Expenses

Employee benefits (other than termination benefits) that are expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related service are classified as short-term employee benefits. Benefits such as salaries, wages and bonus etc.,are recognised in the statement of profit and loss in the period in which the employee renders the related service.

Defined contribution plan

Retirement benefit in the form of provident fund is a defined contribution scheme and the contributions are charged to the Statement of Profit and Loss of the period when the contributions to the respective funds are due. There are no other obligations other than the contribution payable to the respective fund.

Defined benefit Plan

Leave liability is defined benefit obligation which is unfunded. The cost of providing benefits under the defined benefit plan is determined using the projected unit credit method with actuarial valuations being carried out at each reporting date. Gratuity under the employee group gratuity cum life insurance scheme of LIC is defined benefit obligation which is funded and the cost of providing benefits under the defined benefit plan is determined using the projected unit credit method provided by LIC.

Re-measurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through other comprehensive income (OCI) in the period in which they occur. Re-measurements are not reclassified to profit or loss in subsequent periods.Past service costs are recognised in profit or loss on the earlier of:

i. The date of the plan amendment or curtailment, and

ii. The date that the Company recognises related restructuring costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Company recognises the following changes in the net defined benefit obligation as an expense in the statement of profit and loss:

i. Service costs comprising current service costs, past-service costs, gains and losses on curtailments and non-routine settlements; and

ii. Net interest expense or income

V. Cash flow statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effect of transactions of a non cash nature, any deferral or accruals of past and future operating cash receipts or payments and items of income associated with investing or financing cash flows.

VI. Dividend to share holders

The Company recognises a liability to make cash distributions to equity holders when the distribution is authorised and the distribution is no longer at the discretion of the Company. As per the corporate laws in India, a distribution is authorised when it is approved by the shareholders. A corresponding amount is recognised directly in equity.

VII. Corporate Social Responsibility (''CSR'') expenditure

The Company charges its CSR expenditure during the year to the statement of profit and loss.

VIII. Significant Judgement and Estimates

The preparation of the financial statements in conformity with Indian Accounting Standards (''Ind AS) requires the management to make estimates, judgements and assumptions. These estimates, judgements and assumptions affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Accounting estimates could change from period to period. Actual results could differ from those estimates. Revisions to accounting estimates are recognised prospectively. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise. Some of the areas involving significant estimation / judgement are determination of Expected Credit Loss, Fair valuation of Investments, Income taxes and Employee benefits.

Rights, preferences and restrictions attaching to each class of shares including restrictions on the distribution of dividends and the repayment of capital:

The company has only one class of shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. Dividend distribution is for all equity shareholders who are eligible for dividend as on record date. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Shares reserved for issue under options and contracts/commitments for the sale of shares/disinvestment, including the terms and amounts : NIL (Previous Year : NIL).

For the periods of five years immediately preceding the date as at which the Balance Sheet is prepared:

a. Aggregate number and class of shares allotted as fully paid pursuant to contracts(s) without payment being received in cash : NIL (Previous year: NIL).

b. Aggregate number and class of shares allotted as fully paid -up by way of bonus shares is: The Company issued bonus shares in August, 1999 and number of equity shares issued as bonus were 2,50,00,000 and in July, 2013 and the number of equity shares issued as bonus were 4,49,92,534. Aggregate of equity shares issued as bonus shares are 6,99,92,534. During current year, equity shares issued as bonus shares NIL (previous Year: NIL).

c. Aggregate number and class of shares bought back: NIL (Previous year : Nil)

Terms of any securities convertible into equity shares issued along with the earliest date of conversion in descending order starting from farthest such date: Nil (Previous Year : Nil)

Calls unpaid (showing aggregate value of calls unpaid by directors and officers): Nil (Previous Year NIL) Forfeited Shares (amount originally paid up) : NIL (Previous Year Nil)

- A sum of Rs. 1388.21 lacs (P.Y. 2023 Rs.Nil lacs) (20 per cent of Profit After Tax) has been transferred to Statutory Reserve Fund as per RBI Guidelines. The same is not free for distribution of dividend.

- Market Fluctuation Reserve - For the financial year 2023-24, Board of Directors had decided not to appropriate any amount to this reserve and the balance outstanding as on 31st March , 2024 in this reserve is Rs.6300 lacs (P.Y. 2023 Rs.6300 lacs). The same is not free for distribution of dividend.

- The Board of Directors have recommended a final dividend of Re.1 per equity share amounting to Rs.1800.00 lacs for FY 23-24 after the balance sheet date. The same is subject to approval by the shareholders at the ensuing Annual General Meeting of the company and therefore proposed final dividend of Rs.1800.00 lacs has not been recognised as a liability as at the balance sheet date. No dividend had been recommended for the previous financial year 2022-23 by the Board.

- The company has made a policy choice to recognise the effect of Taxation Laws Amendment Ordinance 2019 (''the Ordinance'') for the financial year ended 31st March, 2024. Accordingly, the effective tax rate for the FY ended 23-24 is 25.168%.

Nature and purpose of reserves:

(a) Statutory reserve- Statutory reserve is created pursuant to section 45-IC of Reserve Bank of India Act. 1934. Company shall transfer therein a sum not less than 20% of its net profit every year as disclosed in the profit and loss account and before any dividend is declared. No appropriation of any sum from the reserve fund shall be made by the Company except for the purpose as may be specified by RBI.

(b) Securities premium - Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

(c) General reserve - General reserves are the free reserves of the Company which are kept aside out of company’s profits to meet future obligations. General reserves is a free reserve which can be utilised for any purpose after fulfilling certain conditions. No amount has been transferred to general reserve during the year ended 31st March, 2024 and 31st March, 2023.

(d) Capital reserve- Capital reserve represents the amount of net profit (after tax) through sale of securities from HTM category of investments maintained as per earlier RBI guidelines. The same will be utilized as per the regulatory guidelines and is not free for distribution of dividend.

(e) Market fluctuation reserve- The Board of Directors, in its meeting held on January 9, 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company. At the time of adoption of annual accounts each year, the Board may decide the quantum of amount to be transferred to this Reserve, if necessary. The same is not free for distribution of dividend.

An amount of Rs. 2667.17 lacs on account of investment and interest accrued was written off from the books of accounts in respect of 9.60% SREI Equipment Finance Limited DB 25-05-2028 in FY 21-22. However, in the current FY 23-24 an amount of Rs. 255.67 lacs has been received (Rs. 200.62 lacs on 20.10.2023 and Rs. 55.05 lacs on 01.01.2024). Also an amount of Rs. 11.93 lacs received on 18.04.2024 has been accounted in the current financial year aligning with Ind AS 10- Events after the Balance sheet date.

#3

An amount of Rs. 100.00 lacs was received in FY 2023-24 (P.Y. RS. 100.00 lacs) from Madhavpura Mercantile Cooperative Bank Limited (MMCBL) under liquidation proceedings to whom Rs. 1000.00 lacs was lent in call money in the year 2001. An amount of Rs. 761.88 lacs was to be received from MMCBL and the same was written off from the books in the year 2016. Till current FY, total amount received from MMCBL is Rs. 312.00 lacs

#4

Certain expenses pertaining to the previous years which could not be provided for during the last year, have been booked in the current year and shown under exceptional items. As the amount is not material, retrospective effect is not taken.

Note 32: Earnings Per Share (EPS)

Basic earnings per share is calculated by dividing the net profit for the year attributable to equity holders of Company by the weighted average number of equity shares outstanding during the year.

Diluted EPS is calculated by dividing the net profit attributable to equity holders of Company after adjusting for the effect of dilution, by the weighted average number of equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on the conversion of all the dilutive potential ordinary shares into equity shares.

Note 34

1. FVTPL financial assets

Ind AS requires FVTPL investments to be measured at fair value and account for both depreciation and appreciation in fair value.

2. Derivative adjustment

Under Ind AS all the Derivatives contracts (Hedging as well as Trading purpose) are measured at Fair value and both depreciation as well as appreciation will be accounted for.

Also, Credit Value Adjustment has been recorded under Ind AS for outstanding derivative liabilites under Ind AS.

3 Fair value of Staff loans

Under Ind AS loans are fair valued and the difference between Fair value and nominal value is recognized as employee cost. This benefit is passed over the tenure of the loan and not on origination, so employee cost would be deferred over the tenure of the loan/ remaining service period whichever is shorter . Also interest income is redetermined by the market rate and the differential amount is charged under Interest income.

4. Defined benefit liabilities

Under Ind AS, remeasurements [comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets excluding amounts included in net interest on the net defined benefit liability] are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI.

5. Amortised Cost Financial Assets

Under this category, Ind AS requires it to be measured as per Effective Interest Rate Method and no mark to market needs to be done.

6. Company''s consultants:

Tax Consultant- KYSB and Associates Actuary-Sodhi Tripathi Actuaries and Consultants LLP GST Consultant- A.K. Batra and Associates

For the purpose of the Company’s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company’s capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a capital adequacy ratio, which is weighted assets divided by total capital derived as per the RBI requirements. As per the RBI guidelines, Company being a Non Banking Finance Company has to maintain 15% of capital adequacy ratio.

The company has been granted the License of NBFC by the Reserve Bank of India and working as a Standalone Primary Dealer.The Company''s primary activities entail supporting government borrowing program via underwriting of government securities issuances and trade in a gamut of fixed income instruments such as Government securities, Treasury Bills, State Development Loans, Corporate Bonds, Interest Rate Swaps and various money market instruments such as Certificates of Deposits, Commercial Papers etc. This is the only activity performed and is thus also the main source of risks and returns. The Company’s segments as reviewed by the Chief Operating Decision Maker (CODM)/ Management, does not result into identification of different ways/ sources into which they see the performance of the Company. Accordingly, the company has a single reportable and geographical segment i.e Treasury operations and operating in India respectively. Hence, the relevant disclosures as per Ind AS 108, Operating Segments are not applicable to the company.

Note 41: Risk Management Introduction and risk profile

The company is primarily a dealer in debt and money market instruments. In view of the intrinsic nature of operations, the company is exposed to a variety of risks, which can be broadly classified into credit risk, market risk and liquidity risk. It is also subject to various regulatory risks and operational risks. Well-established systems and procedures provide adequate defense against the regulatory and operational risk.

Risk management struture and policies

In terms of RBI guidelines for NBFCs, the Risk Management Committee, has been entrusted with the responsibility by the Board in laying down procedures for risk assessment and minimization. The Committee also reviews these procedures periodically to ensure that executive management is implementing and controlling the risks through means of a properly defined risk framework. Risk Management Policy is reviewed by the Risk Management Committee and on the basis of the Committee’s recommendation, the Board approves the same. PVBP (Price value of a basis point) limit on the entire marked to market portfolio stands at 0.50% of audited NOF or quarter end NOF (whichever is lower) . The one day VaR limit stands at 7.5% of audited NOF or quarter end NOF (whichever is lower) on the entire marked to market portfolio. Leverage limit stands at 20 times quarter end Board approved NOF, while Non banker borrowing limit stands at Rs. 25,000 crore.

(A) Liquidity risk

Liquidity risk is defined as the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Liquidity risk arises because of the possibility that the Company might be unable to meet its payment obligations when they fall due as a result of mismatches in the timing of the cash flows under both normal and stress circumstances.

The Company manages its liquidity requirement by analysing the maturity pattern of Company''s cash flows of financial assets and financial liabilities. The Asset Liability Management of the Company is periodically reviewed by the Board.

The Liquidity Coverage Ratio (LCR) for 23-24 is 65.41 (P.Y. 96.14). This ratio is not applicable on Primary Dealers. The LCR is calculated by dividing High-Quality Liquid assets (HQLA) by its total net cash flows over a 30 day stress period.

The table below summarises the maturity profile of the undiscounted cash flows of the Company’s financial liabilities as at 31st March, 2024:

(B) Credit Risk

Credit risk is the risk that the Company will incur a loss because its customers or counterparties fail to discharge their contractual obligations. Counterparty exposure limits and instrument-wise exposure limits are the primary tools used for managing the credit risk in the business. The company uses the Current Exposure (CE) method for calculating credit exposure on derivative transactions as mentioned in RBI’s capital adequacy guidelines for Primary Dealer’s.

Analysis of risk concentration

In terms of paragraph 18 of the RBI notification DNBS (PD) CC No.178/03.02.001/2010-11 dated 1st July 2010, all the non-deposit taking non-banking financial companies shall adhere to the specific regulations limiting concentration in credit / investment to a single borrower or group of borrowers in a company. However, these concentration/ ceilings would not be applicable where principal and interest are fully guaranteed by the Government of India. The maximum credit exposure, to any single borrower or counterparty was Rs. 30000.00 lacs (P.Y. 2023 Rs.30351.00 lacs) and to single group of borrower or counterparty was Rs.35900.00 lacs (P.Y. 2023 Rs. 45351.00 lacs), before and after taking into account collateral or other credit enhancements.

There has not been any breach in extant exposure norms limit in terms with Master Direction-Standalone Primary Dealers (Reserve Bank) Directions, 2016 (RBI/DNBR/2016-17/42 Master Direction DNBR.PD.004/03.10.119/2016-17.

(C ) Market Risk

Market risk is the risk that the fair value or future cash flows of financial instruments will fluctuate due to changes in market variables such as interest rates and equity prices. Value-at-Risk (VaR), Price Value of a Basis Point (PVBP) limits, sensitivity analysis and cut-loss policies form the core of market risk management system. Impact of interest rate movements on the business and earnings profile, is mitigated by operating within a well-defined proactive stop loss limit and value-at-risk (VaR) limit. The company also conducts sensitivity analysis of its portfolio to assess impact of parallel and non-parallel shifts in the yield curve on its earnings profile. Risk concentrations are restricted with specific limits mentioned above.

Market risk - trading

Internal Value-At-Risk model( VaR model) is performed to compute the market risk of trading portfolio. For computing market risk, the Company uses the historical simulation non-parametric approach. Under this approach, the risk measure is an estimate of the amount that could be lost on trading portfolio in a 1 day holding period due to general market movements such as Interest rate risk, Spread risk, price risk etc over 250 trading days, at 99% confidence level.

Objective

Historical Simulation is the procedure for predicting value at risk (VaR) by “simulating” or constructing the cumulative distribution function of asset returns over time. It does not require any statistical assumption beyond stationarity of the distribution of returns or, in particular, their volatility.

Limitation:

The limitation of the historical simulation lies in its I.I.D. (independent, identically distributed ) assumption of returns. From empirical evidence, it is known that asset returns are clearly not independent as they exhibit certain patterns such as volatility clustering. Unfortunately historical Simulation does not take into account such patterns.

I. Random chance (a very low probability event).

II. Markets moved by more than the likely prediction of the model (i.e. volatility was significantly higher than expected).

III. Markets did not move together as expected (i.e. correlations were significantly different than what was assumed by the model).

Market risk - Non trading Interest rate risk

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments. The Company have fixed rate bank deposits, non traded govt securities and borrowings and hence not exposed to interest rate risk as far as these financial instruments are concerned.

Note 42 Fair value measurement

42.1 Valuation principles

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e., an exit price), regardless of whether that price is directly/ indirectly observable or estimated using a valuation technique.

In order to show how fair values have been derived, financial instruments are classified based on a hierarchy of valuation techniques.

42.2 Valuation governance

The Company''s fair value methodology and the governance over its models includes a number of controls and other procedures to ensure appropriate safeguards are in place to ensure its quality and adequacy. All new product initiatives (including their valuation methodologies) are subject to approvals by the management. The responsibility of ongoing measurement resides with the risk department.

Government Securities (Central Government Securities and State Government Securities)

Government securities are financial instruments issued by Central and State Govenments. The valuation under this category is done on the basis of prices provided by Financial Benchmarks India Private Limited (FBIL) and hence classified as level 2.

Treasury Bills (T-Bills)

Treasury Bills are short-term financial instruments issued by sovereign governments. FBIL has developed the FBIL-TBILL, a benchmark for the money market based on Treasury bills traded in the market. FBIL-TBILL is announced for fourteen tenors of 7 days, 14 days, 1 month, 2 months, 3 months, 4 month, 5 months, 6 months, 7 months, 8 months, 9 months, 10 months, 11 months and 12 months. FBIL-TBILL is calculated on the basis of secondary market trades executed. For Valuation, company use FBIL-TBILL benchmark and based on that benchmark company interpolate and calculate T-Bills prices corresponding to there residual maturities and are classified as Level 2.

Certificate of Deposits (CD)

Certificate of Deposits are short-term financial instruments issued by Banks. FBIL has developed the FBIL- CD, a new benchmark for the money market based on traded CDs reported on the FIMMDA Trade Reporting and Confirmation System (FTRAC) platform of CCIL. FBIL-CD is announced for seven tenors of 14 days, 1 month, 2 months, 3 months, 6 months, 9 months and 12 months. For Valuation, company use FBIL-CD benchmark and based on that benchmark company interpolate and calculate CD prices corresponding to there residual maturities and are classified as Level 2.

Commercial Papers (CP)

Commercial Paper is a monetary instrument issued by corporate bodies in the nature of promissory note. The issue of commercial papers is highly regulated and supervised by the Reserve Bank of India (RBI). Commercial Papers are reported on the FIMMDA Trade Reporting and Confirmation System (FTRAC) platform. As currently, CP curve is not published by FBIL/FIMMDA till then for valuation, company shall use market observable spread over T-Bill curve and based on that new benchmark ( T-Bill constant Spread across the curve) company shall interpolate and calculate CP prices corresponding to the residual maturities. Investments in CPs shall be classified as Level 2.

Corporate bonds and debentures

Whilst most of these instruments are standard fixed or floating rate securities, some may have more complex coupon or embedded derivative characteristics. For valuation, Company uses FIMMDA provided SLV valuation for

plain vanilla bonds as well as FIMMDA provided last 15 days market prices when available, or other observable inputs (i.e. FIMMDA credit spread matrix and G-sec par curve) in discounted cash flow models . As corporate bonds and debenture fair valuations are based on the FIMMDA methodology, either directly (i.e. as prices) or indirectly (i.e. derived from related curve and spread), such instruments are classified as Level 2.

Equity instruments

The equity instruments are actively traded on public stock exchanges with readily available active prices on a regular basis. Such instruments are classified as Level 1. All the company''s equity instruments are traded ones.

Mutual Funds

Units held in Liquid debt mutual funds are valued based on their AMFI published net asset value (NAV), such instruments are classified under Level 1.

Exchange traded derivative

These derivative instruments are actively traded on public stock exchanges with readily available active prices on a regular basis. Such instruments are classified as Level 1. All the company''s exchange traded derivatives are traded ones.

Interest rate derivatives

Interest rate derivatives include interest rate swaps. The most frequently applied valuation techniques include forward pricing and swap models, using present value calculations by estimating future cash flows and discounting them with the appropriate yield curves incorporating funding costs relevant for the position. These contracts are generally Level 2 unless adjustments to yield curves or credit spreads are based on significant non-observable inputs, in which case, they are Level 3. Company is having all the Level 2 interest rate derivatives.

42.5 There have been no transfers between Level 1, Level 2 and Level 3 for the year ended 31st March, 2023 and 31st March, 2024.

42.6 Valuation adjustments

Credit and Debit valuation adjustments (CVA/DVA)

The Company calculates CVA/DVA on a counterparty basis over the entire life of the exposure. CVA is calculated by multiplying the probability of default (PD), the loss given default (LGD) and the expected exposure (EE) at the time of default.

A Debit valuation adjustment (DVA) is applied to incorporate the company''s own credit risk in the fair value of derivatives (i.e., the risk that the company might default on its contractual obligations), using the same methodology as for CVA (i.e., applying the company''s PD and multiplying it with LGD and EE).

The Company applies CVA and DVA to all relevant (not fully collateralised) over-the-counter positions with the exception of positions settled through central clearing houses. During the FY 2023-24, there was no over the counter position in the derivative segment. Hence, CVA and DVA have not been calculated for this financial year.

Below are the methodologies and assumptions used to determine fair values for the above financial instruments which are not recorded and measured at fair value in the Company''s financial statements. These fair values were calculated for disclosure purposes only. The below methodologies and assumptions relate only to the instruments in the above tables

Short-term financial assets and liabilities

For financial assets and financial liabilities that have a short-term maturity (less than twelve months), the carrying amounts, which are net of impairment, are a reasonable approximation of their fair value. Such instruments include: cash and cash equivalents, balances other than cash and cash equivalents, loans, other financial assets, trade payables, Short term borrowings and other financial liabilities.

Financial asset at amortised cost

These includes staff loans . The carrying amount of such loans after applying Effective Interest Rate are a reasonable approximation of their fair value.

Government Securities (Central Government Securities and State Government Securities)

Government securities are financial instruments issued by Central and State Govenments. The valuation under this category is done on the basis of prices provided by Financial Benchmarks India Private Limited (FBIL).

Figures of the previous period have been regrouped, wherever considered necessary in order to make them comparable with those of the current period.

NOTE 66: Subsequent Events

There is no subsequent event after the reporting date till the date of approval of the financial statements, which may impact the financial statements of the company except an amount of Rs. 11.93 lacs was received on 18^th April 2024 from SREI Equipments Finance Limited written off in FY 2021-22.

For and on behalf of the Board

(Kalyan Kumar) (Vikas Goel)

Director Managing Director & CEO

DIN: 09631251 DIN: 08322541

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/ s

(C.A. Chandra Prakash) (Monika Kochar)

CFO Company Secretary

Membership No. 415359 Membership No. F6514

In terms of our report of even date For Batra Deepak & Associates

Chartered Accountants (FRN: 005408C)

\jfr-

Date: May 01,2024 (CA Tarun Gupta)

Place : New Delhi Partner

Regd off : 5, Sansad Marg, Membership No. 535428

New Delhi - 110001

---

Mar 31, 2023

As at 31st March, 2023, Rs. 13.00 lakhs are in the joint name of the Company with NSEIL. Hence not freely available for use of the Company.

This also comprises of a fixed deposit of Rs. 10100.00 lakhs which is pledged with Punjab National Bank for availing Overdraft facility.

a As at 31st March, 2022, Rs. 13.00 lakhs are in the joint name of the Company with NSEIL. Hence not freely available for use of the Company.

Note 5: Derivative financial instruments Part I

The Company enters into derivatives for risk management purposes and trading purposes. The notional amounts indicate the value of transactions outstanding at the year end and are not indicative of either the market risk or credit risk. The table below shows the fair values of derivative financial instruments recorded as assets or liabilities together with their notional amounts. For management of risks, see note 40.

Part II (The information in the below section forms part of Part I above)

Hedging activities and derivatives

The Company is exposed to certain risks relating to its ongoing business operations. The primary risks managed using derivative instruments are interest rate risk.

Derivatives not designated as hedging instruments (Undesignated derivatives)

The Company uses interest rate swaps to manage its interest rate risk arising from INR denominated borrowings. The interest rate swaps are not designated in a hedging relationship and are entered into for periods consistent with exposure of the underlying transactions, generally from 6 to 36 months. Details of the derivative instruments held for hedging purpose is given below, the same are not designated as hedging instruments and therefore, hedge accounting is not done.

The Company is providing custodian services to its constituents and total holdings of 81 (P.Y. 76) constituents in government securities as at 31st March, 2023 in SGL II with RBI is Rs.86,93,110.70 lakhs (P.Y. Rs. 90,60,111.65 lakhs) (#) The Portfolio (Government Security) measured at amortised cost is as per the Company business model to hold Investment in order to collect contractual cash flows as per the contractual terms that give rise on specified dates to cash flows that are solely payment of principal and interest (‘SPPI’) on the principal amount outstanding.

Accordingly, during the year, the Company has classified Government Securities of Rs. 3,49,018.06 lakhs. (P.Y 2,10,001.96 lakhs) at amortized cost out of the total investment. The interest accrued on the same is Rs. 2,989.43 lakhs (P.Y. 3,330.91 lakhs) during the year ended March 31, 2023. If the Company would have classified these investments under the fair value through profit and loss (FVTPL) category, the MTM impact on the Statement of Profit and Loss would be Rs (-)6,975.31 lakhs (P.Y.(-)1,262.91 lakhs).

As per Ind AS 116- Leases applicable from April 01, 2019, the amount of depreciation charged on Right of Use Asset for the financial year ending March 31, 2023 amounts to Rs.34.29 lakhs (P.Y. Rs. 23.68 lakhs), amount charged as interest expense on leased liability under the Finance cost amounts to Rs.12.92 lakhs (P.Y. Rs. 5.20 lakhs) and the actual lease rent reversed from the administrative expenses for the period 22-23 amounts to Rs. 43.56 lakhs (P.Y. Rs. 27.49 lakhs). The net charge to the statement of Profit and Loss comes to Rs. 3.65 lakhs (P.Y. Rs. 2.40 lakhs). The policy relating to Leases is explained in Note 2 (II).

(a) The principal amount and the interest due thereon remaining unpaid to any supplier at the end of each accounting year.-NIL (P.Y.-NIL)

(b) The amount of interest paid by the buyer in terms of section 16 of the Micro, Small and Medium Enterprises Development Act, 2006, alongwith the amount of the payment made to the supplier beyond the appointed day during each accounting year.-NIL (P.Y.-NIL)

(c) The amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the interest specified under the Micro, Small and Medium Enterprises Development Act, 2006; -NIL (PY-NIL)

(d) The amount of interest accrued and remaining unpaid at the end of each accounting year;-NIL (P.Y. NIL) and

(e) The amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues above are actually paid to the small enterprise, for the purpose of disallowance of a deductible expenditure under section 23 of the Micro, Small and Medium Enterprises Development Act, 2006.-NIL (P.Y.

nil)

1. All the borrowings are of short term in nature and are repayable within 12 months with a fixed rate of interest. There is no default as on the balance sheet date in repayment of borrowings and interest thereon.

2. During the year 2022-23, Net Average and Peak borrowings in Call money amounted to Rs. 3,05,269.99 lakhs and Rs. 3,89,125.00 lakhs respectively(Previous year 2021-22 Net Average and Peak borrowings -Rs 2,06,450.65 lakhs and Rs. 3,84,990.00 lakhs respectively). For the year 2022-23, average and peak leverage ratio stands at 13.16 and 16.29 respectively (Previous year 2021-22 average and peak leverage ratio stands at 10.86 and 13.49 respectively).

3. Pledge of security face value for year 2022-23 -Rs. 1,40,800 lakhs and Book value Rs.1,47,348.49 lakhs (Pledge of security face value for previous Year 2021-22-Rs. Nil and Book Value Rs. Nil).

4. Pledge of security face value for year 2022-23-Rs.2,34,400 lakhs and Book value Rs.2,34,164.58 lakhs (Pledge of security face value for Previous Year 2021-22-Rs.2,09,000.00 lakhs and Book Value Rs. 2,07,782.23 lakhs).

5. Pledge of security face value for year 2022-23-Rs. 13,33,536.00 lakhs and Book value Rs. 1,340,085.81 lakhs (Pledge of security face value for Previous Year 2021-22- 8,72,141.00 lakhs and Book value Rs.8,95,883.26 lakhs).

6. Pledge of security face value for year 2022-23-Rs. 21,000.00 lakhs and Book value Rs.21,099.38 lakhs (Pledge of security face value for Previous Year 2021-22-Rs.19,500.00 lakhs and Book value Rs.19,861.60 lakhs).

Rights, preferences and restrictions attaching to each class of shares including restrictions on the distribution of dividends and the repayment of capital:

The Company has only one class of shares having a par values of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. Dividend distribution is for all equity shareholders who are eligible for dividend as on record date. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Shares reserved for issue under options and contracts/commitments for the sale of shares/disinvestment, including the terms and amounts : NIL (Previous Year : NIL).

For the periods of five years immediately preceding the date as at which the Balance Sheet is prepared:

a. Aggregate number and class of shares allotted as fully paid pursuant to contracts(s) without payment being received in cash : NIL (Previous year: NIL).

b. Aggregate number and class of shares allotted as fully paid -up by way of bonus shares is: The Company issued bonus shares in August, 1999 and number of equity shares issued as bonus were 2,50,00,000 and in July, 2013 and the number of equity shares issued as bonus were 4,49,92,534. Aggregate of equity shares issued as bonus shares are 6,99,92,534. During current year, equity shares issued as bonus shares NIL (previous Year: NIL).

c. Aggregate number and class of shares bought back: NIL (Previous year : Nil)

Terms of any securities convertible into equity shares issued along with the earliest date of conversion in descending order starting from farthest such date: Nil (Previous Year : Nil)

Calls unpaid (showing aggregate value of calls unpaid by directors and officers): Nil (Previous Year NIL) Forfeited Shares (amount originally paid up) : NIL (Previous Year Nil)

Detailed disclosure on capital management is given in No. 35.

- A sum of Rs. Nil (P.Y. 2021-22 Rs.3,314.23 lakhs) (20 % of Profit after tax) has been transferred to Statutory Reserve Fund as per RBI Guidelines. The same is not free for distribution of dividend.

- Market Fluctuation Reserve - For the financial year 2022-23, Board of Directors had decided not to appropriate any amount to this reserve and the balance outstanding as on 31st March, 2023 in this reserve is Rs.6,300 lakhs (P.Y. 2022 Rs.6,300 lakhs). The same is not free for distribution of dividend.

- No dividend has been recommended for the current financial year by the Board. Final dividend for FY 2021-22 of Rs 5/- per equity share of Rs. 10 each amounting to Rs.9,000.51 lakhs paid in FY 2022-23 has been accounted for in the current financial year.

- The Company has made a policy choice to recognise the effect of Taxation Laws Amendment Ordinance 2019 (''the Ordinance'') for the financial year ended 31st March, 2023. Accordingly, the effective tax rate for the FY ended 2022-23 is 25.168%.

Nature and purpose of reserves:

(a) Statutory reserve - Statutory reserve is created pursuant to section 45-IC of Reserve Bank of India Act. 1934. Company shall transfer therein a sum not less than 20% of its net profit every year as disclosed in the profit and loss account and before any dividend is declared. No appropriation of any sum from the reserve fund shall be made by the Company except for the purpose as may be specified by RBI.

(b) Securities premium - Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

(c) General reserve - General reserves are the free reserves of the Company which are kept aside out of company’s profits to meet future obligations. General reserves is a free reserve which can be utilised for any purpose after fulfilling certain conditions. No amount has been transferred to general reserve during the year ended 31st March, 2023 and 31st March, 2022.

(d) Capital reserve - Capital reserve represents the amount of net profit (after tax) through sale of securities from HTM category of investments maintained as per earlier RBI guidelines. The same will be utilized as per the regulatory guidelines and is not free for distribution of dividend.

(e) Market fluctuation reserve - The Board of Directors, in its meeting held on January 9, 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company. At the time of adoption of annual accounts each year, the Board may decide the quantum of amount to be transferred to this Reserve, if necessary. The same is not free for distribution of dividend.

(f) Retained Earnings - These represent the surplus in the statement of profit and loss and is free for distribution of dividend.

The Company has written off an amount of Rs. 5,423.14 lakhs on account of investment and Interest accrued on RHFL in the FY 2019-20. However, in the current year, the Company has received an amount of Rs. 692.64 lakhs in the bank account on account of RHFL.

#3

The Company has written off an amount of Rs. 4,971.86 lakhs on account of investment and Rs. 451.26 lakhs on account of Interest accrued on DHFL in the FY 2019-20. However, in FY 2021-22, the Company has received an amount of Rs. 1,099.78 lakhs in the bank account and Rs. 1,321.29 lakhs by way of debenture of 6.75% Piramal Capital & Housing Finance Limited on account of DHFL.

#4

An amount of Rs. 100.00 lakhs was received in FY 2022-23 (P.Y. Rs. 100.00 lakhs) from Madhavpura Mercantile Cooperative Bank Limited (MMCBL) under liquidation proceedings to whom Rs. 1,000.00 lakhs was lent in call money in the year 2001. An amount of Rs. 761.88 lakhs was to be received from MMCBL and the same was written off from the books in the year 2016. Till current FY, total amount received from MMCBL is Rs. 212.00 lakhs.

#5

Certain expenses pertaining to the previous years which could not be provided for during the last year, have been booked in the current year and shown under exceptional items. As the amount is not material, retrospective effect is not taken.

Note 31: Earnings Per Share (EPS)

Basic earnings per share is calculated by dividing the net profit for the year attributable to equity holders of Company by the weighted average number of equity shares outstanding during the year.

Diluted EPS is calculated by dividing the net profit attributable to equity holders of Company after adjusting for the effect of dilution, by the weighted average number of equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on the conversion of all the dilutive potential ordinary shares into equity shares.

1. FVTPL financial assets

Ind AS requires FVTPL investments to be measured at fair value and account for both depreciation and appreciation in fair value.

2. Derivative adjustment

Under Ind AS all the Derivatives contracts (Hedging as well as Trading purpose) are measured at Fair value and both depreciation as well as appreciation will be accounted for.

Also, Credit Value Adjustment has been recorded under Ind AS for outstanding derivative liabilites under Ind AS.

3 Fair value of Staff loans

Under Ind AS loans are fair valued and the difference between Fair value and nominal value is recognized as employee cost. This benefit is passed over the tenure of the loan & not on origination, so employee cost would be deferred over the tenure of the loan/ remaining service period whichever is shorter. Also interest income is redetermined by the market rate and the differential amount is charged under Interest income.

4. Defined benefit liabilities

Under Ind AS, remeasurements [comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets excluding amounts included in net interest on the net defined benefit liability] are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI.

5. Amortised Cost Financial Assets

Under this category, Ind AS requires it to be measured as per Effective Interest Rate Method and no mark to market needs to be done.

Above remuneration includes performance linked incentive (PLI), which is paid based on the performance of the Company and employee in the previous Financial year i.e. on deferred basis, as recommended by Nomination & Remuneration Committee and approved by the Board.

During FY 2022-23, no PLI was given. During FY 2021-22, PLI paid to Mr. Vikas Goel (Managing Director) was Rs.40 lakhs, to Mrs. Sunita Gupta (Executive Director and CFO) was Rs. 6.68 lakhs and to Mrs. Monika Kochar (Company Secretary) was Rs. 8.77 Lakhs.

Apart from above, benefit on account of leave encashment and gratuity which are provided based on actuarial valuation for the company as a whole, is also available.

1.3 Transactions with other related parties

All the transactions with related parties are at arm''s length prices except leasing of property (renting of business and residential premises of the company) etc. The required disclosure of the same is being given in form AOC-2 forming part of Board''s Report

Note 35: Capital management

For the purpose of the Company’s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company’s capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a capital adequacy ratio, which is weighted assets divided by total capital derived as per the RBI requirements. As per the RBI guidelines, Company being a Non Banking Finance Company has to maintain 15% of capital adequacy ratio.

In order to achieve this overall objective, the Company’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period.

No changes were made in the objectives, policies or processes for managing capital during the years ended 31st March, 2023 and 31st March, 2022. For the purpose of calculation of capital adequacy ratio, the Company has excluded Amortised Cost Portfolio as this portfolio is non marked to market portfolio.

Note 37: Contingent liabilities and capital commitments (to the extent not provided for)

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

The above contingent liabilities will be increased by the interest payable for delay in payment and penalties, if any. The amount is not quantified.

* Rectification affect given, however, not updated on Income Tax Department''s portal.

The Company has assessed the uncertain tax positions and concluded that there is no any such position which requires disclosure as a contingent liability.

Note 38: Segment information

The Company has been granted the License of NBFC by the Reserve Bank of India and working as a Standalone Primary Dealer.The Company''s primary activities entail supporting government borrowing program via underwriting of government securities issuances and trade in a gamut of fixed income instruments such as Government securities, Treasury Bills, State Development Loans, Corporate Bonds, Interest Rate Swaps and various money market instruments such as Certificates of Deposits, Commercial Papers etc. This is the only activity performed and is thus also the main source of risks and returns. The Company’s segments as reviewed by the Chief Operating Decision Maker (CODM) does not result into identification of different ways/ sources into which they see the performance of the Company. Accordingly, the company has a single reportable and geographical segment i.e Treasury operations and operating in India respectively. Hence, the relevant disclosures as per Ind AS 108, Operating Segments are not applicable to the Company.

Note 40: Risk Management Introduction and risk profile

The Company is primarily a dealer in debt and money market instruments. In view of the intrinsic nature of operations, the Company is exposed to a variety of risks, which can be broadly classified into credit risk, market risk and liquidity risk. It is also subject to various regulatory risks and operational risks. Well-established systems and procedures provide adequate defense against the regulatory and operational risk.

Risk management struture and policies

In terms of RBI guidelines for NBFCs, the Risk Management Committee, has been entrusted with the responsibility by the Board in laying down procedures for risk assessment and minimization. The Committee also reviews these procedures periodically to ensure that executive management is implementing and controlling the risks through means of a properly defined risk framework. Risk Management Policy is reviewed by the Risk Management Committee and on the basis of the Committee’s recommendation, the Board approves the same. PVBP (Price value of a basis point) limit on the entire marked to market portfolio stands at Rs. 550 lakhs to 0.50% of audited NOF or quarter end NOF (whichever is lower) . The one day VaR limit stands at 7.5% of audited NOF or quarter end NOF (whichever is lower) on the entire marked to market portfolio. Leverage limit stands at 20 times quarter end Board approved NOF, while Non banker borrowing limit stands at Rs. 25,000 crore.

(A) Liquidity risk

Liquidity risk is defined as the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Liquidity risk arises because of the possibility that the Company might be unable to meet its payment obligations when they fall due as a result of mismatches in the timing of the cash flows under both normal and stress circumstances.

The Company manages its liquidity requirement by analysing the maturity pattern of Company''s cash flows of financial assets and financial liabilities. The Asset Liability Management of the Company is periodically reviewed by the Board.

The Liquidity Coverage Ratio (LCR) for 2022-23 is times 96.14 (P.Y. 140.32 times). This ratio is not applicable on Primary Dealers. The LCR is calculated by dividing High-Quality Liquid assets (HQLA) by its total net cash flows over a 30 day stress period.

The table below summarises the maturity profile of the undiscounted cash flows of the Company’s financial liabilities as at 31st March, 2023:

(B) Credit Risk

Credit risk is the risk that the Company will incur a loss because its customers or counterparties fail to discharge their contractual obligations. Counterparty exposure limits and instrument-wise exposure limits are the primary tools used for managing the credit risk in the business. The Company uses the Current Exposure (CE) method for calculating credit exposure on derivative transactions as mentioned in RBI’s capital adequacy guidelines for Primary Dealer’s.

Analysis of risk concentration

In terms of paragraph 18 of the RBI notification DNBS (PD) CC No.178/03.02.001/2010-11 dated 1st July 2010, all the non-deposit taking non-banking financial companies shall adhere to the specific regulations limiting concentration in credit / investment to a single borrower or group of borrowers in a company. However, these concentration/ceilings would not be applicable where principal and interest are fully guaranteed by the Government of India. The maximum credit exposure, to any single borrower or counterparty was Rs. 30,351.00 lakhs (P.Y. 202122 Rs.19,010.00 lakhs) and to single group of borrower or counterparty was Rs. 45,351.00 lakhs (P.Y. 2021-22 Rs. 21,701.00 lakhs), before and after taking into account collateral or other credit enhancements.

(C) Market Risk

Market risk is the risk that the fair value or future cash flows of financial instruments will fluctuate due to changes in market variables such as interest rates and equity prices. Value-at-Risk (VaR), Price Value of a Basis Point (PVBP) limits, sensitivity analysis and cut-loss policies form the core of market risk management system. Impact of interest rate movements on the business and earnings profile, is mitigated by operating within a well-defined proactive stop loss limit and value-at-risk (VaR) limit. The company also conducts sensitivity analysis of its portfolio to assess impact of parallel and non-parallel shifts in the yield curve on its earnings profile. Risk concentrations are restricted with specific limits mentioned above.

Market risk - trading

Internal Value-At-Risk model (VaR model) Is performed to compute the market risk of trading portfolio. For computing market risk, the Company uses the historical simulation non-parametric approach. Under this approach, the risk measure is an estimate of the amount that could be lost on trading portfolio in a 1 day holding period due to general market movements such as Interest rate risk, Spread risk, price risk etc over 250 trading days, at 99% confidence level.

Objective

Historical Simulation is the procedure for predicting value at risk (VaR) by “simulating” or constructing the cumulative distribution function of asset returns over time. It does not require any statistical assumption beyond stationarity of the distribution of returns or, in particular, their volatility.

Limitation:

The limitation of the historical simulation lies in its I.I.D. (independent, identically distributed) assumption of returns. From empirical evidence, it is known that asset returns are clearly not independent as they exhibit certain patterns such as volatility clustering. Unfortunately historical Simulation does not take into account such patterns.

I. Random chance (a very low probability event).

II. Markets moved by more than the likely prediction of the model (i.e. volatility was significantly higher than expected).

III. Markets did not move together as expected (i.e. correlations were significantly different than what was assumed by the model).

Back testing

It is the Company’s policy to perform regular back-testing to validate the Company’s VaR calculations. When backtesting, the Company compares daily profits and losses with the estimates derived from the Company’s VaR model. The Company presents the results of back-testing to the RBI quarterly.

During 2022-23, the Company recorded two back-testing exceptions (2021-22: one exception), when hypothetical losses exceeded daily VaR limit and two back testing exceptions on comparison of actual losses with dailyVaR.

Market risk - Non trading Interest rate risk

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments. The Company have fixed rate bank deposits, non traded govt securities and borrowings and hence not exposed to interest rate risk as far as these financial instruments are concerned.

Note 41 Fair value measurement41.1 Valuation principles

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e., an exit price), regardless of whether that price is directly/ indirectly observable or estimated using a valuation technique.

In order to show how fair values have been derived, financial instruments are classified based on a hierarchy of valuation techniques.

41.2 Valuation governance

The Company''s fair value methodology and the governance over its models includes a number of controls and other procedures to ensure appropriate safeguards are in place to ensure its quality and adequacy. All new product initiatives (including their valuation methodologies) are subject to approvals by the management. The responsibility of ongoing measurement resides with the risk department.

The Risk department validates fair value estimates by:

• Benchmarking prices against observable market prices given by Financial Benchmark India Private Limited (FBIL) or other independent sources

• Re-performing model calculations

• Evaluating and validating input parameters.

41.3 Assets and liabilities by fair value hierarchy

The following table shows an analysis of financial instruments recorded at fair value by level of the fair value hierarchy:

Government Securities (Central Government Securities and State Government Securities)

Government securities are financial instruments issued by Central and State Govenments. The valuation under this category is done on the basis of prices provided by Financial Benchmarks India Private Limited (FBIL) and hence classified as level 2.

Treasury Bills (T-Bills)

Treasury Bills are short-term financial instruments issued by sovereign governments. FBIL has developed the FBIL-TBILL, a benchmark for the money market based on Treasury bills traded in the market. FBIL-TBILL is announced for fourteen tenors of 7 days, 14 days, 1 month, 2 months, 3 months, 4 month, 5 months, 6 months, 7 months, 8 months, 9 months, 10 months, 11 months and 12 months. FBIL-TBILL is calculated on the basis of secondary market trades executed. For Valuation, company use FBIL-TBILL benchmark and based on that benchmark company interpolate and calculate T-Bills prices corresponding to there residual maturities and are classified as Level 2.

Certificate of Deposits (CD)

Certificate of Deposits are short-term financial instruments issued by Banks. FBIL has developed the FBIL- CD, a new benchmark for the money market based on traded CDs reported on the FIMMDA Trade Reporting and Confirmation System (FTRAC) platform of CCIL. FBIL-CD is announced for seven tenors of 14 days, 1 month, 2 months, 3 months, 6 months, 9 months and 12 months. For Valuation, company use FBIL-CD benchmark and based on that benchmark company interpolate and calculate CD prices corresponding to there residual maturities and are classified as Level 2.

Commercial Papers (CP)

Commercial Paper is a monetary instrument issued by corporate bodies in the nature of promissory note. The issue of commercial papers is highly regulated and supervised by the Reserve Bank of India (RBI). Commercial Papers are reported on the FIMMDA Trade Reporting and Confirmation System (FTRAC) platform. As currently, CP curve is not published by FBIL/FIMMDA till then for valuation, company shall use market observable spread over T-Bill curve and based on that new benchmark (T-Bill constant Spread across the curve) company shall interpolate and calculate CP prices corresponding to the residual maturities. Investments in CPs shall be classified as Level 2.

Corporate bonds and debentures

Whilst most of these instruments are standard fixed or floating rate securities, some may have more complex coupon or embedded derivative characteristics. For valuation, Company uses last 15 days market prices when available, or other observable inputs (i.e. FIMMDA credit spread matrix and G-sec par curve) in discounted cash flow models . As corporate bonds and debenture fair valuations are based on the FIMMDA methodology, either directly (i.e. as prices)

or indirectly (i.e. derived from related curve and spread), such instruments are classified as Level 2.

Equity instruments

The equity instruments are actively traded on public stock exchanges with readily available active prices on a regular basis. Such instruments are classified as Level 1. All the company''s equity instruments are traded ones.

Mutual Funds

Units held in Liquid debt mutual funds are valued based on their AMFI published net asset value (NAV), such instruments are classified under Level 1.

Exchange traded derivative

These derivative instruments are actively traded on public stock exchanges with readily available active prices on a regular basis. Such instruments are classified as Level 1. All the company''s exchange traded derivatives are traded ones.

Interest rate derivatives

Interest rate derivatives include interest rate swaps. The most frequently applied valuation techniques include forward pricing and swap models, using present value calculations by estimating future cash flows and discounting them with the appropriate yield curves incorporating funding costs relevant for the position. These contracts are generally Level 2 unless adjustments to yield curves or credit spreads are based on significant non-observable inputs, in which case, they are Level 3. Company is having all the Level 2 interest rate derivatives.

41.5 There have been no transfers between Level 1, Level 2 and Level 3 for the year ended 31st March, 2022 and 31st March, 2023.

41.6 Valuation adjustments

Credit and Debit valuation adjustments (CVA/DVA)

The Company calculates CVA/DVA on a counterparty basis over the entire life of the exposure. CVA is calculated by multiplying the probability of default (PD), the loss given default (LGD) and the expected exposure (EE) at the time of default.

A Debit valuation adjustment (DVA) is applied to incorporate the company''s own credit risk in the fair value of derivatives (i.e., the risk that the company might default on its contractual obligations), using the same methodology as for CVA (i.e., applying the company''s PD and multiplying it with LGD and EE).

The Company applies CVA and DVA to all relevant (not fully collateralised) over-the-counter positions with the exception of positions settled through central clearing houses. During the FY 2022-23, there was no over the counter position in the derivative segment. Hence, CVA and DVA have not been calculated for this financial year.

41.8 Fair value of financial instruments not measured at fair value (At Amortised Cost)

Set out below is a comparison, by class, of the carrying amounts and fair values of the Company’s financial instruments that are not carried at fair value in the financial statements. This table does not include the fair values of non-financial assets and non-financial liabilities.

Below are the methodologies and assumptions used to determine fair values for the above financial Instruments which are not recorded and measured at fair value in the Company''s financial statements. These fair values were calculated for disclosure purposes only. The below methodologies and assumptions relate only to the instruments in the above tables

Short-term financial assets and liabilities

For financial assets and financial liabilities that have a short-term maturity (less than twelve months), the carrying amounts, which are net of impairment, are a reasonable approximation of their fair value. Such instruments include: cash and cash equivalents, balances other than cash and cash equivalents, loans, other financial assets, trade payables, Short term borrowings and other financial liabilities. Such amounts have been classified as Level 1 and 2 on the basis that no adjustments have been made to the balances in the balance sheet.

Financial asset at amortised cost

These includes staff loans . The carrying amount of such loans after applying Effective Interest Rate are a reasonable approximation of their fair value and have been classified as Level 2.

Government Securities (Central Government Securities and State Government Securities)

Government securities are financial instruments issued by Central and State Govenments. The valuation under this category is done on the basis of prices provided by Financial Benchmarks India Private Limited (FBIL) and hence classified as level 2.

Capital Adequacy Ratios as per Ind AS on June 30, 2022, September 30, 2022, December 31, 2022 and March 31,2023 were 45.09 % (P.Y. 37.14%), 21.65 % (P.Y. 34.69%), 29.95 % (P.Y. 51.18%) and 31.83% (P.Y. 66.41%) respectively as against RBI stipulation of 15 %.

Capital Adequacy Ratio as on March 31,2023 stands at 31.83% as against RBI stipulation of 15%. (The CRAR has been computed in accordance with the RBI Notification No. RBI/DNBR/2016-17/42 Master Direction DNBR. PD.004/03.10.119/2016-17 (last updated as on 14^th November 2022).

The Net Owned funds of the Company stand at Rs. 1,23,806.54 lakhs (P.Y. 1,42,563.70 lakhs) as against the minimum stipulated capital of Rs. 25,000 lakhs. Return on Average Net Owned Funds for the year 2022-23 stands at - 5.80%. (P.Y. 2021-22 -12.13 %).

Qualitative Disclosure on risk exposure in derivatives

Company has a board approved business policy which acts as an exhaustive document comprising of various regulatory and risk limits. Derivatives’ trading is guided by this document and is conducted under the ambit of the policies defined in this document.

The company follows a strict segregation of functional duties across departments. As a consequence, no single individual shall be in a position to consummate (dealing, settlement, valuation and accounting) a derivatives transaction alone by himself/herself.

The Company measures and monitors risk of its derivatives portfolio using risk metrics such as Value at Risk (VAR), PVBP and position limits. Mid-office calculates and monitors risk management parameters on daily basis and ensures compliance with the policy limits.

Over the counter (OTC) derivative transactions are covered under International Swaps and Derivatives Association (ISDA) master agreements with the respective counter parties for credit risk mitigation.

c) Shortfall at the year-end Rs. 125.15 lakhs

d) Total of Previous Year shortfall: Rs. 28.98 lakhs

e) Reason for shortfall: Pertains to ongoing projects and Rs. 125.15 lakhs has been deposited to unspent CSR account post balance sheet date. Last year, shortfall of Rs. 28.98 lakhs has been paid for the respective ongoing projects in the current financial year.

f) Nature of CSR activities: Promotion of healthcare including preventive healthcare and sanitation, environment sustainability, promoting education including special education and employment enhancing vocational skills.

g) Details of related party transactions, e.g., contribution to a trust controlled by the company in relation to CSR expenditure as per relevant Accounting Standard: Not Applicable

h) Where a provision is made with respect to a liability incurred by entering into a contractual obligation, the movements in the provision during the year should be shown separately: The Company has made provision of Rs. 125.15 lakhs for the ongoing projects.

b) During the current financial year, there was no Commercial Paper issuance. Therefore, no ratios are disclosed as compared to the last financial year.

NOTE 62: COVID-19 IMPACT

The Company neither has any adverse financial impact due to COVID-19 nor it anticipates any impact on its liquidity position or its ability to continue as a going concern.

Figures of the previous period have been regrouped, wherever considered necessary in order to make them comparable with those of the current period.

NOTE 63: SUBSEQUENT EVENTS

There is no subsequent event after the reporting date till the date of approval of the financial statements, which may impact the financial statements of the company.

---

Mar 31, 2018

NOTE : 2

NOTES TO ACCOUNTS FOR THE PERIOD ENDED 31st MARCH, 2018

	As at 31 .03.2018	(Rs in lacs) As at 31 .03.2017
NOTE 2.1
SHARE CAPITAL
Authorised
50,00,00,000 Equity Shares of Rs. 107- each 50000.00 (Previous Year 50,00,00,000 Equity Shares of Rs.10/- each)		50000.00
Issued, Subscribed and Paid Up:
18,00,10,134 Equity Shares of Rs. 107- each fully paid up (Previous Year 18,00,10,134 Equity Shares of Rs.10/- each)	18001 .01	18001.01
To know the Equity history, please see Report on Corporate Governance in previous pages.
Promoter (Holding Company)
Punjab National Bank -1 3,33,33,333 shares of Rs. 10/- each. 13333.33 (Previous Year 13,33,33,333 shares of Rs.10/-each)		13333.33
(Shareholding %)	74.07%	74.07%
Shareholding more than 5% details
Punjab National Bank -1 3,33,33,333 shares of Rs. 10/- each. 1 333.33 (Previous Year 13,33,33,333 shares of Rs.10/-each)		13333.33
(Share holding %)	74.07%	74.07%
Reconciliation of the number of Shares:	—
Opening Number of shares (Face Value Rs 10 paid up)	180010134	180010134
Add: Additions During the Year	Nil	Nil
Less: Reduction During the Year	Nil	Nil
Closing Number of shares (Face Value Rs 10 paid up)	1800101 34	180010134

• Rights, preferences and restrictions attached to each class of shares including restrictions on the distribution of dividends and the repayment of capital:

The Company has only one class of equity shares having a par value of Rs 10 per share. Each holder of equity shares is entitled to one vote per share. Dividend distribution is for all equity shareholders who are eligible for dividend as on the record date. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

• Shares reserved for issue under options and contracts/commitments for the sale of shares/ disinvestment, including the terms and amounts: Nil (Previous Year: Nil)

• For the period of five years immediately preceding the date as at which the Balance Sheet is prepared:

(a) Aggregate number and class of shares allotted as fully paid-up pursuant to contract(s) without payment being received in cash: Nil (Previous Year: Nil)

(b) Aggregate number and class of shares allotted as fully paid-up by way of bonus shares: No. of Equity Shares 44992534 Current Year Nil (Previous Year: NIL)

(c) Aggregate number and class of shares bought back : Nil (Previous Year: Nil)

• Terms of any securities convertible into equity/preference shares issued along with the earliest date of conversion in descending order starting from the farthest such date : Nil (Previous Year: Nil)

• Calls unpaid (showing aggregate value of calls unpaid by Directors and Officers): Nil (Previous Year: Nil)

• Fnrfpitpri shares- Nil fPrpx/iniis Ypar Mih

		As at 31.03.2018		(Rs in lacs) As at 31.03.2017
NOTE 2.2
RESERVES AND SURPLUS
General Reserves
Opening Balance	9776.54	9776.54	9776.54	9776.54
Statutory Reserves (Created pursuant to Section 45IC of Reserve Bank of India Act, 1934)
Opening Balance	23366.02		20022.54
Transfer from Statement of Profit and Loss	731 .52	24097.54	3343.48	23366.02
Share Premium Account
Opening Balance	2501.27	2501.27	2501.27	2501 .27
Market Fluctuation Reserve Account (Created pursuant to Board Resolution dated 9th January 2003)		6300.00	1	6300.00
Capital Reserve Account
Opening Balance	5988.96		3759.25
Transfer from Statement of Profit and Loss	331 .08	6320.04	2229.71	5988.96
Surplus
Opening Balance	23951 .20		12807.01
Add Current Year Profit	3657.58		16717.38
Amount Available for Appropriation	27608.78		29524.39
Appropriations:
-Capital Reserve	331 .08		2229.71
- Statutory Reserve Fund	731 .52		3343.48
- Dividend of FY 201 6-1 7	4500.25		-
- Dividend Distribution Tax of FY 2016-17	916.15	6479.00	-	5573.19
Balance Carried Forward to next year		21129.78		23951 .20
TOTAL		70125.17		71883.99

• A sum of Rs 731.52 lacs (P.Y. Rs 3343.48 lacs) (20 per cent of Profit After Tax) has been transferred to Statutory Reserve Fund as per RBI Guidelines.

• Net Profit (after tax) through sale of securities from HTM category amounting Rs 331.08 lacs (P.Y. Rs 2229.71 lacs) has been transferred to Capital Reserve Account as per RBI guidelines. The same will be utilized as per the regulatory guidelines.

• The Board of Directors, in its meeting held on January 9, 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company. At the time of adoption of annual accounts each year, the Board may decide the quantum of amount to be transferred to this Reserve, if necessary. For the financial year 2017-18, Board of Directors had decided not to appropriate any amount to this reserve and the balance outstanding as on March 31, 2018 in this reserve is R 6300 lacs (P.Y. Rs 6300 lacs).

• Ministry of Corporate Affairs amended the Companies (Accounting Standards) Rules, 2006 on March 30, 2016 and vide its General Circular no. 4/2016 dated 27.04.2016 has clarified that the Companies (Accounting Standards) Amended Rules, 2016 would be applicable for preparation of accounts for accounting period commencing on or after the date of notification w.e.f. Financial Year 2016-17.

According to this amendment, the Proposed Dividend is not recognizable in the accounts as liability until it is approved.

Accordingly, the Proposed Final Dividend for FY 2016-17 of Rs 2.50 per equity share of Rs 10 each amounting to Rs 4500.25 lacs and Dividend Distribution Tax (DDT) amounting to Rs 916.15 lacs has been accounted for in the current financial year. The Board of Directors have recommended a Final Dividend of Rs 1 per equity share amounting to Rs 1800.10 lacs for FY 2017-18 after the balance sheet date. The same is subject to approval by the shareholders at the ensuing Annual General Meeting of the company and therefore Proposed Final Dividend of Rs 1800.10 lacs and DDT of Rs 370.02 lacs has not been recognized as a liability as at the balance sheet date.

• Net owned Funds (after deducting Deferred Tax and Intangible Assets) of the Company stands at Rs 88066.22 lacs (P.Y. Rs 89835.70 lacs) as against the minimum stipulated capital of Rs 25000.00 lacs. Return on Average Net Worth for the year 2017-18 stands at 4.11 per cent (P.Y. 20.51 per cent).

• Capital Adequacy Ratios as on June 30, 2017, September 30, 2017, December 31, 2017 and March 31, 2018 were 30.34 per cent (P.Y. 72.02 per cent), 31.94 per cent (P.Y. 82.14 per cent), 38.86 per cent (P.Y. 74.90 per cent) and 67.09 per cent (P.Y. 54.48 per cent) respectively as against RBI stipulation of 15 per cent.

(Rs in lacs)
	As at 31.03.2018	As at 31.03.2017
NOTE 2.3
LONG TERM PROVISIONS
Provision for Employee Benefits	119.40	104.93
(Details of provision for employee benefits are given in note 2. 31)

			(Rs in lacs)
NOTE 2.4
SHORT TERM BORROWINGS
LOAN REPAYABLE ON DEMAND
• From Banks
(a) Secured Loans (Secured by way of pledge of Govt Securities)
Borrowings from RBI
- LAF Borrowing	89000.00	I	40000.00
- Term Repo Borrowing	56500.00		-
Pledge of Security Face Value- Rs 154579.40 lacs and Book Value Rs 154913.71 lacs (Previous. Year Face Value ? 40589.90 lacs and Book Value Rs 40782.00 lacs)
Refinance from RBI
Pledge of Security Face Value- Rs 35109.00 lacs and Book Value Rs 35110.15 lacs (Previous Year Face Value - NIL and Book Value -NIL)	31831.00	177331.00		40000.00
(b) Unsecured Loans
Call and Notice Money Borrowing		97800.00		90750.00

				(Rs in lacs)
		As at 31.03.2018		As at1 31.03.2017
• From Others
(a) Secured Loans (Secured by way of pledge of Govt. Securities)
CBLO Borrowings from CCIL
Pledge of Security Face Value- Rs 92070.00 lacs and Book Value Rs 89833.95 lacs (Previous Year. Face Value Rs 25470.00 lacs and Book Value Rs 24965.94 lacs)		82798.19		22634.77
Repo Borrowing
Pledge of Security Face Value- Rs 72148.00 lacs and Book Value Rs 71689.02 lacs (Previous Year. Face Value Rs 89392.00 lacs and Book Value Rs 91204.69 lacs)	71336.21	154134.40	92584.47	115219.24
(b) Unsecured Loans
Inter Corporate Borrowing		7600.00		-
LOANS AND ADVANCES FROM RELATED PARTIES
(a) Unsecured Loans (Line of Credit)
From Punjab National Bank		-		105423.71
TOTAL LOANS REPAYABLE ON DEMAND		436865.40		351392.95
TOTAL SECURED LOAN		331465.40		155219.24
TOTAL UNSECURED LOAN		105400.00		196173.71

During the year, Net Average and Peak borrowings in Call money amounted to Rs 187601.04 lacs and Rs 302025.00 lacs respectively. (Previous Year Net Average and Peak borrowings - Rs 135748.22 lacs and Rs 303050.00 lacs respectively)

For the year, average and peak leverage ratio stands at 6.15 and 8.29 times respectively (Previous Year average and peak stands at 4.47 and 7.50 times respectively)

				(Rs in lacs)
NOTE 2.5
TRADE PAYABLES
Stale Cheques	0.03		3.76
Brokerage Payable	0.69		0.51
Sundry General	4.47		4.47
Settlement Charges Payable	14.79	19.98 ''	33.54	42.28
(There are no dues outstanding to organizations covered under MSME)
TOTAL		19.98		42.28

		(Rs in lacs)
	As at 31.03.2018	As at 31.03.2017
NOTE 2.6
OTHER CURRENT LIABILITES
Unclaimed Dividend	67.89	49.08
IDS & GST Payable	56.34	12.75
Interest Accrued but not due on Short Term Borrowing	904.73	85.94
Stale Cheques	3.57	1.30
Accrual on Interest Rate Swaps	(2.66)	19.81
Unclaimed Bonus Fractional Entitlement Payable	0.32	0.32
TOTAL

			(Rs in lacs)
NOTE 2.7
SHORT TERM PROVISIONS
Provisions - For Employee Benefits	29.67		27.06
-Other Provisions for expenses	70.47		60.48
Provision for Interest Rate Swaps	39.60		-
Provisions for Income Tax	12279.71	12419.45	14868.87	14956.41
TOTAL		12419.45		14956.41
Details of provision for employee benefits (leave liability) are given in the note 2.31

(Rs in lacs)
NOTE 2.8
PROPERTY, PLANT AND EQUIPMENT AND DEPRECIATION
		Gross Block				Depreciation				Net Block
	Description	As at 01-04-17	Additions during the year	Adjustment/ Deductions during the year	As at 31-03-18	As at 01-04-17	Dep. during the year	Accumulated Dep. On deductions	As at 31-03-18	As at 31-03-18	As at 31-03-17
A	Tangible
1	Buildings	589.44	-	-	589.44	338.26	12.19	-	350.45	238.99	251.18
2	Office Equipments	51.86	4.97	2.35	54.48	43.15	9.18	2.35	49.98	4.50	8.71
3	Computers	118.40	7.73	2.09	124.04	117.77	3.90	2.09	119.58	4.46	0.63
4	Furniture & Fixtures	132.53	3.91	0.92	135.52	112.65	14.24	0.92	125.97	9.55	19.88
5	Vehicles	33.34	10.41	5.01	38.74	14.63	7.00	4.57	17.06	21.68	18.71
B	Intangible
1	Computer Software	242.39	-	15.49	226.90	240.10	1.99	15.49	226.60	0.30	2.29
	Total	1167.96	27.02	25.86	1169.12	866.56	48.50	25.42	889.64	279.48	301.40
	Previous Year	1188.12	57.18	77.34	1167.96	907.81	33.55	74.81	866.55	301.40	280.31
Useful life of Intangible Assets is taken as 6 years.

(Rs in lacs)
	As at 31.03.2018	As at 31.03.2017
NOTE 2.9
NON CURRENT INVESTMENTS (at Book Value)
Quoted Investments
Government Securities- Held To Maturity(HTM) category	83507.01	44254.41
• Market value of the above stock as on March 31 , 2018 was Rs 79644.74 lacs (Previous Year Rs For basis of valuation, refer to note 1.4. The transactions during the year are given below:		4380 1.05 Lacs).

(Rs in lacs)
		2017-18		2016-17
	Face Value	Book Value	Face Value	Book Value
Opening Stock	43377.20	44254.41	63995.80	64046.51
Add: Subscription	87873.10	87126.73	167201.10	171460.03
Transfer to HTM -
	131250.30	131381.14	231196.90	235506.54
Less: Sale and amortization	48700.00	47874.13	187819.70	191252.13
Transfer From HTM -
Closing Stock	82550.30	83507.01	43377.20	44254.41

• Securities amounting to Face Value Rs 48700.00 lacs were sold directly from the HTM category (Previous Year Rs 187819.70 lacs) and the company earned a gross profit of Rs 500.67 lacs (Previous Year Rs 3394.38 lacs). Balance profit after tax amounting to Rs 331.08 lacs has been transferred to Capital Reserve Account in accordance with RBI guidelines (Previous Year Rs 2229.71 lacs).

• Amortization on HTM category of Rs 114.34 lacs as on March 31, 2018 (Prev. Year Rs 79.33 lacs) has been separately provided (refer note no 2.23).

As at 31.03.2018		(Rs in lacs) As at 31.03.2017
Annexure to Note 2.9 -Details of Government Securities -HTM Category
SI. No. Nomenclature	(Book Value)	(Book Value)
A . State Government Securities
1 . 8.31 % UTTAR PRADESH SDL 29-07-2025	2096.43	2096.62
2. 7.97% TAMIL NADU SDL 14-10-2025	204.40	204.40
3. 7.98% KARNATAKA SDL 14-10-2025	1000.53	1000.60
4. 8.01 % PUNJAB SDL 14-10-2025	500.26	500.30
5. 8.22% KARNATAKA SDL 09-12-2025	158.00	158.00
6. 8.22% TAMIL NADU SDL 09-1 2-2025	210.10	210.10 ,

		As at 31.03.2018	(Rs in lacs) As at 31.03.2017
7.	8.22% WEST BENGAL SDL 09-12-2025	8.60	8.60
8.	8.23% UTTAR PRADESH SDL 09-12-2025	500.27	500.30
9.	7.86% WEST BENGAL SDL 13-07-2026	2001.74	2001.95
10.	7.86% UTTAR PRADESH SDL 13-07-2026	3001 .74	3001 .96
11.	6.85% RAJASTHAN SDL 30-1 1-2026	1500.91	1501.01
12.	7.31% MEGHALAYA SDL 23-08-2027	2502.30	-
13.	7.42% PUNJAB SDL 13-09-2027	2506.62	-
14.	7.44% J&K SDL 13-09-2027	2509.92
	Sub Total - (A)	18701.82	11183.84
B.	Central Government Securities
1.	6.79% GOI 15-05-2027	10653.23	-
2.	7.17% GOI 08-01 -2028	4488.90	-
3.	6.79% GOI 26-1 2-2029	7604.20	-
4.	7.61% GOI 09-05-2030	10827.21	-
5.	6.68% GOI 17-09-2031	7336.51	-
6.	7.73% GOI 19-12-2034	8144.61	-
7.	7.06% GOI 10-10-2046	965.97	-
8.	6.62% GOI 28-11-2051	898.12	-
9.	6.57% GOI 05-12-2033	9555.18	9323.53
10.	6.79% GOI 26-12-2029	-	5116.70
11.	6.84% GOI 19-12-2022	4331 .26	7734.83
12.	7.61% GOI 09-05-2030	10895.51
	Sub Total - (B)	64805.19	33070.57
	TOTAL (A B)	83507.01	44254.41

				(Rs. in lacs)
		As at 31.03.2018		As at 31.03.2017
NOTE 2.10
DEFERRED TAX ASSETS
For Provision against Leave Liability	52.09		45.68
For Provision against Fixed Assets	7.57	59.66	1.33	47.01
NET DEFERRED TAX ASSETS		59.66		47.01
Deferred Tax Adjustment		(12.65)		(2.62)

				Rs in lacs)
		As at 31.03.2018		As at 31.03.2017
NOTE 2.11
LONG TERM LOANS & ADVANCES
a) Secured and considered good
Loans to Staff
Consumer Loan to staff	0.93		3.69
Housing Loan to Staff #	126.53		7.11
# includes loan to Exec. Director & CFO - NIL (Previous Year Rs 1 .05 lacs)
Vehicle Loan to Staff	18.27	145.73	14.46	25.26
b) Unsecured and considered good
Security Deposit
Security Deposit with CCIL	1317.00		1089.00
F&O Margin Money Deposit	-		40.30
IRF Margin Money Deposit	-		347.00
Security Deposit with others	4.38	1321.38	4.84	1481.14
TOTAL		1467.11		1506.40

				(Rs in lacs)
NOTE 2.12
INVENTORIES
STOCK-IN-TRADE (Book Value)
Quoted - Non - Hedged
Treasury Bills - 91 days	10.69		65.80
Treasury Bills - 182 days	-		11370.69
Treasury Bills - 364 days	87741.01		25152.82
Government Securities	192925.03		234457.67
Certificate of Deposits and Commercial Papers	4983.48		-
Corporate Bonds & Debentures	101338.60		78117.74
Equity Shares Investment	128.83	387127.64	209.48	349374.20
Unquoted - Non - Hedged
Mutual Fund Units		-		26762.76
Quoted - Hedged
Government Securities		34954.00		7399.94

Rs in lacs)
	As at 31.03.2018	As at 31.03.2017
Corporate Bonds & Debentures	-	5001.15
	422081 .64	388538.05
Less: Provision for Diminution of Stocks	(2047.04)	(2.85)
TOTAL	420034.60	388535.20

For basis of valuation, please refer accounting policy (note 1.4). Details of securities are given in Annexure to

Note 2.12.

Stock-in-Trade includes hedged securities {Book Value - Rs 34954.00 lacs (Previous Year Rs 12401.09 lacs) and the market value of the same is Rs 35145.83 lacs (Previous Year Rs 12737.90 lacs)} and there is a net provision of - NIL (Prev Year - NIL) for diminution after adjusting the appreciation in Swaps of Rs 6.56 lacs (Previous Year Rs 143.18 lacs diminution).

The company is providing custodian services to its constituents and total holdings of 77 (P.Y. 85) constituents in Govt. Securities as at 31.03.2018 in SQL II with RBI is Rs 3955859.03 lacs (Previous Year Rs 3575148.21 lacs)

			Rs. in Lacks
		As at 31.03.2018	As at 31.03.2017
	Annexure to Note 2.12 Details of Stock-in-Trade
SI.	No. Nomenclature	(Book Value)	(Book Value)
I.	TREASURY BILLS
A.	91 Days (maturing on)
1.	1 1 -May-2017	-	30.91
2.	20-Apr-2017	-	34.89
3.	31 -May-201 8	10.69	-
	TOTAL (A)	10.69	65.80
B.	182 Days (maturing on)
1.	06-Apr-2017	-	3197.27
2.	20-Apr-2017	-	8173.42
	TOTAL (B)	-	11370.69
C.	364 Days (maturing on)
1.	04-Jan-201 8		16670.84
2.	08-Jun-2017	-	1086.76
3.	09-Nov-201 7	-	892.31
4.	12-Apr-2018	2695.26	-
5.	30-Aug-201 8	13536.44	-

(Rs in lacs)
		As at 31.03.2018	As at 31.03.2017
6.	11-Oct-2018	18703.22	-
7.	17-Oct-2018	18785.03	-
8.	13-Dec-2018	16936.58	-
9.	20-Dec-2018	93.96	-
10.	24-Jan-2019	10449.18	-
11.	21-Mar-2019	6541 .34	-
12.	15-Feb-2018	-	2670.26
13.	21-Dec-2017	-	1244.18
14.	27-Apr-2017	-	2588.47
	TOTAL (C)	87741.01	25152.82
	TOTAL (A B C)	87751.70	36589.31

II. CERTIFICATE OF DEPOSITS
1.	UJJIVAN SMALL FINANCE BANK LTD CD 10-04-2018	2495.54	-
2.	SOUTH INDIAN BANK LTD 25-04-2018	2487.94	-
	TOTAL	4983.48	-
III. GOVERNMENT DATED SECURITIES
A.	CENTRAL GOVERNMENT SECURITIES
1.	7.59% GOI 11-01-2026	-	11985.86
2.	10.03%GOI 09-08-2019	0.05	5.91
3.	8.79% GOI 08-1 1-2021	-	5.25
4.	8.35% GOI 14-05-2022	-	0.05
5.	7. 16% GOI 20-05-2023	7.21	1512.88
6.	8.40% GOI 28-07-2024	-	5381 .56
7.	7.68% GOI 15-12-2023	-	3128.73
8.	5.69% GOI 25-09-201 8	-	4962.98
9.	6.25% GOI 02-01 -201 8	-	1498.17
10.	6.62% GOI 28-1 1-2051	-	3165.62
11.	6.79% GOI 26-1 2-2029	-	15646.03
12.	6.97% GOI 06-09-2026	-	13260.33
13.	7.40% GOI 09-09-2035	-	1506.57
14.	7.50% GOI 10-08-2034		11546.88

(? in lacs)
		As at | 31.03.2018	As at 31.03.2017
15.	7.72% GOI 25-05-2025	-	14022.33
16.	7.80% GOI 11-04-2021	25.39	8.16
17.	8.28% GOI 21 -09-2027	-	4.15
18.	6.05% GOI 02-02-201 9	15919.90	-
19.	6.90% GOI 13-07-2019	12977.43	-
20.	8.35% GOI 14-05-2022	0.05	-
21.	6.30% GOI 09-04-2023	46.36	-
22.	6. 17% GOI 12-06-2023	421.69	-
23.	8.83% GOI 25-1 1-2023	2.04	-
24.	7.35% GOI 22-06-2024	4.81	-
25.	8.20% GOI 24-09-2025	1.98	-
26.	7.73% GOI 19-12-2034	149.99	-
	TOTAL (A)	29556.90	87641.46
B.	FLOATING RATE NOTES
1.	GOI FRN 07-NOV-2024	3379.93	-
	TOTAL (B)	3379.93	-
C.	STATE GOVERNMENT SECURITIES
1.	8.68% KARNATAKA 07-1 1 -201 7	-	5038.06
2.	8.50% MAHARASTRA 03-12-2017	-	2531.07
3.	8.43% GUJARAT 10-03-2018	-	1009.26
4.	8.46% MAHARASTRA 12-03-2019	1523.76	1012.30
5.	8.78% HARYANA SDL 23-07-2017	-	2532.71
6.	8.75% HIMACHAL PRADESH SDL 03-10-2017	-	5076.02
7.	8.44% PUNJAB SDL 12-11-2019	-	2500.87
8.	8.12% MAHARASHTRA SDL 13-1 1-2025	504.87	514.26
9.	6.83% PUNJAB SDL 11-11 -2020	5422.30	5422.30
10.	6.90% PUNJAB SDL 11-01-2021	6366.55	6366.55
11.	7.03% GUJARAT SDL 14-09-2018	2007.40	2007.40
12.	7.20% BIHAR SDL 25-01-2027	-	86.91
13.	7.45% GUJARAT SDL 18-02-2019	724.42	222.12
14.	7.55% WEST BENGAL SDL 17-04-2019	-	1010.11
15.	7.59% KARNATAKA SDL 29-03-2027	-	100.00
16.	7.62% ANDHRA PRADESH SDL 29-03-2027	-	2505.25
17.	7.62% TELANGANA SDL 07-03-2026 UDAY	"	5.01

			(? in lacs)
As at | 31.03.2018			As at 31.03.2017
18.	7.64% UTTAR PRADESH SDL 29-03-2027	-	57.52
19.	7.64% WEST BENGAL SDL 29-03-2027	-	2948.16
20.	7.67% TAMIL NADU SDL 22-03-2023 UDAY	-	940.00
21.	7.68% MADHYA PRADESH SDL 22-03-2023 UDAY	-	3001.51
22.	7.68% TAMIL NADU SDL 22-03-2026 UDAY	-	940.00
23.	7.69% MADHYA PRADESH SDL 22-03-2026 UDAY	-	3001.81
24.	7.70% TELANGANA SDL 22-03-2023 UDAY	-	1001.41
25.	7.71 % TELANGANA SDL 22-03-2026 UDAY	-	1001.91
26.	7.75% RAJASTHAN SDL 23-06-2018 UDAY	-	20192.31
27.	7.78% BIHAR SDL 01-03-2027	-	2013.57
28.	7.78% UTTAR PRADESH SDL 01-03-2027	-	3016.32
29.	7.85% ANDHRA PRADESH SDL 22-07-2019	-	2026.62
30.	7.86% RAJASTHAN SDL 23-06-2019 SPL	-	10190.12
31.	7.90% TAMIL NADU SDL 22-03-2027 UDAY	-	940.00
32.	7.91% MADHYA PRADESH SDL 22-03-2027 UDAY	-	3002.11
33.	7.91% TAMIL NADU SDL 22-03-2024 UDAY	-	940.00
34.	7.92% MADHYA PRADESH SDL 22-03-2024 UDAY	-	3001.51
35.	7.92% TAMIL NADU SDL 22-03-2032 UDAY	-	1738.71
36.	7.92% WEST BENGAL SDL 15-03-2017	-	507.68
37.	7.93% MADHYA PRADESH SDL 22-03-2032 UDAY	-	3002.71
38.	7.93% TELANGANA SDL 22-03-2027 UDAY	-	1002.01
39.	7.94% TELANGANA SDL 22-03-2024 UDAY	-	1001.61
40.	7.95% TELANGANA SDL 22-03-2032 UDAY	-	1002.61
41.	8.01% TAMIL NADU SDL 22-03-2030 UDAY	-	940.00
42.	8.02% MADHYA PRADESH SDL 22-03-2030 UDAY	-	3002.41
43.	8.02% TAMIL NADU SDL 22-03-2025 UDAY	-	940.00
44.	8.03% MADHYA PRADESH SDL 22-03-2025 UDAY	-	3001.81
45.	8.04% TAMIL NADU SDL 22-03-2029 UDAY	-	940.00
46.	8.04% TELANGANA SDL 07-03-2031 UDAY	-	357.97
47.	8.04% TELANGANA SDL 22-03-2030 UDAY	-	1002.41
48.	8.05% GUJARAT SDL 15-06-2026	-	3613.79
49.	8.05% GUJARAT SDL 25-02-2025	-	511.66
50.	8.05% MADHYA PRADESH SDL 22-03-2029 UDAY	-	3002.41
51.	8.05% TAMIL NADU SDL 22-03-2031 UDAY	-	1232.60

		(Rs. in lacs)
		As at 31.03.2018	As at 31.03.2017
52.	8.05% TELANGANA SDL 22-03-2025 UDAY	-	1001.71
53.	8.06% MADHYA PRADESH SDL 22-03-2031 UDAY	-	3002.41
54.	8.07% TAMIL NADU SDL 15-06-2026	-	513.51
55.	8.07% TELANGANA SDL 22-03-2029 UDAY	-	1002.31
56.	8.08% TELANGANA SDL 07-03-2029 UDAY	-	9.08
57.	8.08% TELANGANA SDL 22-03-2031 UDAY	-	1002.51
58.	8.10% WEST BENGAL SDL 25-11-2019	817.53	462.66
59.	8.17% HIMACHAL PRADESH SDL 28-02-2028 UDAY	-	37.00
60.	8.24% TAMIL NADU SDL 22-03-2028 UDAY	-	940.00
61.	8.25% MADHYA PRADESH SDL 22-03-2028 UDAY	-	3002.11
62.	8.27% TELANGANA SDL 07-03-2028 UDAY	-	14.18
63.	8.27% TELANGANA SDL 22-03-2028 UDAY	-	1002.11
64.	8.31% UTTAR PRADESH SDL 04-10-2019 SPL	519.66	519.66
65.	8.36% MAHARASHTRA SDL 27-01-2026	-	3668.04
66.	8.38% GUJARAT SDL 22-09-2020	208.60	208.60
67.	8.39% TAMIL NADU SDL 08-09-2020	-	729.83
68.	8.39% WEST BENGAL SDL 08-09-2020	-	521.31
69.	8.40% PUNJAB SDL 08-09-2020	521 .47	521 .47
70.	8.41% UTTAR PRADESH SDL 08-09-2020	-	834.62
71.	8.42% KARNATAKA SDL 10-1 1-2020	313.63	313.63
72.	8.44% PUNJAB SDL 10-1 1-2020	313.84	313.84
73.	8.47% MAHARASHTRA SDL 10-02-2026	-	525.63
74.	8.51 % GUJARAT SDL 27-1 0-2020	52.43	52.43
75.	8.59% UTTAR PRADESH SDL 18-03-2019	517.31	517.31
76.	8.63% UTTAR PRADESH SDL 10-03-2029 UDAY	-	2122.07
77.	8.91% WEST BENGAL SDL 18-07-2022	-	105.40
78.	8.92% TAMIL NADU SDL 08-08-2022	-	211.00
79.	9.02% UTTARAKHAND SDL 21-03-2022	-	105.60
80.	9.25% UTTAR PRADESH SDL 09-11-2021	-	535.97
81.	9.39% KARNATAKA SDL 04-12-2023	-	64.74
82.	7.75% RAJASTHAN SDL 23-06-2018 UDAY	12214.67	-
83.	6.65% TAMIL NADU SDL 14-01-2019	3489.34	-
84.	7.13% ANDHRA PRADESH SDL 23-01-2019	11017.36	-
85.	7.45% ANDHRA PRADESH SDL 18-02-2019	502.16	-

			Rs. in lacs
		As at | 31.03.2018	As at 31.03.2017
86.	7.45% TAMIL NADU SDL 18-02-2019	501.76	-
87.	7.68% PUNJAB SDL 02-03-2019	5032.49	-
88.	7.83% MAHARASHTRA SDL 02-03-2019	504.81	-
89.	8.40% GUJARAT SDL 18-03-2019	508.21	-
90.	8.46% RAJASTHAN SDL 18-03-2019	511.56	-
91.	7.10% WEST BENGAL SDL 05-05-2019	7494.13	-
92.	7.83% ANDHRA PRADESH SDL 24-06-2019	148.99	-
93.	8.14% MAHARASHTRA SDL 23-09-2019	255.08	-
94.	8.27% MAHARASHTRA SDL 07-10-2019	512.51	-
95.	8.03% PUNJAB SDL 25-1 1 -201 9	152.81	-
96.	8.05% KARNATAKA SDL 25-1 1 -201 9	101.92	-
97.	8.27% GUJARAT SDL 09-12-2019	102.96	-
98.	8.37% PUNJAB SDL 23-12-2019	504.23	-
99.	8.51 % GOA SDL 1 0-03-2020	103.69	-
100.	8.53% MAHARASHTRA SDL 1 0-03-2020	513.21	-
101.	8.39% ANDHRA PRADESH SDL 25-03-2020	51.24	-
102.	8.57% ANDHRA PRADESH SDL 13-04-2020	152.40	-
103.	8.09% TAMIL NADU SDL 09-06-2020	201.50	-
104.	8.15% GUJARAT SDL 07-07-2020	144.36	-
105.	8.39% MAHARASHTRA SDL 08-09-2020	101.00	-
106.	8.35% GUJARAT SDL 06-10-2020	357.85	-
107.	6.81% MAHARASHTRA SDL 25-10-2020	8571.50	-
108.	6.81 % MAHARASHTRA SDL 08-1 1 -2020	21701.14	-
109.	8.40% GUJARAT SDL 24-11 -2020	104.21	-
110.	7.07% PUNJAB SDL 28-12-2020	12016.90	-
111.	8.39% TAMIL NADU SDL 05-01-2021	101.00	-
112.	7.78% HIMACHAL PRADESH SDL 07-03-2021	100.62	-
113.	8.39% RAJASTHAN SDL 15-03-2021 UDAY	5221.81	-
114.	8.36% GUJARAT SDL 16-03-2021	104.14	-
115.	7.55% MAHARASHTRA SDL 21-03-2021	1547.70	-
116.	7.75% PUNJAB SDL 13-07-2021	499.91	-
117.	6.94% ODISHA SDL 26-07-2021	12320.10	-
118.	8.69% KERALA SDL 08-02-2022	76.69	-
119.	6.93% MAHARASHTRA SDL 09-08-2022	16423.80	-

		As at 31.03.2018	As at 31.03.2017
120.	9.29% PUNJAB SDL 09-10-2023	230.73	-
121.	9.33% UTTAR PRADESH SDL 09-10-2023	1099.66	-
122.	7.70% TAMIL NADU SDL 22-02-2024 UDAY	497.54	-
123.	9.84% ANDHRA PRADESH SDL 26-02-2024	5.37	-
124.	8.19% UTTARAKHAND SDL 09-12-2025	1774.67	-
125.	7.15% MAHARASHTRA SDL 13-10-2026	46.87	-
126.	7.23% TAMIL NADU SDL 14-06-2027	479.61	-
127.	7.18% TAMIL NADU SDL 26-07-2027	478.15	-
128.	8.07% RAJASTHAN SDL 31-01-2028	1009.63	-
129.	8.13% RAJASTHAN SDL 27-03-2028	1502.68	-
130.	8.14% H ARYAN A SDL 27-03-2028	2373.96	-
131.	7.18% MAHARASHTRA SDL 28-06-2029	6705.81	-
	TOTAL (C)	159988.20	146816.21
	TOTAL (A B C)	192925.03	234457.67
IV.	CORPORATE BONDS & DEBENTURES
A.	PSU - TAXABLE BONDS
1.	9.81 %PFC 07-1 0-201 8	1033.00	-
2.	7.11%NHAI 05-11-2022	2500.00	-
3.	7.47% PFC 16-09-2021	2561.81	2561.81
4.	7.63% PFC 14-08-2026	-	2484.59
5.	8.39% PFC 19-04-2025	-	332.91
6.	9.30% PFC 26-08-201 7	-	2555.08
7.	9.81% PFC 07-1 0-201 8	-	1038.94
	TOTAL (A)	6094.81	8973.33
B.	PSU -TAX FREE
1.	6.32% IRFC 20-12-2017 Tax Free	-	1000.00
2.	6.72% IRFC 20-12-2020 Tax Free	1500.00	1500.00
	TOTAL (B)	1500.00	2500.00
C.	DEBENTURES & OTHERS
1.	9.75% MAHESH HYDRA POWER CORPN 2022	181.82	227.27
2.	7.35% LIC HSG FIN LTD 16-02-2018	-	5003.16
3.	7.50% HDFC LTD 12-10-2018	-	7500.16
4.	7.51% LIC HSG. FIN LTD 14-08-2018		2504.99

NOTE 2.24 - SEGMENT INFORMATION

Reportable Segments in respect of business operations of the company have been identified on the basis of varied risk and return profile attached to each business segment which is the primary reporting format, and which are in terms of Accounting Standard - 17 on Segment Reporting. The company does not have any geographical segments, as such there is no secondary reporting format.

FY 201 7-1 8									(Rs in lacs)
	T-Bills/ CP/CD	Corp. Bonds & Debentures	Govt. Securities	Derivatives	Fixed Deposits	Mutual F Mar 31, 2017 NOTE - 1- ISSUER COMPOSITIONS OF INVESTMENTS IN NON-GOVERNMENT SECURITIES As on March 31, 2017, the total stock of Rs, 388535.20 lacs (Prev. Year : Rs, 496058.15 lacs) (Book Value) comprises of - Govt. Securities (including T. Bills) - Rs, 278446.92 lacs (Prev. Year : Rs, 325384.63 lacs ), - Equity Instruments - Rs, 206.63 lacs (Prev. Year : Rs, NIL lacs), - Money Market instruments - Rs, NIL lacs (Prev. Year : Rs, 130630.12 lacs), - Corporate Bonds and Debentures - Rs, 83118.89 lacs (Prev. Year : Rs, 40043.40 lacs) and - Mutual Fund Units - Rs, 26762.76 lacs (Prev. Year : Rs, NIL lacs). NOTE - 2. - OTHERS a. Tax deducted at source on the interest, miscellaneous income and commission and fees during the financial year 2016-17, amounted to Rs, 8.60 lacs (Prev. Year Rs, 302.21 lacs). b. The Company does not have any foreign currency transactions whether by way of imports, exports or any expenditure. Therefore, no expenditure has been incurred in foreign currency in the current year as well as in the previous year. c. Being a Level-1 enterprise, all the accounting standards are applicable to the company. However on the basis of operations carried out by the Company, AS-2, AS-7, AS-11, AS-12, AS-14, aS-19, AS-21, AS-23, AS-24, AS-25 and AS-27 are not applicable. d. In the opinion of the management there are no impairment losses (P.Y. NIL). Therefore, impairment losses have not been provided in the current financial statements. e. No expenditure on research and development has been incurred by the company (P.Y NIL). f. Provisions to the extent known and reasonable have been provided in the books of accounts. g. There are no trade receivables as on March 31, 2017 and also as on March 31, 2016. h. Figures for the previous year have been regrouped and rearranged wherever considered necessary, in order to make them comparable with those of the current period. *No cash in hand account is maintained in the books of accounts of the company on a regular manner. All cash payments/receipts are routed through an imprest maintained with an officer of the company which is paid/settled through cheque. The above mentioned deposit of SBN represent the balance of imprest in cash by the officer concerned in SBN. Mar 31, 2016 - Rights, preferences and restrictions attached to each class of shares including restrictions on the distribution of dividends and the repayment of capital: The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. Dividend distribution is for all equity shareholders who are eligible for dividend as on record date. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. - Shares reserved for issue under options and contracts/commitments for the sale of shares/disinvestment, including the terms and amounts: Nil (Prev. Year: Nil) - For the period of five years immediately preceding the date as at which the Balance Sheet is prepared: (a) Aggregate number and class of shares allotted as fully paid-up pursuant to contract(s) without payment being received in cash: Nil (Prev. Year: Nil) (b) Aggregate number and class of shares allotted as fully paid-up by way of bonus shares: Nil (Prev. Year: NIL) (c) Aggregate number and class of shares bought back : Nil (Prev. Year: Nil) - Terms of any securities convertible into equity/preference shares issued along with the earliest date of conversion in descending order starting from the farthest such date : Nil (Prev. Year: Nil) - Calls unpaid (showing aggregate value of calls unpaid by Directors and Officers): Nil (Prev. Year: Nil) - Forfeited Shares: Nil (Prev. Year: Nil) - A sum of Rs. 689.93 lacs (Prev. Year Rs. 1792.28 lacs) (20 per cent of Profit After Tax) has been transferred to Statutory Reserve Fund as per RBI Guidelines. - Net Profit (after tax) through sale of securities from HTM category amounting to Rs. 356.56 lacs (Prev. Year Rs. 1072.52 lacs) has been transferred to Capital Reserve Account as per RBI guidelines. The same will be utilized as per the provisions of the Companies Act, 2013 (refer Note 2.9 for details). - The Board of Directors, in its meeting held on January 9, 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company. At the time of adoption of annual accounts each year, the Board may decide the quantum of amount to be transferred to this Reserve, if necessary. For the financial year 2015-16, Board of Directors had decided not to appropriate any amount to this reserve and the balance outstanding as on March 31, 2016 in this reserve is Rs. 6300 lacs (Prev. Year Rs. 6300 lacs) - The Company has proposed a final dividend of Rs. 1.10 per share for FY 2015-16 (Prev. Year Rs. 1.50 per share), subject to the approval of shareholders in Annual General Meeting, amounting to Rs. 1980.11 lacs (Prev. Year Rs. 2700.15 lacs). Accordingly, a provision of Dividend Distribution Tax of Rs. 403.10 lacs (Prev. Year Rs. 552.85 lacs) has been made. - Net owned Funds (after deducting Deferred Tax and Intangible Assets) of the Company stands at Rs. 73122.23 lacs (Prev. Year Rs. 71805.84 lacs) as against the minimum stipulated capital of Rs. 25000.00 lacs. Return on Net Worth for the year 2015-16 stands at 5.10 per cent (Prev. Year 12.98 per cent). - Capital Adequacy Ratios as on June 30, 2015, September 30, 2015, December 31, 2015 and March 31, 2016 were 66.41 per cent (Prev. Year 36.21 per cent), 69.50 per cent (Prev. Year 39.36 per cent), 71.39 per cent (Prev. Year 54.72 per cent) and 68.07 per cent (Prev. Year 65.07 per cent) respectively as against RBI stipulation of 15 per cent. - Securities amounting to Face Value Rs. 111781.50 lacs were sold directly from the HTM category (Prev. Year Rs. 278379.00 lacs) and the company earned a gross profit of Rs. 545.26 lacs (Prev. Year Rs. 1624.78 lacs). Balance profit after tax amounting to Rs. 356.56 lacs has been transferred to Capital Reserve Account in accordance with RBI guidelines (Prev. Year Rs. 1072.52 lacs). - Amortization of Rs. 42.47 lacs on the HTM category as on March 31, 2016 has been separately provided in note no 2.23 relating to other expenses (Prev. Year figures of amortization in HTM category as on March 31, 2015 is Rs. 99.48 lacs) An amount of Rs. 1000 lacs was lent in Call Money to Madhavpura Mercantile Co-operative Bank Ltd. (MMCBL) in March 2001, which became overdue as on March 31, 2001. The Company was informed by MMCBL that the Government of India (Ministry of Agriculture, Department of Agriculture and Co-operation, New Delhi), in consultation with RBI, has formed Reconstruction Scheme and the amount would be paid accordingly. However, the repayment was not done by them as per the scheme and vide Government’s notifications instructed that all payments by bank including installment of repayment due in August 2007, August 2008 and August 2009 (totaling to Rs. 761.88 lacs against which Rs. 761.88 lacs provision was outstanding) and payments of interest and the deposit amount were deferred till August 2011. RBI cancelled the license of MMCBL to carry on banking business in India and Liquidator was appointed. The Company has already lodged the claim with the Liquidator as per the format advertised by them in the news papers, and awaiting response from them. The provision for diminution in investment has been written off in the current financial year. Reportable Segments in respect of business operations of the company have been identified on the basis of varied risk and return profile attached to each business segment which is the primary reporting format, and which are in terms of Accounting Standard - 17 on Segment Reporting. The company does not have any geographical segments, as such there is no secondary reporting format. - Provision for Diminution of Rs. 107.83 lacs on Government Securities(including hedged securities), Rs. 54.59 lacs on Treasury Bills, Rs. NIL lacs on Equity Investments and Rs. NIL lacs on Corporate Bonds as on March 31, 2016 has been provided for and included in segment liabilities (Prev. Year Rs. 74.63 lacs on Government Securities, Rs. NIL lacs on Treasury Bills, Rs. NIL lacs on Equity Investments and Rs. NIL lacs on Corporate Bonds and Debentures) - Fixed Deposits placed by the company are funded out of the Net Owned Funds and thus have not been apportioned any costs. Consequently, the total allocable expenses have been allocated to all other segments. Figures of the previous year have been regrouped and rearranged accordingly. NOTE - 2.25 - RELATED PARTY INFORMATION As per Para 9 of the Accounting Standard 18 on Related Party Disclosures, the Company, being a state controlled enterprise, is not required to make disclosures of related party relationships with other state controlled enterprises and transactions with such enterprises. Other information as per the Standard is as under: - The overall supervision and control of the company vests with the Board of Directors. The Managing Director and Executive Director and CFO of the company, appointed by the Board of Directors, are working full time with the Company. - Out of the total Eight Directors on the Board of the company as at March 31, 2016, four are Independent Directors. Only the Non-Executive Directors are being paid sitting fees for the Board / Committee Meetings. W.e.f March 22, 2016 sitting fee paid to non-executive Directors was increased from Rs. 10000/- to Rs. 25000/- for attending each meeting of the Board and from Rs. 5000/- to Rs. 10000/- for attending each meeting of Audit Committee/CSR Committee/ Nomination and Remuneration Committee/Only Independent Directors’ Meeting. Sitting fee for attending each meeting of (a) Share Transfer and Issue of Duplicate Shares Committee; and (b) Stakeholders’ Relationship Committee is same at Rs. 5000/-. During the year, the Company has paid a sum of Rs. 12.21 lacs towards sitting fee, including service tax (Prev. Year Rs. 11.52 lacs). - Other information in this regard is available in Corporate Governance Report and Board’s report. a. Tax deducted at source on the interest, miscellaneous income and commission and fees during the financial year 2015-16, amounted to Rs. 302.21 lacs (Prev. Year Rs. 322.42 lacs). b. The Company does not have any foreign currency transactions whether by way of imports, exports or any expenditure. Therefore, no expenditure has been incurred in foreign currency in the current year as well as in the previous year. c. Being a Level-1 enterprise, all the accounting standards are applicable to the Company. However, on the basis of operations carried out by the Company, AS-7, AS-11, AS-12, AS-14, AS-16, AS-19, AS-23, AS-24, AS-25 and AS-27 are not applicable. d. In the opinion of the management there are no impairment losses (Prev.Year NIL). Therefore, impairment losses have not been provided in the current financial statements. e. No expenditure on research and development has been incurred by the company (Prev.Year NIL). f. Provisions to the extent known and reasonable have been provided in the books of accounts. g. There are no trade receivables as on March 31, 2016 and also as on March 31, 2015. h. Figures for the previous year have been regrouped and rearranged wherever considered necessary, in order to make them comparable with those of the current period. Mar 31, 2015 1. SHARE CAPITAL * Rights, preferences and restrictions attaching to each class of shares including restrictions on the distribution of dividends and the repayment of capital: The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. Dividend distribution is for all equity shareholders who are eligible for dividend as on record date. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. * Shares reserved for issue under options and contracts/commitments for the sale of shares/disinvestment, including the terms and amounts: Nil (Prev. Year: Nil) * For the period of five years immediately preceding the date as at which the Balance Sheet is prepared: (a) Aggregate number and class of shares allotted as fully paid-up pursuant to contract(s) without payment being received in cash: Nil (Prev. Year: Nil) (b) Aggregate number and class of shares allotted as fully paid-up by way of bonus shares: Nil (Prev. Year: 45002534 equity shares of Rs. 10 each) (c) Aggregate number and class of shares bought back : Nil (Prev. Year: Nil) * Terms of any securities convertible into equity/preference shares issued along with the earliest date of conversion in descending order starting from the farthest such date : Nil (Prev. Year: Nil) * Calls unpaid (showing aggregate value of calls unpaid by Directors and Officers): Nil (Prev. Year: Nil) * Forfeited shares: Nil (Prev. Year: Nil) Reportable Segments in respect of business operations of the company have been identified on the basis of varied risk and return profile attached to each business segment which is the primary reporting format, and which are in terms of Accounting Standard - 17 on Segment Reporting. The company does not have any geographical segments, as such there is no secondary reporting format. 2. RELATED PARTY INFORMATION As per Para 9 of the Accounting Standard 18 on Related Party Disclosures, the Company, being a state controlled enterprise, is not required to make disclosures of related party relationships with other state controlled enterprises and transactions with such enterprises. Other information as per the Standard is as under: * The overall supervision and control of the company vests with the Board of Directors.The Managing Director and Executive Director and CFO of the company, appointed by the Board of Directors, are working full time with the company. * Out of the total Eight Directors on the Board of the company as at March 31, 2015, four are independent Directors. Only the Non-Executive Directors are being paid sitting fees for the Board / Committee Meetings. The sitting fees for attending the Board Meeting is Rs. 10000/- per meeting and for Committee Meeting sitting fee payable is Rs. 5000/- per meeting. During the year the Company has paid a sum of Rs. 11.52 lacs towards sitting fee, including service tax (Prev. Year Rs. 8.96 lacs). * Other information in this regard is available in Corporate Governance Report and Board's report. 3. REAL ESTATE EXPOSURES Exposure to Real Estate Sector (direct and indirect) is NIL both in current and Prev. Year (as it is not applicable to the company) 4. OTHERS * Tax deducted at source on the interest, miscellaneous income and commission and fees during the financial year 2014-15, amounted to Rs. 322.42 lacs (Prev. Year Rs. 287.23 lacs). * The Company does not have any foreign currency transactions whether by way of imports, exports or any expenditure. Therefore, no expenditure has been incurred in foreign currency in the current year as well as in the Prev. Year. * Being a Level-1 enterprise, all the accounting standards are applicable to the company. However on the basis of operations carried out by the Company, AS-7, AS-11, AS-12, AS-14, AS-16, AS-19, AS-23, AS-24, AS-25 and AS-27 do not apply. * There are no impairment losses. Therefore, the company has not accounted for any impairment losses. * No expenditure on research and development has been incurred by the company. * Provisions to the extent known and reasonable have been provided in the books of accounts. * There are no contingent liabilities. * There are no trade receivables as on March 31, 2015and also as on March 31,2014. * Figures for the Prev. Year have been regrouped and rearranged wherever considered necessary, in order to make them comparable with those of the current period. Mar 31, 2014 1. A sum of Rs. 1227.64 lacs (20% of Profit After Tax) has been transferred to Statutory Reserve Fund as per RBI Guidelines. 2. Net Profit (after tax) through sale of securities from HTM category amounting Rs. 1183.62 lacs has been transferred to Capital Reserve Account as per RBI guidelines. The same will be utilized as per the provisions of the Companies Act, 1956 3. The Board of Directors, in its meeting held on January 9, 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company. At the time of approval of annual accounts each year, the Board may decide the quantum of amount to be transferred to this Reserve, if necessary. For the financial year 2013-14, Board of Directors had decided not to appropriate any amount to this reserve and the balance outstanding as on March 31, 2014 in this reserve is Rs. 6300 lacs 4. The Company has proposed a final dividend of Rs. 0.90 per share, subject to approval of shareholders in Annual General Meeting amounting to Rs. 1620.09 lacs. Accordingly, a provision of Dividend Distribution Tax of Rs. 275.33 lacs has been made @ 15 per cent plus surcharge @ 10 per cent plus Education Cess @ 2 per cent and Secondary and Higher Education Cess @ 1 per cent. 5. Net Owned Funds (after deducting Deferred Tax and Intangible Assets) of the company stands at Rs. 66253.18 lacs as against the minimum stipulated capital of Rs. 25000.00 lacs. Return on Net Worth for the year 2013-14 stands at 9.57 per cent. 6. Capital Adequacy Ratios as on June 30, 2013, September 30, 2013, December 31, 2013 and March 31, 2014 were 46.47 per cent, 53.84 per cent, 39.89 per cent and 49.14 per cent respectively as against RBI stipulation of 15 percent. 7. During the year, Net Average and Peak borrowings in Call Money amounted to Rs. 84573.97 lacs and Rs. 179914.00 lacs respectively. (Prev. Year Net Average and Peak borrowings – Rs. 72192.00 lacs and Rs.161505.00 lacs respectively) 8. For the year, average and peak leverage ratio stands at 2.60 and 6.54 times respectively (Prev. Year average and peak stands at 3.87 and 5.56 times respectively) 9. Govt. Securities pledged for availing LAF/Term Repo : Face Value Rs. 90480.00 lacs, Book Value Rs. 89661.82 lacs (Prev. Year : Face Value Rs. 68300.00 and Book value Rs. 67051.51 lacs). 10. Govt. Securities pledged for availing CBLO borrowing : Face Value Rs. 54900.00 lacs, Book Value Rs. 54369.66 lacs (Prev. Year : Face Value Rs. 43200.00 lacs and Book Value Rs. 42204.39 lacs). 11. Govt. Securities pledged for availing RBI Refinance : Face Value Rs. 33007.00 lacs, Book Value Rs. 32604.43 lacs (Prev. Year : Face Value Rs. 35440.00 and Book Value Rs. 34394.06 lacs). The securities mentioned in (i) ,(ii) and (iii) above were not available for trading as on March 31, 2014. 12 - RELATED PARTY INFORMATION As per Para 9 of the accounting Standard 18 on Related Party Disclosures, the company, being a state controlled enterprise, is not required to make disclosures of related party relationships with other state controlled enterprises and transactions with such enterprises. Other information as per the Standard is as under: The overall supervision and control of the company vests with the Board of Directors. The Managing Director of the company, appointed by the Board of Directors, is working full time with the company. Out of the total Seven Directors on the Board of the company as at March 31, 2014, four are independent Directors. Only the Non-Executive Directors are being paid sitting fees for the Board / Committee Meetings. The sitting fees for attending the Board Meeting is Rs. 10000/- per meeting and for Committee Meeting sitting fee payable is Rs. 5000/- per meeting. During the year the company has paid a sum of Rs. 8.96 lacs towards sitting fee, including service tax (Prev. Year Rs. 9.93 lacs) Mar 31, 2013 - A sum of Rs. 1224.92 lacs (20% of Profit After Tax) has been transferred to Statutory Reserve Fund as per RBI Guidelines. - Net Profit (after tax) through sale of securities from HTM category amounting Rs. 1106.09 lacs has been transferred to Capital Reserve Account as per RBI guidelines. The same will be utilized as per the provisions of the Companies Act, 1956. - The Board of Directors, in its meeting held on January 9, 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the Company. At the time of adoption of annual accounts each year, the Board may decide the quantum of amount to be transferred to this Reserve, if necessary. For the FY 2012-13, Board of Directors had decided not to appropriate any amount to this reserve and the balance outstanding as on March 31, 2013 in this reserve is Rs. 6300 lacs. - The Company has proposed a final dividend of Re 1.00 per share, subject to approval of shareholders in Annual General Meeting amounting to Rs. 1350.08 lacs. Accordingly, a provision of Dividend Distribution Tax of Rs. 229.44 lacs has been made @ 15 per cent plus surcharge @ 10 per cent plus Education Cess @ 2 per cent and Secondary and Higher Education Cess @ 1 per cent. - Net Owned Funds (after deducting Deferred Tax and Intangible Assets) of the Company stands at Rs. 62008.28 lacs as against the minimum stipulated capital of Rs. 25000.00 lacs. Return on networth for the year 2012-13 stands at 10.25 per cent. - Capital Adequacy Ratios as on June 30, 2012, September 30, 2012, December 31, 2012 and March 31, 2013 were 52.32 per cent, 41.61 per cent, 35.88 per cent and 42.34 per cent respectively as against RBI stipulation of 15 percent. - Market Value of the above stock as on March 31, 2013 was Rs.18259.36 lacs (Prev. Year: Rs. 16769.22 Lacs). For basis of valuation, refer to note 1.5b. - As per the RBI Circular, the Company had Govt. securities of Rs. 17367.10 lacs Face Value (Book Value - Rs. 17453.68 lacs) in Held to Maturity (HTM) category as on March 31, 2012. During the current year, amount of Rs.121755.62 (Face Value) was classified to HTM category, by subscribing from the primary market (Prev. Year: Rs. 12119.10 lacs) and an amount of Rs. 10452.90 lacs (Face Value) has been transferred to HTM category (Prev. Year: Rs. 8905.30 lacs). Securities amounting to Rs. 118977.80 lacs (Face Value) were sold directly from the HTM category (Prev. Year: Rs. 16486.60 lacs) and the Company earned a gross profit of Rs. 1637.33 lacs (Prev. Year: Rs. 59.89 lacs). Balance after tax amounting to Rs. 1106.09 lacs has been transferred to Capital Reserve Account in accordance with RBI guidelines (Prev. Year: Rs. 40.46 lacs). An amount of Rs. 12842.20 lacs (Face Value) has been transferred from HTM category to trading category (Prev. Year: Rs. NIL). Further, an amount of Rs. 41.85 lacs is amortised by Straight line basis on the securities (Prev. Year: Rs. 12.20 lacs). The outstanding under HTM category as on March 31, 2013 is Rs. 17755.62 lacs Face Value (Book Value Rs. 18229.58 lacs). - An amount of Rs. 1000 lacs was lent in Call Money to Mahavpura Mercantile Co-operative Bank Ltd. (MMCBL) in March 2001, which became over due as on March 31, 2001. We have been informed by MMCBL that the Government of India (Ministry of Agriculture, Department of Agriculture and Co-operation, New Delhi), in consultation with RBI, has formed Reconstruction Scheme and the amount would be paid accordingly. However, the repayment was not done by them as per the scheme and vide Government''s notifications instructed that all payments by bank including installment of repayment due in August 2007, August 2008 and August 2009 (totaling to Rs. 761.88 lacs against which Rs. 761.88 lacs provision was outstanding) and payments of interest and the deposit amount are deferred till August 2011. Now, RBI has cancelled the license of MMCBL to carry on banking business in India and Liquidator has been appointed. We have lodged the Claim with the Liquidator as per the format advertised by them in the news papers, and awaiting response from them. * The aggregate carrying value and market value as at March 31, 2013 is Rs. 325175.92 lacs and Rs. 325175.92 lacs (Prev. Year: Rs. 248694.67 lacs and Rs. 248694.67 lacs) respectively. (i) Govt. Securities pledged for availing LAF : Face Value - Rs. 68300.00 lacs, Book Value - Rs.67051.51 lacs (Prev. Year: Face Value - Rs. 45852.90 and Book Value - Rs. 46024.21 lacs). (ii) Govt. Securities pledged for availing CBLO borrowing : Face Value - Rs. 43200.00 lacs, Book Value - Rs. 42204.39 lacs (Prev. Year: Face Value - Rs. 29600.00 lacs and Book value - Rs. 28644.04 lacs) . (iii) Govt. Securities pledged for availing RBI Refinance : Face Value Rs - 35440.00 lacs, Book Value - Rs.34394.06 lacs (Prev. Year: Face Value - Rs. 36269.60 and Book Value - Rs. 36567.19 lacs). The securities mentioned in (i) ,(ii) and (iii) above were not available for trading as on March 31, 2013. NOTE - 1.1 - SEGMENT INFORMATION Reportable Segments in respect of business operations of the Company have been identified on the basis of varied risk and return profile attached to each business segment which is the primary reporting format, and which are in terms of Accounting Standard - 17 on Segment Reporting. The Company does not have any geographical segments, as such there is no secondary reporting format. NOTE - 1.2 RELATED PARTY INFORMATION As per Para 9 of the accounting Standard 18 on Related Party Disclosures, the Company, being a state controlled enterprise, is not required to make disclosures of related party relationships with other state controlled enterprises and transactions with such enterprises. Other information as per the Standard is as under: - The overall supervision and control of the Company vests with the Board of Directors. The Managing Director of the Company, appointed by the Board of Directors, is working full time with the Company. - Out of the total Seven Directors on the Board of the Company as at March 31, 2013, four are independent Directors. Only the Non-Executive Directors are being paid sitting fees for the Board / Committee Meetings. The sitting fees for attending the Board Meeting is Rs. 10000/- per meeting and for Committee Meeting sitting fee payable is Rs. 5000/- per meeting. During the year, the Company has paid a sum of Rs. 9.93 lacs towards sitting fee, including applicable service tax (Prev. Year : Rs. 8.35 lacs) NOTE - 1.3 ISSUER COMPOSITION OF INVESTEMENTS IN NON-GOVERNMENT SECURITIES As on March 31, 2013, the total stock of Rs. 325175.92 lacs comprises of Government Securities (including Treasury Bills) of Rs. 239819.40 lacs (Prev. Year : Rs. 248694.67 lacs ), Equity Instruments Rs. 19.97 lacs (Prev. Year : Rs. 623.98 lacs), Money Market instruments Rs. 59055.97 lacs (Prev. Year : Rs. 4547.23 lacs) and Corporate Bonds and Debentures Rs. 26280.58 lacs (Prev. Year : Rs. 15249.72 lacs). The portfolio of Non-Government Securities comprises of Rs. 25901.38 lacs (Book value) of AAA rated), Rs. 379.20 lacs (Book Value) of AA rated bonds and Rs. 59055.97 lacs (Book Value) of A1 rated Bank CDs. (Prev. Year : Rs. 14466.90 lacs of AAA rated, Rs. 829.20 lacs of AA rated and Rs. 4547.23 lacs of A1 rated Bank CDs). NOTE - 1.4 REAL ESTATE EXPOSURES Exposure to Real Estate Sector (direct and indirect) is NIL both in current and previous year (as it is not applicable to the Company). NOTE - 1.5 CESS PROVISION In the absence of any government notification, the Company has not provided for cess envisaged in terms with the Section 441A (1) of the Companies Act 1956. NOTE - 1.6 OTHERS Tax deducted at source on the interest, miscellaneous income and commission and fees during the financial year 2012-13, amounted to Rs. 142.23 lacs (Prev. Year : Rs. 88.36 lacs). Figures for the previous year have been regrouped and rearranged wherever considered necessary, in order to make them comparable with those of the current period. Mar 31, 2012 - A sum of Rs. 421.05 lacs (20% of Profit After Tax) has been transferred to Statutory Reserve Fund as per RBI Guidelines. - Net Profit (after tax) through sale of securities from HTM amounting to Rs. 40.46 lacs has been transferred to Capital Reserve Account as per RBI guidelines. The same will be utilised as per the provisions of the Companies Act, 1956. - The Board of Directors, in its meeting held on January 9, 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company. At the time of adoption of annual accounts each year, the Board may decide the quantum of amount to be transferred to this Reserve, if necessary. For the FY 2011-12, Board of Directors had decided not to appropriate any amount to this reserve and the balance outstanding as on March 31, 2012 in this reserve is Rs. 6300 lacs. - The company has proposed a final dividend of Re. 1.00 per share, subject to approval of shareholders in Annual General Meeting, amounting to Rs. 1350.08 lacs. Accordingly, a provision of Dividend Distribution Tax of Rs. 219.01 lacs has been made @ 15 per cent plus surcharge @ 5.00 per cent plus Education Cess @ 2 per cent and Secondary Higher Education Cess @ 1 per cent. - Net Owned Funds (after deducting Deferred Tax Assets and Intangible Assets) of the company stands at Rs. 57469.10 lacs as against the minimum stipulated capital of Rs. 25000.00 lacs. Return on net worth for the year 2011-12 stands at 3.68 per cent. - Capital Adequacy Ratios as on June 30, 2011, September 30, 2011, December 31, 2011 and March 31, 2012 were 95.84 per cent, 79.76 per cent, 73.96 per cent and 74.72 per cent respectively as against RBI stipulation of 15 per cent. - Market Value of the above stock as on March 31, 2012 is Rs.16769.22 lacs. As such, the above asset is overstated by Rs. 684.46 lacs. For basis of valuation, refer note 1.5 b. - The company had categorized an amount of Rs. 12829.30 lacs (Book Value - Rs. 12898.88 lacs) of Government Securities in Held To Maturity (HTM) category as on March 31, 2011. During the current year, an amount of Rs. 21024.40 lacs (Book value - Rs. 20369.69 lacs) was transferred to HTM category, by subscribing from the primary market. Securities amounting to Rs. 16486.60 lacs (Book Value - Rs. 15802.69 lacs) were sold directly from the HTM category and the company earned a gross profit of Rs. 59.89 lacs. Balance after tax amounting to Rs. 40.46 lacs was transferred to Capital Reserve Account in accordance with the RBI guidelines. Further, an amount of Rs.12.20 lacs was amortized by Straight- line basis on the securities. The outstanding under HTM category as on March 31, 2012 is Rs. 17453.68 lacs (Face value - Rs. 17367.10 lacs). - An amount of Rs. 1000 lacs was lent in Call Money to Madhavpura Mercantile Co-operative Bank Ltd. (MMCBL) in March 2001, which became overdue as on March 31, 2001. We have been informed by MMCBL that the Govt. of India (Ministry of Agriculture, Department of Agriculture & Co-operation, New Delhi) in consultation with RBI, has formed Reconstruction Scheme and the amount would be repaid accordingly. However, the repayment was not made by them as per the scheme and vide Government's notifications instructed that all payments by bank including installment of repayment due in August 2007, August 2008, and August 2009 (totalling to Rs. 761.88 lacs against which Rs. 761.88 lacs provision was outstanding) and payments of interest to banks on their deposits are deferred till August 2011. The Govt. of India made a reference to RBI for extending the validity of the Reconstruction Scheme. RBI has not extended - For basis of valuation, please refer accounting policy (note 1.5.a). Details of securities are given in Annexure 2. - Stock in trade include hedged securities (Book Value - Rs. 33640.80 lacs and the market value of the same is Rs. 33556.20 lacs). - Provision for Diminution of securities includes Rs. 84.60 lacs for Hedged stock securities and Rs. 50.30 lacs MTM gain on the designated Swap contracts. - The aggregate carrying value and market value as at March 31, 2012 is Rs. 248694.67 lacs and Rs. 248694.67 lacs respectively (Prev Year- Rs. 118131.15 lacs and Rs.118131.15 lacs). *(i) Govt. Securities pledged for availing LAF - Face Value Rs. 45852.90 lacs - Book Value Rs.46024.21 lacs. (ii) Govt. Securities pledged for availing CBLO borrowing - Face Value Rs. 29600 lacs - Book Value Rs. 28644.04 lacs. (iii) Govt. Securities pledged for availing RBI Refinance - Face Value Rs. 36269.60 lacs - Book Value Rs. 36567.19 lacs. The securities mentioned in (i), (ii) and (iii) above were not available for trading as on March 31, 2012. - Provision for Diminution of Rs 1584.35 lacs on Government Securities (including the hedging securities), Rs.52.28 lacs on Treasury Bills, Rs.14.81 lacs on Equity investments and Rs. 46.37 lacs on Corporate Bonds as on 31.03.2012 has been provided for and shown in segment liabilities (Prev Year Rs. 1014.02 lacs on Government Securities, Rs. 9.42 lacs on Treasury Bills, Rs. 7.19 lacs on Equity Investments and Rs. NIL on Corporate Bonds and Debentures). - Fixed deposits placed by the company are funded out of the net owned funds and thus have not been apportioned any costs. Consequently, the total allocable expenses have been allocated to all other segments. Figures for the previous year have been regrouped and rearranged accordingly. NOTE -1 RELATED PARTY INFORMATION As per Para 9 of the Accounting Standard 18 on Related Party Disclosures, the company, being a state controlled enterprise, is not required to make disclosures of related party relationships with other state controlled enterprises and transactions with such enterprises. Other information as per the Standard is as under: - The overall supervision and control of the company vests with the Board of Directors. The Managing Director of the company, appointed by the Board of Directors, is working full time with the company. - Out of a total of eight Directors on the Board of the company as at March 31, 2012, four are Independent Directors. Only the Non-Executive Directors are being paid sitting fees for the Board / Committee Meetings. The Sitting fees for attending the Board Meeting was raised from Rs. 5000/- to Rs. 10000/- per meeting w.e.f. June 25, 2011 and for Committee Meeting sitting fee payable is Rs. 5000/- per meeting. During the year the company has paid a sum of Rs. 8.35 lacs towards sitting fee. NOTE - 2.ISSUER COMPOSITION OF INVESTMENTS IN NON-GOVERNMENT SECURITIES As on March 31, 2012, the total stock of Rs. 248694.67 lacs comprise of Government securities (including Treasury Bills) of Rs. 228273.74 lacs, Rs. 623.98 lacs of Equity instruments, Rs. 4547.23 lacs of money market instruments and Rs. 15249.72 lacs of Corporate Bonds & Debentures. The portfolio of Corporate Bonds & Debentures comprises Rs.14466.90 lacs (Book value) of AAA rated, Rs. 829.20 lacs (Book value) of AA rated bonds and Rs. 4547.23 lacs (Book value) of A1 rated Bank CDs. NOTE - 3. OTHERS Tax deducted at source on interest, miscellaneous income and commission and fees during the FY 2011-12 amounted to Rs. 88.36 lacs (Prev. Year : Rs 98.07 lacs) Figures for the previous year have been regrouped and rearranged wherever considered necessary, in order to make them comparable with those of the current period. Mar 31, 2011 1. The company has adopted the rates provided by FIMMDA for determining market value of securities in terms of Accounting Policy no. 5(ii) and net diminution in the value of securities as on March 31, 2011 amounting to Rs. 1030.63 lacs has been provided for in the valuation of closing stock. 2. Securities against Repo transactions outstanding are as under: The above book value of securities under REPO is included under stock in trade in accordance with new REPO guidelines as mentioned in Accounting Policy no. 6. Due to change in Accounting Policy, the profit was over stated by Rs. 1.08 lacs. 3. Managerial Remuneration paid to the Managing Director during the year 2010-11: (Mr. S. Ranganathan was Managing Director till April 3, 2010 and thereafter, Mr. D.V.S.S.V. Prasad joined the organization with immediate effect and later on appointed by the Board as Managing Director w.e.f. May 3, 2010) Includes salary arrears of Rs.4.02 lacs paid by parent bank - Punjab National Bank) Computation of Net Profits under Section 349 of the Companies Act, 1956 has not been made, as commission by way of percentage of profits is not payable to the Managing Director. 4. An amount of Rs.1000 lacs was lent in Call money to Madhavpura Mercantile Cooperative Bank Limited (MMCBL) in March 2001, which became overdue as on March 31, 2001. We have been informed by MMCBL that the Government of India (Ministry of Agriculture, Department of Agriculture & Cooperation, New Delhi) has formed a reconstruction scheme and the amount would be repaid accordingly. However, the repayment was not made by them as per the scheme and vide Government’s notifications instructed that all payments by the bank including installment of repayment due in August 2007, August 2008 and August 2009 (totalling to Rs. 761.88 lacs against which Rs. 380 lacs provision was outstanding) and payments of interest to banks on their deposits are deferred till August, 2010. However, during September, 2010, as per RBI’s prudential norms on “Income Recognition and Asset Classification and Provisioning” the Board of Directors decided to make 100% provision for the concerned asset, by making additional provision of Rs. 381.88 lacs. As on March 31, 2011, the total principal outstanding was Rs. 761.88 lacs (previous year Rs.761.88 lacs) against which provision of Rs.761.88 lacs is outstanding. In view of the modification in the Reconstruction Scheme, and notification by the government, no further amount was due, till August 2011. 5. Appropriation of the Profits: . The Company has proposed a final dividend Rs. 1.20 per share, subject to approval of shareholders in Annual General Meeting amounting to Rs. 1620.09 lacs. Accordingly, a provision of Dividend Distribution Tax of Rs. 269.08 lacs has been made @ 15 per cent plus surcharge @ 7.50 per cent plus Education Cess @ 2 per cent and Secondary Higher Education Cess @ 1 per cent. . A sum of Rs. 77 lacs has been transferred to General Reserve. Further, a sum of Rs. 612 lacs has been transferred to Statutory Reserve Fund. . The Board of Directors, in its meeting held on 09th January 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company. At the time of adoption of annual accounts each year, Board may decide the quantum of amount to be transferred to this Reserve, if necessary. For the FY 2010- 11, Board of Directors had decided not to appropriate any amount to this reserve and the balance outstanding in this reserve is Rs. 6300 lacs. 6. Reportable segments in respect of business operations of the company have been identified on the basis of varied risk and return profile attached to each business segment which is the primary reporting format, and which are in terms of Accounting Standard - 17 on Segment Reporting. The company does not have any geographical segments, as such there is no secondary reporting format. The Segment information is as under: Note: Diminution of Rs. 1014.02 lacs on Government Securities, Rs.9.42 lacs on Treasury Bills, Rs.7.19 lacs on Equity investments and Rs. NIL on Corporate Bonds (as there is net appreciation) as on March 31, 2011 has been provided for (Prev. Year Rs.958.45 lacs on Government Securities, Rs. 11.05 lacs on Treasury Bills and Rs. NIL on Corporate Bonds and Debentures). Fixed deposits placed by the company are funded out of the net owned funds and thus have not been apportioned any costs. Consequently, the total allocable expenses have been allocated to all other segments. Figures for the previous year have been regrouped and rearranged accordingly. 7. Related Party Transactions As per Para 9 of the Accounting Standard 18 on Related Party Disclosures, the company being a state controlled enterprise is not required to make disclosures of related party relationships with other state controlled enterprises and transactions with such enterprises. Other information as per the Standard is as under: a. The overall supervision and control of company vests with Board of Directors. The Managing Director of the company is on deputation from Punjab National Bank and is working full time with the company. Details of managerial remuneration are disclosed vide Note No. 3 above in the Notes to Accounts. b. Out of a total of nine Directors on the Board of the company as at March 31, 2011, six are Independent directors. Only the Non-Executive Directors are being paid sitting fees for the Board / Committee meetings at the rate of Rs. 5000/- per meeting. During the year the company has paid a sum of Rs. 8.05 lacs (Prev. Year Rs.5.50 lacs) towards sitting fee. 8. Earnings per share (EPS)/Diluted Earnings per share (DEPS) There has been no change in the share capital during the year. There are no potential equity shares outstanding. Hence there is no dilution of the Basic EPS. 9. Deferred Tax An adjustment for the current year amounting to Rs 20.20 lacs {Prev. Year Rs. (126.16) lacs} has been made out of the profits for the current year. 10. Disclosure on Interest Rate Swaps Market risk : In the event of 100 basis points adverse movement in interest rates there will be a negative impact of Rs. 0.06246 lacs (Prev. Year Rs 38.04 lacs) on Trading Swaps in the swap book. The losses, which would be incurred if, counter parties failed to fulfill their obligations works out to Rs.10.72 lacs (Prev. Year Rs. 789.97 lacs) Company’s exposure with regard to outstanding swap transactions is limited to Banks and Primary Dealers. Collateral : No Collateral is insisted upon from counterparty Credit Risk Concentr ation : State Bank of India. - Rs.5.36 lacs. (Previous year Rs. 251.62 lacs) 11. As on March 31, 2011, Secured loans (including market repo) of Rs. 64354.97 lacs comprise of Rs. 24500.00 lacs under RBI’s refinance facility, Rs. 16500.00 lacs under RBIs LAF repo facility, Rs. 1733.10 lacs under CBLO and Rs. 21621.87 lacs under REPO facility. Unsecured loans of Rs. 21110.00 lacs comprise of Call Money Borrowings of Rs. 21110.00 lacs. During the year 2010-11, average and peak net borrowings in Call Money amounted to Rs. 41262.83 lacs and Rs.103590.00 lacs respectively. For the year, the average and peak leverage ratio stands at 1.59 and 3.06 times respectively. 12. (a) As on March 31, 2011, the total stock of Rs. 118131.15 lacs comprise of Government securities (including Treasury Bills) of Rs. 100194.19 lacs, Rs.55.57 lacs of Equity instruments, Rs.3403.12 lacs of Money Market Instruments and Rs. 14478.27 lacs of Corporate Bonds & Debentures. The portfolio of Corporate Bonds & Debentures comprises Rs.13649.07 lacs of AAA rated and Rs.829.20lacs of AA+ rated bonds. (b) As per the RBI circular dated 31st August 2009, the company had categorized an amount of Rs. 13269.55 lacs of Government Securities in Held To Maturity (HTM) category. During the current year, an amount of Rs. 358.52 lacs was transferred from HTM to trading category by booking depreciation of Rs.0.64 lacs. Further, an amount of Rs. 12.15 lacs was amortized by Straight-line basis on the securities. The outstanding under HTM category as on March 31, 2011 stood at Rs. 12898.88 lacs, the details of which is given in the Annexure to Schedule 8 (b.1). 13. Capital Adequacy Ratios as on June 30, 2010, September 30, 2010, December 31, 2010 and March 31, 2011 were 57.60 per cent, 70.67 per cent, 56.18 per cent and 94.42 per cent respectively as against RBI stipulation of 15 per cent. Net Owned Funds of the company stands at Rs. 56891.59 lacs as against the minimum stipulated capital of Rs. 25000.00 lacs. Return on net worth for the year 2010-11 stands at 5.43 per cent. 14. Tax deducted at source on interest, miscellaneous income and commission and fees during the FY 2010-11 amounted to Rs 98.07 lacs (Prev. Year : Rs 312.18 lacs). 15. Provision for leave encashment has been done in accordance with the requirement of AS - 15 (revised) as per actuarial valuation for the year 2010-11 on April 1, 2011 and as per Projected Unit Credit Method, details for which are given hereunder: 16. During the year 2010-11, the carrying amount of assets were reviewed and none of the assets of the company were found to be impaired, for which the procedure prescribed as per Accounting Standard 28 needs to be applied. 17. The Mutual Fund Commission accrued (Rs. 82.04 lacs) as on March 31, 2011, has been taken to income on an estimated basis and to the extent that the commission on reinvestment of dividend, in case of reinvestment plan, cannot be calculated accurately. 18. During the year, refund from the Income Tax Department, related to eight years from FY 2001-02 to 2008-09, amounting to Rs.1818.16 lacs have been received. Interest to the tune of Rs. 183.88 lacs received on the refund is included in the miscellaneous income. 19. During the year, an amount of Rs.1.13 lacs on account of non- receipt of TDS certificate and Rs. 0.04 lacs on account of excess accrual in Mutual Fund income receivable have been written off. 20. Figures for the previous year have been regrouped and rearranged wherever considered necessary, in order to make them comparable with those of the current period. Mar 31, 2010 1. The company has adopted the rates provided by FIMMDA for determining market value of securities in terms of Accounting Policy no. 5(ii) and net diminution in the value of securities as on March 31, 2010 amounting to Rs. 969.50 lacs has been provided for in the valuation of closing stock. 2. An amount of Rs.1000 lacs was lent in Call Money to Madhavpura Mercantile Cooperative Bank Limited (MMCBL) in March, 2001 which became overdue as on March 31, 2001. Therefore a provision of Rs. 500 lacs was made against the same. Thereafter, during the year 2001-02, a reconstruction scheme was formulated under the aegis of Government of India and the lending inclusive of interest upto the date of implementation was converted into term deposit of Rs.1036.58 lacs carrying interest @ 7.50 per cent p.a (payable semi-annually) and the principal repayable in five equal instalments starting from 5th year. Further in the year 2004-05, the rate of interest was revised to 3 per cent p.a. w.e.f. August 24, 2004 in terms of the notification issued by the Central Registrar of Cooperative Societies. The interest and principal on the term deposit with Madhavpura Mercantile Cooperative Bank Limited was serviced regularly after its last restructuring in August, 2004 upto March 31, 2007. In view of the regular servicing of the principal and the interest amount, as a conservative approach the management decided to reverse the provision in proportion to the original provision made vis a vis the original principal amount and recovery of the principal amount till March 31, 2007. Accordingly an amount of Rs.120 lacs was reversed during the year 2006-07 from the original provision of Rs. 500 lacs made in the year 2000-01. The provision thus stood at Rs. 380 lacs as on March 31, 2007. During the year 2007-08, an amount of Rs. 25.91 lacs only was received from MMCBL on May 3, 2007. Government of India (Ministry of Agriculture, Department of Agriculture & Cooperation, New Delhi) vide its notifications instructed that all payments by the bank including next installment of repayment due in August, 2007, August, 2008 and August, 2009 (totalling to Rs. 554.57 lacs) and payments of interest to banks on their deposits are deferred till August, 2010. In view of the modification in the Reconstruction Scheme, no further amount was due, till August, 2010. However, as per RBIs prudential norms on "Income Recognition and Asset classification and Provisioning" the Board of Directors has decided to make 100% provision for the concerned investment. Therefore, an additional provision of Rs. 381.88 lacs was made during the year 2009-10. As on March 31, 2010, the total principal outstanding was Rs. 761.88 lacs (previous year Rs.761.88 lacs) against which provision of Rs. 761.88 lacs (previous year Rs. 380 lacs) is outstanding. 3. Appropriation of Profits • The Company has proposed a final dividend of Re. 1 per share subject to approval of shareholders in Annual General Meeting amounting to Rs. 1350.08 lacs. Accordingly, a provision of Dividend Distribution Tax of Rs. 229.44 lacs has been made @ 15 per cent plus surcharge @ 10 per cent plus Education Cess @ 2 per cent and Secondary Higher Education Cess @ 1 per cent. • A sum of Rs. 735 lacs has been transferred to Statutory Reserve Fund. • Board of Directors, in its meeting held on January 9, 2003, had decided to build up Market Fluctuation Reserve over a period of time with the cap equal to paid up capital of the company, with the condition that at time of approval of annual accounts each year, Board may decide the quantum of amount to be transferred to this Reserve, if necessary. At the time of approval of accounts relating to FY 2002-03 - a sum of Rs. 2700 lacs and FY 2003-04 - a sum of Rs. 3600 lacs respectively, had been transferred to this Reserve. For FY 2009-10, the Board of Directors had decided not to appropriate any amount to this reserve. 4. Reportable segments in respect of business operations of the company have been identified on the basis of varied risk and return profile attached to each business segment which is the primary reporting format and which are in terms of Accounting Standard - 17 on Segment Reporting. The company does not have any geographical segments, as such there is no secondary reporting format. 5. Related Party Transactions As per Para 9 of the Accounting Standard 18 on Related Party Disclosures, the company being a state controlled enterprise is not required to make disclosures of related party relationships with other state controlled enterprises and transactions with such enterprises. Other information as per the Standard is as under: a. The overall supervision and control of company vests with Board of Directors. The Managing Director of the company is on deputation from Punjab National Bank and is working full time with the company. Details of managerial remuneration are disclosed vide Note No. 3 above in the Notes to Accounts. b. Out of a total of ten Directors on the Board of the company as at March 31, 2010, six are Independent Directors. Only the Independent Directors are paid sitting fees for the Board / Committee meetings at the rate of Rs. 5,000/- per meeting. During the year the company has paid a sum of Rs. 5.50 lacs (Prev. Year Rs. 3.65 lacs) towards sitting fee. 6. As on March 31, 2010, Secured loans (excluding market repo) of Rs. 28194.02 lacs comprise of Rs. 19000 lacs under RBIs LAF repo facility and Rs. 9194.02 lacs under CBLO. Unsecured loans of Rs. 46500.00 lacs comprise of Call Money Borrowings of Rs. 21500 lacs & Inter Corporate Borrowings of Rs. 25000 lacs. During the year 2009-10, average and peak net borrowings in call money amounted to Rs. 66538.01 lacs and Rs. 118200.00 lacs respectively. For the year, the average and peak leverage ratio stands at 1.99 and 2.99 times respectively. 7. As on March 31, 2010, the total stock of Rs. 93535.39 lacs comprise of Government Securities (including Treasury Bills) of Rs. 86505.96 lacs and Rs. 7029.43 lacs of Corporate Bonds & Debentures. The portfolio of Corporate Bonds & Debentures comprises Rs. 6200.23 lacs of AAA rated and Rs. 829.20 lacs of AA+ rated bonds. As per the RBI circular dated August 31, 2009, the company has categorized a portion of Government Securities portfolio in the Held To Maturity (HTM) category (an amount of Rs. 13269.55 lacs). The details of securities so transferred to this category have been given in the Annexure to Schedule 8 (b.1). As per the said circular, such transfers should be done with the approval of the Board, at the acquisition cost/ book value/ market value on the date of transfer, whichever is the least, and the diminution, if any, on such transfer shall be fully provided for. Accordingly, diminution has been charged to trading income in the Profit & Loss Account to the extent of Rs. 64.51 lacs on the date of transfer. Securities (HTM) have not been marked to market and diminution not provided as on March 31, 2010. Initially this categorization was available up to March 31, 2010, but RBI vide circular IDMD.PDRD No. 3483/03.64.00/2009-10 dated March 9, 2010 extended the same until further advice. Due to change in the policy (as permitted by RBI) these securities were not marked to market as on March 31, 2010 and further diminution in market values of these securities of Rs. 213.04 lacs not provided in the books. As a consequence, the profit as per Profit & Loss Account has increased by Rs. 213.04 lacs and stock in trade increased by Rs. 213.04 lacs, on account of change in accounting policy (permitted by RBI). These securities have been shown under Current Assets, as these securities have been permitted to be considered for retransfer to trading category once in every quarter, if necessary. 8. In the absence of any government notification the company has not provided for cess envisaged in terms with the Section 441A (1) of the Companies Act, 1956. 9. As per Schedule VI of the Companies Act, 1956, total outstanding dues of Small and Micro Enterprises (SME) should be disclosed separately. The total sundry creditors are of Rs. 84.61 lacs, which include Rs. 13.72 lacs kept in sundry operations. The actual recipients of this amount are not known, as claims are not received by the Company. Therefore, it is not possible to give information of outstanding dues of SME. 10. Tax deducted at source on interest, miscellaneous income and commission & fees during the FY 2009-10 amounted to Rs. 312.18 lacs. (Prev. Year : Rs. 505.67 lacs). 11. During the year 2009-10, the carrying amount of assets were reviewed and none of the assets of the company are found to be impaired for which the procedure prescribed as per Accounting Standard 28 needs to be applied. 12. The company has discontinued its Merchant Banking activities w.e.f. March 15, 2010. The company has also closed its Kolkatta & Bangalore branches w.e.f. March 30, 2010 and the public / clients of these regions will be served from HO at Delhi. 13. The Mutual Fund Commission accrued (Rs. 67.29 lacs) as on March 31, 2010, has been taken to income on an estimated basis to the extent that the commission on reinvestment of dividend (in case of reinvestment plan) cannot be calculated accurately. 14. Amount of Rs. 2.16 lacs receivable as Income from Project Appraisal pertaining to previous years could not be received, in spite of tremendous follow up, due to the reasons that the parties were not available at their registered address. It was decided to write off this amount of Rs. 2.16 lacs as bad debts written off. 15. Figures for the previous year have been regrouped and rearranged wherever considered necessary, in order to make them comparable with those of the current period Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article IFSC Code Currency Select Bank Select State Select City Select Branch From INR - Indian Rupee USD - United States Dollar EUR - Euro GBP - British Pound Sterling AED - United Arab Emirates Dirham SAR - Saudi Riyal AUD - Australian Dollar OMR - Omani Rial MYR - Malaysian Ringgit CAD - Canadian Dollar CHF - Swiss Franc ZAR - South African Rand SGD - Singapore Dollar JPY - Japanese Yen BHD - Bahraini Dinar KWD - Kuwaiti Dinar QAR - Qatari Riyal BMD - Bermudian Dollar ARS - Argentine Peso AWG - Aruban Florin BAM - Bosnia and Herzegovina convertible mark BBD - Barbadian Dollar BDT - Bangladeshi Taka BGN - Bulgarian Lev BOB - Bolivian Boliviano BRL - Brazilian Real BSD - Bahamian Dollar BWP - Botswana Pula CLP - Chilean Peso CNY - Chinese Yuan COP - Colombian Peso CZK - Czech Koruna DKK - Danish Krone DOP - Dominican Peso EGP - Egyptian Pound FJD - Fijian Dollar GHS - Ghana Cedi GMD - Gambian Dalasi GTQ - Guatemalan Quetzal HKD - Hong Kong Dollar HRK - Croatian Kuna HUF - Hungarian Forint IDR - Indonesian Rupiah ILS - Israeli Sheqel IRR - Iranian Rial ISK - Icelandic Krona JMD - Jamaican Dollar JOD - Jordanian Dinar KES - Kenyan Shilling KHR - Cambodian Riel KRW - South Korean Won LAK - Lao Kip LBP - Lebanese Pound LKR - Sri Lankan Rupee MAD - Moroccan Dirham MDL - Moldovan Leu MGA - Malagasy Ariary MKD - Macedonian Denar MUR - Mauritian Rupee MVR - Maldivian Rufiyaa MXN - Mexican Peso NAD - Namibian Dollar NGN - Nigerian Naira NOK - Norwegian Krone NPR - Nepalese Rupee NZD - New Zealand Dollar PAB - Panamanian Balboa PEN - Peruvian Sol PHP - Philippine Peso PKR - Pakistani Rupee PLN - Polish Zloty PYG - Paraguayan Guaraní RON - Romanian Leu RSD - Serbian Dinar RUB - Russian Rouble SCR - Seychellois Rupee SEK - Swedish Krona SYP - Syrian Pound THB - Thai Baht TND - Tunisian Dinar TRY - Turkish Lira TTD - Trinidad and Tobago Dollar TWD - Taiwanese Dollar UAH - Ukraine Hryvnia UGX - Ugandan Shilling UYU - Uruguayan Peso VES - Venezuelan Bolívar VND - Vietnamese Dong XAF - Central African Franc XCD - East Caribbean Dollar XOF - West African Franc XPF - CFP Franc To INR - Indian Rupee USD - United States Dollar EUR - Euro GBP - British Pound Sterling AED - United Arab Emirates Dirham SAR - Saudi Riyal AUD - Australian Dollar OMR - Omani Rial MYR - Malaysian Ringgit CAD - Canadian Dollar CHF - Swiss Franc ZAR - South African Rand SGD - Singapore Dollar JPY - Japanese Yen BHD - Bahraini Dinar KWD - Kuwaiti Dinar QAR - Qatari Riyal BMD - Bermudian Dollar ARS - Argentine Peso AWG - Aruban Florin BAM - Bosnia and Herzegovina convertible mark BBD - Barbadian Dollar BDT - Bangladeshi Taka BGN - Bulgarian Lev BOB - Bolivian Boliviano BRL - Brazilian Real BSD - Bahamian Dollar BWP - Botswana Pula CLP - Chilean Peso CNY - Chinese Yuan COP - Colombian Peso CZK - Czech Koruna DKK - Danish Krone DOP - Dominican Peso EGP - Egyptian Pound FJD - Fijian Dollar GHS - Ghana Cedi GMD - Gambian Dalasi GTQ - Guatemalan Quetzal HKD - Hong Kong Dollar HRK - Croatian Kuna HUF - Hungarian Forint IDR - Indonesian Rupiah ILS - Israeli Sheqel IRR - Iranian Rial ISK - Icelandic Krona JMD - Jamaican Dollar JOD - Jordanian Dinar KES - Kenyan Shilling KHR - Cambodian Riel KRW - South Korean Won LAK - Lao Kip LBP - Lebanese Pound LKR - Sri Lankan Rupee MAD - Moroccan Dirham MDL - Moldovan Leu MGA - Malagasy Ariary MKD - Macedonian Denar MUR - Mauritian Rupee MVR - Maldivian Rufiyaa MXN - Mexican Peso NAD - Namibian Dollar NGN - Nigerian Naira NOK - Norwegian Krone NPR - Nepalese Rupee NZD - New Zealand Dollar PAB - Panamanian Balboa PEN - Peruvian Sol PHP - Philippine Peso PKR - Pakistani Rupee PLN - Polish Zloty PYG - Paraguayan Guaraní RON - Romanian Leu RSD - Serbian Dinar RUB - Russian Rouble SCR - Seychellois Rupee SEK - Swedish Krona SYP - Syrian Pound THB - Thai Baht TND - Tunisian Dinar TRY - Turkish Lira TTD - Trinidad and Tobago Dollar TWD - Taiwanese Dollar UAH - Ukraine Hryvnia UGX - Ugandan Shilling UYU - Uruguayan Peso VES - Venezuelan Bolívar VND - Vietnamese Dong XAF - Central African Franc XCD - East Caribbean Dollar XOF - West African Franc XPF - CFP Franc 1 USD = 89.577 (USD to INR) 1 EUR = 104.886 (EUR to INR) 1 GBP = 119.845 (GBP to INR) More Period 7-14 Days 15-30 Days 31-45 Days 46-90 Days 4-6 Months 7-12 Months 1-2 Years 2-5 Years 5-10 Years >10 Years More Information on PNB Gilts Ltd. PNB Gilts Ltd. Tools Bulk Deals PNB Gilts Ltd. Company Details Company Profile Company History Management Team Capital Structure Product Mix Banker/Auditor/Registrar Company History Bonus BSE Price History NSE Price History PNB Gilts Ltd. Key Financial Ratios Ratios PNB Gilts Ltd. Results Quarterly Results Half Yearly Results Nine Months Results Annual Results PNB Gilts Ltd. Financial Data Audited Results Cash Flow Balance Sheet PNB Gilts Ltd. Reports Accounting Policies Auditors Report Directors Report Notes To Account PNB Gilts Ltd. 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Sensex Slumps 678 Pts; Nifty Cracks 25,800; Why Stock Market Is Falling Today? Stocks To Buy Today, Dec 9: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Tuesday Stocks To Buy Today, Dec 8: Top 4 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Monday Stock Market Alert! Major Pre-Open Session Change From Dec 8: Full Timings, Rules & All You Need To Know Bank Nifty Surges: RBI’s 25 bps Rate Cut Triggers Strong Upside in Major Banking Stocks Closing Bell: Sensex Ends 158 pts Higher, Nifty Climbs Above 26,000; Hero MotoCorp, HAL Up 2% Each Stocks To Buy Today, Dec 4: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Thursday About GoodReturns GoodReturns is your trusted source for the latest financial news, investment insights, and expert guidance. Stay updated and make informed decisions with our comprehensive updates. 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