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Investor attention Stock Brokers can accept securities as margin from clients only by way of pledge in the depository system w.e.f. September 01, 2020. | Initiate Margin Pledge Online. Click here|

IDFC Ltd.

Dec 05 BSE 85.30 (+ 1.45 1.73%)
Volume799567
Prev. Close 83.85
Open Price 83.50
Today's Low / High
83.50 86.40
B. Price (Qty.)0.00 (0)
O. Price (Qty.) 0.00 (0)
52 Wk Low / High 42.25
86.40
Dec 05 NSE 85.15(+ 1.35 1.61%)
Volume9488092
Prev. Close 83.80
Open Price 83.80
Today's Low / High
83.70 86.30
B. Price (Qty.)0.00 (0)
O. Price (Qty.) 0.00 (0)
52 Wk Low / High
42.20 86.30

You can view full text of the latest Director's Report for the company.

ISIN No INE043D01016 Market Cap. ( in Cr. ) 13617.36 P/BV 1.53 Book Value ( ) 55.84
BSE Code 532659 52 Week High/Low ( ) 86/42 FV/ML 10/1 P/E(X) 212.88
NSE Code IDFCEQ Book Closure 20/04/2022 EPS ( ) 0.40 Div Yield (%) 0.00
Year End :2022-03 

Your Directors have pleasure in presenting the Twenty-Fifth Annual Report on the business and operations of the Company together with the audited financial statements, prepared under Ind-AS, for the financial year ended March 31, 2022.

OPERATIONS REVIEW

Effective October 1, 2015 post demerger of Financing Undertaking into IDFC FIRST Bank Limited (earlier known as IDFC Bank), IDFC Limited (“IDFC” or “the Company”) is operating as an NBFC - Investment Company mainly holding investment in IDFC Financial Holding Company Limited (“IDFC FHCL”) which is a non-operative financial holding company. IDFC FHCL in turn holds investments in IDFC FIRST Bank Limited (“IDFC FIRST Bank”) and IDFC Asset Management Company Limited (“IDFC AMC”). IDFC has negligible business operations and is main focus is to simplify corporate structure and unlock value for shareholders. During the year, Balance Sheet size increased from Rs. 9,303.78 crore as on March 31, 2021 to Rs. 9,358.51 crore as on March 31, 2022. Profit after tax and other comprehensive income was higher at Rs. 21.86 crore for FY 2021-22 as compared to Rs. 8.87 crore in FY 2020-21. Net worth of the Company increased from Rs. 9,261.10 crore as on March 31, 2021 to

Rs. 9,284.77 crore as on March 31, 2022. During the year, the Company transferred Rs. 4.39 crore to Special Reserve u/s 45-IC of Reserve Bank of India (“RBI”) Act, 1934. Details of business overview and outlook of the Company and its subsidiaries are appearing in the chapter Management Discussion and Analysis which forms part of this report.

DIVIDEND

The Board of Directors has not recommended any dividend for FY22. The Board of Directors declared an Interim dividend of Re. 1/- per share in April 2022 and the same was paid to shareholders on May 02, 2022.

DIVIDEND DISTRIBUTION POLICY

In accordance with the Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI LODR Regulations”), IDFC had formulated a Dividend Distribution Policy. The policy was adopted to set out the parameters and circumstances that will be considered by the Board in determining the distribution of dividend to its Shareholders and / or retaining profits earned by the Company. The said policy is hosted on the website of the Company and can be viewed at http://www.idfclimited. com/investor_ relations/corporate_ governance_policies.htm.

SUBSIDIARY COMPANIES

The Company has seven domestic direct indirect subsidiaries, one foreign indirect subsidiary, four Associate Companies and two Joint Ventures as on March 31, 2022 which are given in Table 1.

IDFC Asset Management Company Limited

The Board of Directors of IDFC and the Board of Directors of IDFC FHCL at their respective meetings held on April 06, 2022, have inter alia considered binding bids received in connection with divestment of IDFC AMC along with IDFC AMC Trustee Company Limited

PROPOSED MERGER OF SUBSIDIARIES

In order to simplify corporate structure and to bring synergy, the Board of Directors ('the Board') of IDFC Limited at its meeting held on November 09, 2021 had inter alia considered and approved the Scheme of Amalgamation of IDFC Alternatives Limited (Transferor Company 1), IDFC Trustee Company Limited (the Transferor Company 2) and IDFC Projects Limited (the Transferor Company 3) (wholly owned subsidiary Companies) into IDFC Limited (Transferee Company) subject to regulatory approvals from various authorities, as applicable. The Registrar of Companies, Chennai upon receipt of the proposed scheme and Form CAA-9 has intimated the Transferor Company 1, the Transferor Company 2, the Transferor Company 3, and the Transferee Company that it has no observations/ suggestions to the present scheme of amalgamation vide letter dated February 01, 2022. On February 06, 2022, the Shareholders of IDFC Limited through postal ballot had approved the aforesaid scheme of amalgamation. The Official Liquidator attached to the Madras High Court has intimated the Transferor

(“IDFC AMC Trustee”) and have approved sale of the entire shareholding of IDFC AMC and IDFC AMC Trustee held by IDFC FHCL to a consortium comprising of Bandhan Financial Holding Limited, Lathe Investment Pte. Ltd. (affiliate of GIC), Tangerine Investments Limited and Infinity Partners (affiliates of ChrysCapital) (“Proposed Transaction”). The Proposed Transaction will be completed upon receipt of requisite regulatory and other approvals, as applicable, and completion of closing related actions mutually agreed between the parties.

The gross consideration for the Proposed Transaction is Rs. 4,500 crores on a fully diluted basis and subject to customary price adjustments at the closure. This consideration is in addition to receipt of Rs. 250 crores as dividend from IDFC AMC in March 2022. The necessary applications have been made to concerned authorities/ regulators.

On July 07, 2022, the Shareholders of IDFC through postal ballot have approved the divestment/ sale/ disposal of the IDFC Asset Management Company Limited (material subsidiary of IDFC Limited) and IDFC AMC Trustee Company Limited.

Company 1, the Transferor Company 2 and the Transferor Company 3 that it has no observations/suggestions to the present scheme of amalgamation vide letter dated March 24, 2022. Approval from Regional Director / National Company Law Tribunal is awaited. Effective date of the merger is April 01, 2021. Post receiving all approvals, effect of merger will be given.

IDFC FOUNDATION

In FY 21-22, IDFC Foundation (“the Foundation”) through its division, IDFC Institute primarily focused on select projects of social and environment importance. The Foundation provides in-depth, actionable research and recommendations that are grounded in a contextual understanding of the political economy of execution. The Foundation approach to public policy issues rests on a solid foundation of evidence-based research. The Institute's research focuses on two broad areas: a) growth and job creation in the context of India's transition from farm to non-farm, rural to urban and informal to formal economic activity; and b) redefining the relationship between state and citizen to one of equals to improve the public delivery of essential services and welfare.

Ol SUBSIDIARY COMPANIES

SR.

NO.

NAME OF THE SUBSIDIARY

DIRECT / INDIRECT SUBSIDIARY

% OF SHAREHOLDING

Domestic Subsidiaries

l

i.

IDFC Financial Holding Company Limited (“IDFC FHCL”)

Direct

100%

ii.

IDFC Foundation (a Company within the meaning of section 8 of the Companies Act, 2013)

Direct

100%

iii.

IDFC Projects Limited

Direct

100%

iv.

IDFC Alternatives Limited

Direct

100%

v.

IDFC Trustee Company Limited

Direct

100%

vi.

IDFC AMC Trustee Company Limited

Indirect through IDFC FHCL

100%

vii.

IDFC Asset Management Company Limited (“IDFC AMC”)

Indirect through IDFC FHCL

99.96%

Foreign Subsidiaries

i.

IDFC Investment Managers (Mauritius) Ltd.

Indirect through IDFC FHCL

99.96%

Associate

! i.

Novopay Solutions Private Limited

Direct

23.83%

ii.

IDFC FIRST Bank Limited

Indirect through IDFC FHCL

36.49%

iii.

IDFC FIRST Bharat Limited

Indirect through IDFC FIRST Bank

36.49%

iv.

Jetpur Somnath Tollways Private Limited

Indirect through IDFC Projects Limited

26%

Joint Ventures

i.

Delhi Intigrated Multi - Modal Transit System Limited

Indirect through IDFC Foundation

50%

ii.

i

Ý_______

Infrastructure Development Corporation (Karnataka) Limited (“iDeck”)

Indirect through IDFC Foundation

49.49%

I

The Foundation conducted sero-surveys in Delhi, Mumbai and Thane to assess the impact of the second wave and of the vaccination campaign. These studies, showing over 80% seroprevalence in children, contributed to the decision to reopen schools in both Mumbai and Delhi.

The Foundation launched The Indian COVID-19 Alliance (TICA) to develop a vaccination strategy in India with a focus on vaccine allocation, distribution, communication and financing. Foundation conducted a series of studies to better understand vaccine hesitancy and confidence in Punjab and Karnataka (February 2021), West Bengal (March-June 2021) and Maharashtra (June 2021). Their findings were presented to the Ministry of Health and Family Welfare as part of a national consultation on vaccine hesitancy. Building on these findings, they collaborated with the Health Department of the Government of Punjab to support their COVID-19 Vaccination Communication efforts.

The Foundation also engaged with policies put out by ministries by submitting comments on the 'Draft National Geospatial Policy (2021)' in June, 2021 and the 'Proposed amendments to the Consumer Protection (e-commerce) Rules' in July 2021. In addition to this, it also engaged with the Punjab government by offering guidance to the Department of Governance Reforms & Public Grievances on implementing their state data policy.

PROPOSED MERGER OF IDFC, IDFC FHCL AND IDFC FIRST BANK

The Boards of IDFC, IDFC FHCL and IDFC FIRST Bank at their respecting meetings held on December 30, 2021 have accorded in-principle approval to merge IDFC and IDFC FHCL with IDFC FIRST Bank post further simplification of corporate structure and divestment of IDFC AMC.

CONSOLIDATED FINANCIAL STATEMENTS

The Board of Directors of IDFC reviews the affairs of its subsidiary companies regularly. In accordance with the provisions of Section 129(3) of the

Companies Act, 2013 (“the act”), the Company has prepared Consolidated Financial Statements including requisite details of all the subsidiaries. Further, a statement containing the salient features of performance and financial positions of all the subsidiary companies / associates/ joint ventures in the format AOC-I is appended as Annexure 1. In accordance with Section 136 of the Act, the Audited Financial Statements together with the Consolidated Financial Statements and related information of the Company and audited accounts of each subsidiary company are available on the website of the Company: www.idfclimited.com. Detailed analysis of the performance of IDFC and its businesses, including initiatives in the areas of Risk Management, Human Resources and IDFC Foundation activities, have been presented in the section on Management Discussion & Analysis which forms part of this Annual Report.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

IDFC had 6 employees as on March 31,

2022 and 328 employees at the group level (holding and subsidiaries). In terms of the provisions of Section 197(12) of the Act, read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended from time to time, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules is provided in this Annual Report. Having regard to the provisions of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the Shareholders of the Company. The said information is available for inspection at the Registered Office and Corporate Office of the Company during working hours and any Member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request. Disclosure pertaining to remuneration & other details as required under section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as

amended from time to time, are appended as Annexure 2.

SHARE CAPITAL UPDATE

During the year, the Company issued and allotted 77,626 equity shares to eligible employees of IDFC on exercise of options granted under Employee Stock Option Scheme 2016 (“IDFC ESOS -2016”). As on March 31, 2022, the total paid up capital of IDFC was 1,59,64,35,942 equity shares of Rs. 10 each.

MANAGEMENT DISCUSSION ANALYSIS AND REPORT ON CORPORATE GOVERNANCE

In compliance with Regulation 34 of SEBI LODR Regulations, separate detailed chapters on Management Discussion & Analysis, Report on Corporate Governance and Additional Shareholder Information forms part of this Annual Report.

BUSINESS RESPONSIBILITY REPORT

As per Regulation 34(2)(f) of SEBI LODR Regulations and Notifications issued from time to time, a separate report called Business Responsibility Report (“BRR”) describing the initiatives taken by IDFC from an environmental, social and governance perspective is hosted on the Company's website: www.idfclimited.com which forms part of this Annual Report.

PUBLIC DEPOSITS

During FY22, your Company has not accepted any deposits from the public within the meaning of the provisions of the Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998 or under Chapter V of the Act.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Post demerger of financing undertaking into IDFC Bank w.e.f. October 1, 2015,

IDFC is registered with RBI as NBFC -Investment Company. Being an investment company, the provisions of Section 186 of the Act are not applicable to IDFC. Hence, the requisite details of loans, guarantees and investments are not given.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

IDFC has put in place a Whistle Blower Policy, which includes reporting to the Management instances of unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct. The Audit Committee directly oversees the Vigil Mechanism. The provisions of the policy are also in line with the provisions of Section 177 (9) & (10) of the Act. The details of Whistle Blower Policy / Vigil Mechanism are posted on the website of the Company: www.idfclimited. com. There were no instances reported during the year.

FOREIGN EXCHANGE

There were no foreign exchange earnings or expenditure during the year under review.

PARTICULARS REGARDING CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

Since the Company does not carry out any manufacturing activity, the particulars regarding conservation of energy, technology absorption and other particulars as required by Section 134(3) (m) of the Act read with the Companies (Accounts) Rules, 2014 are not applicable to IDFC.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Shareholders of the Company, at its 21st AGM held on July 31, 2018, appointed Mr. Vinod Rai (DIN: 00041867) as an Independent Non-Executive Director for the second term for a period of 3 (three) consecutive years, from July 31, 2018 to July 30, 2021. The Nomination and Remuneration Committee and the Board of Directors of IDFC Limited, at their respective meetings held on May 25, 2021 changed the designation of Mr. Vinod Rai as Non-Independent NonExecutive Director from Independent Non Executive Director on the Board of IDFC Limited with immediate effect & up to May 22, 2023 subject to approval of the Shareholders of the Company. At the 24th AGM of the Company held on September 22, 2021, proposal for an appointment

of Mr. Vinod Rai as Non-Independent Non-Executive Director on the Board of IDFC Limited did not receive the requisite votes, Mr. Vinod Rai vacated the office with immediate effect. The Board places on record its sincere appreciation for his long association and valuable contribution to IDFC.

The Nomination and Remuneration Committee and the Board of Directors of IDFC Limited, at their respective meetings held on May 25, 2021 also proposed the appointment of Dr. Jaimini Bhagwati (DIN: 07274047) and Mr. Anil Singhvi (DIN: 00239589) as Additional Directors in the category of Independent Director of the Company with immediate effect for a consecutive period of 3 (three) years.

The Shareholders of the Company at its 24th AGM held on September 22, 2021, approved the appointment of Dr. Jaimini Bhagwati and Mr. Anil Singhvi as Independent Directors of the Company for a period of 3 years. The Board of Directors at its meeting held on December 22, 2021, approved appointment of Mr. Anil Singhvi as the Chairman of the Board with immediate effect.

The Nomination and Remuneration Committee and the Board of Directors of IDFC Limited, at their respective meetings held on October 30, 2021 and November 09, 2021, proposed the appointment of Ms. Anita Belani (DIN: 01532511) as an Additional Director in the category of Independent Director of the Company with immediate effect for a consecutive period of 3 (three) years, subject to the approval of Shareholders.

On February 06, 2022, the Shareholders of IDFC through postal ballot had approved the appointment of Ms. Anita Belani as an Independent Director of the Company for a consecutive period of 3 (three) years.

The Board of Directors of IDFC Limited at its Meeting held on August 14, 2019 had appointed Ms. Ritu Anand as an Additional Director in the category of Independent Director w.e.f. August 16, 2019. At the 22nd AGM held on September 30, 2019, the Shareholders of the Company had approved her appointment as an

Independent Director for a period of three (3) consecutive years w.e.f. August 16, 2019 till August 15, 2022. Accordingly, Ms. Ritu Anand has completed her term of 3 (three) consecutive years at the close of business hours on August 15, 2022 and hence, ceased to be an Independent Director of the IDFC Limited.

The Nomination and Remuneration Committee and the Board of Directors of IDFC, at their respective meetings held on August 24, 2022 accepted the resignation of Mr. Mahendra N Shah as Company Secretary and Compliance Officer of IDFC at the close of business hours on August 24, 2022. The Board also approved appointment of Mr. Mahendra N Shah (DIN: 00124629) as Managing Director -Designate of the Company with immediate effect. The term of Mr. Sunil Kakar (DIN: 03055561) as Managing Director & CEO of the Company will end on September 30, 2022. Mr. Mahendra N Shah will be the Managing Director of the Company w.e.f. October 01, 2022 till September 30, 2023 subject to approval of the shareholders of IDFC and other applicable statutory/ regulatory approvals. The Board also appointed Ms. Shivangi Mistry as the Company Secretary and Compliance Officer of the Company w.e.f. August 25, 2022.

FRAMEWORK FOR APPOINTMENT OF DIRECTORS

The Company has in place a framework for Board Diversity, Fit & Proper Criteria and Succession Planning for appointment of Directors on the Board of the Company.

DECLARATION OF INDEPENDENCE

The Company has received a declaration from all IDs that they meet the criteria of independence specified under Section 149 of the Act, read with Rule 5 of the Companies (Appointment and Qualification of Directors) Rules, 2014 and Regulation 16(1)(b) of SEBI LODR Regulations for holding the position of ID and that they shall abide by the “Code for Independent Directors” as per Schedule IV of the Act. Pursuant to Companies (Accounts) Amendments Rules, 2019 Companies (Creation and Maintenance

of Databank of Independent Directors) Rules, 2019 and Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019 dated 22nd October, 2019, all Independent Directors on the Board of the Company completed registration on Data Bank.

SPECIAL BUSINESS

The Board of Directors recommends the following items under special business for approval of the Shareholders at the ensuing AGM:

i. Appointment of Mr. Mahendra N Shah (DIN: 00124629) as the Managing Director of the Company.

SHAREHOLDERS’ UPDATE BOARD AND ITS COMMITTEES

During the year, 17 Board Meetings and 5 Audit Committee Meetings were held. The Audit Committee was reconstituted on August 24, 2022, on cessation of Ms. Ritu Anand as an Independent Director of the Company w.e.f. August 15, 2022.

The Committee is chaired by Mr. Anil Singhvi (DIN: 00239589) and has Mr. Ajay Sondhi (DIN: 01657614) and Ms. Anita Belani (DIN: 01532511) as its Members.

All the recommendations made by the Audit Committee during the year were accepted by the Board. The details of the constitution and meetings of the Board, Audit Committee and other Committees held during the year are provided in the Corporate Governance Report which forms part of this Annual Report.

BOARD EVALUATION

Pursuant to SEBI LODR Regulations and the Act, the process indicating the manner in which formal annual evaluation of the Chairman, Directors, Board as a whole and Board level committee is given in the Corporate Governance Report, which forms part of this Annual Report.

NOMINATION &

REMUNERATION COMMITTEE / REMUNERATION POLICY

The Company has a policy in place for identification of independence, qualifications and positive attributes of Directors. IDFC has put in place a Remuneration Policy for the Directors, Key Managerial Personnel, Senior Management

and Other Employees. The remuneration of the Executive Director and KMPs is recommended by NRC to the Board for its approval.

AUDITORS

STATUTORY AUDITORS

At the 24th AGM of the Company held on September 22, 2021, the Shareholders had approved the appointment of KKC & Associates LLP (previously, Khimji Kunverji & Co LLP), Chartered Accountants, (FRN 105146W/W100621) as Statutory Auditors for a period of 3 years to hold office from the conclusion of the 24th AGM till the conclusion of the 27th AGM of the Company. KKC has confirmed that they are not disqualified from continuing as Statutory Auditors of the Company for FY22-23.

COST AUDIT

In terms of the Section 148 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, the Company is not required to undertake cost audit.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Act and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed Bhandari & Associates, Company Secretaries to undertake the Secretarial Audit of the Company for FY22. The Secretarial Audit Report is appended as Annexure 3. There are no qualifications or observations or adverse remarks made by the Statutory Auditors and Secretarial Auditors in their respective reports.

COMPLIANCE WITH SECRETARIAL STANDARDS

Pursuant to the Secretarial Standard-I issued by the Institute of Company Secretaries of India pertaining to Board of Directors, the Company confirms that all applicable Secretarial Standards have been duly complied with during the period under review.

INTERNAL CONTROL SYSTEMS

The Company has in place, adequate

systems of Internal Control to ensure compliance with policies and procedures.

It is being constantly assessed and strengthened with new / revised standard operating procedures and tighter Information Technology controls. Internal Audit of the Company is regularly carried out. The Audit Reports of Internal Auditors i.e. M/s Grant Thornton India LLP(“GT”) along with their recommendations and implementation contained therein are regularly reviewed by the Audit Committee.

GT verified the key Internal Financial Control by reviewing key controls impacting financial reporting and overall risk management procedures of the Company and found the same satisfactory. Subsequently, it was placed before the Audit Committee of the Company.

RISK MANAGEMENT POLICY

IDFC as a group, has a robust risk management practice that enables it to book, manage and mitigate risks in all its businesses. The Company has a comprehensive Enterprise Risk Management framework which has been adopted across all entities in the group and covers all three types of risks—credit, market and operational risks. The Board through its Risk Management Committee monitors and reviews risk management of the group on a regular basis. The details of Risk Management Framework are provided in Management Discussion and Analysis.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments, affecting the financial position of IDFC which has occurred between the end of FY22 and the date of this Board's report.

INSTANCES OF FRAUD REPORTED BY THE AUDITORS

There have been no instances of fraud reported by the Auditors under Section 143(12) of the Act.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS / TRIBUNALS

During the year under review, there were no significant and material orders passed by the Regulators / Courts / Tribunals.

PROCEEDINGS UNDER INSOLVENCY AND BANKRUPTCY

During the year under review, the Company has not made any application nor any proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016.

ANTI SEXUAL HARASSMENT POLICY

The Company has in place the policy on Anti Sexual Harassment. The Company undertakes ongoing trainings to create awareness on this policy. There were no instances of Sexual Harassment that were reported during the period under review. The Company has constituted an Internal Complaints Committee for redressal of complaints and to prevent sexual harassment.

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Act:

In that in the preparation of the annual financial statements for the year ended March 31, 2022, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

^ In that such accounting policies have been selected and applied consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the Profit of the Company for the year ended on that date;

^ In that proper and sufficient care has been taken for the maintenance of adequate accounting records in

accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

^ In that the annual financial

statements have been prepared on a going concern basis;

^ In that proper internal financial

controls were in place and that the financial controls were adequate and were operating effectively;

^ In that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

GREEN INITIATIVE

In accordance with the 'Green Initiative', the Company has been sending the Annual Report / Notice of AGM in electronic mode to those Shareholders whose e-mail Ids are registered with the Company and / or the Depository Participants. Your Directors are thankful to the Shareholders for their active participation in this Green Initiative.

ANNUAL RETURN

The Annual Return of the Company has been placed on the website of the Company www.idfclimited.com in compliance with the provisions of section 134(3)(a) read with section 92(3) and the Rules made thereunder.

CORPORATE SOCIAL RESPONSIBILITY

The Corporate Social Responsibility (“CSR”) was re-constituted on June 09, 2021. Dr. Jaimini Bhagwati was inducted as the Chairman of the CSR Committee w.e.f. June 09, 2021. The CSR Committee consists of three Directors:

i. Dr. Jaimini Bhagwati (DIN: 07274047), Chairman

ii. Mr. Ajay Sondhi

(DIN: 01657614), Member

iii. Mr. Sunil Kakar

(DIN: 03055561), Member

The disclosure of contents of the Corporate Social Responsibility Policy of the Company as prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014 forms part of the Board's Report and appended as Annexure 4.

RELATED PARTY TRANSACTIONS

The Company has in place the policy on Related Party Transactions and the same has been uploaded on the website of the Company i.e. www.idfclimited.com. In all related party transactions that were entered into during the financial year, an endeavor was made consistently that they were on an arm's length basis and were in the ordinary course of business. IDFC has always been committed to good corporate governance practices, including matters relating to Related Party Transactions.

Since all related party transactions entered into by the Company were in the ordinary course of business and were on an arm's length basis, Form AOC-2 is not applicable to the Company. No Material Related Party Transactions, i.e. transactions exceeding 10% of the annual consolidated turnover of the Company as per the last audited financial statements, were entered during the year by your Company.

EMPLOYEE STOCK OPTION SCHEME

Pursuant to the resolution passed by the Members through Postal Ballot dated June 25, 2016, IDFC introduced IDFC Employee Stock Option Scheme, 2016 (“IDFC ESOS 2016”) to enable the employees of IDFC and its subsidiaries to participate in the future growth and financial success of the Company.

The Scheme is in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014.

Pursuant to IDFC Employee Stock Option Scheme 2016 (ESOS), the Company, on May 10, 2021, has granted to an employee 12,00,000 options equivalent to 12,00,000 equity shares at a strike price of Rs. 53.60 per equity share. The vesting period and exercise period will be as per the said ESOS scheme.

The Company determines the fair value of options using the Black Scholes model which considers the exercise price, the term of the option, share price at grant date, expected price volatility, dividend yield and risk-free interest rate for the term of the option. The fair value so determined is charged to profit & loss

account as employee benefit expense over the vesting period of the grant.

Disclosures as required under the SEBI (Share Based Employee Benefits Regulations, 2014, are hosted on the Company's website: www.idfclimited.com which forms part of this Annual Report.

ACKNOWLEDGEMENTS

We are grateful to the Government of India, State Governments, RBI, SEBI, Stock Exchanges, various Ministries and other domestic and overseas regulatory bodies for their continuous collaboration and support. We would like to thank all our Shareholders, Banks for their co-operation and assistance during the year under review.

We would like to express our deep sense of appreciation for the hard work and efforts put in by the employees at all levels of the Group.

FOR AND ON BEHALF OF THE BOARD IDFC LIMITED

ANIL SINGHVI

Independent Non-Executive Chairman New Delhi August 24, 2022

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Company Identification Number (CIN): Acumen Capital Market (I) Ltd. – U67120KL1995PLC008674; Acumen Commodities (I) Ltd. – U51109KL2003PLC016493; Grand Finance and Estates Pvt. Ltd. – U65910KL1995PTC009201