(Report of Implementation and Monitoring Committee)

DEAR MEMBERS,

The Reserve Bank of India (RBI) vide Press Release dated October 4,2021 in exercise of
the powers conferred under Section 45-IE(1) of the Reserve Bank of India Act, 1934 (RBI
Act) superseded the Board of Directors of your Company on October4,2021 and appointed Mr.
Rajneesh Sharma, as the Administrator of your Company under Section 45-IE (2) of the RBI
Act.

On October 8,2021, the RBI had filed a Petition before the Hon'ble National Company Law
Tribunal, Kolkata Bench (Hon'ble NCLT / Adjudicating Authority) under Section 227 read
with Section 239(2)(zk) of the Insolvency and Bankruptcy Code, 2016 (IBC / IBC Code/Code)
read with Rules 5 and 6 of the Insolvency and Bankruptcy (Insolvency and Liquidation
Proceedings of Financial Service Providers and Application to Adjudication Authority)
Rules, 2019 (FSP Rules), to initiate Corporate Insolvency Resolution Process (CIRP)
against your Company. Thereafter, CIRP was initiated against your Company by an Order
dated October 8, 2021 of the Hon'ble NCLT. The Hon'ble NCLT, vide the said Order,
confirmed the appointment of the Administrator to perform the functions of an interim
resolution professional / resolution professional and to complete the CIRP of your Company
as required under the provisions of the Code and had also announced commencement of the
moratorium under Section 14 of the Code with effect from October 8,2021.

Thereafter, RBI vide its Press Release dated October 11,2021, in exercise of the powers
conferred under Section 45-IE 5(a) of the RBI Act, constituted a three (3) member Advisory
Committee to assist the Administrator in discharge of his duties and to advise the
Administrator in the operations of your Company during the Corporate Insolvency Resolution
Process (CIRP). As per the framework of the Advisory Committee as approved by RBI, primary
responsibility of the Advisory Committee is to guide the Administrator to undertake all
steps that will maximize the value for all stakeholders of your Company through a
successful resolution. Since the Administrator also takes over the responsibility of the
Board of Directors of your Company, the Advisory Committee will support the administrator
in fulfilment of such role and responsibilities. Initially the Advisory Committee
consisted of Shri R. Subramaniakumar, former MD&CEO, Indian Overseas Bank, Shri TT
Srinivasaraghavan, former Managing Director, Sundaram Finance Limited and Shri Farokh N
Subedar, former Chief Operating Officer and Company Secretary, Tata Sons Limited as
members. The Committee was reconstituted on June 22,2022 by the induction of Shri Venkat
Nageswar Chalasani, former Deputy Managing Director, State Bank of India consequent to
resignation of Shri R. Subramaniakumar. The Committee was further reconstituted on January
31,2023 by the induction of Shri V Ramachandra, former Chief General Manager, Canara Bank,
consequent to resignation of Shri Farokh N Subedar.

In accordance with the provisions of the Code and with the approval of the Committee of
Creditors (CoC) of your Company, the Administrator on February 25, 2022 invited
expressions of interest (EOI) from prospective resolution applicants on the basis of the
Request for Resolution Plan (RFRP), as approved by the CoC. On April 6, 2022, the final
list of Prospective Resolution Applicants (PRA) as per Regulation 36A(12) of Insolvency
and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons)
Regulations, 2016 read with FSP Rules were received and updated on the website of the
Company. Further, updations in the list of PRA's were made and the final revised list of
PRA's was shared on November 17,2022.

All the resolution plans were duly presented by the Administrator to the CoC at its
33rd meeting held on January 21,2023 for CoC's consideration. All the plans submitted by
the PRA's were duly given consideration to and the plan submitted by National Asset
Reconstruction Company Limited (NARCL) in respect of your Company was approved by 89.2.%
votes and was chosen as a successful resolution plan under Section 30(4) of the Code
(Resolution Plan).

The Administrator on 16th February, 2023 filed an application for obtaining
no-objection from the Reserve Bank of India (RBI) as required under Rule 5 of the
(Insolvency and Liquidation Proceedings of Financial Service Providers and Application to
Adjudication of Authority) Rules, 2019 against the Plan.

Thereafter, your Company received the said no-objection from the RBI via its letter
dated March 23, 2023 in terms of Rule 5(d)(iii) of the FSP Rules.

The Administrator had also filed an application under Section 30(6) of the Code before
the Hon'ble National Company Law Tribunal (NCLT), Kolkata on February 18,2023 for its
approval of the Plan.

The Hon'ble NCLT vide the Order passed on August 11,2023, approved the Resolution Plan
submitted by NARCL under Section 31 of the Code.

As per the Approved Resolution Plan, it is proposed that any existing encumbrance or
collateral (whether enforced, crystallized or proceeded with or not) over the assets of
the Corporate Debtors (created and/or perfected for debt availed by the Corporate Debtors
or a third party) (collectively "Security"), by operation of applicable law, or
in connection with any debt owed to financial creditors, operational creditors, other
creditors or any other debt or obligation of the Corporate Debtors, or in relation to a
third party (including a related party) whose obligations were secured by the Corporate
Debtors by creation of any Security in favour of another person, at any time till the
effective date (as per the Approved Resolution Plan), shall stand automatically
extinguished, revoked, released, cancelled, withdrawn, dismissed and deemed null and void
(as the case may be) and all financial obligations in relation to such Security shall be
permanently extinguished on the effective date on and with effect from the Plan Approval
Date.

In accordance with the terms of the Approved Resolution Plan, an Implementation and
Monitoring Committee (IMC) had been constituted for conducting the affairs of your Company
and supervising the implementation of the Resolution Plan until all the steps and actions
contemplated therein have been completed.

Further, upon the approval of the Resolution Plan by the Plan Approval Order and in
compliance with the directions of Hon'ble NCLT in the said Plan Approval Order, the
mandate of the RBI constituting the Advisory Committee as per RBI press release dated
October 4,2021, to advise the Administrator in the operations of your Company during the
CIRP and to assist him for discharging his duties was fulfilled. Therefore, the Advisory
Committee was dissolved and the same was also intimated to the respective Members of the
Advisory Committee.

A detailed summary highlighting the significant portion of the Approved Resolution Plan
along with the Order of the Hon'ble NCLT approving the Resolution Plan is hosted on the
website of the Company at www.srei.com and the same is also intimated to the stock
exchanges where the securities of the Company is listed vide letter dated August 12,2023.
The same is not repeated here for the sake of brevity.

The Boards Report (Report of Implementation and Monitoring Committee chaired by the
Administrator) is being taken on record by the Administrator and the Implementation and
Monitoring Committee Members (IMC).

The Thirty Eighth Annual Report together with the Audited Accounts of your Company for
the financial year ended March 31, 2023 is being presented. Since the Board of Directors
of your Company was superseded by the RBI under press release dated October 4, 2021, the
said following report is being presented by the Administrator and the Advisory Committee
of the Company in fulfilment of their duties under the Code. The summarised financial
performance of your Company is as follows.

KEY FINANCIALS FINANCIAL SUMMARY & STATE OF AFFAIRS

(?in Lacs)


  

    

    
Consolidated
    
Standalone
  
  

    
Particulars
    
As at March 31,2023
    
As at March 31,2022
    
As at March31,2023
    
As at March31,2022
  
  

    
Total Income
    
1,56,289
    
3,12,197
    
2,143
    
3,230
  
  

    
Total Expenses (including impairment on financial instruments, depreciation etc.)
    
2,51,554
    
5,59,577
    
2,419
    
4,583
  
  

    
Profit / (Loss) Before Exceptional Items & Tax
    
(95,265)
    
(2,47,380)
    
(276)
    
(1,353)
  
  

    
Exceptional Items
    
(10,15,593)
    
-
    
-
    
-
  
  

    
Profit / (Loss) Before Tax
    
(11,10,858)
    
(2,47,380)
    
(276)
    
(1,353)
  
  

    
Current Tax
    
49
    
252
    
-
    
-
  
  

    
Income Tax in respect of earlier year
    
6
    
6,881
    
5
    
(2,926)
  
  

    
Deferred Tax
    
(14)
    
(38)
    
-
    
-
  
  

    
Profit / (Loss) After Tax before adjusting Minority Interest
    
(11,10,899)
    
(2,54,475)
    
(281)
    
1,573
  
  

    
Non-Controlling Interest
    
(5)
    
56
    
-
    
-
  
  

    
Profit / (Loss) After Tax after adjusting Minority Interest
    
(11,10,894)
    
(2,54,531)
    
(281)
    
1,573
  
  

    
Surplus brought forward from previous year (Retained Earnings)
    
(15,95,389)
    
(1,218,576)
    
(2,56,117)
    
(2,57,398)
  
  

    
Other Comprehensive Income (net of tax)
    
(14,722)
    
(33,545)
    
15,626
    
(32,707)
  
  

    
Profit Available for Appropriation (Retained Earnings)
    
(27,51,978)
    
(15,95,389)
    
(2,56,374)
    
(2,56,117)
  
  

    
Paid up Equity Share Capital
    
50,309
    
50,309
    
50309
    
50,309
  
  

    
Other Equity excluding Revaluation Reserves
    
(17,52,283)
    
(6,56,101)
    
(62,376)
    
(77,721)
  
  

    
Earnings Per Share (Rs.)
    
(220.82
    
(50.58
    
(0.06)
    
0.31
  


OPERATIONAL REVIEW:

Some of the key highlights of your Company's standalone performance during the year
under review are:

• Total Income is?2,143 Lacs as against? 3,230 Lacs in the last year.

• Loss before taxation is ? 276 Lacs as against ? 1,353 Lacs in the last year.

• NetLossaftertaxationis? 281 LacsasagainstNetProfitof? 1,573 Lacsinthelastyear.

Standalone

During the Financial Year under review, the standalone and consolidated financial
statements for the year ended March 31,2023 have been prepared as per the Ind AS. For the
Financial Year under review, your Company suffered a Loss Before Taxes of? 276 Lacs as
against? 1,353 Lacs in the previous Financial Year and Loss After Tax for the year under
review is? 281 Lacsas against a Profit of? 1,573 Lacs in the previous Financial Year.

Consolidated

During the Financial Year under review, your Company's total revenue on consolidated
basis stood at? 1,56,289 Lacs as compared to? 3,12,197 Lacs in the previous Financial
Year. The overall operational expenses for the Financial Year under review were? 2,51,554
Lacs, as against ? 5,59,577 Lacs in the previous Financial Year. Operating Loss Before Tax
for the year under review stood at? 95,265 Lacs as compared to? 2,47,380 Lacs in the
previous Financial Year. The Loss After Taxforyearunderreview stood at? 11,10,899 Lacs as
against? 2,54,475 Lacs in the previous Financial Year.

Key Financial Ratios (in terms of Schedule V of Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015) areas under-


  

    
Particulars
    
2022-23 (%)
    
2021-22 (%)
  
  

    
Return on Net worth
    
Negative
    
Negative
  
  

    
Yield on Average Funds
    
Nil
    
Nil
  
  

    
Cost of Funds
    
10.00
    
10.00
  
  

    
Gross Interest Spread
    
Nil
    
Nil
  
  

    
Return on Average Assets on Books
    
Negative
    
Negative
  
  

    
Capital to Risk Assets Ratio (CRAR)
    
(31.09)%
    
(7.82) %
  


Ratios where there has been a significant change (i.e. change of 25 per cent or more as
compared to the immediately previous Financial Year) along with reasons thereof:

Return on Net worth is negative & Loss After Tax of your Company during the
Financial Year 2022-23 was ? 281 Lacs compared to Profit After Tax of ? 1,573 Lacs in
Financial Year 2021-22, while Networth stands at negative ? (4596) Lacs in Financial Year
2022-23 compared to negative ? (4452) Lacs in Financial Year 2021-22.

SEFL reported a loss after tax of? 11,219.28 Crores for the Financial Year ended March
31,2023 as compared to? 2,772.92 Crores for the Financial Year ended on March 31,2022. At
the end of the Financial Year, the Gross NPAs % of SEFL were 96.92% as against 71.52% in
the previous year. The net NPAs (excluding impairment Reserve) for SEFL were at the end of
the Financial Year under review is 91.80% as against 61.88% in the previous year. The net
NPAs (including impairment Reserve) for SEFL were at the end of the Financial Year is
83.49% as against 52.97% in the previous year.

Considering the above facts, your Company has assessed the carrying amount of its
investment in SEFL in compliance with Ind AS and has made an impairment provision of ?
3,104.55 Crores during the Quarter and Financial Year ended on March 31,2021 bringing down
the carrying amount ofits investment in SEFL to ? 1.This has resulted in negative net
worth of your Company.

Gross Interest Spread is computed as the difference between yield on average funds and
cost of funds. Since your Company has not done any lending business during the year, there
is no interest income and hence Gross Interest Spread is nil.

Return on Average Assets on Books is negative since there is loss in your Company due
to impairment provisions on Investments.

The Financial Statements of your Company have been prepared in accordance with Ind AS
and the relevant provisions of the Companies Act, 2013 and rules made therein, as
applicable and Regulation 48 of the Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as
'SEBI Listing Regulations, 2015'). Accounting policies have been consistently applied
except where a newly issued accounting standard, if initially adopted or a revision to an
existing accounting standard requires a change in the accounting policy hitherto in use.
Management evaluates all recently issued or revised accounting standards on an on-going
basis. Your Company discloses standalone and consolidated unaudited financial results on a
quarterly basis, which are subjected to limited review, and standalone and consolidated
audited financial results on an annual basis.

Your Company has been complying with all the norms prescribed by the Reserve Bank of
India (RBI) including the Fair Practices, Anti Money Laundering and Know Your Customer
(KYC) applicable during CIRP.

TRANSFER TO RESERVES

Your Company has not transferred any amount to reserves due to losses incurred during
the Financial Year ended on March 31,2023.

OPERATIONS

As part of the CIRP of your Company, the Administrator, Advisory Committee and the
present management team of your Company, under the guidance of the Administrator have
taken various initiatives to ensure "going concern" status of your Company as
required u/s20 of the Insolvency and Bankruptcy Code ("Code"). Further, the Code
and Regulations thereunder stipulate prior approval by the CoC for certain actions to be
taken during the process, including as provided u/s 28 of the Code. The Advisory Committee
as set up by the RBI to assist the Administrator in discharge of his duties, exercise
oversight on the operations of your Company apart from running the CIRP in accordance to
the provisions of the Code and Regulations under the Code. The Administrator has appointed
Ernst & Young LLP and AZB & Partners as process and Legal Advisors, respectively
to assist him in the Completion of the CIRP of your Company. Further, various internal
committees have been constituted / re-constituted by the Administrator with a view to have
a group of in-house executives of your Company who can help the business navigate its
compliance obligations.

The present management of your Company under the guidance of the Administrator has
undertaken various initiatives including efforts to strengthen the policies and processes,
functioning of the IT System, legal, internal audit, internal financial controls and
updating risk control matrices, information security, operational and credit management
risk and fraud risk management, through in-house resources and engagement of external
professional experts / consultants. The management team also initiated steps for
compliance of various applicable rules and regulations within your Company.

These initiatives contributed to strengthen your Company's overall governance structure
and control environment. On conclusion and complete implementation of all such
initiatives, it is expected that the operational efficiency will improve and operational
issues will get addressed.

DIVIDEND

Owing to the loss incurred by your Company for the Financial Year under review and due
to the ongoing CIRP, no dividend has been declared / recommended on the Equity Shares for
the Financial Year ended March 31, 2023.

PUBLIC DEPOSITS

Your Company decided not to accept any further public deposits or renew such maturing
deposits in any manner w.e.f. April 20,2010 and the entire amount of outstanding public
deposits as on April 19,2010 together with interest promised to the depositors, was kept
in an Escrow Account with a scheduled commercial bank for the purpose of making payment to
the depositors as and when they raise the claim. As on March 31,2023 your Company does not
have any unpaid / unclaimed deposits payable to the depositors.

Being a Non-Banking Non Deposit taking Company, your Company has not accepted any
deposits from the public / members under Section 73 of the Companies Act, 2013 read with
Companies (Acceptance of Deposits) Rules, 2014 during the year and within the meaning of
the provisions of the Non-Banking Financial Companies Acceptance of Public Deposits
(Reserve Bank) Directions, 2016.

PROMOTERS' GROUP SHAREHOLDING

As on March 31, 2023 the total shareholding of the Promoters' Group of your Company is
60.80 per cent and none of the Promoter / Promoters' Group shareholding is under pledge.
Further, in compliance with Regulation 31 (2) of SEBI Listing Regulations, 2015, the
entire shareholding of promoter(s) and promoter group is in dematerialised form.

TRANSFER OF LENDING BUSINESS, INTEREST EARNING BUSINESS & LEASE BUSINESS OF YOUR
COMPANY TO SREI EQUIPMENT FINANCE LIMITED AS A GOING CONCERN ON SLUMP EXCHANGE BASIS

During the Financial Year 2019-20, the Board of Directors of your Company and Srei
Equipment Finance Limited (SEFL), wholly owned subsidiary of your Company at their
respective meetings held on July 04,2019, had for the purposes of consolidation of lending
business approved the transfer, assignment and delivery of the Lending Business, Interest
Earning Business & Lease Business of your Company together with associated employees,
assets and liabilities (including liabilities towards issued and outstanding
non-convertible debentures), ("Transferred Undertaking") as a going concern by
way of slump exchange to SEFL through a Business Transfer Agreement (BTA), in exchange of
fully paid up equity shares to be issued and allotted by SEFL, subject to all necessary
approvals.

Pursuant to the aforesaid, BTA was signed and executed by your Company and SEFL on
August 16, 2019. Pursuant to the said BTA, the entire fund - based business division of
your Company alongwith all its assets and liabilities has been transferred to SEFL with
effect from October 01,2019. Further, an amendment to the aforesaid BTA was executed on
14th November, 2019 with SEFL. Pursuant to this, your Company has entered into various
assignment agreements, in connection with the Transferred Undertaking, with SEFL to give
effect of the slump exchange and accordingly your Company and SEFL has passed the relevant
accounting entries in their respective books of account effective October 01,2019, after
receiving the approval of the shareholders, debenture trustees, few ECB lenders, and stock
exchanges.

SEFL had also proposed the Schemes with its Creditors and the application to that
effect had been filed with the Hon'ble National Company Law Tribunal, Kolkata (Hon'ble
NCLT). BTA, inter alia, constituted an integral part of the Scheme. The Hon'ble NCLT vide
order dated October 21,2020, directed SEFL to hold meetings of the Creditors to vote on
the Scheme and the same was rejected by the Creditors and thus the slump exchange under
the BTA did not fructify. Pending final decision in the matter, SEFL and your Company had
maintained status quo for BTA as per the directions of Hon'ble NCLT.

After the commencement of CIRP, an Application was filed by the Administrator of your
Company seeking to withdraw the Scheme which has been allowed by the NCLTbyan order dated
February 11,2022 hence no further action was taken in this regard consequent upon the
withdrawal of Schemes as stated above. Accordingly, the status quo regarding Business
Transfer Agreement, as it existed on the date of commencement of the Corporate Insolvency
Resolution Process, has been maintained.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT ECONOMIC REVIEW

a. Global Outlook

The global economy faced unprecedented challenges in the wake of the COVID-19 pandemic,
which disrupted nearly every aspect of life and business. Financial Year 2022-23 marked a
critical period for the world economy as it navigated through the uncertainties of the
pandemic's aftermath.

The global economy however is going for a gradual recovery from the powerful blows of
the pandemic and of Russia's war on Ukraine. China is rebounding strongly following the
reopening of its economy. Supply-chain disruptions are unwinding, while the dislocations
to energy and food markets caused by the war are receding. Simultaneously, the massive and
synchronous tightening of monetary policy by most central banks should start to bear
fruit, with inflation moving back toward its targets. In IMF's forecast, global growth
will bottom out at 2.8 percent in 2023 and would rise modestly to 3.0 percent in 2024.
Global inflation will decrease, although more slowly than initially anticipated, from 8.7
percent in 2022 to 7.0 percent in 2023 and 4.9 percent in 2024.

The Financial Year 2022-23 witnessed a gradual but uneven global economic recovery. The
International Monetary Fund (IMF) projected a growth rate of 5.9 percent, signalling a
rebound from the severe contraction experienced during the pandemic. However, this growth
was not uniform across all regions, and various factors influenced the pace of recovery.

Notably, emerging market and developing economies are already powering ahead in many
cases, with growth rates jumping from 2.8 percent in 2022 to 4.5 percent in 2023. The
slowdown is concentrated in advanced economies, especially the euro area and the United
Kingdom, where growth is expected to fall to 0.7 percent and -0.4 percent, respectively,
in 2023 before rebounding to 1.8and 2.0 percent in 2024.

The surge in global demand and supply chain disruptions contributed to inflationary
pressures during Financial Year 2022-23. Rising commodity prices, particularly in energy
and food sectors, resulted in higher production costs. Central banks grappled with the
challenge of balancing their accommodative stance with managing inflation expectations.

The Financial Year 2022-23 saw an increased focus on climate change and sustainable
development. Governments and businesses accelerated efforts to transition towards cleaner
energy sources and adopt environmentally responsible practices. Sustainable finance gained
prominence as investors sought to support initiatives that aligned with environmental,
social, and governance (ESG) principles.

The pandemic accelerated the adoption of digital technologies and spurred innovation
across industries. Remote work, e-commerce, and digital services became essential
components of the new economic landscape. Tech companies saw unprecedented growth, and
investment in areas like artificial intelligence, biotechnology, and renewable energy
surged.

b. Indian Scenario

The Indian economy, however, appears to have moved on after its encounter with the
pandemic, staging a full recovery in Financial Year 2022-23 ahead of many nations and
positioning itself to ascend to the pre-pandemic growth path in FY23. Yet in the current
year, India has also faced the challenge of reining in inflation that the European strife
accentuated. Measures taken by the Government and RBI, along with the easing of global
commodity prices, have finally managed to bring retail inflation below the RBI upper
tolerance target. However, the challenge of the depreciating rupee, although better
performing than most other currencies, persists with the likelihood of further increases
in policy rates by the US Fed. The widening of the Current Account Deficits (CAD) may also
continue as global commodity prices remain elevated and the growth momentum of the Indian
economy remains strong. The loss of export stimulus is further possible as the slowing
world growth and trade shrinks the global market size in the second half of the current
year.

Despite these, agencies worldwide continue to project India as the fastest- growing
major economy at 6.5-7.0 percent in Financial Year 2022-23 These optimistic growth
forecasts stem in part from the resilience of the Indian economy seen in the rebound of
private consumption seamlessly replacing the export stimuli as the leading driver of
growth. The uptick in private consumption has also given a boost to production activity
resulting in an increase in capacity utilisation across sectors. The rebound in
consumption was engineered by the near-universal vaccination coverage overseen by the
Government that brought people back to the streets to spend on contact-based services,
such as restaurants, hotels, shopping malls, and cinemas, among others.

Impact of the Second Wave

India had faced a major setback due to the second waveofCOVID-19. The wave was more
virulent and overwhelmed the healthcare system, resulting in a significant loss of lives.
The second wave had also posed challenges to economic activities as localised lockdowns
impacted businesses and consumer sentiment.

Fiscal and Monetary Policies

The Indian Government and RBI implemented several fiscal and monetary measures to
support the economy during the Financial Year 2022-23. The government continued with its
expansionary fiscal policy, focusing on infrastructure spending, rural development, and
social welfare schemes to stimulate demand and employment.

The RBI maintained an accommodative monetary policy stance, keeping interest rates at
historic lows to support credit growth and investment. The Central Bank also provided
liquidity support to financial institutions and introduced targeted measures for sectors
affected by the pandemic.

Trade and External Sector

India's trade balance remained under pressure during Financial Year 2022-23 due to
disruptions in global supply chains and fluctuations in commodity prices. The pandemic's
impact on global demand and supply constrained export growth, leading to a lower trade
surplus compared to previous years. However, the country's foreign exchange reserves
remained robust, providing a buffer against external shocks.

Inflation and Price Pressures

Inflationary pressures were a significant concern during Financial Year 202223. Rising
commodity prices, supply chain disruptions, and an increase in fuel and food prices
contributed to elevated inflation levels. The RBI closely monitored inflation dynamics and
aimed to strike a balance between supporting growth and managing price stability.

Financial Sector and Banking

The financial sector underwent significant changes during Financial Year 2022-23. The
RBI introduced various regulatory amendments to strengthen the banking and non-banking
financial company (NBFC) sectors. Measures were taken to address asset quality challenges
and liquidity risks faced by financial institutions due to the pandemic.

Focus on Atmanirbhar Bharat

The Indian Government continued to emphasize the "Atmanirbhar Bharat"
(self-reliant India) initiative during Financial Year 2022-23. The aim was to boost
domestic manufacturing and reduce import dependence, especially in critical sectors. The
government announced various schemes and incentives to promote local manufacturing and
exports.

Outlook for India

The outlook for India during Financial Year 2022-23 remained cautiously optimistic as
the economy recovered significantly from the impact of the second wave, driven by the
on-going vaccination drive and the gradual reopening of economic activities. The
government's focus on infrastructure development, rural economy, and social welfare
schemes is likely to support growth and job creation.

India, currently holding the prestigious Presidency of G20 nations, has grown from
being the tenth largest economy ten years ago to the fifth largest today. India has been
the fastest growing major economy for the third year in a row and is poised for further
growth, driven strongly by, among other factors, a robust and diverse technological
ecosystem. Diverse and inclusive new-age skilled talent pool with strong entrepreneurial
mindset people, fast innovation, responsible & ethical tech & governance built on
trust, commitment to Environmental, Social & Governance (ESG) goals, form the
cornerstones of this vibrant ecosystem.

NBFCs IN INDIA

Non-Banking Financial Companies (NBFCs) in India have played a crucial role in
addressing the funding needs of segments often excluded from formal institutional
financing. In Financial Year 2022-23, the sector faced significant challenges,
particularly in the aftermath of the pandemic's impact.

Financial Year 2022-23 began with the lingering impact of the COVID-19 pandemic on the
NBFC sector. The pandemic-induced economic downturn led to a sharp reduction in cash flows
for many borrowers, affecting the ability of NBFCs to recover dues. Consequently, there
was a rise in stressed assets, leading to liquidity challenges and concerns over the
financial stability of certain NBFCs.

To mitigate the pandemic's impact on the financial system, the Reserve Bank of India
(RBI) introduced several regulatory measures aimed at providing relief to NBFCs and their
borrowers:

• Moratorium on Loan Payment: NBFCs were permitted to grant a moratorium on loan
instalments for stressed borrowers for up to six months. This move provided temporary
relief to borrowers facing financial hardships due to the pandemic.

• Targeted Long-Term Repo Operations (TLTRO) :The RBI initiated TLTRO 2.0,
allowing NBFCs to avail up to ? 1 trillion at the policy repo rate. This liquidity support
was channelled into investment grade bonds, commercial papers, and non-convertible
debentures of NBFCs, thereby easing their funding challenges.

• One-Time Loan Restructuring: In response to the economic disruption caused by
the pandemic, NBFCs were allowed to restructure stressed loan accounts of affected
borrowers, providing them with additional time to repay their loans.

• To enhance credit flow and support priority sectors, the RBI introduced the
co-lending model. Under this model, banks and NBFCs collaborated to extend credit to
specified categories of borrowers, with the funding ratio set at 80:20.The co-lending
model aimed to leverage the strengths of both banks and NBFCs to reach a wider range of
borrowers.

Classification of NBFCs

The RBI proposed a four-layered classification of NBFCs based on parameters such as
asset size, liabilities, and systemic importance. The proposed classification aimed to
tailor regulatory requirements according to the risk profile and significance of each NBFC
in the financial system.

Liquidity Schemes

To address liquidity challenges faced by NBFCs, the Government introduced liquidity
schemes. The Special Liquidity Scheme, with an allocation of? 300 billion, allowed
investments in primary and secondary markets in investment- grade debt papers of NBFCs,
housing finance companies, and micro-finance institutions. Additionally, the Partial
Credit Guarantee Scheme 2.0 provided coverage for borrowings involving sub-AA ratings and
unrated papers.

Asset Quality and Liquidity Risks

The NBFC sector encountered renewed asset quality risks and liquidity challenges in
Financial Year 2022-23, particularly during the second wave of the pandemic. The second
wave's widespread impact extended to hinterland areas where many NBFCs' clients resided,
making it more challenging for the sector to recover.

Non-Banking Financial Corporations (NBFCs) have emerged as the primary source of
financing for a vast section of the population including SMEs and have been able to meet
the diverse requirements of borrowers in the most efficient and timely approach
considering their wide geographic reach, comprehension of the numerous financial needs,
and extremely swift turnarounds. Therefore, NBFCs have contributed significantly to the
cause of financial inclusion in this process and have also been a key component in
fostering the expansion of millions of MSMEs and self-employed people.

NBFCs have also contributed towards the development of the Country's infrastructure.
The availability of long-term funding by them has helped in the financial closure and
growth of many large-scale infrastructural projects. NBFCs have played a crucial role in
fostering credit expansion across various sectorsandverticals.

NBFCs have become increasingly important in India owing to the use of technology to
reach wider audiences. Many NBFCs have developed digital platforms that allow customers to
apply for loans online, making the process faster and more convenient.

However, NBFCs also have their share of challenges. One of the biggest challenges
facing NBFCs in India is access to funding. Unlike banks, which have access to low-cost
deposits, NBFCs must rely on borrowing from banks or issuing bonds to raise funds. This
can make it difficult for NBFCs to compete with banks on interest rates. Another challenge
faced by NBFCs is the regulatory environment. While the RBI regulates NBFCs, there are
also several other regulators that oversee different aspects of the financial services
industry. This can create confusion for NBFCs, especially those that operate across
multiple states or regions. Despite these challenges, NBFCs have continued to grow in
India. The government is taking several measures to ease the challenging situations
prevailing in the sector by way of providing liquidity support to NBFCs, HFCs, as well as
MFIs and introducing partial credit guarantee schemes, etc.

Outlook for NBFCs in India

The outlook for NBFCs in Financial Year 2022-23 remains cautiously optimistic, but the
sector faces several challenges. As the economy gradually recovers from the pandemic's
impact, the demand for credit may rise, providing growth opportunities for NBFCs.

However, NBFCs must manage their asset quality diligently, closely monitor borrowers'
repayment capabilities, and adhere to prudent lending practices. The Central Bank's
regulatory support measures and the co-lending model are expected to bolster the sector's
ability to meet credit demands.

Operational challenges and liquidity constraints could pose hurdles for smaller and
medium-sized NBFCs. The securitization market's adverse impact may limit their fundraising
options, necessitating Government and RBI support to ensure a vibrant NBFC sector.

For the broader Indian economy and MSMEs, a robust NBFC sector is vital. Therefore, the
Government and RBI must continue providing regulatory support, liquidity measures, and
tailored solutions to strengthen the NBFC ecosystem.

Emerging Prospects of NBFCs in the Indian Financial Landscape

In 2023, non-bank lenders will concentrate on restoring growth by improving asset
quality supported by rising retail demand and liquidity, according to a recent analysis by
ICRA. The MSME sector and other growing sectors will see more participation from NBFCs as
part of the same.

Compared to 15 to 20 years ago the industry's on-going competitiveness shows that it is
expanding. Even though banks will continue to compete in the market, NBFCs will remain an
important player because of their wider reach, increased flexibility, and cutting-edge
digital solutions.

Conclusion

The NBFC industry accelerates the Country's economic growth. The RBI is continually
working to make the required modifications to the NBFC regulatory framework in order to
proactively give regulatory assistance to the sector and maintain long - term financial
stability. In 2023, NBFCs will make a more significant impact on the socio - economic
structure of the Indian economy. The potential for credit penetration in India is still
relatively high. NBFCs may establish a new standard by working with fintech and creating
new business models with specialised goods.

Financial Year 2022-23 was a crucial period for NBFCs in India, marked by challenges
posed by the pandemic and regulatory interventions aimed at alleviating the sector's
liquidity constraints and supporting economic recovery. The sector's outlook remains
dependent on effective risk management, regulatory compliance, and a cautious approach to
credit growth. With continued government and RBI support, a resilient and vibrant NBFC
sector can play a vital role in promoting financial inclusion and contributing to the
nation's economic growth and development.

BUSINESS OUTLOOK AND FUTURE PLANS

Your Company is registered with the Reserve Bank of India (RBI) as a systemically
important non-deposit taking NBFC however, due to establishment of TRA Account and
pursuant to initiation of CIRP, your Company has discontinued the NBFC activities expect
for the continuing PFI activities. The management of your Company is closely tracking the
financial market dynamics / opportunities in order to source business opportunities and
make the business verticals future ready with investor identification process reaching its
legitimate closure.

1. INFRASTRUCTUREPROJECTADVISORY

Your Company is significant player in Infrastructure Project Advisory Services. The
Infrastructure Project Advisory Division of your Company has established its presence
across the infrastructure spectrum as strategic advisors to Central/State Governments,
Statutory Bodies, PSUs and Urban Local Bodies in India and abroad. Your Company offers
advisory, consultancy and other allied value added services from concept to commissioning
in different domains of Infrastructure - majorly Urban and Industrial precincts. All the
activities of this Division is fee based. Some of the significant projects undertaken are
given hereunder:

A. Multilateral Funded Projects / Assignments: Asian Development Bank (ADB) funded
project for development and preparation of a comprehensive strategy for integrated urban
infrastructure development in 7 (seven) District Headquarter (DHQ) towns and 13- Urban
Local Bodies (ULBs) in Tripura.

B. Smart City Mission Programme : Project Development and Management Advisors for Smart
City projects Bareilly in Uttar Pradesh.

C. Atal Mission for Rejuvenation and Urban Transformation (AMRUT):

• Independent Review and Monitoring Agency (IRMA) for Rajasthan Cluster to
carryout periodic review and monitoring of the projects;

• Creation of Base Mapsfor25 towns and Formulation of GIS based Master Plan for 8
towns under 2 (two) clusters in West Bengal.

D. Jal Jeevan Mission (JJM)

Your company has also been part of the Centre's flagship mission programme to cover
maximum possible households under tap water supply which had very low penetration. As part
of this ambitious mission called "Jal Jeevan Mission", your Company has been
associated with the stakeholders through implementation of the following project titled:

• Appointment of Third Party Inspection Agency for Jal Jeevan Mission Project in
Kargil District.

E. Food Processing

For the Ministry of Food Processing Industries, Government of India, your Company has
been working as Programme Management Agency (PMA) for:

• Mega Food Park Scheme to facilitate establishment of Mega Food Parks;

• The Scheme for creation of infrastructure for Agro Processing Clusters under the
Central Sector Scheme - Kisan Sampada Yojana;

• The Scheme of Creation/ Expansion of Food Processing/ Preservative Capacities
(CEFPPC) under the Central Sector Scheme - Scheme for Agro-Marine Produce Processing and
Development of Agro Clusters (SAMPADA).

F. Tourism

Your Company has been working in the Tourism Sector for over a decade. Your Company has
been successfully providing Project Management Consultancy Services for 'Loktak Lake
Eco-Tourism Project' in Manipur. This project has now been rechristened as "Manipur
Mega Eco-Tourism Project" highlighting the State Government's focus on the same. This
project entails establishment of an effective PMC to work in close co-ordination with the
Client for preparation of Detailed Project Report (DPR), RFPs, conducting Bid Process
Management, Co-ordination with Ministry of Tourism / Other funding agencies for securing
funds/ grants and in intermittent design supervision.

G. Other Infrastructure Engagements

Your Company continues to work for the following projects in the Urban Infrastructure
domain:

• Project Management Consultant (PMC) for implementation of 5 (five) specific
Sewerage Schemes in Goa;

• Independent Engineer & Auditor for Food Corporation of India to
oversee/supervise setting up of Silos on Design, Build, Finance, Own & Operate (DBFOO)
basis for storage of food grains at Sangrur in Punjab and Kannauj in Uttar Pradesh.

H. International Engagements

During the year under review, your Company has also worked on few international
advisory assignments focused in Africa and Bangladesh.

• To enhance the capacities of the line ministries and other individuals or groups
related to the development endeavours and with the aim of institutionalizing the PPP
capacity building program in the Country, the PPP Authority, Govt. of Bangladesh engaged
your Company led Consortium for providing Comprehensive Training Services on PPP in
Bangladesh.

• Your Company has successfully completed preparation of a detailed engineering
design of Municipal Waste Collection Centres in Gambia for the Ministry of Fisheries and
Water Resources, Republic of Gambia. The project was funded by the African Development
Bank (AfDB).

2. Ushering in Operational Efficiency

Under the new leadership and management, this Division of your Company has been able to
consolidate its financial prudence resulting in the Division being self-sustainable vide
positive cash-flow. In fact, the net cash flow has shown a healthy increase of around 130%
over the last fiscal. In the year wherein your Company has been undergoing resolution
process, this sort of improvement in net cash-flow shows that the fundamentals of the
Division are restored and ready to take on new challenges.

A slew of consolidative and strategic measures have been introduced in this fiscal
which is thought to have a positive effect on the business in coming days and shall be
effective in generating more of stakeholders' value. Few such measures are:

• Thoughtful process adaptation for business procurement through partnership

• Focus on effective resource management through in-house based & managed
delivery mechanism

• Right sizing outsourcing in order to have a more balanced and effectively
managed project delivery mechanism

• More empowerment across the team structure & hierarchy has been introduced
to ensure more focus and self-sustainability.

3. Looking Forward

Over this fiscal, your Company has been able to imbibe effective and resolute knowledge
within the new gambit of GIS based Master Planning projects. One of the major advantage of
this has been that the Division has been able to align its newly built competency with
this upcoming sector of Government Advisory.

Apart from this, it is anticipated that in the coming fiscal, opportunities in the
realm of partnering Government Bodies to ensure capacity management to effectively run
& manage various schemes will be presented before your Company. Based on this, your
Company is strategically re-aligning its business modules internally and gearing up for
such opportunities.

Further also, it is being anticipated that the next wave of opportunity in Government
Advisory shall be across 2 (two) major areas (i) more technology and domain specific with
even more strategic support like operational management of smart and specific
infrastructures that are now being created; and (ii) on revamping more social attributes
connected with livelihood missions in Urban spheres owing to the post pandemic era.

Leveraging its core competency coupled with strategic planning for sectors like Urban
Infrastructure (specially focus on water supply, sanitation and solid waste management)
Tourism, Transportation, Industrial Park, GIS- based Master Plan, etc., your Company is
working on initiatives for sustainable growth.

INFRASTRUCTURE EQUIPMENT FINANCE - SREI EQUIPMENT FINANCE LIMITED

Srei Equipment Finance Limited (SEFL), awhollyowned subsidiary of your Company, is
registered with the Reserve Bank of India (RBI) as a systemically important non-deposit
taking NBFC and is one of thesignificantfinanciers in the Construction, Mining and allied
Equipment (CME) sector in India. In addition to CME, SEFL is also diversified into
financing of tippers, IT and allied equipment, medical and allied equipment, farm
equipment and other assets. The financial products and services comprise loans, for new
and used equipment, and leases.

The Union Budget 2023-24 has turned out to be a budget that strives to promote
infrastructure and development efforts while also focusing on essential elements such as
real estate, the industrial revolution, and greater public spending. For the first time,
infrastructure development has been allocated 10 trillion rupees. This is five times the
amount spentduring the previous decade. This year's budget places a heavy emphasison
investing more funds to promote connectivity between cities and build infrastructure
projects while maintaining a balance between fiscal consolidation and economic growth.

India is an ideal location for renewable energy investments. More than $78 Bn have been
invested in the Indian renewable energy sector since 2014. Abundant labour, easy access to
affordable capital, and single window clearances, make India an attractive destination to
set up renewable energy plants. As at March '23, renewable energy projects worth $197 Bn
of investments are underway in India.

Railways, a primary segment of India's overall infrastructure development, has been
allocated INR 2.4 Lac Crores, a decade high, in the recent budget for the development of
new semi high-speed Vande Bharat trains that are aimed at enhancing connectivity.

The Indian economy has already risen from tenth to fifth in the world in terms of size
and during times of adverse global economic setting. The per- capita income, in the last
decade alone, has doubled to ? 1.97 Lacs, a tremendous feat when compared to comparative
growth in other economies.

A 33 per cent rise in infrastructure investment capital spending, or ? 10 Lacs Crores
for 2023-24, or 3.3 per cent of GDP, is unprecedented in India's economic history and will
substantially improve the economy by opening up new avenues of employment for 600 million
population that are in employable age of 18 to 35.The budget allocation for building 50
additional airports, helipads and related infrastructure will help improve the logistical
reach while cutting down on the logistics cost simultaneously.

The construction Industry in India is expected to reach $1.4Tn by 2025.

a. Cities Driving Growth - Urban population to contribute 75% of GDP (63% present), and
68 cities will have a population of more than 1 Mn.

b. The construction industry market in India works across 250 sub-sectors with linkages
across sectors.

c. Residential - By 2030, more than 40% of the population is expected to live in urban
India (33% today), creating a demand for 25 Mn additional mid-end and affordable units.

d. Under National Infrastructure Pipeline (NIP), India has an investment budget of
$1.4Tn on infrastructure - 24% on renewable energy, 18% on roads & highways, 17% on
urban infrastructure, and 12% on railways.

e. Schemes such as the revolutionary Smart City Mission (target 100 cities) are
expected to improve quality of life through modernized /technology driven urban planning.

f. 54 global innovative construction technologies identified under a Technology
Sub-Mission of PMAY-U to start a new era in Indian construction technology sector.

g. 35 Multimodal Logistics Parks (MMLPs) to be developed at a total capital costof$6.1
Bn, will caterto50%of the freight movement.

100 % FDI through automatic route is allowed in construction - development projects
(which would include development of townships, construction of residential / commercial
premises, roads or bridges, hotels, resorts, hospitals, educational institutions,
recreational facilities, city and regional level infrastructure, townships) 100% FDI is
allowed under the automatic route for urban infrastructure areas like urban transport,
water supply, sewerage and sewage treatment.

It is common knowledge that there is a need to promote agriculture marketing
infrastructure projects for reducing the involvement of intermediates and minimizing
post-harvest losses. Such a robust infrastructure will ensure better remuneration to
farmers and supply of better quality products to consumers and processing industries.

In the Financial Year 2022-23 based on a low base numbers, the construction equipment
sector recorded a growth of around 15 per cent. If exports of equipment are taken into
account, the growth comes to around 20 per cent. In 2023-24,the Government is targeting
around 10 percent growth. One major concern is fluctuations in the growth factor which
depends on several domestic and overseas economic aspects. The growth of the construction
equipment manufacturing industry is linked to the demand drivers like road construction,
irrigation, housing, hotels, resorts, urban development, airports and mining. All these
are among the high priority areas of the Central Government. FDI allowed in the
construction development projects should add value to the construction equipment sector's
growth.

India is becoming an economic powerhouse on the international stage. In around a
decade, it is projected to become the third-largest economy in the world. In addition to
boosting the efficiency and productivity of the manufacturing sector, the development of
rural and urban infrastructure contributes significantly to the eradication of poverty.
Investing in the development of high-quality infrastructure is essential to achieving
these objectives. This year, the government has provided a tremendous incentive for the
development of both traditional physical infrastructure and modern digital infrastructure.

RESOURCES

During the year under review, your Company has not mobilised any additional resources
through non-convertible debentures ('NCDs'), External Commercial Borrowings, Masala Bonds,
Subordinate Debt, Perpetual Debt (PDI), Bank Borrowings etc.

As regards to NCDs issued earlier, PDI amounting to ? 320 Crores (Rupees Three Hundred
and Twenty Crores only) are unlisted and PDI amounting to ? 10Crores (Rupees Ten Crores
only) are listed on the Stock Exchanges. Your Company was admitted under the CIRP on
October 8,2021 and under the Code, the treatment of creditors under the resolution plan is
as per debts due as on insolvency commencement date and therefore no interest are accrued
and payable after this date.

Further, upon commencement of the CIRP of your Company, interim moratorium / moratorium
under Section 14 of the Code was imposed with effect from October 8,2021. As intimated
earlier Hon'ble NCLT has approved the resolution plan of the Company and implementation of
the Plan is under process. In accordance with law, all creditors shall be paid as per the
Approved Resolution Plan.

Brickwork Ratings India Pvt. Ltd. has reaffirmed the rating assigned to Perpetual Debt
Instrument (PDI) of your Company to '"BWR D Reaffirmed Issuer not cooperating#"
on June 13,2022.

RISK MANAGEMENT

The risk policies and procedures of your Company are derived from the guidance and
relevant directives provided from time to time by the Reserve Bank of India (RBI)
applicable for designated classifications of Non-Banking Finance Companies (NBFCs) that
your Company is included in and other regulatory authorities and continuously bench marked
with industries best practices.

Your Company's risk management strategies are well defined to identify, measure and
mitigate various risks associated with the operating business module, adherence assessment
procedures followed with continuous monitoring.

Risk management continues to be an important area of your Company's operations
especially in an environment which is characterized by increasing uncertainties like
pandemic, changes in operational procedures owing to market alignment, etc.

The risk strategy of your Company is overseen by the Risk Committee under the direct
supervision of the RBI appointed Administrator & Advisory Committee that strives to
put in place specific policies, frameworks and systems for effectively managing the
various risks. Policies approved from time to time by the Risk Committee in consultation
with other committees viz. Credit & Investment Committee (CIC) and the Asset Liability
Management Committee (ALMC), constitute the governing framework forvarious types of risk
and business activities undertaken within this policy framework.

Your Company is striving to manage its risks in a proactive manner and has adopted
structured and disciplined approach to risk management by developing and implementing risk
management framework. With a view to manage its risk effectively, your Company has put in
place policies for various aspects of Risk Management i.e. Credit Risk Management,
Independent Information Security Management System, Market Risk and Liquidity Risk
management policies.

In addition, to managing operational risk prudently, 'Know Your Customer (KYC) and'
Anti-Money Laundering (AML) Policy' are in place, which helps to preventy our Company from
being used intentionally or unintentionally by criminal elements for money laundering.

In order to stay ahead in the IT curve, an IT Disaster Recovery (DR) Plan has been
formalized which is expected to support the management of critical operations in future as
well. Your Company has successfully conducted an IT DR Drill. Your Company's servers are
entirely hosted on AWS (Amazon Web Services) Cloud Data Centers in Asia Pacific (Mumbai)
Region. As part of the implemented policies, automated AMI (Amazon Machine Image) backups
are performed daily, weekly and monthly for all application and database servers. All
these backups are stored on Amazon $3 (Simple Storage Service) which guarantees
99.999999999% durability and 99.99% availability by redundantly storing objects on
multiple devices across multiple Availability Zones in Mumbai region.

HUMAN RESOURCES ACTIVITIES

The pandemic induced disruptions continued in Financial Year 2022-23 as well. The first
half of Financial Year 2022 witnessed a significant impact of the third wave of the
Omicron strain which was more transmissible, impacting performance of certain services but
however, its impact on SIFL's operation was limited.

The organization structure which was put in place the previous year leading to a
leaner, flatter and more agile organization proved highly beneficial in the current
environment. Human Resources features to be one of the most critical functions of any
financial services organization. Your Company laid special emphasis on staff governance,
ethics / value sensitization workshops and compliance initiatives to create robust
governance.

Your Company principally drove home the concept of, "Keep People Inspired, Keep
People Involved" by way of staff engagement activities to increase employee morale,
maintaining the essence of engaging through varied philanthropic reaches and also to
motivate employees throughout the year.

This not only impacted the mental being but also provided a stress free environment and
enabled employees to interact, share and also kept them involved, especially at the
branches.

Respect for women at the workplace along with the spirit of diversity and inclusion
being an integral guiding HR principal -The International Women's Day celebrations flagged
off both at the HO and the branches marking the significance and acknowledging the
contribution by all women employees.

Your Company in collaboration with SREI Insurance Broking Private Limited ran a series
of health checkups and wellness workshops throughout the year for employees.

During this period, your Company re-assessed all its internal policies and practices
and brought in measures to make them more compliant as well as mitigate risks that it was
being exposed to.

RBI Administrator led management meetups kept the focus of "going concern" at
an all-time high.

Your Company's skilled workforce needed to work together effectively as well as show
quicker response time through taking increased responsibility for decision making as well
as displaying greater accountability. This was successfully demonstrated throughout the
review period by all teams.

A key point was the increased focus on building in-house capabilities through learning
process in order to develop employees to adapt to the new model and new focus that had
been introduced for developing new area of business and increasing effectiveness and
efficiency in on-going operations.

Learning and Development (L&D) initiatives adopted technology in order to increase
the scope speed and the extent of its reach so as to be able to help the organization
achieve the operational efficiency required.

Regulatory Training sessions commenced between the last two quarters of the year
through the platform of e-learning. The drive was to ensure all employees complete the
necessary regulatory training so as to achieve a compliance driven and policy adhering
environment. RBI mandated e-learning courses were 100% compliant.

The Human Resource (HR) Team has continued to lay stress on providing timely and
meaningful support to each employee - reaching out to them through the HR Business Partner
team, finding ways to create positivity and dialogue. Building resilience was a priority
and wellness was an area of focus throughout the year. Connecting people and ensuring
timely and effective communication was prioritized.

Your Company, focused on their human assets and kept instilling a feeling of pride and
belonging to the organization.

INFORMATION TECHNOLOGY

Information Technology plays a pivotal role in your Company's journey. Your Company
continues to leverage its technology to implement a resilient and secure infrastructure.

Your Company manages a variety of risks that can significantly affect its performance
and ability to meet the expectations of its customers, shareholders, regulators and other
stakeholders. Information Security risks include the risks arising from unauthorized
access, use, disclosure, disruption, modification or destruction of information or
information systems. In view of the same, your Company has conducted IT Risk Assessment to
assess its IT-related vulnerabilities and to ensure that proper controls are in place.
Your Company has also developed Key Risk Indicators (KRIs) pertaining to IT Security in
order to monitor changes in the levels of risk exposure and mitigate them in time.

During the year in review, your Company focussed on the formalization of an IT Disaster
Recovery (DR) Plan, as a part of its overall Business Continuity Plan (BCP).This IT DR
Plan is expected to support the management of critical operations in future as well. Your
Company successfully conducted IT DR Drill as per the BCP Policy.

The Company's Cyber Security Operations Centre (C-SOC) continues to monitor and improve
its security posture while preventing, detecting, analyzing and responding to cyber
security incidents. Your Company has not yet experienced any material losses relating to
cyber-attacks.

Your Company runs regular awareness campaigns to educate its employees regarding the
various aspects of Information Security, through various modes like periodic advisories
and online trainings.

INTERNAL CONTROL AND AUDIT

Your Company's vision, mission and core values have laid the foundation for internal
controls. On the administrative control side, your Company has a proper reporting
structure, oversight Committees and rigorous performance appraisal system to ensure checks
and balances. On the financial control side, your Company has in place segregation of
duties and reporting mechanism to deter and detect misstatements in financial reporting.

Your Company's internal control system is commensurate with the nature of its business
and the size and complexity of its operations and ensures compliance with policies and
procedures. The Internal Control Systems are being constantly updated with new as well as
revised Standard Operating Procedures.

Your Company has an Internal Audit Department, which provides comprehensive audit
coverage of functional areas and operations of your Company to examine the adequacy of and
compliance with policies, procedures, statutory and regulatory requirements.

Your Company has a dedicated and independent Internal Audit Department which is
accountable to the Internal Committees / Advisory Committee / Administrator during CIRP
period. The purpose, scope, authority and responsibility of the Internal Audit Department
are delineated in the Risk Based Internal Policy and the Audit Charter approved by the
Internal Committees / Advisory Committee / Administrator. Internal Audit Department
influences and facilitates improvements in the control environment by constantly
evaluating the internal control systems. Significant deviations are brought to the notice
of Internal Committees / Advisory Committee / Administrator. Status of compliances of
audit observations and follow up actions taken thereon are reported to the Internal
Committees / Advisory Committee / Administrator. The Internal Committees / Advisory
Committee / Administrator reviews and evaluates adequacy and effectiveness of your
Company's internal control environment and monitors the implementation of audit
recommendations.

Further, in accordance with the regulatory guidelines, your Company's Internal
Financial Controls (IFC) have been reviewed and actions have been taken to strengthen
financial reporting and overall risk management procedures. Further, an Information System
(IS) Audit of the internal systems and processes is conducted at least once in a year to
assess operational risks faced by your Company.

Based on the internal audit report, process owners undertake corrective action in their
respective areas. All these measures help in maintaining a healthy internal control
environment.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company has in place a Corporate Social Responsibility Policy (CSR Policy), as per
the provisions of the Companies Act, 2013 and Companies (Corporate Social Responsibility
Policy) Rules, 2014 which, inter-alia lays down the guidelines and mechanisms for
undertaking socially useful projects for welfare and sustainable development of the
Community at large. The said policy is available at the website of the Company at
https://www.srei.com/sifl_corporate
policies/Corporate_Social_Responsibility_CSR_Policy.pdf.

During the Financial Year 2020-21, your Company had sanctioned contribution of?
78,15,000/- (Rupees Seventy Eight Lacs and Fifteen Thousand only) for disbursement to
various entities. However, as on March 31,2021, your Company could disburse an amount of?
24,95,000/- (Rupees Twenty Four Lacs and Ninety Five Thousand only), being 0.66 per cent
of the average net profits of last 3 (three) immediate financial years preceding financial
year 2020-21, towards CSR activities pursuant to CSR Policy of your Company. The balance
sanctioned amount of ? 53,20,000/- (Rupees Fifty Three Lacs and Twenty Thousand only)
could not be disbursed till March 31,2021 due to the establishment of Trust and Retention
Account (TRA) whereby all the business payments of your Company were being controlled by
the Bankers and your Company has no control on the cash flows. Several requests were made
to the Bankers to disburse the aforesaid amount as committed to the concerned entities.
However, the Bankers have not disbursed the entire sanctioned amount. Thereafter, the
Corporate Insolvency Resolution Process (CIRP) of your Company commenced from October 8,
2021 pursuant to which your Company was further unable to disburse the balance sanctioned
amount of ? 53,20,000/- (Rupees Fifty Three Lacs and Twenty Thousand only). Furthermore,
due to the ongoing CIRP, your Company did not sanction any further contribution towards
CSR activities. Your Company is however committed to remain a socially responsible
organization supporting the national aspirations and missions.

Considering the special circumstances that the Company is in CIRP, your Company had
sought an exemption from the MCA through its various representations with respect to the
obligations under the provisions of Section 135 of the Companies Act, 2013.

Prior to the supersession, the Corporate Social Responsibility (CSR) Committee of your
Company had been constituted in line with the provisions of Section 135of the Companies
Act, 2013 ("the Act").

An Annual Report on CSR activities for the Financial Year 2022-23 is set out as an
annexure to the Board's Report and forms part of this Annual Report.

SREI WEBSITE

The website of your Companywww.srei.com has been developed on the new responsive
technology based platform known as 'Laravel', ensuring uniform display across all devices
like mobile, tablet, desktop etc. and all the operating systems. The website has an
inbuilt sophisticated and customized content management system for easy change in content.
A simple, improved navigation system needs a lesser number of clicks to reach the
information available in the different sections of the website. The contemporary and smart
look of the website ensures a customer centric approach catering to the requirements of
prospective customers, investors and employees. The website carries a comprehensive
database of information of interest to the investors including the financial results,
financial products, corporate codes and policies, corporate presentations, stock exchange
intimation and business activities of your Company and the services rendered by your
Company. The customers can also download essential documents directly from the website.

SUBSIDIARY COMPANIES

The Statement in Form AOC-1 containing the salient features of the financial statement
of your Company's subsidiaries pursuant to first proviso to Section 129(3) of the
Companies Act, 2013 (Act) read with Rule 5 of the Companies (Accounts) Rules, 2014, forms
part of the Annual Report. Further, in line with Section 129(3) of the Act read with the
aforesaid Rules, SEBI Listing Regulations, 2015 and in accordance with the Companies
(Indian Accounting Standards) Rules, 2015 (Ind AS Rules) read with Schedule III to the
Companies Act, 2013, Consolidated Financial Statements prepared by your Company includes
the financial information of its subsidiary companies.

A Report on the performance and financial position of each of the subsidiaries included
in the Consolidated Financial Statements prepared by your Company as per Rule 8(1) of the
Companies (Accounts) Rules, 2014, forms part of the annual accounts of each of the
subsidiary companies and also forms part of Form AOC-1.The said Report is not repeated
here for the sake of brevity. Members interested in obtaining a copy of the annual
accounts of the subsidiaries may write to the Company Secretary at the email id
investor.relations@srei.com.

In accordance with Section 136 of the Companies Act, 2013, the audited financial
statements, including the consolidated financial statements and related information of
your Company and audited accounts of each of its subsidiaries, are available on your
Company's website www.srei.com.

Highlights of the performance of subsidiaries and their contribution to the overall
performance of your Company during the period underreport are given below:


  

    
Name of the Subsidiary / Associate
    
Turnover/Total Income for the Financial Year ended 31.03.2023 (?in Lacs)
    
Profit After Tax (PAT)for the Financial Year ended31.03.2023 (?in Lacs)
    
% Contribution on Turnover/Total Income for the Financial Year
    ended31.03.2023
    
% Contribution on PAT for the Financial Year ended 31.03.2023
  
  

    
Srei Capital Markets Limited
    
28.93
    
(34.47)
    
0.02
    
0.00
  
  

    
Trinity Alternative Investment Managers Limited (TAIML)
    
*
    
*
    
N.A.
    
N.A.
  
  

    
Hyderabad Information Technology Venture Enterprises Limited (Subsidiary of TAIML)
    
*
    
*
    
N.A.
    
N.A.
  
  

    
Cyberabad Trustee Company Private Limited (Subsidiary of TAIML)
    
*
    
*
    
N.A.
    
N.A.
  
  

    
Srei Asset Leasing Limited
    
5.57
    
3.61
    
0.00
    
(0.00)
  
  

    
Bengal Srei Infrastructure Development Limited
    
2.91
    
1.42
    
0.00
    
(0.00)
  
  

    
Controlla Electrotech Private Limited
    
316.41
    
14.92
    
0.20
    
(0.00)
  
  

    
Srei Mutual Fund Trust Private Limited
    
-
    
(0.98)
    
-
    
0.00
  
  

    
Srei Mutual Fund Asset Management Private Limited
    
1.65
    
(1224.42)
    
0.00
    
0.11
  
  

    
Srei Insurance Broking Private Limited
    
184.98
    
140.65
    
0.54
    
(0.01)
  
  

    
Srei Equipment Finance Limited (SEFL)
    
1,55,757
    
(11,21,928)
    
99.66
    
100.99
  


*The Company has not received the Board approved Financial Statements from Trinity
Alternative Investment Managers Limited (TAIML) and its two step down subsidiaries viz.,
Hyderabad Information Technology Ventures Enterprises Limited and Cyberabad Trustee
Company Private Limited for the Financial Year ended March 31, 2023 and accordingly the
Financial Statement of these three Companies has not been considered for consolidation as
on March 31,2023.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION

There is no material change and commitment affecting the financial position of your
Company other than those mentioned in this Annual Report, which have occurred between the
Financial Year ended March 31,2023 and the date of this report.

POLICY FOR DETERMINING'MATERIAL'SUBSIDIARIES

As on March 31,2023, Srei Equipment Finance Limited (SEFL), a wholly owned subsidiary
of your Company is a listed' material' subsidiary of your Company with its, debt
securities being listed on the Stock Exchanges in India. However, your Company does not
have any material unlisted subsidiary. Your Company has formulated a Policy for
determining material subsidiaries in accordance with SEBI Listing Regulations, 2015.

The said Policy is available on your Company's website at
https://www.srei.com/sifl-corporate-policies/Policy_on_determining_Material_
Subsidiaries.pdf.

KEY MANAGERIAL PERSONNEL (KMPs)

The following executives of your Company are whole-time Key Managerial Personnel (KMPs)
in accordance with the provisions of Section 2(51) read with Section 203 of the Companies
Act, 2013 as on March 31,2023 :


  

    
Name
    
Designation
  
  

    
Mr. Manoj Kumar
    
Company Secretary & Chief Financial Officer
  
  

    
Mr. Vishnu Gopal Agarwal (Additional KMP)
    
Financial Controller and Chief Compliance Officer
  


Mr. Manoj Kumar was appointed as the Company Secretary w.e.f. April 1, 2021 and was
later appointed as the Chief Financial Officer (CFO) of the Company w.e.f. December
8,2021.

Further, Mr. Souren Mukhopadhyay, ceased to hold office as a Key Managerial Personnel
(KMP) w.e.f.July18,2022.

NOMINATION AND REMUNERATION COMMITTEE

Prior to the supersession of the Board of Directors, your Company had a duly
constituted Nomination and Remuneration Committee in line with the provisions of Section
178 of the Companies Act, 2013. The Committee had formulated the Nomination and
Remuneration Policy, which broadly lays down the various principles of remuneration being
support for strategic objectives, transparency, internal & external equity,
flexibility, performance- driven remuneration, affordability and sustainability, and
covers the procedure for selection, appointment and compensation structure of the Board
members, Key Managerial Personnel (KMPs) and Senior Management Personnel (SMPs) of your
Company. The link of the policy is
https://www.srei.com/sifl-corporate-policies/Nomination_ and_ Remuneration_Policy.pdf.

However, an internal committee of the Nomination and Remuneration Committee was formed
so that the matters relating to the Nomination and Remuneration Committee can be
deliberated and decided. The Committee was re-constituted and the following members were
inducted in the Committee : Mr. Rajneesh Sharma (Administrator), Mr. Souren Mukhopadhyay
(Deputy Chief Executive Officer), Mr. Jaidip Chatterjee (Head - Human Resources) and Mr.
Manoj Kumar (Company Secretary and CFO). Mr. Arunabha Acharya acts as the Secretary of the
Committee. The committee was further re-constituted on June 29,2022 due to the resignation
of Mr. Sourendranath Mukhopadhyay, as a member of the Committee. The Committee was further
re-constituted on October 15, 2022 due to the induction of Ms. Romita Singh as
(Non-Member) Secretary of the Committee and cessation of Mr. Arunabha Acharya as the
(Non-Member) Secretary of the Committee.

NOMINATION AND REMUNERATION POLICY & PERFORMANCE EVALUATION

Priorto supersession of the Board of Directors of your Company by the RBI on October
04,2021, your Company had a combination of Executive and Non-Executive Directors as well
as Independent Directors including a Woman Independent Director on its Board of Directors.

The Nomination and Remuneration Policy of your Company, has been formulated as per the
provisions of Section 178 of Companies Act, 2013 and Securities and Exchange Board of
India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The said policy is available on the website of your Company at
https://www.srei.com/sifl-corporate-policies/Nomination_and_ Remuneration_Policy.pdf.

Post supersession of the Board of Directors of your Company by the RBI on October
04,2021 as noted above, the requirement of separate meeting of the Independent Directors
and the evaluation of performance of Directors, Board or the Committees there of was not
applicable.

The said policy is available on the website of your Company at https://www.
srei.com/sifl-corporate-policies/Familiarisation_Programme_for_ Independent_Directors.pdf.

Since your Company is undergoing Corporate Insolvency Resolution Process under the IBC
Code, the role of the Board and Committees is being fulfilled by the Administrator
supported by the Advisory Committee.

WHISTLE BLOWER POLICY (VIGIL MECHANISM)

Your Company has formulated a codified Whistle Blower Policy incorporating the
provisions relating to Vigil Mechanism in terms of Section 177 of the Companies Act, 2013
and Regulation 22 of SEBI Listing Regulations, 2015, in order to encourage and support
Directors and Employees of your Company to report instances of illegal activities,
unethical behavior, actual or suspected, fraud or violation of your Company's Code of
Conduct and Code of Business Ethics and any issue of concerns impacting and compromising
with the interest of your Company and its stakeholders in any way. Your Company is
committed to adhere to highest possible standards of ethical, moral and legal business
conduct and to open communication and to provide necessary safeguards for protection of
employees from reprisals or victimisation, for whistle blowing in good faith. The said
Policy was last revised on 9th November, 2020 and is available on your Company's website
at https://www.srei.com/sifl-corporate-policies/Whistle_ Blower_Policy.pdf.

A Whistle blower committee is in place that reviews all matters and guides the
management to implement the relevant guidelines in true spirit and keep a vigil.

Further, no complaints were reported under the Vigil Mechanism during the year.

POLICY AGAINST SEXUAL AND WORKPLACE HARASSMENT

Your Company is committed to provide and promote a safe, healthy and congenial
atmosphere irrespective of gender, caste, creed or social class of the employees. Your
Company in its endeavour to provide a safe and healthy work environment for all its
employees has developed a policy to ensure zero tolerance towards verbal, physical,
psychological conduct of a sexual nature by any employee or stakeholder that directly or
indirectly harasses, disrupts or interferes with another employee's work performance or
creates an intimidating, offensive or hostile environment such that each employee can
realize his / her maximum potential.

Your Company has put in place a 'Policy on Prevention of Sexual Harassment' as per The
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Policy is meant to sensitize the employees about their fundamental right to have safe
and healthy environment at workplace. As per the Policy, any employee may report his / her
complaint to the Internal Complaints Committee constituted for this purpose. The said
Policy is available on your Company's website at
https://www.srei.com/sifl-corporate-policies/Policy_on_Prevention_
of_Sexual_Harassment.pdf.

Your Company affirms that during the year under review adequate access was provided to
any complainant who wished to register a complaint under the Policy and that your Company
has complied with the provisions relating to the constitution of Internal Complaints
Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013.

During the year, your Company has not received any complaint on sexual harassment from
any of the employees of your Company.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Your Company is exempted from the applicability of the provisions of Section 186 of the
Companies Act, 2013read with Rule 11 of the Companies (Meetings of Board and its Powers)
Rules, 2014 as your Company is engaged in the business of financing of companies or of
providing infrastructural facilities.

Details of the investments made by your Company are given in Note No. 47 in the Notes
to accounts forming part of the audited (standalone) financial statements for the
Financial Year ended March 31,2023.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the
Annual Return of your Company is available at https://www.srei. com/srei-annual-return.

PARTICULARS OF CONTRACTS / ARRANGEMENTS WITH RELATED PARTIES

All the related party transactions of your Company are entered in the ordinary course
of business and are on arm's length basis and are in compliance with the applicable
provisions of the Companies Act, 2013 and SEBI Listing Regulations, 2015.Thereareno
materially significant transactions entered into by your Company with Promoters, Directors
or Key Managerial Personnel (KMPs), which have potential conflict with the interest of
your Company at large. Your Company has not entered into any material related party
transactions with any of its related parties during the Financial Year 2022-23. Members
may refer to the notes to the financial statements for details of related party
transactions.

Since all related party transactions entered into by your Company were in the ordinary
course of business and were on an arm's length basis, Form AOC-2 is not applicable to your
Company. The related party transactions are entered into based on considerations of
various business exigencies, such as synergy in operations, sectoral specialisation and
your Company's long-term strategy for sectoral investments, optimisation of market share,
profitability, legal requirements, liquidity and capital resources of subsidiaries

In terms of Section 177 of the Companies Act, 2013 and prior to the supersession of the
Board of Directors and subsequent dissolution of all Board Committees, your Company
obtained approval of the Audit Committee for entering into any transaction with related
parties as applicable. A statement of all related party transactions was presented before
the Audit Committee on a quarterly basis, specifying the nature, value and terms and
conditions of the transactions. Further, post the supersession of the Board of Directors
by RBI vide its Press Release dated October 04,2021 and appointment of the Administrator
of your Company under Section 45-IE (2) of the RBI Act, your Company obtained approval of
the Administrator for entering into any transaction with related parties.

The details of the related party transactions entered into by your Company in the
ordinary course of business at arm's length basis for the financial year ended March
31,2023 are mentioned in the notes to the accounts forming part of the audited
(standalone) financial statements.

PARTICULARS OF EMPLOYEES

The statement containing particulars of employees as required under Section 197(12) of
the Companies Act, 2013 read with Rule 5(2) and Rule 5(3) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, as amended by the Companies
(Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 forms part of
this Report.

However, as per first proviso to Section 136(1) of the Act and second proviso of Rule
5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014,
the Report and Financial Statements are being sent to the Members of your Company
excluding the said statement. Any Member interested in obtaining a copy of the said
statement may write to the Company Secretary at the Registered Office of your Company.

PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS
AND OUTFLOW

Your Company has no activity relating to Conservation of Energy and Technology
Absorption as stipulated in Rule 8(3) of Companies (Accounts) Rules, 2014. However, your
Company uses information technology extensively in its operations and also continues its
endeavour to improve energy conservation and utilisation, safety and environment.

During the year under review, the total foreign exchange earnings and expenditure of
your Company was ? Nil and ? Nil, respectively (previous year Nil and ? 598.57 Lacs,
respectively).

CREDITRATINGS

Credit rating agencies have taken cognizance of various factors, mainly continuing
delays in debt servicing, significant losses incurred, cash flow mismatch and erosion of
net worth of the Company etc. and hence Brickwork Ratings India Pvt. Ltd. has reaffirmed
the rating assigned to Perpetual Debt Instrument (PDI) of your Company to "BWR D
Reaffirmed Issuer not cooperating#" on June 13,2022.

DETAILS OF TRANSFER OF UNCLAIMED AMOUNTS AND SHARES TO THE INVESTOR EDUCATION AND
PROTECTION FUND (IEPF)

As per section 124(5) of the Companies Act, 2013 a company is required to transfer the
amount lying in the unpaid dividend account, for 7 years, to the Investor Education
Protection Fund ("IEPF"). However, pursuant to the Order dated October 8,2021
passed by the Hon'ble NCLT, Kolkata, CIRP has been initiated for your Company and the
moratorium has commenced under Section 14 of the Code read with Rule 5(b)(i) of FSP Rules
effective from October 8, 2021. The Company needs to comply with the General Circular No.
08/ 2020 issued by the Ministry of Corporate Affairs (MCA) dated March 6,2020 captioned
"Filing of forms in the Registry (MCA-21) by the Insolvency Professional (Interim
Resolution Professional (IRP) or Resolution Professional (RP) or Liquidator) appointed
under Insolvency and Bankruptcy Code, 2016 (IBC, 2016)" which states that in respect
of companies which are marked under CIRP in the Registry, Annual Return (e-form MGT- 7)
and Financial Statement (e-form AOC- 4) and other documents under the provisions of the
Act, in accordance with directions issued by the NCLT/ NCLAT / Courts, shall be filed as
attachments with e-form GNL-2 against the payment of one time normal fee only, till such
time the Company remains under CIRP. Separate GNL-2 forms shall be filed for each such
document, by the IRP/ RP. The Company has made the filings of the eforms IEPF-1, IEPF-2
and IEPF-4, as an attachment of eform GNL-2. However, since the GNL-2 form is not linked
with IEPF -1, the Company is unable to generate SRN for payment to IEPF authorities. Due
to said technical difficulty the Company is unable to transfer the unpaid and unclaimed
dividend amount pertaining to the Financial Year 2014-15, under the provisions of Section
125 & other applicable provisions of the Act. The Company has approached the Registrar
of Companies and IEPF for their guidance. Response from the said authorities are awaited.

AUDITCOMMITTEE

Prior to the supersession of the Board of Directors of your Company by the RBI on
October 4,2021, the Audit Committee of your Company had been constituted in line with the
provisions of Section 177 of the Companies Act, 2013read with Regulation 18of SEBI Listing
Regulations, 2015.

Post the supersession of the Board all the mandatory committees' stands dissolved.

AUDITORS

At the 35th AGM held on September 19,2020, D. K. Chhajer & Co., Chartered
Accountants, having Firm Registration No. 304138E allotted by The Institute of Chartered
Accountants of India (ICAI), were appointed as Statutory Auditors of your Company to hold
office for a term of5 (Five) consecutive years from the conclusion of35th AGM till the
conclusion of the 40th AGM of your Company. The Statutory Auditors hold a valid peer
review certificate as prescribed under Regulation 33(1)(d) of SEBI Listing Regulations,
2015. However, as per the RBI Notification ref no. RBI/2021-22/25
DoS.CO.ARG/SEC.01/08.91.001/2021-22 dated April 27,2021 on Guidelines for Appointment of
Statutory Central Auditors (SCAs)/Statutory Auditors (SAs) of Commercial Banks (excluding
RRBs), UCBs and NBFCs (including HFCs) ("Notification") issued by the Reserve
Bank of India ("RBI") states that the Statutory Auditors of a NBFC need to be
appointed for a continuous period of three years subject to the firms satisfying the
eligibility norms each year. Hence, the current Statutory Auditors D. K. Chhajer &
Co., Chartered Accountants, having Firm Registration No. 304138E shall cease to hold
office with the conclusion of the ensuing AGM and S.K. Agarwal and Co., Chartered
Accountants LLP, having firm Registration No. 306033E/E300272 allotted by The Institute of
Chartered Accountants of India (ICAI) is being recommended for appointment as the
Statutory Auditors of your Company form the conclusion of 38th AGM till the conclusion of
39th AGM.

Members are requested to consider their appointment as Statutory Auditors of your
Company to hold office from the conclusion of38th AGM until the conclusion of39th AGM of
the Company by way of passing of an ordinary resolution.

S.K. Agarwal and Co., Chartered Accountants LLP have confirmed their eligibility,
qualifications and other requirements of the Auditors as specified in the Companies Act,
2013 and a certificate to this effect has also been furnished by them along with their
consent to hold office as the Statutory Auditors of your Company. Your Company has
received a confirmation from S.K. Agarwal and Co., Chartered Accountants LLP to the effect
that their appointment as the Statutory Auditors of your Company, if made, would be within
the limit prescribed under Section 141 of the Companies Act, 2013 and further that they
are not disqualified to be appointed as the Statutory Auditors in terms of Sections 139
and 141 of the Act. The proposed Statutory Auditors hold a valid peer review certificate
as prescribed under Regulation 33(1)(d) of SEBI Listing Regulations, 2015.

AUDITORS REPORT

The Administrator (assisted by the Advisory Committee), at the Advisory Committee
Meeting held on May 16,2023 have inter-alia, considered and taken on record the Ind AS
Audited Financial Results (Standalone & Consolidated) of your Company for Financial
Year ended March 31,2023, as per Regulation 33 and other applicable regulations of the
SEBI Listing Regulations and in compliance with Section 129 of the Companies Act, 2013 and
the Ind AS as per the provisions of the Companies (Indian Accounting Standards) Rules,
2015.

The Report of the Statutory Auditors to the Members for the Financial Year under review
contains Disclaimer of Opinion, the management's response to the Basis for Disclaimer of
Opinion contained in the Statutory Auditors' Report are given in the notes to accounts
which are self-explanatory, the same is not repeated here for the sake of brevity.

SECRETARIAL AUDIT REPORT

Your Company appointed Mr. Sachin Kumar, a Practicing Company Secretary having
Membership No. A37957, Certificate of Practice (COP) No. 14154, as the Secretarial Auditor
of your Company for Financial Year 2022-23 to conduct the Secretarial Audit pursuant to
Section 204 of the Companies Act, 2013 read with the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.

The Secretarial Audit Report confirms that your Company has as far as practically
possible during the CIRP period complied inter alia with all the applicable provisions of
the Companies Act, 2013 and the Rules made thereunder, the Securities Contracts
(Regulation) Act, 1956 and Rules made thereunder, the Depositories Act, 1996and the
Regulationsand Bye-laws framed thereunder, the Foreign Exchange Management Act, 1999 and
the rules and regulations made thereunder to the extent of Foreign Direct Investment,
Overseas Direct Investment and External Commercial Borrowings, SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015, Secretarial Standards issued by the
Institute of Company Secretaries of India (Secretarial Standards with respect to General
Meetings (SS-2) and , all the Regulations of the Securities and Exchange Board of India
(SEBI) as applicable to the Company, including the SEBI (Substantial Acquisition of Shares
and Takeovers) Regulations, 2011, the SEBI (Prohibition of Insider Trading) Regulations,
2015, the SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021, the
SEBI (Registrars to an Issue and Share Transfer Agents) Regulations, 1993, and the Reserve
Bank of India Directions, Guidelines and Circulars applicable to Systemically Important
Non-Deposit Accepting or Holding NBFCs (NBFC - ND - SI).

The Secretarial Audit Report in Form MR-3 is annexed to this report.

CORPORATE POLICIES

The details of Policies adopted by your Company along with salient features and summary
of key changes, during the year are provided as annexure to this Report and forms part of
this Annual Report.

CORPORATE GOVERNANCE

Pursuant to Regulation 34(3) read with Schedule V of SEBI Listing Regulations, 2015, a
separate section on Corporate Governance and a Certificate from a Practicing Company
Secretary confirming compliance with the requirements of Corporate Governance, forms part
of this Annual Report. The Corporate Governance Certificate (CGC) contains certain
observations, qualifications and remarks. The responses to all the aforesaid observations,
qualifications and remarks are given herein below:

The Company, to the extent applicable, has complied with the conditions of Corporate
Governance as stipulated in Regulations 17to 27,clauses (b) to (i) of sub-regulation (2)
of Regulation 46 and Para C, Dand E of Schedule V of SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 except given below:

a) As per Regulation 17(8) of SEBI LODR Regulations, 2015, the Chief Executive Officer
(CEO) and the Chief Financial Officer (CFO) shall provide the compliance certificate to
the Board of Directors as specified in Part B of Schedule II in LODR Regulations, 2015,
whereas the same has been provided by the RBI appointed Administrator.

b) As per Para D of Schedule V a declaration signed by the Chief Executive Officer
stating that the members of Board of Directors and Senior Management Personnel have
affirmed compliance with the code of conduct of Board of Directors and Senior Management,
whereas the same has been provided by the RBI appointed Administrator.

DIRECTORS

As mentioned earlier in this Report, Mr. Rajneesh Sharma was appointed as the
Administrator of your Company since October 4, 2021 and the management of your Company
vests in him. He is assisted by a three- member Advisory Committee to discharge his duties
and its current Members are Shri Venkat Nageswar Chalasani, Former Deputy Managing
Director, State Bank of India, Shri TT Srinivasaraghavan, Former Managing Director,
Sundaram Finance Limited and Shri VRamachandra, Former Chief General Manager, Canara Bank.

Accordingly, the disclosures pertaining to the Board of Directors, Board Meetings,
relationship between Directors inter-se, shares and Convertible Instruments held by
Non-Executive Directors, separate meeting of Independent Directors, familiarization
programme for Independent Directors, Board qualifications and attributes and other
disclosures pertaining to the Board of Directors were not applicable to your Company as on
March 31,2023.

MEETINGS OF THE BOARD & BOARD COMMITTEES

As stated earlier in this Report, RBI on October 4,2021 had superseded the Board of
Directors of your Company and initiated CIRP process vide order of the Hon'ble NCLT dated
October 8,2021. In view of the same, the Company also did not have any Board Meeting or
Board Committee during year under review.

ADVISORY COMMITTEE AND IMPLEMENTATION AND MONITORING COMMITTEE

RBI vide its Press Release dated October4,2021, in exercise of the powers conferred
under Section 45 IE of the RBI Act, constituted a three (3) member Advisory Committee to
assist the Administrator in discharge of his duties and to advise the Administrator in the
operations of your Company during the Corporate Insolvency Resolution Process (CIRP).

The Administrator is the Chairman of the meetings and the minimum quorum is Chairman
and at least two advisors. Further even after initiation of CIRP of your Company vide NCLT
order dated October 8, 2021, the Advisory Committee shall continue as the Advisory
Committee constituted under Rule 5 (c) of the Insolvency and Bankruptcy (Insolvency and
Liquidation Proceedings of Financial Service Providers and Application to Adjudicating
Authority) Rules, 2019. The Advisory Committee advises the Administrator on the operations
of your Company during the CIRP.

Further as stated earlier that in accordance to the framework of the Advisory Committee
as approved by RBI, primary responsibility of the Advisory Committee is to guide the
Administrator to undertake all steps that will maximize the value for all stakeholders of
your Company through a successful resolution. Since the Administrator also takes over the
responsibility of the Board of Directors of your Company, the Advisory Committee will
support the Administrator in fulfilment of his role and responsibilities.

Furthermore, Hon'ble NCLT vide its Order dated August 11,2023 approved the Resolution
Plan submitted by NARCL, accordingly, Implementation and Monitoring Committee was
constituted for smooth implementation of Approved Resolution Plan.

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

I. Subsequent to the supersession of the Board of Directors of your Company by RBI vide
its Press Release dated October 4,2021, RBI had filed an application for initiation of
corporate insolvency resolution process against your Company under Section 227 read with
clause (zk) of sub-section (2) of Section 239 of the Insolvency and Bankruptcy Code (IBC)
2016 read with Rules 5 and 6 of the Insolvency and Bankruptcy (Insolvency and Liquidation
Proceedings of Financial Service Providers and Application to Adjudication Authority)
Rules, 2019 before Kolkata Bench of the Hon'ble National Company Law Tribunal
("Hon'ble NCLT").

In the said petition being C.P. (IB) No. 295/KB/2021, the Hon'ble NCLT vide order dated
October 8,2021 was pleased to admit the said petition application and accordingly
Corporate Insolvency Resolution Process (CIRP) was initiated against your Company.

Accordingly, Mr. Rajneesh Sharma was appointed as the Administrator of SIFL in terms of
rule 5(a)(iii) of the Insolvency & Bankruptcy (Insolvency and Liquidation Proceedings
of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019 to
carry out the functions as contemplated by Sections 15,17,18,19 and 20 of the Insolvency
and Bankruptcy Code, 2016. The Order further provides that there shall be moratorium in
terms of Section 14of the said Code in respect of your Company.

The Administrator on 16th February, 2023, filed an application for obtaining
no-objection from the Reserve Bank of India (RBI) as required under Rule 5 of the
(Insolvency and Liquidation Proceedings of Financial Service Providers and Application to
Adjudication of Authority) Rules, 2019 against the Plan.

Thereafter, your Company received the said no-objection from the RBI via its letter
dated March 23,2023 in terms of Rule 5(d)(iii) of the FSP Rules.

The Administrator had also filed an application under Section 30(6) of the Code before
the Hon'ble National Company Law Tribunal (NCLT), Kolkata on February 18,2023 for its
approval of the Plan.

The Hon'ble NCLT has issued an order dated August 11,2023, approving the resolution
plan submitted by National Asset Reconstruction Company Limited with respect to the
corporate insolvency resolution process of the Companies under Section 31 of the IBC
("Approved Resolution Plan"). The same can be downloaded from the link:
https://nclt.gov.in/gen_pdf.php7filepatlWEfile_Document/
ncltdoc/casedoc/1908134009832023/04/0rder-Challenge/04_order
Challange_004_1691756009157129507964d625e9e66a0.pdf.

II. Your Company received a letter dated November 15,2021 from the Securities and
Exchange Board of India (SEBI) being a Show Cause Notice under Rule 4(1) of the SEBI
(Procedure for Holding Inquiry and Imposing Penalties) Rules, 1995 alleging that your
Company failed to disclose material information to the Exchange(s) as per the provisions
of Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 read with the provisions of SEBI Circular dated September 9, 2015, with
respect to an interim order passed by National Company Law Appellate Tribunal (NCLAT), in
response to the appeal filed by CARE Ratings Limited, arating agency before the Appellate
Authority against the order passed by NCLT, restraining the credit rating agencies from
treating the non-payment of interest / principal by your Company as a default. Your
Company appeared before the Adjudicating Officer (AO) of SEBI and the AO after taking into
consideration the facts and circumstances of the case, imposed a penalty of? 2,00,000/-
(Rupees Two Lacs) on your Company. However the order is subject to the outcome of the
appeal filed by SEBI before the Hon'ble Supreme Court in the matter of' Dewan Housing
Finance Corporation Ltd. v. Securities and Exchange Board of India'.

Vide Adjudication Order dated October 31,2022 ('Order'), SEBI in the matter of Religare
Enterprises Limited had imposed a penalty of ? 35,00,000/- on the Company payable within
45 days from the date of receipt of the Order.

However, vide its Corrigendum to Order dated November 30, 2022, SEBI has clarified that
the said period of 45 days shall not be applicable in respect of SIFL and SEFL due to the
CIRP proceedings pending against it. The said penalty is payable subject to the provisions
of IBC and outcome of the appeal filed by SEBI in the Dewan Housing Finance Limited case
matter in the Hon'ble Supreme Court (Appeal No. 206 of 2020).

III. The Enforcement Directorate (ED) on January 31, 2023 conducted simultaneous
investigation on office premises of the Company and its subsidiary, Srei Equipment Finance
Ltd. The Company and its officials have co-operated and provided the required informations
/documents as available.

IV. Receipt of Notice for Inspection U/S 206 of the Companies Act, 2013

The Company is in receipt of a Notice of MCA inspection u/s 206 of the Companies Act,
2013 and the Companies Act, 2013 vide letter Ref no File No. 1/60/2018/CL-II (ER) dated
April 18, 2023.

The Company has submitted its reply.

V. The Company has received a letter dated June 15,2023, from Serious Fraud
Investigation officer (SFIO) wrt., investigation into the affairs of Gujarat NRE Coke
Limited u/s 212 of the Companies Act, 2013 calling information u/s 217(2).

The Company has submitted its reply.

INSTANCES OF FRAUD DETECTED IN THE MATERIALLY WHOLLY OWNED SUBSIDIARY COMPANY

The Administrator had appointed BDO India LLP (BDO/Transaction Auditor) to review
transactions of the Company and its wholly owned subsidiary, qualified under Sections 43
to 51, and Sections 65 and 66 of the Code. Accordingly, the Administrator of the Company
received a report from the Transaction Auditor, indicating that there are certain
transactions which are allegedly fraudulent in natureas per Section 66 of the Code.

On the basis of the findings and observations of the Transaction Auditor necessary
reports and intimation with the Reserve Bank of India and the Stock Exchanges were filed.
Accordingly, applications have also been filed before the Hon'ble National Company
LawTribunal, Kolkata Bench in respect of the alleged fraud.

Re-statement of accounts of subsidiary

SIFL has not received Board approved financial results of01 subsidiary, viz. Trinity
Alternative Investment Managers Limited and 02 subsidiaries of Trinity (step down
subsidiaries of SIFL), viz. Hyderabad Information Technology Venture Enterprises Limited
and Cyberabad Trustee Company Private Limited for the quarters ended June 30,2022,
September 30,2022, December 31,2022, March 31,2023 and year ended March 31,2023 despite
written request and follow ups and accordingly, the financial statements of these
companies have not been considered for consolidation as on March 31,2023. Accordingly, the
consolidated financial statements for the year ended March 31,2023 are not comparable with
the consolidated financial statements for the year ended March 31,2022. We are unable to
comment on the possible impact of the same on the consolidated financial statements for
the year ended March 31,2023 or any other consequences arising out of such non-compliance
on the Consolidated Financial Statements.

The audited consolidated financial statements of the Group for the year ended March
31,2022 unaudited financial statements of 1 subsidiary, viz. Trinity and two subsidiaries
of Trinity (step down subsidiaries of SIFL), viz. Hyderabad Information Technology Venture
Enterprises Limited and Cyberabad Trustee Company Private Limited since the report and
audited accounts were not received within the annual account approval date of SIFL. The
management of these subsidiaries had not provided audited financial statements of these
aforesaid companies despite many reminders and accordingly, the financial statements of
these subsidiaries were considered for consolidation based on the approved and certified
financial statements provided by the management of the respective companies. Subsequently,
on receipt of the Audited Financial Statements dated May 20,2022 on June 4,2022, material
mismatch was observed between the Audited Financial Statements and the Financial
Statements that were considered for consolidation. At the time of preparation of financial
results for the quarter ended June 30, 2022, these discrepancies / mismatches were
rectified retrospectively in accordance with the guidelines of Ind AS 8, "Accounting
Policies, Changes in Accounting Estimates and Errors".

BOARD'S RESPONSIBILITY STATEMENT

The financial statements of your Company for the financial year ended March 31, 2023
have been taken on record by the Administrator while discharging the powers of the
erstwhile Board of Directors of your Company which were conferred upon him by the RBI vide
its press release dated October 4, 2021 and subsequently, powers conferred upon him in
accordance with the order of the Hon'ble NCLT dated October 8,2021 to run your Company as
a going concern during CIRP. The financial statements for the year ended March 31,2023
have been prepared on "going concern" assumptions.

The Administrator and present KMPs have signed the financial statements solely for the
purpose of compliance and discharging their duties during CIRP period of your Company and
in accordance with the provisions of the Code read with the regulations and rules
thereunder, and based on the explanations, clarifications, certifications, representations
and statement made by the existing staff of your Company in relation to the data
pertaining to the period prior to the joining of the present management and do not have
knowledge of the past affairs, finances and operations of your Company.

GENERAL DISCLOSURES

Your Administrator states that no disclosure or reporting is required in respect of the
following items as there were no transactions on these items during the year under review:

• Issue of equity shares with differential rights as to dividend, voting or
otherwise;

• Issue of sweat equity shares;

• Your Company does not have any scheme of provision of money for the purchase of
its own shares by employees or by trustees for the benefit of employees;

• There was no revision in the Financial Statements;

• There was no change in the nature of business;

• Maintenance of Cost records is not applicable to your Company. 

ACKNOWLEDGEMENT

Your Administrator would like to express his grateful appreciation for the excellent
support and co-operation received from the Financial Institutions, Banks, Central &
State Government Authorities, RBI, SEBI, MCA, Stock Exchanges, Depositories, Credit Rating
Agencies, Customers, Vendors, Suppliers, Business Associates, Members, Debenture holders,
Debenture Trustees and other Stakeholders during the year under review.

Your Administrator also place on record his deep appreciation for the valuable
contribution of the employees for the progress of your Company and look forward to their
continued co-operation in realisation of the corporate goals in the years ahead.

On behalf of Srei Infrastructure Finance Limited

Rajneesh Sharma (Administrator)

The affairs, business and property of Srei Infrastructure Finance Limited are being
managed by the Administrator, who acts as an agent of the Company only and without any
personal liability.

Place: Kolkata

Date: September 6,2023