DECLARATION BY INDEPENDENT DIRECTOR

In accordance with the provisions of the Section 149(6) of the
Act and Regulation 16(1)(b) & 25 of SEBI (LODR) Regulations,
2015, the Company has received declarations from all the
Independent Directors of the Company confirming that they
meet the criteria of independence for Independent Directors.

The Board affirms that the Independent Directors fulfill the
aforesaid criteria and possess requisite integrity, qualifications,
proficiency, experience, expertise and are independent of
the management.

The names of all the Independent Directors of the Company
have been included in the Independent Director’s databank
maintained by Indian Institute of Corporate Affairs (“IICA”). None
of the Directors have any pecuniary relationship or transactions
with the Company.

CERTIFICATE OF NON- DISQUALIFICATION OF
DIRECTORS

The Board of Directors hereby affirms that none of its members
are disqualified from being appointed as Directors in accordance
with the provisions of Section 164 of the Act. Further, no Director
has been debarred from holding the office of Directors by virtue
of any SEBI order or any other such authority. None of the
Directors of the Company are related to each other.

In support of the above, a certificate from a Company Secretary
in practice has been obtained confirming that none of the
Directors on the Board of the Company have been debarred or
disqualified from being appointed or continuing as Directors of
Company by SEBI / MCA or any such statutory authority. The
same forms part of this Annual Report as ‘Annexure-1’.

DISCLOSURE UNDER SECTION 197(14) OF THE
COMPANIES ACT, 2013

The Managing Director and CEO of the Company has not
received any commission from its Subsidiary Company.

BOARD MEETINGS

The Company ensures compliance with Corporate Governance
best practices by convening a minimum of 4 (Four) Board
meetings annually, with 1 (One) meeting held in each quarter.
The schedule for these meetings is determined well in advance,
following due consultation and concurrence of all Directors.

Decisions requiring immediate attention and matters of urgency,
approved via circular resolutions, are subsequently presented to
and duly noted at the next scheduled Board meeting to ensure
transparency and accountability in governance.

During the Financial Year under review, the Board convened
and conducted 7 (seven) meetings. The attendance details of

individual Directors at these meetings are comprehensively
documented in the Corporate Governance Report and therefore
are not reiterated here to prevent redundancy in reporting.

PERFORMANCE EVALUATION OF THE BOARD, ITS
COMMITTEES AND INDIVIDUAL DIRECTORS

The Board of Directors plays a crucial role in propelling success
of the Company and Board Evaluation is the essential process
that allows the Board to recognize and tackle challenges related
to Corporate Governance, thereby increasing the overall value
of the organization. A thorough and effective Board Evaluation
plays a crucial role in enhancing performance at both the
organizational board level and individual level.

In accordance with the criteria set forth in the Act and the SEBI
(LODR) Regulations 2015, the Board of Directors has conducted
an annual assessment of its performance, along with that of its
Committees and Individual Directors. The Board, in consultation
with its Nomination and Remuneration Committee, has
formulated a framework containing, inter-alia, the criteria for
performance evaluation of the entire Board of the Company, its
Committees and Individual Directors, including Independent
Directors, which is in compliance with the applicable provisions
of the Act and the SEBI (LODR) Regulations, 2015.

Further, the Board oversees, evaluates, and revises the
framework in collaboration with the Nomination and
Remuneration Committee, as necessary and in response to new
compliance obligations.

The Board Evaluation process is carried out through a web based
platform called ‘Goveva’, which streamlines the process, boosts
operational efficiency and automates report generation.

The comprehensive evaluation process for the Board, its
Committees, and individual Directors, including Independent
Directors, is outlined in the Corporate Governance Report,
which is the part of this Report.

SEPERATE INDEPENDENT DIRECTORS’ MEETINGS

During the Financial Year under review, a seperate meeting of
Independent Directors was convened on March 05, 2025 in
strict adherence to regulatory requirements. This meeting was
held without the participation of Non-Independent Directors
or members of the Company’s Management, thereby ensuring
an environment conducive to independent deliberation
and oversight.

The Independent Directors, in the course of this meeting,
reviewed and discussed various matters arising from
Committee meetings and Board deliberations. Their discussions
encompassed, inter alia, the assessment of the quality,
adequacy, and timelines of information flow between the
Company’s Management and the Board, ensuring that the Board
is equipped with all necessary data and insights to effectively
discharge its fiduciary and governance responsibilities.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT
DIRECTORS

In our dedication to uphold strong governance practices,
your Company has in place a system of conducting the
familiarization programmes for Independent Directors in view of
adherence with the expected obligations and responsibilities of
Independent Directors as prescribed under the Regulation 25(7)
of the SEBI (LODR) Regulations, 2015. As per the Programme,
Independent Directors are acquainted with their roles, rights,
responsibilities, and the nature and business model of the
Company upon their induction.

The Programme is designed to provide a conceptual framework
aligned with contemporary expectations, mandating that
Independent Directors comply with a code of ethics and integrity
to fulfil their responsibilities in a professional and trustworthy
manner, thereby fostering confidence within the investment
community. The objective of this program is to educate
Independent Directors about their rights and obligations, as
well as to familiarize them with the regulatory landscape and
the business model under which the Company operates.

The induction and continuous training programs empower the
Board, including Independent Directors to make well-informed
and deliberate decisions that align with the best interests of the
Company’s stakeholders.

The specifics of the Familiarization Programme have been
hosted on the Company’s website and can be accessed at
https://www.aavas.in/codes-and-policies.

POLICY ON DIRECTOR’S APPOINTMENT, REMUNERATION
& OTHER DETAILS

In pursuit of building a capable and visionary leadership team,
the Company has laid down a comprehensive Nomination and
Remuneration Policy for the selection, compensation and,
governance of its Directors, Key Managerial Personnel (“KMP”),
and Senior Managerial Personnel(“SMP”). This Policy emphasizes
ethical conduct, professional merit, and organizational fit,
ensuring that individuals appointed to critical roles bring
value through their competence and insight. The policy also
promotes transparency in the nomination process, reinforcing
the Company’s commitment to responsible leadership.

The Policy has been formulated in accordance with the Section
178 of the Act, provisions of Regulation 19 of SEBI (LODR)
Regulations, 2015 and Guidelines on Compensation of Key
Managerial Personnel and Senior Management in NBFCs issued
by RBI vide circular dated RBI/2022-23/36 DOR.GOV.REC.
No.29/18.10.002/2022-23 on April 29, 2022 (“RBI Guidelines”),
as amended from time to time.

The Policy is available on the website of the Company and can
be accessed at https://www.aavas.in/codes-and-policies and
all the details of remuneration paid to the Directors is mentioned
in Annual Return in form MGT-7, available on Company’s
website and can be accessed at https://www.aavas.in/investor-
relations/annual-reports.

The details with respect to the composition, terms of reference,
number of Meetings held, Committees as on March 31,2025 are
given in the Report on Corporate Governance, which forms part
of this Annual Report as ‘Annexure-2’.

EMPLOYEE STOCK OPTION PLAN

Employee Stock Option Plan serve as a strategic instrument
to attract, retain and reward talented employees. Beyond
fostering motivation and encouraging long-term commitment,
It align employees interest with the Company’s objectives,
thereby enhancing a sense of belonging and driving sustained
organizational success.

EQUITY STOCK OPTION PLAN (ESOP) 2016-I (e)

During the Financial Year under review, the Company made
grant aggregating to 89,500 options on October 15, 2024 under
ESOP-2016-I (e).

PERFORMANCE STOCK OPTION PLAN (“PSOP-2023”)

During the Financial Year under review, the Company made grant
aggregating to 1,22,139 options on October 15, 2024, 5,256
options on October 18, 2024 and 23,904 options on December
12, 2024 under the PSOP-2023.

PERFORMANCE STOCK OPTION PLAN (“PSOP-2024”)

The Company believes that equity-based compensation
schemes/plans are an effective tool to reward the talent
working with the Company for delivering long-term sustainable
performance and creation of stakeholder value. With a view
to drive long term performance, retain talent and attract new
talent, the Company formulated and implemented ‘Aavas
Financiers Limited - Performance Stock Option Plan- 2024’
(“PSOP-2024”) as a key component in its reward structure to
the eligible employees of the Company. The PSOP-2024 was
approved by the Shareholders in Annual General Meeting held
on August 07, 2024.

During the Financial Year under review, the Company made
grant aggregating to 4,00,000 options on January 30, 2025 under
the PSOP 2024.

Following are the existing ESOP and PSOP plans of the Company:

It is confirmed that all the ESOP & PSOP Schemes of the
Company are in compliance with the provisions of SEBI (Share
Based Employee Benefits and Sweat Equity) Regulations, 2021
(“SEBI SBEB and Sweat Equity Regulations”) as amended from
time to time.

The Nomination & Remuneration Committee administers and
monitors the ESOP & PSOP Schemes in compliance with the
Act, SEBI SBEB and Sweat Equity Regulations, 2021 and SEBI
(LODR) Regulations, 2015.

The Secretarial Auditors of the Company has given a Certificate,
confirming that the above ESOP & PSOP Schemes have been
implemented in accordance with the SEBI SBEB and Sweat
Equity Regulations, 2021 as amended from time to time. Such
ESOP & PSOP Schemes will be available for the inspection of
the Members of the Company.

The applicable disclosures as stipulated under Regulation 14 of
SEBI SBEB and Sweat Equity Regulations, 2021, with regard to
ESOP & PSOP Plan of the Company are available on the website
of the Company at https://www.aavas.in/investor-relations/
annual-reports.

AUDIT & AUDITORS

Statutory Auditors and Auditors’ Report

In terms of provisions of Section 139 of the Act, read with
the Companies (Audit and Auditors) Rules, 2014 and
RBI Guidelines for appointment of Statutory Auditor(s),
M/s. M S K A & Associates Chartered Accountants (Firm
Registration No. 105047W) and M/s. Borkar & Muzumdar,
Chartered Accountants (Firm Registration No. 101569W) were
appointed as the Joint Statutory Auditors of the Company by the
members of the Company for a period of 3 (Three) consecutive

years in the 14^th AGM held on August 07, 2024 effective from the
conclusion of 14^th AGM until the conclusion of 17^th AGM.

The Audit Report given by the Joint Statutory Auditors on the
financial statements of the Company is part of this Annual
Report. There has been no qualification, reservation, adverse
remark or disclaimer given by the Auditors in their Report.

The Audit Committee and the Board of Directors also took note
of the eligibility certificate received from both the audit firms
that they are not disqualified and are eligible to hold the office as
Auditors of the Company. Further, during the year under review,
the Auditors have not reported any fraud under Section 143(12)
of the Companies Act, 2013.

Secretarial Auditors and Secretarial Audit Report

M/s. Chandrasekaran Associates, Company Secretaries (Firm
Registration No. P1988DE002500), have carried out Secretarial
Audit of the Company for the Financial Year 2024-25 in
accordance with the provisions of Section 204 of the Act read
with the rules made thereunder.

In accordance with provisions of Sub-section (1) of Section 204
of the Act, the Secretarial Audit Report in form MR-3, is furnished
as 'Annexure-3', which forms part of this Annual Report.

The Report of Secretarial Auditors is self-explanatory and there
has been no observations or qualifications or adverse remarks
in their Report.

Furthermore, M/s. Chandrasekaran Associates, Company
Secretaries has issued an Annual Secretarial Compliance
Report for the Financial Year 2024-2025 in compliance with
Regulation 24A of SEBI (LODR) Regulation, 2015 which forms
part of this report as ‘Annexure-4’ and is also submitted to the
Stock Exchanges. There are no observations, or qualifications
or adverse remarks in their Report.

Pursuant to the amendments made in SEBI Regulations
i.e., SEBI (Listing Obligations & Disclosure Requirements)
(Third Amendment) Regulations, 2024 and pursuant to SEBI
Circular No. SEBI/HO/CFD/CFD-PoD-2/CIR/P/2024/185 dated
December 31, 2024, the Company shall appoint Secretarial
Auditor for a term of 5 years (the earlier term served shall not
be considered for this term) with recommendation of Board and
Shareholders approval in its Annual General Meeting.

Consequently, in accordance with, Section 204 of the Act,
the Board of Directors, has recommended the appointment
of M/s. Chandrasekaran Associates, (Firm Registration No.
P1988DE002500) Company Secretaries as Secretarial Auditors
of the Company for a period of 5 (Five) consecutive Years
effective from FY 2025-26 upto FY 2029-30, to the Shareholders
of the Company for their approval.

The Company has obtained consent and eligibility certificate
from the above audit firm under applicable rules and laws that
they are not disqualified and are eligible to hold the office as
Secretarial Auditors of the Company, if appointed.

INFORMATION SYSTEM AUDIT (“IS AUDIT”)

The landscape around information systems has been
changing, therefore an IS audit focuses on the governance and
management aspects of technology and cybersecurity as much
as it does on specific focus areas of the audit.

The Company has in place an IS Audit Policy which is cognizant
of business imperatives and is aligned with the aspirations of the
organization, including being agile and innovative and adopting
technologies at a rapid pace. Our Head of Internal Audit (“HIA”)
is accountable to the Audit Committee and Management in
providing assurance on the adequacy and effectiveness of
the Company’s risk management, control, and governance of
information system processes used for controlling its activities
and managing its significant risks and also report material frauds
and their investigations and corrective actions.

INTERNAL AUDIT & INTERNAL FINANCIAL CONTROL
AND ITS ADEQUACY

The Company has in place Risk Based Internal Audit Framework
("RBIA") in compliance with directive issued by Reserve Bank
of India. The Company has developed an in-house audit team
and appointed HIA to oversee the audit of functional areas
and operations.

The Internal Audit department is headed by the HIA who reports
directly to the Audit Committee of the Board. The primary
responsibility of the HIA is to effectively manage the Internal
Audit department and to ensure that it adds value to the entity
and its strategic objectives by strengthening risk controls,
enhancing operational efficiencies, and ensuring governance
compliance. The RBIA framework effectively ensures that
internal audit coverage is commensurate with the nature of
complexity of business operations on an ongoing basis. It
encompasses coverage of business and support functions,
technology and regulatory aspects as well as branch audits.
HIA ensures compliance with the internal audit principles
and standards and the independence of the Internal Audit
department, its audit staff and evaluating its performance
against key performance indicators.

The Audit Committee performs periodic reviews and evaluates
adequacy and effectiveness of the Company’s internal
control environment, ensuring the timely implementation of
audit recommendations to enhance operational integrity and
regulatory compliance.

The Company’s internal financial control is a process designed
to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements
in accordance with generally accepted accounting principles.
The Company’s internal financial control framework includes
those policies and procedures aimed at:

• Ensuring the maintenance of accurate financial records;

• Providing reasonable assurance that financial transactions
are recorded appropriately for the preparation of
financial statements;

• Establishing mechanisms for the timely prevention and
detection of unauthorized acquisition, use or disposal
of Company assets that may have a material impact on
financial statements.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY
REGULATORS

There were no significant or material orders passed by the
regulators or courts or tribunals against the Company during
the Financial Year 2024-2025.

MATERIAL CHANGES/EVENTS AND COMMITMENTS, IF
ANY

During the year following material changes/events have
occurred:

Material Event: Share Purchase Agreement and Open
Offer

During the year under review, your Company entered into
separate share sale agreements (collectively, “SPAs”) with
Aquilo House Pte. Ltd. (“Purchaser”) and each of Lake District
Holdings Limited, Partners Group ESCL Limited and Partners
Group Private Equity (Master Fund), LLC, who were members of
the promoter/ promoter group of the Company till June 30, 2025
(collectively, “Sellers”). Pursuant to the SPAs, the Purchaser
agreed to acquire in aggregate 2,09,49,112 equity shares of
the Company from the Sellers constituting 26.47% of the paid-
up share capital of the Company and control of the Company
subject to the terms and conditions set out in the SPAs.

The Purchaser is a Company incorporated under the laws of
Singapore and belonging to the CVC Network. The CVC Network
is a global alternative investment manager focused on private
equity, credit, secondaries and infrastructure, consisting of CVC
Capital Partners PLC (a public limited Company whose shares
are listed and admitted to trading on the Euronext Amsterdam
Stock Exchange) and each of its subsidiaries, from time to
time. The execution of the SPAs triggered an obligation of the
Purchaser to make an open offer to the public shareholders of
the Company in accordance with the Securities and Exchange
Board of India (Substantial Acquisition of Shares and Takeovers)
Regulations, 2011. The Purchaser acquired 1,78,08,116 equity
shares of the Company aggregating to 22.50% of paid-up share

capital of the Company pursuant to the open offer from the
public shareholders.

In accordance with the terms of the SPAs, on June 30, 2025 (the
“Closing Date”), Purchaser has acquired 2,09,49,112 equity
shares constituting 26.47% of the paid-up share capital of
the Company and on and from the Closing Date (i) Purchaser
has acquired control of the Company and is categorized as a
‘promoter’ of the Company; and (ii) the erstwhile promoters
and members of the promoter group of the Company hold NIL
shares of the Company and have ceased to be in control of the
Company, and stand reclassified as public shareholders of the
Company with effect from June 30, 2025.

Currently, Purchaser holds 3,87,57,228 equity shares of the
company, representing 48.96 % of the paid-up share capital of
the Company.

Further, there are no material changes and commitments
affecting the financial positions of the Company, which have
occurred after March 31,2025, till the date of this report.

MAINTENANCE OF COST RECORDS

The Company being an NBFC-HFC is not required to maintain
cost records as per sub-section (1) of Section 148 of the
Companies Act 2013.

INFORMATION TECHNOLOGY

Your Company has always been at the forefront of technology
innovations and effectively leveraging technology to enhance
efficiency of the teams, managing risks, optimizing cost and
provide superior experience to our customers.

The Company is working towards building a robust and scalable
technology architecture in line with the charted transformation
roadmap to make the Company future ready. Your Company has
made a significant progress on this roadmap by successfully
completing transformation of all key business applications.

The Company has already adopted a modern and innovative
cloud-native application stack for loan origination and customer
service using Salesforce and Mulesoft platforms which provide
360-degree visibility for the entire customer life cycle.

The Company has adopted ORACLE Fusion ERP System for
accounting and financial reporting.

During Financial Year, the Company has successfully completed
the migration of Loan Management System to ORACLE Flexcube
Core Banking Application and also automated the Treasury
Operations using Beacon Treasury Management System.

By utilising multiple India stack based fintech integrations and
advance analytics capabilities, we have significantly optimised
our processes to bring in efficiency and agility at all levels. The
Company has created a technology stack to integrate with
digital platforms and our digital partnerships with Central Govt’s

Common Service Centres (CSC), Rajasthan Govt’s eMitra Kiosks
and India Post Payment Bank are testament to the Company’s
commitment to become a partner in the last mile financial
inclusion mission. The Company is actively looking forward to
build and scale such partnerships in future.

The Company has upgraded the information security systems
with modern and robust security solutions in all major domains
including - data centre, endpoints, applications, network,
etc. The Company performs continuous training / awareness
programs for our teams and customers on emerging cyber
threats and defence strategies. The Company performs periodic
assessments of security, process controls and business
continuity readiness through various layers of internal teams,
service providers and auditors.

HUMAN RESOURCE - A CULTURE OF COMMITMENT,
CONSISTENCY AND COMPASSION

Your Company has always been committed to nurturing a
supportive, inclusive and dynamic workplace where each
team member feels valued and motivated. Our comprehensive
HR initiatives are designed to enhance employee well-being,
cultivate professional growth, and build a strong sense of
community. By investing in our people, we not only drive
individual success and well-being, but also propel our
organisation towards greater achievements. Its vision of being
a leader and a role model in a broad based and integrated
financial services business and a culture that is purpose driven
gives meaning to our people. As we reflect on the past Financial
Year, 2025, it is evident that our success is intrinsically linked to
the quality and competence of our human capital.

Your Company has continued to built upon the strong
foundation established in previous years by implementing
strategic initiatives designed to enhance the well-being, foster
career growth and advance professional development of our
employees. Among these initiatives, we have placed a particular
emphasis on promoting the holistic well-being of our female
staff and strengthening the leadership capabilities of our senior
management team.

Recognizing the importance of a performance-driven culture,
the Company introduced a performance-based equity scheme
to instill a sense of ownership and accountability while
incentivizing excellence. This initiative reflects our dedication
to align individual contributions with organizational success,
ensuring that employees are rewarded for their commitment
and achievements.

Furthermore, we continue to invest in leadership development
programs, mentorship opportunities, and skill enhancement
initiatives to empower our workforce and equip them with the
tools necessary to excel in an evolving business landscape.

As of March 31,2025, our permanent employees count stood
at 7,233, reflecting our growth and unwavering commitment to
fostering a conducive and performance-driven organizational
environment. In the future, your Company is committed to foster
an improved workplace that nurtures professional development
and operational excellence. Together, we will persist in our
pursuit of excellence, promote sustainable growth and create
lasting value for all our stakeholders.

RISK MANAGEMENT FRAMEWORK

Effective risk management is a crucial aspect of the Company’s
operations due to the inherent nature of its business.
Acknowledging this, a series of internal policies have been
established to strengthen the resilience of business operations.

Your Company priorities risk management by establishing
a specialized sub-committee of executives, along with the
Risk Management Committee of the Board, to supervise the
process. This not only adheres to Regulation 21 of the SEBI
(LODR) Regulations, 2015, but also guarantees conformity
with RBI guidelines. The establishment of such a committee
fosters a strong risk culture and governance framework within
the organization, thereby enhancing its overall sustainability
and success.

The Risk Management Committee convenes at least biannually,
and additionally as required by the Board or Chairperson,
to maintain continuous oversight of the Company’s risk
environment. By implementing suitable methodologies,
processes and systems, the Committee is instrumental in
monitoring and assessing the risks related to the business.
Furthermore, the supervision of the Risk Management
Policy’s execution and the evaluation of the adequacy of risk
management systems demonstrate a proactive stance towards
risk management within the Company.

The Company has established comprehensive Risk
Management Policies, which include Risk Management
Policy, an IT Risk Management Policy, and an Internal Capital
Adequacy Assessment Processes (“ICAAP”) policy, along with
an Early Warning Signal (“EWS”) framework that adheres to
RBI guidelines.

Identifying and monitoring significant risks such as Credit Risk,
ALM Risk, Concentration Risk, Interest Rate Risk, Reputation
Risk, Cybersecurity Risk, Fraud Risk, Business Risk, Exposure
Risk, Competition Risk and Regulatory Risk are essential for
preserving the Company’s stability and resilience. These risks
are reported to the Risk Management Committee quarterly,
ensuring transparency and proactive risk management.

Additionally, the application of institutional intelligence
in underwriting methodology, carried out by a skilled and
experienced team, including Chartered Accountants, signifies
a strong approach to risk assessment within the Company.

Moreover, the presence of dedicated vendors and professionally
qualified in-house teams to manage legal, technical and
operational risks further strengthens the Company’s risk
management capabilities.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

In any organization, a secure and confidential channel for
reporting concerns related to ethical conduct is essential for
maintaining accountability and integrity. Such a mechanism
empowers individuals to raise issues without fear, fostering
a culture of transparency and trust within the organization.
Accordingly, your Company has in place a Whistle Blower Policy
encompassing vigil mechanism pursuant to the requirements of
Section 177(9) and (10) of the Act and Regulation 22 of the SEBI
(LODR) Regulations, 2015, to report to the management genuine
concerns or grievances about unethical behavior, actual or
suspected fraud or violation of the Company’s Code of Conduct.

With the core aim to achieve the highest standards of ethical,
moral and legal conduct of business operations and to nurture
these standards, the Company encourages its employees who
have concerns about suspected misconduct to come forward
and express their concerns without fear of punishment or
unfair treatment.

The mechanism provides a secure channel to the employees
and Directors for adequate safeguards against victimization
of employees and Directors who use such mechanism and
makes provision for direct access to the Chairperson of the
Audit Committee in exceptional cases, ensuring transparency
and accountability in addressing whistleblower concerns. There
are no restrictions for accessing the Audit Committee for any of
the Company’s employees.

In order to safeguard the fairness of the process, the identity
of the Whistle Blower is kept confidential to prevent any
discriminatory actions against him/her.

The whistle blower policy is placed on the website of the
Company and can be accessed at https://www.aavas.in/codes-
and-policies.

DISCLOSURES UNDER SEXUAL HARASSMENT OF
WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
& REDRESSAL) ACT, 2013

Your Company is committed to foster a safe, respectful and
inclusive workplace where every individual is empowered
to work without fear, bias or harassment including sexual
harassment. Primarily, we ensure a safe and equitable working
environment for women and aim to ensure that every employee
is treated with dignity and respect as sexual harassment at
workplace is an extension of violence in everyday life and it
is both discriminatory and exploitative, adversely impacting a
women’s right to life and livelihood.

Pursuant to the provisions of the Sexual Harassment of Women
at Workplace (Prevention, Prohibition and Redressal) Act, 2013
(“the POSH Act”) and the rules made thereunder, the Company
has formulated and implemented a Policy for prevention of
sexual harassment against women and redressal of complaints
thereto and has also constituted Internal Complaints Committee
(“ICC”) under the POSH Act.

ICC has been set up to redress complaints received regarding
sexual harassment. All employees are covered under this policy.
The details of complaints received and disposed during the
Financial Year are provided in Corporate Governance Report
forming part of this Annual report.

MATERNITY BENEFITS PROVIDED BY THE COMPANY
UNDER MATERNITY BENEFIT ACT, 1961

The Company places strong emphasis on creating a supportive,
inclusive and equitable workplace for its women employees. As
part of this commitment, the Company have been in compliance
with the all applicable provisions of Maternity Benefit Act, 1961,
during the financial year under review.

Accordingly, the Company has in place a well-defined Leave
Policy, which explicitly outlines the provisions related to
maternity leave and associated benefits. All eligible women
have been extended the statutory benefits prescribed under
the Act, including paid maternity leaves, continuity of salary
and service during the leave period, and post maternity support.

Recognizing the importance of employee welfare, the Company
remains dedicated to ensuring a safe and empowering work
environment for its women employees in accordance with the
applicable laws.

CODE OF CONDUCT FOR PREVENTION OF INSIDER
TRADING IN COMPANY’S SECURITIES

The Company has, formulated and adopted code of conduct for
prevention of Insider Trading in compliance with the Securities
and Exchange Board of India (Prohibition of Insider Trading)
Regulations, 2015 (“the PIT Regulations”).

The Code of Conduct for Prevention of Insider Trading was
formulated to regulate, monitor and ensure reporting of trading
by Designated Persons and their immediate relatives designated
on the basis of their functional role in the Company towards
achieving compliance with the Regulations and is designed to
maintain the highest ethical standards of trading in Securities of
the Company by persons to whom it is applicable. The provisions
of the Code are designed to prohibit identified Designated
Persons from trading in the Company’s Securities while in
possession of Unpublished Price Sensitive Information (“UPSI”).
The Code lays down guidelines for procedures to be followed
and disclosures to be made while dealing with Securities of

the Company and cautions them against the consequences
of violations.

In order to protect the interest of the stakeholders at large,
Mr. Saurabh Sharma, Company Secretary and Compliance
Officer of the Company, is authorized to act as Compliance
Officer under the Code, with the responsibility to oversee
adherence to Insider Trading Regulations and related
governance principles.

Furthermore, in accordance with regulations 3 (5) and (6) of SEBI
(PIT) Regulation 2015, the Company has maintained a Structural
Digital Database (“SDD”), wherein details of persons with
whom UPSI is shared on need-to-know basis and for legitimate
business purposes is maintained with time stamping and audit
trails to ensure non-tampering of the database. It ensures proper
record-keeping and monitoring of access to UPSI. This database
serves as an essential tool for regulatory compliance, preventing
unauthorized dissemination and ensuring transparency in the
management of sensitive financial information.

The SDD is maintained internally by the Company and is
not outsourced in accordance with the provisions of the
PIT Regulations.

PARTICULARS OF HOLDING/JOINT VENTURE/
SUBSIDIARY/ASSOCIATE COMPANIES

Pursuant to the share sale agreements with Aquilo House Pte.
Ltd. (“Purchaser”) and each of, Lake District Holdings Limited,
Partners Group ESCL Limited and Partners Group Private Equity
(Master Fund), LLC, who were members of the promoter/
promoter group of the Company till June 30, 2025 and pursuant
to power conferred to purchaser in terms of Article 16 of the
Article of Association of the Company, the Aquilo House Pte. Ltd
has become the Holding Company in terms of Section 2(87)(i)
of the Companies Act,2013 i.e. by controlling the composition
of the Board of Directors w.e.f. June 30, 2025.

Further, your Company does not have any Joint Ventures or
Associate Company as on the date of this report.

Subsidiary Company: Completion of Voluntary
Liquidation

Your Company had an unlisted wholly owned subsidiary named
‘Aavas Finserv Limited’ which has been voluntarily dissolved
following the order passed by the Hon’ble National Company
Law Tribunal ("NCLT") on January 28, 2025.

Therefore, your Company is no longer required to prepare
Consolidated Financial Statements and Statement containing
salient features of Financial Statement of the Subsidiary
pursuant to the Provisions of Section 129(3) of the Act.

Further, pursuant to Section 129(3) of the Act read with the
Companies (Accounts) Rules, 2014, a statement containing

salient features of Financial Statement of the Subsidiary or
Associate Companies or Joint Ventures in the prescribed format
AOC-1, is furnished as 'Annexure-6', which forms part of this
Annual Report.

In accordance with Section 136 (1) of the Act, the Annual Report
of your Company containing inter alia, Financial Statements has
been placed on our website at https://www.aavas.in/investor-
relations/annual-reports.

INVESTOR RELATIONS

Fostering trust through open and timely communication is
fundamental in building strong and enduring relationships with
the investment community. The Company remains committed
to keep stakeholders well informed about its financial health,
strategic initiatives and long-term objectives through consistent
and transparent engagement. It is using technology wisely to
sustain performance today and also leverages it for future
growth. Your Company is always looking ahead and takes on a
holistic perspective of the operating landscape.

To strengthen engagement and trust, the Company has
established a specialized investor relation team, which helps
the Company to communicate with its investors through
Information session on Financial Results for institutional
investors and analysts via telephone conference, meetings with
investors/analysts and discussions between Fund Managers
and Management.

Investor relation team participate in investor relations
conferences each quarter to foster better relationships with
investors. Presentations given by Company to fund managers,
analysts, and investors are posted on the Company website
and are also transmitted to stock exchanges. Each quarter, the
audio recordings of these meetings, along with their transcripts,
are posted on the website at https://www.aavas.in/investor-
relations/investor-intimation.

PARTICULAR OF EMPLOYEE REMUNERATION AND
RELATED DISCLOSURES

In compliance with Section 197(12) of the Act and Rule
5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, disclosures regarding the
remuneration of Directors and employees have been made.
Additionally, as stipulated by Rule 5(2) of the aforementioned
rules, the names and other details of the top ten employees in
terms of remuneration have been included as ‘Annexure-8’ to
this Report.

CORPORATE SOCIAL RESPONSIBILITY ("CSR")

Your Company, being a responsible corporate citizen, is
dedicated to enhancing societal welfare by incorporating social

and environmental considerations into its business practices,
engaging in philanthropic efforts, and delivering positive social
value and wealth to its stakeholders. In line with the Company’s
Corporate Social Responsibility ("CSR") initiatives, it has
launched various projects focused on Education and Holistic
Development, Environmental Sustainability, Healthcare and
Wellness, Community and Rural Development, Women’s
Empowerment, and Strategies for Reducing Inequalities, all
aimed at improving the quality of life in diverse communities,
particularly among marginalized groups.

The CSR policy of the Company relates to the activities to be
undertaken by the Company, which is in accordance with the
provisions of CSR under Section 135 of the Act read with the
Companies (Corporate Social Responsibility Policy) Rules, 2014
and Schedule VII of the Act.

The CSR Policy is hosted on Company’s website and can be
accessed at: https://www.aavas.in/codes-and-policies and the
Annual Report on CSR activities is furnished as ‘Annexure-9’
which forms part of this Annual Report.

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

In terms of Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, the particulars of energy
conservation, technology absorption and foreign exchange earnings and outgo is provided as under:

ENVIRONMENT HEALTH AND SAFETY (“EHS”)
PROTECTION

The Company is committed to maintain high environmental and
social standards across its operations. It continues to enhance
its investment decision-making processes and procedures to
align with applicable Indian environmental and social legislation,
as well as relevant international standards, including the IFC
Performance Standards, particularly in relation to its housing
finance and MSME Business segments.

The Company ensures a healthy and safe working environment
for all its employees, adhering to best practices in workplace
safety and employee well-being. In line with its commitment
to continuous improvement, the Company regularly evaluates
and upgrades its EHS practices to proactively address emerging
risks, ensure compliance, and foster a culture of safety and
sustainability across all levels.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORTING

In accordance with Regulation 34(2)(f) of the SEBI (LODR)
Regulations, 2015, the top 1,000 listed companies based
on market capitalization are required to include a Business
Responsibility and Sustainability Report (BRSR) in their Annual
Reports. This report outlines the Company’s initiatives from an
Environmental, Social and Governance (“ESG”) perspective.

Following SEBI Circular SEBI/HO/CFD/PoD2/CIR/P/0155 dated
November 11,2024, the top 250 listed entities are required to
disclose ESG information under the BRSR Core framework as
part of their Annual Reports.

As one of the top 500 listed entities, and in alignment with its
commitment to strong corporate governance, the Company has
voluntarily adopted and submitted the BRSR Core Framework

for the Financial Year 2024-25, in addition to publishing the
standard Annual BRSR as per regulatory guidelines. This
framework helps reinforce ESG principles throughout the
Company’s operations, guiding efforts towards responsible
product development, operational efficiency, employee
empowerment, and environmental stewardship in line with the
expectations outlined in the BRSR.

The Company remains focused on strengthening its ESG
performance year over year, continually enhancing its
disclosures, systems, and practices to create meaningful
impact and align with evolving stakeholder expectations.

The Business Responsibility and Sustainability Report in
updated format describing the initiatives taken by the Company
from an environmental, social and governance perspective
along with Limited Assurance Statement from an Independent
Auditor forms part of this Annual Report as ‘Annexure-11’.

ANNUAL RETURN

The Annual Return has been prepared in form MGT-7 as on March
31,2025 in compliance with the provisions of Section 134(3) and
Section 92(3) of the Act, read with Rule 12(1) of the Companies
(Management and Administration) Rules, 2014. The same is
placed on the website of the Company and can be accessed at
https://www.aavas.in/investor-relations/annual-reports.

ADDITIONAL DISCLOSURES UNDER COMPANIES
(ACCOUNTS) RULES, 2014

(a) The details of application made or any proceeding pending
under the Insolvency and Bankruptcy Code, 2016 (31 of
2016) during the year along with their status as at the end
of the Financial Year:

The Company has not filled any application under the
Insolvency and Bankruptcy Code, 2016 (31 of 2016)
during the Financial Year under review. Hence there are no
proceedings pending with respect to the above. Therefore,
it is not applicable to the Company.

(b) The details of difference between amount of the valuation
done at the time of one-time settlement and the valuation
done while taking loan from the Banks or Financial
Institutions along with the reasons thereto:

During the Financial Year under review, the Company has
not made any settlement with its Bankers or Financial
Institutions from which it has availed any term loan.

PARTICULARS OF LOANS, GUARANTEES OR
INVESTMENTS

Since the Company is an HFC, it is exempted from disclosing
information regarding particulars of loans extended, guarantees
given, and security provided in the ordinary course of business
under the provisions of Section 186(11) of the Act.

Nevertheless, the notes to the Financial Statements of the
Company state the details of loans, guarantees, and investments

CONTRACTS OR ARRANGEMENTS WITH RELATED
ARTIES

four Company has an explicit “Policy on Materiality of
delated Party Transactions and dealing with Related Party
rransactions” to ensure that all related party transactions are
an an arm’s length basis and in the ordinary course of business
n adherence of the provisions of Section 188 of the Act and
ules made thereunder and the SEBI (LODR) Regulations,
>015. Accordingly, all related party transactions entered during
financial Year 2024-25 were on an arm’s length basis and in the
ordinary course of business under the Act and were not material
jnder the SEBI (LODR) Regulations, 2015.

\ll related party transactions entered into during the Financial
/ear, were presented to both the Audit Committee and the
Board. The Audit Committee has granted omnibus approval for
elated party transactions as per the provisions of the Act and
he SEBI (LODR) Regulations, 2015. Further, in compliance with
he Section 134(3)(h) of the Act, a thorough disclosure has been
nade in Form AOC-2 as ‘Annexure-7’ which forms part of this
nnual Report.

\dditionally, in compliance with the SEBI and RBI Master
Directions, the 'Policy on Materiality of Related Party
rransactions and dealing with Related Party Transactions' is
riven in ‘Annexure-10’ which forms part of this Annual Report
and is available for viewing on the Company’s website at https://
www.aavas.in/codes-and-policies.

NTERNAL GUIDELINES ON CORPORATE GOVERNANCE

Corporate Governance forms the cornerstone of responsible and
athical business conduct, ensuring transparency, accountability
and long term value creation for all the stakeholders of the
Company. Your Company has been committed to uphold
he greatest standards of corporate governance by adhering
o its fundamental values, which include putting the needs
af the customer first, being transparent, acting fairly, being
accountable, and acting with integrity and equity in all of
ts dealings.

he Company’s Corporate Governance framework ensures that
t makes timely and appropriate disclosures and shares factual
and accurate information to its stakeholders so as to make an
nformed decision.

rhe Company has approved and adopted the Internal Guidelines
an Corporate Governance. The Internal Guidelines on Corporate
Covernance has been framed in accordance with the Act, SEBI
LODR) Regulations, 2015, RBI Master Directions, 2021 and
ther applicable rules and regulations.

rhe Internal Guidelines on Corporate Governance of the
Company is available on the website of the Company and can
ae accessed at https://www.aavas.in/codes-and-policies.

DIRECTORS’ RESPONSIBILITY STATEMENT

In compliance with the provisions of Section 134(3)(c) and
134(5), of the Act and based on the information provided by
the Management, the Board of Directors hereby gives the
following statement:

(a) in the preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures;

(b) the Directors had selected such accounting policies and
applied them consistently and made judgments and
estimates that are reasonable and prudent to give a true
and fair view of the state of affairs of the Company at the
end of the Financial Year and of the profit and loss of the
Company for that period;

(c) the Directors had taken proper and sufficient care for
the maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding
the assets of the Company and for preventing and detecting
frauds and other irregularities;

(d) the Directors had prepared the annual accounts on a going
concern basis;

(e) the Directors had laid down Internal Financial Controls
to be followed by the Company and that such Internal
Financial Controls are adequate and were operating
effectively; and

(f) t he Directors had devised proper systems to ensure
compliance with the provisions of all applicable laws and
that such systems were adequate and operating effectively.

BUSINESS OVERVIEW & FUTURE OUTLOOK

A comprehensive evaluation of the business and its future
prospects is included in the Management Discussion and
Analysis section of the Annual Report.

ACKNOWLEDGEMENTS AND APPRECIATION

Behind every milestone achieved lies the collective effort of
many, as we reflect on the past years, the Board of Directors is

proud to recognize collective efforts of all stakeholders of the
Company, that have enabled the Company to move forward with
purpose and resilience.

We extend our heartfelt appreciation for all the support and
trust received from the Stakeholders of the Company, including
the Reserve Bank of India, National Housing Bank, Ministry of
Corporate Affairs, Securities and Exchange Board of India,
Insurance Regulatory and Development Authority of India, Stock
Exchanges i.e. BSE and NSE, and other regulatory authorities.

The Board also acknowledges the support and cooperation
from Bankers, Lenders, Financial Institutions, Members, Credit
Rating Agencies, National Securities Depository Limited, Central
Depository Services (India) Limited, National Stock Exchange
International Financial Service Centre Limited, and Customers
of the Company for their continued trust and support.

The Directors wish to express their deep appreciation to
Kedaara Capital and Partners Group for their invaluable
support which proved instrumental in driving the Company’s
growth and success. Further, the Board is also thankful to
the resigning directors for their enduring commitment and
meaningful Contributions.

We also take this opportunity to warmly welcome our new
Promoter, Aquilo House Pte. Ltd., belonging to CVC network,
whose induction marks a significant milestone in the Company's
growth journey. We look forward to a strong and fruitful
partnership, leveraging their expertise and vision to drive
sustained progress and long-term value creation.

Additionally, the Board records its sincere appreciation for the
commitment demonstrated by all executives, officers, staff, and
the Senior Management team of the Company, for contributing
to the excellent performance of the Company during the
Financial Year.

The Board wishes to express its gratitude to all the Shareholders
for their invaluable support.