The Board of Directors of Aditya Birla Capital Limited ("your Company" or "the Company" or "ABCL") is pleased to present the 17^th (Seventeenth) Annual Report and the Audited Financial Statements (Consolidated and Standalone) of the Company for the financial year ended 31^st March 2024 ("financial year under review").

FINANCIAL SUMMARY AND HIGHLIGHTS

The highlights of the Consolidated and Standalone Financial Statements are detailed hereunder.

The Company's financial performance for the financial year ended 31^st March 2024 as compared to the previous financial year ended 31^st March 2023 is summarised below:

(' Crore)

The above figures are extracted from the Consolidated and Standalone Financial Statements prepared in accordance with Indian Accounting Standards ("IND AS") as notified under Sections 129 and 133 of the Companies Act, 2013 ("the Act") read with the Companies (Accounts) Rules, 2014 and other relevant provisions of the Act and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations").

RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS

Standalone Performance

For the financial year ended 31^st March 2024, on a Standalone basis revenue of the Company was ? 859.57 Crore and Net Worth was ? 13,938.58 Crore. The profit after tax of the Company was ? 714.28 Crore.

Consolidated Performance

• Consolidated Segment Revenue^{1, 2}: ? 39,050 Crore (grew 30% year on year)

• Consolidated Net Profit^{2, 3}: 2,902 Crore (grew 41% year on year)

• Overall, AUM across Asset Management, Life Insurance and Health Insurance at over ? 4.36 Lakh Crore (grew 21% year on year)

• Overall lending book [Non-Banking Financial Company ("NBFC") and Housing Finance] at ? 1.24 Lakh Crore (grew 31% year on year)

• Gross premium (across Life and Health Insurance) at ? 20,961 Crore (grew 18% year on year)

The financial results of the Company and its Subsidiaries,

Joint Ventures and Associate(s) are elaborated upon in the

Management Discussion and Analysis Report, which forms part

of this Annual Report.

ACCOUNTING METHOD

The Consolidated and Standalone Financial Statements of the Company have been prepared in accordance with Indian Accounting Standards as notified under Sections 129 and 133 of the Act read with the Companies (Accounts) Rules, 2014, as amended and other relevant provisions of the Act.

In accordance with the provisions of the Act, applicable Accounting Standards, the SEBI Listing Regulations, the Audited Standalone and Consolidated Financial Statements of the Company for the financial year ended 31^st March 2024, together with the Auditors' Report form part of this Annual Report.

The Audited Financial Statements (including the Consolidated Financial Statements) of the Company as stated above and the Financial Statements of each of the Subsidiaries of the Company, whose financials are consolidated with that of the Company, are available on the Company's website at https:// www.adityabirlacapital.com/Investor-RRlations.

MATERIAL EVENTS DURING THE YEAR

a) The Company had issued Equity Share Capital through Preferential Issuance of 7,57,11,688 equity shares of face value ? 10/- each at a price of ?165.10 per equity share (including share premium of ?155.10 per equity share), to its Promoter and a member of Promoter Group on 26^th June 2023 and through, Qualified Institutional Placement (QIP) of 10,00,00,000 equity shares of face value ? 10/- each at a price of ?175.00 per equity share (including share premium of ?165.00 per equity share), to Qualified Institutional Buyers on 30^th June 2023, both aggregating to ? 3,000 Crore.

b) The Board of Directors of the Company, at its Meeting held on 11^th March 2024, approved the Scheme of Amalgamation of Aditya Birla Finance Limited ("Amalgamating Company") (a wholly owned subsidiary of the Company) with the Company and their respective Shareholders and Creditors under Sections 230 to 232 of the Companies Act, 2013 and other applicable provisions of the Companies Act, 2013 read with rules made thereunder ("Scheme"). The Scheme inter-alia provides for the amalgamation of the Amalgamating Company with the Company, and dissolution of the Amalgamating Company without winding up. The Scheme is subject to the sanction of National Company Law Tribunal ("NCLT"), Ahmedabad Bench and receipt of necessary approvals from the Reserve Bank of India, Stock Exchanges and Securities and Exchange Board of India, shareholders / creditors, as may be directed by the NCLT and such other regulatory / statutory authorities, as may be required.

HOLDING/ SUBSIDIARIES/ JOINT VENTURES/ ASSOCIATES COMPANIES

Holding Company

During the financial year under review, Grasim Industries Limited continued to remain the Holding Company of the Company. Grasim Industries Limited is listed at BSE Limited ("BSE") and National Stock Exchange of India Limited ("NSE"). As per Regulation 16(1)(c) of SEBI Listing Regulations, the Company is considered as a Material Subsidiary of Grasim Industries Limited.

Subsidiaries and Associates

As a Core Investment Company, the Company is primarily a Holding Company and holds investments in its group companies (Subsidiaries, Joint Ventures and Associates).

As on 31^st March 2024, the Company had 17 (Seventeen) Subsidiaries and 2 (Two) Associate companies.

Provisions of Regulations 24 and 24A of SEBI Listing Regulations, with reference to Subsidiaries were duly complied to the extent applicable.

During the financial year under review, the major changes with respect to the Subsidiaries and Associate(s) of the Company were as under:

a) Scheme of Amalgamation between Aditya Birla Money Insurance Advisory Services Limited ("ABMIASL"), Aditya Birla Money Mart Limited ("ABMML") and Aditya Birla Capital Technology Services Limited ("ABCTSL") with Aditya Birla Financial Shared Services Limited ("ABFSSL"), all wholly owned subsidiaries of the Company was filed with Hon'ble National Company Law Tribunal ("NCLT"), Ahmedabad Bench on 13^th December 2023 and the approval from Hon'ble NCLT is awaited.

b) Aditya Birla Sun Life AMC Limited ("ABSLAMC") has become an Associate Company of the Company w.e.f. 24^th August 2023 due to dilution of the Company's shareholding to less than 50% in ABSLAMC.

c) Following the dilution of the Company's shareholding in ABSLAMC to less than 50%, ABSLAMC is no longer qualified as a subsidiary of the Company. Consequently, the five foreign subsidiaries of ABSLAMC has also ceased to be subsidiaries of the Company, as ABSLAMC itself transition into an Associate Company.

d) Further, the Company sold 1,39,94,199 equity shares of Aditya Birla Sun Life AMC Limited ("ABSLAMC") representing

4.86% of the issued and paid-up Equity Share Capital of the ABSLAMC, by way of an offer for sale through Stock Exchange mechanism, in order to achieve minimum public shareholding of the ABSLAMC, as required under the applicable laws. The offer for sale was completed on 20^th March 2024. Post completion of offer for sale, the shareholding of the Company in ABSLAMC was reduced to 45.14%.

MATERIAL SUBSIDIARIES

As required under Regulations 16(1)(c) of the SEBI Listing Regulations, the Board has approved and adopted the Policy for determining Material Subsidiaries. The Policy is available on the Company's website at https://www.adityabirlacapital.com/ investor-relations/policies-and-code.

Aditya Birla Sun Life Insurance Company Limited, Aditya Birla Housing Finance Limited and Aditya Birla Finance Limited are Material Subsidiaries (Debt Listed) of the Company as per Regulation 16(1)(c) of the SEBI Listing Regulations.

With effect from 24^th August 2023, Aditya Birla Sun Life AMC Limited has ceased to be a Material Subsidiary of the Company as per Regulation 16(1)(c) of the SEBI Listing Regulations.

REGISTRATION AS A CORE INVESTMENT COMPANY ("CIC")⁴

The Company is registered as a Non-Deposit taking Systemically Important - Core Investment Company ("CIC- ND-SI") pursuant to the receipt of Certificate of Registration from the Reserve

Bank of India ("RBI") bearing registration no. B.01.00555, dated 6^th July 2017 under Section 45-IA of the Reserve Bank of India Act, 1934 ("RBI Act") and Master Direction - Core Investment Companies (Reserve Bank) Directions 2016 as amended ("RBI Master Directions"). The Company is classified as Middle Layer NBFC in terms of Scale Based Regulation ("SBR"), a Revised Regulatory Framework for NBFCs' issued by RBI vide its Circular No. RBI/2021-22/112 Ref. DOR.CRE. REC.No.60/03.10.001/2021-22 dated 22^nd October 2021 ("SBR Framework"), which came into effect from 1^st October 2022.

RBI REGULATIONS

The Company has complied with all the regulations of RBI to the extent applicable as a CIC-ND-SI and as Middle Layer NBFC under the SBR Framework.

TRANSFER TO RESERVES

For the financial year ended 31^st March 2024 an amount of ? 142.86 Crore was transferred to Special Reserve in terms of Section 45-IC of the RBI Act.

DIVIDEND

The Directors do not recommend any dividend for the financial year under review. In terms of the provisions of Regulation 43A of the SEBI Listing Regulations, the Company has formulated and adopted a Dividend Distribution Policy. The policy is available on the Company's website at https://www.adityabirlacapital. com/investor-relations/policies-and-code.

Mr. Amber Gupta, Company Secretary and Compliance Officer of the Company has been appointed as the Nodal Officer and Mr. Pramod Bohra, Vice President, has been appointed as the Deputy Nodal Officer for and on behalf of the Company for the purpose of verification of claims and co-ordination with Investor Education and Protection Fund Authority.

Their details are available on the website of the Company at https://www.adityahirlacapital.com/investor-rRlations/ shareholder-centre.

DEPOSITORY

As on 31^st March 2024, out of the Company's paid-up Equity Share Capital comprising of 2,60,00,21,884 Equity Shares, 2,57,40,44,070 Equity Shares (99.00%) were held in dematerialised mode.

The Company's Equity Shares are compulsorily tradable in electronic form.

RESOURCE MOBILISATION

During the financial year under review, no funds have been mobilised by way of Non-Convertible Debentures ("NCD") or Term Loans / Working Capital Demand Loan ("WCDL") from banks or through Commercial Paper. The Company is a debt free Company.

INVESTMENT IN SUBSIDIARIES AND ASSOCIATE(S)

During the year under review, the Company subscribed to Equity Share Capital of the following Subsidiaries:

Further, details of investment in Subsidiaries and Associates are stated in the notes to the Financial Statements forming part of this Annual Report.

CREDIT RATING

The Company has neither issued any debt instruments nor undertaken any fixed deposit programme or any scheme or proposal involving mobilisation of funds in India or abroad during the financial year under review.

However, the Company continues to avail the below ratings from Credit Rating agencies to meet any unforeseen fund requirements through any of the following instruments:

PUBLIC DEPOSITS

The Company, being a CIC-ND-SI, has not accepted any deposits from the public during the financial year under review in accordance with Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF LOANS GIVEN, INVESTMENT MADE, GUARANTEES GIVEN OR SECURITY PROVIDED

The Company is registered as a Core Investment Company with RBI. Thus, particulars of loans, guarantees and investments under the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014, are not applicable to the Company.

CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION

As the Company is a Core Investment Company investing in Subsidiaries and Associate(s), the particulars regarding conservation of energy and technology absorption as required to be disclosed pursuant to provision of Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are not relevant to its activities.

However, some of the steps taken by the Company along with its Subsidiaries/ Associate(s) for conservation of energy include:

• The Company and its Subsidiaries/ Associate(s) are committed to reducing negative environmental impact.

• The Company along with Subsidiaries/ Associate(s) tied up with ViaGreen, an organisation that helps us in waste management and recycling.

• Most of the offices of the Company and its Subsidiaries/ Associate(s) have installed LED lights making them very energy-efficient. Rooftop solar panel has been installed at Pune, Bengaluru and Noida branch offices.

• As a step towards further reducing the environmental impact, the documents for Board and Committee meetings of the Company and its Subsidiaries/ Associate(s) are transmitted electronically using a secure web-based application, thereby saving paper.

• The energy saving measures taken also include selecting and designing offices to facilitate maximum natural light utilisation, video-conferencing facilities across all offices to reduce the need of employee travel, digital learning initiatives for employees, optimised usage of lights and continuous monitoring and control of the operations of the air conditioning equipment as well as elimination of nonrecyclable plastic in offices.

FOREIGN EXCHANGE EARNINGS AND OUTGO

There were no foreign exchange earnings during the financial year under review as well as during the previous financial year. The foreign exchange outgo during the financial year under review was ? 3.34 Crore as compared to ? 0.52 Crore, during the previous financial year.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details, as required under Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are attached as Annexure I to this report.

Details as required under Section 197(12) of the Act, read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, with respect to information of employees of the Company will be provided upon request by a Member. In terms of the provisions of Section 136(1) of the Act, the Annual Report is being sent to all the Members of the Company whose email address(es) are registered with the Company/ Depository Participants via electronic mode, excluding the aforesaid Annexure which shall be made available for inspection by the Members via electronic mode. If any Member is interested in obtaining a copy thereof, the Member may write to the Company Secretary at the Registered Office of the Company in this regard or send an email to ahc.secrRtarial@adityahirlacapital.com.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The Company forms part of the top 1000 listed entities on BSE and NSE as on 31^st March 2024. Accordingly, pursuant to Regulation 34(2) of SEBI Listing Regulations, Business

Responsibility and Sustainability Report ("BRSR") of the Company for FY 2023-24 forms part of this Annual Report.

The Company has also voluntarily undergone an independent assurance of the BRSR for FY 2023-24. The BRSR along with the assurance statement provided by DNV Business Assurance India Private Limited (Assurance Provider) confirming reasonable assurance of Core attributes of the Business Responsibility and Sustainability Report of the Company for FY 2023-24 is also available on the Company's website at https://www. adityabirlacapital.com/%20investor-relations/financial-reports.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE COMPANY

There were no material changes and commitments affecting the financial position of the Company from the end of the financial year up to the date of this Report.

CHANGE IN NATURE OF BUSINESS

During the financial year under review, there has been no change in the nature of business of the Company.

EMPLOYEE STOCK OPTION PLAN

Aditya Birla Capital Limited Employee Stock Option and Performance Stock Unit Scheme 2022

The Company has adopted "Aditya Birla Capital Limited Employee Stock Option and Performance Stock Unit Scheme 2022" ("Scheme 2022") for the benefit of the employees of the Company and its Subsidiaries, Associates and Group companies.

Aditya Birla Capital Limited Employee Stock Option and Performance Stock Unit Scheme 20l7 and ABCL Incentive Scheme for Stock Options and Restricted Stock Units - 2017.

The Company also adopted "Aditya Birla Capital Limited Employee Stock Option and Performance Stock Unit Scheme 2017" ("Scheme 2017") for the benefit of the employees of the Company and its Subsidiaries and "ABCL Incentive Scheme for Stock Options and Restricted Stock Units - 2017" ("ABCL Incentive Scheme") pursuant to the Composite Scheme of Arrangement between erstwhile Aditya Birla Nuvo Limited and Grasim Industries Limited and the Company and their respective Shareholders and Creditors.

Scheme 2022, Scheme 2017 and ABCL Incentive Scheme are hereinafter collectively referred to as the "ESOP Schemes".

The aforesaid ESOP Schemes are in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 and the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (collectively referred to as "SEBI (SBEB) Regulations"), as applicable.

Aditya Birla Capital Limited Stock Appreciation Rights Scheme 2019

The Company also adopted "Aditya Birla Capital Limited Stock Appreciation Rights Scheme 2019" ("SARs Scheme 2019"), which is a cash-based plan linked to the actual stock price movement over the plan tenure.

Further, details on the ESOP Schemes and the SARs Scheme 2019 are provided in the Corporate Governance Report which forms part of this Annual Report.

There were no material changes made to the aforesaid schemes during the financial year under review.

The details/disclosure(s) on the aforesaid ESOP Schemes as required to be disclosed under the SEBI (SBEB) Regulations are available on the Company's website at https://www. adityabirlacapital.com/invRstor-rRlations/financial-reports.

Certificates from the Secretarial Auditors on the implementation of the ESOP Schemes will be made available via electronic mode at the ensuing 17^th (Seventeenth) Annual General Meeting ("AGM") of the Company for inspection by the Members.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Regulation 34(2) of SEBI Listing Regulations, the Management Discussion and Analysis Report for the financial year under review forms part of this Annual Report.

CORPORATE GOVERNANCE REPORT

The Corporate Governance Report as stipulated under Regulation 34(3) read with Schedule V of the SEBI Listing Regulations forms part of this Annual Report. The requisite certificate from M/s. N L Bhatia & Associates, Practising Company Secretaries (UIN: P1996MH055800) on compliance with the requirements of Corporate Governance forms part of this Annual Report.

STATEMENT CONTAINING SALIENT FEATURES OF THE FINANCIAL STATEMENTS OF SUBSIDIARY AND ASSOCIATE COMPANIES

A report on the performance and financial position of each of the Company's Subsidiary and Associate companies as per Section 129(3) of the Act read with the Companies (Accounts) Rules,

2014, in the prescribed Form AOC-1 is attached as Annexure II to the Board's Report.

RISK MANAGEMENT

Risk Management is at the core of our business and ensuring, we have the right risk-return trade-off in line with our risk appetite is the essence of our Risk Management practices, while looking to optimise the returns that go with that risk.

Board of Directors keep oversight on all the risks assumed. The Company being Core Investment Company (NBFC), the risks therefore largely relate to investments made in its Subsidiaries/ Associate(s). The operation of each of the Subsidiaries/ Associate(s), the risks faced by them, and the risk mitigation tools used to manage them are reviewed periodically by their Risk Management Committees and Boards of Directors.

The Subsidiaries/ Associate(s) of the Company also have well established Risk Management Frameworks designed to identify, assess, monitor and mitigate risks inherent in their business. The framework enables effective Risk Management through a structure of Committees, policies, internal controls and reporting. Three line of Defence Model is the core of Risk Management Governance in the Company wherein first line of defence i.e. Line Management take the accountability and ownership of Risk identification and its mitigation, second line of Defence viz. Risk and Compliance functions keep oversight on Risk and Compliance matters in the Company. Internal Audit being third Line of Defence provide Independent Assurance to Audit committee and Board by conducting Risk Based Audits.

Over the years, the Company and its Subsidiaries/ Associate(s) have built a strong Risk Management Framework supported by well- established policies, procedures, system and a talent pool of Risk Professionals.

From Risk Management perspective, Company, its Subsidiaries and Associate(s), Board of Directors are supported by Risk Management Committee(s) and Audit Committee(s) to ensure monitoring of risks and ensure effective functioning of the Governance framework. These Committees are governed by their respective Charters approved by Board of Directors.

• Risk Management Committee of the Board inter-alia reviews risk management policies of the Company pertaining to credit, market, liquidity and outsourcing risks and business continuity management. The Committee(s) also reviews the Risk Appetite and Enterprise Risk Management frameworks, Internal Capital Adequacy Assessment Process ("ICAAP") and stress testing. The Committees reviews the level and direction of major risks pertaining to credit, market,

liquidity, operational, reputational, technology, information security, compliance, group, and capital at risk as a part of the risk dashboard.

• Audit Committee of the Board provides direction to and monitors the quality of the internal audit function, oversees the financial reporting process and also monitors compliance with inspection and audit reports.

Further, in line with regulatory or risk management frameworks, respective Board committees are supported by Management level Credit Committees viz. Asset and Liabilities Management, Operational Risk Management and IT Strategy Committee, as applicable.

Business Continuity

The Company and its Subsidiaries/ Associate(s) have well documented Business Continuity Management Programmes which have been designed to ensure continuity of critical processes during any disruption. A robust Disaster Recovery framework has been put in place to ensure uninterrupted operations and service to customers.

In view of the increased move to digital modes of business and adoption of new technologies, there was an enhanced focus on Cyber Security and the Company, and its Subsidiaries/ Associate(s) continued to invest in a strong Cyber Defence Programme.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

During the financial year under review, all transactions entered into by the Company with related parties were in ordinary course of business and on arm's length basis and were not considered material as per the provisions of Section 188 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014. Hence, disclosure in Form AOC-2 under Section 134(3)(h) of the Act, read with the Rule 8 of the Companies (Accounts of Companies) Rules, 2014, is not applicable.

Prior approval of the Audit Committee is obtained for all Related Party Transactions ("RPTs") including omnibus approval for transactions which are of a repetitive nature and entered into in the ordinary course of business and at arm's length in accordance with the Policy on RPTs of the Company. A statement on RPTs specifying the details of the transactions pursuant to each omnibus approval granted, is placed on a quarterly basis for review by the Audit Committee.

Pursuant to Regulation 23(9) of SEBI Listing Regulations, disclosures of RPTs are submitted to the Stock Exchanges on a half-yearly basis and published on the Company's website at https://www.adityabirlacapital.com/investor-rRlations/ announcements-and-updates.

There were no material transactions entered into with related parties during the period under review, which may have had any potential conflict with the interests of the Company at large.

The details of transactions with related parties of the Company for the financial year under review, are given in notes to the Financial Statements, which forms part of this Annual Report.

The Policy on Related Party Transactions as approved by the Audit Committee and the Board, is available on the Company's website at https://www.adityabirlacapital.com/investor-ralations/policias-anri-coria.

INTERNAL FINANCIAL CONTROLS

The Company and its Subsidiaries/ Associate(s) have well established internal control systems in place which are commensurate with the nature of their business and size, scale and complexity of their operations. Standard Operating Procedures ("SOP") and Risk Control Matrices designed to provide a reasonable assurance are in place and are being continuously monitored and updated.

The Company along with its Subsidiaries/ Associate(s) also periodically engage outside experts to carry out independent review of the effectiveness of various business processes. The observations and best practices suggested are reviewed by the management and Audit Committee and appropriately implemented with a view to continuously strengthen internal controls.

INTERNAL AUDIT

The Company has in place an effective Internal Audit Framework to monitor the efficacy of internal controls with the objective of providing to the Audit Committee and the Board of Directors, an independent and reasonable assurance on the adequacy and effectiveness of the organisation's risk management, internal control and governance processes. The framework is commensurate with the nature of the business, size, scale and complexity of its operations with a Risk Based Internal Audit ("RBIA") approach.

The Company has implemented a RBIA Programme in accordance with the requirements of RBI circular dated 3^rd February 2021. The Internal audit plan is approved by the Audit Committee and Internal audits are undertaken on a periodic basis to independently validate the existing controls. Internal Audit Reports are regularly reviewed by the management and corrective action is initiated to strengthen controls and enhance the effectiveness of existing systems.

Significant audit observations, if any, are presented to the Audit Committee along with the status of management actions and the progress of implementation of recommendations.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act and to the best of their knowledge and belief and according to the information and explanations obtained from the operating management, Directors of the Company state that:

i) in the preparation of the Annual Accounts for the financial year ended 31^st March 2024, the applicable Accounting Standards have been followed and there were no material departures from the same;

ii) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March 2024 and of the profit/ loss of the Company for the financial year ended on that date;

iii) 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 fraud and other irregularities;

iv) the Directors had prepared the Annual Accounts on a 'going concern basis';

v) the Directors had laid down Internal Financial Controls and that such Internal Financial Controls were adequate and were operating effectively; and

vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Appointment / Re-Appointment / Resignation of Directors

As on 31^st March 2024, the Board of Directors of the Company ("the Board") comprised 7 (Seven) Directors including 1 (One) Woman Director.

Dr. Santrupt Misra (DIN: 00013625), ceased to be Non-Executive Non-Independent Director from the Board during the financial year under review.

Retirement by Rotation

Pursuant to Section 152 of the Act read with the Articles of Association of the Company, Mr. Romesh Sobti (DIN: 00031034), Non-Executive Non-Independent Director retires from the Board by rotation and being eligible, offers himself for reappointment at the ensuing AGM of the Company.

The Nomination, Remuneration and Compensation Committee of the Company and the Board of Directors have recommended the re-appointment of Mr. Romesh Sobti to the shareholders at the ensuing AGM. The information required to be disclosed under Regulation 36(3) of the SEBI Listing Regulations in case of re-appointment of Mr. Romesh Sobti is provided in the Notice of the ensuing AGM.

Declaration by Independent Directors

All Independent Directors have submitted their declaration of independence, pursuant to the provisions of Section 149(7) of the Act and Regulation 25(8) of the SEBI Listing Regulations, stating that they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations and they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence.

The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise and hold the highest standards of integrity.

All Independent Directors of the Company have registered their name in the data bank maintained with the Indian Institute of Corporate Affairs in terms of the provisions of the Companies (Appointment and Qualification of Directors) Rules, 2014.

Fit and Proper Criteria

All the Directors meet the fit and proper criteria stipulated under the RBI Master Directions, as amended.

Key Managerial Personnel and Senior Management Personnel

Mrs. Vishakha Mulye, Chief Executive Officer ("CEO"), Mrs. Pinky Mehta, Chief Financial Officer ("CFO") and Mr. Amber Gupta, Company Secretary and Compliance Officer are the Key Managerial Personnel of the Company as on 31^st March 2024 in terms of the provisions of Sections 2(51) and 203 of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The details of the Senior Management Personnel are provided in the Corporate Governance Report, which forms part of this Annual Report.

ANNUAL PERFORMANCE EVALUATION

The evaluation framework for assessing the performance of the Directors of the Company comprises contributions at the Meeting(s) and strategic perspective or inputs regarding the growth and performance of the Company provided by them, amongst others.

During the year under review, considering the evolving good governance practices in India, the Nomination, Remuneration and Compensation Committee ("NRC") approved revised Board Evaluation Framework.

Pursuant to the provisions of the Act and SEBI Listing Regulations and in terms of the Framework of the Board Performance Evaluation, the NRC and the Board of Directors have carried out an annual performance evaluation of the Board, performance of Individual Directors, various Committees of the Board and the Chairman. The manner in which the evaluation has been carried out has been set out in the Corporate Governance Report, which forms part of this Annual Report.

Outcome of the Evaluation

The Board of the Company was satisfied with the functioning of the Board and its Committees. Non-Executive Directors and Independent Directors demonstrate a strong understanding of the Company and its requirements. They keep themselves current on the areas to be discussed at the Board Meetings. The Committees are functioning well and besides covering the Committees' terms of reference, as mandated by applicable laws, important issues are brought up and discussed in the

Committee Meetings. The Board was also satisfied with the contribution of Directors in their individual capacities. The Board has full faith in the Chairman leading the Board effectively and ensuring participation and contribution from all the Board Members.

MEETINGS OF THE BOARD AND ITS COMMITTEES

The Board meets at regular intervals to discuss and decide on the Company's performance and strategies. During the financial year under review, the Board met 7 (Seven) times on 11^th May 2023, 1^st June 2023, 2^nd August 2023, 3^rd November 2023, 16^th January 2024, 1^st February 2024 and 11^th March 2024.

Further details on the Board, its Meetings, composition and attendance are provided in the Corporate Governance Report, which forms part of this Annual Report.

Audit Committee

The Company has constituted an Audit Committee with its composition, quorum, powers, role and scope in line with the applicable provisions of the Act, SEBI Listing Regulations and RBI Master Directions.

During the financial year under review, the Audit Committee reviewed the internal controls put in place to ensure that the accounts of the Company are properly maintained and that the accounting transactions are in accordance with prevailing laws and regulations. In conducting such reviews, the Committee found no material discrepancy or weakness in the internal control system of the Company.

Further details on the Audit Committee, its Meetings, composition and attendance are provided in the Corporate Governance Report, which forms part of this Annual Report.

During the financial year under review, all recommendations made by the Audit Committee were accepted by the Board.

Nomination, Remuneration and Compensation Committee

The Company has constituted a Nomination, Remuneration and Compensation Committee ("NRC"), with its composition, quorum, powers, role and scope in line with the applicable provisions of the Act, SEBI Listing Regulations and directions/ guidelines/ framework issued by RBI.

Further details on the NRC, its Meetings, composition and attendance are provided in the Corporate Governance Report, which forms part of this Annual Report.

During the year under review, RBI has issued Guidelines on Compensation of Key Managerial Personnel (KMP) and Senior Management in NBFCs which came into effect from 1^st April 2023.

The Executive Remuneration Philosophy/ Policy of the Company which was formulated under the provisions of Section 178(3) of the Act and SEBI Listing Regulations, was amended with effect from 1^st April 2023 to align with the directions/ guidelines/ framework issued by RBI as applicable. The said Policy is attached as Annexure III to the Board's Report and the same is uploaded on the website of the Company at https://www. adityabirlacapital.com/investor-rRlations/ policies-and-code.

Other Committees

The Board of Directors has also constituted the following Committees:

• Corporate Social Responsibility Committee

• Stakeholders' Relationship Committee

• Risk Management Committee

• PIT Regulations Committee

• IT Strategy Committee

• Asset Liability Management Committee

• Asset Monetisation Committee

More information on all of the above Committees including details of their Meetings, composition and attendance are provided in the Corporate Governance Report, which forms part of this Annual Report.

ANNUAL RETURN

Pursuant to the provisions of Section 134(3)(a) of the Act, the Annual Return in Form MGT-7 of the Company for the financial year 2023-24 is available on the Company's website at https:// www.adityabirlacapital.com/investor-relations/financial-reports

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

No significant or material orders were passed by the Regulators or Hon'ble Courts or Tribunals which would impact the going concern status and Company's operations in future.

AUDITORS

Statutory Auditors, their Report and Notes to Financial Statements

Pursuant to the provisions of Section 139 of the Act and the Companies (Audit and Auditors) Rules, 2014, SEBI (Listing Regulations) and Circular no. RBI/2021-22/25 Ref. No. DoS. CD.ARG/SEC.01/08.91.001/2021-22 dated 27^th April 2021 issued by RBI on Guidelines for appointment of Statutory Auditors ("RBI Circular") as amended, B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W-100022) were appointed as Statutory Auditors of the Company for a term of 3 (Three) continuous years from the conclusion of 14^th (Fourteenth) AGM till the conclusion of 17^th (Seventeenth) AGM of the Company. Thus, the tenure of B S R & Co. LLP, Chartered Accountants would end at the conclusion of the ensuing AGM.

Consequent to the completion of term of Statutory Auditors (B S R & Co. LLP, Chartered Accountants) at the 17^th AGM, the Board of Directors, based on the recommendation of the Audit Committee, have recommended the appointment of M. M. Nissim & Co. LLP, Chartered Accountants (ICAI Firm Registration No. 107122W/W100672) as Statutory Auditors of the Company for a term of 3 (Three) continuous years from the conclusion of 17^th (Seventeenth) AGM till the conclusion of 20^th (Twentieth) AGM of the Company for the approval of shareholders of the Company in the forthcoming AGM.

The Company has received a letter from M. M. Nissim & Co. LLP, Chartered Accountants confirming that they are not disqualified to act as Statutory Auditors of the Company and they comply with the eligibility criteria/requirements specified under Section 141(3) of the Companies Act and the RBI Circulars.

The observation(s) made in the Auditor's Report are selfexplanatory and therefore, do not call for any further comments under Section 134(3)(f) of the Act.

The Auditor's Report does not contain any qualifications, reservations, adverse remarks or disclaimer.

Secretarial Audit and Secretarial Compliance Report

Pursuant to the requirements of Section 204(1) of the Act read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed M/s. N L Bhatia, Practising Company Secretaries, to conduct the Secretarial Audit for the financial year under review. The Secretarial Audit Report in Form MR-3 for the financial year under review, as received from M/s. N L Bhatia, Company

Secretaries, is attached as Annexure IV to the Board's Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Pursuant to Regulation 24A of the SEBI Listing Regulations, the Annual Secretarial Compliance Report for the financial year under review will be submitted to the Stock Exchanges and uploaded on the website of the Company at https://www. adityabirlacapital.com/investor-relations/announcements-and-updates.

Cost Records and Auditors

The provisions of Cost Records and Cost Audit as prescribed under Section 148 of the Act are not applicable to the Company.

Reporting of Frauds by Auditors

None of the Auditors of your Company, i.e. the Statutory Auditors and Secretarial Auditors have reported any incident of fraud to the Audit Committee or the Board of Directors under Section 143(12) of the Act during the financial year under review.

CORPORATE SOCIAL RESPONSIBILITY

In accordance with Section 135 of the Act, the Company has constituted a Corporate Social Responsibility ("CSR") Committee.

The CSR Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy ("CSR Policy") indicating the activities to be undertaken by the Company, which has been approved by the Board. The CSR Policy is available on the Company's website at https://www.adityabirlacapital.com/ investor-relations/policies-and-code.

During the financial year under review, the Company was not required to make any expenditure towards CSR projects, in absence of average net profit for three immediately preceding financial years calculated in accordance with the provisions of Section 198 of the Act. Accordingly, no CSR activity was undertaken by the Company. Considering that the Company was not required to contribute any amount towards CSR activities, report on activities as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 has not been furnished.

Further, details on the CSR Committee are provided in the Corporate Governance Report, which forms part of this Annual Report.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

In compliance with the provisions of Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board

and its Powers) Rules, 2014 and Regulation 22 of the SEBI Listing Regulations, the Company has formulated a Whistle Blower Policy/ Vigil Mechanism for Directors and Employees to report concerns, details of which are covered in the Corporate Governance Report, which forms part of this Annual Report.

The said policy is available on the Company's website at https:// www.adityabirlacapital.com/investor-relations/policies-and-code

POLICY ON PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The Company has in place a policy which is in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. An Internal Committee has been set up to redress complaints, if any, received regarding sexual harassment of women employees. The Company has complied with the provisions relating to the constitution of Internal Committee under the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During the financial year under review, there were no complaints received under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has complied with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

HUMAN RESOURCES

The Company along with its Subsidiaries and Associate(s) has always aspired to be an organization and a workplace which attracts, retains and provides a canvas for talent to operate. 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.

We believe that meaning at work is created when people relate to the purpose of the organisation, feel connected to their leaders and have a sense of belonging. Our focus stays strong on providing our people a work environment that welcomes diversity, nurtures positive relationships, provides challenging work assignments and opportunities based on meritocracy for people to grow and build their careers with us in line with their aspirations.

As on 31^st March 2024, the employee strength of the Company was 21 and along with the Subsidiaries and Associate(s) it had 46600 employees.

The workforce along with Subsidiaries and Associate(s) comprises of more than 62% millennial and 31% women as on 31^st March 2024.

Building Capabilities, Enabling Success

We aim to build organizational capabilities that ensure ABCL, and its subsidiaries win in the marketplace and succeed together. We achieve this by igniting purpose, amplifying connections, and fostering a strong sense of belonging. Our focus is on creating an inclusive, diverse environment that nurtures relationships, challenges boundaries, and provides boundless, merit-based growth opportunities.

Talent Management & Succession Planning

Our talent management strategy focuses on cultivating a robust, future-ready talent pool and building a strong leadership succession pipeline. We prioritize discovering and developing high-potential and high-performing employees through comprehensive, future-focused development programmes. Our goal is to shape leaders driven by a zeal for customer value and executional excellence. We also emphasize enhancing futurerelevant skills in Digital, Technology, Risk, and Analytics through various initiatives and collaborations with global entities.

Employee Wellness and Engagement

Our commitment to a vibrant, engaging work environment and employee wellbeing exemplifies our forward-thinking corporate culture. We prioritize connection and camaraderie through events, town halls, leadership sessions, and milestone celebrations, ensuring employees feel valued and engaged. This strategy enhances employee connectivity and morale, boosting productivity and motivation.

We emphasize employee wellbeing as a core operational philosophy, adopting a holistic approach encompassing Physical, Emotional, Financial, Intellectual and Social dimensions. Our comprehensive wellness solutions and health coaching demonstrate our dedication to fostering a healthier, more satisfying workplace.

Learning and Development

We prioritize continuous learning and growth, offering employees valuable opportunities through our AI-enabled learning app and our Gyanodaya Virtual Campus (GVC), which includes courses, videos and webinars. Our employees access e-learning courses, video modules, micro-learning resources and sustainability courses for flexible, self-paced learning.

The AB Capital app supports our frontline sales teams with courses on induction, regulatory matters, products, processes and functional training. We also focus on building capabilities for frontline managers and provide multi-product training to support cross-selling and up-selling. This training is integrated into our onboarding process to benefit all employees.

SUSTAINABILITY

Sustainability is one of the key focus areas for us and being a CIC, the Company drives the sustainability practices in its Subsidiaries and Associate(s), centrally. The sustainability efforts are aligned with Aditya Birla Group's sustainability strategy and purpose statement. The Company has identified three main categories to implement sustainability across its Subsidiaries and Associate(s) namely, Environment, Social and Governance. We have introduced 25 industry specific ESG scorecards based on the UN's Equator Principles in the infrastructure lending business. One of our subsidiaries raised ?1,000 Crore in green loans from the International Finance Corporation to finance renewable energy projects. Through its subsidiary, Aditya Birla Sun Life AMC Limited, the Company has also launched an ESG-focused equity fund with an AUM of more than ?677 Crore as of 31^st March 2024. Financial inclusion and serving the underbanked have been key focus areas for our subsidiaries engaged in lending to SMEs, supply chain finance for small vendors, affordable housing, rural insurance, and micro-SlPs, with our portfolio expanding to urban, semi-urban, and rural parts of India. We've reduced our environmental impact through the installation of solar panels totalling 140 kW across some branches, demonstrating a commitment to clean energy. Our innovative 'PadCareX' initiative with PadCare Labs recycled 38,048 sanitary pads in FY24, conserving 2,039 kg of carbon equivalent and saving 19,023 litres of landfill space. Additionally, our recycling efforts processed around 33,738 kg of dry waste, preventing 90.61 MTCO₂ emissions.

The Enterprise Risk Management function plays an integral part in managing sustainability risk across all businesses. The Chief Risk Officer ("CRO") guides and governs the sustainability strategy across the businesses.

The detailed Sustainability Report will be made available on the website of the Company at https://www.adityabirlacapital. com/investor-relations/sustainability-reports.

SECRETARIAL STANDARDS OF INSTITUTE OF COMPANY SECRETARIES OF INDIA

The Company is in compliance with the Secretarial Standards specified by the Institute of Company Secretaries of India ("ICSI") on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2).

CODE FOR PROHIBITION OF INSIDER TRADING

Pursuant to SEBI (Prohibition of Insider Trading) Regulation 2015, as amended, the Company has a Board approved code of conduct to regulate, monitor and report trading by Insiders and a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information.

Further details on the same are covered in the Corporate Governance Report, which forms part of this Annual Report.

AWARDS AND RECOGNITIONS

During the financial year under review, the Company and its Subsidiaries and Associate(s) have been felicitated with awards and recognitions across various functional areas which has been elaborated under Awards and Recognitions section in this Annual Report.

OTHER DISCLOSURES

In terms of applicable provisions of the Act and SEBI Listing Regulations, the Company discloses that during the financial year under review:

i) there was no issue of shares (including Sweat Equity Shares shares) to employees of the Company under any scheme save and except under Employee Stock Option Scheme referred to in this Report.

ii) there was no Scheme for provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

iii) there was no public issue, rights issue, bonus issue etc. other than Qualified Institutional Placement and Preferential Issue as disclosed in this Report.

iv) there was no issue of shares with differential rights.

v) there was no transfer of unpaid or unclaimed amount to Investor Education and Protection Fund ("IEPF").

vi) there were no proceedings for Corporate Insolvency Resolution Process initiated under the Insolvency and Bankruptcy Code, 2016.

vii) there was no failure to implement any Corporate Action.

viii) there were no borrowings from Banks or Financial Institution and no instance of one-time settlement with any Bank or Financial Institution.

ACKNOWLEDGEMENTS

The Board takes this opportunity to express its appreciation for the support and co-operation extended by our various partners and other business associates. The Board gratefully acknowledges the ongoing co-operation and support provided by all Statutory and Regulatory Authorities.

The Board also acknowledges the support and contribution of Company's Bankers, Stock Exchanges, Registrar of Companies, Depositories, the Reserve Bank of India, Securities and Exchange Board of India, Central and State Governments and other regulatory bodies and the shareholders who have always supported and helped the Company to achieve our objectives.

The Board places on record its appreciation for the exemplary contribution made by the employees of the Company and its Subsidiaries and Associate(s) at all levels. Their dedicated efforts and enthusiasm have been pivotal to the Company's and its Subsidiaries and Associate(s)' growth.

By order of the Board of Directors For Aditya Birla Capital Limited

Kumar Mangalam Birla

Date: 13^th May 2024 Chairman

Place: Mumbai DIN: 00012813