Your directors are pleased to present the 56^th Annual Report on the business and operations of the Company along with
Audited Standalone and Consolidated Financial Statements for the year ended 31^st March, 2026.

1. FINANCIAL PERFORMANCE AND HIGHLIGHTS

The financial highlights of your Company for the Financial Year 2025-26 are briefly mentioned below to give an overview
of accomplishments on all fronts:

During the period, your Company has performed very well by witnessing a growth of 48.92% in Profit after Tax (PAT).
Your Company has seen a growth of 22.30% in its Net Worth that has reached Rs.21,977.20 Crore in Financial Year
2025-26 from Rs.17,969.79 Crore in Financial Year 2024-25.

Consolidated Financial Statements

Pursuant to Section 129(3) of the Companies Act, 2013, the Company has prepared Consolidated Financial Statement
(CFS) in respect of only one Associate Company namely Shristi Urban Infrastructure Development Limited and an
appropriate disclosure stating the reasons relating to non-consolidation of accounts of other three companies have been
given in the CFS.

A Statement containing salient features of Financial Statements of Joint Venture and Associate Companies, has been
given in the prescribed format "AOC-1" and is annexed as part of the Consolidated Financial Statements.

There are no material changes and commitments, occurred subsequent to the close of Financial Year of the Company
and the date of this Board's report, affecting the financial position of the Company and its state of affairs.

Pursuant to Section 136 of the Companies Act, 2013, the Audited Financial Statements and all other documents required
to be attached with the Financial Statements are available on the Company's website at www.hudco.org.in and are also
available for inspection till the date of the ensuing Annual General Meeting during business hours on all working days at
the Registered Office of the Company

2. DIVIDEND

Your Company is consistently rewarding its shareholders by way of dividend payment. The Board of Directors, have
recommended payment of Final Dividend @ 15.00%, i.e. Rs.1.50 per equity share having Face Value of Rs.10/- each
for the Financial Year 2025-26, subject to approval of the Shareholders at the ensuing 56^th Annual General Meeting.

The above dividend is in addition to following Interim Dividends declared for the Financial Year 2025-26 on the paid-up
equity share capital of the Company:

In view of above, total dividend declared and paid for the Financial Year 2025-26 would be amounting to Rs.6.05 per
equity share (60.50%).

In compliance with regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015, your Company has formulated Dividend Distribution Policy, and the same is available
on Company's website at https://www.hudco.org.in//writereaddata/DDP.pdf

As per guidelines issued by Department of Investment and Public Asset Management (DIPAM), Government of India, the
NBFC Company is required to pay a minimum Annual Dividend of 30% of Profit after Tax (PAT), subject to maximum limit
prescribed by RBI. After analysis of various financial parameters (including CRAR, Net NPA etc), Cash Flow Position
and available distributable profits, the Board of Directors have paid/recommended Total Dividend of Rs.6.05 per equity
share (60.50%).

3. SHARE CAPITAL

As on 31^st March, 2026, the authorized share capital of the Company was Rs.2,500 Crore with issued, subscribed
and paid-up equity share capital of Rs.2,001.90 Crore. The paid-up share capital comprises Promoters shareholding
of 75.00% held by the President of India through the Ministry of Housing and Urban Affairs (MoHUA) - 54.27% and
Ministry of Rural Development (MoRD) - 20.73% and the balance 25.00% is held by the Public. There is no change in
the authorized, issued, subscribed and paid-up equity share capital of the Company during the year.

The Company has not issued any shares with differential voting right/ Sweat Equity Shares during the year under report.
Listing of securities and payment of listing fee

The securities of the Company are listed at BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) and
the annual listing fee for the Financial Year 2026-27 has been paid to the Stock Exchanges.

Transfer of unclaimed Dividend and Shares to Investor Education & Protection Fund
Amounts transferred to IEPF

In compliance of the provisions of Section 125 of the Companies Act, 2013 and Rule made thereunder read with relevant
provisions of SEBI (LODR) Regulations, 2015 as amended from time to time, the dividend amounts, which remain
unpaid/unclaimed for a period of seven years, are transferred to the Investor Education and Protection Fund (IEPF) of
the Central Government.

Accordingly, during the Financial Year 2025-26, an amount of Rs.9,63,667.25 pertaining to unclaimed dividend for
the Financial Year 2017-18 and Interim/Final dividend declared on shares already transferred to IEPF, have been
transferred to Investor Education and Protection Fund.

Equity Shares transferred to IEPF

In terms of Section 124(6) of the Companies Act, 2013 and IEPF Authority (Accounting, Audit, Transfer and Refund)
Rules, 2016, as well as in accordance with the circulars/notifications issued by the MCA from time to time, the shares in
respect of which the dividend has not been paid or claimed for a consecutive period of seven years or more, is required
to be transferred to Investor Education and Protection Fund (IEPF) Authority account.

Accordingly, during the Financial Year 2025-26, 7037 equity shares pertaining to Interim/final dividend for the Financial
Year 2017-18 were transferred to the Demat Account of the IEPF Authority opened with NSDL.

Details of the shareholders whose unclaimed dividend/shares were transferred to the IEPF Account is available on
the website at the following link: https://hudco.org.in//writereaddata/shares-transferred-to-IEPF-authority-17-18.pdf
Members may check their details on the aforesaid web-link.

Claim from IEPF Account

Any person, whose share or unclaimed dividend etc. has been transferred to the IEPF, may claim the shares under
provision to sub-section (6) of section 124 or apply for refund under clause (a) of sub-section (3) of section 125 or under
proviso to sub-section (3) of section 125 of the Companies Act, 2013, as the case may be, to the Authority by making
an online application in Form IEPF-5.

4. MEMORANDUM OF UNDERSTANDING (MoU)

As a Central Public Sector Enterprise (CPSE), your Company enters into an Annual Memorandum of Understanding
(MoU) with the Ministry of Housing and Urban Affairs (MoHUA), which serves as the overarching framework for evaluating
organizational performance across a set of mutually agreed financial and non-financial parameters, benchmarked
against annual targets prescribed by the Department of Public Enterprises (DPE).

Your Directors are proud to share that your Company achieved an exceptional MoU score of 97.90 out of 100, an
'Excellent' MoU Rating, for the performance in Financial Year 2024-25, setting a benchmark among its financial-sector
peers and reaffirming its position as a high-performing and dependable public sector undertaking. This is the second
consecutive year of 'Excellent' MoU rating- the highest classification under the DPE's performance evaluation framework,
reflecting the consistency and strategic focus with which the Company pursues its corporate objectives.

HUDCO excelled in 9 out of 12 performance parameters, achieving perfect scores of 100% in several critical areas,
underscoring the Company's strong governance framework, operational efficiency, and commitment to its social
mandate. With respect to the Compliance Parameters, your Company recorded near-full compliance across all
prescribed areas, including Corporate Governance, Corporate Social Responsibility (CSR), Procurement from Micro
and Small Enterprises (MSEs), and Health & Safety initiatives undertaken for the benefit of its employees.

During Financial Year 2025-26, your Company demonstrated an outstanding performance across both operational and
financial metrics, exceeding its own performance benchmarks. This achievement stands out as a strong testament to
HUDCO's commitment to performance excellence, financial prudence, and institutional accountability. Your Directors
remain confident that the Company is well-positioned to sustain and build upon this performance trajectory in the years
ahead. The Annual MoU signed with MoHUA for Financial Year 2025-26 comprises 11 Main Performance Parameters,
predominantly financial in nature, and 9 Compliance Parameters. The actual achievements against key parameters are
set out in the following table:

MoU 2025 - 26: Achievement of Key Performance Parameters (as on 31.03.2026)

In compliance with DPE's O.M, dated 24^th March, 2026, issued for performance evaluation of CPSEs for MoU Financial
Year 2025-26, the mandatory parameters to be included in the Annual Report are annexed and form part to the Directors'
Report.

5. LENDING ACTIVITIES

HUDCO, India's foremost techno-financing institution under the Ministry of Housing and Urban Affairs, has successfully
concluded another landmark year of dedicated service to the nation. Despite a dynamic and challenging environment,
the organization demonstrated promising operational resilience and financial performance. Through its continued
support for infrastructure development and housing initiatives across the country, HUDCO has further strengthened its
role as a key catalyst in India's urban transformation and nation-building journey.

During the Financial Year 2025-26, HUDCO, driven by proactive management, prudent business strategies and
policies, recorded remarkable growth in its operational performance. The organization achieved sanctions amounting
to Rs.1,64,757.79 Crore and disbursements of Rs.51,194.21 Crore, reflecting a significant increase over the previous
year's sanctions of Rs.1,27,952.49 Crore and disbursements of Rs.40,037.51 Crore. These achievements underscore
HUDCO's sustained commitment to financing infrastructure and housing development across the nation.

Since its establishment in 1970, HUDCO has built a distinguished legacy spanning 56 years of dedicated service
to the nation. Over this period, the organization has sanctioned 17,537 urban infrastructure and housing projects,
with cumulative loan sanctions amounting to Rs.6,03,463.90 Crore and disbursements reaching Rs.3,11,006.76 Crore.
HUDCO has also extended financial assistance for more than 204 lakh dwelling units across rural and urban India.
Notably, 93.6% of these units, representing 190.9 lakh dwelling units, have been targeted towards the Economically
Weaker Sections (EWS) and Lower Income Groups (LIG), reaffirming HUDCO's enduring commitment to inclusive and
affordable housing development.

Urban Infrastructure Lending

HUDCO sanctioned 90 projects in Urban infrastructure sector during the year, extending total loan assistance of
Rs. 1,55,344.74 Crore across key sectors including Transport & Logistics, Water & Sanitation, Energy, Social and
Commercial Infrastructure, and other infrastructure segments. The organization disbursed Rs.45,924.53 Crore during
the year towards the implementation of various infrastructure development schemes, further reinforcing its commitment
to strengthening India's infrastructure landscape.

Housing Operations

Under the Housing sector during the year, HUDCO sanctioned 6 projects with total loan assistance of Rs.9,413.05
Crore, facilitating the construction of 2,22,076 dwelling units across the country. During the year, the organization also
disbursed a loan amount of Rs.5,269.68 Crore, reaffirming its continued commitment to promoting affordable housing
and supporting inclusive urban development.

In the Financial Year 2025-26, major projects sanctioned and loan disbursed are as under:

Transport and Logistics

The Twin Tunnel Project of Bruhat Bengaluru Mahanagara Palike, being implemented through Bengaluru Smart
Infrastructure Limited (BSMILE), is a major urban mobility initiative aimed at decongesting traffic in Bengaluru through

high-capacity underground corridors. HUDCO has extended a loan of Rs. 9,303.66 Crore to support this transformative
development, underscoring its pivotal role in financing complex urban mobility solutions across the country. HUDCO's
financial intervention not only enables timely execution of this critical mobility project but also reinforces its broader
mandate of strengthening India's urban infrastructure.

HUDCO has extended financial assistance of Rs.1,624.34 Crore to Chennai Metro Asset Management Limited (CMAML)
for implementing Transit Oriented Development (TOD) across four prime locations adjoining Chennai Metro stations,
aimed at creating vibrant, integrated commercial and urban hubs that strengthen last-mile connectivity and enhance the
economic potential of the metro network.

HUDCO financed loan of Rs.1,539.87 Crore to Maharashtra Rail Infrastructure Development Corporation Limited
(MRIDCL) for construction of 52 Road Over Bridges (ROB), Road Under Bridges (RUB), and Limited Height Subways
(LHS) at strategically identified locations across Maharashtra to eliminate both manned and unmanned railway level
crossings. The initiative aims to ensure safe and seamless movement of road and rail traffic, reduce accident risks, and
alleviate congestion in urban and semi-urban areas.

HUDCO had sanctioned a loan of Rs.27,000 Crore to Bangalore Development Authority during the previous Financial
Year for the land acquisition and development of the Bangalore Business Corridor - Peripheral Ring Road (PRR) project
in Bengaluru, with an initial disbursement of Rs.50 Crore made during the Financial Year 2025-26. This strategically
significant project is aimed at decongesting the city, enhancing traffic efficiency, and improving connectivity across key
urban and peri-urban areas.

HUDCO had sanctioned a loan of Rs.22,250 Crore during the previous Financial Year to Maharashtra State Road
Development Corporation for land acquisition for the Virar-Alibaug Multimodal Corridor project. During Financial Year
2025-26, an amount of Rs.3,400 Crore has been released towards the project. This strategically significant corridor is
envisaged as an Outer Ring Road for the Mumbai Metropolitan Region (MMR), providing high-speed connectivity to key
growth centres.

HUDCO had sanctioned a loan of Rs.11,000 Crore during the previous Financial Year to Andhra Pradesh Capital Region
Development Authority (APCRDA) for the construction of housing, office buildings, and infrastructure development in
Amaravati, the new capital city of Andhra Pradesh. During Financial Year 2025-26, an amount of Rs.2,196.83 Crore
has been disbursed towards the project, supporting planned urban development and creation of modern infrastructure
assets.

Energy

HUDCO has sanctioned a total loan of Rs.6,426 Crore to Rajasthan's three DISCOMs i.e; JdVVNL, AVVNL, and JVVNL-
for the installation of 1.1 kW and above rooftop solar systems at individual residential households under the PM Surya
Ghar: Muft Bijli Yojana. Targeting 37.80 Lakh residential consumers, the programme provides both Central and State
Financial Support, with HUDCO financing the state's share to enable seamless implementation. The project significantly
expands decentralized renewable energy capacity, reduces household electricity expenditure, and strengthens energy
access across Rajasthan.

A term loan of Rs.1,700 Crore has been extended to Maharashtra State Power Generation for the 400 MWAC grid-
connected, ground-mounted Solar PV Renewable Energy Bundling Project (Phase-I) in Maharashtra, a key initiative
to substantially enhance the state's renewable power capacity. The project will accelerate clean-energy generation,
reduce dependence on fossil fuels, and contribute to India's national targets for large-scale renewable integration. This
intervention reflects HUDCO's broader commitment to financing transformational infrastructure that delivers long-term
environmental and socio-economic benefits across the country.

HUDCO has sanctioned a loan of Rs.801.51 Crore to Andhra Pradesh Power Generation Corporation Ltd (APGENCO)
for undertaking Renovation & Modernization (R&M) and Life Extension of thermal power stations. The project focuses
on revitalizing aging power assets to enhance efficiency, reliability, and availability, while optimizing existing generation
capacity in a cost-effective manner. It is expected to result in improved operational performance, extended plant life, and
better safety and environmental standards, thereby strengthening the overall power infrastructure. Out of the sanctioned
amount, Rs.80 Crore has already been disbursed.

During Financial Year 2025-26, HUDCO disbursed Rs.1,000 Crore to the Tamil Nadu Power Distribution Corporation
Ltd. (TNPDCL), against a sanction accorded in previous Financial Year. This financial assistance is directed toward the
improvement and modernization of the power distribution network across Tamil Nadu, reflecting HUDCO's continued
focus on strengthening vital state-level utility infrastructure.

Water and Sanitation

HUDCO sanctioned financial assistance of Rs.340 Crore to the State Industries Promotion Corporation of Tamil Nadu
Limited (SIPCOT). This term loan will fund SIPCOT's contribution toward the development of a 60 MLD Desalination
plant and associated product water conveyance mains at Mullakadu Village in Tuticorin District, Tamil Nadu. The project
is being executed on a Hybrid Annuity Model (HAM) under the Public-Private Partnership (PPP) framework, reinforcing
HUDCO's support for critical water infrastructure.

HUDCO is providing Rs.938.51 Crore as gap funding to the Maharashtra Urban Infrastructure Fund (MUIF) for the
augmentation of Water Supply Project of Chhatrapati Sambhajinagar and Mira Bhayander Municipal Corporation
under the AMRUT 2.0 mission. HUDCO's financing enables timely execution of the project, supports inclusive urban
development, and significantly enhances the quality of life for residents by improving access to reliable and safe drinking
water. Out of the total sanctioned amount, Rs.116.43 Crore has already been disbursed.

Rajasthan Water Supply and Sewerage Corporation (RWSSC) has secured financial assistance of Rs.5,000 Crore
from HUDCO for implementing a wide range of water supply schemes under Jal Jeevan Mission (Phase III). This major
investment aims to enhance potable water availability and ensure sustainable household tap-water connectivity across
multiple regions of Rajasthan. The project will significantly strengthen drinking water infrastructure, reduce regional
water scarcity, and improve public health outcomes for urban and rural communities.

HUDCO sanctioned a term loan of Rs.2,944 Crore to the Hyderabad Metropolitan Water Supply & Sewerage Board
(HMWSSB). This financial assistance is earmarked for the execution of the Godavari Drinking Water Supply Project
Phase-II, along with the rejuvenation of the Osmansagar and Himayathsagar reservoirs as part of the comprehensive
Musi River clean-up initiative. This partnership underscores HUDCO's ongoing commitment to financing vital public
health and environmental infrastructure.

Social and Commercial Infrastructure

HUDCO sanctioned a substantial financial assistance of Rs.3,826.50 Crore to the Maharashtra Industrial Development
Corporation (MIDC). This term loan is earmarked for the development of Industrial Parks at 13 distinct locations across
multiple districts in Maharashtra. This strategic partnership underscores HUDCO's ongoing commitment to financing
robust core infrastructure and supporting the expansion of the state's industrial footprint.

HUDCO sanctioned a term loan of Rs.5,000 Crore to the AP State Special Projects Development Corporation Ltd.
(APSPDCL) to fund the comprehensive development of three new Industrial Parks in the state of Andhra Pradesh.
Against this sanction, an amount of Rs.2,072 Crore has been disbursed. This financial assistance reflects HUDCO's
continued focus on supporting and executing vital, state-led industrial infrastructure projects.

Demonstrating its sustained support for state-led economic initiatives, HUDCO sanctioned financial assistance of
Rs.1,700 Crore to the State Industries Promotion Corporation of Tamil Nadu Limited (SIPCOT). This vital funding
facilitates the establishment of the SIPCOT Industrial Park (Echur Scheme) and fulfills the remaining land cost
requirements for the Manallur Phase III Scheme, directly enhancing the state's industrial infrastructure footprint.
Housing

The implementation of the EWS Affordable Housing Scheme (Indiramma Indlu) in Telangana, under PMAY(G) by the
Telangana State Housing Corporation Limited (TGHCL), with financial support of Rs.5,000 Crore from HUDCO which
ensures significant improvement in the rural living conditions through the construction of 146,628 dwelling units. It reflects
the HUDCO's commitment in India's vision of inclusive growth, poverty alleviation, and sustainable rural development.
Out of the total sanctioned Loan, Rs.1,500 Crore has been disbursed.

The EWS Rural Housing Scheme across various Gram Panchayats in Kerala funded by HUDCO with a loan assistance
of Rs.1,500 Crore against which Rs.400 Crore has already been disbursed, has a significant socio-economic impact for
India, particularly in advancing inclusive growth and social equity. By supporting the construction of 31,679 new houses
and the completion of 43,321 in-progress houses totalling 75,000 dwelling units, the project strengthens the “Housing
for All” vision under the LIFE Mission of the Government of Kerala.

The housing project of Central Government Employees Welfare Housing Organization, supported by a term loan of
Rs.92 Crore from HUDCO, out of which Rs.70.94 Crore has already been disbursed, envisages the development of
144 well-planned 3 BHK and 4 BHK dwelling units for Central Government employees. The project will enhance access
to quality housing, promote planned urban development, and support the long-term welfare and social security of the
workforce while reinforcing the role of institutional housing initiatives in India.

Sectorial overview and government initiative:

Support to Economically Weaker Sections

HUDCO has consistently made focused efforts to serve underserved sections of society while supporting the flagship
initiatives of the Government of India. The organization remains committed to fulfilling the housing needs of Economically
Weaker Sections (EWS) and Low-Income Groups (LIG) by providing financial assistance and loans at comparatively
affordable interest rates. So far, the Company has sanctioned financial assistance for over 204 Lakh housing units in
both rural and urban areas across the country. Demonstrating its strong social commitment, nearly 190.9 Lkh housing
units, more than 93.6% of the total sanctions, have been directed towards beneficiaries belonging to the EWS and LIG
categories.

HUDCO's Support for projects in the North-Eastern Region

HUDCO continues to support the development of the North Eastern Region through financial assistance for housing and
infrastructure projects. During FY 2025-26, HUDCO disbursed Rs.54.94 Crore across 9 projects in the region, including
three housing schemes and six infrastructure projects. The assistance includes construction of the Manipur Institute
of Performing Arts at Gurgaon, staff quarters and basement parking at Dwarka, New Delhi, multi-storeyed government
quarters (G+7) at Langol, District Office Complex Mokokchung, Nagaland State Commission Complex, PWD Complex
Tuensang Phase-I, and SDO Office Complex at Pfutsero etc. reflecting HUDCO's commitment to strengthening
infrastructure in the North Eastern Region.

HUDCO's role in Government of India scheme(s) - Pradhan Mantri Awas Yojana

HUDCO is committed to supporting the Ministry of Housing and Urban Affairs (MoHUA) in the implementation of
PMAY(U)-2.0, which aims to provide financial assistance to One Crore urban poor and middle-class families (EWS/
LIG/MIG categories) to construct, purchase, or rent affordable houses in urban areas over five years, starting from
September 1, 2024.

HUDCO has been entrusted by MoHUA for desk and/or site scrutiny in respect of Affordable Housing in Partnership
(AHP) and Beneficiary Led Construction (BLC) vertical and also designated as one of the Central Nodal Agencies under
the Interest Subsidy Scheme (ISS) vertical. Further, for meeting fund requirement of State/ULB/Beneficiary share,
HUDCO also offers viability gap funding/ loan assistance to meet the requirement beyond the grant available from the
Government of India.

HUDCO, as Central Nodal Agency (CNA), under PMAY(U)-2.0 Interest Subsidy Scheme (ISS), has disbursed subsidy
of Rs.30.01 Lakh to 79 beneficiaries during 2025-26.

Property Development and Consultancy

HUDCO extends its consultancy expertise across India in urban & regional planning, architecture, environmental
engineering, construction, and project management, prioritizing green and sustainable solutions.

The consultancy assignments undertaken by HUDCO are diverse in nature and include DPR preparation for
Ummedpura Affordable Housing Project, Samvidhan Park in Kota, various urban infrastructure development works
in Sojat, Rajasthan, Development of White Town in Puducherry under the Challenge Based Destination Development
(CBDD ) Scheme (a sub-scheme of Swadesh Darshan 2); Development of Inter State Bus Terminal at ECR Road,
Puducherry, Placemaking and Beautification in three locations in Chennai for Chennai Metro Rail Limited, Housing
Project at Bengaluru to Hindustan Aeronautics Limited incorporating green building concepts, Karnataka Slum
Development Board for Social Housing Rehabilitation Project taken up in PPP mode in Bengaluru, Phase II of the
Shehjar Apartments at Bemina, Srinagar for the Srinagar Development Authority. HUDCO is also involved in further
stages of ongoing planning consultancy assignment for GIS based Integrated Master Plan for Rajgir Regional Planning
Area and Nalanda Mahavihara World Heritage Site in Bihar, as well as preparation of Land Use Maps & Registers and
Land Use and Development Control Plan for Bidhannagar MC Area and Nabadiganta Industrial Township Area in West
Bengal.

HUDCO has undertaken project works for development of its vacant properties through development of commercial
office/ institutional properties in a modern, energy efficient and sustainable manner at Noida, Kaushambi, Panchkula.
Projects for construction of additional built spaces are also undertaken in HUDCO's existing Regional Offices at Kolkata,
Jammu and Ahmedabad to fruitfully make use of the unused available FAR. Reconstruction of six HUDCO residential
flats at Asian Games Village, New Delhi has also been taken up to provide sustainable housing for its officers. With an
objective to provide a standardised, state of the art workspace environment to HUDCO employees across India, phased
upgradation of HUDCO offices in selected need-based locations is being taken up starting with the ongoing renovation
of office space at HUDCO House, Lodhi Road, New Delhi.

The organization continues its association with the National Association of Students of Architecture (NASA) to host
the HUDCO NASA Design Trophy that challenges young minds to give innovative solutions to complex contemporary
challenges in Indian cities. The Theme for HUDCO NASA Design Trophy 2026 is “Design Solutions for Future Ready
Cities in India.”

6. FINANCIAL REVIEW

(i)    Accounting Policies

There has been updation in the accounting policy during the quarter/ year ended period. However, there is no
material financial impact on net profit/loss, total comprehensive income or any other relevant financial item(s) due
to updation in accounting policies.

(ii)    Income from Operations and Profitability

Your Company has reported Total Income for the Financial Year 2025-26 at Rs.13327.13 Crore (Previous Year
Rs.10348.38 Crore) inclusive of Other Income of Rs.176.73 Crore (Previous Year Rs.37.09 Crore). While the
Profit before Tax (PBT) for the Financial Year was Rs. 3,221.44 Crore (Previous Year Rs.3,636.66 Crore) and
Profit after Tax (PAT) was Rs.4,034.37 Crore (Previous Year Rs.2,709.14 Crore). Total Comprehensive Income for
the Financial Year was reported as Rs.3,477.15 Crore (Previous Year Rs.2,544.34 Crore).

(iii)    Non-Performing Assets

Your Company continues to demonstrate robust asset quality, reflected in its consistently low NPA levels. This is
supported by specialized teams dedicated to recovery, project oversight, and stressed asset management. The
loan portfolio is subject to continuous monitoring, allowing the Company to track repayment behaviour, identify
potential stress at an early stage, and take timely corrective actions wherever necessary.

Instances of delay or default are addressed through a structured and time-bound approach. The Company
engages with borrowers through various channels such as written communication and meetings to facilitate
account regularization. Simultaneously, regulatory requirements like SMA classification and reporting to RBI,
along with disclosures to credit information systems such as CRILC and CIBIL, are adhered to diligently.

HUDCO remains proactive in resolving stressed assets by leveraging multiple avenues, including One-Time
Settlements (OTS), legal proceedings, actions under the Insolvency and Bankruptcy Code (IBC) 2016, technical
write-offs, and case-specific default resolution packages. The Stressed Asset Management Department,
in coordination with the Corporate Law Wing, regularly undertakes joint reviews with each Regional Office to
assess NPAs, track the legal status of recovery proceedings, and explore resolution options through available
mechanisms. The status and progress of these efforts are periodically placed before the Committee for Review of
NPAs (a Board-level committee) and the Board of Directors.

As a result of diligent efforts and strategic approach in managing Stressed Assets portfolio, at the end of the Financial
Year ended 31^st March, 2026, your Company reported Gross NPA of Rs.1,673.84 Crore, which constitutes 1.04%
of total loan portfolio. The Net NPA as on 31^st March, 2026 stood at Rs.85.35 Crore, constituting 0.05% to net
loan outstanding, as against MoU target of 0.35%. During the year 2025-26, an amount of Rs.402.96 Crore was
recovered from the accounts (Project loans) which were in NPA as on 31.03.2025 including complete resolution of
twenty NPA Accounts with Principal Outstanding of Rs.425.88 Crore through IBC/ OTS/ DRT/ Technical Write-Off.
A total impairment provision of Rs.1,621.21 Crore as per the ECL Approach, including Rs.1,588.49 Crore towards
the provision against NPA (Stage - III) loans was made by the Company, exhibiting adequate provision coverage
ratio of 94.90%.

(iv)    Resource Mobilization

The Company continued to pursue a prudent and diversified resource mobilization strategy during Financial Year
2025-26, with a focus on ensuring adequate availability of funds, optimizing borrowing costs, maintaining liquidity,
and supporting its growing lending operations. Leveraging its strong credit profile and established presence in
domestic and international debt markets, the Company successfully mobilized aggregate resources amounting
to Rs.67,503.22 Crore during the year through a mix of bonds, term loans, short-term borrowings and external
commercial borrowings (ECBs).

The resource mobilization during the year comprised Rs.10,396.12 Crore through issuance of unsecured taxable
bonds, Rs.49,184.69 Crore through rupee term loans from banks, Rs.2,503.72 Crore through short-term bank
borrowings and Rs.5,418.69 Crore through the ECB route. The Company continued to diversify its funding sources

across instruments, maturities and markets, thereby strengthening its funding resilience and enhancing financial
flexibility.

The borrowing programme was aligned with the Company's Asset Liability Management (ALM) framework and
was undertaken after due consideration of liquidity requirements, maturity profiles, interest rate outlook and
prevailing market conditions. The Company maintained a balanced liability structure and adopted proactive
treasury management practices to optimize the overall cost of funds.

The Company continued to follow a prudent liquidity management policy whereby short-term borrowings are
periodically refinanced with longer-tenor resources, taking into account market opportunities, liquidity position and
business requirements. Surplus funds, wherever available, were deployed in accordance with Board-approved
investment policies with the objective of preserving capital, maintaining liquidity and reducing negative carry.

The Company remained fully compliant with the Liquidity Coverage Ratio (LCR) requirements prescribed by the
Reserve Bank of India and maintained adequate High Quality Liquid Assets (HQLA) to withstand potential liquidity
stress scenarios. The robust liquidity framework and continuous monitoring mechanisms enabled the Company to
maintain a strong liquidity position throughout the year.

As on 31^st March, 2026, the Company's outstanding borrowings stood at Rs.1,41,389.61 Crore, comprising long
and medium-term borrowings of Rs.1,38,885.89 Crore, including foreign currency borrowings of Rs.12,475.64
Crore, and short-term borrowings of Rs.2,503.72 Crore. The Company's diversified liability profile, coupled with
prudent risk management practices, continues to provide a strong foundation for supporting its business growth
while maintaining financial stability.

The composition of outstanding borrowings as on 31^st March, 2026 is as under:

During the year, HUDCO achieved a significant milestone by becoming an eligible issuer of Capital Gain Tax
Exemption Bonds under Section 54EC of the Income Tax Act, 1961 (corresponding section 85 of the Income Tax
Act, 2025) pursuant to Notification No. S.O. 1644(E) dated 7^th April, 2025 issued by the CBDT, Ministry of Finance,
Government of India. Subsequently, the Company successfully launched its maiden 54EC Capital Gain Bond
issue through the private placement route. The Bonds were issued with a tenor of five years and carried a coupon
rate of 5.25% per annum. The issue received a positive response from investors, enabling the Company to
mobilize over Rs.121 Crore within eleven months of launch, exceeding the initial issue size of Rs.100 Crore. The
issuance has broadened HUDCO's resource mobilization avenues, diversified its investor base and strengthened
its capacity to raise long-term funds for financing infrastructure and housing projects in line with its developmental
mandate.

During the year, the Company successfully raised Rs.1,442 Crore through the issuance of its maiden Tier-I
Perpetual Debt Instrument. The proceeds have strengthened the Company's Tier-I capital base, enhanced its
capital adequacy position and asset-liability management profile, and provided additional headroom for supporting
future business growth while maintaining prudent leverage levels. The outstanding borrowings-to-net worth ratio
stood at 6.43 times (5.52 times excluding GoI serviced bonds) as on 31^st March, 2026 as against 5.97 times
(4.86 times excluding Government of India serviced bonds) as on 31^st March, 2025, reflecting the growth in the
Company's resource base in line with the expansion of its lending operations.

(v) Cost of Borrowings

The Company continued to focus on optimizing its cost of funds through a judicious mix of borrowing instruments,
diversification of funding sources and proactive treasury management. During Financial Year 2025-26, the
weighted average cost of resources mobilized during the year stood at 6.56% per annum. The weighted average
cost of outstanding borrowings as on 31^st March, 2026 declined to 7.17% per annum as compared to 7.44% per
annum as on 31^st March, 2025, reflecting the Company's sustained efforts towards efficient liability management
and cost optimization.

During the year, the weighted average incremental cost of borrowings through taxable bonds/debentures was
8.20 basis points lower than the prevailing Reuters benchmark yield of AAA-rated CPSE bonds of comparable
tenor at the respective times of issuance. This enabled the Company to achieve the “Excellent” category target
under the Memorandum of Understanding (MoU) parameters relating to cost of borrowings.

As part of its strategy to diversify funding sources and optimize borrowing costs, the Company successfully
accessed international markets and raised External Commercial Borrowings (ECBs) aggregating JPY 92 billion
during Financial Year 2025-26. These borrowings were raised at an overall average all-in cost of 5.76% per
annum, including hedging costs, thereby contributing to further diversification of the Company's liability profile.

The Company continued to maintain a prudent foreign currency risk management framework. The ECB exposures
were appropriately hedged through derivative instruments, including option-based structures, in accordance

with the Company's approved risk management policies. Further, hedge accounting under Ind AS 109 has been
adopted for ECB exposures from the inception of the respective borrowings, thereby ensuring alignment of
accounting treatment with the underlying risk management objectives.

The Company's ability to maintain a competitive cost of funds through effective treasury operations, disciplined
liability management and diversified market access enabled it to continue providing financial assistance for
housing and urban infrastructure projects across the country on competitive terms, while maintaining financial
sustainability and supporting long-term business growth.

(vi) Domestic and International Credit Ratings

The Company continued to enjoy strong credit ratings from leading domestic and international credit rating
agencies during Financial Year 2025-26, reflecting its established market position, prudent financial management
and sustained operational performance. The ratings assigned to the Company support its ability to access
diverse funding sources across domestic and international markets and reinforce stakeholder confidence in its
creditworthiness.

Domestic and International Credit Ratings

The international ratings are aligned with the sovereign rating framework applicable to Indian issuers and reaffirm
the Company's standing in international financial markets.

The continued retention of the highest domestic credit ratings and strong investment-grade international ratings
enhances the Company's ability to mobilize resources efficiently across a diversified range of funding sources. The
ratings support wider investor participation, facilitate competitive pricing of borrowings and strengthen financial
flexibility, thereby enabling the Company to effectively support its business growth and long-term financing
objectives.

(vii) Debt Securities and Investor Servicing

Issuance and Dematerialization of Bonds/Debentures

During the Financial Year 2025-26, the Company issued Unsecured, Taxable Bonds/ Debentures exclusively in
dematerialized form. Consequently, all Taxable Bonds/Debentures issued by the Company and outstanding as on
31^st March 2026 are held in dematerialized form only.

The Company has established necessary arrangements with the National Securities Depository Limited (NSDL)
and Central Depository Services (India) Limited (CDSL) for issuance and holding of Bonds/Debentures in
dematerialized form. The Company has also appointed Registrar and Transfer Agent(s) to ensure seamless
electronic connectivity with NSDL/CDSL and to facilitate efficient maintenance and servicing of investor accounts.

Investors may hold, transfer, and transact in the Bonds/Debentures in dematerialized form in accordance with
the provisions of the Depositories Act, 1996, as amended from time to time, and the rules, regulations, and bye¬
laws framed thereunder. Such securities are eligible for trading on recognized stock exchanges and are cleared
and settled through the mechanism of clearing corporations and depositories, in accordance with the guidelines
issued by the Securities and Exchange Board of India (SEBI) and the respective stock exchanges from time to
time.

Redemption of Debt Securities and Repayment of Loans

The Directors are pleased to report that during the year under review, the Company successfully redeemed
Bonds/Debentures and discharged its other debt obligations aggregating to Rs.18,781.85 Crore in a timely and
efficient manner, without any instance of delay or default in debt servicing.

The repayments during the year comprised redemption of Bonds/Debentures amounting to Rs.5,487.68 Crore,
repayment of Term Loans and Short-Term Loans from banks and financial institutions aggregating to Rs.13,282.98
Crore, and repayment of foreign currency loans availed from multilateral agencies amounting to Rs.11.19 Crore.

The Company continues to maintain an impeccable track record of timely servicing of all its debt obligations and
has not defaulted in repayment of principal or payment of interest on any of its borrowings.

During the ensuing Financial Year, the Company is scheduled to meet redemption and repayment obligations
towards Bonds and other long-term borrowings amounting to approximately Rs.16,914.70 Crore. The Directors
are confident that the Company's internal accruals and cash flows will be adequate to meet these obligations as
and when they fall due.

(viii) Unclaimed Principal and Interest on Bonds

As on 31^st March 2026, an aggregate amount of Rs.21,57,37,258/-, comprising principal of Rs.9,09,03,000/- and
interest of Rs.12,48,34,258/-, pertaining to 4,106 bondholders, remained unclaimed as the same had not been
claimed by the respective bondholders.

The Company has been making continuous efforts to facilitate settlement of unclaimed amounts by issuing
periodic communications through email, letters and other appropriate modes, requesting investors to complete
requisite formalities and submit necessary documents for claiming their dues.

The details of unclaimed principal and interest outstanding are disclosed in the accompanying table:

Transfer to Investor Education and Protection Fund (IEPF)

In accordance with the provisions of the SEBI (Listing Obligations and Disclosure Requirements) (Fifth Amendment)
Regulations, 2021, read with Section 125 of the Companies Act, 2013, any principal and/or interest remaining
unclaimed for a period of seven years from the date of payment is required to be transferred to the Investor
Education and Protection Fund (IEPF).

During the Financial Year 2025-26, the Company transferred an amount of Rs.95,27,768/- to the IEPF in respect
of unclaimed amounts pertaining to Bonds/ Debentures, in compliance with the applicable regulatory provisions.

Investor Servicing and Commitment

The Company remains committed to maintaining high standards of investor servicing and continues to take all
necessary steps to ensure timely payment of interest and redemption proceeds. The Company also actively
engages with investors to facilitate resolution of pending claims and to safeguard investor interests in accordance
with applicable regulatory requirements.

(ix) Unclaimed amount under HUDCO Public Deposit Scheme

HUDCO had discontinued acceptance and renewal of deposits under the HUDCO Public Deposit Scheme with
effect from July 1, 2019. Accordingly, no fresh deposits have been accepted or renewed under the Scheme
thereafter.

As on March 31,2026, there were no outstanding public deposits under the Scheme, except for certain unclaimed
deposits. During Financial Year 2025-26, an amount of Rs.1,016 representing deposits remaining unclaimed for
more than seven years from the date of maturity, was transferred to the Investor Education and Protection Fund
(IEPF) in compliance with the provisions of the Companies Act, 2013 and the rules framed thereunder.

The aggregate amount of unclaimed deposits outstanding as on March 31, 2026 stood at Rs.1.82 Lakh (inclusive
of principal and interest), relating to three depositors.

(x) Deployment of Resources at the close of the year

As on March 31, 2026, the total resources of the Company stood at Rs.1,66,839.79 Crore. These comprised Equity
Share Capital of Rs.2,001.90 Crore, Reserves & Surplus of Rs.18,533.30 Crore, Tier-I Perpetual Debt Instruments of
Rs.1,442 Crore, borrowings of Rs.1,41,677 Crore from various sources, including Financial Institutions, Commercial
Banks, Multilateral Agencies and domestic debt markets, and Other Liabilities & Provisions of Rs.3,185.59 Crore.

The resources were deployed mainly in Loans & Advances amounting to Rs.1,60,547.15 Crore. The balance resources
were deployed in Investments of Rs.2,228.66 Crore, Cash & Bank Balances of Rs.226.11 Crore, Fixed Assets (net) of
Rs.111.04 Crore, Deferred Tax Assets (Net) of Rs.448.08 Crore, and Other Assets of Rs.3,278.78 Crore.

The resource deployment reflects the Company's emphasis on financing its business operations while ensuring
adequate liquidity and maintaining a sound financial position.

7. RISK MANAGEMENT IN HUDCO

In compliance with the directions given by the Reserve Bank of India (RBI), HUDCO has put in place Comprehensive
Risk Management Policy and Risk Register cum Early Warning Signals through which it reviews and assesses significant
risks on a regular basis to ensure that there is a robust system of risk control and mitigation. Major risks identified for
your Company, being in lending operations, are credit risk, operational risk, liquidity risk, market risk, interest rate risk
and foreign currency risk etc. The Company has also put in place Internal Capital Adequacy Assessment Process
(ICAAP) policy, through which it identifies, assesses, and manages risks that could impact its business operations,
financial position, and capital adequacy.

In compliance with the SEBI (LODR) Regulations, 2015, your Company has in place a Board Level Committee i.e.
'Risk Management Committee' (RMC). The Chairperson of RMC is a member of the Board of Directors. The RMC
ensures that risks are effectively managed and aligned with the organisation's objectives. The Committee also ensures
the development and oversight of the organisation's policy and framework and provides governance for effective Risk
Management. The RMC reviews various recommendations of the two sub-committees namely: -

•    Assets & Liabilities Committee (ALCO); and

•    Credit & Operational Risk Management Sub-Committee (CORMSC)

Assets and Liabilities Committee (ALCO) reviews the market risk & liquidity risk and ensures management of
Assets and Liabilities mismatches through liquidity gap analysis, interest rate sensitivity analysis. The Assets Liabilities
mismatch, if any, are being managed, through the committed bank lines, within the permissible limits. During the year,
16 meetings of ALCO were held.

Credit & Operational Risk Management Sub Committee (CORMSC): The CORMSC periodically monitors credit and
operational risks in the Company. The sub-committee oversees and ensures that the credit policies are put in place and
monitors the credit risk by reviewing asset quality & asset classification as well as reviews the migration of loan assets.

The sub-committee also monitors and ensures mitigation of internal and external operational risks including Information
Technology & Cyber Security risk, Employee Risk, Compliance Risk, Fraud Risk, Legal Risk, Reputational Risk, etc.
This is achieved by strengthening internal control systems, establishing policies & procedures, and providing adequate
training to employees. During the year, five meetings of CORMSC were held.

With the prudent policies and professional approach of the management, HUDCO has been successful in mitigating
various risks, briefly described as under: -

Credit Risk - Your Company's core business is lending, which exposes it to Credit risk. Credit risk is the inherent risk in
the financing industry and involves the risk of loss, arising from the diminution in credit quality of a borrower and the risk
that the borrower will default on contractual repayments under a lending arrangement. To manage credit risks associated
with business, your Company is adhering to RBI mandated prudential norms, ensuring portfolio diversification, has put

in place a robust credit appraisal mechanism containing comprehensive appraisal techniques/ guidelines and conducts
regular monitoring etc. to ensure timely repayments of principal & interest amount.

Operational Risk - Operational risks refer to potential losses arising from inadequate or failed internal processes, people,
and systems or from external events. Your Company has established a robust reporting and monitoring framework to
manage operational risks arising from both internal and external factors, including Information Technology and Cyber
Security Risk, Employee Risk, Compliance Risk, Fraud Risk, Legal Risk, and Reputational Risk, etc. The Company
has put in place a comprehensive Risk Register through which all operational risks are identified, measured and
categorised as high, moderate or low risk category and regularly reported to Credit and Operational Risk Management
Sub- Committee, which is a functional-level Committee to review, monitor and manage operational risks.

Foreign Currency Risk - Foreign currency exchange risk involves exchange rate movements among currencies that
may adversely impact the value of foreign currency denominated assets, liabilities and off-balance sheet arrangements.
Your Company has a Foreign Currency Risk Management Policy for mitigation of risks associated with foreign currency
fluctuations. To cover the risks associated with exchange rate movement, your Company has entered into hedging
transactions. As on 31^st March, 2026, the total foreign currency liabilities are USD 206.25 million (INR 1942.93 Crore)
and JPY 216 billion (INR 12694.46 Crore) and 99.71% of the foreign currency exchange rate risk is covered through
hedging instruments.

Liquidity Risk - Liquidity Risk is the risk that a Company may not be able to raise funds, meet its financial obligation
due to an asset liability mismatch or interest rate fluctuation or lack of sufficient cash. For management of liquidity risk,
your Company has effective Asset Liability Management System. The liquidity risk is being monitored with the help of
liquidity gap analysis. Further, the funds are mobilized at competitive rates through various strategies viz. bonds, term
loans, ECB, etc., and the mismatch in the assets and liabilities, if any, are managed through committed bank lines. In
order to mitigate the liquidity risk, a dynamic mix of strategies including forward looking resource mobilisation based on
project disbursements and maturing obligations has been put in place.

Environment, Social and Governance (ESG) Risks - ESG risks emanate from environmental, social and governance
factors that have an impact on the operations, financial performance and management of Company. Owing to the
rising climate concerns & impetus of Governments in respective economies across the globe, ESG risks have attained
great significance. In order to positively impact the environment, customers, employees, and the community at large,
your company has Board approved Environment, Social & Governance (ESG) Policy framework, which is in line with
HUDCO's Vision and Mission statements that recognize the importance of sustainable development and responsible
corporate citizenship. The ESG Policy framework articulates the Company's commitment to ESG and long-term value
creation for internal and external stakeholders including customers, employees, investors, regulators, business partners
and community members. Your Company has been rated by various rating agencies with “Adequate” rating grade.

8.    JOINT VENTURE, ASSOCIATE AND SUBSIDIARY COMPANY

As on 31^st March, 2026, HUDCO has three Joint Ventures/ Associates, namely, Pragati Social Infrastructure &
Development Limited (PSIDL), Shristi Urban Infrastructure Development Limited (SUIDL), Signa Infrastructure India
Limited (SIIL) and Associate namely Ind Bank Housing Limited (IBHL). Further HUDCO does not have any subsidiary.

HUDCO had invested Rs.2.14 Crore in the Joint Venture Companies {PSIDL - Rs.0.13 Crore (26%), SUIDL- Rs.2.00
Crore (40%) and SIIL- Rs.0.01 Crore (26%)}. HUDCO has decided to exit from joint venture companies by invoking
the exit clauses, as the performance of these joint ventures was not found to be satisfactory. The Company is in the
process of exiting from these Joint Ventures/ Associates, for which necessary steps are being taken. The investment in
respect of PSIDL and SIIL is being shown as Re.1/- in HUDCO books while accounts of SUIDL are being consolidated
with HUDCO accounts.

Presently, HUDCO is valuing its stake in IBHL at Re. 1/- only, since there is very limited trading in the stock market.
Reserve Bank of India vide letter dated 10^th October, 2023 has informed that Certificate of Registration (CoR) granted
by National Housing Bank to IBHL has been cancelled vide order dated 21^st September, 2023 hence, IBHL is no longer
an HFC. In the case of IBHL, an associate company, HUDCO has investment of Rs.2.50 Crore which constitutes 25%
of paid-up capital in IBHL.

9.    INTERNAL FINANCIAL CONTROL POLICY AND INTERNAL AUDIT

Your Company maintains an effective Internal Financial Control (IFC) system designed to ensure the orderly and efficient
conduct of business operations. The framework encompasses strict adherence to established policies and procedures,
safeguarding of Company assets, prevention and detection of frauds and errors, accuracy and completeness of
accounting records, and timely preparation of reliable financial information aligned with the scale of operations.

Evaluation of adequacy and effectiveness of Internal financial control is carried out every year and placed before Audit
committee and directions by Audit committee are duly implemented.

The IFC system framework establishes well-defined Risk Control Matrices and Process Flow Charts that depict the
process to initiate, authorize, process, record and report transaction, and prevent or detect errors. Risk Control Matrices
are structured around a comprehensive risk and control framework covering all major business processes. Internal Audit
periodically conducts control testing of these matrices to validate their effectiveness. Additionally, the process flowcharts
enhance transparency and strengthen the overall control environment

Internal Audit

Internal Audit plays a pivotal role in ensuring adherence to the Company's policies, guidelines, and procedures. The
Internal Audit Department is adequately staffed and has adopted a Risk-Based Internal Audit (RBIA) framework in line
with the Reserve Bank of India's guidelines on RBIA systems, thereby strengthening and streamlining all auditable
activities.

During the year under review, RBIA was conducted at the Corporate Office as well as across all Regional Offices.
Significant audit observations were presented to the Audit Committee, and appropriate actions were taken in accordance
with the Committee's directions.

10.    INFORMATION TECHNOLOGY

HUDCO continues to leverage its ERP framework to institutionalize seamless operational workflows across core
functions, including lending, treasury, procurement, and human capital management. The ERP system ensures data
integrity, enhances real-time reporting accuracy, and optimizes resource allocation.

Parallelly, the Corporation is actively integrating AI to its digital ecosystem for more efficiency. This includes the
deployment of intelligent Chatbots for internal and external stakeholder engagement, Predictive Monitoring for
infrastructure resilience, and advanced Cyber-Threat Detection systems. Furthermore, the Corporation is in the process
of implementing AI-powered solutions to streamline executive governance and enhance decision-making efficiency.

11.    HUMAN SETTLEMENT MANAGEMENT INSTITUTE

Human Settlement Management Institute (HSMI) of HUDCO is involved in both research and capacity-building activities
in the urban sector. HSMI provides a forum for interaction for administrators, professionals, researchers, and others
engaged with the issues of human settlement development.

Training Activities

Since its inception in 1985, HUDCO's HSMI has so far benefited 60463 officials through 1890 training programmes
and continues to provide capacity-building support for professionals. This is inclusive of the training courses conducted
under the Indian Technical and Economic Cooperation (ITEC) programme of the Ministry of External Affairs, Government
of India. Under the ITEC programme, 1443 overseas participants have benefited through 7 e-ITEC and 61 training
courses.

Capacity Building and Training conducted in Financial Year 2025-26:

In FY 2025-26, HUDCO's HSMI has provided training to 3395 officials through 55 programmes, including 5 courses

under the ITEC programme sponsored by the Ministry of External Affairs, Government of India, benefiting 113 overseas
participants.

For HUDCO and other CPSEs officers

In the Financial Year 2025-26, HUDCO's HSMI conducted 11 Webinars, 8 Hybrid, and 31 In-person training programmes,
imparting training to 3282 participants, including officers from HUDCO as well as other CPSEs.

Webinars

The webinars were conducted on relevant themes like Corporate vision, Finance for Non-finance, PM Awas Yojana,
Ethical Conduct and Vigilance, HR policy, RBI Regulatory Compliance, Consultancy Services, Asset Monetisation and
Property Development, Resource Mobilisation, Introduction to ERP module, e-Office system and Capacity Building
Initiatives.

Hybrid Training Programme

The Hybrid training programmes were conducted on regulatory and policy frameworks like KYC & CKYC, Smart
Technologies and Controls in Energy-Efficient Buildings, Procurement through GeM, Insolvency and Bankruptcy Code,
NCLT Proceedings and SARFAESI Act 2002, Circular Economy and C&D Waste Management, InvITs & Financial
Modelling and Urban Transport. These Training programmes were conducted for officers from HUDCO Corporate Office
and Regional Offices across the country. The Hybrid training programmes were also attended by officers from other
CPSEs such as Telecommunications Consultants India Limited (TCIL), Bank of Maharashtra (BoM), National Buildings
Construction Corporation Limited (NBCC), National Bank for Financing Infrastructure and Development (NaBFID),
National Highways and Infrastructure Development Corporation Limited (NHIDCL) and Sagarmala Finance Corporation
Limited (SFCL).

In-person Training Programmes

A 1-week Induction Programme was organised to familiarise newly recruited lateral entry officers with the vision and
operations of HUDCO. Besides this, 6 offline training Programmes were conducted on themes like Motivation and Team
Building, Cyber Security, Managing Work Life Balance, Use of Drone Technology in Urban Planning, Planning to Progress:
MS Project 2021, Project Finance and PPP. These Training programmes were conducted for HUDCO officers from the
Corporate Office and Regional Offices across the country. The In-person training programmes were also attended by
officers from other CPSEs such as Telecommunications Consultants India Limited (TCIL), Bank of Maharashtra (BoM),
National Buildings Construction Corporation Limited (NBCC), Indian Renewable Energy Development Agency Limited
(IREDA), India Infrastructure Finance Company Limited (IIFCL), North Eastern Development Finance Corporation
Limited (NEDFi), Mahagenco Renewable Energy Limited (MREL), Delhi Metro Rail Corporation Limited (DMRC), Rural
Electrification Corporation (REC) and Madhya Pradesh Consultancy Organisation Limited (MPCON).

Apart from the above 7 training programmes, HSMI also conducted 2 programmes of 3 days duration under the Rashtriya
Karmayogi Jan Seva Training Programme for Master Trainers of 13 Organisations [Housing and Urban Development
Corporation Limited (HUDCO), National Capital Region Planning Board (NCRPB), National Capital Region Transport
Corporation (NCRTC), Directorate of Estates (DoE), National Institute of Urban Affairs (NIUA), Building Materials and
Technology Promotion Council (BMTPC), Delhi Urban Arts Commission (DUAC), Rajghat Samadhi Committee (RSC),
Town & Country Planning Organisation (TCPO), Hindustan Prefab Limited (HPL), Central Government Employees
Welfare Housing Organisation (CGEWHO), Land and Development Office (L&DO) and Directorate of Printing (DoP)]
under Ministry of Housing and Urban Affairs (MoHUA) and 22 training programmes for employees of HUDCO Corporate
Office and Regional Offices across the Country.

For International Participants under ITEC

HUDCO's HSMI also conducted 5 training courses under the ITEC programme sponsored by the Ministry of External
Affairs, Government of India, on Making Cities Sustainable, Leveraging Resilience for Future Proofing our Cities,
Housing the Urban Poor: Policy, Planning and Implementation- the Indian Experience, Towards Sustainable Urban
Mobility in Developing Urban Context and Leadership Skills for Women.

The ITEC courses were conducted for 113 overseas professionals from 47 countries. The courses also showcased
various Government of India programmes, projects, and initiatives implemented pan-India in areas such as Sustainable
Urban Mobility, Social Housing, Sustainable Urban Development practices and Empowerment of Women.

Publications

HUDCO's HSMI comes out with a bi-annual ISSN magazine “Shelter” on themes relevant to the housing and urban
development sector. Shelter features a wide range of articles that provide in-depth insights into creating sustainable,
inclusive, and resilient urban environments.

The April 2025 issue of Shelter, unveiled on HUDCO's foundation day by Shri Tokhan Sahu, the Hon'ble Minister of
State, focused on transforming housing and urban development to achieve the goal of Viksit Bharat by 2047. 'Urban
Crisis Response' was the theme of the October 2025 issue of Shelter, which coincided with the theme of World Habitat
Day. The issue received an overwhelming response and is a compilation of theme papers, policy reviews, and case
studies by eminent scholars in the urban sector.

Research & Development activities

The Company had formulated a Research & Development (R&D) policy in line with the guidelines issued by the
Department of Public Enterprises vide Office Memorandum No. 3(9)/ 2010-DPE (MoU) dated 20.09.2011. During the
year, to utilise the unspent balance available under the R&D budget head, the Board of Directors of HUDCO approved the
proposal of the Technical Assistance scheme for Project Formulation, Capacity Building and Research & Development
activities for Government Agencies and ULBs, etc., with an initial corpus of Rs.5.00 crore. The Board also approved the
Revised Guidelines for setting up HUDCO Chairs at various institutions in the country.

12.    INTERNATIONAL COOPERATION AND GLOBAL ENGAGEMENT

During the year, HUDCO further strengthened its global engagements to promote knowledge exchange, institutional
capacity-building and innovative financing for sustainable urban development. As part of MoU signed between HUDCO
and the Institute for Housing and Urban Development Studies (IHS), Erasmus University Rotterdam, the Netherlands,
an Executive Course on “Affordable Housing under PMAY-U 2.0” was organised at IHS, jointly co-sponsored by the
Ministry of Housing & Urban Affairs (MoHUA) and HUDCO for senior functionaries of state governments involved in
the implantation of Pradhan Mantri Awas Yojana-Urban (PMAY-U), Urban Local Bodies and various other stakeholders.
Further, HUDCO in collaboration with UN-Habitat, jointly organised a national stakeholder consultation on “UN-Habitat's
Strategic Plan 2026-2029” and information on the vision and thematic focus of the 13^th World Urban Forum (WUF13),
scheduled for 17-22 May 2026.

13.    HUMAN RESOURCES

At HUDCO, we firmly believe that our success is driven by our people - our most valuable asset and a key differentiator
in an increasingly competitive environment. This belief continues to guide our human capital strategy, with sustained
focus on employee development, capability building, and organizational growth.

We offer competitive compensation, comprehensive benefits including medical coverage, superannuation schemes with
post-retirement medical support, and a balanced mix of monetary and non-monetary rewards and recognition. In line
with our commitment to digital transformation, advanced systems such as HRMS and e-Office have been implemented
to enhance operational efficiency and enrich employee experience.

Employee development and engagement remain top priorities. We nominate employees to various training programmes
and hold various Leadership and Development initiatives. The company conducts diverse employee engagement
including sports, yoga initiatives to foster team building, growth and retention.

As of 31^st March, 2026, our workforce stands at 585 employees, including 170 women (29.1% of total strength) which is
one of the best in diversity factor in peer group CPSEs, with representation across all hierarchical levels.

Succession Planning

To address superannuation-related separations and support our evolution into an Infrastructure Finance Company (IFC)
amid projected growth, steps have been initiated for proper succession planning.

HUDCO has established a comprehensive Succession Planning Policy to ensure operational and service continuity
in the event of departure of Key Managerial Personnel and Senior Management. The Policy facilitates the systematic,
long-term development of internal leadership talent, drawing from the managerial cadre to fill critical positions arising
from retirement, disability, death, or other unforeseen circumstances.

To address HUDCO's diverse techno-financial and operational portfolio, the Succession Planning Process encompasses
pivotal roles across targeted levels, in addition to leadership positions

14. VIGILANCE

Role of Vigilance Department

Corporate Vigilance Department (CVD) actively pursued
Preventive & Corrective Vigilance as per mandate of Central
Vigilance Commission (CVC) by conducting regular and
surprise inspections across various Regional Offices and
Departments. Further, based on inputs by CVD, updation of
operational guidelines of various functional departments has
been undertaken by the departments to promote transparency,
fairness and accountability in all operational areas.

In this regard, the following major activities are carried out:-

• Review of audit reports i.e. Internal, Statutory and C&AG
Reports regularly.

•    CTE type scrutiny of contracts undertaken and system improvements in tendering & contract management
implemented.

•    Field inspections of Regional Offices, HUDCO financed projects and scrutiny of APRs executives.

In compliance of CVC's directions for observing campaign period from 18^th August - 17^th November, 2025 (three months
period) as a precursor to Vigilance Awareness Week, 2025, on vigilance measures activities - (i) Disposal of pending
complaints (ii) Disposal of pending cases (iii) Capacity Building Programmes (iv) Asset Management (v) Digital Initiatives
as focus areas were also taken up in campaign mode. Vigilance Awareness Week was observed by the Corporation
from 27^th October to 2^nd November, 2025 in the Head Office as well as at all the Regional Offices. The programmes were
theme centric, declared by the CVC i.e. “Vigilance: Our Shared Responsibility”. (dd4idi - $<hi£| di^i f^^ejff)

15. OFFICIAL LANGUAGE

During the year, HUDCO undertook several initiatives to
promote the use of Hindi in official work. “Hindi Pakhwada”
commenced on September 14, 2025, with the celebration of
Hindi Diwas and the 5^th All India Official Language Conference
in Gandhinagar, Gujarat. Various competitions, workshops, and
seminars were organized at Head Office and Regional Offices.
Hon'ble Minister of State for Housing and Urban Affairs, Shri
Tokhan Sahu inspected the Head Office on 2^nd September,
2025, and appreciated HUDCO's efforts such as the Hindi
Library, Training lab, in-house magazines and exhibitions.

In addition to this the third Sub-committee for the parliamentary
Official Language Committee carried out Rajbhasha Inspection
at the Lucknow Regional Office, HUDCO on 19^th January, 2026
and awarded a certificate of “Excellence” to HUDCO.

During this year, the in-house magazine of HUDCO, Awaas Dhwani received first prize from NARAKAS Delhi Upakram-
2. Furthermore, through the joint efforts of the Department of Official Language, Ministry of Home Affairs, Government
of India and HUDCO, a book based on Artificial Intelligence was published; it was released on September 14, 2025, on
occasion of Hindi Diwas, by the Hon'ble Union Minister of Home Affairs and Cooperation, Shri Amit Shah. The CMD,
HUDCO was also present on this occasion. Additionally, HUDCO received the third “Rajbhasha Kirti Award” from Shri
Arjun Ram Meghwal, Hon'ble Minister of State, Ministry of Parliamentary Affairs, Government of India, for outstanding
performance in the implementation of the Official Language.

16. COMPLIANCES OF VARIOUS ACTS/ GUIDELINES

HUDCO has been complying with all the directives and guidelines issued by the Government of India regarding
reservation for SC/ST/OBC/PwD/ Ex-Servicemen/ EWS.

During the year under review, the Company complied with the provisions of all applicable labour laws, rules, regulations,
and guidelines. No penalty was imposed, nor any stricture passed, against the Company by any statutory authority
during the period.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013

An Internal Complaints Committee (ICC), headed by a senior woman officer, addresses sexual harassment complaints
under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Sexual
harassment constitutes misconduct under HUDCO's Conduct, Discipline and Appeal Rules. During the year, a meeting
of an Internal Complaints Committee was held on 12^th January, 2026.

No sexual harassment complaints were pending at the start of Financial Year 2025-26, received during the year, or
pending at year-end.

Disclosure under Maternity Benefit Act, 1961

During the year under review, the Company has complied with the provisions of Maternity Benefit Act, 1961 including
Maternity leave provisions, Salary and benefits and other related employee entitlements.

Public Grievance Redressal Mechanism of HUDCO

HUDCO, as a Public Sector Undertaking (PSU) under the Ministry of Housing and Urban Affairs (MoHUA), remains
steadfast in its commitment to maintaining a quick and responsive Public Grievance Redressal System.

The Public Grievance (PG) Cell of HUDCO serves as the nodal agency for the receipt, processing, and resolution
of grievances received through the CPGRAMS portal and PG official mail. PG Cell functions under the framework
and timelines laid down by the Ministry of Housing and Urban Affairs (MoHUA) and the Department of Administrative
Reforms and Public Grievances (DARPG), from time to time.

Operational Framework & Commitment:

In alignment with the principles of citizen-centric governance, the PG Cell ensures that every grievance is handled with
due diligence through the following actions:

Prompt Acknowledgment: Initial receipt/ Confirmation and categorization of grievances.

Time-Bound Resolution: Disposing of grievances including interim responses on a prescribed time-scale in strict
adherence to rules and recommendations laid down by ministry.

Strategic Redirection: Forwarding matters to the concerned functional departments/verticals for eliciting due response
including specialized/technical inputs for resolution of grievance.

Adherence to Guidelines: Operating strictly under the administrative guidelines of MoHUA by duly ensuring
accountability and transparency in service delivery.

During the Financial Year 2025-26, the PG Cell has maintained a high disposal rate in accordance with the MoHUA
benchmarks. There have been no instances of systemic non-compliance with the prescribed grievance redressal
protocols. No penalties, strictures or adverse remarks were passed or imposed on the company by any Authority during
the period under review.

Implementation of Micro, Small & Medium Enterprises (MSME) Policy

Implementation of Micro, Small & Medium Enterprises (MSME) Policy, the Government of India, Ministry of Micro,
Small & Medium Enterprises (MSME), has advised Central Ministry/ Department CPSEs that 25% of overall annual
procurement, be procured through MSEs, 4% of overall procurement through MSEs owned by SC/ST and 3% of
overall procurement from MSEs women entrepreneurs. During the Financial Year 2025-26, HUDCO has made total
procurement of Rs.33.0940 Crore.

In compliance of the Public Procurement Policy for Micro and Small Enterprises, issued by Government of India vide
Micro and Small Enterprise (MSEs) Order, 2012 dated 25^th March 2022, during the Financial Year 2025-26, HUDCO
has made procurement amounting to Rs.20.5868 Crore from MSEs, constituting 62.21% of its total annual procurement
inclusive of 4.50% from MSEs owned by SC/ST entrepreneurs amounting to Rs.1.4878 Crore and 9.91% from Women
Entrepreneurs constituting Rs.3.2803 Crore.

Right to Information Act

HUDCO, as a PSU under the Central Government, is a Public Authority under the RTI Act, 2025. As such Public
Authority, HUDCO is committed to maintain transparency in all spheres of its activities by proactively and suo-moto
disclosing vital information to the General Public in its official website in the spirit of the mandate u/s 4 of the RTI Act,

2005. Further, HUDCO is, has been and continues to be committed to provide the information to the Citizen of India
sought by them u/s 6 and 7 of the RTI Act within the statutorily prescribed time.

During the Financial Year 2025-26, there has been no instance of non-compliances by the Company. No penalties,
strictures or adverse remarks were passed or imposed on the company by any Statutory Authority during the period
under review.

Environmental, Social and Governance (ESG) and Sustainable Development

Although ESG has emerged as a formal framework in recent years, its core principles have long been embedded in
HUDCO's institutional ethos and development mandate. Since its inception, the Company has been committed to
financing housing and urban infrastructure such as water supply, sewerage, sanitation, environmental infrastructure
and, more recently, renewable energy and climate-resilient projects that promote inclusive growth, environmental
sustainability and good governance.

During the year, HUDCO continued to strengthen the implementation of its Environmental, Social and Governance
(ESG) framework, building upon the ESG Policy approved by the Board in the previous financial year. The Company
also launched its inaugural ESG Report released in September,2025, which articulated HUDCO's ESG vision and
governance framework, highlighting the Company's commitment to environmental sustainability, social responsibility
and governance excellence, while laying the foundation for its ESG journey.

The Company's lending portfolio continues to support projects that contribute to environmental sustainability and social
development, complemented by initiatives relating to resource conservation, waste management, employee well-being,
workplace safety, information security, cybersecurity, tree plantation and community development through its business
operations and CSR programmes. During the year, HUDCO also progressed on its sustainable finance initiatives,
including the introduction of Blue Loans and the KfW-supported Sustainable Finance Programme, further
strengthening its ability to mobilise long-term capital for sustainable development. Recognising the evolving landscape
of ESG and sustainable finance, the Company remains committed to continuously enhancing its ESG practices and
disclosures in line with its development mandate, stakeholder expectations and the evolving regulatory framework.

The Company's continued focus on strengthening its ESG framework and responsible business practices was reflected
in favourable ESG assessments during the year, including a 'Stable' ESG Rating by the National Stock Exchange
(NSE), an 'Adequate' ESG Rating by CRISIL, and a 'Low ESG Risk' rating by Sustainalytics.

Recognizing the evolving landscape of ESG and sustainable finance, HUDCO remains committed to continuously
strengthening its ESG practices and disclosures in line with its development mandate, stakeholder expectations and the
evolving regulatory framework.

17.    DIRECTORS' RESPONSIBILITY STATEMENT

As per requirement of section 134(5) of the Companies Act, 2013, your Directors' confirm that:

a)    in preparation of the Annual Accounts, the applicable Accounting Standards have been followed and no material
departures have been made from the same;

b)    such Accounting Policies have been selected 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 of the Company for the Financial Year under review;

c)    proper and sufficient care has been taken for the maintenance of adequate Accounting Records in accordance
with Provisions of Companies Act, 2013 for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;

d)    the Annual Accounts have been prepared on a 'going concern' basis;

e)    the Company has laid down Internal Financial Controls to be followed and such internal Financial Controls are
adequate and were operating effectively; and

f)    proper systems have been devised to ensure compliance with the provisions of all applicable laws and such
systems were adequate and operating effectively.

18.    MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussions & Analysis Report, stipulated in terms of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and DPE guidelines, for the year ended 31^st March, 2026, is annexed and forms part
of the Directors' Report.

19.    CORPORATE GOVERNANCE

The Corporate Governance Report as stipulated under Regulation 34(3) of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and DPE guidelines, together with a certificate from M/s VAP & Associates, Company
Secretaries in Practice, on compliance with the Corporate Governance norms is annexed and forms part of the Directors'
Report.

20.    BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT

In compliance with Regulation 34 of the SEBI (LODR) Regulations, 2015, Mehta & Mehta, Company Secretaries,
have conducted Reasonable Assurance Audit for Financial Year 2025-26. The Business Responsibility & Sustainability
Report and Reasonable Assurance Report on BRSR Core are annexed and forms part of the Directors' Report.

21.    DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under report, following changes took place in the composition of the Board of Directors:

Appointment of Part-time Official (Government) Director

Ministry of Housing and Urban Affairs (MoHUA), Government of India vide order dated 26^th August, 2025 has conveyed
the appointment of Shri Baldeo Purushartha, (DIN:07570116) I.A.S., then Joint Secretary (Infrastructure Policy &
Planning Division), Ministry of Finance, Gol as Part-time Official Director in place of Shri Solomon Arokiaraj on the Board
of HUDCO, with immediate effect until further orders. In compliance with the provisions of the Companies Act, 2013 and
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board, upon the recommendation of
Nomination & Remuneration Committee, appointed Shri Baldeo Purushartha, as Part-time Official Director (Additional
Director) (liable to retire by rotation) w.e.f. 8^th September, 2025 till the date of the next Annual General Meeting of
the Company i.e. 15^th September, 2025. Accordingly, Shri Baldeo Purushartha was ceased to be Part-time Official
(Government Nominee) Director on 15^th September, 2025.

Further, the Board, upon the recommendation of Nomination & Remuneration Committee, re-appointed Shri Baldeo
Purushartha, as Part-time Official Director (Additional Director) (liable to retire by rotation) w.e.f. 15^th September, 2025
till the date of the next Annual General Meeting of the Company.

Appointment of Part-time Non-official (Independent) Directors

MoHUA, GoI has, vide separate orders dated 7^th April, 2025, had re-appointed Smt. Sabitha Bojan (DIN: 09398364)
and appointed Shri Kantilal Chaturbhai Patel (DIN: 06610367) as Non-Official (Independent) Directors on the Board
of the Company for a period of one year from the date of issue of the orders or until further orders, whichever is
earlier. In compliance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, the Board, upon recommendation of Nomination & Remuneration Committee, re¬
appointed Smt. Sabitha Bojan and appointed Shri Kantilal Chaturbhai Patel as Non-Official (Independent) Directors
(Additional Directors) (not liable to retire by rotation) on the Board of the Company w.e.f. 28^th April, 2025.

Further, MoHUA, GoI, vide order dated 15^th May, 2025 had re-appointed Dr. Ravindra Kumar Ray (DIN: 09394495) as
Non-Official (Independent) Director on the Board of the Company for a period of one year from the date of issue of the
order or until further orders, whichever is earlier. In compliance with the provisions of the Companies Act, 2013 and SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board, upon recommendation of Nomination
& Remuneration Committee, re-appointed Dr. Ravindra Kumar Ray as Non-Official (Independent) Director (Additional
Director) (not liable to retire by rotation) on the Board of the Company w.e.f. 29^th May, 2025.

Accordingly, Smt. Sabitha Bojan, Shri Kantilal Chaturbhai Patel and Dr. Ravindra Kumar Ray were appointed as Non¬
Official (Independent) Directors on the Board of the Company in the 55^th Annual General Meeting of the Company held
on 15^th September, 2025.

Declarations of Independence by Non-official (Independent) Directors

During the year, pursuant to the provisions of Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the
SEBI (LODR) Regulations, 2015, all the Non-official (Independent) Directors, have given their declarations as to their
Independence. Based on the confirmation received from Directors, none of them are disqualified for being appointed/
re-appointed as directors in terms of Section 164 of the Companies Act, 2013 and other applicable laws, if any and are
not related to each other.

Rotation of Director in the ensuing Annual General meeting

As per requirements of Section 152 of the Companies Act, 2013 [including any statutory modification(s) or
re-enactment(s) thereof, for time being in force, read with the applicable rules, as amended] and Articles of Association

of the Company, Shri Daljeet Singh Khatri (DIN: 06630234), Director (Finance) being longest in office among the
Directors since his last appointment, is liable to retire by rotation and being eligible, offers himself for re-appointment at
the ensuing Annual General Meeting. The Board recommends re-appointment of Shri Daljeet Singh Khatri, as Director
(Finance) for approval of the members at the ensuing Annual General Meeting on the same terms and conditions as
approved by the President of India.

Cessation of Directors

Shri Solomon Arokiaraj ceased to be Part-time Official Director w.e.f. 02.09.2025 in accordance with Ministry of Housing
and Urban Affairs, Government of India Order dated 26.08.2025.

After closure of the Financial Year Cessation of Directors

Shri Kantilal Chaturbhai Patel, Smt. Sabitha Bojan with effect from 06.04.2026 and Dr. Ravindra Kumar Ray with effect
from 14.05.2026 ceased to be Part-time Non-official (Independent) Directors on completion of their term as per terms
and conditions of their appointment.

KEY MANAGERIAL PERSONNEL

The details of Key Managerial Personnel including changes occurred during the year and thereafter are as under:

The Board placed on the record its appreciation for the valuable services rendered by Shri Solomon Arokiaraj, as Part
time Official Director and Shri Kantilal Chaturbhai Patel, Smt. Sabitha Bojan and Dr. Ravindra Kumar Ray as Non-official
(Independent) Directors during their tenure with the Company and extends warm welcome to Shri Baldeo Purushartha
as Part-time Official Director on the Board of the Company.

22.    SECRETARIAL AUDITORS & AUDIT REPORT

In compliance of the provisions of Section 204 of the Companies Act, 2013, and Regulation 24A of SEBI (LODR)
Regulation 2015, VAP & Associates, Company Secretaries, Secretarial Auditors have conducted Secretarial Audit for
Financial Year 2025-26 and have in their report confirms that the Company has complied with the provisions of the
Act, Rules, Regulations and Guidelines applicable to the Company and there were no qualifications, reservations, or
adverse remarks except certain observations, which are self-explanatory. The Secretarial Audit Report is annexed and
forms part of the Directors' Report.

23.    AUDITORS & AUDITORS REPORT

As per section 139(5) of the Companies Act, 2013, the Statutory Auditors of your Company are appointed by Comptroller
and Auditor General of India (CAG). M/s S A R C & Associates, (Regd. no. DE2063), Chartered Accountants, New Delhi
has been appointed as Statutory Auditors of your Company for the Financial Year 2025-26 by the CAG.

M/s S A R C & Associates, Chartered Accountants (FRN-006085N), New Delhi, the Statutory Auditors had conducted
the audit of the Financial Statements (both Standalone and Consolidated) for the Financial Year 2025-26 and submitted
their report thereon. The comments of the Statutory Auditors on the Financial Statements along with Management reply
thereon are annexed and forms part of the report. Notes on Financial Statement referred to in the Auditors Report are
self-explanatory.

Comments of Comptroller and Auditor General of India (CAG)

CAG vide their letter dated 17^th July, 2026 has given 'NIL comments' on the Statutory Auditors report (both standalone
and consolidated) and audited financial statements (both standalone and consolidated) for the Financial Year 2025-26
under Section 143 of the Companies Act, 2013 and the same have been annexed and forms part of this report.

24. STATUTORY DISCLOSURES

(i) Corporate Social Responsibility Committee

In accordance with the provisions of the Companies Act 2013, the Board of Directors has constituted the Corporate
Social Responsibility Committee of the Board. As on 31^st March, 2026, the Committee comprised Shri M. Nagaraj,
Director (Corporate Planning) as Chairman of the Committee, Shri Sanjeet, Govt. Nominee Director and Smt. Sabitha
Bojan, Independent Director as members of the Committee.

The CSR Policy and other information on CSR is available on HUDCO Website at: http://www.hudco.org.in

The 'Annual Report on CSR activities for Financial Year 2025-26', indicating details of expenditure which was proposed
to be incurred and expenditure incurred on CSR activities during the Financial Year, along with the reasons for not
spending the entire allocated amount for CSR activities and other information, is attached to the Directors' report.

During the Financial Year 2025-26, an amount of Rs.57.90 Crore (including Rs.0.01 Crore surplus amount) was to be
incurred on CSR activities, of which 60% was required to be spent on CSR projects related to 'Health and Nutrition',
the annual theme identified by DPE for the year. During the Financial Year, the Company has spent a total of Rs.60.06
Crore (including administrative expenses of Rs.2.89 Crore and Rs.42.58 Crore for ongoing projects approved during
the Financial Year 2024-25, 2023-24 and 2022-23. Against the statutory obligation for Financial Year 2025-26, the
unspent amount i.e. Rs.32.75 Crore (including Rs.2.61 Crore disbursed to implementing agencies wherein submission
of utilization certificates is pending), was transferred to the 'Unspent CSR Account Financial Year 2025-26' opened with
a scheduled bank and shall be utilized in accordance with CSR Amendment Rules, 2021 under Companies Act, 2013
as in few proposals the implementing agencies are in process of completion of formalities for execution of the works like
finalization of tender etc. and in other cases the same is to be utilized based on the physical progress achieved in the
projects. Furthermore, out of the total amount spent during Financial Year 2025-26 as indicated above, Rs.39.49 Crore
(65.75% of total CSR Expenditure for Financial Year 2025-26) has been spent on the projects related to 'Health and
Nutrition', the annual theme identified by DPE for the year. Under its CSR activities, HUDCO has supported different
proposals as brought out hereunder:

•    Purchase of Medical Equipment for Cancer Institute (WIA), Adyar, Chennai, by Cancer Institute (WIA) (Non¬
Governmental Organisation)

•    Purchase of 5 Vehicles for Solid Waste Disposal by Tura Municipal Board

•    Procurement    of a Super sucker machine with one dump tank for sewer line cleaning by Nagar    Nigam,    Jaipur,

Greater

•    Procurement    of medical Equipment for AIIMS, Bibinagar, by AIIMS Bibinagar, Telangana

•    Procurement    of 14 Nos. of Auto Tippers for Door-to-Door garbage collection in District Bundi by Nagar Parishad-

Bundi

•    Provided Solar Power Pack to 20 Government Health Sub-Centres and Solar Water heaters to 36 Government
Resident Hostels in Mulugu District of Telangana

•    Project 'Vision Beyond Life: establishment of an Eye Bank' at AIIMS, Jammu by AIIMS, Jammu

•    Procurement of 10 numbers of Battery-Operated Vehicles (BOVs) with stretcher, by HUDCO Regional Office,
Bhubaneswar, for the SCB Medical College & Hospital, Cuttack, Odisha

•    Procurement and Installation of Medical Equipment at Community Health Centres (CHCs) at Addanki, Bapatla
District and Kanigiri, Prakasam District, Andhra Pradesh

•    Proposals for Strengthening Diagnostic and Surgical Support Services through Procurement of Digital Slide
Scanner and Advanced Hemodynamic Monitoring Platform at Gujarat Cancer and Research Institute (GCRI),
Ahmedabad

•    Establishment of 5 Haemodialysis Units and 1 RO plant (1000 Ltr/hr) by BSF Wives Welfare Association (BWWA)
in FHQ BSF Hospital-II, Tigri Camp, New Delhi. (Curtailed & Completed)

•    Project for Collection, Transportation, and Processing of MSW from NSG Campus - Manesar by “National Security
Guard” Manesar

•    Purchase of 2 Hearse (Shav Vahan) and 5 Cold Coffins in Agra, UP

•    Supply, Delivery and Fixing of CC Cameras at various locations to deter & monitor anti-social elements and also
monitoring garbage vulnerable points in Nellore Municipal Corporation, Andhra Pradesh

•    Purchase of three food distribution vehicles in centralized Mid-Day Meal Kitchen of Akshay Patra in Vrindavan,
Uttar Pradesh

•    Project for upgradation of Medical & Health Institution in Jaisalmer District (An aspirational district) of Rajasthan
by District Health Society Jaisalmer.

•    Installation of Open Gym Equipment at different parks across Delhi

•    Enhancement of Infrastructure and Equipment at the Comprehensive Resuscitation Training Centre (CRTC),
AIIMS, New Delhi

•    Construction of a covered walkway connecting the Speciality OP and Super Speciality Block for the transportation
of patients without obstructing road traffic at the General Hospital, Ernakulam

•    Procurement of FibroScan Equipment for The Institute of Kidney Diseases and Research Centre, Ahmedabad,
Gujarat

•    Distribution of Aids & Assistive devices to senior citizens and persons with disability

•    Purchase of Four Buses for the Vision Restoration Program by Parivaar Education Society

•    Procurement of 6 nos. of Shredder Machines and 8 nos. of Electric Garbage Collection Vehicles by HUDCO for
Solid Waste Management in Urban Local Bodies (ULBs) of Himachal Pradesh.

•    Construction of Health Care Park and Open Gym at Basti, Uttar Pradesh through Nagar Panchayat Babhnan
Bazar, Basti, Uttar Pradesh

•    Support for the educational mainstreaming of 84 underprovided marginalised children and youth of Manav Mandir
Gurukul.

•    Procurement of Surgical Microscope and Phacoemulsification Machine for Vivekananda Netralaya, Dehradun

•    Zero Waste Model for Asiad Village, Delhi
Non-Thematic Proposals:

•    Organised four Theatre Workshops with Children in the Slum Areas of Delhi, along with the One-day Theatre
Festival of plays made by the workshop participants, by the National School of Drama (NSD)

•    Project 'HUDCO Pehal - Steps Towards Inclusive Learning' - Developing educational and other supportive
infrastructure in Govt. and Govt. aided schools, schools for children with special needs and other child care
institutions

•    Strengthening Wildlife Rescue Infrastructure & Habitat Protection in Madhya Pradesh through Madhya Pradesh
Tiger Foundation Samiti

Further, out of the total amount spent during Financial Year 2025-26 as indicated above, an amount of Rs.4.72 Crore
was also transferred to 'Swachh Bharat Kosh', being the unspent CSR fund due to closure/curtailment of the ongoing
proposals of Financial Year 2022-23.

(ii)    Board and its Committees

The details as to the composition of the Board and its various Committees, scope & terms of reference, number of
meetings held and attended by directors/members during the year along with other particulars are annexed in the
Corporate Governance Report, forming part to this report.

(iii)    Particulars of Loans, Guarantee, or Investments

The necessary disclosures with respect to Loan made, Guarantee given or Securities provided by the Company in its
ordinary course of business have not been given, since, provisions of Section 186 of the Companies Act, 2013, are not
applicable to your Company, being an NBFC (IFC) registered with Reserve Bank of India. The detail with respect to
Investments made by the Company forms part of the Financial Statements for the Financial Year 2025-26.

During the Financial Year, all the existing Related Party Transactions were on an arm's length basis and were in the
ordinary course of business. There are no materially significant related party transaction(s) made by the Company,
which may have a conflict with the interest of the Company. Further, there was no contract or arrangement entered into
by the Company as listed under Section 188 of the Companies Act, 2013.

(iv)    Annual Return

Pursuant to Section 92(3) and Section 134(3)(a) of the Companies Act, 2013, the Annual Return as at 31^st March, 2026
available on the website of the Company on the following link:

https://hudco.org.in//Site/FormTemplete/frmTemp1PLargeTC1C P.aspx?MnId=463&ParentID=391

(v)    HUDCO being a Government Company, the provisions of Section 164(2) of the Act in respect of disqualification of
directors are not applicable to the Company in terms of notification no. G.S.R.463(E) dated 5^th June, 2015 issued
by Ministry of Corporate Affairs, Government of India.

(vi)    HUDCO, being a Government Company is exempted from the provisions of Section 197 of the Companies Act,
2013 and Rules made there under relating to managerial remuneration, hence, no disclosure is required to be
made.

(vii)    As per the statutory provisions, a listed Company is required to disclose in its Board's Report, a statement
indicating the manner in which formal annual evaluation of the performance of the Board, its committees and
individual Directors have been made and the criteria for performance evaluation of its Independent Directors, as
laid down by the Nomination & Remuneration Committee.

The Ministry of Corporate Affairs, Government of India vide notification dated 5^th June, 2015 has, inter-alia,
exempted Government companies from the above requirement, in case the Directors are evaluated by the Ministry
or Department of the Central Government which is administratively in charge of the Company, as per its own
evaluation methodology. Further, MCA vide notification dated 5^th July, 2017, also prescribed that the provisions
relating to review of performance of Independent Directors and evaluation mechanism prescribed in Schedule IV
of the Companies Act, 2013, is not applicable to Government companies.

Accordingly, HUDCO, being a government Company, is exempted in terms of the above notifications, as the
evaluation of performance of all members of the Board of the Company is being done by the Administrative
Ministry i.e., the Ministry of Housing and Urban Affairs, Gol. In view of above, as per requirement of Regulation
17(10) of the SEBI (LODR) Regulations, 2015, evaluation of Independent Directors was not made by the Board
of Directors.

Further, as per Regulation 25 (4) of the SEBI (LODR) Regulations, 2015, the performance of the Board as a whole
and non-independent director including the Chairman & Managing Director were evaluated by the Independent
Directors in a separate meeting held on 29.01.2026. Independent Directors also assessed the quality, quantity,
and timeliness of flow of information between the Company's Management and the Board. The meeting was
attended by all the Independent Directors.

(viii)    The Company is compliant with the applicable Secretarial Standards issued by the Institute of Company
Secretaries of India (ICSI).

(ix)    In compliance of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and DPE
Guidelines on Corporate Governance, based on the affirmation received from Board Members and Senior
Management Personnel, declaration regarding compliance of Code of Conduct made by the Chairman & Managing
Director is annexed and forms part of the Directors' Report. A copy of the Code is available on the website of the
Company at www.hudco.org.in

(x)    In compliance with Regulation 25(10) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015, your Company has obtained Directors and Officers Liability Insurance Policy, ensuring adequate insurance
coverage, covering all the directors of the Company including Independent Directors, Key Managerial Personnel,
and Senior Officers against the risk of financial loss including the expenses pertaining to defence cost and legal
representation expenses arising in the normal course of business.

(xi)    Energy Conservation, Technology Absorption and Foreign Exchange Earning & Outgo.

Energy Conservation and Technology Absorption

As HUDCO does not own any manufacturing unit/facility, there are no specific application relating to conservation
of energy and technology absorption. However, HUDCO, being an energy conscious organization has taken
various initiatives in the direction of energy conservation on a continuous basis.

Foreign Exchange Earnings and Outgo

During the Financial Year 2025-26, foreign exchange inflows was Rs. NIL (previous year Rs. 'NIL') and foreign
currency outflow was Rs.160.21 Crore (previous year Rs.109.69 Crore).

(xii)    There is no change in the nature of business of the Company during the year.

(xiii)    There are no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going
concern status and operations of your Company in future.

(xiv)    The Central Government has not prescribed the maintenance of cost records for the products/services of the
Company under the Companies (Cost Records and Audit) Amendment Rules, 2014 prescribed by the Central
Government under Section 148 of the Companies Act, 2013. Accordingly, cost accounts and records are not
required to be maintained by the Company.

(xv)    HUDCO has not made any application under the Insolvency and Bankruptcy Code, 2016 (31 of 2016), directly on
standalone basis during the year.

(xvi)    The Company has not entered into one-time settlement with Bank or Financial Institutions during the year, hence,
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 Institution is not given.

(xvii)    During the year under review, the Statutory Auditors, have not reported any case of fraud against the Company
by its officers or employees under Section 143(12) of the Companies Act, 2013.

(xviii) Compliance Function

HUDCO has an independent Compliance Function headed by Chief Compliance Officer for ensuring effective
monitoring of compliances in accordance with the statutory and regulatory requirements. Regulatory updates are
tracked to ensure timely implementation of requisite compliances. The Company has a robust system in place
for constant monitoring of compliances with the statutory and regulatory requirements. Structured approach is
being followed for identification, assessment and mitigation of compliance risk. With the constant monitoring and
active coordination with the concerned departments, compliance culture has been developed. The Compliance
Department acts as a nodal department for monitoring of compliances with regulatory requirements and handling
RBI Inspections.

During the year, Company has onboarded on RBI Portals - Centralized Information Management System (CIMS)
and DAKSH Portal - Reserve Bank's Advanced Supervisory Monitoring System for submission of applicable
returns and various information/compliances.

(xix)    In compliance of Office Memorandum F.No.41034/5/2022-Estt.(Res-I) dated 24.10.2025 issued by the Ministry
of Personnel, Public Grievances and Pensions, Department of Personnel and Training read with Office
Memorandum No. A-14011/12/2025-RESV. CELL dated 04.11.2025 issued by the Ministry of Housing & Urban
Affairs, Reservation Cell, Data on representation of SC, ST, OBC and others in Government posts and services
are as under

i. As on 31^st March, 2026, HUDCO has a workforce of 585 employees. The category wise details of employees
are as under:

iii.    Details of Liaison Office(s) designated by the organizations for SC/ST, OBC, PwD, EWS and Ex-servicemen,

as required in terms of instructions issued by DoPT from time to time:

iv.    Details of the Reservation Cell constituted by the organization, as required in terms of aforementioned

instructions of DoPT- The Reservation Cell has been constituted with the following officers:

1.    Shri Godwin Dan Toppo, JGM(Administration)

2.    Shri Ravi Ranjan, AGM(IT)

3.    Shri Yashpal Huria, AGM(HR)

4.    Shri Satbir Singh, SM(IT)

25. FUTURE OUTLOOK - MEDIUM AND LONG-TERM STRATEGIES

Powering India's Journey of Inclusive Progress Towards Viksit Bharat 2047

As India advances towards the vision of Viksit Bharat 2047, infrastructure development is expected to remain one of the
key drivers of economic growth, social inclusion and sustainable development. The Government of India's continued
focus on infrastructure-led development is reflected in the Union Budget 2026-27, which provides a record public capital
expenditure of Rs.12.2 Lakh Crore (Budget Estimate). Continued public investment, policy reforms and increasing
participation of institutional finance are expected to accelerate investments across housing, urban infrastructure,
transportation, water supply and sanitation, renewable energy, logistics and emerging infrastructure sectors. As a
leading NBFC-Infrastructure Finance Company (NBFC-IFC), HUDCO is well positioned to support this transformation
as key contributor to National development through long-term financing, technical consultancy and project development
support. Building on its strong financial performance and consistent with its strategic objective of expanding its loan
book beyond Rs.3 Lakh Crore by 2030, HUDCO intends to continue financing sustainable and inclusive infrastructure
that enhances quality of life and contributes to India's journey towards Viksit Bharat 2047.

a)    Catalysing Urban Transformation through the Urban Challenge Fund

The Government of India's continued emphasis on urban-led economic growth through the Urban Challenge Fund
(UCF) is expected to create significant opportunities for infrastructure financing. With a Central Assistance outlay of Rs.1
Lakh Crore during Financial Year 2025-26 to Financial Year 2030-31 and a budgetary allocation of Rs.10,000 Crore
in Financial Year 2026-27, the UCF seeks to leverage nearly Rs.4 Lakh Crore of investment through market-based
financing of transformative urban infrastructure projects. By promoting financially sustainable urban development under
the pillars of Cities as Growth Hubs, Creative Redevelopment of Cities, and Water & Sanitation, the initiative is expected
to strengthen project bankability and enhance the financial capacity of Urban Local Bodies (ULBs). Leveraging its long¬
standing engagement with State Governments, ULBs and public sector agencies, HUDCO is poised to play a pivotal
role in providing long-term financing, project structuring support and technical advisory services, thereby facilitating
implementation of reform-oriented urban infrastructure projects.

b)    Advancing Water Security and Universal Access

The Government's continued focus on expanding access to safe, regular and potable drinking water through the Jal
Jeevan Mission (JJM) is expected to create sustained opportunities for financing water infrastructure. Supported
by the Central Government's allocation of Rs.67,670 Crore under JJM for Financial Year 2026-27, investments in
climate-resilient water supply systems, treatment facilities and distribution infrastructure are expected to accelerate.
Capitalizing its NBFC-IFC capabilities, HUDCO is strategically positioned to provide affordable and long-term financing
for water supply, sanitation and allied infrastructure projects, thereby supporting improved public health, environmental
sustainability and inclusive development.

c)    Supporting Affordable Housing through PMAY-U 2.0

The implementation of PMAY-U 2.0, aimed at facilitating one crore affordable houses over the next five years with
an estimated investment of Rs.10 Lakh Crore, including Central assistance of Rs. 2.30 Lakh Crore, is expected to
strengthen India's affordable housing ecosystem. Building on its more than five decades of experience in housing finance,

HUDCO will continue to contribute to the Government's vision of Housing for All through gap funding/bridge finance and
implementation of the Interest Subsidy Scheme (ISS) under PMAY-U 2.0. The Corporation will also continue to utilize
its technical expertise by providing consultancy, Detailed Project Report (DPR) preparation, project management and
technical advisory services, wherever engaged.

d)    Promoting Sustainable Urban Mobility

India's continued investment in sustainable urban mobility is expected to generate significant opportunities for
infrastructure financing. The Union Budget 2026-27 provides an allocation of Rs.28,740 Crore for Metro Rail and
Mass Rapid Transit Systems (MRTS), alongside continued investments in Regional Rapid Transit Systems (RRTS),
multimodal transport infrastructure and transit-oriented development. With India's metro rail network continuing to
expand, the requirement for long-tenure infrastructure financing is expected to remain strong. HUDCO is expected to
play a significant role in supporting metro rail, RRTS, multimodal transport hubs and allied urban mobility infrastructure
through innovative financing solutions, contributing to improved connectivity, reduced congestion and sustainable urban
development.

e)    Financing India's Clean Energy Transition

India's commitment to achieving 500 GW energy generation through non-fossil fuel capacity by 2030 and Net Zero
emissions by 2070 is expected to drive substantial investments in renewable energy generation, transmission
infrastructure, energy storage and green hydrogen. Supported by policy initiatives including PM Surya Ghar: Muft Bijli
Yojana, PM-KUSUM, the National Green Hydrogen Mission and Green Energy Corridors, the renewable energy sector
is expected to remain a key growth area. Leveraging its growing renewable energy portfolio and NBFC-IFC status,
HUDCO intends to continue supporting eligible renewable energy and clean infrastructure projects through long-term
financing solutions.

f)    Strengthening Connectivity and Emerging Infrastructure

The Government's continued emphasis on multimodal connectivity, logistics efficiency and digital transformation is
expected to expand financing opportunities across ports, airports, inland waterways, industrial infrastructure and
logistics networks. Simultaneously, emerging sectors such as data centres, Fibre net, Battery Energy Storage Systems
(BESS), semiconductor ecosystems and AI-enabled digital infrastructure are expected to play an increasingly important
role in India's economic growth. Subject to applicable lending policies and project eligibility, HUDCO is well positioned to
support investments across these emerging infrastructure sectors, thereby contributing to a resilient, technology-driven
and low-carbon economy.

g)    City Economic Regions (CERs)- New Opportunities for Urban Infrastructure Financing

The announcement of City Economic Regions (CERs) in the Union Budget 2026-27 is expected to strengthen planned
urbanisation and regional economic development. With a proposed allocation of Rs.5,000 Crore per CER over five years
through a challenge mode and reform-cum-results-based financing mechanism, the initiative is expected to accelerate
investment in urban infrastructure and enhance demand for long-term project financing, creating new opportunities for
HUDCO to support India's urban development agenda.

h)    ESG and Sustainable Finance

As environmental, social and governance (ESG) considerations assume greater importance in infrastructure financing,
HUDCO will continue strengthening responsible financing practices through prudent project appraisal, environmental
and social risk assessment, sound governance standards and sustainable lending practices aligned with evolving
regulatory expectations and international best practices.

Looking ahead, HUDCO remains well positioned to strengthen its role as a leading infrastructure financing institution
by capitalizing its strong institutional legacy, diversified lending portfolio and enhanced capabilities as an NBFC-
Infrastructure Finance Company (NBFC-IFC). The Corporation will continue to support the development of investment-
ready and sustainable infrastructure through innovative financing solutions, technical consultancy, project preparation
support and capacity-building initiatives. By facilitating investments across affordable housing, sustainable urbanisation,
water security, clean energy, urban mobility, logistics, digital infrastructure and other priority sectors, HUDCO seeks to
contribute to inclusive, resilient and sustainable economic growth in line with the vision of Viksit Bharat 2047.

BUSINESS DEVELOPMENT ACTIVITIES

India's journey towards achieving the vision of a developed nation by 2047 ('Viksit Bharat') has gained further momentum,
with infrastructure development continuing to serve as a key growth enabler. Building on sustained policy focus in recent
years, the Government of India has further reinforced its commitment through a record capital expenditure allocation
of Rs.11.21 Lakh Crore in the Union Budget for FY 2025-26, reflecting a nearly fivefold increase over the past decade.
With the country targeting a USD 7 Trillion economy by 2030, infrastructure investment requirements are projected at
around Rs.150 Lakh Crore, with an increasing share expected from private sector participation.

In line with this accelerating infrastructure push, HUDCO has strengthened its strategic positioning to support the next
phase of growth. Backed by its stable and high-quality asset base, HUDCO has progressed from a predominantly
government-focused lending institution towards actively diversifying into new business avenues and product offerings.
With robust financial indicators, including a Provisional Coverage Ratio and a Capital to Risk-Weighted Asset Ratio,
HUDCO is well-equipped to expand its footprint in public-private partnership (PPP) and private infrastructure financing.
This strategic shift towards a more balanced and diversified portfolio, supported by calibrated risk-based pricing, is
expected to enhance overall profitability.

Building on the strategic direction set in the previous year, wherein the Board of Directors had accorded in-principle
approval to explore infrastructure financing in public-private partnership (PPP) and private sector projects across key
sectors such as Real Estate, Roads, Energy Transition, Seaports and Airports, HUDCO has made significant progress
during the current year in operationalizing this vision.

A major milestone during the year was the approval by the Board of Directors of policies and appraisal framework
for PPP/ Private Sector financing. The Board approved Entity Appraisal and Project Appraisal Guidelines, enabling
a structured and robust framework for evaluating opportunities across sectors (Real Estate and Roads in July 2025,
Energy and Airports in October 2025, and Seaports in November 2025). Further, the Board also approved the Letter
of Comfort Policy (December 2025), Take-out Finance Guidelines (December 2025), and Trust Retention Guidelines
(January 2026), thereby establishing the necessary policies for expanding HUDCO's operations in the PPP/ Private
Sector space.

Another significant achievement during the year was the execution of Memoranda of Understanding (MoUs) worth
over INR 1 Lakh Crore with various Port Authorities, including Jawaharlal Nehru Port, Mumbai Port, Visakhapatnam
Port, Paradip and Syama Prasad Mookerjee Port, and Sagarmala Finance Corporation Limited for financing both new
and existing projects, offered at competitive rates to ensure long-term sustainability and viability. These partnerships
showcase HUDCO's readiness to play a leading role in large-scale infrastructure development and demonstrate the
organization's capacity to leverage its financial strengths and policy-driven approach in catalysing growth through
public-private collaboration.

During the financial year, HUDCO also formally entered the PPP/ Private financing space and actively pursued quality
lending opportunities. As a result, multiple prospective leads were generated across sectors, culminating in the receipt
of two formal loan applications: one in the Real Estate sector with debt requirement of approximately INR 5,000 Crore
and another in the Energy sector with debt requirement of approximately INR 991 Crore. These developments mark the
successful commencement of HUDCO's lending operations in the PPP/ Private Sector space.

Going forward, HUDCO will continue to explore and participate in infrastructure projects. By aligning its efforts with the
Government of India's infrastructure push and the vision of Viksit Bharat, HUDCO aims to be at the forefront of driving
inclusive and sustainable infrastructure-led growth in the country.

URBAN INVEST WINDOW (UiWIN)

Under the guidance of the Union Ministry of
Housing & Urban Affairs, HUDCO launched the
‘Urban Invest Window’ (UiWIN) as the one-
stop facilitator for infrastructure development
of Urban Local Bodies across the country. The
UiWIN was launched by the Hon’ble Union
Minister of Housing and Urban Affairs on
8^th November, 2025 during the National Urban
Conclave. Leveraging its pan-India presence,
long-standing engagement with ULBs, and
expertise in urban infrastructure financing,
HUDCO’s 'Urban Invest Window' (UiWIN)
is uniquely positioned to institutionalise a
structured and scalable urban infrastructure
support mechanism. Key functionalities of
UiWIN, operating through HUDCO Regional
Offices functioning as State-level UiWINs, focus

on providing support in: (i) Capacity Building of ULBs; (ii) Project Formulation; (iii) Asset Management & Monetization;
and (iv) Access to Finances for the project and financial closure. UiWIN adopts a comprehensive, area-based and
ring-fenced development approach within selected ULBs, progressing systematically from project conceptualisation to
financial closure and on-ground implementation.

Working closely with the State Government and the ULBs, UiWIN will build a pipeline of bankable, investment-ready
urban projects. UiWIN is perfectly aligned with all missions of the Govt. of India for urban development, which will enable
cities to leverage the government programmes such as Urban Challenge Fund (UCF) for transformative Growth. In
addition to handholding ULBs to make projects UCF-ready as a technical agency, HUDCO would also act as a financial
intermediary, bridging ULBs with market financing as well as being a counter-part funding agency of the State share of
the Scheme. Further, UiWIN will also design to promote collaborative project planning and implementation across the
City Economic Regions (CER) as well as supporting cities by unlocking marked based financing through municipal bond
and Special Infra Grant recommended by the 16^th Finance Commission.

Since the launch of UiWIN in November 2025, Memorandum of Understandings (MoUs) have been signed with IIT / IIMs as
Knowledge Partners for Capacity Building activities of ULBs as well as with ULBs / State under UiWIN for comprehensive
area-based infrastructure development. A Regional Workshop of UiWIN was organized at Vishakhapatnam wherein 172
participants attended. A Preliminary Project Report (PPR) for availing line of credit of USD 1 Billion, jointly from World
Bank & Asian Development Bank, has been submitted to Department of Economic Affairs, MoF, Gol.

26. STATUTORY AND OTHER INFORMATION REQUIREMENT

The particulars of annexure(s) forming part of the Directors' Report are as under:

27. ACKNOWLEDGEMENT

The Board of Directors of your Company acknowledge its deep sense of appreciation for the continuous support,
guidance and cooperation extended by the Government of India, especially the Ministry of Housing and Urban Affairs,
Ministry of Rural Development, Ministry of Finance, Reserve Bank of India, National Housing Bank, Ministry of Corporate
Affairs, Department of Public Enterprises, Regulatory/Statutory Authorities and various other departments of the Central/
State Governments, Stock Exchanges, Depositories, Credit Rating Agencies, Registrar & Transfer Agents, Debenture
Trustee(s) and other agencies.

The Board of Directors also conveys its gratitude for the unstinting support and cooperation given by the shareholders,
bondholders, public deposit holders, Bankers, Financial Institutions, Housing Boards, Development Authorities,
Municipal/Local Bodies and other stakeholders associated with the Company.

The Board of Directors also acknowledges the valuable suggestions and guidance extended by Comptroller& Auditor
General of India, Statutory Auditors, Secretarial Auditors, and other professionals associated with the Company.

The Board of Directors also take this opportunity to acknowledge and appreciate the hard work and efforts put in by
HUDCO employees at all levels towards achievement of the all-round growth of the Company.

For and on behalf of the Board of Directors

Sd/-

Sanjay Kulshrestha

^Place : ^{New Delhi}    Chairman & Managing Director

^{Date : 28th July}, ²⁰²⁶    (Din: 06428038)

1

Physically Handicapped categorization is included in their respective categories

ii. Backlog reserved vacancies filled up during the year and remaining unfilled along with reasons - 1 SC and 2
OBC in Group A Backlog vacancy undertaken and were filled during the year. There are 2 Backlog vacancy
of OBC at present.