14.3) Terms/rights attached to Equity Shares

The Company has only one class of equity shares having a par value of ^ 10/- per share. Each holder of equity share is entitled to one vote per share. Dividend, as and when recommended by the Board of Directors, is subject to approval of the shareholders in their Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. The Board of Directors have not recommended any dividend during the year.

Nature and purpose of reserves

(i) Capital redemption reserve

Whenever there is a buy-back or redemption of preference share capital, the nominal value of the capital is transferred to a reserve called Capital Redemption Reserve so as to retain the capital.

(ii) Securities premium

Premium is used to record the premium (amount received in excess of face value of equity shares) on issue of shares. The reserve can be utilised only for limited purposes in accordance with the provisions of the Companies Act, 2013.

(iii) Share options outstanding account

The grant date fair value of equity-settled share-based payment transactions with employees and directors are recognised in the Statement of Profit and Loss with the corresponding credit to this account over the vesting period. The amounts recorded in Share options outstanding account are transferred to securities premium upon exercise of stock options by the employees and subsequent allotment of shares to them.

(iv) Retained earnings

Retained earnings are the profits that a company has earned to date, less any dividends or other distributions paid to the Shareholders, net of utilisation as permitted under applicable regulations

22.2) Lease Rent

The Company has entered into agreements for operating leases in respect of office premises taken on lease. Right of Use Asset is created for all the leases which are long term and non cancellable for the lease term. All the lease agreements other than that are cancellable lease contracts.

a) Under these agreements refundable interest free deposits are given.

b) All these agreements have restriction on further leasing.

The Company does not face a significant liquidity risk with regard to its lease liabilities as the current assets are sufficient to meet the obligations related to lease liabilities as and when they fall due. The weighted average incremental borrowing rate applied to lease liabilities for financial year 2023-2024 & 2024-2025 is 10%

23 Segment Reporting

The principal business of the Company is asset management of Shriram Mutual Fund and portfolio management service to the clients. Further, all the business activities are carried out within India. Since Company's principal business is asset management, hence there are no separate reportable segments as per the Indian Accounting Standard 108 (lnd AS) on 'Operating Segments'.

24 There are no capital commitments as on March 31, 2025 and March 31, 2024.

27 Contingent Liability not provided for

a) Penalty order U/s 271 (1) dt. 29/03/2022 for AY 2013-14 is ^ 1,32,086/- (31st Mar 24 ^ 1,32,086) and Company has filed an Appeal before CIT Appeal against the penalty order.

b) Demand for AY 2017-18 is ^ 17,032/- (31st Mar 24 ^ 17,032) and Company has filed an Appeal before CIT Appeal against the demand order.

c) Demand for AY 2018-19 is ^ 67,820/- (31st Mar 24 ^ 67,820) and Company has filed an Appeal before CIT Appeal against the demand order.

d) Demand for AY 2008-2009 in respect of Income Tax , relating to Tax Deducted at Source amounting to ^ 67,840/- (31st Mar 24 ^ 67,840/-).

28 Capital Management

Equity share capital and other equity are considered for the purpose of Company's capital management. The Company manages its capital in a manner which enables it to safeguard its ability to continue as a going concern and to optimise returns to the Shareholders. The capital structure of the Company is based on management's judgement of its strategic and day-to-day needs with a focus on total equity so as to maintain investor, creditors and market confidence. The funding requirements are met through operating cash flows and other equity. The management monitors the return on capital and the board of directors monitors the level of dividends to be paid to shareholders of the Company. The Company may take appropriate steps in order to maintain, or if necessary adjust, its capital structure.

29 The Code on Social Security, 2020 ('Code') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period in which the Code becomes effective.

30 Employee share based payments

The total charge for share based payment to employees towards outstanding options as at March 31, 2025, is ^ 269.50 Lakhs for the year ended March 31, 2025 (March, 2024 Rs. 121.30 Lakhs). Accounting for equity settled share based payment transaction (ESOPs) at fair value increases the non cash component of Employee Benefits Expenses and is also reflected in Share Options Outstanding Account under Other Equity. This balance of Share Options Outstanding Account is transferred to Securities Premium as and when the stock options are exercised by the employees and subsequent allotment of shares to them. Hence, this charge is neutral to Equity of the Company.

31 Pursuant to the approval of shareholders (by way of special resolution) at the extraordinary general meeting of the Company held on January 08, 2025 and pursuant to receipt of the applicable approvals (including approval from South African Reserve Bank, approval from the Competition Commission of India, approvals from the Securities and Exchange Board of India and inprinciple approval from BSE Limited), the Securities Issue Committee of the Board of Directors of the Company at its meeting held on April 23, 2025 allotted 38,88,889 Equity Shares at ^ 270 per share amounting to ^ 105,00,00,030/- (Rupees One Hundred Five Crore Thirty Only) to Sanlam Emerging Markets (Mauritius) Limited.

32 Employee share based payments

Employee stock option Plan 2022 (ESOP-2022) (Equity settled)

The Company has ESOP-2022 which covers eligible employees of the Company. The vesting of the options is from expiry of one year till 3 years/5 years as per Plan. Each Option entitles the holder thereof to apply for and be allotted / transferred one Equity Share of the Company upon payment of the exercise price during the exercise period.

Fair value of options granted

The fair value at grant date is determined using the Black Scholes Model which takes into account the exercise price, the term of the option, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option.

The options granted will vest upon the completion of service condition as specified in scheme in graded manner. Vested options are exercisable for the period of five years after the vesting.

Accounting for equity settled share-based payment transaction (ESOPs) at fair value increases the non-cash component of Employee Benefits Expenses and is also reflected in Share Options Outstanding Account under Other Equity. This balance of Share Options Outstanding Account is transferred to Securities Premium as and when the stock options are exercised by the employees and subsequent allotment of shares to them. Hence, this charge is neutral to Equity of the Company.

b) Defined benefit plans

The Company has gratuity liability ascertained on actuarial basis, wherein every employee who has completed five years or more of service is entitled to gratuity on retirement or resignation or death calculated at 15 days salary for each completed year of service, subject to a maximum of ^ 20 lacs per employee. The vesting period for Gratuity as payable under The Payment of Gratuity Act is 5 years. The plans in India typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.

Investment risk: The present value of the defined benefit plan liability is calculated using a discount rate determined by reference to government bond yields; if the return on plan asset is below this rate, it will create a plan deficit.

Interest risk: A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the plan's debt investments.

Longevity risk :The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan's liability.

Salary risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan's liability.

There are no other post-retirement benefits provided to employees.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out at March 31, 2025. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

Fair value of loans, trade and other receivables, cash and cash equivalents, other financial assets (except as mentioned in table above) approximate the carrying amounts largely due to the fact that they are short term in nature and hence the fair value for these financial instruments have continued to be same as carrying value and not disclosed in the above table.

D Fair value hierarchy

Fair value hierarchy As per Ind AS 107, 'Financial Instruments: Disclosures', the fair values of the financial assets or financial liabilities are defined as the price that would be received on sale of asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities and lowest priority to unobservable inputs.

The hierarchy used is as follows :

Level-1 Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Investment in open ended Mutual Funds are included in Level 1.

Level-2 Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Investment in unlisted open ended Mutual Fund are included in Level 2

Level-3 Inputs are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data.

The Company has an Audit & Risk Management Committee established by its Board of Directors for overseeing the Risk Management Framework and developing and monitoring the Company's risk management policies. The risk management policies are established to ensure timely identification and evaluation of risks, setting acceptable risk thresholds, identifying and mapping controls against these risks, monitor the risks and their limits, improve risk awareness and transparency. Risk management policies and systems are reviewed regularly to reflect changes in the market conditions and the company's activities to provide reliable information to the Management and the Board to evaluate the adequacy of the risk management framework in relation to the risk faced by the company.

The risk management policies aims to mitigate the following risks arising from the financial instruments:

- Credit risk

- Liquidity risk

- Market risk-price

- Market Risk-Interest Rate

- Market Risk-Foreign Exchange

ⁱ⁾ Credit risk management:

Exposure to credit risk

Financial services business has a risk management framework that monitors and ensures that the business lines operate within the defined risk appetite and risk tolerance levels as defined by the senior management. The amortised cost of the financial assets represents the maximum credit risk exposure.

Investment in Fixed Deposit

The Company has made investments in Fixed Deposit. Funds are invested after taking into account parameters like safety, liquidity and post tax returns etc. The Company avoids credit risk by investing in organization with good credit rating profile and sound financial position.

Loans

All the loans are stage 1 assets with no default history and forward looking information is monitored to manage the risk.

Trade and Other Receivables

Exposures to customers' outstanding at the end of each reporting period are reviewed by the Company to determine incurred and expected credit losses. Historical trends of collection from counterparties on timely basis reflects there is no credit risk. As the Company has a contractual right to such receivables as well as control over preponderant amount of such funds due from customers, the Company does not estimate any credit risk in relation to such receivables.

Liquidity risk refers to the risk of financial distress or extraordinary high financing costs arising due to shortage of liquid funds in a situation where business conditions unexpectedly deteriorate and requiring financing. The company requires funds for short term operational needs. The company manages liquidity risk by maintaining adequate reserves, and by matching the maturity profiles of financial assets and liabilities.

The tables include both interest and principal cash flows.

To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the end of the reporting period. The contractual maturity is based on the earliest date on which the company may be required to pay.

iv) Market risk (Interest Rate Risk)

The Company's investments on which it get interest income are primarily in fixed rate interest instruments. Accordingly, the exposure to interest rate risk is insignificant.

v) Market risk (Currency Risk)

The Company does not have amount of foreign currency denominated assets. Accordingly, there is no exposure to currency risk.

Footnote- The amounts disclosed towards employee benefits for Key Managerial Personnel does not include the provision for gratuity, leave encashment, bonus and ESOP's.

38. Corresponding figures for the previous period have been regrouped wherever necessary to confirm the current period classification.