Supra Pacific Financial Services Ltd

To

THE MEMBERS

SUPRA PACIFIC FINANCIAL SERVICES LIMITED

Your Directors present herewith the 38^th Annual Report of your company together with the Audited Accounts for the year ended 31^st March 2024.

FINANCIAL RESULTS

The financial results for the year 2023-2024 are summarised herein below: -

OPERATIONS:

During the year, the Company has registered a profit of Rs. 55.16 lakh from the operation of the company as against profit of Rs. 25.65 lakh from previous financial year.

Your Company posted total income and net profit of Rs. 2,591.43 Lakh and Rs. 55.16 Lakh respectively, for the financial year ended March 31, 2024, as against Rs. 1236.33 Lakh and Rs. 25.65 Lakh respectively, in the previous financial year. Your Company has transferred an amount of Rs. 11.03 Lakh to Reserve Fund under Section 45-IC of the RBI Act, 1934.

The Company has made Preferential allotment of 7682500 and 6184561 equity shares on 18.10.2023 and 17.02.2024 respectively.

DIVIDEND:

Your Directors regret their inability to recommend any dividend for the year under review.

SHARE CAPITAL:

The authorized capital of the company is Rs. 50,00,00,000 and the paid capital of the company is Rs. 26,69,60,360.

Non-Convertible Debentures

During the year under review, the Company has raised Rs. 19,10,55,000 through the issuance of privately placed Secured, Redeemable, Non-Convertible Debentures. The proceeds of the issue have been utilised for augmenting the working capital resources of the company and expanding the loan portfolio as well as for the general expansion activities of the company.

Subordinated Debts

During the year under review, the Company has raised Rs. 29,78,78,000 through issuance of subordinated, unsecured, redeemable in the form of subordinated debt for inclusion as Tier II Capital.

DEBENTURE REDEMPTION RESERVE

Pursuant to notification issued by Ministry of Corporate Affairs on 16th August, 2019 in exercise of the powers conferred by subsections (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013), the Central Government amended the Companies (Share Capital and Debentures) Rules, 2014.

In the principal rules, in rule 18, for sub-rule (7), the limits with respect to adequacy of Debenture Redemption Reserve (DRR) and investment or deposits for listed companies (other than All India Financial Institutions and Banking Companies as specified in subclause (i)), Debenture Redemption Reserve is not required to maintain in case of public issue of debentures as well as privately placed debentures for NBFCs registered with Reserve Bank of India under section 45-IA of the RBI Act, 1934. Therefore, the Company has not created DRR during the year ended 31 March 2024.

Further, the Company shall on or before the 30th day of April in each year, invest or deposit, as the case may be, a sum which shall not be less than fifteen percent, of the amount of its debentures maturing during the year ending on the 31st day of March of the next year in the manner mentioned in Rule 18(7) (c). Accordingly, the Company has deposited ?146.00 Lakh in deposit account for debenture redemption.

DIRECTORS:

The Board of Directors of your company comprises of, Shri. Joby George (DIN:06429801) Chairman and Managing Director, two Non-Executive Directors Shri. Sandeep Babu (DIN:08242822) and Shri. Manoj K (DIN:08760264) and four Non-Executive Independent Directors, namely, Shri. Murali NA (DIN:09201589), Smt. Dhanya Jose DIN:09724286, Shri. Anvar KS (DIN:09763977) and Shri. Joly Sebastian (DIN: 10168844) and one Executive Director Shri. Abidh Abubakkar (DIN:08569590).

In accordance with the provisions of Section 152 of Companies Act, 2013, Shri. Manoj K (DIN:08760264) will retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the requirement of Section 134 (5) of the Companies Act, 2013, and based on the representations received from the management, your Directors confirm that;

(i) In the preparation of the Annual Accounts for the year ended 31st March, 2024, the applicable Accounting Standards have been followed and there are no material departures.

(ii) Selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the profit & loss of the company for the financial year ended 31st March, 2024.

(iii) Taken proper and sufficient care to the best of knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities.

(iv) Prepared the Annual Accounts on a going concern basis.

(v) Had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(vi) Devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

PUBLIC DEPOSIT:

As you are aware, the Company is a Non-Systemically Important Non-Deposit Taking NBFC and hence has not accepted any public deposits

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS:

During the financial year 2023-2024,15 Board meetings were convened and held, which is in compliance with the provisions of the Companies Act, 2013. The details thereof are given in the Corporate Governance Report. The intervening gap between the Meetings were within the period prescribed under the Companies Act, 2013.

KEY MANAGERIAL PERSONEL

During the year under report, Following Officials acted as Key Managerial Personnel: -

(i) Shri. Joby George- Managing Director

(ii) Shri. Jithin George - Chief Financial Officer

(iii) Smt. Leena Yezhuvath - Company Secretary

CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION. FOREIGN EXCHANGE EARNINGS AND OUTGO:

Particulars under the Companies (Disclosure of particulars in the report of the Board of Directors) Rules, 1988 on the Conservation of Energy and Technologies absorption is not applicable to your Company.

The Company is not having Foreign Exchange Earnings.

MATERIAL CHANGES AND COMMITMENTS. IF ANY. AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENT RELATE AND THE DATE OF THE REPORT.

There have been no material changes and commitments affecting the financial position of your Company which have occurred between the end of the financial year i.e. 31 March.

2024 to which the Financial Statements relate and the date of the report except for the following:

During the year under review, Shri Arun Kumar CM Non-Executive Non Independent Director resigned from the Board w.e.f. 16^th June, 2023 due to personal reasons.

Shri Joly Sebastian (Non-Executive Independent Director) and Shri. Manoj Karumathil (Non-Executive Non Independent Director) were appointed in the Board meeting held on 15^th June, 2023.

Shri. Abidh Abubakkar, was appointed as Executive Director in the Board meeting held on 29/11/2023 and the above appointments were regularized on approval from shareholders through Postal Ballot.

A Fresh certificate of incorporation had been issued by Registrar of Companies due to change in name of the company from "SUPRA PACIFIC MANAGEMENT CONSULTANCY LIMITED" to "SUPRA PACIFIC FINANCIAL SERVICES LIMITED" during the Financial year on 20.06.2023.

STATUTORY AUDITORS AND THEIR REPORT:

Pursuant to the provisions of Sections 139 and 141 of the Companies Act 2013 and Rules made thereunder, The Statutory Auditors of the Company M/s G Joseph & Associates, Chartered Accountants, Kochi (FRN:006310S) hold office till the conclusion of the ensuing Annual General Meeting and being eligible themselves for re-appointment, the auditors have given their written consent for their subsequent re-appointment as the Company's Statutory auditors of the Company to hold office for a period of Five years from until the conclusion of 43^rd Annual General Meeting the Company subject the rectification of shareholders.

Further, the Auditors' Report "with an unmodified opinion", given by the Statutory Auditors on the Financial Statements of the Company for FY 2023-24 is disclosed in the Financial Statements forming part of the Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Statutory Auditor in their Report for the year under review. One instance of fraud (identified by Company) in terms of the provisions of section 143(12) of the Act have been reported by the Statutory Auditors in their report for the FY 2023-24. The Board of Directors in its meeting held on August 13, 2024 recommended the re-appointment of M/s. G Joseph &. Associates (ICAI Firm Registration No.006310S) Statutory Auditors of the Company, in terms of the RBI guidelines and Companies Act 2013, to hold office for a continuous period of Five years until the conclusion of 43^rd Annual General Meeting of the Company to be held in the year 2029, to the shareholders for approval.

PERSONNEL & INDUSTRIAL RELATIONS

Industrial Relations were cordial and satisfactory. There were no employees whose particulars are to be given in terms of Section 134(3)(q) of the companies Act, 2013 read with Rule 5(2) and 5(3) of the companies (Appointment and Remuneration of Managerial personnel) Rules, 2014.

CORPORATE GOVERNANCE:

As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Regulations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance practices followed by the Company, together with a Certificate from the Company's Auditors confirming compliance, forms an integral part of this Report.

SUBSIDIARY COMPANIES:

The Company does not have any subsidiary.

CSR POLICY

As per the provisions of Section 135 read with the Section 198 of the Companies Act 2013, the company do not have CSR obligation for the year 2023-24. Accordingly, there has been no meeting of CSR Committee held during the year.

RISK MANAGAMENT

The Company has laid down a well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process. A detailed exercise is being carried out to identify, evaluate, manage and monitor business risks. The Audit Committee and the Board periodically review the risks and suggest steps to be taken to manage/ mitigate the same through a properly defined framework. During the year, risk analysis and assessment was conducted and no major risks were noticed, which may threaten the existence of the company

CODE OF CONDUCT:

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The Code gives guidance through examples on the expected behavior from an employee in a given situation and the reporting structure.

All the Board Members and the Senior Management personnel have confirmed compliance with the Code.</p>

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company continues to comply with Secretarial Standards on Board Meetings (SS-1) and General Meetings (SS-2), issued by the Institute of Company Secretaries of India.

MANAGEMENT DISCUSSION AND ANALYSIS

A separate report on the Management discussion and analysis forms an integral part of this report.

DECLARATION FROM INDEPENDENT DIRECTORS

Your Company has received necessary declarations from all Independent Directors of the Company confirming that they meet the criteria of Independence as mentioned in Section 149 of the Act and SEBI Listing Regulations. Independent Directors have confirmed that they have registered their names in the Independent Directors' Databank. In the opinion of the Board, the Independent Directors continue to fulfil the criteria prescribed for an independent director as stipulated in Regulation 16(l)(b) of the SEBI Listing Regulations and Section 149(6) of the Act and are independent of the management of the Company.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company other than the sitting fees, commission, if any and reimbursement of expenses incurred for the purpose of attending the meetings of the Board or Committees of the Company.

During the year, a meeting of Independent Directors was held on following dates 24/08/2023 ,01/01/2024,04/03/2024 as required under the Companies Act, 2013 and in Compliance with requirement under Schedule IV of the Act and as per requirements of

SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and discussed matters specified therein.

FAMILIARISATION PROGRAMME FOR DIRECTORS:

At the time of appointing a Director, a formal letter of appointment is given to him/her, which inter alia explains the role, function, duties and responsibilities expected of him as a Director of the Company. The Director is also explained in detail the Compliance required from him under the Companies Act, 2013, SEBI (LODR) Regulations, 2015 and other relevant regulations and affirmation taken with respect to the same. The Chairman and the Management has also one to one discussion with the Directors to familiarize with the company's operations.

PREVENTION OF INSIDER TRADING:

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code prohibits the purchase or the sale of Company's shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for the implementation of the Code.

All Board Directors and the designated employees have confirmed compliance with the Code.

SECRETARIAL AUDIT

During the year under review, CS Vivek Kumar, Practicing Company Secretary (M.No. F9353; CP No. 11036), DV & Associates,who was appointed as the Secretarial Auditor of the Company has issued the audit report in respect of the secretarial audit of the Company for the financial year ended March 31, 2024.

The Audit Report is attached as Annexure I and forms an integral part of this Report.

PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Notes to Financial Statements forming part of this report.

ANNUAL RETURN:

Annual return in Form-MGT-07 has been posted in the website the link of the same is mentioned below for reference https://suprapacific.com/poiicies-investors- information/

DISCLOSURE REGARDING MANAGERIAL REMUNERATION AS REQUIRED UNDER SECTION 197( 12! OF THE COMPANIES ACT. 2013 READ WITH RULE 5m OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL! RULES. 2014

During the year under review, your Company enjoyed cordial relationship with workers and employees at all levels. The company regards its employees as great asset.

For the particulars of employees as required to be disclosed in the Directors Report in accordance with the Provisions of Section 197 of the Companies Act, 2013 read with Rule

5 (2) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, the Directors state that:

1. The ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the Financial Year 2023-24 and the percentage increase in remuneration of each Director, Chief Financial Officer & Company Secretary during the financial year 2023-24 are as under:

2. During the year under review, there is an increase of 64.64 % in the median remuneration of employees.

3. There were 428 permanent employees on the rolls of Company as on March 31, 2024;

4. It is hereby affirmed that the remuneration paid is as per the Nomination & Remuneration Policy of the Company.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has robust internal control policies and procedures in place, commensurate with the size, scale, and complexity of its operations. To ensure effective internal controls across business process and systems, it has established a vigorous framework that is designed to provide reliable and quality assurance related to its business and operational performance. The adequacy and efficacy of these controls are evaluated on a regular basis and ensure compliance with applicable laws and safeguard the Company assets.

The Company's Audit Committee is entrusted to review the Internal Control Systems and the appointment of Internal Auditors for each of the business verticals of the Group. M/s. Vasan & Wales is acting as the Internal Auditor of the company.

The Internal Auditor evaluates the adequacy of the internal control system in the Company on the basis of Statement of Operations Procedure, instruction manuals, accounting policy and procedures.

RELATED PARTY TRANSACTIONS:

Contracts / arrangements / transactions entered by the Company during the FY 2023- 2024 with related parties under Section 188 of the Act were in ordinary course of business and on arm's length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the provisions of Regulation 23 of SEBI LODR and the Company's policy on related party transactions. Therefore, particulars of contracts / arrangements with related parties under Section 188 in Form AOC-2 is enclosed as Annexure II with this report.

PERFORMANCE EVALUATION OF BOARD. COMMITTEES & INDIVIDUAL DIRECTORS

A formal evaluation of the performance of the Board, it's Committees, the Chairman and the individual Directors was carried out for the year 2023-24 by the Nomination & Remuneration Committee.

As part of the evaluation process, the performance of Non-independent Directors, the Chairman and the Board was done by the Independent Directors. The performance evaluation of the respective Committees and that of independent and non-independent Directors was done by the Board excluding the Director being evaluated. The Directors expressed satisfaction with the evaluation process.

NOMINATION AND REMUNERATION POLICY:

Pursuant to the provisions of Section 178(3) of the Act and Regulation 19 of the SEBI Listing Regulations, the Board has formulated Nomination and Remuneration Policy of the Company which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors, identification of persons who are qualified to become Directors, Key Managerial Personnel and Senior Management. The Nomination and Remuneration Policy also covers the Remuneration of the Directors, Key Managerial Personnel, Senior Management and other employees of the Company. The Nomination and Remuneration Policy is available on the website of the Company.

VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Company has in place a whistleblower policy, to support the Code of conduct of the Company. This policy documents the Company's commitment to maintain an open work environment in which employees, consultants and contractors are able to report instances of unethical or undesirable conduct, actual or suspected fraud or any violation of Company's Code of conduct at a significantly senior level without fear of intimidation or retaliation.

POLICY FOR PREVENTION OF SEXUAL HARASSMENT (POSH1 OF WOMEN AT WORKPLACE:

In accordance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made there under, the Company formulated an internal Policy on Sexual Harassment at Workplace (Prevention, Prohibition and Redressal) during the year under review. An internal Complaint Committee has been set up to redress complaints received regarding sexual harassment. All woman employees (permanent, contractual, temporary, trainees) are covered under this policy.

During the year under review there were no complaints received by the Company related to sexual harassment.

APPLICABILITY OF COST AUDIT REQUIREMENTS

Maintenance of cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, is not applicable to the Company.

KNOW YOUR CLIENT POLICY:

Reserve Bank of India (RBI) has issued guidelines on 'Know Your Customer' (KYC) Guidelines - Anti Money Laundering Standards for Non-Banking Finance Companies (NBFCs) thereby setting standards for prevention of money laundering activities and corporate practices while dealing with their customers vide Circular Nos.: DNBR (PD) CC No. 051/3.10119/2015-16, dated July 1, 2015. Similarly, KYC guidelines have been issued by NSDL and CDSL on customer identification and proof of address at the time of opening the account and for subsequent changes/modification etc. The Company has adopted all the best practices prescribed by RBI from time to time and shall make appropriate modifications if any necessary to this code to conform to the standards so prescribed.

INTERNAL FINANCIAL REPORT:

The Board has adopted policies and procedures for efficient conduct of business. The Audit Committee evaluates the efficiency and adequacy of financial control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and strives to maintain the Standard in Internal Financial Control.

COMPLIANCE WITH NBFC REGULATIONS

Your Company has complied with all the regulatory provisions of the Reserve Bank of India applicable to Non-Banking Financial Company - Non-Systemically Important Non-Deposit taking Company.

As on 31 March, 2024, the Capital Adequacy Ratio of the Company is 50.86%, well above the statutory requirement of 15%.

LISTING WITH STOCK EXCHANGES

Your Company confirms that it has paid the Annual Listing Fees for the financial year 2023- 24 to BSE where the Company's shares are listed.

MATERIAL AND SIGNIFICANT ORDERS PASSED BY REGULATORS & COURTS:

No significant and material orders have been passed by any regulators or courts or tribunals against the Company impacting the going concern status and Company's operations in future.

MAINTENANCE OF COST RECORDS

The Company is an NBFC, and hence the requirement under sub-section (1) of section 148 of the Companies Act, 2013 w.r.t Maintenance of cost records is not applicable

ACKNOWLEDGEMENT:

Our Directors express their sincere appreciation of the co-operation received from shareholders, bankers and other business constituents during the year under review. Our Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers and staff resulting in the performance of the Company during the year.