Your Directors have pleasure in presenting the 73rd Annual Report together with audited accounts for the year ended 31st March 2026. The summarised financial results of the Company are presented hereunder:

FINANCIAL RESULTS: STANDALONE

(Rs. in crores)

DIVIDEND

Your Company paid an interim dividend of Rs. 16/- per share in February 2026. Your Directors are pleased to recommend a final dividend of Rs. 24/- per share, which, together with the interim dividend, would aggregate to a total dividend of Rs. 40/- per share (400 per cent on the face value of Rs. 10/-), representing a dividend pay-out of 24.23 per cent.

The Dividend Distribution Policy, formulated in accordance with the provisions of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been disclosed on the website of the Company under the web link -

https://sundaramfinance.in/assets/app_docs/investor-info/corporate_governance/policies/sebi/sfl_policy_for_distribution_of_dividends.pdf?v=1.1

CORPORATE GOVERNANCE

Your Company has always focused on ensuring the highest standards for prudence, ethics and transparency in corporate governance over the decades. The Board of Directors serve as stewards of the performance and health of your Company. The Board's mandate is to oversee your Company's strategic direction, monitor the performance of your Company, its subsidiaries & joint venture, maintain highest ethical standards of governance, assess the adequacy of risk management measures, evaluate internal financial controls, authorise and monitor strategic investments, facilitate and review Board and senior management succession planning and oversee regulatory compliance and corporate social responsibility activities. The Directors' deep industry knowledge, functional specialization and decades of experience has helped your Company handle complex issues related to macroeconomic uncertainty, regulatory changes, technological & digital developments, market volatility & risk management and information security & cyber security threats.

The Corporate Governance Report of the Company provides information about the corporate philosophy, details of the Directors and their other directorships, number of Board Meetings and Committee Meetings held during FY 2025-26, various other details which evidence the fact that the Company is customer-oriented, respectful in letter and spirit of all the regulatory provisions, mindful of high quality standards in all areas and, above all, follows a time-tested approach that balances growth with quality and profitability.

A detailed report on corporate governance, together with a certificate from the Secretarial Auditor, in compliance with the relevant provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is attached as part of this report, vide Annexure I.

Compliance reports in respect of all laws applicable to the Company have been reviewed by the Board of Directors.

RELATED PARTY TRANSACTIONS

All transactions with related parties were in the ordinary course of business and on an arm's length basis. The Company did not enter into any material transaction with such related parties, under Section 188 of the Companies Act, 2013, during the year. Form AOC-2, as required under Section 134

(3) (h) of the Act, read with Rule 8 (2) of the Companies (Accounts) Rules 2014, is attached as part of this report, vide Annexure II (i). The Company's Policy on Related Party Transactions is attached as part of this report, vide Annexure II (ii).

The Company did not have any transactions with any person or entity belonging to the promoter or promoter group and holding 10 per cent or more shareholding in the Company.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company, along with its subsidiaries and associates, has always proactively invested in a responsible manner to the growing needs of the communities in which it operates and has responded swiftly to health-related complications, weather & catastrophic events and other unexpected challenges that have impacted these communities. During the year, your Company has, in consonance with the CSR Policy of the Company, undertaken a number of initiatives that contribute to society at large, in the areas of healthcare, education, environmental sustainability and ecological balance, and preservation of the country's rich culture and heritage. The highlights of the CSR activities are:

1. Average Net Profit computation in accordance with Sec.135(5): Rs. 1,48,000.00 lakhs

2. CSR Budget, Amount spent in CSR, amount un-spent if any and amount to be set off in the financial year, if any.

The Annual Report on CSR Activities undertaken by the Company for FY 2025-26 is attached as part of this report, vide Annexure III.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

A Business Responsibility and Sustainability Report (BRSR) as required under Regulation 34(2) (f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, is enclosed as part of this report, vide Annexure IV. Further, as required under the SEBI Circular on BRSR Core - Framework for Assurance and ESG Disclosures for Value Chain dated 12th July, 2023, the Company has undertaken a reasonable assurance of the BRSR Core during the year and the Independent Practitioner's Reasonable Assurance Report issued by M/s Sundaram and Srinivasan, Chartered Accountants, Chennai, is enclosed as part of this report.

DISCLOSURE UNDER THE ‘PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE POLICY'

The Company has in place a Policy for prevention of sexual harassment, in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention,

Prohibition & Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

DISCLOSURE UNDER THE PROVISIONS OF MATERNITY BENEFIT ACT, 1961

The Company is in compliance with the provisions of the Maternity Benefit Act, 1961. Details have been provided in the Business Responsibility and Sustainability Report.

SECRETARIAL AUDIT

M/s Damodaran & Associates LLP, Practising Company Secretaries, have been appointed as the Secretarial Auditor of the Company, for a term of five (5) consecutive years w.e.f. 1st April 2025, in accordance with the provisions of Regulation 24A of the SEBI (LODR) Regulations, 2015. The Secretarial Audit Report and Secretarial Compliance Report, as provided by them, are attached as part of this report, vide Annexures V(i) and (ii) respectively.

REMUNERATION TO DIRECTORS / KEY MANAGEMENT PERSONNEL

Disclosure pursuant to Rule 5 (1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as part of this report, vide Annexure VI.

SUNDARAM FINANCE EMPLOYEE STOCK OPTION SCHEME (SFESOS)

Based on the recommendations of the Nomination, Compensation and Remuneration Committee, the Board has granted, subject to regulatory approvals where necessary, 14,629 stock options to select eligible employees, on 25th May 2026. The information required under Rule 12 of the Companies (Share Capital and Debenture) Rules, 2014, read with Reg. 14 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 is furnished, vide Annexure VII and Notes to the Accounts (Refer Note No. 41).

EXTRACT OF ANNUAL RETURN

As required under Section 92 (3) of the Companies Act, 2013, read with Rule 12 (1) of the Companies (Management and Administration) Rules, 2014, the link for the Extract of the Annual Return in E-form MGT-7 is

https://sundaramfinance.in/assets/app_docs/downloads/annual-reports/2025-2026/eform_mgt_7_annual_return_2025_26_26062026.pdf

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

During the year under review, no significant and material orders were passed by the regulators, courts, or tribunals against the Company, impacting its going concern status or its future operations.

INFORMATION AS PER SECTION 134 (3) (M) OF THE COMPANIES ACT, 2013 READ WITH RULE 8 OF THE COMPANIES (ACCOUNTS) RULES, 2014

The initiatives taken by your Company towards conservation of energy have been provided in the Business Responsibility and Sustainability Report, which has been annexed to this Report.

Further, your Company's initiatives towards technology absorption have been provided in the portion relating to Information Technology, forming part of this Report. During FY 2025-26, expenditure in foreign currencies amounted to

`0.08 cr. There were no earnings in foreign currency during the year.

Global Economy

During the year under review, the global economy remained fragile amid persistent geopolitical tensions, tariff measures and the outbreak of war in West Asia in late February 2026. These developments heightened risks to global growth and disrupted commodity markets, inflation expectations, financial conditions and global demand. Damage to critical energy infrastructure and closure of the Strait of Hormuz adversely affected freight movement and supply chains across crude oil, hydrocarbons, fertilisers and other key commodities.

In view of the rapidly evolving environment, the World Economic Outlook (WEO) has presented the current outlook by way of a "reference forecast" and projected global growth at 3.1 per cent in 2026 and 3.2 per cent in 2027, as against an average growth rate of around 3.4 per cent during 2024-25. Over the medium term, global growth is expected to remain below the historical average of 3.7 per cent recorded during 2000 to 2019. Global headline inflation is projected at 4.4 per cent in 2026 and 3.7 per cent in 2027, both reflecting upward revisions.

Given the prevailing uncertainty, the outlook is supplemented by adverse scenarios involving a more prolonged or wider escalation of the conflict and/or greater damage to energy infrastructure in the affected region. Under such scenarios, global growth in 2026 could moderate further to around 2.0-2.5 per cent, while global inflation could rise to approximately 5.4-6.0 per cent. The adverse effects under such scenarios are expected to be more pronounced for emerging market and developing economies.

Over the medium term, prospects could improve with renewed structural reforms and a durable easing of trade tensions; however, any further escalation or geographic spread of the conflict would remain a material downside risk to the global outlook.

Indian Economy

Despite global uncertainties, the Indian economy remained resilient in FY 2025-26. As per the NSO's Second Advance Estimates under the revised GDP series (base year 2022-23), real GDP grew 7.6 per cent, driven by robust private consumption and strong fixed investment, while net external demand remained subdued. On the supply side, real GVA grew 7.7 per cent, led by services and supported by manufacturing; services, industry, and agriculture and allied activities grew 9.1 per cent, 6.2 per cent, and 3.1 per cent respectively.

Industrial activity in early FY 2026-27 has, however, been affected by the crisis in West Asia, with the fertiliser sector among the most impacted due to disruptions in gas and chemical supplies. The Government has responded with measures to address supply disruptions, preserve energy security, support trade and logistics, and maintain overall macroeconomic stability.

Headline CPI inflation moderated from about 3.8-4.0 per cent in early 2025 to near zero by October 2025, before rising to around 3.4-3.6 per cent by March 2026. The decline was driven mainly by a sharp fall in food inflation, while the subsequent increase reflected unfavourable base effects and emerging cost pressures from higher energy and commodity prices. Core inflation remained broadly stable at around 3.7 per cent.

During FY 2025-26, the Reserve Bank of India's Monetary Policy Committee (MPC) shifted its posture from restraint to calibrated easing, reducing the repo rate cumulatively to 5.25 per cent by December 2025 in response to moderating inflation and resilient growth conditions. In April 2026, in view of the supply-side shocks and risks to growth and inflation arising from the conflict in West Asia, the MPC adopted a cautious ‘wait and watch' approach and kept the policy repo rate unchanged at 5.25 per cent. The Reserve Bank also continued to manage liquidity actively in order to support transmission while preserving financial stability. Notwithstanding the reduction in policy rates, bond yields remained elevated, particularly in the latter half of the year, reflecting concerns relating to imported inflation through higher oil prices, the implications for the current account deficit, and continued monetary tightness in global markets.

India's fiscal deficit stood at 4.4 per cent of GDP in FY 2025-26 and is estimated at 4.3 per cent of GDP in FY 2026-27, reflecting prudent fiscal management and supported by sustained growth in revenue collections over recent years. During FY 2025-26, the Indian Rupee depreciated amid tariff measures introduced by the United

States, sustained portfolio outflows and elevated energy import costs arising from the conflict in West Asia and touched an all-time low of `94.65 per US dollar in March 2026. As at 31 March 2026, the country's foreign exchange reserves stood at USD 691.11 billion, equivalent to 10.8 months of projected merchandise imports for FY 2025-26 and 21.9 per cent of outstanding external debt as at end-December 2025.

Automotive Sector

After a modest start to the year, the Indian automotive industry recorded its highest-ever sales across the principal vehicle segments in FY 2025-26 after seven years. Domestic sales across passenger vehicles, commercial vehicles, two-wheelers and three-wheelers reached record levels, supported by improved affordability, reduction in policy rates, changes in income-tax slabs, GST-related reforms and resilient domestic demand. As per data released by the Society of Indian Automobile Manufacturers (SIAM), the strong performance was driven largely by momentum in the second half of the year.

Passenger vehicle sales increased by 7.9 per cent year-on-year to 46.4 lakh units in FY 2025-26, representing the highest-ever annual volumes for the segment. The increase was supported by tax and interest-rate measures, improved affordability and stronger consumer sentiment in the second half of the year. Electric passenger vehicle registrations also recorded healthy growth, reflecting a gradual structural shift towards alternative powertrains.

The commercial vehicle segment recorded sales of 10.8 lakh units in FY 2025-26, reflecting growth of 12.6 per cent over the previous year. Demand was supported by GST-related reforms, fleet operator demand across subsegments, increased economic activity and public capital expenditure. The reduction in the policy repo rate also aided market sentiment by easing the cost of financing. Electric light commercial vehicles witnessed improving acceptance, supported by favourable total cost of ownership dynamics and rising adoption among organised fleet operators. Electric small commercial vehicles also recorded early traction from a low base, aided by intra-city logistics demand.

The tractor and farm equipment segment also recorded strong growth during FY 2025-26, increasing by 23.5 per cent over the previous year. Growth in the segment was supported by favourable monsoon conditions, improved rural sentiment, stronger farm incomes, and the benefit of lower financing costs.

Automotive exports grew by 24 per cent during the year, reflecting continued global acceptance of Indian automotive products. Passenger vehicle exports registered their highest-ever levels for the second consecutive year, recording growth of 17.5 per cent over FY 2024-25, while commercial vehicle exports increased by 17.4 per cent over the previous year.

The outlook for the automotive sector for FY 2026-27 remains favourable, supported by strong macroeconomic fundamentals and healthy domestic demand. At the same time, geopolitical developments in West Asia continue to pose risks through their potential impact on supply chains, vehicle production, commodity prices, freight costs and broader economic activity. Consequently, an early de-escalation and resolution of the conflict would be important for sustaining growth momentum in the sector.

Operating & Financial Performance

Against the backdrop of a volatile economy, your Company's overall performance for the year has been well balanced across growth, asset quality and profitability. Gross receivables managed by your Company as of March 31, 2026, stood at

`70,137 cr., as against Rs. 60,290 cr., recording a growth of 16.3 per cent over the previous year. Your Company's disbursements at Rs. 32,321 cr. (PY Rs. 28,405 cr.) have registered a reasonable growth of 13.8 per cent during the year under review.

During the year, your Company's "AAA" credit rating and the treasury team's ability to raise resources at competitive rates enabled your Company to maintain its cost of borrowings at a best-in-class level. Despite competitive intensity and mix of price-sensitive medium & heavy commercial vehicle segments, your Company was able to maintain yields through better pricing of risk and improving asset mix. Consequently, your Company's focus on improving pricing and managing borrowing costs well has yielded positive results on margin expansion in FY 2025-26.

Collections in the financial system remained a challenge for a significant part of the year due to macro-economic uncertainties and fragile finances of some State Governments. However, your Company's consistent and focused efforts through the year, coupled with improvement in demand, economic activity and sentiments towards the later part of the year, enabled a notable improvement in the fourth quarter. Your Company's superior credit standards, strong customer relationships and systematic collection efforts have enabled it to ensure best-in-class performance on asset quality in the year in question. Stage 3 assets, Gross and Net of ECL provisions, stood at 1.44 per cent (PY 1.44 per cent) and 0.69 per cent (PY 0.75 per cent) respectively, as at 31st March, 2026.

Your Company maintained disciplined control over operating expenses during the year under review. The cost-to-income ratio stood at 28.71 per cent as at 31st March 2026, as compared to 30.80 per cent in the previous year. Prudent management of operating expenditure continues to remain an area of focus for your Company.

Your Company has been maintaining comfortable liquidity in the form of liquid investments and undrawn bank limits, to meet its maturing liabilities.

Your Company registered a net profit of Rs. 1,834 cr. compared to Rs. 1,543 cr. in the previous year, a growth of 19 per cent. Profits from core operations registered a growth of 16 per cent. Your Company's net worth stood at Rs. 12,715 cr., as on 31st March 2026. Capital adequacy (CRAR) at 18.95 per cent was comfortably higher than the statutory requirement of 15 per cent.

There are no significant changes in key financial ratios of the Company for FY 2025-26 as compared to FY 2024-25. Your Company's Return on Net Worth as on 31.03.2026 stood at 17.5 per cent as compared to 16.3 per cent as on 31.03.2025. Core Return on Net Worth, adjusting for investments in Group companies, as on 31.03.2026 stood at 18.4 per cent as compared to 19 per cent as on 31.03.2025.

a) Deposits

During the year, your Company mobilised fresh deposits aggregating to `929.46 cr. Renewal of deposits during the year amounted to Rs. 2,374.34 cr. representing 78 per cent of the matured deposits of Rs. 3,052.08 cr. Deposits outstanding at the year-end were at Rs. 6,216.24 cr. as against Rs. 6,094.08 cr. in the previous year. The net accretion for the financial year was Rs. 122.15 cr. as at 31st March 2026. 2,975 Term Deposit Receipts (TDRs) amounting to Rs. 43.28 cr. had matured for payment and were due to be claimed or renewed. After close follow-up, these figures are currently at 2,109 and Rs. 21.91 cr. respectively. Continuous efforts are being made to arrange for repayment or renewal of these deposits. There has been no default in repayment of deposits or payment of interest thereon during the year.

You will be happy to note that as part of the continued digital journey, your Company has introduced online fresh deposits for new depositors. Depositors can also place additional deposits, renew their deposits, initiate payment requests, furnish Form No. 121, provide instruction for change in address and/or bank details with necessary supporting documents, through our online customer portal and SF Next mobile application.

b) Term Funding

During the year, your Company raised term funding from Banks, Mutual funds, Insurance companies and others in the form of non-convertible debentures and long term loans to the tune of Rs. 14,840 cr., across varying tenors.

c) Bank Finance

As part of the overall funding plan, your Company's working capital limits with consortium banks were retained at Rs. 3,500 cr. During the year, your Company also issued several tranches of commercial paper aggregating to `7,900 cr. The maximum amount of outstanding commercial papers at any time was Rs. 6,055 cr. and the amount outstanding at the end of the year was Rs. 3,750 cr.

d) Assets Securitised / Assigned

During the year, your Company raised resources to the extent of Rs. 4,450 cr. through securitisation and assignment of receivables.

CREDIT RATINGS

Your Company's long term credit ratings have been retained at "AAA" (Highest Degree of Safety) with a "Stable Outlook", by both ICRA and CRISIL. The short-term borrowings (including commercial paper) are rated "A1+" by both ICRA and CRISIL.

Fixed Deposits are rated "AAA" (Highest Credit Quality) by both ICRA and CRISIL.

OUTLOOK

India is expected to remain among the fastest-growing major economies in FY 2026-27, with real GDP growth projected in the range of 6.5-7.0 per cent, supported by resilient domestic consumption, sustained public capital expenditure and a gradual revival in private investment. Inflation is expected to remain within the RBI's tolerance band, fiscal consolidation is progressing, the banking system remains well-capitalised, asset quality trends are favourable, and foreign exchange reserves continue to provide external resilience. Domestic demand drivers are expected to remain broadly intact, with urban consumption, government-led capital formation and improving private sector activity supporting growth. Manufacturing and services should continue to benefit from structural reforms, supply-chain diversification, digital adoption and formalisation, although input-cost pressures and weaker external demand may moderate momentum in some sectors.

The near-term outlook, however, remains subject to material external and supply-side risks. The ongoing conflict in West Asia, together with disruption to shipping routes and the blockage of the Strait of Hormuz, has heightened uncertainty around crude oil prices, freight costs and supply chains. These developments could affect imported inflation, the current account balance, exports, remittance flows and interest-rate expectations, and may also weigh on cost structures and demand conditions in certain MSME segments. In addition, adverse weather conditions, including the possibility of a below-normal monsoon and an El Ni?o event, remain key risks for agricultural output, rural incomes and food inflation.

Taking these factors into account, the Reserve Bank of India's Monetary Policy Committee (MPC) has projected real GDP growth for FY 2026-27 at 6.9 per cent and projected CPI inflation for FY 2026-27 at 4.6 per cent. The outlook remains subject to downside risks arising from geopolitical escalation, supply disruptions and adverse weather conditions, and volatility in international energy and commodity prices.

Overall, the outlook for FY 2026-27 remains one of guarded optimism. While domestic macroeconomic fundamentals remain supportive, the external environment continues to warrant close monitoring. The outlook for the sub-segments of the automotive sector is expected to broadly reflect this macroeconomic context, with growth supported by domestic demand, but moderated by geopolitical and supply-side risks.

Medium, Heavy and Intermediate Commercial Vehicles (MHICV): The MHICV industry is expected to grow in the low single digits in FY 2026-27, following the strong rebound recorded in FY 2025-26. Demand for this segment will remain linked to economic activity and replacement demand, with relatively stronger traction in tippers and buses. Infrastructure, mining and railway activity are expected to

continue to support the segment.

Material Handling and Construction Equipment (MHCE): MHCE demand remains linked to infrastructure

and construction activity. After a contraction of 7 per cent in FY 2025-26, with several equipment segments recording double-digit decline, the industry is expected to recover in FY 2026-27 and record single digit growth.

Retail Commercial Vehicles (Light & Small Commercial Vehicles): The Light and Small Commercial Vehicle (L&SCV)

segment is expected to record steady growth in FY 2026-27, supported by replacement demand, intra-city logistics and essential goods movement. Demand is expected to remain broad-based across urban, semi-urban and select rural markets, with LCVs likely to be the principal contributors to overall CV growth.

Passenger Cars & Utility Vehicles (UVs): The passenger car and utility vehicle market is expected to be supported by steady urban demand and continued preference for personal mobility. Growth is expected to be supported by improving model availability, charging infrastructure and operating economics, though pricing, range confidence and policy clarity remain relevant constraints. The segment is expected to record moderate growth of mid-single digits in FY 2026-27.

Tractors & Farm Equipment (TFE): The TFE segment is expected to record modest growth in FY 2026-27, following two successive years of strong 25-30 per cent growth in

FY 2024-25 & FY 2025-26. Demand is expected to remain supported by replacement demand, mechanisation and rural

financing. The possibility of an El Ni?o event and below-normal monsoon forecast remain key risks, particularly for rain-fed regions. Geopolitical developments may indirectly affect the segment through higher diesel, fertiliser and logistics costs, with implications for farm profitability and rural demand.

INTERNAL FINANCIAL CONTROLS

The Company has a well-established internal financial control and risk management framework to ensure the highest standards of integrity and transparency in its operations and a strong corporate governance structure. Appropriate controls are in place to ensure:

a) the orderly and efficient conduct of business, including adherence to policies;

b) safeguarding of assets; c) prevention and detection of frauds/errors; d) accuracy and completeness of accounting records; and e) timely preparation of reliable financial information.

Additionally, as part of RBI's Risk Based Internal Audit (RBIA) requirement, your Company has adopted appropriate policy and operating guidelines. Along with the Risk Management team and Internal Audit department, the functional and operational risk control matrices have been designed to ensure that adequate controls as may be required are in place and operating effectively and efficiently.

RISK MANAGEMENT

Your Company has built a robust risk governance and risk management framework over the years. The Audit Committee, Risk Management Committee, Asset Liability Management Committee and IT Strategy Committee review and monitor the risks on a regular basis.

The risk management process of the Company is underpinned by a strong and long-standing organisational culture and sound operating procedures involving our Sundaram values, competencies, internal control culture and effective internal reporting.

Your Company has adopted the ERM Framework, which is based on 3 lines of defence:

a. First pillar: Function-heads who are the risk owners and responsible and accountable for assessing, controlling and mitigating risks;

b. Second pillar: Chief Risk Officer and the Risk Management team who assist through facilitating risk awareness, risk reviews, providing analysis and reports including creating a proactive forward-looking view to emerging risks;

c. Third pillar: Internal Auditors and Statutory Auditors who provide assurance to the senior management on risk governance through their assessment of the adequacy and the effectiveness of internal controls and the monitoring mechanisms.

Your Company has a robust first line of defence in the form of sensitised and aware functional teams with deep domain expertise. Active operational engagement on risk management is enabled through two levels of internal teams that review operational risks on an on-going basis:

i) a Functional Working Group on operational risks comprised of 85 operating executives across the Company and

ii) a Core Working Group on Risk Management comprised of 11 functional heads of various departments of the Company. These groups are convened by our second line of defence, the Risk Management department, which ensures meetings on a regular basis to review status on various risks, anticipate emerging risks and define a proactive action plan for containing incipient risk.

The internal audit team reviews the processes and controls to ensure the design effectiveness and to assure adequacy of controls to mitigate risk in line with the RBI's Risk-based Internal Audit (RBIA) framework. Your Company has well-documented standard operating procedures and risk control matrices for all processes to ensure superior control over transaction processing and regulatory compliance. Periodical review of the same ensures that the risks including technology risks are under control. This apart, policies are reviewed and approved by the Board and its Committees that facilitate the review of identification of risks and controls and provide guidance to manage the risks across business that ensures a sustainable and ethical business environment, reflected in our risk management process.

The risk management process fulfils the requirement under Section 134 of the Companies Act, 2013 and Regulation 21, read with Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Above all, your Company's values and culture that are enshrined in the Sundaram Way of doing business and the obligations and commitment to our customers, employees, deposit holders and the community are the foundations on which its risk framework rests.

A few principal financial risks of your Company have been furnished in the Notes to the Accounts under Note No. 38, for your information.

INTERNAL AUDIT

Your Company's internal audit department independently provides the Audit Committee/Board of Directors and the Senior Management a reasonable assurance on the adequacy and effectiveness of internal controls and the risk management framework of the Company. The effectiveness and efficiency of the controls, and the design are regularly measured through process reviews and risk assessment. Your Company has rolled out Risk Based Internal Audit (RBIA) Policy with effect from 1st April 2022 as required by the RBI. The internal audit department reports directly to the Audit Committee of the Board. The Audit Committee regularly reviews the audit

findings as well as the adequacy and effectiveness of the internal control measures.

Audits are conducted encompassing the branch network and all the functional areas at Head office in such a manner that it serves as an important tool of internal control. Additionally, Information Systems audit is carried out by an external professional firm under direct supervision of the Internal Audit Department. Based on the recommendations of the Information Systems Auditor, the Company has implemented a number of control measures both in operational and IT-related areas, apart from information security related measures.

The quality assurance and improvement programme (‘QAIP') of the internal audit function for FY 2025-26 was carried out by an external professional consultant in accordance with the prescribed RBI Guidelines.

INFORMATION TECHNOLOGY

Your Company recognises Information Technology as a critical pillar for running and growing its business. Significant investments continue to be made in strengthening IT infrastructure particularly in the areas of information security and network capabilities. On the applications front, the Company is investing in solutions that enhance the efficiency and performance of front-line staff, improve decision-making through advanced data and analytics, and establish the architectural foundation required for modernisation of its core systems. During the year, the Company also implemented a state–of–the-art Human Resource Management System (HRMS) to further strengthen employee engagement.

Your Company follows a hybrid approach to data centre operations. A modern on premises Data Centre is complemented by a multi vendor cloud environment comprising over 500 servers, delivering an uptime exceeding 99.99 per cent. The on premises Data Centre is certified by TUV Rheinland for compliance with the ISO/IEC 27001:2022 Information Security Management Standard. Together, these facilities support the technological needs of the Company, its subsidiaries, and its associates.

To ensure resilience, a dedicated Disaster Recovery (DR) site is maintained in a separate seismic zone, with near real time replication of all critical applications. Regular DR drills, along with a secure and scalable remote working infrastructure, ensure operational continuity during disruptions. The Company's Cloud strategy continues to focus on achieving an optimal balance of opportunity, risk and cost.

Cyber Security remains an area of sustained and proactive focus. A full time Chief Information Security Officer (CISO) oversees the Company's security posture, supported by continued investments in strengthening detection, response, and recovery capabilities. During the year, enhanced tools and processes were implemented to ensure the reliability, security, and integrity of the Company's systems and data. The Company operates a 24x7 Security Operations Centre (SOC) for real time threat monitoring and alerting. Periodic vulnerability assessments and penetration testing are conducted across applications and infrastructure to validate the effectiveness of established security controls. The Company also engages regularly with external consultants and industry experts to validate its transformation initiatives and reinforce its Information and Cyber Security practices, consistently adopting recognised industry best practices.

Your Company's in-house technology team brings together deep expertise across multiple technologies and strong business & domain knowledge to deliver differentiated digital solutions. Strategic partnerships with select technology specialists help augment internal capabilities with external expertise. Contemporary technology and architecture practices now form the core of the Company's digital capabilities, positioning the Company well to expand and advance its technology landscape. During the year, the Company implemented a Cloud-based Enterprise Data Platform as the foundational element of its Systems of Intelligence layer. Machine Learning and Artificial Intelligence models are increasingly being embedded into business processes, and the Company continues to develop and refine such models to support diverse business functions. The Company has also begun piloting the Agentic framework to apply advanced AI capabilities to real world business use cases.

Working closely with the business functions, the technology team has implemented several process improvements that have reduced turnaround times, enabled straight-through processing, and supported timely decision making. These improvements have been underpinned by reusable digital capabilities, including digitally guided workflows, enterprise task-management tools, a structured communication framework, and embedded Nano Learning modules.

As a relationship centric organisation, your Company continues to focus on creating the right balance of high touch and high tech interactions to deepen customer and stakeholder engagement. The Company's technology priorities remain centred on deploying intelligent solutions that enhance customer service and acquisition, improve employee productivity, reduce cost to serve, expand the use of analytics, and deliver superior customer experiences across all touchpoints.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements, drawn up in accordance with the applicable Accounting Standards, form part of the Annual Report as required by the provisions of Section 129 (3) of the Companies Act, 2013. A separate statement containing the salient features of the financial statements of the Subsidiaries and Joint Venture in Form AOC-I forms part of the Annual Report.

The Consolidated profit after tax is Rs. 2,059 cr. as against

Rs. 1,879 cr. in the previous year, a growth of 9.6 per cent year on year. The total comprehensive income for the year was Rs. 2,134 cr. as against Rs. 2,443 cr. The consolidated net worth for the year stood at Rs. 14,894 cr. as against

` 13,197 cr. in the previous year.

The annual accounts of all the Subsidiaries and Joint Venture have been posted on your Company's website – www.sundaramfinance.in. Detailed information, including the annual accounts of the Subsidiaries and Joint Venture will be available for inspection by the members, through a digital platform which would be provided by the Company. The same will also be made available in physical form to the members upon request.

• Sundaram Home Finance Limited

Sundaram Home Finance Limited, during the year approved loans aggregating to Rs. 6,946 cr. (PY Rs. 6,940 cr.). Disbursements during the year were higher by 4.5 per cent at Rs. 6,830 cr. (PY Rs. 6,534 cr.). The company earned a gross income of Rs. 1,868 cr. (PY Rs. 1,597 cr.) and reported a profit after tax at Rs. 281.88 cr.

(PY Rs. 244.66 cr.). The loan portfolio under management as at 31st March 2026 stood at Rs. 19,909 cr. as against

Rs. 17,428 cr. in the previous year. Gross Stage 3 assets stood at 1.11 per cent (PY 1.02 per cent) and net of ECL provisions stood at 0.51 per cent (PY 0.53 per cent), as at 31st March, 2026. The Net Stage 3 assets, excluding restructured assets, stood at 0.46 per cent as at 31st March 2026. The Board of Directors have recommended a final dividend of Rs. 3.58/- per share (35.77 per cent) for the year ended 31st March 2026. This together with the interim dividend of

Rs. 3.38/- per share (33.83 per cent), would aggregate to a total dividend of Rs. 6.96/- per share (69.60 per cent).

• Sundaram Asset Management Company Limited (On consolidated basis)

The company, along with its subsidiaries reported a consolidated gross income of Rs. 581.40 cr. as against

Rs. 515.75 cr. in the previous year. Consolidated Profit after tax was Rs. 173.60 cr. as compared to Rs. 153.53 cr. during the previous year. The Average Assets under Management amounted to `82,987 cr. for the year 2025-26 as compared to `76,008 cr. in the previous year. The company had declared an interim dividend of `8.22/- per share in the month of January 2026 and has decided to propose a final dividend of `8.34/- per share with the approval of shareholders for the year FY 2025-26.

• Sundaram Trustee Company Limited

Sundaram Trustee Company Limited earned a gross income of Rs. 2.21 cr., as against Rs. 3.64 cr., in the previous year and reported a profit after tax of Rs. 1.08 cr. for the year, as against Rs. 2.23 cr. in the previous year. The company recommended a dividend of Rs. 216/- per share for the year ended 31st March 2026.

• LGF Services Limited

During the year, the company reported a gross income of `0.16 cr. as against `0.19 cr. in the previous year. The profit after tax for the year was `0.09 cr. as against `0.08 cr. in the previous year. The company recommended a dividend of Rs. 3/- (30 per cent) per share for the year.

• Sundaram Fund Services Limited

Sundaram Fund Services Limited earned an income of

`0.08 cr. during the year as against `0.14 cr. in the previous year. The company reported a profit after tax of `0.05 cr. as against `0.03 cr. in the previous year.

Royal Sundaram General Insurance Co. Ltd (Royal Sundaram)

Royal Sundaram reported a Gross Written Premium (GWP) of Rs. 4,638 cr. as compared to Rs. 4,065 cr. in the previous year, representing a growth of 14.1 per cent. The company reported a profit after tax (as per IND AS) of Rs. 107 cr. for the current year as against Rs. 133 cr. in the previous year. The company has paid an interim dividend of `0.55/- per share during the year and recommended a final dividend of `0.25/- per share, aggregating a total dividend of `0.80/- per share for FY 2025-26 (PY `0.90/- per share). The company's solvency ratio as at March 31, 2026 was at 2.21 times (PY 2.20 times) as against the mandated threshold of 1.50 times.

BOARD & AUDIT COMMITTEE

The details regarding number of Board Meetings held during the financial year and composition of Audit Committee are furnished in the Corporate Governance Report. The details of all other Committees are also furnished in the Corporate Governance Report.

DIRECTORS

Mr. Harsha Viji and Mr. Rajiv C. Lochan, Directors, retire by rotation and being eligible, offer themselves for re-election.

KEY MANAGERIAL PERSONNEL

During the year under review, the shareholders of the Company approved the re-appointment of the Whole-time Directors in the following manner:

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each Independent Director of the Company under Section 149 (7) of the Companies Act, 2013 that they meet with the criteria of their Independence laid down in Section 149 (6).

ANNUAL EVALUATION BY THE BOARD

The Board has made a formal evaluation of its own performance and that of its committees and individual Directors as required under Section 134(3)(p) of the Companies Act, 2013.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

2. The Company has selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

3. Proper and sufficient care has been exercised for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. The annual accounts have been prepared on a going concern basis;

5. Adequate internal financial controls have been put in place and they are operating effectively; and

6. Proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

AUDITORS

M/s Brahmayya & Co., Chartered Accountants, Chennai (Regn. No. 000511S) and M/s R.G.N Price & Co., Chartered

Accountants, Chennai (Regn. No. 002785S), have been appointed as Joint Statutory Auditors of your Company, to hold office for a term of three (3) consecutive years from the conclusion of the 71st Annual General Meeting to the conclusion of the 74th Annual General Meeting, in accordance with the Guidelines for Appointment of Statutory Central Auditors (SCAs)/Statutory Auditors (SAs) of Commercial Banks (excluding RRBs), UCBs and NBFCs (including HFCs) issued by the Reserve Bank of India vide their notification dated 27th April 2021 (RBI Guidelines), at such remuneration as may be mutually agreed to between the Board of Directors of the Company and the Joint Statutory Auditors.

ACKNOWLEDGEMENT

Your Directors gratefully acknowledge the support and cooperation extended to your Company by all its customers, depositors, shareholders, and bankers, as also the various mutual funds, insurance companies, automotive manufacturers and dealers, oil marketing companies and other stakeholders.

Your Directors also place on record their special appreciation of Team Sundaram for its dedication and commitment in delivering the highest quality of service to every one of our valued customers.