Dear Shareholders,

The Board of Directors of your Company ("The Board") is delighted to present before you the 15th Annual Report, reflecting Growth, Operational and Financial performance of Aavas Financiers Limited ("the Company" /"Aavas"/ "Your Company") along with the Audited Financial Statements for the Financial Year ended March 31, 2025.

COMPANY OVERVIEW

Your Company is a Housing Finance Company ("HFCs") registered with National Housing Bank ("NHB") regulated & controlled by Reserve Bank of India ("RBI") under the supervision of NHB. Your Company is engaged in providing Home Loans, Home Construction Loans, Loan against Property, and MSMEs business loans to the lower income segment of the society.

The Company specializes in providing home financing solutions to communities that have traditionally been underserved, unserved or overlooked by major financial institutions. Its strategic focus is on catering to the housing needs of low and middle-income groups primarily in semi-urban and rural areas. By doing so, the Company effectively bridges a critical gap in the housing finance landscape and reaches out to a niche market segment that is often neglected by larger financial institutions.

During the Financial Year, the Company has achieved a significant milestone in its journey achieving 20,000 crore in Assets Under Management ("AUM"). This remarkable achievement reaffirms our commitment in providing accessible and affordable housing finance to thousands of families across India.

The Company's live customer count as at March 31, 2025 was 2.08 lakhs. Further, the cumulative loan disbursement since inception as at March 31, 2025 was 34,086.78 crore.

Today, your Company is a pan-India player with 397 branches across 14 states, reinforcing our deep commitment to financial inclusion.

FINANCIAL PERFORMANCE

Major highlights of performance of your Company for the Financial Year ended March 31, 2025 are as under:

The above figures are extracted from the financial statements prepared in accordance with Indian Accounting Standards ("Ind AS") as notified under Sections 129 and 133 of the Companies Act, 2013 ("the Act") read with the Companies (Accounts) Rules, 2014 and other relevant provisions of the Act. The detailed Audited Financial Statements as stated above are presented as a separate section of this Annual Report.

The key financial performance indicators for the Financial Year under review are as follows:

Total Income, Profit Before Tax ("PBT"), Profit After Tax ("PAT") of your Company:

Total Income for the Financial Year 2024-25 increased to 2,358.42 crore as compared to 2,020.30 crore in the previous Financial Year.

During the year, the Company has earned PBT of 732.59 crore as compared to 624.45 crore in the previous Financial Year, and the PAT during the year was 574.11 crore as compared to 490.69 crore in the previous Financial Year, recording an increase of 17%.

The AUM of your Company stood at 20,420.18 crore (including assignment and PTC of 4,423.48 crore) as at March 31, 2025 as against 17,312.65 crore (including assignment of 3,722.72 crore) in the previous Financial Year, with a growth of 18%.

Furthermore, during Financial Year under review, there were no alterations/changes in the core operations or activities or nature of business of the Company.

DIVIDEND

Considering the capital-intensive nature of the business, the business plan of the Company and with a view to plough back the profits, the Board has not recommended dividend for consideration of the members at the ensuing Annual General Meeting (‘AGM') in order to build a strong base for its long-term growth.

In compliance with the Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("SEBI (LODR) Regulations, 2015"), the RBI Master Direction (Non-Banking Financial Company Scale Based Regulation) Directions, 2023 and Master Direction Non-Banking Financial Company Housing Finance Company (Reserve Bank) Directions, 2021 ("RBI

Master Directions") the Board of Directors of the Company has formulated and adopted the Dividend Distribution Policy. The Policy is available on the website of the Company at link https:// www.aavas.in/img/pdf/dividend-distribution-policy.pdf. and forms part of this Annual Report as ‘Annexure-5'.

Authorized Capital

During the Financial Year under review, there has been no change in the Authorized Capital of the Company. Your Company's Authorized Capital is set as 85,00,00,000/- (Rupees eighty five crore only) divided into 8,50,00,000 (Eight crore fifty lakhs) Equity Shares of 10/-(Rupees ten only) each.

Issued, Subscribed & Paid up Capital

During the Financial Year under review, the Company allotted 13,960 (Thirteen thousand nine hundred and sixty only) Equity Shares of face value of 10/- (Rupees ten only) each pursuant to exercise of employee stock options by the eligible employees of the Company under Equity Stock Option Plans ("ESOPs") and Performance Stock Option Plans ("PSOPs") of the Company.

Pursuant to the aforesaid allotment of Equity Shares, the issued, subscribed and paid-up share capital of the Company as on March 31, 2025, stands increased to 79,15,36,650/-(Rupees seventy nine crore fifteen lakhs thirty six thousand six hundred and fifty only) divided into 7,91,53,665 (seven crore ninety one lakhs fifty three thousand six hundred and sixty five) Equity Shares of Face Value 10/- (Rupees ten only) each.

The shares of the Company are actively traded on BSE Limited

("BSE") and National Stock Exchange of India Limited ("NSE") and have not been suspended from trading.

Debentures

Details of Secured Debt Securities as on March 31, 2025:

TRANSFER TO SPECIAL RESERVE (UNDER SECTION 29C OF THE NATIONAL HOUSING BANK ("NHB") ACT, 1987)

Under Section 29C of the National Housing Bank Act, 1987,

Housing Finance Companies ("HFCs") are required to transfer a sum not less than 20% of their net profit every year to their reserve fund before declaration of any dividend. Your Company has transferred a sum of 114.87 crore, to reserve fund, which is 20% of its net profit.

OPERATIONS OF THE COMPANY

In the realm of housing finance sector in India, your renowned Company remains steadfast, with a mission focused on addressing the swiftly increasing demand for housing loans. With a strong commitment to growth together with our customers, we have established a path of ongoing expansion, strategically reaching various regions.

During the Financial Year under review, our presence extended gracefully across 14 states, featuring 397 branches that serve as beacons of financial empowerment.

As we have opted significant for alternative path with objective, unlike many others in our industry who focus on metropolis and urban cities, our focus is on the suburban and rural regions of India, where individuals from lower to middle-income backgrounds have a strong desire to achieve homeownership. In these locales, characterized by lush fields and developing communities, we are driven by a profound commitment to enhance people's lives through the provision of housing.

Your Company aims to empower and upgrade the lives of low and middle income customers by providing them accessible home loans and setting pioneering benchmarks in unserved and underserved markets.

Details regarding the operations of the Company and its state of affairs are covered in the ‘Management Discussion and Analysis Report' forming part of this Annual Report.

During the Financial Year under review, your Company has demonstrated impressive and robust performance, as highlightedbythefinancial summary as below.

Income & Profits

The Company witnessed an impressive surge in Total Income by 16.74% to 2,358.42 crore for the Financial Year ended March 31, 2025 as compared to 2,020.30 crore for the previous Financial Year.

PBT was 17% higher at 732.59 crore as compared to 624.45 crore for the previous Financial Year and PAT was 17% higher at 574.11 crore as compared to 490.69 crore for the previous Financial Year.

Sanctions

Throughout the Financial Year 2024-25, your Company has sanctioned housing loans for 6,240.53 crore as compared to 5,670.66 crore in the previous Financial Year, with an annual growth of 10 %.

Since the inception of your Company, the cumulative loan sanctions reached at 35,301.25 crore as at March 31, 2025 and the Company has not granted any loan against the collateral of Gold Jewellery and loan against Shares during the year under review.

Disbursements

The total housing loan disbursement reached at 6,123.01 crore as compared to 5,582.23 crore in the previous Financial Year registering an annual growth of 10%.

The cumulative loan disbursement since inception as at March 31, 2025 was 34,086.78 crore.

Assets Under Management ("AUM") stability of the Company and serves AUM as a key indicator of its growth and revenue potential.

The AUM of your Company stood at 20,420.18 crore (including assignment and PTC of 4,423.48 crore) as at March 31, 2025 as against 17,312.65 crore (including assignment of 3,722.72 crore) in the previous Financial Year, with a growth of 18%.

As at March 31, 2025, the average size of loan sanctioned was 9.68 lakhs and average tenure was 194.9 months in the AUM (on origination basis).

Capital Strength and Liquidity Position

The Company's total Capital Adequacy was recorded at 44.50% (previous Financial Year 43.98%) significantly exceeding the minimum threshold of 15% mandated by the RBI Master Directions showing strong position of the Company.

Additionally, as of March 31, 2025, the Company's Liquidity Coverage Ratio ("LCR") was 128.12% which is well above the regulatory requirement of 85%.

Non-Performing Assets ("NPA")

Your Company complies with the Indian Accounting Standards ("Ind AS") regarding the calculation of Stage-3 Assets ("NPA"). The classification of the Company's assets is based on expected performance. Exposure at Default ("EAD") represents the total outstanding amount, including accrued interest, as of the reporting date.

Thorough monitoring, early warning signals and instant actions enable the Company to maintain its portfolio quality. The Gross Non-Performing Assets ("GNPA") and Net Non-Performing Assets ("NNPA") as on March 31, 2025, were recorded at 1.08% and 0.73% respectively, compared to 0.94% and 0.67% in the previous Financial Year.

Credit Rating

The financial prudence and discipline of the Company is demonstrated in the Credit Ratings assigned by Credit Rating Agencies as under:

For more details on credit ratings, kindly visit to website of the Company at https://www.aavas.in/investor-relations/credit-rating.

Environmental, Social, and Governance ("ESG") Rating

The Company has garnered notable recognition in the field of ESG practices, demonstrating its steadfast dedication to sustainability. The Company consecutively received the acclaimed ‘Best Mid-Cap-Service Sector Award' at the Sustainability Reporting Awards, hosted by the Institute of Chartered Accountants of India ("ICAI") for Excellence in Business Responsibility and Sustainability Reporting ("BRSR"). The Company's ESG ratings further illustrate its strong performance and commitment to sustainability metrics:

The Company has not engaged with any ESG Rating Provider for rating. They have independently assigned the rating to the Company based on the Financial Year 2023-24 disclosures and other publicly available data. For more details on ESG ratings, kindly visit to website of the Company at https://www.aavas.in/ esg-ratings.

REGULATORY & STATUTORY COMPLIANCES

In line with its commitment to ethical governance and transparent operations, the Company accords utmost importance to compliance with all applicable regulatory and statutory requirements. It operates within a well-defined compliance framework that ensures adherence to all relevant laws, rules and standards.

Your Company ensures strict adherence to all relevant guidelines, circulars, notifications and directions issued by our Regulators which includes but not limited to Reserve Bank of India ("RBI"), National Housing Bank ("NHB"), Ministry of

Corporate Affairs ("MCA"), Securities and Exchange Board of India ("SEBI"), Insurance Regulatory and Development Authority of India ("IRDAI"), BSE and NSE from time to time. These guidelines, circulars, notifications and directions are also presented to the Board in the form of regulatory updates to keep the Board informed and report on actions initiated on the same. The Company also complies with the provisions of the Companies Act 2013, Secretarial Standards issued by the Institute of Company Secretaries of India ("ICSI") and as notified by Ministry of Corporate Affairs from time to time.

Further, the Company aligns itself with key regulatory frameworks such as the Ministry of Corporate Affairs' notifications, the RBI Master Directions Non-Banking Financial Company (Housing Finance Company) Directions, 2021, the RBI Master Direction (Non-Banking Financial Company Scale Based Regulation) Directions, 2023, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021, the Income Tax Act, 1961 and Goods and Services Tax Act (GST). In addition, the Company diligently observes all other applicable statutory and regulatory requirements to maintain robust compliance and governance standards.

Compliance with Directions/ Guidelines of Reserve Bank of India ("RBI")/ National Housing Bank ("NHB")/ and other statutes

Your Company has complied with the Master Direction Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021. Your Company is adhering to all the instructions, guidelines and circulars issued by RBI during the year on various matters such as Key Fact Statement for Loans and Advances, strengthening of customer service rendered by

Credit Information Companies and Credit Institutions, Know Your Customer ("KYC") Guidelines, Fraud Risk Management, Guidelines on Prevention of financial frauds perpetrated using voice calls and SMS Regulatory prescriptions and Institutional Safeguards in Housing Finance Companies, which were duly implemented by the Company including formation of policies, implementing procedures and to review their outcome on periodic basis.

Further, the RBI had issued various Master Direction during the year including Master Direction on Fraud Risk Management dated July 15, 2024, Master Direction on Treatment of Wilful Defaulters and Large Defaulters dated July 30, 2024 and Master Direction on Reserve Bank of India (Credit Information Reporting) Directions, 2025 dated January 06, 2025. Your Company has duly implemented and adopted the said directions ensuring its compliance.

As per various circulars on Returns to be submitted by HFCs and various Circulars/ Guidelines/Notifications issued by NHB, your Company has duly complied and submitted all the required monthly/ quarterly/ half yearly NHB reports/ returns, intimation of opening/ closing (shifting/ relocation) of branches within prescribed time-limit during the Financial Year 2024-25.

Insurance Regulatory and Development Authority of India ("IRDAI") Compliance

The Company is registered with the IRDAI as a Corporate Agent for carrying on the Insurance Agency Business and has complied with the applicable requirements under Insurance Regulatory and Development Act, 1999 and IRDAI (Registration of Corporate Agent) Regulations 2015, as amended from time to time. Being an insurance intermediary, Company is maintaining all the required information as per IRDAI rules.

The Company's Certificate of Registration to act as Corporate Agent (Composite) was renewed with validity of three years from December 08, 2023 to December 07, 2026.

DEPOSITS

Your Company being a non-deposit-taking Housing Finance Company has not solicited, accepted or renewed any amount falling within the purview of provisions of Section 73 of the Companies Act, 2013 ("Act") read with the Companies (Acceptance of Deposit) Rules, 2014 during the Financial Year under review. Hence, the requirement for furnishing the details relating to deposits covered under Chapter V of the Act and in terms of RBI Master Directions- Non-Banking Financial Company (Housing Finance Company) Directions, 2021 is not required.

AWARDS AND RECOGNITION

Honored with Best Mid-Cap Service Sector Award in the Sustainability Reporting Awards 2023-24 by the Institute of Chartered Accountants of India ("ICAI") for Excellence in Business Responsibility and Sustainability Reporting

("BRSR") at IICC, New Delhi.

Honored with ET NOW Best BFSI Brands 2025 Award.

Honored with Best Annual Report 2024 by The Free Press Journal in the category of Finance-Housing.

Honored with Product Innovation by National Housing Bank in Housing & Housing Finance Excellence Awards 2025.

ENROLLMENT IN GOVERNMENT SCHEMES

The Company has entered into a Memorandum of Understanding (MoU) with National Housing bank on November 05, 2024, to participate in the Interest Subsidy Scheme under Pradhan Mantri Awas Yojana - Urban 2.0 (PMAY-U 2.0) for claiming subsidy on home loans taken by eligible urban poor for acquisition, construction of house, thereby enabling beneficiaries to access affordable housing with financial relief and improved home ownership opportunities.

During the year, your Company has also registered under "Credit

Risk Guarantee Fund Trust for Low Income Housing Scheme ("CRGFTLIH Scheme")" as member lending institution to avail guarantee facility under the CRGFTLIH Scheme.

RESOURCE MOBILIZATION

In alignment with the long-term strategic objectives, your Company has established a comprehensive borrowing policy framework to ensure prudent and efficient management of its funding requirements. The key objective of this framework is to maintain a diversified liability profile and reduce concentration risk by limiting excessive reliance on any single lender or financial instrument.

Your Company continues to engage with a broad spectrum of lenders and Financial Institutions, including Public Sector Banks, Private Sector Banks, NHB, Mutual Funds, SIDBI, Multilateral Institutions and other financial institutions.

This diversifiedlender base enables the Company to optimise al flexibility. financi thecostoffundsandenhance

In accordance with Section 180(1)(c) of the Companies Act, 2013, the Shareholders of the Company, through a Special Resolution passed on August 7, 2024, authorized the Board of Directors (deemed to include Executive Committee of the

Board) to borrow monies, apart from temporary loans obtained from the Company's bankers in the ordinary course of business, in excess of the paid-up share capital, securities premium and free reserves of the Company, subject to an overall borrowing limit of 27,000 crore (Rupees twenty seven thousand crore only).

The Key highlights of your Company's borrowing and liquidity positions as on March 31, 2025 are mentioned below:

Weighted Average Borrowing Cost as at March 31, 2025 was 8.24% (including Securitization/ Assignment) as against 8.07% as at the end of the previous Financial Year.

The Company's sources of funding were primarily in the form of Long Term Loans from Banks and Financial Institutions (51%), followed by Securitization/Direct assignment (25%), NHB Refinance (14%), Debt capital market (10%).

The Company maintained a comfortable liquidity position as on March 31, 2025 with 1559.63 crore (including FD's).

The Liquidity Coverage Ratio ("LCR") for the Financial Year ended March 31, 2025 was 128.12% against the regulatory requirement of 85%.

Term Loans from Banks and Financial Institutions

The Company, during the Financial Year, received aggregate fresh loan sanctions amounting to 3,940 crore and has availed loans aggregating to 3,515 crore. The outstanding term loans from Banks and Financial Institutions as at March 31, 2025 were 9,124 crore (excluding PTC & CC) with average tenure of around 9 years. om National Housing Bank ("NHB") Co-Lending/Securitization/Assignment of Loan Portfolio

Your Company has actively tapped co-lending/ Securitization/ Direct Assignment market, which has enabled it to create liquidity, diversify liability profile and minimizing asset liability mismatches.

During the year under review, your Company received purchase consideration of 1,523 crore from assets assigned under transfer of loan portfolio transactions and raised 101 crore through co-lending of loan portfolio.

The transfer of loan portfolio and co-lending transactions were carried out in line with RBI guidelines and these assets were de-recognized in the books of the Company.

Refinance

As on March 31,2025, total outstanding balance of from NHB stood at around 2,577 crore.

Non-Convertible Debentures (NCDs)

Your Company has raised long term funding through issuance of debt securities not only to the Domestic Financial Institution ("FI") but also to Multilateral/Development Financial Institutions ("DFI") and Scheduled Commercial Bank ("SCB") in India. During the year under review, your Company has raised 830 crore through issuance of debt securities and as on March

31, 2025, the Company's outstanding NCDs stood at around 1,317 crore [FI 23 % ;DFI 65 % and SCB- 12 % ] as compared to 945 crore [FI 10 % ;DFI - 66 % and SCB- 24 %] as on March 31, 2024.

Your Company has not issued any Commercial Paper & Short Term Instrument during the Financial Year 2024-25 and as on March 31, 2025, the Company's Commercial Paper outstanding is NIL.

Rupee Denominated External Commercial Borrowing

As on March 31, 2025 the outstanding balance of Rupee Denominated External Commercial Bond stood at 410.96 crore (including outstanding balance of social masala bond of

360.86 crore).

Further, the interest on NCDs and Masala Bonds issued on private placement basis were paid by the Company on their respective due dates and there was no instance of interest amount not claimed by the investors or not paid by the Company.

Your Company, being listed HFC, is exempted from the requirement of creating Debenture Redemption Reserve ("DRR") on privately placed debentures. Therefore, your Company has not created DRR. Further the requirement to invest or deposit a sum of not less than 15% of the amount of debentures which are maturing during the Financial Year ending on March 31 of the next year as provided under Rule 18 of the Companies (Share

Capital and Debentures) Rules, 2014 has been done away for listed Companies vide notification of MCA dated June 05, 2020.

TRUSTEE TO SECURITIES HOLDERS

In compliance to the requirements of Securities and Exchange

Board of India (Issue and Listing of Non- Convertible Securities) Regulation 2021, the Company has appointed IDBI Trusteeship

Services Limited as Debenture Trustee to protect the interest of the debenture holders of the Company.

The details of Debenture Trustee are available on the Company's website at https://www.aavas.in/details-of-debenture-trustee-rta-and-grievance. Further, the details of Debenture Trustee is also provided at corporate information section, of this

Annual Report.

BRANCH BUILD-UP

A strong branch network forms the backbone of the Company's effectively at the operations, enabling it to serve customers grassroots level. Each branch acts as a strategic touchpoint, driving business growth and fostering closer engagement with local communities. By expanding the physical presence, the

Company continues to strengthen its reach, improve customer access and tap into emerging markets across India.

As on March 31, 2025, the Company is operating in 14 states, with a network of 397 branches, consisting of Rajasthan, Gujarat, Maharashtra, Madhya Pradesh, Delhi, Uttar Pradesh, Haryana, Chhattisgarh, Uttarakhand, Himachal Pradesh, Punjab, Odisha, Karnataka and Tamil Nadu. The Company added 30 new branches during the Financial Year 2024-25.

Your Company has its Registered Office in Jaipur, Rajasthan and its branch network as on March 31, 2025 vis-a-vis the previous Financial Year are detailed hereunder:

PERSONNEL

Your Company's Board of Directors is committed in upholding the highest standards of integrity, which serve as the cornerstone of the Company's governance framework.

The Board of Directors of the Company is a panel of members having diverse set of competencies, demonstrated experience, personal integrity, ethics, and Governance expertise. In addition to possessing relevant skills, Directors exhibit leadership qualities that contribute to the effective stewardship of the organization.

In accordance with Section 149 of the Act, Regulation 17 of SEBI (LODR) Regulations, 2015 and the RBI Master Direction (Non-Banking Financial Company Scale Based Regulation) Directions, 2023 as amended from time to time, your Company has optimum mix of Executive, Non-Executive and Independent Directors.

The Board assumes a critical role in overseeing management operations and ensuring alignment with the short-term and long-term interests of stakeholders. This belief is reflected Aavas governance practices, under which the Company strives to maintain an effective, informed and independent Board.

The members of the Company's Board of Directors are eminent persons of proven competence and integrity. Non-Executive Directors, including Independent Directors, play a critical role in imparting value to the Board processes by bringing an independent judgment in the areas of strategy, performance, resource management, financial reporting, the overall standard of Company's conducts etc.

The Board has identifiedthe core competencies (like Accounting & Finance, Legal & Compliance, Strategic Development & Execution, Governance Board Role etc.) and some specialized skills as essential for the effective functioning of the Company as a Non-Banking Financial Company ("NBFC") and Housing Finance Company.

The Board of the Company comprises of 9 (Nine) Directors, comprising 3 (Three) Non-Executive Independent Directors (including 2 (Two) Women Directors), 5 (Five) Non-Executive Nominee Directors and 1 (One) Executive Director-Managing Director & Chief Executive Officer as on March 31, 2025 who build strong foundation in business principles and leadership.

The Composition of Board of Directors and Key Managerial

Personnel of the Company is as follows:

BOARD OF DIRECTORS

The Composition of the Board of the Company as on March 31, 2025 is given below:

*Appointed as an Additional Director w.e.f. May 21, 2024 and appointed as Promoter Nominee Non-Executive Director w.e.f. August 07, 2024 in place of Mr. Kartikeya Dhruv Kaji who has resigned w.e.f May 21, 2024.

After the end of Financial Year 2024-25 and up to June 30, 2025, pursuant to purchase of shares under the separate share sale agreements entered into by each of (i) Lake District Holdings Limited ("LDHL"), promoter of the Company till June 30, 2025 (ii) Partners Group ESCL Limited ("PGEL"), promoter of the Company till June 30, 2025 & (iii) Partners Group Private Equity (Master Fund), LLC ("PGPE"), member of the promoter group of the Company till June 30, 2025 (LDHL, PGEL and PGPE collectively referred as ‘Sellers'), with the Company and Aquilo House Pte. Ltd. (‘Purchaser') on August 10, 2024 (collectively, the "SPAs"), the Purchaser has acquired an aggregate of

2,09,49,112 equity shares of the Company representing 26.47% of paid-up share capital of the Company as on June 30, 2025. For the sake of completeness, please note om June 30, 2025. that as on March

31, 2025, the Purchaser held 17,808,116 equity shares of the Company representing 22.50% of the share capital of the Company, acquired on March 21, 2025 pursuant to an open offer announced by the Purchaser vide public announcement dated

August 10, 2024 in accordance with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers Regulations), 2011.

Pursuant to the above, the Sellers and other members of the promoter group have ceased to be the promoters and members of the promoter group of the Company, and are not in control of the Company; and the Purchaser has acquired control of the Company, and stands reclassifiedas a ‘promoter' of the Company,ineachcasewitheffect

Pursuant to completion of the transactions contemplated in the SPAs, the 5 (five) Non-Executive Directors nominated by the Sellers resigned with effectfrom June 30, 2025, and 5 (five) Additional Non-Executive Non-Independent Directors nominated by the Purchaser, the new promoter, were appointed by the Board of Directors subject to approval of the members of the Company, with effect from June 30, 2025, detailed as under:

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to the provisions of Section 2(51) and 203 of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, the following are the Key Managerial Personnel of the Company:

* In compliance with advisory issued by National Housing Bank vide letter MRO/DOS/DAK/2024/03875 dated December 13, 2024, regarding separation of the role of Company Secretary and Chief Compliance Officer. Mr. Sharad Pathak resigned from the post of Company Secretary and Compliance Officer, w.e.f. closing hours of January 30, 2025 and continues to hold the office as Chief Compliance Officer and Mr. Saurabh Sharma was appointed as the Company Secretary and Compliance Officer w.e.f. January 31, 2025.

APPOINTMENT & RESIGNATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the Financial Year under review and up to the date of this report, the Company has witnessed changes in its Board composition and KMP structure in accordance with corporate governance requirements and business imperatives. The appointments, resignations, and reconstitutions have been undertaken to strengthen leadership, align with regulatory directives, and enhance operational efficiencies.

DECLARATION BY INDEPENDENT DIRECTOR

In accordance with the provisions of the Section 149(6) of the Act and Regulation 16(1)(b) & 25 of SEBI (LODR) Regulations, 2015, the Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence for Independent Directors.

The Board affirms that the Independent Directors fulfill the aforesaid criteria and possess requisite integrity, qualifications, proficiency, experience, expertise and are independent of the management.

The names of all the Independent Directors of the Company have been included in the Independent Director's databank maintained by Indian Institute of Corporate Affairs ("IICA"). None of the Directors have any pecuniary relationship or transactions with the Company.

CERTIFICATE OF NON- DISQUALIFICATION OF DIRECTORS

The Board of Directors hereby affirms that none of its are disqualified from being appointed as Directors in with the provisions of Section 164 of the Act. Further, no Director has been debarred from holding the office of Directors by virtue of any SEBI order or any other such authority. None of the Directors of the Company are related to each other.

In support of the above, a certificate from a Company in practice has been obtained confirming that none of the

Directors on the Board of the Company have been debarred or disqualifiedfrom being appointed or continuing as Directors of Company by SEBI / MCA or any such statutory authority. The same forms part of this Annual Report as ‘Annexure-1'.

DISCLOSURE UNDER SECTION 197(14) OF THE COMPANIES ACT, 2013

The Managing Director and CEO of the Company has not received any commission from its Subsidiary Company.

BOARD MEETINGS

The Company ensures compliance with Corporate Governance best practices by convening a minimum of 4 (Four) Board meetings annually, with 1 (One) meeting held in each quarter. The schedule for these meetings is determined well in advance, following due consultation and concurrence of all Directors.

Decisions requiring immediate attention and matters of urgency, approved via circular resolutions, are subsequently presented to and duly noted at the next scheduled Board meeting to ensure transparency and accountability in governance.

During the Financial Year under review, the Board convened and conducted 7 (seven) meetings. The attendance details of individual Directors at these meetings are comprehensively documented in the Corporate Governance Report and therefore are not reiterated here to prevent redundancy in reporting.

PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

The Board of Directors plays a crucial role in propelling success of the Company and Board Evaluation is the essential process that allows the Board to recognize and tackle challenges related to Corporate Governance, thereby increasing the overall value of the organization. A thorough and effective Board Evaluation plays a crucial role in enhancing performance at both the organizational board level and individual level.

In accordance with the criteria set forth in the Act and the SEBI (LODR) Regulations 2015, the Board of Directors has conducted an annual assessment of its performance, along with that of its Committees and Individual Directors. The Board, in consultation with its Nomination and Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its

Committees and Individual Directors, including Independent Directors, which is in compliance with the applicable provisions of the Act and the SEBI (LODR) Regulations, 2015.

Further, the Board oversees, evaluates, and revises the framework in collaboration with the Nomination and Remuneration Committee, as necessary and in response to new compliance obligations.

The Board Evaluation process is carried out through a web based platform called ‘Goveva', which streamlines the process, boosts operational efficiency and automates report generation.

The comprehensive evaluation process for the Board, its

Committees, and individual Directors, including Independent Directors, is outlined in the Corporate Governance Report, which is the part of this Report.

SEPERATE INDEPENDENT DIRECTORS' MEETINGS

During the Financial Year under review, a seperate meeting of Independent Directors was convened on March 05, 2025 in strict adherence to regulatory requirements. This meeting was held without the participation of Non-Independent Directors or members of the Company's Management, thereby ensuring an environment conducive to independent deliberation and oversight.

The Independent Directors, in the course of this meeting, reviewed and discussed various matters arising from Committee meetings and Board deliberations. Their discussions encompassed, inter alia, the assessment of the quality, adequacy, and timelines of information flow between the Company's Management and the Board, ensuring that the Board is equipped with all necessary data and insights to effectively discharge its fiduciary and governance responsibilities.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

In our dedication to uphold strong governance practices, your Company has in place a system of conducting the familiarization programmes for Independent Directors in view of adherence with the expected obligations and responsibilities of Independent Directors as prescribed under the Regulation 25(7) of the SEBI (LODR) Regulations, 2015. As per the Programme, Independent Directors are acquainted with their roles, rights, responsibilities, and the nature and business model of the

Company upon their induction.

The Programme is designed to provide a conceptual framework aligned with contemporary expectations, mandating that Independent Directors comply with a code of ethics and integrity to fulfil their responsibilities in a professional and trustworthy manner, thereby fostering confidence within the investment community. The objective of this program is to educate Independent Directors about their rights and obligations, as well as to familiarize them with the regulatory landscape and the business model under which the Company operates.

The induction and continuous training programs empower the Board, including Independent Directors to make well-informed and deliberate decisions that align with the best interests of the Company's stakeholders.

The specifics of the Familiarization Programme have hosted on the Company's website and can be accessed at https://www.aavas.in/codes-and-policies.

POLICY ON DIRECTOR'S APPOINTMENT, REMUNERATION & OTHER DETAILS

In pursuit of building a capable and visionary leadership team, the Company has laid down a comprehensive Nomination and

Remuneration Policy for the selection, compensation and, governance of its Directors, Key Managerial Personnel ("KMP"), and Senior Managerial Personnel("SMP"). This Policy emphasizes ethical conduct, professional merit, and organizational fit, ensuring that individuals appointed to critical roles bring value through their competence and insight. The policy also promotes transparency in the nomination process, reinforcing the Company's commitment to responsible leadership.

The Policy has been formulated in accordance with the Section 178 of the Act, provisions of Regulation 19 of SEBI (LODR) Regulations, 2015 and Guidelines on Compensation of Key Managerial Personnel and Senior Management in NBFCs issued by RBI vide circular dated RBI/2022-23/36 DOR.GOV.REC. No.29/18.10.002/2022-23 on April 29, 2022 ("RBI Guidelines"), as amended from time to time.

The Policy is available on the website of the Company and can be accessed at https://www.aavas.in/codes-and-policies and all the details of remuneration paid to the Directors is mentioned in Annual Return in form MGT-7, available on Company's website and can be accessed at https://www.aavas.in/investor-relations/annual-reports. been

BOARD COMMITTEES

In accordance with statutory requirements, the Company has following 9 (Nine) Board level Committees, these Committees have been constitutedtoensureeffective oversight, strategic decision-making, and regulatory compliance, in alignment with the provisions of applicable laws and statutes:

During the Financial Year under review, the Board accepted all recommendations made by the above Committees.

The details with respect to the composition, terms of reference, number of Meetings held, Committees as on March 31, 2025 are given in the Report on Corporate Governance, which forms part of this Annual Report as ‘Annexure-2'.

EMPLOYEE STOCK OPTION PLAN

Employee Stock Option Plan serve as a strategic instrument to attract, retain and reward talented employees. Beyond fostering motivation and encouraging long-term commitment, It align employees interest with the Company's objectives, thereby enhancing a sense of belonging and driving sustained organizational success.

EQUITY STOCK OPTION PLAN (ESOP) 2016-I (e)

During the Financial Year under review, the Company made grant aggregating to 89,500 options on October 15, 2024 under ESOP-2016-I (e).

PERFORMANCE STOCK OPTION PLAN ("PSOP-2023")

During the Financial Year under review, the Company made grant aggregating to 1,22,139 options on October 15, 2024, 5,256 options on October 18, 2024 and 23,904 options on December 12, 2024 under the PSOP-2023.

PERFORMANCE STOCK OPTION PLAN ("PSOP-2024")

The Company believes that equity-based compensation schemes/plans are an effective tool to reward the talent working with the Company for delivering long-term sustainable performance and creation of stakeholder value. With a view to drive long term performance, retain talent and attract new talent, the Company formulated and implemented ‘Aavas

Financiers Limited - Performance Stock Option Plan- 2024' ("PSOP-2024") as a key component in its reward structure to the eligible employees of the Company. The PSOP-2024 was approved by the Shareholders in Annual General Meeting held on August 07, 2024.

During the Financial Year under review, the Company made grant aggregating to 4,00,000 options on January 30, 2025 under the PSOP 2024.

Following are the existing ESOP and PSOP plans of the Company:

It is confirmed that all the ESOP & PSOP Schemes of the Company are in compliance with the provisions of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SEBI SBEB and Sweat Equity Regulations") as amended from time to time.

The Nomination & Remuneration Committee administers and monitors the ESOP & PSOP Schemes in compliance with the Act, SEBI SBEB and Sweat Equity Regulations, 2021 and SEBI (LODR) Regulations, 2015.

The Secretarial Auditors of the Company has given a Certificate, confirming that the above ESOP & PSOP Schemes have been implemented in accordance with the SEBI SBEB and Sweat Equity Regulations, 2021 as amended from time to time. Such ESOP & PSOP Schemes will be available for the inspection of the Members of the Company.

The applicable disclosures as stipulated under Regulation 14 of SEBI SBEB and Sweat Equity Regulations, 2021, with regard to ESOP & PSOP Plan of the Company are available on the website of the Company at https://www.aavas.in/investor-relations/ annual-reports.

Statutory Auditors and Auditors' Report

In terms of provisions of Section 139 of the Act, read with the Companies (Audit and Auditors) Rules, 2014 and RBI Guidelines for appointment of Statutory Auditor(s), M/s. M S K A & Associates Chartered Accountants (Firm Registration No. 105047W) and M/s. Borkar & Muzumdar, Chartered Accountants (Firm Registration No. 101569W) were appointed as the Joint Statutory Auditors of the Company by the members of the Company for a period of 3 (Three) consecutive years in the 14th AGM held on August 07, 2024 effective from the conclusion of 14th AGM until the conclusion of 17th AGM.

The Audit Report given by the Joint Statutory Auditors on the financial statements of the Company is part of this Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report.

The Audit Committee and the Board of Directors also took note of the eligibility certificate received from both the audit firms that they are not disqualified and are eligible to hold the office Auditors of the Company. Further, during the year under review, the Auditors have not reported any fraud under Section 143(12) of the Companies Act, 2013.

Secretarial Auditors and Secretarial Audit Report

M/s. Chandrasekaran Associates, Company Secretaries (Firm Registration No. P1988DE002500), have carried out Secretarial Audit of the Company for the Financial Year 2024-25 in accordance with the provisions of Section 204 of the Act read with the rules made thereunder.

In accordance with provisions of Sub-section (1) of Section 204 of the Act, the Secretarial Audit Report in form MR-3, is furnished as 'Annexure-3', which forms part of this Annual Report.

The Report of Secretarial Auditors is self-explanatory and there has been no observations or qualifications or adverse remarks in their Report.

Furthermore, M/s. Chandrasekaran Associates, Company

Secretaries has issued an Annual Secretarial Compliance

Report for the Financial Year 2024-2025 in compliance with Regulation 24A of SEBI (LODR) Regulation, 2015 which forms part of this report as ‘Annexure-4' and is also submitted to the Stock Exchanges. There are no observations, or qualifications or adverse remarks in their Report.

Pursuant to the amendments made in SEBI Regulations i.e., SEBI (Listing Obligations & Disclosure Requirements) (Third Amendment) Regulations, 2024 and pursuant to SEBI Circular No. SEBI/HO/CFD/CFD-PoD-2/CIR/P/2024/185 dated December 31, 2024, the Company shall appoint Secretarial Auditor for a term of 5 years (the earlier term served shall not be considered for this term) with recommendation of Board and Shareholders approval in its Annual General Meeting.

Consequently, in accordance with, Section 204 of the Act, the Board of Directors, has recommended the appointment of M/s. Chandrasekaran Associates, (Firm Registration No. P1988DE002500) Company Secretaries as Secretarial Auditors of the Company for a period of 5 (Five) consecutive Years effective from FY 2025-26 upto FY 2029-30, to the Shareholders of the Company for their approval.

The Company has obtained consent and eligibility certificate from the above audit firm under applicable rules and laws that as they are not disqualifiedand are eligible to hold the office Secretarial Auditors of the Company, if appointed.

INFORMATION SYSTEM AUDIT ("IS AUDIT")

The landscape around information systems has been changing, therefore an IS audit focuses on the governance and management aspects of technology and cybersecurity as much as it does on specific focus areas of the audit. as

The Company has in place an IS Audit Policy which is cognizant of business imperatives and is aligned with the aspirations of the organization, including being agile and innovative and adopting technologies at a rapid pace. Our Head of Internal Audit ("HIA") is accountable to the Audit Committee and Management in providing assurance on the adequacy and effectiveness of the Company's risk management, control, and governance of information system processes used for controlling its activities and managing its significant risks and also report material frauds and their investigations and corrective actions.

INTERNAL AUDIT & INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY

The Company has in place Risk Based Internal Audit Framework ("RBIA") in compliance with directive issued by Reserve Bank of India. The Company has developed an in-house audit team and appointed HIA to oversee the audit of functional areas and operations.

The Internal Audit department is headed by the HIA who reports directly to the Audit Committee of the Board. The primary responsibility of the HIA is to effectively manage the Internal

Audit department and to ensure that it adds value to the entity and its strategic objectives by strengthening risk controls, enhancing operational efficiencies, and ensuring governance compliance. The RBIA framework effectively ensures that internal audit coverage is commensurate with the nature of complexity of business operations on an ongoing basis. It encompasses coverage of business and support functions, technology and regulatory aspects as well as branch audits. HIA ensures compliance with the internal audit principles and standards and the independence of the Internal Audit department, its audit staff and evaluating its performance against key performance indicators.

The Audit Committee performs periodic reviews and evaluates adequacy and effectiveness of the Company's internal control environment, ensuring the timely implementation of audit recommendations to enhance operational integrity and regulatory compliance.

The Company's internal financial control is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles. The Company's internal financial control framework includes those policies and procedures aimed at:

Ensuring the maintenance of accurate financial records;

Providing reasonable assurance that are recorded appropriately for the preparation of financial statements; om June 30, 2025.

Establishing mechanisms for the timely prevention and detection of unauthorized acquisition, use or disposal of Company assets that may have a material impact on financial statements.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS

There were significant or material orders passed by the no regulators or courts or tribunals against the Company during the Financial Year 2024-2025.

ANY

During the year following material changes/events have occurred:

Material Event: Share Purchase Agreement and Open Offer

During the year under review, your Company entered into separate share sale agreements (collectively, "SPAs") with Aquilo House Pte. Ltd. ("Purchaser") and each of Lake District Holdings Limited, Partners Group ESCL Limited and Partners Group Private Equity (Master Fund), LLC, who were members of the promoter/ promoter group of the Company till June 30, 2025 (collectively, "Sellers"). Pursuant to the SPAs, the Purchaser agreed to acquire in aggregate 2,09,49,112 equity shares of the Company from the Sellers constituting 26.47% of the paid-up share capital of the Company and control of the Company subject to the terms and conditions set out in the SPAs.

The Purchaser is a Company incorporated under the laws of Singapore and belonging to the CVC Network. The CVC Network is a global alternative investment manager focused on private equity, credit, secondaries and infrastructure, consisting of CVC

Capital Partners PLC (a public limited Company whose shares are listed and admitted to trading on the Euronext Amsterdam

Stock Exchange) and each of its subsidiaries, from time to time. The execution of the SPAs triggered an obligation of the Purchaser to make an open offer to the public shareholders of the Company in accordance with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. The Purchaser acquired 1,78,08,116 equity shares of the Company aggregating to 22.50% of paid-up share capital of the Company pursuant to the open offer from the public shareholders.

In accordance with the terms of the SPAs, on June 30, 2025 (the "Closing Date"), Purchaser has acquired 2,09,49,112 equity shares constituting 26.47% of the paid-up share capital of the Company and on and from the Closing Date (i) Purchaser has acquired control of the Company and is categorized as a

‘promoter' of the Company; and (ii) the erstwhile promoters and members of the promoter group of the Company hold NIL transactions shares of the Company and have ceased to be in control of the

Company, and stand reclassified as public shareholders of the Companywitheffect

Currently, Purchaser holds 3,87,57,228 equity shares of the company, representing 48.96 % of the paid-up share capital of the Company.

Further, there are no material changes and commitments affecting the financial positions of the Company, which have occurred after March 31,2025, till the date of this report.

MAINTENANCE OF COST RECORDS

The Company being an NBFC-HFC is not required to maintain cost records as per sub-section (1) of Section 148 of the Companies Act 2013.

INFORMATION TECHNOLOGY

Your Company has always been at the forefront of technology innovations and effectively leveraging technology to enhance efficiency of the teams, managing risks, optimizing cost and provide superior experience to our customers.

The Company is working towards building a robust and scalable technology architecture in line with the charted transformation roadmap to make the Company future ready. Your Company has made a significant progress on this roadmap by successfully completing transformation of all key business applications.

The Company has already adopted a modern and innovative cloud-native application stack for loan origination and customer service using Salesforce and Mulesoft platforms which provide 360-degree visibility for the entire customer life cycle.

The Company has adopted ORACLE Fusion ERP System for accounting and financial reporting.

During Financial Year, the Company has successfully completed the migration of Loan Management System to ORACLE Flexcube

Core Banking Application and also automated the Treasury Operations using Beacon Treasury Management System.

By utilising multiple India stack based fintech integrations and advance analytics capabilities, we have significantly optimised our processes to bring in efficiency and agility at all levels. The Company has created a technology stack to integrate with digital platforms and our digital partnerships with Central Govt's

Common Service Centres (CSC), Rajasthan Govt's eMitra Kiosks and India Post Payment Bank are testament to the Company's commitment to become a partner in the last mile financial inclusion mission. The Company is actively looking forward to build and scale such partnerships in future.

The Company has upgraded the information security systems with modern and robust security solutions in all major domains including data centre, endpoints, applications, network, etc. The Company performs continuous training / awareness programs for our teams and customers on emerging cyber threats and defence strategies. The Company performs periodic assessments of security, process controls and business continuity readiness through various layers of internal teams, service providers and auditors.

HUMAN RESOURCE A CULTURE OF COMMITMENT, CONSISTENCY AND COMPASSION

Your Company has always been committed to nurturing a supportive, inclusive and dynamic workplace where each team member feels valued and motivated. Our comprehensive HR initiatives are designed to enhance employee well-being, cultivate professional growth, and build a strong sense of community. By investing in our people, we not only drive individual success and well-being, but also propel our organisation towards greater achievements. Its vision of being a leader and a role model in a broad based and integrated financial services business and a culture that is purpose driven gives meaning to our people.Aswereflecton the past Financial Year, 2025, it is evident that our success is intrinsically linked to the quality and competence of our human capital.

Your Company has continued to built upon the strong foundation established in previous years by implementing strategic initiatives designed to enhance the well-being, foster career growth and advance professional development of our employees. Among these initiatives, we have placed a particular emphasis on promoting the holistic well-being of our female staff and strengthening the leadership capabilities of our senior management team.

Recognizing the importance of a performance-driven culture, the Company introduced a performance-based equity scheme to instill a sense of ownership and accountability while incentivizing excellence. This initiative reflects our dedication to align individual contributions with organizational success, ensuring that employees are rewarded for their commitment and achievements.

Furthermore, we continue to invest in leadership development programs, mentorship opportunities, and skill enhancement initiatives to empower our workforce and equip them with the tools necessary to excel in an evolving business landscape.

As of March 31, 2025, our permanent employees count stood at 7,233, reflecting our growth and unwavering commitment to fostering a conducive and performance-driven organizational environment. In the future, your Company is committed to foster an improved workplace that nurtures professional development and operational excellence. Together, we will persist in our pursuit of excellence, promote sustainable growth and create lasting value for all our stakeholders.

RISK MANAGEMENT FRAMEWORK

Effective risk management is a crucial aspect of the Company's operations due to the inherent nature of its business. Acknowledging this, a series of internal policies have been established to strengthen the resilience of business operations.

Your Company priorities risk management by establishing a specialized sub-committee of executives, along with the Risk Management Committee of the Board, to supervise the process. This not only adheres to Regulation 21 of the SEBI (LODR) Regulations, 2015, but also guarantees conformity with RBI guidelines. The establishment of such a committee fosters a strong risk culture and governance framework within the organization, thereby enhancing its overall sustainability and success.

The Risk Management Committee convenes at least biannually, and additionally as required by the Board or Chairperson, to maintain continuous oversight of the Company's risk environment. By implementing suitable methodologies, processes and systems, the Committee is instrumental in monitoring and assessing the risks related to the business. Furthermore, the supervision of the Risk Management Policy's execution and the evaluation of the adequacy of risk management systems demonstrate a proactive stance towards risk management within the Company.

The Company has established comprehensive Risk Management Policies, which include Risk Management Policy, an IT Risk Management Policy, and an Internal Capital Adequacy Assessment Processes ("ICAAP") policy, along with an Early Warning Signal ("EWS") framework that adheres to RBI guidelines.

Identifying and monitoring significant risks such as Credit Risk, ALM Risk, Concentration Risk, Interest Rate Risk, Reputation Risk, Cybersecurity Risk, Fraud Risk, Business Risk, Exposure Risk, Competition Risk and Regulatory Risk are essential for preserving the Company's stability and resilience. These risks are reported to the Risk Management Committee quarterly, ensuring transparency and proactive risk management.

Additionally, the application of institutional intelligence in underwriting methodology, carried out by a skilled and experienced team, including Chartered Accountants, signifies a strong approach to risk assessment within the Company.

Moreover, the presence of dedicated vendors and professionally qualified in-house teams to manage legal, technical and operational risks further strengthens the Company's risk management capabilities.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

In any organization, a secure and confidential channel for reporting concerns related to ethical conduct is essential for maintaining accountability and integrity. Such a mechanism empowers individuals to raise issues without fear, fostering a culture of transparency and trust within the organization. Accordingly, your Company has in place a Whistle Blower Policy encompassing vigil mechanism pursuant to the requirements of

Section 177(9) and (10) of the Act and Regulation 22 of the SEBI (LODR) Regulations, 2015, to report to the management genuine concerns or grievances about unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct.

With the core aim to achieve the highest standards of ethical, moral and legal conduct of business operations and to nurture these standards, the Company encourages its employees who have concerns about suspected misconduct to come forward and express their concerns without fear of punishment or unfair treatment.

The mechanism provides a secure channel to the employees and Directors for adequate safeguards against victimization of employees and Directors who use such mechanism and makes provision for direct access to the Chairperson of the

Audit Committee in exceptional cases, ensuring transparency and accountability in addressing whistleblower concerns. There are no restrictions for accessing the Audit Committee for any of the Company's employees.

In order to safeguard the fairness of the process, the identity of the Whistle Blower is kept confidential to prevent any discriminatory actions against him/her.

The whistle blower policy is placed on the website of the

Company and can be accessed at https://www.aavas.in/codes-and-policies.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your Company is committed to foster a safe, respectful and inclusive workplace where every individual is empowered to work without fear, bias or harassment including sexual harassment. Primarily, we ensure a safe and equitable working environment for women and aim to ensure that every employee is treated with dignity and respect as sexual harassment at workplace is an extension of violence in everyday life and it is both discriminatory and exploitative, adversely impacting a women's right to life and livelihood.

Pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

("the POSH Act") and the rules made thereunder, the Company has formulated and implemented a Policy for prevention of sexual harassment against women and redressal of complaints thereto and has also constituted Internal Complaints Committee ("ICC") under the POSH Act.

ICC has been set up to redress complaints received regarding sexual harassment. All employees are covered under this policy.

The details of complaints received and disposed during the

Financial Year are provided in Corporate Governance Report forming part of this Annual report.

MATERNITY BENEFITS PROVIDED BY THE COMPANY UNDER MATERNITY BENEFIT ACT, 1961

The Company places strong emphasis on creating a supportive, inclusive and equitable workplace for its women employees. As part of this commitment, the Company have been in compliance with theallapplicableprovisionsofMaternityBenefit Act, 1961, during the financial year under review.

Accordingly, the Company has in place a well-defined Leave Policy, which explicitly outlines the provisions related to maternity leave and associated benefits. All eligible women have been extended the statutory benefits prescribed under the Act, including paid maternity leaves, continuity of salary and service during the leave period, and post maternity support.

Recognizing the importance of employee welfare, the Company remains dedicated to ensuring a safe and empowering work environment for its women employees in accordance with the applicable laws.

CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING IN COMPANY'S SECURITIES

The Company has, formulated and adopted code of conduct for prevention of Insider Trading in compliance with the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 ("the PIT Regulations").

The Code of Conduct for Prevention of Insider Trading was formulated to regulate, monitor and ensure reporting of trading by Designated Persons and their immediate relatives designated on the basis of their functional role in the Company towards achieving compliance with the Regulations and is designed to maintain the highest ethical standards of trading in Securities of the Company by persons to whom it is applicable. The provisions of the Code are designed to prohibit identified Designated Persons from trading in the Company's Securities while in possession of Unpublished Price Sensitive Information ("UPSI"). The Code lays down guidelines for procedures to be followed and disclosures to be made while dealing with Securities of the Company and cautions them against the consequences of violations.

In order to protect the interest of the stakeholders at large, Mr. Saurabh Sharma, Company Secretary and Compliance Officer of the Company, is authorized to act as Compliance Officer under the Code, with the responsibility to oversee adherence to Insider Trading Regulations and related governance principles.

Furthermore, in accordance with regulations 3 (5) and (6) of SEBI (PIT) Regulation 2015, the Company has maintained a Structural Digital Database ("SDD"), wherein details of persons with whom UPSI is shared on need-to-know basis and for legitimate business purposes is maintained with time stamping and audit trails to ensure non-tampering of the database. It ensures proper record-keeping and monitoring of access to UPSI. This database serves as an essential tool for regulatory compliance, preventing unauthorized dissemination and ensuring transparency in the management of sensitive financial information.

The SDD is maintained internally by the Company and is not outsourced in accordance with the provisions of the PIT Regulations.

PARTICULARS OF HOLDING/JOINT VENTURE/ SUBSIDIARY/ASSOCIATE COMPANIES

Pursuant to the share sale agreements with Aquilo House Pte. Ltd. ("Purchaser") and each of, Lake District Holdings Limited, Partners Group ESCL Limited and Partners Group Private Equity (Master Fund), LLC, who were members of the promoter/ promoter group of the Company till June 30, 2025 and pursuant to power conferred to purchaser in terms of Article 16 of the Article of Association of the Company, the Aquilo House Pte. Ltd has become the Holding Company in terms of Section 2(87)(i) of the Companies Act,2013 i.e. by controlling the composition of the Board of Directors w.e.f. June 30, 2025.

Further, your Company does not have any Joint Ventures or Associate Company as on the date of this report.

Subsidiary Company: Completion of Voluntary Liquidation

Your Company had an unlisted wholly owned subsidiary named ‘Aavas Finserv Limited' which has been voluntarily dissolved following the order passed by the Hon'ble National Company Law Tribunal ("NCLT") on January 28, 2025.

Therefore, your Company is no longer required to prepare Consolidated Financial Statements and Statement containing salient features of Financial Statement of the Subsidiary pursuant to the Provisions of Section 129(3) of the Act.

Further, pursuant to Section 129(3) of the Act read with the Companies (Accounts) Rules, 2014, a statement containing salient features of Financial Statement of the Subsidiary or

Associate Companies or Joint Ventures in the prescribed format AOC-1, is furnished as 'Annexure-6', which forms part of this Annual Report.

In accordance with Section 136 (1) of the Act, the Annual Report of your Company containing inter alia, Financial Statements has been placed on our website at https://www.aavas.in/investor-relations/annual-reports.

INVESTOR RELATIONS

Fostering trust through open and timely communication is fundamental in building strong and enduring relationships with the investment community. The Company remains committed to keep stakeholders well informed about its financial health, strategic initiatives and long-term objectives through consistent and transparent engagement. It is using technology wisely to sustain performance today and also leverages it for future growth. Your Company is always looking ahead and takes on a holistic perspective of the operating landscape.

To strengthen engagement and trust, the Company has established a specialized investor relation team, which helps the Company to communicate with its investors through Information session on Financial Results for institutional investors and analysts via telephone conference, meetings with investors/analysts and discussions between Fund Managers and Management.

Investor relation team participate in investor relations conferences each quarter to foster better relationships with investors. Presentations given by Company to fund managers, analysts, and investors are posted on the Company website and are also transmitted to stock exchanges. Each quarter, the audio recordings of these meetings, along with their transcripts, are posted on the website at https://www.aavas.in/investor-relations/investor-intimation.

PARTICULAR OF EMPLOYEE REMUNERATION AND RELATED DISCLOSURES

In compliance with Section 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, disclosures regarding the remuneration of Directors and employees have been made. Additionally, as stipulated by Rule 5(2) of the aforementioned rules, the names and other details of the top ten employees in terms of remuneration have been included as ‘Annexure-8' to this Report.

CORPORATE SOCIAL RESPONSIBILITY ("CSR")

Your Company, being a responsible corporate citizen, is dedicated to enhancing societal welfare by incorporating social and environmental considerations into its business practices, engaging in philanthropic efforts, and delivering positive social value and wealth to its stakeholders. In line with the Company's

Corporate Social Responsibility ("CSR") initiatives, it has launched various projects focused on Education and Holistic

Development, Environmental Sustainability, Healthcare and

Wellness, Community and Rural Development, Women's Empowerment, and Strategies for Reducing Inequalities, all aimed at improving the quality of life in diverse communities, particularly among marginalized groups.

The CSR policy of the Company relates to the activities to be undertaken by the Company, which is in accordance with the provisions of CSR under Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 and Schedule VII of the Act.

The CSR Policy is hosted on Company's website and can be accessed at: https://www.aavas.in/codes-and-policies and the Annual Report on CSR activities is furnished as ‘Annexure-9' which forms part of this Annual Report.

PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, the particulars of energy conservation, technology absorption and foreign exchange earnings and outgo is provided as under:

ENVIRONMENT HEALTH AND SAFETY ("EHS") PROTECTION

The Company is committed to maintain high environmental and social standards across its operations. It continues to enhance its investment decision-making processes and procedures to align with applicable Indian environmental and social legislation, as well as relevant international standards, including the IFC

Performance Standards, particularly in relation to its housing finance and MSME Business segments.

The Company ensures a healthy and safe working environment for all its employees, adhering to best practices in workplace safety and employee well-being. In line with its commitment to continuous improvement, the Company regularly evaluates and upgrades its EHS practices to proactively address emerging risks, ensure compliance, and foster a culture of safety and sustainability across all levels.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORTING

In accordance with Regulation 34(2)(f) of the SEBI (LODR) Regulations, 2015, the top 1,000 listed companies based on market capitalization are required to include a Business

Responsibility and Sustainability Report (BRSR) in their Annual

Reports. This report outlines the Company's initiatives from an Environmental, Social and Governance ("ESG") perspective.

Following SEBI Circular SEBI/HO/CFD/PoD2/CIR/P/0155 dated November 11, 2024, the top 250 listed entities are required to disclose ESG information under the BRSR Core framework as part of their Annual Reports.

As one of the top 500 listed entities, and in alignment with its commitment to strong corporate governance, the Company has voluntarily adopted and submitted the BRSR Core Framework for the Financial Year 2024-25, in addition to publishing the standard Annual BRSR as per regulatory guidelines. This framework helps reinforce ESG principles throughout the Company's operations, guiding efforts towards responsible product development, operational efficiency, employee empowerment, and environmental stewardship in line with the expectations outlined in the BRSR.

The Company remains focused on strengthening its ESG performance year over year, continually enhancing its disclosures, systems, and practices to create meaningful impact and align with evolving stakeholder expectations.

The Business Responsibility and Sustainability Report in updated format describing the initiatives taken by the Company from an environmental, social and governance perspective along with Limited Assurance Statement from an Independent

Auditor forms part of this Annual Report as ‘Annexure-11'.

ANNUAL RETURN

The Annual Return has been prepared in form MGT-7 as on March 31, 2025 in compliance with the provisions of Section 134(3) and Section 92(3) of the Act, read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014. The same is placed on the website of the Company and can be accessed at https://www.aavas.in/investor-relations/annual-reports.

ADDITIONAL DISCLOSURES UNDER COMPANIES (ACCOUNTS) RULES, 2014

(a) The details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the Financial Year:

The Company has not filled any application under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the Financial Year under review. Hence there are no proceedings pending with respect to the above. Therefore, it is not applicable to the Company.

(b) The 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 Institutions along with the reasons thereto:

During the Financial Year under review, the Company has not made any settlement with its Bankers or Financial Institutions from which it has availed any term loan.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Since the Company is an HFC, it is exempted from disclosing information regarding particulars of loans extended, guarantees given, and security provided in the ordinary course of business under the provisions of Section 186(11) of the Act.

Nevertheless, the notes to the Financial Statements of the

Company state the details of loans, guarantees, and investments made as required under the provisions of Section 186 of the Act and the rules made thereunder.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

Your Company has an explicit "Policy on Materiality of

Related Party Transactions and dealing with Related Party Transactions" to ensure that all related party transactions are on an arm's length basis and in the ordinary course of business in adherence of the provisions of Section 188 of the Act and rules made thereunder and the SEBI (LODR) Regulations, 2015. Accordingly, all related party transactions entered during Financial Year 2024-25 were on an arm's length basis and in the ordinary course of business under the Act and were not material under the SEBI (LODR) Regulations, 2015.

All related party transactions entered into during the Financial

Year, were presented to both the Audit Committee and the Board. The Audit Committee has granted omnibus approval for related party transactions as per the provisions of the Act and the SEBI (LODR) Regulations, 2015. Further, in compliance with the Section 134(3)(h) of the Act, a thorough disclosure has been made in Form AOC-2 as ‘Annexure-7' which forms part of this Annual Report.

Additionally, in compliance with the SEBI and RBI Master

Directions, the 'Policy on Materiality of Related Party

Transactions and dealing with Related Party Transactions' is given in ‘Annexure-10' which forms part of this Annual Report and is available for viewing on the Company's website at https:// www.aavas.in/codes-and-policies.

INTERNAL GUIDELINES ON CORPORATE GOVERNANCE

Corporate Governance forms the cornerstone of responsible and ethical business conduct, ensuring transparency, accountability and long term value creation for all the stakeholders of the Company. Your Company has been committed to uphold the greatest standards of corporate governance by adhering to its fundamental values, which include putting the needs of the customer first, being transparent, acting fairly, being accountable, and acting with integrity and equity in all of its dealings.

The Company's Corporate Governance framework ensures that it makes timely and appropriate disclosures and shares factual and accurate information to its stakeholders so as to make an informed decision.

The Company has approved and adopted the Internal Guidelines on Corporate Governance. The Internal Guidelines on Corporate Governance has been framed in accordance with the Act, SEBI (LODR) Regulations, 2015, RBI Master Directions, 2021 and other applicable rules and regulations.

The Internal Guidelines on Corporate Governance of the Company is available on the website of the Company and can be accessed at https://www.aavas.in/codes-and-policies.

DIRECTORS' RESPONSIBILITY STATEMENT

In compliance with the provisions of Section 134(3)(c) and 134(5), of the Act and based on the information provided by the Management, the Board of Directors hereby gives the following statement:

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; (b) the Directors had selected such accounting policies 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 and loss of the

Company for that period;

(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; (d) the Directors had prepared the annual accounts on a going concern basis;

(e) the Directors had laid down Internal Financial Controls to be followed by the Company and that such Internal Financial Controls are adequate and were operating effectively; and

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

BUSINESS OVERVIEW & FUTURE OUTLOOK

A comprehensive evaluation of the business and its future prospects is included in the Management Discussion and

Analysis section of the Annual Report.

ACKNOWLEDGEMENTS AND APPRECIATION

Behind every milestone achieved lies the collective effort of many, as we reflect on the past years, the Board of Directors is proud to recognize collective efforts of all stakeholders of the Company, that have enabled the Company to move forward with purpose and resilience.

We extend our heartfelt appreciation for all the support and trust received from the Stakeholders of the Company, including the Reserve Bank of India, National Housing Bank, Ministry of Corporate Affairs, Securities and Exchange Board of India, Insurance Regulatory and Development Authority of India, Stock Exchanges i.e. BSE and NSE, and other regulatory authorities.

The Board also acknowledges the support and cooperation from Bankers, Lenders, Financial Institutions, Members, Credit Rating Agencies, National Securities Depository Limited, Central Depository Services (India) Limited, National Stock Exchange International Financial Service Centre Limited, and Customers of the Company for their continued trust and support.

The Directors wish to express their deep appreciation to Kedaara Capital and Partners Group for their invaluable support which proved instrumental in driving the Company's growth and success. Further, the Board is also thankful to the resigning directors for their enduring commitment and meaningful Contributions.

We also take this opportunity to warmly welcome our new Promoter, Aquilo House Pte. Ltd., belonging to CVC network, whose induction marks a significant milestone in the Company's growth journey. We look forward to a strong and fruitful partnership, leveraging their expertise and vision to drive sustained progress and long-term value creation.

Additionally, the Board records its sincere appreciation for the commitment demonstrated by all executives, officers, staff, and the Senior Management team of the Company, for contributing to the excellent performance of the Company during the

Financial Year.

The Board wishes to express its gratitude to all the Shareholders for their invaluable support.