independent auditors' report to the … · the company has got classified as nbfc-mfi and...

GOWTHAMA & COMPANY CHARTERED ACCOUNTANTS

INDEPENDENT AUDITORS' REPORT

TO THE MEMBERS OF SAMASTA MICROFINANCE LIMITED

Report on the Financial Statements

We have audited the accompanying financial statements of SA1VIASTA MICROFINANCE LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2017, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial control, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. C& 04 fp

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23/57, 41st Cross, East End, 'C' Main Road, 9th Block, Jayanagar, Bangalore - 560 069 Tel : 2663 6042 / 2665 6194 Tel / Fax: 080-2665 1104

E.mail : [email protected] / [email protected] / narayanegowthama.com

SAMASTA MICROFINANCE LIMITED CIN: U65191KA1995PLC057884

Registered Office: No. 418, 1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027.

Note 1 - Significant Accounting Policies & Notes forming part of the Consolidated Financial Statements

1. Basis of Preparation:

The financial statements of the Company have been prepared in accordance with Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standard specified under section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act")/Companies Act 1956, ("the 1956 Act"), as applicable. The financial statements have been prepared on accrual basis and the directions issued by the Reserve Bank of India (RBI) to the extent applicable to the Company.

The Company follows the prudential norms for Income recognition, asset classification and provisioning as prescribed by the RBI for Non-deposit taking Non-Banking Financial Companies (NBFC-MFI).

2. Use of Accounting Estimates:

The presentation of financial statements in conformity with Indian Generally Accepted Accounting Principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Although such estimates are made on a reasonable and prudent basis taking into account all available information, actual results could differ from those estimates.

3. Cash flow statement:

The Cash Flow are reported using the indirect method, whereby profit / (loss) before tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on available information.

4. Provisions and contingent liabilities:

A provision is recognized when the Company has a present legal or constructive obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which reliable estimate can be made. Provisions are not discounted to their present value and are determined based on best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent

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Registered Office: No. 418, 1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027.

liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably.

The Company does not recognize a contingent liability but discloses its existence in the financial statements.

5. Income Taxes and Deferred Taxes:

Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax is recognized, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognized only if there is virtual certainty that they will be realized and are reviewed every year. The tax effect is calculated on the accumulated timing differences at the end of the year based on enacted or substantially enacted tax rates.

6. Fixed Assets and Depreciation & Amortization:

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.

Depreciation on tangible fixed assets has been provided on the straight-line method as per the useful life prescribed in Schedule ll to the Companies Act, 2013, except in respect of the following category of assets, in whose case the life of the asset has been assessed based on the technical assessment, which takes into account the nature of the asset, its estimated usage, past history or replacement, operating conditions and future technological changes, following is the categories of assets:

Computers - 3 Years

Intangible assets are amortized over their estimated useful life as follows:

Software - 3 Years Servers & Networks- 6 Years

Individual assets costing less than Z 5,000 each are depreciate fully in the year of purchase.

7. Investments:

Investments which are long term in nature are stated at cost with provisions where necessary for diminution, other than temporary, in the value of Investment.

8. Classification & Provisions of Loan Portfolio:

Loans are classified and provided as per norms required in Non-Banking Financial (Non- Deposit Accepting) Companies Prudential Norms (Reserve Bank) Directions, 2007, as amended from time to time.

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The Company has got classified as NBFC-MFI and accordingly has provided its provisioning norms for loan portfolio vide RBI circular dated December 02, 2011 as amended vide circular dated March 20, 2012. According to which the provision will be higher of:

a) 1% of the outstanding loan portfolio or b) 50% of the aggregate loan installments which are overdue for more than 90 days and

less than 180 days and 100% of the aggregate loan installments which are overdue for 180 days or more.

9. Trade receivables under Financing Activity:

Trade receivables under financing activity include Income Generating Loan, Dairy Cow Loan / Cattle Loan, Water Purifier Loan, Solar Products Loan and Individual Loan. Loans are classified into 'Performing and Non- Performing assets in terms of the Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998 and NBFC-MFI Directions (as applicable) issued by the Reserve Bank of India as amended from time to time.

10. Revenue Recognition:

• a) Revenue from Interest on loans financed by the company is recognized on accrual basis, considering the directions issued by the Reserve Bank of India from time to time in terms of the Non Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998.

b) Interest income on Fixed Deposits with Banks is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

c) Processing fee is recognized as and when collected at the time of loan disbursement.

d) Dividend income from investments in mutual fund is recognized when the right to receive is established.

e) Facilitation fee is recognized on accrual basis according to the terms of agreement.

f) Profit/Premium arising at the time of securitization of loan portfolio is amortized over the life of the underlying loan/portfolio/securities and loss arising thereon is accounted immediately

g) All other income is recognized on an accrual basis, when there is no uncertainty in the ultimate realization / collection.

11. Borrowing Costs:

Borrowing costs attributable to qualifying assets (assets which require substantial period of time to get ready for their intended use) are capitalized as part of the cost of such assets. All other borrowing costs are charged to revenue. & C0,0

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SAMASTA MICROFINANCE LIMITED CIN: 1J65191KA1995PLC057884

Registered Office: No. 418, 1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027. 12. Earnings per Share:

Basic and diluted earnings per share are computed in accordance with Accounting Standard (AS)-20 — Earnings per share. In determining the Earning per Share the Company considers the Net Profit after Tax. The number of Shares used in computing Basic Earning per share is number of share outstanding during the period. The number of shares used in computing diluted earnings per share comprises the weighted average shares considered for deriving basic earnings per share and also the weighted average number of equity shares that could have been issued on the conversion of all dilutive potential equity shares.

13. Employee Benefits:

a) Short Term Employee Benefits:

All employee benefits falling due wholly within twelve months of rendering the services are classified as short term employee benefits, which include benefits like Salary, Allowances and incentives, and are recognized as expenses in the period in which the employee renders the related service.

b) Post- employment Benefits:

Defined Contribution Plans:

The Company's contributions to provident fund are considered as defined contribution plans and are charged as an expense as they fall due based on the amount of contribution required to be made.

Defined Benefit Plans:

For defined benefit plans in the form of gratuity, which is not funded, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each Balance Sheet date. Actuarial gains and losses are recognized in the Statement of Profit and Loss in the period in which they occur. Past service cost is recognized immediately to the extent that the benefits are already vested and otherwise is amortized on a straight-line basis over the average period until the benefits become vested. The retirement benefit obligation recognized in the Balance Sheet represents the present value of the defined benefit obligation as adjusted for unrecognized past service cost.

14. General:

Any other accounting policy not specifically referred to are consistent with generally accepted accounting principles.

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SAMASTA MICROFINANCE LIMITED CIN: U65191 KA1995PLC057884

Registered Office: No. 418, MA, 4th Cross, 6th Main, Wilson Garden, Bangalore • 560027.

CONSOLIDATED BALANCE SHEET AS AT 31ST MARCH, 2017

Particulars Note No. As at 31st

March, 2017 As at 31st

March, 2016 2 2

I EQUITY AND LIABILITIES

(1) Shareholder's Funds (a) Share Capital 2 61,34,46,110 11,47,00,000 (b) Reserves and Surplus 3 3,25,87,904 2,37,13,456

64,60,34,014 13,84,13,456 (2) Non-Current Liabilities

(a) Long-term borrowings 4 68,26,70,317 32,66,91,099 (b) Long-term provisions 6 2,36,07,225 1,22,58,331

70,62,77,542 33,89,49,430 (3) Current Liabilities

(a) Other current liabilities 7 90,63,43,873 50,32,18,084 (b) Short-term provisions 8 34,00,000 82,52,901

90,97,43,873 51,14,70,985

Total 2,26,20,55,429 98,88,33,871 II ASSETS

(1) Non-current assets (a) Fixed assets 9

(i) Tangible assets 2,13,15,419 1,00,16,410 (ii) Intangible assets 7,25,220 8,56,799

(b) Non-current investments 10 5,00,000 5,00,000 (c) Deferred tax assets (Net) 5 47,87,015 28,23,812 (d) Other non-current assets 11 54,61,79,214 30,36,76,381

57,35,06,868 31,78,73,402 (2) Current assets

(a) Trade Receivables 12 1,06,97,71,636 50,78,28,796 (b) Cash and Cash equivalents 13 56,65,38,372 14,43,02,313 (c) Short-term loans and advances 14 1,67,44,400 60,30,734 (d) Other current assets 15 3,54,94,153 1,27,98,626

1,68,85,48,561 67,09,60,469

Total 2,26,20,55,429 98,88,33,871

Significant accounting policies and notes to the accounts 1

As per our attached report of even date For Gowthama48...Conibqyp Chartered Ascourltsnts., ^94,,,. For and on behalf of the Board of Directors

Firm No. 90591'iS ., -ir

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N.V. Gowiha -.. 059iS Z ' — ,.-.

D. Shivaprakash N. Venkatesh

Partner -,‘•,)

Okt°C) a. r'C '''

P,r• ' Managing Director II Whole-time Director

M. No. 014353 '''''Pcn

7 . Aai‘1,-/-A)1/49)—. • -. _ T. Anantha Kumar K. J. Sut

Chief Financial Officer Company Secretary

Place: Bangalore Date: 21.04.2017

SAMASTA MICROFINANCE LIMITED CIN: U65191KA1995FILC057884


CONSOLIDATED STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH, 2017

Particulars Note No. Year ended

31st March, 2017 Year ended

31st March, 2016 8 8

(A) Revenue from Operations 16 32,04,31,427 19,32,47,992 (8) Other Income 17 1,03,71,001 2,02,60,064

(C) Total Revenue (A*8) 33,08,02,428 21,35,08,056

(D) Expenses a) Employee benefits expenses 18 11,21,74,369 4,95,96,321 b) Finance costs 19 13,85,00,431 9,79,59,800 C) Depreciation and amrotization expenses 9 45,80,939 26,98,416 d) Administrative and Other expenses 20 6,87,75,566 3,89,89,608 e) Cost of traded goods 16,61,791

Total Expenses (0) 32,40,31,305 19,09,05,936

(E) Profit for the year before tax (C-D) 67,71,123 2,26,02,120

(F) Tax expenses (a) Current tax 16,00,000 71,50,000 (b) MAT credit availed and utilised (13,42,390) 64,120 (c) Income tax adjustment (1,308) (d) Deferred tax 5 (19,63,203) (11,36,105)

(G) Profit for the year after tax (E-F) 84,76,716 1,65,25,413

(H) Profit for the period from continuing operations 84,76,716 2,93,09,889

(I) Loss for the period from discontinuing operations - (67,07,769)

(J) Tax expense of discontinuing operations - -

(K) Profit from discontinuing operations(after tax) (I-J) - (67,07,769)

(L) Profit for the period ( H+K) 84,76,716 2,26,02,120

(H) Earnings per Equity Share (Face value of 810/. each): (a) Basic 0.55 1.58 (b) Diluted 0.55 1.58


As per our attached report of even date For Gowthama CompanyCharteredrA8bountanP4

• For and on behalf of the Board of Directors

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NV. Gowthama-,NV • '..-4- N. Venkatesh ,,,NiS D. Shivaprakash 90(f-' v Partner,.., v9,14 Managing Director hole-time Director

, M. No. 01435,8

a •.1 — k , . T. Anantha Kumar K. J. Sutheja .... Chief Financial Officer Company Secretary


SAMASTA MICROFINANCE LIMITED CM: U65191KA11195PLC057884

Registered Office: No. 418, 1/2A, 4th Cross, 6th Main, Wilson Gordon, Bangalore -56002?.

CONSOUDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2017

Particulars Year ended 31st March,

2017 Year ended 31st March,

2016 It r

CASH FLOW FROM OPERATING ACTIVITIES

Net Profit Before Tax 67,71,123 2,26,02120 Adjustments for: Depreciation 45,80939 2698,416 Dividend on Mutual funds (72,59,028) (23,00.293) Provisions for Standard and Non Perfoming Assets 75.58,375 10,27,402 Bad Debts Written Off 29,58.880 49,24,627 Interest on Fixed Deposits (1,30,81,047) (71,15,063) Profit on sate of Fixed assets S - (53,118) Loss on sale of Fixed assets 87,965 19,80,904 Assets written off • 16,996 Operating Profit before Working Capital Changes A 16,17,206 2,37,81,990

Working Capital Changes: (Increase) / Decrease In trade and other receivables (56,49,01,720) (3,98,86,385) (Increase) / Decrease in Short term loans and advances (1,07,13,666) (41,07,164) (Increase) / Decrease in Other Current Assets (1,29,48,585) (53.48.379) (increase) / Decrease In Loans & Advances (19,08,84,377) (Increase) / Decrease In Other Non- Current Assets (4,22,95,385) (13,57,88,241) increase/ (Decrease) in Long term Liabilities 35,59,79,218 10,34,90,702 Increase / (Decrease) in long term provisions (15,79,164) 12,47,187 increase! (Decrease) in Other current liabilities 40,31,25,789 13,81,20,814 Increase / (Decrease) in trade payables - (1,41,604) Changes in Working Capital B (6,42,17,890) 5,75,86,930

Cash generated from operations A+B (6,26,00,684) 8.13.68,921 income taxes paid (79,80,680) (51,38,885) Net cash from operating activities (7,05,81,364) 7,62,30,035

CASH FLOW FROM INVESTING ACTIVITIES . investment in mutual fund (97,46,942) - Sale of Fixed Assets 5,90,500 16,26,600 Dividend from Mutual Funds 72,59,028 23,00,293 Purchase of Fixed Assets (1,64,26,835) (55,07,930) interest on Fixed Deposits 1,30,81,047 71,15,064 Net Cash used in Investing activities (92,43,209 55,34,027

CASH FLOW FROM FINANCING AcrtvrriEs . Proceeds from Issue of Equity Share Capital 50,00.00,000 - Dividends paid (Including DDT) (19,39,376) (59,908) Net cash used In financing activities 49,80,60,624 (59,908)

Net increase In cash and cash equivalents 42,22,36,059 8,17,04,154

Cash and cash equivalents as 81 01.04.2016 14,43,02,313 6,25,98,159

Cash and cash equivalents as at 31.03.2017 56,65,38,372 14,43,02,313

The above Cash Flow Statement has been prepared under the Indirect Method" as set out In Accounting Standard -3 on Cash Flow Statement

As per our attached Qtp(2113)01Agn date For Gowthameolitompany 4). For and on behalf of the Board of Directors Chartered Acecuatenfa . Firm No. 00E917'pr •j, * .)•••—•—%=.------5::2s=li-Ci--14s.

\ ,COIS N. Venkatesh D. Shbrapnakash H.V. Gowihama,,./..0',4‘541'- Managing Director Whole-time Director Partner E5q93.40,-,- 4,1=

64 M. No. 014353 tot .'cnrn 0, T. Anantha 1:101-4-)"4"--

Kumar K. J. Suthe

Chief Financial Officer Company Secretary


SAMASTA MICROFINANCE LIMITED ' CIN: U65191K41995PLC0578134

Registered Office: No. 418, 1/24, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027.

Note 2 - Share Capital

Particulars . As at .

31st March, 2017 Z

As at 31st March, 2016

r Authorised: 63,000,000 (Previous year 10,500,000 Equity Shares of? 10/- each) Equity Shares of? 10/-each 63,00,00,000 10,50,00,000 2,000,000 (Previous year 2,000,000 Preference Shares of? 10/-each) Preference Shares of? 10/- each 2,00,00,000 2,00,00,000

65,00,00,000 12,50,00,000

Issued: .

61,344,611 (Previous year 10,470,000 Equity Shares of? 10/- each) Equity Shares of? 10/- each 61,34,46,110 10,47,00,000 NIL (Previous year 1,000,000 9% Optionally Convertible Preference Shares of? 10/- each) 9% Optionally Convertible Preference Shares of? 10/- each - 1,00,00,000

61,34,46,110 11,47,00,000

Subscribed and Paid up:

61,344,611 (Previous year 10,470,000 Equity Shares of' 10/- each) Equity Shares of' 10/- each 61,34,46,110 10,47,00,000 NIL (Previous year 1,000,000 9% Optionally Convertible Preference Shares of' 10/- each) 9% Optionally Convertible Preference Shares of' 10/- each 1,00,00,000 Total 61,34,46,110 11,47,00,000

I) Reconciliation of the number of shares outstanding at the beginning and at the end of As at As at the year: 31st March, 2017 31st March, 2016

Number of shares Number of shares Equity Shares: Number of shares at the beginning of the year 1,04,70,000 1,04,70,000 Add: Equity shares issued during the year 5,08,74,611 Number of shares at the end of the year 6,13,44,611 1,04,70,000

Preference Shares: Number of shares at the beginning of the year 10,00,000 10,00,000 Add: Preference shares issued during the year Less: Preference shares converted during the year 10,00,000 - Number of shares at the end of the year 10,00,000

II) Number of shares held by each shareholder holding more than 5% shares In the company are as follows: Class of shares / Name of the shareholder

As at As at Particulars 31st March, 2017 31st March, 2016

Number of shares Number of shares Equity Shares: India Infoline Finance Limited 5,84,17,631 - R.C. Shekar - 17,65,020 V.A. Narayanaswamy 10,48,800 G.J. Krishnaprasad 5,52,000 N. Venkatesh - 13,35,840 Kalpathi Investments Pvt Ltd - 16,56,000 B.H.Krishnamurthy - 5,52,000 Sanjay Shenoy - 5,52,000 Small Industries Development Bank of India - 15,00,000 Total 5,84,17,631 89,61,660 Preference Shares: Small Industries Development Bank of India - 10,00,000 Total - 10,00,000

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Registered Office: No. 418,1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027.

ill) Terms! rights attached to EquityShares:

The Company has Equity Shares having par value of 7 10/- per share. Each holder of Equity Shares is entitled to one vote per share. Holders of Equity Shares are entitled to dividend, in proportion to the paid up amount, proposed by Board of Directors subject to approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. .

Iv) Terms / rights attached to Preference Shares: a) Rights/preferences attached to Preference Shares

The dividend on preference shares proposed by the Board of Directors is subject to approval of shareholders in the ensuing Annual General Meeting. Each holder of Preference Share is entitled to one vote per share only on resolutions placed before the Company which directly affect the rights attached to the said shares. In the event of liquidation of the Company before redemption of preference shares, the holders of preference shares will have priority over equity shares in the payment of dividend and repayment of capital and premium thereon but shall not be entitled to any surplus arising thereto.

b) Terms of redemption of Preference Shares

Particulars As at

31st March, 2017 Number of shares


Number of shares 1)9% Optionally Convertible Preference Shares (OCPS) of Z 10/- each. The Company will redeem each of the OCPS (face value of Z 10/-) which is not converted into equity shares at par. The Company will, before such redemption, pay all outstanding dividends on such OCPS to SIDBI. The redemption will be made by the Company as indicated below: - 1>50% of the outstanding OCPS at the end of 5 years 2) Remaining 50% outstanding OCPS at the end of 6 years commencing from the first date of

disbursement/investment/subscription of OCPS by SIDBI in the Company. ,

10,00,000

Note 3 - Reserves and Surplus

Particulars As at

31st March, 2017 T


r a) Securities Premium Account

Opening Balance - - Add: Premium on shares issued during the year 12,53,890 - Less: Utilised towards Issue of Bonus Shares - Closing Balance

b) Other Reserve

12,53,890 -

I) Statutory Reserve Opening Balance 61,32,977 31,82,977 Add: Additions during the year 16,25,000 29,50,000 Closing Balance

d) Surplus

77,57,977 61,32,977

Opening Balance 1,75,80,479 50,88,284 Add: Profit for the year • 84,76,716 1,65,25,413 Less: Proposed Dividend on Preference Shareholders 7,29,863 9,00,000 Less: Dividend Distribution Tax 1,26,295 1,83,218 Less: Transfer to Statutory Reserve 16,25,000 29,50,000 Closing Balance 2,35,76,037 1,75,80,479

Total 3,25,87,904 2,37,13,456

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SAMASTA MICROFINANCE LIMITED CIN: U65191KM995PLC057884

Registered Office: No. 418,112A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027.

Note 4 - Long-Term Borrowings

Particulars As at

31st March, 2017 t


T a) Term Loans - Secured 1) From Banks (Refer Note 4.1) 24,76,56,453 19,40,04,064 2) From Other Parties (Refer Note 4.1) 24,61,97,121 8,51,57,078

b) Non-Convertible'Debentures - Secured (Refer Note 4.1) 13,75,00,800 4,58,33,400

c) Non-Convertible Debentures - Unsecured (Refer Note 4.1) -Tier II Capital

d) Cash Credit - Secured

5,00,00,000 -

1) From Banks (Refer Note 4.1) - -

e) Vehicle Loans - Secured ,

1) From Banks (Refer Note 4.1) 6,76,627 8,74,719 2) From Other Parties (Refer Note 4.1) 6,39,316 8,21,838

Total 68,26,70,317 32,66,91,099



Note 4.1

Term Loan from Banks - Secur

Name of the Bank Terms of repayment

'

Security Offered As at 31st March, 2017 As at 31st March, 2016

Current Liabilities T

Non-current Liabilities

T



T

Bank of Maharashtra Rate of Interest - Base rate + 5.25%, loan repayable in 33 monthly installments.

Hypothecation of book debts and personal g guarantee of Mr. N. N Venkatesh and Mr. R.C. Shekar, Director.

- - 1,67,77,310 -

• Bank of Maharashtra

Rate of Interest - Base rate + 4.50%, loan repayable in 33 monthly Installments.

Hypothecation of book debts, cash collateral and personal guarantee of Mr. N. Venkatesh, Director.

1,09,20,000 28,74,738 1,12,20,715 1,36,25,725

Bank of Maharashtra Rate of Interest- Base rate + 4.50%, loan repayable in 45 monthly installments.


1,33,44,000 2,82,55,787 5,00,473 20,00,500

Canara Bank Rate of Interest - Base rate + 3.00%, loan repayable in 12 quarterly installments.


1,00,00,000 -

50,00,000 1,00,00,000 1,50,00,000

Corporation Bank Rate of Interest - Base rate + 2.10%, loan repayable in 12 quarterly installments.

Hypothecation of book debts and personal guarantee of Mr. N. Venkatesh, Director.

. - 42,05,002 -

Indian Bank Rate of Interest - Base rate + 3.80%, loan repayable in 36 monthly installments.


58,19,882 - 1,15,39,154 59,70,242



99,99,996 1,03,80,872 92,11,381 2,01,02,769

Kaveri Grameena Bank Rate of Interest - 14.25%, loan repayable In 36 monthly installments.


1,26,46,933 - 1,66,66,680 1,28,53,976

Kaveri Grameena Bank Rate of Interest - 13.75%, loan repayable In 36 monthly installments.


1,66,66,680 1,70,42,654 16,94,933 33,33,320


Registered Office: No. 418 112A, 4th Cross 6th Main Wilson Garden Ban alore -

Lakshmi Vilas Bank Rate of Interest - Base rate + 2.25%, loan repayable in 36 monthly installments.

Hypothecation of book debts and cash collateral 1,63,96,547 2,02,73,934 1,33,22,555 3,66,77,445

Lakshmi Vilas Bank Rate of Interest- 12.55% loan repayable in 33 monthly installments.

Hypothecation of book debts and cash collateral 66,66,672 1,27,77,772 - -

Pallavan Grama Bank Rate of Interest - 14.00%, loan repayable in 33 monthly installments. -


34,48,663 - 1,14,58,816 35,98,134

Pallavan Grama Bank Rate of Interest - 14.00%, loan repayable in 33 monthly installments.


1,12,59,481 II

1,24,13,177 9,13,793 20,90,910



33,67,499 64,76,080 - -

Ratnakar Bank Ltd. * Rate of Interest - 13.50% loan repayable in 24 monthly installments.


2,28,57,143 1,14,28,571 - -

South Indian Bank Rate of Interest - Base rate + 3.70%, loan repayable in 33 monthly installments.

Hypothecation of book debts, cash collateral and personal guarantee of Mr. N. Venkatesh, Mr. D. Shivaprakash, & Mr. R.C. Shekar Director

36,36,000 33,34,000 30,30,000 69,70,000


Hypothecation of book debts, cash collateral and personal guarantee of Mr. N. Venkatesh, Mr. D. Shivaprakash, & Mr. R.C. Shekar Director

36,36,000 33,34,000 30,30,000 69,70,000

South Indian Bank Rate of Interest - 13.30% loan repayable in 35 monthly installments.


83,38,000 1,66,62,000 - -



83,38,000 1,66,62,000 - -

State Bank of India Rate of Interest - 12.25%loan repayable in 36 monthly installments.

theon Hypocati cash collateral. of book debts and 4,00,00,000 5,42,61,539 - -


Re istered Office: No. 418 112A, 4th Cross 6th Main Wilson Garden Ban alore -560027

Rate of Interest - Base rate Hypothecation of book debts, cash State Bank of Mysore + 2.25%, loan repayable in collateral and personal guarantee of 1,09,09,200 23,21,689 1,09,09,200 1,32,39,389

33 monthly installments. Mr. N. Venkatesh, Director. -


Registered Office: No. 418 112A, 4th Cross 6th Main Wilson Garden n alor

State Bank of Patiala Rate of Interest - Base rate + 3.50%, loan repayable in 34 monthly installments.


36,83,751 - 1,09,09,200 36,27,851

State Bank of Travancore Rate of Interest - Base rate + 4.50%, loan repayable in 33 monthly installments.


1,84,66,503 - 1,81,80,000 1,86,61,118

UCO Bank Rate of Interest - Base rate + 4.50%, loan repayable in 36 monthly installments.

Hypothecation of book debts, cash collateral and personal guarantee of Mr. N. Venkatesh, Mr. D. Shivaprakash and Mr. R.C. Shekar, Director.

- - 8,47,029 -

UCO Bank Rate of Interest.. Base rate + 3.00%, loan repayable in 45 monthly installments.


72,86,685 - 80,04,000 72,86,685



80,00,004 1,39,95,996 80,04,000 2,19,96,000

UCO Bank Rate of Interest - 11.75% loan repayable in 48 monthly installments.

Hypothecation of book debts and cash collateral. 1,00,00,000 - - -

YES Bank Ltd. Rate of Interest - 12.25% loan repayable in 48 monthly installments.


1,00,00,000 1,01,61,644 - -

TOTAL 27,56,87,639 24,76,56,453 17,04,24,241 19,40,04,064

SAMASTA MICROFINANCE LIMITED CIN: U651911441995PLC057884


Term Loan from Other Parties Secured

Name of the Fl / NBFC Terms of repayment Security Offered

As at 31st March, 2017 As at 31st March, 2016

Current Liabilities 2


7

Current Liabilities 2


7

Agri Business Finance Ltd. Rate of Interest - 13% loan repayable in 36 monthly installments.

1,66,80,000 3,33,20,000 Hypothecation of book debts, cash collateral and personal guarantee of Mr. N. Venkatesh, Director.

Ananya Finance for Inclusive Growth Private Limited

Rate of Interest - 16.00%, loan repayable in 24 monthly installments,

Hypothecation of book debts, cash collateral and 24 no. advance post- dated cheques.

- - 33,33,328 -




28,12,500 - 37,50,000 28,12,500

Edelweiss Housing Finance Limited

Rate of Interest - 16.00%, loan repayable in 12 monthly installments.

Hypothecation of book debts and cash collateral. - - 88,94,796 -

Fed bank Financial Services Limited

Rate of Interest - 12% loan repayable in 36 monthly installments.

Hypothecation of book debts and cash collateral. 1,35,00,000 3,65,00,000

IFMR Capital Finance Private Limited


Hypothecation of book debts and cash collateral. 2,76,64,709 - 3,63,92,671 2,76,64,709


Rate of Interest -15.75%' loan repayable in 24 monthly installments.



Rate of Interest - 14.95% loan repayable in 24 monthly installments.

Hypothecation of book debts and cash collateral. 2,40,25,357 2,05,04,788



Hypothecation of book debts and cash collateral. 2,40,25,357 2,05,04,788 - -

Maanaveeya Development & Finance Private Limited

Rate of Interest - 15.00%, loan repayable in 12 quaterly installments.

Hypothecation of book debts and personal guarantee of Mr. N. Venkatesh and Mr. R.C. Shekar, Director.

- - 1,16,60,000 -

s


Registered Office* N 4 .


Rate of Interest -14.50%, loan repayable in 24 installments.


MAS Financial Services Limited Rate of Interest - MAS PLR + 1.00%, loan repayable in 18 monthly installments.

Hypothecation of book debts, cash collateral and post-dated cheques. - 1,66,66,664 -

Reliance Capital Ltd. Rate of Interest - 15.50%, loan repayable in 12 monthly installments.

Hypothecationof book debts and cash collateral. - - 2,17,72,693 -



Reliance Capital Ltd. Rate of Interest - 13%, loan repayable in 24 monthly installments.

Hypothecation of book debts and cash collateral. 1,42,56,994

, ___ 0 -




Re istered Office: No. 418 112A. 4th Cross 6th Main Wilson Garden. Banaalore -


Hypothecation of book debts and cash collateral.

,

4,67,71,971 5,32,28,029

Reliance Home Finance Ltd. Rate of Interest - 15.50%, loan repayable in 12 monthly installments.


Religare Finvest Limited Rate of Interest - 15.75%, loan repayable in 26 monthly installments.


1,62,32,023 - 2,46,00,794 1,62,32,023



2,49,35,233 1,38,81,848 - -

Small Industries Development Bank of India



- - 1,63,63,650 -

TOTAL 33,67,33,363 24,61,97,121 22,35,08,003 8,51,57,078

Non-Convertible Debentures - Secured

0 ,

Name of Debenture Holder Terms of repayment Security Offered As at 31st March, 2017 As at 31st March, 2016

Current Liabilities Z




Hinduja Leyland Finance Limited

Rate of Interest - 12.78% p.a. calculated on a XIRR bas.s, i principal repayable in 24 monthly installments.

Hypothecation of Book Debts 4,58,33,400 - 5,00,00,000 4,58,33,400


Rate of Interest - 12.51% p.a. calculated on a XIRR bas .s, i principal repayable in 24 monthly installments.

Hypothecation of Book Debts 4,99,99,200 1,25,00,800 -

IFMR Flmpact Long Term Multi Asset Class-Senior Deb


Hypothecation of Book Debts - 5,00,00,000 -

'ts


Registered Office* No 418 112A. 4th -

Mahindra & Mahindra Financial Rate of Interest - 11.40%

Services Ltd loan repayable in 24 monthly installments.

Hypothecation of Book Debts 7,50,00,000 7,50,00,000 - -

TOTAL 17,08,32,600 13,75,00,800 5,00,00,000 4,58,33,400

.,:;•:i a'

b rn

Y , .7..

•ta ,...4.• ,

r LA 0`

)(_, . 4). •S'

• 1",

. • \

) c., ,..Q,

,57

441S. * l'\



Cash Credit - Secured

Name of the Bank Terms of repayment Security Offered

Mat 31st March, 2017 As at 31st March, 2016



Z

Current Liabilities r


Z

Ratnakar Bank Ltd. Rate of Interest - 13.75% loan repayable on demand - Tenor -12 Months

Hypothecation of Book Debts 3,586 - - -

TOTAL 3,586 - - -

Non-Convertible Debentures - Unsecured

Name of Debenture Holder Terms of repayment Security Offered Mat 31st March, 2017 Mat 31st March, 2016





IFMR Flmpact Long Term Multi Asset Class-Sub Debt


No security offered - 5,00,00,000 - -

TOTAL - 5,00,00,000 - -

Vehicle Loan from Banks - Secured

Name of the Bank Terms of repayment Security Offered As at 31st March, 2017 As at 31st March, 2016





Axis Bank Rate of Interest - 10.75%, loan repayable in 60 monthly installments.

Hypothecation of Car - 1,10,880 -

HDFC Bank Rate of Interest - 9.65%, loan repayable in 60 month[Kinstallments.

Hypothecation of Car 1,98,093 6,76,627 1,79,937 8,74,719

TOTAL 1,98,093 6,76,627 2,90,817 8,74,719



Vehicle Loan from Other Parties - Se cur





T



r

Kotak Mahindra Prime Ltd Loan repayable in 36 monthly installments (Monthy EMI).

Hypothecation of Car - - 72,347 -

Kotak Mahindra Prime Ltd Loan repayable In 60 monthly installments (Monthy EMI).

Hypothecation of Car 1,82,522 6,39,316 1,66,457 8,21,838

TOTAL 1,82,522 6,39,316 2,38,804 8,21,838

Note 4.1: The Company has not defaulted in the repayment of dues to banks! financial institutions.



Note 5 - Deferred Tax

PARTICULARS AS PER BOOKS AS PER IT DIFFERENCE TAX @33.063%

1) DEFERRED TAX LIABILITY Fixed asset 2,20,40,639 1,97,76,739 22,63,900 (7,48,513)

2) DEFFERED TAX ASSET Provision for Gratuity 15,70,357 - 15,70,357 5,19,207 Provision for Bonus 8,07,009 - 8,07,009 2,66,821 Provision for Loan portfolio 1,43,65,000 - 143,65,000 47,49,500

47,87,015

Deferred Tax Liability as on 31.03.2017 7,48,513 Opening Balance of Deferred Tax Liability 4,67,988 Provision made in Profit & Loss Account 2,80,525

Deferred Tax Asset as on 31.03.2017 55,35,528 Opening Balance of Deferred Tax Asset 32,91,800 Provision made in Profit & Loss Account 22,43,728

Total Provision made In Profit & Loss Account (19,63,203)

Deferred Tax Asset as on 31.03.2017 (Net) (47,87,015)

SAMASTA MICROFINANCE LIMITED CIN: U65191 KA1995PIC057884

Registered Office: No. 418, 1/2A, 4th Cross, 6th MaIn, Wilson Garden, Bangalore -560027.

Note 6 - Long • Term Provisions

Particulars As at

31st March, 2017 2

Mat 31st March, 2016

1 a) Provision for Employee Benefits:

i) Provision for Gratuity -

b) Other Provisions:

15,70,357 31,49,521

i) Provision for Taxation 76,21,868 22,52,185 ii) Provision for Standard Assets 1,43,65,000 68,06,625 Ili) Provision for CSR activities Opening Balance 50,000 50,000 Add : Provision during the year 50,000 50,000 Less: Utilised during the year 50,000 50,000 Closing Balance 50,000 50,000

Total 2,36,07,225 1,22,58,331

Note 7 - Other Current Liabilities


I 2 a) Current maturities of long-term debt 78,36,37,803 44,44,61,865

b) interest accrued but not due on borrowings

c) Other payables i) Statutory remittances

60,58,172

32,23,654

25,60,190

• 25,20,174 ii) Other liabilities 9,15,99,484 4,79,64,673 iii) Unamortised,gain on securitisation 1,05,88,815 54,70,451 iv) Payable towards securitisation / assignments 1,12,35,945 2,40,731

Total 90,63,43,873 50,32,18,084

Note 8 - Short-Term Provisions

Particulars Mat

31st March, 2017 I


r a) Others i) Tax provision 34,00,000 71,69,683 ii) Proposed Dividend on Preference Shares - 9,00,000 iii) Dividend Distribution Tax on Preference Shares - 1,83,218

Total 34,00,000 82,52,901

L. c 04.

-?••••"

A Ni.c.R.•59 F 0059 i 7S AZ!

A r,,r.g6 •

SAMASTA MICROFINANCE LIMITED CIN: U65191KA1995P1C057884

Registered Office: No. 418,1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027.

Note 9 - Fixed Assets

Fixed Assets Useful Life In Years

Gross Block Depreciation! Amortisation Net Block

Balance as at 1st April, 2016

(?)

Additions during the year

(r)

Deletions during the year

(r)

Balance as at 31st March, 2017

(r)


(r)

Depreciation / Amortisation for the period

Depreciation on sale of

Asset




en

A

B

Tangible Assets

Fumtiure & Fixtures

Office Equipment

Computers

Vehicles

Total (A) Previous Year

Intangible Assets

Computer Softwares

Total (B) Previous Year

Total (A+B) Previous Year

10

5

3

8 & 10

3 & 6

45,45,675

31,86,639

42,59,127

61,80,577

39,98,860

44,26,767

• 77,65,384

-

-

20,500

-

16,74,563

85,44,535

75,92,905

1,20,24,511

45,06,014

20,94,070

17,64,046

26,74,010

16,23,483

9,36,785

7,00,846

16,16,198

9,59,706

-

-

-

10,16,597

30,30,855

24,64,892

42,90,208

15,66,592

55,13,680

' 51,28,013

77,34,303

29,39,422

24,51,605

14,22,593

15,85,117

45,57,094

1,81,72,018 1,61,91,011 16,95,063 3,26,67,965 81,55,609 42,13,535 10,16,597 1,13,52,547 2,13,15,419 1,00,16,410 1,76,85,490 53,49,767 48,63,239 1,81,72,018 72,19,760 22,32,491 12,96,642 81,55,609 1,00,16,410 1,04,65,731

8,56,799 52,27,211 2,35,824 - 54,63,036 43,70,412 3,67,404 - 47,37,816 7,25,220

52,27,211 2,35,824 - 54,63,036 43,70,412 3,67,404 - 47,37,816 7,25,220 8,56,799 51,04,047 1,58,163 34,999 52,27,211 39,34,701 4,65,925 30,214 • 43,70,412 8,56,799 11,69,346

2,33,99,229 1,64,26 835 16,95,063 3,81,31,001 1,25,26,021 45,80,939 10,16,597 1,60,90,363 2,20,40,639 1,08,73 209 2,27,89,537 55,07,930 48,98,238 2,33,99,229_ 1,11,54,461 _ 26,98,416 13,26,856 1,25,26,021 1,08,73,209 80,45,925

TS to, 5, N:4b

. 4 P,I . A.

SAMASTA MICROFINANCE LIMITED C1N: U65191KA1995PLC057884

Registered Office: No. 418, 1/24, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027.

Note 10 - Non-Current Investments

Particulars As at

310 March, 2017 Z


Z a) Trade - Unquoted Investments, at cost I) Investments in Equity instruments 1) Alpha Micro Finance Consultants Pvt. Ltd., 50,000 Equity shares of ? 10/- each fully paid up. (Previous year 50,000 Equity shares of ? 10/- per share)

2) Ayusha Dairy Private Limited (Subsidiary), 1,000,000 Equity shares of? 10.1- each fully paid up. (Previous year 990,000 Equity shares of? 10/- per share)

Total

Aggregate amount of unquoted investments

5,00,000

-

5,00,000

-

5,00,000 5,00,000

5,00,000 5,00,000

Note 11 - Other Non-Current Assets

Particulars As at

31st March, 2017 • Z


Z a) Long term Trade receivables I) Unsecured, Considered Good 1) Trade receivables under financing activity 35,85,39,842 17,78,88,727 II) Unsecured, Considered Doubtful 1) Trade receivables under financing activity 1,06,25,185 3,91,923

36,91,65,027 17,82,80,650

b) Others . I) Deposits with Banks more than 12 months maturity 11,46,81,128 10,15,28,775 0) Deposits with other NBFC for term loans 1,40,62,893 - Hi) Deferred Revenue Expenditure 2,18,28,371 1,12,32,982 iv) Rent Deposits 86,28,750 41,44,000 v) Advance Tax 72,98,900 40,52,000 vi) TDS Receiables 91,71,755 44,37,974 vii) MAT Credit 13,42,390 -

17,70,14,187 12,53,95,731 Total (a+b) 54,61,79,214 30,36,76,381

1 t:t 6c.

Pft RN4005917S

Ars:0N

SAMSTA MICROFINANCE LIMITED CIN: U65191KA1995PLC057884


Note 12 -Trade Receivables

As at Mat Particulars 31st March, 2017 31st March, 2016

r r a) Unsecured, Considered Good Outstanding for a period less than six months from the date they are due for payment b) Unsecured, Considered Doubtful

1,06,64,76,872 50,58,55,221

Outstanding for a period exceeding six months from the date they are due for payment - 32,94,764 19,73,575

Total 1,06,97,71,636 50,78,28,796

Note 13- Cash and Cash Equivalents

Particulars As at

31st March, 2017 z


r a) Balances with Banks (i) In Current accounts

b) Cash on hand

c) Others (i) In Fixed Deposit accounts with maturity less than 12 months & all the deposits are lien noted against the term loans.

\

Total

19,07,05,693

11,48,132

11,24,73,886

2,48,559 19,18,53,825 11,27,22,445

37,46,84,547 3,15,79,868

37,46,84,547 3,15,79,868

56,65,38,372 14,43,02,313

Note 14 - Short-Term Loans and Advances

Particulars As at

31st March, 2017 z


r a) Others I) Unsecured, Considered Good 1) Loans and Advances to employees 8,44,117 9,18,229 2) Prepaid Expenses 33,54,739 34,991 3) Other advances 1,25,45,545 42,77,514 4) Rent paid in advance - 8,00,000

Total 1,67,44,400 60,30,734

Note 15 - Other Current Assets

Particulars As at

31st March, 2017 r


r a) Interest accrued . 2,56,34,429 1,07,46,831 b) Income accrued 1,12,782 23,216 c) Hindustan Unilever Ltd - 19,45,382 d) Orb Energy Pvt Ltd - 81,639 e) Inventory - 1,558 f) Investment in mutual fund 97,46,942 -

Total 3,54,94,153 1,27,98,626

•

* FR'N 0.5917S i!...)

<L.* fi-r, ..,,,c.,co



Note 16 - Revenue from Operations

Particulars For the year ended 31st March, 2017

r

For the year ended 31st March, 2016

7 a) Interest income on Loans 19,71,94,881 15,11,92,794 b) Processing fee on Loans 1,59,85,481 96,66,949 C) Income from securitisation / assignment of loans 2,96,42,588 1,32,80,254 d) Recovery against loans written off 49,072 65,824 e) Income from Business Correspondents 6,44,78,357 1,02,78,034 f) Interest income on fixed deposits (collateral) 1,30,81,047 71,15,063 g) Sale of Milk - 15,27,479 h) Sale of Andslite - 1,17,845 i) Sale of Mineral mixer - 3,750

Total 32,04,31,427 19,32,47,992

Note 17 - Other Income


r


r a) Interest and Other Income I) Interest income on Staff Loans

b) Dividend Income

1,70,904 1,71,927

I) Dividend Income from investments In mutual fund

c) Other Non-Operating Income i) Facilitation fee

72,59,028

2,04,904

23,00,293

47,02,527 ii) Miscellaneous income 3,36,730 2,18,533 it) Profit on sale of fixed assets - 53,118 iv) Service fee 3,55,473 1,20,276 v) Interest on Income tax refund - 70,182

vi) Incentive Income 20,43,963 1,26,23,208

Total 1,03,71,001 2,02,60,064

Note 18 - Employee Benefits Expenses


Z


r a) Salaries and wages 9,05,55,177 3,78,14,367 b) Contributions to provident fund and other funds 69,83,984 25,95,708 c) Employees Gratuity 11,20,776 15,77,665 d) Staff welfare expenses 32,10,450 20,32,474 e) Bonus and incentives . 1,03,03,982 55,76,107

Total 11,21,74,369 4,95,96,321

•ft

1••:,

FAN,. kl '.1°. • 59 ,•-•, '•co " •.:. FRN40059175 , ...- . 0 •


Registered Office: No. 418,1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027. Note 19 - Finance Costs


r


T a) Interest expenses on term loans, cash credit and vehicle loans 10,47,18,180 9,26,50,265 b) Interest expenses on Debentures 2,93,99,786 10,25,671 C) Financial expenses 11,84,174 9,71,302 d) Securitisation and assignment expenses 9,45,652 28,18,801 e) NCD expenses 22,52,263 4,72,757 f) Interest on delayed payment of Advance Tax - 19,683 g) Bank Charges 375 1,321

Total 13,85,00,431 9,79,59,800

Note 20 - Administrative and Other Expenses


. r For the year ended 31st March, 2016

r Advertisement expenses 4,90,892 1,07,272 Auditor's Remuneration (Refer Note (i) below) 2,02,525 1,88,335 Assets written off . - 16,996 Bad Debts Written Off 29,58,880 49,24,627 Brokerage 54,500 58,750 Computer consumables 4,61,126 1,47,884 Directors expenses 2,41,777 1,80,371 Deferred Revenue Expenditure 89,92,277 72,55,889 Donation 30,000 - Electricity and Water charges 6,48,516 4,10,279 Freight outwards 1,87,634 77,545 Insurance-General 9,59,517 5,10,720 Local conveyance 75,45,071 23,02,319 Loss on sale of assets 87,965 19,80,904 Loss of goods 1,558 - Membership Subscription Charges 8,14,573 2,67,919 Milk centre expenses - 53,164 Miscellaneous Expenses 26,017 7,717 Office Maintenance . 23,13,957 10,39,592 Postage & Courier 11,62,985 4,34,851 Printing and Stationery 23,58,770 14,32,049 Provision for Standard Assets 75,58,375 10,27,402 Provision for CSR activities 50,000 50,000 Professional Fees 1,16,77,236 62,08,956 Rates and Taxes 13,05,651 7,09,355 Rent . 89,76,144 50,33,055 Repairs and Maintainance 6,650 1,87,850 Software Maintenance Charges 43,15,663 17,72,798 Telephone Charges 16,61,246 7,87,842 Travelling Expenses 30,21,748 10,22,175 Vehicle Maintenance & Insurance 4,03,055 7,78,545 Website Charges 2,61,256 14,448

Total 6,87,75,566 3,89 89 608

Note I


r


r Auditor's Remuneration (net of service tax input credit) - Statutory Audit Fee - Tax Audit Fee - Other Services

Total

1,37,525 40,000 25,000

1,48,335 40,000

2,02,525 1,88,335

, • •

SA (7. Al.C:or 69 c-, F ,Nti005917S



Notes forming part of the Consolidated Financial Statements

Note 22 — Employee Benefits

Disclosures envisaged in Accounting standard (AS) 15 - Employee Benefits as given below:

22.1 Defined Contribution Plans

During the year, the Company has recognized the following amounts in the statement of profit and loss.

Particulars For the year ended

31st March, 2017 (Z")


(Z) Employers Contribution to Provident & Pension Fund 4,910,772 1,954,783

22.2 Defined Benefit Plans

The Company has funded defined benefit gratuity plan. Every employees who has completed five years or more of service is eligible for gratuity on separation at 15 days basic salary (Last Drawn salary) for each completed year of service.

Consequent to the adoption of AS 15 'Employee Benefits' specified under section 133 of Companies Act, 2013 read with rule 7 of Companies (Accounts) Rules, 2014, the following disclosures have been made as required by standard:

Contribution to Gratuity Fund:

Details of defined benefit plan of gratuity are given below:


31st March, 2017 (Z)


(t) i) Changes in the Present Value of Obligation (PVO)

PVO as at the beginning of the period 3,149,521 1,902,334

Interest Cost 219,015 135,493

Current service cost 795,240 470,921

Past service cost - (non vested benefits) i / - -

Past service cost - (vested benefits) - -

Benefits paid -458,650 -330,478

Actuarial loss/(gain) on obligation (balancing figure) 157,615 971,251

PVO as at the end of the period 3,862,741 3,149,521

ii) Changes in the Fair Value of Plan Assets

& Co

3

E-69 B f,HGAL•a" iS 1000°591 N. S.

(0.4 tt4f ACC,—



Fair value of plan assets as at the beginning of the period - -

Expected return on plan assets 86,290 -

Contributions 2,699,940 330,478

Benefits paid -458,650 -330,478

Actuarial gain/(loss) on plan assets [balancing figure] -35,196 -

Fair value of plan assets as at the end of the period 2,292,384 - iii) Amount recognized in the Balance Sheet and Related Analysis Present value of the obligation 3,862,741 3,149,521

Fair value of plan assets 2,292,384 -

Difference 1,570,357 3,149,521

Unrecognized transitional liability - -

Unrecognized past service cost - non vested benefits - -

Liability recognized in the balance sheet 1,570,357 3,149,521

iv) Expenses recognized in the Profit & Loss Account



Expected return on plan assets -86,290 -

Net actuarial (gain)/loss recognized in the year 192,811 971,251

Transitional Liability recognized in the year . -

Past service cost - non-vested benefits - -

Past service cost - vested benefits - -

Expenses recognized in the statement of profit and loss 1,120,776 1,577,665 v) Major categories of Plan Assets (As percentage of Total Plan Assets)

Government of India Securities 0.00% 0.00%

State Government Securities 0.00% 0.00%

High Quality Corporate Bonds 0.00% 0.00%

Equity shares of listed companies 0.00% 0.00%

Property 0.00% 0.00%

„ 134IGALORE-69 fRNO0059175 4..

-fre„ "ED ACCP-



Insurer Managed 100.00% 0.00%

Mutual Funds 0.00% 0.00%

Bank Deposits 0.00% 0.00%

Total 100.00% 0.00% vi) Principal Actuarial Assumptions (Expressed as weighted averages) Discount Rate 6.80% 7.50%

Salary escalation rate 7.00% 10.00%

Attrition rate 24.00% 24.00%

Expected rate of return on Plan Assets 7.70% 7.70%

vii) Assumptions

Discount rate as per para 78 of AS15R 6.80% 7.50% Salary escalation fixed by the Enterprise as per pare 83-91 and 120[1] of AS15R 7.00'1/0 10.00%

Attrition rate fixed by Enterprise 24.00% 24.00%

Age of Retirement 60 60

Funding Mechanism Insurer Managed Unfunded

Note 23 — Segment Information

The Company is engaged in the business of providing microfinance services by way of loan to poor women who are organized as Joint Liability Groups (JLG) in the rural and urban areas of Karnataka, Tamil Nadu, Goa and Maharashtra. Thus the Company has one reportable segment.

Further, the Company operates in a single geographical segment i.e. domestic.

Note 24— Related Party Disclosures

Related party disclosures as required under the Accounting Standard (AS) - 18 on "Related Party Disclosures" notified in companies (Accounting standard) Rules, 2006 are given below:

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24.1 Names of Related Parties and Nature of Relationship

Description of Relationship As at 31st March, 2017 As at 31st March, 2016

Subsidiary Company Ayusha Dairy Private Limited Ayusha Dairy Private Limited

Key Management Personnel

Mr. N. Venkatesh, Managing Director Mr. D. Shivaprakash, Whole-time Director Mr. R.C.Shekar, Director Mr. T. Anantha kumar, CFO Mr. K J Sutheja, Company Secretary Mr. S. Parthasarathy, CFO Upto 31st May'16

Ms. Ritu Singh, Company Secretary Upto 31st Oct'16

Mr. N. Venkatesh, Managing Director Mr. D. Shivaprakash, Whole-time Director Mr. R.C.Shekar, Director Mr. S. Parthasarathy, CFO Ms. Ritu Singh, Company Secretary

24.2 Transactions with Related Parties

Transaction Related Party For the year ended



(T) Income

Interest on loans and advances to related party

Ayusha Dairy Private Limited Nil 214,176

Service fee to related party Ayusha Dairy Private Limited Nil 2,000,000

Other Transactions

Loans and Advances to Subsidiary Ayusha Dairy Private Limited Nil 7,084 Loans and Advances recovered from Subsidiary

Ayusha Dairy Private Limited Nil 4,226,325

Remuneration to Director

Mr. N. Venkatesh, Managing Director. 33,01,704 2,711,988 Mr. D. Shivaprakash, Whole-time Director 24,01,908 2,038,515

Mr. R.C. Shekar, Director 1,512,718 1,505,292

Reimbursement of expenses to Director

Mr. N. Venkatesh, Managing Director 60,000 107,185

Sitting fee to Independent Directors

•Mr. Badrinarayanan Seshadri, Director 76,222 64,154

Mr. A. Vikraman, Director 85,555 30,626

Mr. A. Ramanathan, Director 80,000 53,154

Remuneration to KMP Mr. S. Parthasarathy, CFO Upto 31st May'16 1,57,926 480,081

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Mr. T. Anantha kumar, CFO From 02nd July'16 8,11,813 Nil Ms. Ritu Singh, Company Secretary Upto 31st Oct'16

83,293 130,344

Mr. K J Sutheja, Company Secretary, from 11th Nov'16 2,50,000 Nil

Remuneration / Sitting fee

Relatives of Directors and Key Management Personnel Ni! Nil

Balance as at year end Investment in Subsidiary (1,000,000 Equity shares of! 10/-each)

Ayusha Dairy Private Limited 10,000,000 10,000,000

Note 25 - Additional information

25.1 Contingent liabilities and commitments (to the extent not provided for)

Particulars As at

31st March, 2017 (?)

As at 318t March, 2016

(Z)

Contingent liabilities Nil Nil

25.2 Disclosure on foreign currency exposure:

Earning in Foreign Exchange in Foreign Currency during the year is Nil (Previous Year Nil)

Expenditure in Foreign Exchange in Foreign Currency during the year is Nil (Previous Year Nil)

25.3 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

There are no Micro and Small Enterprises, to whom the company owes dues, which are outstanding for more than 45 days at the Balance Sheet date. The above information regarding Micro Enterprises and Small Enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the Auditors.

25.4 Asset Classification & Provisioning:

The Company follows Prudential Norms of the Reserve Bank of India with regard to classification in respect of all loans extended to its customer.

The Company complies with the Prudential Norms of the Reserve Bank of India with regard to Income recognition, asset classification and provisioning. The Company is following provisioning norms as recommended vide DNBS.CC.PD.No. 250/03.10.01/2011-12 dated 02nd December, 2011, DNBS.PD/CC.No.263/03.10.038/2011-12 dated 20th March, 2012 and DNBS.(PD).CC.No.347/03.10.38/2013-14 dated 01st July, 2013.

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Accordingly the Company in line with guidelines laid down the DNBS(PD)CC.No. 347/30.10.038/2013-14 dated 01st July, 2013 has provided 1% of the total loan portfolio outstanding as at 31st March, 2017.

Classification of loan portfolio: Loan Portfolio as Loan Portfolio as

Asset Classification on 31.03.2017 on 31.03.2016 (t) (r)

Less than 90 days 1,425,016,714 678,297,011 91 - 180 days 10,625,185 391,923 More than 180 days 837,205 1,973,575 Total loan assets! loan portfolio 1,436,479,104 680,662,509

Provisioning Norms for Loans:

Asset Classification RBI Norms As on 31.03.2017 (Z)

As on 31.03.2016 (Z)

Total loan assets! loan portfolio - A 1% of the

outstanding loan

portfolio 14,364,791 6,806,625

Non-performing assets (91-180 days) 50% 5,312,593 195,962

Non-performing assets (> 180 days) 100% 837,205 1,973,575

TOTAL NPA - B 6,149,798 2,169,537

Provision required - the higher of A) or B) 14,364,791 6,806,625

Less: Provision for loan portfolio already made 6,806,625 5,779,223

Provision made for the year ended 7,558,375 1,027,402

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25.5 Disclosure Pursuant to Reserve Bank of India Notification DNBS.200/CGM (PK)-2008 dated 1st August, 2008 i Capital to risk Assets ratio CRAR com uted as oer the method

Particulars

.

As on 31.03.2017 (Z)

„

As on 31.03.2016 (r)

Tier I Capital 616,191,852 114,208,947 Tier II Capital 64,365,000 16,806,625 Total Capital Funds 680,556,852 131,015,572 Total Risk Weighted Assets 1,533,754,137 737,501,250 CRAR - Tier I Capital (%) 40.17% 15.48% CRAR - Tier II Capital (%) 4.20% 2.28% CRAR (%) 44.37% 17.76% All Fixed Deposits with Banks under lien against term loans availed by the Company. However, considering the converge of secured loans, by assets like book debts etc., the risk weighted with respect to fixed deposits with Banks has been considered as Zero.

ii) Exposure to Real Estate Sector (Direct & Indirect Exposure) — Nil (PY: Nil)

iii) Amount of Subordinated Debt raised as Tier II Capital — Rs. 50,000,000/- (PY: Nil)

iv) Exposure to Capital Markets — Nil (PY: Nil)

v) Ratings assigned during the year

a) MFI Grading — mfR3 rated by CRISIL Ratings (MFI Grading Scale — mfR1 Highest, mfR8 Lowest)

b) Bank loan rating — CRISIL A/Stable rated by CRISIL Ratings

vi) Maturity Pattern of Assets and Liabilities

Maturity pattern of certain items of assets and liabilities as on March 31, 2017 — Amount in Z

Particulars

Liabilities Assets

Borrowings from Banks and others

Market Borrowings

Advances (Loan

portfolio outstanding)

FD with Banks

(Free of Lien)

Investments

Up to one month 72,250,376 - 85,403,308 300,000,000 - Over one month to 2 months 71,772,202 - 92,776,620 - - Over 2 months up to 3 months 76,437,406 - 93,007,334 - - Over 3 months up to 6 months 207,506,555 - 274,542,897 - - Over 6 months to 1 year 355,671,264 - 521,583,918 - - Over 1 year to 3 years 582,148,918 - 369,165,027 - - Over 3 years to 5 years 521,399 - - - - Over 5 years 100,000,000 - - - 10,500,000 Total 1,466,308,120 - 1,436,479,104 300,000,000 10,500,000



25.6 Disclosures of frauds reported during the year vide DNBS PD.CC.No. 256 / 03.10.042 / 2011-12 dated 02nd March, 2012

Less than Z 1 Lakh Z 1 - 5 Lakhs Z 5 - 25 Lakhs Total No. of,.

Accounts

Value n

Lakhs

No. of Accounts

Value Zi n

Lakhs

No. of Accounts

Value Zi n

Lakhs

No. of Accounts

Value Z in

Lakhs

A) Person involved

• Staff

Staff and Customer

-

_

-

• Customer

3 1.15 - 3 1.15

Total . _ 3 1.15 . . 3 1.15

B) Type of fraud

Misappropriation and criminal breach of trust

Fraudulent encashment / Manipulation of books of Accounts

Unauthorized credit facility extended

Cheating and forgery

- -

•

3 1.15 - -

-

3 1.15

_ Total • - - 3 1.15 - - 3 1.15

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25.7 Disclosure as required under DNBS (PD) CC. No. 300/03.10.038/2012-13 dated August 3, 2012

The cap on margins (as defined by Malegam Committee) and in compliance with RBI circular RBI/2012-13/161 DNBS (PD) CC.No.300 /03.10.038/2012-13 03rd August, 2012 is 9.22% as at 31st March, 2017(9.79% as at 31 si March, 2016).

27. Earnings per Share

Particulars For the year ended 318t March, 2017


Profit after Tax (Z) 8,089,888 14,665,322 Weighted Average Number of Equity Shares - Basic 12,283,965 10,470,000 - Diluted 12,283,965 10,470,000 Earnings Per Share - Basic 0.59 1.40 - Diluted 0.59 1.40

Face Value of Shares (Z) 10 10

28. Recognition of MAT Credit

No MAT credit is availed and utilized during the year (previous year Nil/-). No MAT credit is recognized during the year (previous year Nil).

29. Disclosure Pursuant to Reserve Bank of India Notification DNBS.193DG (VL) 2007 dated 22nd February, 2007:

SI No. Particulars As at 31st March, 2017 Amount

Outstanding Amount Overdue

Liabilities (t) (Z)

(1) Loan and Advances availed by the NBFC inclusive of Interest accrued thereon but not paid:

a Debentures - - -4 Secured - - -5 Secured -

(Other than falling the meaning of Public Deposits) -

b Deferred Credits - - c Term Loan 1,106,278,162 - d Inter-corporate Loans & Borrowings - - e Commercial Paper - - f Other Loans — Vehicle Loan

- Non-Convertible Debentures 1,696,558

358,333,400 -

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SI No. Particulars Amount Outstanding

(Z)

31st March, 2017

(2) Break-up of Loans & Advances including Bills Receivables [ Other than those included in (3) below]

(a) Secured (b) Unsecured 1,436,479,104

(3) Breakup of Leased and Stock on Hire and other Assets counting towards AFC activities

(i) Lease assets including Lease rentals accrued and due: -

(a) Finance Lease

(b) Operating Lease

(ii) Stock on Hire including Hire Charges under sundry debtors:

(a) Assets on Hire -

(b) Repossessed Assets

(iii) Other Loans contributing towards AFC Activities

(a) Loans where assets have been repossessed -

(b) Loans other than (a) above


(Z.) 31st March, 2017

(4) Break-up of Investments Current Investments I Quoted:

(i) Shares: (a) Equity (b) Preference

(ii) Debentures and Bonds - (iii) Units of Mutual Funds (iv) Government Securities (v) Others II Unquoted: -

(i) Shares: (a) Equity (b) Preference

(ii) Debentures and Bonds (iii) Units of Mutual Funds (iv) Government Securities (v) Others

Long term Investments

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I Quoted: (i) Shares: (a) Equity -

(b) Preference (ii) Debentures and Bonds - (iii) Units of Mutual Funds (iv) Government Securities (v) Others II Unquoted: (I) Shares: (a) Equity 10,500,000

(b) Preference (ii) Debentures and Bonds - (iii) Units of Mutual Funds (iv) Government Securities - (v) Others

(5) Borrower Group wise classification of Assets Financed as in 2 and 3 above

SI No. Particulars As at 31st March, 2017

Amount in (Z) (Net of Provisions) Secured Unsecured Total

1 (a) Related Parties Subsidiaries - - - (b) Companies in the same group - - - (c) Other Related Parties - - -

2 Other than related parties - 1,422,114,104 1,422,114,104 Total - 1,422,114,104 1,422,114,104

(6) Investor Group-wise classification of all investments (Current and Long Term) in Share and Securities (both Quoted and Unquoted):

SI No. Category

Market Value / Breakup value or Fair Value or

Net Assets Value

Book Value (t)

1 (a) Related Parties Subsidiaries - 10,000,000 (b) Companies in the same group - - (c) Other Related Parties - -

2 Other than related parties - 500,000 Total - 10,500,000

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(8) Other Information Amount in (Z)

(i) Gross Non - Performing Assets (a) Related Parties - (b) Other than related parties 11,462,390

(ii) Net Non - Performing Assets (a) Related Parties - (b) Other than related parties -

(iii) Assets acquired in Satisfaction of Debt -

33. The Company has not disbursed any loan against security of gold.

34. Details of average interest paid on borrowings and charged on loans given to JLGs

Particulars

2016-17 2015-16

Rate of Interest in % for Microfinance loan


Average Rate of Interest on Borrowings 15.19% 16.09%

Average Rate of Interest on Loans given 24.41% 25.88%

Net Interest Margin 9.22% 9.79%

35. Securitization / Assignment of Loans

During the year, the Company has sold loans through direct Securitization / assignments. The information on direct assignment activity of the Company as an Originator / Assignor is as shown below:

Particulars Year ended

March 31, 2017 (r)

Year ended March 31, 2016

(Z)

Total number of loans securitized / assigned 23,917 14,364

Total book value of loans securitized / assigned 231,599,843 253,509,823

Sale consideration received for loans securitized / assigned 253,816,937 259,348,785

Income recognized in the statement of profit and loss 29,642,588 13,280,254

Balance of loans assigned / securitized as at the balance sheet date 175,687,865 218,941,848

Cash collateral provided and outstanding as at the balance sheet date 24,089,612 4,060,415

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Disclosure to be made under Securitization guidelines issued by Reserve Bank of India vide policy no. DNBS. PD. No. 301/3.10.01/2012-13 dated August 21, 2012.

S.No Particulars As on 31.03.2017 (Z)

As on 31.03.2016 (7)

1 No. of SPVs sponsored by the NBFC for Securitization transactions 3 1

2 Total amount of securitized assets as per the books of the SPVs sponsored by the Company 231,599,843 47,830,931

3 Total amount of exposures retained by the Company to comply with MRR as on the date of balance sheet

i) Off-Balance Sheet exposures

a) First Loss -

b) Others

ii) On-Balance Sheet exposures

a) First Loss (in the form of Fixed Deposit) 24,089,612 4,060,415

b) Others -

4 Amount of exposures to securitization transactions other than MRR


a) Exposure to own securitization

First Loss - -

Others - -

b) Exposure to third party securitization transaction

First Loss - -

Others - -



First Loss - -

Others - -

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36. a) Shareholder's agreement and subscription of Shares:

The promoters of the Company have entered into a Shareholders' Agreement with India Infoline Finance Limited on 20th January, 2017 for transfer of 8,417,631 Equity shares of Rs.10 each. Consequent upon the transfer, the Company has become a subsidiary of India Infoline Finance Limited. In the meeting held on 209, March, 2017 the company has issued and allotted 50,000,000 equity shares of Rs.10 each fully paid up to India Infoline Finance Limited and as approved by the members in the Extra- Ordinary General Meeting held on 08th March, 2017.

In the Extra-Ordinary General Meeting held on 08th March, 2017, the shareholders of the Company increased the authorized share capital of the Company from Rs. 425,000,000 consisting of 40,500,000 equity shares of Rs.10 each and 2,000,000 preference shares of Rs.10 each to Rs. 650,000,000 consisting of 63,000,000 equity shares of Rs.10 each and 2,000,000 preference shares of Rs.10 each.

36. b) The details of Specified Bank Notes (SBN) held and transacted during the period 08/11/2016 to 30/12/2016 as provided in the Table below:- Amount in

SBNs Other denomination notes

Total

Closing cash in hand as on 08.11.2016

2,75,500 2,22,828 4,98,328

(+) Cash Collected (EMI, Processing Fee & Insurance)

10,18,57,500 14,67,82,144 24,86,39,644

(-) Permitted payments

Nil Nil Nil

(-) Amount deposited in Banks

10,21,33,000 14,60,91,332 24,82,24,332


Nil 9,13,640 9,13,640

Explanation : For the purposes of this clause, the term 'Specified Bank Notes' shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated the 8th November, 2016.".

37. Discontinued Operations:

The company discontinued its Dairy product business. Accordingly, Dairy product business was treated as a discontinuing operation under Accounting Standard (AS) 24 — Discontinuing Operations. The Dairy product business was operational till 30- April- 2015 afIci Ai§99ntinued thereafter.

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The following tables provide the disclosures relating to the Dairy Product business:

Revenue from operations As at 31st March, 2017 As at 31st March, 2016

Sale of Milk and other dairy products Nil 1,527,479

Mineral Mixer Nil 3,750

Other Income As at 31st March, 2017 As at 31st March, 2016

Profit on sale of asset Nil 6,400

Interest on IT Refund Nil 2,430

Purchases during the year was Nil (PY: Rs.14,99,388/-)

Expenses As at 31st March, 2017 As at 318t March, 2016

Employee Benefit Expense Nil 1,99,802

Depreciation and other expenses Nil 8,573,638

The carrying amounts of the total assets and liabilities pertaining to the Dairy Product business as at March 31, 2017 and March 31, 2016 are as follows.

Other current liabilities As at 31st March, 2017 As at 31st March, 2017

Statutory remittances Nil 27,802

Trade Receivables As at 31st March, 2017 As at 31st March, 2016

Unsecured considered good Nil 2,277,480

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Short term loans and advances As at 31st March, 2017 As at 31st March, 2016

Income tax and advance recoverable Nil 21,500

38. Basis of Consolidation

The financial statements of the following subsidiary company have been consolidated as per Accounting Standard - 21 on 'Consolidated Financial Statements'.

Name of the Subsidiary Country of Incorporation Proportion interest (/o)

of ownership

Ayusha Dairy Private Limited India 100%

39. Previous year Figures

Previous year's figures have been reclassified to conform with the current year's classification / presentation, wherever applicable.

As per our attached report of even date For Gowthama & Company Chartered Accountants Firm No. 00694443 C04„, 44,

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For and on behalf of the Board of Directors

N. Venkatesh D. Shivaprakash Managing Director hole-time Director

M-L-PA-


T. Anantha Kumar Chief Financial Officer

K.J. Suthej Company Secretary

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness •of the accounting estimates made by Company's Directors, as well as evaluating the overall presentation of the financial statements.

We believe that• the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2017;

b) In the case of the Statement of Profit and Loss Account, of the profit for the year ended on that date; and

c) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the `Annexure-A' statement on the matters specified in paragraphs 3 and 4 of the Order to the extent applicable.

2. As required by section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

c) The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

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d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) On the basis of written representations received from the directors as on 31st March, 2017, taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2017, from being appointed as a director in terms of Section 164(2) of the Act.

I) With respect to the adequacy of the internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate report in ‘Annexure-B'

With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company does not have any pending litigations which would impact its financial position.

The Company did not have any long-term contracts including derivatives contracts for which there were any material foreseeable losses; and

There were no amounts which required to be transferred to the Investor Education and Protection Fund by the Company.

iv. The Company had provided requisite disclosures in its financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016.The company being Micro Finance Company, have collected on daily basis loan recoveries and same has been deposited into the bank thereafter and these are in accordance with the books of accounts maintained by the company.

For Gowthama & Company Chartered Accountants Firm No: 0059173 AR572",..zi-;

04\ , H V Gowthama." Place: Bangalore Date: 21.04.2017

Partner CD g fa co mp Mem. No: 01405 00\1

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The Annexure-A referred to in our Report of even date to the members of Samasta Microfinance Limited, on the financial statements of the company for the year ended March 31, 2017.

On the basis of such checks as we considered appropriate and according to the information and explanation given to us during the course of our audit, we report that:

1 (a) The company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) According to the information and explanation explained to us, fixed assets have been physically verified by the management during the year which, in our opinion, is reasonable having regard to the size of the company and the nature of its Assets. No material discrepancies were noticed on such verification.

(c) The company does not hold any immovable properties, therefore this clause is not applicable to the company.

2 According to the information and explanation explained to us, The Company is a Non-Banking Financial Company ('NBFC') engaged •in the business of providing loans. Therefore the provisions of this clause are not applicable to the Company.

3. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has granted loans, secured or unsecured, to companies, in the register maintained under Section 189 of the Act.

a) The terms and conditions of the grant of such loans are not prejudicial to the company's interest

b) In the case of the loans granted to the bodies corporate listed in the register maintained under section 189 of the Act, the borrowers have been regular in the payment of the interest as stipulated. The terms of arrangement do not stipulate any repayment schedule and the loans are repayable on demand.

c) There are no overdue amounts for more than five lakhs in respect of the loans granted to the in the register maintained under Section 189 of the Act.

4. According to the information and explanations given to us, the Company has not given loans, Investments and guarantees to which the provisions of the Section 185 and 186 of the companies Act, 2013 apply. Therefore this clause is not applicable to the company.

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5. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not accepted any deposits covered under section 73 to 76 of the Companies Act or any other relevant provisions of the Companies Act or the rules framed there under or directions issued by RBI. Therefore this clause is not applicable to Company.

6. According to the information and explanations given to us, the Central Government has not prescribed maintenance of cost records under Section 148(1) of the companies act for any services rendered by the Company. Therefore this clause is not applicable to the company.

7. (a) According to the records of the company, undisputed statutory dues including Provident Fund, Employees' State Insurance, Income-tax, Sales Tax, Wealth tax, Duty of customs, Duty of Excise, Value Added Tax and any other statutory dues with the appropriate authorities have generally been regularly deposited with the appropriate authorities. According to the information and explanations given to us there were no outstanding statutory dues as on 31st of March, 2017 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there is no amounts payable in respect of Income Tax, Wealth tax, Sales tax, Service tax, duties of

• customs, duties of excise, Value Added Tax or Cess which have not been deposited on account of any disputes.

8. According to the information and explanations given to us and on the basis of our examination of the books of account, we are of the opinion that, the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

9. According to the information and explanations give to us and in our opinion, the money raised by way Private placed Debt instruments i.e. non Convertible Debenture and term loans were applied for the purpose for which those are raised.

10. According to the information and explanations given to us and based upon the audit procedures performed, we report that no fraud by the Company and no fraud on the company by its officers/employees has been noticed or reported during the year, nor have we been informed of such case by the management.

11. Managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the companies act.

12. According to the information and explanations given to us and in our opinion, the Company is not a Nidhi Company and therefore clause is not applicable.

13. According to the Information and Explanation given to us, all the transactions with the related parties are in compliance with section 188 and 177 and wIrmepplicable the

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details have been disclosed in the financial statements as required by the accounting standard and Companies Act 2013.

14. According to the Information and Explanation given to us, the company has made preferential allotment of shares during the year which is in accordance with Sec 42 of Companies Act, 2013 and the amount raised have been used for the purposes for which the funds were raised.

15. According to the Information and Explanation provided to us, the company has not entered into any Non-cash transactions with Directors or persons connected with him and therefore this clause is not applicable to the company.

16. According to the Information and Explanation given to us, the company has obtained the registration under section 45-IA of the Reserve Bank of India Act, 1934.


For Gowthama & Company Chartered Accountants Firm No: 005917S

CO4p4,

, H V Gowtham aj>-) 0 Partner (D nsc Mem. No: i31445.310

44, tgoit

'ANNEXURE-B' TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE FINANCIAL STATEMENTS OF SAMASTA MICROFINANCE LIMITED

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of Samasta Microfinance Limited ("the Company") as of March 31, 2017 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internal financial controls based on essential components such as the control environment, the entity's risk assessment process, control activities, Information system and communication and the monitoring of such controls. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company's internal financial controls system over financial reporting.

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Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal financial control over financial reporting includes those policies and procedures that

(1) Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

(3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on essential components such as the control environment, the entity's risk assessment process, control activities, Information system and communication and the monitoring of such controls.

For Gowthama and company Chartered Accountants

Firm Reg No: 005917S

-

Date: 21.04.2017 Place: Bangalore

H.V. Gowthanuit .` Partnev c,9

Mem No.: 014a53 1

4

• SAMASTA MICROFINANCE LIMITED • CIN: U65191KA1995PLC057884


Note 1 - Significant Accounting Policies & Notes forming part of the Accounts

1. Basis of Preparation:

The financial statements of the Company have been prepared in accordance with Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standard specified under section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act")/Companies Act 1956, ("the 1956 Act"), as applicable. The financial statements have been prepared on accrual basis and the directions issued by the Reserve Bank of India (RBI) to the extent applicable to the Company.

The Company follows the prudential norms for Income recognition, asset classification and provisioning as prescribed by the RBI for Non-deposit taking Non-Banking Financial Companies (NBFC-MFI).

2. Use of Accounting Estimates:

The presentation of financial statements in conformity with Indian Generally Accepted Accounting Principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Although such estimates are made on a reasonable and prudent basis taking into account all available information, actual results could differ from those estimates.

3. Cash flow statement:

The Cash Flow are reported using the indirect method, whereby profit / (loss) before tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on available information.

4. Provisions and contingent liabilities:

A provision is recognized when the Company has a present legal or constructive obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which reliable estimate can be made. Provisions are not discounted to their present value and are determined based on best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot, i,eregfilVd because it cannot be measured reliably.

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The Company does not recognize a contingent liability but discloses its existence in the financial statements.

5. Income Taxes and Deferred Taxes:

Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax is recognized, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are recognized only if there is virtual certainty that they will be realized and are reviewed every year. The tax effect is calculated on the accumulated timing differences at the end of the year based on enacted or substantially enacted tax rates.

6. Fixed Assets and Depreciation & Amortization:

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.

Depreciation on tangible fixed assets has been provided on the straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013, except in respect of the following category of assets, in whose case the life of the asset has been assessed based on the technical assessment, which takes into account the nature of the asset, its estimated usage, past history or replacement, operating conditions and future technological changes, following is the categories of assets:

Computers - 3 Years

Intangible assets are amortized over their estimated useful life as follows:

Software - 3 Years Servers & Networks- 6 Years

Individual assets costing less than 5,000 each are depreciate fully in the year of purchase.

7. Investments:

Investments which are long term in nature are stated at cost with provisions where necessary for diminution, other than temporary, in the value of Investment.

8. Classification & Provisions of Loan Portfolio:

Loans are classified and provided as per norms required in Non-Banking Financial (Non-Deposit Accepting) Companies Prudential Norms (Reserve Bank) Directions, 2007, as amended from time to time. C941,4

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The Company has got classified as NBFC-MFI and accordingly has provided its provisioning norms for loan portfolio vide RBI circular dated December 02, 2011 as amended vide circular dated March 20, 2012. According to which the provision will be higher of:

a) 1% of the outstanding loan portfolio or b) 50% of the aggregate loan installments which are overdue for more than 90 days and

less than 180 days and 100% of the aggregate loan installments which are overdue for 180 days or more.

9. Trade receivables under Financing Activity:

Trade receivables under financing activity include Income Generating Loan, Dairy Cow Loan / Cattle Loan, Water Purifier Loan, Solar Products Loan and Individual Loan. Loans are classified into 'Performing and Non- Performing assets in terms of the Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998 and NBFC-MFI Directions (as applicable) issued by the Reserve Bank of India as amended from time to time.

10. Revenue Recognition:

a) Revenue from Interest on loans financed by the company is recognized on accrual basis, considering the directions issued by the Reserve Bank of India from time to time in terms of the Non Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998.

b) Interest income on Fixed Deposits with Banks is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

c) Processing fee is recognized as and when collected at the time of loan disbursement.

d) Dividend income from investments in mutual fund is recognized when the right to receive is established.

e) Facilitation fee is recognized on accrual basis according to the terms of agreement.

f) Profit/Premium arising at the time of securitization of loan portfolio is amortized over the life of the underlying loan/portfolio/securities and loss arising thereon is accounted immediately

g) All other income is recognized on an accrual basis, when there is no uncertainty in the ultimate realization / collection. \so & C04,ip

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Registered Office: No. 418, 112A, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027. 11. Borrowing Costs:

Borrowing costs attributable to qualifying assets (assets which require substantial period of time to get ready for their intended use) are capitalized as part of the cost of such assets. All other borrowing costs are charged to revenue.

12. Earnings per Share:

Basic and diluted earnings per share are computed in accordance with Accounting Standard (AS)-20 — Earnings per share. In determining the Earning per Share the Company considers the Net Profit after Tax. The number of Shares used in computing Basic Earning per share is number of share outstanding during the period. The number of shares used in computing diluted earnings per share comprises the weighted average shares considered for deriving basic earnings per share and also the weighted average number of equity shares that could have been issued on the conversion of all dilutive potential equity shares.

13. Employee Benefits:

a) Short Term Employee Benefits:

All employee benefits falling due wholly within twelve months of rendering the services are classified as short term employee benefits, which include benefits like Salary, Allowances and incentives, and are recognized as expenses in the period in which the employee renders the related service.

b) Post- employment Benefits: Defined Contribution Plans:

The Company's contributions to provident fund are considered as defined contribution plans and are charged as an expense as they fall due based on the amount of contribution required to be made.

Defined Benefit Plans:

For defined benefit plans in the form of gratuity, which is not funded, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each Balance Sheet date. Actuarial gains and losses are recognized in the Statement of Profit and Loss in the period in which they occur. Past service cost is recognized immediately to the extent that the benefits are already vested and otherwise is amortized on a straight-line basis over the average period until the benefits become vested. The retirement benefit obligation recognized in the Balance Sheet represents the present value of the defined benefit obligation as adjusted for unrecognized past service cost.

14. General: \& C044p4

Any other accounting policy not specifically referred to are consistent with g rpUy-accerted accounting principles.

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BALANCE SHEET AS AT 3151 MARCH, 2017

Particulars Note No. As at 31st

March, 2017 As at 31st

March, 2016 Z Z

I EQUITY AND LIABILITIES

(1) Shareholder's Funds (a) Share Capital 2 613,446,110 114,700,000 (b) Reserves and Surplus 3 _ 30,086,348 21,598,728

643,532,458 136,298,728 (2) Non-Current Liabilities

(a) Long-term borrowings 4 682,670,317 326,691,099 (b) Long-term provisions 6 23,607,225 12,258,331

706,277,542 338,949,430 (3) Current Liabilities

(a) Other current liabilities 7 906,318,873 503,163,052 (b) Short-term provisions 8 1,450,000 6,452,901

907,768,873 509,615,953

Total 2,257,578,873 984,864,111 It ASSETS

(1) Non-current assets (a) Fixed assets 9

(i) Tangible assets 21,315,419 10,016,410 (ii) Intangible assets 725,220 856,799

(b) Non-current investments 10 10,500,000 ' 10,500,000 (c) Deferred tax assets (Net) 5 4,787,015 ' 2,823,812 (d) Other non-current assets 11 544,347,843 308,797,826

581,675,497 332,994,847 (2) Current assets

(a) Receivables under Financing Activities 12 1,067,314,077 502,381,859 (b) Cash and Cash equivalents 13 566,319,601 130,666,104 (c) Short-term loans and advances 14 16,522,487 6,024,233 (d) Other current assets 15 25,747,211 12,797,068

1,675,903,376 651,869,264 .

Total 2,257,578,873 , 984,864,111


As per our attached report of even date For Gowthama & Company Chartered Accountants ‘4,1\ 15' C044p,g For and on behalf of the Board of Directors

P' Firm No. 005917S izZ's 6.---::Th. te. V ezi- ,,—=. c--OZN ti . cA _SWF-4 (.V .i 4 .1 "i'., tin jerjr •

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'"?- H.V. Gowthama 4''60'1/5 N- 140 A N. Venkatesh D. Shivaprakash

Partner CA, Managing Director Whole-time Director c M. No. 014353 ' 94M8E1 te'e T A1141-AAN- .

T. Anantha Kumar K. J. Sutheja Chief Financial Officer Company Secretary


SAMASTA MICROFINANCE LIMITED CIN: 065191KA1995PLC057884

Registered Office: No. 418, 1/24, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027.

STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH, 2017

Year ended Year ended Particulars Note No. 31st March, 2017 31st March e 2016

Z Z

(A) Revenue from Operations 16 320,431,427 191,598,918 (B) Other Income 17 8,015,861 9,799,712

(C) Total Revenue (MB) 328,447,288 201,398,630

(D) Expenses a) Employee benefits expenses 18 112,174,369 49,396,519 b) Finance costs 19 138,500,056 97,958,479 c) Depreciation and amrotization expenses 9 4,580,939 2,427,364 d) Administrative and Other expenses 20 56,440,374 30,148,397 e) Provision /written off for receivables under financing activity 21 10,517,255 2,538,626

Total Expenses (D) 322,212,993 182,469,385

(E) Profit for the year before tax (C-D) 6,234,295 18,929,245

(F) Tax expenses (a) Current tax 1,450,000 5,350,000 (b) Deferred tax 5 (1,963,203) (1,076,077) (c) MAT Credit entitlement (1,342,390) -

(G) Profit for the year after tax (E-F) 8,089,888 14,655,322

(H) Earnings per Equity Share (Face value of Z10/- each): (a) Basic 0.59 1.40 (b) Diluted 0.59 1.40


As per our attached report of even date For Gowthama & Company 8, c, Chartered Accountant0` u4/0,1,, .

For and on behalf of the Board of Directors

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Partner Managing 4•,,, e Managing Director Whole-time Director M. No. 014353 reliED N

T. Anantha Kumar K. J. Su eja Chief Financial Officer Company Secretary


SAMASTA NIICROFINANCE LIMITED CIN: U65191KA1995PLC057884


CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2017

Particulars Year ended 31st

March, 2017 Year ended 31st

March, 2016 Z Z

CASH FLOW FROM OPERATING ACTIVITIES

Net Profit Before Tax 6,234,295 18,929,245 Adjustments for: Depreciation 4,580,939 2,427,364 Dividend on Mutual funds (6,947,850) (2,300,293) Provisions for Standard and Non Perfoming Assets 7,558,375 1,027,402 Bad Debts Written Off 2,958,880 1,511,224 Interest on Fixed Deposits (13,081,047) (7,115,063) Loss/(Profit) on sale of Fixed assets 87,965 (46,718) Operating Profit before Working Capital Changes A 1,391,557 14,433,161

Working Capital Changes: (Increase)! Decrease in trade and other receivables (567,891,098) (39,559,169) (Increase) / Decrease in Short term loans and advances (10,498,254) (4,183,722) (Increase) / Decrease in Other Current Assets (12,950,143) (5,510,782) (Increase) / Decrease in Loans & Advances (190,884,377) 4,219,241 (Increase)! Decrease in Other Non- Current Assets (35,454,237) (143,062,581) Increase / (Decrease) in Long term Liabilities 0 355,979,218 103,490,702 Increase / (Decrease) in long term provisions (1,579,164) 1,247,187 Increase / (Decrease) in Other current liabilities 403,155,821 138,239,912 Changes in Working Capital B (60,122,234) 54,880,788

Cash generated from operations A+B (58,730,677) 69,313,949 Income taxes paid (7,869,013) (3,443,790) Net cash from operating activities (66,599,690) 65,870,159

CASH FLOW FROM INVESTING ACTIVITIES Sale of Fixed Assets 590,500 300,000 Dividend from Mutual Funds 6,947,850 2,300,293 Purchase of Fixed Assets (16,426,835) (5,507,930) Interest on Fixed Deposits 13,081,047 7,115,063 Net Cash used in Investing activities 4,192,562 4,207,426

CASH FLOW FROM FINANCING ACTIVITIES Proceeds from issue of Equity Share Capital 500,000,000 - Redemption of Preference Share Capital - - Dividends paid (including DDT) (1,939,376) (59,908) Net cash used in financing activities 498,060,624 (59,908)

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CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2017

Particulars Year ended 31st

March, 2017 Year ended 31st

March, 2016 Z Z

Net increase in cash and cash equivalents

Cash and cash equivalents as at 01.04.2016

Cash and cash equivalents as at 31.03.2017

435,653,497

130,666,104

70,017,677

60,648,427

566,319,601 130,666,104

The above Cash Flow Statement has been prepared under the "Indirect Method" as set out in Accounting Standard -3 on Cash Flow Statement.

As per our attached report of even date For Gowthama & Company For and on Chartered Accountantsco..

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behalf of the Board of

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%. D. Shivaprakash Whole-time Director

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H.V. Gowthamar.D op I- r". ,\\-• 9N'IS .7-° N. Venkatesh

Parner -sc N14;4(0 ,... Managing e,e M. No. 014353

""r4.97-ERED tx- (-1: /0-1-41-A-,-9-- T. Anantha Chief Financial


Director ti

. Kumar K. J. Sutheja

Officer Company Secretary



Note 2- Share Capital

Particulars As at

31st March, 2017 Z


Z Authorised:

63,000,000 (Previous year 10,500,000 Equity Shares of Z 10/- each) Equity Shares of Z 10/- each 630,000,000 105,000,000 2,000,000 (Previous year 2,000,000 Preference Shares of Z 10/- each) Preference Shares of Z 10/- each 20,000,000 20,000,000

650,000,000 125,000,000

Issued:

61,344,611 (Previous year 10,470,000 Equity Shares of Z 10/- each) Equity Shares of Z 10/- each 613,446,110 104,700,000 NIL (Previous year 1,000,000 9% Optionally Convertible Preference Shares of Z 10/- each) 9% Optionally Convertible Preference Shares of Z 10/- each - 10,000,000

613,446,110 114,700,000

Subscribed and Paid up:

61,344,611 (Previous year 10,470,000 Equity Shares of Z 10/- each) Equity Shares of Z 10/- each 613,446,110 104,700,000 NIL (Previous year 1,000,0009% Optionally Convertible Preference Shares of Z 10/- each) 9°/0

Optionally Convertible Preference Shares of Z 10/- each - 10,000,000 Total 613,446,110 114,700,000

i) Reconciliation of the number of shares outstanding at the beginning and at the end of As at As at the year: 31st March, 2017 31st March, 2016

Number of shares Number of shares Equity Shares: Number of shares at the beginning of the year 10,470,000 10,470,000 Add: Equity shares issued during the year 50,874,611 - Number of shares at the end of the year • 61,344,611 10,470,000

Preference Shares: Number of shares at the beginning of the year 1,000,000 1,000,000 Add: Preference shares issued during the year - Less: Preference shares converted during the year 1,000,000 - Number of shares at the end of the year - 1,000,000

ii) Number of shares held by each shareholder holding more than 5% shares In the company are as follows: Class of shares! Name of the shareholder


Number of shares Number of shares Equity Shares: India Infoline Finance Limited 58,417,631 - R.C. Shekar - 1,765,020 V.A. Narayanaswamy - 1,048,800 G.J. Krishnaprasad - 552,000 N. Venkatesh - 1,335,840 Kalpathi Investments Pvt Ltd - 1,656,000 B.H.Krishnamurthy - 552,000 Sanjay Shenoy - 683,100 Small Industries Development Bank of India - 1,500,000 Total 58,417,631 9,092,760 Preference Shares: Small Industries Development Bank of India - 1,000,000 Total - 1,000,000

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Registered Office: No. 418,1/2A 4th Cross 6th Main Wilson Garden Bangalore - 560027.

iii) Terms! rights attached to Equity Shares: The Company has Equity Shares having par value of Z 10/- per share. Each holder of Equity Shares is entitled to one vote per share. Holders of Equity Shares are entitled to dividend, in proportion to the paid up amount, proposed by Board of Directors subject to approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts.

iv) Terms / rights attached to Preference Shares: a) Rights/preferences attached to Preference Shares

The dividend on preference shares proposed by the Board of Directors is subject to approval of shareholders in the ensuing Annual General Meeting. Each holder of Preference Share is entitled to one vote per share only on resolutions placed before the Company which directly affect the rights attached to the said shares. In the event of liquidation of the Company before redemption of preference shares, the holders of preference shares will have priority over equity shares in the payment of dividend and repayment of capital and premium thereon but shall not be entitled to any surplus arising thereto.

b) Terms of redemption of Preference Shares

Particulars As at

31st March, 2017 Number of shares

As at 31st March, 2016 Number of shares

i) 9% Optionally Convertible Preference Shares (OCPS) of Z 10/- each. The Company will redeem each of the OCPS (face value of Z 10/-) which is not converted into equity shares at par. The Company will, before such redemption, pay all outstanding dividends on such OCPS to SIDBI. The redemption will be made by the Company as indicated below: 1) 50% of the outstanding OCPS at the end of 5 years 2) Remaining 50% outstanding OCPS at the end of 6 years commencing from the first date of

disbursement/investment/subscription of OCPS by SIDBI in the Company.

1,000,000

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Registered Office: No. 418,1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027.

Note 3 - Reserves and Surplus

Particulars As at

31st March, 2017 Z


Z a) Securities Premium Account

Opening Balance - - Add: Premium on shares issued during the year 1,253,890 - Less: Utilised towards issue of Bonus Shares - - Closing Balance

b) Other Reserve i) Statutory Reserve*

1,253,890 -

Opening Balance 6,132,977 3,182,977 Add: Additions during the year 1,625,000 2,950,000 Closing Balance

c) Surplus

7,757,977 6,132,977

Opening Balance 15,465,751 4,843,647 Add: Profit for the year 8,089,888 14,655,322 Less: Paid / Proposed Dividend on Preference Shareholders 729,863 900,000 Less: Dividend Distribution Tax 126,295 183,218 Less: Transfer to Statutory Reserve* 1,625,000 2,950,000 Closing Balance 21,074,481 15,465,751

Total 30,086,348 21 598 728 required y section ci Reserve Bank of Act,India 1934.

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Registered Office: No. 418,112A, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027.

Note 4 - Long-Term Borrowings

Particulars As at

31st March, 2017 Z


Z a) Term Loans - Secured 1) From Banks (Refer Note 4.1) 247,656,453 194,004,064 2) From Other Parties (Refer Note 4.1) 246,197,121 85,157,078

b) Non-Convertible Debentures - Secured (Refer Note 4.1) 137,500,800 45,833,400

C) Non-Convertible Debentures - Unsecured (Refer Note 4.1) - Tier II Capital

d) Cash Credit - Secured

50,000,000 -

1) From Banks (Refer Note 4.1)

e) Vehicle Loans - Secured

- -

1) From Banks (Refer Note 4.1) 676,627 874,719 2) From Other Parties (Refer Note 4.1) 639,316 821,838

Total 682,670,317 326 691 099



Note 4.1

Term Loan from Banks - Secured

Name of the Bank Terms of repayment Security Offered




Z


Non-current Liabilities Z


Hypothecation of book debts and personal guarantee e Mr. N. Venkatesh and Mr. R.C. Shekar, Director.

- - 16,777,310 -



10,920,000 2,874,738 11,220,715 13,625,725



13,344,000 28,255,787 500,473 2,000,500

Canara Bank Rate of Interest - Base rate + 3.00%, loan repayable in 12 quarterly installments.


10,000,000 5,000,000 10,000,000 15,000,000

Corporation Bank Rate of Interest - Base rate + 2.10%, loan repayable in 12 quarterly installments.

Hypothecation of book debts and personal guarantee of Mr. N. Venkatesh, Director.

- - 4,205,002 _



5,819,882 11,539,154 5,970,242



9,999,996 10,380,872 9,211,381 20,102,769

Kaveri Grameena Bank Rate of Interest - 14.25%, loan repayable in 36 monthly installments.


12,646,933 - 16,666,680 12,853,976

Kaveri Grameena Bank .



16,666,680 17,042,654 1,694,933 3,333,320

Lakshmi Vilas Bank Rate of Interest - Base rate + 2.25%, loan repayable in t, 36 monthly installments .• ‘1-• ',

Ht3cation of book debts and (Siit vi A., lateral , ,V- . *

16,396,547 20,273,934 13,322,555 36,677,4-45


Registered Office: No. 418 1/2A 4th Cross 6th Main Wilson Garden Ban alore -560027.

Lakshmi Vilas Bank Rate of Interest - 12.55% loan repayable in 33 monthly installments.

Hypothecation of book debts and cash collateral 6,666,672 12,777,772 -



3,448,663 - 11,458,816 3,598,134



11,259,481 12,413,177 913,793 2,090,910



3,367,499 6,476,080 - -

Ratnakar Bank Ltd. Rate of Interest - 13.50% loan repayable in 24 monthly installments.


22,857,143 11,428,571


Hypothecation of book debts, cash collateral and personal guarantee of Mr. N. Venkatesh, Mr. D. Shivaprakash, & Mr. R.C. Shekar Director.

3,636,000 3,334,000 3,030,000 6,970,000


Hypothecation of book debts, cash collateral and personal guarantee of Mr. N. Venkatesh, Mr. D. Shivaprakash, & Mr. R.C. Shekar Director.

3,636,000 3,334,000 3,030,000 6,970,000



8,338,000 16,662,000 - -



8,338,000 16,662,000 -

State Bank of India Rate of Interest - 12.25%loan repayable in 36 monthly installments.

Hypothecation of book debts and collateral. cash 40,000,000 54,261,539 - -

State Bank of Mysore Rate of Interest - Base rarcMypothecation + 2.25%, loan repa apte in 33 monthly instal ts...--- —

of book debts, cash coiGferal and personal guarantee of Mr. f‘l..'enkatesh, Director.

-k

10,909,200 2,321,689 10,909,200 13,239,389

e" c `‘9 ;.;, • s z V1̀4

r's•


Registered Office' No 418 1/2A 4th Cross 6th Main. -

State Bank of Patiala Rate of Interest - Base rate + 3.50%, loan repayable in 34 monthly installments.


3,683,751

_

- 10,909,200 3,627,851

State Bank of Travancore Rate of Interest - Base rate + 4.50%, loan repayable in 33 monthly installments.


18,466,503 - 18,180,000 18,661,118


Hypothecation of book debts, cash collateral and personal guarantee of Mr. N. Venkatesh, Mr. D. Shivaprakash and Mr. R.C. Shekar, Director.

- - 847,029 -



7,286,685 8,004,000 7,286,685



8,000,004 13,995,996 8,004,000 21,996,000

UCO Bank Rate of Interest - 11.75% loan repayable in 48 monthly installments.

Hypothecation of book debts and cash collateral. 10,000,000 - - -

YES Bank Ltd. Rate of Interest - 12.25% loan repayable in 48 monthly installments.


10,000,000 10,161,644 - -

TOTAL 275,687,639 247,656,453 170,424,241 194,004,064

6 filv1P4

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Registered Office: No. 418, 1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027. Term Loan from Other Parties Secured



Current Liabilities t


Z



Z

Agri Business Finance Ltd. Rate of Interest - 13% loan repayable in 36 monthly installments.


16,680,000 33,320,000 - -




- - 3,333,328 -




2,812,500 - 3,750,000 2,812,500

Edelweiss Housing Finance Limited



Fedbank Financial Services Limited

Rate of Interest -12% loan repayable in 36 monthly installments.

Hypothecation of book debts and cash collateral. 13,500,000 36,500,000 - -


Rate of Interest -15.75%, loan repayable in 24 monthly installments.

Hypothecation of book debts and cash collateral. 27,664,709 - 36,392,671 27,664,709


Rate of Interest -15.75%, loan repayable in 24 monthly installments.



Rate of Interest -14.95% loan repayable in 24 monthly installments.



Rate of Interest -14.95% loan repayable in 24 monthly installments.



Rate of Interest - 15.00%, loan repayable in 12 quaterly installments.

Hypothecation of book debts and personal guarantee of Mr. N. Venkatesh and Mr. R.C. Shekar, Director.

- - 11,660,000

. COMp, MaanavewirDevelopnfel, & Finance,PTivate-Limited /....:- i-

Rate of Interest - 14.50%, loan repayable in 24 installments.


CD z. LI.N

-4 V ,ACt ,(......Z.,

4 , .44-4 ?...4.-f'


Registered Office: No. 418 1/2A 4th Cross 6th Main Wilson Garden Ban alore -560027.

MAS Financial Services Limited Rate of Interest - MAS PLR + 1.00%, loan repayable in 18 monthly installments.

Hypothecation of book debts, cash collateral and post-dated cheques. - - 16,666,664 -






Hypothecation of book debts and cash collateral. 14,256,994 0 - -





Reliance Home Finance Ltd. Rate of Interest - 15.50%, loan repayable in 12 monthly installments.




16,232,023 - 24,600,794 16,232,023



24,935,233 13,881,848 - -

Small Industries Development Bank of India



- - 16,363,650 -

TOTAL . ......

336,733,363 246,197,121 223,508,003 85,157,078 y

c t— c.

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4 . 05.4 ,sfs' • 4RTERE,,3



Non-Convertible Debentures - Secured







Rate of Interest - 12.78% p.a. calculated on a XIRR basis, principal repayable in 24 monthly installments.

Hypothecation of Book Debts 45,833,400 - 50,000,000 45,833,400

Hinduja Leyland Finance Limited Rate of Interest - 12.78% loan repayable in 24 monthly installments..

Hypothecation of Book Debts 49,999,200 12,500,800 - -

IFMR Flmpact Long Term Multi Asset Class-Senior Deb


Hypothecation of Book Debts - 50,000,000 - -

Mahindra & Mahindra Financial Services Ltd


Hypothecation of Book Debts 75,000,000 75,000,000 - -

TOTAL 170,832,600 137,500,800 50,000,000 45,833,400

Cash Credit - Secured




Z



Z

Ratnakar Bank Ltd. Rate of Interest - 13.75% loan repayable on demand - Tenor -12 Months

Hypothecation of Book Debts 3,586 - - -

TOTAL 3,586 - - -



Non-Convertible Debentures - Unsecured






IFMR Flmpact Long Term Multi Asset Class-Sub Debt


No security offered - 50,000,000 -

TOTAL - 50,000,000 - -

Vehicle Loan from Banks - Secured • •






• Axis Bank


Hypothecation of Car - - 110,880 -

HDFC Bank Rate of Interest - 9.65%, loan repayable in 60 monthly installments.

Hypothecation of Car 198,093 676,627 179,937 874,719

TOTAL 198,093 676,627 290,817 874,719

\••1`I'' c° n'IP4

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SAMASTA MICROFINANCE LIMITED CIN: 1J65191KA1995PLC057884

Registered Office: No. 418, 1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560027. Vehicle Loan from Other Parties - Secured





Z


Non-current Liabilities Z


Hypothecation of Car -- 72,347 -


Hypothecation of Car 182,522 639,316 166,457 821,838

TOTAL 182,522 639,316 238,804 821,838

Note 4.1: The Company has not defaulted in the repayment of dues to banks! financial institutions.

ti M • ' h14



Note 5 - Deferred Tax

PARTICULARS AS PER BOOKS . AS PER IT DIFFERENCE TAX @33.063%

1) DEFERRED TAX LIABILITY Fixed asset 22,040,639 19,776,739 2,263,900 (748,513)

2) DEFFERED TAX ASSET Provision for Gratuity 1,570,357 - 1,570,357 519,207 Provision for Bonus 807,009 - 807,009 266,821 Provision for Loan portfolio 14,365,000 - 14,365,000 4,749,500

4,787,015

Deferred Tax Liability as on 31.03.2017 748,513 Opening Balance of Deferred Tax Liability 467,988 Provision made in Profit & Loss Account 280,525 '

Deferred Tax Asset as on 31.03.2017 5,535,528 Opening Balance of Deferred Tax Asset 3,291,800 Provision made in Profit & Loss Account 2,243,728

Total Provision made In Profit & Loss Account (1,963,203)

Deferred Tax Asset as on 31.03.2017 (Net) (4,787,015)


Registered Office: No. 418,112A, 4th Cross, 6th Main, Wilson Garden, Bangalore -560021.

Note 6 - Long - Term Provisions

Particulars As at

31st March, 2017 2


2 a) Provision for Employee Benefits:

i) Provision for Gratuity

b) Other Provisions:

1,570,357 3,149,521

i) Provision for Taxation 7,621,868 2,252,185 ii) Provision for Loan portfolio 14,365,000 6,806,625 Hi) Provision for CSR activities Opening Balance 50,000 50,000 Add : Provision during the year 50,000 50,000 Less: Utilised during the year 50,000 50,000 Closing Balance 50,000 50,000

Total 23,607,225 12,258,331

Note 7 - Other Current Liabilities

Particulars As at

31st March, 2017 2


2 a) Current maturities of long-term debt 783,637,803 444,461,865

b) Interest accrued but not due on borrowings

c) Other payables i) Statutory remittances

6,058,172

3,221,154

2,560,190

2,492,372 ii) Other liabilities 91,576,984 47,937,443 iii) Unamortised gain on securitisation 10,588,815 5,470,451 iv) Payable towards securitisation / assignments 11,235,945 240,731

Total 906,318,873 503,163,052

Note 8- Short-Term Provisions

Particulars As at

31st March, 2017 2


2 a) Others i) Tax provision 1,450,000 5,369,683 ii) Proposed Dividend on Preference Shares - 900,000 iii) Dividend Distribution Tax on Preference Shares - 183,218

Total 1,450,000 6,452,901

C0MP44,1



Note 9 - Fixed Assets

Fixed Assets Useful Life in Years

Gross Block Depreciation / Amortisation Net Block


(Z)

Additions during the year

(Z)

Deletions during the year

(?)


(Z) 1st April, 2016

(Z)

Balance as at Balance Depreciation! Amortisation for the period

(Z)

Depreciation on sale of

Asset (Z)

as at 31st March, 2017

(Z)


(t)


(r)

A

B

Tangible Assets

Fumtiure & Fixtures

Office Equipment

Computers

Vehicles

Total (A) Previous Year

Intangible Assets

Computer Softwares

Total (B) Previous Year

Total (A+B) Previous Year

10

5

3

8 & 10

3 & 6

4,545,675

3,186,639

4,259,127

6,180,577

3,998,860

4,426,767

7,765,384

-

-

20,500

-

1,674,563

8,544,535

7,592,905

12,024,511

4,506,014

2,094,070

1,764,046

2,674,010

1,623,483

936,785

700,846

1,616,198

959,706

-

-

-

1,016,597

3,030,855

2,464,892

4,290,208

1,566,592

5,513,680

5,128,013

7,734,303

2,939,422

2,451,605

1,422,593

1,585,117

4,557,094

18,172,018 16,191,011 1,695,063 32,667,965 8,155,609 4,213,535 1,016,597 11,352,547 21,315,419 10,016,410 13,304,399 5,349,767 482,148 18,172,018 6,410,794 1,973,681 228,866 8,155,609 10,016,410 6,893,606

5,227,211 235,824 - 5,463,036 4,370,412 367,404 - 4,737,816 725,220 856,799

5,227,211 235,824 - 5,463,036 4,370,412 367,404 - 4,737,816 725,220 856,799 5,069,048 158,163 - 5,227,211 3,916,729 453,683 - 4,370,412 856,799 1,152,319

23,399,229 16,426,835 1,695,063 38,131,001 12,526,021 4,580,939 1,016,597 16,090,363 22,040,639 10,873,209 18,373,447 5,507,930 482,148 23,399,229 10,327,523 2,427,364 228,866 12,526,021 10,873,209 8,045,925


Registered Office: No. 418,1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027.

Note 10- Non-Current investments

Particulars As at

31st March, 2017 2


2 a) Trade - Unquoted Investments, at cost i) Investments in Equity Instruments 1) Alpha Micro Finance Consultants Pvt. Ltd., 50,000 Equity shares of Z 10/- each fully paid up. (Previous year 50,000 Equity shares of Z 10/- per share) 500,000 500,000

2) Ayusha Dairy Private Limited (Subsidiary), 1,000,000 Equity shares of Z 10/- each fully paid up. (Previous year 1,000,000 Equity shares of Z 10/- per share) 10,000,000 10,000,000

Total 10,500,000 10,500,000

Aggregate amount of unquoted investments 10,500,000 10,500,000

Note 11 - Other Non-Current Assets

Particulars As at

31st March, 2017 2


2 a) Long term receivables i) Unsecured, Considered Good 1) Receivables under financing activity 358,539,842 177,888,727 II) Unsecured, Considered Doubtful 1) Receivables under financing activity 10,625,185 391,923

b) Others i) Deposits with Banks more than 12 months maturity

369,165,027 178,280,650

114,681,128 90,118,351 ii) Deposits with other NBFC for term loans 14,062,893 18,251,572 iii) Deferred Revenue Expenditure 21,828,371 11,232,982 iv) Rent Deposits 8,628,750 4,144,000 v) Advance Tax 7,298,900 4,037,000 vi) TDS Receivables 7,340,384 2,733,271 vii) MAT Credit 1,342,390 -

175,182,816 130,517,176 Total (a+b) 544,347,843 308,797,826



Note 12 -Receivables under Financing Activities

Particulars As at

31st March, 2017 Z


2' a) Unsecured, Considered Good Outstanding for a period less than six months from the date they are due for payment b) Unsecured, Considered Doubtful

1,066,476,872 500,408,284

Outstanding for a period exceeding six months from the date they are due for payment 837,205 1,973,575

Total 1,067,314,077 502,381 859

Note 13 - Cash and Cash Equivalents

Particulars As at

31st March, 2017 Z


Z a) Balances with Banks (i) In Current accounts

b) Cash on hand

C) Others (i) In Fixed Deposit accounts with maturity less than 12 months

Total

190,487,432

1,147,622

105,779,810

147,574 191,635,054 105,927,384

374,684,547 24,738,720 374,684,547 24,738,720

566,319,601 130,666,104

Note 14 - Short-Term Loans and Advances

Particulars As at

31st March, 2017 Z


Z a) Others i) Unsecured, Considered Good 1) Loans and Advances to employees 844,117 911,729 2) Prepaid Expenses 3,354,739 34,991 3) Other advances 12,323,632 4,277,514 4) Rent paid in advance - 800,000

Total 16,522,487 6,024 233

Note 15 - Other Current Assets

Particulars As at

31st March, 2017 Z


Z a) Interest accrued 25,634,429 10,746,831 b) Income accrued 112,782 23,216 c) Hindustan Unilever Ltd - 1,945,382 d) Orb Energy Pvt Ltd - 81,639

Total 25,747,211 12,797,068

•e, COMp 4'. 44/j..

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Registered Office: No. 418,112A, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027.

Note 16 - Revenue from Operations


2


2 a) Interest income on Loans 197,194,881 151,192,794 b) Processing fee on Loans 15,985,481 9,666,949 C) Income from securitisation / assignment of loans 29,642,588 13,280,254 d) Recovery against loans written off 49,072 65,824 e) Income from Business Correspondents 64,478,357 10,278,034 f) Interest income on fixed deposits (collateral) 13,081,047 7,115,063

Total 320,431,427 191,598,918

Note 17 - Other income


2


2 a) Interest and Other income i) Interest income on Loans & Advances to Related Parties - 214,176 ii) Interest income on Staff Loans 170,904 171,927 iii) Fee Income from Related Parties

b) Dividend income i) Dividend income from investments in mutual fund

-

6,947,850

2,000,000

2,300,293

C) Other Non-Operating Income i) Facilitation fee 204,904 4,702,527 ii) Miscellaneous income 336,730 176,043 iii) Profit on sale of fixed assets - 46,718 iv) Service fee 355,473 120,276 v) Interest on Income tax refund - 67,752

Total 8,015,861 9,799,712

C OM 44/k

(....c) 0 CD c o.,

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Note 18 - Employee Benefits Expenses


2


2 a) Salaries and wages 90,555,177 37,630,153 b) Contributions to provident fund and other funds 6,983,984 2,595,708 c) Gratuity (Refer Note 22.2) 1,120,776 1,577,665 d) Staff welfare expenses 3,210,450 2,016,886 e) Bonus and incentives 10,303,982 5,576,107

Total 112,174,369 49,396,519

Note 19- Finance Costs.


2


2 a) Interest expenses on term loans, cash credit and vehicle loans 104,718,180 92,650,265 b) Interest expenses on Debentures 29,399,786 1,025,671 c) Financial expenses 1,184,174 971,302 d) Securitisation and assignment expenses 945,652 2,818,801 e) NCO expenses 2,252,263 472,757 f) Interest on delayed payment of Advance Tax - 19,683

Total 138,500,056 97,958,479

Note 20- Administrative and Other Expenses


2


2 Advertisement expenses 490,892 107,272 Auditor's Remuneration (Refer Note (i) below) 175,000 163,335 Brokerage 54,500 58,750 Computer consumables 461,126 147,884 Directors expenses 241,777 180,371 Deferred Revenue Expenditure 8,992,277 7,142,697 Donation 30,000 - Electricity and water charges 648,516 372,080 Insurance - General 959,517 510,720 Local conveyance 7,545,071 2,302,319 Loss on sale of assets 87,965 - Membership Subscription Charges 814,573 267,919 Miscellaneous Expenses 25,922 6,718 Office Maintenance 2,313,957 1,039,592 Postage & Courier 1,162,985 430,592 Printing and Stationery 2,358,770 1,430,299 Provision for CSR activities 50,000 50,000 Professional Fees 10,185,289 6,094,231 Rates and Taxes 1,203,123 694,645 Rent - 8,976,144 4,792,355 Softwar Maintenance Charges 4,315,663 1,772,798 Telephone Charges 1,661,246 776,018 Travelling Expenses 3,021,748 1,016,403 Vehicle Maintenance & Insurance 403,055 778,545 Website Charges 261,256 12,854

Total 56,440,374 30,148,397

Note I



2 Auditor's Remuneration (net of service tax input credit) - Statutory Audit Fee 110,000 123,335 - Tax Audit Fee 40,000 40,000 - Other Services 25,000 -

Total 175,000 163,335 A, uOme.

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Registered Office: No. 418, 1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027. Note 21 - Provision / written off for receivables under financing activity



2 2 Provision for Loan Portfolio 7,558,375 1,027,402 Bad Debts Written Off 2,958,880 1,511,224

Total 10,517,255 2,538 626


• Registered Office: No. 418, 1/2A, 4th Cross, 6th Main, Wilson Garden, Bangalore - 560027.

Notes forming part of the Accounts

Note 22 — Employee Benefits

Disclosures envisaged in Accounting standard (AS) 15 - Employee Benefits as given below:

22.1 Defined Contribution Plans

During the year, the Company has recognized the following amounts in the statement of profit and loss.


315' March, 2017 (Z)


(Z)

Employers Contribution to Provident & Pension Fund 4,910,772 1,954,783

22.2 Defined Benefit Plans

The Company has funded defined benefit gratuity plan. Every employees who has completed five years or more of service is eligible for gratuity on separation at 15 days basic salary (Last Drawn salary) for each completed year of service.

Consequent to the adoption of AS 15 'Employee Benefits' specified under section 133 of Companies Act, 2013 read with rule 7 of Companies (Accounts) Rules, 2014, the following disclosures have been made as required by standard:

Contribution to Gratuity Fund:

Details of defined benefit plan of gratuity are given below:


315' March, 2017 ' (Z)

For the year ended 315' March, 2016

(Z) 1) Changes in the Present Value of Obligation (PVO)

PVO as at the beginning of the period 3,149,521 1,902,334



Past service cost - (non vested benefits) - -

Past service cost - (vested benefits) - -

Benefits paid -458,650 -330,478

Actuarial loss/(gain) on obligation (balancing figure) 157,615 971,251

PVO as at the end of the period 6, it6C2 flef4/ .$' I" 3,149,521

SAMASTA MICROFINANCE LIMITED CIN; U65191KA1995PLC057884


ii) Changes in the Fair Value of Plan Assets

Fair value of plan assets as at the beginning of the period - _

Expected return on plan assets 86,290 -

Contributions 2,699,940 330,478

Benefits paid -458,650 -330,478

Actuarial gain/(loss) on plan assets [balancing figure] -35,196 -

Fair value of plan assets as at the end of the period . 2,292,384 - iii) Amount recognized in the Balance Sheet and Related Analysis

Present value of the obligation 3,862,741 3,149,521

Fair value of plan assets 2,292,384 -

Difference 1,570,357 3,149,521

Unrecognized transitional liability - -

Unrecognized past service cost - non vested benefits - -

Liability recognized in the balance sheet 1,570,357 3,149,521

iv) Expenses recognized in the Profit & Loss Account



Expected return on plan assets -86,290 -

Net actuarial (gain)/loss recognized in the year 192,811 971,251

Transitional Liability recognized in the year - -

Past service cost - non-vested benefits - -

Past service cost - vested benefits - -

Expenses recognized in the statement of profit and loss 1,120,776 1,577,665 v) Major categories of Plan Assets (As percentage of Total Plan Assets)

Government of India Securities 0.00% 0.00%

State Government Securities 0.00% 0.00%

High Quality Corporate Bonds 0.00% 0.00%

Equity shares of listed companies , g, 809,07° 0.00%



Property 0.00% 0.00%

Insurer Managed 100.00% 0.00%

Mutual Funds 0.00% 0.00%

Bank Deposits 0.00% 0.00%

Total 100.00% 0.00% vi) Principal Actuarial Assumptions (Expressed as weighted averages) Discount Rate 6.80% 7.50%

Salary escalation rate 7.00% 10.00%

Attrition rate 24.00% 24.00%

Expected rate of return on Plan Assets 7.70% 0.00%

vii) Assumptions

Discount rate as per para 78 of AS15R 6.80% 7.50% Salary escalation fixed by the Enterprise as per para 83-91 and 120111 of AS15R 7.00°/0 10. 00°/0

Attrition rate fixed by Enterprise 24.00% 24.00%

Age of Retirement 60 60

Funding Mechanism Insurer Managed Unfunded

Note 23 — Segment Information

The Company is engaged in the business of providing microfinance services by way of loan to poor women who are organized as Joint Liability Groups (JLG) in the rural and urban areas of Karnataka, Tamil Nadu, Goa and Maharashtra. Thus the Company has one reportable segment.

Further, the Company operates in a single geographical segment i.e. domestic.

Note 24— Related Party Disclosures

Related party disclosures as required under the Accounting Standard (AS) - 18 on "Related Party Disclosures" notified in companies (Accounting standard) Rules, 2006 are given below:

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24.1 Names of Related Parties and Nature of Relationship

Description of Relationship As at 31st March, 2017 As at 31st March, 2016

Subsidiary Company Ayusha Dairy Private Limited Ayusha Dairy Private Limited Mr. N. Venkatesh, Managing Director Mr. D. Shivaprakash, Whole-time Director Mr. N. Venkatesh, Managing Director

Key Management Personnel Mr. R.C.Shekar, Director Mr. T. Anantha kumar, CFO

Mr. D. Shivaprakash, Whole-time Director

Mr. K J Sutheja, Company Secretary. Mr. R.C.Shekar, Director . Mr. S. Parthasarathy, CFO Mr. S. Parthasarathy, CFO

Upto 31st May'16 Ms. Ritu Singh, Company Secretary Ms. Ritu Singh, Company Secretary Upto 31st Oct'16

24.2 Transactions with Related Parties

Transaction Related Party For the year ended


For the year ended 315t March, 2016

(Z) Income

Interest on loans and advances to related party

Ayusha Dairy Private Limited Nil 214,176

Service fee to related party Ayusha Dairy Private Limited Nil 2,000,000

Other Transactions

Loans and Advances to Subsidiary Ayusha Dairy Private Limited Nil 7,084 Loans and Advances recovered from Subsidiary

Ayusha Dairy Private Limited Nil 4,226,325

Remuneration to Director

Mr. N. Venkatesh, Managing Director 33,01,704 2,711,988 Mr. D. Shivaprakash, Whole-time Director 24,01,908 2,038,515

Mr. R.C. Shekar, Director 1,512,718 1,505,292

Reimbursement of expenses to Director

Mr. N. Venkatesh, Managing Director 60,000 107,185

Sitting fee to Independent Directors

Mr. Badrinarayanan Seshadri, Director 76,222 64,154

Mr. A. Vikraman, Director 85,555 30,626

Mr. A. Ramanathan, Director 80,000 53,154

Remuneration to KMP Mr. S. Parthasarathy, CFO st Upto 31 May'16 2,.. comp,

/1// 1,57,926

-1 480,081



•

Mr. T. Anantha kumar, CFO From 02nd July'16 8,11,813 Nil Ms. Ritu Singh, Company Secretary Upto 31st Oct'16

83,293 130,344

Mr.R. Govindarajan, CFO Upto 22nd Sept 2015 Nil 754,357 Mr. K J Sutheja, Company Secretary, from 11th Nov'16 2,50,000 Nil

Remuneration / Sitting fee

Relatives of Directors and Key Management Personnel Nil Nil

Balance as at year end Investment in Subsidiary (1,000,000 Equity shares of' 10/- each)

Ayusha Dairy Private Limited 10,000,000 10,000,000

Note 25 - Additional information

26.1 Contingent liabilities and commitments (to the extent not provided for)

Particulars As at

31st March, 2017 (?)


(?)

Contingent liabilities Nil Nil

25.2 Disclosure on foreign currency exposure:

Earning in Foreign Exchange in Foreign Currency during the year is Z Nil (Previous Year Z Nil)

Expenditure in Foreign Exchange in Foreign Currency during the year is Z Nil (Previous Year Z Nil)

25.3 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

There are no Micro and Small Enterprises, to whom the company owes dues, which are outstanding for more than 45 days at the Balance Sheet date. The above information regarding Micro Enterprises and Small Enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the Auditors.

25.4 Asset Classification & Provisioning:

The Company follows Prudential Norms of the Reserve Bank of India with regard to classification in respect of all loans extended to its customer.

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The Company complies with the Prudential Norms of the Reserve Bank of India with regard to Income recognition, asset classification and provisioning. The Company is following provisioning norms as recommended vide DNBS.CC.PD.No. 250/03.10.01/2011-12 dated 02nd December, 2011, DNBS.PD/CC.No.263/03.10.038/2011-12 dated 20th March, 2012 and DNBS.(PD).CC.No.347/03.10.38/2013-14 dated 01st July, 2013.

Accordingly the Company in line with guidelines laid down the DNBS(PD)CC.No. 347/30.10.038/2013-14 dated Olst July, 2013 has provided 1% of the total loan portfolio outstanding as at 31st March, 2017.

Classification of loan portfolio: Loan Portfolio as Loan Portfolio as

Asset Classification on 31.03.2017 on 31.03.2016 (Z) (Z)

Less than 90 days 1,425,016,714 678,297,011 91 - 180 days 10,625,185 391,923 More than 180 days 837,205 1,973,575 Total loan assets / loan portfolio 1,436,479,104 680,662,509

Provisioning Norms for Loans:

Asset Classification RBI Norms As on 31.03.2017 (Z)

As on 31.03.2016 (Z)

Total loan assets / loan portfolio - A 1% of the

outstanding loan

portfolio 14,364,791 6,806,625

Non-performing assets (91-180 days) 50% 5,312,593 195,962

Non-performing assets (> 180 days) 100% 837,205 1,973,575

TOTAL NPA - B 6,149,798 2,169,537

Provision required - the higher of A) or B) 14,364,791 6,806,625

Less: Provision for loan portfolio already made 6,806,625 5,779,223

Provision made for the year ended 7,558,375 1,027,402

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25.5 Disclosure Pursuant to Reserve Bank of India Notification DNBS.200/CGM (PK)-2008 dated 1st August, 2008 i) Capital to risk Assets ratio CRAR (computed as per the method prescribed by RBI

Particulars As on 31.03.2017 (Z)

As on 31.03.2016 (Z)

Tier I Capital 616,191,852 114,208,947 Tier II Capital 64,365,000 16,806,625 Total Capital Funds 680,556,852 131,015,572 Total Risk Weighted Assets 1,533,754,137 737,501,250 CRAR - Tier I Capital (%) 40.17% 15.48% CRAR - Tier H Capital (%) 4.20% 2.28% CRAR (%) 44.37% 17.76% All Fixed epos s with Banks under lien against term loans availed by the Company. However, considering the converge of secured loans, by assets like book debts etc., the risk weighted with respect to fixed deposits with Banks has been considered as Zero.

ii) Exposure to Real Estate Sector (Direct & Indirect Exposure) — Nil (PY: Nil)

iii) Amount of Subordinated Debt raised as Tier II Capital — Rs. 50,000,000/- (PY: Nil)

iv) Exposure to Capital Markets — Nil (PY: Nil)

v) Ratings assigned during the year

a) MFI Grading — mfR3 rated by CRISIL Ratings (WI Grading Scale — mfR1 Highest, mfR8 Lowest)

b) Bank loan rating - CRISIL A/Stable rated by CRISIL Ratings

vi) Maturity Pattern of Assets and Liabilities

Maturity pattern of certain items of assets and liabilities as on March 31. 2017—

Particulars

Liabilities Assets

Borrowings from Banks and others

Market Borrowings

Advances (Loan

portfolio outstanding)

FD with Banks

(Free of Lien)

Investments

Up to one month 72,250,376 - 85,403,308 300,000,000 - Over one month to 2 months 71,772,202 - 92,776,620 - - Over 2 months up to 3 months 76,437,406 - 93,007,334 - - Over 3 months up to 6 months 207,506,555 - 274,542,897 - - Over 6 months to 1 year 355,671,264 - 521,583,918 - - Over 1 year to 3 years 582,148,918 - 369,165,027 - - Over 3 years to 5 years 521,399 - - - Over 5 years 100,000,000 - - - 10,500,000 Total 1,466,308,120 - 1j4, 9'I . — 300,000,000 10,500,000

SAMASTA MICROFINANCE LIMITED U65191KA1995PLC057884


25.6 Disclosures of frauds reported during the year vide DNBS PD.CC.No. 256 / 03.10.042 / 2011-12 dated Ord March, 2012

Less than Z 1 Lakh Z 1 - 5 Lakhs Z 5 - 25 Lakhs Total No. of

Accounts

Value Z in

Lakhs

No. of Accounts

Value Z in

Lakhs

No. of Accounts

Value Z in

Lakhs

No. of Accounts

Value Z in

Lakhs

A) Person involved

Staff

Customer

Staff and Customer

-

.

_

- 3

-

1.15

-

_

-

.

-

-

-

_

3 1.15

-

Total - - 3 1.15 - - 3 1.15

B) Type of fraud

Misappropriation and criminal breach of trust

Fraudulent encashment / Manipulation of books of Accounts

Unauthorized credit facility extended

Cheating and forgery

_

-

-_

- 3

_

1.15

_

-

-

-

-

_

_

3 1.15

-

Total - . 3 1.15 - - 3 1.15



25.7 Disclosure as required under DNBS (PD) CC. No. 300/03.10.038/2012-13 dated August 3, 2012

The cap on margins (as defined by Malegam Committee) and in compliance with RBI circular RBI/2012-13/161 DNBS (PD) CC.No.300 /03.10.038/2012-13 03rd August, 2012 is 9.22% as at 31st March, 2017 (9.79% as at 31st March, 2016).

26. Earnings per Share

Particulars For the year ended 316' March, 2017

For the year ended 316' March, 2016

Profit after Tax (Z) 8,089,888 14,665,322 Weighted Average Number of Equity Shares - Basic 12,283,965 10,470,000 -Diluted 12,283,965 10,470,000

Earnings Per Share - Basic . 0.59 1.40 - Diluted 0.59 1.40

Face Value of Shares (Z) 10 10

27. Recognition of MAT Credit

No MAT credit is availed and utilized during the year (previous year Nil/-). No MAT credit is recognized during the year (previous year Nil).

28. Disclosure Pursuant to Reserve Bank of India Notification DNBS.193DG (VL) 2007 dated 22nd February, 2007:

SI No. Particulars As at 316' March, 2017 Amount

Outstanding Amount Overdue

Liabilities (Z) (Z)

(1 ) Loan and Advances availed by the NBFC inclusive of Interest accrued thereon but not paid:

A Debentures - Secured - - - Unsecured

(Other than falling the meaning of Public Deposits)

B Deferred Credits - _ C Term Loan 1,106,278,162 D Inter-corporate Loans & Borrowings E. Commercial Paper - F Public Deposits G Other Loans — Vehicle Loan

- Non-Convertible Debentures.1,36 1,696,558 iffi Of 4,400



SI No. Particulars (Z) Amount Outstanding

31 5t March, 2017

(2) Break-up of (1) (f) above (Outstanding public deposits inclusive of interest accrued thereon but not paid)

(a) In the form of Unsecured debentures

(b) In the form of partly secured debentures i.e, debentures where there is a shortfall in the value of security

(c)Other public deposits

Assets

(3) Break-up of Loans & Advances including Bills Receivables [ Other than those included in (4) below]

(a) Secured - . (b) Unsecured 1,436,479,104

(4) Breakup of Leased and Stock on Hire and other Assets counting towards AFC activities _

(i) Lease assets including Lease rentals under sundry debtors: _ (a) Finance Lease

- (b) Operating Lease _

(ii) Stock on Hire including Hire Charges under sundry debtors: _

(a) Assets on Hire -

(b) Repossessed Assets _ (iii) Other Loans counting towards AFC Activities

- (a) Loans where assets have been repossessed _

(b) Loans other than (a) above _

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(Z) 31st MarCh, 2017

(5) Break-up of Investments Current Investments - I Quoted: -

(i) Shares: (a) Equity - (b) Preference -

(ii) Debentures and Bonds - (iii) Units of Mutual Funds - (iv) Government Securities - (v) Others - II Unquoted: -

(i) Shares: (a) Equity - • (b) Preference -

(ii) Debentures and Bonds - (iii) Units of Mutual Funds - (iv) Government Securities - (v) Others -

Long term Investments . _ I Quoted: _

(i) Shares: (a) Equity - (b) Preference -

(ii) Debentures and Bonds - (iii) Units of Mutual Funds - (iv) Government Securities _ (v) Others - II Unquoted: _

(i) Shares: (a) Equity 10,500,000 (b) Preference -

(ii) Debentures and Bonds - (iii) Units of Mutual Funds - (iv) Government Securities - (v) Others -

(6) Borrower Group wise classification of Assets Pinanced as in 3 n

SI No. Particulars As at 31st March, 2017

Amount in (Z) (Net of Provisions) Total Secured Unsecured

1 Related Parties (a)Subsidiaries - - - (b) Companies in the same group - - - (c) Other Related Parties - - -

2 Other than related parties - 1,422,114,104 1,422,114,104 Total - 1,422,114,104 1,422,114,104

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(7) Investor Group-wise classification of all investments (Current and Long Term) in Share and Securities (both Quoted and Unquoted):

SI No. Category

Market Value I Breakup value or Fair Value or

Net Assets Value

Book Value (?)

1 Related Parties (a)Subsidiaries - 10,000,000 (b) Companies in the Same group - - (c) Other Related Parties - -

2 Other than related parties - 500,000 Total - 10,500,000

(8) Other Information Amount in (?)

(i) Gross Non - Performing Assets (a) Related Parties - (b) Other than related parties 11,462,390

(ii) Net Non - Performing Assets (a) Related Parties - (b) Other than related parties -

(iii) Assets acquired in Satisfaction of Debt -

29. The Company has not disbursed any loan against security of gold.

30. Details of average interest paid on borrowings and charged on loans given to JLGs

Particulars

2016-17 2015-16



Average Rate of Interest on Borrowings 15.19% 16.09%

Average Rate of Interest on Loans given g 24.41% 25.88%

Net Interest Margin 9.22% 9.79%



31. Securitization / Assignment of Loans

During the year, the Company has sold loans through direct Securitization / assignments. The information on direct assignment activity of the Company as an Originator / Assignor is as shown below:

Particulars Year ended

March 31, 2017 (Z)

Year ended March 31, 2016

CO Total number of loans securitized / assigned 23,917 14,364 Total book value of loans securitized / assigned 231,599,843 253,509,823 Sale consideration received for loans securitized / assigned 253,816,937 259,348,785 Income recognized in the statement of profit and loss 29,642,588 13,280,254 Balance of loans assigned / securitized as at the balance sheet date 175,687,865 218,941,848 Cash•collateral provided and outstanding as at the balance sheet date 24,089,612 4,060,415

Disclosure to be made under Securitization guidelines issued by Reserve Bank of India vide policy no. DNBS. PD. No. 301/3.10.01/2012-13 dated August 21, 2012.

S.N o Particuars I As on 31.03.2017 (Z)

As on 31.03.2016 (Z)

1 No. of SPVs sponsored by the NBFC for Securitizatidn transactions 3 1

2 Total amount of securitized assets as per the books of the SPVs sponsored by the Company 231,599,843 47,830,931

3 Total amount of exposures retained by the Company to comply with MRR as on the date of balance sheet

i) Off-Balance Sheet exposures •

a) First Loss - -

b) Others - -


a) First Loss (in the form of Fixed Deposit) 24,089,612 4,060,415

b) Others -

4 Amount of exposures to securitization transactions other than MRR





First Loss -

Others - -


First Loss - -

Others - -



First Loss - -

Others - -


First Loss - -

Others - -

32. Shareholder's agreement and subscription of Shares:

The promoters of the Company have entered into a Shareholders' Agreement with India Infoline Finance Limited on 20th January, 2017 for transfer of 8,417,631 Equity shares of Rs.10 each. Consequent upon the transfer, the Company has become a subsidiary of India Infoline Finance Limited. In the meeting held on 20th March, 2017 the company has issued and allotted 50,000,000 equity shares of Rs.10 each fully paid up to India Infoline Finance Limited and as approved by the members in the Extra- Ordinary General Meeting held on 08th March, 2017.

In the Extra-Ordinary General Meeting held on 08th March, 2017, the shareholders of the Company increased the authorized share capital of the Company from Rs. 425,000,000 consisting of 40,500,000 equity shares of Rs.10 each and 2,000,000 preference shares of Rs.10 each to Rs. 650,000,000 consisting of 63,000,000 equity shares of Rs.10 each and 2,000,000 preference shares of Rs.10 each.

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SAMASTA MICROFINANCE LIMITED GIN: U65191KA1995PLC057884


33. The details of Specified Bank Notes (SBN) held and transacted during the period 08/11/2016 to 30/12/2016 as provided in the Table below:-

SBNs Other denomination notes

Total


2,75,500 2,22,828 4,98,328

(+) Cash Collected (EMI, Processing Fee & Insurance)

10,18,57,500 14,67,82,144 24,86,39,644

(-) Permitted payments

Nil Nil Nil

(-) Amount deposited in Banks

10,21,33,000 14,60,91,332 24,82,24,332


Nil 9,13,640 9,13,640

Explanation: For the purposes of this clause, the term 'Specified Bank Notes' shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated the 8th November, 2016.".

34. Previous year Figures

Previous year's figures have been reclassified to conform with the current year's classification / presentation, wherever applicable.

As per our attached report of even date For and on behalf of the Board of Directors For Gowthama & Company Chartered Accountants Firm No. 00591. A'

H.V.Gowthama ‘,1G0-(1°7 N. Venkatesh 00 tr, 9' - Partner 0 00 Managing Director çlhole.time Director M.No. 014353 (1` tie)

T. Anantha Kumar K.J. Sutheja • " Chief Financial Officer Company Secretary


A-41,17: D. Shivaprakash

independent auditors' report to the … · the company has got classified as nbfc-mfi and...

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