Prospectus

September 7, 2020

MUTHOOTTU MINI FINANCIERS LIMITED

Muthoottu Mini Financiers Limited (“our Company” or “the Company” or “the Issuer”) was originally incorporated as ‘Muthoottu Mini Financiers Private Limited’, a private limited
company under the provisions of the Companies Act, 1956, pursuant to a certificate of incorporation dated March 18, 1998 issued by Registrar of Companies, Kerala and Lakshadweep
(“RoC”). Pursuant to a special resolution passed in the general meeting of our Shareholders held on September 14, 2013, our Company was converted into a public limited company and
a fresh certificate of incorporation was issued by the RoC on November 27, 2013, and our name was changed to ‘Muthoottu Mini Financiers Limited’. Our Company holds a certificate
of registration dated April 13, 2002 bearing registration number N-16.00175 issued by the Reserve Bank of India (“RBI”) to carry on the activities of a non-banking financial company
without accepting public deposits under Section 45 IA of the Reserve Bank of India Act, 1934. Pursuant to the name change of our Company, a fresh certificate of registration dated January
1, 2014, was issued by RBI. For further details about our Company, see “History and Certain Other Corporate Matters” on page 105.
Corporate Identification Number: U65910KL1998PLC012154
Registered Office: 2/994, Muthoottu Buildings, Kozhencherry, Pathanamthitta – 689 641, Kerala, India; Telephone: +91 468 231 4391; Facsimile: NA
Corporate Office: Muthoottu Royal Towers, Kaloor, Kochi – 682 017, Kerala, India; Telephone: +91 484 291 2100; Facsimile: NA
Compliance Officer and Contact Person: Smitha K. S.; Telephone: +91 484 291 2178; Facsimile: NA
E-mail: cs@[Link]; Website: [Link]
PUBLIC ISSUE BY OUR COMPANY OF SECURED, REDEEMABLE, NON-CONVERTIBLE DEBENTURES OF FACE VALUE OF `1,000 EACH (“NCDS”),
AGGREGATING UP TO `10,000 LAKHS (HEREINAFTER REFERRED TO AS THE “BASE ISSUE”), WITH AN OPTION TO RETAIN OVER-SUBSCRIPTION
UP TO `10,000 LAKHS, AGGREGATING UP TO `20,000 LAKHS (HEREINAFTER REFERRED TO AS THE “ISSUE”). THE ISSUE IS BEING MADE
PURSUANT TO THE PROVISIONS OF SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE AND LISTING OF DEBT SECURITIES) REGULATIONS, 2008,
AS AMENDED, AND THE COMPANIES ACT, 2013 AND RULES MADE THEREUNDER, AS AMENDED.
OUR PROMOTERS
Our Promoters are Nizzy Mathew and Mathew Muthoottu. For further details see, “Our Promoters” on page 115.
GENERAL RISKS
For taking an investment decision, the Investors must rely on their own examination of the Issuer and the Issue, including the risks involved. Specific attention of the Investors
is invited to the chapter titled “Risk Factors” on page 16 and “Material Developments” on page 124, before making an investment in this Issue. This Prospectus has not been
and will not be approved by any regulatory authority in India, including the RBI, the Securities and Exchange Board of India (“SEBI”), the RoC or any stock exchange in India.
ISSUER’S ABSOLUTE RESPONSIBILITY
The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Prospectus contains all information with regard to the Issuer and the Issue,
which is material in the context of the Issue, that the information contained in this Prospectus is true and correct in all material respects and is not misleading in any material
respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this Prospectus as a whole or any of
such information or the expression of any such opinions or intentions misleading in any material respect.
CREDIT RATING
Our Company has received rating of ‘IND BBB’: Outlook Stable’ by India Ratings vide its letter dated August 14, 2020 for the NCDs for an amount up to `40,000 lakhs including
NCDs proposed to be issued pursuant to this Issue. The rating of the NCDs by India Ratings and Research Private Limited indicate that instruments with this rating are considered
to have moderate degree of safety regarding timely servicing of financial obligations and carry moderate credit risk. The ratings provided by India Ratings and Research Private
Limited may be suspended, withdrawn or revised at any time by the assigning rating agency and should be evaluated independently of any other rating. These ratings are not a
recommendation to buy, sell or hold securities and Investors should take their own decisions. Please refer to Annexure II on page 242 for the rationale for the above rating.
COUPON RATE, COUPON PAYMENT FREQUENCY, REDEMPTION RATE, REDEMPTION AMOUNT & ELIGIBLE INVESTORS
For details relating to Coupon Rate, Coupon Payment Frequency, Redemption Date, Redemption Amount and eligible Investors of the NCDs, please see “Issue Structure” on page 136.
LISTING
The NCDs offered through this Prospectus are proposed to be listed on the BSE Limited (“BSE”). Our Company has obtained ‘in-principle’ approval for the Issue from BSE vide
its letter dated August 27, 2020. BSE shall be the Designated Stock Exchange for this Issue.
PUBLIC COMMENTS
The Draft Prospectus was filed with BSE, pursuant to the Regulation 6(2) of the SEBI Debt Regulations to be kept open for public comments for a period of 7 (seven) Working
Days , i.e. until 5 pm on August 27, 2020.

LEAD MANAGER TO THE ISSUE DEBENTURE TRUSTEE* REGISTRAR TO THE ISSUE

VIVRO FINANCIAL SERVICES PRIVATE LIMITED VISTRA ITCL (INDIA) LIMITED LINK INTIME INDIA PRIVATE LIMITED
607/608 Marathon Icon The IL&FS Financial Center C-101, 247 Park
Opp. Peninsula Corporate Park Plot C – 22, G Block L.B.S. Marg
Off. Ganpatrao Kadam Marg Bandra Kurla Complex Vikhroli (West)
Veer Santaji Lane, Lower Parel Bandra (East), Mumbai – 400 051. Mumbai – 400 083, Maharashtra, India
Mumbai - 400 013, Maharashtra, India Telephone: +91 22 4918 6200
Telephone: +91 22 2659 3333
Telephone: +91 22 6666 8040/41/42 Facsimile: +91 22 4918 6195
Facsimile: +91 22 6666 8047 Facsimile: +91 22 2653 3297 Email: ncd2.mmfl2020@[Link]
Email: mmfl@[Link] Email: itclcomplianceofficer@[Link] Website: [Link]
Website: [Link] Website: [Link] Investor Grievance Email:
Investor Grievance Email: investors@[Link] Investor Grievance Email: itclcomplianceofficer@[Link] ncd2.mmfl2020@[Link]
Contact Person/Compliance Officer: Jayesh Vithlani Contact Person: Jatin Chonani – Compliance Officer Contact Person: Shanti Gopalkrishnan
SEBI Registration Number: INM000010122 SEBI Registration Number: IND000000578 SEBI Registration Number: INR000004058
ISSUE PROGRAMME
ISSUE OPENS ON SEPTEMBER 9, 2020 ISSUE CLOSES ON OCTOBER 6, 2020**
*Vistra ITCL (India) Limited, by its letter dated August 7, 2020, has given its consent for its appointment as Debenture Trustee to the Issue and for its name to be included in this
Prospectus and in all the subsequent periodical communications sent to the holders of the Debenture issued pursuant to this Issue. For further details, please refer to “General
Information – Debenture Trustee” on page 39.
**The Issue shall remain open for subscription on Working Days from 10:00 a.m. to 5:00 p.m. (Indian Standard Time), during the period indicated above, except that the Issue may
close on such earlier date or extended date (subject to a period of maximum 30 days from the date of the Prospectus) as may be decided by the Board of Directors of our Company
(“Board”) or the Debenture Committee. In the event of such an early closure of or extension subscription list of the Issue, our Company shall ensure that notice of such early closure
or extension is given to the prospective investors through an advertisement in a reputed national daily newspaper with wide circulation on or before such earlier date or extended
date of closure. Applications Forms for the Issue will be accepted only from 10:00 a.m. to 5:00 p.m. (Indian Standard Time) or such extended time as may be permitted by BSE, on
Working Days during the Issue Period. On the Issue Closing Date, Application Forms will be accepted only between 10:00 a.m. to 3:00 p.m. and uploaded until 5:00 p.m. (Indian
Standard Time) or such extended time as may be permitted by BSE.
A copy of the Prospectus and written consents of our Directors, our Company Secretary and Compliance Officer, our Chief Financial Officer, our Auditor, the Lead Manager, the
Registrar to the Issue, Public Issue Account Bank, Refund Bank, Credit Rating Agency, the legal advisor, the Bankers to our Company, the Debenture Trustee, and the Syndicate
Member to act in their respective capacities shall be filed with the RoC, in terms of Section 26 of the Companies Act, 2013 along with the requisite endorsed/certified copies of all
requisite documents. For further details, please see “Material Contracts and Documents for Inspection” beginning on page 237.
 TABLE OF CONTENTS

SECTION I - GENERAL ........................................................................................................................................................ 2

DEFINITIONS AND ABBREVIATIONS ............................................................................................................ 2
PRESENTATION OF FINANCIAL, INDUSTRY AND OTHER INFORMATION ......................................... 12
FORWARD LOOKING STATEMENTS ........................................................................................................... 14
SECTION II - RISK FACTORS .......................................................................................................................................... 16
SECTION III – INTRODUCTION ...................................................................................................................................... 37
GENERAL INFORMATION ............................................................................................................................. 37
CAPITAL STRUCTURE .................................................................................................................................... 44
STATEMENT OF TAX BENEFITS AVAILABLE TO THE DEBENTURE HOLDERS ................................. 51
OBJECTS OF THE ISSUE ................................................................................................................................. 61
SECTION IV - ABOUT OUR COMPANY ......................................................................................................................... 64
INDUSTRY OVERVIEW ................................................................................................................................... 64
OUR BUSINESS ................................................................................................................................................. 87
HISTORY AND CERTAIN OTHER CORPORATE MATTERS .................................................................... 105
OUR MANAGEMENT ...................................................................................................................................... 108
OUR PROMOTERS .......................................................................................................................................... 115
RELATED PARTY TRANSACTIONS ............................................................................................................. 117
SECTION V - FINANCIAL INFORMATION ................................................................................................................. 118
FINANCIAL STATEMENTS ............................................................................................................................ 118
SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN INDIAN GAAP AND IND AS ........................ 119
MATERIAL DEVELOPMENTS....................................................................................................................... 124
FINANCIAL INDEBTEDNESS ........................................................................................................................ 126
SECTION VI – ISSUE RELATED INFORMATION ...................................................................................................... 136
ISSUE STRUCTURE ......................................................................................................................................... 136
TERMS OF THE ISSUE .................................................................................................................................... 143
ISSUE PROCEDURE ........................................................................................................................................ 157
SECTION VII - LEGAL AND OTHER INFORMATION .............................................................................................. 181
OUTSTANDING LITIGATIONS ..................................................................................................................... 181
OTHER REGULATORY AND STATUTORY DISCLOSURES ...................................................................... 193
KEY REGULATIONS AND POLICIES ........................................................................................................... 204
SECTION VIII - SUMMARY OF MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION ........................ 217
SECTION IX - OTHER INFORMATION ........................................................................................................................ 237
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION ........................................................... 237
DECLARATION ................................................................................................................................................................. 239
ANNEXURE I ...................................................................................................................................................................... 240
ANNEXURE II..................................................................................................................................................................... 242
ANNEXURE III ................................................................................................................................................................... 243
ANNEXURE IV ................................................................................................................................................................... 244
ANNEXURE V ..................................................................................................................................................................... 245
 Muthoottu Mini Financiers Limited

SECTION I - GENERAL

DEFINITIONS AND ABBREVIATIONS

Unless the context otherwise indicates, all references in this Prospectus to “Issuer”, “our Company”, “the
Company” or “MMFL” are to Muthoottu Mini Financiers Limited, a company incorporated under the Companies
Act, 1956, registered as non-deposit taking systemically important non-banking financial company with the
Reserve Bank of India under Section 45-IA of the Reserve Bank of India Act, 1934. The Registered Office is
situated at 2/994, Muthoottu Buildings, Kozhencherry, Pathanamthitta – 689 641, Kerala, India.

Unless specified elsewhere or the context otherwise indicates, all references in this Prospectus to “we” or “us” or
“our” are to our Company.

Unless the context otherwise indicates or implies, the following terms have the following meanings in this
Prospectus, and references to any legislation, act, regulation, rules, guidelines or policies shall be to such
legislation, act, regulation, rules, guidelines or policies as amended from time to time.

Company Related Terms

Term Description
AoA/Articles/Articles of Articles of Association of our Company, as amended from time to time
Association
Auditor/Statutory Auditor Vishnu Rajendran & Co.
Asset Under Management / For the year ended March 31, 2020, AUM represents gross loans including
AUM interest receivables without considering the impact of impairment loss allowance
and impact of effective interest rate in accordance with IND AS
For the year ended March 31, 2019, March 31, 2018, March 31, 2017 and March
31, 2016, AUM represents aggregate value of outstanding loans including
outstanding interest but before adjustment for provisions for NPA in accordance
with IGAAP
Audited Ind AS Financial The audited Ind AS financial statement comprising of balance sheet as at March
Statements 31, 2020 and the statement of profit and loss for the Fiscal 2020, the statement of
cash flows for the Fiscal 2020 and the statement of changes in equity for the
Fiscal 2020 and a summary of the significant accounting policies and other
explanatory information for the Fiscal 2020, prepared in accordance with Ind AS,
as audited by the Statutory Auditors of our Company
Board/Board of Directors Board of directors of our Company or any duly constituted committee thereof
Company Secretary The company secretary of our Company, i.e. Smitha K. S.
Compliance Officer The compliance officer of our Company appointed in relation to this Issue, i.e.
Smitha K. S.
Corporate Office The corporate office of our Company, situated at Muthoottu Royal Towers,
Kaloor, Kochi – 682 017, Kerala, India
Debenture Committee The committee of the Board of Directors of the Company constituted for the
purposes of, inter alia, issuance of debentures of the Company. For further
details, see “Our Management” on page 108
Equity Shares Equity shares of face value of ` 100 each of our Company
KMP/Key Managerial The key managerial personnel of our Company in accordance with the provisions
Personnel of the Companies Act, 2013. For details, see “Our Management” on page 108
Group Companies/Muthoottu Muthoottu Mini Theatres Private Limited, Muthoottu Mini Hotels Private
Mini Group Limited, Mini Muthoottu Credit India Private Limited, Mini Muthoottu Nirman
& Real Estate Private Limited, Kandamath Cine Enterprises Private Limited,
Kozhencherry MM Financial Services Private Limited, R M M Properties India
Private Limited, Kozhencherry Properties India Private Limited, Mini Muthoottu
Nidhi Kerala Limited, Muthoottu Mini Nidhi Limited and Cochin Mini
Muthoottu Nidhi Limited
Loan Assets Assets under financing activities
Memorandum/MoA/Memora Memorandum of association of our Company, as amended from time to time
ndum of Association

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 Muthoottu Mini Financiers Limited

Term Description
NBFC Non-banking financial company as defined under Section 45-IA of the RBI Act,
1934
Promoters Nizzy Mathew and Mathew Muthoottu
Reformatted Standalone The reformatted standalone statement of assets and liabilities as at March 31,
Financial 2019, March 31, 2018, March 31, 2017 and March 31, 2016, and the schedules
Statements/Reformatted forming part thereof; reformatted standalone statement of profits and losses for
Financial Statements each of the years March 31, 2019, March 31, 2018, March 31, 2017 and March
31, 2016, and the schedules forming part thereof, and the reformatted standalone
statement of cash flows for each of the years ended March 31, 2019, March 31,
2018, March 31, 2017 and March 31, 2016, the statement of significant
accounting policies, and other explanatory statements.

The audited financial statements of the Company as at and for the years ended
March 31, 2019, March 31, 2018, March 31, 2017 and March 31, 2016prepared
in accordance with IGAAP form the basis for such Reformatted Financial
Statements
Reformatted Financial Report The report dated August 14, 2020 on the Reformatted Financial Statements,
prepared by the Statutory Auditor
Registered Office The registered office of our Company is situated at 2/994, Muthoottu Buildings,
Kozhencherry, Pathanamthitta – 689 641, Kerala, India
Risk Management Committee The committee of the Board of Directors of the Company constituted for the
purposes of, inter alia, to assist the Board in the execution of its risk management
accountabilities. For further details, see “Our Management” on page 108
RoC Registrar of Companies, Kerala and Lakshadweep
Shareholders The shareholders of our Company

Issue Related Terms

Term Description
Abridged Prospectus A memorandum containing the salient features of the Prospectus
Acknowledgement Slip The slip or document issued by the Designated Intermediary to an Applicant as
proof of registration of the Application Form
Allotment Advice The communication sent to the Allottees conveying the details of NCDs allotted
to the Allottees in accordance with the Basis of Allotment
Allot/Allotment/Allotted The issue and allotment of the NCDs to successful Applicants pursuant to the
Issue
Allottee(s) The successful Applicant to whom the NCDs are being/have been Allotted
pursuant to the Issue
Applicant/Investor Any prospective applicant who makes an Application pursuant to the Prospectus
and the Application Form
Application/ An application (whether physical or electronic) to subscribe to the NCDs offered
ASBA Application pursuant to the Issue by submission of a valid Application Form and authorising
an SCSB to block the Application Amount in the ASBA Account which will be
considered as the application for Allotment in terms of the Prospectus
Application Amount The aggregate value of NCDs applied for, as indicated in the Application Form
for the Issue
Application Form/ Form in terms of which an Applicant shall make an offer to subscribe to NCDs
ASBA Form through the ASBA process and which will be considered as the Application for
Allotment of NCDs and in terms of the Prospectus
Application Supported by The Application (whether physical or electronic) used by an ASBA Applicant to
Blocked Amount/ASBA make an Application by authorising the SCSB to block the Application Amount
in the specified bank account maintained with such SCSB
ASBA Account An account maintained with a SCSB and specified in the Application Form which
will be blocked by such SCSB to the extent of the Application Amount in relation
to the Application Form by an ASBA Applicant
Base Issue `10,000 lakhs

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 Muthoottu Mini Financiers Limited

Term Description
Basis of Allotment The basis on which NCDs will be allotted to successful applicants under the Issue
and which is described in “Issue Procedure – Basis of Allotment” on page 175
Broker Centres Broker centres notified by the Stock Exchange, where Applicants can submit the
Application Forms to a Trading Member. The details of such Broker Centres,
along with the names and contact details of the Trading Members are available
on the website of the Stock Exchange
Business Days All days excluding Saturdays, Sundays or a public holiday in India or at any other
payment centre notified in terms of the Negotiable Instruments Act, 1881
Client ID Client identification number maintained with one of the Depositories in relation
to the demat account
Collection Centres Centres at which the Designated Intermediaries shall accept the Application
Forms, being the Designated Branch for SCSBs, Specified Locations for the
Syndicate, Broker Centres for registered brokers, Designated RTA Locations for
CRTAs and Designated CDP Locations for CDPs
Collecting Depository A depository participant, as defined under the Depositories Act, 1996 and
Participants/CDPs registered under the SEBI Act and who is eligible to procure Applications at the
Designated CDP Locations in terms of the Debt Application Circular
Collecting Registrar and Registrar and share transfer agents registered with SEBI and eligible to procure
Share Transfer Applications at the Designated RTA Locations in terms of the Debt Application
Agents/CRTAs Circular
Credit Rating Agency For the present Issue, the credit rating agency being, India Ratings and Research
Private Limited
Coupon Rate / Interest Rate The aggregate rate of interest payable in connection with the NCDs in accordance
with the Prospectus. For further details, see “Issue Structure” on page 136
Debenture Trust Deed The trust deed to be executed by our Company and the Debenture Trustee for
creating the security over the NCDs issued under the Issue
Debenture Trusteeship Debenture Trusteeship Agreement dated August 7, 2020 entered into between our
Agreement Company and the Debenture Trustee
Debentures/NCDs Secured, redeemable, non-convertible debentures issued pursuant to the Issue
Deemed Date of Allotment The date of issue of the Allotment Advice, or such date as may be determined by
the Board or Debenture Committee and notified to the Stock Exchange. All
benefits relating to the NCDs including interest on the NCDs shall be available to
the Investors from the Deemed Date of Allotment. The actual Allotment of NCDs
may take place on a date other than the Deemed Date of Allotment
Debt Application Circular Circular No. CIR/IMD/DF-1/20/2012 issued by SEBI on July 27, 2012 as
modified by circular (No. CIR/IMD/DF/18/2013) dated October 29, 2013 issued
by SEBI and circular no. CIR/DDHS/P/121/2018 dated August 16, 2018 issued
by SEBI
Demographic Details The demographic details of an Applicant such as his address, bank account
details, category, PAN etc. for printing on refund/interest orders or used for
refunding through electronic mode as applicable
Depositories Act The Depositories Act, 1996
Depository(ies) National Securities Depository Limited and/or Central Depository Services
(India) Limited
Designated Branches Such branches of the SCSBs which shall collect the Application Forms used by
the ASBA Applicants and a list of which is available at [Link]
or at such other web-link as may be prescribed by SEBI from time to time
Designated CDP Locations Such centres of the Collecting Depository Participants where Applicants can
submit the Application Forms. The details of such Designated CDP Locations,
along with the names and contact details of the CDPs are available on the website
of the Stock Exchange and updated from time to time
Designated Date The date on which the Registrar to the Issue issues instruction to SCSBs for
unblocking of funds from the ASBA Accounts to the Public Issue Account in
terms of the Prospectus and the Public Issue Account Agreement and following
which the Board, shall Allot the NCDs to the successful Applicants

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 Muthoottu Mini Financiers Limited

Term Description
Designated Intermediaries The Members of the Syndicate, SCSBs, Trading Members, RTAs and CDPs who
are authorized to collect Application Forms from the Applicants, in relation to the
Issue
Designated Stock BSE Limited
Exchange/DSE
Designated RTA Locations Such centres of the CRTAs where Applicants can submit the Application Forms.
The details of such Designated RTA Locations, along with the names and contact
details of the CRTAs are available on the website of the Stock Exchange
([Link]) and updated from time to time
DP/Depository Participant A depository participant as defined under the Depositories Act
Direct Online Application The application made using an online interface enabling direct application by
Investors to a public issue of their debt securities with an online payment facility
through a recognised stock exchange. This facility is available only for demat
account holders who wish to hold the NCDs pursuant to the Issue in
dematerialised form. Please note that the Applicants will not have the option to
apply for NCDs under the Issue, through the direct online applications mechanism
of the Stock Exchange
Draft Prospectus The Draft Prospectus dated August 19, 2020 was filed with the Designated Stock
Exchange and with SEBI for receiving public comments, in accordance with the
provisions of the Companies Act, 2013 and the SEBI Debt Regulations
Existing Secured Creditors The South Indian Bank Limited, Union Bank of India (erstwhile Andhra Bank),
Dhanlaxmi Bank Limited, Punjab National Bank (erstwhile Oriental Bank of
Commerce), State Bank of India, IndusInd Bank Limited, HDFC Bank Limited,
the debenture holders of the privately placed secured non-convertible debentures
and debenture holders of the secured non-convertible debentures issued by way
of public issues
Fugitive Economic Offender Fugitive economic offender means an individual who is declared a fugitive
economic offender under Section 12 of the Fugitive Economic Offenders Act,
2018
India Ratings India Ratings and Research Private Limited
Interest Payment Date / The dates on which interest/coupon on the NCDs shall fall due for payment which
Coupon Payment Date will be specified in the Prospectus. Please see “Issue Structure – Interest and
Payment of Interest” on page 140
Institutional Portion Portion of Applications received from Category I of persons eligible to apply for
the Issue which includes resident public financial institutions as defined under
Section 2(72) of the Companies Act 2013, statutory corporations including state
industrial development corporations, scheduled commercial banks, co-operative
banks and regional rural banks, and multilateral and bilateral development
financial institutions, which are authorised to invest in the NCDs, provident funds
of minimum corpus of `2,500 lakhs, pension funds of minimum corpus of `2,500
lakhs, superannuation funds and gratuity fund, which are authorised to invest in
the NCDs, resident venture capital funds and/or alternative investment funds
registered with SEBI, insurance companies registered with the IRDAI, national
investment fund (set up by resolution no. F. No. 2/3/2005-DDII dated November
23, 2005 of the Government of India and published in the Gazette of India),
insurance funds set up and managed by the Indian army, navy or the air force of
the Union of India or by the Department of Posts, India, mutual funds registered
with SEBI and systemically important non-banking financial companies
Issue Public issue by our Company of NCDs aggregating up to `10,000 lakhs, with an
option to retain over-subscription up to `10,000 lakhs, aggregating up to `20,000
lakhs, on the terms and in the manner set forth herein
Issue Closing Date October 6, 2020
Issue Opening Date September 9, 2020
Issue Size Public issue by our Company of NCDs aggregating up to `10,000 lakhs, with an
option to retain over-subscription up to `10,000 lakhs, aggregating up to `20,000
lakhs
Lead Manager Vivro Financial Services Private Limited

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 Muthoottu Mini Financiers Limited

Term Description
Market Lot 1 (one) NCD
Maturity Amount In respect of NCDs Allotted to NCD Holders, the repayment of the face value of
the NCD along with interest that may have accrued as on the redemption date
NCD Holder/Debenture Any debenture holder who holds the NCDs issued pursuant to this Issue and
Holder whose name appears on the beneficial owners list provided by the Depositories
Non-Institutional Portion Category II of persons eligible to apply for the Issue which includes companies
falling within the meaning of Section 2(20) of the Companies Act 2013; bodies
corporate and societies registered under the applicable laws in India and
authorised to invest in the NCDs, educational institutions and associations of
persons and/or bodies established pursuant to or registered under any central or
state statutory enactment; which are authorised to invest in the NCDs, trust
including public/private charitable/religious trusts which are authorised to invest
in the NCDs, association of persons, scientific and/or industrial research
organisations, which are authorised to invest in the NCDs, partnership firms in
the name of the partners, limited liability partnerships formed and registered
under the provisions of the Limited Liability Partnership Act, 2008 (No. 6 of
2009), resident Indian individuals and Hindu undivided families through the
Karta aggregating to a value exceeding `5 lakhs
Prospectus This Prospectus dated September 7, 2020 to be filed with the RoC in accordance
with the SEBI Debt Regulations, containing inter alia the Coupon Rate for the
NCDs and certain other information
Public Issue Account Account(s) opened with the Public Issue Account Bank to receive monies from
the ASBA Accounts maintained with the SCSBs on the Designated Date
Public Issue Account Bank HDFC Bank Limited
Public Issue Account The agreement dated August 26, 2020 entered into amongst our Company, the
Agreement Registrar, the Public Issue Account Bank, the Refund Bank and the Lead Manager
for collection of the Application Amounts from ASBA Accounts and where
applicable, refunds of the amounts collected from the Applicants on the terms and
conditions thereof
Record Date The record date for payment of interest in connection with the NCDs or repayment
of principal in connection therewith shall be 7 Working Days prior to the date on
which interest is due and payable, and/or the date of redemption. Provided that
trading in the NCDs shall remain suspended between the aforementioned Record
Date in connection with redemption of NCDs and the date of redemption or as
prescribed by the Stock Exchange, as the case may be

In case Record Date falls on a day when Stock Exchange is having a trading
holiday, the immediate subsequent trading day will be deemed as the Record Date
Refund Account Account opened with the Refund Bank from which refunds, if any, of the whole or
any part of the Application Amount shall be made and as specified in the Prospectus
Refund Bank HDFC Bank Limited
Registrar to the Link Intime India Private Limited
Issue/Registrar
Register of NCD Holders The statutory register in connection with any NCDs which are held in physical
form on account of rematerialisation, containing name and prescribed details of
the relevant NCD Holders, which will be prepared and maintained by our
Company/Registrar in terms of the applicable provisions of the Companies Act
RTAs/ Registrar and Share The registrar and share transfer agents registered with SEBI and eligible to
Transfer Agents procure Application in the Issue at the Designated RTA Locations
SCSBs or Self Certified The banks registered with SEBI under the Securities and Exchange Board of India
Syndicate Banks (Bankers to an Issue) Regulations, 1994 offering services in relation to ASBA,
including blocking of an ASBA Account, and a list of which is available on
[Link] or at such other web-link as may be prescribed by SEBI
from time to time. A list of the branches of the SCSBs where ASBA Applications
submitted to the Lead Manager, Members of the Syndicate or the Trading
Member(s) of the Stock Exchange, will be forwarded by such Lead Manager,
Members of the Syndicate or the Trading Members of the Stock Exchange is

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 Muthoottu Mini Financiers Limited

Term Description
available at [Link] or at such other web-link as may be
prescribed by SEBI from time to time
Security The principal amount of the NCDs to be issued in terms of this Prospectus
together with all interest due on the NCDs, as well as all costs, charges, all fees,
remuneration of Debenture Trustee and expenses payable in respect thereof shall
be secured by way of first ranking pari passu charge with Existing Secured
Creditors, on current assets, including book debts, loans and advances, cash and
bank balances (not including reserves created in accordance with law) and
receivables, both present and future of the Company
Specified Locations Collection centres where the Members of the Syndicate shall accept Application
Forms, a list of which is included in the Application Form
Stock Exchange BSE Limited
Syndicate ASBA Applications through the Designated Intermediaries
Syndicate ASBA Application Collection centres where the Designated Intermediaries shall accept Application
Locations Forms from Applicants, a list of which is available on the website of the SEBI at
[Link] and at such other websites as may be prescribed by SEBI
from time to time
Syndicate SCSB Branches In relation to ASBA Applications submitted to a Member of the Syndicate, such
branches of the SCSBs at the Syndicate ASBA Application Locations named by
the SCSBs to receive deposits of the Application Forms from the members of the
Syndicate, and a list of which is available on [Link] or at such
other website as may be prescribed by SEBI from time to time
Tenor Tenor shall mean the tenor of the NCDs which will be specified in the Prospectus
Trading Member(s) Individuals or companies registered with SEBI as “trading member(s)” under the
SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992, and who hold the right
to trade in stocks listed on stock exchanges, through which Investors can buy or
sell securities listed on stock exchanges whose list is available on stock exchanges
Transaction Registration The acknowledgement slips or document issued by any of the Members of the
Slip/TRS Syndicate, the SCSBs, or the Trading Members as the case may be, to an
Applicant upon demand as proof of upload of the Application on the application
platform of the Stock Exchange
Tripartite Agreement(s) Agreements as entered into between the Issuer, Registrar and each of the
Depositories under the terms of which the Depositories shall act as depositories
for the securities issued by our Company
Trustee/Debenture Trustee Trustee for the holders of the NCDs, in this case being Vistra ITCL (India)
Limited
Wilful Defaulter A person who is categorised as a wilful defaulter by any bank or financial
institution or consortium thereof, in accordance with the guidelines on wilful
defaulters issued by the RBI and includes an issuer whose director or promoter is
categorised as such
Working Days All days excluding Sundays or a holiday of commercial banks in Mumbai and/or
Kochi, except with reference to Issue Period, where Working Days shall mean all
days, excluding Saturdays, Sundays and public holiday in India. Furthermore, for
the purpose of post issue period, i.e. period beginning from the Issue Closing Date
to listing of the NCDs on the Stock Exchange, Working Day shall mean all trading
days of the Stock Exchange, excluding Sundays and bank holidays in Mumbai, as
per the SEBI Circular CIR/DDHS/P/121/2018 dated August 16, 2018, however,
with reference to payment of interest/redemption amount of NCDs, Working
Days shall mean those days wherein the money market is functioning in Mumbai

Business/Industry Related Terms

Term Description
ALM Asset Liability Management
ALCO Asset Liability Committee
CRAR Capital-To-Risk-Weighted Assets Ratio

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 Muthoottu Mini Financiers Limited

Term Description
DPN Demand Promissory Note
EMI Equated Monthly Instalments
FIR First Information Report
Gross Spread Yield on the average minus the cost of funds
HFC Housing Finance Company
IMF International Monetary Fund
IND AS Indian Accounting Standards
IRR IRR Advisory Services Private Limited
IRR Report Report titled “Gold Loan Industry in India”, dated August 9, 2020, prepared
and issued by IRR Advisory Services Private Limited
KYC/KYC Norms Customer identification procedure for opening of accounts and monitoring
transactions of suspicious nature followed by NBFCs for the purpose of
reporting it to appropriate authority
LTV Loan to value
Master Directions RBI’s Master Direction – Non-Banking Financial Company – Systemically
Important Non-Deposit taking Company and Deposit taking Company
(Reserve Bank) Directions, 2016 dated September 1, 2016, as amended
NAV Net Asset Value
NBFC Non-Banking Financial Company as defined under Section 45-IA of the
RBI Act, 1934
NBFC-D NBFC registered as a deposit accepting NBFC
NBFC-ND NBFC registered as a non-deposit accepting NBFC
NBFC-ND-SI Systemically Important NBFC-ND, i.e. a non-banking financial company
not accepting / holding public deposits and having total assets of `50,000
lakhs and above, as per the last audited balance sheet
NOF Net Owned Fund
NPA Non-performing asset
Public Issue 1 Public issue of secured non-convertible debentures of face value `1,000
each aggregating to `19,559 lakhs pursuant to the prospectus dated
February 12, 2014
Public Issue 2 Public issue of secured and unsecured non-convertible debentures of face
value `1,000 each aggregating to `24,963 lakhs pursuant to the prospectus
dated July 7, 2014
Public Issue 3 Public issue of secured and unsecured non-convertible debentures of face
value `1,000 each aggregating to `26,913 lakhs pursuant to the prospectus
dated September 23, 2014
Public Issue 4 Public issue of secured and unsecured non-convertible debentures of face
value `1,000 each aggregating to `24,909 lakhs pursuant to the prospectus
dated February 18, 2015
Public Issue 5 Public issue of secured non-convertible debentures of face value `1,000
each aggregating to `22,827 lakhs pursuant to the prospectus dated July 10,
2015
Public Issue 6 Public issue of secured and unsecured non-convertible debentures of face
value `1,000 each aggregating to `24,401 lakhs pursuant to the prospectus
dated December 21, 2015
Public Issue 7 Public issue of secured non-convertible debentures of face value `1,000
each aggregating to `11,672 lakhs pursuant to the prospectus dated March
12, 2019
Public Issue 8 Public issue of secured non-convertible debentures of face value `1,000
each aggregating to `13,203 lakhs pursuant to the prospectus dated July 29,
2019
Public Issue 9 Public issue of secured non-convertible debentures of face value `1,000
each aggregating to `17,593 lakhs pursuant to the prospectus dated January
14, 2020

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 Muthoottu Mini Financiers Limited

Term Description
Public Issue 10 Public issue of secured non-convertible debentures of face value `1,000
each aggregating to ` 19,791 lakhs pursuant to the prospectus dated May
29, 2020
SME Small and medium enterprises
Tier I Capital Tier I capital means owned fund as reduced by investment in shares of other
non-banking financial companies and in shares, debentures, bonds,
outstanding loans and advances including hire purchase and lease finance
made to and deposits with subsidiaries and companies in the same group
exceeding, in aggregate, ten per cent of the owned fund; and perpetual debt
instruments issued by a non-deposit taking non-banking financial company
in each year to the extent it does not exceed 15% of the aggregate Tier I
Capital of such company as on March 31 of the previous accounting year
Tier II Capital Tier II capital includes the following:

(a) preference shares other than those which are compulsorily convertible
into equity;
(b) revaluation reserves at discounted rate of fifty five percent;
(c) General Provisions (including that for Standard Assets) and loss
reserves to the extent these are not attributable to actual diminution in
value or identifiable potential loss in any specific asset and are
available to meet unexpected losses, to the extent of one and one fourth
percent of risk weighted assets;
(d) hybrid debt capital instruments;
(e) subordinated debt; and
(f) perpetual debt instruments issued by a non-deposit taking non-banking
financial company which is in excess of what qualifies for Tier I
Capital, to the extent the aggregate does not exceed Tier I Capital
WGC World Gold Council

Conventional and General Terms or Abbreviations

Term Description
AGM Annual general meeting
BSE BSE Limited
CAGR Compounded annual growth rate
CDSL Central Depository Services (India) Limited
CGST Act Central Goods and Services Tax Act, 2017
Cr.P.C Code of Criminal Procedure, 1973
Companies Act, 1956 The erstwhile Companies Act, 1956
Companies Act/Companies Act The Companies Act, 2013 read with rules framed by the Government of
2013 India from time to time
DIN Director identification number
DIPP Department of Industrial Policy and Promotion, Ministry of Commerce and
Industry, Government of India
DPIIT Department for Promotion of Industry and Internal Trade, Ministry of
Commerce and Industry, Government of India earlier known as Department
of Industrial Policy and Promotion, Ministry of Commerce and Industry,
Government of India
DTH Direct to home
DRR Debenture redemption reserve
EGM Extraordinary general meeting
EPS Earnings per share
FDI Policy The Government policy, rules and the regulations (including the applicable
provisions of the FEMA Non-Debt Rules) issued by the Government of
India prevailing on that date in relation to foreign investments in our
Company’s sector of business as amended from time to time

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 Muthoottu Mini Financiers Limited

Term Description
FEMA Foreign Exchange Management Act, 1999
FEMA Non-Debt Regulations Foreign Exchange Management (Non-debt Instruments) Rules, 2019
FEMA Debt Regulations Foreign Exchange Management (Debt Instrument) Regulations, 2019
FPI Foreign Portfolio Investors defined under the Securities and Exchange
Board of India (Foreign Portfolio Investors) Regulations, 2019
Financial Year/FY/Fiscal Financial year ending March 31
GDP Gross domestic product
GoI Government of India
G-Sec Government securities
GST Goods and services tax
HUF Hindu undivided family
IRDAI Insurance Regulatory and Development Authority of India
IFRS International Financial Reporting Standards
IFSC Indian Financial System Code
IGST Act Integrated Goods and Services Tax Act, 2017
IND AS The Indian Accounting Standards referred to in the Companies (Indian
Accounting Standard) Rules, 2015
Indian GAAP Generally Accepted Accounting Principles in India
Insurance Act The Insurance Act, 1938
IT Act The Income Tax Act, 1961
IT Information technology
ISD International subscriber dialling
MCA Ministry of Corporate Affairs, Government of India
MICR Magnetic ink character recognition
MIS Management information system
MoU Memorandum of understanding
NA Not applicable
NACH National Automated Clearing House
NEFT National Electronic Funds Transfer
NII(s) Non-institutional investor(s)
NIM Net interest margin
NRI Non-resident Indian
NSDL National Securities Depository Limited
OCI Overseas Citizenship of India
PAN Permanent account number
RBI Reserve Bank of India
RBI Act Reserve Bank of India Act, 1934
RM Relationship manager
RTGS Real time gross settlement
SCRA Securities Contracts (Regulation) Act, 1956
SCRR The Securities Contracts (Regulation) Rules, 1957
SEBI The Securities and Exchange Board of India constituted under the
Securities and Exchange Board of India Act, 1992
SEBI Act The Securities and Exchange Board of India Act, 1992
SEBI Debt Regulations/ Debt Securities and Exchange Board of India (Issue and Listing of Debt
Regulations/ SEBI Regulations Securities) Regulations, 2008
SEBI Delisting Regulations SEBI (Delisting of Equity Shares) Regulations, 2009
SEBI Listing Regulations/ Listing Securities and Exchange Board of India (Listing Obligations and
Regulations Disclosure Requirements) Regulations, 2015
SGST Act State Goods and Services Tax Act, 2017, as enacted by various state
governments
STD Subscriber trunk dialling
TDS Tax deducted at source
VOIP Voice over internet protocol
WDM Wholesale debt market

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Notwithstanding anything contained herein, capitalised terms that have been defined in the chapters titled “Capital
Structure”, “Statement of Tax Benefits Available to the Debenture Holders”, “History and Certain Other
Corporate Matters”, “Our Management”, “Financial Statements”, “Financial Indebtedness”, “Issue Procedure”,
“Outstanding Litigations”, “Key Regulations and Policies”, “Summary of Main Provisions of the Articles of
Association” and on pages 44, 51, 105, 108, 118, 126, 157, 181, 204 and 217, respectively will have the meanings
ascribed to them in such chapters.

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 Muthoottu Mini Financiers Limited

PRESENTATION OF FINANCIAL, INDUSTRY AND OTHER INFORMATION

Certain Conventions

In this Prospectus, unless the context otherwise indicates or implies, references to “you,” “offeree,” “purchaser,”
“subscriber,” “recipient,” “investors” and “potential investor” are to the prospective Investors to this Issue,
references to “our Company”, the “Company” or the “Issuer” are to Muthoottu Mini Financiers Limited.

Unless otherwise stated, references in this Prospectus to a particular year are to the calendar year ended on
December 31 and to a particular “fiscal” or “fiscal year” are to the fiscal year ended on March 31.

All references to “India” are to the Republic of India and its territories and possessions, and the “Government”,
the “Central Government” or the “State Government” are to the Government of India, central or state, as
applicable.

Financial Data

Our Company publishes its financial statements in Rupees.

Our Company’s Audited Ind AS Financial Statement is prepared in accordance with IND AS, applicable standards
and guidance notes specified by the ICAI, the Companies Act and financial statements for the year ended March
31, 2019, March 31, 2018, March 31, 2017 and March 31, 2016 have been prepared in accordance with Indian
GAAP including the Accounting Standards notified under the Companies Act and other applicable statutory and
/ or regulatory requirements.

The Reformatted Financial Statements of our Company included in this Prospectus are derived from the audited
financial statements prepared in accordance with Indian GAAP for March 31, 2016 to March 31, 2019, which
differs from IND AS in certain respects. The Ministry of Corporate Affairs (“MCA”), in its press release dated
January 18, 2016, issued a roadmap for implementation of IND AS converged with IFRS for non-banking
financial companies, scheduled 50 commercial banks, insurers, and insurance companies, which was subsequently
confirmed by the RBI through its circular dated February 11, 2016. The notification further explains that NBFCs
whose equity and/or debt securities are listed or in the process of listing on any stock exchange in India or outside
India and having a net worth of less than `50,000 lakh, shall comply with IND AS for accounting periods
beginning from April 1, 2019 onwards with comparatives for the periods ending on March 31, 2019 or thereafter.
Accordingly, IND AS is applicable to our Company with effect from April 1, 2019.

The Audited Ind AS Financial Statement of our Company and the Reformatted Financial Statements along with
examination report on the Reformatted Summary Financial Statements are included in this Prospectus, as issued
by our Statutory Auditor, Vishnu Rajendran & Co., in the chapter titled “Financial Statements” on page 118.

Unless stated otherwise, the financial data in this Prospectus is derived from the (i) Audited Ind AS Financial
Statement having been prepared in accordance with the recognition and measurement principles in accordance
with IND AS; and (ii) our Reformatted Financial Statements for the Fiscals ended on March 31, 2019, March 31,
2018, March 31, 2017 and March 31, 2016. The audited financial statements of our Company, prepared in
accordance with Indian GAAP and the Companies Act, 2013 form the basis of such Reformatted Financial
Statement.

In this Prospectus, any discrepancies in any table, including “Capital Structure” and “Objects of the Issue”
between the total and the sum of the amounts listed are due to rounding off. All the decimals have been rounded
off to two decimal places.

Our Audited Ind AS Financial Statement reported under IND AS may not be directly comparable with our
Reformatted Financial Statements, including those disclosed in this Prospectus. We would urge you to consult
your own advisors regarding the differences between Indian GAAP and IND AS and the impact of such
differences on our financial data included in this Prospectus.

There are significant differences between Indian GAAP, IND AS, US GAAP and IFRS. We urge you to consult
your own advisors regarding such differences and their impact on our financial data. Accordingly, the degree to
which the Indian GAAP or IND AS financial statements included in this Prospectus will provide meaningful
information is entirely dependent on the reader’s level of familiarity with Indian GAAP or IND AS, as the case

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maybe. Any reliance by persons not familiar with Indian accounting practices on the financial disclosures
presented in this Prospectus should accordingly be limited.

Currency and units of Presentation

In this Prospectus, all references to ‘Rupees’/’Rs.’/’INR’/’`’ are to Indian Rupees, the legal currency of the
Republic of India.

Except where stated otherwise in this Prospectus, all figures have been expressed in ‘lakhs’. All references to
‘lakhs/lakh’ mean ‘one hundred thousand’ and ‘crore’ means ‘ten million’ and ‘billion/bn./billions’ means ‘one
hundred crores’.

Industry and Market Data

Unless stated otherwise, industry and market data used throughout this Prospectus has been obtained from industry
publications and publicly available information. Industry publications and publicly available information
generally state that the information contained in those publications has been obtained from sources believed to be
reliable but that their accuracy and completeness are not guaranteed, and their reliability cannot be assured.
Accordingly, no investment decision should be made on the basis of such information. Although our Company
believes that industry data used in this Prospectus is reliable, it has not been independently verified. Also, data
from these sources may not be comparable. Similarly, internal reports, while believed by us to be reliable, have
not been verified by any independent sources. The extent to which the market and industry data used in this
Prospectus is meaningful depends on the reader’s familiarity with and understanding of the methodologies used
in compiling such data. Certain information and statistics in relation to the industry in which we operate, which
has been included in this Prospectus has been extracted from an industry report titled “Gold Loan Industry in
India”, dated August 9, 2020 prepared and issued by IRR Advisory Services Private Limited (“IRR Report”).
Please refer to “Industry Overview” on page 64 for further details. Following is the disclaimer of IRR Advisory
Services Private Limited in relation to the IRR Report:

“This report is prepared by IRR Advisory Services Pvt Ltd (IRR Advisory). IRR Advisory has taken utmost care to
ensure accuracy and objectivity while developing this report. IRR Advisory is not responsible for any errors or
omissions in analysis/inferences/views or for results obtained from the use of information contained in this report
and especially states that IRR advisory has no financial liability whatsoever to the user of this report. This report
is for the information of the intended recipients only and no part of this report may be published or reproduced
in any form or manner without prior written permission of IRR Advisory.”

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 Muthoottu Mini Financiers Limited

FORWARD LOOKING STATEMENTS

This Prospectus contains certain statements that are not statements of historical fact and are in the nature of
“forward-looking statements”. These forward-looking statements generally can be identified by words or phrases
such as “aim”, “anticipate”, “believe”, “continue”, “expect”, “estimate”, “intend”, “objective”, “plan”,
“potential”, “project”, “will”, “will continue”, “will pursue”, “will likely result”, “will seek to”, “seek” or other
words or phrases of similar import. All statements regarding our expected financial condition and results of
operations and business plans and prospects are forward-looking statements. These forward-looking statements
include statements as to our business strategy, revenue and profitability and other matters discussed in this
Prospectus that are not historical facts.

All forward-looking statements are subject to risks, uncertainties and assumptions about us that could cause actual
results, performance or achievements to differ materially from those contemplated by the relevant statement.

Actual results may differ materially from those suggested by the forward looking statements due to risks or
uncertainties associated with our expectations with respect to, but not limited to, regulatory changes pertaining to
our businesses and our ability to respond to them, our ability to successfully implement our strategies, our growth
and expansion, technological changes, our exposure to market risks, general economic and political conditions in
India and which have an impact on our business activities or investments, the monetary and fiscal policies of
India, inflation, deflation, unanticipated turbulence in interest rates, equity prices or other rates or prices, the
performance of the financial markets in India and globally, changes in domestic laws, regulations and taxes and
changes in competition in our industry.

Important factors that could cause actual results to differ materially from our expectations include, but not limited
to, the following:

1. Any increase in the levels of non-performing assets (“NPA”) on our loan portfolio, for any reason
whatsoever, would adversely affect our business and results of operations;

2. Any volatility in interest rates which could cause our Gross Spreads to decline and consequently affect
our profitability;

3. Changes in the value of Rupee and other currency changes;

4. Unanticipated turbulence in interest rates or other rates or prices; the performance of the financial and
capital markets in India and globally;

5. Changes in political conditions in India;

6. The rate of growth of our Loan Assets;

7. The outcome of any legal or regulatory proceedings we are or may become a party to;

8. Changes in Indian and/or foreign laws and regulations, including tax, accounting, banking, securities,
insurance and other regulations; changes in competition and the pricing environment in India; and
regional or general changes in asset valuations;

9. Any changes in connection with policies, statutory provisions, regulations and/or RBI directions in
connection with NBFCs, including laws that impact our lending rates and our ability to enforce our
collateral;

10. Emergence of new competitors;

11. Performance of the Indian debt and equity markets;

12. Occurrence of natural calamities, pandemics, or natural disasters affecting the areas in which our
Company has operations;

13. The performance of the financial markets in India and globally;

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 Muthoottu Mini Financiers Limited

14. Volatility in global bullion prices; and

15. Other factors discussed in this Prospectus, including under the chapter titled “Risk Factors” on page 16.

For further discussion of factors that could cause our actual results to differ from our expectations, please refer to
the chapters “Risk Factors”, “Industry Overview” and “Our Business” on pages 16, 64 and 87, respectively.

By their nature, certain market risk disclosures are only estimate and could be materially different from what
actually occurs in the future. As a result, actual future gains or losses could materially differ from those that have
been estimated. Forward looking statements speak only as on the date of this Prospectus. The forward-looking
statements contained in this Prospectus are based on the beliefs of management, as well as the assumptions made
by and information currently available to management. Although we believe that the expectations reflected in
such forward-looking statements are reasonable at this time, it cannot assure Investors that such expectations will
prove to be correct or will hold good at all times. Given these uncertainties, Investors are cautioned not to place
undue reliance on such forward-looking statements. If any of these risks and uncertainties materialise, or if any of
our underlying assumptions prove to be incorrect, our actual results of operations or financial condition could
differ materially from that described herein as anticipated, believed, estimated or expected. All subsequent
forward-looking statements attributable to us are expressly qualified in their entirety by reference to these
cautionary statements. Neither our Company nor the Lead Manager, nor any of its affiliates have any obligation
to, and do not intend to, update or otherwise revise any statements reflecting circumstances arising after the date
hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come to fruition.
Our Company and the Lead Manager will ensure that Investors in India are informed of material developments
until the time of the grant of listing and trading permission by the Stock Exchange.

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 Muthoottu Mini Financiers Limited

SECTION II - RISK FACTORS

An investment in NCDs involves a certain degree of risk. You should carefully consider all the information
contained in this Prospectus, including the risks and uncertainties described below, and the information provided
in the sections titled “Our Business” on page 87 and “Financial Statements” on page 118 before making an
investment decision. The risk factors set forth below do not purport to be complete or comprehensive in terms of
all the risk factors that may arise in connection with our business or any decision to purchase, own or dispose of
the NCDs. The following risk factors are determined on the basis of their materiality. In determining the
materiality of risk factors, we have considered risks which may not be material individually but may be material
when considered collectively, which may have a qualitative impact though not quantitative, which may not be
material at present but may have a material impact in the future. Additional risks, which are currently unknown
or now deemed immaterial, if materialises, may in the future have a material adverse effect on our business,
financial condition and results of operations. The market prices of the NCDs could decline due to such risks and
you may lose all or part of your investment including interest thereon.

Unless specified or quantified in the relevant risk factors below, we are not in a position to quantify the financial
or other implication of any of the risks described in this section. This Prospectus also contains forward-looking
statements that involve risks and uncertainties. Our results could differ materially from those anticipated in these
forward-looking statements as a result of certain factors, including events described below and elsewhere in this
Prospectus. Unless otherwise stated, the financial information used in this section is derived from and should be
read in conjunction with the Audited Ind AS Financial Statement and the Reformatted Financial Statements.

Internal Risk Factors

1. The impact of the COVID-19 pandemic on our business and operations is uncertain and cannot be
predicted.

In late 2019, the COVID-19 disease, commonly known as “novel coronavirus”, was first reported in Wuhan,
China. On January 30, 2020, the World Health Organization declared the COVID-19 outbreak a “Public
Health Emergency of International Concern” and on March 11, 2020 it was declared a pandemic. Between
January 30, 2020 and the date of this Prospectus, the COVID-19 disease has spread to many other countries,
with the number of reported cases and related deaths increasing daily and, in many countries, exponentially.

Several countries’ governments and numerous companies have imposed increasingly stringent restrictions to
help avoid, or slow down, the spreading of COVID-19, including, for example, restrictions on international
and local travel, public gatherings and participation in meetings, as well as closures of non-essential services,
universities, schools, stores, restaurants and other key service providers, with some countries imposing strict
curfews. In India, the Government of India initially announced a 21-day country-wide lockdown starting on
March 25, 2020, which was further extended, with certain modifications, till May 31, 2020, and there can be
no assurance that this lockdown will not be extended further on one or more occasions. However, the
lockdown restrictions in India have been relaxed. These measures have led to a significant decline in
economic activities.

We continue to monitor developments closely as the COVID-19 pandemic develops. The impact of the
COVID-19 pandemic on our business will depend on a range of factors which we are not able to accurately
predict, including the duration, severity and scope of the pandemic, the geographies impacted, the impact of
the pandemic on economic activity in India, and the nature and severity of measures adopted by governments.
These factors include, but are not limited to: (i) pursuant to RBI's directions, we have granted moratorium on
payment of all instalments falling due between March 1, 2020 and August 31, 2020 (the "Moratorium
Period") in respect of gold loans; (ii) Significant volatility in financial markets (including exchange rate
volatility) and measures adopted by governments and central banks that further restrict liquidity, which may
limit our access to funds, lead to shortages of cash or increase the cost of raising such funds; (iii) the
Company’s stress testing, changes in loan disbursement, and other measures to address the effects of the
COVID-19 pandemic may fail (iv) in the event a member or members of our management team contracts
COVID-19, it may potentially affect our business operations; and (v) the Company’s branch level and other
operations will be disrupted by social distancing, split-team, work from home and quarantine measures. As
these are unforeseen circumstances, it may give rise to risks that we may not have anticipated. If the outbreak
of any of these epidemics or other severe epidemics, continues for an extended period, occur again and/or
increases in severity, it could have an adverse effect on economic activity worldwide, including India, and
could materially and adversely affect our business, cash flows, financial condition and results of operations.

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 Muthoottu Mini Financiers Limited

Similarly, any other future public health epidemics or outbreak of avian or swine influenza or other contagious
disease in India could also materially and adversely affect our business, cash flows, results of operations and
financial condition.

As on June 30, 2020, a majority of our Company operations is concentrated in southern India - Kerala (11%
of total operations), Tamil Nadu (41%), Karnataka (21%) and Andhra Pradesh (23%). With the COVID-19
contagion having moved towards the rural areas, local lockdowns are impacting the operations in these
regions largely in terms of cash collection and sanctioning of new gold loans, as customers walk-ins have
moderated However, gold loan has relatively been performing well due to lower loss given default risk. The
gold prices are also on the surge during these pandemic times.

2. We are subject to an inspection by the RBI and any adverse action taken could affect our business and
operations.

Our Company was subjected to RBI’s inspection under Section 45N of the RBI Act, for the financial position
as on March 31, 2019. Subsequently, RBI vide a letter dated February 19, 2020 (“Letter”), observed certain
supervisory concerns, which inter alia included matters with regard to (a) adherence to applicable guidelines
by our Company during the auctioning process of gold; (b) adherence to KYC guidelines; (c) issues pertaining
to the fair practice code; (d) ensuring compliance with corporate governance requirements; (e) inadequacy of
our Company’s MIS and lack of system generated data for inspection; (f) disclosure of related party
transactions in the Audit Committee; (g) not complying with the reporting all the frauds below 1 lakh to the
Board/Audit Committee; Due to the dislocations caused in our office on account of the COVID-19 situation,
there was a delay in submitting our response to the Letter within the stipulated time. Our Company
subsequently filed a letter with the RBI on May 22, 2020, replying to the observations made in the Letter
(“Response”). Thereafter, RBI through their email dated June 11, 2020 (“Email”) issued a letter for further
compliances to the Response submitted by our Company in relation to the Letter. Our Company subsequently
responded to the further compliances to the Response submitted by our Company in relation to the Letter
through our letter dated August 19, 2020 which was sent to RBI through an email on August 19, 2020.

In the event we are unable to resolve such deficiencies to the satisfaction of the RBI, we may be restricted in
our ability to conduct our business as we currently do. While we seek to comply with all regulatory provisions
applicable to us, in the event we are unable to comply with the observations made by the regulatory
authorities, we could be subject to penalties and restrictions which may have an adverse effect on our business,
results of operations, financial condition and reputation.

3. We are in receipt of a show cause notice issued by the RBI. Any adverse action taken against our Company
or penalty imposed on our Company by the RBI could adversely affect our business and operations.

Our Company was subjected to RBI’s inspection under Section 45N of the RBI Act, from November 7, 2016
to November 18, 2016. Subsequently RBI issued a show cause notice to our Company dated September 28,
2017, bearing reference number DNBS (T) No. 235/02.19.007/2017-18 under Section 58-G of the RBI Act
(“SCN”), wherein the RBI observed certain instances of non-compliances by our Company and directed our
Company to submit a reply within a period of fifteen days from the receipt of the SCN, showing cause as to
why a penalty should not be imposed on our Company. These instances included (i) our Company not
reporting all the frauds of `1 lakh and above to the Board/Audit Committee; (ii) loans above `1 lakh having
been disbursed through cash including instances wherein loans above `1 lakh were split into multiple loans;
(iii) auctioning of pledged gold below the prescribed minimum reserve price; (iv) failure to inform customers
about the value fetched in the auction process and adjustments made against outstanding dues; and (v) failure
to comply with RBI’s instruction in relation to obtaining prior approval of RBI for expansion of branches
exceeding 1,000 branches. The SCN also referred to a supervisory letter dated February 15, 2017, response
from our Company on which was found to be unsatisfactory to the RBI. Our Company vide its letter dated
October 12, 2017 (“Reply”), addressed the concerns raised by RBI vide the SCN and provided a detailed
reply to the RBI. Thereafter, RBI issued a letter dated April 16, 2018 in relation to the SCN and the Reply
advising our Company to strictly follow, inter alia, the instructions pertaining to the conduct of the auction
process and issue of post auction intimation letters. Any action against our Company or penalty imposed on
our Company could have a material adverse impact on our Company’s business and reputation.

4. We are subject to certain legal proceedings and any adverse decision in such proceedings may have a
material adverse effect on our business and results of operations.

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We are subject to certain legal proceedings including civil suits, statutory and regulatory proceedings,
recovery proceedings etc. We incur cost in defending these proceedings before a court of law. Moreover, we
are unable to assure you that we shall be successful in any or all of these actions. In the event we suffer any
adverse order, our reputation may suffer and may have an adverse impact on our business and results of
operations. Further, our Company has initiated certain criminal proceeding against few of our employees and
third parties in relation to our business operations. Any adverse decision in such proceedings may have a
material adverse effect on our business and results of operations. For, further details of the legal proceedings
that we are subject to, please refer to the chapter titled “Outstanding Litigations” on page 181.
5. We do not own the trademark we have been authorised to use it by one of our Group
Companies. Termination or withdrawal on unfavourable terms of this authorisation to use or any negative
impact on the ‘Muthoottu Mini’ brand may adversely affect our business, reputation, goodwill, financial
condition and results of operations.

The trademark is registered with the Registrar of Trademarks in India in the name of one of our
Group Companies, Mini Muthoottu Nidhi (Kerala) Limited with validity till April 30, 2029. We had been
authorised to use this trademark on a non-exclusive, non-assignable basis by way of letter dated May 2, 2009
which was revalidated by a letter dated July 30, 2020 (“Letter”). We cannot assure you that we will continue
to have uninterrupted use of this trademark if we are unable to conform to the requirements under the Letter.
Further, termination or withdrawal of the permission may adversely affect our business, reputation, goodwill,
financial condition and results of operations. Further, some of the intellectual property are subject to
litigations. For further details of the legal proceedings that we are subject to, please refer to the chapter titled
“Outstanding Litigations” on page 181.

Further, some of the other companies, wherein our Promoters are interested, also use this trademark. If any
of the actions of our Promoters or companies in which they hold any interest negatively affect our brand, our
reputation, business and financial condition may in turn be adversely affected. Additionally, the logo of our
Company, as appearing on the cover page of this Prospectus, has not been registered and we cannot assure
you that misuse of the same by any third party shall not be detrimental to our business.

6. Our business is capital intensive and any disruption or restrictions in raising financial resources would
have a material adverse effect on our liquidity and financial condition.

Our liquidity and ongoing profitability are largely dependent upon our timely access to and the costs
associated in, raising financial resources at low costs. Our funding requirements historically have been met
from a combination of borrowings such as term loans, working capital limits from banks / financial
institutions, issuance of secured and unsecured redeemable non-convertible debentures and subordinated
debts. Thus, our business depends and will continue to depend on our ability to access diversified low-cost
funding sources.

Our ability to raise funds on acceptable terms and at competitive rates depend on various factors like credit
ratings, the regulatory environment and policy initiatives in India, developments in the international markets
affecting the Indian economy, investors’ and/or lenders’ perception of demand for debt and equity securities
of NBFCs, and our current and future results of operations and financial condition.

In case of a global financial crisis, the capital and lending markets typically become highly volatile and access
to liquidity becomes significantly reduced. In addition, it may become more difficult to renew loans and
facilities as many potential lenders and counterparties could also face liquidity and capital concerns, as a
result of the stress in the financial markets. If any event of a similar nature and magnitude occurs again in the
future, such as the recent liquidity crisis caused on account of debt default by one of the large Indian NBFCs,
it may result in increased borrowing costs and difficulty in accessing debt in a cost-effective manner.
Moreover, we are a NBFC-ND-SI, and do not have access to public deposits.

The RBI guideline bearing reference no. [Link]. 106/21.04.172/2011-12 dated May 18, 2012
whereby it has instructed banks to (i) reduce their regulatory exposure on a single NBFC having gold loans
to the extent of 50.00% or more of its financial assets from 10.00% to 7.50% of their capital funds; and (ii)
have an internal sub-limit as decided by the boards of the respective banks on their aggregate exposure to all
such NBFCs having gold loans to the extent of 50% or more of their financial assets, taken together, which
sub-limit should be within the internal limits fixed by banks for their aggregate exposure to all NBFCs taken
together.

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The RBI vide the Master Directions issued certain guidelines with respect to raising money through private
placement by NBFCs in the form of non-convertible debentures. These guidelines include (i) restrictions on
the minimum subscription amount for a single investor at `20,000; (ii) the issuance of private placement of
non-convertible debentures shall be in two separate categories, those with a maximum subscription of less
than `1 crore and those with a minimum subscription of `1 crore per investor; (iii) the restriction of number
of investors in an issue to 200 investors for every financial year for a maximum subscription of less than `1
crore which shall be fully secured; (iv) there is no limit on the number of subscribers in respect of issuances
with a minimum subscription of `1 crore and above while the option to create security in favour of subscribers
will be with the issuers and such unsecured debentures shall not be treated as public deposits; (v) restriction
on NBFCs for issuing debentures only for deployment of funds on its own balance sheet and not to facilitate
resource requests of group entities/parent company/associates; and (vi) prohibition on providing loan against
its own debentures. This has resulted in limiting our Company’s ability to raise fresh debentures on private
placement basis.

A significant portion of our debt matures each year. Out of the total amount of our outstanding non-
convertible debentures (excluding interest thereon), ` 63,154.80 lakhs, issued by our Company as of June 30,
2020, non-convertible debentures amounting to ` 19,665.23 lakhs will mature during the next 12 months. In
order to retire these instruments, we either will need to refinance this debt, which could be difficult in the
event of volatility in the credit markets or raise equity capital or generate sufficient cash to retire the debt.

Changes in economic and financial conditions or continuing lack of liquidity in the market could make it
difficult for us to access funds at competitive rates. As an NBFC, we also face certain restrictions on our
ability to raise money from international markets, which may further constrain our ability to raise funds at
attractive rates.

Any disruption in our primary funding sources at competitive costs could have a material adverse effect on
our liquidity and financial condition.

7. Our financial performance is primarily dependent on interest rate risk. If we are unable to manage interest
rate risk in the future it could have an adverse effect on our net interest margin, thereby adversely affecting
business and financial condition of our Company.

Our results of operations are substantially dependent upon the level of our net interest margins. Income from
operations is the largest component of our total income, and constituted 98.62%, 98.78% and 98.38% of our
total income for Fiscal 2020, Fiscals 2019 and 2018, respectively. Interest rates are sensitive to many factors
beyond our control, including the RBI’s monetary policies, domestic and international economic and political
conditions and other factors.

Over the years, the Government of India has substantially deregulated the financial sector. As a result, interest
rates are now primarily determined by the market, which has increased the interest rate risk exposure of all
banks and financial intermediaries in India, including us.

Our policy is to attempt to balance the proportion of the interest earning assets (which bear fixed interest
rates), with interest bearing liabilities. A significant portion of our liabilities, such as our non-convertible
debentures carry fixed rates of interest and the remaining are linked to the respective banks’ benchmark prime
lending rate/base rate. As of June 30, 2020, 72.62% of our borrowings were at fixed rates of interest.
Moreover, we do not hedge our exposure to interest rate changes. We cannot assure you that we can
adequately manage our interest rate risk in the future or can effectively balance the proportion of our fixed
rate loan assets and liabilities. Further, changes in interest rates could affect the interest rates charged on
interest earning assets and the interest rates paid on interest bearing liabilities in different ways. Thus, our
results of operations could be affected by changes in interest rates and the timing of any re pricing of our
liabilities compared with the re pricing of our assets.

Any mismatch between the yield on an assets and the cost of our funds due to market action/factors could
have an impact on our profitability.

8. We face increasing competition in our business which may result in declining interest margins. If we are
unable to compete successfully, our market share may also decline.

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Our principal business is providing gold loan to customers in India secured by gold jewellery. Historically,
the gold loan industry in India has been largely unorganised and dominated by local jewellery pawn shops
and money lenders, with little involvement from public sector or private sector banks. Gold loan financing
was availed predominantly by lower income group customers with limited or no access to other forms of
credit, however, such income group has gained increased access to capital through organised and unorganised
money lenders, which has increased our exposure to competition. The demand for gold loans has also
increased due to relatively lower and affordable interest rates, increased need for urgent borrowing or bridge
financing requirements, the need for liquidity for assets held in gold and increased awareness and acceptance
of gold loan financing.

There is increased competition from other lenders in the gold loan industry, including commercial banks and
other NBFCs, who also have access to funding from customers’ in the form of savings and current deposits.
We rely on higher cost loans and debentures for our funding requirements, which could reduce our margins.
Our ability to compete effectively will depend, on our ability to raise low cost funding. If we are unable to
compete effectively with other participants in the gold loan industry, our business, financial condition and
results of operations may be adversely affected.

The competition in the gold loan industry has increased in gold loans are becoming increasingly standardised.
Variable interest rates, variable payment terms and waiver of processing fees are also becoming increasingly
common.

In our microfinance business, we face competition from other NBFCs, microfinance companies as well as both
commercial and small finance banks. In addition, the RBI has set out guidelines applicable to microfinance
institutions which restrict the number of microfinance institutions that can extend loans to the same borrower
and also limit the maximum amount of loan that can be extended. The presence of microfinance institutions in
India is not uniform and certain regions have a concentration of a large number of microfinance institutions
while there are regions which have very few and even no microfinance institution presence. In any particular
region, the level of competition depends on the number of microfinance institutions that operate in such area.
In addition, our target customers also borrow from money lenders and non-institutional lenders which may
lend at higher rates of interest.

Our ability to compete effectively will depend, to an extent, on our ability to raise low-cost funding in the
future as well as our ability to maintain or decrease our operating expenses by increasing operational
efficiencies and managing credit costs. As a result of increased competition in the various sectors we operate
in, products in our industry have become increasingly standardised and variable interest rate and payment terms
and lower processing fees are becoming increasingly common across our products. There can be no assurance
that we will be able to effectively address these or other finance industry trends or compete effectively with
new and existing commercial banks, NBFCs, payment banks, other small finance banks and other financial
intermediaries that operate across our various financing products.

In addition, the government has issued schemes such as Pradhan Mantri Jan-Dhan Yojana to ensure access to
financial services in an affordable manner. Further, public sector banks as well as existing private sector banks,
have an extensive customer and depositor base, larger branch networks, and in case of public sector banks,
Government support for capital augmentation, due to which they may enjoy corresponding economies of scale
and greater access to low-cost capital, and accordingly, we may not be able to compete with them. An inability
to effectively address such competition may adversely affect our market share, business prospects, results of
operations and financial condition.

9. We may not be able to realise the full value of our pledged gold jewellery in case of a default, which exposes
us to a potential loss.

We may not be able to realise the full value of our pledged gold, due to, among other things, defects in the
quality of gold or wastage that may occur when melting gold jewellery into gold bars. We have in place an
extensive internal policy on determining the quality of gold prior to disbursement of the gold loan. However,
we cannot assure that methods followed by us are fool proof and the impurity levels in the gold can be
accurately assessed.

In the case of a default, amongst others we may auction the pledged gold in accordance with our auction policy.
We cannot assure you that we will be able to auction such pledged gold jewellery at prices sufficient to cover
the amounts under default. Moreover, there may be delays associated with the auction process or other

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processes undertaken by us to recover the amount due to us. Any such failure to recover the expected value of
pledged gold could expose us to a potential loss and which could adversely affect our financial condition and
results of operations.

10. Volatility in the market price of gold may adversely affect our financial condition, cash flows and results
of operations.

We extend loans secured mostly by gold jewellery. A sustained decrease in the market price of gold could
cause a corresponding decrease in new Gold Loans in our loan portfolio and, as a result, our interest income.
In addition, customers may not repay their loans and the gold jewellery securing the loans may have decreased
significantly in value, resulting in losses which we may not be able to support. The impact on our financial
position and results of operations of a hypothetical decrease in gold values cannot be reasonably estimated
because the market and competitive response to changes in gold values is not pre-determinable.

11. Our ability to lend against the collateral of gold jewellery has been restricted on account of guidelines
issued by RBI, which may have a negative impact on our business and results of operation.

RBI vide the Master Directions has stipulated all NBFCs to maintain an LTV ratio not exceeding 75% for
loans granted against the collateral of gold jewellery and further prohibits lending against bullion/primary
gold and gold coins. This notification will limit our ability to provide loan on the collateral of gold jewellery
and thereby putting us at a disadvantage vis-à-vis unregulated money lenders offering similar products.
Further, RBI in the Master Directions, has mandated NBFCs primarily engaged in lending against gold
jewellery (such loans comprising 50% or more of their financial assets) to maintain a minimum Tier I Capital
of 12%. Such restrictions imposed by RBI may erode our margins, impact our growth and business prospects.

RBI in the Master Directions further tightened the norms for lending against the security of gold ornaments
by pegging the maximum lendable value to preceding 30 day’s average of the closing price of 22 carat gold
as per the rate as quoted by the Bombay Bullion Association. Any such future restrictions by RBI could have
a negative impact on our business and results of operation.

12. We may not be able to successfully sustain our growth strategy. Inability to effectively manage our growth
and related issues could materially and adversely affect our business and impact our future financial
performance.

Our growth strategy includes growing our AUM, expanding network of branches and expanding the range of
products and services. We cannot assure you that we will be able to execute our growth strategy successfully
or continue to achieve or grow at the levels of revenue earned in recent years, or that we will be able to expand
further our AUM. Furthermore, there may not be sufficient demand for our services, or they may not generate
sufficient revenues relative to the costs associated with offering such services. Even if we were able to
introduce new services successfully, there can be no assurance that we will be able to achieve our intended
return on such investments. If we grow our AUM too rapidly or fail to make proper assessments of credit
risks associated with borrowers, a higher percentage of our loans may become non-performing, which would
have a negative impact on the quality of our assets and our financial condition.

Further principal component of our strategy is to continue to grow by expanding the size and geographical
scope of our businesses. This growth strategy will place significant demands on our management, financial
and other resources. It will require us to continuously develop and improve our operational, financial and
internal controls. It also includes undertaking permission from various authorities, including RBI and various
regulatory compliances. Continuous expansion increases the challenges involved in financial management,
recruitment, training and retaining high quality human resources, preserving our culture, values and
entrepreneurial environment, and developing and improving our internal administrative infrastructure.

13. If we are not able to control the level of non-performing assets in our portfolio, the overall quality of our
loan portfolio may deteriorate, and our results of operations may be adversely affected.

We may not be successful in our efforts to improve collections and/or enforce the security interest on the gold
collateral on existing as well as future non-performing assets. Moreover, as our loan portfolio increases, we
may experience greater defaults in principal and/or interest repayments. Thus, if we are not able to control
our level of non-performing assets, the overall quality of our loan portfolio may deteriorate, and our results

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of operations may be adversely affected. Our gross NPAs as of Fiscals ended March 31, 2020, March 31,
2019 and March 31, 2018, was `3,190.14 lakhs, `2,987.43 lakhs and `3,254.83 lakhs, respectively.

The Master Directions prescribe the provisioning required in respect of our outstanding loan portfolio. Should
the overall credit quality of our loan portfolio deteriorate, the current level of our provisions may not be
adequate to cover further increases in the amount of our non-performing assets. Furthermore, although we
believe that our total provision will be adequate to cover all known losses in our asset portfolio, our current
provisions may not be adequate when compared to the loan portfolios of other financial institutions.
Moreover, there also can be no assurance that there will be no further deterioration in our provisioning
coverage as a percentage of gross non-performing assets or otherwise, or that the percentage of non-
performing assets that we will be able to recover will be similar to our past experience of recoveries of non-
performing assets. In the event of any further increase in our non-performing asset portfolio, there could be
an even greater, adverse impact on our results of operations.

14. Our indebtedness and the conditions and restrictions imposed by our financing agreements could restrict
our ability to conduct our business and operations in the manner we desire.

As of June 30, 2020, we had an outstanding debt (including interest on bank borrowings and excluding interest
on debentures) of ` 1,21,642.28 lakhs. We may incur additional indebtedness in the future. Many of our
financing agreements include various restrictive conditions and covenants restricting certain corporate
actions, and our Company is required to take the prior approval of the lender before carrying out such
activities. For instance, our Company, inter alia, is required to obtain the prior written consent in the
following instances:

• to declare and/or pay dividend to any of its shareholders whether equity or preference, during any
financial year unless our Company has paid to the lender the dues payable by our Company in that year;
• to undertake or permit any merger, amalgamation or compromise with its shareholders, creditors or effect
any scheme of amalgamation or reconstruction or disposal of whole of the undertaking;
• to create or permit any charges or lien, sell or dispose of any encumbered assets;
• to alter its capital structure, or otherwise acquire any share capital;
• to effect a change of ownership or control, or management of our Company;
• to enter into long term contractual obligations directly affecting the financial position of our Company;
• to borrow or obtain credit facilities from any bank or financial institution;
• to undertake any guarantee obligations on behalf of any other company;
• to make any share capital investments or advance loans or funds to any other concern including group
companies;
• to repay dues of promoter/group companies;
• to undertake any new project/further expansion or acquire fixed assets except those indicated in the funds
flow statement submitted to the bank from time to time and approved by the bank;
• to sell, assign, mortgage or otherwise dispose of any of the fixed assets charged to the banks; and
• any change of practice with regard to remuneration of the directors.

Our indebtedness could have several important consequences, including our cash flows being used towards
repayment of our existing debt, which will reduce the availability of our cash flow to fund our working capital,
capital expenditures and other general corporate requirements. Moreover, our ability to obtain additional
financing or renewal of existing facilities, in the future at reasonable terms may be restricted or our cost of
borrowings may increase due to sudden adverse market conditions, including decreased availability of credit
or fluctuations in interest rates, particularly because a significant proportion of our financing arrangement are
in the form of borrowings from banks. There could be a material adverse effect on our business, financial
condition and results of operations if we are unable to service our indebtedness or otherwise comply with
financial and other covenants specified in the financing agreements and we may be more vulnerable to
economic downturns, which may limit our ability to withstand competitive pressures and may reduce our
flexibility in responding to changing business, regulatory and economic conditions.

15. A major part of our branch network is concentrated in southern India and any disruption or downturn in
the economy of the region would adversely affect our operations.

As of June 30, 2020, 98.47% of our branches i.e. 773 branches were located in the southern states of Andhra
Pradesh, Telangana, Goa, Karnataka, Kerala and Tamil Nadu and the union territory of Puducherry and these

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constituted about 96.46% of our total gold loan portfolio as of June 30, 2020. For details please refer to “Our
Business” on page 87. As a result, we are exposed to risks including any change in policies relating to these
states, any localised social unrest, any natural disaster and any event or development which could make
business in such states less economically beneficial. Further, any disruption, disturbance or breakdown in
these states could adversely affect the result of our business and operations. Our concentration in these
southern states of India exposes us to adverse economic or political circumstances that may arise in that region
as compared to other NBFCs and commercial banks that may have diversified national presence and may
have an adverse effect on our business, market share and results of operations.

16. Our bank funding is concentrated amongst a few lenders and impairment of our relationship with any, or
all, of such lenders or our inability to secure additional loans and renewal of existing facilities on
favourable terms from such lenders in the future, may have a material adverse effect on our business,
results of operations and financial condition.

As on June 30, 2020, we have been sanctioned working capital limits of `7,500 lakhs from Union Bank of
India (erstwhile Andhra Bank), `5,000 lakhs from IndusInd Bank, `2,900 lakhs from Dhanalaxmi Bank
Limited, `5,000 lakhs from Punjab National Bank (erstwhile Oriental Bank of Commerce), `16,500 lakhs
from The South Indian Bank Limited, `5,000 lakhs from State Bank of India, `2,500 lakhs from Union Bank
of India and `100 lakhs from HDFC Bank Limited. We may have difficulty in obtaining funding on
acceptable terms from these or other lenders and other sources which we have not accessed so far. Any
impairment of our relationship with any, or all, of our lenders or our inability to secure additional loans and
renewal of existing facilities on favourable terms from such lenders in future may have a material adverse
effect on our business, results of operations and financial condition.

17. Our Company has in the past deviated from the accrual accounting policy.

Our Company has not recognised the interest accrued but not due on the non-convertible debentures issued
by our Company, in accordance with the accrual method of accounting for the Fiscal 2012 till Fiscal 2016.
However, in the Fiscal 2017, our Company provided for the entire amount of accrued interest but not due
liability on such issued non-convertible debentures, amounting to `15,463.21 lakhs. For further details, see
“Financial Statements” on page 118.

18. Our gold loans are of tenors not exceeding 1 year, and a failure to disburse new loans may result in a
reduction of AUM and a corresponding interest income would decline.

The gold loans we offer are short term loans and are due within one year of disbursement typically ranging
from three to nine months. The relatively short term nature of our loans means that we are not assured of long
term interest income streams compared to businesses that offer loans with longer terms. In addition, our
existing customers may not obtain new loans from us upon maturity of their existing loans, particularly if
competition increases. The short term nature of our loan products and the potential instability of our interest
income could materially and adversely affect our results of operations and financial position.

19. Inaccurate appraisal of gold by our personnel may adversely affect our business and financial condition.

Accurate appraisal of pledged gold is a significant factor in the successful operation of our business and such
appraisal requires a skilled and reliable workforce. Assessing gold jewellery quickly is a specialised skill that
requires assessing jewellery for gold content and quality manually without damaging the jewellery. Our
Company provides training for our personnel for assessing jewellery for gold content and quality. However,
in spite of rigorous training there is no guarantee that the gold ornaments appraised are accurately. Inaccurate
appraisal of gold content, by our workforce may result in the gold ornament being overvalued and pledged
for a loan that is higher in value than the actual value of gold content, which could adversely affect our
reputation and business. We also run the risk of spurious gold being incorrectly assessed and approved for
disbursement. Further, we are subject to the risk of inaccurate or fraudulent estimation of the value of pledged
gold by our gold appraisers. Any such inaccuracies or fraud in relation to our appraisal of gold may adversely
affect our reputation, business and financial condition.

20. We depend on customer supplied information when evaluating customer credit worthiness.

In deciding whether to extend credit or enter into other transactions with customers and counter parties, we
may rely on information furnished to us by or on behalf of our customers, including the financial information

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from which we create our credit assessments. We may also rely on customer representations as to the accuracy
and completeness of customer supplied information. Any relevant changes in this information may not be
made available to us. The information that we have gathered may not be sufficient to create a complete
customer risk profile. Because we rely on such customer supplied information, some or all of certain
customers’ risk profiles may be wilfully or inadvertently wrong or misleading, which may lead us to enter
into transactions that may adversely affect our financial condition and results of operations.

21. The implementation of our KYC norms as well as our measures to prevent money laundering may not be
completely effective, which could adversely affect our reputation and in turn have an adverse impact on
our business and results of operations.

Our implementation of anti-money laundering measures required by the RBI, including KYC policies and the
adoption of anti-money laundering and compliance procedures in all our branches, may not be completely
effective. There can be no assurance that certain of our customers will not indulge in money laundering
activities advertently misusing our business channels. If we were identified to be associated with money
laundering operations, our reputation may be adversely affected, which in turn could have an adverse impact
on our business and results of operations.

22. Our customer base comprises entirely of individual borrowers, who generally are more likely to be affected
by declining economic conditions than large corporate borrowers. Any decline in the repayment
capabilities of our borrowers, may result in increase in defaults, thereby adversely affecting our business
and financial condition.

Individual borrowers typically are less financially resilient than larger corporate borrowers, and as a result,
they are typically more adversely affected by declining economic conditions. In addition, a significant
majority of our customer base belongs to the low to medium income group. Furthermore, unlike many
developed economies, a nationwide credit bureau has only recently become operational in India, so there is
less financial information available about individuals, particularly our focus customer segment of the low to
medium income group. It is therefore difficult to carry out precise credit risk analyses on our customers.
While we follow certain procedures to evaluate the credit profile of our customers before we sanction a loan,
we generally rely on the quality of the pledged gold rather than on a stringent analysis of the credit profile of
our customers. Although we believe that our risk management controls are sufficient, we cannot be certain
that they will continue to be sufficient or that additional risk management policies for individual borrowers
will not be required. Failure to maintain sufficient credit assessment policies, particularly for individual
borrowers, could adversely affect our loan portfolio, which could in turn have an adverse effect on our
financial condition and results of operations.

23. Our Company and certain of our Promoters, Directors, Key Managerial Personnel, Group Companies
were subject to a search conducted by income tax authorities. Any adverse action in this regard could have
a detrimental impact on our Company’s reputation and business operations.

In August 2016, income tax authorities conducted searches at certain branches, Registered Office of our
Company, the residence of certain of our Promoters, Directors, Key Managerial Personnel and business
consultant along with the offices of certain of our Group Companies. These searches were conducted in
relation to proceeds from the gold auctions conducted by our Company. During the search, certain cash were
seized by the income tax authorities and certain lockers were sealed. While, our Company has not received
any subsequent notice or been subject to any follow-up action by the authorities in relation to the searches
and as such the operations of our Company has largely been unaffected, there can be no assurance that similar
searches will not be conducted by the authorities in the future. In case of any action taken by the authorities
against our Company, resulting out of such searches, our business, reputation and operations could be
adversely affected.

24. One of our Group Companies is in receipt of a letter dated January 13, 2020 from the Registrar of
Companies, Kerala & Lakshadweep (“RoC”) in relation to an ongoing investigation. Any adverse findings
by the RoC in this regard, could have a detrimental impact on the reputation of our Group, our common
Promoters and Directors.

Mini Muthoottu Nidhi Kerala Limited (“MMNL”), one of our Group Companies, received a letter dated
January 13, 2020 from the RoC (“Letter”), in relation to an investigation conducted under Section 210 (1)(a)
and 210 (1)(c) of the Companies Act (“Investigation”). In this regard the Central Government has appointed

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the RoC, along with Deputy Official Liquidator, Kerala and the Deputy Registrar of Companies, Kerala as
inspectors (“Inspecting Officers”). Vide the Letter, the Inspecting Officers have sought certain information
and documents from MMNL. MMNL, vide its letter dated January 28, 2020, has submitted the requisite
information and documents along with undertaking to submit certain other documents. Certain of our
Promoters and Directors are also the promoters and directors of MMNL. In the event the Inspecting Officers,
during the course of the Investigation, finding adversely against MMNL or any of its promoters or directors,
such findings could have a detrimental impact on the reputation of our Group, and that of our common
Promoters and Directors.

25. Our inability to open new branches at correct locations may adversely affect our business.

Our business is dependent on our ability to service and support our customers from proximate locations and
thereby giving our customers easy access to our services. Further, it is vital for us to be present in key locations
for sourcing business as we depend on these branches to earn revenue. Thus, any inability on our part to open
new branches at correct locations may adversely affect our business and results of operations.

26. Our branches are vulnerable to theft and burglary. While we are insured against the risk of burglary
arising from our business, such insurance may not be sufficient to fully cover the losses we suffer, and this
may result in adverse effect on our financial condition and results of operations.

Storage of pledged gold jewellery as part of our business entails the risk of theft/burglary and resulting loss
to our reputation and business. The short tenure of the loans advanced by us and our practice of processing
loan repayments within short timelines require us to store pledged gold on our premises at all points in time.
Some of our branches have had instances of burglaries in the past. With regard to all cases of theft/burglaries,
we may not be able to recover the entire amount of the loss suffered and may receive only a partial payment
of the insurance claim. While we are insured against the risk of burglary arising from our business, such
insurance may not be sufficient to fully cover the losses we suffer. Further, the actual recovery of the insured
amount from the insurer requires the undertaking of certain procedures, and any delay in recovery could
adversely affect our reputation and results of operation.

27. We are subject to the risk of fraud by our employees and customers. Our lending operations involve
significant amounts of cash collection which may be susceptible to loss or misappropriation or fraud by
our employees. Specifically, employees operating in remote areas may be susceptible to criminal elements
which may adversely affect our business, operations and ability to recruit and retain employees.

We are exposed to the risk of fraud and other misconduct by employees and customers. While we carefully
recruit all of our employees and screen all our employees who are responsible for disbursement of gold loans
and custody of gold, there could be instances of fraud with respect to gold loans and cash related
misappropriation by our employees. We are required to report cases of internal fraud to the RBI, which may
take appropriate action. We have also filed police complaints alleging fraud and misappropriation of gold by
our employees in the past. We cannot guarantee you that such acts of fraud will not be committed in the
future, and any such occurrence of fraud would adversely affect our reputation, business and results of
operations.

Our lending and collection operations involve handling of significant amounts of cash, including collections
of instalment repayments in cash which is the norm in the finance industry. Large amounts of cash collection
expose us to the risk of loss, fraud, misappropriation or unauthorised transactions by our employees
responsible for dealing with such cash collections. While we obtain insurance, coverage including fidelity
coverage and coverage for cash in safes and in transit and undertake various measures to detect and prevent
any unauthorised transactions, fraud or misappropriation by our employees, these measures may not be
sufficient to prevent or deter such activities in all cases, which may adversely affect our business operations
and financial condition. In addition, we may be subject to regulatory or other proceedings in connection with
any such unauthorised transaction, fraud or misappropriation by our agents or employees, which could
adversely affect our goodwill, business prospects and future financial performance.

Further, our employees operating in remote areas may be particularly susceptible to criminal elements as they
are involved in cash collection and transportation due to lack of local banking facilities. In the event of any
such adverse incident our ability to continue our operations in such areas will be adversely affected and our
employee recruitment and retention efforts may be affected, thereby affecting our expansion plans. In

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addition, if we determine that certain areas of India pose a significantly higher risk of crime or political strife
and instability, our ability to operate in such areas will be adversely affected.

28. We are subject to the risk of unknowingly receiving stolen goods as collateral from customers which may
result in loss of collateral for the loan disbursed.

We have in place a policy in place to satisfy ownership of the gold jewellery and have taken adequate steps
to ensure that the KYC guidelines stipulated by RBI are followed and due diligence of the customer is
undertaken prior to the disbursement of loans. However, in the event that we unknowingly receive stolen
goods as collateral from a customer, the goods can be seized by authorities. Once seized by the authorities,
gold items will be stored in court storage facilities without a surety arrangement. No recourse is generally
available to our Company in the event of such seizure, except the recovery of the loss from the customer. Any
seizure of the gold ornaments by the authorities shall result in us losing the collateral for the loan disbursed
and could adversely affect our reputation, business and results of operations.

29. Our insurance may not be adequate to protect us against all potential losses to which we may be subjected
to and if we were to incur a significant liability for which we were not fully insured, it could adversely
affect our business, results of operations and financial conditions.

We maintain insurance cover for our gold stock and cash with our branches, and cash in transit, against theft,
loss or damage by fire as well as against natural calamities including earthquake and floods. As on June 30,
2020, our Company has a total insurance cover of `2,04,000 lakhs. While we exercise due care in taking out
adequate cover, given the nature of fluctuating gold prices, the amount of our insurance coverage may be less
than the replacement cost of all covered property and may not be sufficient to cover all financial losses that
we may suffer should a risk materialise. There are many events that could significantly affect our operations,
or expose us to third party liabilities, for which we may not be adequately insured. If we were to incur a
significant liability for which we were not fully insured, it could adversely affect our business, results of
operations and financial condition.

30. We may experience difficulties in expanding our business into additional geographical markets in India,
which may adversely affect our business prospects, financial conditions and results of operations.

While the gold loans markets in the south Indian states of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh
and Telangana remains and is expected to remain our primary strategic focus, we also evaluate attractive
growth opportunities in other regions in India and have expanded our operations in the northern and western
states of India. We may not be able to leverage our experience in the states that we are present in to expand
our operations in other regions, should we decide to further expand our operations. Factors such as
competition, culture, regulatory regimes, business practices and customs, customer attitude, sentimental
attachments towards gold jewellery, behaviour and preferences in these cities where we may plan to expand
our operations may differ from those in south Indian states of Kerala, Tamil Nadu, Andhra Pradesh,
Telangana and Karnataka and our experience in these states of Kerala, Tamil Nadu, Andhra Pradesh,
Telangana and Karnataka may not provide us with benefits in other geographies. In addition, as we enter new
markets and geographical areas, we are likely to compete not only with other large banks and financial
institutions in the gold loan business, but also the local unorganised or semi-organised lenders, who are more
familiar with local conditions, business practices and customs, have stronger relationships with customers
and may have a more established brand name within local communities.

If we plan to further expand our geographical footprint, our business may be exposed to various additional
challenges, including obtaining necessary governmental approvals, identifying and collaborating with local
business partners with whom we may have no previous working relationship; successfully gauging market
conditions in new markets; attracting potential customers; being susceptible to local laws in new geographical
areas of India; and adapting our marketing strategy and operations to suit regions where different languages
are spoken. Our inability to expand our current operations in additional geographical markets may adversely
affect our growth, business prospects, financial conditions and results of operations.

31. We are not in compliance with the RBI Master Directions – Information Technology Framework for the
NBFC Sector.

RBI vide its master direction bearing reference no. [Link]. No.04/66.15.001/2016-17 dated June 8, 2017,
issued the IT framework for the NBFCs (“Framework”). RBI in its annual review has, in the past, observed

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non-compliance by our Company with the requirements of the Framework. Per a GAP analysis exercise
carried out by our Company, the major gaps in compliance, included, migration of IPV6 platform, digital
signatures, sharing of information on cyber security incidents with RBI, MIS for supervisory requirements,
business continuity policy, etc. According to the Framework, RBI had directed NBFCs-Systemically
Important to take necessary actions to be in compliance with the Framework by June 30, 2018. However, due
to factors not within the control of our Company, we have not been able to comply with the requirements of
the Framework. While we strive towards complying with all guidelines/directions issued by the RBI, in case
the RBI decides to take an adverse action/levy penalty against our Company, it could have a material adverse
effect on our business and results of operation.

32. System failures or inadequacy and security breaches in computer systems may adversely affect our
operations and result in financial loss, disruption of our businesses, regulatory intervention or damage to
our reputation.

We are vulnerable to risks arising from the failure of employees to adhere to approved procedures, failures
of security systems, computer system disruptions, communication systems failure and data interception
during transmission through external communication channels and networks. Failure to prevent or detect such
breaches in security or data and communications errors may adversely affect our operations.

Despite our internal controls, policies and procedures, certain matters such as fraud and embezzlement cannot
be eliminated entirely given the cash nature of our business. If we fail to maintain and continue to enhance
our internal controls, policies and systems, we may be unable to prevent fraud, security breaches or system
failures.

Our business is increasingly dependent on our ability to process, on a daily basis, a large number of
transactions. Our financial, accounting or other data processing systems may fail to operate properly or
become disabled as a result of events that are wholly or partially beyond our control, including a disruption
of electrical or communications services. If any of these systems do not operate properly or are disabled, or
if there are other shortcomings or failures in our internal processes or systems, financial loss, disruption of
our business, regulatory intervention or damage to our reputation may result. In addition, our ability to
conduct business may be adversely affected by a disruption in the infrastructure that supports our businesses
and the localities in which we are located. Our operations also rely on the secure processing, storage and
transmission of confidential and other information in our computer systems and networks. Our computer
systems, software and networks may be vulnerable to unauthorized access, computer viruses or other
malicious code and other events that could compromise data integrity and security. Constant connectivity
between our branches across India and our Corporate Office is key to the functioning of our business. Each
of our branches accesses the corporate data centre through the Internet, and all data is stored centrally in the
corporate data centre. Our disaster recovery system is fully operational, and we continue to engage in
technical exercises to test and improve our disaster plan.

33. Our ability to access capital also depends on our credit ratings. Any downgrade in our credit ratings would
increase borrowing costs and constrain our access to capital and lending markets and, as a result, would
negatively affect our net interest margin and our business.

The cost and availability of capital is also dependent on our short term and long term credit ratings. India
Ratings vide their rating rationale letter dated August 8, 2019 had rated our bank loans of `50,000 lakhs as
‘IND BBB-; Stable’ which was subsequently upgraded to ‘IND BBB’/Stable’ pursuant to their rationale letter
dated August 14, 2020. Further, our Company has received rating of ‘IND BBB’: Outlook Stable’ by India
Ratings vide its letter dated August 14, 2020 for the NCDs for an amount upto `40,000 lakhs including NCDs
proposed to be issued pursuant to this Issue. Ratings reflect a rating agency’s opinion of our financial strength,
operating performance, strategic position, and ability to meet our obligations. Any downgrade of our credit
ratings would increase borrowing costs and constrain our access to debt and bank lending markets and, as a
result, would adversely affect our business. In addition, downgrades of our credit ratings could increase the
possibility of additional terms and conditions being added to any new or replacement of financing
arrangements. For details regarding ratings received by our Company, please refer to “Our Business - Our
Borrowings and Credit Ratings” on page 103 and “Annexure II” on page 242.

34. We are subjected to supervision and regulation by the RBI as a systemically important NBFC, and changes
in RBI’s regulations governing us could adversely affect our business.

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We are subject to the RBI’s guidelines on financial regulation of NBFCs, including capital adequacy,
exposure and other prudential norms. The RBI also regulates the credit flow by banks to NBFCs and provides
guidelines to commercial banks with respect to their investment and credit exposure norms for lending to
NBFCs. The RBI’s regulations of NBFCs could change in the future which may require us to restructure our
activities, incur additional cost or could otherwise adversely affect our business and our financial
performance. Through the Master Directions, RBI has amended the regulatory framework governing NBFCs
to address concerns pertaining to risks, regulatory gaps and arbitrage arising from differential regulations and
aims to harmonise and simplify regulations to facilitate a smoother compliance culture among NBFCs.

Moreover, under the amendment, the threshold for defining systemic significance for NBFCs-ND has been
revised in the light of the overall increase in the growth of the NBFC sector. NBFCs-ND-SI will henceforth
be those NBFCs-ND which have asset size of `50,000 lakhs and above as per the last audited balance
sheet. Moreover, as per the requirements of the Master Directions, all NBFCs-ND with assets of `50,000
lakhs and above, irrespective of whether they have accessed public funds or not, shall comply with prudential
requirements as applicable to NBFCs-ND-SI. We cannot assure you that the Master Directions and its
applicability to us will not have a material and adverse effect on our future financial conditions and results of
operations.

Even though the RBI, has not provided for any restriction on interest rates that can be charged by non-deposit
taking NBFCs, there can be no assurance that the RBI and/or the Government will not implement regulations
or policies, including policies or regulations or legal interpretations of existing regulations, relating to or
affecting interest rates, taxation, inflation or exchange controls, or otherwise take action, that could have an
adverse effect on non-deposit taking NBFCs. In addition, there can be no assurance that any changes in the
laws and regulations relative to the Indian financial services industry will not adversely impact our business.

35. We may be subject to regulations in respect of provisioning for non-performing assets. If such provisions
are not sufficient to provide adequate cover for loan losses that may occur, this could have an adverse
effect on our financial condition, liquidity and results of operations.

RBI guidelines prescribe the provisioning required in respect of our outstanding loan portfolio. These
provisioning requirements may require us to reserve lower amounts than the provisioning requirements
applicable to financial institutions and banks in other countries. The provisioning requirements may also
require the exercise of subjective judgments of management. The RBI vide the Master Directions provides
for the regulatory framework governing NBFCs pertaining to provisioning for standard assets. The
requirement to make a provision for standard assets over a period of three years, i.e., 0.30% by the end of
March 2016, 0.35% by the end of March 2017 and 0.40% by the end of March 2018 and thereafter, of the
outstanding.
There are multiple factors that affect the level of NPAs in our Company. Prominent among them are fall in
value of gold, increase in the LTV ratio for gold loan etc.

The level of our provisions may not be adequate to cover further increases in the amount of our nonperforming
assets or a decrease in the value of the underlying gold collateral. If such provisions are not sufficient to
provide adequate cover for loan losses that may occur, or if we are required to increase our provisions, this
could have an adverse effect on our financial condition, liquidity and results of operations and may require
us to raise additional capital.

36. Microfinance loans are unsecured and are susceptible to certain operational and credit risks which may
result in increased levels of NPAs.

As of March 31, 2020, our microfinance AUM was `4,537.76 lakhs, representing 2.68% of our aggregate
AUM as of such date. Our microfinance customers typically belong to the economically weaker sections and
are diverse in nature, which include customers involved in income generating business activities, with limited
sources of income, savings and credit records, and are therefore unable to provide us with any collateral or
security for their loans. Such customers are at times unable to or may not provide us with accurate information
about themselves which is required by us in connection with loans.

In our microfinance business, we rely on non-traditional guarantee mechanisms rather than any tangible assets
as security collateral. Our microfinance business involves a joint liability mechanis m whereby borrowers
form a joint liability group and provide guarantees for loans obtained by each member of such group. There
can however be no assurance that such joint liability arrangements will ensure repayment by the other

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members of the joint liability group in the event of default by any one of them. Such joint liability
arrangements are likely to fail if there is no meaningful personal relationship or bond among members of
such group, if inadequate risk management procedures have been employed to verify the group members and
their ability to repay such loans, or as a result of adverse external factors such as natural calamities and
forced migration.

As a result, our micro finance customers potentially present a higher risk of loss in case of a cred it default
compared to that of customers in other asset-backed financing products. In addition, repayment of
microfinance loans are susceptible to various political and social risks, including any adverse publicity relating
to the microfinance sector accessing capital markets, public criticism of the microfinance sector, the
introduction of a stringent regulatory regime, and/or religious beliefs relating to loans and interest payments,
which adversely affect repayment by our customers and may have a material and adverse effect on our
business prospects and future financial performance.

There can be no assurance that we will be able to maintain our current levels of NPAs. In addition, it is difficult
to accurately predict credit losses, and there can be no assurance that our monitoring and risk management
procedures will succeed in effectively predicting such losses or that our loan loss reserves will be sufficient
to cover any such actual losses. As a result of the uncertain financial and social circumstances of our
microfinance customers and the higher risks associated with lending to such customers, we may experience
increased levels of NPAs and we may be required to make related provisions and write-offs that could have
a material and adverse effect on our business prospects and financial performance.

37. Our microfinance business involves transactions with relatively high-risk borrowers that typically do not
have access to formal banking channels, and high levels of customer defaults could adversely affect
our business, results of operations and financial condition.

Our microfinance business involves lending money to smaller, relatively low-income women
entrepreneurs who have limited access or no access to formal banking channels, and therefore may not have
any credit history and as a result we are more vulnerable to customer default risks including default or
delay in repayment of principal or interest on our loans.

Some of our customers, especially the first-time borrowers, may not have any documented credit history, may
have limited formal education, and are able to furnish very limited information for us to be able to assess
their creditworthiness accurately. Consequently, we may not have past data on the customer’s borrowing
behaviour. In addition, we may not receive updated information regarding any change in the financial
condition of our customers or may receive inaccurate or incomplete information as a result of any fraudulent
misrepresentation on the part of our customers. It is therefore difficult to carry out credit risk analysis on
our clients. Although we believe that our risk management controls are stringently applied, there can be
no assurance that they will be sufficient or that additional risk management strategies for our customers will
not be required.

Further, our customers may default on their obligations as a result of various factors including bankruptcy,
lack of liquidity and / or failure of the business or commercial venture in relation to which such borrowings
were sanctioned. Although our microfinance business operates through a system of joint liability, we may
still be exposed to defaults in payment, which we may not be able to recover in full. If our borrowers fail to
repay loans in a timely manner or at all, our financial condition and results of operations will be adversely
impacted.

38. Our ability to borrow from various banks may be restricted on account of guidelines issued by the RBI
imposing restrictions on banks in relation to their exposure to NBFCs. Any limitation on our ability to
borrow from such banks may increase our cost of borrowing, which could adversely impact our growth,
business and financial condition.

Under RBI Master Circular [Link].5/21.04.172/2015-16 on bank finance to NBFCs issued on July
1, 2015, the exposure (both lending and investment, including off balance sheet exposures) of a bank to a
single NBFC engaged in lending against collateral of gold jewellery (i.e. such loans comprising 50% or more
of its financial assets) should not exceed 7.5%, of its capital funds. Banks may, however, assume exposures
on a single NBFC up to 12.5%, of their capital funds, provided the exposure in excess of 7.5% is on account
of funds on-lent by the NBFC to the infrastructure sector. Further, banks may also consider fixing internal
limits for their aggregate exposure to all NBFCs put together and should include internal sub-limit to all

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NBFCs providing Gold Loans (i.e. such loans comprising 50% or more of their financial assets), including
us. This limits the exposure that banks may have on NBFCs such as us, which may restrict our ability to
borrow from such banks and may increase our cost of borrowing, which could adversely impact our growth,
business and financial condition.

39. Attrition rate in our business is quite high and in order to be successful, we must attract, retain and
motivate key employees, and failure to do so could adversely affect our business. Failure to hire key
executives or employees could have a significant impact on our operations.

In order to be successful, we are required to attract, train, motivate and retain highly skilled employees,
especially branch managers and gold assessment technical personnel. If we cannot hire additional personnel
or retain existing qualified personnel, our ability to expand our business will be impaired and our revenue
could decline. Hiring and retaining qualified and skilled managers and sales representatives are critical to our
future, and competition for experienced employees in the gold loan industry can be intense. In addition, we
may not be able to hire and retain enough skilled and experienced employees to replace those who leave or
may not be able to re-deploy and retain our employees to keep pace with continuing changes in technology,
evolving standards and changing customer preferences. The failure to hire key executives or employees could
have a significant impact on our operations.

40. We have entered into certain transactions with related parties. Any transaction with related parties may
involve conflicts of interest.

We have entered into transactions with several related parties, including our Promoters, Directors and related
entities. We can give no assurance that we could not have achieved more favourable terms had such
transactions not been entered into with related parties. Furthermore, it is likely that we will enter into related
party transactions in the future. There can be no assurance that such transactions, individually or in the
aggregate, will not have an adverse effect on our financial condition and results of operations. The
transactions we have entered into and any future transactions with our related parties have involved or could
potentially involve conflicts of interest.

For details regarding our related party transactions entered into by us during the previous five Fiscals, please
refer to “Related Party Transactions” on page 117.

41. Our Promoters, Directors and related entities have interests in a number of entities, which are in businesses
similar to ours and this may result in potential conflicts of interest with us.

Certain decisions concerning our operations or financial structure may present conflicts of interest among our
Promoters, other Shareholders, Directors, and other related entities. Our Promoters, Directors and related
entities have interests in the following entities that are engaged in businesses similar to ours:

1. Mini Muthoottu Nidhi (Kerala) Limited;

2. Cochin Mini Muthoottu Nidhi Limited; and
3. Muthoottu Mini Nidhi Limited

Commercial transactions in the future between us and related parties could result in conflicting interests. A
conflict of interest may occur directly or indirectly between our business and the business of our Promoters
which could have an adverse effect on our operations. Conflicts of interest may also arise out of common
business objectives shared by us, our Promoters, Directors and their related entities. Our Promoters, Directors
and their related entities may compete with us and have no obligation to direct any opportunities to us. There
can be no assurance that these or other conflicts of interest will be resolved in an impartial manner.

42. We are required to comply with the requirements of certain labour laws which may impose additional costs
on us.

Our branches are required to be registered under the relevant shops and establishments laws and verifications
under Standards of Weights and Measures Act, 1976 of the states in which they are located. The shops and
establishment laws regulate various employment conditions, including working hours, holidays, leave and
overtime compensation. If we fail to obtain or retain any of these approvals, exemptions or licenses, or
renewals thereof, in a timely manner, or at all, our business may be adversely affected. If we fail to comply,

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or a regulator claims we have not complied, with any conditions, our certificate of registration may be
suspended or cancelled, and we may not be able to carry on such activities.

In addition, our employees are required to be registered under the provisions of certain labour laws such as
the Employees’ State Insurance Act, 1948, the Payment of Gratuity Act, 1972 the Kerala Shops and
Commercial Establishments Act, 1960, the Kerala Labour Welfare Fund Act, 1975, and the Employees
Provident Fund and Miscellaneous Provisions Act, 1952. We are also required to maintain certain records
under the provisions of these laws, which add to our costs. If we are subject to penalties under these labour
laws or if we do not obtain the requisite approvals, our business, financial condition and results of operations
may be adversely affected.

43. Our inability to obtain, renew or maintain our statutory and regulatory permits and approvals required to
operate our business may have a material adverse effect on our business, financial condition and results
of operations.

NBFCs in India are subject to strict regulations and supervision by the RBI. In addition to the numerous
conditions required for the registration as a NBFC with the RBI, we are required to maintain certain statutory
and regulatory permits and approvals for our business. In the future, we will be required to renew such permits
and approvals and obtain new permits and approvals for any proposed operations. There can be no assurance
that the relevant authorities will issue any of such permits or approvals in the time-frame anticipated by us or
at all. Failure on our part to renew, maintain or obtain the required permits or approvals may result in the
interruption of our operations and may have a material adverse effect on our business, financial condition and
results of operations.

In addition, our branches are required to be registered under the relevant shops and establishments laws of
the states in which they are located. The shops and establishment laws regulate various employment
conditions, including working hours, holidays and leave and overtime compensation. If we fail to obtain or
retain any of these approvals or licenses, or renewals thereof, in a timely manner, or at all, our business may
be adversely affected. If we fail to comply, or a regulator claims we have not complied, with any of these
conditions, our certificate of registration may be suspended or cancelled, and we shall not be able to carry on
such activities.

44. All our branch premises, except nine branches, are acquired on lease. Any termination of arrangements
for lease of our branches or our failure to renew the same in a favourable, timely manner, could adversely
affect our business and results of operations.

As on June 30, 2020, we had 785 branches in nine states and one union territory. Except nine branches which
are owned by us, the remaining are located on leased premises. If any of the owners of these premises does
not renew an agreement under which we occupy the premises, attempts to evict us or seeks to renew an
agreement on terms and conditions non-acceptable to us, we may suffer a disruption in our operations or
increased costs, or both, which may adversely affect our business and results of operations.

Further, some of our lease deeds for our properties may not be registered and further some of our lease deeds
may not be adequately stamped and consequently, may not be accepted as evidence in a court of law and we
may be required to pay penalties for inadequate stamp duty. Further, we may not be able to assess or identify
all risks and liabilities associated with any properties, such as faulty or disputed title, unregistered
encumbrances or adverse possession rights, improperly executed, unregistered or insufficiently stamped
instruments, or other defects that we may not be aware of.

45. We have ventured into new business areas and the sustainability, effective management and failure of
growth strategy could adversely affect our business and result of operations.

We have entered new businesses as part of our growth strategy. For example, we have entered into corporate
agency agreements with insurance companies, to act as their corporate agent for soliciting or procuring
insurance business. We have also entered into agreements for money transfer business including with certain
money transfer companies to act in the capacity of their sub-representative to offer money transfer services.
Our Company has also entered into an agreement with a tour and travel company to act as its sub-agent, to
provide travel related activities. Additionally, our Company has also started the microfinance business in
Fiscal 2017.

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We have little or no operating experience with such businesses, and you should consider the risks and
difficulties we may encounter by entering into new lines of business. New businesses may require capital
investments and commitments of time from our senior management, and there often is little or no prospect of
earnings in a new business for several years. Moreover, there is no assurance any new business we develop
or enter will commence in accordance with our timelines, if at all, which could result in additional costs and
time commitments from our senior management. There also can be no assurance that our management will
be able to develop the skills necessary to successfully manage these new business areas. Our inability to
effectively manage any of the above issues could materially and adversely affect our business and impact our
future financial performance.

46. We rely significantly on our management team, our Key Managerial Personnel and our ability to attract
and retain talent. Loss of any member from our management team or that of our Key Managerial
Personnel may adversely affect our business and results of operation.

We rely significantly on our core management team which oversees the operations, strategy and growth of
our businesses. Our Key Managerial Personnel have been integral to our development. Our success is largely
dependent on our management team which ensures the implementation of our strategy. If one or more
members of our management team are unable or unwilling to continue in their present positions, they may be
difficult to replace, and our business and results of operation may be adversely affected.

47. Certain of our records including in relation to share transfer to one of our Promoters/Directors are not
traceable.

Certain of our records in relation to filings under Companies Act and Board resolution related to the details
of transfer of Equity Shares made to Mathew Muthoottu, one of our Promoters/Directors, are not traceable.
Further, we have been unable to trace copies of the transfer deeds for such transfer of Equity Shares. We have
relied on the records and registers available with the Company to provide the build-up of the Equity
Shareholding of Mathew Muthoottu in our Company. While we continue to conduct a search for such records,
we cannot assure you that such records will be available in the future or that we will not be subject to penalties
which may be imposed by the RoC in this regard. We cannot assure you that such delays may not occur in
the future, which may affect our results of operations and business prospects.

RISKS PERTAINING TO THIS ISSUE

48. Changes in interest rates may affect the price of our NCDs which frequently accompany inflation and/or
a growing economy, are likely to have a negative effect on the price of our NCDs.

All securities where a fixed rate of interest is offered, such as our NCDs, are subject to price risk. The price
of such securities will vary inversely with changes in prevailing interest rates, i.e., when interest rates rise,
prices of fixed income securities fall and when interest rates drop, the prices increase. The extent of fall or
rise in the prices is a function of the existing coupon, days to maturity and the increase or decrease in the level
of prevailing interest rates. Increased rates of interest, which frequently accompany inflation and/or a growing
economy, are likely to have a negative effect on the price of our NCDs.

49. You may not be able to recover, on a timely basis or at all, the full value of the outstanding amounts and/or
the interest accrued thereon in connection with the NCDs. Failure or delay in recovering the expected
value from a sale or disposition of the assets charged as security in connection with the NCDs could expose
you to a potential loss.

Our ability to pay interest accrued on the NCDs and/or the principal amount outstanding from time to time in
connection therewith would be subject to various factors inter alia including our financial condition,
profitability and the general economic conditions in India and in the global financial markets. We cannot
assure you that we would be able to repay the principal amount outstanding from time to time on the NCDs
and/or the interest accrued thereon in a timely manner or at all.

Further, in case of NCDs, although our Company will create appropriate security in favour of the Debenture
Trustee for the Debenture Holders on the assets, adequate to ensure 100.00% asset cover for the total value
of the NCDs, which shall be free from any encumbrances, the realisable value of the assets charged as
security, when liquidated, may be lower than the outstanding principal and/or interest accrued thereon in
connection with the NCDs. A failure or delay in recovering the expected value from a sale or disposition of

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the assets charged as security in connection with the NCDs could expose you to a potential loss. For further
details see “Outstanding Litigations” on page 181.

50. There is no assurance that the NCDs issued pursuant to this Issue will be listed on BSE Limited in a timely
manner, or at all.

In accordance with Indian law and practice, permission for listing and trading of the NCD issued pursuant to
this Issue will not be granted until after the NCDs have been issued and allotted. Approval for listing and
trading will require all relevant documents authorising the issue of NCDs to be submitted. There could be a
failure or delay in listing the NCDs in BSE.

51. There may be no active market for the NCDs on the retail debt market/capital market segment of the BSE.
As a result, the liquidity and market prices of the NCDs may fail to develop and may accordingly be
adversely affected.

There can be no assurance that an active market for the NCDs will develop. If an active market for the NCDs
fails to develop or be sustained, the liquidity and market prices of the NCDs may be adversely affected. The
market price of the NCDs would depend on various factors inter alia including (i) the interest rate on similar
securities available in the market and the general interest rate scenario in the country, (ii) the market price of
our Equity Shares, (iii) the market for listed debt securities, (iv) general economic conditions, and, (v) our
financial performance, growth prospects and results of operations. The aforementioned factors may adversely
affect the liquidity and market price of the NCDs, which may trade at a discount to the price at which you
purchase the NCDs and/or be relatively illiquid.

52. Our Company may raise further borrowings and charge its assets after receipt of necessary consents from
its existing lenders. In such a scenario, the Debenture Holders holding NCDs will rank pari passu with
other secured creditors and to that extent, may reduce the amounts recoverable by the Debenture Holders
upon our Company’s bankruptcy, winding up or liquidation

Our Company may, subject to receipt of all necessary consents from its existing lenders and the Debenture
Trustee to the Issue, raise further borrowings and charge its assets. Our Company is free to decide the nature
of security that may be provided for future borrowings. In such a scenario, the Debenture Holders holding
NCDs will rank pari passu with other creditors and to that extent, may reduce the amounts recoverable by the
Debenture Holders upon our Company’s bankruptcy, winding up or liquidation.

53. Payments to be made on the NCDs are subordinated to certain taxes and other liabilities preferred by law.
In the event of bankruptcy, liquidation or winding up, there may not be sufficient assets of our Company
remaining, to pay amounts due on the NCDs.

The NCDs will be subordinated to certain liabilities preferred by law such as the claims of the Government
on account of taxes, and certain liabilities incurred in the ordinary course of our business. In particular, in the
event of bankruptcy, liquidation or winding-up, our Company’s assets will be available to pay obligations on
the NCDs only after all of those liabilities that rank senior to the NCDs have been paid as per Section 327 of
the Companies Act, 2013 or Section 53 of the Insolvency and Bankruptcy Code, 2016, as the case maybe. In
the event of bankruptcy, liquidation or winding-up, there may not be sufficient assets remaining to pay
amounts, due on the NCDs.

54. The fund requirement and deployment mentioned in the Objects of the Issue have not been appraised by
any bank or financial institution.

We intend to use the proceeds of the Issue, after meeting the expenditures of and related to the Issue, for the
purpose of onward lending and for repayment of interest and principal of existing loans and also for general
corporate purposes. For further details, see “Objects of the Issue” at page 61. The fund requirement and
deployment are based on internal management estimates and has not been appraised by any bank or financial
institution. The management will have significant flexibility in applying the proceeds received by us from the
Issue. Further, as per the provisions of the SEBI Debt Regulations, we are not required to appoint a monitoring
agency and therefore no monitoring agency has been appointed for the Issue.

55. The liquidity for the NCDs in the secondary market is very low and it may remain so in the future and the
price of the NCDs may be volatile.

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 Muthoottu Mini Financiers Limited

The Issue will be a new public issue of NCDs for our Company and the liquidity in NCDs at present is very
low in the secondary market. Although an application has been made to list the NCDs on BSE, there can be
no assurance that liquidity for the NCDs will improve, and if liquidity for the NCDs were to improve, there
is no obligation on us to maintain the secondary market. The liquidity and market prices of the NCDs can be
expected to vary with changes in market and economic conditions, our financial condition and prospects and
other factors that generally influence market price of NCDs. Such fluctuations may significantly affect the
liquidity and market price of the NCDs, which may trade at a discount to the price at which you purchase
the NCDs.

56. We cannot guarantee the accuracy or completeness of facts and other statistics with respect to India, the
Indian economy and the NBFC and Gold Loan industry contained in this Prospectus.

While facts and other statistics in this Prospectus relating to India, the Indian economy as well as the gold
loan industry have been based on various publications and reports from agencies that we believe are reliable,
we cannot guarantee the quality or reliability of such materials, particularly since there is limited publicly
available information specific to the Gold Loan industry. While we have taken reasonable care in the
reproduction of such information, industry facts and other statistics, the same have not been prepared or
independently verified by us or any of our respective affiliates or advisors and, therefore we make no
representation as to their accuracy or completeness. These facts and other statistics include the facts and
statistics included in the chapter titled “Industry Overview” beginning on page 64. Due to possibly flawed or
ineffective data collection methods or discrepancies between published information and market practice and
other problems, the statistics herein may be inaccurate or may not be comparable to statistics produced
elsewhere and should not be unduly relied upon. Further, there is no assurance that they are stated or compiled
on the same basis or with the same degree of accuracy, as the case may be, elsewhere.

External Risk Factors

57. Financial difficulties and other problems in certain financial institutions in India could cause our business
to suffer and adversely affect our results of operations.

We are exposed to the risks of the Indian financial system, which in turn may be affected by financial
difficulties and other problems faced by certain Indian financial institutions. Certain Indian financial
institutions have experienced difficulties during recent years. Some co-operative banks (which tend to operate
in rural sector) have also faced serious financial and liquidity crises. There has been a trend towards
consolidation with weaker banks, NBFCs and HFCs being merged with stronger entities. The problems faced
by individual Indian financial institutions and any instability in or difficulties faced by the Indian financial
system generally could create adverse market perception about Indian financial institutions, banks and
NBFCs. This in turn could adversely affect our business, our future financial performance, our shareholders’
funds and the market price of our NCDs.

58. Terrorist attacks, civil unrest and other acts of violence or war involving India and other countries could
adversely affect the financial markets and our business.

Terrorist attacks and other acts of violence or war may negatively affect our business and may also adversely
affect the worldwide financial markets. These acts may also result in a loss of business confidence. In
addition, any deterioration in relations between India and its neighbouring countries might result in investor
concern about stability in the region, which could adversely affect our business.

India has also witnessed civil disturbances in recent years, and it is possible that future civil unrest as well as
other adverse social, economic and political events in India could have a negative impact on us. Such incidents
could also create a greater perception that investment in Indian companies involves a higher degree of risk
and could have an adverse impact on our business and the market price of our NCDs.

59. Natural calamities could have a negative impact on the Indian economy, particularly the agriculture
sector, and cause our business to suffer.

India has experienced natural calamities such as earthquakes, a tsunami, floods and drought in the past few
years. The extent and severity of these natural disasters determines their impact on the Indian economy.

34
 Muthoottu Mini Financiers Limited

Further, prolonged spells of below normal rainfall or other natural calamities could have a negative impact
on the Indian economy thereby, adversely affecting our business.

60. Any downgrading of India’s debt rating by an international rating agency could have a negative impact
on our business.

Any adverse revisions to India’s credit ratings for domestic and international debt by international rating
agencies may adversely impact our ability to raise additional financing, the interest rates and other
commercial terms at which such additional financing is available. This could have a material adverse effect
on our business and financial performance, our ability to raise financing for onward lending and the price of
our NCDs.

61. Instability of economic policies and the political situation in India could adversely affect the fortunes of
the industry.

There is no assurance that the liberalisation policies of the government will continue in the future. Protests
against privatization could slow down the pace of liberalisation and deregulation. The Government of India
plays an important role by regulating the policies and regulations that govern the private sector. The current
economic policies of the government may change at a later date. The pace of economic liberalisation could
change and specific laws and policies affecting the industry and other policies affecting investments in our
Company’s business could change as well. A significant change in India’s economic liberalisation and
deregulation policies could disrupt business and economic conditions in India and thereby affect our
Company’s business.

Unstable domestic as well as international political environment could impact the economic performance in
the short term as well as the long term. The Government of India has pursued the economic liberalisation
policies including relaxing restrictions on the private sector over the past several years. The present
Government has also announced polices and taken initiatives that support continued economic liberalisation.

The Government has traditionally exercised and continues to exercise a significant influence over many
aspects of the Indian economy. Our Company’s business may be affected not only by changes in interest
rates, changes in Government policy, taxation, social and civil unrest but also by other political, economic or
other developments in or affecting India.

PROMINENT NOTES

1. This is a public issue of NCDs by our Company aggregating up to `10,000 lakhs with an option to retain
over-subscription up to `10,000 lakhs, aggregating to a total of `20,000 lakhs.

2. For details on the interest of our Company’s Directors, please see “Our Management” and “Capital Structure”
beginning on pages 108 and 44, respectively.

3. Our Company has entered into certain related party transactions and disclosed in “Financial Statements”
beginning on page 118.

4. Any clarification or information relating to the Issue shall be made available by the Lead Manager and our
Company to the investors at large and no selective or additional information would be available for a section
of investors in any manner whatsoever.

5. Investors may contact the Registrar to the Issue, Compliance Officer and Lead Manager for any complaints
pertaining to the Issue. In case of any specific queries on allotment/refund, Investor may contact Registrar to
the Issue. All grievances arising out of Applications for the NCDs made through the Online Stock Exchange
Mechanism or through Trading Members may be addressed directly to the respective Stock Exchange.

6. In the event of oversubscription to the Issue, allocation of NCDs will be as per the “Issue Procedure - Basis
of Allotment” on page 175.

7. Our Equity Shares are currently unlisted.

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 Muthoottu Mini Financiers Limited

8. Our previous public issues of non-convertible debentures are currently listed on BSE.

9. Our Company has had contingent liabilities amounting to `607.19 lakhs as of March 31, 2020.

10. For further information, relating to certain significant legal proceedings that we are involved in, see
“Outstanding Litigations” on page 181.

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 Muthoottu Mini Financiers Limited

SECTION III – INTRODUCTION

GENERAL INFORMATION

Our Company was originally incorporated as ‘Muthoottu Mini Financiers Private Limited’, a private limited
company under the provisions of the Companies Act, 1956, pursuant to a certificate of incorporation dated March
18, 1998 issued by the RoC. Pursuant to a special resolution passed in the general meeting of our Shareholders held
on September 14, 2013, our Company was converted into a public limited company and a fresh certificate of
incorporation was issued by the RoC on November 27, 2013, and our name was changed to ‘Muthoottu Mini
Financiers Limited’. For further details about our Company, see “History and Certain Other Corporate Matters” on
page 105.

Registration

The registration number and corporate identity number of our Company are as follows:

(a) Company Registration Number with RoC: 012154

(b) Corporate Identification Number issued by the RoC: U65910KL1998PLC012154

Our Company has obtained a certificate of registration dated April 13, 2002 bearing registration no. – N-16.00175
issued by the RBI to carry on the activities of a NBFC under Section 45 IA of the RBI Act. Our Company is a
systemically important non-deposit taking NBFC. Further, a fresh certificate of registration was issued by RBI on
January 1, 2014, pursuant to the change of name of our Company from ‘Muthoottu Mini Financiers Private
Limited’ to ‘Muthoottu Mini Financiers Limited.’

Our Company has also obtained a certificate of registration bearing registration no. – CA0122 issued by IRDAI,
with effect from April 1, 2016, under Section 42D (1) of the Insurance Act, to act as a “Corporate Agent
(Composite)” (renewed from April 1, 2019).

Our Company holds a certificate of registration dated July 5, 2012 bearing registration number IN–DP–CDSL–
660-2012 issued by SEBI to act as Depository Participant in terms of Regulation 20 of the Securities and Exchange
Board of India (Depositories and Participants) Regulations, 1996, renewed on August 21, 2017.

Registrar of Companies

Our Company is registered with the Registrar of Companies, Kerala and Lakshadweep, which is situated at the
following address:

Company Law Bhavan

BMC Road, Thrikkakara
Kochi – 682 021, Kerala, India
Telephone: +91 484 242 3749
Facsimile: NA

Registered Office

2/994, Muthoottu Buildings

Kozhencherry
Pathanamthitta – 689 641
Kerala, India
Telephone: +91 468 231 4391
Facsimile: NA
E-mail: cs@[Link]
Website: [Link]

Corporate Office

Muthoottu Royal Towers

Kaloor, Kochi – 682 017

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 Muthoottu Mini Financiers Limited

Kerala, India
Telephone: +91 484 291 2100
Facsimile: NA
E-mail: cs@[Link]
Website: [Link]

Board of Directors

The following table sets out the details regarding the Board of Directors as on the date of this Prospectus:

Name Designation DIN Address

Nizzy Mathew Chairman and 01680739 Muthoottu House, Kozhencherry, Pathanamthitta –
Wholetime Director 689 641, Kerala, India
Mathew Muthoottu Managing Director 01786534 Muthoottu House, Kozhencherry, Pathanamthitta –
689 641, Kerala, India
Thomas Cherian Independent Director 00492598 Angadisseril House, Kollad P.O., Kottayam – 686
289, Kerala, India
Rajagopal M.S. Non-Executive Director 08114376 Sreemangalam, Ambedkar Colony, Thiruvarppu
P.O, Kottayam – 686 020, Kerala, India
Maliakal Jose Paul Independent Director 07218120 Chethalan, Church Road, Pariyaram, Thrissur – 680
721, Kerala, India
Rudran Puthukulangara Additional Independent 00546638 18, Green Gardens 73/452, Karshaka Road, Off S R
Director* M Road, Vaduthala, Ernakulam - 682023, Kerala,
India
*Subject to approval by the Shareholders.

For further details of Directors of our Company, please see “Our Management” on page 108.

Chief Financial Officer

Ann Mary George

Muthoottu Royal Towers
Kaloor, Kochi – 682 017
Kerala, India
E-mail: annmary@[Link]
Telephone: +91 484 291 2107
Facsimile: NA

Company Secretary and Compliance Officer

Smitha K. S.
Muthoottu Royal Towers
Kaloor, Kochi – 682 017
Kerala, India
E-mail: cs@[Link]
Telephone: +91 484 291 2178
Facsimile: NA

Investors may contact the Registrar to the Issue or the Compliance Officer in case of any pre-Issue or post Issue
related issues such as non-receipt of Allotment Advice, demat credit of allotted NCDs or refund orders.

All grievances relating to the Issue may be addressed to the Registrar to the Issue, giving full details such as name,
Application Form number, address of the Applicant, number of NCDs applied for, amount paid on Application,
Depository Participant and the Collection Centres of the Members of the Syndicate where the Application was
submitted.

All grievances relating to the ASBA process may be addressed to the Registrar to the Issue with a copy to the
relevant SCSB, giving full details such as name, address of Applicant, Application Form number, number of
NCDs applied for, amount blocked on Application and the Designated Branch or the Collection Centres of the
SCSB where the Application Form was submitted by the ASBA Applicant.

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 Muthoottu Mini Financiers Limited

All grievances relating to ASBA process where the Application is submitted to a Member of Syndicate should be
addressed to the Registrar to the Issue with a copy to the relevant Member of Syndicate and the relevant SCSB.
All grievances arising out of Applications for the NCDs made through the Online Stock Exchange Mechanism or
through Trading Members may be addressed directly to the Stock Exchange.

Lead Manager to the Issue

Vivro Financial Services Private Limited

607/608 Marathon Icon
Opposite Peninsula Corporate Park
Off. Ganpatrao Kadam Marg
Veer Santaji Lane, Lower Parel
Mumbai- 400 013
Maharashtra, India
Telephone: +91 22 6666 8040/41/42
Facsimile: +91 22 6666 8047
Email: mmfl@[Link]
Investor Grievance Email: investors@[Link]
Website: [Link]
Contact Person/Compliance Officer: Jayesh Vithlani
SEBI Registration No.: INM000010122

Debenture Trustee

Vistra ITCL (India) Limited

The IL&FS Financial Centre
Plot C – 22, G Block
Bandra Kurla Complex, Bandra (East)
Mumbai – 400 051
Telephone: +91 22 2659 3333
Facsimile: +91 22 2653 3297
Email: itclcomplianceofficer@[Link]
Investor Grievance mail: itclcomplianceofficer@[Link]
Website: [Link]
Contact Person: Jatin Chonani – Compliance Officer
SEBI Registration Number: IND000000578

Vistra ITCL (India) Limited has by its letter dated August 7, 2020 given its consent for its appointment as
Debenture Trustee to the Issue and for its name to be included in the Prospectus and in all the subsequent periodical
communications to be sent to the holders of the NCDs issued pursuant to this Issue.

All the rights and remedies of the NCD Holders under this Issue shall vest in and shall be exercised by the
appointed Debenture Trustee for this Issue without having it referred to the NCD Holders. All investors under this
Issue are deemed to have irrevocably given their authority and consent to the Debenture Trustee so appointed by
our Company for this Issue to act as their trustee and for doing such acts and signing such documents to carry out
their duty in such capacity. Any payment by our Company to the NCD Holders/Debenture Trustee, as the case
may be, shall, from the time of making such payment, completely and irrevocably discharge our Company pro
tanto from any liability to the NCD Holders. For details on the terms of the Debenture Trust Deed see, “Issue
Related Information” on page 136 of this Prospectus.

Registrar to the Issue

Link Intime India Private Limited

C-101, 247 Park
L.B.S. Marg, Vikhroli (West)
Mumbai 400 083
Maharashtra, India
Telephone: +91 22 4918 6200
Facsimile: +91 22 4918 6195
Email: ncd2.mmfl2020@[Link]

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 Muthoottu Mini Financiers Limited

Investor Grievance mail: ncd2.mmfl2020@[Link]

Website: [Link]
Contact Person: Shanti Gopalkrishnan
SEBI Registration Number: INR000004058

Credit Rating Agency

India Ratings and Research Private Limited

Wockhardt Towers, 4th Floor, Bandra Kurla Complex
Bandra East
Mumbai – 400 051
Telephone: + 91 22 4000 1700
Facsimile: + 91 22 4000 1701
Email: [Link]@[Link]
Investor Grievance mail: [Link]@[Link]
Website: [Link]
Contact Person: Shrikant Dev, Compliance Officer
SEBI Registration Number: IN/CRA/002/1999

Legal Advisor to the Issue

Khaitan & Co
One World Centre
10th & 13th Floors, Tower 1C
841 Senapati Bapat Marg
Mumbai – 400 013
Maharashtra, India
Telephone: + 91 22 6636 5000

Statutory Auditors

Vishnu Rajendran & Co., Chartered Accountants

3rd Floor, CSI Commercial Centre
Baker Jn., P.B. No. 227
Kottayam - 686 001
Telephone: 0481 2301999
Facsimile: NA
Email: kottayam@[Link]
Firm Registration No: 004741S
Contact Person: CA. P.A. Joseph-Partner
Peer Review No: 011622

Public Issue Account Bank and Refund Bank

HDFC Bank Limited

Lodha, I Think Techno Campus O-3 Level
Next to Kanjurmarg Railway Station
Kanjurmarg (East)
Mumbai 400 042
Telephone: +91 22 30752929/2928/2914
Email:[Link]@[Link];[Link]@[Link];[Link]@[Link];prasanna.
uchil@[Link]
Website: [Link]
Contact Person: Vincent Dsouza, Siddharth Jadhav, Prasanna Uchil

Syndicate Member

Vivro Financial Services Private Limited

607/608, Marathon Icon
Opposite Peninsula Corporate Park

40
 Muthoottu Mini Financiers Limited

Off Ganpatrao Kadam Marg

Veer Santaji Lane
Lower Parel, Mumbai 400 013
Telephone: +91 22 6666 8040/41/42
Facsimile: +91 22 6666 8047
Email: mmfl@[Link]
Investor Grievance e-mail: investors@[Link]
Contact Person: Tushar Ashar
Compliance Office: Jayesh Vithlani
SEBI Registration Number: INM000010122

Bankers to our Company

State Bank of India Dhanlaxmi Bank Limited

SME Branch Dhanlaxmi Buildings, Shanmugham Road Branch
Joy’s Building, 1 Floor, Padma Junction Marine Drive
Ernakulam Kochi, Kerala 682 031
Telephone: 0484 - 2355133 Telephone: 0484-2375259
Email: sbi.05387@[Link] Email: [Link]@[Link]
Website: [Link] Website: [Link]
Contact Person: Georgekutty N J Contact Person: John Jose K, Branch Head

The South Indian Bank Limited IndusInd Bank

The South Indian Bank Limited, First Floor, Gowrinarayan
Shema building (Opposite to New Jayalakshmi Skills)
M.G. Road Branch, Ravipuram 40/8399, 8400, MG Road
Ernakulam 682 016 Kochi 682 035
Telephone: 0484 2356662 Telephone: 0484-4216247
Email: br0025@[Link] Email: [Link]@[Link]
Website: [Link] Website: [Link]
Contact Person: Smt. Mary Sunitha Jose Contact Person: Soby Abraham

HDFC Bank Limited Union Bank of India

Lodha, I Think Techno Campus (a Govt. of India Undertaking)
0-3 Level, Next to Kanjurmarg Railway Station “Ajay Vihar’. M.G. Road
Kanjurmarg (East), Mumbai 400 042 Ernakulam 682 016
Telephone: 022 30752929/2928/2914 Telephone: 0484-2376474,2376920,237522,2376101
Email:[Link]@[Link];[Link] Email: bm0125@[Link]
@[Link];[Link]@[Link];prasanna. Website: [Link]
uchil@[Link] Contact Person: A.K. Harinarayana, Chief Manager
Website: [Link]
Contact Person: Vincent Dsouza, Siddharth Jadhav,
Prasanna Uchil

Punjab National Bank

No. 1057, Jaya Enclave, Avinashi Road
Coimbatore 641 018
Telephone: 0422 – 2240190
Email: bm1044@[Link];
Website: [Link]
Contact Person: Thangapandi K A

Designated Intermediaries

Self-Certified Syndicate Banks

The banks which are registered with SEBI under Securities and Exchange Board of India (Bankers to an Issue)
Regulations, 1994, as amended, and offer services in relation to ASBA, including blocking of an ASBA Account,
a list of which is available on [Link] or at such other website as may be prescribed by SEBI from
time to time.

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 Muthoottu Mini Financiers Limited

A list of the Designated Branches of the SCSBs, with which an Applicant, not applying through the Syndicate,
may submit the Application Forms, is available at [Link] or at such other website as may be
prescribed by SEBI from time to time.

Syndicate SCSB Branches

In relation to Applications submitted to the Designated Intermediaries, the list of branches of the SCSBs to receive
deposits of ASBA Applications from such Designated Intermediaries is provided on [Link] or at
such other website as may be prescribed by SEBI from time to time. For more information on such branches
collecting Applications from Designated Intermediaries, see the above-mentioned web-link.

RTAs / CDPs

The list of the RTAs and CDPs, eligible to accept Applications in the Issue, including details such as postal
address, telephone number and email address, are provided on the websites of the BSE at
[Link] for RTAs and CDPs, as updated from time to time.

Broker Centres/ Designated CDP Locations/ Designated RTA Locations

In accordance with SEBI Circular No. CIR/CFD/14/2012 dated October 4, 2012 and
CIR/CFD/POLICYCELL/11/2015 dated November 10, 2015, Applicants can submit the Application Forms with
the registered brokers at the Broker Centers, CDPs at the Designated CDP Locations or the RTAs at the Designated
RTA Locations, respective lists of which, including details such as address and telephone number, are available
at the website of the Stock Exchange at [Link]. The list of branches of the SCSBs at the Broker
Centres, named by the respective SCSBs to receive deposits of the Application Forms from the registered brokers
will be available on the website of the SEBI ([Link]) and updated from time to time.

Arrangers to the Issue

There are no arrangers to the Issue.

Minimum Subscription

In terms of the Debt Regulations, for an issuer undertaking a public issue of debt securities, the minimum
subscription for public issue of debt securities shall be 75% of the Base Issue. If our Company does not receive
the minimum subscription of 75% of the Base Issue i.e. `7,500 lakhs within the prescribed timelines under
Companies Act and any rules thereto, the entire subscription amount blocked shall be unblocked to the Applicants
within six Working Days from the date of closure of the Issue, provided wherein, the Application Amount has
been transferred to the Public Issue Account from the respective ASBA Accounts, such Application Amount shall
be refunded from the Refund Account to the relevant ASBA Accounts(s) of the Applicants within six Working
Days from the Issue Closing Date, failing which the Company will become liable to refund the Application
Amount along with interest at the rate 15 (fifteen) percent per annum for the delayed period.

Credit Rating and Rationale

Our Company has received rating of ‘IND BBB’: Outlook Stable’ by India Ratings vide its letter dated August
14, 2020 for the NCDs for an amount up to `40,000 lakhs including NCDs proposed to be issued pursuant to this
Issue. The rating of the NCDs by India Ratings indicate that instruments with this rating are considered to have
moderate degree of safety regarding timely servicing of financial obligations. Such instruments carry moderate
credit risk. The rating provided by India Ratings may be suspended, withdrawn or revised at any time by the
assigning rating agency and should be evaluated independently of any other rating. The rating is not a
recommendation to buy, sell or hold securities. For the rationale for the rating, see “Annexure II” of this
Prospectus.

Consents

Consents in writing of Directors of our Company, Company Secretary and Compliance Officer, Chief Financial
Officer, Statutory Auditors, legal advisor to the Issue, Lead Manager, the Registrar to the Issue, Credit Rating
Agency, the Bankers to our Company, Public Issue Account Bank, Refund Bank, Syndicate Member, the

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 Muthoottu Mini Financiers Limited

Debenture Trustee, IRR, the lenders to the Company to act in their respective capacities, have been obtained and
will be filed along with a copy of this Prospectus with the RoC as required under Section 26 of the Companies
Act, 2013. Further such consents have not been withdrawn up to the time of delivery of this Prospectus with the
RoC.

Underwriting

This Issue is not underwritten.

Utilisation of Issue proceeds

For details on utilization of Issue proceeds, please refer to “Objects of the Issue” on page 61.

Issue Programme

ISSUE OPENS ON September 9, 2020

ISSUE CLOSES ON October 6, 2020*

* The Issue shall remain open for subscription on Working Days from 10:00 a.m. to 5:00 p.m. (Indian Standard
Time), during the period indicated above, except that the Issue may close on such earlier date or extended date
(subject to a period of maximum 30 days from the date of Prospectus) as may be decided by the Board of Directors
of our Company (“Board”) or the Debenture Committee. In the event of such an early closure of or extension
subscription list of the Issue, our Company shall ensure that notice of such early closure or extension is given to
the prospective investors through an advertisement in a national daily newspaper with wide circulation on or
before such earlier date or extended date of closure. Applications Forms for the Issue will be accepted only from
10:00 a.m. to 5:00 p.m. (Indian Standard Time) or such extended time as may be permitted by BSE, on Working Days
during the Issue Period. On the Issue Closing Date, Application Forms will be accepted only between 10:00 a.m.
to 3:00 p.m. and uploaded until 5:00 p.m. (Indian Standard Time) or such extended time as may be permitted by
BSE.

Further please note that Application shall be accepted only between 10.00 a.m. and 5.00 p.m. (Indian Standard
Time) during the Issue Period as mentioned above by the (a) by the Designated Intermediaries at the Collection
Centres, or (b) by the SCSBs directly at the Designated Branches of the SCSBs as mentioned on the Application
Form, except that on the Issue Closing Date when Applications shall be accepted only between 10.00 a.m. and
3.00 p.m. (IST) and shall be uploaded until 5.00 p.m. (IST) or such extended time as permitted by Stock Exchange.
It is clarified that the Applications not uploaded in the Stock Exchange platform would be rejected.

Due to limitation of time available for uploading the Applications on the Issue Closing Date, the Applicants are
advised to submit their Applications one day prior to the Issue Closing Date and, in any case, no later than 3.00
p.m. (IST) on the Issue Closing Date. All times mentioned in this Prospectus are Indian Standard Time. Applicants
are cautioned that in the event a large number of Applications are received on the Issue Closing Date, as is
typically experienced in public offerings, some Applications may not get uploaded due to lack of sufficient time.

Such Applications that cannot be uploaded will not be considered for allocation under the Issue. Applications will
be accepted only on Working Days. Neither our Company, nor the Lead Manager, nor any Member of the
Syndicate, registered brokers at the Broker Centres, CDPs at the Designated CDP Locations or the RTAs at the
Designated RTA Locations or Designated Branches of SCSBs are liable for any failure in uploading the
Applications due to faults in any software/hardware system or otherwise. Please note that, within each category
of Investors, the Basis of Allotment under the Issue will be on date priority basis except on the day of
oversubscription, if any, where the Allotment will be proportionate.

43
 Muthoottu Mini Financiers Limited

CAPITAL STRUCTURE

1. Details of share capital and securities premium account

The following table lays down the details of our authorised, issued, subscribed, paid up share capital and securities
premium account as on the date of this Prospectus:

Aggregate value (except for

Particulars
securities premium) (in `)
Authorised share capital
3,25,00,000 Equity Shares of `100 each 3,25,00,00,000
Issued, subscribed and paid-up share capital
2,49,52,539 Equity Shares of `100 each 2,49,52,53,900
Securities premium account
Prior to the Issue 78,44,15,035
After to the Issue 78,44,15,035

This Issue will not result in any change of paid up share capital and the securities premium account of the
Company.

2. Issue size
Public issue by our Company of NCDs aggregating up to `10,000 lakhs, with an option to retain over-subscription
up to `10,000 lakhs, aggregating up to `20,000 lakhs, on the terms and in the manner set forth herein, in the terms
and in the manner set forth herein.

3. Details of change in the authorised share capital of our Company, as on the date of this Prospectus, for
the last five years is set out below:

Authorised share capital

Date of change Particulars
(in `)
June 6, 2017 3,25,00,00,000 Authorised share capital was increased from `2,25,00,00,000 divided into
(EGM) 2,25,00,000 Equity Shares of `100 each to `3,25,00,00,000 divided into
3,25,00,000 Equity Shares of `100 each

4. Equity Share capital history of our Company, as on the date of this Prospectus, for the last five years
is set out below:
Issue
Face
No. of price Nature Cumulative Cumulative
value per Cumulative
Date of Equity per of Nature of Equity Share Equity Share
Equity no. of Equity
allotment Shares Equity conside allotment capital premium
Share Shares
allotted Share ration (in `) (in `)
(in `)
(in `)
September 29, 12,40,418 100 165 Cash Preferential 2,37,40,418 2,37,40,41,800 70,56,27,170
2017 allotment(1)
November 1, 12,12,121 100 165 Cash Preferential 2,49,52,539 2,49,52,53,900 78,44,15,035
2017 allotment(2)
Total 2,49,52,539 2,49,52,53,900 78,44,15,035
1 Allotment of 11,01,818 Equity Shares to Mathew Muthoottu and 1,38,600 Equity Shares to Muthoottu Mini Hotels Private
Limited.
2 Allotment of 12,12,121 Equity Shares to Muthoottu Mini Theatres Private Limited.

5. Our Company has not issued any Equity Shares for consideration other than cash in the last two years
preceding the date of this Prospectus.
6. Except as disclosed above, our Company has not issued any Equity Shares in the last two years immediately
preceding the date of this Prospectus.

44
 Muthoottu Mini Financiers Limited

7. Shareholding pattern of our Company

The following table sets forth the shareholding pattern of our Company as on June 30, 2020:

Shareholdi Number of
Number of
Number of voting rights held in each ng as a % shares pledged
locked in
class of securities assuming or otherwise
shares
(IX) full encumbered
(XII)
Shareholding No. of conversion (XIII)
No. of No. of as a % of No of voting rights shares of
Number of
No. of fully partly shares Total nos. total no. of underlying convertible
Category of Number of Equity Shares
paid up paid-up underlyin shares held shares outstanding securities
Category Shareholder Shareholder held in
Equity Equity g (VII) = (calculated as convertible (as a
(I) (II) s As a % As a % of dematerialise
Shares held Shares depository (IV)+(V)+ per SCRR) securities percentage
(III) of total total d form
(IV) held receipts (VI) (VIII) (including of diluted No. No.
Class - Total as a % warrants) shares shares (XIV)
(V) (VI) As a % of Total share (a) (a)
Equity of (A+B+C) held held
(A+B+C2) (X) capital)
(b) (b)
(XI)=
(VII)+(X)
As a % of
(A+B+C2)
(A) Promoter and 7 2,49,52,534 - - 2,49,52,534 99.99 2,49,52,534 2,49,52,534 99.99 - - - - - - 2,37,34,699
Promoter
Group
(B) Public 5 5 - - 5 Negligible 5 5 Negligible - - - - - - 5
(C) Non- - - - - - - - - - - - - - -
Promoter
Non-Public
(C) (1) Shares - - - - - - - - - - - - - -
underlying
DRs
(C) (2) Shares held - - - - - - - - - - - - - -
by Employee
Trusts
Total 12 2,49,52,539 - - 2,49,52,539 100 2,49,52,539 2,49,52,539 100 - - - - 2,37,34,704
(A)+(B)+(C)

45
 Muthoottu Mini Financiers Limited

8. List of top ten holders of Equity Shares of our Company as on June 30, 2020 are as follows:

Total shareholding as a
Number of Equity Shares
No. Name of the Shareholder percent of total number of
held
Equity Shares (in %)
1. Mathew Muthoottu 1,47,79,912 59.23
2. Nizzy Mathew 33,54,446 13.44
3. Muthoottu Mini Hotels Private Limited 25,51,298 10.22
4. Mini Muthoottu Credit India Private Limited 14,19,841 5.69
5. Muthoottu Mini Theatres Private Limited 12,17,835 4.88
6. Roy M. Mathew 9,99,995 4.01
7. RMM Properties India Private Limited 6,29,207 2.52
8. Thomas Kutty 1 Negligible
8. Samuel Kutty K V 1 Negligible
8. Raju Thomas 1 Negligible
8. Ivan Mathew 1 Negligible
8. C K Varghese 1 Negligible
Total 2,49,52,539 100

9. List of top ten debentures holders of our Company as on June 30, 2020 are as follows:

(a) Secured privately placed debentures

Face value per Number of Outstanding

No. Name of holders
debenture (in `) instruments held amount (in `)
1 Rudrappa Virupaksha 1,00,000 45 45,00,000
2 Mertily Clarence Cruz 1,000 3,200 32,00,000
Valsa Rajan 1,00,000 30 30,00,000
Raghavan Krishnan Nair and 1,00,000 30 30,00,000
3 Asha Kartha
Rajappa Raja Assuntha 1,00,000 30 30,00,000
M P Shantha 1,00,000 30 30,00,000
4 Arun P 1,00,000 29 29,00,000
Sony Baby 5,00,000 5 25,00,000
M.J Kuriakose and John 5,00,000 5 25,00,000
[Link]
Raghavan Krishnan Nair and 1,00,000 25 25,00,000
Asha Kartha
Raghavan Krishnan Nair and 1,00,000 25 25,00,000
Asha Kartha
Patricia Joe Curian 1,00,000 25 25,00,000
5 Shobhit Tandon 5,00,000 5 25,00,000
Meera Abraham 1,00,000 25 25,00,000
Jacob Manasseh Thomas and 5,00,000 5 25,00,000
Shomreena Rachel Manasseh
Thomas
Shubhi Tandon 5,00,000 5 25,00,000
B Shivananda Aradhya 1,00,000 25 25,00,000
Mala Govind 1,000 2,500 25,00,000
6 M M Mathew 1,00,000 2,400 24,00,000
Elizabeth Jacob 1,000 2,000 20,00,000
Thankamony Eapen 1,000 2,000 2,000,000
7
Bindhu M S 1,000 2,000 2,000,000
Elizabeth Jacob 1,000 2,000 2,000,000

46
 Muthoottu Mini Financiers Limited

Face value per Number of Outstanding

No. Name of holders
debenture (in `) instruments held amount (in `)
Refolda Gomes A 1,000 2,000 20,00,000
Thomas A.V. 1,00,000 20 2,000,000
Sathyavan N 1,00,000 20 2,000,000
Thomas A.V. 1,00,000 20 2,000,000
Thangamma Samuel 1,00,000 18 1,800,000
8
Sheno K S 1,000 1,800 18,00,000.00
Wilson Gomez and Gladis J 1,00,000 17 1,700,000
9 David
Samuel E V 1,00,000 17 1,700,000
Jacob T Abraham 1,000 1,500 15,00,000
K T Harilal 1,000 1,500 15,00,000
Neethu L 1,000 1,500 15,00,000
N A Mathai 1,00,000 15 15,00,000
Thomas Abraham and Saramma 1,00,000 15 15,00,000
Thomas
M L Veetus and Tony Veetus 1,00,000 15 15,00,000
Sasikumari S 1,000 1,500 15,00,000
Subramanian. P P 1,00,000 15 15,00,000
10
Prabhu V.M S/O 1,00,000 15 15,00,000
Muthumanickam
Bhagyam T A 1,00,000 15 15,00,000
Renu John 1,00,000 15 15,00,000
B Shivananda Aradhya 1,00,000 15 15,00,000
Mariam Chandy 1,00,000 15 15,00,000
Sunny Kunju Kunju Puthan 1,000 1,500 15,00,000
Kandathil
Thushara Sreedharan 1,00,000 15 15,00,000

(b) Unsecured privately placed debentures

No. Name of holders Face value per Number Outstanding

debenture (in `) of instruments held amount (in `)
1 Anu Cashews 1,00,000 200 2,00,00,000
2 Vasantha K 1,00,000 181 1,81,00,000
3 Tresa Rose 5,00,000 21 1,05,00,000
Tresa Rose 5,00,000 21 1,05,00,000
4 Vidyadevi Sreenath 5,00,000 20 1,00,00,000
Sreenath Gopalakrishnan 5,00,000 20 1,00,00,000
5 Lakshmi Gayathri R and J 5,00,000 11 55,00,000
Nagaraja Kumari
5 Araadhana Sangeeth 1,000 100 1,00,000
represented by father and
Gaurdian Sangeeth
Azari 1,000 100 1,00,000
6 Latheefa Beevi 1,000 50 50,000
Sunitha Ganesh M 1,000 50 50,000
7 Govindarajan R 1,000 25 25,000
Mr Kunjumon C 1,000 25 25,000
[Link].P.K 1,000 25 25,000

47
 Muthoottu Mini Financiers Limited

(c) Secured debentures issued vide Public Issues

Face value per Outstanding

Number of instruments
No. Name of holders debenture amount
held
(in ``) (in ``)
1 Varun Narayan K Pillai 12,085 1,000 12,085,000
2 Monetary Kuries Private Ltd 10,000 1,000 10,000,000
3 K Thomas Babu 7,500 1,000 7,500,000
Silvy Simon. 7,000 1,000 70,00,000
4
Ajo Mathew 7,000 1,000 70,00,000
5 Raghavan 6,500 1,000 65,00,000
6 Jayakumar P G 5,500 1,000 55,00,000
7 Kuttappan Thomas 5,100 1,000 51,00,000
Rohit Chandra 5,000 1,000 50,00,000
Trinadha Subramanyam Gupta
8 Kolluru 5,000 1,000 50,00,000
M T Mathew 5,000 1,000 50,00,000
Shiju S 5,000 1,000 50,00,000
9 Rosamma Philip 4,900 1,000 49,00,000
10 Manu Devadasan 4,650 1,000 46,50,000

(d) Unsecured debentures issued vide Public Issues

Face value per

Number of Outstanding amount
No. Name of holders debenture
instruments held (in `)
(in `)
1 Nandakumar P D. 7,000 1,000 70,00,000
2 G Lekshmi Pillai 5,000 1,000 50,00,000
Mita Suresh 5,000 1,000 50,00,000
Nita Suresh 5,000 1,000 50,00,000
3 Elangattu Sukumaran 3,766 1,000 37,66,000
4 Mariamma Roy Manaloor 3,600 1,000 36,00,000
5 Mathew Ettolil Joseph 3,530 1,000 35,30,000
6 Rosamma Philip 3,350 1,000 33,50,000
7 Jessi Mathews 3,000 1,000 30,00,000
G Soman 3,000 1,000 30,00,000
8 George Philip K 2,750 1,000 27,50,000
9 Jobby Abraham Titus 2,500 1,000 25,00,000
Curiaq Joseph 2,500 1,000 25,00,000
P V Abraham 2,500 1,000 25,00,000
Mayalekshmi V N 2,500 1,000 25,00,000
Subramanian P. 2,500 1,000 25,00,000
Sureshkumar D. 2,500 1,000 25,00,000
Mohanan B. 2,500 1,000 25,00,000
Bhagyam T A. 2,500 1,000 25,00,000
10 George T Jose 2,200 1,000 22,00,000

(e) Subordinated debt as on June 30, 2020

Face value per

Number of instruments Outstanding amount
No. Name of holders debenture
held (in `)
(in `)
1. M C Mammen 10,000.00 1,000.00 1,00,00,000.00

48
 Muthoottu Mini Financiers Limited

Face value per

Number of instruments Outstanding amount
No. Name of holders debenture
held (in `)
(in `)
2. Ravi Kumar Rajashekaran 7,000.00 1,000.00 70,00,000.00
3. Mini Vasudevan 6,000.00 1,000.00 60,00,000.00
4. Vinod Vikraman Nair 5,300.00 1,000.00 53,00,000.00
5. Manjula Tony 4,000.00 1,000.00 40,00,000.00
6. Krishnan Nair 3,500.00 1,000.00 35,00,000.00
Vinod Vikraman Nair 3,500.00 1,000.00 35,00,000.00
7. Rossmilon Daniel R.S 3,025.00 1,000.00 30,25,000.00
8. Vinod Vikraman Nair 3,000.00 1,000.00 30,00,000.00
Mary Thampi W/O Late 3,000.00 1,000.00 30,00,000.00
[Link]
Soman G 3,000.00 1,000.00 30,00,000.00
Shakuntala Acharya 3,000.00 1,000.00 30,00,000.00
9. K G Kamalakashi Amma & K R 2,800.00 1,000.00 28,00,000.00
Girija Kumari
Thomas Varghese 2,800.00 1,000.00 28,00,000.00
10. Saji John And Annamma 2,600.00 1,000.00 26,00,000.00
Kulaparampil

10. Details of holding Equity Shares by our Promoters as on the date of this Prospectus is set out below:

Total percentage of
Total shareholding as
Number of Equity Shares pledged
a percent of total No. of Equity
No. Name of the Promoter Equity Shares with respect to total
number of Equity Shares pledged
held number of Equity Shares
Shares (in %)
held (in %)
1. Mathew Muthoottu 14,77,99,12 59.23 Nil Nil
2. Nizzy Mathew 33,54,446 13.44 Nil Nil
Total 1,81,34,358 72.67 Nil Nil

11. Details of holding of Equity Shares by our Directors as on the date of this Prospectus
For details of shareholding of our Directors in the Company, please refer to “Our Management- Shareholding of
our Directors” on page 112.

12. Debt - equity ratio

The debt-equity ratio of our Company, prior to this Issue is based on a total outstanding debt of `1,52,824.63
lakhs and Shareholder funds amounting to `47,810.32 lakhs as of March 31, 2020:

(in ` lakhs)
As on March 31, 2020
Particulars
Pre- Issue* Post- Issue
Debt
Debt Securities 1,16,280.78 1,36,280.78
Borrowings (other than Debt Securities) 36,543.85 36,543.85
Total Debts 1,52,824.63 1,72,824.63

Equity
Equity Share Capital 24,952.54 24,952.54
Other Equity
Special Reserve Fund 4,740.07 4,740.07
Securities Premium 7,844.15 7,844.15
Debenture Redemption Reserve - -
Retained Earnings 10,273.56 10,273.56
Total Equity 47,810.32 47,810.32

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 Muthoottu Mini Financiers Limited

As on March 31, 2020

Particulars
Pre- Issue* Post- Issue
Debt/Equity 3.20 3.61
*As per Indian Accounting Standards (IND AS) notified under section 133 of the Companies Act, 2013 read with relevant rules
issued thereunder.
#The debt-equity ratio post the Issue is indicative and is on account of inflow of ` 20,000 Lakhs from the Issue and does not
include contingent and off-balance sheet liabilities. The actual debt-equity ratio post the Issue would depend upon the actual
position of debt and equity on the date of allotment.

Notes:

1. Debt Securities includes interest accrued but not due thereon but excluding unamortized expense of public issues.
2. The figures disclosed above are based on the Audited Financial Statements of the Company as at March 31, 2020.
3. Debt / Equity = Total Debt / Equity.
4. The debt-equity ratio post the Issue is indicative and is on account of inflow of ` 20,000 lakhs from the proposed public
issue and does not include contingent and off-balance sheet liabilities. The actual debt-equity ratio post the Issue would
depend upon the actual position of debt and equity on the date of allotment.
5. The Company has raised secured non-convertible debenture amounting to ` 19,790.67 Lakhs through public issue during
April 1, 2020 - July 31, 2020 impact of which is not provided in the above table.
6. The Company has raised funds through Subordinated Debt amounting to ` 2,772.88 Lakhs during April 1, 2020 - July
31, 2020 impact of which is not provided in the above table.
7. The Company during April 1, 2020 – July 31, 2020 redeemed secured privately placed non-convertible debenture
amounting to ` 120.00 lakhs and unsecured privately place non-convertible debenture amounting to ` 245.00 lakhs impact
of which is not provided in the above table.
8. The Company during April 1, 2020 – July 31, 2020 has redeemed unsecured public issue of non-convertible debenture
amounting to ` 7,143.37 lakhs impact of which is not provided in the above table.
9. Other Equity does not include revaluation reserve.
10. Debt Securities does not include unclaimed matured debentures and interest thereon amounting to ` 353.57 Lakhs.

13. None of the members of the Promoter group, our Promoters, our Directors and their immediate relatives have
sold or purchased the Equity Shares of our Company within six months preceding the date of filing this
Prospectus with the RoC.

14. For details on the total outstanding debt of our Company, please refer to “Financial Indebtedness” on page
126.

15. Our Company has not made any acquisition or amalgamation in the last one year prior to the date of this
Prospectus.

16. Our Company has not made any reorganization/reconstruction in the last one year prior to the date of this
Prospectus.

17. Our Company does not have any outstanding borrowings taken/debt securities issued where taken/issued (i)
for consideration other than cash, whether in whole or part, (ii) at a premium or discount, or (iii) in pursuance
of an option.

18. None of the Equity Shares held by the Promoters are pledged or encumbered otherwise.

19. As on the date of this Prospectus, 2,37,34,704 Equity Shares of our Company are in dematerialised form.

20. Our Company does not have any employee stock option scheme.

50
 Muthoottu Mini Financiers Limited

STATEMENT OF TAX BENEFITS AVAILABLE TO THE DEBENTURE HOLDERS

To,
The Board of Directors
Muthoottu Mini Financiers Limited
Muthoottu Buildings,
Kozhencherry,
Pathanamthitta – 689 641,
Kerala, India

Dear Sir,

Sub: Statement of possible tax benefits available to Debenture Holders of Muthoottu Mini Financiers
Limited in connection with the proposed public issue of redeemable secured non-convertible
debentures of face value of Rs. 1,000/- each (the “Debentures” or the “NCDS”) (hereinafter referred
to as the “Issue”)

We refer to the proposed Issue by Muthoottu Mini Financiers Limited (the “Company”) and enclose the
Statement of possible tax benefits available to the debenture holders under the Income-tax Act, 1961 (the
“Statement”) showing the current position of taxation applicable to the debenture holders as per the provisions
of the Income-tax Act, 1961 (the “Act”) and Income tax Rules, 1962 including amendments made by Finance Act
2020 as applicable for the financial year 2020-21, for inclusion in the Draft Prospectus and Prospectus (the “Offer
Documents”) which is proposed by the Company to be issued in connection with the Issue. Several of these
benefits are dependent on the debenture holders fulfilling the conditions prescribed under the relevant provisions
of the Act. Hence the ability of the debenture holders to derive these direct tax benefits is dependent upon their
fulfilling such conditions.

We are informed that the debentures of the Company will be listed on recognised stock exchanges in India. The
Annexure has been prepared on that basis.

The benefits discussed in the enclosed statement are neither exhaustive nor conclusive. The contents stated in the
Statement are based on the information and explanations obtained from the Company. This statement is only
intended to provide general information to the debenture holders and is neither designed nor intended to be a
substitute for professional tax advice. In view of the individual nature of the tax consequences and the changing
tax laws, each debenture holder is advised to consult their own tax consultant with respect to the specific tax
implications arising out of their participation in the Issue. We are neither suggesting nor are we advising the
debenture holders to invest money based on this statement.

We accept no responsibility to debenture holders or any third party and this should be stated in the Offer
Documents. The contents of the enclosed statement are based on the representations obtained from the Company
and on the basis of our understanding of the business activities and operations of the Company.

We do not express any opinion or provide any assurance as to whether:

• the debenture holders will continue to obtain these benefits in similar manner in future;
• the conditions prescribed for availing the benefits have been / would be met with; and
• the revenue authorities/courts will concur with the views expressed herein.

This statement is provided solely for the purpose of assisting the Company in discharging its responsibilities under
the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008, as amended.

We hereby give our consent to include enclosed statement regarding the tax benefits available to the Company
and to its debenture holders in the Offer Document for the Issue which the Company intends to file to the BSE
Limited, the Securities and Exchange Board of India, the relevant Registrar of Companies in India and any other
regulatory authorities as required under the applicable laws, in connection with the Issue provided that the below
statement of limitation is included in the Offer Documents.

51
 Muthoottu Mini Financiers Limited

Limitations

Our views expressed in the Statement enclosed are based on the facts and assumptions indicated above. No
assurance is given that the revenue authorities/courts will concur with the views expressed herein. Our views are
based on the existing provisions of law and its reasonable interpretation, which are subject to change from time
to time. We do not assume responsibility to update the views consequent to such changes.

This Statement is addressed to you solely for the use of the Company in relation to the Issue and, except with our
prior written consent, is not to be transmitted or disclosed to or used or relied upon by any other person or used
or relied upon by you for any other purpose.

Yours Faithfully,

For Vishnu Rajendran& Co

Chartered Accountants
Firm Registration Number: 004741S
Peer Review Number: 011622
UDIN: 20201101AAAADF9701

P.A. Joseph, FCA

Partner
Membership No: 201101

Date : August 14, 2020

Place : Kottayam

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 Muthoottu Mini Financiers Limited

ANNEXURE

STATEMENT OF POSSIBLE DIRECT TAX BENEFITS AVAILABLE TO THE DEBENTURE

HOLDERS

Under the Income-tax Act, 1961 (“I.T. Act”)

A. Tax benefits available to the Resident Debenture Holders

1. Interest on debentures received by resident debenture holders would be subject to tax at the normal rates of
tax in accordance with and subject to the provisions of the I.T. Act. Income tax is deductible at source at the
rate of 10%1 on interest on debentures, payable to resident debenture holders at the time of credit/ payment
as per the provisions of Section 193 of the I.T. Act. However, no income tax is deductible at source in the
following situations:

(a) On any security issued by a company in a dematerialized form and is listed on recognized stock exchange
in India in accordance with the Securities Contracts (Regulation) Act, 1956 and the rules made there
under.

(b) In case the payment of interest on debentures to a resident individual or a Hindu Undivided Family
(‘HUF’), does not or is not likely to exceed ` 5,000 in the aggregate during the Financial Year and the
interest is paid by an account payee cheque.

(c) When the Assessing Officer issues a certificate on an application by a Debenture Holder on satisfaction
that the total income of the Debenture Holder justifies no/lower deduction of tax at source as per the
provisions of Section 197(1) of the I.T. Act; and that certificate is filed with the Company before the
prescribed date of closure of books for payment of debenture interest.

(d) (i) When the resident Debenture Holder with Permanent Account Number (‘PAN’) (not being
accompany or a firm) submits a declaration as per the provisions of section 197A(1A) of the I.T.
Act in the prescribed Form 15G verified in the prescribed manner to the effect that the tax on his
estimated total income of the financial year in which such income is to be included in computing his
total income will be NIL. However under section 197A(1B) of the I.T. Act, Form 15G cannot be
submitted nor considered for exemption from tax deduction at source if the amount of any income
of the nature referred to in section 197A(1) or 197A(1A), as the case may be, or the aggregate of the
amounts of such incomes credited or paid or likely to be credited or paid during the previous year in
which such income is to be included exceeds the maximum amount which is not chargeable to
income-tax. To illustrate, as on 01.04.2020

‒ the maximum amount of income not chargeable to tax in case of individuals (other than senior
citizens and super senior citizens) and HUFs is ` 2,50,000;
‒ in the case of every individual being a resident in India, who is of the age of 60 years or more
but less than 80 years at any time during the Financial year (Senior Citizen) is ` 3,00,000; and
‒ in the case of every individual being a resident in India, who is of the age of 80 years or more
at any time during the Financial year (Super Senior Citizen) is ` 5,00,000. Further, section 87A
provides a rebate of 100 percent of income-tax or an amount of ` 12,500 whichever is less to a
resident individual whose total income does not exceed ` 5,00,000.

(ii) Senior citizens, who are 60 or more years of age at any time during the financial year, enjoy the
special privilege to submit a self-declaration in the prescribed Form 15H for non deduction of tax at
source in accordance with the provisions of section 197A(1C) of the I.T. Act even if the aggregate
income credited or paid or likely to be credited or paid exceeds the maximum amount not chargeable
to tax, provided that the tax due on total income of the person is NIL.

1
The Ministry of Finance vide its press release dated 13th May, 2020 had announced a reduced rate for deduction
of tax at source. Accordingly, the TDS rate under Section 193 of Income Act is reduced to 7.5% for the period
from 14th May, 2020 to 31st March, 2021.

53
 Muthoottu Mini Financiers Limited

(iii) In all other situations, tax would be deducted at source as per prevailing provisions of the I.T. Act.
Form No.15G with PAN / Form No.15H with PAN / Certificate issued u/s 197(1) has to be filed
with the Company before the prescribed date of closure of books for payment of debenture interest
without any tax withholding.

2. The rate at which tax shall be deducted at source while paying interest to a resident debenture-holder shall
not be increased by surcharge and health and education cess (‘cess’).

3. Capital gains and other provisions

(a) As per section 2(29A) read with section 2(42A) of the I.T. Act, a listed debenture is treated as a long
term capital asset if the same is held for more than 12 months immediately preceding the date of its
transfer. In all other cases such as unlisted Debentures, it is 36 months immediately preceding the date
of its transfer.

(b) As per section 112 of the I.T. Act, capital gains arising on the transfer of long-term capital assets being
listed Debentures are subject to tax at the rate of 10% [plus applicable surcharge and Health and
Education Cess (“cess”)] of capital gains calculated without indexation of the cost of acquisition. The
capital gains shall be computed by deducting expenditure incurred in connection with such transfer and
cost of acquisition of the Debentures from the sale consideration.

(c) In case of an individual or HUF, being a resident, where the total income as reduced by such long –term
capital gains is below the maximum amount which is not chargeable to income-tax, then, such long term
capital gains shall be reduced by the amount by which the total income as so reduced falls short of the
maximum amount which is not chargeable to income-tax and the tax on the balance of such long-term
capital gains shall be computed at the rate mentioned above.

(d) As per section 2(42A) of the I.T. Act, a listed debenture is treated as a short term capital asset if the same
is held for not more than 12 months immediately preceding the date of its transfer. Short-term capital
gains on the transfer of listed debentures, where debentures are held for a period of not more than 12
months would be taxed at the normal rates of tax in accordance with and subject to the provisions of the
I.T. Act. The provisions relating to maximum amount not chargeable to tax described at Para c above
would also apply to such short term capital gains.

(e) Surcharge and Health and education cess

• Surcharge is levied on individuals, HUF, association of persons, body of individuals and artificial
juridical person –

(i) at the rate of 10% on tax where total income (including the income by way of dividend or income
under the provisions of section 111A and section 112A of the I.T. Act) exceeds Rs.50,00,000
but does not exceed Rs. 1,00,00,000;

(ii) at the rate of 15% on tax where the total income (including the income by way of dividend or
income under the provisions of section 111A and section 112A of the I.T. Act) exceeds Rs.
1,00,00,000 but does not exceed Rs. 2,00,00,000;

(iii) at the rate of 25% of tax where the total income (excluding the income by way of dividend or
income under the provisions of section 111A and section 112A of the Income-tax Act) exceeds
Rs. 2,00,00,000 but does not exceed Rs. 5,00,00,000;

(iv) at the rate of 37% of tax where the total income (excluding the income by way of dividend or
income under the provisions of section 111A and section 112A of the Income-tax Act) exceeds
Rs. 5,00,00,000; and

(v) at the rate of 15% of tax where the total income (including the income by way of dividend or
income under the provisions of section 111A and section 112A) exceeds `2,00,00,000 but is not
covered under (iii) and (iv) above.

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 Muthoottu Mini Financiers Limited

• Surcharge is levied on firm, co-operative society and local authority at the rate of 12% on tax where
the total income exceeds Rs. 1,00,00,000.

• Surcharge is levied on domestic companies (other than companies availing benefit under section
115BAA and section 115BAB of the I.T. Act) at the rate of 7% on tax where the income exceeds
Rs. 1,00,00,000 but does not exceed Rs. 10,00,00,000 and at the rate of 12% on tax where the income
exceeds Rs. 10,00,00,000.

• Surcharge is levied on domestic companies availing benefit under section 115BAA and section
115BAB of the I.T. Act at the rate of 10%.

• Surcharge is levied on every company other than domestic company at the rate of 2% on tax where
the income exceeds Rs. 1,00,00,000 but does not exceed Rs. 10,00,00,000 and at the rate of 5% on
tax where the income exceeds Rs. 10,00,00,000.

• Health and Education Cess is to be applied at 4% on aggregate of base tax and surcharge.

(f) As per Section 74 of the I.T. Act, short-term capital loss on debentures suffered during the year is allowed
to be set-off against short-term as well as long-term capital gains of the said year. Balance loss, if any
could be carried forward for eight years for claiming set-off against subsequent years’ short-term as well
as long term capital gains. Long-term capital loss on debentures suffered during the year is allowed to be
set-off only against long-term capital gains. Balance loss, if any, could be carried forward for eight years
for claiming set-off against subsequent year’s long-term capital gains.

(g) In case debentures are held as stock in trade, the income on transfer of debentures would be taxed as
business income or loss in accordance with and subject to the provisions of the I.T. Act. Further, where
the debentures are sold by the Debenture Holder(s) before maturity, the gains arising therefrom are
generally treated as capital gains or business income as the case may be depending whether the same is
held as Stock in trade or investment. However, there is an exposure that the Indian Revenue Authorities
(especially at lower level) may seek to challenge the said characterization and hold such gains/income as
interest income in the hands of such Debenture Holder(s). Further, cumulative or regular returns on
debentures held till maturity would generally be taxable as interest income taxable under the head Income
from other sources where debentures are held as investments or business income where debentures are
held as trading asset / stock in trade.

(h) Interest on application money and interest on refund application would be subject to tax at the normal
rates of tax in accordance with and subject to the provisions of the I.T. Act and such tax would need to
be withheld at the time of credit/payment as per the provisions of Section 194A of the I.T. Act

B. Tax benefits available to the Non-Resident Debenture Holders

1. A non-resident Indian has an option to be governed by Chapter XII -A of the I.T. Act, subject to the
provisions contained therein which are given in brief as under:

(a) As per section 115C(e) of the Act, the term “non-resident Indian” means an individual, being a citizen of
India or a person of Indian origin who is not a “resident”. A person shall be deemed to be of Indian origin
if he, or either of his parents or any of his grand-parents, was born in undivided India.

(b) As per section 115E of the I.T. Act, interest income from debentures acquired or purchased with or
subscribed to in convertible foreign exchange will be taxable at 20%, whereas, long term capital gains
on transfer of such debentures will be taxable at 10% of such capital gains without indexation of cost of
acquisition. Short-term capital gains will be taxable at the normal rates of tax in accordance with and
subject to the provisions contained therein.

(c) As per section 115F of the I.T. Act, long term capital gains arising to a non-resident Indian from transfer
of debentures acquired or purchased with or subscribed to in convertible foreign exchange will be exempt
from capital gain tax to the extent the net consideration is invested within six months after the date of
transfer of the debentures in any specified asset or in any saving certificates referred to in section10(4B)
of the I.T. Act in accordance with and subject to the provisions contained therein.

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The exemption shall be as under:

‒ Where the cost of the new asset is equal to or higher than the net consideration received from sale
of the debentures, the entire amount of capital gains shall not be chargeable to tax;

‒ Where the cost of the new asset is less than the net consideration in respect of the original asset, so
much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of
acquisition of the new asset bears to the net consideration shall not be chargeable to tax.

The abovementioned tax benefits shall be available only where the new asset is held for a minimum
period of 3 years from the date of its purchase. If the new assets are transferred or converted into money
within a period of three years from their date of acquisition, the amount of capital gains exempted earlier
would become chargeable to tax as long term capital gains in the year in which the new assets are
transferred or converted into money.

(d) As per section 115G of the I.T. Act, it shall not be necessary for a non-resident Indian to file a return of
income under section 139(1) of the I.T. Act, if his total income consists only of investment income as
defined under section 115C and/or long term capital gains earned on transfer of such investment acquired
out of convertible foreign exchange, and the tax has been deducted at source from such income under the
provisions of Chapter XVII-B of the I.T. Act in accordance with and subject to the provisions contained
therein.

(e) As per section 115H of the I.T. Act, where a non-resident Indian becomes assessable as resident in India
in any subsequent year, he may furnish to the Assessing Officer a declaration in writing along with return
of income under section 139 for the assessment year for which he is assessable as a resident, to the effect
that the provisions of Chapter XII -A shall continue to apply to him in relation to the investment income
(other than on shares in an Indian Company) derived from any foreign exchange assets in accordance
with and subject to the provisions contained therein. On doing so, the provisions of Chapter XII-A shall
continue to apply to him in relation to such income for that assessment year and for every subsequent
assessment year until the transfer or conversion (otherwise than by transfer) into money of such assets.

2. In accordance with and subject to the provisions of section 115-I of the I.T. Act, a non-resident Indian may
opt not to be governed by the provisions of Chapter XII -A of the I.T. Act. In that case,

‒ Long term capital gains on transfer of listed debentures would be subject to tax at the rate of
10%computed without indexation.

‒ Investment income and Short-term capital gains on the transfer of listed debentures, where debentures
are held for a period of not more than 12 months preceding the date of transfer, would be taxed at the
normal rates of tax in accordance with and subject to the provisions of the I.T. Act

3. Under Section 195 of the I.T. Act, the applicable rate of tax deduction at source is 20% on investment income
and 10% on any long-term capital gains as per section 115E of the I.T. Act, and at the normal rates for Short
Term Capital Gains if the payee debenture holder is a non-resident Indian. The tax rates shall be increased by
applicable surcharge and cess.

4. As per Section 74 of the I.T. Act, short-term capital loss suffered during the year is allowed to be set- off
against short-term as well as long-term capital gains of the said year. Balance loss, if any could be carried
forward for eight years for claiming set-off against subsequent years’ short-term as well as long-term capital
gains. Long term capital loss suffered during the year is allowed to be set-off only against long-term capital
gains. Balance loss, if any, could be carried forward for eight years for claiming set-off against subsequent
year’s long-term capital gains.

5. The rate at which tax is deducted shall be increased by a surcharge as under:

‒ In the case of non-resident Indian surcharge at the rate of 10% of such tax where the income or the
aggregate of such income (including the income by way of dividend or income under the provisions of
sections 111A and 112A of the Income-tax Act) paid or likely to be paid and subject to the deduction
exceeds ` 50,00,000 but not exceeding ` 1,00,00,000,

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 Muthoottu Mini Financiers Limited

‒ 15% of such tax where the income or the aggregate of such income (including the income by way of
dividend or income under the provisions of sections 111A and 112A of the Income-tax Act) paid or likely
to be paid and subject to the deduction exceeds ` 1,00,00,000 but not exceeding ` 2,00,00,000,

‒ 25 % of such tax where the income or the aggregate of such income (excluding the income by way of
dividend or income under the provisions of sections 111A and 112A of the Income-tax Act) paid or likely
to be paid and subject to the deduction exceeds ` 2,00,00,000 but not exceeding ` 5,00,00,000,

‒ 37% of such tax where the income or the aggregate of such income (excluding the income by way of
dividend or income under the provisions of sections 111A and 112A of the Income-tax Act) paid or likely
to be paid and subject to the deduction exceeds ` 5,00,00,000 and

‒ 15% of such tax where the income or the aggregate of such income (including the income by way of
dividend or income under the provisions of sections 111A and 112A of the Income-tax Act) paid or likely
to be paid and subject to the deduction exceeds ` 2,00,00,000 but is not covered under sub-clauses iii and
iv.

6. In case of foreign companies, where the income paid or likely to be paid exceeds ` 1,00,00,000 but does not
exceed ` 10,00,00,000 a surcharge of 2% of such tax liability is payable and when such income paid or likely
to be paid exceeds ` 10,00,00,000, surcharge at 5% of such tax is payable.

7. The rate at which tax is deducted shall further be increased by cess of 4%. Where surcharge is not applicable,
the rate of cess shall be added directly to the rate at which tax shall be deducted. Where surcharge is
applicable, the cess shall be added to the rate of tax arrived at after considering the surcharge rate.

8. As per section 90(2) of the I.T. Act read with the Circular no. 728 dated 30 October 1995 issued by the Central
Board of Direct Taxes, in the case of a remittance to a country with which a Double Tax Avoidance
Agreement (DTAA) is in force, the tax should be deducted at the rate provided in the Finance Act of the
relevant year or at the rate provided in the DTAA, whichever is more beneficial to the Assessee. However,
submission of tax residency certificate (“TRC”) is a mandatory condition for availing benefits under any
DTAA. If the TRC does not contain the prescribed particulars, a self - declaration in Form 10F would need
to be provided by the Assessee along with TRC.

9. Alternatively, to ensure non deduction or lower deduction of tax at source, as the case may be, the Debenture
Holder should furnish a certificate under section 195(2) & 195(3) of the I.T. Act, from the Assessing Officer
before the prescribed date of closure of books for payment of debenture interest. However, an application for
the issuance of such certificate would not be entertained in the absence of PAN as per the provisions of section
206AA.

10. Where, debentures are held as stock in trade, the income on transfer of debentures would be taxed as business
income or loss in accordance with and subject to the provisions of the I.T. Act. Further, where the debentures
are sold by the Debenture Holder(s) before maturity, the gains arising there from are generally treated as
capital gains or business income as the case may be. However, there is an exposure that the Indian Revenue
Authorities (especially at lower level) may seek to challenge the said characterization (especially considering
the provisions explained in Para V below) and hold the such gains/income as interest income in the hands of
such Debenture Holder(s). Further, cumulative or regular returns on debentures held till maturity would
generally be taxable as interest income taxable under the head Income from other sources where debentures
are held as investments or business income where debentures are held as trading asset /stock in trade.

C. Tax benefits available to the Foreign Institutional Investors (“FIIs / FPIs”)

1. As per Section 2(14) of the I.T. Act, any securities held by FIIs / FPIs which has invested in such securities
in accordance with the regulations made under the Securities and Exchange Board of India Act, 1992, shall
be treated as capital assets. Accordingly, any gains arising from transfer of such securities shall be chargeable
to tax in the hands of FIIs / FPIs as capital gains.

2. In accordance with and subject to the provisions of section 115AD of the I.T. Act, long term capital gains on
transfer of debentures by FIIs / FPIs are taxable at 10% (plus applicable surcharge and cess) and short-term
capital gains are taxable at 30% (plus applicable surcharge and cess). The benefit of cost indexation will not
be available. Further, benefit of provisions of the first proviso of section 48 of the I.T. Act will not apply.

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3. The Finance Act, 2013 (by way of insertion of a new section 194LD in the I.T. Act) provides for lower rate
of withholding tax at the rate of 5% on payment by way of interest paid by an Indian company to FIIs/FPIs
and Qualified Foreign Investor in respect of rupee denominated bond of an Indian company between June1,
2013 and July 1, 2023 provided such rate does not exceed the rate as may be notified by the Government.

4. In accordance with and subject to the provisions of section 196D(1) of the I.T. Act, the interest income
received by the FII/FPI shall be subject to withholding tax @ 20% (plus surcharge and cess). Further, as per
section 196D (2) of the I.T. Act, no tax shall be deducted at source on capital gains arising on the transfer of
debentures by FIIs/FPIs.

5. The CBDT has issued a Notification No. 9 dated 22 January 2014 which provides that Foreign Portfolio
Investors (FPI) registered under SEBI (Foreign Portfolio Investors) Regulations, 2014 shall be treated as FII
for the purpose of Section 115AD of the I.T. Act.

D. Tax benefits available to Mutual Funds

As per section 10(23D) of the Act, any income of Mutual Funds registered under the Securities and Exchange
Board of India Act, 1992 or Regulations made there under, Mutual Funds set up by public sector banks or
public financial institutions and Mutual Funds authorised by the Reserve Bank of India will be exempt from
income tax, subject to such conditions as the Central Government may, by notification in the Official
Gazette, specify in this behalf.

Further, as per the provisions of section 196 of the I.T. Act, no deduction of tax shall be made by any person
from any sums payable to mutual funds specified under Section 10(23D) of the I.T. Act, where such sum is
payable to it by way of interest or dividend in respect of any securities or shares owned by it or in which it
has full beneficial interest, or any other income accruing or arising to it.

E. General Anti-Avoidance Rule (‘GAAR’)

In terms of Chapter XA of the I.T. Act, General Anti-Avoidance Rule may be invoked notwithstanding
anything contained in the I.T. Act. By this Rule, any arrangement entered into by an assessee may be declared
to be impermissible avoidance arrangement as defined in that Chapter and the consequence would be inter-
alia denial of tax benefit. Applicable w.e.f 1-04-2017, the GAAR provisions can be said to be not applicable
in certain circumstances viz. the main purpose of arrangement is not to obtain a tax benefit etc. including
circumstances enumerated in CBDT Notification No. 68 75/2013 dated 23 September 2013.

F. Exemption under section 54E and section 54F of the I.T. Act

1. Section 54E of the I.T. Act provides that any long-term capital gains on transfer of a long term capital asset,
including debentures, (hereinafter referred to as ‘original asset’) shall be exempt from capital gain tax to the
extent the net consideration is invested, within six months after the date of transfer of the original asset, in
any specified assets such as government saving certificates, rural development bonds, etc., in accordance
with and subject to the provisions contained therein. The exemption shall be as under:

‒ Where the cost of the new asset is equal to or higher than the net consideration received from sale of
the debentures, the entire amount of capital gains shall not be chargeable to tax;

‒ Where the cost of the new asset is less than the net consideration in respect of the original asset, so
much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of
acquisition of the new asset bears to the net consideration shall not be chargeable to tax.

The abovementioned tax benefits shall be available only where the new asset is held for a minimum period
of 3 years from the date of its purchase. Where the new asset is transferred within a period of 3 years from
its date of purchase, the capital gain arising from transfer of the original asset claimed as exempt shall be
deemed to be capital gains chargeable to tax in the year in which the new asset is transfer

2. As per the provisions of section 54F of the I.T. Act, any long-term capital gains on transfer of a long term
capital asset (not being residential house) arising to a debenture holder who is an individual or Hindu
Undivided Family, is exempt from tax if the entire net sales consideration is utilised, within a period of one
year before, or two years after the date of transfer, in purchase of a new residential house, or for construction

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of residential house within three years from the date of transfer. If part of such net sales consideration is
invested within the prescribed period in a residential house, then such gains would be chargeable to tax on a
proportionate basis. This exemption is available, subject to the condition that the debenture holder does not
own more than one residential house at the time of such transfer. If the residential house in which the
investment has been made is transferred within a period of three years from the date of its purchase or
construction, the amount of capital gains tax exempted earlier would become chargeable to tax as long term
capital gains in the year in which such residential house is transferred. Similarly, if the debenture holder
purchases within a period of two years or constructs within a period of three years after the date of transfer
of capital asset, another residential house (other than the new residential house referred above), then the
original exemption will be taxed as capital gains in the year in which the additional residential house is
acquired.

G. Requirement to furnish PAN under the I.T. Act

1. Section 139A(5A) of the I.T. Act requires every person receiving any sum or income or amount from which
tax has been deducted under Chapter XVII-B of the I.T. Act to furnish his PAN to the person responsible for
deducting such tax.

2. Section 139A(6A) of the I.T. Act requires every person entering into certain transactions, as may be
prescribed, to quote his PAN or Aadhar number, in the documents pertaining to such transactions and also
authenticate such PAN or Aadhar number, in the manner prescribed.

3. Section 206AA of the I.T. Act requires every person entitled to receive any sum or income or amount, on
which tax is deductible under Chapter XVIIB (“deductee”) to furnish his PAN to the deductor, failing which
tax shall be deducted at the higher of the following rates:

(i) at the rate specified in the relevant provision of the I.T. Act; or

(ii) at the rate or rates in force; or

(iii) at the rate of twenty per cent.

However, new rule 37BC of the Income Tax Rules provides that the provisions of section 206AA of the Act
shall not apply on payments made to non-resident deductee who do not have PAN in India. The non-resident
deductee in this regard, shall be required to furnish few prescribed details inter alia TRC and Tax
Identification Number (TIN).

A declaration under Section 197A(1) or 197A(1A) or 197A(1C) shall not be valid unless the person furnishes
his PAN in such declaration and the deductor is required to deduct tax as per Para (a) above in such a case.

Where a wrong PAN is provided, it will be regarded as non-furnishing of PAN and Para (a) above will apply
apart from penal consequences.

H. Taxability of Gifts received for nil or inadequate consideration

As per section 56(2)(x) of the I.T. Act, where any person receives debentures from any person on or after
April 01, 2017:

(a) without consideration, aggregate fair market value of which exceeds fifty thousand rupees, then the
whole of the aggregate fair market value of such debentures; or

(b) for a consideration which is less than the aggregate fair market value of the debenture by an amount
exceeding fifty thousand rupees, then the aggregate fair market value of such debentures as exceeds
such consideration; shall be taxable as the income of the recipient at the normal rates of tax. The above
is subject to few exceptions as stated in section 56(2)(x) of the I.T. Act.

NOTES:

1. The above statement sets out the provisions of law in a summary manner only and is not a complete analysis
or listing of all potential tax consequences of the purchase, ownership and disposal of debentures/bonds.

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2. The above statement covers only certain relevant benefits under the Income-tax Act, 1961 and does not cover
benefits under any other law.

3. The above statement of possible tax benefits is as per the current direct tax laws relevant for the Assessment
Year 2021-22.

4. Further, several of these benefits are dependent on the Debenture Holder fulfilling the conditions prescribed
under the relevant provisions.

5. This statement is intended only to provide general information to the Debenture Holder(s) and is neither

(a) designed nor intended to be a substitute for professional tax advice. In view of the individual nature of
tax

(b) consequences, each Debenture Holder is advised to consult his/her/its own tax advisor with respect to
specific tax consequences of his/her/its holding in the debentures of the Company.

6. The stated benefits will be available only to the sole/ first named holder in case the debenture is held by joint
holders.

7. In respect of non-residents, the tax rates and consequent taxation mentioned above will be further subject to
any benefits available under the relevant tax treaty, if any, between India and the country in which the non-
resident has fiscal domicile.

8. In respect of non-residents, taxes paid in India could be claimed as a credit in accordance with the provisions
of the relevant tax treaty and applicable domestic law.

9. No assurance is given that the revenue authorities/courts will concur with the views expressed herein.

Our views are based on the existing provisions of law and its interpretation, which are subject to changes from
time to time. We do not assume responsibility to update the views consequent to such changes.

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OBJECTS OF THE ISSUE

Our Company proposes to utilise the funds which are being raised through the Issue, after deducting the Issue
related expenses to the extent payable by our Company (“Net Proceeds”), estimated to be approximately `20,000
lakhs, towards funding the following objects (collectively, referred to herein as the “Objects”):

1. For the purpose of onward lending, financing, and for repayment/prepayment of principal and interest on
borrowings of the Company; and

2. General corporate purposes.

The main objects clause of the Memorandum of Association of our Company permits our Company to undertake
the activities for which the funds are being raised through the present Issue and also the activities which our
Company has been carrying on till date.

The details of the proceeds of the Issue are set forth in the following table:

(in ` lakhs)
No. Description Amount*
1. Gross proceeds of the Issue Upto 20,000.00
2. (less) Issue related expenses* 330.00
3. Net Proceeds* 19,670.00
*Assuming the Issue is fully subscribed and our Company retains oversubscription up to `10,000 lakhs

Requirement of funds and Utilisation of Net Proceeds

The following table details the objects of the Issue and the amount proposed to be financed from the Net Proceeds:

Percentage of amount proposed to

No. Objects of the Issue
be financed from Net Proceeds
1. For the purpose of onward lending, financing, and for At least 75%
repayment/prepayment of principal and interest on borrowings of the
Company
2. General corporate purposes* Maximum of up to 25%
Total 100%
*The Net Proceeds will be first utilized towards the Objects mentioned above. The balance is proposed to be
utilized for general corporate purposes, subject to such utilization not exceeding 25% of the gross proceeds, in
compliance with the SEBI Debt Regulations.

For further details of our Company’s outstanding indebtedness, see “Financial Indebtedness” on page 126.

Funding plan

Not applicable

Summary of the project appraisal report

Not applicable

Schedule of implementation of the project

Not applicable

Interim Use of Proceeds

Our management, in accordance with the policies formulated by it from time to time, will have flexibility in
deploying the proceeds received from the Issue. Pending utilization of the proceeds out of the Issue for the
purposes described above, our Company intends to temporarily invest funds in high quality interest bearing liquid
instruments including money market mutual funds, deposits with banks or temporarily deploy the funds in

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investment grade interest bearing securities as may be approved by the Board. Such investment would be in
accordance with the investment policies approved by the Board or any committee thereof from time to time. Also,
such investments shall be in line with the guidelines and regulations prescribed by RBI.

Monitoring of Utilization of Funds

There is no requirement for appointment of a monitoring agency in terms of the SEBI Debt Regulations. Our
Board shall monitor the utilization of the proceeds of the Issue. For the relevant Fiscals commencing from Fiscal
2020-2021, our Company will disclose in our financial statements, the utilisation of the Net Proceeds of the Issue
under a separate head along with details, if any, in relation to all such proceeds of the Issue that have not been
utilised thereby also indicating investments, if any, of such unutilised proceeds of the Issue. Our Company shall
utilise the proceeds of the Issue only upon the execution of the documents for creation of security and receipt of
final listing and trading approval from the Stock Exchange.

Variation in terms of contract or objects in this Prospectus

The Company shall not, in terms of Section 27 of the Companies Act, 2013, at any time, vary the terms of the
objects for which this Prospectus is issued, except as may be prescribed under the applicable laws and under
Section 27 of the Companies Act, 2013.

Issue related expenses

The expenses for this Issue include, inter alia, Lead Manager’s fees and selling commission to the Lead Manager,
brokers’ fees payable to Debenture Trustee, the Registrar to the Issue, SCSBs’ commission/fees, printing and
distribution expenses, legal fees, advertisement expenses and listing fees. The Issue expenses and listing fees will
be paid by our Company.

The estimated breakdown of the total expenses for the Issue is as follows*:

(in ` lakhs)
Percentage of overall
Activity Amount
Issue Size (%)
Fees to intermediaries (Lead Manager’s fees, brokerage, rating agency, 200.00 1.00
Registrar to the Issue, legal advisor, Debenture Trustee, etc.)
Advertising and Marketing Expenses 90.00 0.45
Printing, Stationery and Distribution 20.00 0.10
Other Miscellaneous Expenses 20.00 0.10
Total 330.00 1.65
*Assuming the Issue is fully subscribed, and our Company retains oversubscription up to `10,000 lakhs.

The above expenses are indicative and are subject to change depending on the actual level of subscription to the
Issue and the number of Allottees, market conditions and other relevant factors.

Our Company shall pay processing fees to the SCSBs for Application forms procured by the Designated
Intermediaries and submitted to the SCSBs for blocking the Application Amount of the applicant, at the rate of
`10 per Application Form procured (plus other applicable taxes). However, it is clarified that in case of
Application Forms procured directly by the SCSBs, the relevant SCSBs shall not be entitled to any ASBA
Processing Fee.

Other Confirmation

In accordance with the SEBI Debt Regulations, our Company will not utilise the proceeds of the Issue for
providing loans to or for acquisitions of shares of any person who is a part of the same group as our Company or
who is under the same management of our Company.

No part of the Issue Proceeds will be paid by our Company to our Promoters, our Directors, Key Managerial
Personnel or companies promoted by our Promoters.

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The Issue Proceeds shall not be utilised towards full or part consideration for the purchase or any other acquisition,
inter alia by way of a lease, of any property. The Issue Proceeds shall not be used for buying, trading or otherwise
dealing in equity shares of any other listed company.

The Issue Proceeds from NCDs Allotted to banks will not be utilised for any purpose which may be in
contravention of the RBI guidelines on bank financing to NBFCs including those relating to classification as
capital market exposure or any other sectors that are prohibited under the RBI regulations.

Our Company undertakes that the Issue Proceeds from NCDs Allotted to banks shall not be used for any purpose,
which may be in contravention of the RBI guidelines on bank financing to NBFCs.

Our Company confirms that it will not use the proceeds of the Issue for the purchase of any business or in the
purchase of any interest in any business whereby our Company shall become entitled to the capital or profit or
losses or both in such business exceeding 50% thereof, directly or indirectly in the acquisition of any immovable
property or acquisition of securities of any other body corporate.

The fund requirement as above is based on our current business plan and is subject to change in light of variations in
external circumstances or costs, or in our financial condition, cash flows, business or strategy. Our management, in
response to the competitive and dynamic nature of the industry, will have the discretion to revise its business plan
from time to time and consequently our funding requirements and deployment of funds may also change.

Utilisation of Issue Proceeds

(a) All monies received pursuant to the issue of NCDs to public shall be transferred to a separate bank
account other than the bank account referred to in Section 40 (3) of the Companies Act, 2013;

(b) Details of all monies utilised out of the Issue referred to in sub-item (a) shall be disclosed under an appropriate
separate head in our Company’s balance sheet indicating the purpose for which such monies had been utilised;

(c) Details of all unutilised monies out of issue of NCDs, if any, referred to in sub-item (a) shall be disclosed under
an appropriate separate head in our balance sheet indicating the form in which such unutilised monies have been
invested;

(d) The Issue Proceeds shall not be utilised towards full or part consideration for the purchase or any other
acquisition, inter alia, by way of a lease, of any immovable property; and

(e) Details of all utilised and unutilised monies out of the monies collected in the previous issue made by way of
public offer shall be disclosed and continued to be disclosed in the balance sheet till the time any part of the
proceeds of such previous issue remains unutilised indicating the purpose for which such monies have been
utilised and the securities or other forms of financial assets in which such unutilised monies have been invested.

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SECTION IV - ABOUT OUR COMPANY

INDUSTRY OVERVIEW

Unless otherwise indicated, all of the information and statics disclosed in this section are extracted from an
industry report titled “Gold Loan Industry in India”, dated August 9, 2020, prepared and issued by IRR Advisory
Services Private Limited. For details of risks in relation to IRR Report and other publications, see “Risk Factors-
“We cannot guarantee the accuracy or completeness of facts and other statistics with respect to India, the Indian
economy and the NBFC and Gold Loan industry contained in this Prospectus” on page 34. The information
presented in this section, including forecasts and projections, have not been prepared or independently verified
by us, our Directors, our Promoters, the Lead Manager or any of our or their respective advisors.

The data may have been re-classified by us for the purposes of presentation. Industry sources and publications
generally state that the information contained therein has been obtained from sources generally believed to be
reliable, but that their accuracy, completeness and underlying assumptions are not guaranteed and their
reliability cannot be assured. Industry sources and publications are also prepared based on information as of
specific dates and may no longer be current or reflect current trends. Industry sources and publications may also
base their information on estimates, projections, forecasts and assumptions that may prove to be incorrect.
Accordingly, investors must rely on their independent examination of, and should not place undue reliance on, or
base their investment decision solely on this information. The recipient should not construe any of the contents in
the IRR Report as advice relating to business, financial, legal, taxation or investment matters and are advised to
consult their own business, financial, legal, taxation, and other advisors concerning the transaction.

Following is the disclaimer of IRR Report: “This report is prepared by IRR Advisory Services Pvt Ltd (IRR
Advisory). IRR Advisory has taken utmost care to ensure accuracy and objectivity while developing this report.
IRR Advisory is not responsible for any errors or omissions in analysis/inferences/views or for results obtained
from the use of information contained in this report and especially states that IRR advisory has no financial
liability whatsoever to the user of this report. This report is for the information of the intended recipients only and
no part of this report may be published or reproduced in any form or manner without prior written permission of
IRR Advisory”.

OVERVIEW OF GLOBAL ECONOMY

Global economic activity has been brought to a standstill by the COVID-19 pandemic, which is turning out to be
unparalleled in its global impact and the toll it is taking on life and livelihood. The initial signs of the looming
tectonic shifts that COVID-19 would cause became visible when global financial markets turned increasingly
volatile in January 2020 with panic sell-offs, flight to safety and wealth erosion in equity markets across advanced
and emerging economies in similar manner. Sovereign bond yields fell to record lows and liquidity stress
threatened to stall fixed income markets. Earlier weakening of demand was also reflected in commodity price
movements like crude oil, though supply disruptions reported upside pressure on food prices. As the outbreak
spread quickly around the globe, lockdowns and social distancing stalled economic activity across the world.

In its June 2020 update, the International Monetary Fund (IMF) has projected that global output would contract
by 4.9% in 2020, under the assumption of gradual recovery in activity starting in the second half of 2020. The
Organization for Economic Cooperation and Development (OECD) has projected a ‘double – hit’ scenario in
which a second wave of infections erupts in the later part of 2020. In this scenario, the global economy could
contract by 7.6% in 2020.

An overview of the World Economic Outlook (WEO) projections (June 2020) is given in the table below:

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World Economic Outlook (%) Projections (%)

Name of the Country/ Economy 2019 2020 2021
World Output 2.9 -4.9 5.4
Advanced Economies 1.7 -8 4.8
United States 2.3 -8 4.5
Euro Area 1.2 -10.2 6
Germany 0.6 -7.8 5.4
France 1.3 -12.5 7.3
Italy 0.3 -12.8 6.3
Spain 2 -12.8 6.3
Japan 0.7 -5.8 2.4
United Kingdom 1.4 -10.2 6.3
Canada 1.6 -8.4 4.9
Other Advanced Economies 1.7 -4.8 4.2
Emerging Market & Developing Economies 3.7 -3 5.9
China 6.1 1 8.2
India 4.2 -4.5 6
ASEAN* 4.8 -2 6.2
Emerging and Developing Europe 2.1 -5.8 4.3
Russia 1.3 -6.6 4.1
Latin America and the Caribbean 0.1 -9.4 3.7
Brazil 1.1 -9.1 3.6
Mexico -0.1 -10.5 3.3
Middle East and Central Asia 1.2 -4.7 3.3
Saudi Arabia 0.3 -6.8 3.1
Sub-Saharan Africa 3.1 -3.2 3.4
Nigeria 2.2 -5.4 2.6
South Africa 0.2 -8 3.5
Low-Income Developing Countries 5.1 -1 5.2
*includes Indonesia, Malaysia, Philippines, Thailand, Vietnam.
Source - IMF's World Economic Outlook, June 2020

WEO Projections for Advanced Economies

Growth in the advanced economy group is projected at –8.0% in 2020. There appears a deeper hit to activity in
the first half of the year than anticipated, with signs of voluntary distancing even before lockdowns were imposed.
This also suggests a more gradual recovery in the second half as fear of contagion is likely to continue. In 2021,
the advanced economy growth rate is projected to strengthen to 4.8%.

WEO Projections for Emerging Market and Developing Economies

The growth in the group of emerging market and developing economies is forecast at –3.0% in 2020. Growth
among low-income developing countries is projected at –1.0% in 2020. Excluding a few large frontier economies,
the remaining group of low-income developing countries is projected to contract by –2.2% in 2020. For the first
time, all regions are projected to experience negative growth in 2020 except China which is expected to grow by
1.0%. There are, however, substantial differences across individual economies, reflecting the evolution of the
pandemic and the effectiveness of containment strategies, variation in economic structure (for example,
dependence on severely affected sectors, such as tourism and oil), reliance on external financial flows (including
remittances) and pre-crisis growth trends. In China, where the recovery from the sharp contraction in the first
quarter is underway, growth is projected at 1.0% in 2020, supported in part by policy stimulus. India’s economy
is projected to contract by 4.5% following a longer period of lockdown and slower recovery than anticipated. In
Latin America, where most countries are still struggling to contain infections, the two largest economies, Brazil
and Mexico, are projected to contract by 9.1 and 10.5%, respectively, in 2020.

The disruptions due to the pandemic, as well as significantly lower disposable income for oil exporters after the
dramatic fuel price decline, imply sharp recessions in Russia (–6.6%), Saudi Arabia (–6.8), and Nigeria (–5.4),
while South Africa’s performance (–8.0) will be severely affected by the health crisis.

OVERVIEW OF INDIAN ECONOMY

India, the world’s third largest economy in terms of its PPP (purchasing power parity) with population of over
1.3bn has witnessed significant economic growth since the country was liberalized in early 1990s. Industrial
deregulation, divestment of state-owned enterprises, reduced governmental controls on foreign trade and
investment, served to accelerate the country's growth and India has posted an average of 7.0% GDP growth since
beginning of this millennium.

According to IMF, India’s GDP growth rate was at 4.2% in 2019. There is a downward revision to India’s
projection due to spread of COVID-19. IMF estimates India’s GDP growth at -4.5% in 2020, projected to improve
to 6.0% in 2021. India Ratings and Research (Ind-Ra) believes the GDP will contract in each of the quarter as
well as for the year as a whole in FY21. Ind-Ra has revised its FY21 GDP growth forecast further downward to -
5.3%. However, Ind-Ra expects that the GDP growth would bounce back in the range of 5%-6% in FY22, aided
by the base effect and gradual return to normalcy in the domestic as well as global economy.

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Ind-Ra estimates suggest that 61.4% economy (from production side) was under lockdown in April 2020, with
manufacturing (88.2% lockdown) being the hardest hit. Since the government, financial sector, communication
services were operating, the services sector (59.8%) was relatively less impacted compared to manufacturing.
Even before the lockdown, Indian economy had slipped into a slowdown mode. As a result, GDP growth declined
to 4.2% in FY20 from 8.3% in FY17. On a quarterly basis also, GDP growth was on a downhill journey, and
declined to 3.2% in Q4 FY20 (seven days of lockdown). The slowdown was largely on account of a declining
consumption demand and the inability of investment demand to pick up. The lockdown while accentuating this
problem gave both demand and supply shocks to the economy.

Sharpest contraction post-independence

The disruption caused by the COVID-19 pandemic unfolded with such a speed and scale that disruption of
production, breakdown of supply chains/trade channels and total wash out of economic activities in aviation (some
activities have started now), tourism, hotels and hospitality sectors will not allow the economic activity to become
normal throughout FY21. MSMEs, irrespective of the sector they operate in, are witnessing a cash flow crisis.
However, some sectors especially in the services such as banking and financial services, IT and IT enabled
services have been less impacted because they were able to adjust their operations remotely owing to a high
penetration of digital platform in their business operations. This will be the lowest GDP growth in the Indian
history and sixth instance of economic contraction, others being in 1958, 1966, 1967, 1973 and 1980. The previous
low was -5.2% in FY80. Ind-Ra’s quarterly growth forecast for FY21 is -13.6%, -5.3%, -2.5% and -0.3%
respectively for Q1 FY21, Q2 FY21, Q3 FY21 and Q4 FY21.

Policy measure focuses on supply side but demand side measures missing

The GoI also announced an economic package of INR20.97tn (10.0% of GDP) on 12 th May 2020. The measures
announced by the GoI can be broadly kept in three buckets – monetary measures, fiscal measures and policy
reforms. However, excluding the monetary measures and existing proposals in the union budget, Ind-Ra’s
calculations show that the direct fiscal impact is only INR2,145bn (1.1% of GDP). The credit and liquidity
enhancing measures announced in the economic package in combination with some of the earlier steps announced
by the Reserve Bank of India (RBI) will certainly be beneficial especially for MSMEs/non-banking financial
companies/microfinance institutions/power distribution companies, but will largely address the supply-side of the
economy.

Supply is only one side of the economy and can sustain if the matching support comes from the demand side of
the economy. The Indian economy even before the COVID-19 related lockdown was suffering on the demand
side, as all the demand drivers were floundering. The sudden collapse of private final consumption expenditure
(PFCE) growth in FY20 had resulted in a clamour that FY21 budget must focus on measures that will put more
money in the pocket of the people who are at the bottom of the pyramid. The COVID-19 related lockdown and
its impact on economy and livelihoods have only aggravated the sagging consumption demand. The government
was aware of requirement of appropriate demand-side measure in the economic package but hard budget was a
huge constraint. However, the reform measures announced in the area of agriculture especially setting up of
agricultural infrastructure fund, amendment of essential commodities act and a central law for marketing of
agricultural produce will transform the way agricultural commodities are produced, stored and sold in the country

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in the medium to long term. The measure announced for MSME, besides supporting them in the near term, will
strengthen their resilience and productivity in the medium to long term.

All production sectors suffered except Agriculture

Ind-Ra projects agricultural Gross Value Added (GVA) to grow 3.5% (y-o-y) in FY21 (average during FY14-
FY20: 3.6%). This is based on the expectation of a normal and spatially well distributed rainfall and aided by
adequate water in reservoirs. The India Meteorological Department in its second stage forecast for the 2020
Southwest monsoon rainfall has predicted the monsoon rainfall to be 102% of long period average (LPA, 1961-
2010). The industrial and services GVA is expected to contract 15.8% and 2.2%, respectively, in FY21. The
slower contraction of services GVA is mainly due to the continued functioning of the government and financial
sector even during the lockdown. The increased expenditure by the central and state government for alleviating
stress caused by COVID-19 on households and firms to give some boost to public administration and defence
component of services. Although the financial sector is under stress and likely to witness a second wave of non-
performing assets, it is unlikely to contract in FY21.

Challenges faced by Banking industry

Ind-Ra’s analysis suggests COVID-19 may lead to fresh slippages of up to INR5.5tn (5.7%). The agency
estimation shows corporates exposures constitute about 60.0% to the incremental slippages and likely to emanate
from sectors such as power, infrastructure, construction, hospitality, iron & steel, telecom and realty. The balance
40.0% of incremental slippages could come from the non-corporate segments such as retail, agriculture and
MSMEs. The credit cost could increase up to INR2.7tn in FY21. Of this close to 70.0% will be from public sector
banks (PSBs). This would lead to a capital requirement of INR300bn-500bn for PSBs under non-accelerated
provisioning.

Demand recovery would be led by essentials and followed by Non-Discretionary in India

Nearly half of PFCE (average during FY12-FY19: 49.4%) is in services. Although the share of PFCE on consumer
durables is just 3.3%, it is the most buoyant component (9.3% growth). PFCE on durable/luxury goods from the
upper income category is unlikely to be affected significantly. PFCE from the middle-income category will be
impacted due to job losses and salary cuts. Ind-Ra’s estimate suggest that PFCE on durable goods, semi-durable
goods, non-durable goods and services will contract by 3.1%, 5.2%, 5.4% and 5.0%, respectively, on a year-on-
year basis in FY21.

It is expected that essentials (pharma, healthcare and telecom) in the manufacturing sector to recover first
(reaching Q1 FY20 level) in Q2 FY21, followed by non-discretionary consumer goods and infrastructure sector
(chemicals, oil & gas, IT, sugar and agro-commodities) in Q3 FY21 and industrial goods and cyclical sectors
(power, iron & steel, logistics, cement, construction, automobiles and automobile ancillaries) in Q4 FY21.
Discretionary consumer goods sector such as airlines, hotels, airport, real estate and construction is unlikely to
recover in FY21 and will witness some recovery only in Q1 FY22.

Investment revival pushed beyond FY22

Ind-Ra’s estimate suggests that GFCF (fixed capital) will contract 17.6% (y-o-y) in FY21. activities were down
and out over the past several years. Due to the COVID-19 pandemic, the investment revival will now be pushed
beyond FY22 because of combination of factors such as excess capacity, weak domestic and global demand,
stretched/leveraged balance sheet of Indian corporates and budget constraints leading to reduced government
capex.

Fiscal Deficit of centre to escalate to 7.6% of GDP in FY21

The central government fiscal deficit is expected to increase to INR14.86tn in FY21 (FY21 (Estimated):
INR7.96tn, FY20 (provisional): INR9.36 trillion). The contraction in nominal GDP, and low revenue and capital
receipts are likely to reduce overall receipts by INR5.49tn (79.6% of fiscal slippage). Tax revenues are estimated
to be lower by INR3.54tn than the FY21 (Estimated) and shortfall on capital receipts is expected to be INR1.60tn.
The entire shortfall on capital receipts will originate from disinvestments missing the target. Factoring in the
INR2,145bn fiscal stimulus (part of the INR20.97tn package announced by the government), the freeze in dearness
allowance/dearness relief till July 2021, the low crude oil prices and demand for oil products, the 10% increase in
revenue expenditure excluding wages, interest and subsidies coupled with expenditure prioritisation, revenue

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expenditure is expected to increase to INR29.13tn in FY21 from the budged INR26.30tn. This will translate into
a 41.1% slippage in fiscal deficit (1.44% of GDP). While the headline increase in revenue expenditure is only
1.44% of GDP, the actual expenditure increase due to the factors mentioned above is estimated to be INR4.44tn
(2.26% of GDP), which is low and may jeopardise any quick and sustained growth recovery in FY22 and FY23.

Globally, capex and social sector expenditure are soft targets at the time of fiscal adjustment. Capex had contracted
23.7% y-o-y in FY09 in the aftermath of Global Financial Crisis. There might be a 20.0% y-o-y capex contraction
in FY21. Factoring in these fiscal adjustments, FY21 fiscal deficit would be around 7.6% of GDP compared to
budgeted 3.5%.

Inflation to stay benign but interest rate will be elevated compared to policy rate

Ind-Ra expects the retail and wholesale inflation to come in at 3.6% and 1.2%, respectively, in FY21. Inflation in
FY21 will be largely governed by monsoon rainfall, global commodity prices especially crude oil and
monetary/fiscal policy pursued by the RBI/GoI to mitigate COVID-19. Both retail and wholesale inflation had
seen some spike towards the end of 2019 and early 2020 but showed a moderation in March 2020. While retail
inflation declined to 5.6% in March 2020 from 6.6% in February 2020, wholesale inflation declined to 0.4% from
2.3%. The retail food inflation data shows that after spiking to 10.7% in April 2020 from 6.9% in March 2020, it
came down to 9.7% in May 2020. The wholesale inflation data for the month of May 2020 is available and it is -
3.2%. Despite the supply-side disruptions which are getting improved after the lockdown is lifted, the depressed
demand conditions in the economy will keep both retail and wholesale inflation low and under check in the near
term.

RBI had been quite swift and proactive both before and after the lockdown to ensure smooth functioning of the
financial market. Various RBI’s announcements covered several areas and can be put into four buckets like
reduction in policy rates/reserve ratios, interest rate moratorium, easing of regulatory/compliance norms for credit,
and banking system liquidity. Although the measures were targeted towards easing the tight monetary conditions
building up in the economy, the financial market reacted otherwise and lenders including banks instead of lending
became risk averse. As a result, the lending window provided by the RBI to banks via targeted long-term repo
operations ended up lending to either public sector units or entities rated AA and above. Even the rate spread
between the policy rate and instruments of various tenors, instead of coming down, widened. The spread between
10-year G-sec and policy rate averaged 186bp in June 2020 (up to 15 June).

Current Account Deficit will remain comfortable

The weak domestic and global demand conditions will keep CAD in a comfortable zone. Ind-Ra expects CAD to
come in at USD3.3bn (0.1% of GDP) in FY21. However, Q1 FY21 may see current account surplus. The weak
domestic demand will keep import demand low. Although the weak global demand will translate into soft global
commodity prices especially crude, it will also translate into weak exports. Ind-Ra expects merchandise exports
to decline 9.4% in FY21 (FY20: -4.9%), as all major export commodities are expected to clock negative growth.
Exports of petroleum products and gems & Jewellery are estimated to decline 14.5% and 16.0% y-o-y,
respectively, in FY21.

Merchandise imports are expected to decline 17.4% y-o-y in FY21 (FY20: -8.9%). The import of coal; coke and
briquettes, crude oil and gold and transport goods is estimated to decline 19.2%, 22.5%, 21.0% and 34.2%, y-o-y
respectively, in FY21. As a result, the trade deficit is estimated to decline to a four-year low of USD97.7bn (3.9%
of GDP). Although remittances and software exports are also expected to have been affected by COVID-19
pandemic, it is likely to be lesser impacted than merchandise trade. It may be worthwhile to note here that services
trade (excluding remittances and investment income from invisibles as per Balance of Payment) increased to
USD6.67bn/month in FY20 from USD5.80bn/month in FY18. Therefore, services exports and remittances will
continue to provide cushion to India against its trade deficit.

Capital flows are estimated to decline to USD68.1bn in FY21 from USD77.7bn in FY20. However, due to the
lower CAD, the forex reserve could go up by USD64.8bn. This may put pressure on the Indian rupee to appreciate.
But global dynamics might act in a reverse direction leading to the rupee weakening by 7.2% y-o-y in FY21. This
will translate into the rupee averaging 75.98/USD in FY21 as against 70.88/USD in FY20.

OVERVIEW OF THE NBFC MARKET IN INDIA

Introduction

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Non-banking Financial Institutions (NBFIs) form an integral part of the Indian financial system by complementing
the banking sector in reaching out credit to the unbanked segments of society, especially to the micro, small and
medium enterprises (MSMEs) which form the cradle of entrepreneurship and innovation.

Structure of NBFIs under the Reserve Bank Regulation

Source: Reserve Bank of India

Notes: Figures in the bracket indicate the number of institutions

On the basis of liabilities, NBFCs are classified into two categories (i) NBFCs-Deposit taking (NBFCs-D) and (ii)
NBFCs-Non-Deposit taking (NBFCs-ND). NBFCs-D are subject to requirements of capital adequacy, liquid
assets maintenance, exposure norms (including restrictions on exposure to investments in land, building, and
unquoted shares), Asset-liability management and reporting requirements. The NBFCs, depending upon its nature
of business, are broadly categorized as loan companies, investment companies, infrastructure finance companies
(IFC), asset finance companies (AFC), core investment companies (CIC), infrastructure debt funds, micro finance
institutions. The regulatory and supervisory framework for NBFCs has been continuously strengthened in order
to ensure their strong and healthy functioning, limit excessive risk-taking practices, and protect the interests of the
deposit holders.

NBFCs are primarily governed by the RBI Act and the RBI Master Directions. NBFCs are permitted to operate
in similar sphere of activities as banks; there are a few important and key differences. The most important
distinctions are:

• An NBFC cannot accept deposits repayable on demand – in other words, NBFCs can only accept fixed term
deposits. Thus, NBFCs are not permitted to issue negotiable instruments, such as cheques which are payable
on demand; and
• NBFCs are not allowed to deal in foreign exchange, even if they specifically apply to the RBI for approval in
this regard.

Further, while an NBFC may be registered as a deposit accepting NBFC (“NBFC-D”) or as a non-deposit
accepting NBFC (“NBFC-ND”), NBFCs registered with RBI are further classified as:

• Asset Finance Companies: The main business of these companies is to finance the assets such as machines,
automobiles, generators, material equipment.

• Investment Companies: The main business of these companies is to deal in securities.

• Systemically Important Core Investment Company (CIC-ND-SI): A systematically important NBFC

(assets INR1.0bn and above) which has deployed at least 90% of its assets in the form of investment in shares
or debt instruments or loans in group companies is called CIC-ND-SI. Out of the 90%, 60% should be invested
in equity shares or those instruments which can be compulsorily converted into equity shares. Such companies
do accept public funds.

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• Loan Companies: The main business of such companies is to make loans and advances (not for assets but
for other purposes such as working capital finance etc.).

• Infrastructure Finance Companies (IFC): A company which has net owned funds of at least INR3.0bn and
has deployed 75% of its total assets in Infrastructure loans is called IFC provided it has credit rating of A or
above and has a CRAR of 15%.

• Infrastructure Debt Fund – NBFCs (IDF-NBFC): An IDF-NBFC is a non-deposit taking NBFC that has
Net Owned Fund of INR3.0bn or more and which invests only in Public Private Partnerships and post
commencement operations date (COD) infrastructure projects which have completed at least one year of
satisfactory commercial operation and becomes a party to a Tripartite Agreement.

• NBFC - Micro Finance Institutions: Microfinance companies are non-deposit taking firms that are entitled
to provide loans up to INR50K to individuals coming under low-income group living in rural or semi-urban
areas.

• NBFC – Factors: An NBFC-Factoring Company should have a minimum Net Owned Fund (NOF) of
INR50.0mn and its financial assets in the factoring business should constitute at least 75 % of its total assets
and its income derived from factoring business should not be less than 75 % of its gross income.

• Mortgage Guarantee Companies: Mortgage Guarantee Company acts as an insurance against defaults on
loans by the homebuyer, thereby reducing the loan exposure and credit risks for the lender.

• NBFC-Non-Operative Financial Holding Company (NOFHC): For permitting promoter/ promoter groups
of NBFCs to set up a new bank.

EVOLUTION OF GOLD LOAN MARKET IN INDIA

Introduction

Gold has long been a valued commodity, historically regarded as among the most liquid assets and accepted
universally as a currency since time immemorial. In India, Gold has traditionally been consumed by individuals
in the form of jewellery – it is considered auspicious to buy gold jewellery during festive seasons - and handed
down generations as family wealth. Gold is considered to be a safe haven in times of economic uncertainty, a fact
exemplified by almost a 450x time’s rise in gold prices over the past five decades.

Gold Demand in India

India is one of the largest markets for gold and growing affluence is driving growth in demand. Gold has a central
role in the country’s culture, considered a store of value, a symbol of wealth and status and a fundamental part of
many rituals. Two-thirds of India’s gold demand came from rural areas, where jewellery is a traditional store of
wealth. The chart given below depicts the trend of India’s gold demand (in tonnes) from 2013-19.

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As per recent WGC report, India's gold demand for the April-June quarter of 2020 contracted to 63.7 tonnes, down
70.0% as compared to 213.2 tonnes in the same period last year. This is a 11-year low. India’s gold demand during
the quarter was valued at INR266.0bn, down by 57.0% as compared to INR624.2bn in the same period last year.
Total jewellery demand in India decreased by 74.0% to 44 tonnes as compared to 168.6 tonnes in the April-June
quarter of 2019. The value of jewellery demand was INR183.5bn, down by 63.0% from INR493.8bn in the same
period last year. Total investment demand for the quarter at 19.8 tonnes was down by 56.0% in comparison to
44.5 tonnes in the same period last year. In value terms, gold investment demand was INR82.5bn, down by 37.0%.
Total gold recycled was 13.8 tonnes, down by 64.0% y-o-y. Total gold imports during the quarter was 11.6 tonnes,
down by 95.0% compared to 247.4 tonnes y-o-y. The quarter was defined by lockdowns and high prices, both of
which acted in combination to keep India’s gold demand record low.

Gold Price Movement in India

Gold prices in India have been showing an overall upward trend since the last 3 decades. There was a steady
increase in the prices of gold from FY04 to FY13. From FY14 to FY16; there was a decline in gold prices owing
to geopolitical stability, low oil prices, low inflation and strong growing equity market. During this period, gold
lost its attractiveness to investors either from a capital appreciation perspective as a hedge against inflation or as
a safe haven; causing a significantly reduced demand. However, from FY17 to FY19, gold prices started to surge
to the pre-FY13 levels, further increasing to INR40,740.0/gram in FY20. Currently, the rapid spread of
coronavirus cases and its potential negative impact on the global economy are prompting investors to take refuge
in safe havens like gold.

Gold prices hit over INR50,000 per 10 grams in India which is the world’s second-largest gold consumer after
China as a host of factors like global uncertainties triggered by pandemic, weak dollar, low-interest rates and
stimulus programmes have increased the appetite for gold. Like money market and high-quality bond funds, gold
benefited from investors’ need to reduce risk, with the recognition of gold as a hedge further underscored by the
record inflows seen in gold-backed Exchange Traded Funds. Gold prices in India are dictated by international
prices. International gold prices have been on the rise in the last few months and picked up pace amid sharp losses
in the dollar, additional stimulus measures and robust investor inflows. US-China tensions have also underpinned
the gold prices.

Gold Loan Market in India

Gold enjoys a unique connection with Indians in terms of social status, financial security and rich cultural legacy.
Along with the country’s growing population and ever increasing disposable income, India’s inclination and liking
for gold has also increased. Due to the emotional value associated with household jewellery, people are hesitant
to sell their gold to meet their immediate financial needs; as an alternative, people pledge their gold ornaments as
collateral and secure a short-term loan. The pledging of gold ornaments and other gold assets to local pawnbrokers
and money lenders to avail loans has been prevalent in Indian society over ages. The increased holding of gold as
an asset among large section of people, and the practices related to borrowing against gold in the informal sector,

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have encouraged some loan companies to provide loans against the collateral of used household gold jewelleries.
Over a period of time, many companies have emerged as ‘specialised gold loan companies’.

Gradually, the market entered a period of rapid growth. The key factors that drove the rapid growth phase included
low cost of funds (eligibility under Priority Sector Lending), rise of India’s middle class, consumerism and
urbanization, rising gold prices, and high Loan to Value (LTV) of up to 90.0% (only for scheduled commercial
banks, it is still 75.0% for NBFCs). Convenience of access, quick disbursals and lower interest rates compared to
moneylenders led to NBFCs becoming the customer’s de-facto choice.

In order to stabilize the proliferation and books of gold loan NBFCs, RBI intervened and released certain
guidelines:

• Removal of Priority Sector Lending (PSL) status. This immediately resulted in substantially higher borrowing
cost.

• LTV capped at 90% - As per notification dated 6th August 2020, RBI capped LTV at 90.0% for scheduled
commercial banks. The LTV is 75.0% for NBFCs. It will weaken the competitive advantage of NBFCs
against commercials banks.

• Restricted credit exposure to single gold NBFC to 7.5% from 10.0% resulting in lower bank funding.

• Prohibition of grant of loans against bullion and gold coins.

Meanwhile, from the beginning of 2013, gold prices reduced drastically globally. With the pledged gold having
lower market value, customers walked away from the loans resulting in increased Non-Performing Assets (NPAs).
The gold loan industry was also subsequently impacted by demonetization in 2016 when cash crunch in the market
led to immediate shortfall in business. However, digital eco-system is now leading to increased credibility and
tilting scales of gold loan business in favor of the specialized gold loan NBFCs. Alongside, the introduction of
GST in 2017 has also impacted the market. In the pre-GST era, the taxation on gold was 1.0% excise duty, along
with a VAT of 1-1.5%, totalling to 2.0% tax. GST rates on gold have now been pegged to 3.0%. This is in addition
to an import duty of 12.5% and 5.0% GST on making charges.

Most of the gold in India is held by people in rural market. Rural residents and low income groups are the major
customers of gold loans, as gold is usually the only asset they possess, in some quantity. They also typically lack
access to banking facilities. Thus gold loan has emerged as one of the most reliable credit sources for these
categories of customers. At a broader level, there are mainly two categories of gold loan providers:
(i) Formal sector (Banks, NBFCs and cooperatives)
(ii) Informal sector (local moneylenders).

Gold Loan NBFCs in India

Till the last century, most of the lending was in the unorganized sector through pawnbrokers and money lenders.
However, this scenario has changed over the last two decades post India’s economic liberalization and financial

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sector reforms, and the organised sector has become more dominant. Buoyed by the spurt in gold prices during
the last decade, organised lenders grew during the period FY09 to FY12. However, correction in gold prices in
FY13, adverse regulatory scenario, restrictions on offering high LTV products, and increase in competition
intensity has seen gold loan industry’s AUM stagnating. This is also reflected in the stagnating portfolio of gold
loan NBFCs.

The total gold loan industry AUM stood at approximately INR9,851.4bn in FY20, out of which approximately
35% accounted for organised market. India’s unorganised gold loan market is estimated to be around 65% of the
total gold loan market. There are no official estimates available on the size of this market, which is characterised
by the presence of numerous pawnbrokers, moneylenders and landlords operating at a local level. However, this
market is believed to be almost double the size of organised gold loans market.

The demand for gold has a regional bias with southern Indian states accounting for around 40.0% of the annual
demand. There is potential to expand gold loans market to the Northern and Western regions of India, provided
the branch network is expanded and the loans are available with ease and with flexible options. The prevalence of
high level of rural indebtedness, easy availability of gold loans on extremely flexible terms, relative scarcity of
personal and retail loans from the banks, and changing attitude of customers to gold loans will contribute to the
growth in the gold loan AUM to newer regions.

Growth in Gold Loans market of Organized Players in the Last 5 Years

As per WGC report, the organized gold loan industry is around 35.0% and unorganized industry is around 65.0%.
The total gold loan industry AUM stood at INR9,851.4bn in FY20, out of which approximately 35.0% valuing
INR3,448.0bn accounted for organised market.

NBFCs were marked by slowdown and weakening competitive positioning during FY12 and FY15 owing to
withdrawal of eligibility for NBFCs under priority sector lending, RBI putting a ceiling on LTV ratio that could
be given out by NBFCs at 60%, as against 75% for banks and RBI norms for conducting gold loan auctions.
Industry reports state that Indian Gold loan market of organised players has increased at a CAGR of 9% from
INR2,203.6bn in FY15 to INR3,448.0bn in FY20 owing to increase in gold prices, good monsoon and favourable
macroeconomic factors. During this period, NBFCs’ focused on improving the business per branch, undertook
aggressive marketing and diversified into new regions.

Growth in Gold Loans market of NBFCs (Gold Loan) in the Last 5 Years

As per industry reports, the gold loan AUM of NBFCs grew at a CAGR of 10.0% between FY15 and FY20.
NBFCs witnessed a decline in gold loan AUM between FY12 and FY14, as RBI’s regulations curbed the
performance as mentioned earlier. However, due to NBFCs flexible loan offerings and quicker disbursement time
helped them to grow their gold loan AUM from INR499.5bn in FY15 to INR544.4bn in FY16.

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Gold Loan NBFCs AUM further grew by an impressive 10.5% over the next 4 years from INR544.4bn in FY16
to INR812.4bn in FY20 due to geographic expansion, rise in gold prices and higher marketing expenditure
undertaken by players in order to improve product awareness and build brand identity. NBFCs and banks approach
the gold loan market differently, which is reflected in their interest rates, ticket sizes and loan tenures.

NBFCs focus more single-mindedly on the gold loans business and have accordingly built their service offerings
by investing significantly in manpower, systems, processes and branch expansion. This has helped them attract
and serve more customers.

Overview of some operational parameters of organized players is provided below:

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Percentage share of organized players in Gold Loan market is provided below:

Muthoot Finance Ltd. had the major share of gold loan AUM in H1 FY20 (46.3%) as well as in FY19 (46.8%).
Manappuram Finance Ltd. market share has increased from 17.7% in FY19 to 20.1% in H1 FY20. Muthoottu
Mini Financers Ltd. market share increased from 1.8% in FY19 to 2.1% in H1 FY20.

KEY GROWTH DRIVERS FOR GOLD LOAN

Gold financing companies form an integral part of the Indian financial system. It plays an important role in nation
building and financial inclusion by complementing the banking sector in reaching out credit to the unbanked
segments of society, especially to the MSMEs, which form the cradle of entrepreneurship and innovation. NBFCs’
ground-level understanding of their customers profile and their credit needs gives them an edge, as does their
ability to innovate and customise products as per their clients’ needs. This makes them the perfect conduit for
delivering credit to lower-income group people and MSMEs. Gold loan as a credit product is not a new
phenomenon in the country; it is only in the recent past that Indians have started losing their inhibitions over
pledging their family heirlooms to mainstream commercial lenders and leveraging multiple benefits, such as
instant credit, flexible schemes, lower interest rates and minimal paperwork without the hassles of rigid credit
appraisal. As banks and NBFCs offer gold loans at interest rates much lower than those of informal moneylenders;
they have successfully targeted a new segment of customers who would have otherwise not taken a gold loan. The
key growth drivers for gold loan are provided below:

Lack of Reach of Banking to Rural and Lower-Income Groups

In India, the reach of NBFCs in rural areas is comparatively higher than the banks. Due to which NBFCs have an
advantage in terms of business revenue and larger base of customer over the banks. The traditional banking
products are not accessible to rural and lower-income groups as those products are to relatively higher-income
groups. A farmer, for example, earns his living based on harvests. If the farmer takes loan, his loan repayment
ability would depend on factors outside his control: monsoon, harvest output and market prices. Credit scores
would undermine one’s effort to get normal loans during distress periods. This is the situation faced by a large
portion of the Indian population engaged in farming and rural employment. Gold loans offer a viable solution in
this situation since, gold loans are fully securitized, lenders have the option to recoup the full principle amount (in
most cases) if the borrower defaults - hence, there is no need for extensive checks on borrower’s previous
repayment records. The relative ease in obtaining a loan approval has boosted the popularity of gold loans.

Expected Revival in Rural Consumption

WGC estimates that about 65% of the Indian household gold belongs to rural communities, who are the biggest
purchasers of gold loan. Unpredictability of the rain and harvest season means farmers become cash-strapped
frequently. For them, unlocking value of their household gold is the easiest way to meet their financial obligations.
Consumption growth in rural India had outpaced urban spending by the widest margin in last decade, encouraged
by relatively good rainfall and an increase in government spending on infrastructure. However, the year 2019
witnessed a slowdown in the rural market due to factors such as liquidity crunch, drop in gross domestic product
(GDP), floods in several parts, weakened household spending, high food inflation due to spike in milk and onion
prices impacted consumer wallet in rural regions. The rural consumption was back on high single digit growth in
FY20, helped by factors including government spending in infra projects and increased rural spending.

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Additionally, the expected rise in consumerism in rural areas will lead to increased gold loans being taken for
non-income generating purposes.

Changing Attitudes Towards Gold Loan

Few decades back, the gold loan was a high-cost affair, interest charged were around 35-50% (local moneylenders)
but now organized players in the market (banks and NBFCS) offer the loan at 12-20% per annum. In recent, gold
loan is becoming a word of mouth whether it is Tier1, Tier2 or Tier 3 cities – people are turning more towards
depositing gold with banks and NBFCs because it is one of the easiest way to avail money. The overall process
to avail gold loans has become more formal and transparent with an entry of organized financial players. Further,
gold is a secured asset and there is no requirement of any additional collateral but however; to avail home loans
& personal loans, one need to show income certificates, bank statements & income tax returns. One good thing
about gold loan is that it can be used for any purpose so more and more people are migrating towards this loan. It
is not only the rural communities who are willing to put household jewellery in the market – acceptance towards
using family gold for financial needs is increasing in the relatively untapped urban market. Using gold loans to
meet household exigencies is gaining popularity in Indian cities and metros.

Ease of Availability of Gold Loan

NBFCs offer very competitive gold loan schemes with a wide range of tenures, interest slabs and repayment
options making it very attractive for the customer. Unlike the rigid products offered by traditional banks, gold
loan products are designed in a way that specifically meets the situation of the target customer segments.
Disbursements are made within a quick time period after loan approval with a turnaround time (TAT) of around
10 minutes. A good number of loans do not have fixed Equated Monthly Instalment (EMI) facility - only the
interest needs to be paid on a monthly basis while the principle should be paid at the end of the tenure. The ability
to choose product features (repayment scheme, tenure) has facilitated increased gold loan penetration.

Development of online gold loan market

Many new age fintech companies and traditional players have started to offer innovative products such as online
gold loans catering to the young and urban population. Primary beneficiaries of online gold loan facilities are
digitally and financially literate customers who belong to the age group of 25 to 40 years. Gold loan companies
have come up with various operating models like visiting customer’s residence, allowing customers to place their
gold within the NBFC’s vault after which customers have the option to pledge this gold via online channels and
receive funds directly to their bank accounts. A leading NBFC saw gold loan disbursed through online channels
surging from 12.0% in FY17 to 48.0% in FY20 which further increased to 63.0% in Q1 FY21 due to spread of
COVID-19.

REGULATORY MEASURES IMPACTING THE GOLD LOAN MARKET IN INDIA

As per the RBI circular dated 6th August 2020, to mitigate the economic impact of the COVID-19 pandemic on
households, entrepreneurs and small businesses, the permissible LTV for loans against pledge of gold ornaments
and jewellery for non-agricultural purposes is increased from 75.0% to 90.0% for scheduled commercial banks.
The LTV is still 75.0% for NBFCs. This enhanced LTV ratio will be applicable up to 31st March 2021 to enable
the borrowers to tide over their temporary liquidity mismatches on account of COVID-19. Accordingly, fresh gold
loans sanctioned on and after 1st April 2021 shall attract LTV ratio of 75.0% for scheduled commercial banks.

NBFCs primarily engaged in lending against gold jewellery (such loans comprising 50% or more of their financial
assets) shall maintain a minimum Tier l capital of 12.0%. The RBI Master Directions have issued guidelines with
regard to the following:

Appropriate Infrastructure for Storage of Gold Ornaments: A minimum level of physical infrastructure and
facilities is available in each of the branches engaged in financing against gold jewellery including a safe deposit
vault and appropriate security measures for operating the vault to ensure safety of the gold and borrower
convenience. Existing NBFCs should review the arrangements in place at their branches and ensure that necessary
infrastructure is put in place at the earliest. No new branches should be opened without suitable storage
arrangements having been made thereat. No business of grant of loans against the security of gold can be
transacted at places where there are no proper facilities for storage/security.

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Prior Approval of RBI for Opening Branches in Excess of 1,000: It is mandatory for NBFC to obtain prior
approval of the RBI to open branches exceeding 1,000. However NBFCs which already have more than 1,000
branches may approach the Bank for prior approval for any further branch expansion. Besides, no new branches
will be allowed to be opened without the facilities for storage of gold jewellery and minimum security facilities
for the pledged gold jewellery.

Standardization of Value of Gold in Arriving at the Loan to Value Ratio: For arriving at the value of gold
jewellery accepted as collateral, it will have to be valued at the average of the closing price of 22 carat gold for
the preceding 30 days as quoted by The Bombay Bullion Association Limited.

Verification of the Ownership of Gold: RBI has directed all NBFCs to put in place an explicit policy approved
by their board of directors within their overall loan policy to verify ownership though a suitable document which
is prepared to explain the manner in which ownership is determined, particularly in each case where the gold
pledged at any one time or cumulatively on the loan outstanding is more than 20 grams.

Auction Process and Procedures: The following additional stipulations are made with respect to auctioning of
pledged gold jewellery:

➢ The auction should be conducted in the same town or taluka in which the branch that has extended the loan
is located.

➢ While auctioning the gold the NBFC should declare a reserve price for the pledged ornaments. The reserve
price for the pledged ornaments should not be less than 85% of the previous 30 day average closing price
of 22 carat gold as declared by India Bullion Association Ltd. formerly known as The Bombay Bullion
Association Ltd. and value of the jewellery of lower purity in terms of carats should be proportionately
reduced.

➢ It will be mandatory on the part of the NBFCs to provide full details of the value fetched in the auction and
the outstanding dues adjusted and any amount over and above the loan outstanding should be payable to
the borrower.

➢ NBFCs must disclose in their annual reports the details of the auctions conducted during the financial year
including the number of loan accounts, outstanding amounts, value fetched and whether any of its sister
concerns participated in the auction.

Other Instructions:

➢ NBFCs financing against the collateral of gold must insist on a copy of the PAN Card of the borrower for
all transaction above INR0.5mn.

➢ High value loans of INR0.1mn and above must only be disbursed by cheque.

➢ Documentation across all branches must be standardized.

➢ NBFCs shall not issue misleading advertisements like claiming the availability of loans in a matter of 2-3
minutes.

Details of the key guidelines impacting the gold loan market in India are provided below:

Loan to Value Ratio (LTV)

LTV ratio describes the size of a loan which is taken out compared to the value of the asset securing the loan.
Lenders and others use LTV's to determine how risky a loan is. A higher LTV ratio suggests more risk because
the assets behind the loan are less likely to pay off the loan as the LTV ratio increases. The LTV ratio has been
capped at 90.0% for traditional banks providing gold loan services but it is still 75.0% of the NBFCs. RBI
regulations state that - gold jewellery accepted as security/collateral will have to be valued at the average of the
closing price of 22 carat gold for the preceding 30 days as quoted by the India Bullion and Jewellers Association
Ltd. If the gold is of purity less than 22 carats, the collateral should be translated into 22 carat value and exact
grams need to be valued. Loan against bullion, units of Exchange-Traded Fund (ETF) and units of gold mutual
funds is not permitted. This standardisation and increased transparency of LTV calculations across the organised
sector has meant healthy businesses for NBFCs.

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Know Your Customer (KYC)

The RBI KYC directions are applicable to NBFCs and RBI has advised all NBFCs to adopt the same with suitable
modifications depending upon the activity undertaken by them and ensure that a proper policy framework of anti-
money laundering measures is put in place. The KYC policies are required to have certain key elements, including,
customer acceptance policy, customer identification procedures, monitoring of transactions and risk management,
diligence of client accounts opened by professional intermediaries, customer due diligence and diligence of
accounts of politically exposed persons, adherence to RBI KYC directions and the exercise of due diligence by
persons authorised by the NBFC, including its brokers and agents.

For verification purposes, a customer needs to submit the following: government issued identity proof (passport,
PAN card, voter’s ID or driving license, along with passport size photographs), address proof (either electricity
bill, ration card or telephone bill) and signature proof. The NBFCs are now allowed to make use of e-KYC which
uses Aadhaar card validation. The move towards e- KYCs is meant to reduce risk of fraud and forgery as well as
improve application processing speeds.

Changes in classification of Non-Performing Asset

The RBI Master Directions require that every non-deposit taking NBFC shall, after taking into account the degree
of well-defined credit weaknesses and extent of dependence on collateral security for realisation, classify its
lease/hire purchase assets, loans and advances and any other forms of credit into the following classes:

• Standard Assets;

• Sub-Standard Assets;

• Doubtful Assets; and

• Loss Assets
Further, the class of assets referred to above shall not be upgraded merely as a result of rescheduling, unless it
satisfies the conditions required for an upgrade. A NBFCs-ND is required to make provisions against sub-standard
assets, doubtful assets and loss assets in accordance with the Master Directions. In terms of the Master Directions,
NBFCs-ND has to make the following provisions on their loan portfolio.

Asset Classification Provisioning Policy

Standard Assets 0.4%
Sub-standard Assets 10.0%
100.0% of unsecured portion + 20%
Doubtful Assets
- 50% of secured portion
Loss Assets 100.0% provided if not written off
Source: RBI Circular

The time frame for classification of NPAs for NBFCs has been brought on par with banks. RBI mandated from
FY18, a loan is termed as a NPA if interest is not paid for 90 days (3 months). In 2016, the time period was 5
months, while it was 4 months in 2017. However, it should not be a cause for concern, since default is not an issue
for a gold finance company, as the loan is fully secured. In case of non-payment, the gold finance company could
simply auction off the gold underlying to recover the interest and principal.

Verification of Gold Ownership

RBI in January 2014, has directed all NBFCs should have Board approved policies in place to satisfy ownership
of the gold jewellery and adequate steps be taken to ensure that the KYC guidelines stipulated by the RBI are
followed and due diligence of the customer undertaken. Where the gold jewellery pledged by a borrower at any
one time or cumulatively on loan outstanding is more than 20 grams, NBFCs must keep record of the verification
of the ownership of the jewellery. Further, it is not necessary to produce original receipts to establish ownership.
Instead, a suitable document may be prepared to explain how the ownership is determined. The method of
establishing ownership should be laid down as a board approved policy.

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Gold Monetisation Scheme (GMS)

The government in the late 1990s also tried to monetize the idle gold hold by Indian households by bringing it
into use for the industry and to reduce dependency on imports. Gold Deposit Scheme (GDS) was introduced in
September 1999 to allow individuals to deposit gold at banks and receive interest in return. Further, the scheme
was also exempt from capital gains, wealth and income tax. However, the minimum deposit of 500 grams was a
huge deterrent for many individuals and households to avail this scheme. Between 1999 and 2015, only 15% of
gold was mobilized reflecting the inefficiency of GDS structure. GDS was reintroduced in the Union Budget 2015
by Finance Minister Mr. Arun Jaitley in a new avatar - ‘Gold Monetisation Scheme’ with the minimum deposit
size being reduced to 30 grams. This scheme offers an annual tax free-interest starting from 0.6% (Short-term:
upto 3 years) to 2.5% (Long-term: upto 15 years).

The objective of GMS is to mobilize gold held by households and institutions of the country and facilitate its use
for productive purposes, and in the long run, to reduce country’s reliance on the import of gold. All Scheduled
Commercial Banks excluding Regional Rural Banks are eligible to implement the scheme. It includes Revamped
Gold Deposit Scheme (R-GDS) and Revamped Gold Metal Loan Scheme (R-GML). The minimum deposit at any
one time is 30 grams of raw gold (bars, coins, jewellery excluding stones and other metals). There is no maximum
limit for deposit under the scheme. Also, the interest earned on the gold deposit will be exempted from not only
income tax but also capital gains tax.

OUTLOOK OF THE GOLD LOAN MARKET IN INDIA

5 year outlook of the Gold Loan Market in India

India is one of the largest markets for gold and in our Indian culture gold is considered as auspicious, particularly
in Hindu and Jain cultures and gold is worn for important ceremonies and occasions. Gifting gold is a deeply
ingrained part of marriage rituals in Indian society where weddings generate approximately about 50% of annual
gold demand. Rural residents and low income groups are the major customers of gold loans, as gold is usually the
only asset they possess. Gold loan has emerged as one of the most reliable credit sources for these categories of
customers. Further the gold loan market is still underpenetrated, considering the abundant availability of gold as
collateral with Indian private households. This could play a vital role in the expansion of gold loan market. IRR
Advisory has estimated that the organized market size will grow to INR4,780.0bn by FY24P.

With the credit demand expected to rise, the gold loan industry is expected to grow over the next few years at a
CAGR of 10.0% from INR2,930.0bn in FY19 to INR4,780.0bn in FY24P which would be driven by gold loan
NBFCs moving into Non-Southern Indian territories, improving penetration, improving product awareness and
building brand identity. Diversification into other regional geographies and untapped markets would be the key
for industry AUM to grow. Gold loan industry AUM projection of the organized players is provided below:

Organized players are adopting marketing initiatives to raise awareness against heavy interest rates charged by
the unorganized players (which are in the range of 25-50%) especially in rural parts. Also, player’s ability to
leverage technology and improve their online gold disbursements could turn out to be a game changer. Along with
these drivers, a favourable economic scenario will further drive up the funding needs of small businesses, and

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hence, improve demand for gold loans. Based on these growth drivers, we expect gold loan NBFCs’ AUM to
grow at 9.1% CAGR, from INR812.4bn in FY20 to INR1,150.0bn in FY24P. Indian NBFC’s gold loan AUM
projection for the coming 4 years is provided below:

The overall organized NBFC’s gold loan penetration level is around 25-30%, which confirms that there is
headroom for growth in this market. So, financial institutions with the right focus, operational capabilities,
availability of funds, refreshing products and modern technology can capture a large market share.

Various factors affect the gold demand in India. The relationship between these factors is provided below:

Long Term Factors Short Term Factors

Rising Income Gold Price Movement Inflation Excess Rainfall

It is anticipated that for a 1% For a 1% increase in gold For a 1% increase in For a 1% increase in
increase in income, the price, demand will inflation, demand monsoon rainfall, gold
demand for gold will rise by 1% decrease by 0.5% rises by 2.6% demand rises by 0.5%
Source: World Gold Council

The arrival of new online gold loan products and digital models by various NBFCs and fintech players are
expected to tap the gold loan market. These products offer gold loans at the client’s doorstep and complete the
process without much hassle. More and more tech driven consumers are opting for these loans as these products
have lower interest rates vis-à-vis its competing brick and motor NBFCs.

Gold as a Hedge against Inflation, Fluctuation in Interest Rates and Rupee Devaluation

The Indian rupee has been deprecating against the US dollar over the months and touched a low of INR75.0 per
US dollar on 8th August 2020. It is further expected to depreciate as investor sentiment remained fragile amid
concerns over the impact of coronavirus outbreak. Higher inflation leads to increase in expenses and lesser savings
thereby affecting personal finances. Higher inflation over a period can cause higher interest rates, thereby making
loans expensive. A weak rupee against dollar affects any investment done abroad, foreign education and foreign
travel. The inflationary pressures have led to interest rate hike by RBI which has already raised interest rates twice
this year. A higher interest rate will lead to higher EMIs. For the investor of debt funds, rise in interest rates would
bring down the bond prices and hence has a negative impact on the debt funds ‘net asset values’. As explained
above, the rising exchange rates and the resulting inflationary pressures will have an impact on the value of the
assets of the retail investors and hence it is imperative for the retail investors to invest in class of assets which are
good inflation hedgers. Among all the class of assets, gold is considered as a best hedge against inflation and seen
as an ideal asset for portfolio diversification.

The demand for gold rises whenever there is political chaos and gold is considered as safe haven. A significant
reason why people invest in gold is that it has performed admirably in holding of value over the long-term in
comparison to other assets like paper currency, some coins or even stocks. Thus, gold can be used to protect
purchasing power, reduce volatility and minimize losses during periods of market shock.

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RBI is among the 10th largest holder of gold reserves among central banks globally, according to the latest WGC
report with USA and Germany among the top holders. Ever since uncertainty over the dollar outlook mounted
after the US-China trade war concerns in 2018, central banks across the globe started buying gold to diversify
their foreign exchange reserves base. RBI also started buying gold after a long gap (after Nov 2009). The surge
in foreign inflow and low yield on overseas sovereign bonds may have led to RBI buy gold. As at end September
2019, the RBI held 618.17 tonnes of gold, with 325.87 tonnes being held overseas in safe custody with the Bank
of England and the Bank for International Settlements, while the remaining gold is held domestically.

The RBI decision to buy gold is significant because unlike Central banks it does not regularly trade in gold
although the law permits it do so. The RBI’s decision to buy gold is probably a decision for diversification of
assets for deployment keeping in mind the evolving global risks due to rising policy rates in the USA and
increasing market volatility.

KEY CHALLENGES FACED BY THE GOLD LOAN INDUSTRY

Volatility in Gold prices

Volatility in the gold prices has impact on the performance of the gold loan market. Though gold prices are
increasing currently, it is expected to decrease over the long term. As per World Bank - Commodity Markets
Outlook, April 2020, the global prices of gold are expected to decline from USD1,583.3 per toz in 2020 to
USD1,503.0 per toz in 2025P. Average gold price in India has shot up by nearly 40.0% since the beginning of this
year amid volatile equity market and dwindling economic growth and following the impact of the COVID-19
pandemic. The sharp jump makes gold more vulnerable to price fluctuations in the near term. With increase in
LTV, the asset portfolio of gold finance companies become more vulnerable if gold price crash suddenly. This is
because the safety margin reduces with higher LTV. Banks would be exposed to greater risk due to higher LTV.

Regulatory pressure

At present, every NBFCs-ND-SI is required to make a provision for standard assets at 0.4% of the outstanding. In
March 2017, RBI stated that NBFCs cannot disburse more than INR20,000/- in cash against the gold loans. This
RBI move is being part of its go digital drive post demonetization. RBI has increased the maximum limit for LTV
for gold loans for scheduled commercial banks to 90.0% (earlier it was 75.0%) till March 2021 but it would be
further brought back to 75.0% post 31st March. The LTV is still 75.0% for NBFCs. The objective behind increasing
the LTV would be to provide some lending room for the lenders. The higher LTV ratio suggests more risk as the
assets behind the loan are less likely to pay off the loan once the LTV ratio increases. Due to this, NBFCs will
surely lose market share to banks in gold loan segment.

Security Threats and Risks of Theft

One of the principal risks in the operations of gold loan NBFCs are robbery and employee theft or fraud which
needs to be safeguarded. To safeguard against theft or loss of collateralized gold NBFCs install safe vaults, in-
house or outsourced storage model, electronic surveillance, internal and external audits and insurance.

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Lack of financial literacy among rural customers

The customer segment living in remote areas is financially illiterate and till date they are under the impression
that they are not eligible for any loans from the organized (banks, NBFCs, financial institutions) sector and they
approach local moneylenders. This financial illiteracy among rural people is a factor that hampers the growth of
market to a great extent.

Young Indians attraction to alternative jewellery

India is the largest consumer of gold in the world. From last few years the young population of India is more
inclined towards high-end designer and gem-set jewellery with a preference to platinum and diamonds. This
indicates buying patterns are shifting and the demand for plain gold jewellery is declining especially in the urban
areas. As per industry reports, India is the world’s fourth largest platinum market and customers have the assurance
of buy-back similar to gold ornaments. In recent times, diamonds are also gaining equal popularity to gold as an
investment option. Further, the Indian Commodity Exchange is offering a Systematic Investment Plan to acquire
precious stones for retail buyers. Since, the last seven years, gold and platinum have appreciated by a similar
extent. All these are indicators of slightly diminishing popularity of gold amongst the urban youth in urban
markets.

Change in Savings Pattern

The youth are turning towards alternative options such as equity markets/mutual funds for wealth creation as
against traditional method of buying gold. Also, the percentage of discretionary spending is also rising day by
day. These alternate investment options are gaining more traction.

Data Security

Protection of data is the most importance given to the rise of cyberattacks through malware and phishing targeted
at the confidential client information. All the financial institutions need to make sure that sufficient attention is
given to such challenges and a strong network and data infrastructure is in place which would be capable of
preventing such attacks.

According to industry sources, cyber-crime is the third most reported fraud across the financial sector. The RBI
directed that all NBFCs were required to have a board-approved information security policy with the following
basic tenets:

(a) Confidentiality - Ensuring access to sensitive data to authorized users only

(b) Integrity - Ensuring accuracy and reliability of information by ensuring that there is no modification without
authorization.

(c) Availability - Ensuring that uninterrupted data is available to users when it is needed.

(d) Authenticity - For information security it is necessary to ensure that the data, transactions, communications
or documents (electronic or physical) are genuine.

GOLD LOAN INDUSTRY DURING COVID-19 CRISIS

During periods of economic stress, banks can really become risk averse and gold will offer on lending. The global
financial crisis happened in 2008-09 when major economies went into recession and stock markets crashed. But
unlike the financial crisis, challenges are different this time. The COVID-19 pandemic is a medical problem and
the remedy of this problem also lies in the realm of medical sciences. Monetary and fiscal measures extensively
used across the globe at best will only help in mitigating some of the adverse impact on the economy. Therefore,
it is now evident that the impact of COVID-19 on the economy and livelihood is going to be greater than the
impact of both GFC and SMC.

The economic package of INR20.0tn to revive Indian economy which includes the loan guarantee scheme of
INR750.0bn for NBFCs and the MFIs would help in easing the liquidity challenges faced by the NBFCs. Both
the government and RBI are fully committed to do whatever it takes in addressing the challenges of the pandemic.

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Unlike other segment like house finance, commercial vehicle finance and MFIs, leading NBFCs have kept
momentum going in gold loan by focusing on online channels. Leading NBFC is expecting 10.0% growth on gold
loans in FY21 while other segments do not expect any growth. The application for gold loans have increased
30.0%-35.0% during July 2020. Gold loans were disbursed online when branches were closed during lockdown
period. Due to this, even during the lockdown period itself, the online gold loan out of the total portfolio has gone
up. Online channels are helping NBFCs in the interest collection and customer find it easy to transfer online
whenever they have some money in their accounts. Online gold loan brings a lot of cost savings to NBFCs, but it
will be accrued only in future because there are minimal number of people in the branch. Even if portfolio grows
3x to 4x, NBFCs do not need any additional employees. In future, this is going to bring a lot of operating
expenditure saving per branch. Online gold disbursement would prove as competitive advantage to NBFCs who
will proactively consider it as a vital business strategy in coming years.

NBFCs are expecting increase in gold loans as benefits like free storage of gold and drawing power up to 75.0%
of the LTV can be done anytime from anywhere. At the portfolio level, most of the NBFCs have average LTV at
around 60.0% against recent increase of RBI limit. It creates lot of room to borrow more against their excessive
ledgers by most of the customers. But recent RBI circular of LTV increase from 75.0% to 90.0% for only
scheduled commercial banks will lead to market share gain by the banks in near term.

Unlike MFIs loans, most of the gold loan customers have preferred not to opt for loan moratorium as they realize
the deferment of payments without the waiver of interest would add to their interest outflow. One of major reason
for this is the nature of gold loan offered by NBFCs. It is bullet repayment loans and loan moratorium are
applicable to term loans. The current overall bounce rate of the customers is around 40.0% to 50.0% during
lockdown. But NBFCs were able to collect almost all interest on gold loan. That is why, there is not much
difference between approvals pre COVID-19 and present for gold loans. But for other segments, normal rate of
disbursement for the NBFCs will start once the collection percentage gets back to normal.

Gold loans can turn the tide due to innovative products like online gold loans, being liquid and secured in nature
and increase in gold prices during the period. But on the other hand, increase in LTV to 90.0% for only scheduled
commercial banks will lead to market share loss of these NBFCs. Though higher LTV ratio suggests more risk
because the assets behind the loan are less likely to pay off the loan as the LTV ratio increases. But increased gold
loan application during this period would have provided healthy business opportunity when other segments are
struggling even if the risk is higher with higher chances of gold price volatility in near term providing lower safety
margins to lenders.

OVERVIEW OF MICRO FINANCE INDUSTRY IN INDIA

Microfinance, which involves providing small loans to financially excluded rural market, is an important player
to bridge the credit demand gap among the underserved lower income groups. The journey of financial inclusion
in the past two decades has been one of intensive efforts and incremental experimentation. However, the quantum
jump came when Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched in 2014, which enabled achievement
of the objective of providing bank accounts to adult population in almost every household. The reach of mobile
phones and e-KYC has ensured these accounts are accessible to those who have been included in the financial
services.

Number of negative events in the past have influenced growth as well as asset quality of the microfinance sector
including – the AP crisis of October 2010, farm loan waivers by several states, demonetisation in November 2016,
floods in some states, as well as recent economic slowdown. Despite these setbacks, the industry has evolved over
the cycles and demonstrated resilience by adapting to changing dynamics. It is significant to note that both the
number of institutions providing microfinance as also the quantum of credit made available to the financially
excluded clients have increased significantly during the last decade. RBI has been making sustained efforts to
increase the penetration of formal financial services in unbanked areas, while continuing with its policy of
ensuring adequate flow of credit to productive sectors of the economy and also ensuring the availability of banking
services to all sections of people in the country.

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MFI consists of multiple players with diverse organizational structures. Loans in this sector are provided by banks,
small finance banks (SFBs), non-banking financial company-microfinance institutions (NBFC-MFIs), other
NBFCs and non-profit organizations. According to the Bharat Microfinance Report 2019 prepared by Sa-Dhan,
MFIs operate in 29 States, 5 Union Territories and 570 districts in India. The MFIs are also expanding into newer
territories for reducing their concentration risk. Industry reports state that Microfinance industry has total loan
portfolio of INR2,321.2bn in FY20 which represents a growth of 30% over the loan portfolio of INR1,785.5bn in
FY19. The industry portfolio has grown at a CAGR of 28.7% during FY16 to FY20 period.

The pie charts given beside provide the % share by each player in the microfinance loan portfolio outstanding
during FY20.

Industry reports state that till December 2019, Loan disbursal grew by 10% from Q3 FY19 to Q3 FY20 in terms
of volume. All India Average Ticket Size (ATS) as of December 2019 is INR34,880.0. ATS of bank loans is
highest at INR40,740.0 whereas ATS of NBFC-MFIs is lowest at INR28,719. Highest number of loans are
disbursed in INR20,000.0 to INR30,000.0 ticket size category. In terms of regional distribution of portfolio; East
and North East accounts for 40%, South accounts for 28%, North holds 10%, West has a share of 14% and Central
contributes 8%. The Top 9 states constitute more than 70.0% in terms of the micro finance loan portfolio. Tamil
Nadu is the largest state followed by West Bengal and Bihar.

Over the past years, the GoI and the RBI has recognized the role played by MFIs in furthering government’s
financial inclusion agenda. As a part of strengthening the MFI, the RBI appointed industry body Micro Finance
Institutions Network (MFIN) as well as Sa-Dhan (an association of MFIN) as self-regulatory organizations
(SROs) and bringing Credit Bureau for the tiny loan segments. There has been a tremendous improvement in the
risk management practices of MFIs which is evident that the sector was able to tide over the effects of
demonetization despite being the fact that MFIs transactions with its customers are mainly in cash as they cater to
low income households with majority of them located in rural areas. NBFC-MFIs are increasingly adopting digital
transactions and expecting disbursements and repayment to happen cashless. However, their customers are
illiterate, and the adoption is low by the customers. Digitalization will happen only with the improvement in digital
infrastructure and with a continuous engagement with their customers. This is possible as the MFI feet on the
street model has been instrumental in building an extensive reach at the grass-root level thereby enabling MFI to

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cater to the financial needs of the unbanked clients. RBI has also raised the household income limit for availing
micro loans while enhanced the lending limit to INR1.25 lakh per eligible borrower from INR1.0 lakh earlier,
creating more opportunity for MFIs to grow.

The NBFC-MFIs adhere to RBI guidelines to fix interest rates. As NBFC-MFIs are non-deposit taking entities
they borrow funds from external sources to cater to the micro-credit requirements of their clients. The interest
rates what NBFC-MFI are heavily dependent on the cost of funds that it borrows and RBI stipulations. Over the
years, the average cost of funds for MFI has come down and many of the MFI have started passing on the benefits
of the reduction in the cost of funds to their clients by charging lower interest rate to their client. RBI set an
average base rate of 9.18% for non-banking financial companies and micro finance institutions to be charged from
their customers for the quarter beginning July 2019.

A significant portion of the Indian population still lacks access to credit from the formal sector and consequently
borrows from informal channels like moneylenders or relatives, indicating the scope of micro lending in achieving
financial inclusion and overall industry growth. The prospective for Microfinance, particularly in Semi-Urban and
Rural geography is quite large in India and with NBFC-MFIs are stepping up to integrate best practices and
technology which would help them provide better customer service as well as achieve operational efficiencies and
lower costs.

CHALLENGES FACED BY MFIS AND SFBS DUE TO COVID-19

MFIs and small finance banks (SFBs) will face severe asset quality issues in the short term, as near-term
collections would see unprecedented disruptions. There may be refinancing and funding challenges for entities in
the next 3-6 months. MFIs would be among the severely impacted primarily due to the operational challenges to
collect cash because of the lockdown. The April 2020 collections were almost negligible with dim prospects of
recovery in May 2020 when the lockdown continued with limited relaxations. Additionally, the credit costs could
exceed pre-provision operating profits (4%-6% for NBFC-MFIs) with likely erosion in capital.

It could take much longer for the credit support to normalise. Domestic banks may curtail funding/refinancing to
MFIs for the short-to-medium term, given the uncertainty towards inflows. While the RBI has announced Targeted
Long-Term Repo Operation (TLTRO 2.0) of INR500bn for NBFCs, half of which is targeted for small and mid-
sized NBFCs and MFIs, the banks’ appetite to flow the same remains uncertain. The TLTRO 2.0 scheme mandates
that within the total size of INR500 bn, 10.0% should be allocated to MFIs, 15.0% to NBFCs with asset size of
INR5.0 billion and below and 25.0% to NBFCs with assets size between INR5.0bn and INR50.0bn and rated in
the investment grade.

Asset Class-wise Vulnerabilities

Source: India Ratings & Research

Ind-Ra expects that the banks would face delinquencies and challenges on the asset front. This would hamper
deposit accretion at least for the next 3-6 months. Ind-Ra also expects that SFBs exposed to MFIs to have an
overhang on deposit accrual and deposit rollover/renewal. However, they do have access to refinance institutions
and, as banks, to additional tools to raise non-deposit liabilities to manage their asset-liability management.

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As per industry reports, 70.0% of the MFI industry found a liquidity shortfall of INR26.0bn. On a collective basis,
total repayment obligations and operational expenditure is around INR80.0bn in Q1 FY21 while the on-balance
sheet liquidity buffer stood at around INR54.0bn. As the collections from borrowers will take some time after the
lockdown, the industry stares at liquidity challenges. As per estimates, the shortfall of around INR26.0bn in the
absence of any external funding support by way of equity/additional debt or extension of the moratorium. It is
expected that MFI credit costs to at least double from the present levels of 1-1.5% to 2.5-3% for most players,
which is likely to impact their return on equity by 3-5% in FY21. The impact on credit costs could be even higher
if there is a permanent loss of livelihood or a significant decline in income for a proportion of the borrowers,
thereby impacting their repayment capacity.

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OUR BUSINESS

Unless otherwise stated or the context requires otherwise, references in this section to “we”, “us” or “our” refers
to Muthoottu Mini Financiers Limited.

Some of the information in the following section, specifically the information in relation to our plans and
strategies, contain certain forward looking statements that involve risks and uncertainties. You should read
“Forward Looking Statements” on page 14 for a discussion of risks and uncertainties related to those statements
and also “Risk Factors” on page 16, for a discussion of certain factors that may affect our business, financial
condition or results of operations. Our actual results may differ materially from those expressed in or implied by
these forward-looking statements.

Unless otherwise stated or the context otherwise requires, the financial information used in this section is derived
from our Audited Ind AS Financial Statement and Reformatted Financial Statements, included in this Prospectus
on page 118. We have included various operational and financial performance indicators in this section, some of
which may not have been derived from our Audited Ind AS Financial Statement and Reformatted Financial
Statements and which may not have been subject to an audit or review of the Statutory Auditor. The manner in
which such operational and financial indicators are calculated and presented, and the assumptions and estimates
used in the calculation, may vary from that used by other entities in the business similar to ours. You should
consult your own advisors and evaluate such information in the context of the Audited Ind AS Financial Statement
and Reformatted Financial Statements and other information relating to our business and operations included in
this Prospectus.

Unless otherwise indicated, industry and market data used in this section has been derived from industry
publications and other publicly available information, including, in particular the report titled “Gold Loan
Industry in India”, dated August 9, 2020, prepared and issued by IRR Advisory Services Private Limited.

Overview

We are a non-deposit taking systemically important NBFC in the gold loan sector lending money against the
pledge of household gold jewellery (“Gold Loans”) in the state of Kerala, Tamil Nadu, Karnataka, Andhra
Pradesh, Telangana, Haryana, Maharashtra, Delhi and Goa and the union territory of Puducherry. We also have
microfinance loan segment wherein we provide unsecured loans to joint liability group of women customers
(minimum of 5 persons) who require funds to carry out their business activities through few of our branches in
the state of Kerala. Our Gold Loan portfolio as on March 31, 2020, March 31, 2019 and March 31, 2018 comprises
of 4,37,182, 3,75,665 and 4,11,558 Gold Loan accounts respectively, aggregating to `1,64,480.28 lakhs,
`1,35,012.97 lakhs and `1,55,432.83 lakhs which is 97.26%, 97.50% and 95.31% of our total loans and advances
as on such specific dates. We, as on June 30, 2020, had a network of 785 branches spread in the states of Kerala,
Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Haryana, Maharashtra, Delhi and Goa and the union territory
of Puducherry and we employ 3,109 persons in our business operations.

We are registered with RBI as a non-deposit taking, systemically important, NBFC (registration no. N-16.00175
dated April 13, 2002) under Section 45 IA of the Reserve Bank of India Act, 1934. Further, a fresh certificate of
registration was issued by RBI on January 1, 2014, pursuant to the change of name of our Company from
‘Muthoottu Mini Financiers Private Limited’ to ‘Muthoottu Mini Financiers Limited’. Our Company has also
obtained a certificate of registration bearing registration no. – CA0122 issued by IRDAI, with effect from April
1, 2016 (renewed w.e.f April 1, 2019), under Section 42D (1) of the Insurance Act, to act as a “Corporate Agent
(Composite)”. Further, our Company holds a certificate of registration dated July 5, 2012 registration number IN–
DP–CDSL–660- 2012 issued by SEBI to act as Depository Participant in terms of Regulation 20 of the Securities
and Exchange Board of India (Depositories and Participants) Regulations, 1996, as renewed of August 21, 2017.

We are registered in the state of Kerala. Mathew Muthoottu, one of the Promoters, is the Managing Director of
our Company and Nizzy Mathew, mother of Mathew Muthoottu who is also the Chairman and Wholetime Director
of our Company, is the other Promoter of our Company.

Our Company belongs to the Muthoottu Mini group. Muthoottu Mini group belongs to the Muthoottu family of
Kozhencherry, which was founded by Ninan Mathai Muthoottu, who started the family business enterprise in
1887. In 1939, three sons of Ninan M. Muthoottu, viz, M. George Muthoot, M. Mathew and M. Pappachan
Muthoot started a finance company named as Muthoot M. George & Brothers (“MGB”). In the early 1970s, they
separated their business enterprises into three groups i.e. the current Muthoot Finance group of companies which

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is controlled by the sons of George M. Muthoot, the Muthoot Fincorp group which is controlled by the sons of M.
Pappachan Muthoot and the Muthoottu Mini group which was earlier controlled by the son of M. Mathew i.e. Roy
M. Muthoottu. Muthoottu Mini group is presently controlled by Mathew Muthoottu, son of Roy M. Muthoottu.
Other than the aforementioned family connection, all the groups are distinct from each other and none of them are
having any inter-group shareholdings or controls or business dealings. The Muthoottu Mini group commenced
operations at Kozhencherry, Pathanamthitta, Kerala and has over three decades of established history in the money
lending business, mainly in small scale money lending against used household gold jewellery. The Muthoottu
Mini group has been in the gold loan financing since 1986 and our Company has been extending Gold Loans since
its incorporation.

Our Gold Loan customers are individuals primarily from rural and semi-urban areas. We believe that what
distinguishes us from banks is our focus on non-organized sections of society and our turnaround time. For the
Fiscals 2020, 2019 and 2018, the average loan amount advanced by us was `37,623, `35,940 and `37,767 per
loan transaction. Our Gold Loan product mix varies from 30 days upto 270 days tenure with varying rates of
interest and amount of loan to suit the requirements of the customers. For the Fiscals 2020, 2019 and 2018 our
yield on Gold Loan assets was 19.70%, 19.17% and 18.18% respectively.

We have also introduced online gold loan product wherein the customer has to come to the branch only for the
initial appraisal and subsequent disbursement are done online whenever the customer makes a request during the
maximum period of one year, subject to the prevailing LTV norms.

We focus on rapid, on the spot approval and disbursement of loans with minimal procedural formalities which
our customers need to complete in order to avail a loan from us. We have developed various Gold Loan schemes,
which offer variable terms in relation to the amount advanced per gram of gold, the interest rate and the amount
of the loan, to meet the different needs of various customers.

Our lending functions are supported by a custom developed information technology platform that allows us to,
record relevant customer details, approve and disburse the loan. Our web based centralised IT platform which
records details of all branches also handles management of the relevant loan and pledged gold related information

Our microfinance loan customers are joint liability group of woman customers only (minimum of 5 persons) from
rural and semi-urban areas of Kerala. Our microfinance loan portfolio as on March 31, 2020, March 31, 2019 and
March 31, 2018 comprised of 19,632, 25,749 and 32,735 microfinance loan accounts respectively, aggregating to
`4,537.76 lakhs, `3,215.18 lakhs and `7,240.57 lakhs which is 2.68%, 2.32% and 4.44% of our total loans and
advances as on such specific dates. For the Fiscals ended 2020, 2019 and 2018 the average loan amount advanced
by us was `23,114, `12,487 and `22,119 per loan transaction. For the Fiscals ended March 31, 2020, March 31,
2019 and March 31, 2018, our yield on microfinance loan assets was 25.04%, 25.91% and 20.63% respectively.

In addition to the loan business, we also offer depository participant services, money transfer services, insurance
broking services, PAN card related services and travel agency services.

For the Fiscals 2020, 2019 and 2018, our total revenue was `31,315.27 lakhs, `29,815.48 lakhs and `33,493.39
lakhs, respectively. Our profit after tax, for the Fiscals 2020, 2019 and 2018, was `3,354.18 lakhs, `2,095.60 lakhs
and `1,424.59 lakhs, respectively. For the Fiscals 2020, 2019 and 2018, our income from our Gold Loan business
constituted 94.60%, 93.37% and 94.85% respectively, of our total income. For the Fiscals 2020, 2019 and 2018,
revenues from our microfinance loan business constituted 3.10%, 4.54% and 2.46%, respectively, of our total
income.

Gross non-performing loan assets were 1.89%, 2.16% and 2.09% of our gross loan portfolio under management
for the Fiscals 2020, 2019 and 2018, respectively.

Key Operational and Financial indicators of our Company

A summary of our key operational and financial indicators for the Fiscal 2020 have been derived from Audited
Ind AS Financial Statement prepared in accordance with IND AS1 and for the last two Fiscals 2019 and 2018,
have been derived from Reformatted Financial Information prepared in accordance with IGAAP are as follows:

A summary of our key operational and financial parameters for Fiscal 2020, are as follows:

(` in lakhs except percentage)

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Parameters Fiscal 2020

Equity 47,810.32
Total Borrowings of which
-Debt securities (including interest accrued but excluding unamortized expense of 87,589.94
public issues)7
-Borrowings (other than debt securities) 36,543.85
-Subordinated Liabilities 28,690.84
Property, Plant and Equipment and Other Intangible assets 19,011.76
Financial assets2 1,79,973.38
Non-financial assets3 22,591.35
Cash and cash equivalents including bank balances 10,201.67
Financial liabilities4 1,54,128.91
Non-financial liabilities5 275.50
Assets under Management6 1,69,109.97
Contingent Liability 607.19
Interest Income 30,093.68
Finance Costs 16,548.85
Impairment on financial instruments (65.23)
Profit after Tax (PAT) 3,354.18
Total Comprehensive Income 3,342.20
Gross NPA as % of Loan assets * 1.89%
Net NPA as % of Loan Assets ** 1.34%
CRAR - Tier I Capital Ratio (%) 24.57%
CRAR - Tier II Capital Ratio (%) 5.08%
* Gross NPA % = Gross NPA / (Assets Under Management)
** Net NPA % = (Gross NPA – Provisions for NPA) / (Assets Under Management– Provisions for NPA)

Notes:
1. The Company has adopted Ind AS notified under Section 133 of the Companies Act read with the Companies (Indian
Accounting Standards) Rules, 2015 as amended, from April 1, 2019 and the effective date of such transition is April 1, 2018.
Such transition has been carried out from the erstwhile Accounting Standards notified under the Companies Act. Accordingly,
the impact of transition has been recorded in the opening reserves as at April 1, 2018 and the corresponding figures, presented
in these results, have been restated/ reclassified. Therefore, the Financial Information on March 31, 2020 is not comparable
with previous years Financial Information.
2. Financial assets includes cash and cash equivalents, bank balance other than cash and cash equivalents, loans, investments
and other financial assets.
3. Non-Financial assets includes current tax assets, deferred tax assets, property plant and equipment, intangible assets and
other non-financial assets
[Link] liabilities includes debt securities, borrowings (other than debt securities), deposits, subordinated liabilities and
other financial liabilities.
5. Non-Financial liabilities include provisions and other non-financial liabilities.
6. “Asset under Management” refers to gross loans including interest receivable without considering the impact of impairment
loss allowance and effective interest rate.
7. Debt Securities does not include unclaimed matured debentures and interest thereon amounting to ` 353.57 Lakhs.

A summary of our key operational and financial parameters for the last two Fiscals 2019 and 2018, are as follows:

(`in lakhs except percentage)

Parameters Fiscal 2019 Fiscal 2018
Net worth 44,280.10 42,193.84
Total debt 1,10,155.73 1,24,706.28
• Non-current maturity of long term debt 46,801.06 56,809.60

• Short term debt 35,510.20 37,795.19

• Current maturity of long term debt 27,844.47 30,101.49
Net fixed assets 19,443.07 20,202.82
Non-current assets 22,326.66 22,919.67
Cash and cash equivalents 8,342.95 10,212.30
Current investment - -
Current assets 1,61,269.14 1,75,430.71
Current liability 74,027.31 80,591.57

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Parameters Fiscal 2019 Fiscal 2018

Assets under management 1,38,472.95 1,63,078.52
Off balance sheet assets - -
Contingent Liability 1,111.87 1,224.51
Interest income 29,453.05 32,951.83
Interest expenses 16,461.05 19,493.31
Provisioning and write-offs 286.65 (36.53)
Profit after Tax (PAT) 2,095.60 1,424.59
Gross NPA 2.16% 2.09%
Net NPA 1.39% 1.58%
Tier I Capital Adequacy Ratio (%) 25.11% 22.33%
Tier II Capital Adequacy Ratio (%) 9.74% 11.58%

The debt equity ratio of our Company as on March 31, 2020 is as follows:

Parameters
Debt before Issue of the debt securities 3.20
Debt after of the debt securities 3.61

Note 1: The debt equity ratio post issue is indicative and is on account of inflow of ` 20,000 lakhs from the proposed public
issue.
Note 2: The debt equity ratio pre-issue is calculated based on the Audited Financial Statements as on March 31, 2020.
Note 3: The following events that occurred after March 31, 2020 may have an impact on the above calculation:
1. The Company has raised secured non-convertible debenture amounting to `19,790.67Lakhs through public issue during
April 1, 2020 - July 31, 2020impact of which is not provided in the above table.
2. The Company has raised funds through Subordinated Debt amounting to ` 2,772.88 Lakhs during April 1, 2020 - July
31, 2020 impact of which is not provided in the above table.
3. The Company during April 1, 2020 – July 31, 2020 redeemed secured privately placed non-convertible debenture
amounting to ` 120.00 lakhs and unsecured privately place non-convertible debenture amounting to ` 245.00 lakhs impact
of which is not provided in the above table.
4. The Company during April 1, 2020 – July 31, 2020 has redeemed unsecured public issue of non-convertible debenture
amounting to ` 7,143.37 lakhs impact of which is not provided in the above table.

Our Strengths

We feel that the following competitive strengths position us well for continued growth:

We are a non-deposit taking systemically important NBFC in the Gold Loan sector in South India with a long
operating history and large customer base.

We are registered with RBI as a non-deposit taking, systemically important, NBFC (registration no. N-16.00175
dated April 13, 2002) under Section 45 IA of the Reserve Bank of India Act, 1934. Further, a fresh certificate of
registration was issued by RBI on January 1, 2014, pursuant to the change of name of our Company from
‘Muthoottu Mini Financiers Private Limited’ to ‘Muthoottu Mini Financiers Limited’. We operate, since our
incorporation, in the gold loan sector lending money against the pledge of household gold jewellery (“Gold
Loans”) in the state of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Haryana, Maharashtra, Delhi
and Goa and the union territory of Puducherry. We believe that we have, over the years, been successful in
expanding our brand name, as well as our customer base to different geographical locations in India. As on June
30, 2020, we have a network of 785 branches spread in the states of Kerala, Tamil Nadu, Karnataka, Andhra
Pradesh, Telangana, Haryana, Maharashtra, Delhi and Goa and the union territory of Puducherry. Our total
number of Gold Loan accounts were 3,62,962 customer accounts as of June 30, 2020. We attribute our growth, in
part, to our market penetration, particularly in areas which we believe are less served by organized lending
institutions, which is reflected in the majority of our branches are located in rural and semi-urban areas as of June
30, 2020 and streamlined procedural formalities which our customers need to complete in order to complete a
loan transaction with us, which we believe enables us to attract new and retain existing customers. We also
attribute our growth to customer loyalty and believe that our customers return to us when they are in need of funds.

Flexible loan schemes and efficient customer service

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We believe the growth in our Gold Loan portfolio is partly due to the flexible Gold Loan schemes that we offer
to our customers and efficient customer service. Depending on the individual needs, we provide our customers
multiple options with respect to the loan amount, advance rate per gram of gold and interest rate. We endeavour
to provide our customers with a simple and transparent process to avail Gold Loans and other services with trained
staff members at all our branch locations. We also endeavour to staff our branches with persons belonging to the
same locality as our customers which enables us to know our customers and their specific requirements better and
enables us to meet up to their expectations in an efficient manner. We believe that our technology support, skilled
workforce and policies on internal processes enable us to achieve the above objective. Furthermore, since our
Gold loans are all collateralized by gold jewellery, there are minimal documentary and credit assessment
requirements, which shorten our turnaround time.

Extensive branch network across rural and semi-urban areas in South India

As of June 30, 2020, we have 785 branches spread across the states of Kerala, Karnataka, Tamil Nadu, Andhra
Pradesh, Telangana, Haryana, Maharashtra, Delhi and Goa and the union territory of Puducherry. For further
details, please refer to “Our Business – Branch Network” on page 98. About 62% of our branches are in rural and
semi-urban areas in South India.

Advanced technology systems and established processes

We believe that the usage of a technology platform across our operations has improved our growth. Our web based
centralised IT platform which records details of all branches. We believe that our IT infrastructure helps us with
real time data transmission and updates, and endeavour to minimise errors, ensure faster data transmission and
risk monitoring. We upload data at each branch to facilitate online information access for faster decision making.
Our technology also helps reduce the time it takes to complete Gold Loan / micro finance loan transactions.

Our Company has put in place well defined and efficient process that enables us to achieve uniformity in our
operations across all our branches. Our processes are developed at the Corporate Office level by professionals
who have extensive experience in the areas of banking and financial services with supervision from our
management. We believe that such well-defined processes and efficient technology platform, enables us to keep
a better check over our entire branch network and helps us in detecting shortcomings.

Strong support system, including appraisal, internal audit and inventory control and safety systems

We believe that our ability to appraise the quality of the gold jewellery to be pledged in a short period of time is
critical to our business. Assessing the gold jewellery quickly and accurately is a specialized skill that involves an
assessment for gold content and quality manually without damaging the jewellery. We undertake the assessment
activity in-house using tested methods of appraisal of gold.

Once the Gold Loan is made, we have a system in place for continuous monitoring of the pledged gold by internal
audit and risk management teams. In accordance with our internal audit policy, all of our branches are subject to
inspection for once in three months depending upon management perception of the risk associated with the branch.
High value Gold Loans of ticket size of `5 lakh and above are subject to the prior approval of the Regional
Managers. The Regional Managers can approve Gold Loans to individual borrowers upto `25 lakhs, subject to
strict compliance with quality as well as LTV criteria. Gold Loans to individual borrowers above the value of `25
lakhs shall be subject to the prior approval of the Regional Head Officer and the Gold Loans above of `50 lakhs
shall be approved by the operations head at the Corporate Office with recommendation of the Regional head
officer. At the time of conducting an inspection, a quality check on the inventory is also carried out, which involves
physical security checks and checks on the quality of pledged gold. All our branches are fitted with strong rooms
which are reinforced concrete cement structures built per industry standards and practices and fitted with security
cameras to ensure high level of security.

Experienced management team and skilled personnel

Our Promoters, Nizzy Mathew has over 20 years of experience and Mathew Muthoottu has over five years of
experience in our business. Our senior management teams have extensive experience in the areas of banking and
financial services, and we believe that their considerable knowledge of and experience in the industry enhances
our ability to operate effectively. Our staff, including professionals, covers a variety of disciplines, including
internal audit, technology, accounting, marketing and sales. Our workforce also consists of appraisers who are
skilled in the evaluation of the worth and authenticity of the gold that is pledged with us.

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Our Strategies

Our business strategy is designed to capitalize on our competitive strengths and enhance our leadership position
in the Gold Loan industry and to expand our presence in micro finance loan segment. Key elements of our
strategies include:

Further growth in Gold Loan business in rural and semi-urban markets to tap into the potentially large market
for Gold Loans

Indian gold loan market expanded considerably in recent years. The recent developments in the gold loan market
have both positive and negative implications. In a country, where loans are required to be raised for meeting some
sudden medical exigency or an educational loan or a business loan by a small and medium enterprise owner, the
gold loans extended by the NBFCs are very handy and flexible, though costlier than such loans disbursed by
banks. At a time, when financial inclusion is a major policy goal, the services rendered by the gold loans NBFCs,
which are a part of the organised loan market are contributing in a reasonable measure to cater to the borrowing
requirements of a needy section of the society, gold is an idle asset in the hands of individuals and there is a huge
unlocked economic value in the Indian economy, which is estimated to be around 23,000-24,000 tonnes of gold.
(Source: NITI Aayog – Transforming India’s Gold Market Feb 2018) Just a small fraction of this idle gold stock
is being used for raising gold loans.

We intend to increase our presence in rural and semi-urban markets, where a large portion of the population has
limited access to credit either because they do not meet the eligibility requirements of banks or financial
institutions, or because credit is not available in a timely manner at reasonable rates of interest, or at all. We
believe we meet the expectation of a typical Gold Loan customer of high loan-to-value ratios, rapid and accurate
appraisals, easy access, low levels of documentation, quick approval and disbursement and safekeeping of their
pledged gold, and thus our focus is to expand our Gold Loan business. We believe that our brand is key to the
growth of our business. We believe that we have built a recognizable brand in the rural and semi-urban markets
of India, particularly in the southern states of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh and Telangana.

Diversifying our business into micro finance loan segment

We offer micro finance loans which are targeted to economically active, married women, having regular cash flow
from certain income generating activities, including but not limited to, self-managed business, vegetable vendors
and tailoring business. As on June 30, 2020, we are offering micro finance loan only through 67 branches in the
state of Kerala. Going forward, we intend to increase the number of branches in Kerala and expand it to other
southern states. For the Financial Years ended March 31, 2020, March 31, 2019 and March 31, 2018, our micro
finance loan represented 2.68%, 2.32% and 4.44% of our total assets under management as on that dates. We
believe that our diverse revenue stream will reduce our dependence on any particular product line thus enabling
us to spread and mitigate our risk exposure to any particular industry, business and geography or customer
segment.

Undertaking new business initiatives to diversify our revenue stream by leveraging our branch network and
customer base

Gold Loan and micro finance loan as on March 31, 2020 account for 97.26% and 2.68% of total loans of our
Company, respectively. These contribute to over 97.70% of our total revenues, making us dependent on such
income stream and interest on loans. With a view to diversify our incomes and be less dependent on interest alone,
we continue to increase our revenue by broadening our fee based income by selling third party products. We
currently provide services like money transfer, insurance, DP services, PAN card related services and travel
agency services. Our Company has obtained registration with the IRDAI, to act as a corporate agent for procuring
and soliciting insurance business both in the life insurance and general insurance category. The license no.
CA0122 was assigned to our Company and is valid till March 31, 2022. Pursuant to such registration, we have
entered into corporate agency agreements with various insurance providers of life, health and general insurance
products for soliciting and procuring business for such insurance providers. We have also entered into agreements
with securities provider for carrying out online trading in equity and derivative and commodity segments using
our Depository Participant platform. Our Company intends to capitalise on the huge client base and large branch
network, to offer these additional products and services.

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Strengthening our risk management and technology systems to have an error less streamlined growth in
business

We believe that the risk management is a crucial element for the expansion of our Gold Loan / micro finance loan
businesses. We believe that our integrated risk management framework with processes for identifying, measuring,
monitoring, reporting and mitigating key risks, including credit risk, appraisal risk, custodial risk, market risk and
operational risk helps us to strengthen our risk management systems. We believe that prudent risk management
policies and development of tailored credit procedures will allow us to expand our Gold Loan financing and micro
financing loan business without experiencing significant increases in non-performing assets.

We are focused on improving our comprehensive knowledge base and customer profile and support systems,
which in turn will assist us in the expansion of our business. We are also looking to revamp our IT infrastructure
to address the current deficiencies in our current IT systems which will help us improve our MIS systems.

GOLD LOAN BUSINESS

Our core business is disbursement of Gold Loans secured by the pledge of household gold jewellery. Loan
amounts advanced by us are typically within the range of `10,000 to `50,000 per loan transaction and typically
remain outstanding approximately for an average tenor of 90 to 270 days. For the Fiscals March 31, 2020, March
31, 2019 and March 31, 2018, we had 4,37,182, 3,75,665 and 4,11,558 Gold Loan accounts, aggregating to
balance of `1,64,480.28 lakhs, `1,35,012.97 lakhs and `1,55,432.83 lakhs, respectively. For the Fiscals 2020,
2019 and 2018, our Gold Loan portfolio yield representing interest income on Gold Loans as a percentage of
average outstanding of Gold Loans, for the same period were 19.70%, 19.17% and 18.18%. respectively, per
annum. For the Fiscals 2020, 2019 and 2018, income from interest earned on our Gold Loans constituted 94.60%,
93.37% and 94.85%, respectively, of our total income. We are able to offer a variety of Gold Loan schemes to our
customers to suit their individual needs. As of June 30, 2020, we have various new and different schemes in place.
The schemes differ in relation to the amount advanced per evaluated gram of gold, the interest rate concessions
offered for the particular tenor and the amount of the loan.

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Gold Loan disbursement process

Pre-Disbursement Stage Post- Disbursement Stage and release of Pledge

Customer walks into the Release of Pledge

Branch for gold loan Gold loan is disbursed

Ornaments and
KYC check undertaken Appraisal certificate Customer defaults on
Customer repays
at the Branch sealed as per approved payment
the loan and
policy put is strong
discharges the
room
Pledge form

Issue Notices to the

Customer
Appraiser conducts
specific weight and Once payment is made Ornaments
quality tests of the gold the Ornaments and retrieved from
Pledge form handed strong room and
over to the manager handed over to the
customer upon Initiate recovery
repayment proceeding

Customer is explained
the various schemes
and selects one Pledge form handed
over to cashier for
payment

Details entered into the Manager does the

computer and pledge verification and
form is printed sanctions the loan at
prescribed advance
rate

The principal form of security that we accept is household gold jewellery. We do not accept bullion, gold biscuits,
gold bars, new mass produced gold jewellery or medallions, and we restrict acceptance of jewellery from other
money lenders. While these restrictions narrow the pool of assets that may be provided to us as security, we
believe that it provides us with the following key advantages:

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• It filters out spurious jewellery that may be pledged by jewellers and goldsmiths. We find that household,
used jewellery is less likely to be spurious or fake.
• The emotional value attached by each household to the pledged jewellery acts as a strong incentive for timely
repayment of loans and revoking the pledge.

• As we only accept the pledge of household jewellery, the value of the pledged gold is typically only as much
as the worth of gold that is owned by an average Indian household. This prevents our exposure to large sized
loans where the chances of default and subsequent losses are high.

The amount that we finance against the pledged gold jewellery is typically based on a fixed rate per gram of gold
content in the jewellery. We value the gold jewellery brought by customers based on our corporate policies and
guidelines. Our Company has adopted a loan policy on July 20, 2020 (“Loan Policy”). As per the Loan Policy,
we grant Gold Loans on 22 carat gold ornaments. However, in case the gold jewellery that are being pledged is
less than 22 carat, the branches are required to convert the carat of gold jewellery to the equivalent of 22 carat.
We do not accept gold ornaments below 19 carat. The rates per gram is fixed by us on weekly intervals, based on
the extant RBI guidelines and the 30 day average closing gold rate for 22 carat fixed by India Bullion and Jewellers
Association Limited. The actual loan amount varies according to the type of jewellery pledged. While jewellery
can be appraised based on a variety of factors, such as total weight, weight of gold content, production cost, style,
brand and value of any gemstones, we appraise the gold jewellery solely based on its gold content. Our Gold
Loans are, therefore, generally well collateralized because the actual value of the gold jewellery is higher than our
appraised value of the gold jewellery when the loan is disbursed. The amount we lend against an item and the
total value of the pledged gold we hold fluctuates according to the market price of gold. An increase in the price
of gold will not automatically result in an increase in the value of our Gold Loan portfolio unless the rate per gram
is revised by our Corporate Office. It only results in a favourable movement in the value of the security, pledged
with us. Similarly, since adequate margins are built in at the time of the loan disbursement and owing to the short
tenure of these loans, on average, a decrease in the price of gold generally has little impact on our interest income.
However, a sustained decrease in the market price of gold could cause a decrease in the growth rate of Gold Loans
in our loan portfolio.

All our Gold Loans have a maximum term of 270 days. In the event that a loan is not repaid on time and after
providing due notice to the customer, the unredeemed pledged gold is disposed of, on behalf of the customer in
satisfaction of the principal and interest charges. Any surplus arising out of the disposal of the pledged gold is
refunded to the customer or is appropriated towards any other liability by the borrower. In the event that the
recoverable amount is more than the realizable value of the pledged gold, the customer remains liable for the
shortfall.

The processes involved in approving and disbursing a Gold Loan are divided into three phases:

• Pre disbursement;
• Post disbursement; and
• Release of the pledge.

Pre-disbursement process

Pre disbursement processes include all the actions that are carried out from the moment a customer enters any of
our branches for procuring a Gold Loan, up until the customer receives the loan amount and include the following:

Gold Loan appraisal of a customer involves the following steps

(a) Customer identification - Gold Loans are sanctioned only to genuine borrowers. Gold Loan can be sanctioned
to the members of staff only with prior approval of regional manager, from the branch that such staff does
not work in. The sanctioning authority should take all precautions to confirm that the applicant, pledging the
ornaments, is the true owner of those ornaments.

(b) KYC documentation – For mandatory compliance of KYC norms, as mandated by RBI and easy identification
of each borrower at a later date, a photograph and proof of identity and address acceptable to the Company,
are always obtained. Each branch has been provided with a webcam, which may be used to take the
photograph, which is then uploaded into the system, also.

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(c) Security appraisal – Once the manager is satisfied regarding ownership of the ornaments, the ornaments
would then be appraised by the manager himself and/or other staff members who are assigned with the
responsibility of appraising the gold jewellery. The ornaments being tendered are not appraised by any person
who is not associated with our Company nor are the ornaments sent out of the concerned branch for appraisal.
We use the services of our in-house gold appraisers in case of large value loans. These gold appraisers are
professionally qualified for appraising the quality of gold and usually have multiple years of experience in
appraising gold.

The process of measuring the “fineness”, or purity, of gold is referred to as ‘assaying’. There are different
methods of assaying the fineness of gold. The most commonly used methods at our branches are touch stone,
nitric acid and sound tests. Indian ornaments often contain stones of different types, some of which may be
precious. But as a matter of policy, all types of stones are ignored, and their weight reduced from gross weight
when advancing against ornaments. Sufficient margin is, therefore, retained for the approximate weight of
such stones and for arriving at eligible loan amount; net weight of the ornaments so arrived at alone is taken
into account. Reduction in weight is kept comfortably high to safeguard our interests. Wherever weight of
stones cannot be ascertained, such ornaments are avoided. All particulars/details of ornaments such as, gross
weight, net weight, rate per gram and estimated value will be entered item wise by the appraising staff on
serially numbered DPN and also on the paper used for covering/packing ornaments and signed off with the
date. The manager also verifies and satisfies himself that the ornaments have been properly tested for
purity and details - gross weight as well as net weight, are correctly noted. He should also confirm correctness
of valuation made.

(d) Documentation - The standard set of documents that are executed in a typical Gold Loan transaction include
the pawn ticket and the demand promissory note cum terms and conditions. Basic details of the pledge, such
as the name of the customer and the net weight of the jewellery pledged is recorded on the gold loan slip,
which is retained by us. The pawn ticket, which contains the details of the customer and the pledged jewellery,
is filled in by the employee who appraised the gold and a copy is retained by the customer. The demand
promissory note is an undertaking by the customer to repay the loan amount with the interest to the Company.
The terms and conditions that are contained in the demand promissory note empower us to sell the pledged
jewellery if the customer defaults on the Gold Loan. After execution of prescribed documents, a loan ticket
detailing the particulars of the loan including the details of the items pledged, rate per gram, interest rate and
maturity date is handed over to the customers along with disbursal of the loan.

Post-disbursement process

The post disbursement process involves the storage of the storage of the pledged gold jewellery. Ensuring the
safety and security of the branch premises is vital to our business since cash and gold inventory are stored in each
branch. Branch security measures implemented, by us, include:

• Every branch of the Company, without exception, is provided with a strong room constructed as per the
specifications of RBI with fire proof strong room doors. This is a provision at each location to ensure safety
of the pledged ornaments, of the clients.

• Access to the strong room is with the help of two distinct keys, which are in the hands of two different
individuals attached to the branch. The strong room has a grill door, joint custody of whose keys are with the
Branch Manager and another staff in rotation (the “Joint Custodian”). Both the branch head and the Joint
Custodian hold the keys to grill in the strong room, which can only be opened if both keys are inserted at the
same time.

• Electronic Security System: All our branches are installed with CCTV cameras. Such kind of a surveillance
system helps to avert any major incidents of frauds, thefts, etc. in the branch premises.

• Insurance: Entire gold stock of the branches is insured for their gold content against theft and other calamities.

Release of pledge

Once a loan is fully repaid, the pledged gold jewellery is returned to the customer. The customer has to be present
personally along with the gold loan token, at the branch where the pledge was originally made. The branch will
verify the person with the photo taken at the time of pledge and confirm that there is no foul play and the amount
to be paid is informed to the customer from the software and clarifies doubts if any on the amount demanded.

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The customer pays the amount at the cash counter and the ornaments are taken out of the safe and handed over
to the customer after confirming them with the list of ornaments mentioned in the token and gold loan application
form.

Microfinance Loans

Our microfinance loans are typically small ticket loans, unsecured and given to joint liability groups forming of
woman customers only. We started our Microfinance business in Fiscal 2017 and we provide loan amounts
typically within the range of `10,000 to `70,000 per loan transaction and which remain outstanding approximately
for an average tenor of 365 days to 730 days. As on March 31, 2020, March 31, 2019 and March 31, 2018, we
had 19,632, 25,749 and 32,735 micro finance loan accounts respectively, aggregating to balance of `4,537.76
lakhs, `3,215.18 lakhs and `7,240.50 lakhs, respectively. For the Fiscals 2020, 2019 and 2018, our microfinance
loan portfolio yield representing interest income on micro finance loans as a percentage of average outstanding of
microfinance loans, for the same period were 25.04%, 25.91% and 20.63%, respectively. For the Fiscals 2020,
2019 and 2018, income from interest earned on our micro finance loans constituted 3.10%, 4.54% and 2.46%,
respectively, of our total income. As of June 30, 2020, we offer only one type of scheme in micro finance.

Money Finance Loan disbursement process

The Microfinance branches identifies locations where loans are required through market survey within 25 km
radius of branch and collect the KYC of the prospective loanees and check credit worthiness from RBI approved
credit bureaus. A group guarantee is taken from the members of JLG group and the loan documentation is
completed after the required personal verifications. After the due appraisal process in accordance with
Microfinance credit policy of the Company, the amount is transferred directly to the bank account of each JLG
member. An end use check is also made by the Branch head to confirm that the disbursement is in order. The
collections are made on a weekly basis and start after a seven day moratorium, through collection agents of the
Company.

Our Company has undertaken the following other business initiatives:

Money Transfer Business – Our Company has entered into various agreements for rendering money transfer
services with third parties.

Insurance - Our Company has obtained registration with the IRDAI, to act as a corporate agent for procuring and
soliciting insurance business both in the life insurance and general insurance category, with effect from April 1,
2016. The license no. CA0122 was assigned to our Company and is valid till March 31, 2022. Pursuant to such
registration, we have entered into corporate agency agreements with various insurance providers of life, health
and general insurance products for soliciting and procuring business for such insurance providers.

DP Services – Our Company holds a certificate of registration dated July 5, 2012 bearing registration number IN–
DP–CDSL–660-2012 issued by SEBI to act as Depository Participant in terms of Regulation 20 of the Securities
and Exchange Board of India (Depositories and Participants) Regulations, 1996, as renewed of August 21, 2017.
Currently, we are registered as a Depository Participant of CDSL for securities transactions. As on June 30, 2020,
we have opened 34,110 securities DP accounts.

Broking services – We have entered into an agreement with a securities provider for carrying out online trading
in equity and derivative and commodity segments using our Depository Participant platform on its behalf, for our
existing and new clients through selected branches and regional offices.

Prepaid transactions / Payment management services – Our Company entered into a corporate arrangement,
with an intention to expand its financial services to providing electronic distribution of mobile prepaid top-up,
fixed line prepaid, STD/ISD calling cards, internet and broadband prepaid cards, VOIP prepaid cards, DTH and
Satellite radio prepaid subscription vouchers, post-paid bill payments, domestic money transfer, etc.

Travel Agency services – Our Company has entered into an agreement for air travel related services, booking of
tickets with any airlines for international or domestic travel, apply for and obtain VISA, arranging for travel
insurance, forex services, corporate services etc, as a non-International Air Travel Association agent.

PAN card related services – Our Company has entered into an agreement as PAN card service agent for
collecting and receiving PAN application forms and providing related services to PAN applicants.

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Branch Network

As on June 30, 2020, we had 785 branches in the states of Kerala, Karnataka, Tamil Nadu, Andhra Pradesh,
Telangana, Haryana, Maharashtra, Delhi and Goa and the union territory of Puducherry. The branch network of
the Company as on June 30, 2020, March 31, 2020, March 31, 2019, and March 31, 2018 are given below:

As on As on March 31
State June 30,
2020 2020 2019 2018
Andhra Pradesh 59 59 48 118
Delhi 7 7 7 7
Goa 6 6 6 6
Haryana 3 3 3 3
Karnataka 108 108 109 109
Kerala 179 179 179 179
Maharashtra 2 2 2 2
Tamil Nadu 341 341 342 342
Puducherry (Union Territory) 1 1 1 1
Telangana 79 78 70 -
Total 785 784 767 767

Customer Care

We believe that we have set in robust customer grievance redressal systems. The branches of our Company display
the names and phone numbers of the nodal officer for addressing customer complaints.

Risk Management

As a lending institution, we are exposed to various risks that are related to our gold lending business, micro finance
business and operating environment. Risk management forms an integral element of our business. Our objective
in the risk management processes is to appreciate, measure and monitor the various risks that we are subject to
and to follow policies and procedures to address these risks. We do so through our risk management architecture.
We continue to improve our policies and procedures and to implement these rigorously, for the efficient
functioning of our business. This also helps in managing the risks, associated with our business. Our Company
has adopted a risk management policy on July 20, 2020 (“Risk Management Policy”). The major types of risk
we face in our businesses are credit risk, operational risk, financial risk and market risk.

Credit Risk

Credit risk is the possibility of loss due to the failure of any counterparty to abide by the terms and conditions of
any financial contract with us. We believe that the credit risk in our Gold Loan business is relatively low because
all our loans are generally over collateralized by pledged gold ornaments. We aim to reduce credit risk through a
rigorous loan approval and gold appraisal process, KYC compliance procedures and a strong non-performing asset
(“NPA”) monitoring and recovery mechanism. The credit risk is diminished because the gold jewellery used as
security for our loans can be readily liquidated, and the possibility of recovering less than the amount due to us is
relatively low. We also mitigate credit risk by not disbursing loans in excess of specified limits, as fixed by our
Company from time to time, to the same customer, and for high value loans we undertake a credit check or
profiling of the borrower before a loan is approved. We have developed methods to peg the value of the loan
amount to the moving average price of gold. We also decrease credit risk by focusing on the quality of the pledged
gold. Our internal control system ensures independent verification of the gold by at least two officials at the branch
level. The level of verification at the branch level increases as the loan value increases. In addition, the quality of
gold is checked by the inspecting officers of the Company through random check and by gold auditors through a
detailed check.

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Credit risk in our micro finance business is generally higher than our Gold Loan business as the amount advanced
is on unsecured basis. However, our product is designed in such a way that the loans are granted to individuals
who form a part of the group and the group is ultimately liable for each member repayment obligation under that
group. We also mitigate credit risk by not disbursing loans in excess of specified limits which is currently `0.70
lakh to an individual customer. We also decrease credit risk by closely follow up with the group members on
weekly basis.

Operational Risk

Operational risk broadly covers the risk of direct or indirect loss due to the failure of systems, people or processes,
or due to external events. We have instituted a series of checks and balances and audit reviews to address the
various operational risks. We have clearly defined appraisal methods to mitigate appraisal risk. Inaccurate
appraisal of the pledged gold may lead to funds being advanced against low value or spurious gold. This risk is
mitigated by our policies on internal control, generation of alert reports and additional requirements for high value
loans. We also have detailed guidelines on movement of cash or gold to address custodial risk, which is the risk
associated with the safety and security of our gold inventory. In addition, we have installed surveillance cameras
across of all our branches, and security guards are present at night at certain sensitive branches. We undertake
significant employee profiling and background verification checks before hiring and continuously monitor their
lifestyle changes.

Financial Risk

Our business is cash intensive and requires substantial funds, on an ongoing basis, to finance the loan portfolio
and to grow it. Any disruption in the funding sources would have a material adverse effect on our liquidity and
financial condition. The Company is proactively pursuing a system of identifying and accessing newer and
cheaper sources of funds, to finance the AUM and to grow the business. There is a regular meeting of our asset
liability management committee which reviews the liquidity position of the Company and arranges for sufficient
funding in advance, for growth.

Market Risk

Market risk arises from the decline in the value of the pledged gold due to fluctuation in gold prices. This risk is
in part mitigated by linking the LTV to the 30 day average price of gold. This risk is further reduced because we
appraise the gold jewellery and fund loans based solely on the weight of gold content without considering design
cost, production cost or value of gemstones. In addition, we believe that the sentimental value of the gold jewellery
to the customers may induce repayment and redemption of the pledged gold even if the value of the pledged gold
falls below the value of the repayment amount. We believe that a prompt and effective recovery mechanism also
helps us deal with this risk.

Our Risk Management Policy

In order to address the risks that are inherent to our business, we have developed a risk management architecture
that includes a Risk Management Committee, internal audit department, and a risk management department. Our
Risk Management Committee, which is led by one of our Directors, oversees our risk management policies, which
help us to identify, measure, monitor and mitigate the various risks that we face in our businesses. For details of
membership of the Risk Management Committee, see “Our Management” on page 108.

The risk management policy of our Company was reviewed at the meeting of the Board on July 20, 2020. The
terms of reference of our Risk Management Committee are as follows:

(a) To assist the Board in setting risk strategy policies in liaison with management and in the discharge of its
duties relating to corporate accountability and associated risk in terms of management assurance and
reporting;

(b) To review and assess the nature, role, responsibility and authority of the risk management function within the
Company and outline the scope of risk management work; and

(c) To review and assess the quality, integrity and effectiveness of the risk management systems and ensure that
the risk policies and strategies are effectively managed.

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Internal Audit Department

Our internal audit department assists in the management of operational risk. Separate divisions of our internal
audit department have been put in place to handle the audit of the departments of the Corporate Office and those
of the branch offices. A branch inspection is carried out once in 3 months for all branches and once in 2 months
for high risk branches with the focus on the verification of the Gold Loan pledges. In addition, an incremental
high value loan check is carried out by Regional Managers as part of their periodical branch inspection.

Risk Management Audit

Our branch auditors also carry out a system driven risk audit on certain identified risk parameters. These are keyed
into the system and alerts are sent to branch controllers and top management in case the risk weight given under
a specific parameter goes beyond the prefixed tolerance levels. In all such cases, the concerned branches are
inspected by the branch controllers or top management personnel depending on the severity of risk and immediate
remedial actions are initiated.

Assets-Liabilities Management Policy

Our Board adopted the asset-liability management policy (“ALM Policy”) on May 8, 2017. The primary objective
of our ALM Policy is to ensure the stability of our net interest income as well as ensuring that we have liquidity
and pricing stability. In order to monitor the ALM Policy, the Board at their meeting held on April 22, 2013
constituted an Asset Liability Committee (“ALCO”) comprising of the directors and senior management
functionaries of the Company, which was re-constituted on March 27, 2017 and thereafter on July 20, 2020.

Non-performing Assets (NPA)

The Master Directions require that every non-deposit taking NBFC shall, after taking into account the degree of
well-defined credit weaknesses and extent of dependence on collateral security for realisation, classify its
lease/hire purchase assets, loans and advances and any other forms of credit into the following classes:

• Standard assets;
• Sub-standard assets;
• Doubtful assets; and
• Loss assets.

Further, the class of assets referred to above shall not be upgraded merely as a result of rescheduling, unless it
satisfies the conditions required for an upgrade. A non-deposit taking NBFC is required to make provisions against
sub-standard assets, doubtful assets and loss assets in accordance with the above RBI Master Directions. In terms
of the RBI Master Directions, non-deposit taking NBFC has to make the following provisions on their loan
portfolio:

Asset Classification Provisioning Policy

Standard Assets 0.40%
Sub-standard Assets 10%
Doubtful Assets 100% of unsecured portion + 20-50% of secured portion ($)
Loss Assets 100% provided if not written off
$: In addition to above, depending upon the period for which the asset has remained doubtful, provision to the
extent of 20% to 50% of the secured portion

For further details, please refer to “Key Regulations and Policies” on page 204.

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Based on the RBI Master Directions for asset classification, details of the classification of our gross NPAs for
significant classes of our assets for the Fiscals March 31, 2020, March 31, 2019 and March 31, 2018 are furnished
below:

(`in lakhs)
Asset Type As on March 31
2020 2019 2018
Sub-standard 2,127.04 457.17 1,217.67
Doubtful 624.66 2,322.06 1,922.65
Loss 438.44 208.20 114.51
Gross NPA 3,190.14 2,987.44 3,254.83
Less Provisions 931.76 1,090.47 799.17
Net NPA 2,258.38 1,896.97 2,455.66
Net NPA% of Total Assets under 1.34 1.38
1.58
management

Secured loans are classified or provided for, as per management estimates, subject to the minimum provision
required as per RBI Master Directions. We have written off `19.72 lakhs and `1.78 lakhs for Fiscals 2020 and
2018, respectively. We have not written off any amount for Fiscal 2019.

NPA Policy

Our Board adopted the Non Performing Asset policy (“NPA Policy”) on April 7, 2015. In terms of the NPA
Policy, all loans outstanding beyond the loan validity are disposed of within three months from the expiry of the
loan period. In order to undertake this, our Company has put in place a gold loan and micro finance loan
monitoring, follow-up and disposal mechanism in place. Our Company has an Overdue Loans Cell (“OLC”) at
the Corporate Office under Chief Operating Officer which interacts with branches and their controllers for speedy
recovery of all loans which has exceeded the stipulated loan tenor.

Since disposal of Gold Loans through individual branches is not feasible, our Auction policy spells out the
operational workflow for a centralized Gold Loan disposal set up as follows:

(a) Identification of potential overdue gold loans by OLC and advising them to concerned branches;

(b) Sending first notice to borrowers latest by 15 days prior to the loan becoming overdue;

(c) Personal visit by branch manager/staff member on the defaulting customer within 7 days from the date
of notice;

(d) If no result is forthcoming, serving of second repayment notice after a maximum gap of 15 days from
the date of personal visit and/or the first notice;

(e) If the loan remains outstanding even after above taken measures, takeover of the gold ornaments by the
Regional Manager (RM) within a span of one month and transfer the loan account to Corporate Office
overdue Loan Pool account;

(f) All gold ornaments, underlying the loans, which taken over by the RM would either be auctioned at the
HQ branch, if the weight of gold is sizeable or will be transferred to specified auction centres periodically;

(g) At any point of time before the loan is transferred to auction centre, in case the borrower approaches the
company for redemption of pledged ornaments, this will be carried out by the concerned branch
(originating or HQ) in the normal manner;

(h) Auctions are carried out only after publishing the auction date and venue in two vernacular dailies being
circulated in the area of concerned branches. Also, the concerned branches are instructed to display the
auction date and centre, on their notice boards well in advance; and

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(i) As further concession to customers, the Company may also consider settlement of loan dues by way of
concessions in interest as a one-time settlement on a case-to-case basis, only with approval from
Corporate Office.

Auction Policy

Under the various schemes offered by our Company, the loans are typically granted for a maximum tenure of 270
days. Under such schemes of our Company, the borrowers are obligated to repay the principal amount together
with the accrued interest in a specified period. In a business such as ours, there are certain instances wherein the
borrowers fail to repay the amount within the specified period. Consequently, our Company settles such overdue
accounts by means of a public auction to realise the dues. Our Company vide a resolution of its Board on July 20,
2020, approved the auction policy of the Company (“Auction Policy”) which was reviewed by the Board of
Directors of our Company on July 20, 2020. Further, we identify the accounts for auction on the basis of:

(a) All accounts in which interest remains unserved in full and if the loan is not closed at the end of tenure
in various schemes, it will be identified and listed as “eligible for auction accounts”;

(b) An account which has been classified as an NPA account in accordance with policies laid down by the
Company;

(c) Accounts that have not completed loan tenure but having a substantial erosion in the realizable value of
the security to cover the dues i.e. Mark to Market cases (MTM Cases) may be taken up for auction in
case all recovery initiatives fail.

In terms of our Auction Policy, on identification of such eligible auction account, we sent notices to the borrowers
to repay the dues, on failure of which, we initiate the process of public auction. Since as per the revised RBI
guidelines, the company or its promoters cannot participate actively in the auction, qualified and experienced
auctioneers are appointed by the company to carry out the auction on behalf of the company. In accordance with
our Auction Policy, the auction shall be carried out by an auctioneer empanelled by the Company with the approval
of the Board.

Capital Adequacy Ratio

As per the Master Directions, every NBFC-ND-SI including us are subject to capital adequacy requirements.
Currently, we are required to maintain a minimum capital ratio consisting of Tier I and Tier II capital which shall
not be less than 15% of its aggregate risk weighted assets on balance sheet and of risk adjusted value of off-
balance sheet items. Further, we need to maintain a Tier I capital of 12%. Also, the total of Tier II capital, at any
point of time, shall not exceed one hundred percent of Tier I capital. Additionally, we are required to transfer up
to 20% of our annual profit to a reserve fund and make provisions for NPAs. We had a capital adequacy ratio of
29.65%, 34.85% and 33.91%, on March 31, 2020, March 31, 2019 and March 31, 2018, respectively. We have
satisfied the minimum capital adequacy ratios prescribed by the RBI for the financial year ended March 31, 2020,
March 31, 2019 and March 31, 2018.

Technology

We believe that the usage of a technology platform across our operations has improved our growth. Our web based
centralised IT platform which records details of all branches. We believe that our IT infrastructure helps us with
real time data transmission and updates, and endeavour to minimise errors, ensure faster data transmission and
risk monitoring. We upload data at each branch to facilitate online information access for faster decision making.
Our technology also helps reduce the time it takes to complete Gold Loan / micro finance loan transactions.

Our IT system aids the performance of all the processes involved in a loan transaction. At the pre-disbursement
stage, all KYC details as well as other details of customer appraisal are captured and stored in the system for
future reference. All the details that are relevant to a loan transaction are captured by the system and filtered at
each level to confirm whether a particular set of pledged jewellery meets the required specifications. The branch
staff, upon verification of the gold ornaments key in information into the system that uses the input data to arrive
at the net weight and calculates the maximum limit for a loan advance that can be offer against it, under the
specific scheme chosen by the customer. Based on the saved data, all accounting entries are also passed by the
system.

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The current core banking application is more than 10 years old and has dependency to some of the older operating
system / libraries / browsers. Scalability of the application is also limited due to the inherent architecture of the
system. Performance is degrading as the transactions and data grew over time. Dependency on certain versions of
windows and Internet Explorer (IE) of the current software to function may soon lead to disruptions, if Microsoft
does not support some of these older versions of their software anymore.

Some of the IS requirements as per the RBI master circular is hard to implement in the current ERP system.
Detailed analysis revealed Implementing Some of the IS feature/security requirements as per the RBI master
circular like maker/checker, user group wise access control, record level audit logs, upgrading technology,
enabling support for latest browsers, fixing of vulnerabilities, scalability, consolidation, MIS reports/dashboards,
setting up DR, etc would require the entire application to be rewritten, which requires a lot of time, effort and
cost. After discussions with external technical consultants and strategy committee, it was decided to either create
a new core banking software (in house) or to purchase a software from external vendors. New software
requirements were collected and Initial estimates on resources, time and costs, to develop the software in-house,
were created and submitted to management. In parallel, we took quotes from other core banking software service
providers as well. While trying to recruit more required skill sets and resources (recruitment), it revealed that
getting the right resources to build such a big ERP product will also be a challenge and critical risk. The time
required to build and mature such a new product will not be less than two years. Considering competent technical
resources required, long time and cost needed to build, test and implement a new software, licensing/purchasing
a new software which is compliant with the RBI directions was opted by the technical team and management A
new software from LCode Technologies is finalised after several rounds of discussions and negotiations.
Agreement was signed on 28/01/2020 and the software is planned to finish customization and implementation by
March 31, 2021. Since, we have planned to migrate to a new platform and new software, further developments on
the current software is now paused.

Our Borrowings and Credit Ratings

As on June 30, 2020, our Company had outstanding secured borrowing of `86,372.68 lakhs (including PTC
transaction of ` 1,661.98 lakhs) and unsecured borrowing of ` 35,269.60 lakhs. We believe that we have
developed stable long term relationships with our lenders and have established a track record of timely servicing
of our debts. Please refer to the sections titled “Financial Statements” and “Financial Indebtedness” on pages
118 and 126, respectively.

Our Company has received rating of ‘IND BBB’: Outlook Stable’ by India Ratings vide its letter dated August
14, 2020 for the NCDs for an amount up to `40,000 lakhs including NCDs proposed to be issued pursuant to this
Issue. Further, India Ratings, pursuant to their rationale letter dated August 14, 2020, have upgraded our bank
loans ratings of `50,000 lakhs from ‘IND BBB-; Stable’ to ‘IND BBB’/Stable’. The rating of the NCDs by India
Ratings indicate that instruments with this rating are considered to have moderate degree of safety regarding
timely servicing of financial obligations. Such instruments carry moderate credit risk. The rating provided by
India Ratings may be suspended, withdrawn or revised at any time by the assigning rating agency and should be
evaluated independently of any other rating. The rating is not a recommendation to buy, sell or hold securities and
Investors should take their own decisions. Please refer to Annexure II for the rationale for the above rating.

Security threats and measures taken to mitigate them

Since our branches handle large value of cash and gold on a daily basis, we have initiated specific security
measures to prevent theft of our branch assets. These measures can be categorized as under:

• Physical security is provided by means of keeping the valuable gold ornaments in pucca strong rooms
constructed as per the specifications of Reserve Bank of India with fire proof strong room doors.

• We have a system of Joint Custody of Gold and Cash in strong rooms to ensure that the keys of strong
room doors are held in the custody of two different people i.e. the Branch Manager and another staff
member, the Joint Custodian.

• All our branches are provided with Electronic Surveillance System and any movement within business
area and in the strong room are recorded by the cameras placed inside the premises. All our existing
branches have CCTV cameras installed.

• Entire gold stock of the branches is insured for their gold content against theft, dacoity.

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• Proper checking of gold ornaments by appraiser, branch manager as well as audit by gold auditor and
internal auditors at frequent intervals is undertaken to ascertain the quality of gold ornaments and ensure
low purity of gold ornaments are not pledged.

• We have also in place a whistle blower policy which will ensure that any malpractices within the branch
are reported to senior level executives

Competition

We face competition from pawnshops, other gold / micro financing companies, banks, co-operative societies and
local money lenders. Other lenders may lend money on an unsecured basis, at interest rates that may be lower
than our rates of interest and on other terms, which may seem more favourable than ours. However, we believe
that the primary elements of our competitive edge are the quality of customer service and relationship
management, our branch location and reach and our ability to lend competitive amounts at competitive rates, with
full transparency.

Property

Our Company has 785 branches, as on June 30, 2020 spread across the states of Kerala, Karnataka, Tamil Nadu,
Andhra Pradesh, Telangana, Haryana, Maharashtra, Delhi and Goa and the union territory of Puducherry, which
are taken either on leasehold or owned basis.

Intellectual Property

We currently do not own our trademark. The trademark is owned by Mini Muthoottu Nidhi (Kerala) Limited, one
of our Group Companies.

Mini Muthoottu Nidhi (Kerala) Limited by way of their letter dated May 2, 2009, authorised our Company to use
the trademark , which was revalidated by a letter dated July 30, 2020.

Employees and Training of Employees

Being a service industry, our key resource is our manpower. As on June 30, 2020, we have 3,109 employees. Our
Company emphasizes on imparting effective and continual training to its employees in a planned and systematic
manner, to acquire and sharpen capabilities required to perform various functions associated with their
present/expected future roles in the business of our Company.

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HISTORY AND CERTAIN OTHER CORPORATE MATTERS

Our Company was incorporated as ‘Muthoottu Mini Financiers Private Limited’, a private limited company under
the provisions of the Companies Act, 1956, pursuant to a certificate of incorporation issued by the RoC dated
March 18, 1998. Pursuant to a special resolution passed in the general meeting of our Shareholders held on
September 14, 2013 and a fresh certificate of incorporation issued by the RoC on November 27, 2013, our
Company was converted into a public limited company and consequently our name was changed to ‘Muthoottu
Mini Financiers Limited’.

Our Company has obtained a certificate of registration dated April 13, 2002 bearing registration no. – N-16.00175
issued by the RBI to carry on the activities of a NBFC under Section 45 IA of the RBI Act. Our Company is a
systemically important non-deposit taking NBFC. Further, a fresh certificate of registration was issued by RBI on
January 1, 2014, pursuant to the change of name of our Company from ‘Muthoottu Mini Financiers Private
Limited’ to ‘Muthoottu Mini Financiers Limited.’

Our Company has also obtained a certificate of registration bearing registration no. – CA0122 issued by IRDAI,
with effect from April 1, 2016 (renewed w.e.f April 1, 2019), under Section 42D (1) of the Insurance Act, to act
as a “Corporate Agent (Composite)”.

Our Company holds a certificate of registration dated July 5, 2012 bearing registration number IN–DP–CDSL–
660-2012 issued by SEBI to act as Depository Participant in terms of Regulation 20 of the Securities and Exchange
Board of India (Depositories and Participants) Regulations, 1996, renewed on August 21, 2017.

Mathew Muthoottu, one of the Promoters, is the Managing Director of our Company and Nizzy Mathew, mother
of Mathew Muthoottu who is also the Chairman and Wholetime Director of our Company, is the other Promoter
of our Company.

Our Company belongs to the Muthoottu Mini group. Muthoottu Mini group belongs to the Muthoottu family of
Kozhencherry, which was founded by Ninan Mathai Muthoottu, who started the family business enterprise in
1887. In 1939, three sons of Ninan M. Muthoottu, viz, M. George Muthoot, M. Mathew and M. Pappachan
Muthoot started a finance company named as Muthoot M. George & Brothers (“MGB”). In the early 1970s, they
separated their business enterprises into three groups i.e. the current Muthoot Finance group of companies which
is controlled by the sons of George M. Muthoot, the Muthoot Fincorp group which is controlled by the sons of M.
Pappachan Muthoot and the Muthoottu Mini group which was earlier controlled by the son of M. Mathew i.e. Roy
M. Muthoottu. Muthoottu Mini group is presently controlled by Mathew Muthoottu, son of Roy M. Muthoottu.
Other than the aforementioned family connection, all the groups are distinct from each other and none of them are
having any inter-group shareholdings or controls or business dealings. The Muthoottu Mini group commenced
operations at Kozhencherry, Pathanamthitta, Kerala and has over two decades of established history in the money
lending business, mainly in small scale money lending against used household gold jewellery. The Muthoottu
Mini group has been in the gold loan financing since 1986 and our Company has been extending Gold Loans since
its incorporation.

Roy M. Mathew was the managing director of our Company from March 18, 1998 to March 1, 2016 and vide a
letter dated March 1, 2016 to the Board of the Directors, he intimated his resignation from the Board. The
Company vide a letter dated April 16, 2016 informed RBI about the resignation of Roy M. Mathew as the
managing director of our Company. Roy M. Mathew on September 29, 2016 transferred 1,22,90,000 Equity
Shares to his son Mathew Muthoottu and 33,16,352 Equity Shares to his wife Nizzy Mathew, respectively,
pursuant to the approval granted by RBI vide a letter dated August 2, 2016.

Registered Office

The Registered Office of our Company is located at 2/994, Muthoottu Buildings, Kozhencherry, Pathanamthitta
– 689 641, Kerala, India.

Change in Registered Office of our Company

There have been no changes in our Registered Office since incorporation.

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Amalgamation, acquisition, re-organisation or reconstruction undertaken by the Company in the last one
year

We have not undertaken any amalgamation, acquisition, re-organization or reconstruction in the last one year.

Key milestones, events and achievements:

Date/Fiscal Particulars
April 13, 2002 Certificate of registration issued by RBI to our Company to act as non-deposit taking
NBFC
July 5, 2012 Certificate of registration issued by SEBI to our Company to act as Depository Participant
which was renewed on August 21, 2017
November 27, Our Company was converted to a public limited company
2013
January 1, 2014 Fresh certificate of registration was issued by RBI to act as a non-deposit taking NBFC,
pursuant to name change of our Company
2013-2014 Listing of non-convertible debentures issued vide Public Issue 1 on BSE
2016-2017 Our Company commenced the business of microfinance loans
March 28, 2016 Certificate of registration issued by IRDAI to our Company to act as a Corporate Agent
(Composite), with effect from April 1, 2016 (renewed w.e.f April 1, 2019)

Main objects of the MoA

Following are the main objects of our Company, as provided in the MoA:

1. To borrow, raise or take money, to lend or advance money either upon or without security, to draw, make
accept, discount, buy, sell collect and deal in bills of exchange, hundies, promissory notes, coupons, drafts,
bills of lading, railway receipts, warrant, debenture, certificates, scripts and other instruments and securities
whether negotiable or transferable or not in accordance with the guide lines issued by the Reserve Bank of
India.

2. To carry on the business of the hire purchasers by advancing or lending money upon or without security. But
the Company shall not carry on the business of Banking Regulation Act 1949.

3. To acquire, hold issue on commission underwrite and to deal in stocks, funds, shares, bonds, securities,
obligations and investments of all kinds, dealing in commodities and taking membership on commodity
exchange and undertaking of depository participant activities.

4. To carry in India all or any or more of the following business, namely the leasing, buying, selling on such
terms and conditions as may be determined by the Board of Directors of the Company from time to time.

5. To do business as corporate Insurance agents by soliciting, procuring and marketing all types of Insurance
namely Life, medical and all other general insurance products.

6. To carry on the business as Authorised Dealer, Money Exchanger, Offshore Banker or any other person for
the time being in authorised to deal in foreign exchange or foreign securities or such other activities and to
undertake Cross Border Inward Money Transfer Activities subject to the rules and regulations of the Reserve
Bank of India.

7. To promote the financial inclusion of masses by carrying on the business of providing microfinance services
and catering to needs of a large number of underprivileged people directly or indirectly, by providing credit
including collateral free credit to needy people, especially for empowering women, through their solidarity
group, and to deliver micro credit and other permitted financial services to them at their group meetings in
the cities, town, villages of India, with a view to providing them with a sustainable livelihood.

Subsidiaries of the Company

As on the date of this Prospectus, our Company does not have any subsidiary.

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Key terms of the material agreements

1. Trust Deed dated January 21, 2020 entered into between our Company (the “Settlor”) with Catalyst
Trusteeship Limited (the “Trustee”)

The Settlor entered into a Trust Deed on January 21, 2020 (“Trust Deed”), with the Trustee, for the
establishment, settlement and setting up of a trust named Northern Arc 2019 GL Aurum Trust (the “Trust”),
to which the securitised receivables from an identified pool of loans would be assigned. A sum of ` 1,000 is
kept apart by the Settlor as the initial corpus of the Trust. The Trust intends to issue Pass Through Certificates
(“PTCs”) to investors, which evidences their undivided beneficial interest in the receivables. The Trust
property vests in the Trustee, who holds the same for the benefit of the beneficiaries of the Trust. The Trustee
is entitled to be indemnified out of the Trust Property. The deeds of securitisation under the Trust Deed,
includes the Trust Deed, the Assignment Agreement, the Servicing Agreement, the Credit Enhancement
Documents, the power(s) of attorney and all other instruments, deeds and documents executed between the
Trustee and our Company for securitising the Receivables (“Deeds of Securitisation”). The Information
Memorandum is issued by the Trustee, which supplies information for the issuance of the PTCs. The Trust
shall make payments of the proceeds in accordance with the Waterfall Mechanism, stipulating the following
order of priority: (1) Until the Series A1 PTCs, which are the certificates to be issued by the Trustee to an
investor evidencing their undivided beneficial interest in the Series A1 Investor Pay-outs – which means the
amounts expected to be paid to the Series A1 Investors in accordance with the Waterfall Mechanism, have
not been fully redeemed, the following order of priority should be followed: (i) payment of Senior Costs,
which are the costs incurred by the Trustee; (ii) payment of Overdue Series A1 Interest, which is the Series
A1 Interest payable at the Series A1 Interest Rate of 10.25% per annum but has not been so paid to the Series
A1 Investors; (iii) payment of Series A1 Interest Due; (iv) payment of expected Series A1 Principal which
aggregates to `5,158.90 lakhs; (v) any Prepayment proceeds will be utilized for pre-payment of Series A1
Principal; (vi) reimbursement of the Funded FLCE comprising of the cash collateral, to the extent drawn on
any Investor Pay-out Date and not reimbursed already; and (vii) payment to the Residual Beneficiary i.e. the
our Company; (2) On full redemption of the PTCs, any amounts received shall be paid in the following order
of priority: (i) payment of senior costs; and (ii) payment to the residual beneficiary; (3) Amounts recovered
pursuant to any legal proceedings and the clean-up purchase consideration shall be paid out in the following
order of priority: (i) for application towards payments for the Series A1 PTCs; and following that, (ii) for
payment to the residual beneficiary. The Cash Collateral placed by our Company with the approved bank
amounts to `493.21 lakhs, which is 8.70% of the outstanding principal under the receivables.

2. Servicing Agreement dated January 21, 2020 entered into between the Company (“Servicer”) and
Northern Arc 2019 GL Aurum Trust (the “Trust”) acting through Catalyst Trusteeship Limited (the
“Trustee”)

The Servicing Agreement dated January 21, 2020 entered into between the Servicer and the Trust acting
through the Trustee, provides the conditions governing the collection and facilitation of the collection of the
amounts constituting the receivables, by the Servicer. Such amounts, including amounts received on
enforcement of the security interest or the sale or realisation of the secured assets, would be deposited by the
Servicer into the collection and pay out account, for its ultimate distribution to the investors and beneficiaries.

3. Assignment Agreement dated January 21, 2020 entered into between the Company (“Seller”) and
Northern Arc 2019 GL Aurum Trust (“Trust”) acting through Catalyst Trusteeship Limited (“Trustee”)

The Assignment Agreement dated January 21, 2020 entered into between the Seller and Trust acting through
the Trustee, defines the stipulations governing the assignment of the right, title and interest in the collateral
and underlying Security Interest created to secure the repayment of facilities, and the underlying documents
to the Trustee, in accordance with the Trust Deed, the Servicing Agreement and the other Deeds of
Securitisation, as defined in the Trust Deed given above. The assigned assets do not form part of the properties
or assets of the Seller or the Trustee in any event, including the winding up, insolvency or liquidation of the
Trustee or the Seller. The Seller’s Funded Credit Enhancement and the Seller’s Credit Enhancement
comprises of the Cash Collateral, which is the fixed deposit(s) aggregating up to an amount of `493.21 lakhs,
assigned by the Seller to the Trust to be utilized in accordance with the Deeds of Securitisation.

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OUR MANAGEMENT

Board of Directors

The composition of our Board is governed by the provisions of the Companies Act, 2013, and the rules prescribed
thereunder. The Articles of Association of our Company require us to have not less than three (3) and not more
than 12 Directors. As on the date of this Prospectus, we have six Directors on the Board which include two
Executive Directors and four Non-Executive Directors, out of which our Board has three Independent Directors.

The general superintendence, direction and management of our affairs and business are vested with the Board of
Directors.

The following table provides information about the Directors as of the date of this Prospectus:

Date of
Age Appointment/Re-
Name, Designation, Nationality, (years) appointment Other Directorships
DIN, Occupation and Address (Period of
Directorship in
Years)
Nizzy Mathew 67 3 years from 1. Muthoottu Mini Theatres
January 1, 2019, Private Limited;
Designation: Chairman and liable to retire by 2. Muthoottu Mini Nidhi Limited;
Wholetime Director rotation 3. Cochin Mini Muthoottu Nidhi
Limited;
DIN: 01680739 4. Muthoottu Mini Hotels Private
Limited;
Nationality: Indian 5. Mini Muthoottu Nidhi Kerala
Limited;
Occupation: Business 6. Mini Muthoottu Credit India
Private Limited;
Address: Muthoottu House, 7. Mini Muthoottu Nirman and
Kozhencherry, Pathanamthitta – 689 Real Estate Private Limited;
641, Kerala, India 8. R M M Properties India Private
Limited;
9. Kozhencherry Properties India
Private Limited; and
10. Kozhencherry M M Financial
Services Private Limited
Mathew Muthoottu 31 3 years from May 1. Muthoottu Mini Theatres
30, 2018, liable to Private Limited;
Designation: Managing Director retire by rotation 2. Mini Muthoottu Credit India
Private Limited;
DIN: 01786534 3. Mini Muthoottu Nirman and
Real Estate Private Limited;
Nationality: Indian 4. Muthoottu Mini Hotels Private
Limited;
Occupation: Business 5. Kandamath Cine Enterprises
Private Limited;
Address: Muthoottu House, 6. R M M Properties India Private
Kozhencherry, Limited;
Pathanamthitta – 689 641, Kerala, 7. Kozhencherry Properties India
India Private Limited; and
8. Kozhencherry M M Financial
Services Private Limited
Thomas Cherian 70 2 years from 1. Ayyar and Cherian Consultants
September 30, 2018 Private Limited;
Designation: Independent Director 2. Roshini Sea Foods Limited;
3. Beancounters Outsourcing
DIN: 00492598 Services Private Limited;
4. Wintos Plantations Private
Nationality: Indian Limited;
5. Roshini Acquaculture Private
Occupation: Professional Limited; and

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 Muthoottu Mini Financiers Limited

Date of
Age Appointment/Re-
Name, Designation, Nationality, (years) appointment Other Directorships
DIN, Occupation and Address (Period of
Directorship in
Years)
Address: Angadisseril House, 6. Enchakattu Resorts and
Kollad P.O., Kottayam – 686 289, Plantations Private Limited
Kerala, India
Rajagopal M. S. 44 Appointed as a non- Nil
executive director
Designation: Non-Executive from September 30,
Director 2019; not liable to
retire by rotation
DIN: 08114376

Nationality: Indian

Occupation: Professional

Address: Sreemangalam, Ambedkar

Colony, Thiruvarppu P.O., Kottayam
– 686 020, Kerala, India
Jose Paul Maliakal 69 November 18, 2019 Kosamattam Finance Limited
to March 31, 2021
Designation: Independent Director

DIN: 07218120

Nationality: Indian

Occupation: Chartered Accountant

Address: Chethalan, Church Road,

Pariyaram, Thrissur – 680 721,
Kerala, India

Rudran Puthukulangara 70 February 26, 2020 Nil

to March 31, 2021
Designation: Additional
Independent Director*

DIN: 00546638

Nationality: Indian

Occupation: Director

Address: 18, Green Gardens 73/452,

Karshaka Road, Off S R M Road,
Vaduthala, Ernakulam - 682023,
Kerala, India
*Subject to approval by the Shareholders.

Relationship between Directors

Except as stated below, none of our Directors are related to each other:

No. Name of the Director Designation Relationship with other Directors

1. Nizzy Mathew Chairman and Wholetime Director Mother of Mathew Muthoottu
2. Mathew Muthoottu Managing Director Son of Nizzy Mathew

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 Muthoottu Mini Financiers Limited

Brief profiles of our Directors

Nizzy Mathew, aged 67 years, is the Chairman and Wholetime Director of our Company. She holds a bachelor's
degree in arts from the University of Kerala and has been a Director of our Company since its incorporation and
is responsible for overall management of the Company.

Mathew Muthoottu, aged 31 years, is the Managing Director of our Company. He holds a bachelor’s degree in
commerce from Mahatma Gandhi University, Kerala. He has been a Director of our Company since March 7,
2008 and is responsible for business promotion, expansion and brand building activities of our Company.

Thomas Cherian, aged 70 years, is an Independent Director of our Company. He is a Fellow Member of the
Institute of Chartered Accountants of India and has been a Director of our Company since September 1, 2014.

Rajagopal M.S., aged 44 years, is the Non-Executive Director of our Company. He holds a master’s degree in
law from Mahatma Gandhi University, Kerala, and has been a Director of the Company since October 8, 2018.

Jose Paul Maliakal, aged 69 years, is an Independent Director of our Company. He is a Fellow Member of the
Institute of Chartered Accountants of India. He has been a Director of our Company since November 18, 2019.

Rudran Puthukulangara, aged 70 years, is an Additional Independent Director of our Company. He has been a
Director of our Company since February 26, 2020.

Confirmations

None of our Directors have been restrained or prohibited or debarred by SEBI from accessing the securities market
or dealing in securities.

None of our Directors have been identified as a ‘Wilful Defaulter’ by any financial institution or bank, or a
consortium thereof, in accordance with the guidelines on Wilful Defaulters issued by the RBI. None of our
Director’s features in any list of defaulters by Export Credit Guarantee Corporation of India or any
government/regulatory authority.

None of our Directors was a promoter, director or person in control of any company which was delisted within a
period of ten years preceding the date of this Prospectus, in accordance with Chapter V of the SEBI Delisting
Regulations.

Terms of appointment of Directors

Managing Director

Mathew Muthoottu was re-appointed as the Managing Director of our Company for a period of 3 years from May
30, 2018, pursuant to a resolution of the Board dated May 26, 2018 and a resolution of our Shareholders dated
September 26, 2018. According to his term of appointment, he is authorised to receive `5 lakhs per month, which
pursuant to a resolution of the Board dated February 26, 2020 was revised to `8 lakhs per month from February
1, 2020.

Chairman and Wholetime Director

Nizzy Mathew was re-appointed as the Chairman and Wholetime Director of our Company for a period of 3 years
from January 1, 2019, pursuant to the Board resolution dated December 31, 2018. According to her term of
appointment, she is authorised to receive `4.3 lakhs per month, which pursuant to a resolution of the Board dated
February 26, 2020 was revised to `6 lakhs per month from February 1, 2020.

Non-Executive Directors

The Board of Directors of our Company in their meetings held on December 17, 2012 and February 26, 2020 have
approved payment of sitting fees of `20,000 and `5,000 respectively, to Non-Executive Directors for attending
the meetings of the Board and committees of the Board, respectively.

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 Muthoottu Mini Financiers Limited

Remuneration paid to our Directors in the last Fiscal by our Company

The following table sets forth the remuneration (which includes sitting fees) paid by our Company to our Directors
during Fiscal 2020:

(`in lakhs)
Name of Directors Fiscal 2020
Mathew Muthoottu 66.00
Nizzy Mathew 55.00
Rajagopal M.S. 0.85
Thomas Cherian 2.70
Jose Paul Maliakal 0.50
Krishnakumar K. R.* 0.20
Rudran Puthukulangara** 0.20
*
Krishnakumar K.R. resigned from the Board with effect from September 30, 2019
**
Rudran Puthukulangara was appointed on the Board with effect from February 26, 2020

Interest of our Directors

All of our Independent Directors may be deemed to be interested to the extent of sitting fees payable to them for
attending meetings of the Board. All of our Executive Directors may be deemed to be interested to the extent of
remuneration payable to them. All of our Directors are interested to the extent of reimbursement of expenses
payable to them by our Company.

Further, Mathew Muthoottu and Nizzy Mathew may also be regarded as interested to the extent of any Equity
Shares held by them and also to the extent of any dividend payable to them and other distributions in respect of
such Equity Shares held by them. Further, the Directors may also be interested to the extent of Equity Shares held
by companies, firms and trusts in which they are interested as directors, partners, members or trustees and also to
the extent of any dividend payable to them and other distributions in respect of the said Equity Shares.

None of the other Directors have any interest in immovable property acquired or proposed to be acquired by the
Company in the preceding two years as of the date of this Prospectus.

For further details regarding the interest of our Directors, refer to “Related Party Transactions” on page 117.

As on date of this Prospectus, none of the Directors are interested in any contracts, agreements/ arrangements
entered into or to be entered into by our Company with any company in which they hold directorships or any
partnership firm in which they are partners as declared in their respective declarations, except as disclosed in the
section titled “Related Party Transactions” on page 117.

Our Company’s Directors have not taken any loan from our Company. Further, except as provided in “-Debenture
holding of Directors”, none of our Directors hold any debentures/subordinated debt in our Company.

Except Nizzy Mathew and Mathew Muthoottu, none of the other Directors are interested in the promotion of our
Company.

Except Nizzy Mathew and Mathew Muthoottu, none of the relatives of our Directors have been appointed to a
place of profit in the Company.

None of our Directors are interested in their capacity as a member of any firm or company and no sums have
been paid or are proposed to be paid to any Director or to such firm of company in which he is interested, by any
person, in cash or shares or otherwise, either to induce them or to help them qualify as a director or for services
rendered by him or by such firm or company, in connection with the promotion or formation of our Company.
Our Directors or their relatives have not purchased or sold any Equity Shares of our Company in the six month
preceding the date of this Prospectus.

Borrowing Powers of the Board

Pursuant to resolution passed by the Shareholders of our Company at their EGM held on December 10, 2013 and
in accordance with provisions of the Companies Act and other applicable provisions of the Companies Act and

111
 Muthoottu Mini Financiers Limited

the Articles of Association of our Company, the Board has been authorised to borrow sums of money as they may
deem necessary for the purpose of the business of our Company, which together with the monies already borrowed
by our Company (apart from temporary loans obtained from our Company’s bankers in the ordinary course of
business), may exceed at any time, the aggregate of the paid-up capital of our Company and its free reserves (that
is to say, reserves, not set apart for any specific purpose) by a sum not exceeding `3,00,000 lakhs.

Debenture holding of Directors

As on June 30, 2020, except as stated below, none of our Directors hold any debentures in our Company:

Aggregate amount outstanding as

Name of Director No. of debentures held on June 30, 2020
(in `)
Nizzy Mathew 550 5,50,000
Mathew Muthoottu 1,020 10,20,000
Total 1,570 15,70,000

Shareholding of our Directors

As per the provisions of our Articles of Association, our Directors are not required to hold any qualification shares.
Details of the Equity Shares held in our Company by our Directors, as on date of this Prospectus, is provided in
the table given below:

Number of Equity Shares Percentage of the total paid-up

No. Name of Director
held capital (%)
1. Mathew Muthoottu 1,47,79,912 59.23
2. Nizzy Mathew 33,54,446 13.44
Total 1,81,34,358 72.67

Changes in the Directors of our Company during the last three years

The changes in the Board of Directors of our Company in the three years preceding the date of this Prospectus are
as follows:

Name of Director, Designation and DIN Date of Change Reason

Mammen Mathews July 23, 2018 Resignation as a Non-Executive Director

Designation: Non-Executive Director
DIN: 01786534
Rajagopal M.S. October 8, 2018 Appointment as an Additional Director
Designation: Additional Director
DIN: 08114376
Krishnakumar K. R. September 30, 2019 Cessation as an Independent Director
Designation: Independent Director
DIN: 07771403
Jose Paul Maliakal November 18, 2019 Appointment as an Additional Independent
Designation: Independent Director Director
DIN: 07218120
Rudran Puthukulangara February 26, 2020 Appointment as an Additional Independent
Designation: Additional Independent Director Director
DIN: 00546638
Note: This does not include changes such as regularisations or change in designations

Key Managerial Personnel

In addition to Mathew Muthoottu, Managing Director, and Nizzy Mathew, Chairman and Wholetime Director,
our Company’s Key Managerial Personnel are as follows:

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 Muthoottu Mini Financiers Limited

1. Ann Mary George, aged 44 years, is the Chief Financial Officer of our Company. She holds a bachelor’s
degree in commerce from the University of Calicut and she is also an Associate Member of the Institute of
Chartered Accountants of India. She has 10 years of experience in finance and account and was appointed as
the Chief Financial Officer of the Company on May 30, 2016.

2. Smitha K. S., aged 47 years, is the Company Secretary of our Company. She holds a graduate degree in
English Language and Literature from University of Calicut and she is also an Associate Member of the
Institute of Company Secretaries of India. She joined our Company in 2015. Prior to joining our Company,
she was associated with Aspinwall and Company Limited.

For details about our Managing Director and Whole Time Director, please refer to “Our Management – Brief
profiles of our Directors” on page 110.

All our Key Managerial Personnel are permanent employees of our Company.

Committees of the Board

Our Company has constituted the following committees of the Board, which have been constituted in accordance
with the applicable law, including the Companies Act, 2013. The terms of reference of the following committees
are also in accordance with the applicable law, including the Companies Act, 2013.

1. Audit Committee

The Audit Committee of our Company was constituted on December 10, 2013 and was re-constituted by a
board resolution dated November 18, 2019.

The members of the Audit Committee as on date of this Prospectus are:

Name of the Director Designation Designation in Committee

Thomas Cherian Independent Director Chairman
Maliakal Jose Paul Independent Director Member
Mathew Muthoottu Managing Director Member

2. Nomination and Remuneration Committee

The Nomination and Remuneration Committee of our Company was formed vide a Board resolution dated
April 10, 2014 and was re-constituted on November 18, 2019.

The members of the Nomination and Remuneration Committee as on date of this Prospectus are:

Name of the Director Designation Designation in Committee

Thomas Cherian Independent Director Chairman
Maliakal Jose Paul Independent Director Member
Rajagopal M.S. Non-Executive Director Member

3. Stakeholders Relationship Committee

The Investor Grievance Committee of our Company was constituted by a Board resolution dated December
10, 2013, has been renamed as “Stakeholders Relationship Committee” as per the provisions of Section
178(5) of Companies Act, 2013. The Stakeholders Relationship Committee was re-constituted on November
1, 2017.

The members of the Stakeholders Relationship Committee as on date of this Prospectus are:

Name of the Director Designation Designation in Committee

Thomas Cherian Independent Director Chairman
Nizzy Mathew Chairman and Wholetime Director Member

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 Muthoottu Mini Financiers Limited

Name of the Director Designation Designation in Committee

Mathew Muthoottu Managing Director Member

4. Corporate Social Responsibility Committee (“CSR Committee”)

The CSR Committee has been constituted vide a Board resolution dated April 10, 2014 and was re-constituted
on March 7, 2016.

The members of the CSR Committee as on date of this Prospectus are:

Name of the Director Designation Designation in Committee

Thomas Cherian Independent Director Chairman
Mathew Muthoottu Managing Director Member
Nizzy Mathew Chairman and Wholetime Director Member

5. Debenture Committee

The Debenture Committee of our Company was constituted vide a Board resolution dated December 10, 2013
and was re-constituted on March 7, 2016.

The members of the Debenture Committee as on date of this Prospectus are:

Name of the Director Designation Designation in Committee

Thomas Cherian Independent Director Chairman
Nizzy Mathew Chairman and Wholetime Director Member
Mathew Muthoottu Managing Director Member

6. Risk Management Committee

The Risk Management Committee of our Company was constituted vide a Board resolution dated April 22,
2013 and was re-constituted on March 7, 2016

The members of the Risk Management Committee as on date of this Prospectus are:

Name of the Director Designation Designation in Committee

Thomas Cherian Independent Director Chairman
Mathew Muthoottu Managing Director Member
Nizzy Mathew Chairman and Wholetime Director Member

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 Muthoottu Mini Financiers Limited

OUR PROMOTERS

The Promoters of our Company are:

1. Nizzy Mathew; and

2. Mathew Muthoottu.

As on the date of this Prospectus, our Promoters collectively hold 1,81,34,358 Equity Shares, representing 72.67%
of the issued and paid-up capital of our Company.

Profiles of our Promoters

For the profiles of our Promoters, see “Our Management - Brief profiles of our Directors” on page 110.

Nizzy Mathew holds 33,54,446 Equity Shares amounting to 13.44% of our Company’s issued and paid-up capital
of our Company as on the date of this Prospectus.

Mathew Muthoottu holds 1,47,79,912 Equity Shares amounting to 59.23% of our Company’s issued and paid-up
capital of our Company as on the date of this Prospectus.

Interest of our Promoters in the Company

Except as stated under “Our Management” on page 108, to the extent of their shareholding in our Company,
corresponding dividend payable to them and to the extent of remuneration/sitting fees received by them in their
capacity as Directors, to the extent applicable, our Promoters do not have any other interest in our Company’s
business.

Our Promoters do not propose to subscribe to the Issue and none of our Promoters have any interest in the
promotion of the Issue.

Details of the Promoters’ contribution in our Company is as follows:

Nizzy Mathew

Issue
No. of Face
Date of Nature of price/transfer Nature of
Equity value Sources
allotment/transfer allotment/transfer price consideration
Shares (in `)
(in `)
March 18, 1998 Subscription to 1,000 100 100 Cash Own funds
MoA
December 28, Preferential 29,000 100 100 Cash Own funds
1999 allotment
March 28, 2013 Bonus issue* 3,333 100 - - -
November 26, Bonus issue** 4,761 100 - - -
2013
September 29, Transfer from Roy 33,16,352 100 100 Cash Own funds
2016 M. Mathew
Total 33,54,446
* Bonus issue at the ratio of 1 Equity Share for every 9 Equity Shares held by the existing Shareholders as on March 28,
2013.
** Bonus issue at the ratio of 1 Equity Share for every 7 Equity Shares held by the existing Shareholders as on November 25,
2013.

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 Muthoottu Mini Financiers Limited

Mathew Muthoottu

Issue
No. of Face
Date of Nature of price/transfer Nature of
Equity value Sources
allotment/transfer allotment/transfer price consideration
Shares (in `)
(in `)
March 7, 2008 Transfer from 1,000 100 100 Cash Own funds
Sosamma Mathew#
March 7, 2008 Transfer from 29,000 100 100 Cash Own funds
Sosamma Mathew#
March 28, 2013 Bonus issue* 3,333 100 - - -
November 26, Bonus issue** 4,761 100 - - -
2013
November 30, Preferential 13,50,000 100 200 Cash Own funds
2013 allotment
September 29, Transfer from Roy 1,22,90,000 100 100 Cash Own funds
2016 M. Mathew

September 29, Preferential 11,01,818 100 165 Cash Own funds

2017 allotment
Total 1,47,79,912
* Bonus issue at the ratio of 1 Equity Share for every 9 Equity Shares held by the existing Shareholders as on March 28,
2013.
** Bonus issue at the ratio of 1 Equity Share for every 7 Equity Shares held by the existing Shareholders as on November
25, 2013.
# For further details, see “Risk Factors - Certain of our records including in relation to share transfer to one of our
Promoters/Directors are not traceable.” on page 32.

All the above Equity Shares were fully paid up at the time of allotment or transfer, as the case maybe.

Other Confirmations

None of our Promoters have been identified as Wilful Defaulters by any financial institution or bank or a
consortium thereof in accordance with the guidelines on identification of Wilful Defaulters prescribed by the RBI.

None of our Promoters, was a promoter, director or person in control of any company which was delisted within
a period of ten years preceding the date of this Prospectus, in accordance with Chapter V of the SEBI Delisting
Regulations.

No violations of securities laws have been committed by our Promoters in the past or no proceedings are currently
pending against them.

Our Promoters have not been restrained or debarred or prohibited from accessing the capital markets or restrained
or debarred or prohibited from buying, selling or dealing in securities under any order or directions passed for any
reasons by SEBI or any other authority or refused listing of any of the securities issued by any stock exchange in
India or abroad.

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 Muthoottu Mini Financiers Limited

RELATED PARTY TRANSACTIONS

For details of the related party transactions of our Company during the last five Fiscals, see “Annexure VI (3)” on
pages F-68 to F-69 and “Annexure XI A & B” on pages F-132 to F-134.

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 Muthoottu Mini Financiers Limited

SECTION V - FINANCIAL INFORMATION

FINANCIAL STATEMENTS

No. Particulars Page No.

1. Statutory Auditors report on the Audited Ind AS Financial Statement of our Company for the Fiscal F-1 to F-9
ended March 31, 2020
2. Audited Ind AS Financial Statement of our Company for the Fiscal ended March 31, 2020 F-10 to F-94
3. Statutory Auditor’s examination report on the Reformatted Financial Statements of our Company for F-95 to F-97
the Fiscals ended March 31, 2019, March 31, 2018, March 31, 2017 and March 31, 2016
4. Reformatted financial information of our Company for the Fiscals ended March 31, 2019, March 31, F-98 to F-140
2018, March 31, 2017 and March 31, 2016

118
 Vf,shnu [Link] & Co
gff&l#'K
Chartere d. Ac c auntcrnt s
\d tui
l

Independent Auditor,s Report

To the r-nembers of [Link] Mini Financiers Limited

Rcpot l on tirr. AurliL ol l-lre [Link] Statenients

Opinion

We lrave audited tlte atcotL:1r:tttying firrancial slateilrents of Muthoottu Mini Financiers Limited (,,the
Company,,) which
comprise the Balarrce Slreel ;is at Marcll '31,'2020, the Statentent of Profit aucl Loss
[including Other Compre]re,sive IncomeJ,
the cash Flow stateirenl atici the statemellt of chatrges in Equity lol the year-then eucied,
a1d a s,nrrnary ol the [Link]
AccoLlnti ltg Poltcies utr(l orhcr. cxplanatory inlorntation.
ln oLtt'ollitttoll;lllrl to illC lrrst of our inlot'ntation and accorcling to the explanatiotrs given
to us, the aforesaid Financial
Stall'tttertls gi','c tlir.: irll()[Link]()rl rccluired by tite'Corlpartres Act, zot:
1"ttrc Act") in thelllanner so required and give a true
atlci fair vlelv itl corllt;rrtlir','r'r'jth thc lrtdiau AccoLrnting Stanclards plescriberl under
section 133 of the Act reaC with the
contpatties [lndian AccotLrrtirig Standards I Rules,2015, as amenc]ecl ("lncl AS") ancl
other accounting principles generally
accellted in Irldia, trl tlttr r-t:rir' of affairs ol the corrrpany as at March 31, 2020, and
its profit inclLrdirg other [Link]
tttconrc, its citslr floivs ,triri Lli(r cli;tnges rn er1uit.1, for the year encleci on that clale.

Basis for Opiniorr

we ct;llclr-tclccl oltt'aLrrirt r-rr tlrc Fitlartcial Stalernents in accordance with tlie Stanclards on Aucliting (SAsJ specified r-rnder

rclet'lrttl to oui arr(lit or'llr.' litrartciai slalclllents urtder the provisioirs ol the Courpanies Act 2013 and the Rliles
madc
Ethrcs we belicve ihal tiir'.rtttii'i cviclettce rve h:lve obtarnecl is sulficrent ancl appropriate
to provide a 5asrs lor our opinion on
Llre r, iltJnctJI [Link].

Enrph:rsis of Matret.

wc tir';rtt' attenlioli til ilri tiri l:r|lttlon lty thc worlcl Health 0rganisatiolt on 11 March 2020,
oftlrr] Novel corona virus (covlD
19) oLrtb|eal< as ii [Link](1erlr,r. 'l'1te itn;ract of ancl uncertailtty rclate(l to the COVID-19 panciertrrc lras ltccn iclentified
ai a l<ey
cLlslur)lers ancl tllcit riLlrlity Lti I epay titc cltres The nr.]nagerrcnt has tal<eu a
thorough analysis ol the possiblr. impact of the
pattrientic ancl has cottt:lrtrltti that tlte CovlD-19 pandenric rnay have
an lmpact on the Courpany's fiuarrcial performance
nrr)ilili',d irt |'r'sl)r.1 r ()r rrl, .,t..,v(,nr:ltt,,t.s.

I(ey Arrdit Mattels

I{ey i\Lrdit Matters ,tte lllosir irllllters that, it} our

ltrofessional judgentcnl, were of rnost significancc in orrr aLrdit of the Irinancial

tlte nlatters descrilrecl bclow'as the l(ey Auclit Matters to be conrrnunicatecl in [Link] report.

1\rrLiit Matters Audit procedures ado

lll-d
'1'lte ^Srlu!rc]]le
! -lil!r!.rl o Wr,hilr,,e ve|iiied lhe nrinulos oi the Aridit Contnrittee,
Conrparry has atloprcr Lirl ltrclratr Ar:coLtnting [Link] \,vitli tr-.g:ird lo the approval ol the choices nrade and
("lnd r\S"J effcctivc floi;r 1,,i\prit 2019, as norified by the
exclnptiolls clainrecl by lhe e oilltany tbr rhe transition
Nlitrisir'1, of Corporatt, rr,[Link]:; rvrth the ti.;rrrsition clate as I.i
Lrndel' lncl AS 10 1.
t\pril 2018.'l'hc iLnp;rcr ol iirr [Link] is rrreinly on the
firllowing areas:
e llvuluatccl the managenlent's tt ansition date choice
o Classification, r'ei_ognition, treiisurelrent and runcler Ind AS 101.
ilisclosLrle ol iiit;rlcial Asscts and Financiai o \,Ve Itrve reviewed thc rransition cjare adjustnrents
l,iab ilities, ntade to
girre elfect to the change in accounting
u|enlcrlt 0l fiaritervork, unrlcr the previor-rs GAAp to the nerv Ind
irE litr;i;rir-ntcnI on lrirranuial Assets
(iretiit l.r,ssJ,i\ccounting ior Loait AS Irramtrvorl<.
zs Fees anci
{;
.F. on Finulcill l,i"rl)iliiies,
!tn
\;' FRN 004741's
F-1
Floor, CSI (.lornmercial Centre. Baker Jr-r., p. B. No. 227,I([Link] - 686 001
I Te1: 0.1t1 r,t.l3 ri,9q, 258tgqe ltr,lob; 9349870062 I ]Irnail : l<ottayam(rr,vr:c. [Link]
1
I

K"'.i";; i-tt ;sl l;;;i 'I i'i,",ancliuln I EltLLr-n:inoor- | tiochi l(annur' I Calicrrt ] Cfrertnai
lll]J): / \\'.\\\.\ t( .(,,.il1
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 Vishnu &"ajendran & Co 1

Chartere d A ec [Link] i

Note lll to the Fi nlr rtrti:r I Si.r r enrents Sign it,i,,ani [Link] ti ng
Poiicrcs and Recent AcctrLnilitrg pronorrncentents discloses
detuils olthe transitio, in)][Link].. the [Link] statenrents.
As the lransition irtrlt;rr:l jrrvolves a significant clegree of
managelrent judgentent arrti l<ey assuntptions on the above
nlal[ci's, rvc have irienLirie,i tiirs as a l(ey Alrdit Matter,

lutpa irrl ent Loss l\li orv;11 cr, . Wc obtaineci ar)

Managerlent's jLrcigitrell:; ir, the cali:uiatiotr of inrpairnrent
understanciing of rnanagemenit
assessritent ol inrpairrnent of loans and acivances including
aliowances having:r >^ignificant impact on the financial the Ind AS 109 rmplementation process, internal ratin[
statcntents, is inr:lLLricri irr tlrc sigrrificant ilccour)tirlg policies ntodel, [Link] allowance policy ancl ECL nrocielling
as srated in "Note No, III- lJ to []te Financial Statenlents,,..fhe
methoclology.
estilnates regarciing inrlxrir-ntent allowances are complex . We assessed the design and rmplementation, and testecl
and reclr-rire a signifiL:aut rtegree of jLrclgentent, which the
iircleasod rvith irripler,[Link],,1 llxp.,.te.1 Credrt Loss
operating cff'ectiveness of controls ovcr tlre ntoclelling
process including governance over. nronitoring ol the model
("lr(ll-') approaciL as [Link] by lnd AS 109 rclating to
and approval of i(ey assLlntptiolls.
" iri n a rrcial ilistrL1 r n c [] i:i.'
. \\ie also verilied the l<e1, jr_rrigernr_,nts anri assuurptions
'Ihc. N'lelagernent is [Link] crl Lo clctermine tltc
ECL lhat rnay relating to the ntacro-econollic scetrarios inclurling the
oc('ul ovet either u 12-rrtontli lteriocl [Link] [Link] lifc. oi irlpact of COVIII 19 Pandemic and tlre ;rssociated probability
ali asset, depenciirrg on thr i.t:tl-egortsalion ol the incliviriLral weights.
asset. 'l'he key area:^ ol lrrigenrent inclucle: . We also assessed the approach of the Company for
1. Categorisation of loans^ in Stage 1, 2 ancl 3 based on categorisation of the loans in v:nous stages reflecting the
ideutificatiorr ol: rnherent risl< in the respecttve loans,
:r.) cxllosur,cs rt,ittt sigrrificant incrcasc in creclit . For a samltle of linancial asscts, we tested the correctness
rish since tlteit. L;[Link] ancl of Staging, reasonableness ol pD, accuracy ol LGD and ECL
b) Incliviclually inrl;rLir-cri / def:rult exposures. comp Llta tion,
'2. 'l'cchriclucs Lrscri Lo (lcterntine Loss Given Default . We have also verified the contpliancc of the circulars issuecl
('i,CD') anrl l:,r.o[:ririirrv of Dcfarrlt (,pD,l to calcu]ate by the Iieserve Banl< of India fronr tinte to tlnle chLring the
:rrr l:(.L lta:L'.: r, I r).r.t .\,1!.tiell(.r.
year 0u ihis sr_rbject,
3. 'l'hc intpacl ot [Link] future macroeconontic
conditions in the [Link]-rination ol ECL.
Managetrlent has tnaric lr nLrrnber of interpretations ancl
asslurlltions rvherr tiesiilnr r i;1 :rnd irnpicrut:nli ng uiodels thal
are cornpliant witl) tltc [Link].'l'lte lJuar-rl ut [Link] has
opted the provision [Link] IIIAC nurnrs as the ECL
plovisiorr for lhr. yilir, I)ciLllt [Link], [Link] llrc ECL provision
a,cl the IRu\C prLrvisi... 'l'ltir :tccLiracy .f rlara [Link] aucl tlre
irnplelllenlation ol relrtcrt corrtrols are [Link] for the
integrity of the itrrpairment provisions, Civen the
estjruat-rrr1
siguilicance of jurlgeirrcrtits .irril the high coruplexity related
particulariy to thc. culeirlrtron of ECL, we constclereci this
alLrJ lrs a l(ey Audit N4aitLcr..

Infb r'rrratiol other''l'ir:i n Iri nii ncial sta tements and Auditors Report [Link]

in the Conrparly's Artllirai llc1tort, but cloes not inclucle the Financial Statements
and our report thereol,
otir'0pinion otl the f itrattci:r1 sliltelrents cloes not cover the other infbrrration ancl we
clo not exprcss arLy fornr of assurance.
Itt cortttectiotl rvitlt oLtr':rlrriiI oll tltt'Firrancia] statenlents, our responsibility
is to reacl the other infonnation made available
attcl, itt cloing so, consitier vt'ltcther thc other inforrration is nraierially
inconsistent with the [Link] Statements or our
l(ll()\vle0lje otltlllnL'd ill tItc,tLrclit or ot-ltr:rwise appears to be rnateria]ly rriisstate4.

Manageruents Responsi bili ty foI the Financial Statements

EN
ii_

FRN 004?415
F-2 Jn., p. B. No.
F 1oor, CSI Cornmercial Centre, _Baker
227, I(otta\,am - 686 001
el: 04Bl :2:J01q99, 2581999 lMob 9349870062 ltrmai1: kotta; am..r vr('.co. in
I

I(olta\,aITl1l3ilrlg;r1llr.c|.1-ril,anc1rum|Etlr'rmanoor|I(ochir@
Ltrp: \\\\\\.\rc.L.().ll)
 Vishnu Kejendran & Co
Chqrtered Aceountants

preparation ancl llresetltlrlitrtl crf the [Link]'tl

statenreat that give a true and fair view ancl are frec. from material
misstal-enrent, whethel ti,re ro [Link] or clror.

goitlg concertr' disciosir'';i, :rs allplicablc, nrattL'rs

relatecl to going concern anci usin[ the going concern
unless matlagelnellt either iriLetids t. liquiclate the "o, basis fbr accorinting
cornpany to ..ur. operations, or has no realistic alternative br-rt
The lloa.d of Directot's ;rtr' resportsibl. to do so.
''ls'r iot overseeing the co*pany's [Link] reporting process,
any ol the covlD-19 pariclcttric on the iittaitci.l staterrents ancl assess the impact if
oi the ionrpa.y. As the niatter ilas [Link] [Link] examined
[lte tlrattagctllellt to (leci(i(' LllaL t]ic.c is rrrr tlrreat by
to rlre going collcer. statlis as of now, we have nothing
nlal tler. to .epoft on the

Auditors Responsibilities for the Audit ol the Financial

statements
out'responsibilitre's arc [r) (lo'sigll sLrrtable auciit proceclr,rres
to obtaiu reasonable assurance abor-rt w]rether the
statelltents as a n'lloie at e f,'ct'fl'on, ntate ,a1 .ri;statement, Ind AS Financial
lvhether dr-re to frauci or error, a.d to issLre an auditor,s
includcs our opittiort' lleasottal,le assLlr:lrlce ls report that
a high level ol urrr.r,,.a,-but is not a guarantee
accot'datrce rvith sAs wiii irl\!ays cletect a ntirtertal tl);rt an audit conducted in
r,isstatenrent whe, it exists. I\,risstatements can
arise f.o,r fraud or error
decisiorrs of the usr:rs [:lii'. ,rr, rh. blsLs.] trrcse [Link] State,enrs.
fri5,iiilllil,:.Il]:lilirlilili;] "rvithstarrtiat'clsonaucliting,[Link],rdproressionarsr<epticism
aJ Identify lttld al;sess rhe rrslts oi lraterial IlrisstatL'rlent
of the Fi.a,ciar Statements, whether due to lraud or
desigrr arrc{ periot'ttt audit proceclltres responsive error,
to those risl<s, and obtain aLrclit evidc.,ce thar is sulficient
appropriate to llro'icie a basis fol',ltr opinion. The ancl
risl< of nor clete cting a material misstatc,)e.t
is highel'l-h'ttr lot'orle resultittg frotn error, as fraud may res,lting fronr fraud
involve collLrsion, fbrgery, intentional o,issions,
rnisrepresenrarion:;, or irrc [Link]
()f ilrtenral control.

approprLiltt) itl ih. t it't:tt,lslilllce\-. [Jrtdi-'r section

143(3](il ol the Conrpanies Act 201.j, n,c are also responsible
cxplos:^illH [Link] opitti,tl ott wlletllt:r lhe cotttpany for
[Link] internal linanciai [Link] systel,ns
[Link] lq llfr,( r:i\,(,r lL,ss of sLrclt cot I tlols. in place and
cJ Ilvaltlate tlle :ilrprt;'[Link] of itccoLrtti.g policies^
usecl arcl the reasorablcness of tlle accounti.g
related [Link] ntade by nlanagcnlcltt, e)^tirnates ancl
d) conclucleotltht''r1'It'rt1lt'iateressut,lr.r,[Link]'sLlseof
thegoingconcernbasisof accorllltingancl basedonthe
ill-ldit evi(l'rllct: .btltittecl' rvhctht'r'lt tttaterial
unccrtainty exist"s relatecl to events or [Link]
signific:lllf ilOrilrt oit tlle (-oitlllarllr's rbility to con[ii]uc that rxay cast
as a going concerr. If rve conclucle tlrar a rnateriar
cxists' w. ill'e l('tltriretl to tlt'[Link]. in our uncertainty
auclrtor'[Link].i to the related disclosr"rres a.s [Link];uate,
oLtr ollirli,rl ()ltt rrtrttclusit)lls itl'e llitsed on the to rnodify
auclit evicle,ce obtainecl r-rp to the (late of thc arditor.,s
Horvevel'ltllLil'i't'\'()lit5- or conclitiOrts nlay cause the conrpany to cease to report.
cor-ltinLle
as a going conce rn.
eJ HvalLtate rlic o'''el':lll prcsentatiolt, s!rLrcture ancl content of
the fi.a'rciar statements, inat.-i ri,rg the disclosures,
r'rrllether tilc i'i;larlci:t1 statetltent lePr..sents ancl
the unclerrying transactions anci events in a [Link]
presentalior). that achieves fair

we corntltiLt'iicirte \villl those chlllilu(l [Link]

regardirg, amo,g other [Link], the [Link] scope
of the aritiit artti si;lrtiiicant [Link] and timing
i, irternal [Link] that;. t.i";,,:d;,;;,,;;"o,, ;; ,i,;
we also 1rt'ovirie Litose charge'tl rvitil govenrance wrth a statenlellt that
reclLttretlletlts Ii:gaItlirlg iltdepcnrlcrtcc, and we have cor-Dpliecl with relevant [Link]
to conrmunicatc rvith them arl relationshifs:incl
reasorlallly br: illoLrgltt to beal on oLir inclepencience, other lratters that may
ancl where applicable, related [Link],arrls.

Report on Other l,egtil eiiti liegulatory Rc(luirL,ments

loor', CSI Clrrrnmerciitl Cenlre, Bal<er Jn., p.

13. No. 222, Kottayam - 686
F-3
0+81 :130 I 999, 2S8 t 999 | Mob: 9349870062 trmai1: [Link](4vrc. 001
I co. in I

I(otta5,anr 13an51rLlrrr.e 1 [Link],-r.t.,_i- I Ott.,-rno* I l(annur I Calicr,rr I Chennai

http:/ /w"[Link] l
 Vf,shnu Rajemdrwra & Co ffel
Chartered Accountants #d'ei
&..g.\Bi
1@ \ts

2. As recluiretl hy tJre NLrrr-13anl<ing l'-inanri:rl (iornpanies

Auditor's Report IReserve Banl<) Directio n,.2o16,issued
ReserveBanl< of lnrli'rinexerciseofllrepowersconfc'rredbysub-section(lAJolSection45NlAoftheReserveBanl<of by the
India Act' 1rl'J4, tr'. gr','c irt tllc "AtttrerLt't' 2", an aclciitional
Audit Ileport adclressed to the Boarcl of Directors containing
ouf slll[t t]l t'l I I s,r, t,il 1.. I II:i tl1,rs s1Iet.i i Ir:ti t]tr,t t:iit,

.1, r'\s reqLlilL,(i t,y :jer t j(,u i,1,3 [3] oi tltt, ;\ci, [Link] report that:
a we llrrve sor-rglii :rrl11 obtaitrt:cl all tlre inforrnation ancl
explanations which to the best of orrr l<irowleclge ancl belief
wet-o ili clsi.t,l.J, iul tlte [Link],Lrl our aLtClit;
b' In ott..lritliotr' pro]ler bool<s of account as required by law have been l<ept
by the cornpany so far as it appears
frolrr iiLrr [Link]-r of lhosl llitoks;
c No reJrot't oll lllc llccotttlts of ltny oi the'branch oirices
auditecl Lrncler subsection B of seetion L43 byany person
Itas btc'tl r't'.:irir','ti lr',' Lts atrti thclolirlr'r1o corunrelrls
neccl to Lre rnacle on lhe iratter
d The brtlattcr'slrcet, llte stitLerlluttt.1'profit anil loss
Iinclucling other corrprehensive Inconie), the cash flow
statell)('llt liritl llle statellltlilt oI cJl,tiges in eqr-rity ciealt
with uy tnls report are i, agreement rvith the books of
lt cco LIu t.
e' In ottt opLtllOtt' [Link] aforesaitl lirt:ttrcilri statenlents colnply lvith
the Accour-rting [Link] specilicd under Sectjon
13'J ol thc Act rc:rri rvith the cotttll:rrres (lndian
Accouritiirg Stanclarclsl Rules,2015,;-rs anrenderi.
lrasis irf rhe rvritten rt'presonr:rlions received [Link]
' 3.'] .t'""
i* ,1i...*i, ,, on March -J1, 2020 anci taken on record
rr'] rir eclors, rront'or tlre directors is clisqualiiiecl as on March
:11.,:ll:..1 ll:'ltr :r;:,rI
(IIIIr{|.'r,.I'.
3r,2020, fronr being appointcd as a
.r,rI..rt, .,,i,_t,,t t|t,,.\,t.
g lll oLir'olrilli()rl thct'e at'c tro qLt,tirlicattor)-s, rescrvations or:[Link]
rcnrarl<s reiating to rhe rraintenarce of
ac( o u rilri il
I ( I i)li tt. ntattets
I r c{)lt Ilcatc(l tlt(]rewitl.}.
h' witll luslle('f t(j llle ailcclu:lc)1 (rl riL(' ilrternal f inarrcial contrOls
over financral reporring of the company and the
opc|[Link] er'tt'.r,r,erress of sLrcrr (rortr,ols, [Link]
our Report in,,Arrnexure 3,,
i with tcsl)eLi l. t'116 m311s''s t, bt' inclucled i, the Auclitor's Report
in accorclance lvith [Link] Rule 11, of the
cotrpalriels (ALrclit and Atrditors) IlLrle, 2014, in our
[Link], and to the best of our inlo,.atiorr and accorcling to
expI,r0,rIiOri.; tii\.(,lt to Us:
i rlrt'foirll)itrl)' lrl's iiisr:lostrti lire ttrrpact olpendrng litigations on its financial
ii position in its financial stater-nents.
t' ti(rl lt'tirL''tttv lotrg-lt'r ir) coriuails inclLrding clerivative
contracts fbr which there ,,vere any [Link]
,'Jl:ll'
iii l\i c'rrilttrl' to the irlforilt;ttioiL pIovrcled there are rlo amount)^, requirecl
to be tr-ansferrccl by the company, to
ihe li,r,tst,rr [Link] arrd i)l irttcriolr Furtri.

For Vishnu Raiendran & Co.

Cliarteled Accountants

PIacer: Kochr Abraham, FCA

Date: f uly 20,20'2t) r
Nlembcrship No:208529
IJDIN: 2020B529AAAAAB99S2

w
i( rnuoo4741s ) I

?.,1 F-4
Fioor'. CSI itrtrrmerciirl (lcntL.e, Bakcr Jn., p. B. No. 227, Kottal,arn - 686 001
lTel: 0.181 :l.J(it!l(19, 2:;81999 j[{ob: 93119g7006,2 lEmail: [Link](rrlvrc. co. in I

[([Link] I ;i,iu,n,,,,i.,.,,,,
11,,,r1,.,,i,r,-c 1 i ,i r,-""r"iii".lrl Iiannnr I Calicur I C;r-*^f
lr [Link]:/ / u'rvlr,.vt-a. co. ir)
 Vishnu Kejendrarn & Co #*
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Aa
gsa
Chqrtered Acaountants
w'$r
AF"B
/

Auncxure 1 to the [Link].'s lleport

The Annexure 1 ref'crr|rl to itl our report to llre members of Mr-rthoottu Mini Financiers
Limited (the Company) for the year
encieci ou NIalch 3 t, 2020. \,Vc [Link] thilt:

a) The Corrparly 1s rrtaittt;litling pl'opoI rct:oIcls shorving lLrll particulars. [Link] quantitative cletails
and situation of
fixed asscis.
b) Accorclilrg to tlte rrllortltatiolt attci crltlarr:ition providecl by the Nlanagetneltt, the Conrpa,y has a regular programme
lor the verilicalit;ri ol its fixeci asstt. in olir opinion, this periociicity of physical vcrilicatro. is reasonable having
regarci to lltrl sizt'litlri Itature of tltr (iorlpany and the nature of its assets" pursuant
to such progranlme, a portion of
sucl-t flxci] .lss^t-rls il;rs been physicali;' vt'rllied by the nranagernent during the year
ancl po material rliscrepancies were
noticed on strclt vet iltcation.
cJ In otLl'opitriotr litltl llctLrrtiitlg ro rlt(, inlirrrnation artrl expJanalion given to US, the titie deeds of
imrlovable property
are hclcl il llre [Link] ol tlre [Link].r,.
ii. 'l'lte CoDrprrny is .t iL,r'\,icc cunrl)llJ,, [Link],tly
[Link] financial services, Accordingly, it cloes not hold any physical
inrrentories.'fhrrs, ltarrgraph 3[ii) r;,i tht: [Link] is not applicable.

iii The [Link]:ry h;,ts ttoI g|antecl ]oltits, si-'cLtteci or unsecur-ecl to Cornpanies, lirnrs or
other parties coverecl in the
registerttt:titit:titrr-ti underSection liJgof rheCompaniesAct,Thus,paragraph3[iiiJoftheOrderisnotapplicable.

it'' ltl ottt tllritliotl

aiiLl lrccttrtlirlg to llrir inlolrnation anci explanations given to us, the Compa,y has not given
any loans,
tlratle atty iilveitl)re1lts, llrorriilerl rny BLril|ailrces, anrl given any secul'lty to rvl'rich
the provision ol Section 185 and
186 oltlte (iomprrrir:s r\ct are a1;[Link].

v ln ortr optrtiotl rtrrii ltccording to the inlorru:rtion and explanation given to us, the Conrpauy has not
accepted,any
deposits artl ar:r'orcliirgly [Link] .3[v) oithe order is not applicable.

vi Br:ing a Norl- l3arll<itrg Finance Conrpany, maintenance of cost records has not
been specilied by the Central
Governnrent lrrrdcr'sLrb-sectiotr [1J of [Link]] 148 of the Cornpanies Act. Thus paragraph
3[vi] of the order is not
ap plrr:a b ie.

vii.

al f iic Ci;tt;1r,itlv is t-egttl:tt'irr cit'lrositing unciisputed statutory clue;^ inclucling provici..nt firnd, employers state
illsLit'ltittri:, ittccltlre lax, s:tlts t;tx, $realth tax, service tax, duty of cLrstonls, duty
of excise, value added tax, cess
atlcl attl' ()lllL'r statutoly cltLes \viti) the appropriate authorities. l'here are [Link]:lrs
of statutory dues as at
tlre last dry ol the finattcill yc:rl concerneci for a periocl of more than six nrolths 116nr
the clate on which
the1, lrecri rre payable.

b] Accot ciirrg to tllc intblrlliiliott rttrtl cxLllan.'ltions given to us and the records of the Cor,pary examined by us,
tlrt-'i e at'e tlt) .itles of tltcottte lax, salcs tax, service tax, clLlty of cnstonts, duty ol excise and
value addecl tax
rt'llicll it'tvtl llot beell tlel;rrsilctl oll [Link] of any rlispute, except the amounts disclosed in.
Note No. 14
(-rrrrtirLurrrrt [Link], [Link] [Link]'t ol rhe Firrarcial
staterneilts,
vlll. In ottr ouiltiotl :ttril :tccording to tlre lrrtir|nration and explaration given to us, the Compar-ry
has not defaulted in
repaymcnt of dtrc's to a financial irlstittitiou or bank or clebenture holclers during
the period.

tx, Itt oLtl'o1-ritriotr atrtl accot'ditlg to thl inlirIrnatron ancl explanations giver-i to us,
nroney raised by way of firrther public
of'fbr anrl Privatc Placenlcttt olclelrt ittstrLrments, securitization olgolcl Ioan
by r,vay olclirect [Link].t anci issue of
pass throLrgll ct'rtiilcates antl tcrnr lortrr olrtaineci have beeu appliccl by
the Company [Link] rhe yea. for the p,rpose
fbr lvhiclr Lhcy l13yil lruotr raisecl.

Accordt|rg to lht'iltf'ornlatiott attcl e.\pllrlirtions giver) to us, fraurl on the Corrpany

by its officer.s or enrployees has not
been nollci,ri.

9o
fi 3.,1 Floor, CSI Commercial Cenrre, BakerJn., p. B. No. 227 , Kottayan-r - 686 0O I
F-5
lTel: O,iS I 23U 1999, 2581!rijg I \4ob: g34gB70062 I Email: kottayam(r][Link]
-**./ I

Ko1 [it)am l [Link];1-11,'lr',: ]TI'[Link]] LittrLmanoor

ll(ochi I I(annur lC:i1icr_rt. iCn"n""i t

.. r rp: / /rr ri u .vr.t'.co. in

 - .\,
Vishnu Rajendran & Co
'

ff&"
Chqrtere d A c c [Link] 6 a
/'&"
B. .g
9\w

&d r&\B
xj Accorciing to tho clocttnlents provicled lor our verihcation, rtranagcrial remuneration has been paid in accordance
rvith the recirtisite approvals Inanclated by the provisions ol Section 197 read with Schedule V ol the Companies
'20
Act,
13.

XII. As the Cornpally is uot a Nidhi Conrpany, paragraph 3 [xii) ol the Orcler is uot applicable.
xlIl. According to tlte inforllratiorl and explanations given to us ancl based op our exarninatron of the records of the
Companl', trarlsaclions '"vit1t thc |elated parties are in compiiance with Section 1BB of the Cornpanies Act, 2013
and
the details oi such transactions have bce n disclosed in Notc No, I( in the linancial staterneltts of the Company as
required by the alpiicable lncl AS.

xlv. According to the iltfblnlation ancl explailations giver-r to us and basecl on our examination of tlie records of the
Con]parly, tire Corltpany ilas Itlade private placement of securities dLrring the year under review, has compliecl
with
tlle requirenlent of section 42 of the Cotnpanies Act, 2013 ancl the amount raised l'rave been used lor the purposes
for
which it w'as raised.

xv, According to the inforlltatiort arld explartations gtvcrl to r-Ls ancl basecl op our examit]atiop of the records of the
Company, the Coirpany has ttot cnler'o(l iulo non-cash transactions lvitir the clirectors or persons connecteci
witl-r
tlre n.r. Accoldirrg1.,,, paragraph :3[xv.) of tlre orclerr rs not applicab]e to the conrpany.

According to tht: inforlllatlol'I alld e'xplanations given to us ancl basecl on our examination of the records of the
Company, tlte Colrpany has obtained the required registration under Section 45-lA ofthe Reserve Bank oflndia
Act,
7934.

For Vishnu Rajendran & Co.

Cha rtered ntants
FRN: 004

Abraham, FCA
Placc: Kochi Partner
Date: lrLiy'20,2020 Merlbership No: 208529
N: 2020B529AAAAi\899 52
LI D I

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3,d F1oor, CSI Commercial Centre, Baker

F-6 Jn., p. B. No. 227, Kottayam - 686 001
lTel: 0481 2307999,258IC)99 lMob: 93498T0062 | trmai1: kottayam(4\/[Link] I

Iiottayam ! B:urgalore lTrivandrum] Ettumanoor I I(ochi | I(annur ] Calicut I Chennai

I

h ttp: / /rvrnr,.[Link]. ir-i

I

Vishnrx K,ajendran & Co #

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Char-t e r e d A c c ounta:nts kd
'w\t \& I

Annexure 2 to the Auditor''s Report

To the iloard of Drroctor's of Mutl'roottu Mitri Financiers Limited,

We havc anditccl the ljali|rce Shect of Muthoottu Mini Financiers Lintited for the year enclecl as on March 3L, 2020, the
Statement olProlir;tttrl Loss (lncluding Other Comprehensive Income), Cash Flow Statement and tl're Statementof Changes i,
Equity for the year ti'iert ernded annexed thereto. As required by the Non-Banl<ing Financial Cornpanies Auditor.s' Report
(Reserve Banl<) Direction,2016, and according to the information and explanations given to us, we provide herewith, a
statenlettt on the nlatter's specified in paragraphs 3 and 4 ofthe aforesaid directions;

i. 'l'ite cotlil.r;irry
is eitgagecl irr the br-tsittess ol Non-Banl<ing l..inaucial lustitution ancl it has obtainecl the certificate of
registretiorr as plovrded in sectiolr 45-lA ol the RBI Act, 1934,

ii, 'I'he [Link] is t'rttitlecl to contrul.r to Itold the Certificate of Registration

in terms oi the Asset/ lncome pattern as
on N4alclr':l7,20'20.

iii, 'l'he Board ol IJrrectors of the Company has passed a resolution for non-acceptance
of public cleposit.

iv. Tlte Corrtpatty ltas rtot acceptecl any pLrblic cleposit clurrng tl-re perioci unde r review.

v. Accordirrg to lhe irtforlttatiott ancl explanation given to Lrs, tlte Cor-npany has complied with the pruclential norms on
lncotne Recogriition, Ittdr:rn Accourtting Stanalards, Asset Classification, Provisioning for bacl ancl cloubtfll debts as
specilii:ci itt the directitttt [Link] by the Reserve Banl< of India in ternts ol the Mastel Direction - No1-Banking
Fiuancial (lonlpany - Systemically ln)portant Non-Deposit taking Company and cleposit tal<ing Cornpany (Reserve
Bank) Dili:ctions, 2016.

vi The capilal atloqLracy ratio as clisclosed in the return suburitted to RBI jn terms of Master Directiol - Non-Banking
Finattcrrl (lorrtlrany - Systernicalll, lnrportaul Non- deposit tal<ing Company ancl Deposit taking Company (Reserve
BatlkJ Directlorr, 2016, i'ras becn correctly arrivecl and suclt ratro is in compiiance rvtth the milimunt CRAR as
prescriLreil by the Reserve lSanl< ol India.

vii, 'l'he Cotltl;rrry has lrrrrtislted to RIjl thc annual staterrent of Capital [Link], risl< assets and risl< assets ratio r,vithin the
stipulatecl lreriocl.

viii, TheContpanyhasrrotbeenclas:^ifieda"^NBFC-MFI fortheyearendeclMarch3l,2020.

2016 and is isstrcd lrr llrc lJoard of Direr:tors o1'the Conrpany as required by Palagraph 2 of such clircctions apri should not be
usecl for any othel l)url)os(r

For Vishnu Rajendran & Co.

Chartered Accountants

Abraham, FCA
Placr:: I(or:hi
Date: luiy 20,20'2A Menrbership No) 208529
UDIN: 202085 29AAAAAB9952

F-7
3.d Floor', CS1 Commercial Centre, Baker Jn., P. B. No. 227 , Kottayam - 686 001
lTel: [Link] 1 2:J01999, 2581995 I Mob: 9349870062 | trmai1: kottayam@[Link] I

I(ottayam I l3arLgarlore I Trivandrum j Ettumanoor I I(ochl I(annur I Calicut I Chennai

I I

lr r tp: / 7 rvwrv. vn.. co. in

 VishnLn Kejemdram & Co .F*A
gE\B) I

Chart ere d Ac c [Link] ft S\E

ks K i

Annexure 3 to the Indcpendent Auditor's Report of even date on the Financial Stater,ents of Muthoottu Mini
Financiers Limiterl f<.rr the year ended 31 March 2020

Repol'ton the Intcrtr:rl Fittitticial Controls rvitlr ref'erence to the aforesaid Financial Statements under Clause (i)
of Sub-
section 3 of Sectiorr 'l'lli ol the Conpanies Act, 2013 ("the Act") (Referred to in paragraph 3[h) under Reporion
Other
Leg,l and Regulatory i{[Link]'s^ection of our report of even <Iate)

Opinion

lVe have auclited tile iitternal financial controls over financial reporting of Muthoottu Mini Financiers Lirnited
[,,the Company,,)
asof Marcli 31,'20)o irrcorrjrrnctioltrvithoLtraLltiitof thefinancial statenrentsoltheCornpatryforthcyearendeclonthardatL.

colttt oi ovel' fitlatlciel rcllol tillg criteria established by the Conrpany consiclering the essential cotnponents
ol internal control
slato(i ill the guicllilte rrot,: issrred by lhe I(_r\t.

Management's Resporrsibil ify for Internal Financial Controls

The Coinpany's tl)ALtllgct-tlctll is respollsiltle tbr establishing and traintaining internal fiuancial colltrols baseci on the
internal
control over finartcilrL reltoriing criterja establishecl b), the Contpany consiclering the essential conrltonents of the internal

acletlLtlttt'internai iillrtnL:j:tl colttrols that \,\'ere o[]erating elfectiveiy for [Link] thc. oiderly art6 efficrent colduct
of its
errors, the accuracJ arrti c,rtripleteness of the accounting recorcls, ancl the tinrely preparatron of rcliable linancial information,
as reclrrired under tlre [Link] Act,201.l

Auditor's responsibii ity

0ur resporlsibillty is lo Lrxl)l'css atl opittittlt cttt titc-'Contpany's internal fiuancial [Link] over financial reporting based on our

rcporlirrg I llle "CLritlanee Nore''] arrri tlte staudards on aucliting ["the Stanclards") issuecl by ICAI aucl deemed to be prescribed
uirclot'Sectiort 14-j(10) oi Lltt: Cortlpatties Act, 2013, to the extent applicable to an luclit of internal ijriancial
co,tiols. Those
Stancla|cls and Gtiiilalrt:t-' Note reqLlire titat we comply with ethical requirenrents ancl plan alci [Link]-n the
audit to obtain
reasonable assllrzlltco aboLrt whether adequate internal financial controls over financial reprtrting was
establtshecl and
maintained and if strcl'r coritlols operatecl eflf-ectively in all material respects.
Our atldit ltrvolves lrctlirIrlritrg proceclures to obtairl ar-rdit evidence aboul the [Link] of the internal linancial
control system
over financial repor'tirlg irrrci their olleratirlts ef'fbctiveness. Oul auclit ol internal linancial controls oyer finaucial
reporting
weai<ttt'ss cxists, alld tcstillg aud evaluatillg the clesrgl aucl oi)erating eflectiveness of ipternal coltrois baseci orr assesseri risl<.

tlte f irrlrrcial stutelrr,nrs, r,viri,ther due to 1i-:rLrcl or [Link].

We belreve that tlle litLtiiL e t,iclence tve have obtained is sr-rfliclent anri appropriate to provide a b;rsis lor oLrr audit opinion
on
the Conrpany's iutclrrai f irrancial [Link] over linancial reporting.

Meaning of Intelnal tririlincial Control over Financial Reporting

A Conlplrtrl"s ttlttli ttal lirrlritcral corltrol otrer financial leporting is a process designecl to prorrrdc a [Link] assurance

policies and procctiurt's tlrirr

i, pertain to lll. llrairllenance oi rccorcls that, in reasonable detail, accurately and fairly rellcct the tralsactions and the
disi'ro--itittns of the assets olthe Company;

7oo Contpany; and

P)
,,
t:Tg ril'
lrrl plly1;r', LlSi ( onttnerciill [Link], Ilaker
I
F-8 Jn., P. B. No. 227, Kottavam - (186 001
t2581999
I Tcl: 01t3 I 2301999, lMob: 9:149870062 iErnait: ko ttal'2-1111,,11'r-c. co. in I

IioLtavatr I ilaiilr,:[Link] ]Tri,,,arrcirurnl IIttr-unairo..rr ] Iiochi I I(arnnur I Calicrrr ] Chelnai I

ltlll): / / \\ rt r,r .r re .cu. in

 Vishnu Kajendnan & Co I
g#.q1
ffi g.\il
\.

Chartered Accountants i
i
€d\F-l
& #.
M,,. B
\B.
1

iii. [Link] rca)^orllrbl(] asstlrallcc'r'ega|ciing prevention or timely detection of unauthorized acquisition, use, or
disposltiort .)i tllL'Cotnp:lny's assels that coLrld have a t-nalerial clfect on the financial staterlents.

Inherent Limitation trf I,lernal financial controls over financial reporting

IJecaLtse ol ther itrltet'eLrt linritltron of internal financial controls over financial reporting, including tlre possibility of collusion
or itltpt'oper [Link](llll oVert'icle of contt'o1s, rttateIial lnisstatenrents due to lraud or etror rn:ly occur anc[ not be detected.

risk tliat the interrral lirraricittl control over firtancial reporting uray becorne [Link] because of the changes i1 colditions, or
that the degree of coniplilincc with policies or ltroceclures may cleteriorate.

For Vishnu Rajendran & Co,

L-ha rtcrecl Accoun ta r't ts
FItN: 00,1.741S

Abraham, FCA
Place: l{ochi
Date: f uly 20,2020 Mernbershi6 No: 208529
LIDIN: 2 02 0B 529 AAAAAB9952

ffi Qc][[16prg

F-9
3*1Floor, CSI Commercial Centre, Baker Jn., P. B. No.227, Kottayam 686 001
lTei: 048 i 2301999, 2581999 | Mob: 9349870062 | trmai1: kottayam,,r [Link]. in I

lic.r[ta-valr li.J:irrgr,lorc l1'rivar-rdrr-rm Er[urnanoor lliochi jI(annur lCalicut lChennai I

lt t p:/ ri rvrr. [Link]. in

L
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 Vishnu Rajendran & Co
Chaftered Accountanfs

The Board of Directors

Muthoottu Mini Financiers Limited
Muthoottu Buildings,
Kozhencherry
Pathanamthitta - 689 64L,
Keral4 India

Dear Sirs,

We have examined the attached reformatted standalone financial information of Muthoottu Mini
Financiers Limited, (the "company'J annexed to this report, which is proposed to be included in the
Draft Prospectus / Prospectus of the Company in connection with the proposed issue of Secured
Redeemable Non-Convertible Debentures (NCDsJ up to I 10,000 lacs, with an option to retain over-
subscription up to t 10,000 lacs, aggregating up to t20,000 lacs ("Issue"), for issuance bf additional
NCDs in terms of the requirement of Section 26 of the Companies Act, 2013 read with rules thereto
("the Acd'J, Securities and Exchange Board of India (lssue and Listing of Debt SecuritiesJ Regulations,
2008, as amended ("the Regulations") issued by Securities and Exchange Board of India [SEBI), as
amdnded from time to time in pursuance of Section 11A of the Securities and Exchange Board of India
Act,1992 (the "SEBI Act"J and related clarifications and in terms of our engagement letter dated 20th
Jrly,2020. This financial information has been prepared by the company and is approved by the
debenture committee of the board of directors ofthe Company.

The preparation and presentation ofthe reformatted financial information is the responsibility ofthe
Company's management. This reformatted financial information is proposed to be included in the Draft
Prospectus /Prospectus of the Company in connection with the Issue. These reformatted financial
information have been regrouped and reclassified in accordance to Schedule III of Companies Act, 2013
for the years ended March 31"t 20L9,2018,2017 and20l6.

We have examined this financial information taking into consideration the Guidance Note on Reports in
Company Prospectus (Revis ed 2079) issued by the Institute of Chartered Accountants of India.

1. Reformatted Standalone Financial Statements as per Audited Standalone Financial

Statements of the Company

We have examined the following attached statements of the Company:

a) the "Reformatted Standalone Statement of Assets and Liabilities" as at March 31't 201g,201,8,
2017 and20t6[Annexure I) and the schedules forming part thereof [Annexure IVJ;

b) the "Reformatted Standalone Statement of Profits and [Link]" for each of the years ended March
31'r 2079, 2018,201.7 and 2016[Annexure IIJ and the schedules forming part thereof fAnn-exure
V); and

cJ the "Reformattednstandalone Statemenf of Cash Flows" for each of the years ended M

3.d Floor, CSI Commercial Centre, Baker

Jn., P. B. No. 227, Kottayam - 686 001
F-95
lTel: 0481 2301999, 258L999 | Mob: 9349870062 I Email: kottayam@[Link] I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: l/[Link]
 Vishnu Rajendran & Co
Chartered Accountqnts
,c&l
2019,2ol$,2o1'7 and,2016 (Annexure IIIJ, together referred to as "Reformatted Standalone
Financial Statements".

The financial statements for the years ended as at March 31"t 2o1g,2o7g,2or7 and 2016 have
been
adopted by the Board of Directors and approved by the members ofthe Company.

The audited financial statements for the year ended March 31"t, 2020 ("Audited Financial Statements,,)
have been approved by the Board of Directors on July 20, 2020 is not included in the reformatted
standalone financial statement but annexed separately. The Audited Financial Statements have been
prepared in accordance with principles laid down in the Indian Accounting Standards (,,lnd
AS,,J and is
accordingly not comparable with the previous audited financial statements for the year ended
March 31
z0t9' 20L8' 2077 and 2016, respectively, prepared in accordance with generally accepted accounting
principles in India, which form the basis ofthe Reformatted Standalone Financial Statement.

We have performed such tests and procedureg which in our opinion were necessary for the purpose
of
our examination. These procedures, mainly involved comparison ofthe attached Reformatted Financial
Information with the Company's audited financial statements for financial years ended March 31"t
2019,2078' 2017 and 2076 and regrouping and reclassification as per schedule III of Companies Act
2013 and requirements of'SEBI Regulations'.

These Reformatted Standalone Financial Statements have been extracted from the Audited Standalone
Financial Statements ofthe Company after making such adiustments, reclassifications and regroupings
a's consideredappropriate and based on our examination of these Reformatted Standalone Financial
Statements, we state that:

[aJ These Reformatted Standalone Financial Statements have been presented in ,,Rupees in lakhs,,
solely for the convenience ofreaders;
(bJ These Reformatted Standalone Financial Statements have to be read in conjunction
with the
relevant Significant Accounting Policies and Notes to Financial Statements on the Reformatted
Standalone Financial Statements given as per Annexure XII;
[c) The figures of earlier years have been regrouped fbut not restated] wherever necessary, to conform
to the classification adopted for the Reformatted standalone Financial statements;
(d) There are no extra-ordinary items that need to be disclosed separately in the Reformatted
Standalone Financial Statements;
(eJ There are no qualifications in the auditors reports that require adjustments to
the figures in the
Reformatted Standalone Financial Information that has been prepared in accordance
with the
, Companies (Prospectus and Allotment of Securities] Rules, 2014 corresponding to Sec. 26(11 ofthe
Companies Acg 2013; and
(0 These Reformafted standalone Financial Statements conform to the requirements ofschedule lli of
Companies Ac! 2013 and the Revised Schedule VI ofthe Companies Act,:.956.

2. other standalone Financial Information of the company

t

3'd Floor, CSI Commercial Centre, Baker Jn., p. B. No. 227, Kottayam - 686 001
F-96
lTel: 0481 23OL999,2581999 lMob: 9349870062 Email: kottayam@[Link]
I I

|Kottayam|Banga1ore|Trivandrum|Ettumanoor|ro"n
http: //[Link]
 Vishnu Rajendran & Co
Chqrtered Accountqnts

We have examined the following Other Standalone Financial Information of the Company for each year
ended March 31st 201.9,2078,2017 and 20\6 proposed to be included in the Draft Prospectus /
Prospectus and annexed to this report:

a) Statement of Secured & Unsecured Loans [Annexure VI)

b) Statement of Accounting Ratios fAnnexure VII)
c) Statement of Dividends fAnnexure VIII)
dl Statement of Contingent Liability [A4nexure IX)
e) Statement of Tax Shelter (Annexure XJ
0 Statement of List of Related Parties & transaction with them [Annexure XI A & B)
g) Significant Accounting Policies & notes to the Financial Statements [Annexure XII)

3. Based on our examination of these Reformatted Standalone Financial Information, we state that in
our opinion, the "Reformatted Standalone Financial Statements as per Audited Standalone Financial
Statements of the Company" and "Other Standalone Financial Information of the Company"
mentioned above for the years ended March 37't20L9,2018,20L7 and201,6 have been prepared in
accordance with Section 26 of the Act, rules prescribed under the Act and the Regulations amended
'by
time to time, by SEBI Act.
4. This report should not in any way be construed as a re-issuance or re-dating of any of the previous
audit reports nor should this be construed as a new opinion on any of the financial statements
referred to herein.

This report is intended solely for your information and for inclusion in the Draft Prospectus /
Prospectus in connection with the Proposed public issue of NCD aggregating to t10,000 Lakhs with an
option to retain over-subscription up to t10,000 Lakhs for issuance of additional NCDs and is not to be
used, referred to or distributed for any other purpose without our prior written consent.

For Vishnu Raiendran & Co.

Chartered Accountants
Firm Registration No: 00474L5
Peer Review No:.077622
UDIN : 2020Lt01tuLL\DFg

Partner
Membership No: 20770L

Place :Kottayam
Date : August 74,2020
..

Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
2581999 F-97
lTel: 0481 2301999, | Mob: 9349870062 I Email: kottayam@[Link] I

lKottayam lBangalore lTrivandrum, lEttumanoor lKochi lKannur lCalicut lChennai I

http: I I [Link]
Vishnu Rajendran & Co
Chartered Accountants

Annexure - I: Reformatted Summary Statement of Assets and Liabilities

P rileuX rS iN;5s #S:lfit

jXINUSi,x

$$il $[Link]:iilfi$il-0: i 2i0i 9.:Xr:iili:l:$*#Oi$ 2 0:ilfftiXiii :il :s${i?lqfi

'fi
EOUITY AND LIABILITIES

Shareholders' funds
al Share capital 24,952.54 24,952.54 22,500.00 22,5.00.00
bJ Reserves and surplus 19,77 4.98 L7,679.52 L4,660.7B 22,7 69.27

[c) Money Received against

Share Warrants
Share application money
ndine allotment
Non-current liabilities
al Long-term borrowi 46,807.06 56,809.60 84,039.82 7,LL,202.31
Deferred tax liabilities fnet
cl Other long-term liabilities 17,906.00 L8,L7',1.68 L8.991.79
dl Lone-term provisions t33.92 145.47 108.20 4Le54
Current liabilities
al Short-term borrowi 35,510.20 37.795.L9 38,330.00 t8,622.55
bl Other current liabilities 36,834.52 4L,400.44 5L,072.87 64,929.30
cl Short-term provisions L,682.58 7,395.94 L,434.89 7,407.08

TOTAT 1,93,595.80 1,98,3 50.38 2,3L,L38.29 2,4L,849.05

4SSE]S
Non-current assets
al Fixed assets
Taneible assets 79,428.79 20,L71,.24 21,987.47 37,373.48
Intaneible assets
Intangible assets under
development
Capital work-in-progress
bJ Non-current investments
cJ Deferred Tax Asset 908.77
'J,,969.07
(d) Long-term loans and L,983.64 3,868.34 3,402.69
advances
el Other Non-Current Assets
Current assets
aJ Current Investments
Cash and cash equivalents L0,2L2.30 7.784.98 L2,B0B.B5
tg) Short-term loans and L,38,472.95 L,63,078.52 L,95,940.49 L,9L,3L9.41
advances
dl Other current assets o 74,453.24 2.L39.89

TOTAT 1,83,595.80 1,98,350.38 2 2,+7,,&+9.0

The accompanying statement of significant accounting policies and notes to accounts on financial'
statements attached shall form an integral part of this statement

3.d Floor, CSI Commercial Centre, Baker Jn., P. B. No. 227, Kottayam - 686 001
F-98
| Mob: 9349870062 | Email: kottayam@[Link]
lTel: 0481 2301999, 258L999 I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: I [Link]
 Vishnu Rajendran & Co
Chartered Accountants

Annexure - II : Reformatted Summary Statement of Profit and Loss

For the year ended

Particulars Note 3L/03/zote 3Uo3/20L8 3L/o3/Tot7 sLlot/zoL|
No.

Revenue from operations P. 29,612.44 33,260.16 43,391.40 39,105.35

Other income a 203.04 233.23 155.02 9.04
Total Revenue 29,9!5.48 33,493.39 43,546.42 39,114.39
ExDenses
Employee benefits expense R 5,837.99 6,208.98 6,446.80 5,805.46
Finance costs L6,461.05 L9,493.31 24.490.25 21,51,5.7 7
Depreciation and amortization
7,343.45 1,,7 53.g',J. 2,202.34
Expense
Operatins & other ex 4,055.96 3,965.05 5,[Link] 6,068.56
Total Expenses 27,236.90 3L,OLO.79 37,909.95 35,592.L3
Profit / (Loss) before
exceptional and extraordinary 2,578.58 2,492.60 5,636.57 3,522.26
items and tax
Exceptional &Extraordinary
items
Profit (Loss) before 2,579.58 2,482,60
extraordinarv items and tax 5,636.57 3,522.26
Prior Period Items 73,783.5 1,609.00
Profit / floss) before tax 2,579.58 2,482.60 I,146. L,9L3.26
Tax exnense:
Current Tax expense 664.35 990.4\ 12.50 1.,584.52
Deferred Tax
pfq4! 1 @oss) for the year 2,095.60 L,q24.59 [8,108.51) 977.96

l'trsffiii6l
3'd Floor, CSI Commercial Centre, BakerJn., P.B. No.227, Kottayam - 686 001
lTel: 0481 2301999, 258L999 | Mob: 9349870062
F-99 | Email: kottayam@[Link] I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: //[Link]
 Vishnu Rajendran & Co
Chartered Accounta;nts

Annexure - III: Reformatted Summary of Cash FIow Statement

(I in Lacs)
Particulars For the year ended
3r/03/2OLe 3UO3/20L8 3UO3/2OL7 3L/O3/20L6
A. Cash FIow from Operating
Activities
Operatine Profit/flossJ for the year 2,57B.5B 2,482.60 (8,L46.98) 1,9'J.3.26
Adiustment for :
Provision for Standard Assets (s4.82) [11.s8) 97.63 81.90
Provision for NPA 291,.30 (27.38) 3.7 0 767.7 4
Provision for Asset Under Securitisation 50.77
Provision for GratuiW I net) [[Link]] 37.26 [310.34) 152.98
Provision for Diminution in value of
294.09 73.52
investment/ Investment w /off
fProfit)/Loss on sale of assets [6.s6] [7s.18) (40.07) 0.89
Finance Cost L6,46L.05 79,493.31 24,490.25 2L,515.77
Depreciation 835.73 1,,1,96.L3 t,495.82 1,956.08
Prior Period Items L5,45L.29 1.609.00
Business
Income from Non Operating [0.20) [0.1e) (0.23) t0.28)
Operating Profit/(Loss) before 20,143.70 23,094.97 33,335.16 27,470.96
working capital Adiustments
Adjustments for:
Short Term Loans & Advances 24,605.57 32,86'1,.96 (4,62L.07) (73,725.94)
Current Investments 39.56
Other Current Assets 313.35 273.01 120.24
Long Term Loans & Advances
Short-term borrowings - (2,284.99) (s34.811 79,7 07 .45 (7 ,912.71)
Current Liabilities (4,565.92) (9,672.37) (7,9LL.99) L8,6L7,22
Cash generated from operations 25,585.01 45,951.25 40,762.12 24,329.79
Income taxes paid, (664.35) (990.411 (1,190.23) tL,451.82)
Net Cashtrom ODJeratinq Activiw 24,920,66 AA,960,A4 39,571.89 22,877,97
B. Cash Flow ftom Investing
4itv:l=:
Income from Non Operating Business 0.20 0.19 0.23 0.28
in Investments
Increase / (D ecrease)
Increase/[Decrease) in Long Term
1,4.62 21,8.73 722.81, 85.53
Loans and Advances
Sale of fixed Assets 33.42 954.L2 9.1.4082 44.26
Purchase offixedAssets (1,02.97) (20e.64) (422.33) [20,358.09')
Net Cash FIow from Investment (54.73) 963.40 9,44L.53 (20,228.02)
Activity
C. Cash Flow from Financing Activities
Increase/[Decrease) in Long Term
(L0,008.54) [28,050.32) [14,083.83)
Borrowi
Increase/(Decrease) in Other Long-term
(26s.68)
Liabilities t
Finance Cost (76,461,.05) (1,9,493.3L) (39,953.46) (2L,5L .77)

Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
F-100
lTel: 0481 2301999, 258L999 | Mob: 9349870062 I Email: kottayam@[Link] I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: / /[Link]
Vishnu Rajendran & Co
Chartered Accounta;nts

lncrease/[Decrease) in Capital incl. 4,046.69

'ce
\,/

Securities Premium
Net Cash Flow from Financi 26,735.2 +3,496.94 54,037.29 6,07L.64
D. Net Increase/[Decrease) in cash & (1,869.35) 2,427.32 (5,023.87) 9,727.59
Cash Eouivalents
E. Opening Balance of Cash L0,272.30 7,784.98 12,808.85 4,087.26
uivalents
F. Closing Balance of Cash Cash
8,3+2,95 L0,212.30 7,784.98 12,808.85
uivalents
Components of cash and cash
uivalents
Current Account with Banks 4.275.57 6,586.09 2,447.40 3,527.75
Deposits with Banks 2,87 0.35 2.227.92 3,897.27 7,433.55
Cash in Hand 7,257.03 L,398.29 7,440.3L L,847.55
8,342.95 LO.2L2.30 7,784.98 12,908.85

BakerJn., P.B. No.227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre,
F-101
lTel: 0481 2301999, 258L999 | Mob: 9349870062 | Email: kottayam@[Link] I

;fott.y.*lBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: l/[Link]
Vishnu Rajendran & Co
Chqrtered Accountants C6\
Annexure - IV: Notes to Reformatted Summary Statement of Assets and Liabilities

Note A: Share Capital I in Lacs

As at
[Link] 019 31 20LB 3t oL7 3110312016
Share Canital
Agtlqlzctfcaptal
Eouiw shares of i 100 each
Issued. Subscribed and Paid- UP
I3I:r4
[Link]

b. The reconciliation of the number of shares outstanding and the amount of share capital as at
March 31 of the respective Years
at
Particulars 3L/03lzvLe 3L/03/2015 3L/03/2OL7 3Ll03/20L6
Shares outstanding at the beginning of 2,49,52,539 2,25,00,000 2,25,00,000 2,25,00,000
the year
Shares Issued during the Year 24,52,539
Shares outstanding at the end of the 2,49,52,539 2,49,52,539 2,25,00,000 2,25,00,000

Name of Shareholder No. of Shares Held as at

03l2ol9 3L/03/20L8 3L/03/20L7 3L/03/2016
Mr, Roy Mathew L.66.06,347
Mr. Mathew Muthoottu 47,79,972 7,47,79,9\2 L,36,78,094 L3,88,094
Mrs. Nizzv Mathew 33,54,446 33,54,446 33,54,446
M/s. Mini Muthoottu Hotels [P) Ltd 25,5L,298 25.51..298 24,L2,698 24,L2,698
M/[Link] Muthoottu Credit India 74,L9,847 L4,79,841 1.4,L9,847 l4,l9,B4L
Private Ltd

Name of Shareholder Percen Ho As At

03l20L9 31103/20t8 31 03 /20t7 31 03 t20L6
Mr. Rov Mathew 73.87o/o
Mr. Mathew Muthoottu 59.23o/o 59.23o/o 60.79o/o 6.L70/o
Mrs. Nizzv Mathew L3.44o/o 73.44o/o L4.91o/o
M/s. Mini Muthoottu Hotels [P) Ltd 70.22o/o L0.22o/o L0.72o/o L0.72o/o
M/s. Mini Muthoottu Credit India 5.690/o 5.690/o 6.3Lo/o 6.3Lo/o
Private Ltd

the Year
Particulars 2019 31 018 3Ll03 20L7 31

3'd Floor, CSI Commercial Centre, BakerJn., P. B. No.227, Kottayam - 686 001
F-102
0481 2301999, 258L999 Mob: 9349870062 Email: kottayam@[Link]
lTel: | | I

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 Vishnu Rajendran & Co
Chartered Accountants

Fully paid up pursuant to contract(s)

without payment being received in
cash
Fullv Paid uP bY wa ofbonus shares
Shares bought back

E. ---E---- ts attached
- to each class of equity shares
-'
TheCompanyhavingaparvalueofT100/-[Link] the Company,
holder of equity shares is entitled to oneyote per share. In the event of liquidation of
the holders of equity shares will be entitled to receive remaining assets of the Company, after
distribution of ali pieferential amounts. The distribution will be in proportion to the number
of
eouitv shares held by the shareholders

Note B: Reserves and

Particulars 31 03 20t9 31 03 018 31 03 20t7 31 03 016

I Reserve Fund
3,652.54 3,367.63 67.63 3.L72.03
ening Balance
4L9.09 284.92 195.59
Current Year Transfer
-l Written Back in Current
4,07 L.63 3,652.55 3,367.63 3,367.62
Closing Balance

Securities Premium
7,844.L5 6,250.00 6.250.00 6,250.00
Ooenins Balance
(+) Securities premium credited on 7,594.15
Share issue
-l Written Back in Current Year
Closine Balance 7,844.75 7.844.75

Revaluation Reserve
350.00 350.00 350.00 350.00
Opening Balance
+l Current Year Transfer
-lReduced in Current
Closine Balance 350.00 350.00 350.00

Debenture RedemPtion Reserve

13,L72.72 L2,807.65 LZ;80\.65 12,0L9.28
Opening Balance
4,608.64 371,.07 782.37
+J Current Year Transfer
-lReduced in Current
8,564.08 L3.172.72 01.65 12.801..65
Closine Balance

Su lus in Profit and*Loss A/c

On nine Balance 7,339.90 8.108.51

3.d Floor, CSI Commercial Centre, Baker Jn', P' B' No. 4,27, Kottayam - 686 001
F-103 Email: kottayam@[Link]
lTel: 0481 2301999, 2581999 | Mob: 9349870062 I I

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Vishnu Rajendran & Co
CharAered Accounto;nts

[+) Net Profit /(Loss) for the Current 2,095.47 L,424.59 [8,108.51) 977.96
Year
(-l Transfer to SDecial Reserve Fund t419.091 (284.92) - (195.59)
[-) Transfer to Debenture Redemption 4,608.64 (37 L.07) (782.37)
Reserve
Closi Balance 1,054.88 7,339.90 8,108.51

Total Reserves & Su lus L9,774.98 L7 79.52 L4,660.78 22,7 69.27

Note 1: Statutory Reserve represents the Reserve Fund created u/s 45lC of the Reserve Bank of India
Act,7934. An amount representing 200lo of the Net Profit is transferred to the Fund for the years.
Note 2: Pursuantto Section 7L of the Companies Act,2013 and Rule 7B(7) of the Companies (Share
Capital and Debentures) Rules, 201,4, the Company is required to transfer 25o/o of the value of the
debentures issued through public issue as per the present SEBI flssue and Listing of Debt Securities)
Regulation, 2008 to Debenture Redemption Reserve (DRR) and no DRR is required in case of privately
placed debenture. Also the Company is required before 30th day of April of each year to deposit or
invest, as the case may be, a sum which shall not be less than 15o/o of the amount of its debenture
issued throueh public issue maturing within one year from the balance sheet date.
The company has complied with the provisions of DRR as on 31"t March,2019

Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
F-104
lTel: 0481 2301999, 258L999 | Mob: 9349870062 | Email: kottayam@[Link] I

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 Vishnu Rajendran & Co
Chartered Accounto;nts c&l
\-t

Note C: Long Term Bo

Particulars 3Ll03l20Le 3L/03/zoL 3U03/201 3L/03/2o1

87 6
I. Secured
[a) Listed Secured Redeemable NCD
5,585.97 10,900.08 29,334.64 57,846.7L
Public Issue frefer note C-1 below
[b) Secured Redeemable Privately place{ 1,906.25 L,7L2.44 I,878.96 78,4L0,75
NCDfrefer note C-2 below
c). Term Loan from Banks
-{il-sou-flr
Indian gank Ltd. - - +[Link] t,too'ss
[secured by Hypothecation of Fixed
Assets purchased /Security Deposits of
[Link] be repaid in 10 equal half
instalments with interest @L3o/o
(ii) HDFC Bank Limited Car Loan fBenz 18.1L
c350
I Secured by Hypothecation on vehicle
and'is to be repaid in 60 equal monthly
installments with interest @ 9.95o/op.a

(iii) HDFC Bank Limited Car Loan L.62 LO.7B

(Secured by Hypothecation on vehicle

and is to be repaid in 60 equal monthly
installments with interest @ 9.95o/op.a

(iv) HDFC Bank Limited Car Loan 9.60 36.44

(secured by Hypothecation on vehicle

and is to be repaid in 60 equal monthly
installments with interest @ L0.75o/o
(v) HDFC Bank Limited Car Loan 0.86 4.09

(secured by Hypothecation on vehicle

and is to be repaid in 60 equal monthly
installments with interest @ 10.500/o
(vi) South Indian Bank, 29.00
Pathanamthitta Car Loan
(secured by Hypothecation on vehicle
and is to be repaid in 60 equal monthly
installments with interest @ 10.50o/o
(vii) HDFC Bank Limited Car Loan 22.68 3B;9O,-
BMW X-5
'on vehicle
(secured by HyPothecation
and is to be repaid in,60 equal monthly
installments with interest @ L0o/o
viii) HDFC Bank Limited Car

3'd Floor, CSI Commercial Centre, Baker Jn., P. B. No. 227, Kottayam - 686 001
lTel: 0481 23Ot999, 258L999 | Mob: 9349870062
F-105 I Email: kottayarl;r@vrc. co. in I

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http: //[Link]
Vishnu Rajendran & Co
Chqrtered Accountants

Ietta
(secured by the hypothecation of the
vehicle to be repaid in 60 equal
installments with interest @ LUo/o
[ix) SBI - Vehicle Loan
(secured by hypothecation of vehicle to 7 0.23
be repaid in 84 equal monthlY
installments with interest @L0.40o/o
II. Unsecured
[a) Listed Unsecured Debentures - Public 18,393.27 23,356.26 23,356.26 23,356.26
Issuefrefer note C-3 below
(b) Unsecured Privately Placed
Debentures[redemption year 2020 -2022 448.50 373.7 5 540.45 390.45
rate of interest 7L.25o/o - 24.77o/o)
(c)Subordinate Debt (redemption year
2021 - 2024 rate of interest L0.75o/o - 20,467.07 20,467.07 20,467.07 9,878.04
16.67o/o)

[III) Loan from Directors

(IV)'Loan from Companies Under Same
manaqement
Total Long Term Borrowings 46,80L.06 56,809.60 84,o3g,82 1'11'202'3

Note C-1: Listed Secured Redeemable NCD - Public Issues

(ilin Lacsl
As At
Particular Date of 3L/03/zoL 3L/03/zol 3L/03lz0t 3L/03/zOL Redemption
s Allotment 987 6 Period
(Interest

(a) Listed 28/03 /20L 3,106.56 3,106.56 3,106.56 400 days to 66

Secured 4 (lnterest months
Redeemabl rate TZo/oto
eNCD- 73.5o/o)
Public
Issue I
[b) Listed 0B-08-2014 8,577.77 500 days to 66
Secured (lnterest months
Redeemabl rate LZo/oto
eNCD- \3.250/o)
Public
Issue II
(cJ Listed 1.1-L7-20L4 2,772.64 6,075.88 LB months to 66
Secured (lnterest months
Redeemabl Rate
eNCD- [Link]/oto
Public
Issue III
L3.43o/o)"s
H--"
3'd Floor, CSI Commercial Centre, Baker Jn., P. B. No. 227, Kottayam - 686 001
F-106
0481 23OL999, 2581999 Mob: 9349870062 | Email: kottayam@[Link] I
lTel: |

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Vishnu Rajendran & Co
Chqrtered Accounta;nts
6,866.87 6,866.81 L7 months to 43
(d) Listed 07 /04/201.
months
Secured 5
Redeemabl flnterest
eNCD- rate \1-.5o/o
Public to L3.7o/o)
Issue IV
5,585.97 7,780.83 L3,279.69 L3,2\9.69 17 months to 73
[e) Listed 25-08-20L5
months
Secured Interest
Redeemabl rate 7'1.57o/o
eNCD- to L2.25o/o)
Public
lssue V
27 -0L-201.6 6L2.69 3,968.94 20,000.00 l-7 months to 51
(f) Listed
months
Secured Interest
Redeemabl rate L0.25o/o
eNCD- to tL.Z\o/o)
Public
nr1
i sue are secured bv w-a1 of
111
road,
pur* .r,[Link]'on immovable property located at House of Hiranandhini,No.5/63,Old Mahabalipuram
including Book Debts,
;;;,hr; Viilrg;, Chennai - AbOTSO ina first pari passu charge on Current-Assetsranking pari-passu with
i8"n, A eaur]r."s, Cash & Bank Balances and Receivables, both present and future
the existing secured lenders.

3.d Floor, CSI Commercial Centre, Baker Jn', P' B' No. 227, Kottayam - 686 001
F-107 Email: kottayam@[Link]
lTel: 0481 2301999, 258L999 | Mob: 9349870062 I I

Kochi Kannur I Calicut I Chennai

I [Link]"y""il B"ngalore I Trivandrum I Ettumanoor I I

http: //[Link]
Vishnu Rajendran & Co
Chartered Accountqnts \__, C(q
-..____.__._../

Note C-2: Secured Redeemable Privately placed NCD

ilin Lacs
NCD Date of Allotment {lloslzotg 3lloslaol.s 3tlo3/20L7 3Llo3l20LG Redemption
Series Interest Rate Period
XVIII 75 /03 /2013 - till 1 year to 6
date 7,906.25 1,592.93 4,786.85 4,803.00
years
LZo/oto 18.18%
xul 0t/71/20L2 - L year to 6
1.4 /03 /2073 39.96 3,532.21, 3,7 06.07
years
\2.5o/o to 18.18%
XVI 2e /0e /2012 - L year to 6
3t /70 /20L2 24.98 540.45 579.7 8
years
12.5o/oto 1B.1,Bo/o
23/05/2012 - L year to 6
28/0e /2012 18.03 528.89 3,437.49
years
L2.5o/oto LB.L9o/o
XN 27 /0L/2012 - 1 year to 6
20.22 195.58 4L0.56
31./03 /20L2 iears
72.5o/o to 18.78o/o
26/03/20L2 - 1 year to 6
22 /os /2012 74.32 239.56 L,535.42
years
!2.5o/oto 1,B.1Bo/o
XII 1,0 /01./20L2 - L year to 6
25 /03 /2012 L,563.46
years
120/o to 18.18%
0e /L2/2011 - 1 year to 6
838.31
0e l0L/20L2 years
L7.5o/oto [Link]/o
76/1r/2011 - L year to 6
0B/L2/2071 2.00 L8.24 503.42
years
L1,.5o/oto [Link]/o
22/08/2011 - L year to 6
\s /7L/20L1 8.80 1,010.86
years
L1,.5o/oto L3.75o/o
VII 02/06/2011 - 1, year to 6
27 24.88 24.88
/06 /201,7 years
1,L.5o/oto 13.75o/o
04 /17/2010 -
year to 6
06 /03 /201,7 3.50 3.50 1-

years
(71..57o/o to
L2.250/o

woter Security:The above Secured Redeemable Privately placed NCD are secured on pari passu charge on
current assets including book debts, loans and advances, cash and bank balances and receivab[gs both
resent and future of the company with secured lender

Note C-3: Listed Unsepured Debentures - Public Issue

Commercial Centre, Baker Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI
F-108
lTel: 0481 2301999, 2581999 | Mob: 9349870062 I Email: kottayam@[Link] I
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Vishnu Rajendran & Co
Chqrtered Accounta;nts

Particulars Date of Allotment 3l-Mar- 3l-Mar- 3l-Mar- 3l-Mar- Redemption

Interest Rate 20t9 20L8 201720L6 Period
[a) Listed 08-08-20L4 (L3.29o/o' 4,962.99 4,962.99 4,962.99 66 months
Unsecured L3.43o/o)
Debentures -
Public Issue II
[b) Listed t7-'l.L-2074 (72.7 5o/o - 7,L43.37 7 ,743.37 7,143.37 7,143.37 66 months
Unsecured L3.43o/o)
Debentures -
Public Issue III
(c) Listed 07 -04-201.5 (L2.6Bo/o - 6,849.15 6,849.L5 6,849.L5 6,849.15 66 months
Unsecured [Link]/o)
Debentures -
Public Issue IV
(d) Listed 27 -07-2016 (11.02o/o - 4,400.75 4,400.75 4,400.75 4,400.75 78 months
Unsecured Ll.25o/o)
Debentures -
Public Issue VI

Particulars 31 03 /20L9 3L 03120L8 31 03 /20L7 3L 03 oL6

Interest accrued but not Due on L7,906.00 1,8,1,7 7.68 L8,99L.79
debenture & sub debt
Total Lons Term Provisions L7,906.00 LB,L7L.6B L8,99L.79

As At
Particulars 31 03 2019 3L 03 018 31 03 0L7 31 03l20L6
L33.92 L45.47 10B.20 4L8.54
Provision for Gratui
Total Long Term Provisions 108.20 4L8.54

Rate of As At
Particulars
Interest as 3L/03l}OL 3LlO3 /?OL 3L/03 /ZOL 3L/03|ZOL
on March 31, 9876
20L9
Secured Loan RePaYable
on Demand
(a) South Indian Bank L0.00o/o 16,533.31 L5,47 8.7 0 L2,384.87 2,144.25
Secured by way of first
paripassu charge along
with existing secdred
lenders of the company on

BakerJn., P.B. No.227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre,
F-109
lTel: 0481 2\Olggg, 258L999 | Mob: 9349870062 | Email: kottayam@[Link] I

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Vishnu Rajendran & Co
Chartered Accountants C&
-- .
-.-.-..-..........---..--'
/

all receivables under gold

loan both present and
future of the company
with 1,5o/o margin.
Additional collateral
security by way of
immovable property
owned by the company
and group companies' viz.
Muthoot Mini Theaters
Pvt Ltd, Mini Muthoottu
credit India Pvt Ltd,
Muthoottu Mini Hotels
Pvt. Ltd, Kandamath Cine
Enterprises (P) Ltd,
Personal Guarantee of
Directors viz. Mr. Mathew
Muthoottu, Mr. RoY M
Mathew and Mrs. NizzY
Mathew
(b) Federal Bank L2.750/o 3,638.19 3,265.98
Limited
Secured by way of Gold
loan, Receivable of sPecific
branches allocated to
bank exclusivelY to the
bank with 1'5o/o margin.
Additional collateral
security of equitable
mortgage of 34.39 acres of
land, personal guarantee
of directors viz. Mr.
Mathew Muthoottu, Mr.
Roy M Mathew and Mrs.
Nizzy Mathew and
Corporate Guarantee of
Muthoottu Mini Theatres
Pvt. Limited
(c) State Bank of India L2.25o/o 4,503.62 3,484.7 5 3,531,.43 2,623.98
(earlier State Bank of
Travancore)
Secured by way of First
Charge on current assets
of the company on Pari
pasu basis with other
lenders in MBA and NCD
holders with Z5o/o margin.
Additional collateral
n
security by way of
immovable

3'd Floor, CSI Commercial Centre, Baker Jn., P. B. No. 227, Kottayam - 686 001
0481 23OL999,2581999 F-110
9349870062 I Email: kottayarn@vrc.
co. in
lTel: lMob: I

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Vishnu Rajendran & Co
Chartered Accounta;nts

owned by the M/s

Muthoottu Mini Theatres
tP) Limited and Personal
guarantee of directors viz.
Mr. Roy. M. Mathew, Mr.
Mathew Muthoottu, Mrs.
Nizzy Mathew and
Corporate Guarantee of
Muthoottu Mini Theatres
Pvt. Limited.
(d) Dhanalakshmi Bank 7L.50o/o 1,2L3.46 L,566.47 2,008.02 7,207.06
Secured by way of
Paripassu first charge bY
way of hypothecation of
current assets, loans and
advances and book debts
including Gold Loan
receivables with a margin
of 250/[Link]
collateral securitY bY waY
of immovable ProPertY
owned by theM/s
Muthoottu Mini Theatres
(P) Limited and Personal
guarantee of directors viz.
Mr. Roy. M. Mathew, Mr.
Mathew Muthoottu, Mrs.
Nizzy Mathew and
Corporate Guarantee of
Muthoottu Mini Theatres
Pvt. Limited.
(e ) State Bank Of India L2.00o/o 4,929.45
Secured by way of Gold
Ioan, Receivable of sPecific
branches allocated to
bank exclusivelY to the
bank with LSo/o
(f ) Andhra Bank 11,.500/o 5,047 .7 0 7 ,457.17 4,945.20 2,002.55
Secured by way of Pari-
passu first charge bY way
of hypothecation of Gold
Loan Receivables of the
company Iexcluding
microfinance receivables)
for the loans disbursed bY
them to individuals
against pledge of gold
ornaments with miniryrum
asset cover of t33.!3o/o
with 75o/o margin.
tFadTtor-i6l

3d Floor, CSI Commercial Centre, Baker Jn', P. B. No. 227, Kottayarn - 686 001
F-111
23}lggg, 2581999 | Mob: 9349870062 | Email: kottayam@wc'co'in I
I Tel: 0481

@re|Trivandrum|Ettumanoor|Kochi|Kannur|Ca1icut|Chennai|
http:/ /[Link]
Vishnu Rajendran & Co
Chartered Accountants

Additional collateral
security by way of
immovable property
owned by the company
and Muthoottu Mini
Hotels Pvt Ltd. Personal
guarantee: NizzY Mathew
and Mathew Muthoottu
4,525.42 3,337 .54 4,987.49 2,449.28
[g ) Indus Ind Bank 10.900/o
Secured by way of first
Pari Pasu Charge on
receivables including gold
loan receivables with
banks under MBA and
NCD holders. Additional
collateral securitY bY waY
of immovable ProPertY
owned by the company.
2,500.25
th) Oriental Bank Of LL.25% 1,585.98 4,035.20
Commerce, Coimbatore
Secured by way of Pari
passu first charge bY way
of hypothecation of Gold
loan receivables of the
company with minimum
asset coverage of 1.33
times with a margin on
250/o. And additional
collateral securitY bY waY
of immovable ProPertY
owned by the Muthoot
Mini Theaters Pvt Ltd and
Managing Director Mr.
Mathew Muthoottu.
Personal guarantee: NizzY
Mathew and Mathew
Muthoottu
2,1,00.72 2,435.48 2,4L9.22
[i J Union Bank Of India LL.50o/o
Secured by way of
Paripassu charge over
present & future
receivables including
advances against securitY
of gold, gold jewellerY,
current assets, book debts,
loans advances &
receivables including gold
loan receivables and Eook
debts and receivables.
Personal suarantee of

3.d Floor, CSI Commercial Centre, BakerJn., P.B. No.227, Kottayam - 686 001
I Tel: O4g 1 23}lggg, 2;glggg I Mob: F-112
9349870062 | Email: kottayam@[Link] I

Calicut I Chennai
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Vishnu Raiendran & Co

Chqrtered Accountqnts c&l
Mathew Muthoottu, NizzY
Mathew, RoY M M4thgIL
1,927.34
(j) Reliance CaPital Ltd
Secured bY waY of Pari-
passu first charge bY way
of hypothecation of Book
Debts to the extent of
L00o/o of the exposure
created out of RCL
funding. Additional cash
collateral securitY to the
extent of 5o/o of the loan
amount to be maintained
lien marked in favour of
Reliance Capital Limited.
37,795.L9 38,330.00 L8,622.55
Total Short Term 3 5,510.2 0

3rd Floor, CSI Commercial Centre, BakerJn., P.B-No.227, Kottayam - 686 001
F-113 | Email: kottayarn@[Link]
lrel: o+g r 23olggg, 2sgtggg I Mob: 9849g10062 I

*4rroor l Kochi l Kannur l Calicut l Chennai I

http: l/[Link]
Vishnu Raiendran & Co
Chqrtered Accountants

Note G. Other Current Liabilities

Particulars 31 o3l20l9 31 03 /20L8 31 03 /20L7 31 03120L6

Current maturitY of Long 27,844.47 30,101.49 39,868.42 55,723.05
Term Borrowin
Interest accrued but not 8,015.81 L0,082.49 10,145.83 8,7 70.7 7

due on borrowin
Interest accrued on L69.97 259.99 272.49
unclaimed debentures
m payrbles 167.1Q 424.00 2q3.11 1e0.34
Oth"r 63?.18 532.4? 502.93 305'20
Total Other Current 36,834.52 4t,400.+4 sL,[Link] 64,929.30
Liabilities

Note G -1- Current Maturities of Long

Term Borrowin

Particulars

Current MaturitY of Secured NCD L,626.94 9,[Link] 1,0,049.7 5 L6,1,08.12

Privatelv placed frefer note G - 2 below
Current Maturity of Secured Listed NCD 5,31,4.17 L8,434.56 28,5L2.07 38,05L.77
- Public Issue frefer note G - 3 below
68.46 100.00 200.00
Unsecured privately placed NCD [rate of 1,080.00 7

interest 1.7.00o/o - 20.74o/o

Current Maturity of Un Secured Listed 4,962.99
NCD - Public Issue 2 [rate of interest
73.29o/o to '1,3.43o/o
Term Loan-SIB 479.07 68t.48 6BL.4B
Term Loan - SIB Securitisation 14,61,4.93
9.63 33.77 7 6.96 15A37
Vehicle loans
235.87 372.t9 448.76 531.31
Unclaimed matured Debentures
Term Loan- Dhanalakshmi Bank 208.33
fsecured by way of Pari-passu first
charge by way of hypothecation of Book
Debts to the extent of 700o/o of the
exposure created out of funding
repayable in 15 months interest rate @
77.50o/o
Total Current Maturity of Long Term 27,844.47 30,L0L.49 39,868.+2 55,723.05
Debt

3'd Floor, CSI Commercial Centre, Baker Jn., P' B' No' 227, Kottayam - 686 001
F-114
0481 23OL999, 2581999 Mob: 9349870062 | Email: kottayam@[Link]
lTel: | I

Calicut I Chennai
; t<ottuy.m I Bangalore I Trivandrum I Ettumanoor I Kochi Kannur I
I I

http: //[Link]
Vishnu Raiendran & Co
Chqrtered Accountants

Note G-2: Current Maturity of Secured NCD - Privately placed

in Lacs
NCD Date of {tlotlzoto 3Uo3/20L8 3t/03/2o1-7 3L/o3l2ol6 Redemption
Series Allotment Period
Interest Rate
xurr 75 /03 /2073 1,510,93 4,898.51 L,696.39 6,498.30 1 year to 6
years
till date
(LZo/o
LB.l9o/o
xul 01/L1./2012 36.46 3,488.7 5 65.04 7,328.78 1 year to 6
years
14 /03 /2073
(1.2.5o/o
18.L9o/o
2e /0e /2072 24.98 574.97 10.45 427.89 1 year to 6
years
3L/1.0 /20t2
(1.2.5o/o
LB,L9O/O
18.03 510.86 2,889.98 1,,177.96 L year to 6
23/0s /20L2
28/oe /2012 years
(12.5o/o
\B.79o/o
xv 27/01./2012 20,22 17 5.36 2L4.03 2,0L9.68 1 year to 6
37/03 /ZoLz years
(72.5o/o to
18.19o/o
26 /2072
/03 L4.32 223.24 L,299.37 1,653.9L L year to 6
22/0s /2012 years
(12.5o/o to
tB.\Bo/o
1.0/0L/2012 1,559.04 1.00 L year to 6
2s /03 /2072
years
(12o/o
[Link]/o
09 /1.2/20L1 838.06 0.05 L year to 6
years
0e /07 /2072
(71,.5o/o to
18.19o/o
1,6/1,1./20L1, 76.24 485.18 928.03 L year to 6
08
years
/L2 /201,1.
(1.L.5o/o to
[Link]/o
22/08/2077 [Link] 992.21 1,52.32 1 year to 6
\s /71/20L7 years
(1.1.5o/o to
L3.75o/o
vrrr 22/06/20L7 L,359.2'J, 1 year to 6
21,/08/2011 ,,

(1t.5o/o to
't ? 7 (0/^l
FdrGi-44
3d F1oor, CSI Commercial Centre, Baker Jn', P. B. No. 227, Kottayam - 686 001
. F-115
lTel: O48l 2301999,2581999 lMob:9349870062 lEmail: kottavam@vrc'co'in I

co. in
http : / / w .[Link].
-
lK"tt"y.r"lBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
 /''
Vishnu Rajendran & Co
Chqrtered Accounta;nts C6"q
\.,

UI 02 /2011 24.88 542.75 1 year to 6

/06
years
21/06/201L
(11.5o/o to
\3.750/o
07
L6.40 1 year to 6
/03 /201,1
years
07 /06 /201,1
(L1o/o to
'1,3.250/o

04 /11./20L0 3.50 t.B4 L year to 6

years
06 /03 /20LL
(L0o/o to
L3.25o/o
t.626.9+ 9,865.11 LO,O49.7S L6,L08.12
Note: SecuritY: Refer Note C 1

Note G-3: Current Maturity of Secured Listed NCD - Public Issue

Date of
*"$:IHX,"
particurars zLloslzoLs sL/oslzoLs 3t/03/zoL7 3L/03/20\6
tllfrt#lJ
Rate
3,106.56 3,557.94 400 days to
(a) Listed 28 /03 /20L4
(lnterest 56 months
Secured
Redeemable rate 12o/oto
NCD. 1,3.50/o)
Public Issue
I
0B-08-2014 8,577.77 500 days to
[b) Listed 66 months
[Link] Interest
Redeemable rate LZo/oto
NCD - 73.25o/o)
Public Issue
II
7L-LL-2074 2,172.64 3,903.24 L3,693.63 LB months to
(c) Listed
66 months
Secured Interest
Redeemable Rate L7.50o/o
NCD. to 73.43o/o)
Public Issue
III
6,866.81 LL,L92.77 t7 months to
[dJ Listed 07 /04/20Ls
43 months
Secured flnterest
Redeemable rate \[Link]/o
NCD - to 13.1o/o)
Public Issue
IV
(e) Listed 25-08-20L5 1,,594.86 6,038.86 9,607.43 L7 months to
(lnterest 73 months
Secured
Redeemable rate 1,L..17o/o
NCD. to 12.25o/o)
Public

3.d Floor, CSI Commercial Centre, Baker Jn., P. B. No.227, Kottayam - 686 001
2;gtggg F-116 Email: kottayam@[Link] I
lTel: O4g 1 23otggg, I Mob: 9349870062 |

ndrum|Ettumanoor|Kochi|Kannur|Ca1icut|Chennai|
http: I [Link]
Vishnu Rajendran & Co
Chartered Accountqnts
'i'ffi;
\-__-,,
IssueV
[f) Listed 27 -0L-201,6 6L2.69 3,356.25 16,031.06 - 77 months to
Secured 51, months
[[nterest
Redeemable rate 1,0.25o/o
NCD - to'1,1.25o/o)
Public Issue
VI
Total L8,434.56 28..512.O7 38,051.77
Note: Secu : Refer Note C 2

3'd Floor, CSI Commercial Centre, BakerJn., P.B. No.227, Kottayam - 686 001
F-117
Tel: 0481 23}Lggg, 258lggg Mob: 9349870062 Email: kottayam@[Link]
I I | I

; t<ott.y.m I Bangalore I Trivandrum.l Ettumanoor I Kochi I Kannur I Calicut I Chennai I

http: l/[Link]
Vishnu Raiendran & Co
.Chqr-t er e d A cc ountants lfi&
Note H:Short Term Provisions

Particulars 03 /20L9 31 20LB 31 20L7 3L 03l20L6

99.L7 826.55 822.85
Provision for Non-Performing L,090.47 7

Assets
608.34 5L0.71
Contingent Provision for 541,.94 596.77
Standard Assets
73.52
Provision for diminution in value
of investments
Provision for Asset Under 50.17
Securitisation
Total Short Term Provisions L,682.58 L,395.9+ L,434.89 L,407.08

Movement of Provision for Standard

and Non- Performing Assets in Short

As At
Particulars 2019 31 zoLB 31 oL7 31 03 /20L6

Provision for Standard Assets

608.34 51,0.71 [Link]
Provision at the beginning of the year 596.7 6
(s4.82) (11.s8) 97.63 81.90
Additional Provisions made during the

Provision at the close of the Year

Provision for Non- Perfo

826.55 822.85 655.10
Provision at the beginning of the year 7 99.17
29L.30 (27.38) 3.7 0 L67 .7 4
Add: Additional Provisions made during
the year
L,O90.47 826.55 822.85
Provision at the close of the Year

Provision for Asset Under Securitisation

Provision at the beginning of the yea!
Add: Additional Provisions made during 50.L7
the year
Provision at the close of the Year

3.d Floor, CSI Commercial Centre, BakerJn., P.B. No.227, Kottayam - 686 001
2;gtggg F-118
Mob: 9349870062 | Email: kottayam@[Link]
I Tel: O4g 1 23}Lggg, I I

rivandrum|Ettumanoor|Kochi|Kannur|Ca1icut|Chennai|
http: I [Link]
Vishnu Rajendran & Co
Chartered Accountqnts

NoteI&I:FixedAssets
of Assets Gross Block As at
20L9 31 03 /20L8 31/03 /20L7 3L

Tanpible Assets
74,599.67 1.4,599.67 L4,599.67 27,367.70
4,585.01 5.961.12
Plant & Machine 833.65 1,059:50
Furniture and Fixtures
Vehicles 100.82 183.01 303.48 644.66
Electrical Fitti
Comuuter
Total 20,247.2L 2L,3L6.L2 23,440.95 34,900.18
IEtasslble4sscts
Licences
Software & Licences Jr.f,o
31.58 [Link]'+
82.84 o/'ou
67.60
Total 31.58 82.84 67.60

of Assets 31103/20L9 3L/03/?OLS 3L/03/20L7 3L/O3/2OL6

AssrEqulaIetlDepxesiaugIr
Land
778.52
Plant & Machine 3'1,9.12
Furniture and Fixtures 828.
Vehicles 37.87 57.46 778.24 257,25
Electrical Fitti 77.09 92.03
Computer 41.54 489.33
BLB.42 L,L4+,BB L,453.54 3.526.70
lEla4gildclssets
Software & Licences 17.31 51.25 42.?? -
rotal 17,3L S1..2S 42'29
of Assets 3LlO3/20t9 3t/03/2018 31 20L7 31
Nel-Ialsiblc-Assets
Land
5.782.60
Plant & Machine 7 40.38
Furniture and Fixtures

Electrical Fittin
Computer
t9,428.79 20,L71.24 21,987.4L 3L,373:48
I4anglblcissets
Joftware & Licences t4.28 31.58 80.84
Total 14.28 31.58 80.84

3.d Floor, CSI Commercial Centre, BakerJn., P. B. No.227, Kottayam - 686 001
F-119
lTel: 0481 2301999, 258L999 | Mob: 9349870062 | Email: kottayam@[Link] I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: I [Link]
Vishnu Rajendran & Co
Chartered Accounto;nts

Note K Non-Cument Investments

Particulars 2019 31 20LB 31 oL7 31 03l20L6

Term Investments [At Cost
a)-ouotcd
Equity Shares ofThe So
- -
5'18 5'18
5000
Bank Ltd.
503 Equity Shares of Wonderla , 0.63 0.63 0.63 0.63

Dlnssetcd 367'6t
@K".rl,
Resorts Pvt. Ltd.
Total Non-Current Investments 5.81 5.81 373,42

Note : Deferred Tax Assets

Particulars 20t9 31 03 /20L8 3L 20L7 31 0312016

727.40 795.00 7 44.04 94.82
Openine Balance
Created/(Reversed) during the year on 1.8L.37 (67.60) 50.96 649.22
account of depreciation and Provision of
tui

Note l: Lonq term Loans & Advances

Particulars 20L9 31 20tB 31 OL7 3L 03l20L6

Other Loans and Advances

Income Tax including TDS (Net '1,,665.97

Provisions

1,583.39 L,598.28 L,817.L4 1,981.50

Rent Deposit
security Deposit with NSE, BSI 3!p& 383.75 383.75 383.75 932.95
L.B7 1,.6L L.4B
Other Deposits
Total Long Term Loans & Advances L,969.0L L,983.64 3,868.34 3,402^69

Note : Current Investments

Particulars 3L/03/20t9 3L/03/2OL8 3L/03/20L7 3Ll03l2OL6

Other Short Term Investments (At

Investment in E Gold

Note M: Cash and ivalents

As At
Particulars 019 31 20LB 31 20L7 31

3rd Floor, CSI Commercial Centre, BakerJn., P.B. No.227, Kottayam - 686 001
F-120
lTel: O+A r 23}lggg, 21gtggg I Mob: 9349870062 |
Email: kottayam@[Link] I

rivandrum|Ettumanoor|Kochi|Kannur|Ca1icut|Chennai|
http: / /[Link]:in
Vishnu Rajendran & Co
Chartered Accounta;nts
'ffi]
tt
\\ ,'

a) Balance with banks

In Deposit Account [For 12 months 2,870.35 2,227.92 3,897.27 7,433.55
ln Current Account 4,275.57 6,586.09 2.447.40 3.527.75

b) Cash in hand 7.398.29

Total Cash and Bank Balances 8,342.95 L0,212.30 7,784.98 12.808.85

3'd Floor, CSI Commercial Centre, BakerJn., P.B. No.227, Kottayam - 686 001
F-121
lTel: 0481 231Lggg, 258L999 | Mob: 9349870062 | Email: kottayam@[Link] I

I K"tt"3aa* I Bangalore l Trivandrum .l Ettumanoor I Kochi I Kannur I Calicut I Chennai I

http: //[Link]
 Vishnu Rajendran & Co
Chartered Accountants

Note N: Short term Loans & Advances

As At
Particulars 019 31 018 31 20L7 31
a)Secured
Gold Loan
good
S".urea, Consiaer.a t,gZ,f+0.+e f,SZ,[Link] f,eg,a:O'SS t,gs,ZSg Oe
-[Link] [Link]"red Doubtful 2'872.51 3J62s0 4'66956 5'2969\
Loan aqainst Debentures
Secured, Considered good
Loan against Propert-v
-"c".ed, C"nsid"red c""d
Secured considered Doubtful 91.93 97.93
b)Unsecured
Education Loan
Unsecured, Considered
Personal Loan
Unsecured, considered good 649.67
Micro Finance Loan
Secdred, Considered good 3,192.19 7,240.57 L,329.45
Secured considered Doubtful 22.99
g) Directors and ComPanY Under
Same Management
Secured, Considered

Unsecured, Considered

Total Short Term Loans and Advances L 9,472.95 t.63.078.52 L,95,94O.49 t,9L,3L9.41

Loan and advances due

al Directors
b) Other 0ffices of the company either
severally or jointly with any other
rSONS
cJfirms or private comPanies
respectively in which any director is a
artner or a director or a member

Total

BakerJn., [Link].227, Kottayam - 686 001

3'd Floor, CSI Commercial Centre,
F-122
lTel: 0481 2301999,25819'99 lMob: 9349870062 lEmail: kottayam@[Link] I

;[Link]
http: I [Link]
Vishnu Rajendran & Co
Chartered Accounta;nts ffi
Note O: Other Current Assets

As At
Particulars 31 03 20L9 31 03 20L8 31 o3 oL7 31 03 20L6

Denosits 0.96 0.96 0.85 0.85

Other Advances /Receivables 92.33 62.04 L13.58 99.00
Asset Under Securitisation L2,542.62
Others 284.28 350.32 560.99 830.66
Income Tax Including TDS (Net of '1,,726.57
1,533.05
Provisions
Total Other Current Assets 14,453.24 2,L39.89 675.42 930.51

Annexure - V: Notes to Ref

Note P:Revenue from Operation {ln Lacs
For the year ended
Particulars 31 03 2019 31 03l20L8 31/0312017 3110312016

a) Interest
On Gold Loan 26,97 [Link] 27,920.65 39.269.64 36,587.56
On Auction 866.77 3.847.78 3,4L0.96 L,797.98
On Income Generated Loan 354.33 883.93 58.21,
0n Loan Aeainst Debentures 78.L9 13.68 35.24
On Personal Loan 9.00 332.63
On Term Deposits 208.69 203.34 283.75 L62.47
Others 57.49 77.94 7 4.37
.9.27
'29,453.04 32,95,..83 43 118.95 38,925.15

b) Other Financial Services

Commission & Brokerage 74.57 153.15 180.49 754.89
Other operatins Income 84.83 155.18 97.97 25.31
L59.40 308.33 272.45 180.20

Total Revenue from OPerations 29,6L2.4+ 33,260.L6 43.39L.40 39,105.3 5

3'd Floor, CSI Commercial Centre, Baker Jn., P. B. No. 227, Kottayam - 686 001
F-123 Email: kottayarl:@[Link]
lTel: 0481 23OL999, 258L999 | Mob: 9349870062 | I

I Kottayam I Bangalore I Trivandrum l. Ettumanoor I Kochi I Kannur I Calicut I Chennai I

http: //[Link]
Vishnu Rajendran & Co
Chartered Accountants .cel
: Other Income
?ln Lacs
For the ar ended
Particulars 31 03 019 31 03l20L8 31,103 oL7 31 03l20L6

a) Dividend Income 0.20 0.19 0.23 0.28

b) Other Non Operating Income
Rental Income 706.52 L2\.77 t70.77
Profit on sale of Car 11.89 34.71, 40.06 5.27
Profit on sale of Asset 42.68
Insurance claim received 20.67
Miscellaneous Income 63.7 6 34.48 4.56 3.49

Total Other Income 203.04 233.23 15 5.02 9,O4

Note R: Em Benefits E ? In Lacs

For the ear ended
Particulars 3t 03 20L9 31 03 /20L8 3Ll03l20L7 31 03 /20L6

a) Salaries & Wases

Directors remuneration L75.27 118.03 98.25 741,.20
0thers 688.67 772.22 8L2.29 7 63.64
Gratui 3L.57 87.94 86.80 L64.90
5,230.79

Total E Benefit 5.837.99 6,208.98 5.805.46

Note S: Finance Costs

'In Lacs
For the r ended
Particulars 3L 03 019 31 03 /2018 3Ll03 20L7 31 03l20L6

Interest Expenses:
Interest on Debentures 4,773.27 5,925.73 7,675.73 5,026.79
Interest on Public lssue NCD 967.58 8,91,6.52 L2,678.21 L3,41,5.94
lnterest on Application Mon NCD t4.06 14.28 L0.78 346.02
Interest on Loan 5,040.64 4,530.7 6 3,936.9L 2,542.84
Others 265.50 L06.02 188.61 184.18
Total Finance Cost L6,46t.05 L9,493.3L 24 .25 2L,5L5.77

Note T: Depreciation and Amortization

For the ear ended

Particulars 3L 03 019 31 03120L8 3Lt03 0L7 31 3'IW16

3'd Floor, CSI Commercial Centre, BakerJn., [Link].227, Kottayam - 686 001
F-124
Tel: 0481 23OL999 , 2581999 | Mob: 9349870062 | Email: kottayam@[Link] I
I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
Vishnu Rajendran & Co
'

Chartere d Acc ounta;nts

Depreciation 835.73 L,796.L3 L,495.82 1,956.08

Amortization of Public Issue Expenses 46.\7 L47.32 258.09 246.26
Total 881.90 1,343.45 1,753.9L 2,202.34

Jn., P. B. No.227, Kottayam - 686 001

3rd Floor, CSI Commercial Centre, Baker
F-125
lTel: 0481 23OL999, 258L999 | Mob: 9349870062 I Email: kottayam@[Link] I

I Kottayam lBangalore lTrivandrum l-Ettumanoor I Kochi I Kannur I Calicut I Chennai I

[Link]
Vishnu Rajendran & Co
Chqrtered Accountqnts

Note U:Operatinq & Other ? In Lacs

For the year ended
Particulars 31 o3l20l9 31 03l20L8 3LlO3 /20L7 31 03 20L6
Power and Fuel 205.4L ZLL.45 2L9.57 77L.65
'J,,846.65 798.72 2,089.00 347.68
Rent
Renairs & Maintenance 270.50 798.96 96.80 L64.9L
Insurance 80.03 89.15 73L.62 7L2.28
Rate & Taxes. excluding tax on income 743.89 200.24 233.85 75.73
Payments to auditors 79.63 L9.62 15.90 L7.36
OtbelExpegses
Commission paid LLg.29 82.22
Business Promotion Expenses 26.78 13.03 328.93 128.64
General 0ffice 252.77 385.
85.47 372.42 21_9.58
Advertisement Charees L1,.33 24.53
4.53 50.83 93.99
Bad Debt written off 2.43 .78 8L1.67
Travellins Expenses:
Directors
- Others 186.50 215.58 253.61 425.17
Leeal Professional charges 81.81 139.08 78.41 7L1.24
Telephone Charges 164.59 195.50 236.80 255.97
Postase & Courier 56.28 19.6L 28.78 2L.58
Printins and Stationer 133.59 L47.30 1,57.44 L77.24
Miscellaneous Expenses 1,25.90 38.89 L3.92 2.23
Provision for Non-Performing Assets 297.30 27.38 3.7 0 767.7 4

Contineent Provision for Std. Assets 54.82 11.58 97.63 81.90

Provision for Asset Under Securitisation 50.17
Vehicle Running & Maintenance Ex 11.68 12.29 L2.79 2L.00
Securitv Charees L6L.42 275.48 304.43 305.73
Trainine & Meeting Expenses 11..86 43.48
Subscription Charges- Spot Exchange L6.74 2.39 2.66 1.60
Loss on sale of Fixed Asset 5.33 L.67 6.15
DP accounting Opening charges 0.11 3.L3
Coroorate Social Responsibili 7.45 89.07
Expenses of Public Issue NCD 29.69 65.20 122.70 62.76
Investments Written off 294.09
Provision for diminution in value of 73.52
Investment
Total Operatine & Other 4,055.96 3,965.05 5,2L8.89 068.56

Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
F-126
lTel: 0481 2301999, 2581999 | Mob: 9349870062 I Email: kottayam@wc. [Link] I

lKottayamlBangalorelTrivandrumIEttumanoorlKochilKannurlCalicutlChennail
http: //[Link]
 /" -'-

Vishnu Rajendran & Co

Chartered Accountants

Annexure - VI: Statement of Secured Loans and Unsecured Loans

1 Secured Loans lln Lacs
As At
Particulars 31 03 019 31 03 20L8 31 03 20L7 31 03 20L6
ti) Debentures
(a) Secured Redeemable NCD - Public 10,900.08 29,334.64 57,846.77 95,898.48
Issue (For details relating to repayment
terms, interest rate and security offered,
refer Note C and F above
(b) Secured Redeemable PrivatelY 3,533.19 L1.,577.55 1,9,928.71 35,050.18
placed NCD (For details relating to
repayment terms, interest rate and
security offered, refer Note C and F
above
(iil ferm foans from g
(a) South Indian Bank Ltd. Secured by 479.07 1,100.55 1,782.03
Hypothecation of Fixed Assets
purchased /Security DePosits of
[Link] be repaid in 10 equal half
instalments with interest @L3o/o
tb) South Indian Bank Ltd. Direct 1.4,6L4.93
assignment of Receivables pertaining to
the oool of asset purchased.
(b) Dhanalakshmi Bank Secured by way 208.33
of Pari-passu first charge bY way of
hypothecation of Book Debts to the
extent of 1,00o/o of the exposure created
out of funding repayable in 15 months
interest rate @ 17.50o/o
[cJ HDFC Bank Limited Car Loan (Benz 18.L1 37.95
G350) ( Secured by Hypothecation on
vehicle and is to be repaid in 60 equal
monthly installments with interest @
9.950/o o.a
[d) HDFC Bank Limited Car Loan [BenzJ 1,.62 10.79 19.10
( Secured by Hypothecation on vehicle
and is to be repaid in 60 equal monthly
installments with interest @ 9.95o/op.a
[e) HDFC Bank Limited Car Loan 36.44 60.55
flaquar) fsecured by Hypothecation on
vehicle and is to be repaid in 60 equal
monthly installments with interest @
10.750/o)
t0 HDFC Bank Limited Car Loan 0.86 4.09 7.00
Qnnova) (secured by Hypothecation on
vehicle and is to be repaid in 60 equal
monthly installments With interest @
I0.50o/o

Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
F-127
lTel: 0481 2301999,2581999 lMob: 9349870062 I Email: kottayam@vrc. [Link] I

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Chartered Accountants

(g) SIB, Pathanamthitta Car Loan 96.43

(secured by Hypothecation on vehicle
and is to be repaid in 60 equal monthly
installments with interest @ L0.50o/o
(h) HDFC Bank Limited car Loan BMW 4.77 22.68 38.91 53.58
X 5 (secured by Hypothecation on
vehicle and is to be repaid in 60 equal
instalments with interest @ 70o/o
4.86 8.61 L2.00 L5.07
Jetta(secured by Hypothecation on
vehicle and is to be repaid in 60 equal
instalments with interest @'J-|o/o)
(j)SBI Car Loan fSecured against the 80.24
hypothecation of Vehicle to be repaid in
84 equal monthly installments with
interest @L0.40o/o)
(iii) Working Capital Loan from

(a) South Indian Bank Ltd. [For details L6,533.31 15,47 8.7 0 L2,384.87 2,744.25
on interest rate and security offered,
refer Note E)
tb) Federal Bank Ltd. (For details on 3,638.79 3,265.98
interest rate and security offered refer

[c) State Bank of India (earlier State 4,503.62 3,484.75 3,53L.43 2,623.98
Bank of Travancore) (For details on
ihterest rate and security offered refer

td) Dhanalakshmi Bank [For details L,273.46 L,566.4\ 2,008.02 1,207.06

on interest rate and securitY offered
refer Note
(e) State Bank of India [For details 4,929.45
on interest rate and security offered
refer Note E
t0 Andhra Bank (For details on 5,047 .7 0 7,[Link] 4,945.20 2,002.55
interest rate and security offered refer
Note
(g ) Indus Ind Bank [For details on 4,525.42 3,337.54 4,981.49
interest rate and security offered refer
Note EJ
(h) Oriental Bank Of Commerce [For l_,585.98 4,035.20 2,500.25
details on interest rate and security
offered refer Note E)
ti) Union Bank Of India [For details 2,1.00.72 2,435.48 2,479.22
on interest rate and securitY offered
refer Note E
tj) Reliance Capital Limited (For L,927.34
details on interest rale and security
offered refer Note E

Jn., P. B. No.227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
F-128
lTel: 0481 23OL999,2581999 lMob: 9349870062 lEmail: kottayam@[Link] I

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 Vishnu Rajendran & Co
Chqrtered Accountqnts

Total Secured Loans 64,568.04 79,368.55 1,17,326.32 1,51,7?3.16

2 Unsecured Loans (ilIn Lacs)

Particulars 3U03/2o1 3L/03/201 3L/03/zOL 3L/03lzOL
9B 76
a)Unsecured Debentures Listed [For 23,356.26 23,356.26 23,356.26 23,356.26
details on interest rate and repayment
terms, refer Note C 3 and F1J
b)Unsecured Debentures [For details on 1,528.50 L,742.27 640.45 590.45
interest rate and repayment terms, refer
Note C and F1)
cJLoans from Directors
d)Subordinate Debt (For details on 20,467.07 20,467.07 20,467.07 9878.04
interest rate and repayment terms, refer
Note C)
Total Unsecured Loans 45,351.83 44,965.54 44,463.78 33,824.75

3'd Floor, CSI Commercial Centre, BakerJn., [Link].227, Kottayam - 686 001
F-129
f Tel: 0481 2301999, 2581999 | Mob: 9349870062 | Email: kottayam@[Link] I

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Annexure - VII: Statement of Accounting Ratios

{ln Lacs
Particulars 31/03/201e 3Ll03lzOLB 3L/03/2017 3t/03/20L6

Earninss Per Share - Basic [t 8.40 4.3L 6.04 4.35

Earninss Per Share - Diluted [t 8.40 4.31 36.04 4.35
Return on Net Worth [% 4.730/o 3.38o/o 22.77o/o 2.20o/o
Net Asset Value per Equitv Share [t L77.46 L69.70 L62.56 197.51
Weighted Avg. No. of Equity Shares used 2,49,52,539 2,37,28,628 2,25,00,000 2,25,00,000
in calculatine Basic EPS
Weighted Avg. No. of Equity Shares used 2,49,52,539 2,37,26,628 2,25,00,000 2,25,00,000
in calculatins Diluted EPS
Total No. of Equity Shares outstanding 2,49,52,539 2,49,52,539 2,25,00,000 2,25,00,000
at the end of the year / period

Notes: The ratios have been computed as below:

1. Earnings per Share = Net Profit/ [LossJ as reformatted attributable to equity shareholders /
Weighted average number of equity shares outstanding during the year [Reformatted)
2. Return on Net Worth (o/oJ = Net Profit/ [LossJ after tax, as reformatted / Net Worth as reformatted
3. Net Assets Value per Equity Share (t) = l,let Worth as reformatted Number of equity shares
/
outstanding at the end ofthe year
4. Net Worth = Equity Share Capital (+) Reserves and Surplus excluding revaluation reserves and
deferred revenue expenditure.
5, Earning per share calculations are in accordance with Accounting Standard 20 "Earning per share".

Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
lTel: 0481 2301999, 258L999 | Mob: F-130
9349870062 | Email: kottayam@[Link] I

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Vishnu Rajendran & Co
Chartered Accounto;nts

Annexure - VIII: Statement of

Dividend
(?In,Lacs)
Particulars 3L/03/20L9 3L/03/20L8 31/03120L7 31/03/20L6
On Equity Shares
Fullv Paid-up Share Capital [Nos.) 2,49,52,539 2,49,52,539 2,25,00,000 2,25,00,000
Face Value / Paid Up Value [t

Equity Share Capital ftln lacs) 24,952.54 24,952.54 22,[Link] 22,500.00

Rate of Dividend
Dividend
Dividend Distribution Tax

Annexure - IX: Statement of Contingent Liabilities

(IIn Lacs)
Particulars 3UO3/2O1e 3L/03/2OL8 3L/03/20L7 3U03/20L6

Contineent Liability t,171,.87 7,224.51 695.92 557.47

Annexure - X: Statement of Tax Shelter

(1ln Lacs)
Particulars 03l20L9 31 03 /20L8 31 03 /20L7 31 03l20L6
Profits/ (Losses) before taxes as per 2,578.58 2,482.60 (8,746.981 1,91.3.26
books fA')
Income Tax Rates fincluding surcharge 33.99o/o 33.99o/o 33.99o/o 33.990/o
and education cessJ applicable fB)
Tax Exnenses fC . 664.35 1,584.50
PcllqaEenrDiffere4ses
Provision for NPA and standard assets
Any disallowances
Dividend Income
Agricultural Income
Total Permanent Differences (D) 286.45 [39.15] 101.10 249.36
TiminE Differences
Difference between Tax and book (1.8L.37) 67.60 (so.e7) (64,e.22)
Depreciation or vice versa [DTA)/DTL
Other Adiustments [DTA)/DTL
Total Timins Differences [E ) t181..37) .60
67 [50.97) (649.22)
NetAdiustments [F) = [D + E) 105.08 28.45 50.13 [399.86)
Tax impact of adjustments 35.72 9.67 77.04 [13s.e1)
(G)=[F)*(B)
Taxable Income (H) = [A + F ) 2,683.66 2,5L1.05 [8,095.87) 3,722.40
Tax provision based on taxable 912.18 853.50 1,061.30

Total tax provision for current tax

Deferred Tax Charses/" fCredit
Total tax exoense/ tCredit) duri 1,058.01

BakerJn., [Link].227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre,
I Tel: 0481 2301999, 2581999 |
Mob: F-131
9349870062 | Email: kottayam@[Link],in I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: l/[Link]
 .......'..\.
/-.--.....'......,.'......''......,'

Vishnu Raiendran & Co

Chartered Accountants l
the yearcn timing difference (M) =

*otttt
'Notes:
,
1 The ,[Link]'
, ;;:;:;:;; :; is based on the Profit/ (Losses 1 ,s pe. the "Reformatted
and Losses"'
)ulrllltat Y Statement
Summary "' Profit
JtdusrrrsrrL of ^ '"^'* -'
e Deferred Tax Liability / Asset as
[Link],,a,.aAsseffiedforcalculatingtheDeferr . -r!-- ^^ ^c nEtr and
[Link].t of RBI ^nrl in
in fha
'r nnininn or
the opinion nf the
the
SrJTI:'utLf :"[Link] ?.**,ory provision as per the
.o*prrv, it does not result in a t

ies and Nature of RelationshiPs

sl. slloslzots @ ttloslzotz 3Llo3l2ot6

No. [Link]*
Nizzv Mathew Nizzy Mathew
Nizzv Mathew Nizzy Mathew
Mathew Muthoottu Mathew Muthoottu Mathew
Mathew Muthoottu Muthoottu
Kurian P Abraham
Ann Mary George
Smitha K S

tions have taken place during

the period)

3L/03 /20L8 3L/03l2OL7 3t103120L6

sl, 3L/031201e
No.
Rov M Mathew Roy M Mathew
Roy M Mathew
SarammaMammen SarammaMammen
SarammaMammen SarammaMammen
Rubben Mathew Rubben Mathew
Minu Sara
Minu Sara Mathew Minu Sara Mathew Mathew
Nirmal Mathew Nirmal Mathew Nirmal Mathew
Nirmal Mathew
Mono Mathew
Mammen Mathew Mammen Mathew Mammen Mathew
Mammen Mathew

relatives of KMP has ficant influence:

C. Enti in which KMP
3Ll03 /20L7 3L103 6
Sl. No. 31103 /20t9 3LlO3l20L8
Mini Muthoottu Nidhi Mini Muthoottu Nidhi Muthoo
Mini Muthoottu Nidhi
\ Kerala Ltd.'l Kerala Ltd. Kerala Ltd. Builderbfr
Mini Muthoottu Mini Muthoottu Muthoottt
Mini Muthoottu
Nirman & Real Estate Nirman & Real Estate
Nirman& Real Estate

3.d Floor, CSI Commercial Centre, BakerJn', P'B' No' 227' Kottayam - 686 001
F-132
g34gg:70062 I Email: kottayam@[Link]'in
lrel: 0481 zsotggg, 2sgrggg I Mob:
I

i I Kannur I Calicut I Chennai I

http: / /[Link]
 /'\
Vishnu Rajendran & Co
Chqrtered Accounta;nts cel
\_*_* _- .__ ..-_._.__,/

Pl Ltd. Pl Ltd. Limited

Ltd.
Muthoottu Mini Muthoottu Mini
Muthoottu Mini Hotels
Hotels Private Limited Hotels Private Limited
Private Limited

Annexure - XI - B: Transactions with Related Parties in Lacs

M rial Personnel
20L9 3L 018 31 oL7 3LlO3 20L6
Particulars
Transactions during the 89.10 121,.60
L11.80 LLZ.00
Directors remuneration
n.*un..ation to KeY Managerial 43.69
Person 72.36
3.93
Travelling Ex 47.3t
4.55 6.23 6.23
Rent paid
Rent received 302.28
0.75
Debenture redemPtion
r.7 6
Interest on debenture 20,000.00
881.00
Sale/fPurchase) of 8ry4 4qqgll 8.00
Issue of debentures

e Net Amt. Receivable / (Due) as at

the vear end
AilountPryable at the Year/Period
end
3.54
Amt. Receivable at the year/period
end

Relatives of K rial Personnel

20t9 31 018 31 20L7 31 oL6
Particulars
A Transactions du the
18.00 2.5.20
Salarv & Allowances
1,.20
ConsultancY Charges LTO
24.50
Debenture redemPtio4 1.80
3.20 3.08
Interest on debenture L.26
Travelling Expense 5,11
14.85 15.56
Rent paid
9,008.58
Sale / fPurchase) olIUq44qqqlq
B Net Amt. Receivable / (Due) as at
the year end
A*"rrt PaYable at the Year/Period
end
emt Receivable at the Year/Period
end

3.d Floor, CSI Commercial Centre, BakerJn., P.B. No.227, Kottayam - 686 001
F-133 Email: kottayam@[Link]
f rel: 04g 1 2zorggg, 2sl|ggg I Mob: 9z49g:10062 |
I

ochi l Kannur l Calicut l Chennai I

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Chartered Accountqnts \--'-..--'/

3 Entity in which KMP relatives of KMP has significant influence

Particulars sLlOsl?OLe 3Llo3/2018 31 ot7 31
Transactions d rf
Rent/Maintenance Cha a id
Rent/Maintenance Cha es received

B Net Amt. Receivable / (Due) as at

the vear end
Amount Payable at the Year /Period '
end
Amt. Receivable at the year/period
end

3rd Floor, CSI Commercial Centre,BakerJn., [Link].227, Kottayam - 686 001

F-134
I Tel: 04g
1 23}tggg, 21gLggg I Mob: 9349870062 | Email: kottayam@[Link] I

',a*mlBttumanoor|Kochi|Kannur|Ca1icut|Chennai|
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Chartered Accounta;nts
\.---_ _ , ._,i

Annexure - XII - Significant Accounting Policies and Notes to the Financial Statements

SIGNIFICANT ACCOUNTING POLICIES

I. BACKGROUND

Muthoottu Mini Financiers Limited was incorporated as a Private Limited Company on l8th March
1998 and was converted into a public Company on 27th Novemb er 20L3. The Company is promoted
by Dr. Nizzy Mathew and Mr. M. Mathew collectively operating under the Brand Name of 'Muthoottu
Mini Group' which is in the business of lending money against the pledge of household used gold
jewellery (gold loans). The group has diverse interests in the fields of Financial Services,, Foreign
Exchange, Insurance distribution, Hospitality etc. The company has obtained certificate of
registration from the Reserve Bank of India for carrying on the business of Non-Banking Financial
Institutions on 13th April 2002 vide Regn. no. N-16.00175, which was renewed on 1st fanuary 20L4
pursuant to its conversion as a public limited company. The Company is presently classified as
Systemically Important Non- Deposit Taking NBFC [NBFC-ND-SI).
The reformatted summary statement of assets and liabilities of the Company as on 31st March 201,9,
31st March 2078,31st March 2017 and 31st March 2016 and the related reformatted summary
statement of profits and losses and cash flows for the years ended 3Lst March 2019,3Lst March
2078,31st March 201,7 and 31st March 2076 fhereinafter collectively referred to as "Reformatted
Summary Statements") relate to Muthoottu Mini Financers Limited ("the Company").

II. Statement Of Significant Accounting Policies Adopted By The Company In The Preparation
Of Financial Statements For The Years Ended March 31st 2OL9 /2015 / 2OL7 and2}L6z

A. Basis for preparation of Financial Statements

The Financial statements have been prepared and presented under the historical cost convention on
accrual basis of accounting, in accordance with Generally Accepted Accounting Principles (GAAP) in
India which comprises of mandatory Accounting Standards as prescribed under section 133 of the
Companies Act, 20L3 read with rule 7 of the Companies (Accounts) Rules, 20'1,4, except where
otherwise stated, the accounting policies have been consistently applied.

B. Use of Estimates
The preparation of financial statements in conformity with Generally Accepted Accounting Principles
(GAAP) requires making of estimates and assumptions by the management that affect the reported
amounts of assets and liabilities of the financial statements and the reported amounts of the
revenues and expenses during the reporting period. Differences between actual results and
estimates are recognized in the period in which the results are known/ materialized.

3.d Floor, CSI Commercial Centre, Baker

Jn., P. B. No. 227, Kottayam - 686 001
F-135
lTel: 0481 2301999, 2581999 | Mob: 9349870062 I Email: kottayam@[Link] I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
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Chartered Accounta;nts c&l
\___-__ -__....-_._./

C. Current - non-current classification

All assets and liabilities are classified into current and non - current.

Assets
An asset is classified as current when it satisfies any of the following
criteria:

in, the company's normal

a. It is expected to be realised in. or is intended for sale or consumption
/
operating cycle.
b. It is held primarily for the purpose of being traded.
c. It is due to be settled within l-2 months after the reporting date.
d. It is cash or cash equivalent unless it is .restricted from being exchanged or used to settle
liability for at least 12 months after the reporting date.

Current assets include the current portion of non-current financial assets.

All other assets are classified as non-current'

Liabilities
A liability is classified as current when it satisfies the following criteria:

a. It is expected to be settled in the company's normal operating cycle'

b. It is held primarily for the purpose of being traded:

C. It is due to be settled within 12 months after the reporting date; or

settlement of the liability for at least

d. The company does not have an unconditional right to defer
could, at the option of the counter
L2 months after the reporting date. Terms of the liability that
not affect its classification'
party, result in its settlement by the issue of equity instruments do

financial liabilities'
current liabilities include the current portion of non current

All other liabilities are classified as non-current.

D. PropertY Plant and EquiPment

Tangible Assets
acquisition or construction less
Tangible Assets except land are stated at historical cost of
accumulated depreciation.
;Pl, \,rvrqLrvrr. cost
vvv comprises the purchase price and any attributable cost "f .N i. il
;-

to its working condition for its intended use. Borrowing costs directly attrib'u't
the asset
as part of the cost of the assGl
acquisition or copstruction of qualifying assets are capitalized -l !
the borrowing cost is capitalized
the date the asset is ready for the intended use or sale. And

- 686 001
3d Floor, CSI Commercial Centre, BakerJn., P.B. No.227, Kottayam
9349gz0062
F-136 Email: kottayam@[Link]
lrel: 0481 23otggg, 2sgtggg I Mob: | I

I Ettuman*r I Kochi I Kannur I Calicut I Chennai I

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Vishnu Raiendran & Co
Chartered Accountants c&l
\./
useful life and method of
the provisions of Accounting standard 16. The residual values,
appropriately'
depreciation of fixed assets are reviewed each year and adjusted
Intangible Assets
Intangible Assets are amortized over their expected useful
life. It is stated at cost, net of
amortization. The computer software is amortized over
a period of three years on written down
value method.

[Link]
Depreciation on Fixed Assets is provided on the basis of
estimated useful life of assets as per
Schedule II of the ComPanies Act, 20\3.

F. Impairment of Assets
date to ascertain impairment
The carrying amount of assets are reviewed at each balance sheet
based on internal /external factors. An impairment loss
is recognized,when the carrying amount of
asset exceeds it recoverable amount. The recoverable
amount is the higher of the net selling price of
,assets or their value in use. After impairment, the depreciation is provided on the revised
carrying
recognized, impairment loss is increased
amount of asset over its remaining useful life. A previously
value after reversal !s not
or reversed depending on change in circumstances. However, carrying
increased beyond the carrying value that would have
prevailed by charging usual depreciation if
there was no dePreciation.

G. Revenues Recognition
is recognised to the extent it is probable that the economic benefits will flow to the
Revenue
where management believes that
company and the revenue can be reliably measured. In a situation
price of the gold or otherwise, the company
the recovery of interest is uncertain due to change in the
recognises income on such loans only to the extent
it is confident of recovering interest from its
customers through sale of underlying security or otherwise'

basis taking into account the

Interest income on loans given is recognised on a time proportion
amount outstanding and the rate applicable. Such interests,
where instalments are overdue in
Any such income recognised
respect of non-performing assets are recognised on realisation basis.
and remaining unrealised after the instalments become overdue
with respect to non-performing
assets is reversed. Revenues from fee-based activities are
recognised as and when services are
rendered.
H. Segment RePorting
"Gold Loan" and its operations are in lndia' Since
The company primarily operates in the business of
as per AS 17 'segment Repottilg',
the company has not operated in any other reportable segments,
no segment reporting is applicable'
I. Investments

3rd Floor, CSI Commercial Centre, Baker B' No. 227, KottaYam - 686 001
Jn', P'
F-137
I Tel:
0481 23olggg , 2581999 | Mob: 9349870062 I Email: kottaYarrl@[Link] I

m l Ettu*.rr* l Kochi l Kannur l Calicut l Chennai I

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Chartered Accountants

i. Investments [Non-trade) are considered as long term and are stated at cost. Trade investments
are recorded at the lower of cost and fair value determined either on an individual investment basis
or by category of investment, but not on an overall for globalJ basis.

f. Accounting for Taxes on Income

i. Provision for current tax is made based on the liability computed in accordance with the
relevant tax rates and tax laws.
ii. Deferred tax is recognized on ali timing differences between accounting income and taxable
income for the year, and quantified using the tax rates and laws enacted or substantively enacted as
on the Balance Sheet date.
K. Earnings per Share
In accordance with Accounting Standard 20 (AS-20), 'Earnings per share' issued by the Institute of
Chartered Accountants of India, basic and diluted earnings per share is computed using the weighted
average number of equity shares outstanding during the period.

L,. Accounting for Provisions

Provisions involving substantial degree of estimation in measurement are recognized when there is
a present obligation as a result of past events and it is probable that there will be an outflow of
resources. These are reviewed at each balance sheet date and adjusted to reflect the current
management estimates.
Provision for non-performing assets are created as per management estimates, subject to minimum
provision required as per Systemically Important Non-Banking Financial [Non-Deposit Accepting or
Holding) Companies Prudential Norms fReserve Bank) Directions 20L6, issued on 1st September,
2076 (updated as on 16th May, 2079)

M. Debenture Redemption Reserve

The transfer to debenture redemption reserve is from available distributable profit of the year
subject to maximum of 25o/o of value of the non-convertible debentures raised through public issue
as per the Circular No. 04/20L3 issued by the Ministry of Corporate Affairs, for NBFCs registered
with the RBI under section 45 of the RBI fAmendment) act, 1,997.

N. Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognized only when the company has present, legal or constructive obligations
a result of past events, for-which it is probable that an outflow of economic benefit will be required
to settle the transaction and a reliable estimate can be made for the amount of obligation.

events not wholly within the control of the company or present obligation arising from past events

Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
F-138
lTel: 0481 23OL999, 2581999 | Mob: 9349870062 I Email: kottayarn@vrc. co. in I

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Vishnu Rajendran & Co
Chartered Accountants C&
\*_.-.__,,__,, -_ _

where it is not probable that an out flow of resources will be required to settle the obligation or a
reliable estimate of the amount of the obligation cannot be made. Contingent Assets are neither
recognized nor disclosed in the financial statement.

O. Borrowing Costs and Debenture Issue Expenses

Borrowing costs that are directly attributable to the acquisition, construction or production of a
qualifying asset are be capitalised as part of the cost of respective asset. All other borrowing cost
are expensed in the period in which they occur.
Issue expenses of public issue of debentures and borrowings costs for raising other long term
borrowings are amortized over the period of debentures and over the tenure of loan on pro rata
basis.

P. Short term Employee Benefits

All employee benefits payable wholly within twelve months of rendering the service are classified as
Short term employee benefits. These benefits include benefits like salaries, wages, short term
compensated absence such as paid annual leave and sick leave. The undiscounted amount of short
term employee benefits expected to be paid in exchange for the services rendered by employees are
recognized as an expense during the period.
Q. Long term Employee Benefits
Defined contribution plans:
Defined contribution plan is adopted for Provident Fund scheme administered by Government for all
eligible employees. The company's contribution to defined contribution plan is recognized in the
Statement of Profit & Loss in the financial year to which they relate.

Defined Benefit Plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or
more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed
year of service. The company makes provision for gratuity, every year end, for employees who has
completed at least one year of service.

R. Events occurring after the Balance Sheet Date

Material Events occurring after the Balance Sheet date are taken into cogn izancewhile preparing the
financial statements.

S. Related Party Disclosures

Disclosures are made in accordance with the requirements of Accounting Standard 18 "Related P
Disclosures" read wjth the clarifications issued by the Institute of Chartered Accountants of Indifi;:'
',, r- 1F,l

Jn., P. B. No. 227, Kottayam - 686 001

3.d Floor, CSI Commercial Centre, Baker
F-139
lTel: 0481 2301999, 2581999 | Mob: 9349870062 I Email: kottayam@[Link] I

lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: l/[Link]
 """""'""""-\
t"-""""""""""""

Vishnu Rajendran & Co

Chantered Accountants

auction of pledged gold

T. Surplus on
The Company has a policy of refund of any surplus that arises on auction of pledged gold which has
been re-possessed by the Company in accordance with the terms of the agreement with the
customers and auction policy.

U. Expenditure on Corporate Social R"rporrribility (CSR)

The Company accounts the expenditure incurred towards Corporate Social Responsibility as
required under the Act as a charge to the statement of profit and loss.

V. Cash FIow
The company reporting cash flow statement in indirect method, whereby net profit or loss is
adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or
future operating cash receipts or payments, and items of income or expense associated with
investing or financing cash flows.

lp-.-.4-dA?61
Jn., P. B. No. 227, Kottayam - 686 001
3"d Floor, CSI Commercial Centre, Baker
F-140
tTel: 0481 2301999,2581999 lMob: 9349870062 I Email: kottayam@vrc. co. in I
lKottayamlBangalorelTrivandrumlEttumanoorlKochilKannurlCalicutlChennail
http: l/[Link]
 Muthoottu Mini Financiers Limited

SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN INDIAN GAAP AND IND AS

The reformatted financial statements of the Issuer included in this Draft Prospectus / Prospectus is presented in
accordance with Indian GAAP for March 31, 2016 to March 31, 2019, which differs from Indian Accounting
Standards (Ind AS) in certain respects. The Ministry of Corporate Affairs (MCA), in its press release dated January
18, 2016, issued a roadmap for implementation of Ind AS converged with IFRS for non-banking financial
companies, scheduled 50 commercial banks, insurers, and insurance companies, which was subsequently
confirmed by the RBI through its circular dated February 11, 2016. The notification further explains that NBFCs
whose equity and/or debt securities are listed or in the process of listing on any stock exchange in India or outside
India and having a net worth of less than `50,000 lakh, shall comply with Ind AS for accounting periods beginning
from April 1, 2019 onwards with comparatives for the periods ending on March 31, 2019 or thereafter. Therefore,
the Issuer would be subject to this notification.

“Summary of Significant Differences among Indian GAAP and Ind AS”, does not present all differences between
Indian GAAP and Ind AS which are relevant to the Issuer. Consequently, there can be no assurance that those are
the only differences in the accounting principles that could have a significant impact on the financial information
included in this Draft Prospectus / Prospectus. Furthermore, the Issuer has made no attempt to identify or quantify
the impact of these differences or any future differences between Indian GAAP and Ind AS which may result from
prospective changes in accounting standards. The Issuer has not considered matters of Indian GAAP presentation
and disclosures, which also differ from Ind AS. In making an investment decision, investors must rely upon their
Draft Prospectus / Prospectus. Potential investors should consult with their own professional advisors for a more
thorough understanding of the differences between Indian GAAP and Ind AS and how those differences might
affect the financial information included in this Draft Prospectus / Prospectus. The Issuer cannot assure that it has
completed a comprehensive analysis of the effect of Ind AS on future financial information or that the application
of IND AS will not result in a materially adverse effect on the Issuer’s future financial information.

Summary of Possible/Anticipated differences among Indian GAAP and Ind AS:

Treatment as per Indian

[Link]. Particulars Treatment as per Ind AS
GAAP
1. Presentation of Other Comprehensive Income: Other Comprehensive Income:
Financial There is no concept of ‘Other IndAS1 introduces the concept of
Statements Comprehensive Income’ under Other Comprehensive Income
Indian GAAP (“OCI”). Other comprehensive
income comprises items of
income and expense(including
reclassification adjustments) that
are not recognized in profit or loss
as required or permitted by other
Ind AS. Such recognition of
income and expenses in OCI is
primarily governed by the income
recognition norms and
classification of financial
instruments and assets as “Fair
Value through OCI.”
Extraordinary items: Extraordinary items:

Under Indian GAAP, Under Ind AS, presentation of any

extraordinary items are items of income or expense as
disclosed separately in the extraordinary is prohibited.
statement of profit and loss and
are included in the
determination of net profit or
loss for the period.

Items of income or expense to

be disclosed as extraordinary
should be distinct from the
ordinary activities and are

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 Muthoottu Mini Financiers Limited

Treatment as per Indian

[Link]. Particulars Treatment as per Ind AS
GAAP
determined by the nature of the
event or transaction in relation
to the business ordinarily
carried out by an entity.
Change in Accounting Policies Change in Accounting Policies

Indian GAAP requires changes Ind AS requires retrospective

in accounting policies to be application of changes in
presented in the financial accounting policies by adjusting
statements on a prospective the opening balance of each
basis (unless transitional affected component of equity for
provisions, if any, of an the earliest prior period presented
accounting standard require and the other comparative
otherwise) together with a amounts for each period presented
disclosure of the impact of the as if the new accounting policy
same, if material. had always been applied, unless
transitional provisions of an
If a change in the accounting accounting standard require
policy has no material effect on otherwise.
the financial statements for the
current period but is expected to
have a material effect in the later
periods, the same should be
appropriately disclosed.
2. Deferred Taxes Under Indian GAAP, the As per Ind AS 12 Income Taxes,
Company determines deferred deferred tax is determined with
tax to be recognized in the reference to the balance sheet
financial statements with approach i.e. based on the
reference to the income differences between carrying
statement approach i.e. with value of the assets/ liabilities and
reference to the timing their respective tax base.
differences between profit
offered for income taxes and Using the balance sheet approach,
profit as per the financial there could be additional deferred
statements. tax charge/income on account of
all Ind AS opening balance sheet
adjustments
3. Property, plant and Under Indian GAAP, the Ind AS 16 mandates reviewing the
equipment– Company currently provides method of depreciation, estimated
reviewing depreciation on written down useful life and estimated residual
depreciation and value over the useful lives of the value of an asset at least once in a
residual value assets as per Schedule II of the year. The effect of any change in
Companies Act,2013 the estimated useful and residual
value shall be taken prospectively.

Ind AS 101 allows current

carrying value under Indian
GAAP for items of property, plant
and equipment to be carried
forward as the cost under Ind AS
4. Accounting for Currently, all actuarial gains and Under Ind AS 19, the change in
Employee benefits losses are recognized liability is split into changes arising
immediately in the statement of out of service, interest cost and re
profit and loss. measurements and the change in
asset is split between interest
income and re measurements.

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 Muthoottu Mini Financiers Limited

Treatment as per Indian

[Link]. Particulars Treatment as per Ind AS
GAAP
Changes due to service cost and net
interest cost/ income need to be
recognized in the income statement
and the changes arising out of re-
measurements comprising of
actuarial gains and losses
representing changes in the present
value of the defined benefit
obligation resulting from
experience adjustment and effects
of changes in actuarial assumptions
are to be recognized directly in OCI.

5. Provisions, Under Indian GAAP, provisions Under Ind AS, provisions are
contingent are recognized only under a legal recognised for legal as well as
liabilities and obligation. Also, discounting of constructive obligations. IND AS
contingent assets provisions to present value is not requires discounting the
permitted provisions to present value, if the
effect of time value of money is
material.
6. Presentation and Currently, under Indian GAAP, Ind AS 109 requires all financial
classification of the financial assets and assets and financial liabilities to
Financial financial liabilities are be recognised on initial
Instruments and recognised at the transaction recognition at fair value.
subsequent value. The Company classifies Financial assets have to be either
measurement all its financial assets and classified as measured at
liabilities as short term or long amortized cost or measured at fair
term. value. Where assets are measured
at fair value, gains and losses are
Long term investments are either recognized entirely in profit
carried at cost less any or loss (FVTPL) or recognized in
permanent diminution in the other comprehensive
value of such investments income(FVOCI).
determined on a specific
identification basis. Current Financial assets include equity
investments are carried at lower and debts investments, security
of cost and fair value. receipts, interest free deposits,
loans, trade receivables etc.
Financial liabilities are carried
at their transaction values.
Assets classified at amortized cost
Disclosures under Indian
and FVOCI and the related
GAAP are limited.
revenue (including processing
fees and fees of similar nature) net
Currently under Indian GAAP,
of related costs have to be
loan processing fees and/or fees
measured using the Effective
of similar nature are recognized
Interest Rate (EIR) method.
upfront in the Statement of
Profit and Loss.
Loan processing fees and/or fees
of similar nature would be
measured and recognised using
the Effective Interest Rate (EIR)
method over the period of loan.

There are two measurement

categories for financial liabilities
- FVTPL and amortized cost.
Liabilities classified at amortized

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 Muthoottu Mini Financiers Limited

Treatment as per Indian

[Link]. Particulars Treatment as per Ind AS
GAAP
cost and the related expenses
(processing cost & fees) have to
be measured using the Effective
Interest Rate (EIR) method.

Fair value adjustment on

transition shall be adjusted
against opening retained earnings
on the date of transition.
Disclosures under Ind AS are
extensive.

7. Financial Under Indian GAAP, the The impairment model in Ind AS

Instruments - Company assesses the provision is based on expected credit losses
Impairment for doubtful debts at each and it applies equally to debt
reporting period, which in instruments measured at
practice, is based on relevant amortized cost or FVOCI,
information like past experience, financing receivables, lease
financial position of the debtor, receivables, trade receivables and
cash flows of the debtor, certain written loan commitments
guidelines issued by the regulator and financial guarantee contracts.
etc.
8. Segment Under Indian GAAP there is a Operating segments are identified
Reporting requirement to identify two sets of based on the financial information
segments (business and that is regularly reviewed by the chief
geographical), using a risks and operating decision maker in deciding
rewards approach, with the entity’s how to allocate resources and in
system of internal financial assessing performance.
reporting to key management
personnel serving only as the
starting point for the identification
of such segments
9. Financial Currently there are no detailed Requires disclosure of information
Instruments - disclosure requirements for about the nature and extent of risks
Disclosure financial instruments. However, the arising from financial instruments:
ICAI has issued an Announcement
in December 2005 requiring the • qualitative disclosures about
following disclosures to be made in exposures to each type of risk and
respect of derivative instruments in how those risks are managed; and
the financial statements:
• quantitative disclosures about
• Category-wise quantitative exposures to each type of risk,
data about derivative separately for credit risk, liquidity
instruments that are risk and market risk (including
outstanding at the balance sensitivity analysis).
sheet date;
• The purpose, viz., hedging or
speculation, for which such
derivative instruments have
been acquired; and

• The foreign currency

exposures that are not hedged
by a derivative instrument or
otherwise.

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 Muthoottu Mini Financiers Limited

Treatment as per Indian

[Link]. Particulars Treatment as per Ind AS
GAAP
10. Gain on There is no concept of As per Para 3.2.5 of Ind AS 109,
Derecognition of ‘Derecognition of financial when an entity retains the contractual
Financial Assets assets’ under Indian GAAP rights to receive the cash flows of a
financial asset (the ‘original asset’),
but assumes a contractual obligation
to pay those cash flows to one or more
entities (the ‘eventual recipients’), the
entity treats the transaction as a
transfer of a financial asset if, and
only if, all of the following three
conditions are met.

(a) The entity has no obligation to pay

amounts to the eventual recipients
unless it collects equivalent amounts
from the original asset. Short-term
advances by the entity with the right
of full recovery of the amount lent
plus accrued interest at market rates
do not violate this condition.

(b) The entity is prohibited by the

terms of the transfer contract from
selling or pledging the original asset
other than as security to the eventual
recipients for the obligation to pay
them cash flows.

(c) The entity has an obligation to

remit any cash flows it collects on
behalf of the eventual recipients
without material delay. In addition,
the entity is not entitled to reinvest
such cash flows, except for
investments in cash or cash
equivalents (as defined in Ind AS 7
Statement of Cash Flows) during the
short settlement period from the
collection date to the date of required
remittance to the eventual recipients,
and interest earned on such
investments is passed to the eventual
recipients.

As per Para 3.2.12 on derecognition

of a financial asset in its entirety, the
difference between:
1.(a) the carrying amount (measured
at the date of derecognition) and

2.(b) the consideration received

(including any new asset obtained
less any new liability assumed) shall
be recognised in profit or loss.

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 Muthoottu Mini Financiers Limited

MATERIAL DEVELOPMENTS

Other than as disclosed below, there have been no material developments since March 31, 2020 and there have
arisen no circumstances that materially or adversely affect the operations, or financial condition or profitability of
our Company or the value of its assets or its ability to pay its liabilities within the next 12 months.

1. Raising of fund through issuance of secured, redeemable, non-convertible debentures

(a) Our Company has raised public issue of secured, redeemable, non-convertible debenture amounting to
`19,790.67 lakhs during April 1, 2020 and August 31, 2020.

2. Securitization and Assignment of Gold Loan Portfolio by Direct Assignment Agreement

(a) Our Company, pursuant to an assignment agreement dated October 29, 2019, November 20, 2019 and
December 27, 2019 (“Assignment Agreements”) entered into with the South Indian Bank Limited
(“SIB”), has assigned, on receipt of sanction ` 4,964.00 lakhs, `4,943.00 lakhs and ` 9,910.70 lakhs
respectively, from SIB, against certain identified receivables (gold loan) and other assets, and all other
collateral and underlying security interest created to secure the repayment of each of the facility provided
by our Company to the customers, together with all rights, title, interests and benefits under the facility
agreements and documents entered into between the customers and our Company, free and clear of any
lien or encumbrance, subject to certain terms, as provided under the Assignment Agreements. As on
March 31, 2020, the balance outstanding amount for the assignment agreement dated October 29, 2019
was ` 302.03 lakhs, for assignment agreement dated November 20, 2019 was ` 4,915.49 lakhs, and for
assignment agreement dated December 27, 2019 was ` 9,912.37 lakhs. Further, as on August 31, 2020,
there is no balance outstanding against the assignment agreement dated October 29, 2019, ` 360.53 lakhs
is outstanding against assignment agreement dated November 20, 2019 and ` 7,973.77 lakhs is
outstanding against the assignment agreement dated December 27, 2019.

(b) Our Company, pursuant to an assignment agreement dated May 14, 2020 (“Agreement”) entered into
with the South Indian Bank Limited (“SIB”), has assigned, on receipt of sanction ` 2,845.00 lakhs from
SIB, against certain identified receivables (gold loan) and other assets, and all other collateral and
underlying security interest created to secure the repayment of each of the facility provided by our
Company to the customers, together with all rights, title, interests and benefits under the facility
agreements and documents entered into between the customers and our Company, free and clear of any
lien or encumbrance, subject to certain terms, as provided under the Agreement. As on August 31, 2020,
the outstanding balance is ` 1,291.18 lakhs.

3. The Board of Directors in their meeting dated April 20, 2020 approved the issuance of subordinated debt by
our Company upto an amount of ` 10,000 lakhs during the Financial Year 2020-21. During the period April
1, 2020 to August 31, 2020, our Company has raised funds through subordinated debt amounting to ` 2,772.88
lakhs and may continue to raise subordinated debts not exceeding ` 7,227.12 lakhs during the Financial Year
2020-21.

4. Our Company, pursuant to sanction letter dated May 25, 2020 has availed an overdraft facility of ` 100.00
lakhs from HDFC Bank for working capital purpose. The overdraft facility is secured by way of fixed deposit
of the same amount.

5. Redemption of non-convertible debentures:

(a) Our company, during the period between April 1, 2020 to August 31, 2020 has redeemed secured
privately placed non-convertible debentures amounting to ` 237.00 lakhs and unsecured privately placed
non-convertible debentures amounting to ` 245.00 lakhs.

(b) Our company, during the period between April 1, 2020 to August 31, 2020 has redeemed secured public
issue of non-convertible debenture amounting to ₹ 4,289.79 lakhs and unsecured public issue of non-
convertible debentures amounting to ` 7,143.37 lakhs.

124
 Muthoottu Mini Financiers Limited

6. Pass through Certificate Transactions:

(a) Our Company has entered into a Pass through Certificate Transaction with Development Credit Bank on
January 21, 2020 for securitization of its loan receivables arising from the pool of loans provided to
various persons from time to time (“Receivables”) through Northern Arc 2019 GL Aurum (“Trust”),
acting thorough the trustee Catalyst Trusteeship Limited. Our Company as per the agreed terms and
conditions has assigned Receivables to the Trust vide its assignment agreement dated January 21, 2020
along with corresponding rights, titles and interests to and in favour of the Trust for a consideration of `
5,158.90 lakhs. Our Company has received the said amount on January 21, 2020. As on March 31, 2020,
the balance outstanding amount was ` 3,510.80 lakhs (excluding interest receivable). As on August 31,
2020 the Company has repaid the same in entirety.

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 Muthoottu Mini Financiers Limited

FINANCIAL INDEBTEDNESS

As on June 30, 2020, the Company had outstanding secured borrowing of `86,372.68 lakhs (including PTC
transaction of `1,661.98 lakhs) and unsecured borrowing of `35,269.60 lakhs. A summary of all the outstanding
secured and unsecured borrowings together with a brief description of certain significant terms of such financing
arrangements are as under

Secured Loan Facilities

Amount
Amount
sanctione
outstand
Name of the lender d (in
ing as on Repayment
and details of `lakhs) Security
June 30, date/schedule
documentation and
2020 (in
details of
`lakhs)#
facility
The South Indian 16,500.00 13,537.5 First ranking pari passu charge Validity of limit is 12
Bank Limited 4 along with existing secured lenders months
of the Company on all receivables
Cash Credit Open under gold loan both present and
Loan-Working capital future of the Company with 15%
margin and equitable mortgage of
Sanction letter dated immovable properties being land
July 2, 2019 admeasuring 159.95 acres and ½
undivided share in Chengamanad
village and land admeasuring 65.98
acres in Chengamanad village.

Personal guarantee of Roy M.

Mathew; Nizzy Mathew; and
Mathew Muthoottu

Corporate guarantee of:

1. Muthoottu Mini Theatres Private

Limited;
2. Muthoottu Mini Hotels Private
Limited;
3. Mini Muthoottu Credit India
Private Limited; and
4. Kandamath Cine Enterprises
Dhanalaxmi Bank 2,400.00 1,421.79 Pari-passu charge by way of On demand
Limited hypothecation of current assets,
loans, advances and book debts
Cash Credit and including gold loan receivable, with
working capital a margin of 25%
demand loan
Collateral security: Equitable
Sanction letter dated mortgage of 34.39 acres of vacant
December 27, 2019 land at Pathanamthitta village,
Kozhencherry Taluk,
Pathanamthitta District in the name
of Muthoottu Mini Theatres
(Private) Limited valued at `7.22
crores (MV) and `6 crores (DSV) as
per EVR dated February 16, 2016

126
 Muthoottu Mini Financiers Limited

Amount
Amount
sanctione
outstand
Name of the lender d (in
ing as on Repayment
and details of `lakhs) Security
June 30, date/schedule
documentation and
2020 (in
details of
`lakhs)#
facility
Personal guarantee of Roy M.
Mathew; Nizzy Mathew and
Mathew Muthoottu

Corporate guarantee of Muthoottu

Mini Theatres Private Limited
State Bank of India 5,000.00 2,879.91 First charge on current assets of the On demand
Company on pari passu basis with
Cash credit other lenders in MBA and non-
convertible holders 25% margin to
Sanction letter dated be maintained
April 15, 2020
Equitable mortgage of 32.86 acres of
land regarding serial number 219/2,
block number 13 in Maradu village,
in the name of Muthoottu Mini
Theatres Private Limited

Personal guarantee of Roy M.

Mathew, Mathew Muthoottu and
Nizzy Mathew

Corporate guarantee of Muthoottu

Mini Theatres Private Limited
Union Bank of India 7,500.00 4,126.70 Pari passu first charge by way of On demand
(erstwhile Andhra hypothecation of gold loan
Bank) receivables of the Company
(excluding microfinance
Open Cash Credit receivables) for the loans disbursed
by them to individuals against
Sanction letter dated pledge of gold ornaments with
June 24, 2020* minimum asset coverage of
133.33%

Pari passu first charge on other

current assets including cash and
bank balances (excluding cash
collateral specifically given to each
bank and cash of microfinance
division)

Collateral security: (a) 16.17 ares

(40 cents) of land in survey number
33/3/1, 33/3/1-1, 33/3/1-2, 33/3/1/3
and 33/3/1/4 situated at
Pathanamthitta village, Kerala, and
(b) pledge of KTD no.
01252010077984 in the name of
Muthoottu Mini Financiers Limited

Personal guarantee: Nizzy Mathew

and Mathew Muthoottu

127
 Muthoottu Mini Financiers Limited

Amount
Amount
sanctione
outstand
Name of the lender d (in
ing as on Repayment
and details of `lakhs) Security
June 30, date/schedule
documentation and
2020 (in
details of
`lakhs)#
facility

Corporate guarantee: Muthoottu

Mini Hotels Private Limited
Punjab National 5,000.00 4,001.25 Pari passu first charge by way of On demand
Bank (erstwhile hypothecation of Gold Loan
Oriental Bank of receivables of the Company with
Commerce) minimum asset coverage of 1.33
times
Cash Credit
Collateral security:
Sanction letter dated Equitable/Registered Mortgage of
February 2, 2020 immovable property multiplex
theatre Dhanya & Remya, situated at
Survey No. 34, M. C. Road,
Kottayam, Kerala

Personal guarantee: Nizzy Mathew

and Mathew Muthoottu
IndusInd Bank 5,000.00 4,920.42 First pari-passu charge on On demand
receivables including gold loan
Cash Credit receivables with banks under MBA
and non-convertible debenture
Sanction letter dated holders
April 27, 2020
Collateral security of:

(a) 05.85 ares along with a three

storied building comprises in re-
survey number 83 in block
number 179 of Kollam East
Village, Kollam Taluk;
(b) 09.250 cents (03.74 Ares)
situated at Survey No. 2786/C-
1, 2786/C-2-1 at Vanchiyoor,
Trivandrum along with building
bearing T.C. nos. 26/44 and 45;
and
(c) Property having an extent of 19
cents (07.69 acres) and all other
things attached thereto
comprised in old [Link].290/3
(re-sy no 170/2-1) of Pandalam
Village, Adoor Taluk
Union Bank of India 2,500.00 2,421.92 Pari passu charge on gold On demand
receivables and other current assets.
Cash Credit
Personal guarantee of Mathew
Sanction letter dated Muthoottu, Roy Mathew and Nizzy
June 24, 2020* Mathew
HDFC Bank 100.00 (5.89) Primary security for fixed deposit of On demand
` 100 lakhs

128
 Muthoottu Mini Financiers Limited

Amount
Amount
sanctione
outstand
Name of the lender d (in
ing as on Repayment
and details of `lakhs) Security
June 30, date/schedule
documentation and
2020 (in
details of
`lakhs)#
facility
Overdraft against
fixed deposit

Sanction letter dated

May 25, 2020
State Bank of India 80.00 71.93 Hypothecation by way of first and Repayable in not
exclusive charge on the vehicle for exceeding 84 monthly
Vehicle Loan (BMW- the due payment instalments
X5)

Agreement of loan-
cum-hypothecation
dated September 19,
2019
Dhanalaxmi Bank 500.00 225.00 Pari-passu charge by way of `41.50 lakhs per
Limited hypothecation of current assets, month for 11 months
loans, advances and book debts and `43.50 lakhs per
Short Term loan including gold loan receivable, with month for 12th month
a margin of 25% margin with other after initial
Sanction letter dated lenders and NCD holders. moratorium for
December 12, 2019 principal payment for
Collateral security: Equitable 3 months. Interest to
mortgage of 34.39 acres of vacant be cleared separately
land at Pathanamthitta village, as and when debited.
Kozhencherry Taluk,
Pathanamthitta District in the name
of Muthoottu Mini Theatres
(Private) Limited and Commercial
Land with building to the extent of
2.40 Ares Land with 4500 [Link]
Building owned by Muthoot Hotels
Pvt Limited at Konni Village,
Konni Taluk, Pathanamthitta
District.

Personal guarantee of Roy M.

Mathew; Nizzy Mathew and
Mathew Muthoottu

Corporate guarantee of Muthoottu

Mini Theatres Private Limited and
Muthoot Mini Hotels Private
Limited.
Total 33,600.57
#
The above-mentioned amounts are inclusive of the interest component as on that date.
*Reaffirmed on July 3, 2020

Restrictive Covenants

Many of the financing agreements include various restrictive conditions and covenants restricting certain
corporate actions, and the Company is required to take the prior approval of the lender before carrying out such

129
 Muthoottu Mini Financiers Limited

activities. For instance, the Company, inter alia, is required to obtain the prior written consent in the following
instances:

• to declare and/or pay dividend to any of its Shareholders whether equity or preference, during any financial
year unless the Company has paid to the lender the dues payable by the Company in that year;

• to undertake or permit any merger, amalgamation or compromise with its Shareholders, creditors or effect
any scheme of amalgamation or reconstruction or disposal of whole of the undertaking

• to create or permit any charges or lien, sell or dispose of any encumbered assets;

• to alter its capital structure, or otherwise acquire any share capital;

• to effect a change of ownership or control, or management of the Company;

• to enter into long term contractual obligations directly affecting the financial position of the Company;

• to borrow or obtain credit facilities from any bank or financial institution;

• to undertake any guarantee obligations on behalf of any other company; and

• sell, assign, mortgage or otherwise dispose of any of the fixed assets charged to the banks.

Pass through Certificate Transaction

Our Company has entered into a Pass through Certificate Transaction with Development Credit Bank on January
21, 2020 for securitization of its loan receivables arising from the pool of loans provided to various persons from
time to time (“Receivables”) through Northern Arc 2019 GL Aurum (“Trust”), acting thorough the trustee
Catalyst Trusteeship Limited.

Our Company as per the agreed terms and conditions has assigned Receivables to the Trust vide its assignment
agreement dated January 21, 2020 along with corresponding rights, titles and interests to and in favour of the Trust
for a consideration of `5,158.90 lakhs. Our Company has received the said amount on January 21, 2020. As on
June 30, 2020, the total amount outstanding is `1,661.98 lakhs. For further details, see “History and Certain Other
Corporate Matters” on page 105.

Secured Non-Convertible Debentures

The details of the secured non-convertible debentures issued by the Company, outstanding as on June 30, 2020 is
provided below:

1. Private placement of secured redeemable non-convertible debentures

The Company has issued, on private placement basis, secured redeemable non-convertible debentures under
various series of which `3,055.87lakhs was cumulatively outstanding as on June 30, 2020, the details of which
are set forth below:

Principal
Amount
Debenture Date of Coupon outstanding Redemption Credit
Tenure Security
Series Allotment (in %) as on June Date Rating
30, 2020
(in `lakhs)
XVIII March 13, 8.75 to 3,055.87 400 days Various Secured pari passu N.A.
2015 – 18.18 to charge on current
November 5.5years assets including book
18, 2019 debts, loans and
advances, cash and
bank balances and

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Principal
Amount
Debenture Date of Coupon outstanding Redemption Credit
Tenure Security
Series Allotment (in %) as on June Date Rating
30, 2020
(in `lakhs)
receivables both
present and future of
the company with the
secured lender

2. Public issue of secured redeemable non-convertible debentures

(a) Public Issue 5

The Company vide an initial public offer, issued secured redeemable non-convertible debentures of
which `5,585.97lakhs was outstanding as on June 30, 2020, the details of which are set forth below:

Principal
Total
Amount
Redem issue size
Nature of Coupo outstandin Date of
Tenur ption (principal Credit
debenture n g as on allotmen Security
e Date/sc amount) rating
s (in %) June 30, t
hedule (in
2020
`lakhs)
(in `lakhs)
Secured 72 11.00 to 5,585.97 August August 22,827.12 Secured by way of first pari CARE:
redeemabl months 12.25 25, 2015 25, passu charge on immovable BBB-
e non- 2021 property located at house of Outlook:
convertible Hiranandhini, no. 5/63, Old Stable
debentures Mahabalipuram Road,
Egathur Village, Chennai -
600130 and first charge on
current assets including
book debts, loans and
advances, cash and bank
balances and receivables
both present and future
except those receivables
specifically and exclusively
charged in favour of the
existing lenders ranking
pari passu with the existing
secured debenture holders

(b) Public Issue 7

The Company vide an initial public offer, issued secured redeemable non-convertible debentures of
which `11,671.79 lakhs was outstanding as on June 30, 2020, the details of which are set forth below:

Principal Total
Amount issue size
Nature of Coupon outstanding Date of Redemption (principal Credit
Tenure Security
debentures (in %) as on June allotment Date/schedule amount) rating
30, 2020 (in
(in `lakhs) `lakhs)
Secured 480 9.25 to 11,671.79 April 24, August 17, 11,671.79 First ranking pari- IND-
redeemable days to 10.47 2019 2020 to April passu charges BBB-:
non- 60 24, 2024 with existing Stable
months secured creditors, Outlook

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Principal Total
Amount issue size
Nature of Coupon outstanding Date of Redemption (principal Credit
Tenure Security
debentures (in %) as on June allotment Date/schedule amount) rating
30, 2020 (in
(in `lakhs) `lakhs)
convertible on current assets
debentures including book
debts, loans and
advances, cash
and bank balances
(not including
reserves created
in accordance
with law) and
receivables both
present and future
of the Company

(c) Public Issue 8

The Company vide an initial public offer, issued secured redeemable non-convertible debentures of
which `13,203.38lakhs was outstanding as on June 30, 2020, the details of which are set forth below:

Principal Total
Amount issue size
Nature of Coupon outstanding Date of Redemption (principal Credit
Tenure Security
debentures (in %) as on June allotment Date/schedule amount) rating
30, 2020 (in
(in `lakhs) `lakhs)
Secured 480 9.89 to 13,203.38 September January 1, 13,203.38 First ranking pari CARE-
redeemable days to 10.65 12, 2019 2021 to passu charges BBB-
non- 60 September 9, with existing :Stable
convertible months 2024 secured creditors, Outlook
debentures on current assets
including book
debts, loans and
advances, cash
and bank
balances (not
including
reserves created
in accordance
with law) and
receivables both
present and
future of the
Company

(d) Public Issue 9

The Company vide an initial public offer, issued secured redeemable non-convertible debentures of
which `17,593.14lakhs was outstanding as on June 30, 2020, the details of which are set forth below:

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Principal Total
Amount issue size
Nature of Coupon outstanding Date of Redemption (principal Credit
Tenure Security
debentures (in %) as on June allotment Date/schedule amount) rating
30, 2020 (in
(in `lakhs) `lakhs)
Secured 480 9.40 to 17,593.14 February June 11, 2021 17,593.14 First ranking pari CARE-
redeemable days to 10.50 18, 2020 to March 17, passu charges BBB-
non- 85 2027 with existing :Stable
convertible months secured Outlook
debentures creditors, on
current assets
including book
debts, loans and
advances, cash
and bank
balances (not
including
reserves created
in accordance
with law) and
receivables both
present and
future of the
Company

Unsecured Non-Convertible Debentures

The details of the unsecured non-convertible debentures issued by the Company, outstanding as on June 30, 2020
is provided below:

1. Private placement of unsecured redeemable non-convertible debentures

The Company has issued, on private placement basis, unsecured redeemable non-convertible debentures
under various series of which `794.75 lakhs was cumulatively outstanding as on June 30, 2020, the details of
which are set forth below:

Principal Amount
Date of outstanding as on
Coupon Redemption Credit
Debenture series Tenure
allotment June 30, 2020
(in %) Date/schedule rating
(in `lakhs)
Unsecured June 2013 to 10.75 to 794.75 400 days December 2020 to NA
redeemable non- January2020 24.77 to 100 November 2021
convertible months
debenture

2. Public issue of unsecured redeemable non-convertible debentures

(a) Public Issue 4

The Company vide an initial public offer, issued unsecured redeemable non-convertible debentures of
which `6,849.15lakhswas outstanding as on June 30, 2020, the details of which are set forth below:

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Principal
Total issue
Amount
Debenture Date of Coupon Redemption size (Principal Credit
outstanding as Tenure
Series Allotment (in %) Date amount) (in Rating
on June 30, 2020
`Lakhs)
(in `lakhs)
Unsecured April 7, 12.00 to 6,849.15 68 December 7, 6,849.15 IND-
redeemable non- 2015 13.01 months 2020 BBB-:
convertible Stable
debentures Outlook

(b) Public Issue 6

The Company vide an initial public offer, issued unsecured redeemable non-convertible debentures of
which `4,400.75lakhs was outstanding as on June 30, 2020, the details of which are set forth below:

Principal
Total Issue
amount
Debenture Date of Coupon Redemption Size (principal Credit
outstanding as Tenure
Series Allotment (in %) Date amount) (in Rating
on June 30, 2020
`lakhs)
(in `lakhs)
Unsecured January 27, 10.50 to 4,400.75 78 July 27, 2022 4,400.75 IND-BBB-:
redeemable non- 2016 11.25 months Stable
convertible Outlook
debentures

3. Sub-ordinated debt

Subordinated debt is subordinated to the claims of other creditors and qualifies as Tier II Capital subject to
discounting as may be applicable under the Systemically Important NBFC (Non-deposit Accepting or
holding) Companies Prudential Norms (Reserve Bank) Directions, 2015. The outstanding amount of privately
placed subordinated debt was `23,224.95 lakhs as on June 30, 2020, the details of which are set forth below:

Principal
Total issue
amount
Debenture Date of Coupon Redemption size (Principal Credit
outstanding as Tenure
Series Allotment (in %) Date amount) (in Rating
on June 30, 2020
`Lakhs)
(in `lakhs)
Subordinated January 10.5 to 23,224.95 61- 84 January 2022 23,224.95 NA
debt 2016 to June 16.67 months to July 2027
2020

Commercial Papers

The Company has not issued any commercial papers.

Loan from Directors and Relatives of Directors

The Company has not taken any loan from Directors or relative of Directors.

Inter Corporate Loans

The Company has not borrowed any amount in the nature of demand loans from companies under same
management.

Servicing behaviour on existing debt securities, payment of interest on due dates on financing facilities or
securities

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The Company has not defaulted upon or delayed in payment of any interest and/or principal for the existing term
loan, the non-convertible debentures and other financial indebtedness. The Company has not issued any corporate
guarantee.

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SECTION VI – ISSUE RELATED INFORMATION

ISSUE STRUCTURE

Public Issue of NCDs aggregating up to `10,000 lakhs, with an option to retain over-subscription up to `10,000
lakhs, aggregating up to `20,000 lakhs, on the terms and in the manner set forth herein.

At the meeting of the Board of Directors of our Company held on July 20, 2020, the Directors approved the issue
of NCDs to the public up to an amount not exceeding `40,000 lakhs for the financial year 2020-2021.

This Issue for an amount not exceeding `20,000 lakhs has been approved by the Debenture Committee in its
meeting dated July 20, 2020.

Principal Terms and Conditions of the Issue

TERMS AND CONDITIONS IN CONNECTION WITH THE NCDs

Issuer Muthoottu Mini Financiers Limited

Lead Manager Vivro Financial Services Private Limited
Debenture Trustee Vistra ITCL (India) Limited
Registrar to the Issue Link Intime India Private Limited
Type and nature of Secured, redeemable, non-convertible debentures
Instrument
Face Value of NCDs `1,000
(`/NCD)
Issue Price (`/NCD) `1,000
Minimum Application 10 NCDs i.e., `10,000 (across all Options of NCDs)
In Multiples of One NCD after the minimum Application
Seniority Senior (the claims of the Debenture Holders holding NCDs shall be superior to
the claims of any unsecured creditors, subject to applicable statutory and/or
regulatory requirements).

The NCDs would constitute secured obligations of our Company and shall have
first ranking pari passu charge with the Existing Secured Creditors on all
movable assets, including book debts and receivables, cash and bank balances,
loans and advances, both present and future of our Company equal to the value
one time of the debentures outstanding plus interest accrued thereon
Mode of Issue Public Issue
Mode of Allotment In dematerialised form
Mode of Trading NCDs will be traded in dematerialised form
Minimum Subscription Minimum subscription is 75% of the Base Issue, i.e. `7,500 lakhs
Issue Public issue by our Company of NCDs aggregating up to `10,000 lakhs, with
an option to retain over-subscription up to `10,000 lakhs, aggregating up to
`20,000 lakhs, on the terms and in the manner set forth herein
Base Issue `10,000 lakhs
Stock Exchange BSE Limited
proposed for listing of the
NCDs
Listing and timeline for The NCDs shall be listed within 6 Working Days of Issue Closure
Listing
Depositories NSDL and CDSL
Security The principal amount of the NCDs to be issued in terms of this Prospectus
together with all interest due on the NCDs, as well as all costs, charges, all fees,
remuneration of Debenture Trustee and expenses payable in respect thereof shall

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be secured by way of first ranking pari passu charge with Existing Secured
Creditors, on current assets, including book debts, loans and advances, cash and
bank balances (not including reserves created in accordance with law) and
receivables, both present and future of the Company
Security Cover Our Company shall maintain a minimum 100% security cover on the
outstanding balance of the NCDs plus accrued interest thereon
Who can apply * Category I

• Resident public financial institutions as defined in Section 2(72) of the

Companies Act 2013, statutory corporations including state industrial
development corporations, scheduled commercial banks, co-operative
banks and regional rural banks, and multilateral and bilateral development
financial institutions which are authorised to invest in the NCDs;
• Provident funds of minimum corpus of `2,500 lakhs, pension funds of
minimum corpus of `2,500 lakhs, superannuation funds and gratuity fund,
which are authorised to invest in the NCDs;
• Alternative investment funds, subject to investment conditions applicable
to them under the Securities and Exchange Board of India (Alternative
Investment Funds) Regulations, 2012;
• Resident venture capital funds registered with SEBI;
• Insurance Companies registered with the IRDAI;
• National Investment Fund (set up by resolution no. F. No. 2/3/2005-DDII
dated November 23, 2005 of the Government of India and published in the
Gazette of India);
• Insurance funds set up and managed by the Indian army, navy or the air
force of the Union of India or by the Department of Posts, India;
• Mutual Funds registered with SEBI; and
• Systemically Important NBFCs.

Category II

• Companies falling within the meaning of Section 2(20) of the Companies

Act 2013; bodies corporate and societies registered under the applicable
laws in India and authorised to invest in the NCDs;
• Educational institutions and associations of persons and/or bodies
established pursuant to or registered under any central or state statutory
enactment; which are authorised to invest in the NCDs;
• Trust including public/private charitable/religious trusts which are
authorised to invest in the NCDs;
• Association of persons;
• Scientific and/or industrial research organisations, which are authorised to
invest in the NCDs;
• Partnership firms in the name of the partners;
• Limited liability partnerships formed and registered under the provisions of
the Limited Liability Partnership Act, 2008 (No. 6 of 2009); and
• Resident Indian individuals and Hindu undivided families through the Karta
aggregating to a value exceeding `5 lakhs.

Category III*

• Resident Indian individuals; and

• Hindu undivided families through the Karta.
* applications aggregating to a value not more than `5 lakhs
Credit Rating Date of
Amount
Rating Rating credit Rating
Instrument rated (in
agency symbol rating Definition
` lakhs)
letter

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 Muthoottu Mini Financiers Limited

India Non- IND August 14, 40,000 Instruments

Ratings convertible BBB’ : 2020 with this
and debentures Outlook rating are
Research Stable considered to
Private have moderate
Limited degree of
safety
regarding
timely
servicing of
financial
obligations.
Such
instruments
carry
moderate
credit risk.
Issue Size Public issue by our Company of NCDs aggregating up to `10,000 lakhs, with
an option to retain over-subscription up to `10,000 lakhs, aggregating up to
`20,000 lakhs
Pay-in date Application Date. The entire Application Amount is payable on Application
Application money The entire Application Amount is payable on submitting the Application
Mode of payment Please see “Issue Procedure” on page 157
Record Date The record date for payment of interest in connection with the NCDs or
repayment of principal in connection therewith shall be 7 Working Days prior
to the date on which interest is due and payable, and/or the date of redemption.
Provided that trading in the NCDs shall remain suspended between the
aforementioned Record Date in connection with redemption of NCDs and the
date of redemption or as prescribed by the Stock Exchange, as the case may be.

In case Record Date falls on a day when Stock Exchange is having a trading
holiday, the immediate subsequent trading day will be deemed as the Record
Date
Issue Schedule The Issue shall be open from September 9, 2020 to October 6, 2020 with an
option to close earlier as may be determined by a duly authorised committee of
the Board and informed by way of newspaper publication on or prior to the
earlier closer date/date of closure up to maximum 30 days from the date of the
Prospectus.
Objects of the Issue Please refer to the chapter titled “Objects of the Issue” on page 61
Put/Call Option None
Details of the utilisation Please refer to the chapter titled “Objects of the Issue” on page 61
of the proceeds of the
Issue
Coupon rate and Please refer to the chapter titled “Terms of Issue” on page 143
redemption premium
Working Days convention If the date of payment of interest does not fall on a Working Day, then the
interest payment will be made on succeeding Working Day, however the
calculation for payment of interest will be only till the originally stipulated
Interest Payment Date. The dates of the future interest payments would be as
per the originally stipulated schedule. In case the redemption date (also being
the last interest payment date) does not fall on a Working Day, the payment will
be made on the immediately preceding Working Day, along with
coupon/interest accrued on the NCDs until but excluding the date of such
payment
Issue Closing Date October 6, 2020

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Issue Opening Date September 9, 2020

Default interest date In the event of any default in fulfilment of obligations by our Company under
the Debenture Trust Deed, the Default Interest Rate payable to the Applicant
shall be as prescribed under the Debenture Trust Deed
Deemed Date of The date on which the Board or the Debenture Committee approves the
Allotment Allotment of NCDs. All benefits relating to the NCDs including interest on
NCDs shall be available to Investors from the Deemed Date of Allotment. The
actual allotment of NCDs may take place on a date other than the Deemed Date
of Allotment
Day count basis Actual
Redemption Amount The principal amount of the NCDs along with interest accrued on them, if any,
as on the Redemption Date
Redemption premium/ Not applicable
discount
Transaction documents The Draft Prospectus and this Prospectus read with any notices, corrigenda,
addenda thereto, the Debenture Trusteeship Agreement, the Debenture Trust
Deed and other security documents, if applicable, and various other
documents/agreements/undertakings, entered or to be entered by the Company
with Lead Manager and/or other intermediaries for the purpose of this Issue
including but not limited to the Public Issue Account Agreement, the Agreement
with the Registrar and the Agreement with the Lead Manager. Refer to section
titled “Material Contracts and Documents for Inspection” on page 237
Affirmative and Negative The covenants precedent and subsequent to the Issue will be finalised upon
covenants precedent and execution of the Debenture Trust Deed which shall be executed within three
subsequent to the Issue months of closure of the Issue as per Regulation 15 of SEBI Debt Regulations.
Further, in the event our Company fails to execute the Debenture Trust Deed
within a period of three months from the Issue Closing Date, our Company shall
pay interest of at least 2% p.a. to each NCD Holder, over and above the agreed
coupon rate, till the execution of the Debenture Trust Deed
Events of default Please refer to the chapter titled “Terms of Issue – Events of Default” on page
145
Cross Default Please refer to the chapter titled “Terms of Issue – Events of Default” on page
145
Roles and responsibilities Please refer to the chapter titled “Terms of Issue – Debenture Trustees for the
of the Debenture Trustee Debenture Holders” on page 145
Settlement Mode Please refer to the chapter titled “Terms of Issue - Payment on Redemption” on
page 153
Governing law and The Issue shall be governed in accordance with the laws of the Republic of India
jurisdiction and shall be subject to the exclusive jurisdiction of the courts of Kochi
Note: (a) The Issue shall remain open for subscription on Working Days from 10:00 a.m. to 5:00 p.m. (Indian
Standard Time), during the period indicated above, except that the Issue may close on such earlier date or extended
date (subject to a period of maximum 30 days from the date of Prospectus) as may be decided by the Board of
Directors of our Company (“Board”) or the Debenture Committee. In the event of such an early closure of or
extension subscription list of the Issue, our Company shall ensure that notice of such early closure or extension is
given to the prospective investors through an advertisement in a national daily newspaper with wide circulation on
or before such earlier date or extended date of closure. Applications Forms for the Issue will be accepted only from
10:00 a.m. to 5:00 p.m. (Indian Standard Time) or such extended time as may be permitted by BSE, on Working
Days during the Issue Period. On the Issue Closing Date, Application Forms will be accepted only between 10:00
a.m. to 3:00 p.m. and uploaded until 5:00 p.m. (Indian Standard Time) or such extended time as may be permitted
by BSE.
(b) In terms of Regulation 4(2)(d) of the SEBI Debt Regulations, our Company will undertake this Issue of NCDs in
dematerialized form. However, in terms of Section 8 (1) of the Depositories Act, the Company, at the request of the
Applicants who wish to hold the NCDs post allotment in physical form, will fulfil such request through the process
of dematerialization, if the NCDs were originally issued in dematerialized form.

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*
Participation by any of the above-mentioned Investor classes in this Issue will be subject to applicable statutory
and/or regulatory requirements. Applicants are advised to ensure that Applications made by them do not exceed the
investment limits or maximum number of NCDs that can be held by them under applicable statutory and/or
regulatory provisions.

In case of Application Form being submitted in joint names, the Applicants should ensure that the demat account
is also held in the same joint names and the names are in the same sequence in which they appear in the Application
Form.

Applicants are advised to ensure that they have obtained the necessary statutory and/or regulatory
permissions/consents/approvals in connection with applying for, subscribing to, or seeking allotment of
NCDs pursuant to the Issue.

For further details, please refer to “Issue Procedure” on page 157.

Terms of the NCDs

50 60
Tenure 480 Days 24 months 24 months 36 months 85 months
months months
Nature Secured
Options I II III IV V VI VII
Frequency of
Interest Monthly Monthly Cumulative Monthly Cumulative Monthly Cumulative
Payment
Minimum
10 NCDs (`10,000) (across all options of NCDs)
Application
In multiples,
1 NCD after the minimum application
of
Face Value
of NCDs `1,000
(`/NCD)
Issue Price
`1,000
(`/NCD)
Mode of
Interest
Through various options available
Payment/
Redemption
Coupon (%)
per annum
9.50% 9.75% NA 10.00% NA 10.50% NA
in Category
I, II and III
Coupon
Fixed
Type
Redemption
Amount
(`/NCD) for
NCD 1,000 1,000 1,205 1,000 1,500 1,000 2,000
Holders in
Category I,
II and III
Effective
Yield (%)
(per annum) 9.92% 10.20% 9.77% 10.47% 10.22% 11.02% 10.28%
– Category I,
II and III
Put and Call
Not Applicable
Option
Deemed The date on which the Board or a duly authorised committee approves the Allotment of NCDs. All benefits relating to
Date of the NCDs including interest on the NCDs shall be available to the investors from the Deemed Date of Allotment. The
Allotment actual Allotment of NCDs may take place on a date other than the Deemed Date of Allotment.

Interest and Payment of Interest

1. Monthly interest payment options

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Interest would be paid monthly under Options I, II, IV and VI at the following rates of interest in connection with
the relevant categories of Debenture holders, on the amount outstanding from time to time, commencing from the
Deemed Date of Allotment of NCDs:

Rate of Interest (p.a.) for the following tenures

Category of NCD Holder Option I Option II Option IV Option VI
480 Days 24 months 36 months 60 months
All categories 9.50% 9.75% 10.00% 10.50%

For avoidance of doubt where interest is to be paid on a monthly basis, relevant interest will be calculated from
the first day till the last date of every month on an actual/actual basis during the tenor of such NCDs, and paid on
the first day of every subsequent month. For the first interest payment for NCDs under the monthly options if the
Deemed Date of Allotment is prior to the fifteenth of that month, interest for that month will be paid on first day
of the subsequent month and if the Deemed Date of Allotment is post the fifteenth of that month, interest from the
Deemed Date of Allotment till the last day of the subsequent month will be clubbed and paid on the first day of
the month next to that subsequent month.

2. Cumulative interest payment options

Option III, V and VII of the NCDs shall be redeemed as below:

Redemption Amount (per NCD)

Category of NCD Holder Option III Option V Option VII
24 months 50 months 85 months
All categories 1,205 1,500 2,000

Day count convention

Please refer to Annexure I for details pertaining to the cash flows of the Company in accordance with the SEBI
circular bearing number CIR/IMD/DF/18/2013 dated October 29, 2013 and SEBI Circular No. CIR/IMD/DF-
1/122/2016 dated November 11, 2016.

Please note that in case the NCDs are transferred and/or transmitted in accordance with the provisions of this
Prospectus read with the provisions of the Articles of Association of our Company, the transferee of such NCDs
or the transferee of deceased holder of NCDs, as the case may be, shall be entitled to any interest which may have
accrued on the NCDs subject to such Transferee holding the NCDs on the Record Date.

Terms of Payment

The entire face value per NCDs is payable on Application. The entire amount of face value of NCDs applied for
will be blocked in the relevant ASBA Account maintained with the SCSB. In the event of Allotment of a lesser
number of NCDs than applied for, our Company shall unblock the additional amount blocked upon application in
the ASBA Account, in accordance with the terms of specified in “Terms of Issue – Manner of Payment of Interest
/ Redemption Amounts” on page 151.

Participation by any of the above-mentioned Investor classes in this Issue will be subject to applicable
statutory and/or regulatory requirements. Applicants are advised to ensure that Applications made by
them do not exceed the investment limits or maximum number of NCDs that can be held by them under
applicable statutory and/or regulatory provisions.

Applications may be made in single or joint names (not exceeding three). Applications should be made by Karta
in case the Applicant is an HUF. If the Application is submitted in joint names, the Application Form should
contain only the name of the first Applicant whose name should also appear as the first holder of the depository
account held in joint names. If the depository account is held in joint names, the Application Form should contain
the name and PAN of the person whose name appears first in the depository account and signature of only this
person would be required in the Application Form. This Applicant would be deemed to have signed on behalf of
joint holders and would be required to give confirmation to this effect in the Application Form. Please ensure that
such Applications contain the PAN of the HUF and not of the Karta.

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 Muthoottu Mini Financiers Limited

In the case of joint Applications, all payments will be made out in favour of the first Applicant. All communications
will be addressed to the first named Applicant whose name appears in the Application Form and at the address
mentioned therein.

Applicants are advised to ensure that they have obtained the necessary statutory and/or regulatory
permissions/consents/approvals in connection with applying for, subscribing to, or seeking Allotment of
NCDs pursuant to this Issue. For further details, please see the chapter titled “Issue Procedure” on page 157.

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TERMS OF THE ISSUE

Authority for the Issue

At the meeting of the Board of Directors of our Company held on July 20, 2020, the Directors approved the issue
of NCDs to the public up to an amount not exceeding `40,000 lakhs for the financial year 2020-2021. This Issue
for an amount not exceeding `20,000 lakhs has been approved by the Debenture Committee in its meeting dated
July 20, 2020. Further, the present borrowing is within the borrowing limits under Section 180(1)(c) of the
Companies Act, 2013, duly approved by the Shareholders’ vide their resolution passed at their EGM held on
December 10, 2013.

Principal Terms & Conditions of this Issue

The NCDs being offered as part of the Issue are subject to the provisions of the SEBI Debt Regulations, the
Companies Act, 2013, the Memorandum and Articles of Association of our Company, the terms of this Prospectus,
the Application Forms, the terms and conditions of the Debenture Trusteeship Agreement, the Debenture Trust
Deed, other applicable statutory and/or regulatory requirements including those issued from time to time by SEBI,
the Government of India, BSE, RBI, and/or other statutory/regulatory authorities relating to the offer, issue and
listing of securities and any other documents that may be executed in connection with the NCDs.

Ranking of NCDs

The NCDs being offered through this Issue would constitute direct and secured obligations of the Company and
shall rank pari passu charge inter se, and subject to any obligations under applicable statutory and/or regulatory
requirements, shall also, with regard to the amount invested, be secured by way of first charge on the identified
movable assets of our Company. The claims of the Debenture Holders shall be superior to the claims of any
unsecured creditors, subject to applicable statutory and/or regulatory requirements.

Security

The Issue comprises of public issue of NCDs of face value of `1,000 each.

The principal amount of the NCDs to be issued in terms of this Prospectus together with all interest due on the
NCDs, as well as all costs, charges, all fees, remuneration of Debenture Trustee and expenses payable in respect
thereof shall be secured by way of first ranking pari passu charge with the Existing Secured Creditors on all
movable assets, including book debts and receivables, cash and bank balances, loans and advances, both present
and future of our Company equal to the value of one time of the NCDs outstanding plus interest accrued thereon.

Our Company will create the security for the NCDs in favour of the Debenture Trustee for the Debenture Holders
holding the NCDs on the assets to ensure 100.00% security cover of the amount outstanding including interest in
respect of the NCDs at any time.

Our Company has entered into the Debenture Trusteeship Agreement and in furtherance thereof intends to enter
into a deed of agreement with the Debenture Trustee, (“Debenture Trust Deed”), the terms of which shall govern
the appointment of the Debenture Trustee and the issue of the NCDs. Our Company proposes to complete the
execution of the Debenture Trust Deed before finalisation of the Basis of Allotment in consultation with the
Designated Stock Exchange and shall utilise the funds only after the stipulated security has been created.

Under the terms of the Debenture Trust Deed, our Company will covenant with the Debenture Trustee that it will
pay the Debenture Holders holding the NCDs the principal amount on the NCDs on the relevant redemption date
and also that it will pay the interest due on the NCDs at the rate specified in this Prospectus and in the Debenture
Trust Deed.

The Debenture Trust Deed will also provide that our Company may withdraw any portion of the security subject
to prior written consent of the Debenture Trustee and/or may replace with another asset of the same or a higher
value.

Our Company confirms that the Issue Proceeds shall be kept in the Public Issue Account until the documents for
creation of security i.e. the Debenture Trust Deed, is executed.

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Further, in the event our Company fails to execute the Debenture Trust Deed within a period of three months from
the Issue Closing Date, our Company shall pay interest of at least 2% p.a. to each NCD Holder, over and above
the agreed coupon rate, till the execution of the Debenture Trust Deed.

Debenture Redemption Reserve

Pursuant to Regulation 16 of the SEBI Debt Regulations and Section 71(4) of the Companies Act, 2013 states that
where debentures are issued by any company, the company shall create a debenture redemption reserve out of the
profits of the company available for payment of dividend. Rule 18(7) of the Companies (Share Capital and
Debentures) Rules, 2014, as amended by Companies (Share Capital and Debentures) Amendment Rules, 2019,
listed NBFC is not required to create a DRR in case of public issue of debentures. The rules further mandate that
the company which is coming with a Public Issue shall deposit or invest, as the case may be, before the 30th day
of April of each year a sum which shall not be less than 15% of the amount of its debentures maturing during the
year ending on the 31st day of March of the next year in any one or more prescribed methods.

Accordingly, our Company is not required to create a DRR for the NCDs proposed to be issued through this Issue.
Further, our Company shall deposit or invest, as the case may be, before the 30th day of April of each year a sum
which shall not be less than 15% of the amount of its debentures maturing during the year ending on the 31st day
of March of the next year in any one or more following methods: (a) in deposits with any scheduled bank, free
from charge or lien; (b) in unencumbered securities of the Central Government or of any State Government; (c)
in unencumbered securities mentioned in clauses (a) to (d) and (ee) of Section 20 of the Indian Trusts Act, 1882;
(d) in unencumbered bonds issued by any other company which is notified under clause (f) of Section 20 of the
Indian Trusts Act, 1882. The abovementioned amount deposited or invested, must not be utilized for any purpose
other than for the repayment of debentures maturing during the year provided that the amount remaining deposited
or invested must not at any time fall below 15% of the amount of debentures maturing during year ending on the
31st day of March of that year, in terms of the applicable laws.

Face Value

The face value of each NCD to be issued under this Issue shall be `1,000.

Debenture Holder not a Shareholder

The Debenture Holders will not be entitled to any of the rights and privileges available to the equity and/or
preference shareholders of our Company, except to the extent of the right to receive the annual reports of our
Company and such other rights as may be prescribed under the Companies Act, 2013 and the rules prescribed
thereunder and the SEBI Listing Regulations.

Rights of Debenture Holders

Some of the significant rights available to the Debenture Holders are as follows:

1. The NCDs shall not, except as provided under the Companies Act, 2013, confer upon the Debenture Holders
thereof any rights or privileges available to our members including the right to receive notices or annual
reports of, or to attend and/or vote, at our general meeting. However, if any resolution affecting the rights
attached to the NCDs is to be placed before the members, the said resolution will first be placed before the
concerned registered Debenture Holders for their consideration. The opinion of the Debenture Trustee as to
whether such resolution is affecting the right attached to the NCDs is final and binding on Debenture Holders.
In terms of Section 136 of the Companies Act, 2013, holders of NCDs shall be entitled to a copy of the
balance sheet and copy of trust deed on a specific request made to us.

2. Subject to applicable statutory/regulatory requirements and terms of the Debenture Trust Deed, including
requirements of the RBI, the rights, privileges and conditions attached to the NCDs may be varied, modified
and/or abrogated with the consent in writing of the holders of at least three-fourths of the outstanding amount
of the NCDs or with the sanction of a special resolution passed at a meeting of the concerned Debenture
Holders, provided that nothing in such consent or resolution shall be operative against us, where such consent
or resolution modifies or varies the terms and conditions governing the NCDs, if the same are not acceptable
to us.

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3. Subject to applicable statutory/regulatory requirements and terms of the Debenture Trust Deed, the registered
Debenture Holder or in case of joint-holders, the one whose name stands first in the register of debenture
holders shall be entitled to vote in respect of such NCDs, either in person or by proxy, at any meeting of the
concerned Debenture Holders and every such holder shall be entitled to one vote on a show of hands and on
a poll, his/her voting rights on every resolution placed before such meeting of the Debenture Holders shall be
in proportion to the outstanding nominal value of NCDs held by him/her.

4. The NCDs are subject to the provisions of the SEBI Debt Regulations, the applicable provisions of Companies
Act, 2013 and the Companies Act, 1956, the Memorandum and Articles of Association of our Company, the
terms of this Prospectus, the Application Form, the terms and conditions of the Debenture Trust Deed,
requirements of the RBI, other applicable statutory and/or regulatory requirements relating to the issue and
listing, of securities and any other documents that may be executed in connection with the NCDs.

5. The Depositories shall maintain the up to date record of holders of the NCDs in dematerialised form. In terms
of Section 88(3) of the Companies Act, 2013, the register and index of beneficial of NCDs maintained by a
Depository for any NCD in dematerialised form under Section 11 of the Depositories Act shall be deemed to
be a register of Debenture Holders for this purpose.

6. A register of Debenture Holders holding NCDs in physical form pursuant to rematerialisation of the NCDs
issued pursuant to this Issue (“Register of Debenture Holder”) will be maintained in accordance with
Section 88 of the Companies Act, 2013 and all interest/redemption amounts and principal sums becoming
due and payable in respect of the NCDs will be paid to the registered holder thereof for the time being or in
the case of joint-holders, to the person whose name stands first in the Register of Debenture Holders as on
the Record Date.

7. Subject to compliance with RBI requirements, NCDs can be rolled over only with the consent of the holders
of at least 75% of the outstanding amount of the NCDs after providing at least 21 days’ prior notice for such
roll over and in accordance with the SEBI Debt Regulations. Our Company shall redeem the debt securities
of all the debt securities holders, who have not given their positive consent to the roll-over.

The aforementioned rights of the Debenture Holders are merely indicative. The final rights of the Debenture
Holders will be as per the terms of Prospectus, the Debenture Trust Deed to be executed between our Company
and the Debenture Trustee.

Debenture Trustees for the Debenture Holders

We have appointed Vistra ITCL (India) Limited to act as the Debenture Trustees for the Debenture Holders in
terms of Regulation 4(4) of the SEBI Debt Regulations and Section 71(5) of the Companies Act, 2013 and the
rules prescribed thereunder. We and the Debenture Trustee will execute a Debenture Trust Deed, inter alia,
specifying the powers, authorities and obligations of the Debenture Trustee and us with respect to the NCDs. The
Debenture Holder(s) shall, without further act or deed, be deemed to have irrevocably given their consent to the
Debenture Trustee or any of its agents or authorised officials to do all such acts, deeds, matters and things in
respect of or relating to the NCDs as the Debenture Trustee may in its absolute discretion deem necessary or
require to be done in the interest of the Debenture Holder(s). Any payment made by us to the Debenture Trustee
on behalf of the Debenture Holder(s) shall discharge us pro tanto to the Debenture Holder(s).

The Debenture Trustee will protect the interest of the Debenture Holders in the event of default by us in regard to
timely payment of interest and repayment of principal and they will take necessary action at our cost.

Events of Default

Subject to the terms of the Debenture Trust Deed, the Debenture Trustee, at its discretion may, or if so requested
in writing by the holders of at least three-fourths of the outstanding amount of the NCDs or with the sanction of a
special resolution, passed at a meeting of the Debenture Holders, (subject to being indemnified and/or secured by
the Debenture Holders to its satisfaction), give notice to our Company specifying that the NCDs and/or any
particular options of NCDs, in whole but not in part are and have become due and repayable on such date as may
be specified in such notice inter alia if any of the events listed below occurs. The description below is indicative
and a complete list of events of default including cross defaults, if any, and its consequences will be specified in
the Debenture Trust Deed:

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(i) default is committed in payment of the principal amount of the NCDs on the due date(s); and
(ii) default is committed in payment of any interest on the NCDs on the due date(s).

Market Lot and Trading Lot

Since trading of the NCDs is in dematerialised form, the tradable lot is one NCD.

Allotment in the Issue will be in Demat form in multiples of one NCD. For details of allotment, see “Issue
Procedure” on page 157.

Nomination facility to Debenture Holder

In accordance with Rule 19 of the Companies (Share Capital and Debentures) Rules, 2014 (“Rule 19”) and Section
72 of the Companies Act, 2013, the sole Debenture Holder, or first Debenture Holder, along with other joint
Debenture Holders’ (being individual(s)), may nominate, in the Form No. SH.13, any one person in whom, in the
event of the death of Applicant the NCDs Allotted, if any, will vest. Where the nomination is made in respect of
the NCDs held by more than one person jointly, all joint holders shall together nominate in Form No. SH.13 any
person as nominee. A nominee entitled to the NCDs by reason of the death of the original holder(s), will, in
accordance with Rule 19 and Section 56 of the Companies Act, 2013, be entitled to the same benefits to which he
or she will be entitled if he or she were the registered holder of the NCDs. Where the nominee is a minor, the
holder(s) may make a nomination to appoint, in Form No. SH.14, any person to become entitled to NCDs in the
event of the holder’s death during minority. A nomination will stand rescinded on a sale/transfer/alienation of
NCDs by the person nominating. A buyer will be entitled to make a fresh nomination in the manner prescribed.
Fresh nomination can be made only on the prescribed form available on request at our Registered Office,
Corporate Office or with the Registrar to the Issue.

Debenture Holder(s) are advised to provide the specimen signature of the nominee to us to expedite the
transmission of the NCD(s) to the nominee in the event of demise of the Debenture Holder(s). The signature can
be provided in the Application Form or subsequently at the time of making fresh nominations. This facility of
providing the specimen signature of the nominee is purely optional.

In accordance with Rule 19, any person who becomes a nominee by virtue of the Rule 19, will on the production
of such evidence as may be required by the Board, elect either:

• to register himself or herself as the holder of the NCDs; or

• to make such transfer of the NCDs, as the deceased holder could have made.

Further, the Board may at any time give notice requiring any nominee to choose either to be registered himself or
herself or to transfer the NCDs, and if the notice is not complied with, within a period of 90 days, the Board may
thereafter withhold payment of all interests or redemption amounts or other monies payable in respect of the
NCDs, until the requirements of the notice have been complied with.

For all NCDs held in the dematerialized form, nominations registered with the respective Depository Participant
of the Applicant would prevail. If the investors require changing their nomination, they are requested to inform
their respective Depository Participant in connection with NCDs held in the dematerialized form.

A nomination may be cancelled or varied by nominating any other person in place of the present nominee, by the
Debenture Holder who has made the nomination, by giving a notice of such cancellation or variation in the
prescribed manner as per applicable laws. The cancellation or variation shall take effect from the date on which
the notice of such variation or cancellation is received.

For all NCDs held in the dematerialised form and since the allotment of NCDs pursuant to this Issue will be made
only in dematerialized mode, there is no need to make a separate nomination with our Company. The nominations
registered with the respective Depository Participant of the Applicant would prevail. If the investors require
changing their nomination, they are requested to inform their respective Depository Participant in connection with
NCDs held in the dematerialised form.

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Jurisdiction

Exclusive jurisdiction for the purpose of the Issue is with the competent courts of jurisdiction in Kochi, Kerala
India.

Application in the Issue

Applicants shall apply in this Issue in dematerialised form only, through a valid Application Form filled in by the
Applicant along with attachment, as applicable. Further, Applications in this Issue shall be made through the
ASBA facility only.

In terms of Regulation 4(2)(d) of the SEBI Debt Regulations, our Company will make public issue of the NCDs
in the dematerialised form only.

However, in terms of Section 8(1) of the Depositories Act, our Company, at the request of the Investors who wish
to hold the NCDs in physical form will rematerialise the NCDs. However, any trading of the NCDs shall be
compulsorily in dematerialised form only.

Form of Allotment and Denomination of NCDs

As per the SEBI Debt Regulations, the trading of the NCDs on the Stock Exchange shall be in dematerialized
form only in multiples of one (1) NCD (“Market Lot”). Allotment in this Issue to all Allottees, will be in
electronic form i.e. in dematerialised form and in multiples of one NCD.

For details of allotment please see “Issue Procedure” on page 157.

Transfer/Transmission of NCD(s)

The NCDs shall be transferred or transmitted freely in accordance with the applicable provisions of the Companies
Act, 2013. The NCDs held in dematerialised form shall be transferred subject to and in accordance with the
rules/procedures as prescribed by NSDL/CDSL and the relevant DPs of the transfer or transferee and any other
applicable laws and rules notified in respect thereof. The transferee(s) should ensure that the transfer formalities
are completed prior to the Record Date. The seller should give delivery instructions containing details of the
buyer’s DP account to his Depository Participant.

In the absence of the same, interest will be paid/redemption will be made to the person, whose name appears in
the register of debenture holders maintained by the Depositories. In such cases, claims, if any, by the transferees
would need to be settled with the transferor(s) and not with the Company or Registrar.

Pursuant to the SEBI (Listing Obligations and Disclosure Requirements) (Fourth Amendment) Regulations, 2018
read with SEBI Press release (no. 49/ 2018) dated December 3, 2018, NCDs held in physical form, pursuant to
any rematerialisation, as above, cannot be transferred except by way of transmission or transposition, from April
1, 2019. However, any trading of the NCDs issued pursuant to this Issue shall be compulsorily in dematerialised
form only.

Title

In case of:

• the NCDs held in the dematerialised form, the person for the time being appearing in the record of beneficial
owners maintained by the Depository; and

• the NCD held in physical form, pursuant to any rematerialisation, the person for the time being appearing in
the Register of Debenture Holders as Debenture Holder,

shall be treated for all purposes by our Company, the Debenture Trustee, the Depositories and all other persons
dealing with such person as the holder thereof and its absolute owner for all purposes regardless of any notice of
ownership, trust or any interest in it or any writing on, theft or loss of the Consolidated NCD Certificate issued in
respect of the NCDs and no person will be liable for so treating the Debenture Holder.

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No transfer of title of NCD will be valid unless and until entered on the Register of Debenture Holders or the
register and index of Debenture Holders maintained by the Depository prior to the Record Date. In the absence of
transfer being registered, interest and/or Maturity Amount, as the case may be, will be paid to the person, whose
name appears first in the Register of Debenture Holders maintained by the Depositories and/or our Company
and/or the Registrar, as the case may be. In such cases, claims, if any, by the purchasers of the NCDs will need to
be settled with the seller of the NCDs and not with our Company or the Registrar. The provisions relating to
transfer and transmission and other related matters in respect of our Company’s shares contained in the Articles
of Association of our Company and the Companies Act/ the relevant provisions of the Companies Act applicable
as on the date of this Prospectus shall apply, mutatis mutandis (to the extent applicable) to the NCD(s) as well.

Succession

Where NCDs are held in joint names and one of the joint holders dies, the survivor(s) will be recognized as the
Debenture Holder(s). It will be sufficient for our Company to delete the name of the deceased Debenture Holder
after obtaining satisfactory evidence of his death. Provided, a third person may call on our Company to register
his name as successor of the deceased Debenture Holder after obtaining evidence such as probate of a will for the
purpose of proving his title to the debentures. In the event of demise of the sole or first holder of the Debentures,
the Company will recognise the executors or administrator of the deceased Debenture Holders, or the holder of
the succession certificate or other legal representative as having title to the Debentures only if such executor or
administrator obtains and produces probate or letter of administration or is the holder of the succession certificate
or other legal representation, as the case may be, from an appropriate court in India. The directors of the Company
in their absolute discretion may, in any case, dispense with production of probate or letter of administration or
succession certificate or other legal representation. In case of death of Debenture Holders who are holding NCDs
in dematerialised form, third person is not required to approach the Company to register his name as successor of
the deceased Debenture Holder. He shall approach the respective Depository Participant of the Debenture Holder
for this purpose and submit necessary documents as required by the Depository Participant.

Where a non-resident Indian becomes entitled to the NCDs by way of succession, the following steps have to be
complied with:

1. Documentary evidence to be submitted to the Legacy Cell of the RBI to the effect that the NCDs were
acquired by the non-resident Indian as part of the legacy left by the deceased Debenture Holder.

2. Proof that the non-resident Indian is an Indian national or is of Indian origin.

3. Such holding by a non-resident Indian will be on a non-repatriation basis.

Joint-holders

Where two or more persons are holders of any NCD(s), they shall be deemed to hold the same as joint holders
with benefits of survivorship subject to other provisions contained in the Articles.

Procedure for Re-materialization of NCDs

Debenture Holders who wish to hold the NCDs in physical form may do so by submitting a request to their DP at
any time after Allotment in accordance with the applicable procedure stipulated by the DP, in accordance with the
Depositories Act and/or rules as notified by the Depositories from time to time. Holders of NCDs who propose
to rematerialise their NCDs, would have to mandatorily submit details of their bank mandate along with a
copy of any document evidencing that the bank account is in the name of the holder of such NCDs and their
Permanent Account Number to the Company and the DP. No proposal for rematerialisation of NCDs would
be considered if the aforementioned documents and details are not submitted along with the request for
such rematerialisation.

Restriction on transfer of NCDs

There are no restrictions on transfers and transmission of NCDs Allotted pursuant to this Issue. Pursuant to the
SEBI Listing Regulations, NCDs held in physical form, pursuant to any rematerialisation, as above, cannot be
transferred except by way of transmission or transposition, with effect from April 1, 2019.

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Period of Subscription

The subscription list shall remain open for a period as indicated below, with an option for early closure or
extension by such period, as may be decided by the Board or a duly authorised committee of Directors of our
Company, subject to necessary approvals. In the event of such early closure of the Issue, our Company shall ensure
that notice of such early closure is given one day prior to such early date of closure through advertisement/s in a
leading national daily newspaper.

Issue Programme

Issue Opening Date September 9, 2020

Issue Closing Date October 6, 2020#

#
The Issue shall remain open for subscription on Working Days from 10:00 a.m. to 5:00 p.m. (Indian Standard
Time), during the period indicated above, except that the Issue may close on such earlier date or extended date
(subject to a period of maximum 30 days from the date of Prospectus) as may be decided by the Board of Directors
of our Company (“Board”) or the Debenture Committee. In the event of such an early closure of or extension
subscription list of the Issue, our Company shall ensure that notice of such early closure or extension is given to
the prospective investors through an advertisement in a national daily newspaper with wide circulation on or
before such earlier date or extended date of closure. Applications Forms for the Issue will be accepted only from
10:00 a.m. to 5:00 p.m. (Indian Standard Time) or such extended time as may be permitted by BSE, on Working Days
during the Issue Period. On the Issue Closing Date, Application Forms will be accepted only between 10:00 a.m.
to 3:00 p.m. and uploaded until 5:00 p.m. (Indian Standard Time) or such extended time as may be permitted by
BSE.

Application and any further changes to the Applications shall be accepted only between 10.00 a.m. and 5.00 p.m.
(Indian Standard Time, “IST”) during the Issue Period as mentioned above by the Designated Intermediaries at
the bidding centre and by the SCSBs directly at the Designated Branches of SCSBs, except that on the Issue
Closing Date when the Applications and any further changes in details in Applications, if any, shall be accepted
only between 10.00 a.m. and 3.00 p.m. (IST) and shall be uploaded until 5.00 p.m. (IST) or such extended time as
permitted by the Stock Exchange. It is clarified that the Applications not uploaded in the Stock Exchange platform
would be rejected.

Due to limitation of time available for uploading the Applications on the Issue Closing Date, the Applicants are
advised to submit their Applications one day prior to the Issue Closing Date and, in any case, no later than 3.00
p.m. (IST) on the Issue Closing Date. All times mentioned in this Prospectus are Indian Standard Time. Applicants
are cautioned that in the event a large number of Applications are received on the Issue Closing Date, as is
typically experienced in public offerings, some Applications may not get uploaded due to lack of sufficient time.
Such Applications that cannot be uploaded will not be considered for Allocation under the Issue. Applications
will be accepted only on Business Days, i.e., Monday to Friday (excluding any public holiday). Neither our
Company, nor the Lead Manager, nor any Member of the Syndicate, Registered Brokers at the Broker Centres,
CDPs at the Designated CDP Locations or the RTAs at the Designated RTA Locations or Designated Branches
of SCSBs are liable for any failure in uploading the Applications due to faults in any software/hardware system
or otherwise.

Basis of payment of Interest

NCDs once Allotted under any particular category of NCDs shall continue to bear the applicable tenor,
Coupon/Yield and Redemption Amount as at the time of original Allotment irrespective of the category of
Debenture Holder on any Record Date, and such Tenor, Coupon/Yield and Redemption Amount as at the time of
original Allotment will not be impacted by trading of any series of NCDs between the categories of persons or
entities in the secondary market.

Payment of Interest/Maturity Amount will be made to those Debenture Holders whose names appear in the
Register of Debenture Holders (or to first holder in case of joint-holders) as on Record Date.

We may enter into an arrangement with one or more banks in one or more cities for direct credit of interest to the
account of the Investors. In such cases, interest, on the Interest Payment Date, would be directly credited to the
account of those Investors who have given their bank mandate.

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We may offer the facility of NACH, NEFT, RTGS, Direct Credit and any other method permitted by RBI and
SEBI from time to time to help Debenture Holders. The terms of this facility (including towns where this facility
would be available) would be as prescribed by RBI. Please see, “- Manner of Payment of Interest / Redemption
Amounts” on page 151.

Taxation

Any tax exemption certificate/document must be lodged at the office of the Registrar at least 7 working (seven)
days prior to the Record Date or as specifically required, failing which tax applicable on interest will be deducted
at source on accrual thereof in our Company’s books and/or on payment thereof, in accordance with the provisions
of the IT Act and/or any other statutory modification, enactment or notification as the case may be. A tax deduction
certificate will be issued for the amount of tax so deducted.

As per clause (ix) of Section 193 of the I.T. Act, no tax is required to be withheld on any interest payable on any
security issued by a company, where such security is in dematerialised form and is listed on a recognized stock
exchange in India in accordance with the Securities Contracts (Regulation) Act, 1956 and the rules made
thereunder. Accordingly, no tax will be deducted at source from the interest on listed NCDs held in the
dematerialised form.

If the date of interest payment falls on a Saturday, Sunday or a public holiday in Mumbai or any other payment
centre notified in terms of the Negotiable Instruments Act, 1881, then interest would be paid on the next working
day. Payment of interest would be subject to the deduction as prescribed in the I.T. Act or any statutory
modification or re-enactment thereof for the time being in force.

Subject to the terms and conditions in connection with computation of applicable interest on the Record Date,
please note that in case the NCDs are transferred and/or transmitted in accordance with the provisions of this
Prospectus read with the provisions of the Articles of Association of our Company, the transferee of such NCDs
or the deceased holder of NCDs, as the case may be, shall be entitled to any interest which may have accrued on
the NCDs.

Day Count Convention

Interest shall be computed on actual/actual basis i.e. on the principal outstanding on the NCDs as per the SEBI
Circular bearing no. CIR/IMD/DF-1/122/2016 dated November 11, 2016.

Effect of holidays on payments

If the date of payment of interest does not fall on a Working Day, then the interest payment will be made on
succeeding Working Day (the “Effective Date”), however the calculation for payment of interest will be only till
the originally stipulated Interest Payment Date. The dates of the future interest payments would be as per the
originally stipulated schedule. Payment of interest will be subject to the deduction of tax as per Income Tax Act
or any statutory modification or re-enactment thereof for the time being in force. In case the Maturity Date (also
being the last Interest Payment Date) does not fall on a Working Day, the payment will be made on the
immediately preceding Working Day, along with coupon/interest accrued on the NCDs until but excluding the
date of such payment.

Illustration for guidance in respect of the day count convention and effect of holidays on payments

The illustration for guidance in respect of the day count convention and effect of holidays on payments, as required
by SEBI Circular No. CIR/IMD/DF-1/122/2016 dated November 11, 2016 is disclosed at “Annexure I” on page
240.

Maturity and Redemption

The NCDs issued pursuant to this Prospectus have a fixed maturity date. The NCDs will be redeemed at the expiry
of 480 days from the Deemed Date of Allotment for Option I, 24 months from the Deemed Date of Allotment for
Option II and III, 36 months from the Deemed Date of Allotment for Option IV, 50 months from the Deemed
Date of Allotment for Option V, 60 months from the Deemed Date of Allotment for Option VI and 85 months
from the Deemed Date of Allotment for Option VII.

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Application Size

Each Application should be for a minimum of 10 NCDs and multiples of one NCD thereof. The minimum
Application size for each Application would be `10,000 (for all kinds of Options I, II, III, IV, V, VI and VII)
NCDs either taken individually or collectively) and in multiples of `1,000 thereafter.

Applicants can apply for any or all options of NCDs offered hereunder provided the Applicant has applied for
minimum Application size using the same Application Form.

Applicants are advised to ensure that Application made by them do not exceed the investment limits or
maximum number of NCDs that can be held by them under applicable statutory and or regulatory
provisions.

Terms of Payment

The entire issue price of `1,000 per NCD is blocked in the ASBA Account on Application itself. In case of
Allotment of lesser number of NCDs than the number of NCDs applied for, our Company shall instruct the SCSBs
to unblock the excess amount blocked on Application in accordance with the terms of the Prospectus.

Manner of Payment of Interest / Redemption Amounts

The manner of payment of interest / redemption in connection with the NCDs is set out below:

For NCDs held in dematerialised form:

The bank details will be obtained from the Depositories for payment of interest / redemption amount as the case
may be. Holders of the NCDs, are advised to keep their bank account details as appearing on the records of the
Depository Participant updated at all points of time. Please note that failure to do so could result in delays in credit
of interest/redemption amounts at the Applicant’s sole risk, and the Lead Manager, our Company or the Registrar
shall have no responsibility and undertake no liability for the same.

For NCDs held in physical form on account of re-materialization:

In case of NCDs held in physical form, on account of rematerialisation, the bank details will be obtained from the
documents submitted to the Company along with the rematerialisation request. For further details, please see “-
Procedure for Re-materialization of NCDs” on page 148.

The mode of payment of interest/redemption amount shall be undertaken in the following order of preference:

1. Direct Credit/ NACH/ RTGS: Investors having their bank account details updated with the Depository shall
be eligible to receive payment of interest / redemption amount, through:

(i) Direct Credit. interest / redemption amount would be credited directly to the bank accounts of the
Investors, if held with the same bank as the Company.

(ii) NACH: National Automated Clearing House which is a consolidated system of ECS. Payment of interest
/ redemption amount would be done through NACH for Applicants having an account at one of the
centres specified by the RBI, where such facility has been made available. This would be subject to
availability of complete bank account details including Magnetic Ink Character Recognition (MICR)
code wherever applicable from the depository. The payment of interest / redemption amount through
NACH is mandatory for Applicants having a bank account at any of the centres where NACH facility
has been made available by the RBI (subject to availability of all information for crediting the interest /
redemption amount through NACH including the MICR code as appearing on a cheque leaf, from the
depositories), except where Applicant is otherwise disclosed as eligible to get interest / redemption
amount through NEFT or Direct Credit or RTGS.

(iii) RTGS: Applicants having a bank account with a participating bank and whose interest / redemption
amount exceeds `2 lakhs, or such amount as may be fixed by RBI from time to time, have the option to
receive the interest / redemption amount through RTGS. Such eligible Applicants who indicate their
preference to receive interest / redemption amount through RTGS are required to provide the IFSC code

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in the Application Form or intimate our Company and the Registrar to the Issue at least 7 (seven) days
before the Record Date. Charges, if any, levied by the Applicant’s bank receiving the credit would be
borne by the Applicant. In the event the same is not provided, interest / redemption amount shall be made
through NECS subject to availability of complete bank account details for the same as stated above.

(iv) NEFT: Payment of interest / redemption amount shall be undertaken through NEFT wherever the
Applicants’ bank has been assigned the Indian Financial System Code (“IFSC”), which can be linked to
a Magnetic Ink Character Recognition, if any, available to that particular bank branch. IFSC Code will
be obtained from the website of RBI as on a date immediately prior to the date of payment of the interest
/ redemption amounts, duly mapped with MICR numbers. Wherever the Applicants have registered their
nine-digit MICR number and their bank account number while opening and operating the de-mat account,
the same will be duly mapped with the IFSC Code of that particular bank branch and the payment of
interest / redemption amount will be made to the Applicants through this method.

2. Registered Post/Speed Post: For all other Debenture Holders, including those who have not updated their
bank particulars with the MICR code, the interest payment / redemption amount shall be paid by way of
interest/ redemption warrants dispatched through speed post/ registered post only to Applicants that have
provided details of a registered address in India.

Printing of Bank Particulars on Interest/ Redemption Warrants

As a matter of precaution against possible fraudulent encashment of interest/ redemption warrants due to loss or
misplacement, the particulars of the Applicant’s bank account are mandatorily required to be given for printing
on the orders/ warrants. In relation to NCDs held dematerialised form, these particulars would be taken directly
from the depositories. In case of NCDs held in physical form on account of rematerialisation, the Investors are
advised to submit their bank account details with our Company / Registrar at least seven working (7) days prior
to the Record Date failing which the orders / warrants will be dispatched to the postal address of the holder of the
NCD as available in the records of our Company. Bank account particulars will be printed on the warrants which
can then be deposited only in the account specified.

Loan against NCDs

Pursuant to RBI Circular dated June 27, 2013, our Company, being an NBFC, is not permitted to extend any loans
against the security of its NCDs.

Buy Back of NCDs

Our Company may, at its sole discretion, from time to time, consider, subject to applicable statutory and/or
regulatory requirements, buyback of NCDs, upon such terms and conditions as may be decided by our Company.

Our Company may from time to time invite the Debenture Holders to offer the NCDs held by them through one
or more buy-back schemes and/or letters of offer upon such terms and conditions as our Company may from time
to time determine, subject to applicable statutory and/or regulatory requirements. Such NCDs which are bought
back may be extinguished, re-issued and/or resold in the open market with a view of strengthening the liquidity
of the NCDs in the market, subject to applicable statutory and/or regulatory requirements.

Procedure for Redemption by Debenture Holders

The procedure for redemption is set out below:

NCDs held in physical form on account of re-materialization:

No action would ordinarily be required on the part of the Debenture Holder at the time of redemption and the
redemption proceeds would be paid to those Debenture Holders whose names stand in the register of Debenture
Holders maintained by us on the Record Date fixed for the purpose of redemption. However, our Company may
require that the NCD certificate(s), duly discharged by the sole holder/all the joint-holders (signed on the reverse
of the NCD certificate(s)) be surrendered for redemption on maturity and should be sent by the Debenture
Holder(s) by Registered Post with acknowledgment due or by hand delivery to our office or to such persons at
such addresses as may be notified by us from time to time. Debenture Holder(s) may be requested to surrender

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the NCD certificate(s) in the manner as stated above, not more than three months and not less than one month
prior to the redemption date so as to facilitate timely payment.

We may at our discretion redeem the NCDs without the requirement of surrendering of the NCD certificates by
the holder(s) thereof. In case we decide to do so, the holders of NCDs need not submit the NCD certificates to us
and the redemption proceeds would be paid to those Debenture Holders whose names stand in the register of
Debenture Holders maintained by us on the Record Date fixed for the purpose of redemption of NCDs. In such
case, the NCD certificates would be deemed to have been cancelled. Also see “- Payment on Redemption” on page
153.

NCDs held in electronic form:

No action is required on the part of Debenture Holder(s) at the time of redemption of NCDs.

Payment on Redemption

The manner of payment of redemption is set out below:

NCDs held in physical form on account of re-materialisation

The payment on redemption of the NCDs will be made by way of cheque/pay order/ electronic modes. However,
if our Company so requires, the aforementioned payment would only be made on the surrender of NCD
certificate(s), duly discharged by the sole holder / all the joint-holders (signed on the reverse of the NCD
certificate(s)). Dispatch of cheques/pay order, etc. in respect of such payment will be made on the redemption
date or (if so requested by our Company in this regard) within a period of 30 days from the date of receipt of the
duly discharged NCD certificate.

In case we decide to do so, the redemption proceeds in the manner stated above would be paid on the redemption
date to those Debenture Holders whose names stand in the Register of Debenture Holders maintained by
us/Registrar to the Issue on the Record Date fixed for the purpose of redemption. Hence the transferees, if any,
should ensure lodgement of the transfer documents with us at least 7 working (seven) days prior to the Record
Date. In case the transfer documents are not lodged with us at least 7 working (seven) days prior to the Record
Date and we dispatch the redemption proceeds to the transferor, claims in respect of the redemption proceeds
should be settled amongst the parties inter se and no claim or action shall lie against us or the Registrar.

Our liability to holder(s) towards their rights including for payment or otherwise shall stand extinguished from
the date of redemption in all events and when we dispatch the redemption amounts to the Debenture Holder(s).

Further, we will not be liable to pay any interest, income or compensation of any kind from the date of redemption
of the NCD(s).

NCDs held in electronic form

On the redemption date, redemption proceeds would be paid by cheque /pay order / electronic mode to those
Debenture Holders whose names appear on the list of beneficial owners given by the Depositories to us. These
names would be as per the Depositories’ records on the Record Date fixed for the purpose of redemption. These
NCDs will be simultaneously extinguished to the extent of the amount redeemed through appropriate debit
corporate action upon redemption of the corresponding value of the NCDs. It may be noted that in the entire
process mentioned above, no action is required on the part of Debenture Holders.

Our liability to Debenture Holder(s) towards his/their rights including for payment or otherwise shall stand
extinguished from the date of redemption in all events and when we dispatch the redemption amounts to the
Debenture Holder(s).

Further, we will not be liable to pay any interest, income or compensation of any kind from the date of redemption
of the NCD(s).

Right to reissue NCD(s)

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Subject to the provisions of the Companies Act, 2013, where we have fully redeemed or repurchased any NCD(s),
we shall have and shall be deemed always to have had the right to keep such NCDs in effect without
extinguishment thereof, for the purpose of resale or reissue and in exercising such right, we shall have and be
deemed always to have had the power to resell or reissue such NCDs either by reselling or reissuing the same
NCDs or by issuing other NCDs in their place. The aforementioned right includes the right to reissue original
NCDs.

Sharing of information

We may, at our option, use on our own, as well as exchange, share or part with any financial or other information
about the Debenture Holders available with us, and affiliates and other banks, financial institutions, credit bureaus,
agencies, statutory bodies, as may be required and neither we or our affiliates nor their agents shall be liable for
use of the aforesaid information.

Notices

All notices to the Debenture Holder(s) required to be given by us or the Debenture Trustee shall be published in
one English language newspaper having wide circulation and one regional language daily newspaper in Kerala
and/or will be sent by post/ courier or through email or other electronic media to the registered holders of the
NCD(s) from time to time.

Issue of duplicate NCD Certificate(s)

If any NCD certificate(s), issued pursuant to rematerialisation, if any, is/are mutilated or defaced or the cages for
recording transfers of NCDs are fully utilised, the same may be replaced by us against the surrender of such
certificate(s). Provided, where the NCD certificate(s) are mutilated or defaced, the same will be replaced as
aforesaid only if the certificate numbers and the distinctive numbers are legible.

If any NCD certificate is destroyed, stolen or lost then upon production of proof thereof to our satisfaction and
upon furnishing such indemnity/security and/or documents as we may deem adequate, duplicate NCD
certificate(s) shall be issued. Upon issuance of a duplicate NCD certificate, the original NCD certificate shall
stand cancelled.

Future Borrowings

We will be entitled to borrow/raise loans or avail of financial assistance in whatever form as also to issue
debentures/ NCDs/other securities in any manner having such ranking in priority, pari passu or otherwise, subject
to applicable consents, approvals or permissions that may be required under any statutory/regulatory/contractual
requirement, and change the capital structure including the issue of shares of any class, on such terms and
conditions as we may think appropriate, without the consent of, or intimation to, the Debenture Holders or the
Debenture Trustee in this connection.

Impersonation

As a matter of abundant caution, attention of the Investors is specifically drawn to the provisions of sub-section
(1) of Section 38 of the Companies Act, 2013 which is reproduced below:

“Any person who:

(a) makes or abets making of an application in a fictitious name to a company for acquiring, or subscribing
for, its securities; or

(b) makes or abets making of multiple applications to a company in different names or in different
combinations of his name or surname for acquiring or subscribing for its securities; or

(c) otherwise induces directly or indirectly a company to allot, or register any transfer of, securities to him,
or to any other person in a fictitious name, shall be liable for action under Section 447.”

The liability prescribed under Section 447 of the Companies Act 2013 for fraud involving an amount of at least
`10 lakh or 1.00% of the turnover of the Company, whichever is lower, includes imprisonment for a term which

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shall not be less than six months extending up to 10 years (provided that where the fraud involves public interest,
such term shall not be less than three years) and fine of an amount not less than the amount involved in the fraud,
extending up to three times of such amount. In case the fraud involves (i) an amount which is less than `10 lakh
or 1.00% of the turnover of the Company, whichever is lower; and (ii) does not involve public interest, then such
fraud is punishable with an imprisonment for a term extending up to five years or a fine of an amount extending
up to `50 lakh or with both.

Pre-closure

Our Company, in consultation with the Lead Manager reserves the right to close this Issue at any time prior to the
Issue Closing Date, subject to receipt of minimum subscription (75% of the Base Issue, i.e. `7,500 lakhs). Our
Company shall allot NCDs with respect to the Application Forms received at the time of such pre-closure in
accordance with the Basis of Allotment as described herein and subject to applicable statutory and/or regulatory
requirements. In the event of such early closure of this Issue, our Company shall ensure that public notice of such
early closure is published on or before such early date of closure or the Issue Closing Date for this Issue, as
applicable, through advertisement(s) in all those newspapers in which pre-issue advertisement and advertisement
for opening or closure of the Issue have been given.

Minimum Subscription

If our Company does not receive the minimum subscription of 75% of Base Issue Size i.e. `7,500 lakhs, prior to
the Issue Closing Date, the entire Application Amount shall be unblocked in the relevant ASBA Account(s) of the
Applicants within six Working Days from the Issue Closing Date provided wherein, the Application Amount has
been transferred to the Public Issue Account from the respective ASBA Accounts, such Application Amount shall
be refunded from the Refund Account to the relevant ASBA Accounts(s) of the Applicants within six Working
Days from the Issue Closing Date, failing which the Company will become liable to refund the Application
Amount along with interest at the rate 15 (fifteen) percent per annum for the delayed period.

Pre-Issue Advertisement

Subject to Section 30 of the Companies Act, 2013, our Company will issue a statutory advertisement on or before
the Issue Opening Date. This advertisement will contain the information as prescribed in Schedule IV of SEBI
Debt Regulations in compliance with the Regulation 8(1) of SEBI Debt Regulations. Material updates, if any,
between the date of filing of the Prospectus with RoC and the date of release of the statutory advertisement, will
be included in the statutory advertisement.

Listing

The NCDs offered through the Prospectus are proposed to be listed on the BSE. Our Company has obtained an
‘in-principle’ approval for the Issue from the BSE vide their letter dated August 27, 2020. For the purposes of the
Issue, BSE shall be the Designated Stock Exchange.

Our Company will use best efforts to ensure that all steps for the completion of the necessary formalities for listing
at the Stock Exchange is taken within six Working Days of the Issue Closing Date. For the avoidance of doubt, it
is hereby clarified that in the event of non-subscription to any one or more of the option, such option(s) of NCDs
shall not be listed. If permissions to deal in and for an official quotation of our NCDs are not granted by the Stock
Exchange, our Company will forthwith repay, without interest, all moneys received from the applicants in
pursuance of the Prospectus.

Guarantee/Letter of Comfort

This Issue is not backed by a guarantee or letter of comfort or any other document and/or letter with similar intent.

Arrangers

No arrangers have been appointed for this Issue.

Monitoring & Reporting of Utilisation of Issue Proceeds

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There is no requirement for appointment of a monitoring agency in terms of the SEBI Debt Regulations. Our
Board shall monitor the utilisation of the proceeds of the Issue. Our Company will disclose in the Company’s
financial statements for the relevant financial year commencing from Financial Year 2020-21, the utilisation of
the proceeds of the Issue under a separate head along with details, if any, in relation to all such proceeds of the
Issue that have not been utilised thereby also indicating investments, if any, of such unutilised proceeds of the
Issue

Lien

Not Applicable

Lien on Pledge of NCDs

Subject to applicable laws, our Company, at its discretion, may note a lien on pledge of NCDs if such pledge of
NCDs is accepted by any bank or institution for any loan provided to the Debenture Holder against pledge of such
NCDs as part of the funding.

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ISSUE PROCEDURE

This chapter applies to all Applicants. Pursuant to the circular (CIR/DDHS/P/121/2018) dated August 16, 2018
issued by SEBI, all Applicants are required to apply for in the Issue through the ASBA process and an amount
equivalent to the full Application Amount as mentioned in the Application Form will be blocked by the Designated
Branches of the SCSBs.

Applicants should note that they may submit their Application Forms at (i) the Designated Branches of the SCSBs
or (ii) at the Collection Centres, i.e. to the respective Members of the Consortium at the Specified Locations, the
Trading Members at the Broker Centres, the CRTA at the Designated RTA Locations or CDP at the Designated
CDP Locations. For further information, please see “- Submission of Completed Application Forms” on page
170.

Applicants are advised to make their independent investigations and ensure that their Application do not exceed
the investment limits or maximum number of NCDs that can be held by them under applicable law or as specified
in the Prospectus.

Please note that this section has been prepared based on the circular no. CIR./IMD/DF-1/20/2012 dated July 27,
2012 issued by SEBI (“Debt Application Circular”) as modified by circular (No. CIR/IMD/DF/18/2013) dated
October 29, 2013 issued by SEBI and circular no. CIR/DDHS/P/121/2018 dated August 16, 2018 issued by SEBI
(“Debt ASBA Circular”). The procedure mentioned in this section is subject to the Stock Exchange putting in
place the necessary systems and infrastructure for implementation of the provisions of the abovementioned
circular, including the systems and infrastructure required in relation to Applications made through the Direct
Online Application Mechanism and the online payment gateways to be offered by Stock Exchange and accordingly
is subject to any further clarifications, notification, modification, direction, instructions and/or correspondence
that may be issued by the Stock Exchange and/or SEBI.

Please note that clarifications and/or confirmations regarding the implementation of the requisite infrastructure
and facilities in relation to direct online applications and online payment facility as provided for in the Debt
Application Circular have been sought from the Stock Exchange and the Stock Exchange has confirmed that the
necessary infrastructure and facilities for the same have not been implemented by the Stock Exchange. Hence, the
Direct Online Application facility will not be available for this Issue.

THE DESIGNATED INTERMEDIARIES (OTHER THAN TRADING MEMBERS), SCSBs AND THE
COMPANY SHALL NOT BE RESPONSIBLE OR LIABLE FOR ANY ERRORS OR OMISSIONS ON
THE PART OF THE TRADING MEMBERS IN CONNECTION WITH THE RESPONSIBILITIES OF
SUCH TRADING MEMBERS INCLUDING BUT NOT LIMITED TO COLLECTION AND UPLOAD
OF APPLICATION FORMS IN THIS ISSUE ON THE ELECTRONIC APPLICATION PLATFORM
PROVIDED BY THE STOCK EXCHANGE. FURTHER, THE RELEVANT STOCK EXCHANGE
SHALL BE RESPONSIBLE FOR ADDRESSING INVESTOR GRIEVANCES ARISING FROM
APPLICATION THROUGH TRADING MEMBERS REGISTERED WITH THE STOCK EXCHANGE.

For purposes of this Issue, the term “Working Day” shall mean all days excluding Sundays or a holiday of
commercial banks in Mumbai and/or Kochi, except with reference to Issue Period, where Working Days shall
mean all days, excluding Saturdays, Sundays and public holiday in India. Furthermore, for the purpose of post
issue period, i.e. period beginning from the Issue Closure to listing of the NCDs on the Stock Exchange, Working
Day shall mean all trading days of the Stock Exchange, excluding Sundays and bank holidays in Mumbai, as per
the SEBI Circular CIR/DDHS/P/121/2018 dated August 16, 2018.

The information below is given for the benefit of the Investors. Our Company and the Members of Syndicate are
not liable for any amendment or modification or changes in applicable laws or regulations, which may occur after
the date of the Prospectus.

PROCEDURE FOR APPLICATION

Availability of the Abridged Prospectus and Application Forms

The Abridged Prospectus containing the salient features of this Prospectus together with Application Form may
be obtained from:

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(a) Our Company’s Registered Office and Corporate Office;

(b) Offices of the Lead Manager/Syndicate Member;

(c) the CRTA at the Designated RTA Locations;

(d) the CDPs at the Designated CDP Locations;

(e) Trading Members at the Broker Centres; and

(f) Designated Branches of the SCSBs.

Electronic copies of the Draft Prospectus and this Prospectus along with the downloadable version of the
Application Form will be available on the websites of the Lead Manager, the Stock Exchange, SEBI and the
SCSBs.

Electronic Application Forms may be available for download on the website of the Stock Exchange and on the
websites of the SCSBs that permit submission of Application Forms electronically. A unique application number
(“UAN”) will be generated for every Application Form downloaded from the website of the Stock Exchange. Our
Company may also provide Application Forms for being downloaded and filled at such website as it may deem
fit. In addition, brokers having online demat account portals may also provide a facility of submitting the
Application Forms virtually online to their account holders.

Trading Members of the Stock Exchange can download Application Forms from the website of the Stock
Exchange. Further, Application Forms will be provided to Trading Members of the Stock Exchange at
their request.

Who can apply?

The following categories of persons are eligible to apply in this Issue:

Category I

• Resident public financial institutions as defined in Section 2(72) of the Companies act 2013, statutory
corporations including state industrial development corporations, scheduled commercial banks, co-
operative banks and regional rural banks, and multilateral and bilateral development financial institutions
which are authorised to invest in the NCDs;

• Provident funds of minimum corpus of `2,500 lakhs, pension funds of minimum corpus of `2,500 lakhs,
superannuation funds and gratuity funds, which are authorised to invest in the NCDs;

• Alternative investment funds, subject to investment conditions applicable to them under the Securities
and Exchange Board of India (Alternative Investment Funds) Regulations, 2012;

• Resident venture capital funds registered with SEBI;

• Insurance companies registered with the IRDAI;

• National Investment Fund (set up by resolution no. F. No. 2/3/2005-DDII dated November 23, 2005 of
the Government of India and published in the Gazette of India);

• Insurance funds set up and managed by the Indian army, navy or the air force of the Union of India or
by the Department of Posts, India;

• Mutual funds registered with SEBI; and

• Systemically Important NBFCs.

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Category II

• Companies falling within the meaning of Section 2(20) of the Companies Act 2013; bodies corporate
and societies registered under the applicable laws in India and authorised to invest in the NCDs;

• Educational institutions and associations of persons and/or bodies established pursuant to or registered
under any central or state statutory enactment; which are authorised to invest in the NCDs;

• Trust including public/private charitable/religious trusts which are authorised to invest in the NCDs;

• Association of persons;

• Scientific and/or industrial research organisations, which are authorised to invest in the NCDs;

• Partnership firms in the name of the partners;

• Limited liability partnerships formed and registered under the provisions of the Limited Liability
Partnership Act, 2008 (No. 6 of 2009); and

• Resident Indian individuals and Hindu undivided families through the Karta applying for an amount
aggregating to a value exceeding `5 lakhs.

Category III*

• Resident Indian individuals; and

• Hindu undivided families through the Karta.

* applications aggregating to a value not more than `5 lakhs.

For Applicants applying for NCDs, the Registrar shall verify the above on the basis of the records provided by
the Depositories based on the DP ID and Client ID provided by the Applicants in the Application Form and
uploaded onto the electronic system of the Stock Exchange by the Members of the Syndicate or the Trading
Members, as the case may be.

Participation of any of the aforementioned categories of persons or entities is subject to the applicable
statutory and/or regulatory requirements in connection with the subscription to Indian securities by such
categories of persons or entities. Applicants are advised to ensure that Application made by them do not
exceed the investment limits or maximum number of NCDs that can be held by them under applicable
statutory and or regulatory provisions. Applicants are advised to ensure that they have obtained the
necessary statutory and/or regulatory permissions/consents/approvals in connection with applying for,
subscribing to, or seeking Allotment of NCDs pursuant to this Issue.

The Lead Manager and its respective associates and affiliates are permitted to subscribe in the Issue.

Who are not eligible to apply for NCDs?

The following categories of persons, and entities, shall not be eligible to participate in this Issue and any
Application from such persons and entities are liable to be rejected:

(a) Minors without a guardian name*(A guardian may apply on behalf of a minor. However, Application by
minors must be made through Application Forms that contain the names of both the minor Applicant and
the guardian);

(b) Foreign nationals, NRI inter-alia including any NRIs who are (i) based in the USA, and/or, (ii) domiciled
in the USA, and/or, (iii) residents/citizens of the USA, and/or, (iv) subject to any taxation laws of the
USA;

(c) Persons resident outside India and other foreign entities;

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(d) Foreign Portfolio Investors;

(e) Foreign Venture Capital Investors;

(f) Qualified Foreign Investors;

(g) Overseas Corporate Bodies; and

(h) Persons ineligible to contract under applicable statutory/regulatory requirements.

*Applicant shall ensure that guardian is competent to contract under Indian Contract Act, 1872

Based on the information provided by the Depositories, our Company shall have the right to accept Application
Forms belonging to an account for the benefit of a minor (under guardianship). In case of such Application, the
Registrar to the Issue shall verify the above on the basis of the records provided by the Depositories based on the
DP ID and Client ID provided by the Applicants in the Application Form and uploaded onto the electronic system
of the Stock Exchange.

The concept of Overseas Corporate Bodies (meaning any company, partnership firm, society and other corporate
body or overseas trust irrevocably owned/held directly or indirectly to the extent of at least 60% by NRIs), which
was in existence until 2003, was withdrawn by the Foreign Exchange Management (Withdrawal of General
Permission to Overseas Corporate Bodies) Regulations, 2003. Accordingly, OCBs are not permitted to invest in
this Issue.

Please see “- Rejection of Applications” on page 172 for information on rejection of Applications.

Method of Application

In terms of the SEBI circular CIR/DDHS/P/121/2018 dated August 16, 2018, an eligible Investor desirous of
applying in this Issue can make Applications through the ASBA mechanism only. Applicants are requested to
note that in terms of the Debt Application Circular, SEBI has mandated issuers to provide, through a recognised
stock exchange which offers such a facility, an online interface enabling direct application by investors to a public
issue of debt securities with an online payment facility (“Direct Online Application Mechanism”). In this regard,
SEBI has, through the Debt Application Circular, directed recognized Stock Exchange in India to put in necessary
systems and infrastructure for the implementation of the Debt Application Circular and the Direct Online
Application Mechanism infrastructure for the implementation of the Debt Application Circular and the Direct
Online Application Mechanism. Please note that clarifications and/or confirmations regarding the implementation
of the requisite infrastructure and facilities in relation to direct online applications and online payment facility
have been sought from the Stock Exchange.

All Applicants shall mandatorily apply in the Issue through the ASBA process only. Applicants intending to
subscribe in the Issue shall submit a duly filled Application Form to any of the Designated Intermediaries.
Applicants should submit the Application Form only at the Collection Centres, i.e. to the respective Members of
the Syndicate at the Specified Locations, the SCSBs at the Designated Branches, the registered broker at the
Broker Centres, the RTAs at the Designated RTA Locations or CDPs at the Designated CDP Locations. Kindly
note that Application Forms submitted by Applicants at the Specified Locations will not be accepted if the SCSB
with which the ASBA Account, as specified in the Application Form is maintained has not named at least one
branch at that location for the Designated Intermediaries for deposit of the Application Forms. A list of such
branches is available at [Link]

The relevant Designated Intermediaries, upon receipt of physical Application Forms from ASBA Applicants, shall
upload the details of these Application Forms to the online platform of the Stock Exchange and submit these
Application Forms with the SCSB with whom the relevant ASBA Accounts are maintained. An Applicant shall
submit the Application Form, which shall be stamped at the relevant Designated Branch of the SCSB. Application
Forms in physical mode, which shall be stamped, can also be submitted to be the Designated Intermediaries at the
Specified Locations. The SCSB shall block an amount in the ASBA Account equal to the Application Amount
specified in the Application Form.

Our Company, the Directors, affiliates, associates and their respective directors and officers, Lead Manager and
the Registrar to the Issue shall not take any responsibility for acts, mistakes, errors, omissions and commissions

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etc. in relation to ASBA Applications accepted by the Designated Intermediaries, Applications uploaded by
SCSBs, Applications accepted but not uploaded by SCSBs or Applications accepted and uploaded without
blocking funds in the ASBA Accounts. It shall be presumed that for Applications uploaded by SCSBs, the
Application Amount has been blocked in the relevant ASBA Account. Further, all grievances against Designated
Intermediaries in relation to this Issue should be made by Applicants directly to the relevant Stock Exchange.

APPLICATIONS FOR ALLOTMENT OF NCDs

Details for Applications by certain categories of Applicants including documents to be submitted are summarized
below.

Applications by Mutual Funds

Pursuant to the SEBI circular SEBI/HO/IMD/DF2/CIR/P/2016/35 dated February 15, 2016 (“SEBI Circular
2016”), mutual funds are required to ensure that the total exposure of debt schemes of mutual funds in a particular
sector shall not exceed 25.0% of the net assets value of the scheme. Further, the additional exposure limit provided
for financial services sector towards HFCs is reduced from 10.0% of net assets value to 5.0% of net assets value
and single issuer limit is reduced to 10.0% of net assets value (extendable to 12% of net assets value, after trustee
approval). The SEBI Circular 2016 also introduces group level limits for debt schemes and the ceiling be fixed at
20.0% of net assets value extendable to 25.0% of net assets value after trustee approval.

A separate Application can be made in respect of each scheme of an Indian mutual fund registered with SEBI and
such Applications shall not be treated as multiple Applications. Applications made by the AMCs or custodians of
a mutual fund shall clearly indicate the name of the concerned scheme for which Application is being made. In
case of Applications made by Mutual Fund registered with SEBI, a certified copy of their SEBI registration
certificate must be submitted with the Application Form. Failing this, our Company reserves the right to accept or
reject any Application in whole or in part, in either case, without assigning any reason therefor.

Application by Systemically Important Non-Banking Financial Companies

Systemically Important Non- Banking Financial Company, a non-banking financial company registered with the
Reserve Bank of India and having a net-worth of more than five hundred crore rupees as per the last audited
financial statements can apply in this Issue based on their own investment limits and approvals. The Application
Form must be accompanied by a certified copy of the certificate of registration issued by the RBI, a certified copy
of its last audited financial statements on a standalone basis and a net worth certificate from its statutory auditor(s).
Failing this, our Company reserves the right to accept or reject any Application in whole or in part, in either case,
without assigning any reason therefor.

Application by commercial banks, co-operative banks and regional rural banks

Commercial banks, co-operative banks and regional rural banks can apply in this Issue based on their own
investment limits and approvals. The Application Form must be accompanied by certified true copies of their (i)
the certificate of registration issued by RBI, and (ii) the approval of such banking company’s investment
committee is required to be attached to the Application Form. Failing this, our Company reserves the right to
accept or reject any Application in whole or in part, in either case, without assigning any reason therefor.

Pursuant to SEBI Circular no. CIR/CFD/DIL/1/2013 dated January 2, 2013, SCSBs making Applications
on their own account using ASBA Facility, should have a separate account in their own name with any
other SEBI registered SCSB. Further, such account shall be used solely for the purpose of making
Application in public issues and clear demarcated funds should be available in such account for
applications.

Application by Insurance Companies

In case of Applications made by insurance companies registered with the Insurance Regulatory and Development
Authority of India (“IRDAI”), a certified copy of certificate of registration issued by IRDAI must be lodged along
with Application Form. Failing this, our Company reserves the right to accept or reject any Application in whole
or in part, in either case, without assigning any reason, therefore.

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Insurance companies participating in this Issue shall comply with all applicable regulations, guidelines and
circulars issued by the IRDAI from time to time to time including the IRDA (Investment) Regulations, 2000.

Application by Indian Alternative Investment Funds

Applications made by Alternative Investment Funds eligible to invest in accordance with the Securities and
Exchange Board of India (Alternative Investment Fund) Regulations, 2012, as amended (the “SEBI AIF
Regulations”) for Allotment of the NCDs must be accompanied by certified true copies of SEBI registration
certificate. The Alternative Investment Funds shall at all times comply with the requirements applicable to it under
the SEBI AIF Regulations and the relevant notifications issued by SEBI. Failing this, our Company reserves the
right to accept or reject any Application in whole or in part, in either case, without assigning any reason, therefor.

Applications by associations of persons and/or bodies established pursuant to or registered under any
central or state statutory enactment

In case of Applications made by ‘Associations of Persons’ and/or bodies established pursuant to or registered
under any central or state statutory enactment, must submit a (i) certified copy of the certificate of registration or
proof of constitution, as applicable, (ii) power of attorney, if any, in favour of one or more persons thereof, (iii)
such other documents evidencing registration thereof under applicable statutory/regulatory requirements. Further,
any trusts applying for NCDs pursuant to this Issue must ensure that (a) they are authorized under applicable
statutory/regulatory requirements and their constitution instrument to hold and invest in debentures, (b) they have
obtained all necessary approvals, consents or other authorisations, which may be required under applicable
statutory and/or regulatory requirements to invest in debentures, and (c) Applications made by them do not exceed
the investment limits or maximum number of NCDs that can be held by them under applicable statutory and or
regulatory provisions. Failing this, our Company reserves the right to accept or reject any Applications in whole
or in part, in either case, without assigning any reason therefor.

Applications by Trusts

In case of Applications made by trusts, settled under the Indian Trusts Act, 1882, as amended, or any other
statutory and/or regulatory provision governing the settlement of trusts in India, must submit a (i) certified copy
of the registered instrument for creation of such trust, (ii) power of attorney, if any, in favour of one or more
trustees thereof, (iii) such other documents evidencing registration thereof under applicable statutory/regulatory
requirements. Further, any trusts applying for NCDs pursuant to this Issue must ensure that (a) they are authorized
under applicable statutory/regulatory requirements and their constitution instrument to hold and invest in
debentures, (b) they have obtained all necessary approvals, consents or other authorisations, which may be
required under applicable statutory and/or regulatory requirements to invest in debentures, and (c) Applications
made by them do not exceed the investment limits or maximum number of NCDs that can be held by them under
applicable statutory and or regulatory provisions. Failing this, our Company reserves the right to accept or reject
any Applications in whole or in part, in either case, without assigning any reason therefor.

Applications by Public Financial Institutions or Statutory Corporations, which are authorised to invest in
the NCDs

The Application must be accompanied by certified true copies of: (i) any act/ rules under which they are
incorporated; (ii) board resolution authorising investments; and (iii) specimen signature of authorised person.
Failing this, our Company reserves the right to accept or reject any Applications in whole or in part, in either case,
without assigning any reason therefor.

Applications by Provident Funds, Pension Funds, Superannuation Funds and Gratuity Fund, which are
authorized to invest in the NCDs

The Application must be accompanied by certified true copies of incorporation/ registration under any act/rules
under which they are incorporated. Failing this, our Company reserves the right to accept or reject any Application
in whole or in part, in either case, without assigning any reason therefor.

Applications by National Investment Fund

The Application must be accompanied by certified true copies of: (i) resolution authorising investment and
containing operating instructions; and (ii) specimen signature of authorized person. Failing this, our Company

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reserves the right to accept or reject any Application in whole or in part, in either case, without assigning any
reason therefor.

Companies, bodies corporate and societies registered under the applicable laws in India

The Application must be accompanied by certified true copies of the registration under the act/ rules under which
they are incorporated. Failing this, our Company reserves the right to accept or reject any Applications in whole
or in part, in either case, without assigning any reason therefor.

Applications by Indian Scientific and/or industrial research organizations, which are authorized to invest
in the NCDs

The Application must be accompanied by certified true copies of the registration under the act/ rules under which
they are incorporated. Failing this, our Company reserves the right to accept or reject any Applications in whole
or in part, in either case, without assigning any reason therefor.

Applications by Partnership firms formed under applicable Indian laws in the name of the partners and
Limited Liability Partnerships formed and registered under the provisions of the Limited Liability
Partnership Act, 2008

The Application must be accompanied by certified true copies of certified copy of certificate of the partnership
deed or registration issued under the Limited Liability Partnership Act, 2008, as applicable. Failing this, our
Company reserves the right to accept or reject any Applications in whole or in part, in either case, without
assigning any reason therefor.

Applications under Power of Attorney

In case of Applications made pursuant to a power of attorney by Applicants who are Institutional Investors or
Non-Institutional Investors, a certified copy of the power of attorney or the relevant resolution or authority, as the
case may be, with a certified copy of the memorandum of association and articles of association and/or bye laws
must be submitted with the Application Form. In case of Applications made pursuant to a power of attorney by
Applicants, a certified copy of the power of attorney must be submitted with the Application Form. Failing this,
our Company reserves the right to accept or reject any Application in whole or in part, in either case, without
assigning any reason therefor. Our Company, in its absolute discretion, reserves the right to relax the above
condition of attaching the power of attorney with the Application Forms subject to such terms and conditions that
our Company and the Lead Manager may deem fit.

Brokers having online demat account portals may also provide a facility of submitting the Application Forms
online to their account holders. Under this facility, a broker receives an online instruction through its portal from
the Applicant for making an Application on his/ her behalf. Based on such instruction, and a power of attorney
granted by the Applicant to authorise the broker, the broker makes an Application on behalf of the Applicant.

APPLICATIONS FOR ALLOTMENT OF NCDs

This section is for the information of the Applicants proposing to subscribe to the Issue. The Lead Manager and
our Company are not liable for any amendments or modifications or changes in applicable laws or regulations,
which may occur after the date of the Prospectus. Investors are advised to make their independent investigations
and to ensure that the Application Form is correctly filled up.

Our Company, our Directors, affiliates, associates and their respective directors and officers, the Lead Manager
and the Registrar to the Issue shall not take any responsibility for acts, mistakes, errors, omissions and
commissions etc. in relation to Applications accepted by and/or uploaded by and/or accepted but not uploaded by
Trading Members, registered brokers, CDPs, RTAs and SCSBs who are authorised to collect Application Forms
from the Applicants in the Issue, or Applications accepted and uploaded without blocking funds in the ASBA
Accounts by SCSBs. It shall be presumed that for Applications uploaded by SCSBs, the Application Amount
payable on Application has been blocked in the relevant ASBA Account.

The list of branches of the SCSBs at the Specified Locations named by the respective SCSBs to receive
Application Forms from the Members of the Syndicate is available on the website of SEBI
([Link] and updated from time to time or any such other website as may be prescribed by SEBI

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from time to time. For more information on such branches collecting Application Forms from the Syndicate at
Specified Locations, see the website of the SEBI ([Link] as updated from time to time or any
such other website as may be prescribed by SEBI from time to time. The list of registered brokers at the Broker
Centres, CDPs at the Designated CDP Locations or the RTAs at the Designated RTA Locations, respective lists
of which, including details such as address and telephone number, are available at the website of the Stock
Exchange at [Link]. The list of branches of the SCSBs at the Broker Centres, named by the respective
SCSBs to receive deposits of the Application Forms from the registered brokers will be available on the website
of the SEBI ([Link]) and updated from time to time.

Submission of Applications

Applications can be submitted through either of the following modes:

(a) Physically or electronically to the Designated Branches of the SCSB(s) with whom an Applicant’s ASBA
Account is maintained. In case of Application in physical mode, the Applicant shall submit the
Application Form at the relevant Designated Branch of the SCSB(s). The Designated Branch shall verify
if sufficient funds equal to the Application Amount are available in the ASBA Account and shall also
verify that the signature on the Application Form matches with the Investor’s bank records, as mentioned
in the Application Form, prior to uploading such Application into the electronic system of the Stock
Exchange. If sufficient funds are not available in the ASBA Account, the respective Designated Branch
shall reject such Application and shall not upload such Application in the electronic system of the Stock
Exchange. If sufficient funds are available in the ASBA Account, the Designated Branch shall block an
amount equivalent to the Application Amount and upload details of the Application in the electronic
system of the Stock Exchange. The Designated Branch of the SCSBs shall stamp the Application Form
and issue an acknowledgement as proof of having accepted the Application.

In case of Application being made in the electronic mode, the Applicant shall submit the Application
either through the internet banking facility available with the SCSB, or such other electronically enabled
mechanism for application and blocking funds in the ASBA Account held with SCSB, and accordingly
registering such Application.

(b) Physically through the Designated Intermediaries at the respective Collection Centres. Kindly note that
above Applications submitted to any of the Designated Intermediaries will not be accepted if the SCSB
where the ASBA Account is maintained, as specified in the Application Form, has not named at least
one branch at that Collection Center where the Application Form is submitted (a list of such branches is
available at [Link]

Upon receipt of the Application Form by the Designated Intermediaries, an acknowledgement shall be issued by
the relevant Designated Intermediary, giving the counter foil of the Application Form to the Applicant as proof of
having accepted the Application. Thereafter, the details of the Application shall be uploaded in the electronic
system of the Stock Exchange and the Application Form shall be forwarded to the relevant branch of the SCSB,
in the relevant Collection Center, named by such SCSB to accept such Applications from the Designated
Intermediaries (a list of such branches is available at [Link] Upon receipt of the Application
Form, the relevant branch of the SCSB shall perform verification procedures including verification of the
Applicant’s signature with his bank records and check if sufficient funds equal to the Application Amount are
available in the ASBA Account, as mentioned in the Application Form. If sufficient funds are not available in the
ASBA Account, the relevant Application Form is liable to be rejected. If sufficient funds are available in the
ASBA Account, the relevant branch of the SCSB shall block an amount equivalent to the Application Amount
mentioned in the Application Form. The Application Amount shall remain blocked in the ASBA Account until
approval of the Basis of Allotment and consequent transfer of the amount against the Allotted NCDs to the Public
Issue Account(s), or until withdrawal/failure of this Issue or until withdrawal/ rejection of the Application Form,
as the case may be.

Applicants must note that:

(a) Application Forms will be available with the Designated Branches of the SCSBs and with the Designated
Intermediaries at the respective Collection Centres; and electronic Application Forms will be available
on the websites of the SCSBs and the Stock Exchange at least one day prior to the Issue Opening Date.
Physical Application Forms will also be provided to the Trading Members of the Stock Exchange at their
request. The Application Forms would be serially numbered. Further, the SCSBs will ensure that the

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Prospectus is made available on their websites. The physical Application Form submitted to the
Designated Intermediaries shall bear the stamp of the relevant Designated Intermediary. In the event the
Application Form does not bear any stamp, the same shall be liable to be rejected.

(b) The Designated Branches of the SCSBs shall accept Application Forms directly from Applicants only
during the Issue Period. The SCSBs shall not accept any Application Forms directly from Applicants
after the closing time of acceptance of Applications on the Issue Closing Date. However, the relevant
branches of the SCSBs at Specified Locations can accept Application Forms from the Designated
Intermediaries, after the closing time of acceptance of Applications on the Issue Closing Date, if the
Applications have been uploaded. For further information on the Issue programme, please see “General
Information – Issue Programme” on page 43. Physical Application Forms directly submitted to SCSBs
should bear the stamp of SCSBs, if not, the same are liable to be rejected.

Please note that Applicants can make an Application for Allotment of NCDs in the dematerialised form
only.

INSTRUCTIONS FOR FILLING-UP THE APPLICATION FORM

General Instructions

A. General instructions for completing the Application Form

• Applications must be made in prescribed Application Form only;

• Application Forms must be completed in BLOCK LETTERS IN ENGLISH, as per the instructions
contained in the Prospectus and the Application Form;

• If the Application is submitted in joint names, the Application Form should contain only the name of the
first Applicant whose name should also appear as the first holder of the depository account held in joint
names;

• Applications should be in single or joint names and not exceeding three names, and in the same order as
their Depository Participant details (in case of Applicants applying for Allotment of the Bonds in
dematerialised form) and Applications should be made by Karta in case the Applicant is an HUF. Please
ensure that such Applications contain the PAN of the HUF and not of the Karta;

• Applicants must provide details of valid and active DP ID, Client ID and PAN clearly and without error.
On the basis of such Applicant’s active DP ID, Client ID and PAN provided in the Application Form,
and as entered into the electronic Application system of the Stock Exchange by SCSBs, the Designated
Intermediaries, the Registrar will obtain from the Depository the Demographic Details. Invalid accounts,
suspended accounts or where such account is classified as invalid or suspended may not be considered
for Allotment of the NCDs;

• Applications must be for a minimum of 10 NCDs and in multiples of one NCD thereafter. For the purpose
of fulfilling the requirement of minimum application size of 10 NCDs, an Applicant may choose to apply
for 10 NCDs of the same option or across different option. Applicants may apply for one or more option
of NCDs Applied for in a single Application Form;

• If the ASBA Account holder is different from the Applicant, the Application Form should be signed by
the ASBA Account holder also, in accordance with the instructions provided in the Application Form;

• If the depository account is held in joint names, the Application Form should contain the name and PAN
of the person whose name appears first in the depository account and signature of only this person would
be required in the Application Form. This Applicant would be deemed to have signed on behalf of joint
holders and would be required to give confirmation to this effect in the Application Form;

• Applications should be made by Karta in case of HUFs. Applicants are required to ensure that the PAN
details of the HUF are mentioned and not those of the Karta;

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• Thumb impressions and signatures other than in English/Hindi/Gujarati/Marathi or any other languages
specified in the 8th Schedule of the Constitution needs to be attested by a Magistrate or Notary Public or
a Special Executive Magistrate under his/her seal;

• The Designated Intermediaries or the Designated Branches of the SCSBs, as the case may be, will
acknowledge the receipt of the Application Forms by stamping and returning to the Applicants the
Acknowledgement Slip. This Acknowledgement Slip will serve as the duplicate of the Application Form
for the records of the Applicant;

• Applicants must ensure that the requisite documents are attached to the Application Form prior to
submission and receipt of acknowledgement from the relevant Designated Intermediaries or the
Designated Branch of the SCSBs, as the case may be;

• Every Applicant should hold valid Permanent Account Number and mention the same in the Application
Form;

• All Applicants are required to tick the relevant column of “Category of Investor” in the Application
Form; and

• All Applicants should correctly mention the ASBA Account number and ensure that funds equal to the
Application Amount are available in the ASBA Account before submitting the Application Form to the
Designated Branch and also ensure that the signature in the Application Form matches with the signature
in Applicant’s bank records, otherwise the Application is liable to be rejected.

The option, mode of allotment, PAN, demat account no. etc. should be captured by the relevant Designated
Intermediaries in the data entries as such data entries will be considered for Allotment.

Applicants should note that neither the Designated Intermediaries nor the SCSBs, as the case may be, will
be liable for error in data entry due to incomplete or illegible Application Forms.

B. Applicant’s Beneficiary Account Details

Applicants must mention their DP ID and Client ID in the Application Form and ensure that the name provided
in the Application Form is exactly the same as the name in which the Beneficiary Account is held. In case the
Application Form is submitted in the first Applicant’s name, it should be ensured that the Beneficiary Account is
held in the same joint names and in the same sequence in which they appear in the Application Form. In case the
DP ID, Client ID and PAN mentioned in the Application Form and entered into the electronic system of the Stock
Exchange do not match with the DP ID, Client ID and PAN available in the Depository database or in case PAN
is not available in the Depository database, the Application Form is liable to be rejected. Further, Application
Forms submitted by Applicants whose beneficiary accounts are inactive, will be rejected.

On the basis of the Demographic Details as appearing on the records of the DP, the Registrar to the Issue will take
steps towards demat credit of NCDs. Hence, Applicants are advised to immediately update their Demographic
Details as appearing on the records of the DP and ensure that they are true and correct, and carefully fill in their
Beneficiary Account details in the Application Form. Failure to do so could result in delays in demat credit and
neither our Company, Designated Intermediaries, SCSBs, Registrar to the Issue nor the Stock Exchange will bear
any responsibility or liability for the same.

In case of Applications made under power of attorney, our Company in its absolute discretion, reserves the right
to permit the holder of power of attorney to request the Registrar that for the purpose of printing particulars on
the Allotment Advice, the Demographic Details obtained from the Depository of the Applicant shall be used.

By signing the Application Form, the Applicant would have deemed to have authorized the Depositories to
provide, upon request, to the Registrar to the Issue, the required Demographic Details as available on its records.
The Demographic Details given by Applicant in the Application Form would not be used for any other purpose
by the Registrar to the Issue except in relation to this Issue. Allotment Advice would be mailed by speed post or
registered post at the address of the Applicants as per the Demographic Details received from the Depositories.
Applicants may note that delivery of Allotment Advice may get delayed if the same once sent to the address
obtained from the Depositories are returned undelivered. Further, please note that any such delay shall be at such
Applicants’ sole risk and neither our Company, Registrar to the Issue, Public Issue Account Bank, nor the Lead

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Manager shall be liable to compensate the Applicant for any losses caused to the Applicants due to any such delay
or liable to pay any interest for such delay. In case of refunds through electronic modes as detailed in the
Prospectus, refunds may be delayed if bank particulars obtained from the Depository Participant are incorrect.

With effect from August 16, 2010, the beneficiary accounts of Applicants for whom PAN details have not been
verified shall be suspended for credit and no credit of NCDs pursuant to this Issue will be made into the accounts
of such Applicants. Application Forms submitted by Applicants whose beneficiary accounts are inactive shall be
rejected. Furthermore, in case no corresponding record is available with the Depositories, which matches the three
parameters, namely, DP ID, Client ID and PAN, then such Application are liable to be rejected.

C. Permanent Account Number

The Applicant should mention his or her Permanent Account Number allotted under the IT Act. For minor
Applicants, applying through the guardian, it is mandatory to mention the PAN of the minor Applicant. However,
Applications on behalf of the Central or State Government officials and the officials appointed by the courts in
terms of a SEBI circular dated June 30, 2008 and Applicants residing in the state of Sikkim who in terms of a
SEBI circular dated July 20, 2006 may be exempt from specifying their PAN for transacting in the securities
market. In accordance with Circular No. MRD/DOP/Cir-05/2007 dated April 27, 2007 issued by SEBI, the PAN
would be the sole identification number for the participants transacting in the securities market, irrespective of the
amount of transaction. Any Application Form, without the PAN is liable to be rejected, irrespective of the amount
of transaction. It is to be specifically noted that the Applicants should not submit the GIR number instead of the
PAN as the Application is liable to be rejected on this ground.

However, the exemption for the Central or State Government and the officials appointed by the courts and for
investors residing in the State of Sikkim is subject to the Depository Participants’ verifying the veracity of such
claims by collecting sufficient documentary evidence in support of their claims. At the time of ascertaining the
validity of these Applications, the Registrar to the Issue will check under the Depository records for the
appropriate description under the PAN Field i.e. either Sikkim category or exempt category.

D. Joint Applications

Applications may be made in single or joint names (not exceeding three). In the case of joint Applications all
interest / redemption amount payments will be made out in favour of the first Applicant. All communications will
be addressed to the first named Applicant whose name appears in the Application Form and at the address
mentioned therein. If the depository account is held in joint names, the Application Form should contain the name
and PAN of the person whose name appears first in the depository account and signature of only this person would
be required in the Application Form. This Applicant would be deemed to have signed on behalf of joint holders
and would be required to give confirmation to this effect in the Application Form.

E. Additional/Multiple Applications

An Applicant is allowed to make one or more Applications for the NCDs for the same or other option of NCDs,
subject to a minimum Application size as specified in the Prospectus and in multiples of thereafter as specified in
the Prospectus. Any Application for an amount below the aforesaid minimum Application size will be deemed as
an invalid Application and shall be rejected. However, multiple Applications by the same individual Applicant
aggregating to a value exceeding `5 lakhs shall be deemed such individual Applicant to be an HNI Applicant and
all such Applications shall be grouped in the HNI Portion, for the purpose of determining the Basis of Allotment
to such Applicant. However, any Application made by any person in his individual capacity and an Application
made by such person in his capacity as a Karta of a Hindu Undivided family and/or as Applicant (second or third
Applicant), shall not be deemed to be a multiple Application. For the purposes of allotment of NCDs under this
Issue, Applications shall be grouped based on the PAN, i.e. Applications under the same PAN shall be grouped
together and treated as one Application. Two or more Applications will be deemed to be multiple Applications if
the sole or first Applicant is one and the same. For the sake of clarity, two or more applications shall be deemed
to be a multiple Application for the aforesaid purpose if the PAN number of the sole or the first Applicant is one
and the same.

Do’s and Don’ts

Applicants are advised to take note of the following while filling and submitting the Application Form:

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Do’s

1. Check if you are eligible to apply as per the terms of the Prospectus and applicable law.

2. Read all the instructions carefully and complete the Application Form in the prescribed form.

3. Ensure that you have obtained all necessary approvals from the relevant statutory and/or regulatory authorities
to apply for, subscribe to and/or seek Allotment of NCDs pursuant to this Issue.

4. Ensure that the DP ID, the Client ID and the PAN mentioned in the Application Form, which shall be entered
into the electronic system of the Stock Exchange are correct and match with the DP ID, Client ID and PAN
available in the Depository database. Ensure that the DP ID and Client ID are correct and beneficiary account
is activated. The requirement for providing Depository Participant details is mandatory for all Applicants.

5. Ensure that you have mentioned the correct ASBA Account number in the Application Form.

6. Ensure that the Application Form is signed by the ASBA Account holder in case the Applicant is not the
ASBA account holder.

7. Ensure that you have funds equal to the Application Amount in the ASBA Account before submitting the
Application Form to the respective Designated Branch of the SCSB, or to the Designated Intermediaries, as
the case may be.

8. Ensure that the Application Forms are submitted at the Designated Branches of SCSBs or the Collection
Centres provided in the Application Forms, bearing the stamp of the relevant Designated
Intermediary/Designated Branch of the SCSB.

9. Before submitting the Application Form with the Designated Intermediaries ensure that the SCSB, whose
name has been filled in the Application Form, has named a branch in that relevant Collection Centre.

10. Ensure that you have been given an acknowledgement as proof of having accepted the Application Form.

11. Ensure that signatures other than in the languages specified in the Eighth Schedule to the Constitution of India
is attested by a Magistrate or a Notary Public or a Special Executive Magistrate under official seal.

12. In case of an HUF applying through its Karta, the Applicant is required to specify the name of an Applicant
in the Application Form as ‘XYZ Hindu Undivided Family applying through PQR’, where PQR is the name
of the Karta. However, the PAN number of the HUF should be mentioned in the Application Form and not
that of the Karta.

13. Ensure that the Applications are submitted to the Designated Intermediaries or Designated Branches of the
SCSBs, as the case may be, before the closure of application hours on the Issue Closing Date. For further
information on the Issue programme, please see “General Information – Issue Programme” on page 43.

14. Permanent Account Number: Except for Application (i) on behalf of the Central or State Government and
officials appointed by the courts, and (ii) (subject to SEBI circular dated April 3, 2008) from the residents of
the state of Sikkim, each of the Applicants should provide their PAN. Application Forms in which the PAN
is not provided will be rejected. The exemption for the Central or State Government and officials appointed
by the courts and for investors residing in the State of Sikkim is subject to (a) the Demographic Details
received from the respective depositories confirming the exemption granted to the beneficiary owner by a
suitable description in the PAN field and the beneficiary account remaining in “active status”; and (b) in the
case of residents of Sikkim, the address as per the Demographic Details evidencing the same.

15. Ensure that if the depository account is held in joint names, the Application Form should contain the name
and PAN of the person whose name appears first in the depository account and signature of only this person
would be required in the Application Form. This Applicant would be deemed to have signed on behalf of
joint holders and would be required to give confirmation to this effect in the Application Form.

16. All Applicants should choose the relevant option in the column “Category of Investor” in the Application
Form.

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17. Choose and mark the option of NCDs in the Application Form that you wish to apply for.

In terms of SEBI Circular no. CIR/CFD/DIL/1/2013 dated January 2, 2013, SCSBs making applications on their
own account using ASBA facility, should have a separate account in their own name with any other SEBI
registered SCSB. Further, such account shall be used solely for the purpose of making application in public issues
and clear demarcated funds should be available in such account for Applications.

Don’ts:

1. Do not apply for lower than the minimum Application size.

2. Do not pay the Application Amount in cash, by cheque, by money order or by postal order or by stock invest.

3. Do not send Application Forms by post. Instead submit the same to the Designated Intermediaries or
Designated Branches of the SCSBs, as the case may be.
4. Do not submit the Application Form to any non-SCSB bank or our Company.

5. Do not apply through an Application Form that does not have the stamp of the relevant Designated
Intermediary or the Designated Branch of the SCSB, as the case may be.

6. Do not fill up the Application Form such that the NCDs applied for exceeds the Issue Size and/or investment
limit or maximum number of NCDs that can be held under the applicable laws or regulations or maximum
amount permissible under the applicable regulations.

7. Do not submit the GIR number instead of the PAN as the Application is liable to be rejected on this ground.

8. Do not submit incorrect details of the DP ID, Client ID and PAN or provide details for a beneficiary account
which is suspended or for which details cannot be verified by the Registrar to the Issue.

9. Do not submit the Application Form without ensuring that funds equivalent to the entire Application Amount
are available for blocking in the relevant ASBA Account.

10. Do not submit Applications on plain paper or on incomplete or illegible Application Forms.

11. Do not apply if you are not competent to contract under the Indian Contract Act, 1872.

12. Do not submit an Application in case you are not eligible to acquire NCDs under applicable law or your
relevant constitutional documents or otherwise.

13. Do not submit Applications to a Designated Intermediary at a location other than Collection Centres.

14. Do not submit an Application that does not comply with the securities law of your respective jurisdiction.

15. Do not apply if you are a person ineligible to apply for NCDs under this Issue including Applications by
Persons Resident Outside India, NRI (inter-alia including NRIs who are (i) based in the USA, and/or, (ii)
domiciled in the USA, and/or, (iii) residents/citizens of the USA, and/or, (iv) subject to any taxation laws of
the USA).

16. Do not make an Application of the NCD on multiple copies taken of a single form.

17. Payment of Application Amount in any mode other than through blocking of Application Amount in the
ASBA Accounts shall not be accepted in the Issue.

18. Do not submit more than five Application Forms per ASBA Account.

Kindly note that Applications submitted to the Designated Intermediaries will not be accepted if the SCSB
where the ASBA Account, as specified in the Application Form, is maintained has not named at least one
branch at that location for the Designated Intermediaries, to deposit such Application Forms (A list of such
branches is available at [Link]

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Please see “- Rejection of Applications” on page 172 for information on rejection of Applications.

TERMS OF PAYMENT

The Application Forms will be uploaded onto the electronic system of the Stock Exchange and deposited with the
relevant branch of the SCSB at the Collection Centres, named by such SCSB to accept such Applications from
the Designated Intermediaries, as the case may be (a list of such branches is available at [Link]
The relevant branch of the SCSB shall perform verification procedures and block an amount in the ASBA Account
equal to the Application Amount specified in the Application.

The entire Application Amount for the NCDs is payable on Application only. The relevant SCSB shall block an
amount equivalent to the entire Application Amount in the ASBA Account at the time of upload of the Application
Form. In case of Allotment of lesser number of NCDs than the number applied, the Registrar to the Issue shall
instruct the SCSBs to unblock the excess amount in the ASBA Account.

For Applications submitted directly to the SCSBs, the relevant SCSB shall block an amount in the ASBA Account
equal to the Application Amount specified in the Application, before entering the Application into the electronic
system of the Stock Exchange. SCSBs may provide the electronic mode of application either through an internet
enabled application and banking facility or such other secured, electronically enabled mechanism for application
and blocking of funds in the ASBA Account.

Applicants should ensure that they have funds equal to the Application Amount in the ASBA Account
before submitting the Application to the Designated Intermediaries or to the Designated Branches of the
SCSBs. An Application where the corresponding ASBA Account does not have sufficient funds equal to the
Application Amount at the time of blocking the ASBA Account is liable to be rejected.

The Application Amount shall remain blocked in the ASBA Account until approval of the Basis of Allotment and
consequent transfer of the amount against the Allotted NCDs to the Public Issue Account(s), or until withdrawal/
failure of this Issue or until withdrawal/ rejection of the Application Form, as the case may be. Once the Basis of
Allotment is approved, and upon receipt of intimation from the Registrar, the controlling branch of the SCSB
shall, on the Designated Date, transfer such blocked amount from the ASBA Account to the Public Issue Account.
The balance amount remaining after the finalisation of the Basis of Allotment shall be unblocked by the SCSBs
on the basis of the instructions issued in this regard by the Registrar to the respective SCSB within six Working
Days of the Issue Closing Date. The Application Amount shall remain blocked in the ASBA Account until transfer
of the Application Amount to the Public Issue Account, or until withdrawal/ failure of this Issue or until rejection
of the Application, as the case may be.

SUBMISSION OF COMPLETED APPLICATION FORMS

Mode of Submission of
To whom the Application Form has to be submitted
Application Forms
ASBA Applications (i) If using physical Application Form, (a) to the Designated
Intermediaries at relevant Collection Centres, or (b) to the Designated
Branches of the SCSBs where the ASBA Account is maintained; or

(ii) If using electronic Application Form, to the SCSBs, electronically

through internet banking facility, if available.

No separate receipts will be issued for the Application Amount payable on submission of Application Form.
However, the Designated Intermediaries will acknowledge the receipt of the Application Forms by stamping the
date and returning to the Applicants an Acknowledgement Slips which will serve as a duplicate Application Form
for the records of the Applicant.

Electronic Registration of Applications

(a) The Designated Intermediaries and Designated Branches of the SCSBs, as the case may be, will register the
Applications using the on-line facilities of the Stock Exchange. The Members of Syndicate, our Company
and the Registrar to the Issue are not responsible for any acts, mistakes or errors or omission and

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commissions in relation to, (i) the Applications accepted by the SCSBs, (ii) the Applications uploaded
by the SCSBs, (iii) the Applications accepted but not uploaded by the SCSBs, (iv) with respect to
Applications accepted and uploaded by the SCSBs without blocking funds in the ASBA Accounts, or
(v) any Applications accepted and uploaded and/or not uploaded by the Trading Members of the Stock
Exchange.

In case of apparent data entry error by the Designated Intermediaries or Designated Branches of the SCSBs,
as the case may be, in entering the Application Form number in their respective schedules other things
remaining unchanged, the Application Form may be considered as valid and such exceptions may be recorded
in minutes of the meeting submitted to the Designated Stock Exchange. However, the option, mode of
allotment, PAN, demat account no. etc. should be captured by the relevant Designated Intermediaries or
Designated Branches of the SCSBs in the data entries as such data entries will be considered for
Allotment/rejection of Application.

(b) The Stock Exchange will offer an electronic facility for registering Applications for this Issue. This facility
will be available on the terminals of Designated Intermediaries and the SCSBs during the Issue Period. The
Designated Intermediaries can also set up facilities for off-line electronic registration of Applications subject
to the condition that they will subsequently upload the off-line data file into the on-line facilities for
Applications on a regular basis, and before the expiry of the allocated time on this Issue Closing Date. On the
Issue Closing Date, the Designated Intermediaries and the Designated Branches of the SCSBs shall upload
the Applications till such time as may be permitted by the Stock Exchange. This information will be available
with the Designated Intermediaries and the Designated Branches of the SCSBs on a regular basis. Applicants
are cautioned that a high inflow of high volumes on the last day of the Issue Period may lead to some
Applications received on the last day not being uploaded and such Applications will not be considered for
allocation. For further information on the Issue programme, please see “General Information – Issue
Programme” on page 43.

(c) With respect to Applications submitted directly to the SCSBs at the time of registering each Application, the
Designated Branches of the SCSBs shall enter the requisite details of the Applicants in the on-line system
including:

• Application Form number

• PAN (of the first Applicant, in case of more than one Applicant)

• Investor category and sub-category

• DP ID

• Client ID

• Option of NCDs applied for

• Number of NCDs Applied for in each option of NCD

• Price per NCD

• Bank code for the SCSB where the ASBA Account is maintained

• Bank account number

• Location

• Application amount

(d) With respect to Applications submitted to the Designated Intermediaries, at the time of registering each
Application, the requisite details of the Applicants shall be entered in the on-line system including:

• Application Form number

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• PAN (of the first Applicant, in case of more than one Applicant)

• Investor category and sub-category

• DP ID

• Client ID

• Option of NCDs applied for

• Number of NCDs Applied for in each option of NCD

• Price per NCD

• Bank code for the SCSB where the ASBA Account is maintained

• Bank account number

• Location

• Application amount

(e) A system generated acknowledgement (TRS) will be given to the Applicant as a proof of the registration of
each Application. It is the Applicant’s responsibility to obtain the acknowledgement from the Designated
Intermediaries and the Designated Branches of the SCSBs, as the case may be. The registration of the
Application by the Designated Intermediaries and the Designated Branches of the SCSBs, as the case may
be, does not guarantee that the NCDs shall be allocated/ Allotted by our Company. The acknowledgement
will be non-negotiable and by itself will not create any obligation of any kind.

(f) Applications can be rejected on the technical grounds listed below or if all required information is not
provided or the Application Form is incomplete in any respect.

(g) The permission given by the Stock Exchange to use its network and software of the online system should not
in any way be deemed or construed to mean that the compliance with various statutory and other requirements
by our Company, the Lead Manager are cleared or approved by the Stock Exchange; nor does it in any manner
warrant, certify or endorse the correctness or completeness of any of the compliance with the statutory and
other requirements nor does it take any responsibility for the financial or other soundness of our Company,
the management or any scheme or project of our Company; nor does it in any manner warrant, certify or
endorse the correctness or completeness of any of the contents of this Prospectus; nor does it warrant that the
NCDs will be listed or will continue to be listed on the Stock Exchange

(h) Only Applications that are uploaded on the online system of the Stock Exchange shall be considered
for allocation/ Allotment. The Designated Intermediaries and the Designated Branches of the SCSBs shall
capture all data relevant for the purposes of finalizing the Basis of Allotment while uploading Application
data in the electronic systems of the Stock Exchange. In order that the data so captured is accurate the
Designated Intermediaries and the Designated Branches of the SCSBs will be given up to one Working Day
after the Issue Closing Date to modify/ verify certain selected fields uploaded in the online system during the
Issue Period after which the data will be sent to the Registrar for reconciliation with the data available with
the NSDL and CDSL.

REJECTION OF APPLICATIONS

Applications would be liable to be rejected on the technical grounds listed below or if all required information is
not provided or the Application Form is incomplete in any respect. The Board of Directors and/or the Debenture
Committee thereof, reserves its full, unqualified and absolute right to accept or reject any Application in whole or
in part and in either case without assigning any reason thereof.

Application may be rejected on one or more technical grounds, including but not restricted to:

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(a) Application by persons not competent to contract under the Indian Contract Act, 1872, as amended, (other
than minors having valid Depository Account as per Demographic Details provided by Depositories);

(b) Applications accompanied by cash, draft, cheques, money order or any other mode of payment other than
amounts blocked in the Applicants’ ASBA Account maintained with an SCSB;

(c) Applications not being signed by the sole/joint Applicant(s);

(d) Investor Category in the Application Form not being ticked;

(e) Application Amount blocked being higher or lower than the value of NCDs Applied for. However, our
Company may Allot NCDs up to the number of NCDs Applied for, if the value of such NCDs Applied for
exceeds the minimum Application size;

(f) Applications where a registered address in India is not provided for the non-Individual Applicants;

(g) In case of partnership firms (except LLPs), NCDs applied for in the name of the partnership and not the
names of the individual partner(s);

(h) Minor Applicants (applying through the guardian) without mentioning the PAN of the minor Applicant;

(i) PAN not mentioned in the Application Form, except for Applications by or on behalf of the Central or State
Government and the officials appointed by the courts and by investors residing in the State of Sikkim,
provided such claims have been verified by the Depository Participants. In case of minor Applicants
applying through guardian when PAN of the Applicant is not mentioned;

(j) DP ID and Client ID not mentioned in the Application Form;

(k) GIR number furnished instead of PAN;

(l) Applications by OCBs;

(m) Applications for an amount below the minimum Application size;

(n) Submission of more than five ASBA Forms per ASBA Account;

(o) Applications by persons who are not eligible to acquire NCDs of our Company in terms of applicable laws,
rules, regulations, guidelines and approvals;

(p) Applications under power of attorney or by limited companies, corporate, trust etc. submitted without
relevant documents;

(q) Applications accompanied by stockinvest/ cheque/ money order/ postal order/ cash;

(r) Signature of sole Applicant missing, or in case of joint Applicants, the Application Forms not being signed
by the first Applicant (as per the order appearing in the records of the Depository);

(s) Applications by persons debarred from accessing capital markets, by SEBI or any other appropriate
regulatory authority;

(t) Application Forms not being signed by the ASBA Account holder, if the account holder is different from
the Applicant;

(u) Signature of the ASBA Account holder on the Application Form does not match with the signature available
on the SCSB bank’s records where the ASBA Account mentioned in the Application Form is maintained;

(v) Application Forms submitted to the Designated Intermediaries or to the Designated Branches of the SCSBs
does not bear the stamp of the SCSB and/or the Designated Intermediary, as the case may be;

(w) ASBA Applications not having details of the ASBA Account to be blocked;

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(x) In case no corresponding record is available with the Depositories that matches three parameters namely,
DP ID, Client ID and PAN;

(y) Inadequate funds in the ASBA Account to enable the SCSB to block the Application Amount specified in
the Application Form at the time of blocking such Application Amount in the ASBA Account or no
confirmation is received from the SCSB for blocking of funds;

(z) SCSB making an Application (a) through an ASBA account maintained with its own self or (b) through an
ASBA Account maintained through a different SCSB not in its own name or (c) through an ASBA Account
maintained through a different SCSB in its own name, where clear demarcated funds are not present or (d)
through an ASBA Account maintained through a different SCSB in its own name which ASBA Account
is not utilised solely for the purpose of applying in public issues;

(aa) Applications for amounts greater than the maximum permissible amount prescribed by the regulations and
applicable law;

(bb) Authorization to the SCSB for blocking funds in the ASBA Account not provided;

(cc) Applications by any person outside India;

(dd) Applications not uploaded on the online platform of the Stock Exchange;

(ee) Applications uploaded after the expiry of the allocated time on the Issue Closing Date, unless extended by
the Stock Exchange, as applicable;

(ff) Application Forms not delivered by the Applicant within the time prescribed as per the Application Form,
the Prospectus and as per the instructions in the Application Form and the Prospectus;

(gg) Applications by Applicants whose demat accounts have been ‘suspended for credit’ pursuant to the circular
issued by SEBI on July 29, 2010 bearing number CIR/MRD/DP/22/2010;

(hh) Applications providing an inoperative demat account number;

(ii) Applications submitted to the Designated Intermediaries other than the Collection Centres or at a Branch
of a SCSB which is not a Designated Branch;

(jj) Applications submitted directly to the Public Issue Bank (except in case the ASBA Account is maintained
with the said bank as a SCSB);

(kk) Investor category not ticked;

(ll) In case of cancellation of one or more orders (series) within an Application, leading to total order quantity
falling under the minimum quantity required for a single Application; and

For information on certain procedures to be carried out by the Registrar to the Issue for finalization of the Basis
of Allotment, please see “Information for Applicants” below.

Information for Applicants

Upon the closure of the Issue, the Registrar to the Issue will reconcile the compiled data received from the Stock
Exchange and all SCSBs and match the same with the Depository database for correctness of DP ID, Client ID
and PAN. The Registrar to the Issue will undertake technical rejections based on the electronic details and the
Depository database and prepare list of technical rejection cases. In case of any discrepancy between the electronic
data and the Depository records, our Company, in consultation with the Designated Stock Exchange, the Lead
Manager and the Registrar to the Issue, reserves the right to proceed as per the Depository records for such
Applications or treat such Applications as rejected.

Based on the information provided by the Depositories, our Company shall have the right to accept Applications
belonging to an account for the benefit of a minor (under guardianship).

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In case of Applications for a higher number of NCDs than specified for that category of Applicant, only the
maximum amount permissible for such category of Applicant will be considered for Allotment.

BASIS OF ALLOTMENT

Basis of Allotment for NCDs

The Registrar will aggregate the Applications, based on the applications received through an electronic book from
the Stock Exchange and determine the valid Application for the purpose of drawing the basis of allocation.
Allocation Ratio

The Registrar will aggregate the Applications based on the Applications received through an electronic
book from the Stock Exchange and determine the valid applications for the purpose of drawing the basis
of allocation. Grouping of the application received will be then done in the following manner:

Grouping of Applications and Allocation Ratio: Applications received from various applicants shall be grouped
together on the following basis:

(a) Applications received from Category I applicants: Applications received from Category I, shall be grouped
together, (“Institutional Portion”);

(b) Applications received from Category II applicants: Applications received from Category II, shall be
grouped together, (“Non-Institutional Portion”);

(c) Applications received from Category III applicants: Applications received from Category III, shall be
grouped together, (“Retail Individual Portion”).

For removal of doubt, “Institutional Portion”, “Non-Institutional Portion” and “Retail Individual Portion” are
individually referred to as “Portion” and collectively referred to as “Portions”.

For the purposes of determining the number of NCDs available for allocation to each of the abovementioned
Portions, our Company shall have the discretion of determining the number of NCDs to be Allotted over and
above the Base Issue Size, in case our Company opts to retain any oversubscription in the Issue up to `10,000
lakhs. The aggregate value of NCDs decided to be allotted over and above the Base Issue Size, (in case our
Company opts to retain any oversubscription in the Issue), and/or the aggregate value of NCDs up to the Base
Issue Size shall be collectively termed as the “Overall Issue Size”.

Basis of Allotment for NCDs

Allotments in the first instance:

(i) Applicants belonging to the Category I, in the first instance, will be allocated NCDs up to 10% of overall
Issue Size on first come first serve basis (determined on the basis of date of receipt of each Application
duly acknowledged by the Lead Manager and their respective affiliates/SCSB (Designated Branch or online
acknowledgement));

(ii) Applicants belonging to the Category II, in the first instance, will be allocated NCDs up to 40% of Overall
Issue Size on first come first serve basis (determined on the basis of date of receipt of each Application
duly acknowledged by the Members of the Syndicate/Trading Members/SCSB (Designated Branch or
online acknowledgement));

(iii) Applicants belonging to the Category III, in the first instance, will be allocated NCDs up to 50% of Overall
Issue Size on first come first serve basis (determined on the basis of date of receipt of each Application
duly acknowledged by the Members of the Syndicate/Trading Members/SCSB (Designated Branch or
online acknowledgement));

Allotments, in consultation with the Designated Stock Exchange, shall be made on date priority basis i.e. a first-
come first-serve basis, based on the date of upload of each Application into the electronic book with Stock

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Exchange, in each Portion subject to the Allocation Ratio. However, on the date of oversubscription, the
Allotments would be made to the Applicants on proportionate basis.

(a) Under Subscription:

Under subscription, if any, in any Portion, priority in Allotments will be given in the following order:

(i) Individual Portion

(ii) Non-Institutional Portion and Resident Indian individuals and Hindu undivided families through the
Karta applying who apply for NCDs aggregating to a value exceeding `5 lakhs;
(iii) Institutional Portion

(iv) on a first come first serve basis.

Within each Portion, priority in Allotments will be given on a first-come-first-serve basis, based on the date
of upload of each Application into the electronic system of the Stock Exchange.

For each Portion, all Applications uploaded into the electronic book with the Stock Exchange would be
treated at par with each other. Allotment would be on proportionate basis, where Applications uploaded
into the Platform of the Stock Exchange on a particular date exceeds NCDs to be allotted for each Portion,
respectively.

Minimum allotment of 10 NCD and in multiples of 1 (one) NCD thereafter would be made in case of each
valid Application.

(b) Allotments in case of oversubscription:

In case of an oversubscription, Allotments to the maximum extent, as possible, will be made on a first-
come first-serve basis and thereafter on proportionate basis, i.e. full Allotment of NCDs to the valid
Applicants on a first come first serve basis for forms uploaded up to 5 pm of the date falling 1 (one) day
prior to the date of oversubscription and proportionate allotment of NCDs to the valid Applicants on the
date of oversubscription (based on the date of upload of the Application on the Stock Exchange Platform,
in each Portion). In case of over subscription on date of opening of the Issue, the Allotment shall be made
on a proportionate basis. Applications received for the NCDs after the date of oversubscription will not be
considered for Allotment.

In view of the same, the Investors are advised to refer to the Stock Exchange website at [Link]
for details in respect of subscription.

(c) Proportionate Allotments: For each Portion, on the date of oversubscription:

(i) Allotments to the Applicants shall be made in proportion to their respective Application size,
rounded off to the nearest integer;

(ii) If the process of rounding off to the nearest integer results in the actual allocation of NCDs being
higher than the Issue Size, not all Applicants will be allotted the number of NCDs arrived at after
such rounding off. Rather, each Applicant whose Allotment size, prior to rounding off, had the
highest decimal point would be given preference;

(iii) In the event, there are more than one Applicant whose entitlement remain equal after the manner of
distribution referred to above, our Company will ensure that the Basis of Allotment is finalised by
draw of lots in a fair and equitable manner; and

(iv) The total Allotment under Option I to Option VII of the NCDs shall not exceed a value more than
`20,000 lakhs.

(d) Applicant applying for more than one Options of NCDs:

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If an Applicant has applied for more than one Options of NCDs, and in case such Applicant is entitled to
allocation of only a part of the aggregate number of NCDs applied for due to such Applications received
on the date of oversubscription, the option-wise allocation of NCDs to such Applicants shall be in
proportion to the number of NCDs with respect to each option, applied for by such Applicant, subject to
rounding off to the nearest integer, as appropriate in consultation with Lead Manager and Designated Stock
Exchange.

In cases of odd proportion for Allotment made, our Company in consultation with the Lead Manager will
Allot the residual NCD (s) in the following order:

(i) first with monthly interest payment in decreasing order of tenor i.e. Options VI, IV, II and I;

(ii) followed by payment on cumulative options in decreasing order of tenor i.e. Options VII, V and III.

Hence using the above procedure, the order of Allotment for the residual NCD(s) will be: VI, IV, II, I, VII,
V and III.

All decisions pertaining to the Basis of Allotment of NCDs pursuant to the Issue shall be taken by our
Company in consultation with the Lead Manager, and the Designated Stock Exchange and in compliance
with the aforementioned provisions of this Prospectus.

Our Company would Allot Option I NCDs to all valid applications, wherein the Applicants have not
indicated their choice of the relevant options of the NCDs.

Valid applications where the Application Amount received does not tally with or is less than the amount
equivalent to value of number of NCDs applied for, may be considered for Allotment, to the extent of the
Application Amount paid rounded down to the nearest `1,000 in accordance with the pecking order
mentioned above.

All decisions pertaining to the Basis of Allotment of NCDs pursuant to the Issue shall be taken by our Company
in consultation with the Lead Manager and the Designated Stock Exchange and in compliance with the
aforementioned provisions of this Prospectus.

Retention of oversubscription

Our Company shall have an option to retain over-subscription up to the Issue limit.

Unblocking of Funds for withdrawn, rejected or unsuccessful or partially successful Applications

The Registrar shall, pursuant to preparation of Basis of Allotment, instruct the relevant SCSB to unblock the funds
in the relevant ASBA Account for withdrawn, rejected or unsuccessful or partially successful Applications within
six Working Days of the Issue Closing Date.

ISSUANCE OF ALLOTMENT ADVICE

Our Company shall ensure dispatch of Allotment Advice and/ or give instructions for credit of NCDs to the
beneficiary account with Depository Participants upon approval of Basis of Allotment. The Allotment Advice for
successful Applicants will be mailed by speed post/registered post to their addresses as per the Demographic
Details received from the Depositories.

Our Company shall use best efforts to ensure that all steps for completion of the necessary formalities for
commencement of trading at the Stock Exchange where the NCDs are proposed to be listed are taken within six
Working Days from the Issue Closing Date.

Application Amount shall be unblocked within six Working Days from the Issue Closing Date or such lesser time
as may be specified by SEBI or else the Application Amount shall be unblocked in the ASBA Accounts of the
Applicants forthwith, failing which interest shall be due to be paid to the Applicants in accordance with applicable
law.

Our Company will provide adequate funds required for dispatch of Allotment Advice to the Registrar to the Issue.

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OTHER INFORMATION

Withdrawal of Applications during the Issue Period

Retail Individual Investors (“RII”) can withdraw their Applications until the Issue Closing Date. In case an RII
wishes to withdraw the Application during the Issue Period, the same can be done by submitting a request for the
same to the concerned Designated Intermediary who shall do the requisite, including unblocking of the funds by
the SCSB in the ASBA Account.

In case of Applications were submitted to the Designated Intermediaries, upon receipt of the request for
withdrawal from the Applicant, the relevant Designated Intermediary, as the case may be, shall do the requisite,
including deletion of details of the withdrawn Application Form from the electronic system of the Stock Exchange
and intimating the Designated Branch of the SCSB to unblock of the funds blocked in the ASBA Account at the
time of making the Application. In case of Applications submitted directly to the Designated Branch of the SCSB,
upon receipt of the request for withdraw from the Applicant, the relevant Designated Branch shall do the requisite,
including deletion of details of the withdrawn Application Form from the electronic system of the Stock Exchange
and unblocking of the funds in the ASBA Account, directly.

Withdrawal of Applications after the Issue Period

In case an Applicant wishes to withdraw the Application after the Issue Closing Date or early closure date, the
same can be done by submitting a withdrawal request to the Registrar to the Issue prior to the finalization of the
Basis of Allotment.

Revision of Applications

As per the notice No: 20120831-22 dated August 31, 2012 issued by the BSE, cancellation of one or more orders
(series) within an Application is permitted during the Issue Period as long as the total order quantity does not fall
under the minimum quantity required for a single Application. Please note that in case of cancellation of one or
more orders (series) within an Application, leading to total order quantity falling under the minimum quantity
required for a single Application will be liable for rejection by the Registrar.

Applicants may revise/ modify their Application details during the Issue Period, as allowed/permitted by the Stock
Exchange, by submitting a written request to the Designated Intermediary and the Designated Branch of the
SCSBs, as the case may be. However, for the purpose of Allotment, the date of original upload of the Application
will be considered in case of such revision/ modification. In case of any revision of Application in connection
with any of the fields which are not allowed to be modified on the electronic Application platform of the Stock
Exchange as per the procedures and requirements prescribed by the Stock Exchange, Applicants should ensure
that they first withdraw their original Application and submit a fresh Application. In such a case the date of the
new Application will be considered for date priority for Allotment purposes.

Revision of Applications is not permitted after the expiry of the time for acceptance of Application Forms on the
Issue Closing Date. However, in order that the data so captured is accurate, the Designated Intermediaries and/ or
the Designated Branches of the SCSBs will be given up to one Working Day after the Issue Closing Date to
modify/ verify certain selected fields uploaded in the online system during the Issue Period, after which the data
will be sent to the Registrar for reconciliation with the data available with the NSDL and CDSL.

Depository Arrangements

We have made depository arrangements with NSDL and CDSL. Please note that Tripartite Agreements have been
executed between our Company, the Registrar and both the depositories.

As per the provisions of the Depositories Act, 1996, the NCDs issued by us can be held in a dematerialised form.
In this context:

(i) Tripartite agreement dated January 30, 2014 among our Company, the Registrar and CDSL and tripartite
agreement dated February 5, 2014 among our Company, the Registrar and NSDL, respectively for offering
depository option to the investors.

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(ii) An Applicant must have at least one beneficiary account with any of the Depository Participants (DPs) of
NSDL or CDSL prior to making the Application.

(iii) The Applicant must necessarily provide the DP ID and Client ID details in the Application Form.

(iv) NCDs Allotted to an Applicant in the electronic form will be credited directly to the Applicant’s respective
beneficiary account(s) with the DP.
(v) Non-transferable Allotment Advice will be directly sent to the Applicant by the Registrar to this Issue.

(vi) It may be noted that NCDs in electronic form can be traded only on the Stock Exchange having electronic
connectivity with NSDL or CDSL. The Stock Exchange has connectivity with NSDL and CDSL.

(vii) Interest or other benefits with respect to the NCDs held in dematerialised form would be paid to those
Debenture Holders whose names appear on the list of beneficial owners given by the Depositories to us as
on Record Date. In case of those NCDs for which the beneficial owner is not identified by the Depository
as on the Record Date/ book closure date, we would keep in abeyance the payment of interest or other
benefits, till such time that the beneficial owner is identified by the Depository and conveyed to us,
whereupon the interest or benefits will be paid to the beneficiaries, as identified, within a period of 30 days.

Please note that the NCDs shall cease to trade from the Record Date (for payment of the principal amount and the
applicable premium and interest for such NCDs) prior to redemption of the NCDs.

PLEASE NOTE THAT TRADING OF NCDs ON THE FLOOR OF THE STOCK EXCHANGE SHALL
BE IN DEMATERIALISED FORM ONLY IN MULTIPLE OF ONE NCD.

Allottees will have the option to re-materialize the NCDs Allotted under the Issue as per the provisions of the
Companies Act, 2013 and the Depositories Act.

Communications

All future communications in connection with Applications made in this Issue (except the Applications made
through the Trading Members of the Stock Exchange) should be addressed to the Registrar to the Issue, with a
copy to the relevant SCSB, quoting the full name of the sole or first Applicant, Application Form number,
Applicant’s DP ID and Client ID, Applicant’s PAN, number of NCDs applied for, date of the Application Form,
name and address of the Designated Intermediary or Designated Branch of the SCSBs, as the case may be, where
the Application was submitted, ASBA Account number in which the amount equivalent to the Application
Amount was blocked.

Applicants may contact our Compliance Officer and Company Secretary or the Registrar to the Issue in case of
any pre-Issue or post-Issue related problems such as non-receipt of Allotment Advice or credit of NCDs in the
respective beneficiary accounts, as the case may be.

Interest in case of delay

Our Company undertakes to pay interest, in connection with any delay in Allotment and demat credit, beyond the
time limit as may be prescribed under applicable statutory and/or regulatory requirements, at such rates as
stipulated under such applicable statutory and/or regulatory requirements.
Undertaking by the Issuer

Our Company undertakes that:

(a) All monies received pursuant to this Issue shall be transferred to a separate bank account as referred to in
sub-section (3) of section 40 of the Companies Act, 2013;

(b) Details of all monies utilised out of this Issue referred to in sub-item (a) shall be disclosed under an
appropriate separate head in our balance sheet indicating the purpose for which such monies had been
utilised;

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(c) Details of all unutilised monies out of issue of NCDs, if any, referred to in sub-item (a) shall be disclosed
under an appropriate separate head in our balance sheet indicating the form in which such unutilised monies
have been invested;

(d) Details of all utilized and unutilised monies out of the monies collected in the previous issue made by way
of public offer shall be disclosed and continued to be disclosed in the balance sheet till the time any part of
the proceeds of such previous issue remains unutilized indicating the purpose for which such monies have
been utilized, and the securities or other forms of financial assets in which such unutilized monies have
been invested;

(e) Undertaking by our Company for execution of the Debenture Trust Deed. Further, as per Regulation 15 of
SEBI Debt Regulations, in the event our Company fails to execute the Debenture Trust Deed within a
period of three months from the Issue Closing Date, our Company shall pay interest of at least 2% p.a. to
each NCD Holder, over and above the agreed coupon rate, till the execution of the Debenture Trust Deed;

(f) We shall utilize the Issue proceeds only upon execution of the Debenture Trust Deed as stated in this
Prospectus and the Prospectus, on receipt of the minimum subscription of 75% of the Base Issue i.e.`7,500
lakhs and receipt of listing and trading approval from the Stock Exchange;

(g) The Issue proceeds shall not be utilized towards full or part consideration for the purchase or any other
acquisition, inter alia by way of a lease, of any immovable property business, dealing in equity of listed
companies or lending/investment in group companies; and

(h) Application money shall be unblocked within six Working Days from the closure of this Issue or such
lesser time as may be specified by SEBI, or else the Application money shall be refunded to the Applicants
in accordance with applicable law, failing which interest shall be due to be paid to the Applicants for the
delayed period, if applicable in accordance with applicable law.

Other Undertakings by our Company

Our Company undertakes that:

(a) Complaints received in respect of this Issue (except for complaints in relation to Applications submitted to
Trading Members) will be attended to by our Company expeditiously and satisfactorily;

(b) Necessary cooperation to the relevant credit rating agency(ies) will be extended in providing true and
adequate information until the obligations in respect of the NCDs are outstanding;

(c) Our Company will take necessary steps for the purpose of getting the NCDs listed within the specified
time, i.e., within six Working Days of this Issue Closing Date;

(d) Funds required for dispatch of Allotment Advice/NCD Certificates (only upon rematerialisation of NCDs
at the specific request of the Allottee/ Holder of NCDs) will be made available by our Company to the
Registrar to the Issue;

(e) Our Company will forward details of utilisation of the proceeds of this Issue, duly certified by the Statutory
Auditor, to the Debenture Trustee on a half-yearly basis;

(f) Our Company will provide a compliance certificate to the Debenture Trustee on an annual basis in respect
of compliance with the terms and conditions of this Issue as contained in this Prospectus;

(g) Our Company will disclose the complete name and address of the Debenture Trustee in its annual report;
and

(h) Our Company shall make necessary disclosures/ reporting under any other legal or regulatory requirement
as may be required by our Company from time to time.

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SECTION VII - LEGAL AND OTHER INFORMATION

OUTSTANDING LITIGATIONS

Except as stated in this section, there are no outstanding: (i) criminal proceedings; (ii) actions by
statutory/regulatory authorities; (iii) claims for any indirect and direct tax liability; and (iv) other litigations
which are identified as material in terms of the Materiality Policy (as defined hereinafter below), each involving
our Company, Directors or Promoters.

Our Board, in its meeting held on July 20, 2020, has adopted a policy on the identification of material litigations
(“Materiality Policy”). As per the Materiality Policy, other than for the purposes of (i) to (iii) above, all
outstanding litigation, wherein:

(a) the quantified monetary amount of claim by or against the relevant person in any such pending litigation
proceeding is or is in excess of 5% of our Company’s net profit after tax as per our last audited financial
statements, i.e., for Fiscal 2020, 5% of our Company’s net profit after tax amounts to `167.71 lakhs; or

(b) the outcome of such litigation proceeding may have a material adverse effect on the business, operations,
prospects or reputation of the Company,

has been considered as ‘material litigation’, and accordingly has been disclosed in this Prospectus.

Further, except as mentioned in this section, there are no proceedings involving our Group Companies, which
may have a material adverse effect on the position of our Company.

It is clarified that for the purposes of the above, pre-litigation notices received by our Company, Directors,
Promoters or Group Companies shall, unless otherwise decided by our Board of Directors, not be considered as
litigation until such time that our Company or Directors or Promoters or Group Companies, as the case may be,
is impleaded as a defendant in litigation proceedings before any judicial forum.

Further, except as stated in this section, there are no: (i) litigation or legal action pending or taken by any Ministry
or Department of the Government or a statutory authority against our Promoters during the last five years
immediately preceding the year of the issue of this Prospectus and any direction issued by such Ministry or
Department or statutory authority; (ii) pending litigation involving our Company, our Promoter, our Directors,
Group Companies, or any other person, whose outcome could have material adverse effect on the position of our
Company; (iii) pending proceedings initiated against our Company for economic offences; (iv) default and non-
payment of statutory dues, etc; (v) inquiries, inspections or investigations initiated or conducted against our
Company under the Companies Act or any previous companies law in the five years immediately preceding the
year of this Prospectus; (vi) prosecutions filed (whether pending or completed), fines imposed or compounding of
offences done in the five years immediately preceding the year of this Prospectus; and (vii) material frauds
committed against our Company in the last five years.

Further from time to time, we have been and shall continue to be involved in legal proceedings filed by and/or
against us, arising in the ordinary course of our business. We believe that the number of proceedings in which we
are/were involved is not unusual for a company of our size doing business in India.

Unless stated to the contrary, the information provided below is as of the date of this Prospectus.

All terms defined in a particular litigation disclosure below are for that particular litigation only.

(a) Litigations involving our Company

Against our Company

Civil cases

1. M. Mathew (“Plaintiff”) had filed a suit (bearing number OS No. 6 of 2013) dated June 16, 2013 (“Suit”)
before the District Court, Kottayam (“Court”) under section 134 of the Trade Mark Act, 1999 read with
Order VII Rule I read with Section 26 of the Code Of Civil Procedure, 1908 against our Company and other
(together referred to as the “Defendants”). The Plaintiff claims that the trademark “Muthoot” is the exclusive

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property of the Plaintiff and no one else can claim the right to use the name in their business. The Plaintiff
has prayed that a judgment and decree of permanent prohibitory injunction to be issued restraining the
Defendants from directly or indirectly using the trade mark “Muthoot” allegedly registered in the name of
the Muthoot and thereby infringing it, interfere with or cause harm to the trade of business of Plaintiff in any
manner whatsoever, to grant a permanent prohibitory injunction restraining the Defendants from using in any
manner the allegedly registered trade mark of the Plaintiff “Muthoot”, in connection with their business and
to grant such other relief as the Court may think fit. The Plaintiff has also filed an application (bearing number
1277 of 2013) dated June 16, 2013 for interim injunction restraining the Defendants from using the trademark
‘Muthoot’. A counter affidavit was filed by Roy M. Mathew, as the Chairman of our Company, on August
23, 2013 denying all the claims of the Plaintiff and alleging that this was the Plaintiff’s attempt to stall the
functioning of the companies. An Affidavit was filed by the Plaintiff on December 3, 2015 impleading
additional parties to the matter. Thereafter, Mr Mathew Muthootu, our Managing Director, filed a written
statement on May 28, 2019 categorically raising objections in relation to the Suit, inter alia, claiming that the
proceedings challenging the validity of the trademark are pending before the relevant authority and therefore
the Suit should be stayed and further substantiating the arguments advanced by the Defendants. The matter
is currently pending.

2. Our Company received a notice bearing number ROC(K)/STAT/F92/196/2012 dated May 2, 2012 (“Notice”)
from the Registrar of Companies, Kerala and Lakshadweep (“ROC”). The ROC had received a letter dated
January 31, 2012 from M Mathew (“Complainant”), requesting not to register any company with the name
“Muthoot” as the same is registered in the Complainants name on September 19, 2005 by the trademark
registry, Mumbai. Hence ROC issued the Notice requesting us to offer our comments within 15 days of
receipt of the Notice. Our Company replied to the Notice vide letter dated May 31, 2012 stating that we have
secured registration for our logo and the “Mini Muthoottu” in class 36 vide registration dated April 30, 2009
and have absolute right to carry on the business by using “Muthoottu” as part of our trademark. The matter
is pending.

3. M. Murgan and others (“Plaintiffs”) filed a suit (O.S. 183/2018) (“Suit”) against R. Parvathy, our Company
and others (“Defendants”) before the Principal District Judge, Chengalpattu (“Court”) alleging that various
sale deeds (“Sale Deeds”) for the property situated at Kancheepuram district, Thirupporur Taluk,
Kelambakkam Firka, Eagattur Village (“Property”) were entered into without the knowledge of the Plaintiffs,
the alleged owners of the Property. The Plaintiffs have sought for the annulment of such Sale Deed and for
the partition of the Property. The matter is currently pending.

Tax Proceedings involving our Company

Nature of case Number of cases outstanding Amount involved (in ` lakhs)

Direct Tax 9 1,799.93
Total 9 1,799.93

By our Company

Civil cases

As on date of this Prospectus, there are no civil proceedings filed by our Company.

Criminal cases

1. Our Company has filed a petition (bearing no. CC. No. 1096 of 2016) (“Petition”) under Section 138 of the
Negotiable Instruments Act, 1881 before the Judicial Magistrate First Class, Kochi (“Court”) against V.
Senthil Vel Murughan (“Accused”), the landlord of our branch located at Nagarcoil Tower Junction, for an
amount of `3.87 lakhs being the interest free security deposit amount for which a cheque was issued and was
dishonoured due to insufficiency of funds in the account of the Accused. This matter was transferred to a
Negotiable Instruments Court, Ernakulam and is currently pending.
2. Our Company has filed various criminal complaints against customers and ex-employees of our Company
before various judicial forums under section 138 of the Negotiable Instruments Act, 1881 for certain cheques

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that bounced on presentation and others which were remained unpaid. The aggregate amount involved in
these matters is `63.32 lakhs. These matters were transferred to a Special’s Court and are currently pending.
(b) Litigations involving our Directors

As on the date of this Prospectus, there are no outstanding litigations involving our Directors, which can have
a material adverse effect on the position of our Company.

(c) Litigations involving our Promoters

As on the date of this Prospectus, there are no outstanding litigations involving our Promoters, which can
have a material adverse effect on the position of our Company.

(d) Litigations involving our Group Companies

Nil

(e) Litigation or legal action pending or taken by any ministry or government department or statutory
authority against our Promoters during the last five years immediately preceding the year of the issue of
this Prospectus and any direction issued by any such ministry or department or statutory authority upon
conclusion of such litigation or legal action:

Nil

(f) Inquiries, inspections or investigations initiated or conducted under the Companies Act or any previous
companies law in the last five years immediately preceding the year of issue of this Prospectus against our
Company (whether pending or not); fines imposed or compounding of offences done by our Company in
the last five years immediately preceding the year of this Prospectus

Except as disclosed below, there are no inquiries, inspections or investigations initiated or conducted under
the Companies Act or any previous companies law in the last five years immediately preceding the year of
issue of this Prospectus against our Company (whether pending or not); fines imposed or compounding of
offences done by our Company in the last five years immediately preceding the year of this Prospectus:

(a) The Registrar of Companies, Kerala and Lakshadweep issued five show cause notices, each dated July
5, 2018, against our Company for not creating charges on the credit facilities availed from HDFC Bank
Limited within the prescribed time period under Section 77 of the Companies Act, 2013. Our Company
filed petitions under Section 87 of the Companies Act, 2013 before the Regional Director (Southern
Region), Ministry of Corporate Affairs, Chennai (“Regional Director”) for condonation of delay in
creating the charges. The Regional Director vide its orders dated August 10, 2018 and September 20,
2018 condoned the delay by our Company in creating the charges, and we filed relevant forms with RoC
subsequently.
(b) SEBI had issued a show cause notice to our Company dated December 12, 2019 (“SCN”), under Rule
4(1) of the Securities and Exchange Board of India (Procedure for Holding Inquiry and Imposing
Penalties by Adjudicating Officer) Rules, 1995, for the alleged issuance of a misleading advertisement
on our website, in relation to the public issue of secured, redeemable non-convertible debentures
aggregating to `10,000 lakh with an option to retain oversubscription upto `10,000 lakh (“NCD Issue”).
SEBI in the SCN has alleged violation by our Company of Regulation 8 of the SEBI Debt Regulations.
SEBI had sought response to the SCN supported by documentary evidence within 15 days from the date
of the receipt of SCN (i.e. December 18, 2019). Our Company submitted its response to SEBI on January
16, 2020. The Adjudicating Officer of SEBI through its order dated February 26, 2020 imposed a penalty
of `10 lakh under section 15HB of the SEBI Act for the violation of Regulation 8 of the SEBI Debt
Regulations. Our Company subsequently paid the penalty on March 16, 2020.
(g) Details of acts of material frauds committed against our Company in the last five Fiscals, if any, and if so,
the action taken by our Company

Except as disclosed below, there are no material frauds committed against our Company in the last five
Fiscals:

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Date of
Amount
Detection / Amount Provision
Sl. Modus Operandi & Recovery Written
Branch Date Of (in ` (in ` Remarks
No Action Taken (in ` lakh) -off (in
Reporting lakhs) lakhs)
` lakhs)
To RBI
1 Shenkott 07-07-2015/ 1.00 The branch manager 0.00 - 1.00 The Company has
ai 25-07-2015 absconded with cash filed a case against
amounting to `1.00 the branch manager
lakh and 123 gold loan at Shenkottai police
packets with total station. The matter
advance of `41.95 lakh is pending before
the Tenkasi district
court. The staff left
the keys inside the
branch and went
outside. Even
though CCTV was
installed in the
branch, it was not in
working condition
at the time of the
incident. Joint
custody violation
resulted in the
malpractice.
2 Shenkott 07-07-2015/ 41.95 The branch manager 5.00 - 36.95 The Company has
ai 25-07-2015 absconded with cash filed a case against
amounting to `1.00 the branch manager
lakh and 123 gold loan at Shenkottai police
packets with total station. The matter
advance of `41.95 lakh is pending before
the Tenkasi district
court. The staff left
the keys in the
branch and went
outside. Even
though CCTV was
installed in the
branch, it was not in
working condition
at the time of the
incident. Joint
custody violation
resulted in the
malpractice.
3 Dwarka 20-11-2015 / 30.42 The branch manager 30.42 0.00 NIL Since 100%
09-12-2015 with the involvement of recovery was
the audit staff pledged effected, the
spurious gold in the Company
branch under fictitious terminated the
names. services of all the
employees
(including the audit
staff).
4 Nethaji 02-01-2016/ 54.68 The branch manager 2.20 - 52.48 The Company has
Road 18-01-2016 along with some other terminated all
employees had employees involved
procured spurious in the fraud. The
jewellery and pledged it Company has also
in the branch. handed over 17
Involvement of others spurious packets to
is suspected, and the the court on 12-10-
same is being is being 2017 via the police
investigated by Police. and completed the
The Company also appraising process

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Date of
Amount
Detection / Amount Provision
Sl. Modus Operandi & Recovery Written
Branch Date Of (in ` (in ` Remarks
No Action Taken (in ` lakh) -off (in
Reporting lakhs) lakhs)
` lakhs)
To RBI
suspect negligence by by the court’s
the audit staff. FIR No: appraiser. The
1/2016 has been filed in Company has been
pursuance of the same allotted PR
and police enquiry in No:122/2017 in
progress pursuance of the
same.
5 Buchhi 25-07-2016/ 20.08 Members of the staff 20.08 - NIL Since 100%
Reddy 06-09-2016 collected cash from recovery was
Palem borrowers for closure of effected, the
loans and returned Company
ornaments without terminated the
remitting cash to the services of all the
account. employees.
6 Channap 25-07-2016/ 103.07 The branch manager 90.12 4.33 8.62 The Company
atna 06-09-2016 obtained possession of terminated the
the keys of the vault branch employees.
room by mis-guiding The Company also
the other staff. registered a criminal
Following which, he case against the
entered the branch early accused which is
morning on 23.07.2016 pending before the
and removed cash and court.
valuables worth from
`103.07 lakh (`98.74
lakh gold and `4.33
lakh cash) from the
vault.
7 Panthalk 02-07-2016/ 87.20 3 people impersonated 75.38 2.99 8.83 The Company filed
udi 06-09-2016 customers and looted a case against the
all the ornaments kept concerned
in the strong room. The employees and
three people are not other the culprits at
accomplices of our Aruppukottai Town
employees. police station and
the case is pending
before
Aruppukottaicourt.
At the time of
robbery, the branch
did not have CCTV
installed inside the
branch. The branch
has now installed a
CCTV which is in
working condition.
No joint custody
violations observed.
8 Gangava 16-08-2016/ 102.66 The former branch 100.20 1.35 1.11 The Company
lli 04-10-2016 manager cut the terminated the
window grill to enter branch manager and
the branch and stole an the joint custodian.
amount of `102.66 lakh Full recovery has
(`101.31 gold and been made in this
`1.35 lakh cash) from case except:
the branch a. GL No: 2171
(Customer Name:
Sasikala, Net
Weight: 26gm and
Gross weight
26.6gm)

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Date of
Amount
Detection / Amount Provision
Sl. Modus Operandi & Recovery Written
Branch Date Of (in ` (in ` Remarks
No Action Taken (in ` lakh) -off (in
Reporting lakhs) lakhs)
` lakhs)
To RBI
b. GL NO: 2019
(two chains
weighing 20.520
gram)
c. Cash balance of
`1,34,873.00.
9 Summan 14-11-2016/ 15.78 An account was 3.50 11.24 1.04 The Company
ahalli 26-11-2016 opened, and our terminated all the
Company’s funds were employees. The
transferred through main accused
NEFT to the personal Rajesh has taken
account. Some of the anticipatory bail and
gold loan packets were the police is yet to
tampered with and the file a counter
jewels were stolen. petition.
Further, rent payments
to the extent of `0.75
lakh was
misappropriated by
preparing cash
vouchers without
paying the landlord.
(`4.54 lakh gold and
`11.24 lakh Cash)
10 N I T 21-03-2017 3.17 Fake/low purity 0.00 - 3.17 The Company
Faridaba /spurious gold terminated all the
d ornaments were employees.
pledged to us. The
ornaments were made
of metal other than gold
but were coated heavily
with gold and therefore,
was not traceable on
touch stone. This was
done with the aid of
fake KYC documents.
The fraud came to light
during the process of
auditing, when we
pierced and tested the
metals.
11 Old 24-03-2017 6.89 Fake/low purity 0.00 - 6.89 The Company
Railway /spurious gold terminated all the
Road ornaments were employees.
pledged to us. The
ornaments were made
of metal other than gold
but were coated heavily
with gold and therefore,
was not traceable on
touch stone. This was
done with the aid of
fake KYC documents.
The fraud came to light
during the process of
auditing, when we
pierced and tested the
metals.
12 Sector 24-03-2017 3.89 Fake/low purity 0.00 NIL 3.89 The Company
37 Huda /spurious gold terminated all the
Market ornaments were employees.

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 Muthoottu Mini Financiers Limited

Date of
Amount
Detection / Amount Provision
Sl. Modus Operandi & Recovery Written
Branch Date Of (in ` (in ` Remarks
No Action Taken (in ` lakh) -off (in
Reporting lakhs) lakhs)
` lakhs)
To RBI
pledged to us. The
ornaments were made
of metal other than gold
but were coated heavily
with gold and therefore,
was not traceable on
touch stone. This was
done with the aid of
fake KYC documents.
The fraud came to light
during the process of
auditing, when the
Company pierced and
tested the metals.
13 Sheetala 24-03-2017 4.75 Fake/low purity 0.00 - 4.75 The Company
Mata /spurious gold terminated all the
Road ornaments were employees.
pledged to us. The
ornaments were made
of metal other than gold
but were coated heavily
with gold and therefore,
was not traceable on
touch stone. This was
done with the aid of
fake KYC documents.
The fraud came to light
during the process of
auditing, when we
pierced and tested the
metals.
14 Sona 24-03-2017 3.50 Fake/low purity 0.00 - 3.50 The Company
Chowk /spurious gold terminated all the
ornaments were employees.
pledged to us. The
ornaments were made
of metal other than gold
but were coated heavily
with gold and therefore,
was not traceable on
touch stone. This was
done with the aid of
fake KYC documents.
The fraud came to light
during the process of
auditing, when the
Company pierced and
tested the metals.
15 N R Pura 03-06-2017 1.16 The branch in charge 1.16 - - The Company
removed ornaments in 4 terminated all the
packets and accepted employees.
spurious gold for
pledge.
16 Sattenap 17-07-2017 41.80 The employees of the 18.00 - 23.80 The Company
alli Company colluded terminated all the
defrauded our employees. The
Company by Company also filed
intentionally inflating a FIR against the
weight of ornaments, concerned persons,
preparing fake pledge proceedings for
documents and which are pending.

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 Muthoottu Mini Financiers Limited

Date of
Amount
Detection / Amount Provision
Sl. Modus Operandi & Recovery Written
Branch Date Of (in ` (in ` Remarks
No Action Taken (in ` lakh) -off (in
Reporting lakhs) lakhs)
` lakhs)
To RBI
renewing existing loans
for higher amounts
without borrowers’
knowledge.
17 Charkop 23-07-2018 186.90 109 gold packets - 104.25 50.33 The Company
(overdue packets) held terminated all the
at Charkop Branch in employees and filed
possession of the a FIR against the
cluster head, Mr. Maju people concerned.
Mathew, were found to
be missing.

Mr. Maju Mathew had

raised fake gold loans.
Remittances received
for investments were
then used to close these
fake loans. Meanwhile,
the remitters were
issued fake investment
certificates. All these
fraudulent acts were
committed with the
knowledge of Savitha
Ajayan and Babaso
Shamrao Surve, who
were employees of the
branch.
18 Maruthis 11-01-2019 19.86 Thickly gold coated 16.09 NIL 3.77 The Company has
eva spurious bangles were filed a police
Nagar pledged to our complaint.
Company
19 Tml- 14-06- NIL Ms. Aneesha, branch NA NA NA The full amount has
Raja 2019/08-07- head, collected funds on been settled by Ms.
Street 2019 the pretext of raising Aneesha directly to
resource and got it the customer
routed to her own
personal account using
fraudulent and forged
means. Subsequently,
she forged a deposit
certificate and sent out a
soft copy of the same.
On receiving query
from the investor, the
fraud came to light.
TML- Certain borrowers
21-12- The Company has
Puthirag pledged spurious
20. 2019/06-01- 20.75 4.55 - 16.20 filed a police
oundan ornaments to the
2020 complaint.
Palayam Company

(h) Summary of reservations, qualifications, emphasis of matter or adverse remarks of auditors in the last five
Fiscals immediately preceding the year of issue of this Prospectus and of their impact on the financial
statements and financial position of our Company and the corrective steps taken and proposed to be taken
by our Company for each of the said reservations or qualifications or emphasis of matter or adverse
remarks

Other than as disclosed below, there are no reservations or qualifications or emphasis of matter or adverse
remarks in the Company’s audited financial statements in the last five Fiscals preceding this Prospectus:

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 Muthoottu Mini Financiers Limited

Impact on the
Corrective steps
Financial Summary of Reservations/Qualifications/Emphasis Financial statements
taken and proposed
Year of Matter/Adverse Remarks and financial position
to be taken
of the Issuer
2015 -16 In our opinion and as per our examination of the
documents presented for our verification, no financial
transaction or matter has been identified as having an
adverse effect on the functioning of the company, except
impact, if any, of the matters disclosed in Note No. 13
and Note No. 16 of Notes to Financial Statements
Note-13 No impact on the To ensure that the
financial statements Subordinated Debt is
Subordinated Debt within the limits
The Company has raised `9878.04 lakhs during the year prescribed by RBI, the
by way of private placement of Subordinated Debt Company has stopped
Instrument having a maturity of 66 months. subordinated debt
with effect from
November, 2016
Note-16 No impact on the No corrective steps
financial statements were required.
Purchase of Fixed Assets (Land and Buildings) However, the
In order to facilitate functioning of branches and Company
corporate office in an efficient manner, the Company subsequently took a
has entered into an agreement to acquire fixed assets fresh valuation of the
comprising land and buildings which is presently being property purchased
occupied by the Company in the capacity of a tenant for due to fall in property
a total consideration of `21,900.00 lakhs. The Company prices on account of
has paid an aggregate amount of `20,000.00 lakhs as demonetization and to
part payment of the consideration and has taken take into account the
possession of the assets. Since substantial part of the observations of RBI
consideration has been paid and assets have been put to during their inspection
use by the Company, the amount paid has been in November 2016.
capitalized in the books of the company as fixed assets The difference in the
(Land and Building). valuation amounting
to `9,000.00 lakhs
was brought back to
the books of accounts
of the Company. The
values of Fixed Assets
have been reduced to
such extent.
2019-20 On March 11, 2020, the World Health Organization No impact on the The matter has been
declared the COVID-19 outbreak to be a pandemic. The financial statements noted and suitable
impact of and uncertainty related to the COVID-19 measures will be taken
pandemic has been identified as a key element for when required.
recognition and measurement of impairment on loans
and advances on account of its impact on the Company's
customers and their ability to repay their dues. The
management has undertaken a thorough analysis of the
possible impact of the pandemic and has concluded that
the COVID-19 pandemic may have an impact on the
Company’s financial performance depending on future
developments, which is highly uncertain as of now. Our
audit opinion on the Financial Statements has not been
modified in respect of the above matters.

(i) Summary of other observations of the auditors in the last five Fiscals immediately preceding the year of
issue of this Prospectus and of their impact on the financial statements and financial position of our
Company and the corrective steps taken and proposed to be taken by our Company for each of the said
observation:

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Impact on the
Financial
Corrective steps
Financial statements and
Summary of Other Observations taken and proposed
Year financial
to be taken
position of the
Issuer
2015 -16 In our opinion, the standalone financial statements The impact of Company has started
comply with the accounting standards specified non-adherence making provision as
under Section 133 of the Companies Act, 2013 read could not be per actuarial
with Rule 7 of the Companies (Accounts) Rules, ascertained as valuation for the
2014, except AS 15, Accounting for Employee actuarial subsequent years.
Benefit Expenses with regard to provision for valuation was not
gratuity made without actuarial valuation; conducted.
2015 -16 According to the information and explanations To the extent of Appeal has been filed
provided to us, the following dues of income tax tax not paid, in all cases.
have not been deposited by the Company on account profit /general
of disputes pending: reserve of the
Amount In Forum where the dispute is Company has
` Lakhs pending been overstated.
11.26 Income Tax Appellate Tribunal,
Kochi
206.7 Commissioner of Income Tax
(Appeals), Trivandrum
338.6 Commissioner of Income Tax
(Appeals), Kottayam
2015 -16 According to the information and explanations Since the The Company has
provided to us, frauds involving pledge of spurious company has taken insurance
gold amounting to `97.63 lakhs in Shenkottai and already created cover for such losses
Netaji Road branches of the Company on the 100% provision and has filed
Company by its employees have been noticed. for all applicable insurance claims in
cases, No further this regard. Further,
impact on the the Company has
financial filed police
statements. complaints and is in
the process of
recovering these
amounts from the
employees and
taking legal actions,
where applicable
2016-17 According to the information and explanations To the extent of Appeal has been filed
provided to us, the following dues of income tax, tax not paid, in all cases.
have not been deposited by the Company on account profit /general
of disputes pending, reserve of the
Amount In ` Forum where the dispute is company has
Lakhs pending been overstated.
68.58 Commissioner of Income tax
(Appeals), Kottayam
150.33 Commissioner of Income tax
(Appeals), Kottayam
338.57 Commissioner of Income tax
(Appeals), Kottayam
2016-17 According to the information and explanations Since the The Company has
provided to us, frauds involving pledge of spurious Company has taken insurance
gold and misappropriation and theft of cash totalling already created cover for such losses
to `330.71 lakhs across 9 branches of the Company 100% provision and has filed
on the Company by its employees have been noticed. for all applicable Insurance claims in
Out of this amount, `265.8 lakhs have been cases, No further this regard. Further,
recovered during the period. impact on the the Company has

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Impact on the
Financial
Corrective steps
Financial statements and
Summary of Other Observations taken and proposed
Year financial
to be taken
position of the
Issuer
financial filed police cases and
statements. is in the process of
recovering these
amounts from the
employees and
taking legal actions,
where applicable.
2017-18 As per the records produced for our verification and To the extent of Appeal has been filed
information and explanations provided to us there tax not paid, in all cases.
are no dues of income tax, value added tax, sales tax, profit /general
service tax, goods and service tax, cess and other reserve of the
material statutory dues, which have not been company has
deposited on account of any dispute except the been overstated.
following:
Period Amount
Forum where the
of in `
dispute is pending
Dispute lakhs
Commissioner of AY 3.92
Income tax (Appeals), 2010-11
Kottayam
Commissioner of AY 150.34
Income tax (Appeals), 2011-12
Kottayam
Commissioner of AY 63.28
Income tax (Appeals), 2012-13
Kottayam
Commissioner of AY 288.57
Income tax (Appeals), 2012-13
Kottayam
CPC AY 0.57
2013-14
CPC AY 191.84
2013-14
Deputy Commissioner, FY 4.59
Dept. of Commercial 2012-13
Taxes, Ernakulam
2017-18 According to the information and explanations Since the The Company has
provided to us: company has taken insurance
already created cover for such losses
a) there have been certain instances of fraud by 100% provision and has filed
employees of the Company amounting to `42.96 for all applicable Insurance claims in
lakhs across 2 branches of the company of which cases, No further this regard. Further,
`19.16 lakhs have been recovered during the period. impact on the the Company has
financial filed police cases and
statements. is in the process of
recovering these
amounts from the
employees and
taking legal actions,
where applicable.
2018-19 According to the information and explanations given Since the The Company has
to us, fraud on the Company amounting to `206.76 company has taken insurance
lakhs across two branches of the Company during already created cover for such losses

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Impact on the
Financial
Corrective steps
Financial statements and
Summary of Other Observations taken and proposed
Year financial
to be taken
position of the
Issuer
the current year by its officers or employees has been 100% provision and has filed
noticed. Out of this amount, `16.09 lakhs were for all applicable Insurance claims in
recovered. cases, No further this regard. Further,
impact on the the Company has
financial filed police cases and
statements. is in the process of
recovering these
amounts from the
employees and
taking legal actions,
where applicable.
2019-20 According to the information and explanations given to us To the extent of tax Appeal has been filed in
and the records of the Company examined by us, there are not paid, profit all cases.
no dues of income tax, sales tax, service tax, duty of /general reserve of
customs, duty of excise and value added tax, which have the company has
not been deposited on account of any dispute except the been overstated.
following:
Forum where the Period of Amount
dispute is pending Dispute in ` lakhs
Commissioner of Income- AY 2013- 159.87
tax (Appeals), Kochi 14
Commissioner of Income- AY 2015- 216.15
tax (Appeals), Kochi 16
Commissioner of Income- AY 2016- 136.30
tax (Appeals), Kochi 17
Commissioner of Income- AY 2017- 94.86
tax (Appeals), Kochi 18

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OTHER REGULATORY AND STATUTORY DISCLOSURES

Authority for the Issue

At the meeting of the Board of Directors of our Company held on July 20, 2020, the Directors approved the issue
of NCDs to the public up to an amount not exceeding `40,000 lakhs for the financial year 2020-2021.

This Issue for an amount not exceeding `20,000 lakhs has been approved by the Debenture Committee in its
meeting dated July 20, 2020.

Prohibition by SEBI

Our Company, persons in control of our Company, Directors of our Company and/or our Promoters have not been
restrained, prohibited or debarred by SEBI from accessing the securities market or dealing in securities and no
such order or direction is in force. Further, no member of our promoter group has been prohibited or debarred by
SEBI from accessing the securities market or dealing in securities due to fraud.

Categorisation as a Wilful Defaulter

Our Company, our Directors and/or our Promoters have not been categorised as a Wilful Defaulter nor are they
in default of payment of interest or repayment of principal amount in respect of debt securities issued to the public,
for a period of more than six-months.

Declaration as a Fugitive Economic Offender

None of our Promoters or Directors have been declared as a Fugitive Economic Offender.

Other confirmations

None of our Company or our Directors or our Promoters, or person(s) in control of our Company was a promoter,
director or person in control of any company which was delisted within a period of ten years preceding the date
of this Prospectus, in accordance with Chapter V of the SEBI Delisting Regulations.

Disclaimer

IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF THE PROSPECTUS TO THE

SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI) SHOULD NOT IN ANY WAY BE
DEEMED OR CONSTRUED THAT THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI.
SEBI DOES NOT TAKE ANY RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF
ANY SCHEME OR THE PROJECT FOR WHICH THE ISSUE IS PROPOSED TO BE MADE OR FOR
THE CORRECTNESS OF THE STATEMENTS MADE OR OPINIONS EXPRESSED IN
THEPROSPECTUS. THE LEAD MANAGER, VIVRO FINANCIAL SERVICES PRIVATE LIMITED,
HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE PROSPECTUS ARE GENERALLY
ADEQUATE AND ARE IN CONFORMITY WITH THE SEBI (ISSUE AND LISTING OF DEBT
SECURITIES) REGULATIONS, 2008 IN FORCE FOR THE TIME BEING. THIS REQUIREMENT IS
TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING INVESTMENT
IN THE PROPOSED ISSUE.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER IS PRIMARILY

RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT
INFORMATION IN THE PROSPECTUS, THE LEAD MANAGER IS EXPECTED TO EXERCISE DUE
DILIGENCE TO ENSURE THAT THE ISSUER DISCHARGES ITS RESPONSIBILITY
ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE, THE LEAD MANAGER VIVRO
FINANCIAL SERVICES PRIVATE LIMITED, HAS FURNISHED TO SEBI A DUE DILIGENCE
CERTIFICATE DATED SEPTEMBER 7, 2020, WHICH READS AS FOLLOWS:

1. WE CONFIRM THAT NEITHER THE ISSUER NOR ITS PROMOTERS OR DIRECTORS HAVE
BEEN PROHIBITED FROM ACCESSING THE CAPITAL MARKET UNDER ANY ORDER OR
DIRECTION PASSED BY THE BOARD. WE ALSO CONFIRM THAT NONE OF THE

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 Muthoottu Mini Financiers Limited

INTERMEDIARIES NAMED IN THE PROSPECTUS HAVE BEEN DEBARRED FROM

FUNCTIONING BY ANY REGULATORY AUTHORITY.

2. WE CONFIRM THAT ALL THE MATERIAL DISCLOSURES IN RESPECT OF THE ISSUER

HAVE BEEN MADE IN THE PROSPECTUS AND CERTIFY THAT ANY MATERIAL
DEVELOPMENT IN THE ISSUE OR RELATING TO THE ISSUE UP TO THE
COMMENCEMENT OF LISTING AND TRADING OF THE NCDs OFFERED THROUGH THIS
ISSUE SHALL BE INFORMED THROUGH PUBLIC NOTICES/ADVERTISEMENTS IN ALL
THOSE NEWSPAPERS IN WHICH PRE-ISSUE ADVERTISEMENT AND ADVERTISEMENT
FOR OPENING OR CLOSURE OF THE ISSUE HAVE BEEN GIVEN.

3. WE CONFIRM THAT THE PROSPECTUS CONTAINS ALL DISCLOSURES AS SPECIFIED IN

THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE AND LISTING OF DEBT
SECURITIES) REGULATIONS, 2008, AS AMENDED.

4. WE ALSO CONFIRM THAT ALL RELEVANT PROVISIONS OF THE COMPANIES ACT, 1956,
COMPANIES ACT, 2013, SECURITIES CONTRACTS (REGULATION) ACT, 1956, SECURITIES
AND EXCHANGE BOARD OF INDIA ACT, 1992 AND THE RULES, REGULATIONS,
GUIDELINES, CIRCULARS ISSUED THEREUNDER ARE COMPLIED WITH.

5. WE CONFIRM THAT NO COMMENTS/COMPLAINTS WERE RECEIVED ON THE DRAFT

PROSPECTUS HOSTED ON THE WEBSITE OF BSE (DESIGNATED STOCK EXCHANGE).

Disclaimer Clause of BSE

BSE LIMITED (“THE EXCHANGE”) HAS GIVEN, VIDE ITS LETTER DATED AUGUST 27, 2020,
PERMISSION TO THIS COMPANY TO USE THE EXCHANGE’S NAME IN THIS PROSPECTUS AS
THE STOCK EXCHANGE ON WHICH THIS COMPANY’S SECURITIES ARE PROPOSED TO BE
LISTED. THE EXCHANGE HAS SCRUTINIZED THIS PROSPECTUS FOR ITS LIMITED
INTERNAL PURPOSE OF DECIDING ON THE MATTER OF GRANTING THE AFORESAID
PERMISSION TO THIS COMPANY. THE EXCHANGE DOES NOT IN ANY MANNER:

(a) WARRANT, CERTIFY OR ENDORSE THE CORRECTNESS OR COMPLETENESS OF ANY OF

THE CONTENTS OF THIS PROSPECTUS; OR
(b) WARRANT THAT THIS COMPANY’S SECURITIES WILL BE LISTED OR WILL CONTINUE
TO BE LISTED ON THE EXCHANGE; OR
(c) TAKE ANY RESPONSIBILITY FOR THE FINANCIAL OR OTHER SOUNDNESS OF THIS
COMPANY, ITS PROMOTERS, ITS MANAGEMENT OR ANY SCHEME OR PROJECT OF THIS
COMPANY;

AND IT SHOULD NOT FOR ANY REASON BE DEEMED OR CONSTRUED THAT THIS
PROSPECTUS HAS BEEN CLEARED OR APPROVED BY THE EXCHANGE. EVERY PERSON WHO
DESIRES TO APPLY FOR OR OTHERWISE ACQUIRES ANY SECURITIES OF THIS COMPANY
MAY DO SO PURSUANT TO INDEPENDENT INQUIRY, INVESTIGATION AND ANALYSIS AND
SHALL NOT HAVE ANY CLAIM AGAINST THE EXCHANGE WHATSOEVER BY REASON OF
ANY LOSS WHICH MAY BE SUFFERED BY SUCH PERSON CONSEQUENT TO OR IN
CONNECTION WITH SUCH SUBSCRIPTION/ACQUISITION WHETHER BY REASON OF
ANYTHING STATED OR OMITTED TO BE STATED HEREIN OR FOR ANY OTHER REASON
WHATSOEVER.

Disclaimer Clause of RBI

THE COMPANY IS HAVING A VALID CERTIFICATE OF REGISTRATION DATED APRIL 13, 2002
AND A FRESH CERTIFICATE OF REGISTRATION DATED JANUARY 1, 2014 BEARING
REGISTRATION NO. N-16.00175 ISSUED BY THE RESERVE BANK OF INDIA UNDER SECTION 45
IA OF THE RESERVE BANK OF INDIA ACT, 1934. HOWEVER, RBI DOES NOT ACCEPT ANY
RESPONSIBILITY OR GUARANTEE ABOUT THE PRESENT POSITION AS TO THE FINANCIAL
SOUNDNESS OF THE COMPANY OR FOR THE CORRECTNESS OF ANY OF THE STATEMENTS

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OR REPRESENTATIONS MADE OR OPINIONS EXPRESSED BY THE COMPANY AND FOR

REPAYMENT OF DEPOSITS/DISCHARGE OF LIABILITY BY THE COMPANY.
Disclaimer clause of IRR Advisory Services Private Limited

Following is the disclaimer clause of IRR Advisory Services Private Limited in relation to the IRR Report:

THIS REPORT IS PREPARED BY IRR ADVISORY SERVICES PVT LTD (IRR ADVISORY). IRR
ADVISORY HAS TAKEN UTMOST CARE TO ENSURE ACCURACY AND OBJECTIVITY WHILE
DEVELOPING THIS REPORT. IRR ADVISORY IS NOT RESPONSIBLE FOR ANY ERRORS OR
OMISSIONS IN ANALYSIS/INFERENCES/VIEWS OR FOR RESULTS OBTAINED FROM THE USE
OF INFORMATION CONTAINED IN THIS REPORT AND ESPECIALLY STATES THAT IRR
ADVISORY HAS NO FINANCIAL LIABILITY WHATSOEVER TO THE USER OF THIS REPORT.
THIS REPORT IS FOR THE INFORMATION OF THE INTENDED RECIPIENTS ONLY AND NO
PART OF THIS REPORT MAY BE PUBLISHED OR REPRODUCED IN ANY FORM OR MANNER
WITHOUT PRIOR WRITTEN PERMISSION OF IRR ADVISORY.

DISCLAIMER CLAUSE OF INDIA RATINGS AND RESEARCH PRIVATE LIMITED

ALL CREDIT RATINGS ASSIGNED BY INDIA RATINGS ARE SUBJECT TO CERTAIN

LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMIATIONS AND DISCLAIMERS BY
FOLLOWING THIS LINK: HTTPS://[Link]/RATING-DEFINITIONS. IN
ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE
AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE [Link] PUBLISHED
RATINGS, CRITERIA, AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL
TIMES. INDIA RATINGS’ CODE OF CONDUCT, CONFIDENTIALTY, CONFLICTS OF INTEREST,
AFFILIATE FIREWALL, COMPLIANCE, AND OTHER RELEVANT POLICIES AND PROCEDURES
ARE ALSO AVAILABLE FROM THE CODE OF CONDUCT SECTION OF THIS SITE.

Track record of past public issues handled by the Lead Manager

The track record of past issues handled by the Lead Manager, as required by SEBI circular number
CIR/MIRSD/1/2012 dated January 10, 2012, are available at the following website:

Name of Lead Manager Website

Vivro Financial Services Private Limited [Link]

Listing

An application will be made to BSE for permission to deal in and for an official quotation of our NCDs. BSE has
been appointed as the Designated Stock Exchange.

If permissions to deal in and for an official quotation of our NCDs are not granted by BSE, our Company will
forthwith repay, without interest, all moneys received from the Applicants in pursuance of this Prospectus.

Our Company shall ensure that all steps for the completion of the necessary formalities for listing and
commencement of trading at the Stock Exchange mentioned above are taken within 6 Working Days from the
date of closure of the issue.

Consents

Consents in writing of Directors of our Company, Company Secretary and Compliance Officer, Chief Financial
Officer, Statutory Auditors, legal advisor to the Issue, Lead Manager, the Registrar to the Issue, Credit Rating
Agency, the Bankers to our Company, Public Issue Account Bank, Refund Bank, Syndicate Member, the
Debenture Trustee, IRR, the lenders to the Company to act in their respective capacities, have been obtained and
will be filed along with a copy of this Prospectus with the RoC as required under Section 26 of the Companies
Act, 2013. Further such consents have not been withdrawn up to the time of delivery of this Prospectus with the
RoC.

Expert Opinion

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 Muthoottu Mini Financiers Limited

Except as stated below, our Company has not obtained any expert opinions:

(a) Our Company has received written consent from the Statutory Auditor, namely Vishnu Rajendran & Co., to
include its name as required under Section 26(1)(a)(v) of the Companies Act, 2013 in this Prospectus and as
an “expert” as defined under Section 2(38) of the Companies Act, 2013 to the extent and in its capacity as a
statutory auditor, in respect of the (a) Audited Ind AS Financial Statement issued by the Statutory Auditors
dated July 20, 2020; (b) Reformatted Financial Statement dated August 14, 2020; and (c) its report dated
August 14, 2020 on the statement of tax benefits, included in this Prospectus. The consent of the Statutory
Auditors has not been withdrawn as on the date of this Prospectus.

(b) Our Company has received written consent from India Ratings to include the credit rating rationale letter
dated August 14, 2020 in respect of the credit rating issued for the NCDs to be issued pursuant to this Issue
which furnishes the rationale for its rating.

Common form of Transfer

We undertake that there shall be a common form of transfer for the NCDs held in dematerialised form shall be
transferred subject to and in accordance with the rules/procedures as prescribed by NSDL/CDSL and the relevant
Depositary Participants of the transferor or transferee and any other applicable laws and rules notified in respect
thereof.

Filing of the Draft Prospectus

The Draft Prospectus has been filed with the Designated Stock Exchange in terms of Regulation 6 of the SEBI
Debt Regulations for dissemination on its website(s) prior to the opening of the Issue.

Filing of this Prospectus

This Prospectus shall be filed with the RoC in accordance with Section 26 of the Companies Act, 2013.

Debenture Redemption Reserve (“DRR”)

Pursuant to Regulation 16 of the SEBI Debt Regulations and Section 71(4) of the Companies Act, 2013 states that
where debentures are issued by any company, the company shall create a debenture redemption reserve out of the
profits of the company available for payment of dividend. Rule 18(7) of the Companies (Share Capital and
Debentures) Rules, 2014, as amended by Companies (Share Capital and Debentures) Amendment Rules, 2019,
listed NBFC is not required to create a DRR in case of public issue of debentures. The rules further mandate that
the company which is coming with a Public Issue shall deposit or invest, as the case may be, before the 30 th day
of April of each year a sum which shall not be less than 15% of the amount of its debentures maturing during the
year ending on the 31st day of March of the next year in any one or more prescribed methods.

Accordingly, our Company is not required to create a DRR for the NCDs proposed to be issued through this Issue.
Further, our Company shall deposit or invest, as the case may be, before the 30th day of April of each year a sum
which shall not be less than 15% of the amount of its debentures maturing during the year ending on the 31st day
of March of the next year in any one or more following methods: (a) in deposits with any scheduled bank, free
from charge or lien; (b) in unencumbered securities of the Central Government or of any State Government; (c)
in unencumbered securities mentioned in clauses (a) to (d) and (ee) of Section 20 of the Indian Trusts Act, 1882;
(d) in unencumbered bonds issued by any other company which is notified under clause (f) of Section 20 of the
Indian Trusts Act, 1882. The abovementioned amount deposited or invested, must not be utilized for any purpose
other than for the repayment of debentures maturing during the year provided that the amount remaining deposited
or invested must not at any time fall below 15% of the amount of debentures maturing during year ending on the
31st day of March of that year, in terms of the applicable laws.

Issue related expenses

For details of Issue related expenses, see “Objects of the Issue” on page 61.

Reservation

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 Muthoottu Mini Financiers Limited

No portion of this Issue has been reserved.

Details regarding the Company and other listed companies which are associate companies as described
under the Companies Act, 2013, which made any capital issue during the last three years

Except as disclosed below, there are no other listed companies under the same management / associate companies
as described under the Companies Act, 2013, which have made any public capital issuances during the previous
three years from the date of this Prospectus.

Public issue of Equity Shares

Our Company has not made any public issue of Equity Shares or rights issuances in the last five years.

Previous Public Issues of Non-Convertible Debenture

Other than the Public Issue 1, Public Issue 2, Public Issue 3, Public Issue 4, Public Issue 5, Public Issue 6, Public
Issue 7, Public Issue 8, Public Issue 9 and Public Issue 10, our Company has previously not made any public
issues of non-convertible debentures.

Other than as specifically disclosed in this Prospectus, our Company has not issued any securities for consideration
other than cash.

Dividend

Our Company has no formal dividend policy. The declaration and payment of dividends on our Equity Shares will
be recommended by the Board of Directors and approved by our Shareholders, at their discretion, and will depend
on a number of factors, including but not limited to our profits, capital requirements and overall financial
condition. Our Company has not declared any dividend during the last 5 Fiscals.

Jurisdiction

Exclusive jurisdiction for the purpose of the Issue is with the competent courts of jurisdiction in Kochi, India.

Commissions and Brokerage on previous issue

1. An expense of `139.66 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured non-convertible debentures of face value `1,000.00 each aggregating to `19,558.57 lakhs
pursuant to the prospectus dated February 12, 2014.

2. An expense of `189.00 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured and unsecured non-convertible debentures of face value `1,000 each aggregating to
`24,962.99 lakhs pursuant to the prospectus dated July 7, 2014.

3. An expense of `203.00 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured and unsecured non-convertible debentures of face value `1,000 each aggregating to
`26,912.88 lakhs pursuant to the prospectus dated September 23, 2014.

4. An expense of `97.65 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured and unsecured non-convertible debentures of face value `1,000 each aggregating to `24,909
lakhs pursuant to the prospectus dated February 18, 2015.

5. An expense of `48.45 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured non-convertible debentures of face value `1,000 each aggregating to `22,827.12 lakhs
pursuant to the prospectus dated July 10, 2015.

6. An expense of `41.24 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured and unsecured non-convertible debentures of face value `1,000 each aggregating to
`24,400.75 lakhs pursuant to the prospectus dated December 21, 2015.

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 Muthoottu Mini Financiers Limited

7. An expense of `41.38 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured non-convertible debentures of face value `1,000 each aggregating to `11,671.79 lakhs
pursuant to the prospectus dated March 12, 2019.

8. An expense of `47.21 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured non-convertible debentures of face value `1,000 each aggregating to `13,203.38 lakhs
pursuant to the prospectus dated July 29, 2019.

9. An expense of `105.31 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured non-convertible debentures of face value `1,000 each aggregating to `17,593 lakhs pursuant
to the prospectus dated January 14, 2020.

10. An expense of `101.07 lakhs was incurred towards commission and brokerage in connection with the public
issue of secured non-convertible debentures of face value `1,000 each aggregating to `19,790.67 lakhs
pursuant to the prospectus dated May 29, 2020.

Impersonation

As a matter of abundant caution, attention of the Investors is specifically drawn to the provisions of sub-section
(1) of Section 38 of the Companies Act, 2013 which is reproduced below:

“Any person who:

(a) makes or abets making of an application in a fictitious name to a company for acquiring, or subscribing
for, its securities; or

(b) makes or abets making of multiple applications to a company in different names or in different
combinations of his name or surname for acquiring or subscribing for its securities; or

(c) otherwise induces directly or indirectly a company to allot, or register any transfer of, securities to him,
or to any other person in a fictitious name, shall be liable for action under Section 447.”

The liability prescribed under Section 447 of the Companies Act 2013 for fraud involving an amount of at least
`10 lakh or 1.00% of the turnover of the Company, whichever is lower, includes imprisonment for a term which
shall not be less than six months extending up to 10 years (provided that where the fraud involves public interest,
such term shall not be less than three years) and fine of an amount not less than the amount involved in the fraud,
extending up to three times of such amount. In case the fraud involves (i) an amount which is less than `10 lakh
or 1.00% of the turnover of the Company, whichever is lower; and (ii) does not involve public interest, then such
fraud is punishable with an imprisonment for a term extending up to five years or a fine of an amount extending
up to `50 lakh or with both.

Details regarding lending out of issue proceeds of Previous Issues

A. Lending Policy

Please refer to “Our Business - Gold Loan Business” on page 93.

B. Loans given by the Company

Our Company has not provided any loans/advances to associates, entities/persons relating to Board, senior
management or Promoters out of the proceeds of previous issues.

Utilisation of Issue Proceeds of the previous issues by our Company and Group Companies

Our Company

(`in lakhs)

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Public
Particulars of Public Public Public Public Public Public Public Public Public
No Issue
utilization Issue 1 Issue 2 Issue 3 Issue 4 Issue 5 Issue 6 Issue 7 Issue 8 Issue 9
10
Total Issue 19,559 24,963 26,913 24,909 22,827 24,401 11,672 13,203 17,593 19,791
Proceeds
(a) Issue Related 377 291 303 274 257 111 149 177 352 282
Expense
Issue Proceed 19,182 24,672 26,610 24,635 22,570 24,290 11,523 13,026 17,241 19,509
Less Issue
Expenses
1. Onward lending 19,182 4,648 14,602 11,117 2,762 14,107 7,932 5,814 13,502 16,426
2. Repayment of - 16,450 10,072 11,286 18,330 10,156 1,688 7,212
existing loans
including interest
3. General Corporate - 3,574 1,936 2,232 1,478 27 1,903 - 3,739 3,083
Purposes

C. Group Companies

Nil

D. Type of loans

Classification of loans/advances given

The detailed breakup of the types of loans given by the Company as on March 31, 2020 is as follows:

(`in lakhs)
No. Type of Loans Amount

1. Secured 1,64,572.21
2. Unsecured 4,537.76
Total assets under management (AUM) 1,69,109.97

E. Sectoral Exposure as on March 31, 2020

Percentage of
No. Segment wise break up of AUM
AUM (%)
1. Retail
(a) Mortgages (home loans and loans against property) 0.05
(b) Gold loans 97.27
(c) Vehicle finance -
(d) MFI 2.68
(e) M & SME -
(f) Capital market funding (loans against shares, margin funding) -
(g) Others -
2. Wholesale -
(a) Infrastructure -
(b) Real estate (including builder loans) -
(c) Promoter funding -
(d) Any other sector (as applicable) -
(e) Others -
Total 100.00

F. Residual Maturity Profile of Assets and Liabilities as on March 31, 2020

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(in ` lakhs)
More
More More than More More
than 2 More than More
Up to 30/31 than 1 3 months than 1 than 3
months 6 months than 5 Total
days month to to 6 year to 3 years to 5
to 3 to 1 year years
2 months months years years
months
Deposit - - - - - - - - -
Advances 32,456.12 14,238.26 13,525.37 79,450.99 25,478.52 3,960.71 - - 1,69,109.97
Investments - - - - - - - 3.24 3.24
Borrowings 464.52 13,829.94 1,138.46 6,774.51 49,227.58 62,582.89 19,142.62 17.68 1,53,178.20
Foreign - - - - - - - - -
Currency
Assets
Foreign - - - - - - - - -
Current
Liabilities

G. Denomination of the loans outstanding by ticket size as on March 31, 2020*

Percentage of AUM
No. Ticket size**
(%)
1. Up to 2 lakhs 92.37
2. 2 lakhs to 5 lakhs 6.27
3. 5 lakhs to 10 lakhs 0.97
4. 10 lakhs to 25 lakhs 0.18
5. 25 lakhs to 50 lakhs 0.07
6. 50 lakhs to 1 crore 0.14
7. 1 crore to 5 crores -
8. 5 crores to 25 crores -
9. 25 crores to 100 crores -
10. Above 100 cores -
Total 100.00
* Ticket size at the time of origination
**The details provided are as per borrower and not as per loan account.

H. Denomination of loans outstanding by LTV as on March 31, 2020*

Percentage of AUM
No. LTV
(%)
1. Up to 40% 1.15
2. 40%-50% 2.21
3. 50%-60% 9.47
4. 60%-70% 19.00
5. 70%-80% 68.17
6. 80%-90% -
7. More than 90% -
Total 100.00
*LTV at the time of origination

I. Geographical classification of our borrowers as on March 31, 2020

Percentage of AUM
No. Top 5 states
(%)
1. Tamil Nadu 39.74
2. Andhra Pradesh & Telangana 22.67
3. Karnataka 20.02
4. Kerala 13.02

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Percentage of AUM
No. Top 5 states
(%)
5. Delhi (including NCR) 1.63
Total 97.08

J. (a) Details of top 20 borrowers with respect to concentration of advances as on March 31, 2020

(in ` lakhs)
Particulars Amount
Total advances to twenty largest borrowers 463.71
Percentage of Advances to twenty largest borrowers 0.27%
to Total Advances to our Company

(b) Details of top 20 borrowers with respect to concentration of exposure as on March 31, 2020

(in ` lakhs)
Amount
Particulars
Secured Unsecured
Total exposure to twenty largest borrowers 463.71 14.02
Percentage of exposure to twenty largest borrowers to Total exposure to 0.28% 0.31%
our Company

K. Details of loans overdue and classified as non-performing in accordance with the RBI’s guidelines as on
March 31, 2020

(in ` lakhs)
Movement of gross NPA Amount
Opening gross NPA 2,987.43
- Additions during the year 2,252.93
- Reductions during the year 2,050.22
Closing balance of gross NPA 3,190.14
Movement of net NPA
Opening net NPA 1,896.97
- Additions during the year 1,763.10
- Reductions during the year 1,401.68
Closing balance of net NPA 2,258.39

Movement of provisions for NPA

Opening balance 1,090.47
- Provisions made during the year 489.83
- Write-off / write-back of excess provisions 648.54
Closing balance 931.76

L. Segment-wise gross NPA as on March 31, 2020

No. Segment wise break up of gross NPA Gross NPA (%)*

1. Retail
(a) Mortgages (home loans and loans against property) 100
(b) Gold Loans 1.85
(c) Vehicle Finance -
(d) MFI 1.21
(e) M & SME -
(f) Capital market funding (loans against shares, margin funding) -
(g) Others -
2. Wholesale -

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No. Segment wise break up of gross NPA Gross NPA (%)*

(a) Infrastructure -
(b) Real Estate (including builder loans) -
(c) Promoter funding -
(d) Any other sector (as applicable) -
(e) Others -
Total of Gross NPA 1.89
* Gross NPA means percentage of NPAs to total advances in that sector

M. Classification of loans/advances given to associates, entities/person relating to the board, senior

management, promoters, others, etc. as on March 31, 2020:

(in ` lakhs)
Particulars Amount
Loans to Promoters -
Other Loans -

Revaluation of assets

Except the revaluation of fixed assets viz land during Fiscal 2012-13 for `4,600 lakhs, our Company has not
revalued its assets.

Mechanism for redressal of investor grievances

Agreement dated August 6, 2020 between the Registrar to the Issue and our Company provides for settling of
investor grievances in a timely manner and for retention of records with the Registrar to the Issue for a period of
eight years.

All grievances relating to the Issue may be addressed to the Registrar to the Issue and Compliance Officer giving
full details such as name, address of the Applicant, number of NCDs applied for, amount paid on Application and
the details of Member of Syndicate or Trading Member of the Stock Exchange where the Application was
submitted.

All grievances relating to the ASBA process may be addressed to the Registrar to the Issue with a copy to either
(a) the relevant Designated Branch of the SCSB where the Application Form was submitted by the ASBA
Applicant, or (b) the concerned Member of the Syndicate and the relevant Designated Branch of the SCSB in the
event of an Application submitted by an ASBA Applicant at any of the Syndicate ASBA Application Locations,
giving full details such as name, address of Applicant, Application Form number, option applied for, number of
NCDs applied for, amount blocked on Application.

We estimate that the average time required by us or the Registrar to the Issue for the redressal of routine investor
grievances will be three (3) Working Days from the date of receipt of the complaint.

In case of non-routine complaints and complaints where external agencies are involved, we will seek to redress
these complaints as expeditiously as possible.

Registrar to the Issue

Link Intime India Private Limited

C- 101, 247 Park
L.B.S. Marg, Vikhroli (West)
Mumbai 400 083
Maharashtra, India
Telephone: +91 22 4918 6200
Facsimile: +91 22 4918 6195
Email: ncd2.mmfl2020@[Link]
Investor Grievance mail: ncd2.mmfl2020@[Link]
Website: [Link]

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Contact Person: Shanti Gopalkrishnan

SEBI Registration Number: INR000004058

Compliance Officer of our Company

Smitha K. S. has been appointed as the Compliance Officer of our Company for this Issue. The contact details of
Compliance Officer of our Company are as follows:

Smitha K. S.
Muthoottu Royal Towers
Kaloor, Kochi – 682 017
Kerala, India
Telephone: +91 484 291 2178
Facsimile: NA
E-mail: cs@[Link]

Change in Auditors of our Company during the last three years

There has been no change in the auditor of our Company during the last three years.

Disclaimer statement from the Issuer

The Issuer accepts no responsibility for statements made other than in this Prospectus issued by our Company
in connection with the Issue of the NCDs and anyone placing reliance on any other source of information
would be doing so at his / her own risk.

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KEY REGULATIONS AND POLICIES

The regulations summarized below are not exhaustive and are only intended to provide general information to
Investors and are neither designed nor intended to be a substitute for any professional legal advice. Taxation
statutes such as the IT Act, GST laws (including CGST, SGST and IGST) and applicable local sales tax statutes,
labour regulations such as the Employees State Insurance Act, 1948 and the Employees Provident Fund and
Miscellaneous Provisions, Act, 1952, and other miscellaneous regulations such as the Trade Marks Act, 1999 and
applicable Shops and Establishments statutes apply to us as they do to any other Indian company and therefore
have not been detailed below.

The following description is a summary of certain sector specific laws and regulations in India, which are
applicable to our Company. The information detailed in this chapter has been obtained from publications
available in the public domain. The regulations set out below may not be exhaustive and are only intended to
provide general information to the investors and are neither designed nor intended to substitute for professional
legal advice. The statements below are based on the current provisions of the Indian law, and the judicial and
administrative interpretations thereof, which are subject to change or modification by subsequent legislative,
regulatory, administrative or judicial decisions.

We are a non-deposit taking (which does not accept public deposits), systemically important, NBFC. As such, our
business activities are regulated by RBI regulations applicable to non-public deposit accepting NBFCs (“NBFC-
ND”).

As of November 22, 2019, the RBI has issued an updated Master Direction - Non-Banking Financial Company -
Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions,
2016, dated September 1, 2016 as amended, (“Master Directions”) applicable to all NBFC-NDSI’s.

Following are the regulations governing an NBFC in India:

Regulations governing NBFCs

As per the RBI Act, a financial institution has been defined as a company which includes a non-banking institution
carrying on as its business or part of its business the financing activities, whether by way of making loans or
advances or otherwise, of any activity, other than its own and it is engaged in the activities of loans and advances,
acquisition of shares/stock/bonds/debentures/securities issued by the Government of India or other local
authorities or other marketable securities of like nature, leasing, hire-purchase, insurance business, chit business
but does not include any institution whose principal business is that of carrying out any agricultural or industrial
activities or the purchase or sale of any goods or providing of any service or the sale/purchase/construction of
immovable property.

As per the prescribed law any company that carries on the business of a non-banking financial institution as its
‘principal business’ is to be treated as an NBFC. The term ‘principal business’ has not been defined in any statute;
however, RBI has clarified through a press release (Ref. No. 1998-99/1269) issued in 1999, that in order to identify
a particular company as an NBFC, it will consider both the assets and the income pattern as evidenced from the
last audited balance sheet of the company to decide a company’s principal business. The company will be treated
as an NBFC if its financial assets are more than 50% of its total assets (netted off by intangible assets) and income
from financial assets should be more than 50% of the gross income. Both these tests are required to be satisfied
in order to determine the principal business of a company.

With effect from 1997, NBFCs were not permitted to commence or carry on the business of a non-banking
financial institution without obtaining a Certificate of Registration (“CoR”). Further, with a view to imparting
greater financial soundness and achieving the economies of scale in terms of efficiency of operations and higher
managerial skills, the RBI has raised the requirement of minimum net owned fund (“NoF”) from `25 lakhs to
`200 lakhs for the NBFC which commences business on or after April 21, 1999. Also, it was mandatory for all
NBFCs to attain a minimum NoF of `200 lakhs by the end of 1 April 2017. NBFCs failing to maintain NOF of
`200 lakhs are not eligible to hold a certificate of registration as an NBFC.

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Regulation of NBFC registered with RBI

NBFCs are primarily governed by the RBI Act and the RBI Master Directions. In addition to these regulations,
NBFCs are also governed by various circulars, notifications, guidelines and directions issued by the RBI from
time to time.

Types of Activities that NBFCs are permitted to carry out

Although by definition, NBFCs are permitted to operate in similar sphere of activities as banks, there are a few
important and key differences. The most important distinctions are:

(i) an NBFC cannot accept deposits repayable on demand – in other words, NBFCs can only accept fixed
term deposits. Thus, NBFCs are not permitted to issue negotiable instruments, such as cheques which
are payable on demand; and

(ii) NBFCs do not form part of the payment and settlement system and cannot issue cheques drawn on itself.

Types of NBFCs

Section 45-IA of the RBI Act makes it mandatory for every NBFC to get itself registered with the RBI in order to
be able to commence any of the aforementioned activities.

Further, an NBFC may be registered as a deposit accepting NBFC (“NBFC-D”) or as a non-deposit accepting
NBFC (“NBFC-ND”). NBFCs registered with RBI are further classified as:

The RBI has recently harmonised the categories of NBFCs into: (i) investment and credit companies (which
erstwhile consisted of asset finance companies, investment companies, and loan companies); (ii) infrastructure
finance companies; (iii) infrastructure debt funds; (iv) NBFC – micro finance institutions; and (v) NBFC – factors.

Our Company has been classified as an NBFC-ND-SI.

Systemically Important NBFC-NDs

As per the NBFC Master Directions, the revised the threshold for defining systemic significance for NBFCs-ND
in the light of the overall increase in the growth of the NBFC sector. NBFCs-ND-SI will henceforth be those
NBFCs-ND which have asset size of `50,000 lakh and above as per the last audited balance sheet. Moreover, as
per this amendment, all NBFCs-ND with assets of `50,000 lakh and above, irrespective of whether they have
accessed public funds or not, shall comply with prudential regulations as applicable to NBFCs-ND-SI. NBFCs-
ND-SI is required to comply with conduct of business regulations if customer interface exists.

All systemically important NBFCs are required to maintain a minimum Capital to Risk-Weighted Assets Ratio of
15 per cent.

Rating of NBFCs

Pursuant to the RBI Master Directions, all NBFCs with an asset size of `50,000 lakhs are required to, as per RBI
instructions to, furnish information about downgrading or upgrading of the assigned rating of any financial product
issued by them within 15 days of a change in rating.

Provisioning Requirements

An NBFC-ND, after taking into account the time lag between an account becoming non-performing, its
recognition, the realisation of the security and erosion overtime in the value of the security charged, shall make
provisions against sub-standard assets, doubtful assets and loss assets in the manner provided for in the Master
Directions.

In the interests of counter cyclicality and so as to ensure that NBFCs create a financial buffer to protect them from
the effect of economic downturns, RBI vide their circular no. [Link]. No.207/ 03.02.002 /2010-11 dated
January 17, 2011, introduced provisioning for Standard Assets by all NBFCs. NBFCs are required to make a
general provision at 0.25 per cent of the outstanding standard assets. RBI vide their circular no. DNBR (PD) CC

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No. 037/03.01.001/2014-15 dated June 11, 2015 raised the provision for standard assets to 0.40 per cent to be met
by March 2018. The provisions on standard assets are not reckoned for arriving at Net NPAs. The provisions
towards Standard Assets are not needed to be netted from gross advances but shown separately as ‘Contingent
Provisions against Standard Assets’ in the balance sheet. NBFCs are allowed to include the ‘General Provisions
on Standard Assets’ in Tier II Capital which together with other ‘general provisions/ loss reserves’ will be admitted
as Tier II Capital only up to a maximum of 1.25 per cent of the total risk-weighted assets.

Capital Adequacy Norms

Every systemically important NBFC-ND is required to maintain, a minimum capital ratio consisting of Tier I and
Tier II Capital of not less than 15 per cent of its aggregate risk weighted assets on balance sheet and of risk adjusted
value of off-balance sheet items is required to be maintained. Also, the total of the Tier II Capital of a NBFC-MFI
shall not exceed 100 per cent of the Tier I Capital.

Tier-I Capital, has been defined as, owned funds as reduced by investment in shares of other NBFCs and in shares,
debentures, bonds, outstanding loans and advances including hire purchase and lease finance made to and deposits
with subsidiaries and companies in the same group exceeding, in aggregate, 10 per cent of the owned fund and
perpetual debt instruments issued by a systemically important NBFC-ND in each year to the extent it does not
exceed 15 per cent of the aggregate Tier I Capital of such company as on 31 st March of the previous accounting
year.

Owned Funds, has been defined as, paid-up equity capital, preference shares which are compulsorily convertible
into equity, free reserves, balance in share premium account; capital reserve representing surplus arising out of
sale proceeds of asset, excluding reserves created by revaluation of assets; less accumulated loss balance, book
value of intangible assets and deferred revenue expenditure, if any.

Tier - II Capital includes the following (a) preference shares other than those which are compulsorily convertible
into equity; (b) revaluation reserves at discounted rate of 55 per cent; (c) general provisions (including that for
standard assets) and loss reserves to the extent these are not attributable to actual diminution in value or identifiable
potential loss in any specific asset and are available to meet unexpected losses, to the extent of one-and-one-fourth
per cent of risk weighted assets; (d) hybrid debt capital instruments; and (e) subordinated debt to the extent the
aggregate does not exceed Tier - I capital; and (f) perpetual debt instrument issued by a systemically important
NBFC-ND, which is in excess of what qualifies for Tier I Capital to the extent that the aggregate Tier-II capital
does not exceed 15 per cent of the Tier -I capital.
Hybrid debt means, capital instrument, which possess certain characteristics of equity as well as debt.

Subordinated debt means a fully paid up capital instrument, which is unsecured and is subordinated to the claims
of other creditors and is free from restrictive clauses and is not redeemable at the instance of the holder or without
the consent of the supervisory authority of the NBFC. The book value of such instrument is subjected to
discounting as prescribed.

Exposure Norms

In order to ensure better risk management and avoidance of concentration of credit risks, the RBI has, in terms of
the Master Directions, prescribed credit exposure limits for financial institutions in respect of their lending to
single/ group borrowers. Credit exposure to a single borrower shall not exceed 15% of the owned funds of the
systemically important NBFC-ND, while the credit exposure to a single group of borrowers shall not exceed 25%
of the owned funds of the systemically important NBFC-ND. Further, the systemically important NBFCs-ND may
not invest in the shares of another company exceeding 15% of its owned funds, and in the shares of a single group
of companies exceeding 25% of its owned funds. However, this prescribed ceiling shall not be applicable on a
NBFC-ND-SI for investments in the equity capital of an insurance company to the extent specifically permitted
by the RBI. Any NBFC-ND-SI not accessing public funds, either directly or indirectly may make an application
to the RBI for modifications in the prescribed ceilings Any systemically important NBFC-ND classified as asset
finance company by RBI, may in exceptional circumstances, exceed the above ceilings by 5% of its owned fund,
with the approval of its Board of Directors. The loans and investments of the systemically important NBFC-ND
taken together may not exceed 25% of its owned funds to or in single party and 40% of its owned funds to or in
single group of parties. A systemically important ND-NBFC may, make an application to the RBI for modification
in the prescribed ceilings.

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Asset Classification

The Master Directions require that every NBFC shall, after taking into account the degree of well-defined credit
weaknesses and extent of dependence on collateral security for realisation, classify its lease/hire purchase assets,
loans and advances and any other forms of credit into the following classes:

• Standard assets;
• Sub-standard Assets;
• Doubtful Assets; and
• Loss assets

Further, such class of assets would not be entitled to be upgraded merely as a result of rescheduling, unless it
satisfies the conditions required for such upgradation. At present every NBFC is required to make a provision for
standard assets at 0.40 per cent.

Other stipulations

All NBFCs are required to frame a policy for demand and call loan that includes provisions on the cut-off date for
recalling the loans, the rate of interest, periodicity of such interest and periodical reviews of such performance.

The Master Directions also specifically prohibit NBFCs from lending against its own shares.

Net Owned Fund

Section 45-IA of the RBI Act provides that to carry on the business of a NBFC, an entity would have to register
as an NBFC with the RBI and would be required to have a minimum net owned fund of `200 lakh. For this
purpose, the RBI Act has defined “net owned fund” to mean:

Net Owned Fund - The aggregate of the paid-up equity capital and free reserves as disclosed in the latest balance
sheet of the company, after deducting (i) accumulated balance of losses, (ii) deferred revenue expenditure, (iii)
deferred tax asset (net); and (iv) other intangible assets; and further reduced by the amounts representing,

(i) investment by such companies in shares of (i) its subsidiaries, (ii) companies in the same group, (iii) other
NBFCs; and

(ii) the book value of debentures, bonds, outstanding loans and advances (including hire purchase and lease
finance) made to, and deposits with (i) subsidiaries of such companies; and (ii) companies in the same group,
to the extent such amount exceeds 10 per cent of (a) above.

Further, in accordance with RBI Notification No DNBR.007/CGM (CDS) 2015 dated 27 March 2015 which
provides that a non-banking financial company holding a certificate of registration issued by the RBI and having
net owned fund of less than `200 lakh may continue to carry on the business of non-banking financial institution,
if such company achieves net owned fund of:

(i) `100 lakh before April 1, 2016; and

(ii) `200 lakh before April 1, 2017

Reserve Fund

In addition to the above, Section 45-IC of the RBI Act requires NBFCs to create a reserve fund and transfer therein
a sum of not less than 20% of its net profits earned annually before declaration of dividend. Such a fund is to be
created by every NBFC irrespective of whether it is a ND NBFC or not. Such sum cannot be appropriated by the
NBFC except for the purpose as may be specified by the RBI from time to time and every such appropriation is
required to be reported to the RBI within 21 days from the date of such appropriation.

Maintenance of liquid assets

The RBI through notification dated January 31, 1998, as amended has prescribed that every NBFC shall invest
and continue to invest in unencumbered approved securities valued at a price not exceeding the current market
price of such securities an amount which shall, at the close of business on any day be not less than 10% in approved

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securities and the remaining in unencumbered term deposits in any scheduled commercial bank; the aggregate of
which shall not be less than 15% of the public deposit outstanding at the last working day of the second preceding
quarter.

NBFCs such as the Company, which do not accept public deposits, are subject to lesser degree of regulation as
compared to a NBFC-D and are governed by the RBI’s Non- Deposit Accepting Companies Directions.

An NBFC-ND is required to inform the RBI of any change in the address, telephone no’s, etc. of its Registered
Office, names and addresses of its directors/auditors, names and designations of its principal officers, the specimen
signatures of its authorised signatories, within one month from the occurrence of such an event. Further, an NBFC-
ND would need to ensure that its registration with the RBI remains current.

All NBFCs (whether accepting public deposits or not) having an asset base of `10,000 lakh or more or holding
public deposits of `20,000 lakh or more (irrespective of asset size) as per their last audited balance sheet are
required to comply with the RBI Guidelines for an Asset-Liability Management System.

Similarly, all NBFCs are required to comply with “Know Your Customer Guidelines - Anti Money Laundering
Standards” issued by the RBI, with suitable modifications depending upon the activity undertaken by the NBFC
concerned.

RBI vide circular bearing reference number RBI/2018-19/130 DNBR (PD) [Link].097/03.10.001/2018-19 dated
February 22, 2019, has harmonised different categories of NBFCs into fewer ones, based on the principle of
regulation by activity rather than regulation by entity. Accordingly, RBI has merged the three categories of NBFCs
viz. Asset Finance Companies (AFC), Loan Companies (LCs) and Investment Companies (ICs) into a new
category called NBFC - Investment and Credit Company (NBFC-ICC). Further differential regulations relating to
bank’s exposure to the three categories of NBFCs viz., AFCs, LCs and ICs were harmonised. Further, a deposit
taking NBFC-ICC shall invest in unquoted shares of another company which is not a subsidiary company or a
company in the same group of the NBFC, an amount not exceeding twenty per cent of its owned fund.

Lending against security of gold

The RBI pursuant to the Master Direction –Non-Banking Financial Company –Systemically Important Non
Deposit taking Company (Reserve Bank) Directions, 2016 dated September 1, 2016, as amended from time to
time (“RBI Master Directions”) has prescribed that all NBFCs shall maintain a loan to value ratio not exceeding
75% for loans granted against the collateral of gold jewellery. NBFCs primarily engaged in lending against gold
jewellery (such loans comprising 50% or more of their financial assets) shall maintain a minimum Tier l capital
of 12%. The RBI Master Directions has issued guidelines with regard to the following:

(i) Appropriate infrastructure for storage of gold ornaments: A minimum level of physical infrastructure and
facilities is available in each of the branches engaged in financing against gold jewellery including a safe
deposit vault and appropriate security measures for operating the vault to ensure safety of the gold and
borrower convenience. Existing NBFCs should review the arrangements in place at their branches and ensure
that necessary infrastructure is put in place at the earliest. No new branches should be opened without suitable
storage arrangements, including safe deposit vault, having been made thereat. No business of grant of loans
against the security of gold can be transacted at places where there are no proper facilities for storage/security.

(ii) NBFCs shall not grant any advance against bullion / primary gold and gold coins. NBFCs shall not grant any
advance for purchase of gold in any form including primary gold, gold bullion, gold jewellery, gold coins,
units of Exchange Traded Funds (ETF) and units of gold mutual fund.

(iii) Prior approval of RBI for opening branches in excess of 1,000: It is henceforth mandatory for NBFC to obtain
prior approval of the Reserve Bank to open branches exceeding 1,000. However, NBFCs which already have
more than 1,000 branches may approach the Bank for prior approval for any further branch expansion.
Besides, no new branches will be allowed to be opened without the facilities for storage of gold jewellery and
minimum security facilities for the pledged gold jewellery.

(iv) Standardization of value of gold in arriving at the loan to value ratio: For arriving at the value of gold jewellery
accepted as collateral, it will have to be valued at the average of the closing price of 22 carat gold for the
preceding 30 days as quoted by BBA or the historical spot gold price data publicly disseminated by a
commodity exchange regulated by the Forward Markets Commission.

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(v) Verification of the Ownership of Gold: NBFCs should have an explicit Board approved policy in their overall
loan policy to verify ownership of the gold jewellery, and adequate steps be taken to ensure that the KYC
guidelines stipulated by the Reserve Bank are followed and due diligence of the customer undertaken. Where
the gold jewellery pledged by a borrower at any one time or cumulatively on loan outstanding is more than
20 grams, NBFCs must keep record of the verification of the ownership of the jewellery. The method of
establishing ownership should be laid down as a Board approved policy. Auction Process and Procedures:
The following additional stipulations are made with respect to auctioning of pledged gold jewellery:

(a) The auction should be conducted primarily at the branch level and where the same has failed NBFCs can
pool gold jewellery from different branches in a district and auction it at any location within the district,
after ensuring that all other requirements of the extant directions regarding auction (prior notice, reserve
price, arms-length relationship, disclosures, etc.) are met.

(b) While auctioning the gold the NBFC should declare a reserve price for the pledged ornaments. The
reserve price for the pledged ornaments should not be less than 85% of the previous 30 day average
closing price of 22 carat gold as declared by The Bombay Bullion Association Limited and value of the
jewellery of lower purity in terms of carats should be proportionately reduced.

(c) It will be mandatory on the part of the NBFCs to provide full details of the value fetched in the auction
and the outstanding dues adjusted and any amount over and above the loan outstanding should be payable
to the borrower.

(d) NBFCs must disclose in their annual reports the details of the auctions conducted during the financial
year including the number of loan accounts, outstanding amounts, value fetched and whether any of its
sister concerns participated in the auction.

(vi) Other Instructions:

(a) NBFCs financing against the collateral of gold must insist on a copy of the PAN Card of the borrower
for all transaction above `500,000.

(b) Every NBFC shall ensure compliance with the requirements under sections 269SS and 269T of the
Income Tax Act, 1961, as amended from time to time.

(c) Documentation across all branches must be standardized.

(d) NBFCs shall not issue misleading advertisements like claiming the availability of loans in a matter of 2-
3 minutes.

Accounting Standards & Accounting policies

Subject to the changes in Indian Accounting Standards (“IAS”) and regulatory environment applicable to a NBFC
we may change our accounting policies in the future and it might not always be possible to determine the effect
on the statement of profit and loss of these changes in each of the accounting years preceding the change. In such
cases profit/loss for the preceding years might not be strictly comparable with the profit/loss for the period for
which such accounting policy changes are being made. The Ministry of Corporate Affairs has amended the
existing IAS vide Companies (Indian Accounting Standards) (Amendment) Rules, 2017 on March 17, 2017 and
the same shall be applicable to the Company from April 1, 2018.

Implementation of Indian Accounting Standards: RBI Notification

The Reserve bank of India vide notification number RBI/2019-20/170 DOR

(NBFC).[Link].109/22.10.106/2019-20 dated March 13, 2020 framed regulatory guidance on Ind AS which
will be applicable on Ind AS implementing NBFCs and Asset Reconstruction Companies (ARCs) for preparation
of their financial statements from financial year 2019-20 onwards. These guidelines focus on the need to ensure
consistency in the application of the accounting standards in specific areas, including asset classification and
provisioning, and provide clarifications on regulatory capital in the light of Ind AS implementation.

The guidelines cover aspects on Governance Framework, Prudential Floor for ECL and Computation of
Regulatory Capital and Regulatory Ratios.

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Reporting by Statutory Auditor

The statutory auditor of the NBFC-ND is required to submit to the Board of Directors of the company along with
the statutory audit report, a special report certifying that the Directors have passed the requisite resolution
mentioned above, not accepted any public deposits during the year and has complied with the prudential norms
relating to income recognition, accounting standards, asset classification and provisioning for bad and doubtful
debts as applicable to it. In the event of non-compliance, the statutory auditors are required to directly report the
same to the RBI.

Master Direction - Monitoring of Frauds in NBFCs (Reserve Bank) Directions, 2016 dated September 29,
2016

All NBFCs and NBFCs-ND-SI shall put in place a reporting system for frauds and fix staff accountability in
respect of delays in reporting of fraud cases to the RBI. An NBFC-ND-SI is required to report all cases of fraud
of `1 lakh and above, and if the fraud is of `100 lakhs or above, the report should be sent in the prescribed format
within three weeks from the date of detection thereof. The NBFC-ND-SI shall also report cases of fraud by
unscrupulous borrowers and cases of attempted fraud.

Master Circular dated July 1, 2015 – Frauds – Future approach towards monitoring of frauds in NBFCs

In order to prevent the incidence of frauds in NBFCs, the RBI established a reporting requirement to be followed
by NBFCs, both NBFC-D and NBFCs-ND-SI. In terms of the circular, all NBFCs-ND-SI shall disclose the amount
related to fraud, reported in the company for the year in their balance sheets. NBFCs failing to report fraud cases
to the RBI would be liable for penal action prescribed under the provisions of Chapter V of the RBI Act.
Additionally, the circular provides for categorisation of frauds and the reporting formats in order to ensure
uniformity in reporting.

Master Circular dated July 1, 2015 on returns to be submitted by NBFCs

The circular lists down detailed instructions in relation to submission of returns, including their periodicity,
reporting time, due date, purpose and the requirement of filing such returns by various categories of NBFCs,
including an NBFC-ND-SI. RBI vide notification dated November 26, 2015 titled “Online Returns to be submitted
by NBFCs-Revised” changed the periodicity of NBFC-ND-SI returns from monthly to quarterly.

Master Direction – Non-Banking Financial Companies Auditor’s Report (Reserve Bank) Directions, 2016

Auditor’s Report Master Directions are applicable to auditors of all NBFCs. In addition to the reports to be
furnished under Companies Act, the auditors of NBFCs are mandated to provide a report as prescribed under
Auditor’s Report Master Directions. While matters pertaining to all NBFCs are covered under section 3(A) of
Auditor’s Report Master Directions, matters specifically pertaining to NBFCs-ND are mentioned in section 3(C).
The report furnished by the auditors under Auditor’s Report Master Directions shall include, amongst other things,
if the NBFC has obtained the certificate of registration from the RBI to operate as an NBFC, clarification with
respect to correctness of the capital adequacy ratio mentioned in the return submitted to RBI, status of furnishing
of annual statement of capital funds, risk assets/exposures and risk asset ratio by NBFCs to the RBI and passing
of resolution by the board of the NBFCs for non- acceptance of deposits from public. Every NBFC shall submit a
certificate that is engaged in the business of being an NBFC and it holds a valid certificate of registration issued
by the RBI

Master Direction- Non-Banking Financial Company Returns (Reserve Bank) Directions, 2016

All NBFCs are required to put in place a reporting system for filing various returns with the RBI. An NBFC-ND-
SI is required to file on a quarterly basis a return on important financial parameters, including components of
assets and liabilities, profit and loss account, exposure to sensitive sectors etc.

Ombudsman scheme for customers of NBFCs

The RBI had under its Statement on Development and Regulatory Policies-February 2018 dated February 7, 2018
announced the proposed ombudsman scheme for NBFCs to provide cost-free and expeditious grievance redressal
to customers of all NBFC-Ds and all NBFCs with customer interface having an asset size exceeding `1 billion
(“Covered NBFCs”).

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The RBI has on February 23, 2018 introduced the Ombudsman Scheme for Non-Banking Financial Companies,
2018 (the “Scheme”). The stated objective of the Scheme is to enable the resolution of complaints free of cost,
relating to certain aspects of services rendered by certain categories of NBFCs registered with the RBI to facilitate
the satisfaction or settlement of such complaints, and matters connected therewith. The Scheme provides for the
appointment by RBI of one or more officers not below the rank of general manager as ombudsmen (the
“Ombudsmen”) for a period not exceeding three years at a time, to carry out the functions entrusted to
Ombudsmen under the Scheme. The Scheme describes the nature of complaints which any person could file with
an Ombudsman alleging deficiency in services by an Covered NBFC, which include inter alia failure to convey
in writing the amount of loan sanctioned along with the terms and conditions including annualised rate of interest
and method of application thereof, failure or refusal to provide adequate notice on proposed changes being made
in the sanctioned terms in vernacular or a language understood by the borrower, levying of charges without
adequate prior notice to the borrower/customer and failure or inordinate delay in releasing the securities
documents to the borrower on repayment of all dues. The complaints may be settled by the Covered NBFC within
a specified period or may be decided by an award passed by Ombudsman after affording the parties a reasonable
opportunity to present their case, either in writing or in a meeting. Where the Ombudsman decides to allow the
complaint, the award passed is required to contain the direction/s, if any, to the Covered NBFC for specific
performance of its obligations and in addition to or otherwise, the amount, if any, to be paid by the Covered NBFC
to the complainant by way of compensation for any loss suffered by the complainant, arising directly out of the
act or omission of the Covered NBFC. The Covered NBFC is required to implement the settlement arrived at with
the complainant or the award passed by the Ombudsman when it becomes final and send a report in this regard to
the RBI within 15 days of the award becoming final. The Ombudsman is required to send a report to the RBI
governor annually (as on June 30 every year) containing general review of the activities of his office during the
preceding financial year and provide such other information as may be required by the RBI.

Reserve Bank of India (Know Your Customer (KYC)) Master Directions, 2016 dated February 25, 2016, as
amended (“RBI KYC Directions”)

The RBI KYC Directions are applicable to every entity regulated by the RBI, specifically, scheduled commercial
banks, regional rural banks, local area banks, primary (urban) co-operative banks, state and central co-operative
banks, all India financial institutions, NBFCs, miscellaneous non-banking companies and residuary non-banking
companies, amongst others. In terms of the RBI KYC Directions, every entity regulated thereunder is required to
formulate a KYC policy which is duly approved by the board of directors of such entity or a duly constituted
committee thereof. The KYC policy formulated in terms of the RBI KYC Directions is required to include four
key elements, being customer acceptance policy, risk management, customer identification procedures and
monitoring of transactions. It is advised that all NBFC’S adopt the same with suitable modifications depending
upon the activity undertaken by them and ensure that a proper policy framework of anti-money laundering
measures is put in place. The RBI KYC Directions provide for a simplified procedure for opening accounts by
NBFCs. It also provides for an enhanced and simplified due diligence procedure. It has prescribed detailed
instructions in relation to, inter alia, the due diligence of customers, record management, and reporting
requirements to Financial Intelligence Unit – India. The RBI KYC Directions have also issued instructions on
sharing of information while ensuring secrecy and confidentiality of information held by Banks and NBFCs. The
regulated entities must also adhere to the reporting requirements under Foreign Account Tax Compliance Act and
Common Reporting Standards. The RBI KYC Directions also require the regulated entities to ensure compliance
with the requirements/obligations under international agreements. The regulated entities must also pay adequate
attention to any money-laundering and financing of terrorism threats that may arise from new or developing
technologies and ensure that appropriate KYC procedures issued from time to time are duly applied before
introducing new products/services/technologies. The RBI KYC Directions were updated on April 20, 2018 to
enhance the disclosure requirements under the Prevention of Money-Laundering Act, 2002 and in accordance
with the Prevention of Money-Laundering Rules vide Gazette Notification GSR 538 (E) dated June 1, 2017 and
the final judgment of the Supreme Court in the case of Justice K.S. Puttaswamy (Retd.) & Another v. Union of
India (Writ Petition (Civil) 494/2012). The Directions were updated to accommodate authentication as per the
AADHAR (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016 and use of an
Indian resident’s Aadhar number as a document for the purposes of fulfilling KYC requirement. The RBI KYC
Directions were further amended on January 9, 2020, in view of Government of India Gazette Notification No.
G.S.R. 582(E) dated August 19, 2019 and Gazette Notification G.S.R. 840(E) dated November 13, 2019, notifying
amendment to the Prevention of Money-laundering (Maintenance of Records) Rules, 2005. With a view to
leveraging the digital channels for Customer Identification Process (CIP) by Regulated Entities (REs), the Reserve
Bank has decided to permit Video based Customer Identification Process (V-CIP) as a consent based alternate
method of establishing the customer’s identity, for customer onboarding.

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Asset Liability Management

The RBI has prescribed the Guidelines for Asset Liability Management (“ALM”) System in relation to NBFCs
(“ALM Guidelines”) that are applicable to all NBFCs through a Master Circular on Miscellaneous Instructions
to All Non-Banking Financial Companies dated July 1, 2015. As per this Master Circular, the NBFCs (engaged
in and classified as equipment leasing, hire purchase finance, loan, investment and residuary non-banking
companies) meeting certain criteria, including, an asset base of `10,000 lakhs, irrespective of whether they are
accepting/holding public deposits or not, or holding public deposits of `2,000 lakhs or more (irrespective of the
asset size) as per their audited balance sheet as of March 31, 2001, are required to put in place an ALM system.
The ALM Guidelines mainly address liquidity and interest rate risks. In case of structural liquidity, the negative
gap (i.e. where outflows exceed inflows) in the 1 to 30/31 days’ time-bucket should not exceed the prudential
limit of 15% of cash outflows of each time-bucket and the cumulative gap of up to one year should not exceed
15% of the cumulative cash outflows of up to one year. In case these limits are exceeded, the measures proposed
for bringing the gaps within the limit should be shown by a footnote in the relevant statement.

The Recovery of Debts due to Banks and Financial Institutions Act, 1993

The Recovery of Debts due to Banks and Financial Institutions Act, 1993 (the “DRT Act”) provides for
establishment of the Debts Recovery Tribunals (the “DRTs”) for expeditious adjudication and recovery of debts
due to banks and public financial institutions or to a consortium of banks and public financial institutions. Under
the DRT Act, the procedures for recovery of debt have been simplified and time frames have been fixed for speedy
disposal of cases. The DRT Act lays down the rules for establishment of DRTs, procedure for making application
to the DRTs, powers of the DRTs and modes of recovery of debts determined by DRTs. These include attachment
and sale of movable and immovable property of the defendant, arrest of the defendant and his detention in prison
and appointment of receiver for management of the movable or immovable properties of the defendant.

The DRT Act also provides that a bank or public financial institution having a claim to recover its debt, may join
an ongoing proceeding filed by some other bank or public financial institution, against its debtor, at any stage of
the proceedings before the final order is passed, by making an application to the DRT.

Anti-Money Laundering

The RBI has issued a Master Circular dated July 1, 2015 to ensure that a proper policy framework for the
Prevention of Money Laundering Act, 2002 (“PMLA”) is put into place. The PMLA seeks to prevent money
laundering and provides for confiscation of property derived from or involved in money laundering and for other
matters connected therewith or incidental thereto. It extends to all banking companies, financial institutions,
including NBFCs and intermediaries. Pursuant to the provisions of PMLA and the RBI guidelines, all NBFCs are
advised to appoint a principal officer for internal reporting of suspicious transactions and cash transactions and to
maintain a system of proper record (i) for all cash transactions of value of more than `10 lakhs; (ii) all series of
cash transactions integrally connected to each other which have been valued below `10 lakhs where such series
of transactions have taken place within one month and the aggregate value of such transaction exceeds `10 lakhs.
Further, all NBFCs are required to take appropriate steps to evolve a system for proper maintenance and
preservation of account information in a manner that allows data to be retrieved easily and quickly whenever
required or when requested by the competent authorities. Further, NBFCs are also required to maintain for at least
ten years from the date of transaction between the NBFCs and the client, all necessary records of transactions,
both domestic or international, which will permit reconstruction of individual transactions (including the amounts
and types of currency involved if any) so as to provide, if necessary, evidence for prosecution of persons involved
in criminal activity.

Additionally, NBFCs should ensure that records pertaining to the identification of their customers and their
address are obtained while opening the account and during the course of business relationship, and that the same
are properly preserved for at least ten years after the business relationship is ended. The identification records and
transaction data are to be made available to the competent authorities upon request.

RBI Notification dated December 3, 2015 titled “Anti-Money Laundering (AML)/ Combating of Financing of
Terrorism (CFT) – Standards” states that all regulated entities (including NBFCs) are to comply with the updated
FATF Public Statement and document ‘Improving Global AML/CFT Compliance: on-going process’ as on
October 23, 2015.

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Master Direction on Information Technology Framework for the NBFC Sector, 2017

All systematically important NBFCs must implement the security enhancement requirements under the Master
Direction with respect to enhancing security of its Information Technology/Information Security Framework
(“IT”) business continuity planning, disaster recovery and management. NBFCs must constitute an IT Strategy
Committee and IT Steering Committee and formulate an IT and Information Security Policy in furtherance of the
same. Further, a Cyber Crisis Management Plan must be formulated to address cyber intrusions and attacks.

Appointment of Chief Risk Officer

RBI vide circular bearing reference number RBI/2018-19/184 DNBR (PD) CC. No.099/03.10.001/2018-19 dated
May 16, 2019 directed that NBFCs with asset size of more than `50 billion shall appoint a Chief Risk Officer
(“CRO”) with clearly specified role and responsibilities. The CRO is required to function independently so as to
ensure highest standards of risk management. To ensure independence, the CRO will have a fixed tenure with the
approval of the Board. The CRO shall report directly to the managing director/CEO/risk management committee
of the Board. The CRO shall be involved in the process of identification, measurement and mitigation of risks.
All credit products (retail or wholesale) shall be vetted by the CRO from the angle of inherent and control risks.
The CRO’s role in deciding credit proposals shall be limited to be an advisor.
Directions on Managing Risks and Code of Conduct in Outsourcing of Financial Services by NBFCs
With a view to put in place necessary safeguards applicable to outsourcing of activities by NBFCs, the RBI has
issued directions on managing risks and code of conduct in outsourcing of financial services by NBFCs (“Risk
Management Directions”). The Risk Management Directions specify that core management functions like internal
auditing, compliance functions, decision making functions such as compliance with KYC norms shall not be
outsourced by NBFCs. Further, the Risk Management Directions specify that outsourcing of functions shall not
limit its obligations to its customers.

Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002
(“SARFAESI”)

The SARFAESI Act provides for the enforcement of security interest without the intervention of the courts. Under
the provisions of the SARFAESI Act, a secured creditor can recover dues from its borrowers by taking any of the
measures as provided therein. Rights, with respect to the enforcement of security interest, under the SARFAESI
Act cannot be enforced unless the account of the borrower has been classified as an NPA in the books of account
of the secured creditor in accordance with the directions or guidelines issued by the RBI or any other applicable
regulatory authority. The secured creditors must serve a 60-day notice on the borrower demanding repayment of
the amount due and specifying the borrower’s assets over which the secured creditor proposes to exercise
remedies. If the borrower still fails to pay, the secured creditors, on expiry of the 60-day notice period, can: (i)
take possession of the secured assets; (ii) take over the management of the secured assets along with the right to
transfer by way of lease, assignment or sale of the secured assets; (iii) appoint any person to manage the secured
assets; and (iv) require any person who has acquired any of the secured assets from the borrower to pay amounts
necessary to satisfy the debt. The security interests covered by the SARFAESI Act are security interests over
immovable and movable property, existing or future receivables, certain intangible assets (such as know-how,
patents, copyrights, trademarks, licenses, franchises) and any debt or any right to receive payment of money, or
any receivable, present or future, and in which security interest has been created. Security interests over ships and
aircraft, any statutory lien, a pledge of movables, any conditional sale, hire purchase or lease or any other contract
in which no security interest is created, rights of unpaid sellers, any property not liable to attachment, security
interest for securing repayment of less than `100 lakhs, agricultural land and any case where the amount due is
less than 20.00% of the principal amount and interest are not enforceable under the SARFAESI Act. In the event
that the secured creditor is unable to recover the entire sum due by exercise of the remedies under the SARFAESI
Act in relation to the assets secured, such secured creditor may approach the relevant court for the recovery of the
balance amounts. A secured creditor may also simultaneously pursue its remedies under the SARFAESI Act.

Insolvency and Bankruptcy Code

The Insolvency and Bankruptcy Code, 2016 (“Code”) consolidates laws relating to insolvency, reorganisation
and liquidation/ bankruptcy of all persons, including companies, individuals, partnership firms and Limited
Liability Partnerships (“LLPs”). The Code has established an Insolvency and Bankruptcy Board of India to
function as the regulator for all matters pertaining to insolvency and bankruptcy. The Code prescribes a timeline

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of 330 days for the insolvency resolution process, which begins from the date the application is admitted by the
NCLT. During this period, the creditors and the debtor shall negotiate and finalise a resolution plan (accepted by
66% of the financial creditors) and in the event, they fail, the debtor is placed in liquidation and the moratorium
lifted. The Code stipulates an interim-moratorium period which would commence after filing of the application
for a fresh start process and shall cease to exist after elapse of a period of 180 days from the date of application.
During such period, all legal proceedings against such debtor should be stayed and no fresh suits, proceedings,
recovery or enforcement action may be initiated against such debtor. However, the Code has also imposed certain
restrictions on the debtor during the moratorium period such as the debtor shall not be permitted to act as a director
of any company or be involved in the promotion or management of a company during the moratorium period. In
light of the COVID-19 pandemic, the Government of India, introduced economic reforms to contribute to the ease
of doing business. One of the reforms introduced is the suspension of the Code for a period of one year. An
ordinance detailing the changes pursuant to this reform is expected to be introduced by the government. Further,
the GoI vide notification dated March 24, 2020 (“Notification”) has amended section 4 of the Code due the
lingering impact of the COVID-19 pandemic. Pursuant to the said Notification, Government of India has increased
the minimum amount of default under the insolvency matters from `1,00,000 to `1,00,00,000.

The Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and
Application to Adjudicating Authority) Rules 2019 (“IBC Rules, 2019”)

The Code, which regulates the insolvency resolution process for “corporate persons” previously excluded
financial service providers from its purview. With the notification of the IBC Rules, 2019, the provisions of the
Code will apply to financial service providers as well, which are subject to modifications and additional conditions
as set out in the IBC Rules, 2019. Financial service providers are defined to mean persons engaged in the business
of providing financial services in terms of authorisation issued or registration granted by a financial sector
regulator under the Code. “Financial services” is broadly defined in the Code, and includes, inter alia, services in
the nature of acceptance of deposits, administration of assets, underwriting services, advisory services with respect
to dealings in financial products, operation of an investment scheme, and maintenance of records of ownership of
a financial product. The IBC Rules, 2019, lays down the provisions for setting up an advisory committee,
resolution plan and the liquidation process of Financial service providers.

Laws relating to employment

Shops and establishments legislations in various states

The provisions of various shops and establishments legislations, as applicable, regulate the conditions of work
and employment in shops and commercial establishments and generally prescribe obligations in respect of inter-
alia registration, opening and closing hours, daily and weekly working hours, holidays, leave, health and safety
measures and wages for overtime work.

Labour Laws

Our Company is required to comply with various labour laws, including the Code of Wages, 2019, the Payment
of Gratuity Act, 1972 and the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.

Laws relating to intellectual property

The Trade Marks Act, 1999 and the Indian Copyright Act, 1957 inter-alia govern the law in relation to intellectual
property, including brand names, trade names and service marks and research works.

Miscellaneous

Foreign Exchange Management (Debt Instrument) Regulations, 2019 (“Debt Regulations”)

The Debt Regulations prohibits investments by non-residents in debt instruments in contravention of the rules laid
down by the RBI. Similarly, restriction have also been placed on individuals, entities, mutual funds, venture
capitals, firms, or association of persons from receiving investments in violation to the Debt Regulations. The
Debt Regulations differs on the basis of whether the transaction is being made by FPI, or NRI/OCI citizen on a
repatriation or a non- repatriation basis. If the transaction is being made by NRI/OCI on a non-repatriation basis
then it becomes essential to understand if it is occurring on the account of demerger, merger, or an amalgamation
taking place. All transactions of this nature are mandatorily required to be channelled through a bank. The sale

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proceeds to are required to be remitted as per the Debt Regulations. All requisite conditions, as laid down by
SEBI, needs to be complied with.

Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019 (“FPI Regulations”)

The FPI Regulations makes it mandatory for the FPI to obtain the necessary certificate from the designated
depository participant on behalf of SEBI. The eligibility criteria for FPI, includes the applicant to not be an NRI,
or OCI. The applicant’s country’s central bank should be a member of the Bank for international settlements. The
FPI Regulations also differentiates FPIs into Category I (Governments, Pension Funds, University Funds) and
Category II (corporate bodies, individuals). The FPI Regulations, specifically lays down the kind of investments
FPI are allowed to transact in, namely shares, debentures, mutual funds, REIT and states the responsibilities of
the depository participants.

Foreign Direct Investment (“FDI”)

FDI in an Indian company is governed by the provisions of the FEMA read with FEMA Regulations and the FDI
Policy. FDI is permitted (except in the prohibited sectors) in Indian companies either through the automatic route
or the approval route, depending upon the sector in which FDI is sought to be made. Under the automatic route,
no prior Government approval is required for the issue of securities by Indian companies/acquisition of securities
of Indian companies, subject to the sectoral caps and other prescribed conditions. Investors are required to file the
required documentation with the RBI within 30 days of such issue/acquisition of securities. Under the approval
route, prior approval from the relevant ministry/ministries of the Government or RBI is required. FDI for the
items/activities that cannot be brought in under the automatic route (other than in prohibited sectors) may be
brought in through the approval route. Further, as per the sector specific guidelines of the Government, 100%
FDI/NRI investments are allowed under the automatic route in certain NBFC activities subject to compliance with
guidelines of the RBI in this regard.

In addition to the above, our Company is required to comply with the provisions of the Companies Act, 2013, and
the rules made thereunder, as amended, the Foreign Exchange Management Act, 1999, various tax related
legislations and other applicable statutes.

Regulatory measures on account of the COVID-19 pandemic

The RBI has issued circulars, the Statement of Developmental and Regulatory Policies dated May 22, 2020 and
Monetary Policy Statement, 2020-2021: Resolution of Monetary Policy Committee dated May 22, 2020
announcing certain additional regulatory measures with an aim to revive growth and mitigate the impact of
COVID-19 on business and financial institutions in India, including:

(a) permitting banks to grant a moratorium of six months on all term loan instalments and working capital
facilities sanctioned in the form of cash credit/overdraft (“CC/OD”), falling due between March 1, 2020 and
August 31, 2020, subject to the fulfilment of certain conditions;

(b) permitting the recalculation of ‘drawing power’ of working capital facilities sanctioned in the form of cash/
credit overdraft facilities by reducing the margins till the extended period, being August 31, 2020, and
permitting lending institutions to restore the margins to the original levels by March 31, 2021;

(c) permitting the increase in the bank’s exposures to a group of connected counterparties from 25% to 30% of
the eligible capital base of the bank, up to June 30, 2021;

(d) deferring the recovery of the interest applied in respect of all working capital facilities sanctioned in the form
of cash/credit overdraft facilities during the period from March 1, 2020 to August 31, 2020;

(e) permitting lending institutions to convert the accumulated interest on working capital facilities up to the
deferment period (up to August 31, 2020) into a funded interest term loan which shall be repayable not later
than the end of the current financial year (being, March 31, 2021);

(f) permitting the lending institutions to exclude the moratorium period wherever granted in respect of term
loans as stated in (a) above, from the number of days past-due for the purpose of asset classification under
the income recognition and asset classification norms, in respect of accounts classified as standard as on
February 29, 2020, even if overdue;

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(g) permitting the lending institutions to exclude deferment period on recovery of the interest applied, wherever
granted as stated in (d) above, for the determination of out of order status, in respect of working capital
facilities sanctioned in the form of CC/OD where the account is classified as standard, including special
mention accounts, as on February 29, 2020; and

(h) requiring lending institutions to make general provisions of not less than 10% of the total outstanding of
accounts in default but standard as on February 29, 2020 and asset classification benefit is availed, to be
phased over two quarters as provided: (i) not less than 5% for the quarter ended March 31, 2020; and (ii) not
less than 5% for the quarter ended June 30, 2020, subject to certain adjustments.

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SECTION VIII - SUMMARY OF MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION

Capitalised terms used in this section have the meaning that has been given to such terms in the Articles of
Association of our Company. In case of any inconsistency between the Articles of Association of our Company
and the Companies Act, 1956 and Companies Act, 2013, the provisions of the Companies Act, 1956 and the
Companies Act, 2013, as applicable, shall prevail over the Articles of Association of our Company. The main
provisions of the Articles of Association of our Company are detailed below:

PRELIMINARY

In the interpretation of these Articles, the following expressions shall have the following meanings, unless
repugnant to the subject or context.

“The Act” or “The said Act” means the Companies Act, 1956 (Act 1 of 1956) and subsequent amendments thereto
or any statutory modifications or re-enactment thereof for the time being in force

(1) “The Company” of “this Company” means Muthoottu Mini Financers Limited

(2) “The Seal” means the Common Seal of the Company.

Table “A” not to apply

1. (a) The regulations contained in Table marked “A” in Schedule I of the Companies Act, 1956,
(hereinafter called the Act or the said Act) shall apply to the Company, except in so far as
excluded, modified, varied or altered expressly or impliedly by the regulations of the Company
hereinafter following or made from time to time.

SHARE CAPITAL AND VARIATION OF RIGHTS

5. (a) The Authorised Share Capital of the Company shall be as per paragraph V of the Memorandum
of Association of the Company with rights to alter the same in whatever way as deemed fit by
the Company. The Company may increase the Authorised Capital which may consist of Equity
and/or Preference Shares as the Company in General Meeting may determine in accordance
with the law for the time being in force relating to Companies with power to increase or reduce
such capital from time to time in accordance with the Regulations of the Company and the
legislative provisions for the time being in force in this behalf and with power to divide the
shares in the Capital for the time being into Equity Share Capital or Preference Share Capital
and to attach thereto respectively any preferential, qualified or special rights, privileges or
conditions and to vary, modify and abrogate the same in such manner as may be determined by
or in accordance with these presents.

(b) Subject to the rights of the holders of any other shares entitled by the terms of issue to
preferential repayment over the equity shares in the event of winding up of the Company, the
holders of the equity shares shall be entitled to be repaid the amounts of capital paid up or
credited as paid up on such equity shares and all surplus assets thereafter shall belong to the
holders of the equity shares in proportion to the amount paid up or credited as paid up on such
equity shares respectively at the commencement of the winding up.

INCREASE REDUCTION AND ALTERATION OF CAPITAL

6. The Company may from time to time in General Meeting increase its Share Capital by the issue of new
shares of such amounts as it thinks expedient.

On what conditions the new shares may be issued

(a) Subject to the provisions of sections 80, 81 and 85 to 90 of the Act, the new shares shall be
issued upon such terms and conditions and with such rights and privileges annexed thereto by
the General Meeting creating the same as shall be directed and if no direction be given as the
Directors shall determine and in particular such shares may be issued subject to the provisions
of the said sections with a preferential or qualified right to dividends and in distribution of assets

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of the Company and subject to the provisions of the said sections with special or without any
right of voting and subject to the provisions of Section 80 of the Act any preference shares may
be issued on the terms that they are or at the option of the Company are liable to be redeemed.

Further issue of Shares

(b) Where at any time after the expiry of two years from the formation of a Company or at any time
after the expiry of one year from the allotment of shares in that Company made for the first time
after its formation, whichever is earlier, it is proposed to increase the subscribed capital of the
Company by allotment of further shares either out of the unissued capital or out of the increased
share capital, then

(i) such further shares shall be offered to the persons who at the date of offer, are holders
of the equity shares of the Company, in proportion, as nearly as circumstances admit,
to the Capital paid up on those shares at that date.

(ii) the offer aforesaid shall be made by a notice specifying the number of shares offered
and limiting a time not being less than thirty days from the date of the offer within
which the offer, if not accepted, will be deemed to have been declined.

(iii) unless the articles of the company otherwise provide, the offer aforesaid shall be
deemed to include a right exercisable by the person concerned to renounce the shares
offered to him or any of them in favour of any other person; and the notice referred to
in clause (b) shall contain a statement of this right. PROVIDED THAT the directors
may decline, without assigning any reason to allot any shares to any person in whose
favour any member may renounce the shares offered to him.

(iv) after the expiry of the time specified in the notice aforesaid or on receipt of earlier
intimation from the person to whom such notice is given that he declines to accept the
shares offered, the Board of directors may dispose of them in such manner as they
think most beneficial to the Company.

(c) Notwithstanding anything contained in the preceding sub-clause (1), the further shares aforesaid
may be offered to any persons whether or not those persons include the persons referred to in
clause (a) of sub-section (1) in any manner whatsoever:-

(i) if a special resolution to that effect is passed by the company in general meeting, or

(ii) where no such special resolution is passed if the votes cast (whether on a show of hands
or on a poll, as the case may be) in favour of the proposal contained in the resolution
moved in that General Meeting (including the casting vote, if any, of the Chairman) by
members who, being entitled so to do, vote in person, or where proxies are allowed,
by proxy, exceed the votes, if any, cast against the proposal by members so entitled
and voting and the Central Government is satisfied, on an application made by the
Board of Directors in this behalf, that the proposal is most beneficial to the Company.

(d) Nothing in clause (c) of sub-section (1) shall be deemed –

(i) to extend the time within which the offer should be accepted, or

(ii) to authorise any person to exercise the right of renunciation for a second time, on the
ground that the person in whose favour the renunciation was first made has declined
to take the shares comprised in the renunciation.

(e) Nothing in this article shall apply –

to the increase of the subscribed capital of the company caused by the exercise of an option
attached to debentures issued or loans raised by the company –

(i) to convert such debentures or loans into shares in the company, or

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(ii) to subscribe for shares in the company; (Whether such option is conferred in these
Articles or otherwise.)

Provided that the terms of issue of such debentures or the terms of such loans include a term providing for such
option and such term:

(a) either has been approved by the Central Government before the issue of debentures or the raising of the
loans, or is in conformity with the rules 197, if any, made by that Government in this behalf; and

(b) in the case of debentures or loans other than debentures issued to, or loans obtained from, the Government
or any institution specified by the Central Government in this behalf, has also been approved by a special
resolution passed by the company in general meeting before the issue of the debentures or the raising of
the loans.

Shares at the disposal of the Directors

(a) Subject to the provisions of Section 81 of the Act and these Articles, the shares in the capital of the
company for the time being shall be under the control of the Directors who may issue, allot or otherwise
dispose of the same or any of them to such persons, in such proportion and on such terms and conditions
and either at a premium or at par or (subject to the compliance with the provision of Section 79 of the
Act) at a discount and at such time as they may from time to time think fit and with the sanction of the
company in the General Meeting to give to any person or persons the option or right to call for any shares
either at par or premium during such time and for such consideration as the Directors think fit and may
issue and allot shares in the capital of the company on payment in full or part of any property sold and
transferred or for any services rendered which may so be allotted may be issued as fully paid up shares
and if so issued, shall be deemed to be fully paid shares. Provided that option or right to call of shares
shall not be given to any person or persons without the sanction of the company in the General Meeting.

Same as Original Capital

(a) Except so far as otherwise provided by the conditions of issue or by these presents, any Capital raised by
the creation of new shares shall be considered as part of the original Capital and shall be subject to the
provisions herein contained with reference to the payment of calls, instalments, transfers, transmission,
forfeiture, lien, surrender, voting and otherwise.

SHARES AND CERTIFICATES

Issue of further Shares not to affect right of existing share holders

13. The rights or privileges conferred upon the holders of the shares of any class issued with preference or
other rights, shall not unless otherwise be deemed to be varied or modified or affected by the creation or
issue of further shares ranking pari passu therewith.

Provisions of Sections 85 to 88 of the Act to apply

14. The provisions of Sections 85 to 88 of the Act in so far as the same may be applicable shall be observed
by the Company.

Register of Members and Debenture holders

15. (a) The Company shall cause to be kept a Register of Members and an Index of Members in
accordance with Sections 150 and 151 of the Act and Register and Index of Debenture holders
in accordance with Section 152 of the Act. The Company may also keep a foreign Register of
Members and Debenture holders in accordance with Section 157 of the Act.

(b) The Company shall also comply with the provisions of Sections 159 and 161 of the Act as to
filling of Annual Returns.

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(c) The Company shall duly comply with the provisions of Section 163 of the Act in regard to
keeping of the Registers, Indexes, Copies of Annual Returns and giving inspection thereof and
furnishing copies thereof.

Restriction on allotment

17. The Board shall observe the restriction as to allotment of shares to the public contained in Sections 69
and 70 of the Act and shall cause to be made the return as to allotment provided for in Section 75 of the
Act.

Shares to be numbered progressively and no shares to be subdivided

18. The shares in the Capital shall be numbered progressively according to the several denominations and
except in the manner hereinbefore mentioned no share shall be subdivided. Every forfeited or surrendered
share shall continue to bear the number by which the same was originally distinguished.

Shares at the disposal of the Directors

19. Subject to the provisions of Section 81 of the Act and these Articles the shares in the Capital of the
Company for the time being shall be under the control of the Directors who may issue, allot or otherwise
dispose of the same or any of them to such persons, in such proportion and on such terms and conditions
and either at a premium or at par or (subject to compliance with the provisions of Section 79 of the Act)
at a discount and at such time as they may from time to time think fit and with the sanction of the
Company in General Meeting to give to any person the option to call for any shares either at par or at a
premium during such time and for such consideration as the Directors think fit, and may issue and allot
shares in the Capital of the Company on payment in full or part for any property sold and transferred or
for services rendered to the Company in the conduct of its business and any shares which may be so
allotted may be issued as fully paid up shares and if so issued, shall be deemed to be fully paid shares.
Provided that option or right to call of shares shall not be given to any person or persons without the
sanction of the company in General Meeting

‘Buy back of Shares’

22A. Notwithstanding anything contained in any other Article of the Articles of Association, but subject to the
provisions of Section 77 A and 77 B of the Act and Securities & Exchange Board of India (Buy back of
Securities) Regulations 1998 as may be in force at any time and from time to time, the Company may
acquire, purchase, own, resell any of its own fully/partly paid or redeemable Preference Shares or Equity
Shares and any other security as may be specified under the Act, Rules and regulations from time to time
and may make payment thereof out of funds at its disposal or in any manner as may be permissible or in
respect of such acquisition/purchase on such terms and conditions and at such time or times in one or
more instalments as the Board may in its discretion decide and deem fit. Such Shares which are so bought
back by the Company may either be extinguished and destroyed or reissued as may be permitted under
the Act or the Regulations as may be in force at the relevant time subject to such terms and conditions as
may be decided by the Board and subject further to the rules & regulations governing such issue.

CALLS

Directors may make Calls

31. The Directors may from time to time and subject to Section 91 of the Act and subject to the terms on
which any shares/debentures may have been issued and subject to the conditions of allotment, by a
resolution passed at a meeting of the Board (and not by circular resolution) make such calls as they think
fit upon the members/debenture holders in respect of all moneys unpaid on the shares/debentures held
by them respectively and such members/debenture holders shall pay the amount of every call so made
on him to the persons and at the times and place appointed by the Directors. A Call may be made payable
by instalments. A call may be postponed or revoked as the Board may determine. The option or right to
call of shares shall not be given to any of the person except with the sanction of the Issuer in general
meeting.

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Calls to date from resolution

32. A call shall be deemed to have been made at the time when the resolution of the Directors authorising
such Call was passed and may be made payable by members/debenture holders on a subsequent day to
be specified by the Directors.

Notice of Call

33. Thirty days’ notice in writing shall be given by the Company of every calls made payable otherwise than
on allotment specifying the time and place of payment provided that before the time of payment of such
call, the Directors may by notice in writing to the members/debenture holders revoke the same.

Directors may extend time

34. The Directors may, from time to time, at their discretion, extend the time fixed for the payment of any
call, and may extend such time as to all or any of the members/debenture holders who from residence at
a distance or other cause, the Directors may deem fairly entitled to such extension, but no
member/debenture holder shall be entitled to such extension, save as a matter of grace and favour.

Sums deemed to be Calls

35. Any sum, which by the terms of issue of a share/debenture becomes payable on allotment or at any fixed
date whether on account of the nominal value of the share/debenture or by way of premium, shall for the
purposes of these Articles be deemed to be a Call duly made and payable on the date on which by the
terms of issue the same becomes payable, and in case of non-payment, all the relevant provisions of these
Articles as to payment of interest and expenses, forfeiture or otherwise, shall apply as if such sum had
become payable by virtue of a Call duly made and notified.

Instalments on shares to be duly paid

36. If by the condition of allotment of any shares the whole or part of the amount of issue price thereof shall
be payable by instalments, every such instalment shall, when due, be paid to the Company by the person
who, for the time being and from time to time, shall be the registered holder of the share or his legal
representative.

Calls on shares of the same class to be made on uniform basis

37. Where any calls for further Share Capital are made on shares, such calls shall be made on a uniform basis
on all shares falling under the same class.

Explanation: For the purpose of this provision, shares of the same nominal value on which different
amount have been paid up shall not be deemed to fall under the same class.

Liability of joint holders of shares

38. The joint holders of a share shall be severally as well as jointly liable for the payment of all instalments
and calls due in respect of such shares.

When interest on call or instalment payable

39. If the sum payable in respect of any call or instalment be not paid on or before the day appointed for
payment thereof or any such extension thereof, the holder for the time being or allottee of the share in
respect of which a call shall have been made or the instalment shall be due, shall pay interest as shall be
fixed by the Board from the day appointed for the payment thereof or any such extension thereof to time
of actual payment but the Directors may waive payment of such interest wholly or in part.

Payment in anticipation of calls may carry Interest

42. (a) The Directors may, if they think fit, subject to the provisions of Section 92 of the Act, agree to
and receive from any member willing to advance the same whole or any part of the money due

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upon the shares held by him beyond the sum actually called for, and upon the amount so paid
or satisfied in advance, or so much thereof as from time to time exceeds the amount of the calls
then made upon the shares in respect of which such advance has been made, the Company may
pay interest at such rate, as the member paying such sum in advance and the Directors agree
upon provided that money paid in advance of calls shall not confer a right to participate in profits
or dividends. The Directors may at any time repay the amount so advanced.

(b) The member shall not be entitled to any voting rights in respect of the moneys so paid by him
until the same would but for such payment, become presently payable.

43. The provisions of these Articles shall mutatis mutandis apply to the calls on debentures of the Company.

TRANSFER AND TRANSMISSION OF SHARES AND DEBENTURES

Register of Transfers

59. The Company shall keep a book to be called the “Register of Transfers” and therein shall be fairly and
distinctly entered the particulars of every transfer or transmission of any share.

Form of Transfer

60. The instrument of transfer shall be common, in writing and all the provisions of Section 108 of the
Companies Act, 1956 and statutory modification thereof for the time being shall be duly compiled with
in respect of all transfer of shares and registration thereof.

‘Dematerialisation of Securities’

60A. (1) The provisions of this Article shall apply notwithstanding anything to the contrary contained in
any other Article of these Articles.

(2) (i) The Company shall be entitled to dematerialise its securities and to offer securities in
a dematerialised form pursuant to the Depository Act, 1996.

(ii) Option for Investors:

Every holder of or subscriber to securities of the Company shall have the option to
receive security certificates or to hold the securities with a Depository. Such a person
who is the beneficial owner of the Securities can at any time opt out of a Depository,
if permitted, by the law, in respect of any security in the manner provided by the
Depositories Act, 1996 and the Company shall, in the manner and within the time
prescribed, issue to the beneficial owner the required Certificates for the Securities.

If a person opts to hold its Security with a Depository, the Company shall intimate such
depository the details of allotment of the Security.

(iii) Securities in Depository to be in fungible form:

All Securities of the Company held by the Depository shall be dematerialised and be
in fungible form.

Nothing contained in Sections 153, 153A, 153B, 187B, 187C & 372A of the Act shall
apply to a Depository in respect of the Securities of the Company held by it on behalf
of the beneficial owners.

(iv) Rights of Depositories & Beneficial Owners:

(a) Notwithstanding anything to the contrary contained in the Act a Depository shall
be deemed to be the registered owner for the purpose of effecting transfer of
ownership of Security of the Company on behalf of the beneficial owner.

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(b) Save as otherwise provided in (a) above, the depository as the registered owner of
the Securities shall not have any voting rights or any other rights in respect of the
Securities held by it.

(c) Every person holding Securities of the Company and whose name is entered as
the beneficial owner in the records of the depository shall be deemed to be a
member of the Company. The beneficial owner of Securities shall be entitled to
all the rights and benefits and be subject to all the liabilities in respect of his
Securities which are held by a depository.

(v) Service of Documents:

Notwithstanding anything contained in the Act to the contrary, where Securities of the
Company are held in a depository, the records of the beneficial ownership may be
served by such depository to the Company by means of electronic mode or by delivery
of floppies or discs.

(vi) Transfer of Securities:

Nothing contained in Section 108 of the Act, shall apply to a transfer of Securities
effected by a transferor and transferee both of whom are entered as beneficial owners
in the records of a depository.

(vii) Allotment of Securities dealt with in a depository:

Notwithstanding anything contained in the Act, where Securities are dealt with by a
depository, the Company shall intimate the details thereof to the depository
immediately on allotment of such securities.

(viii) Register and Index of Members:

The Company shall cause to be kept at its Registered Office or at such other place as
may be decided, Register and Index of Members in accordance with Section 150 and
151 and other applicable provisions of the Act and the Depositories Act, 1996 with the
details of Shares held in physical and dematerialised forms in any media as may be
permitted by law including in any form of electronic media.

The Register and Index of beneficial owners maintained by a depository under Section
11 of the Depositories Act, 1996, shall be deemed to be the Register and Index of
Members for the purpose of this Act. The Company shall have the power to keep in
any state or country outside India, a Register of Members for the residents in that state
or Country.

Instrument of transfer to be executed by transferor and transferee

61. (a) Every such instrument of transfer shall be signed both by the transferor and transferee and the
transferor shall be deemed to remain the holder of such share until the name of the transferee is
entered in the Register of Members in respect thereof.

Directors , the Directors may, at their own absolute and uncontrolled discretion any by giving reasons, decline to
register or acknowledge any transfer of shares whether fully paid or not and the right of refusal, shall not be
affected by the circumstances that the proposed transferee is already a member of the Company but in such cases,
the Directors shall within one month from the date on which the instrument of transfer was lodged with the
company, send to the transferee and transferor notice of the refusal to register such transfer provided that
registration of transfer shall not be refused on the ground of the transferor being either; alone or jointly with any
other person or persons indebted to the company or any account whatsoever except when the company has a lien
on the shares. Transfer of shares/debentures in whatever lot shall not be refused.

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(b) Nothing in Sections 108, 109 and 110 of the Act shall prejudice this power to refuse to register
the transfer of, or the transmission on legal documents by operation of law of the rights to, any
shares or interest of a member in, any shares or debentures of the Company.

Transfer of Shares

62. (a) An application of registration of the transfer of shares may be made either by the transferor or
the transferee provided that where such application is made by the transferor, no registration
shall in the case of partly paid shares be effected unless the Company gives notice of the
application to the transferee and subject to the provisions of Clause (d) of this Article, the
Company shall unless objection is made by the transferee within two weeks from the date of
receipt of the notice, enter in the Register of Members the name of the transferee in the same
manner and subject to the same conditions as if the application for registration was made by the
transferee.

(b) For the purpose of clause (a) above notice to the transferee shall be deemed to have been duly
given if sent by prepaid registered post to the transferee at the address given in the instrument
of transfer and shall be deemed to have been duly delivered at the time at which it would have
been delivered to him in the ordinary course of post.

(c) It shall not be lawful for the Company to register a transfer of any shares unless a proper
instrument of transfer duly stamped and executed by or on behalf of the transferor and by or on
behalf of the transferee and specifying the name, address and occupation if any, of the transferee
has been delivered to the Company along with the certificate relating to the shares and if no
such certificate is in existence, along with the letter of allotment of shares. The Directors may
also call for such other evidence as may reasonably be required to show the right of the
transferor to make the transfer provided that where it is proved to the satisfaction of the Directors
of the Company that an instrument of transfer signed by the transferor and the transferee has
been lost, the Company may, if the Directors think fit, on an application in writing made by the
transferee and bearing the stamp required by an instrument of transfer register the transfer on
such terms as to indemnity as the Directors may think fit.

(d) Nothing in clause (c) above shall prejudice any power of the Company to register as shareholder
any person to whom the right to any share has been transmitted by operation of law.

(e) The Company shall accept all applications for transfer of shares/debentures; however, this
condition shall not apply to requests received by the Company.

(A) for splitting of a share or debenture certificate into several scripts of very small
denominations;

(B) proposals for transfer of shares/debentures comprised in a share/debenture certificate

to several parties involving, splitting of a share/debenture certificate into small
denominations and that such split/transfer appears to be unreasonable or without any
genuine need.

(i) transfer of equity shares/debentures made in pursuance of any statutory

provisions or an order of a Competent Court of law;

(ii) the transfer of the entire equity shares/debentures by an existing

shareholder/debenture holder of the Company holding under one folio less
than 10 (ten) Equity Shares or 10 (ten) Debentures (all relating to the same
series) less than in market lots by a single transfer to a single or joint
transferee.

(iii) the transfer of not less than 10 (ten) Equity shares or 10 (ten) Debentures (all
relating to the same series) in favour of the same transferee(s) under two or
more transfer deeds, out of which one or more relate(s) to the transfer of less
than 10 (ten) Equity Shares/10 (ten) debentures.

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(iv) the transfer of less than 10 (ten) Equity Shares or 10 (ten) Debentures (all
relating to the same series) to the existing share holder/debenture holder
subject to verification by the Company.

Provided that the Board may in its absolute discretion waive the aforesaid conditions
in a fit and proper case(s) and the decision of the Board shall be final in such case(s).

(f) Nothing in this Article shall prejudice any power of the Company to refuse to register the
transfer of any share. However, the registration of transfer shall not be refused on the ground of
the transferor being either alone or jointly with any other person or persons indebted to the
Issuer on any account whatsoever;

Transfer books and Register of members when closed

65. The Board shall have power on giving not less than seven days’ previous notice by advertisement in
some newspaper circulating in the district in which the office of the Company is situate, to close the
Transfer books, the Register of members or Register of debenture holders at such time or times and for
such period or periods, not exceeding thirty days at a time and not exceeding in the aggregate forty five
days in each year.

Transfer to Minors etc.

66. Only fully paid shares or debentures shall be transferred to a minor acting through his/her legal or natural
guardian. Under no circumstances, shares or debentures be transferred to any insolvent or a person of
unsound mind.

Title to shares of deceased holder

67. The executors or administrators of a deceased member (not being one or two or more joint holders) or
the holder of a deceased member (not being one or two or more joint holders) shall be the only persons
whom the Company will be bound to recognise as having any title to the shares registered in the name
of such member, and the Company shall not be bound to recognise such executors or administrators or
the legal representatives unless they shall have first obtained probate or Letters of Administration or a
Succession Certificate, as the case may be, from a duly constituted competent Court in India, provided
that in any case where the Directors in their absolute discretion think fit, the Directors may dispense with
the production of probate or Letters of Administration or a Succession Certificate upon such terms as to
indemnity or otherwise as the Directors in their absolute discretion may think necessary under Article 70
register the name of any person who claims to be absolutely entitled to the shares standing in the name
of a deceased member, as a member.

Registration of persons entitled to share otherwise than by transfer

68. (a) Subject to the provisions of Articles 67 and 77(d), any person becoming entitled to any share in
consequence of the death, lunacy, bankruptcy or insolvency of any member or by any lawful
means other than by a transfer in accordance with these presents, may with the consent of the
Directors (which they shall not be under any obligation to give) upon producing such evidence
that he sustains the character in respect of which he proposes to act under this Article or of such
titles as the Directors shall think sufficient, either be registered himself as a member in respect
of such shares or elect to have some person nominated by him and approved by the Directors
registered as a member in respect of such shares. Provided nevertheless that if such person shall
elect to have his nominee registered, he shall testify his election by executing in favour of his
nominee an instrument of transfer in accordance with the provisions herein contained and until
he does so, he shall not be free from any liability in respect of such shares.

(b) A transfer of the shares or other interest in the Company of a deceased member thereof made
by his legal representative shall, although the legal representative is not himself a member be as
valid as if he had been a member at the time of the execution of the instrument of transfer.

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‘Nomination’

(c) (1) Every Shareholder or Debenture holder or Deposit holder of the Company, may at any
time, nominate a person to whom his Shares or Debentures or Deposit shall vest in the
event of his death in such manner as may be prescribed under the Act.

(2) Where the Shares or Debentures or Deposits of the Company are held by more than one
person jointly, joint holders may together nominate a person to whom all the rights in the
Shares or Debentures or Deposits as the case may be shall vest in the event of death of all
the joint holders in such manner as may be prescribed under Section 58A(11) and 109A
of the Act.

(3) Notwithstanding anything contained in any other law for the time being in force or in any
disposition, whether testamentary or otherwise, where a nomination made in the manner
aforesaid purports to confer on any person the right to vest the Shares or Debentures or
Deposits, the nominee shall, on the death of the Shareholder or Debenture holder or
Deposit holder, as the case may be on the death of the joint holders become entitled to all
the rights in such Shares or Debentures or Deposits as the case may be, all the joint holders,
in relation to such Shares or Debentures or Deposits, to the exclusion of all other persons,
unless the nomination is varied or cancelled in the manner as may be prescribed under the
Act.

(4) Where the nominee is a minor, it shall be lawful for the holder of the Shares or Debentures
or Deposits, to make the nomination to appoint any person to become entitled to Share in,
or Debentures or Deposits of, the Company, in the manner prescribed under the Act, in
the event of his death, during the minority.

‘Transmission of Shares or Debentures’

(d) (1) A nominee, upon production of such evidence as may be required by the Board and subject
to provisions of Section 109B of the Act and as hereinafter provided, elect, either –

(a) to register himself as holder of the Share or Debenture, as the case may be; or

(b) to make such transfer of the Share or Debenture, as the deceased Shareholder or
Debenture holder, as the case may be, could have made.

(2) if the nominee elects to be registered as holder of the Share or Debenture himself, as the
case may be, he shall deliver or send to the Company, a notice in writing signed by him
stating that he so elects and such notice shall be accompanied with the death certificate
of the deceased Shareholder or Debenture holder, as the case may be.

(3) a nominee shall be entitled to the share dividend and other advantages to which he would
be entitled if he were the registered holder of the Share or Debenture. Provided that he
shall not, before being registered as a member, be entitled to exercise any right conferred
by membership in relation to meeting of the Company.

provided further that Board may, at any time, give notice requiring any such person to
elect either to be registered himself or to transfer the Share or Debenture, and if the notice
is not complied with within ninety days, the Board may thereafter withhold payment of
all dividends, bonus or other monies payable in respect of the Share or Debenture, until
the requirements of the notice have been complied with.

Persons entitled may receive dividend without being registered as member

70. A person entitled to a share by transmission shall, subject to the right of the Directors to retain such
dividends, bonuses or moneys as hereinafter provided be entitled to receive, and may give a discharge
for any dividends, bonuses or other moneys payable in respect of the share/debenture.

71. Article 70 shall not prejudice the provisions of Articles 44 and 55.

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Refusal to register nominee

72. The Directors shall have the same right to refuse on legal ground to register a person entitled by
transmission to any shares or his nominee as if he were the transferee named in an ordinary transfer
presented for registration.

Directors may require evidence of transmission

73. Every transmission of a share shall be verified in such manner as the Directors may require, and the
Company may refuse to register any such transmission until the same be so verified or until or unless an
indemnity be given to the Company with regard to such registration which the Directors at their discretion
shall consider sufficient, provided nevertheless that there shall not be any obligation on the Company or
the Directors to accept any indemnity.

No Fees on transfer or transmission

74. No fees shall be charged for registration of transfer transmission, Probate, Succession Certificate and
Letters of administration, Certificate of Death of Marriage, Power of Attorney or similar other document.

The Company not liable for disregard of a notice prohibiting registration of transfer

75. The Company shall incur no liability or responsibility whatsoever in consequence of its registering or
giving effect to any transfer of shares made or purporting to be made by any apparent legal owner thereof
(as shown or appearing in the Register of members) to the prejudice of persons having or claiming any
equitable right, title or interest to or in the said shares, notwithstanding that the Company may have had
notice of such equitable right, title or interest or notice prohibiting registration of such transfer and may
have entered such notice referred thereto in any book of the Company and the Company shall not be
bound or required to regard or attend or give effect to any notice which may be given to it of any equitable
right, title or interest or be under any liability whatsoever for refusing or neglecting so to do, though it
may have been entered or referred to in some book of the Company, but the Company shall nevertheless
be at liberty to regard and attend to any such notice and give affect thereto if the Directors shall so think
fit.

76. The provisions of these Articles shall mutatis mutandis apply to the transfer or transmission by operation
of law, of debentures of the Company.

JOINT HOLDERS

Joint-holders

77. Where two or more persons are registered as the holders of any shares/debentures, they shall be deemed
(so far as the Company is concerned) to hold the same as joint tenants with benefits of survivorship,
subject to the following and other provisions contained in these Articles.

No transfer to more than four persons as joint holders

(i) The joint holders of any share/debenture shall be liable severally four persons as the holders of any
share/debentures.

Transfer by joint holders

(ii) In the case of a transfer of shares/debentures held by joint holders, the transfer will be effective only
if it is made by all the joint holders.

Liability of joint holders

(iii) The joint holders of any share/debenture shall be liable severally as well as jointly for and in respect
of all calls or instalments and other payments which ought to be made in respect of such
share/debenture.

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Death of one or more joint holders

(iv) On the death of any one or more of such joint holders the survivor/survivors shall be the only person
or persons recognised by the Company as having any title to the share/debenture, but the Directors
may require such evidence of death as they may deem fit, and nothing herein contained shall be
taken to release the estate of a deceased joint holder from any liability on shares/debentures held by
him jointly with any other person.

Receipt of one sufficient

(v) Any one of such joint holders may give effectual receipts of any dividends, interests or other moneys
payable in respect of such share/debenture.

Delivery of certificate and giving of notices to first named holder

(vi) Only the person whose name stands first in the Register of Members/debenture holders as one of the
joint holders of any shares/debentures shall be entitled to the delivery of the certificate relating to
such share/debenture or to receive notice which expression shall be deemed to include all documents
as defined in Article (2)(a) hereof and any document served on or sent to such person shall be deemed
service on all the joint holders.

Vote of joint holders

(vii) (i) Any one of two or more joint holders may vote at any meeting either personally or by attorney
or by proxy in respect of such shares as if he were solely entitled thereto and if more than one
of such joint holders be present at any meeting personally or by proxy or by attorney then that
one of such persons so present whose name stands first or higher (as the case may be) on the
Register in respect of such share shall alone be entitled to vote in respect thereof but the other
or others of the joint holders shall be entitled to be present at the meeting provided always that
a joint holder present at any meeting personally shall be entitled to vote in preference to a joint
holder present by Attorney or by proxy although the name of such joint holder present by an
Attorney or proxy stands first or higher (as the case may be) in the Register in respect of such
shares.

(ii) Several executors or administrators of a deceased member in whose (deceased member) sole
name any share stands shall for the purpose of this clause be deemed joint holders.

BORROWING POWERS

Restriction on powers of the Board

78. The Board of Directors shall not, except with the consent of the Company in General Meeting and subject
to Article 172 of the Articles of Association of the Company:

(a) sell, lease or otherwise dispose of the whole or substantially the whole, of the undertaking of the
Company, or where the Company owns more than one undertaking of the whole, or substantially
the whole, of any such undertaking.

(b) remit, or give time for the repayment of any debt due by a Director.

(c) invest, otherwise than in trust securities the amount of compensation received by the Company in
respect of the compulsory acquisition alter the commencement of this Act, of any such undertaking
as is referred to in clause (a) or of any premises or properties used for any such undertaking and
without which it cannot be carried on or can be carried on only with difficulty or only after a
considerable time.

(d) borrow monies where the moneys to be borrowed, together with the moneys already borrowed by
the Company (apart from temporary loans obtained from the Company’s bankers in the ordinary
course of business) will exceed the aggregate of the paid-up Capital of the Company and its free
reserves, that is to say, reserves not set apart for any specific purpose.

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(e) contribute, to charitable and other funds not directly relating to the business of the Company or
the welfare of its employees, any amounts the aggregate of which will, in any financial year,
exceed fifty thousand rupees or five percent, of its average net profits as determined in accordance
with the provisions of Sections 349 and 350 of the Act during the three financial year immediately
preceding, whichever is greater.

Explanation: Every resolution passed by the Company in General Meeting in relation to the
exercise of the power referred to in clause (d) or in clause (e) shall specify the total amount up to
which money may be borrowed by the Board of Directors under clause (d) or as the case may be,
the total amount which may be contributed to charitable and other funds in any financial year
under clause (e).

Conditions on which money may be borrowed

79. The Directors may raise and secure the payment of such sum or sums in such manner and upon such
terms and conditions in all respects as they think fit, and in particular by the issue of bonds, perpetual or
redeemable or such other types of debenture or debenture stocks or any mortgage or charge or other
security on the undertaking of the whole or any part of the property of the Company (both present and
future) including its uncalled Capital for the time being.

Terms of Issue of Debentures

80. Any debentures, debenture-stock or other securities may be issued at a discount, premium or otherwise
and may be issued on condition that they shall be convertible into shares of any denomination and with
any privileges and conditions as to redemption, surrender, drawing, allotment of shares, attending (but
not voting) at the General Meeting, appointment of Directors and otherwise Debentures with the right to
conversion into or allotment of shares shall be issued only with the consent of the Company in the General
Meeting by a Special Resolution

Bonds, debentures etc. to be subject to the control of Directors

Any bonds, debentures, debenture stocks or other securities issued or to be issued by the Company shall
be under the control of the Directors who may issue them upon such terms and conditions and in such
manner and for such consideration as they shall consider to be for the benefit of the Company.
Provided that bonds, debentures, debenture stocks or other securities so issued or to be issued by the
Company with the right to allotment of or conversion into shares shall not be issued except with the
sanction of the Company in General Meeting by a special resolution.

Securities may be assignable free from equities

81. Debentures, debenture stocks, bonds or other securities may be made assignable free from any equities
between the Company and the person to whom the same may be issued.

Issue at discount etc. or with special privileges

82. Any bonds, debenture stocks, or other securities may be issued, subject to the provisions of the Act, at a
discount, premium or otherwise and with any special privileges as to redemption, surrender, drawings,
appointment of Directors and otherwise and subject to the following:

Debentures with voting rights not to be issued

(a) The Company shall not issue any debentures carrying voting rights at any meeting of the Company
whether generally or in respect of particular classes of business.

(b) The Company shall have power to reissue redeemed debentures in certain cases in accordance
with Section 121 of the Act.

(c) Payments of certain debts out of assets subject to floating charge in priority to claims under the
charge may be made in accordance with the provisions of Section 123 of the Act.

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(d) Certain charges mentioned in Section 125 of the Act shall be void against the liquidators or
creditors unless registered as provided in section 125 of the Act.

(e) The term ‘charge’ shall include mortgage in these Articles.

(f) A contract with the Company to take up and pay for any debentures of the Company may be
enforced by a decree for specific performance.

Limitation of time for issue of Certificate

(g) The Company shall, within three months after the allotment of any of its debentures or debenture
stock, and within one month after the application for the registration of the transfer of any such
debentures or debenture stocks have complete and have ready for delivery the Certificate of all
the debentures and the Certificates of all debenture stocks allotted or transferred unless the
conditions of issue of the debentures or debenture stocks otherwise provide.

The expression ‘transfer’ for the purpose of this clause means a transfer duly stamped and
otherwise valid and does not include any transfer which the Company is for any reason entitled to
refuse to register and does not register.

Right to obtain copies of the inspect Trust Deed

(h) (i) A copy of any Trust Deed for securing any issue of debentures shall be forwarded to
the holder of any such debentures or any member of the Company at his request and
within seven days of the making thereof on payment.

(1) In the case of a printed Trust Deed of the sum of Rupee One and
(2) In the case of a Trust Deed which has not been printed of thirty seven paise for
every one hundred words or fractional part thereof required to be copied.

(ii) The Trust Deed referred to in item (i) above shall also be open to inspection by any
member or debenture holder of the Company in the same manner, to the same extent,
and on payment of the same fees, as if it were the Register of Members of the Company.

Mortgage of uncalled Capital

83. If any uncalled Capital of the Company is included in or charged by any mortgage or other security the
Directors shall, subject to the provisions of the Act and these Articles, make calls on the members in
respect of such uncalled Capital in trust for the person in whose favour such mortgage or security is
executed.

Indemnity may be given

84. If the Directors or any of them or any other person shall become personally liable for the payment of any
sum primarily due from the Company, the Directors may execute or cause to be executed any mortgage,
charge or security over or affecting the whole or any part of the assets of the Company by way of
indemnity to secure the Directors or person so becoming liable as aforesaid from any loss in respect of
such liability.

Registration of charges

85. (a) The provisions of the Act relating to registration of charges shall be complied with.

(b) In the case of a charge created out of India and comprising solely property situated outside India,
the provisions of Section 125 of the Act shall also be complied with.

(c) Where a charge is created in India but comprises property outside India, the instrument creating
or purporting to create the charge under Section 125 of the Act or a copy thereof verified in the
prescribed manner, may be filed for registration, notwithstanding that further proceedings may

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be necessary to make the charge valid or effectual according to the law of the country in which
the property is situated, as provided by Section 125 of the Act.

(d) Where any charge on any property of the Company required to be registered under Section 125
of the Act has been so registered any persons acquiring such property or any part thereof or any
share as interest therein shall be deemed to have notice of the charge as from the date of such
registration.

(e) In respect of registration of charges on properties acquired subject to charge, the provisions of
Section 127 of the Act shall be complied with.

(f) The Company shall comply with the provisions of Section 128 of the Act relating to particulars
in case of series of debentures entitling holders pari passu.

(g) The Company shall comply with the provisions of Section 129 of the Act in regard to
registration of particulars of commission, allowance or discount paid or made, directly or
indirectly, in connection with the debentures.

(h) The Provisions of Section 133 of the Act as to endorsement of Certificate of registration on
debenture or Certificate of debenture stock shall be complied with by the Company.

(i) The Company shall comply with the provisions of Section 134 of the Act as regards registration
of particulars of every charge and of every series of debentures.

(j) As to modification of charges, the Company shall comply with the provisions of Section 135 of
the Act.
(k) The Company shall comply with the provisions of Section 136 of the Act regarding keeping a
copy of instrument creating charge at the registered office of the Company and comply with the
provisions of Section 137 of the Act in regard to entering in the register of charges any
appointment of Receiver or Managers as therein provided.

(l) The Company shall also comply with the provisions of section 138 of the Act as to reporting
satisfaction of any charge and procedure thereafter.

(m) The Company shall keep at its registered office a Register of charges and enter therein all
charges specifically affecting any property of the Company and all floating charges on the
undertaking or on any property of the company giving in each case:

(i) a short description of the property charged;

(ii) the amount of the charge; and
(iii) except in the case of securities to bearer, the names of persons entitled to the charge.

(n) Any creditor or member of the Company and any other person shall have the right to inspect
copies of instruments creating charges and the Company’s Register of charges in accordance
with and subject to the provisions of Section 144 of the Act.

Trust not recognised

86. No notice of any trust, express or implied or constructive, shall be entered on the Register of Debenture
holders.

BOARD OF DIRECTORS

Board of Directors

126. Unless otherwise determined by the Company in General Meeting the number of Directors shall not be
less than three and not more than twelve.

The First Directors of the Company shall be:

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1. Shri Roy M Mathew

2. Shri M. Mathew
3. Shri Sosamma Mathew
4. Shri Nizzy Mathew

Appointment of Senior Executives as Whole time Directors

127. (a) Subject to the provisions of the Act and within the overall limit prescribed under these Articles for
the number of Directors on the Board, the Board may appoint any Senior Executive of the Company
as a Whole time Director of the Company for such period and upon such terms and conditions as
the Board may decide. The Senior Executive so appointed shall be governed by the following
provisions:

(i) He shall be liable to retire by rotation as provided in the Act but shall be eligible for
reappointment. His reappointment as a Director shall not constitute a break in his
appointment as Wholetime Director.

(ii) He shall be reckoned as Director for the purpose of determining and fixing the number of
Directors to retire by rotation.

(iii) He shall cease to be a Director of the Company on the happening of any event specified in
Section 283 and 314(2C) of the Act. He shall cease to be a Director of the Company, if for
any reason whatsoever he ceases to hold the position of Senior Executive in the Company
or ceases to be in the employment of the Company.

(iv) Subject to what is stated herein above he shall carry out and perform all such duties and
responsibilities as may, from time to time, be conferred upon or entrusted to him by the
Managing Director/s and/or the Board, shall exercise such powers and authorities subject to
such restrictions and conditions and/or stipulations as the Managing Director/s and/or the
Board may, from time to time determine.

(b) Nothing contained in this Article shall be deemed to restrict or prevent the right of the Board to
revoke, withdraw, alter, vary or modify all or any of such powers, authorities, duties and
responsibilities conferred upon or vested in or entrusted to such whole-time directors

Appointment of Chairman

134. The Directors may from time to time elect among themselves a chairman of the Board and determine the
period for which he is to hold office if at any meeting of the Board, the chairman is not present within
fifteen minutes after the time appointed for holding the same, the directors present may choose one of
their members to be chairman of the meeting.

Qualification of Director

135. A Director need not hold any shares in the Company to qualify him for the office of a Director of the
Company.

MANAGING DIRECTORS

Power to appoint Managing or Wholetime Directors

172. (a) Subject to the provisions of the Act and of these Articles the Board shall have power to appoint
from time to time any of its members as Managing Director or Managing Directors and/or
Wholetime Directors and/or Special Director like Technical Director, Financial Director, etc. of the
Company for a fixed term not exceeding five years at a time and upon such terms and conditions
as the Board thinks fit, and the Board may be resolution vest in such Managing Director or
Managing Directors/Wholetime Director(s), Technical Director(s), Financial Director(s) and
Special Director(s) such of the power hereby vested in the Board generally as it thinks fit, and such
powers may be made exercisable for such period or periods, and upon such condition and subject
to such restriction as it may determine, the remuneration of such Directors may be way of monthly

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remuneration and/or fee for each meeting and/or participation in profits, or by any or all of those
modes, or of any other mode not expressly prohibited by the Act.

Appointment and payment of remuneration to Managing or Wholetime Director

(b) Subject to the provisions of Sections 198, 269, 309, 310 and 311 of the Act, the appointment and
payment of remuneration to the above Director shall be subject to approval of the members in
general meeting and of the Central Government.

THE SECRETARY

Secretary

173. Subject to the provisions of Section 383 A of the Act, the Directors may, from time to time, appoint and,
at their discretion remove any individual (hereinafter called “the Secretary”) who shall have such
Qualifications as the authority under the Act may prescribe to perform any functions, which by the Act
or these Articles are to be performed, by the Secretary, and to execute any other purely ministerial or
administrative duties which may from time to time be assigned to the Secretary by the Director. The
Directors may also at any time appoint some persons (who need not be the Secretary) to keep the registers
required to be kept by the Company.

SEAL

The seal its custody and use

174. (a) The Directors shall provide a Common Seal for the purpose of the Company and shall have power
from time to time to destroy the same and substitute a new Seal in lieu thereof, and the Directors
shall provide for the safe custody of the Seal for the time being and the Seal shall never be used
except by or under the authority of the Directors or a Committee of the Directors previously given,
and in the presence of one Director or a Committee of the Directors previously given, and in the
presence of one Director at the least, who shall sign every instrument to which the Seal is so affixed
in his presence.

(b) Seal abroad

The Company shall also be at liberty to have an official seal in accordance with Section 50 of the
Act for use in any territory, district or place outside India and such powers shall accordingly be
vested in the Directors.

Unpaid or Unclaimed Dividend

190. (a) Where the Company has declared a dividend but which has not been paid or the dividend warrant
in respect thereof has not been posted within 30 days from the date of declaration to any shareholder
entitled to the payment of the dividend, the Company shall within 7 days from the date of expiry
of the said period of 30 days, open a special account in that behalf in any scheduled bank called
“Unpaid Dividend of MUTHOOTTU MINI FINANCIERS LIMITED” and transfer to the said
account, the total amount of dividend which remains unpaid or in relation to which no dividend
warrant has been posted.

(b) Any money transferred to the unpaid dividend account of the Company which remains unpaid or
unclaimed for a period of seven years from the date of such transfer, shall be transferred by the
Company to the Investor Education and Protection Fund account of the Central Government.

No claim for such transferred amount will lie against the Company or Central Government.

(c) No unpaid or unclaimed dividend shall be forfeited by the Board before the claim becomes barred
by law;

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Dividend and call together

191. Any general meeting declaring a dividend may on the recommendation of the Directors make a call on
the members for such amount as the meeting fixes, but so that the call on each member shall not exceed
the dividend payable to him so that the call be made payable at the same time as the dividend and the
dividend may, if so arranged between the Company and the members, be set off against the calls.

Dividend to be payable in cash

192. No dividend shall be payable except in cash. Provided that nothing in this Article shall be deemed to
prohibit the capitalisation of profit or reserves of the Company for the purpose of issuing fully paid up
bonus shares or paying up any amount for the time being unpaid on any shares held by the members of
the Company.

AUDIT

Accounts to be audited

206. Every Balance Sheet and Profit and Loss Account shall be audited by one or more Auditors to be
appointed as hereinafter mentioned.

Appointment and qualification of auditors

207. (a) The Company at the annual general meeting each year shall appoint an Auditor or Auditors to hold
office from the conclusion of that meeting until the conclusion of the next annual general meeting,
and shall, within seven days of the appointment, give intimation thereof to every auditor so
appointed.

(b) At any annual general meeting, a retiring Auditor, by whatever authority appointed, shall be
reappointed unless:

(i) he is not qualified for reappointment;

(ii) he has given the Company notice in writing of his unwillingness to be reappointed;

(iii) a resolution has been passed at that meeting appointing somebody instead of him or
providing expressly that he shall not be reappointed, or

(iv) where notice has been given of an intended resolution to appoint some person or persons in
the place of retiring Auditor, and by reason of the death, incapacity or disqualification of
that person or of all those persons, as the case may be, the resolution cannot be proceeded
with.

(c) Where at an annual general meeting no auditors are appointed or re-appointed, the Central
Government may appoint a person to fill the vacancy.

(d) The Company shall, within seven days of the Central Government’s power under sub-clause (c)
becoming exercisable give notice of that fact to the Government.

(e) The Directors may fill any casual vacancy in the office of Auditor, but while any such vacancy
continues the surviving or continuing Auditor or Auditors (if any) may act, but where such vacancy
be caused by the resignation of an auditor, the vacancy shall only be filled by the Company in
general meeting.

(f) A person, other than a retiring Auditor, shall not be capable of being appointed at an annual general
meeting unless special notice of the Resolution for appointment of that person to the office of
Auditor has been given by a member to the Company not less than fourteen days before the meeting
in accordance with Section 190 of the Act, and the Company shall send a copy of any such notice
to the retiring Auditor and shall give notice thereof to the members in accordance with Section 190

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of the Act, and the provisions of Section 225 of the Act shall apply in the matter. The provision of
this sub-clause shall also apply to a Resolution that a retiring Auditor shall not be re-appointed.

(g) The persons qualified for appointment as Auditors shall be only those referred to in Section 226 of
the Act.

(h) None of the persons mentioned in Section 226 of the Act as being not qualified for appointment as
Auditors shall be appointed as Auditors of the Company.

Audit of Branch Office

208. The Company shall comply with the provisions of Section 228 of the Act in relation to the audit of the
accounts of branch offices of the Company except to the extent to which any exemption may be granted
by the Central Government, in that behalf.

WINDING UP

Distribution of Assets

217. (a) Subject to the provisions of the Act, if the Company shall be would up and the assets available for
distribution among the members as such shall be less than sufficient to repay the whole of the paid
up capital such assets shall be distributed so that, as nearly, as may be, the losses shall be borne
by the members in proportion to the Capital paid up, or which ought to have been paid up, at the
commencement of winding up, on the shares held by them respectively. And if in winding up, the
assets available for distribution among the members shall be more than sufficient to repay the
whole of the Capital paid up at the commencement of the winding up the excess shall be distributed
amongst the members in proportion to the Capital paid-up at the commencement of the winding
up or which ought to have been paid up on the shares held by them respectively.

(b) But this clause will not prejudice the rights of the holders of shares issued upon special terms and
conditions.

218. Subject to the provisions of the Act.

Distribution in specie or kind

(a) If the Company shall be would up whether voluntarily or otherwise, the liquidators may with the
sanction of a special resolution and any other sanction required by the Act, divide amongst the
contributors, in specie or kind the whole or any part of the assets of the Company, and may, with
the like sanction vest any part of the assets of the Company in trustees upon such trusts for the
benefit of the contributories or any of them as the liquidators with the like sanction shall think fit.

(b) If thought expedient, any such division may, subject to the provisions of the Act, be otherwise
than in accordance with the legal rights of the contributories (except where unalterably fixed by
the Memorandum of Association) and in particular any class may be given (subject to the
provisions of the Act) preferential or special rights or may be excluded altogether or in part but in
case any division otherwise than in accordance with the legal rights of the contributories shall be
determined or any contributory who would be prejudiced thereby shall have the right, if any to
dissent and ancillary rights as if such determination were a special resolution passed pursuant to
Section 494 of the Act.

(c) In case any shares to be divided as aforesaid involved a liability to calls or otherwise, any person
entitled under such division to any of the said shares may within ten days after the passing of the
special resolution, by notice in writing direct the liquidators to sell his proportion and pay him the
net proceeds and the Liquidators shall, if practicable act accordingly.

Rights of shareholders in case of sale

219. Subject to the provisions of the Act, a special resolution sanctioning a sale to any other Company duly
passed may, in like manner as aforesaid, determine that any shares or other consideration receivable by

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the Liquidators be distributed amongst the members otherwise than in accordance with their existing
rights and any such determination shall be binding upon all the members subject to the rights of dissent,
if any, if such right be given by the Act.

SECRECY CLAUSE

220. (a) Every Director, Manager, Auditor, Treasurer, Trustee, Member of a Committee, Officer, Servant,
Agent, Accountant or other person employed in the business of the Company shall if so required
by the Directors, before entering upon his duties, sign a declaration pledging himself to observe a
strict secrecy respecting all transactions and affairs of the Company with the customers and the
state of accounts with individuals and in matters thereto, and shall by such declaration pledge
himself not to reveal any of the matters which may come to this knowledge in the discharge of his
duties except when required so to do by the Directors or by law or by the person to whom such
matters relate and except so far as may be necessary in order to comply with any of the provisions
in these presents contained.

(b) No member shall be entitled to visit or inspect any works of the Company without the permission
of the Directors or to required discovery of or any information respecting any detail of the
Company’s trading, or any matter which may relate to the conduct of the business of the Company
and which in the opinion of the Directors, it would be inexpedient in the interest of the Company
to disclose.

INDEMNITY AND RESPONSIBILITY

Directors and other rights to indemnity

221. (a) Subject to the provisions of Section 201 of the Act, every Director, Managing Director, Wholetime
Director, Manager, Secretary and other officer or employee of the Company shall be indemnified
by the Company against and it shall be the duty of the Directors, out of the funds of the Company
to pay all costs, losses and expenses (including travelling expenses) which such Director,
Manager, Secretary and Officer or employee may incur or become liable to by reason of any
contract entered into or act or deed done by him as such Director, Manager, Secretary, Officer or
Servant or in any way in the discharge of his duties including expenses and the amount for which
such indemnity is provided, shall immediately attach as a lien on the property of the Company and
have priority between the members over all other claims.

(b) Subject as aforesaid, every Director, Managing Director, Manager, Secretary or other officer and
employee of the Company shall be indemnified against any liability incurred by him in defending
any proceedings, whether civil or criminal in which judgement is given in his favour or in which
he is acquitted or discharged or in connection with any application under Section 633 of the Act
in which relief is given to him by the Court and the amount for which such indemnity is provided
shall immediately attach as a lien on the property of the Company.

Directors and other officers not responsible for the acts of others

222. Subject to the provisions of Section 201 of the Act, no Director, Managing Director, Wholetime Director
or other Officer of the Company shall be liable for the acts, receipts, neglects or defaults of any other
Director or officer or for joining in any receipt or other act for conformity or for any loss or expense
happening to the Company through insufficiency or deficiency of title to any property acquired by order
of the Directors for or on behalf of the Company or for the insufficiency or deficiency of any security in
or upon which any of the money of the Company shall be invested or for any loss or damage arising from
the bankruptcy, insolvency or tortuous act of any person, company or corporation, with whom any
moneys, securities or effects shall be entrusted or deposited or for any loss occasioned by any error of
judgment or oversight on his part or for any other loss or damage or misfortune whatever which shall
happen in the execution of the duties of the office or in relation thereto, unless the same happens through
his own dishonesty.

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SECTION IX - OTHER INFORMATION

MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The following contracts and documents (not being contracts entered into in the ordinary course of business carried
on by our Company or entered into more than two years before the date of this Prospectus) which are or may be
deemed material have been entered or/are to be entered into by our Company. These contracts which are or may
be deemed material shall be attached to the copy of this Prospectus to be delivered to the Registrar of Companies,
Kerala and Lakshadweep for registration and also the documents for inspection referred to hereunder, may be
inspected at the Registered Office of our Company from 10.00 am to 4.00 pm on Working Days from the date of
the filing of this Prospectus with the RoC until the Issue Closing Date.

Material Contracts

1. Agreement dated August 14, 2020 between the Company and the Lead Manager;

2. Agreement dated August 6, 2020 between the Company and the Registrar to the Issue;

3. Agreement dated August 7, 2020 between the Company and Vistra ITCL (India) Limited, the Debenture
Trustee;

4. Agreement dated August 26, 2020 executed by the Company, the Registrar, the Public Issue Account Bank
and the Lead Manager;

5. Syndicate Agreement dated August 21, 2020 executed between the Company and the Syndicate Member;

6. Tripartite Agreement dated January 30, 2014 between CDSL, the Company and the Registrar to the Issue;
and

7. Tripartite Agreement dated February 5, 2014 between NSDL, the Company and the Registrar to the Issue.

Material Documents

1. Certificate of Incorporation of Company dated March 18, 1998, issued by Registrar of Companies, Kerala
and Lakshadweep;

2. Fresh Certificate of Incorporation of the Company dated November 27, 2013, issued by Registrar of
Companies, Kerala and Lakshadweep pursuant to the conversion of our Company from private limited
company to a public limited company;

3. Memorandum and Articles of Association of the Company, as amended to date;

4. Certificate of registration (no. N-16.00175) dated April 13, 2002 issued by RBI under Section 45IA of the
Reserve Bank of India Act, 1934. Fresh certificate of registration issued by RBI on January 1, 2014, pursuant
to the change of name of our Company from ‘Muthoottu Mini Financiers Private Limited’ to ‘Muthoottu Mini
Financiers Limited’;

5. Certificate of registration bearing registration no. – CA0122 issued by IRDAI, with effect from April 1, 2016
(renewed on April 1, 2019), under Section 42D (1) of the Insurance Act, to act as a “Corporate Agent
(Composite)”;

6. Certificate of registration dated July 5, 2012 bearing registration number IN–DP–CDSL–660- 2012 issued by
SEBI to act as Depository Participant in terms of Regulation 20 of the Securities and Exchange Board of
India (Depositories and Participants) Regulations, 1996, renewed on August 21, 2017;

7. Credit rating letter dated August 14, 2020 from India Ratings and Research Private Limited, granting credit
ratings to the NCDs.

8. Copy of the Board Resolution dated July 20, 2020 approving the issue of NCDs to the public up to an amount
not exceeding `40,000 lakhs for the financial year 2020-2021;

237
 Muthoottu Mini Financiers Limited

9. Copy of the Debenture Committee Resolution dated July 20, 2020 approving this Issue;

10. Copy of the resolution passed by the Shareholders of the Company at the Extraordinary General Meeting held
on December 10, 2013, approving the overall borrowing limit of Company;

11. Copy of the resolution of the Debenture Committee dated August 19, 2020 approving the Draft Prospectus;

12. Copy of the resolution of the Debenture Committee dated September 7, 2020 approving this Prospectus;

13. Consents in writing of Directors of our Company, Company Secretary and Compliance Officer, Chief
Financial Officer, Statutory Auditors, legal advisor to the Issue, Lead Manager, the Registrar to the Issue,
Credit Rating Agency, the Bankers to our Company, the Debenture Trustee, IRR, the lenders to the Company,
Public Issue Account Bank, Refund Bank, and the Syndicate Member to act in their respective capacities,
have been obtained and will be filed along with a copy of this Prospectus with the RoC as required under
Section 26 of the Companies Act, 2013;

14. Our Company has received written consent from the Statutory Auditor, namely Vishnu Rajendran & Co., to
include its name as required under Section 26(1)(a)(v) of the Companies Act, 2013 in this Prospectus and as
an “expert” as defined under Section 2(38) of the Companies Act, 2013 to the extent and in its capacity as a
statutory auditor, in respect of the: (a) Audited Ind AS Financial Statements dated July 20, 2020; (b)
Reformatted Financial Statement dated August 14, 2020; and (c) its report dated August 14, 2020 on the
statement of tax benefits, included in this Prospectus. The consent of the Statutory Auditors has not been
withdrawn as on the date of this Prospectus;

15. The audit report of the Statutory Auditors, namely Vishnu Rajendran & Co., dated July 20, 2020, in relation
to the Audited Ind AS Financial Statements along with relevant schedules and annexures for the financial
year ended as on March 31, 2020 included herein;

16. The examination report of the Statutory Auditors dated August 14, 2020 in relation to the Reformatted
Summary Financial Statements included herein;

17. Annual Reports of the Company for 2019, 2018, 2017 and 2016;

18. A statement of tax benefits dated August 14, 2020 issued by Statutory Auditors regarding tax benefits
available to us and our Debenture Holders;

19. Due diligence certificate dated September 7, 2020 filed with SEBI by the Lead Manager; and

20. In-principle listing approval letter dated August 27, 2020 issued by BSE, for the Issue.

Any of the contracts or documents mentioned in this Prospectus may be amended or modified at any time if so
required in the interest of our Company or if required by the other parties, without reference to the Applicants
subject to compliance of the provisions contained in the Companies Act and other relevant statutes.

238
Date: September 7, 2020
Place: Kochi

239
 Muthoottu Mini Financiers Limited

ANNEXURE I

DAY COUNT CONVENTION

Interest on the NCDs shall be computed on an actual/actual basis for the broken period, if any. For Options I, II,
IV and VI the interest shall be calculated from the first day till the last date of every month on an actual/actual
basis during the tenor of such NCDs. Consequently, interest shall be computed on a 365 day a year basis on the
principal outstanding on the NCDs. However, if period from the Deemed Date of Allotment/anniversary date of
Allotment till one day prior to the next anniversary/redemption date includes February 29, interest shall be
computed on 366 days a-year basis, on the principal outstanding on the NCDs.

For Options III, V and VII interest shall be computed on a 365 day a year basis on the principal outstanding on
the NCDs which have tenors on cumulative basis.

Illustration of cash-flows: To demonstrate the day count convention, please see the following table below, which
describes the cash-flow in terms of interest payment and payment of Redemption Amount per NCD for all
Categories of NCD Holders.

INVESTORS SHOULD NOTE THAT THIS EXAMPLE IS SOLELY FOR ILLUSTRATIVE PURPOSES
AND IS NOT SPECIFIC TO THE ISSUE

Company Muthoottu Mini Financiers Limited

Face Value `1,000
Day and Date of Allotment (tentative) Monday, October 12, 2020
Options Option II Option III
Tenure 24 Months 24 Months
Coupon (%) for NCD Holders in Category I, II and III 9.75% N.A.
Frequency of the Interest Payment with specified dates Monthly Cumulative
starting from date of allotment
Day Count Convention Actual/Actual

Option II

Company Muthoottu Mini Financiers Limited

Face Value `1,000
Day and date of Allotment (tentative) Monday, October 12, 2020
Tenure 24 Months
Coupon (%) for NCD Holders in Category I, II and III 9.75%
Frequency of the Interest Payment with specified dates Monthly
starting from date of allotment
Day Count Convention Actual/Actual

No. of days in Amount

Date of interest/redemption
Cash flow Coupon/maturity
payment (2) (in `)
period
1st coupon Monday, November 2, 2020 20 5.34
2nd coupon Tuesday, December 1, 2020 30 8.01
3rd coupon Friday, January 1, 2021 31 8.28
4th coupon Monday, February 1, 2021 31 8.28
5th coupon Monday, March 1, 2021 28 7.48
6th coupon Friday, April 2, 2021 31 8.28
7th coupon Monday, May 3, 2021 30 8.01
8th coupon Tuesday, June 1, 2021 31 8.28
9th coupon Thursday, July 1, 2021 30 8.01
10th coupon Monday, August 2, 2021 31 8.28

240
 Muthoottu Mini Financiers Limited

No. of days in Amount

Date of interest/redemption
Cash flow Coupon/maturity
payment (2) (in `)
period
11th coupon Wednesday, September 1, 2021 31 8.28
12th coupon Friday, October 1, 2021 30 8.01
13th coupon Monday, November 1, 2021 31 8.28
14th coupon Wednesday, December 1, 2021 30 8.01
15th coupon Saturday, January 1, 2022 31 8.28
16th coupon Tuesday, February 1, 2022 31 8.28
17th coupon Tuesday, March 1, 2022 28 7.48
18th coupon Saturday, April 2, 2022 31 8.28
19th coupon Monday, May 2, 2022 30 8.01
20th coupon Wednesday, June 1, 2022 31 8.28
21st coupon Friday, July 1, 2022 30 8.01
22nd coupon Monday, August 1, 2022 31 8.28
23rd coupon Thursday, September 1, 2022 31 8.28
24th coupon Saturday, October 1, 2022 30 8.01
25th coupon Tuesday, October 11, 2022 11 2.94
Principal Tuesday, October 11, 2022 - 1000.00
Maturity value

Option III

Company Muthoottu Mini Financiers Limited

Face Value `1,000
Day and Date of Allotment (tentative) Monday, October 12, 2020
Tenure 24 Months
Redemption Amount (`/NCD) for NCD Holders in Category `1,205
I, II and III
Frequency of the Interest Payment with specified dates Cumulative
starting from date of allotment
Day Count Convention Actual/Actual

No. of days in
Date of interest/redemption Amount
Cash flow Coupon/maturity
payment (2) (in `)
period
Principal/Maturity Tuesday, October 11, 2022 730 1,205
value

NOTES:

1. Effect of public holidays has been ignored as these are difficult to ascertain for future period except January
26, April 1, May 1, August 15, October 2 day have been taken into consideration.
2. As per SEBI circular no. CIR/IMD/DF-1/122/2016, dated November 11, 2016, in order to ensure uniformity
for payment of interest/redemption on debt securities, the interest/redemption payment shall be made only on
the days when the money market is functioning in Mumbai. Therefore, if the interest payment date falls on a
non-Working Day, the coupon payment shall be on the next day, which will be the day on which money
market in Mumbai is functioning has been considered as the effective interest payment date. However, the
future coupon payment dates would be as per the schedule originally stipulated. In other words, the
subsequent coupon schedule would not be disturbed merely because the payment date in respect of one
particular coupon payment has been postponed earlier because of it having fallen on a holiday. However, if
the redemption date of the debt securities falls on non- Working Day, the redemption proceeds shall be paid
on the previous Working Day.
3. Deemed Date of Allotment has been assumed to be Monday, October 12, 2020.
4. The last coupon payment will be paid along with maturity amount at the redemption date.

241
 Muthoottu Mini Financiers Limited

ANNEXURE II

CREDIT RATING LETTER AND RATIONALE

APPENDED OVERLEAF

242
Ms. Ann Mary George
Chief Financial Officer,
Mini Muthoottu Tech Towers,
Kaloor,
Cochin – 682017,
Kerala, India.

August 14, 2020

Dear Sir/Madam,

Re: Ratings of Muthoottu Mini Financiers Limited’s (MMFL)

India Ratings (see definition below) assigns the following debt rating to MMFL:-

INR4 bn Non-convertible debentures: ‘IND BBB’: Outlook Stable

India Ratings (see definition below) upgrades the following debt rating to MMFL:-

NR3.12bn (decreased from INR4.39bn) Non-convertible debentures: ‘IND BBB’: Outlook Stable
Out of the above MMFL has issued INR2.29bn of Non-convertible debentures.

In issuing and maintaining its ratings, India Ratings relies on factual information it receives from issuers and underwriters and from other sources
India Ratings believes to be credible. India Ratings conducts a reasonable investigation of the factual information relied upon by it in accordance
with its ratings methodology, and obtains reasonable verification of that information from independent sources, to the extent such sources are
available for a given security.

The manner of India Ratings' factual investigation and the scope of the third-party verification it obtains will vary depending on the nature of the
rated security and its issuer, the requirements and practices in India where the rated security is offered and sold, the availability and nature of
relevant public information, access to the management of the issuer and its advisers, the availability of pre-existing third-party verifications such as
audit reports, agreed-upon procedures letters, appraisals, actuarial reports, engineering reports, legal opinions and other reports provided by third
parties, the availability of independent and competent third-party verification sources with respect to the particular security or in the particular
jurisdiction of the issuer, and a variety of other factors.

Users of India Ratings’ ratings should understand that neither an enhanced factual investigation nor any third-party verification can ensure that all
of the information India Ratings relies on in connection with a rating will be accurate and complete. Ultimately, the issuer and its advisers are
responsible for the accuracy of the information they provide to India Ratings and to the market in offering documents and other reports. In issuing
its ratings India Ratings must rely on the work of experts, including independent auditors with respect to financial statements and attorneys with
respect to legal and tax matters. Further, ratings are inherently forward-looking and embody assumptions and predictions about future events that
by their nature cannot be verified as facts. As a result, despite any verification of current facts, ratings can be affected by future events or
conditions that were not anticipated at the time a rating was issued or affirmed.

India Ratings seeks to continuously improve its ratings criteria and methodologies, and periodically updates the descriptions on its website of its
criteria and methodologies for securities of a given type. The criteria and methodology used to determine a rating action are those in effect at the
time the rating action is taken, which for public ratings is the date of the related rating action commentary. Each rating action commentary provides
information about the criteria and methodology used to arrive at the stated rating, which may differ from the general criteria and methodology for
the applicable security type posted on the website at a given time. For this reason, you should always consult the applicable rating action
commentary for the most accurate information on the basis of any given public rating.

Ratings are based on established criteria and methodologies that India Ratings is continuously evaluating and updating. Therefore, ratings are the
 collective work product of India Ratings and no individual, or group of individuals, is solely responsible for a rating. All India Ratings reports have
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The individuals are named for contact purposes only.

Ratings are not a recommendation or suggestion, directly or indirectly, to you or any other person, to buy, sell, make or hold any investment, loan or
security or to undertake any investment strategy with respect to any investment, loan or security or any issuer. Ratings do not comment on the
adequacy of market price, the suitability of any investment, loan or security for a particular investor (including without limitation, any accounting
and/or regulatory treatment), or the tax-exempt nature or taxability of payments made in respect of any investment, loan or security. India Ratings
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valuation or actuarial services. A rating should not be viewed as a replacement for such advice or services. Investors may find India Ratings
ratings to be important information, and India Ratings notes that you are responsible for communicating the contents of this letter, and any changes
with respect to the rating, to investors.

It will be important that you promptly provide us with all information that may be material to the ratings so that our ratings continue to be
appropriate. Ratings may be raised, lowered, withdrawn, or placed on Rating Watch due to changes in, additions to, accuracy of or the inadequacy
of information or for any other reason India Ratings deems sufficient.

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We are pleased to have had the opportunity to be of service to you. If we can be of further assistance, please contact the undersigned at +91 22
4000 1700.

Sincerely,

India Ratings

Rakesh Valecha Prakash Agarwal

Senior Director Director

Muthoottu Mini Financiers Limited 14-August-2020

 Annexure: Facilities Breakup

ANNEXURE
Instrument ISIN Date of Coupon Rate Maturity Size of Issue Rating/
Issuance (%) Date (million ) Outlook

NCD INE101Q08019 8 August 2014 13.43 4 February INR496.3 WD (Paid in

2020 full)

NCD INE101Q08027 12 November 12 11 May 2020 INR118.8 WD (Paid in

2014 full)

NCD INE101Q08043 12 November 12.75 11 May 2020 INR25.2 WD (Paid in

2014 full)

NCD INE101Q08050 12 November 13.43 11 May 2020 INR570.3 WD (Paid in

2014 full)

NCD INE101Q08068 7 April 2015 12 7 December INR151.1 IND

2020 BBB/Stable

NCD INE101Q08076 7 April 2015 13.01 7 December INR533.8 IND

2020 BBB/Stable

NCD INE101Q07342 27 January 2016 10.22 27 March INR61.3 WD (Paid in

2020 full)

NCD INE101Q08084 27 January 2016 10.5 27 July 2022 INR121.0 IND

BBB/Stable

NCD INE101Q08092 27 January 2016 11.25 27 July 2022 INR319.1 IND

BBB/Stable

NCD INE101Q07359 24 April 2019 9.25 17 August INR103.4 IND

2020 BBB/Stable

NCD INE101Q07367 24 April 2019 9.67 17 August INR325.6 IND

2020 BBB/Stable

NCD INE101Q07375 24 April 2019 9.75 24 April 2022 INR153.5 IND

BBB/Stable

NCD INE101Q07383 24 April 2019 10.22 24 April 2022 INR193.4 IND

BBB/Stable

NCD INE101Q07391 24 April 2019 10 24 April 2024 INR179.7 IND

BBB/Stable

Muthoottu Mini Financiers Limited 14-August-2020

 NCD INE101Q07409 24 April 2019 10.47 24 April 2024 INR211.5 IND
BBB/Stable

Utilised limit INR2,292.1

Unutilised INR4,832.9
limit

Total INR7,124.9

Muthoottu Mini Financiers Limited 14-August-2020

 Login

India Ratings Assigns Muthoottu Mini Financier’s Additional

NCDs ‘IND BBB’/Stable; Upgrades Existing Ratings

14
AUG 2020

By Sohail Pathan

India Ratings and Research (Ind-Ra) has taken the following rating actions on Muthoottu Mini Financiers
Limited’s (MMFL) debt instruments:

Instrument Date of Coupon Maturity Size of Rating/Outlook Rating

Type Issuance Rate Date Issue Action
(million)

Bank loans - - - INR5,000 IND BBB/Stable Upgraded

Non- - - - INR3,124.9 IND BBB/Stable Upgraded

convertible (reduced
debentures from
(NCDs*) INR4,396.9)

Proposed - - - INR4,000 IND BBB/Stable Assigned

NCDs#

*details in Annexure
#the amount is unallocated

The upgrade factors in MMFL’s extensive experience in the gold loan financing business; stability of the gold asset
class funded by MMFL; increasing opportunities’ in the business given the credit squeeze in the market; its stable asset
quality; moderately-improved profitability and adequate liquidity and capital buffers. The ratings factor in MMFL’s
improved asset under management (AUM) per branch and its significant presence in the gold finance business in the
southern states.

The ratings, however, are constrained by MMFL’s high regional concentration for assets and liabilities; high market risk
in gold loan business, which can convert into credit risk; moderate funding diversification; evolving systems, processes
and record-keeping; moderate operating performance as reflected in low internal accruals than peers; high operating
cost and concentrated product portfolio.

KEY RATING DRIVERS

/
Extensive Experience in Gold Loans Business: MMFL has over two decades of experience in the gold finance
business in the highly-competitive markets of Kerala and Tamil Nadu. Loans against gold have inherent strength, as
the collateral – gold - is highly liquid in nature. Furthermore, the company has been expanding its portfolio in a difficult
operating environment with loan growth in the core gold finance business of around 22% yoy in FY20 with AUM
reaching INR16,909 million. Additionally, MMFL securitised loans to the tune of INR3,417.6 million in FY20. MMFL’s
operating efficiency, measured through AUM per branch, improved to INR21 million in FY20 (FY19: INR18 million).
Scaling of the loan book could further improve the company’s operational efficiency in the medium term.

Asset Quality Remains Stable; Can turn Volatile with Gold Prices: In FY20, MMFL’s gross non-performing
assets (NPAs) marginally improved to 1.89% (FY19: 2.16%) on 90 days’ past due NPA recognition. Its pre-provision
operating buffer stood at 1.6% of the total average assets in FY20 (FY19: 1.5%). The company’s migration to shorter-
tenor products has reduced lending yields derived from overdue customers, thereby impacting operating margins. The
interest receivable portion of MMFL’s loan book stood at around 5% of AUM in FY20, inferring delays in servicing by
customers or customers opting for bullet payment, leading to higher yield for MMFL on that portion of loan. However,
the resolution and classification of NPAs is based on the occurrence of over dues in principal, after the end of the loan
tenor. MMFL maintains a filter at 85% of the loan-to-value (LTV) at which the loan was disbursed to initiate resolution,
leading to the closing of the loan by the borrower or in case of a delay, auctioning post intimating the borrower. In the
current rising gold price scenario, MMFL has moved to shorter tenor of three to six months since August 2020, than
the previous nine months. However, any significant movement in gold prices in the near term could lead to higher
auction risk.

Liquidity Indicator - Adequate: As per the March 2020 asset liability statement, MMFL had a cumulative mismatch
of INR816 million in one of the short-term buckets post moratorium consideration in contractual inflows but availability
of unutilised bank lines largely provided adequate cover.

At end-June 2020, MMFL had unencumbered cash of INR305 million and unutilised bank lines of around INR904
million, which the agency believes provides adequate cover to the repayments of around INR1,117 million due in the
three months ending September 2020. MMFL raised around INR2,000 million through the issuance of public NCDs in
1QFY21. At end-June 2020, the average tenure on asset side is around nine months, and 48 months on the liability
side for NCDs. This, along with the highly liquid nature of gold, keeps MMFL’s asset liability profile comfortable.

Improved Profitability: During FY20, MMFL’s return on asset rose to 1.7% in FY20 (FY19: 1.1%) due to the growth
in AUM and controlled credit cost. However, MMFL’s profitability remains weak than its higher-rated peers, largely due
to its high operational costs.

Funding Mix Yet to Diversify: In FY20, MMFL majorly depended on NCDs sourced from Kerala that formed around
73% of its borrowing mix and the balance from bank funding through working capital and term loans. The agency
believes the company’s growth plans and liquidity situation could come under pressure, if MMFL’s dependence on NCDs
sourced from the local (Kerala) market remained high. Historically, the company has shown the ability to mobilise
funds from local high net worth individuals and retail borrowers through Kerala’s branch network where a large part of
investors in NCDs are repeat investors. MMFL has also demonstrated the capability of raising funds through
securitisation from banks in FY20 and FY19, largely due to granularity and liquid nature of loan collateral, thereby
adding additional avenue to mobilise funds, in event of stress in operating environment.

Internal Control Systems and Compliance Still Evolving: MMFL’s internal processes, largely those for capturing,
monitoring and processing the branch-level activities, are still evolving. In this context, MMFL is reviewing its internal
processes and has appointed external IT firm to revamp its entire legacy systems. Ind-Ra would closely monitor the
company’s efforts in improving its record-keeping and management information system systems, with a focus on
strengthening the internal process, which would augment the management’s control over the business.

High Operating Cost: MMFL’s operating cost remains higher than peers’ largely due to its small scale of operations
and lower AUM per branch. The company has no major branch (FY20: 784; FY19: 766) expansion plan in FY21 and its
focus is on improving the operational efficiency through growing its AUM per branch. MMFL’s cost-to-income ratio was
at 78.5% in FY20 (FY19: 77.8%); however, the agency believes the company’s operating expense will only moderate
with the scaling of the loan book over the medium term.

/
Average Capital Buffers: MMFL’s capitalisation remained stable in FY20 with tier-1 capital ratio of 24.57% (FY19:
25.1%) and capital adequacy ratio of 25.7% (38.1%). The overall capital adequacy ratio has moderated due to
reclassification of tier-2 capital in FY20. MMFL had leverage (debt/equity) of 2.9x in FY20 (FY19: 2.3x). However, a
sizeable part of this capital is locked in the form of fixed assets; fixed asset-to-equity stood at 39.5% in FY20 (FY19:
43.5%).

COVID-19 Impact: A majority of MMFL’s operations is concentrated in southern India - Kerala (11% of total
operations), Tamil Nadu (41%), Karnataka (21%) and Andhra Pradesh (23%). With the COVID-19 contagion having
moved towards the rural areas, local lockdowns are impacting the operations in these regions largely in terms of cash
collection and sanctioning of new gold loans, as customers walk-ins have moderated However, across different asset
class financing, gold has relatively been performing well due to lower loss given default risk, even though the
probability of default can be higher due to the borrower’s vulnerable profile.

Ind-Ra expects the recent surge in gold price would provide a significant scope for MMFL’s further lending as the LTV
would have moderated on overall book; the company’s LTV on overall book stood at around 55%, as at end-1QFY21.
MMFL’s loan book under moratorium stood at around 17%, as on 10 August 2020. The collection on overall principal
matured during April-July stood at INR13,935 million. However, there exists a risk of a sudden fall in gold price for the
book under moratorium, where a sudden fall can drive the LTV higher due to accrued interest on certain portion of
portfolio, leading to heightened auction risk.

RATING SENSITIVITIES

Positive: A demonstrated ability to improve the efficiency of internal systems with improving management information
systems and increased control on branch vigilance; sustained improvement in the capital and profitability buffers along
with lower operational cost and the successful execution of growth strategy would be the key drivers for a positive
rating action. Also, the diversification of the funding profile, including the ability to tie up funding together, can lead to
a positive rating action.

Negative: A negative rating action could result from the company’s inability to raise funds through new banking
channels or public NCDs or a sharp rise in the delinquencies, which could constrict capital as well as liquidity, or
inability to maintain above-average capital buffers. Also, any business diversification in terms of the acquisition of fixed
assets or related-party transactions, which would lead to moving away from the key line of business, would lead to a
rating review. A significant increase of leverage (5x) on a sustained basis, or 25% sharp decline in gold prices in a
month, leading to loss post auction in a particular month/quarter will lead to negative rating action

While the company’s internal systems and processes are evolving, any sudden regulatory action due to non-compliance
may also lead to a rating downgrade. Moreover, any material change in the regulatory policy impacting a gold loan
company’s viability or competitive advantage would lead to a negative rating action.

COMPANY PROFILE

MMFL, a Kerala-based non-deposit taking non-banking finance company, lends against high-yielding gold jewellery,
which forms around 97% of the total loans. It also has around 3% portion of its AUM as micro finance loans.
Incrementally, MMFL plans to grow in the northern geographies of Gujarat and Maharashtra in gold loans segment.

FINANCIAL SUMMARY

Particulars FY20 FY19*

Total assets (INR million) 20,259 18,360

Total equity (INR million) 4,816 4,473

Net profit (INR million) 336 210

Return on assets (%) 1.7 1.1 /

 Equity/Asset (%) 23.8 24.4

Tier 1 capital (%) 22.2 25.1

GNPA (%) 1.89 2.16

Source: MMFL
* Indian Generally Accepted Accounting Principles

RATING HISTORY

Instrument Type Current Rating/Outlook Historical Rating/Outlook

Rating Type Rated Rating 7 August 14 August 2018 3 August

Limits 2019 2017
(million)

Bank loans Long term INR5,000 IND BBB/Stable IND IND BBB-/Stable IND
BBB-/Stable BBB-/Stable

NCDs Long-term INR7,124.9 IND BBB/Stable IND IND BBB-/Stable IND

BBB-/Stable BBB-/Stable

ANNEXURE

Instrument ISIN Date of Issuance Coupon Maturity Date Size of Rating/

Rate Issue Outlook
(%) (million )

NCD INE101Q08019 8 August 2014 13.43 4 February 2020 INR496.3 WD (Paid in full)

NCD INE101Q08027 12 November 2014 12 11 May 2020 INR118.8 WD (Paid in full)

NCD INE101Q08043 12 November 2014 12.75 11 May 2020 INR25.2 WD (Paid in full)

NCD INE101Q08050 12 November 2014 13.43 11 May 2020 INR570.3 WD (Paid in full)

NCD INE101Q08068 7 April 2015 12 7 December 2020 INR151.1 IND BBB/Stable

NCD INE101Q08076 7 April 2015 13.01 7 December 2020 INR533.8 IND BBB/Stable

NCD INE101Q07342 27 January 2016 10.22 27 March 2020 INR61.3 WD (Paid in full)

NCD INE101Q08084 27 January 2016 10.5 27 July 2022 INR121.0 IND BBB/Stable

NCD INE101Q08092 27 January 2016 11.25 27 July 2022 INR319.1 IND BBB/Stable

NCD INE101Q07359 24 April 2019 9.25 17 August 2020 INR103.4 IND BBB/Stable

NCD INE101Q07367 24 April 2019 9.67 17 August 2020 INR325.6 IND BBB/Stable

NCD INE101Q07375 24 April 2019 9.75 24 April 2022 INR153.5 IND BBB/Stable

NCD INE101Q07383 24 April 2019 10.22 24 April 2022 INR193.4 IND BBB/Stable

NCD INE101Q07391 24 April 2019 10 24 April 2024 INR179.7 IND BBB/Stable

NCD INE101Q07409 24 April 2019 10.47 24 April 2024 INR211.5 IND BBB/Stable

Utilised limit INR2,292.1

Unutilised limit INR4,832.9

Total INR7,124.9

/
COMPLEXITY LEVEL OF INSTRUMENTS

For details on the complexity level of the instruments, please visit [Link]

SOLICITATION DISCLOSURES

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Rating FI Subsidiaries and Holding Companies

Analyst Names

Primary Analyst
/
Sohail Pathan

Analyst
India Ratings and Research Pvt Ltd Wockhardt Towers, 4th floor, West Wing Plot C-2, G
Block. Bandra Kurla Complex Bandra (East), Mumbai 400051

Secondary Analyst
Jinay Gala

Senior Analyst
+91 22 40356138

Committee Chairperson
Prakash Agarwal

Director and Head Financial Institutions

+91 22 40001753

Media Relation
Ankur Dahiya

Manager – Corporate Communication

+91 22 40356121

/
 Muthoottu Mini Financiers Limited

ANNEXURE III

CONSENT OF THE DEBENTURE TRUSTEE

APPENDED OVERLEAF

243
 Ref. No.:

August 07, 2020

Muthoottu Mini Financiers Limited

Mini Muthoottu Tech Towers,
Kaloor, Cochin – 682 017,
Kerala, India

Dear Ma’am/Sir

Sub: Proposed Public Offering of Secured Redeemable Non-Convertible Debenture (“NCDs”)

aggregating up to `20,000 lakhs ("Issue") of Muthoottu Mini Financiers Limited (“Company”).

We, the undersigned, hereby consent to be named as the Debenture Trustee to the Issue and to our
name being inserted as the Debenture Trustee to the Issue in the Draft Prospectus to be filed with
the BSE Limited (“Stock Exchange”) and to be forwarded to Securities and Exchange Board of India
(“SEBI”) and the Prospectus to be filed with the Registrar of Companies, Kerala and Lakshadweep
(“RoC”), Stock Exchange and to be forwarded to SEBI in respect of the Issue and also in all related
advertisements and communications sent pursuant to the Issue. The following details with respect
to us may be disclosed:

Name: Vistra ITCL (India) Limited

Address: The IL&FS Financial Centre, Plot C – 22, G Block,
Bandra Kurla Complex, Bandra (East), Mumbai – 400051
Tel: 022 – 2659 3333
Fax: 022 - 26533297
Email: itclcomplianceofficer@[Link]
Investor Grievance email: itclcomplianceofficer@[Link]
Website: [Link]
Contact Person: Mr. Jatin Chonani- Compliance Officer
SEBI Registration No: IND000000578

We confirm that we are registered with SEBI and that such registration is valid as on the date of this
letter. We are enclosing herewith a copy of our registration certificate. We also confirm that we
have not been prohibited by SEBI to act as an intermediary in capital market issues.

We hereby authorise you to deliver this letter of consent to the RoC, pursuant to the provisions of
Section 26 of the Companies Act, 2013 and other applicable laws or any other regulatory/statutory
authorities as required by law.

We also agree to keep strictly confidential, until such time as the proposed transaction is publicly
announced by the Company in the form of a press release, (i) the nature and scope of this
transaction; and (ii) our knowledge of the proposed transaction of the Company.

We confirm that we will immediately inform you and the Lead Manager of any change to the above
information until the date when the NCDs commence trading on the BSE Limited. In the absence of
any such communication from us, the above information should be taken as updated information
until the NCDs commence trading.

Registered office:
The IL&FS Financial Centre, Tel +91 22 2659 3535
Plot C- 22, G Block, 7th Floor Fax: +912226533297 Vistra ITCL (India) Limited
Bandra Kurla Complex, Bandra (East), Email: mumbai@[Link]
Mumbai 400051 [Link] Corporate Identity Number (CIN):U66020MH1995PLC095507
 This letter may be relied upon by you, the Lead Manager and the legal advisor to the Issue in respect
of the Issue.

Sincerely

For Vistra ITCL (India) Limited

Authorised Signatory
Name: Sandesh Vaidya
Designation: Manager

CC:

Vivro Financial Services Private Limited

607-608 Marathon Icon
Veer Santaji Lane
Opp. Peninsula Corporate Park
Off Ganpatrao Kadam Marg
Lower Parel
Mumbai- 400013

Khaitan & Co
One Indiabulls Centre
13th Floor, Tower 1,
Senapati Bapat Marg,
Mumbai 400 013
Maharashtra, India

Without Prejudice:
This No Objection Certificate (NOC) is issued by Vistra ITCL (India) Ltd (“Vistra”) in its capacity as a
Debenture Trustee to Muthoottu Mini Financiers Limited and this shall be valid for thirty (30)
calendar days from the date of its issue. In the event the purpose of issuing this NOC is not initiated
within 30 calendar days then this NOC shall automatically stand cancelled/invalid and would not
have any legal force and effect. Please note that this NOC is issued based on the information/records
available with Vistra and this shall not be construed as making any recommendation in any manner.

Registered office:
The IL&FS Financial Centre, Tel +91 22 2659 3535
Plot C- 22, G Block, 7th Floor Fax: +912226533297 Vistra ITCL (India) Limited
Bandra Kurla Complex, Bandra (East), Email: mumbai@[Link]
Mumbai 400051 [Link] Corporate Identity Number (CIN):U66020MH1995PLC095507
 Muthoottu Mini Financiers Limited

ANNEXURE IV

STATEMENT OF ACCOUNTING RATIOS

APPENDED OVERLEAF

244
 Vishnu Rajendran & Co
Chantered Accountqnts

Annexure I
Accounting Ratio Statement:

Earnings Per Share - Basic ft) 13.44 8.40 4.37 t36.04) 4.35
Earnings Per Share - Diluted tt) 73.44 8.40 4.31 t36.041 4.35
Return on Net Worth [%J 7.060/o 4.73o/o 3.38o/o (22.17o/o) 2.20o/o
Net Asset Value per Equity Share L90.28 777.46 769.70 762.56 797.57
tr)
Weighted Avg. No. of Equity Shares 2,49,52,539 2,49,52,53 2,37,29,62 2,25,00,00 2,25,00,00
used in calculating Basic EPS 9 B 0 0

Weighted Avg. No. of Equity Shares 2,49,52,539 2,49,52,53 2,37,28,62 2,25,00,00 2,25,00,00
used in calculating Diluted EPS 9 B 0 0
Total No. of Equity Shares 2,49,52,539 2,49,52,53 2,49,52,53 2,25,00,00 22,500,00
\ outstanding at the end of the year / 9 9 0 0
period
*. The Company has adopted Ind AS notified under Section ISS o7 theiompanies laiad with the
companies (Indian Accounting standards) Rules, 207s as amended, from April 7, 2079 and the
effective date of such transition is April 1, 2018. Such transition has been carried out
from the
erstwhile Accounting Standards notified under the Companies Act. Accordingly, the impact of
transition has been recorded in the opening reserves as at April 7, 2018 and the corresponding
figurri,
presented in these results, have been restated/ reclassified. Therefore, the
financial informa{ion cts on
March 31, 2020 are not comparable with previous years ftnancial information.

Notesr
1. The ratios have been computed as below:
a' Earnings per Share = Net Profit/ (Loss) attributable to equity shareholders Weighted average
/
number ofequity shares outstanding during the year
b. Return on Net worth (%) = Net profit/ (Loss) after tax / Net worth at the end of the year.
c. Net Assets Value per Equity Share C) = Net Worth at the end of the year Number of equity
/
shares outstanding at the end ofthe year

2. Net Worth = Share Capital (+) Other Equity or Reserves and Surplus excluding revaluation reserves
. and deferred revenue expenditure.

For Vishnu Rajendran & Co.

Chartered Accountants
Firm Registration No: 004741S
Peer Review No: 011622
UDIN:2020710

Membership No: 20L107

3'd Floor, CSI Commercial Centre, Baker Jn., p. B. No. 227, Kottayam - 686 001
lTel: 0481 2301999, 258L999 I Mob: 98498T0062 t Emait: kottayam@[Link] I

Kottayam|Bangalore|Trivandru-m|Ettumanoor|Kochi|Kannur|C@
'
http: / / [Link]
 Muthoottu Mini Financiers Limited

ANNEXURE V

STATEMENT OF CAPITALISATION

APPENDED OVERLEAF

245
 Vishnu Rajendran & Co
Chartered Accountants

Annexure I

Capitalization Statement as at 3l / 03 / 2O20

Debt
Debt Securities 7,76,280.78 20,000.00 1_,36,280.78
Borrowings [other than Debt Securilies) 36,543.85 36,543.85
Total Debts 1,52,824,63 20,000.00 L,72,824.63

Eqqitv
Equity Share Capitql 24,952.54 24,952.54
OtherEquly
Special Reserve Fund 4,740.07 4,740.07

Securities Premium_ 7,844.L5 - T,[Link]

Debenture Redemption Reserve
Retained Earnings 10273.56 70273.56

Total Equity 47,8LO.32 47,BLO.32

Debt 3.20 3.6L

*As per Indian Accounting Standards (IND
AS) notified under section 733 of the Companies A:cl 2013 read
with relevant rules issued thereunder.

Notes:
1. Debt Securities includes interest accrued but not due thereon but excluding unamortized expense of
public issues.
2. The figures disclosed above are based on the Audited Financial Statements of the Company as at
March 37,2020.
3. Debt / Equity = Total Debt / Equity.
4. The debt-equity ratio post the Issue is indicative and is on account of inflow of t 20,000 lakhs from
the proposed public issue and does not include contingent and off-balance sheet liabilities. The
actual debt-equity ratio post the Issue would depend upon the actual position of debt and equity on
the date of allotment.
5. The Company has raised secured non-convertible debenture amounting to < 79,790.67 Lakhs
through public issue during April 7,2020 - fuly 31, 2020 impact of which is not provided in the
above table.

6. The Company has raised funds through Subordinated Debt amounting to \ 2,772.88 Lakhs during
April 1, 2020 - July 31, 2020 impact of which is not provided in the above table.
7. The Company during April 1, 2020 - July 31, 2020 redeemed secured privately placed non-
convertible debenture amounting to t 120.00 lakhs and unsecured privately place non rtible
debenture amounting to t 245.00 lakhs impact of which is not provided ir
B. The Company during April 1, 2020 - fuly 31, 2020 has redeemed unse of non-

3d Floor, CSI Commercial Centre, Baker Jn., P. B. No. 227,

lTel: 0481 2301999,2581999 lMob: 9349870062 lEmail: kot
Kottayam I Bangalore I Trivandruml Ettumanoor I Kochi I Kannur I Calicut I Chennai I
'
http: / /[Link]
Vishnu Rajendran & Co
Chartered Accountants

convertible debenture amounting lo17,743.37lakhs impact of which is notprovided inthe above

table.
9. Other Equity does not include revaluation reserve.
10. Debt Securities does not include unclaimed matured debentures and interest thereon amounting to
t 353.57 Lakhs.
ForVishnu Raiendran & Co.
Chartered Accountants
Firm Registration No: 004741S
Peer Review No:011622
UDIN: 20207707AAM

Partner
Membership No: 201101

3'd Floor, CSI Commercial Centre, Baker Jn., P' B. No. 227, Kottayam - 686 001
lTel: 0481 2301999,2581999 lMob: 9349870062 lBrnail: kottayam@r,[Link] I

Kottayam t Bangalore I Trivandruml Ettumanoor I Kochi I Kannur I Calicut I Chennai I

http: / /[Link]
 Muthoottu Mini Financiers Limited

ANNEXURE VI

STATEMENT OF DIVIDENDS

APPENDED OVERLEAF

246
 Vishnu Rajendran & Co
Chartered Accountants

Annexure I

Statement of Dividend

(:f. In lakhs, except per share data)

On Eguity Shares
Fully Paid-UJ2 Share Ca12ital (Nos.) 2,49,52,539 2,49,52,539 2,49,52,539 2,25,00,000 2,25,00,000
Face Value L Paid UJ2 Value (!) 100 100 100 100 100

Eguity Share Ca12ital 24,952.54 24,952.54 24,952.54 22,500.00 22,500.00

Rate of Dividend 0.00% 0.00% 0.00% 0.00% 0.00%
Dividend
Dividend Distribution Tax

) For Vishnu Rajendran & Co.

Chartered Accountants
Firm Registration No: 004741S
Peer Review No: 011622
UDIN : 20201101AAAAD

.A. Joseph, FCA

Partner
Membership No: 201101

3rd Floor, CSI Commercial Centre, Baker Jn., P. B. No. 227, Kottayam - 686 001
I Tel: 0481 2301999, 2581999 I Mob: 9349870062 I Email: kottayam@vrc. [Link] I
Kottayam I Bangalore I Trivandrum I Ettumanoor I Kochi I Kannur I Calicut I Chennai I
· [Link]