Bajaj Finserv Ltd.

Directors' Report

The directors present their Twelfth Annual Report and audited financial statements for the year ended 31 March 2019.

Financial results

The financial results of the Company are elaborated in the Management Discussion and Analysis Report.

The highlights of the Standalone Financial Results are as follows:

Closing balances in reserve/other equity

Note: Detailed movement of above reserves can be seen in 'Statement of Changes in Equity'. The highlights of the Consolidated Financial Results are as follows:

Dividend

Your directors recommend for consideration of the shareholders at the ensuing Annual General Meeting (AGM), payment of a dividend of Rs.2.50 per eguity share (50%) of face value of Rs.5 each for the year ended 31 March 2019. The amount of dividend and the tax thereon to the extent applicable aggregate to Rs. 39.79 crore.

For the year ended 31 March 2018, the dividend paid was Rs.1.75 per eguity share (35%) of face value of Rs.5 each. The amount of dividend and the tax thereon to the extent applicable aggregated to Rs. 27.85 crore.

Share capital

The paid-up eguity share capital as on 31 March 2019 was Rs 79.57 crore consisting of 159,136,111 fully paid-up eguity shares of face value of Rs.5 each. During the Rights Issue of eguity shares made by the Company in 2012, certain shares had been kept in abeyance as reguired by law. With resolution of a few cases during the year under review, the Company has allotted 1,014 eguity shares of the face value of Rs.5 each at the original Rights Issue price of Rs. 650 per share to the eligible shareholders.

There was no public issue, rights issue, bonus issue or preferential issue, etc. during the year under review. The Company has not issued shares with differential voting rights or sweat eguity shares.

Classification of the Company as a Core Investment Company (CIC)

The Company having satisfied the criteria specified for being a CIC, not reguiring registration with RBI pursuant to the provisions of section 45-IA of RBI Act, 1934, had applied to RBI in this regard on 26 June 2015.

In response to the above, RBI vide its Order dated 23 October 2015 has cancelled the certificate of registration to carry on the business of NBFC issued to the Company and has confirmed the eligibility of the Company as a CIC, not requiring registration with RBI, pursuant to the provisions of section 45-IA of the RBI Act, 1934. The Company is thus a CIC under the said provisions.

Operations

Detailed information on the operations of the different business lines of the Company and details on the state of affairs of the Company are covered in the Management Discussion and Analysis Report.

Inclusion in BSE SENSEX 50

With effect from 24 December 2018, the Company has been included in the BSE Sensex 50 of BSE Ltd.

Adoption of Confederation of Indian Industry (CII) Charters

Your Company, being a member of Cll, has adopted the following Code/Charters:

1. Model Code of Conduct for Ethical Business Practices

2. Charter on Fair & Responsible Workplace Guidelines for Collaborative Employee Relations

3. Charter on Fair & Responsible Workplace Guidelines for Contact Labour.

Extract of annual return

The extract of annual return as provided under sub-section (3) of section 92 of the Companies Act, 2013, in the prescribed form MGT-9 is annexed to this Report.

Number of meetings of the Board

Six meetings of the Board were held during the year. Detailed information is given in the Corporate Governance Report.

Directors' responsibility statement

As required under clause (c) of sub-section (3) of section 134 of the Companies Act, 2013, directors, to the best of their knowledge and belief, state that:

• in the preparation of the annual accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

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

• the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• the directors had prepared the annual accounts on a going concern basis;

• the directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

• the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Details in respect of frauds reported by auditors under section 143(12)

During the year under review, there were no frauds reported by the Statutory Auditors to the Audit Committee or the Board under section 143(12) of the Companies Act, 2013.

Declaration by independent directors

The independent directors have submitted the declaration of independence, as required pursuant to section 149(7) of Companies Act, 2013, stating that they meet the criteria of independence as provided in section 149(6) of the said Act and regulation 16 of SEBI Listing Regulations, 2015.

The Board took on record the declaration and confirmation submitted by the independent directors regarding their meeting the prescribed criteria of independence, after undertaking due assessment of the veracity of the same as required under regulation 25 of SEBI Listing Regulations, 2015.

Directors' Remuneration Policy and criteria for matters under section 178

The Board, at its meeting held on 12 March 2019, have revised the sitting fees from Rs. 50,000 to Rs.100,000 and commission from Rs.50,000 to Rs. 150,000 payable per meeting to all non-executive directors (including independent directors) for meetings of the Board and/or committees thereof attended by them from 1 April 2019 onwards.

The salient features and changes to the Policy on directors' appointment and remuneration forms a part of the 'Corporate Governance Report'. The said policy is placed on the Company's website www.bajajfinserv.in

Particulars of loans, guarantees or investments

Information regarding loans, guarantees and investments covered under section 186 of Companies Act, 2013 are detailed in the financial statements.

Related party transactions

No Related Party Transactions (RPTs) were entered into by the Company during the year under review which attracted the provisions of section 188 of Companies Act, 2013. There being no 'material' RPTs as defined under regulation 23 of SEBI Listing Regulations, 2015, there are no details to be disclosed in form AOC-2 in that regard.

During the year 2018-19, pursuant to section 177 of Companies Act, 2013, and regulation 23 of SEBI Listing Regulations, 2015, all RPTs were placed before the Audit Committee for its approval.

The revised Policy on materiality of RPTs and also on dealing with RPTs has been formulated by the Board at its meeting held on 16 July 2014 and amended on 14 October 2014. The said Policy was further amended, inter alia, stipulating the threshold limits on 12 March 2019 and the same is placed on the Company's website www.bajajfinserv.in

Material changes and commitments

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year and the date of this Report.

Conservation of energy and technology absorption

The Company is engaged in wind-farm activities in addition to its financial services activities. A summary of the performance of the wind power division is available in the Management Discussion and Analysis which forms part of this Annual Report. Being essentially a financial services Company, no particulars regarding technology absorption are required to be given in this Report.

Particulars regarding conservation of energy are as follows:

a) Steps taken to conserve energy and utilise alternate sources of energy:

The Company has installed a renewable energy (wind) project with a capacity of 65.2 MW. During the year under review, it generated 876 lakh units which it sold to third parties.

It, however, is unable to make captive use of wind energy, because new regulations do not permit the same where monthly demand is less than 700 KW. The Company has installed LED lamps in place of failed tube lights and CFL, thereby reducing energy consumption in lighting by around 11,405 KWh units during the year.

b) Capital investment on energy conservation equipment:

Not applicable, since BFS is a non-manufacturing Company and not coming under the notified industries covered under Energy Conservation Act, 2001. Also, energy demand/ connected load of building utilised for the Company's corporate/commercial activities, etc. is less than 500 KW, which is the minimum threshold for applicability of the Energy Conservation Act, 2001.

Foreign exchange earnings and outgo

Total foreign exchange earned by the Company was Rs.Nil during the year under review, as well as during the previous year.

Total foreign exchange outflow during the year under review was Rs.0.85 crore, as against Rs. 0.67 crore during the previous year.

Risk Management Policy

Information on the development and implementation of a Risk Management Policy for the Company including identification therein of elements of risk, which in the opinion of the Board may threaten the existence of the Company, is given in the Corporate Governance Report.

Corporate Social Responsibility (CSR)

Detailed information on the CSR Policy developed and implemented by the Company on CSR initiatives taken during the year pursuant to section 135 of Companies Act, 2013, is given in the annexed Annual Report on CSR activities.

Formal annual evaluation of the performance of the Board, its Committees, Chairperson and Individual Directors

Information on the manner in which formal annual evaluation has been made by the Board of its own performance and that of its Committees, Chairperson and Individual Directors is given in the Corporate Governance Report.

Subsidiary and Joint Venture

Following are the subsidiary and joint venture companies of the Company as at 31 March 2019

Detailed information on the performance and financial position of each subsidiary/joint venture of the Company is covered in the Management Discussion and Analysis Report.

Directors and Key Managerial Personnel-Changes

A. Change in Directorate

i. Cessation as non-executive Chairman

Rahul Bajaj, (DIN 00014529), vide his letter dated 15 February 2019, has tendered resignation as the non-executive Chairman of the Company to be effective from 16 May 2019 after the Board meeting.

The Board places on record its sincere appreciation for the invaluable advice and guidance provided by Rahul Bajaj as the non-executive Chairman of the Company since its inception.

ii. Appointment/re-appointment of directors

(a) The Board at its meeting held on 23 October 2018, pursuant to the recommendation of Nomination and Remuneration Committee appointed the following as additional directors:

• Anami N Roy (DIN 01361110) as an Independent Director for a first term of five consecutive years with effect from 1 January 2019.

• Manish Kejriwal (DIN 00040055) as non-executive and non-independent director with effect from 1 January 2019.

(b) Further, the Board at its meeting held on 12 March 2019, after taking into account the report of their performance evaluation and the recommendation of the Nomination and Remuneration Committee, re-appointed the following Independent Directors for a second term of five consecutive years:

* Consent of the members by way of Special Resolution is sought by the Company in compliance with regulation 17(1A) of SEBI Listing Regulations, 2015, for continuance of Nanoo Pamnani as an independent director of the Company beyond 26 February 2020, on account of his attaining the age of 75 years on 26 February 2020.

** Consent of the Members by way of Special Resolution is sought by the Company in compliance with regulation 17(1 A) of SEBI Listing Regulations, 2015, for continuance of DJ Balaji Rao beyond 1 April 2019, on account of his having already attained the age of 75 years as on 1 April 2019.

(c) Continuation as Director

As required under regulation 17(1 A) of SEBI Listing Regulations, 2015, consent of the members by way of Special Resolution is sought by the Company in compliance with regulation 17(1A) of SEBI Listing Regulations, 2015, for continuance of Rahul Bajaj, (DIN 00014529) as non-executive director and Chairman of the Company beyond the age of 75 years with effect from 1 April 2019 up to 16 May 2019.

(d) Appointment of Chairman

The Board of Directors at its meeting held on 12 March 2019 appointed Nanoo Pamnani as Chairman of the Company with effect from 17 May 2019.

(e) Appointment as Chairman Emeritus

Rahul Bajaj has made a huge contribution to the spectacular success of the Company and the Group over five decades. Considering his tremendous experience, the interest of the Company to avail his services and benefit from his valuable knowledge and wisdom from time to time in an advisory and mentoring role in future as well, the Board of Directors at its meeting held on 12 March 2019, as recommended by the Nomination and Remuneration Committee, approved the appointment of Rahul Bajaj as Chairman Emeritus of the Company with effect from the conclusion of the Board meeting held on 16 May 2019. While giving his consent to act as such, Rahul Bajaj stated that he would not accept any emoluments (sitting fee and commission) as Chairman Emeritus.

Necessary details regarding their appointment and re-appointment as required under Companies Act, 2013 and SEBI Listing Regulations, 2015 are given in the Notice of AGM. The aforesaid appointments are subject to approval of shareholders at the ensuing AGM.

iii. Retirement by Rotation

The independent directors hold office for a fixed term not exceeding five years from the date of their appointment and are not liable to retire by rotation.

Companies Act, 2013, mandates that at least two-thirds of the total number of directors (excluding independent directors) shall be liable to retire by rotation and one-third of such directors shall retire from office at every AGM. Accordingly, Madhur Bajaj (DIN 00014593), director, being the longest in the office amongst the four directors liable to retire by rotation, retires from the Board by rotation this year and, being eligible, has offered his candidature for re-appointment.

Prescribed details of Madhur Bajaj, director, who is seeking re-appointment are given in the Notice of AGM.

B. Change in KMP

There was no change in Key Managerial Personnel during the year under review. Detailed information on the directors is provided in the Corporate Governance Report.

Significant and material orders passed by the regulators or courts

During the year under review, there were no significant and material orders passed by the regulators or courts or tribunals, which may impact the going concern status of the Company and its operations in future.

Internal audit

At the beginning of each financial year, an audit plan is rolled out after the same has been approved by Audit Committee. The audit plan is aimed at evaluation of the efficacy and adequacy of internal control systems and compliance thereof, robustness of internal processes, policies and accounting procedures, compliance with laws and regulations. Based on the reports of internal audit function, process owners undertake corrective action in their respective areas. Significant audit observations and corrective actions thereon are presented to the Audit Committee.

Details of internal financial controls with reference to the financial statements

The Company has documented its internal financial controls considering the essential components of various critical processes. This includes its design, implementation and maintenance along with periodical internal review of operational effectiveness and sustenance, which are commensurate with the nature of its business and the size and complexity of its operations.

This ensures orderly and efficient conduct of its business, including adherence to the Company's policies, safeguarding of its assets, prevention of errors, accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

The internal financial controls with reference to the financial statements were adequate and operating effectively.

Maintenance of cost records

Provisions relating to maintenance of cost records as specified by the Central Government under section 148 of Companies Act, 2013, are applicable to the Company and the same have been complied with for the financial year 2018-19.

Presentation of financial statements

As per notification no. G.S.R. 365 (E) dated 30 March 2016, issued by Ministry of Corporate Affairs (MCA) in exercise of power conferred to it under section 133 read with section 469 of the Companies Act, 2013, NBFCs having net worth of rupees five hundred crore or more are required to comply with the Indian Accounting Standards (Ind AS) in preparation of their financial statements and quarterly financial results for the accounting periods beginning on or after 1 April 2018 with effective transition date of 1 April 2017.

Further, MCA, in exercise of its power under sub-section (1) of section 467 of the Companies Act, 2013, amended Schedule III to Companies Act, 2013. Vide the amendment, a new division, viz. 'Division III' financial statement format was introduced for Non-Banking Financial Companies effective from 11 October 2018.

Accordingly, the financial statements of the Company for the year ended 31 March 2019 and corresponding figures for the year ended 31 March 2018 have been re-casted and prepared as per the revised Schedule III to Companies Act, 2013.

Consolidated financial statements

The directors also present the audited consolidated financial statements incorporating the duly audited financial statements of the subsidiaries and joint ventures, and as prepared in compliance with the Companies Act, 2013, applicable Ind AS and SEBI Listing Regulations, 2015.

A separate statement containing the salient features of our subsidiaries and joint ventures in the prescribed form AOC-1 is annexed.

Employee stock option scheme

During the year 2018-19, the Company adopted BFS ESOS on 19 July 2018 and since then there has been no change in the BFS ESOS. The BFS ESOS is in compliance with SEBI (Share Based Employee Benefits) Regulations, 2014 ('the SBEB Regulations').

Disclosures pertaining to the ESOP Scheme pursuant to the SBEB Regulations are placed on the Company's website www.bajajfinserv.in/miscellaneous

Grant wise details of options are provided in the notes to the standalone financial statements.

Statutory disclosures

• The summary of the key financial of the Company's subsidiaries and joint venture in form AOC-1 is included in this Annual Report. A copy of the audited financial statements for each of the subsidiary companies will be made available to members of the Company seeking such information at any point of time. The audited financial statements for each of the subsidiaries will be kept for inspection by any member of the Company at its registered office during business hours. The same are placed on the Company's website www.bajajfinserv.in

• Details as required under section 197(12) of Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed to this Report.

• Details as required under section 197(12) of Companies Act, 2013 read with rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of the Directors' Report, will be made available to any shareholder on request, as per the provisions of section 136(1) of the said Act.

• A Cash Flow Statement for the year 2018-19 is attached to the Balance Sheet.

• Pursuant to the legislation 'The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013', the Company has a Policy on Prevention of Sexual Harassment at Workplace and has constituted an Internal Complaints Committee. There was no case reported during the year under review under the said Policy.

Corporate governance

Pursuant to SEBI Listing Regulations, 2015, a separate chapter titled Corporate Governance has been included in this Annual Report, along with the reports on Management Discussion and Analysis and General Shareholder Information.

All Board members and Senior Management Personnel have affirmed compliance with the Code of Conduct for the year 2018-19. A declaration to this effect signed by the Managing Director & CEO of the Company is contained in this Annual Report.

The Managing Director & CEO and CEO have certified to the Board with regard to the financial statements and other matters as required under regulation 17(8) of SEBI Listing Regulations, 2015.

The Certificate from the Statutory Auditors of the Company regarding compliance of conditions of corporate governance is annexed to this Report.

Business Responsibility Report

Regulation 34(2) of SEBI Listing Regulations, 2015, inter alia, provides that the annual report of the top 500 listed entities based on market capitalisation (calculated as on 31 March of every financial year) shall include a Business Responsibility Report (BRR).

Since BFS is one of the top 500 listed entities, the Company, as in the previous years, has presented its BRR for the year 2018-19, which is part of this Annual Report. As a green initiative, the BRR has been hosted on the Company's website www.bajajfinserv.in

A physical copy of the BRR will be made available to any shareholder on request.

Secretarial standards of ICSI

Pursuant to the approval given on 10 April 2015 by the Central Government to the Secretarial Standards specified by the Institute of Company Secretaries of India (ICSI), the Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) came into effect from 1 July 2015. The said standards were amended with effect from 1 October 2017. The Company is in compliance with the same.

Auditors Statutory Auditor

Pursuant to the provisions of section 139 of the Companies Act, 2013, the members at the 10th AGM of the Company held on 19 July 2017 appointed S R B C& CO LLP, Chartered Accountants (firm registration No. 324982E/E300003) as Statutory Auditors of the Company from the conclusion of 10th AGM till the conclusion of 15th AGM, covering one term of five consecutive years.

The Statutory Audit Report for the year 2018-19, being unmodified, does not contain any qualification, reservation or adverse remark or disclaimer by the Statutory Auditors.

Secretarial Auditor

Pursuant to the provisions of section 204 of Companies Act, 2013, and the Rules made thereunder, the Company has re-appointed Shyamprasad D Limaye, Practising Company Secretary (membership no. 1587), to undertake the secretarial audit of the Company. The Secretarial Audit Report for the year 2018-19 as issued by him in the prescribed form MR-3 is annexed to this Report.

Pursuant to amendments under SEBI Listing Regulations, 2015 and SEBI circular dated

8 February 2019, a certificate on secretarial compliance report as required under regulation 24A is being submitted to stock exchanges as obtained from him for the year 2018-19.

The said Reports do not contain any qualification, reservation or adverse remark or disclaimer by the Secretarial Auditor.

Cost Auditor

Pursuant to section 148 of the Companies Act, 2013, and the Rules made thereunder, the Board of Directors had, on the recommendation of the Audit Committee, re-appointed Dhananjay V Joshi & Associates (firm registration no. 000030), Cost Accountants, to audit the cost accounts of the Company for the financial year 2019-20 on a remuneration of Rs. 60,000 plus taxes, out-of-pocket, travelling and living expenses, subject to ratification by the shareholders at the ensuing AGM. Accordingly, a resolution seeking members' ratification for the remuneration payable to the Cost Auditor is included in the Notice convening the AGM.

On behalf of the Board of Directors

Rahul Bajaj Chairman

Pune:16 May 2019

CSR at Bajaj Finserv and its subsidiaries

Introduction

'Society must profit from profit itself. That's what our group's founding father was committed to. That is what we are committed to today. That's what we will continue to do in the future. Our Group's CSR activities are guided by the vision and philosophy of our founding father, Shri Jamnalal Bajaj, who embodied this value in our business and laid the foundation for finding numerous ways to give back to the ecosystem we are a part of.

'Social empowerment' is at the heart of all our CSR activities. We work with various partners to make good quality services, be it healthcare or education or training for employability, accessible and affordable to all sections of society. We believe this helps individuals to unlock and activate their true potential.

Our focus areas

Healthcare

Number of lives impacted: 1,30,000

Good quality healthcare services are available to only a privileged few. Over the last 4 years, we have partnered with various organizations to make healthcare services accessible and affordable to all strata of society. Our financial support for medicines and treatment and our grants for hospital equipment, especially in remote geographies, ensure that people can access and afford good quality healthcare. Children being our focus area, we support treatment of congenital heart disease, cleft, and palate reconstruction surgeries, treatment for childhood cancers, epilepsy, Type II diabetes, vision care, etc. for children.

Protection

Number of lives impacted: 7,000 children

Thousands of children in street situations battle hardships like dysfunctional families, impoverishment, malnutrition, illness, and illiteracy. If these roadblocks can be removed, these children can lead an independent and dignified life and contribute to the country as productive citizens. We support various partners that provide shelter, education, as well as care for street children, abandoned children, and children in vulnerable communities. We hope to create an inclusive environment that channelizes the energies of these children towards productive purposes.

Employability

Number of lives impacted: 2,000 graduates

Less than one-third of the country's graduates are found employable by the corporate sector. The problem is more pronounced for first-generation graduates and graduates from smaller towns. The vast potential of India's educated youth is under-utilized as they are unable to find employment opportunities appropriate to their academic qualification and have to settle for lower quality jobs. Our Certificate Programme in Banking, Finance, and Insurance (CPBFI) is designed to build capabilities (knowledge, skills, and attitude) and provide opportunities to graduates. Bajaj Finserv partners with various colleges across locations to conduct CPBFI for their students and alumni.

Education

Number of lives impacted: 7,500 children

We work with several partners to support projects like schools for children with special needs, municipal schools, night schools, and open schools for children who could not continue with their education. Throuqh these initiatives, we hope to provide an equal opportunity for all children to access education and shape a better future for themselves.

Annual Report on CSR activities

1. Brief outline of the Company's CSR Policy, including overview of projects or programmes proposed to be undertaken and a reference to the web-link to the CSR Policy and projects or programmes.

Introduction

The Corporate Social Responsibility (CSR) activities of the Bajaj Group are guided by the vision and philosophy of its Founder, Late Jamnalal Bajaj, who embodied the concept of Trusteeship in business and common good, and laid the foundation for ethical, value-based and transparent functioning.

The Bajaj Group believes that the true and full measure of growth, success and progress lies beyond Balance Sheets or conventional economic indices. It is best reflected in the difference that business and industry make to the lives of people.

Through its social investments, the Bajaj Group addresses the needs of communities residing in the vicinity of its facilities, taking sustainable initiatives in the areas of health, education, water, environment conservation, infrastructure and community development, and response to natural calamities. For society, thus, Bajaj is more than a corporate identity. It is a catalyst for social empowerment. It is the reason behind the smiles that light up a million faces.

Its goodwill resonates in the two simple words that live in the collective consciousness of Indians- Hamara Bajaj.

Guiding Principles

The Bajaj Group believes that social investments should:

• Benefit generations: The Company believes in 'investment in resource creation' for use over generations. It tries to identify sustainable projects which will benefit society over long periods.

• Educate for self-reliance and growth: To usher in a growth-oriented society and thereby a very strong and prosperous nation by educating each and every Indian.

• Promote health: The Company believes good health is a pre-reguisite for both education and productivity.

• Encourage self-help: To guide and do hand holding for self-help, individually and collectively, to create excellence for self and for the team.

• Be focused: The Company believes that activities should be preferably focused around locations where the Company has a presence and hence can effectively guide, monitor and implement specific projects.

• Target those who need it most: Care for sections of society which are socially and economically at the lowest rung, irrespective of their religion or caste or language or colour.

• Sustain natural resources: The Company encourages balanced development and ensures least adverse impact on the environment - Growth with Mother Nature's blessings.

CSR Policy

A detailed CSR Policy was framed by the Company on 14 May 2014, with approval of the CSR Committee and the Board of Directors. The Policy, inter alia, covers the following:

Philosophy

Scope

List of CSR activities

Modalities of execution of Projects/Programmes

Implementation through CSR Cell

Monitoring and Assessment of Projects/Programmes

The CSR Policy gives an overview of the projects or programmes that will be undertaken by the Company from time to time.

The CSR Policy is placed on https://www.bajajfinserv.in/miscellaneous-csr-policy.pdf

2. The Composition of the CSR Committee

A Committee of directors, titled 'Corporate Social Responsibility Committee', was constituted by the Board at its meeting held on 27 March 2014. It has the following members:

Rahul Bajaj, Chairman Nanoo Pamnani, Member Sanjiv Bajaj, Member

During the year under review, the Committee met four times, on 20 September 2018, 9 October 2018,19 December 2018 and 22 February 2019.

3. Average net profit of the Company for last three financial years prior to 2018-19: Rs. 74.56 crore.

4. Prescribed CSR Expenditure (2% of amount as in Item No. 3): Rs.1.49 crore.

5. Details of CSR spent during the financial year:

(Rs. In Crore) Particulars

Total Amount to be spent 1.49

Amount Spent 1.53

Amount Unspent, if any (a-b): Nil

Manner in which amount spent/committed during the financial year As provided in Table 1

6. In case the Company fails to spend the 2% of the average net profit of the last three financial years, the reasons for not spending the amount shall be stated in the Board report: Not Applicable

In addition, the Bajaj Group implements many CSR initiatives of substantial value through its Group Charitable Trusts operating at various locations in the country.

Major initiatives that continued and/or that were taken up anew by the Bajaj Group through such entities during the year under review are given in another detailed Report, which is hosted on the Company's website www.bajajfinserv.in and a physical copy of this Report will be made available to any shareholder on request.

7. Responsibility statement of the CSR committee that the implementation and monitoring of CSR Policy is in compliance with the CSR objectives and Policy of the Company.

The CSR Committee confirms that the implementation and monitoring of the CSR Policy is in compliance with the CSR objectives and Policy of the Company.

Table 1: Report on manner of expenditure for CSR during the financial year ended 31 March 2019

Notes: Amounts mentioned above under Serial No. 2 to 5 relate to amounts spent through implementing agencies, while Serial No. 1 relates to amount directly spent by the Company.

Extract of Annual Return (Form MGT-9) As on the financial year ended 31 March 2019

[Pursuant to section 92(3) of Companies Act, 2013 and rule 12(1) of Companies (Management and Administration) Rules, 2014]

II. Principal business activities of the Company

III. Particulars of holding, subsidiary and associate companies

IV. Shareholding pattern

(equity share capital break up as percentage of total equity)

NOTES: 1.Anant Bajaj, part of the promoter group expired on 10 August 2018.30,107 shares (0.02%) held by him are in the process of transmission. 2. Includes shares held in other capacities, as applicable.

iv) Change in shareholding of top ten shareholders

(other than directors, promoters and holders of GDRs and ADRs)