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Baid Finserv Ltd.

BSE: 511724 Sector: Financials
NSE: N.A. ISIN Code: INE020D01022
BSE 00:00 | 11 Aug 23.95 2.15
(9.86%)
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NSE 05:30 | 01 Jan Baid Finserv Ltd
OPEN 23.45
PREVIOUS CLOSE 21.80
VOLUME 33779
52-Week high 26.85
52-Week low 3.01
P/E 29.94
Mkt Cap.(Rs cr) 288
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 23.45
CLOSE 21.80
VOLUME 33779
52-Week high 26.85
52-Week low 3.01
P/E 29.94
Mkt Cap.(Rs cr) 288
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Baid Finserv Ltd. (BAIDFINSERV) - Director Report

Company director report

To

The Members

Baid Leasing and Finance Co. Ltd.

The Board of Directors are pleased to present the 30th(Thirtieth) AnnualReport of your Company together with the Audited Annual Financial Statements for theFinancial Year ("FY") ended on 31st March 2021.

1. FINANCIALPERFORMANCE

The highlights of Company's financial performance for the Financial Year ended on 31stMarch 2021are summarized below:

(Amount in Rs.)
Particulars 31st March 2021 31st March 2020
Total Revenue 541087448 627853268
Less: Total Expenditure 438196123 524257896
Profit / (Loss) before Taxation 102891325 103595372
Tax expenses 28096788 27522702
Profit / (Loss) after Tax 74794538 76072671

2. PERFORMANCE REVIEW AND STATE OF COMPANY'S AFFAIRS

Total Incomefor the FY 2020-21 under review were Rs. 541087448as againstRs.627853268in the previous FY 2019-20. The profit before tax for the FY 2020-21 is Rs.102891325as against Rs.103595372in the previous FY 2019-20. The profit after tax isRs. 74794538 for the FY 2020-21 as against Rs.76072671/-in the previous FY 2019-20.

The Company has recorded a decline in revenue of 13.82 % during the year under review.

The asset size of Company during the year under review were Rs. 2490474078.71 asagainst Rs. 2679549262.64in the FY 2019-20. The performance from both the sectors areas follows:

F.Y Particulars Vehicle Loan against property
2020-21 Asset Under Rs. 258251709.75 Rs. 2232222368.96
2019-20 Management Rs. 402707436.64 Rs. 2276841826

The improvement in the revenues is a result of the aggressive marketing and robustcollections. The Company endeavors to continue the tremendous growth rate.

In FY 2020-21 the Gross and Net NPAs stood at 3.51% and 1.61% as compared to 3.44% and1.94%% in FY 201920 respectively.

The Company continued to prudently manage its Asset Liability Management (ALM) with astrategy of raising longterm borrowings from Banks Financial Institutions and NBFC's.

Given the COVID-19 situation the outlook for the coming year is expected to beextremely demanding. In the current situation lending businesses face four dauntingchallenges of:

(i) disruption in business acquisition

(ii) providing customers adequate relief on their debt servicing obligations

(iii) dealing with incapacitated customer services and debt recovery infrastructureand

(iv) continuing to service their own debt.

To overcome the COVID-19 crisis Governments across the world will look to thefinancial sector to help revive their economies the Government and the Regulator haveannounced a number of measures to support these vulnerable segments as well as facilitateavailability of funds at favourable rates for the financiers. With this much neededsupport coupled with a relentless execution it is possible that the economy may be ableto maintain an overall positive growth rate with an earlier-than-expected recovery duringthe next financial year.

3. DIVIDEND

Your Board of Directors is pleased to recommend final dividend to reward itsshareholders with 5% i.e. Rs. 0.50 per equity share on face value of Rupee 10/- each forthe Financial Year 2020-21 subject to the approval of the members in the 30th AnnualGeneral Meeting (AGM). There was no interim dividend declared during the reporting period.

In view of the amendment to the Income Tax Act 1961 through the Finance Act 2020imposition of dividend distribution tax has been abolished. The dividend if declared atthe ensuing AGM will be taxable in the hands of the members of the Company. For furtherdetails on taxability please refer Notice of AGM.

The total dividend payout for the final dividend of Financial Year 2020-21 is Rs.6003415 (Rupees Sixty Lakh Three Thousand Four Hundred Fifteen Only) on total12006830equity share.

4. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY /CHANGEIN THE NATURE OF THE BUSINESS

The ongoing COVID-19 pandemic has increased the estimation uncertainty in thepreparation of the Financial Statements for the year ended 31st March 2021.The Companyhas developed various accounting estimates in these Financial Statements based onforecasts of economic conditions which reflect expectations and assumptions as at 31stMarch 2021 about future events that the Management believe are reasonable in thecircumstances. There is a considerable degree of judgment involved in preparing forecasts.The underlying assumptions are also subject to uncertainties which are often outside thecontrol of the Company. Accordingly actual economic conditions are likely to be differentfrom those forecast since anticipated events frequently do not occur as expected and theeffect of those differences may significantly impact accounting estimates included inthese financial statements.

The significant accounting estimates impacted by these forecasts and associateduncertainties are predominantly related to expected credit losses fair value measurementand recoverable amount assessments of non-financial assets.

However in order to address this risk and to seamlessly carry out normal operationsthe Company immediately activated its Business Continuity Plan ("BCP").The Company has honoured all its debt obligations on time.

The Company is continuously endeavoring to deal with the situation and boostcollections by means of incentivizing customers to make regular payments. However theextent of impact is difficult to crystallize.

The COVID-19 pandemic which is a once in a lifetime occurrence has brought with it anunimaginable suffering to people and to almost all sections of the economy. The nationwidelockdowns to curtail the transmission of disease had put the global economy in extremestress of the level not seen since the Great Depression and would have a long-lastingeconomic impact.

The dynamic and evolving nature of the pandemic with its resurgence (second wave) atthe close of the year once again creates uncertainty including economic impact.Hopefully the outreach of vaccination drives across the country additional efforts toset up medical infrastructure and obtain required medical supplies in addition tocontinued adherence to COVID-19 specific protocols will help in overcoming this testingsituation.

Like the greater economy the pandemic coupled with the lockdown and relief measuresprovided by RBI had a bearing on the performance of the Company.

Save and except the affect of the above there have been no material changes andcommitment that have occurred after the closure of the Financial Year 2020-21 till thedate of this Report which would affect the financial position of your Company.

5. TRANSFER TO THE INVESTOR EDUCATION AND PROTECTION FUND

In terms of Section 124 & 125 of the Companies Act 2013 read with the InvestorEducation and Protection Fund Authority (Accounting Audit Transfer and Refund) Rules2016 as amended from time to time dividends which remains unpaid or unclaimed for aperiod of 7 (seven) years from the date of transfer to unclaimed dividend account arerequired to be transferred to the Investors Education and Protection Fund. There were nounclaimed/unpaid dividend liable for transfer to the Investors Education and ProtectionFund for the reporting Financial Year under review.

6. ANNUAL RETURN

In accordance with the provisions of Companies (Amendment) Act 2017 read with Section134(3) of the Companies Act 2013 the Annual Return under Section 92 (3) of theCompanies Act 2013 is hosted on the website of the Company athttps://www.balfc.com/corporate-governance/.

7. TRANSFER TO RESERVE FUND

Reserves and Surplus Account as at March 31 2021 of your Company increased by 6.40 %to Rs. 1255678729 as against Rs. 1180176149/-as at March 31 2020.

Under section 45-IC(1) of Reserve Bank of India Act 1934 non-banking financialcompanies (NBFCs) are required to transfer a sum not less than 20% of its net profit everyyear to reserve fund before declaration of any dividend. Accordingly the Company hastransferred a sum of Rs. 14958908/- to Special Reserve in compliance with theprovisioning norms of the RBI.

The Board has not transferred any amount to the General Reserve for the period underreview.

8. ASSOCIATE COMPANIES JOINT VENTURE AND SUBSIDIARY COMPANIES

Your Company does not have any Company which is its subsidiary or associate. Hence thedetails of this clause are not applicable to the Company.

9. DIRECTORS/ KEY MANAGERIAL PERSONNEL APPOINTMENT/ RE-APPOINTMENT/ CESSATION

During the year under review following changes took place in the Composition of Boardof Directors and Key Managerial Personnel of the Company:

Board of Directors

A. Directors liable to retire by rotation: In accordance with the provisions of theAct and the rules made there under and the Articles of Association of the Company Mr.Aman Baid Director of the Company is liable to retire by rotation at the ensuing AnnualGeneral ('AGM') Meeting and being eligible has offered himself for reappointment.

Mrs. Alpana Baid retired by rotation and was re-appointed in the previous AGM held onSeptember 30 2020.

B. Re-appointment of Chairman and Managing Director/ Whole Time Director: Mr. PannaLal Baid was reappointed as Chairman and Managing Director and Mr. Aman Baid wasre-appointed as Whole Time Director for a period of 3 years with effect from April 1 2021and June 1 2020 respectively in the previous AGM held on September 30 2020.

The present Directors of the Company are as follows:

Sl. No. Name of Director Designation
1 Mr. Panna Lal Baid Chairman & Managing Director
2 Mr. Aman Baid Whole Time Director
3 Mrs. AlpanaBaid Non-Executive Director
4 Mr. AnuragPatni Independent Director
5 Mr. MuditSinghi Independent Director
6 Mr. Monu Jain Independent Director

Key Managerial Personnel

Ms. Namrata Sajnani Company Secretary and Compliance Officer of the Company hadresigned and relived from her services with effect from December 31 2020. Consequent toher resignation Mr. Diwakar Jain was appointed as Company Secretary and ComplianceOfficer of the Company with effect from February 08 2021.

The present Key Managerial Personnel of the Company are as follows:

Sl. No. Name of Director Designation
1 Mr. Panna Lal Baid Chairman & Managing Director
2 Mr. Aman Baid Whole Time Director
3 Mr. AdityaBaid Chief Financial Officer
4 Mr. Diwakar Jain Company Secretary & Compliance Officer

10. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each of the Independent Directorsof the Company that they meet the criteria of independence as provided under section149(6) complied with the Code of Conduct as prescribed in the Schedule IV of theCompanies Act 2013as amended and Regulation 16 and 25 of Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 ("ListingRegulations")in respect of their position as an "Independent Director"of Baid Leasing and Finance Co. Ltd.

The independent directors have also confirmed compliance with the provisions of rule 6of Companies (Appointment and Qualification of Directors) Rules 2014 as amendedrelating to inclusion of their name in the databank of independent directors.

The Board took on record the declaration and confirmation submitted by the independentdirectors regarding them meeting the prescribed criteria of independence afterundertaking due assessment of the veracity of the same in terms of the requirements ofregulation 25 of the SEBI Listing Regulations.

11. REMUNERATION POLICY FOR DIRECTORS KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES ANDCRITERIA FOR APPOINTMENT OF DIRECTORS

For the purpose of selection of any Director the Nomination and Remuneration Committeeidentifies persons of integrity who possess relevant expertise experience and leadershipqualities required for the position. The Committee also ensures that the incumbent fulfilssuch criteria with regard to qualifications positive attributes independence age andother criteria as laid down under the Act Listing Regulations or other applicable laws.

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy on appointment and remuneration of Directors Key Managerial Personnel andSenior Managerial Personnel including criteria for determining qualifications positiveattributes independence of a Director and other matters as mandated under Section 178 (3)of the Act and Regulation 19 read with Part D of Schedule II of the Listing Regulations.

The Nomination and Remuneration Policy approved by the Board is available on thewebsite of the Company and the same can be accessed athttps://www.balfc.com/wp-content/uploads/2021/07/Nomiation-and-Remuneration- Policy.pdf

The salient aspects covered in the Nomination and Remuneration Policy have beenoutlined below:

(a) To review the structure size and composition (including the skills knowledge andexperience) of the Board at least annually and making recommendations on any proposedchanges to the Board to complement the Company's corporate strategy with the objective todiversify the Board;

(b) To identify individuals suitably qualified to be appointed as the KMPs or in thesenior management of the Company;

(c) To recommend to the Board on the selection of individuals nominated forDirectorship;

(d) To make recommendations to the Board on the remuneration payable to the Directors /KMPs /Senior Officials so appointed /reappointed;

(e) To assess the independence of independent Directors;

(f) such other key issues/matters as may be referred by the Board or as may benecessary in view of the regulations and provision of the Act and Rules thereunder.

(g) To make recommendations to the Board concerning any matters relating to thecontinuation in office of any Director at any time including the suspension or terminationof service of an Executive Director as an employee of the Company subject to the provisionof the law and their service contract;

(h) To ensure that level and composition of remuneration is reasonable and sufficientrelationship of remuneration to performance is clear and meets appropriate performancebenchmarks;

(i) Performance Evaluation of every Director Key Managerial Personnel and SeniorManagement Personnel.

12. FAMILIARISATION PROGRAMME FOR THE INDEPENDENT DIRECTORS

In compliance with the requirements of Regulation 25(7) of the Listing Regulations theCompany has put in place a Familiarisation Programme for the Independent Directors tofamiliarize them with the Company their roles rights responsibilities in the Companynature of the industry in which the Company operates business model of the Company andrelated matters. The details of number of programmes and number of hours spent by each ofthe Independent Directors during the Financial Year 2020-21 in terms of the requirementsof Listing Regulations are available on the website of the Company www.balfc.com and canbe accessed through the weblink:https://www.balfc.com/wp-content/uploads/2021/07/DETAILS-OF-FAMILIRISATION-PROGRAMMES-IMPARTED-TO-INDEPENDENT-DIRECTORS-DURING-THE-FINANCIAL-YEAR-2020-21..pdf

13. NUMBER OF MEETINGS OF BOARD OF DIRECTORS

Regular meetings of the Board are held to discuss and decide on various businesspolicies strategies and other matters.

During the period under review 5(Five) Board Meetings were held .The requisite quorumwas present for all the Meetings. The intervening gap between the meetings was within theperiod prescribed under the Act Secretarial Standard-1 (SS-1) issued by the Institute ofCompany Secretaries of India and the provisions of listing regulations. Details of themeetings and attendance there at forms part of the "Corporate GovernanceReport".

COMMITTEE OF DIRECTORS

The Company has various Committees which have been constituted as a part of goodcorporate governance practices and the same are in compliance with the requirements of therelevant provisions of applicable laws and statutes. The Board has constituted EightCommittees:

i. Audit Committee

ii. Nomination and Remuneration Committee

iii. Stakeholders' Relationship Committee

iv. Corporate Social Responsibility Committee

v. Risk Management Committee

vi. Asset Liability Management Committee

vii. Executive Committee

viii. Internal Complaints Committee

The abovementioned committees are formed in compliance with the provisions of the Actlisting regulations and other guidelines along with master circulars issued by the RBI.The Company Secretary is the Secretary of all the aforementioned Committees.

The Board of Directors and the Committees also take decisions by Resolutions passedthrough Circulation which are noted by the Board/ respective Committees of the Board attheir next meetings. The Minutes of meeting of all the Committees of the Board arecirculated to the Board of Directors for noting.

The details of Board and Committees including composition and Meetings held during thefinancial year ended on 31st March 2021 and attendance thereto are set out in theCorporate Governance Report enclosed as Annexure I which forms part of this report.

MEETING OF INDEPENDENT DIRECTORS

A separate meeting of Independent Directors was held on July 21 2020 without presenceof Non-Independent Directors and employees of the Company as required under the Act and inCompliance with requirement under Schedule IV of the Act and as per requirements ofListing Regulations and discussed matters specified therein.

14. EVALUATION OF PERFORMANCE OF THE BOARD ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Performance evaluation is becoming increasingly important for Board and Directors andhas benefits for individual Directors Board and the Companies for which they work. TheSecurities and Exchange Board of India has issued a Guidance Note on Board Evaluation andpursuant to the provisions of the act the Board of Directors has carried out an annualperformance evaluation of its own performance Board Committees and individual Directors.

The Chairman of the Company interacted with each Director individually for evaluationof performance of the individual Directors. The evaluation of the performance of the Boardas a whole and individual and of the Committees was conducted by way of questionnaires.

In a separate meeting of Independent Directors performance of Non IndependentDirectors and performance of the Board as a whole was evaluated. Further they alsoevaluated the performance of the Chairman of the Company taking into account the views ofthe Executive Directors and Non-executive Directors.

The performance of the Board was evaluated by the Board after seeking inputs from allthe Directors on the basis of various criteria such as structure and diversity of theBoard competency of Directors experience of Director strategy and performanceevaluation secretarial support evaluation of risk evaluation of performance of themanagement and feedback independence of the management from the Board etc.

The performance of the Committees was evaluated by the Board on the basis of criteriasuch as mandate and composition effectiveness of the committee structure of thecommittee and meetings independence of the committee from the Board and contribution todecisions of the Board.

The Nomination and Remuneration Committee reviewed the performance of the individualDirectors on the basis of the criteria such as qualification experience knowledge andcompetency fulfillment of functions availability and attendance initiative integritycontribution and commitment etc. and the Independent Directors were additionallyevaluated on the basis of independence independent views and judgment etc.

The performance of the Individual Directors was evaluated by the Board on the basis ofcriteria such as ethical standards governance skills professional obligations personalattributes etc.

Further the evaluation of Chairman of the Board in addition to the above criteria forindividual Directors also included evaluation based on effectiveness of leadership andability to steer the meetings impartiality etc.

The Chairman and other members of the Board discussed upon the performance evaluationof every Director of the Company and concluded that they were satisfied with the overallperformance of the Directors individually and that the Directors generally met theirexpectations of performance.

The Board discussed upon the performance evaluation of every Director of the Companyand concluded that they were satisfied with the overall performance of the Directorsindividually and that the Directors generally met their expectations of performance.

The summary of the feedback from the members were thereafter discussed in detail by themembers. The respective Director who was being evaluated did not participate in thediscussion on his/her performance evaluation.

The Directors expressed their satisfaction with the evaluation process.

15. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013 AND INTERNAL COMPLAINT COMMITTEE (ICC)

Your Company has always believed in providing safe and harassment free workplace forevery individual working in its premises through various interventions and practices. TheCompany ensures that the work environment at all its locations is conducive to fair safeand harmonious relations between employees. It strongly believes in upholding the dignityof all its employees irrespective of their gender or seniority. Discrimination andharassment of any type are strictly prohibited.

The Company has a policy for prevention of sexual harassment in line with therequirements of the Sexual Harassment of Women at the Workplace (Prevention Prohibitionand Redressal) Act 2013 (POSH Act). The Company has complied with the provisions relatingto constitution of internal complaints committee (ICC) under the POSH Act. ICC has beenset up to redress complaints received regarding sexual harassment. All employees arecovered under this policy.

The details of the complaints received during the year under review were as follows:

Particulars Nos.
No. of Complaints Pending at the Beginning of the Year 0
No. of Complaints Received and Resolved during the year 0
No. of Complaints Pending at the End of the Year 0

16. AUDITORS & AUDITOR'S REPORT

• Statutory Auditors & Audit Report

Pursuant to the provisions of section 139 of the Act M/s. Khilnani & AssociatesChartered Accountants (Firm Registration No. 005776C) were appointed as the StatutoryAuditors of the Company for a term of five years to hold office from the conclusion ofthe 29th AGM till the conclusion of the 34th AGM.

Pursuant to notification issued by the Ministry of Corporate Affairs on May 07 2018amending Section 139 of the Act the mandatory requirements for ratification ofappointment of auditors by the members at every AGM has been omitted. The members are notrequired to ratify the appointment of the auditors in the AGM held during the year onWednesday September 15 2021.

The Auditors are eligible to continue as Auditors in accordance with the provisions ofSection 141 of the Act. Further M/s. Khilnani & Associates Chartered Accountants havegiven a confirmation to the effect that they are eligible to continue with theirappointment and that they have not been disqualified in any manner from continuing asStatutory Auditors.

The Financial Statements and the Auditor's Report for the financial year ended on 31stMarch 2021are free from any qualification reservation and adverse remark; further thenotes on accounts are self-explanatory. The Auditors' Report is enclosed with thefinancial statements in this annual report.

• Secretarial Auditor & Secretarial Audit Report

As per Section 204 of the Act read with Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 every Listed Company is required to appoint aSecretarial Auditor to carry out Secretarial Audit of the Company.

In consonance with the aforementioned requirement M/s V. M. & Associates CompanySecretaries (Firm Reg. No. P1984RJ039200) were appointed as Secretarial Auditors toconduct the secretarial audit of the Company for the financial year 2020-21.

Secretarial Audit Report as issued by M/s V. M. & Associates Company Secretariesin respect of the secretarial audit of the Company in Form MR-3 for the financial yearended on 31st March 2021 is given in Annexure V to this Report.

In addition to the above and pursuant to SEBI circular dated February 08 2019 areport on secretarial compliance issued by M/s V.M. & Associates for FY 2020-21 hasbeen submitted with the stock exchanges. There are no observations reservations orqualifications in that report. They have stated in the report that the Company hascomplied with the provisions of the Companies Act 2013 rules made thereunderSecretarial Standards SEBI Regulations Guidelines and RBI Master Directions applicableon the Company.

M/s. V.M. & Associates Company Secretaries (Firm Registration No. P1984RJ039200)have confirmed their eligibility and willingness to accept the appointment. The Companyhas received consent/eligibility certificates etc from M/s V.M. & Associates CompanySecretaries. Accordingly Board in its meeting held on June 22 2021 has re-appointed M/sV. M. & Associates Company Secretaries Jaipur as Secretarial Auditor (Firm Reg No.P1984RJ039200) of the Company to carry out secretarial audit of the Company for thefinancial year 2021-22.

• Internal Auditor

Pursuant to Section 138 of Act read with Companies (Audit and Auditors) Rules 2014every Listed Company is required to appoint an Internal Auditor or a firm of InternalAuditors to carry out Internal Audit of the Company.

In consonance with the aforementioned requirements M/s. Shiv Shankar Khandelwal&Co. (Firm Registration No. 006852C) Chartered Accountants were appointed as InternalAuditors to conduct the Internal Audit of the Company for the financial year 2020-21.

The Internal Audit Report is received yearly by the Company and the same is reviewedand taken on record by the Audit Committee and Board of Directors. The yearly InternalAudit Report as received for the financial Year 2020- 21is free from any qualification.

M/s. Shiv Shankar Khandelwal& Co. Chartered Accountants (Firm Registration No.006852C) have confirmed their eligibility and willingness to accept the appointment. TheCompany has received consent/eligibility certificates etc. from M/s. Shiv ShankarKhandelwal& Co. Chartered Accountants. Accordingly Board in its meeting held on June22 2021 has re-appointed M/s Shiv Shankar Khandelwal& Co. Chartered AccountantsJaipur (Firm Reg. No. 006852C)as the Internal Auditor of the Company for the financialyear2021-22.

• Cost Audit

The provisions of Section 148 of the Companies Act 2013 and the Companies (CostRecords and Audit) Rules 2014 are not applicable to the Company. Hence the maintenanceof the cost records as specified by the Central Government under Section 148(1) of theCompanies Act 2013 is not required and accordingly such accounts and records are notmade and maintained. The Company has not appointed any Cost Auditor during the year.

• REPORTING OF FRAUDS BY AUDITORS

During the year under review neither the Statutory Auditor nor the Secretarial Auditorhas reported to the Audit committee under Section 143 (12) of the Act any instances offraud committed against the Company by its officers or employees.

17. PARTICULARS OFLOANS GUARANTEES AND INVESTMENTS IN SECURITIES BY THE COMPANY

Pursuant to Section 186(11) of the Act read with Rule 11(2) of the Companies (Meetingsof Board and its Powers) Rules 2014 the loans made guarantees given or securitiesprovided or acquisition of securities by a Non-Banking Financial Company (NBFC) registeredwith RBI in the ordinary course of its business are exempted from the applicability ofProvisions of Section 186 of the Act. As such the particulars of loans and guarantee havenot been disclosed in this Report. However the same are mentioned in the Note no. 3 and 4in audited financial statements for the financial year ended on March 31 2021.

18. RELATED PARTY TRANSACTIONS

During the year all the related party transactions were in accordance with Section 188of the Act Regulation 23 of Listing Regulations and IND AS-24 and are disclosed underNote No. 3.10 of the Notes to Standalone Financial Statements for the year ended March 312021. The transactions were in the ordinary course of business and on arm's length basisand there were no transactions requiring approval of the Shareholders.

However prior omnibus approval is obtained for related party transactions underSection 188 (1) of the Act which are of repetitive nature and entered in the ordinarycourse of business and at arm's length. All related party transactions are placed beforethe Audit Committee for review and approval.

Further there are no materially significant related party transactions during the yearunder review made by the Company with Promoters Directors Key Managerial Personnel orother designated persons which may have a potential conflict with the interest of theCompany at large. Thus disclosure in Form AOC-2 is not required.

The Company has adopted a policy on materiality of related party transactions indealing with Related Party Transactions and the same is disclosed on the website of theCompany and can be accessed athttps://www.balfc.com/wp-content/uploads/2021/07/Policy-on-Related-Party-Transactions-Materiality.pdf

19. RISK MANAGEMENT

Risk Management is an integral part of the Company's business strategy with focus onbuilding risk management culture across the organization. The Company has developed andimplemented a risk management policy which encompasses practices relating toidentification assessment monitoring and mitigation of various risks to key businessobjectives. The Risk management framework of the Company seeks to minimize adverse impactof risks on our key business objectives and enables the Company to leverage marketopportunities effectively.

The various key risks to key business objectives are as follows:

Liquidity Risk: It is the risk that the Company will be unable to meet its financialcommitment to a Bank/ Financial Institution in any location any currency at any point intime. Liquidity risk can manifest in three different dimensions for the Company.

Funding Risk: To replace net outflows due to unanticipated outflows.

Time Risk: To compensate for non-receipt of expected inflows of funds.

Call Risk:

Due to crystallization of contingent liabilities or inability to undertake profitablebusiness opportunities when desirable.

Interest Rate Risk: It is the risk where changes in market interest rates mightadversely affect the Company's financial condition. The short term/immediate impact ofchanges in interest rates are on the Company's Net Interest Income (NII). On a longerterm changes in interest rates impact the cash flows on the assets liabilities andoff-balance sheet items giving rise to a risk to the net worth of the Company arising outof all re-pricing mismatches and other interest rate sensitive positions.

The Company's Risk Management Policy is put up on the Company's website and can beaccessed at https://www.balfc.com/wp-content/uploads/2021/07/Risk-Management-Policy.pdf

20. INTERNAL FINANCIAL CONTROL SYSTEMS

The Company believes that internal control is a necessary prerequisite of Governanceand that freedom should be exercised within a framework of checks and balances. TheCompany has a well-established internal control framework which is designed tocontinuously assess the adequacy effectiveness and efficiency of financial andoperational controls.

The management is committed to ensure an effective internal control environmentcommensurate with the size scale and complexity of the business which provides anassurance on compliance with internal policies applicable laws regulations andprotection of resources and assets. The control system ensures that the Company's assetsare safeguarded and protected and also takes care to see that revenue leakages and lossesto the Company are prevented and our income streams are protected. The control systemenables reliable financial reporting. The Audit Committee reviews adherence to internalcontrol systems and internal audit reports.

The Company has received report on Internal Financial Controls from statutory auditorsof the company.

21. DETAILS RELATING TO DEPOSITS

The Company has not accepted any deposit within the meaning of the Companies(Acceptance of Deposits) Rules 2014 or Chapter V of the Act and guidelines and directionsof Non-Banking Financial Companies (Acceptance of Public Deposits)(Reserve Bank)Directions 2016 as prescribed by RBI in this regard and as such no details are requiredto be furnished.

Further the Company has taken unsecured loans from the Directors of the Companydetails of the same are part of notes on accounts in the Annual Report. Please refer NoteNo. 3.10 of the Notes to Standalone Financial Statements for the year ended March 31 2021

22. MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management's Discussion and Analysis Report for the year under review pursuant toRegulation 34 of Listing Regulations is annexed herewith as Annexure VI formingpart of the Annual Report.

23. CORPORATE GOVERNANCE REPORT

Your Company practices a culture that is built on core values and ethical governancepractices. The Company is committed to maintain the highest standards of CorporateGovernance and adhere to the Corporate Governance requirements set out by the Securitiesand Exchange Board of India ("SEBI"). The Company has also implemented severalbest governance practices. The report on Corporate Governance for the financial year endedon March 31 2021 along with Certificate issued by the M/s V.M. & Associates CompanySecretaries confirming the compliance to applicable requirements related to corporategovernance as stipulated under Schedule V of the Listing Regulations forms part of thisAnnual Report as Annexure I.

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

24. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGOParticulars with respect of conservation of energy technology absorption foreignexchange earnings and outgo:

The information required under Section 134(3) (m) of the Act read with the Companies(Accounts) Rules 2014 relating to the conservation of energy and technology absorptionforeign exchange earnings and outgo are given below:

(a) Conservation of energy:

I the steps taken or impact on conservation of energy • The operations of the Company being Financial Services related require normal consumption of electricity. However the Company is making necessary efforts to reduce the consumption of energy.
• The office of the Company has been using LED bulbs that consume less electricity as compared to CFL and incandescent bulbs. The Company has increased the usage of low electricity consuming monitors in place of conventional monitors. The Company has started buying the new energy efficient computers that automatically goes into low power 'sleep' mode or off- mode when not in use. As a part of Green Initiative a lot of paper work at Registered Office has been reduced by increased usage of technology.
II the steps taken by the Company for utilizing alternate sources of energy The Company has installed a solar panel at its registered office which produces energy and provides power to the equipments of complete office.
III the capital investment on energy conservation equipment In view of the nature of activities carried on by the Company there is no capital investment on energy conservation equipment except installed solar panel at its registered office.

(b) Technology absorption:

I the efforts made towards technology absorption Your Company being a Non-Banking Finance Company its activities do not require adoption of any specific technology. However your Company has been in the forefront in implementing latest information technologies & tools towards enhancing our customer convenience and continues to adopt and use the latest technologies to improve the productivity and quality of its services. The Company's operations do not require significant import of technology.
II The benefits derived like product improvement cost reduction product development or import substitution N.A.
III Technology Imported during the last three years
(a) The details of technology imported N.A.
(b) The year of import N.A.
(c) Whether the technology been fully absorbed N.A.
(d) If not fully absorbed areas where absorption has not taken place and the reasons thereof N.A.
IV The expenditure incurred on Research and Development Company has not incurred any expenditure on research and development during the year under review.

(c) Foreign exchange earnings and Outgo:

Foreign exchange earnings and outgo is reported to be NIL during the financialyear under review.

25. CORPORATE SOCIAL RESPONSIBILITY

In compliance with the requirements of Section 135 of the Act read with the Companies(Corporate Social Responsibility Policy) Rules 2014 the Board of Directors haveconstituted a Corporate Social Responsibility (CSR) Committee. The details of membershipof the Committee and the meetings held are detailed in the Corporate Governance Reportforming part of this Report.

Ministry of Corporate Affairs has amended the provisions of Section 135 and rules madethereunder as If the company spends an amount in excess of the requirements then may setoff such excess amount during succeeding financial years after passing Board Resolutionand any short fall in spending the CSR amount unless such amount relates to any outgoingproject then such amount needs to be transfer to the fund specified in the Schedule VII ofthe Act within six months from the end of Financial Year.

Also Company is required to take certificate from Chief Financial officer of theCompany certifying that funds so disbursed have been utilized for the purposes and in themanner as approved in accordance with the Rule 4 of the Companies (Corporate SocialResponsibility Policy) Rules 2014. In compliance with the same company has receivedcertificate from Mr. Aditya Baid Chief Financial Officer of the Company certifying thatfunds so disbursed are utilized for the purposes and in the manner as approved by theBoard of Directors.

The Company was obligated to spend approximately an amount of:

(i) Rs. 2089673/- (Rupees Twenty Lakhs Eighty Nine Thousands Six Hundred SeventyThree Only) being 2% of the average net profit before tax of the three immediatelypreceding financial years towards CSR activities during the financial year2020-2021: and

(ii) Rs. 1445895/-[Rupees Fourteen Lakhs Forty Five Thousand Eight Hundred NinetyFive Only]Unspent budget of previous Financial Year due to unavailability of suitable CSRactivity.

Company has contributed a sum of. Rs. 3591200/- (Rupees Thirty Five Lakhs Ninety OneThousands Two Hundreds Only) towards CSR activities for the Financial year 2020-21(including Rs. 1445895/-[Rupees Fourteen Lakhs Forty Five Thousand Eight Hundred NinetyFive Only] which was excessive by Rs. 55632/- against its actual CSR Obligation for theFY 2020-21.

Ministry of Corporate Affairs has amended the format of an annual report on CorporateSocial Responsibility activities to be included in the Board's Report for the FinancialYear commencing on or after 1st day of April 2020. The the Annual Report on CSRactivities pursuant to the provisions of Section 135 of the Companies Act 2013 read withRule 8 of the Companies (Corporate Social Responsibility Policy)Rules 2014 as amended isannexed herewith as Annexure II to this report.

The CSR Policy approved by the Board is available on the website of the Company thesame can be accessed athttps://www.balfc.com/wp-content/uploads/2021/07/Corporate-Social-Responsibility-policy.pdf

26. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

There were no significant and material orders passed by the Regulators or Courts orTribunals during the year impacting the going concern status and the operations of theCompany in future pursuant to Rule 8 (5) (vii) of the Companies (Accounts) Rules 2014.

27. VIGIL MECHANISM

In line with the provisions of Listing Regulations the Act and the principles of goodgovernance the Company has devised and implemented a vigil mechanism in the form of'Whistle-Blower Policy'. Detailed information on the Vigil Mechanism of the Company isprovided in the Report on the Corporate Governance which forms part of the Annual Report.

28. EXTERNALRATINGS

Previously Company was assigned credit rating of BBB by Brickwork Ratings thereafterBrickwork Ratings vide its letter dated September 28 2020 has assigned the credit ratingto the Company in respect of bank facilities as given below:

Facility Rating Agency Rating Outlook
Fund Based Brickwork Ratings BBB Stable

29. DISCLOSURE ON SECRETARIAL STANDARDS:

During the period under review applicable Secretarial Standards i.e. SS-1 andSS-2relating to 'Meetings of the Board of Directors' and 'General Meetings' respectivelyissued by The Institute of Company Secretaries of India have been duly followed by theCompany and have devised proper systems to ensure compliance with the provisions of allapplicable Secretarial Standards and that such systems are adequate and operatingeffectively.

30. RBI COMPLIANCES

Your Company is a Non-Banking Non Deposit Taking Non Systemically Important Investmentand credit Company ("NBFC-ICC") your Company continues to comply withthe applicable regulations and guidelines of Reserve Bank of India and provisions asprescribed in Master Direction-Non-Banking Financial Company-Non Systemically ImportantNon-Deposit taking Company (Reserve Bank) Directions 2016 ("Master Directions")as amended from time to time.

Further your Company has complied with all the rules and procedure as prescribed inabove mentioned master directions and any other circulars & notifications time totime issued by Reserve Bank of India.

31. PARTICULARS OF REMUNERATION OF DIRECTORS KMPs AND EMPLOYEES

(A) During the year under review none of the Director/KMP/employee of the Company wasin receipt of the remuneration exceeding the limits prescribed u/s 197 (12) read with rule5 sub-rule 2 of The Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 of the Act. A Statement giving the details is annexed herewith as AnnexureIII to this report.

(B) The ratio of the remuneration of each Director to the median employee'sremuneration and other details in terms of sub-section 12 of Section 197 of the Act readwith Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are forming part of this report as Annexure IV.

32. CHAIRMAN AND CFO CERTIFICATE

The Chairman and Managing Director and the Chief Financial Officer of the Company giveannual certification on financial reporting and internal controls to the Board in terms ofRegulation 17(8) of the Listing Regulations. The Chairman and Managing Director and theChief Financial Officer also give quarterly certification on financial results whileplacing the financial results before the Board in terms of Regulation 33(2) of ListingRegulations. The annual certificate given by the Chairman and Managing Director and theChief Financial Officer is published in this Report.

33. COMPLIANCE WITH THE CODE OF CONDUCT AND ETHICS

In compliance with the Listing Regulations and Act the Company has framed and adopteda code of conduct and ethics ("the code"). The code is applicable to the membersof the Board the executive officers and all the employees of the Company.

All the members of the Board and Senior Management Personnel have affirmed complianceto the code for the financial year ended on March 31 2021 and a declaration to thiseffect signed by the Managing Director forms part of the Corporate Governance Report as AnnexureI.

34. DISCLOSURE OF ACCOUNTING TREATMENT

The Financial Statement of the Company for FY 2020-21have been prepared with theapplicable accounting principles in India and the mandatory Indian Accounting Standard('Ind-AS') as prescribed under Section 133 of the Act read with the rules made thereunder.

35. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to sub section 3 (c) of Section 134 of the Act the Board of Directors of theCompany hereby state and confirm that:

i. in the preparation of the annual accounts for the year ended on March 31 2021 theapplicable accounting standards have been followed and there are no material departuresfrom the same;

ii. the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the Financial Year ended onMarch 31 2021and of the profit and loss of the Company for that period;

iii. the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the Directors have prepared the annual accounts on a going concern basis;

v. the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

vi. the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

36. OTHER DISCLOSURES

Other disclosures with respect to Board's Report as required under the Act Rulesnotified thereunder and Listing Regulations are either NIL or NOT APPLICABLE.

37. ACKNOWLEDGEMENTS

Your Board acknowledges with appreciation the invaluable support provided by theReserve Bank of India Securities and Exchange Board of India Ministry of CorporateAffairs Central Registry of Securitisation Asset Reconstruction and Security Interest ofIndia Bankers &Lenders Company's shareholders auditors advisors businesspartners all its customers for the patronage received from them including officials thereat from time to time. The Board would also like to thank the BSE Limited NationalSecurities Depository Limited Central Depository Services (India) Limited MCS Registrarand Share transfer Agent (Registrar and Share Transfer Agent) and the Credit RatingAgency(ies) for their continued co-operation.

Your Board records with sincere appreciation the valuable contribution made byemployees at all levels and looks forward to their continued commitment to achieve furthergrowth and take up more challenges that the Company has set for the future.

Date: June 22 2021 For and on behalf of The Board
Place: Jaipur For Baid Leasing and Finance Co. Ltd.
Registered. Office: "Baid House" IInd Floor 1
Tara Nagar Ajmer Road Jaipur-302006
Sd/-
Panna LaL Baid
Chairman and Managing Director
DIN:00009897

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