1. Corporate Information

Intec Capital Limited (‘the Company’) incorporated in India on February 15, 1994, was registered with

the Reserve Bank of India (‘RBI’) as a Non-Banking Financial Company (‘NBFC’) vide Certificate No.

B-14.00731dated May4, 1998 in the name of Intec Securities Limited. Subsequently, due to change in

name of the Company, the Company received a revised Certificate of Registration (‘CoR’) in the name

of Intec Capital Limited on November 4, 2009 under Section 45-1A of the Reserve Bank of India Act,

1934. It is a Systemically Important Non-Deposit taking Non-Banking Financial Company (NBFC-ND-SI).

The Company is primarily engaged in the business of providing machinery loans to Small and Medium Enterprises (‘SME’) customers.

2.1 Rights, preferences and restrictions attached to each class of shares

The Company has only one class of Equity Share having par value of Rs. 10 per share. Each shareholder is eligible for one vote per share held. All Equity Shares are entitled to receive dividend as declared from time to time. The voting rights cannot be exercised in respect of shares on which any call or other sums presently payable have not been paid. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company in proportion of their shareholding.

3.1 As per Section 45-IC of the Reserve Bank of India Act, 1934 (‘RBI Act’), every NBFC is required to transfer a sum not less than twenty percent of its net profit for the year to the ‘Statutory Reserve as per Section 45-IC of RBI Act’. As during the year there is no profit, there is no transfer to the said reserve, (previous year Rs. 7.26 lakhs being 20% of the net profit was transfered to the said reserve).

- repayable on equitable monthly and quarterly installments

## repayable at the time of maturity along with interest accrued

4.1 Loans also guaranteed by directors and other parties

- loans of Rs. 6,119.99 lakhs secured by personal guarantee of managing director and lien on Fixed deposits of Rs. 89.67 lakhs

- loan of Rs. 83.33 lakhs secured by personal guarantees of managing director and relative of managing director and corporate guarantee of Bubble Infosolutions Private Limited (company in which managing director of the Company is a director)

- loan of Rs. 663.70 lakhs secured by personal guarantee of managing director and corporate guarantee of Bubble Infosolutions Private Limited (company in which managing director of the Company is a director) and Amulet Technologies Limited (Subsidiary of the Company)

4.1 Rate of interest (range):

4.1.1 Interest rates on above secured loans range between 11.25%- 13.55% per annum

4.1.2 Interest rates on above unsecured loans range between 7%- 8.37% per annum

- repayable on equitable monthly and quarterly installments

## repayable at the time of maturity along with interest accured

4.3 Loans also guaranteed by directors and other parties

- loan of Rs. 12,641.34 lakhs secured by personal guarantee of managing director and lien on Fixed deposits of Rs. 48.24 lakhs

- loan of Rs. 333.33 lakhs secured by personal guarantees of managing director and relative of managing director and corporate guarantee of Bubble Infosolutions Private Limited (company in which managing director of the Company is a director)

- loan of Rs. 1,495.69 lakhs secured by personal guarantee of managing director and corporate guarantee of Bubble Infosolutions Private Limited (company in which managing director of the Company is a director) and Amulet Technologies Limited (Subsidiary of the Company)

4.4 Rate of interest :

4.4.1 Interest rates on above secured loans range between 11.45%- 12.30% per annum

4.4.2 Interest rates on above unsecured loans range between 7%- 8.37% per annum

5.1 Working Capital loans from banks are secured by :

(a) Primary Security- first pari passu charge on present and future receivables of the Company

(b) Collateral Security-Fixed deposits of Rs. 1098.44 lakhs (previous year : Rs. 1,337.51 lakhs) lien marked to banks and Immovable properties belonging to promoter & others

(c) Personal guarantees of managing director and relative of managing director

(d) Corporate guarantee of Bubble Infosolutions Private Limited (company in which managing director of the Company is a director and Amulet Technologies Limited Subsidary of the Company)

5.2 Interest rates on above loans range between 10.60% - 13.55% per annum (previous year : 10.60% -13.45% per annum).

6.1 Other liabilities comprise of payables towards miscellaneuos and expenses etc.

6.2 There is no amount due and outstanding to be credited to Investor Education & Protection Fund.

6.3 There is no amount outstanding to suppliers under Micro, Small and Medium Enterprises Development Act, 2006 based on available information with the Company.

7.1 Secured by hypothecation of specific assets

7.2 The Company makes provision for standard and non-performing assets (sub-standard and doubtful assets) in accordance with the Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016. Further, in accordance with these Directions, the Company has separately shown the said provision under Short Term and Long term Provisions (as applicable) without netting off from loans.

8.1 Subject to first charge as security against the working capital facilities availed from the Banks.

9.1 Fixed deposits of Rs. 726.60 lakhs (Previous year: Rs. 1,055.12 lakhs) are subject to first charge as security against the working capital facilities, of Rs. 89.67 lakhs (Previous year: Rs. 48.24 lakhs) are subject to first charge as security against the Term Loan facilities and of Rs. 31.05 lakhs (Previous year: Rs. 60.53 lakhs) are liened with Small Industries Development Bank of India under Credit Delivery Arrangement.

10. Contingent liabilities

(a) Few customers / borrowers of the Company have filed legal cases for various claims against the Company. The management has reviewed these pending litigations and proceedings and does not expect any material outflow / reimbursement.

(b) Corporate Guarantee

Issued to Small Industries Development Bank of India under Credit Delivery Arrangement: Rs. 48.08 lakhs

11. Commitment

Loan approved but pending disbursement: Rs 38.54 Lakhs (Previous Year: Rs. 54.44 Lakhs).

12. Corporate Social Responsibility (CSR):

The Company has constituted a CSR committee as required under Section 135 of the Companies Act, 2013, together with relevant rules as prescribed in Companies (Corporate Social Responsibility Policy) Rules, 2014 (‘CSR rules’).The CSR Committee had approved the CSR Policy and also identified the broad areas of CSR activities which it propose to carry out viz. Child Education and Women Empowerment. During the year, the Company made serious deliberations and choose the CSR programs which would be undertaken on a long term and continuous basis. Such programs will benefit communities where the Company operates or likely to operate and create goodwill for the Company. The detail of the amount spent during the period is as under:

13. Accounting Standards Disclosures

13.1 Accounting Standard 15 (Revised) - Employee Benefits

(a) Defined Benefit plans:

Gratuity : Payable on separation as per the Payment of Gratuity Act, 1972 as amended @ 15 days pay, for each completed year of service to eligible employees who render continuous service of 5 years or more. The Company’s liability towards Gratuity is funded / managed by a trust, which invests the funds with Life Insurance Corporation of India (LIC).

(b) Other Long Term Benefit:

Compensated Absences : Employees of the Company are entitled to accumulate their earned/privilege leave up to a maximum of 30 days which can be availed / utilized in coming year/s, while in service. During the year the amount of Rs. 9.42 lakhs (previous year : Rs. 5.46 lakhs) has been credited in the Statement of Profit and Loss towards reversal of the excess provisions based on actuarial valuation.

(c) Defined Contribution plan:

Company’s employees are covered by Provident Fund and Employees State Insurance Scheme/Fund, to which the Company makes a defined contribution measured as a fixed percentage of salary. During the year, amount of Rs. 29.33 lakhs (Previous Year: Rs. 47.14 lakhs) has been charged to the Statement of Profit and Loss towards employer’s contribution to these schemes/funds as under:

Investment details of the plan assets

100% of the plan assets are maintained with the LIC Managed funds, and in the absence of the complete details from LIC, the requisite detail of funds are not furnished.

Actuarial Assumptions:

The principal assumptions are the discount rate and salary increase. The discount rate is based upon the market yields available on Government bonds at the accounting date with a term that matches that of the Liabilities and the salary increase takes account of inflation, seniority, promotion and other relevant factors on long term basis. Principal assumptions used for actuarial valuation are:

13.2 Accounting Standard 17 - Segment Reporting:

The Company is primarily engaged only in the business of providing loans to Small and Medium Enterprises (‘SME’) customers and has no overseas operations/units and as such, no segment reporting is required under Accounting Standard 17 - Segment Reporting.

13.3 Accounting Standard 18 - Related Parties A. List of Related Parties and relationships, having transactions during the year

a) Subsidiary Company

Amulet Technologies Limited

b) Key Management Personnel

Sanjeev Goel, Managing Director

c) Relative of Key Management personal

Pranav Goel, Son of Sanjeev Goel, Managing Director

Ritika Goel, Wife of Sanjeev Goel, Managing Director, and Director (upto November 08, 2017)

d) Enterprises over which key Management Personnel exercises significant influence

Bubble Info Solutions Private Limited

e) Enterprises over which relative of key management exercises significant influence

Intec Infonet Private Limited

f) Investing party in respect of which the reporting enterprise is an associate

Pantec Devices Private Limited

Note: Related party relationship is as identified by the Company and relied upon by the Auditors.

13.1 Accounting Standard 19 - Operating Leases

The Company’s significant leasing arrangements are in respect of operating leases for premises (commercial premises, offices etc.). The leasing arrangements include non-cancellable leases ranging from 0-1 year and are usually renewable by mutual consent on mutually terms. There are no sub leases.

The aggregate lease rentals payable are charged to Statement of Profit and Loss.

14. Disclosures required as per Reserve Bank of India ‘Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016’, to the extent as applicable to the Company.

Notes: l.The Sector wise NPA detail has been given for the sector/category, based on the categorization and the required information available in the loan records maintained by the Company.

2. For calculating above percentages, restructured assets which are less than 90 days overdue and not recognized as NPA (as per RBI guidelines), have been included as they are reported under Substandard assets.

Note:-NPA includes restructuring amounting to Rs 434.46 lakhs (Previous year Rs. 521.88 lakhs) and provision thereon Rs. 130.34 lakhs (Previous year Rs. 156.56 lakhs).

14.1 Customer Complaints

(a) No. of complaints pending at the beginning of the year 01

(b) No. of complaints received during the year 07

(c) No. of complaints redressed during the year 08

(d) No. of complaints pending at the end of the year 00

15.1 Miscellaneous

(i) Details of Single Borrower Limit (SBL) / Group Borrower Limit (GBL) exceeded

During the year, the Company has not exceeded SBL & GBL limits as prescribed under NBFC Regulation.

(ii) The Company does not deal with advances for which intangible securities such as charge over the rights, licence ,authority etc. have been taken.

(iii) Registration obtained from other financial sector regulators

The Company has not obtained any registration from any other financial sector regulators.

(iv) Disclosure of Penalties imposed by RBI and other regulators

No penalty has been imposed by the RBI or any other regulator during the year.

(vii) The following disclosures are not required / applicable, as no such transaction / activity was conducted by the Company during the year.

(a) Long-term contracts including derivative contracts, for which there were any material foreseeable losses.

(b) Securitization/Reconstruction / Assignments deal.

(c) Sale / Purchase of financial assets to Securitization / Reconstruction Company for Assets Reconstruction.

(d) Hedged foreign currency exposure, Forward Rate Agreement / Interest Rate Swap.

(viii) Schedule to the Balance Sheet of a Non-Deposit taking Non-Banking Financial Company, as required in terms of paragraph 13 of Non-Banking Financial (Non Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007) : Refer Annexure - 1

16.1 Figures for previous year have been regrouped and/or reclassified wherever considered necessary, to conform to current year’s classification.