To,

The Members,

Your Directors are pleased to present the 39^th Annual Report of Popular Vehicles and Services Limited, together with the report of the Statutory Auditors and the Audited Financial Statements for the financial year ended 31^st March, 2023.

Terming the prevalent global environment to be on the path of a "Rocky Recovery”, IMF's World Economic Outlook (WEO) of April 2023 has assessed the global economy to grow by 2.8% in 2023, down from 3.4% in the prior year, before settling at 3% in 2024.

The IMF has attributed a number of factors that will impede global economic recovery, such as unprecedented inflation that has elevated commodity costs and triggered a cost-of- living crisis in many parts of the world. Further, the lingering COVID impacts, geopolitical situation such as the war in Ukraine, and tightening policy by most major central banks of the world has created conditions that point to a rocky path ahead.

India however has seemed to escape the global economic challenges, with the first provisional estimates of the National Statistical Office pegging GDP growth at 7.2% for 2022-23. This was buttressed by the 6.1% GDP growth registered in the last quarter of FY2022-23, with expansion in manufacturing and construction being the primary drivers of growth. This reflects sustained strength in domestic demand even amid a gloomy global economic outlook. The Indian economy is expected to grow by 6.5-7% in the current fiscal year too on the back of strong policy reforms by the government, increased public sector spending, and relatively strong domestic demand.

The Indian automobile industry, a proxy of the broader economy, accomplished a strong performance in 202223. As per the Society of Indian Automobile Manufacturers (SIAM), total passenger vehicles (PVs) posted their highest- ever domestic sales during the year at 3.89 million units, growing at a 3.6% CAGR to surpass the previous (prepandemic) peak of 3.37 million units in 2018-19. PV sales in 2021-22 stood at 3.06 million units. Within the PV basket, utility vehicles sales increased from 1.48 million units in 202122 to 2 million in 2022-23.

A number of factors converged to drive domestic PV sales, including post-COVID pent-up demand, rise in preference for SUVs, new product launches, and imminent vehicle price increase due to more stringent emission norms, elevated input costs, etc. Despite the supply chain challenges spawning from the Russia-Ukraine crisis, the industry did well to ensure operational efficiency to service demand and meet customer expectations.

There were other challenges too, including an acute semiconductor shortage that impacted production and delivery schedules and created a huge backlog. All in all however, the domestic PV industry did well during the year in review.

The domestic commercial vehicle (CV) market largely stabilised during the year, with offtake impetus emanating from increased trade and commerce and accelerated interstate movement of cargo. Expansion plans of fleet owners in the wake of economic recovery also contributed to CV demand. Total CV sales enhanced to 0.96 million vehicles in 2022-23, up from 0.71 million vehicles in the prior year. However, CV sales are short of the 1 million mark achieved in the pre-pandemic year of 2018-19, and the current year will likely see CV sales surpass the pre-pandemic year sales.

Going forward, while a low base over the last three fiscal years will tend to accentuate comparative automotive sales growth in the current year, improvement in supply chain and consumer sentiment will be contributing factors too. On the flip side, rising vehicle costs driven by BS VI Phase-2 emission norms and high fuel costs and insurance premiums do pose a concern as well.

Within the overall context of its operating environment, PVSL accomplished a satisfactory performance during the financial year 2022-23.

As amongst the top dealership of Maruti Suzuki India Limited (MSIL) vehicles in India, your Company achieved sales of 30,948 MSIL vehicles during the year under report, up from 26,142 vehicles in the previous year, registering a 18.38% YoY growth. This exhibits a sales growth trend that is ahead of MSIL's overall pan-India sales growth of 23% YoY. Though the OEM, which is India's largest PV manufacturer with the highest market share, faced shortage of electronic components that impacted production, it still registered its highest ever total sales in 2022-23. MSIL is joining the SUV growth opportunity with a bang with the launch of the Grand Vitara/Fronx/Jimmy and some more models and will

increase its market share in the segment, thus leading to a 3-4% increase in overall market share with NEXA models leading the surge.

The Group registered sound performance in non-MSIL sales too, with satisfactory growth achieved in PV sales of our other OEM principals, such as Honda and JLR. Further, the Group also remained amongst the top CV dealers of Tata Motors and also made good inroads with CVs of Bharat Benz.

In keeping with the future trend, the Group has moved into the e-mobility segment with dealership of Ather and Piaggio, OEMs that are early entrants in the electric segment. We believe we will be able to create a new engine of growth by venturing into this category, with vehicle electrification clearly the future.

As electric vehicle (EV) adoption expands in India, e-2W sales volume in the country is likely to touch 22 million units by 2030. The e-2W market is expected to be over 80% of the overall 2W market by 2030, as per Redseer, a strategy consulting firm. With demand for affordable transportation and focus shifting to reducing carbon emissions, EVs will play a vital role in India's step towards a cleaner and more sustainable future.

The Company is deeply aware of the importance of business integration with meeting the needs of society. One of the ways we do so is through local employment at our dealership and services operations that typically require large manpower.

We help our people develop their skills through structured training programs imparted at our own educational setup. A major step the Kuttukaran Group took in this regard comprises the establishment of Kuttukaran Polytechnic College at Manakkapady in Ernakulam, which also comprises a significant diversification in our community educational endeavours.

We also provide need-based support to communities, ensuring we lend a helping hand during their times of need. The major focus areas of our social actions comprise education, healthcare and women empowerment. For instance, the Company contributed to the installation of sanitary napkin burners and water filters in women hostels. There were various seminars, workshops, medical camps, self-defence training classes and skill training classes organized for underprivileged women too as part of our social outreach efforts.

We believe that credible external endorsements are a motivating factor in our journey of accomplishing excellence. Continuing with its trailblazing path, the Group was bestowed with a number of awards and accolades in 2022-23. Our Company received the ET Auto Award Top Dealers of the Year 2023 (South).

Vehicle ownership in India is merely 7.5% of overall households in India. Except for only very few states, the penetration in most others is in single digits, including Tamil Nadu at about 6.5%, Karnataka at 9.1%, and Maharashtra at 8.7%. This comprises a key rationale for the Group to venture into these states with its existing OEM dealership to tap into the opportunity presented by these states that are witnessing transformation in per capita income and greater affordability and affluence. This trend is further testified by the growing popularity of SUVs in the country, especially lifestyle SUVs in the premium segment.

We will continue to build on our foundations in customer excellence to drive sales for our OEMs, especially as they launch new models such as MSIL's Jimny and Fronx and Honda's Elevate. Deepening retail engagement will also enable us to expand ancillary income channels, such as sales of accessories and insurance, vehicle spares, maintenance and body work, etc.

Further, we will also continue to build our footprint in preowned vehicles of MSIL and other OEMs that will help us transform our margin profile and add stability to the overall business. It will also help us tap into the growing demand for pre-owned vehicles in the country, thus enabling us to serve a wide spectrum of consumers across income brackets and expectations.

We will also seek to adopt digital technologies that enable us to enhance the experience of our customers across their engagement cycle with us, right from test drives to documentation to acquisition of their preferred vehicle. In this, we are also creating learning and training setup for our employees to enable them to serve our customers in the best possible way as well as to ensure their own career growth and advancement.

Looking ahead, some challenges persist, such as constraints in supply chain of semiconductors that will continue to elongate waiting periods against high demand. Further, higher inflation-driven input costs and other regulatory costs will push up the cost of the overall vehicle for the consumer. We will continue to redefine our value proposition with a view to ensure excellence in customer service standards, meeting their demanding expectations. We will also continue to differentiate ourselves in the paradigm of customer service and ensure we remain amongst the top automotive dealership for our OEMs.

Key highlights of the financial performance of your Company on standalone and consolidated basis for the financial year 2022-23 is provided below:

On a standalone basis, our sales were at Rs. 25,135.66 million for the current year as against Rs. 18,655.31 million in the previous year, registering an increase of 34.74%. We achieved profit before tax of Rs. 390.05 million in the year in review, against profit before tax of Rs. 13718 million in the prior year, recording an increase of 184.34%.

(In INR million, except earnings per share data)

On a consolidated basis, our sales increased to Rs 48,750.02 million for the current year, as against Rs. 34,658.79 million in the previous year, recording an increase of around 40.66%. Our profit before tax increased to Rs.848.67 million for the current year as against Rs 485.46 million in the previous year, recording a hike of around 74.82%.

(In INR million, except earnings per share data)

The standalone and consolidated financial statements for the financial year ended 31^st March, 2023, forming part of this Annual Report, have been prepared in accordance with the Indian Accounting Standards (IndAS), as notified by the Ministry of Corporate Affairs.

During the financial year under report, there was no change in the authorised and paid-up equity share capital of the Company.

As on 31^st March, 2023, the authorised share capital of your Company stood at Rs.15,00,00,000/- comprising 1,50,00,000 equity shares of face value of Rs.10/- each. Paid-up equity share capital of your Company stood at Rs. 12,54,42,890/- consisting of 12,544,289 equity shares of Rs. 10/- each fully paid up.

The Company has taken necessary action to facilitate dematerialisation of all its existing securities and issue its further securities only in dematerialised form vide Companies (Prospectus and Allotment of Securities) Third Amendment Rules, 2018, dated September 10, 2018 and Rule 9A which came into effect from October 02, 2018 onwards.

As on 31^st March 2023, a total of 12,526,027 equity shares, representing 99.85% of the equity share capital, have been dematerialized and 18,262 equity shares (0.15%) are held in physical form.

The Board of Directors of your Company, after considering holistically the relevant circumstances and keeping in view the Company's dividend distribution policy, has decided that it would be prudent not to recommend any dividend for the year under review.

No amount is proposed to be transferred to general reserves for the financial year ended 31^st March, 2023.

There have been no material changes and commitments which affect the financial position of the Company which have occurred between the end of the financial year to which the financial statements relate and the date of this report.

There was no change in the nature of business of the Company during the financial year ending on 31^st March, 2023.

During the year under review, there were no significant or material orders passed by the regulators or courts or tribunals impacting the going concern status and the Company's operations in the future.

Your Company does not have any Joint Ventures or Associate Companies. The subsidiaries of the Company as on 31^st March, 2023 are listed below:

1 Popular Mega Motors (India) Private Limited

2 Popular Autoworks Private Limited

3 Vision Motors Private Limited

4 Popular Auto Dealers Private limited

5 Kuttukaran Cars Private Limited (erstwhile Prabal Motors Private Limited)

6 Kuttukaran Green Private Limited (erstwhile Kuttukaran Pre Owned Cars Private Limited)

7 Keracon Equipments Private Limited

8 Prabal Motors Private Limited

During the reporting financial year, the shares held by Popular Auto Dealers Private Limited in Kuttukaran Green Private Limited have been transferred to the Company. Hence, Kuttukaran Green Private Limited has become a wholly-owned subsidiary of the Company.

During the reporting financial year, the shares held by the promoters of the Company in Keracon Equipments Private Limited has been transferred to the Company. Hence, Keracon Equipments Private Limited has become a wholly-owned subsidiary of the Company with effect from 01^st February, 2023.

Prabal Motors Private Limited which is the subsidiary of Keracon Equipments Private Limited has become the step down subsidiary of the Company with effect from 01^st February, 2023.

There has been no material change/s in the nature of business of the subsidiaries during the financial year.

Pursuant to provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of the Company's subsidiaries in Form AOC- 1 is appended as Annexure A to the report.

During the financial year, the Board of Directors of your Company comprised of seven Directors, i.e. Mr. Naveen Philip, Managing Director, Mr. John K. Paul, Whole-Time Director, Mr. Francis K Paul, Whole-Time Director, Mr. Abhishek G. Poddar, Nominee Director, Mr. Jacob Kurian, Independent Director, Ms. Preeti Reddy, Independent Director, and Mr. George Joseph, Independent Director.

The nomination of Mr. Rahul G. Kurup who was appointed as Nominee Director of the Company was withdrawn by Banyantree Growth Capital II, LLC with effect from 27^th September, 2022. The Board of Directors place on record their appreciation

of the contributions made by Mr. Rahul G. Kurup during his tenure as a Director of the Company.

Mr. Abhishek G. Poddar has been nominated in place of Mr. Rahul G. Kurup and he is the Nominee Director of the Company with effect from 27^th September, 2022.

After the end of the financial year, Mr. Abhishek G Poddar has resigned from the position of the Nominee Director with effect from 19^th June, 2023.

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013.

The Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Act.

I n accordance with the Articles of Association, Mr. Francis K. Paul, Whole-Time Director retires by rotation at the ensuing Annual General Meeting. Mr. Francis K. Paul, being eligible, seeks reappointment at the Annual General Meeting.

During 2022-23, the Company held five (5) meetings of the Board of Directors on 14^th June, 2022, 27^th September, 2022, 19^th January, 2023, 02^nd February, 2023, and 29^th March, 2023. The intervening gap between the meetings is within the period as prescribed under Section 173 (1) of the Companies Act, 2013.

The Board of Directors have constituted an Audit Committee, Nomination and Remuneration Committee, Stakeholders' Relationship Committee and CSR Committee as per the requirement of the Companies Act, 2013.

The Company has also constituted a Finance and Authorisation Committee (sub-committee), IPO Committee and Risk Management Committee.

The Audit Committee has been constituted with Mr. George Joseph (Chairman), Mr. Jacob Kurian, Ms. Preeti Reddy and Mr. Naveen Philip as members.

During FY 2022-23, the Company held five (5) meetings of the Audit Committee on 14^th June, 2022, 27^th September, 2022, 19^th January, 2023, 02^nd February, 2023, and 29^th March, 2023.

All the recommendations of the Audit committee were accepted by the Board during the financial year under review.

The Company reconstituted the Nomination and Remuneration Committee with Ms. Preeti Reddy (Chairperson), Mr. Jacob Kurian, Mr. George Joseph and Mr. Abhishek G. Poddar as members at the Board meeting dated 27^th September, 2022.

During 2022-23 the Company held two (2) meetings of the Nomination and Remuneration Committee on 14^th June, 2022, and 27^th September, 2022.

The Company reconstituted its Stakeholders' Relationship Committee with Mr. George Joseph (Chairman), Mr. Naveen Philip, Ms. Preeti Reddy and Mr. Abhishek G. Poddar as members at its Board meeting dated 27^th September, 2022.

During 2022-23, the Company held one (1) meeting of the Stakeholders' Relationship Committee on 19^th January, 2023.

Corporate Social Responsibility Committee was reconstituted with Mr. Francis K. Paul (Chairman), Mr. John K. Paul, Mr. Abhishek G. Poddar and Mr. Jacob Kurian as members at the Board meeting dated 27^th September, 2022.

During 2022-23, the Company held one (1) meeting of the Corporate Social Responsibility Committee on 29^th March, 2023.

The Risk Management Committee was constituted with Mr. Naveen Philip (Chairman), Mr. Jacob Kurian, Mr. Francis K Paul, Mr. George Joseph and Ms. Preeti Reddy as members.

There were no meetings of the Risk Management Committee during 2022-23.

The Company also reconstituted the Finance and Authorisation Committee (sub-committee) with Mr. Naveen Philip (Chairman), Mr. John K. Paul, Mr. Francis K. Paul and Mr. Abhishek G. Poddar as members at its Board meeting dated 27^th September, 2022.

During 2022-23, the Company held twenty (20) meetings of the Finance and Authorisation Committee on 01^st April, 2022, 03^rd May, 2022, 06^th May, 2022, 17^th June, 2022, 04^th July, 2022, 13^th July, 2022, 18^th August, 2022, 15^th September,

2022, 28^th September, 2022, 17^th October, 2022, 26^th October, 2022, 24^th November, 2022, 02^nd December, 2022, 17^th December 2022, 09^th January, 2023, 12^th January, 2023, 06^th February,

2023, 23^rd February, 2023, 08^th March, 2023, and 29^th March, 2023.

The shareholders at the 38^th Annual General Meeting held on 14.072022 appointed Mr. Naveen Philip as the Managing Director of the Company for a period of 5 years commencing from 15^th June, 2022 till 14^th June, 2027.

As recommended by the Board of Directors at their meeting held on 14.06.2022, the members at the 38^th Annual General Meeting held on 14^th July, 2022 had appointed Mr. John K. Paul as Whole-Time Director of the Company, subject to approval of the Central Government for a period commencing from 15^th June 2022 to 31^st March, 2024 as he had stepped down from the post of Managing Director of the Company on 15^th June 2022 to appoint a new Managing Director, as part of the Company's succession plan.

Mr. Francis K. Paul has been re-appointed as the Whole-Time Director of the Company till 31^st March, 2024.

At the ensuing 39^th Annual General Meeting, it is proposed to re-appoint Mr. John K. Paul and Mr. Francis K. Paul as Whole-Time Directors of the Company for a period of 2 years commencing from 01^st April, 2024 to 31^st March, 2026.

Pursuant to the provisions of Section 203 of the Companies Act, 2013, your Company has appointed the following Key Managerial Personnel:

(i) Mr. Raj Narayan as Chief Executive Officer

(ii) Mr. John Verghese as Chief Financial Officer

(iii) Mr. Varun T V as Company Secretary

Mr. Raj Narayan was appointed as the Chief Executive Officer of the Company with effect from 10^th October, 2022.

The Company has devised a policy for performance evaluation of the individual directors and the Board, which includes criteria for performance evaluation.

The provisions as contained in Schedule IV of the Companies Act, 2013 does not provide for performance evaluation of independent directors by the Board on yearly basis and is said to be taken to decide on their reappointment, hence the performance evaluation of independent directors is not done by the entire Board of Directors.

However, a separate meeting of the Independent Directors was held on 29^th March,2023 for evaluation of the performance of Non-Independent Directors, performance of the Board as a whole and that of the Chairman of the Board.

Feedback was sought from all the Directors of the Company, by way of a structured questionnaire covering various aspects, on performance evaluation of the Board, Committees of Board, Independent Directors, Non-Independent Directors and the Chairman considering criteria such as Board's composition and structure, effectiveness of the Board, performance of the Board, processes and information provided to the Board, etc.

The committee of independent directors evaluated performance of its own and of its Committees based on the feedback so received.

In terms of clause(c) of sub-section (3) of Section 134 read with sub section (5) of Section 134 of the Companies Act, 2013, the Directors hereby state and confirm that:

(a) i n the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) 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 of the Company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis; and

(e) 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.

Your Company has not accepted any public deposits and as such no amount on account of principal or interest on public deposits was outstanding as on the date of the Balance Sheet. Thus, no particulars are reported as required under Rule 8(5(v) of Companies (Accounts) Rules, 2014.

M/s B.S.R Associates LLP, 3^rd Floor, Syama Business Centre, N.H Bypass Road, Vytilla, Kochi- 682019, Firm Registration No. 116231W/W-100024 has been reappointed as Statutory Auditors of the Company by the members for a term of five consecutive years, from the conclusion of the 37^th Annual General Meeting until the conclusion of the 42^nd Annual General Meeting of the Company to be held in the year 2026.

The Statutory Auditors' Report on the standalone financial statements for the financial year ending 31^st March, 2023 does not contain any qualification, reservation or adverse remarks.

However the Statutory Auditors' report on the consolidated financial statements has reference to the modified opinion as given in Annexure A of the Independent Auditor's report of Popular Mega Motor(s) India Private Limited (clause (xi)(a)-Fraud), Kuttukaran Cars Private Limited (clause (ix) (d)- fund raised on short term basis), Prabal Motors Private Limited (clause (ii)(b)-quarterly returns filed by the Company and clause (ix)(d)- fund raised on short term basis). The Board of Directors of the respective Companies have responded to the modified opinions in their report.

During the year under review, the Company has given Corporate Guarantees amounting to Rs. 44 crores for Popular Mega Motors (India) Private Limited, Rs. 4 crores for Kuttukaran Cars Private Limited, Rs. 2 crores for Kuttukaran Green Private Limited, Rs. 4.83 crores for Popular Auto Dealers Private Limited and Rs.9.50 crores to Popular Autoworks Private Limited for availing credit facility from bank/NBFCs by the subsidiary companies.

The Company has also renewed various guarantees provided for its subsidiaries during the year.

The details of the investments made and loans given by the Company in/to the subsidiary companies are given in the notes to the financial statements and are in compliance with the relevant provisions of section 186 of the Companies Act, 2013, read with the rules thereon.

The transactions with related parties are in compliance with the provisions contained in Section 188(1) of the Act read with Rule 15 of the Companies (Meetings of Board and its Powers) Rules, 2014. Information on transactions with related parties pursuant to Section 134(3)(h) of the Act, read with Rule 8(2) of the Companies (Accounts) Rules, 2014, are given in Annexure-B in Form AOC-2 and the same forms a part of this report.

I n terms of the provisions of Section 197(12) of the Act read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, the particulars of the employees drawing remuneration in excess of the limits set out in the said rules are as follows:

The Company has in place a Policy for prevention of Sexual Harassment at the Workplace in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013.

The Company has constituted an Internal Committee as required under the said Act to take necessary preventive actions as may be possible and also to carry out redressal of complaints, if any, on sexual harassment and for matters connected therewith or incidental thereto. All employees (permanent, contractual, temporary, trainees) are covered under this policy. Summary of sexual harassment complaints received and disposed of during the calendar year 2022 are as follows:

(a) Number of complaints pending at the beginning of the year : 1

(b) Number of complaints received during the year: 1

(c) Number of complaints disposed off during the year: 2

(d) Number of cases pending at the end of the year: 0

The Committee has submitted the Annual Report on POSH to the Company and to the District Officer, pursuant to Section 21 of the POSH Act, 2013. The report has also been submitted to authorities under law.

The Company uses power-saving lighting equipment for its offices and workshops and conserves power wherever there is scope for energy savings.

No technology absorption has taken place during the year under consideration.

There was no foreign exchange earnings during the Financial Year ended 31^st March 2023. The Foreign exchange outgo during the Financial Year ended 31^st March 2023 is given below;

The Company, since its inception, has been a responsible member of the society and has pioneered activities that promote various social and charitable objectives. The Company has also, over the years, undertaken various social and charitable activities directly as well as through NGOs.

As on 31^st March, 2023, the CSR committee consists of:

• Mr. John K. Paul, Whole-Time Director

• Mr. Francis K. Paul, Whole-Time Director

• Mr. Jacob Kurian, Independent Director

• Mr. Abhishek G. Poddar, Nominee Director

The major focus of the Committee was education, health and women empowerment. The committee supported the installation of sanitary napkin burners and water filters for girls hostels. There were various seminars, workshops, medical camps, self-defence training classes and skill training classes organized for underprivileged women in the society and it also supported in providing accommodation and food for eligible girl students. This was executed through the "K.P. Paul Foundation”.

The Company's CSR policy is available on our website, at https://www.popularmaruti.com/investor-relations/ wp-content/uploads/2022/01/Corporate-Social- Responsibility-Policy.pdf

The annual report on CSR Activities as per companies (Corporate Social Responsibility Policy) Rules, 2014 is given in Annexure-C.

Pursuant to Section 204 of the Companies Act, 2013, the Company has appointed Mr. M.C. Sajumon, Practising Company Secretary, Kochi, as Secretarial Auditor to conduct Secretarial Audit of the Company for the financial year ending 31^st March, 2023. The report of the Secretarial Auditor for the financial year 202223 is annexed to this report. The secretarial auditor's report does not contain any qualifications, reservations or adverse remarks or disclaimer.

The Annual Return of the Company is available on the website of the Company at https://www.popularmaruti. com/investor-relations/financials/annual-reports/ annual-returns/.

In accordance with Section 177 of the Companies Act, 2013, the Company has formulated a Vigil Mechanism for Directors and employees to report their genuine concerns about unethical behaviour, actual or suspected fraud or violation of the company's code of conduct. It provides adequate safeguards against victimisation. It also provides direct access to the higher levels of supervisors and/or to the Chairman of the Audit Committee, in appropriate or exceptional cases. The policy has been overseen by the Audit Committee. The details of the policy can also be accessed on the Company's website: https://popularmaruti.com/ investor-relations/wp-content/uploads/2022/01 / WhistleBlower-Policy.pdf.

The Company has in place a mechanism to identify, access, monitor and mitigate various risks to key business objectives. Major risks identified by the business and functions are systematically addressed through mitigating actions on a continuous basis.

The Company's internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by the statutory as well as internal auditors. Significant audit observations and follow-up actions thereon are reported to the Board.

During the year under review, CRISIL through its credit rating report dated 25^th April, 2023 has re-affirmed CRISIL BBB+/Stable rating for long-term facilities; shortterm rating of 'CRISIL A2' for the debt instruments/ facilities has been re-affirmed too.

The Company has established a full-fledged internal audit team headed by a qualified Chartered Accountant. Audit team conducts regular reviews of the business processes, operations and financial transactions to ensure adequacy and existence of effective control systems, investigate probable risks, deviations, fraud or misappropriations.

During the year under review, the Statutory Auditors has not reported to the Board under Section 143(12) of the Companies Act, 2013 any instances of fraud committed against the Company by its officers or employees.

Human Resource Department (HRD) plays a pivotal role in achieving organizational excellence. Your Company constantly strives to develop quality human resources by providing a congenial and conducive work environment to meet the challenges of a competitive business environment and to build critical capabilities in accomplishing the Company's objectives and goals. The Company continuously renews and updates the knowledge and skills of its employees at all levels through training and development.

As on 31^st March, 2023, the Company had a total head count of 6,407 employees, a decrease of 209 people over the previous year. Your Company takes significant efforts on employee development by imparting training to employees at various levels or the organisation.

Your Company wishes to put on record its deep appreciation for the cooperation and efforts of its employees for the continuous betterment of the organization.

During the year under review, the Company enjoyed cordial relationship with workers and employees at all levels and the Directors thank all employees for their continued support, co-operation and valuable contributions.

The NRC of the Board has devised a policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management. The Committee has formulated the criteria for determining the qualifications, positive attributes and independence of Directors, which has been put up on the Company's website:

https://popularmaruti.com/investor-relations/wp- content/uploads/2023/02/Remuneration-Policy-for

Directors-and-Senior-Management.pdf.

The relevant standards issued by the Institute of Company Secretaries of India (ICSI) related to the Board meetings and general meetings have been complied with by the Board.

Not applicable.

Not applicable.

All the assets of the Company have been adequately insured.

We wish to thank our clients, vendors, investors and bankers for their continued support during the year. We place on record our sincere appreciation for the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, commitment, cooperation and support. We thank the Government of India, particularly the Ministry of Labour and Employment, the Ministry of Commerce and Industry, the Ministry of Finance, the Ministry of Corporate Affairs, the State Governments of Kerala and Tamil Nadu, the Central Board of Direct Taxes, the Central Board of Indirect Taxes and Customs, GST authorities, the Reserve Bank of India, various departments under the state governments and other government agencies for their support, and look forward to their continued cooperation in the future.

Place: Kochi-25 Date: 20.06.2023

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(Managing Director) DIN:00018827

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(Whole Time Director) DIN:00018825