Fino Paytech Limited Unlisted Shares

Annual Report Summary

Fino Paytech Limited Annual Report F.Y. 2021-2022 Summary:

This document is the Sixteenth Annual Report of FINO PAYTECH LIMITED, including both standalone and consolidated financial statements, for the year ending March 31, 2022.

Financial Highlights & Performance:

The report presents a summary of the standalone and consolidated financial results.

• Net Sales and Other Income (Consolidated): increased from ₹86,037.22 Lakhs (2020-21) to ₹105,063.02 Lakhs (2021-22).
• The increase in Net Revenue was on account of an Offer for Sale of 1,56,02,999 equity shares.
• Profit/(Loss) before Tax (Consolidated): went from a loss of ₹(4,976.65) Lakhs (2020-21) to a loss of ₹(5,184.10) Lakhs (2021-22).
• Net Profit/(Loss) after Tax (Consolidated): shifted from a loss of ₹(5,040.18) Lakhs (2020-21) to a loss of ₹(5,314.68) Lakhs (2021-22).
• Bharat Petroleum Corporation Limited (BPCL) holds a 21.97% investment in the Company, making it an associate company.

Dividend Payments:

• An interim dividend of ₹37.71 per Equity and Preference share was declared and paid.
• Dividends were paid to Series A, B, and C Preference Shareholders.

Share Capital Changes:

• 29,66,470 equity shares were allotted on a rights basis on September 27, 2021.
• Conversion of warrants held by ICICI Lombard and ICICI Bank into equity shares was approved.
• 13,12,575 Equity Shares were allotted to employees/ex-employees who exercised their ESOPs.
• The Company has not issued sweat equity shares or shares with differential voting rights.
• The issued and paid-up share capital increased from ₹1,23,45,93,260/- to ₹1,33,23,83,710/-.

Subsidiary Stake Dilution:

• The company diluted a 25% stake in Fino Payments Bank Limited by selling 1,56,02,999 equity shares at ₹577/- each through an Offer for Sale, aggregating to ₹9,00,29,30,423/-.

Articles of Association:

• The Articles of Association were altered via a special resolution on September 30, 2021.

Impact of COVID-19:

• The first quarter coincided with the second wave. The Company is operating as per government directives and will monitor changes.

Company's Business:

• The Company provides technology solutions to banks, insurance companies, government and non-government institutions.

Subsidiary & Associate Company Performance:

• Fino Payments Bank Limited had total revenue of ₹1,00,885.39 Lakhs and a Net Profit of ₹4,274.08 Lakhs.
• Fino Finance Private Limited had revenue of ₹1,457.65 Lakhs and a Net Loss of ₹7,438.80 Lakhs.
• Fino Financial Services Private Limited reported revenue as NIL and a Net Loss of ₹0.88 Lakhs.
• Fino Trusteeship Services Limited had revenue of ₹39.34 Lakhs and Net Profit of ₹27.91 Lakhs.

Subsidiary/Associate Details:

A table lists FINO Finance Private Limited, FINO Trusteeship Services Ltd., FINO Payments Bank Limited, and FINO Financial Services Pvt. Ltd.

• Fino Finance Private Limited was acquired in 2010 and is a wholly-owned subsidiary
• FINO Trusteeship Services Ltd was incorporated in 2009 and is an associate company
• FINO Payments Bank Limited was converted in 2017 and is a subsidiary
• FINO Financial Services Pvt. Ltd was incorporated in 2014 and is a wholly-owned subsidiary

Directorate Changes:

• Marcus Peter Strutt Thompson was appointed as a Nominee Director effective January 25, 2022.
• Amit Jain and Alok Gupta resigned with effect from May 25, 2021, and December 31, 2021 respectively.
• Anjana Grewal's tenure as an Independent Director ended on February 16, 2022.
• Sudeep Gupta is retiring by rotation at the AGM and is eligible for re-appointment.

Key Managerial Personnel Changes:

• Praveer Kumar resigned as CFO effective December 10, 2021.
• Jitendra Kumar Garg resigned as Company Secretary & Manager - Legal effective March 07, 2022.

Board & Committee Matters:

• The Independent Directors fulfill independence criteria.
• The Company evaluates Board, Directors, and Committee performance annually, focusing on governance, transparency, and accountability.
• The Board had one meeting of Corporate Social Responsibility Committee on June 24, 2021. The CSR obligation of Company for Financial Year 2021-22 was Rs. 5.29 Lakh. Your Directors confirms that the entire above mentioned amount was spent towards approved CSR activities during the Financial Year 2021-22.
• The company incurred average Net Loss of Rs. 1,271.76 Lakhs in the immediately preceding three financial years. As per the CSR rules, the Company is required to contribute 2% of the average net profits i.e. Rs. NIL in any of the prescribed activities during the Financial Year 2022-23.

Other Disclosures:

• The Company has established a Vigil Mechanism.
• An Anti-Sexual Harassment Policy is in place and complied with.
• The Directors confirm adherence to accounting standards and maintenance of records.
• The Company has a Risk Management Policy and Internal Controls.
• MSKC & Associates are the Statutory Auditors. A P Sanzgiri & Co was appointed as Statutory Auditors to fill the casual vacancy.
• D M & Associates are the Secretarial Auditor.
• The company does not require cost records.

Annexures:

• Annexure A details conservation of energy, R&D, and technology absorption.
• Annexure B provides details of related party transactions.
• Annexure C details CSR initiatives.
• Annexure D is the Secretarial Audit Report.

Auditor's Report:

• M/s. MSKC & Associates expressed an unmodified opinion on the standalone financial statements, confirming a true and fair view in accordance with Indian Accounting Standards. The firm also provided a separate report on internal financial controls, stating they were adequate and operating effectively. The report highlights compliance with various legal and regulatory requirements.

Financial Statements:

• The report includes audited standalone and consolidated financial statements, including the balance sheet, statement of profit and loss, statement of changes in equity, and cash flow statement, prepared in accordance with Indian Accounting Standards (Ind AS).
• Notes to the financial statements provide detailed information about various items, including share capital, reserves and surplus, non-current and current liabilities, financial instruments, revenue, employee benefits, taxation, and segment reporting.
• The auditors have provided a report on the standalone financial statements and a separate report on the adequacy and operating effectiveness of internal financial controls over financial reporting.
• The audit report for the consolidated financial statements relied on the work of other auditors for certain subsidiaries.