L&T Finance : LTFH – Enterprise Accountability Report FY 2021-22

BUSINESS RESPONSIBILITY REPORT

L&T Finance Holdings Restricted is the holding firm for Larsen & Toubro Group’s monetary providers enterprise. L&T Finance Holdings referred as `Firm’) is considered one in all India’s main and well-diversified NBFCs. L&T Finance Holdings via its subsidiaries (collectively known as ‘LTFH’) has a robust presence throughout lending and non-lending companies. As on March 31, 2022, the lending enterprise included Rural Finance (together with Farm Tools Finance, Two-Wheeler Finance, Micro Loans and Client Loans), Housing Finance (together with Residence Loans, Mortgage Towards Property and Actual Property Finance) and Infrastructure Finance; and the non-lending enterprise comprised Funding Administration. These companies supply various services that assist clients safe each financing wants in addition to their future, even within the un-served and under-served segments of the society.

Respect and integrity for its folks, enterprise and neighborhood has been on the core of the Firm’s enterprise Accountability. The Firm believes in conducting its enterprise actions in a accountable and sustainable method and strives to ship long-term sustainable development.

The Enterprise Accountability Report (BRR) is aligned with Nationwide Voluntary Pointers (NVGs) on Social, Environmental and Financial Obligations of Enterprise, issued by the Ministry of Company Affairs (MCA), and is in accordance with Regulation 34(2)(f) of the Securities and Alternate Board of India (Itemizing Obligations and Disclosure Necessities) Rules, 2015.

The Firm’s enterprise efficiency and impression are disclosed based mostly on the 9 ideas as talked about within the NVGs.

BUSINESS RESPONSIBILITY REPORT 2021-22

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Part A: Common Details about the Firm

1. Company Identification Quantity (CIN) of the Firm:
   L67120MH2008PLC181833
2. Identify of the Firm: L&T Finance Holdings Restricted
3. Registered Workplace:
   Brindavan, Plot No. 177, C.S.T Street, Kalina, Santacruz (East), Mumbai – 400098.
4. Web site:
   www.ltfs.com
5. E-mailID: igrc@ltfs.com
6. Monetary 12 months reported: March 31, 2022
7. Sector(s) that the Firm is engaged in (industrial exercise code-wise):
   Non-Banking Monetary Establishment – Core Funding Firm (NBFC-CIC)
   NIC Code – 64200
8. Listing three key merchandise/providers that the Firm manufactures/supplies (as in steadiness sheet):
   The Firm is registered as a Core Funding Firm underneath RBI rules and it’s not finishing up with any enterprise exercise apart from funding in its subsidiaries.
   The enterprise carried out by the subsidiaries as on March 31, 2022 as follows:
9. 1. Rural Finance
   2. Housing Finance
   3. Infrastructure Finance
   4. Mutual Fund
10. Whole variety of areas the place enterprise exercise is undertaken by the Firm:

1. Variety of worldwide areas (present particulars of main 5)
   Nil
2. Variety of nationwide areas
   The Firm (via its subsidiaries) caters to the enterprise necessities of its rising buyer base via a nationwide community of throughout 1,722 branches (together with the company workplace and 1,524 Micro Loans branches)

10. Markets served by the Firm Home (India)

Part B: Monetary Particulars of the Firm

1. Paid up Capital (R):

As at March 31, 2022, the paid-up fairness share capital of the Firm stood at R 35,96,98,74,030 comprising of 24,72,88,74,03 fairness shares of R 10 every amounting to R 24,72,88,74,030 and 11,24,10,000 choice shares of R 10 every amounting to R 11,24,10,00,000.

1. Whole Turnover (R in Cr):
   For the monetary 12 months ended March 31, 2022, the overall turnover of the Firm on a consolidated foundation was R 12,323.55 Cr and on a standalone foundation was R 350.46 Cr.
2. Whole revenue after taxes (R in Cr):
   For the monetary 12 months ended March 31, 2022, the online revenue of the Firm on a consolidated foundation was R 1,070.11 Cr and R 218.18 Cr on a standalone foundation.
3. Whole spending on Company Social Accountability (CSR) as share of revenue after tax (%):
   The Firm was not required to contribute any quantity in direction of CSR actions throughout FY22 as per the provisions of Part 135 of the Firms Act, 2013 (“the Act”).
   Throughout all its subsidiaries, the general spend for the CSR actions was R 24.44 Crore for FY22, together with extra spend of R 0.07 Crore, which can be offset from FY23 CSR price range.
4. Listing of actions by which expenditure in Four above has been incurred:
   The subsidiaries of the Firm have primarily undertaken CSR actions in areas of Digital Monetary Inclusion, Catastrophe Administration and different tasks like Street security and Healthcare.

Part C: Different Particulars

1. Does the Firm have any subsidiary firm/ firms?

The Firm conducts its enterprise via its subsidiaries. As at March 31, 2022, the Firm had Eight subsidiaries (together with step-down subsidiaries).

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1. Do the Subsidiary Firm/Firms take part within the BR initiatives of the father or mother firm? If sure, then point out the variety of such subsidiary firm(s):
   The Firm is a holding firm and as such carries out its enterprise via its wholly-owned subsidiaries (straight or not directly). The insurance policies and processes adopted throughout all the businesses inside LTFH and subsidiaries are uniform, besides as required, foundation relevant rules and / or market apply. Thus, the subsidiary firms take part within the BR initiatives of the father or mother firm.
2. Do some other entity/entities (e.g., suppliers, distributors and so on.) that the Firm does enterprise with take part within the BR initiatives of the Firm? If sure, then point out the proportion of such entity/entities? [Lower than 30%, 30-60%, Greater than 60%]
   The Firm endeavors to encourage its suppliers/ distributors (wherever doable) to take part within the initiatives in direction of enterprise duty and to undertake practices which might assist them to hold out enterprise in a good method.
   With an intent to encourage ESG consciousness amongst its value-chain companions, the Firm has applied the Third-Get together Code of Conduct and likewise strengthened the contractual obligations. The Code covers all Third Events together with distributors, debtors, items and repair suppliers, individuals holding enterprise relationship or an association with the Firm, together with their administrators, officers,

2. Precept-wise (as per NVGs) BR Coverage/insurance policies: a. Particulars of compliance (Reply in Y/N)

associates, associates, sister issues, successors, brokers, representatives and nominees. The clauses selling adoption of the Code are included in Third Get together agreements. The Third-Get together Code of Conduct is out there on the web site of the Firm at www.ltfs.com.

Part D: Enterprise Accountability Info

1. Particulars of Director liable for BR:

1. Particulars of the Director liable for implementation of the BR coverage/insurance policies
   The small print of CSR and ESG Committee (CSR Committee was renamed as CSR and ESG Committee w.e.f. April 24, 2021) and their roles and tasks are elaborated within the CSR Annual Report and Company Governance Report forming a part of Annual Report.

Sr.	Particulars	Particulars
No.
1	DIN Quantity	03545900
	(if relevant)
2	Identify	Mr. Dinanath Dubhashi
3	Designation	Managing Director &
		Chief Government Officer
4	Phone no.	022 6212 5000
5	E mail id	igrc@ltfs.com

1. Particulars of the BR head: Ms. Apurva Rathod, Group Head – Secretarial & CSR and Sustainability

Sr.

Questions

P1

P2

P3

P4

P5

P6

P7

P8

P9

No.

1.

Do you could have a coverage / insurance policies for

Y

Y

Y

Y

Y

Y

Y

Y

Y

2.

Has the coverage being formulated in session with

All insurance policies have developed over a time period via

the related stakeholders?

session with stakeholders together with benchmarking with

the business gamers and the place required, exterior consultants.

3.

Does the coverage conform to any nationwide / worldwide

The insurance policies adopted by the Firm are in conformity with

requirements? If sure, specify? (50 phrases)

the relevant guidelines and rules.

4.

Has the coverage being permitted by the Board? *

Insurance policies wherever acknowledged have been permitted by the Board

Is sure, has it been signed by MD / proprietor / CEO /

/ Committees of the Board / Senior Administration of the

Firm and adopted throughout entities inside LTFH. Additional,

applicable Board Director?

the insurance policies are topic to common overview (no less than annually)

by the Board / Committees of the Board / Senior Administration.

5.

Does the corporate have a specified committee of the

Y

Y

Y

Y

Y

Y

Y

Y

Y

Board/ Director/ Official to supervise the implementation

of the coverage?

6.

Point out the hyperlink for the coverage to be seen on-line.

As per regulatory necessities the insurance policies of the Firm

have been uploaded on the web site of the Firm i.e.,

www.ltfs.com/traders.html

7.

Has the coverage been formally communicated to all

Y

Y

Y

Y

Y

Y

Y

Y

Y

related inner and exterior stakeholders?

8.

Does the Firm have in-house construction to

Y

Y

Y

Y

Y

Y

Y

Y

Y

implement the coverage / insurance policies?

9.

Does the Firm have a grievance redressal

Y

Y

Y

Y

Y

Y

Y

Y

Y

mechanism associated to the coverage / insurance policies to handle

stakeholders’ grievances associated to the coverage / insurance policies?

10.

Has the Firm carried out impartial audit/

Y

Y

Y

Y

Y

Y

Y

Y

Y

analysis of the working of this coverage by an inner

or exterior company?

BUSINESS RESPONSIBILITY REPORT 2021-22

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1. If reply to the query at serial no 1 in opposition to any precept, is ‘No’, please clarify why: Not Relevant

3. Governance associated to BR:

1. Point out the frequency with which the Board of Administrators, Committee of the Board or CEO assess the BR efficiency of the Firm. Inside Three months, 3-6 months, Yearly, greater than 1 12 months.
   Sustainability is on the coronary heart of LTFH’s enterprise and operations. The Firm has established the apply of targeted discussions on ESG efficiency in each quarterly Board assembly in addition to via periodic newsletters. The CSR and ESG Committee opinions the ESG efficiency on an annual foundation. ESG efficiency can also be reviewed frequently by the Firm’s management, together with by the Managing Director and CEO.
2. Does the Firm publish a BR or a Sustainability Report? What’s the hyperlink for viewing this report? How regularly it’s printed?
   The Firm publishes a BR Report (BRR) in accordance with the rules specified by SEBI. The BRR is reviewed and printed on an annual foundation.
   Moreover, on a voluntary foundation, the Firm has been publishing Sustainability Report yearly since FY19. For the FY22, the Firm can be publishing the Built-in Report (IR). This Report has been ready in accordance with the ideas of Worldwide Built-in Reporting Council’s (IIRC’s) Framework. The disclosures have been made in accordance with the World Reporting Initiative (GRI) Requirements: Core possibility. Moreover, the Built-in Report has additionally been assured by an exterior impartial agency i.e., Ernst & Younger Associates LLP.

The BRR and the Built-in Report might be accessed at https://www.ltfs.com/csr.html and the hyperlink of the identical has been supplied within the Annual Report of the Firm for simple reference.

Part E: Precept-Sensible Efficiency

Precept 1: Companies ought to conduct and govern themselves with Ethics, Transparency and Accountability

LTFH, is part of the eight-decade plus previous L&T Group, the place highest stage of governance is practiced. LTFH upholds the worth methods and integrity which have been the hallmark of L&T. Governance is the muse driving sustainability, innovation and enterprise efficiency at

LTFH. The Firm has always strived to realize benchmarks of excellence in company behaviour by implementing highest requirements of methods and processes.

Company governance is central to the Firm’s sustainability efficiency. Sturdy company governance performs a key position in creating long run stakeholder worth. The governance construction effectuates the Firm’s action-oriented tradition of ‘Outcomes’ not ‘Causes’ and is predicated on the muse of Assurance. The Firm’s core values of Pleasure, Integrity, Self-discipline and Ambition are an integral a part of the Firm’s governance, tradition, insurance policies, practices and relationships with stakeholders.

The Board actively guides and helps reaffirm the values of LTFH. The company governance construction at LTFH harmonises the pursuits and expectations of stakeholder teams equivalent to shareholders, regulators, workers, clients and the broader neighborhood, in growing and distributing worth. LTFH’s company governance framework is pushed by the sharp deal with implementing greatest practices and complying with the relevant regulatory necessities.

The Firm is dedicated to highest ranges of ethics in its operations and enterprise. LTFH has created an enabling coverage surroundings that promotes moral conduct. The insurance policies of LTFH clearly lay out the expectations from stakeholders and redressal mechanisms in case of any grievance or breach.

Code of Conduct

LTFH has a publicly obtainable Worker Code of Conduct protecting points like corruption and bribery, discrimination, confidentiality of data, battle of curiosity, antitrust/ anti-competitive practices, cash laundering and/or insider buying and selling/dealing, surroundings, well being, and whistle blowing. The Code of Conduct supplies tips to be adopted by workers in recognized areas the place Battle of Curiosity might happen. These embrace skilled engagement, private relationships and use of firm belongings to call a couple of. No circumstances associated to battle of curiosity had been recognized or reported through the 12 months and thus, there have been no fines and penalties paid to this impact.

Each worker is required to attest to point that s/he has learn and signed, both in writing or electronically, a doc acknowledging that s/he understands and can adjust to the Firm’s Code of Conduct. Each new joiner goes via a coaching of the Code of Conduct throughout their induction programme. The prevailing workers in non-frontline roles mandatorily undergo the Code of Conduct e-learning module yearly and undertake an evaluation publish coaching.

At LTFH, workers are anticipated to diligently adhere to the rules and ideas as acknowledged within the Code of Conduct. Within the occasion of any breach, the fast supervisor or department head that an worker stories to is anticipated to undertake worker counselling for initiating corrective motion. Penalty, relying upon the character and seriousness of breach or violation, might vary from

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censure to termination of employment. Workers should report any cases of breach/ violations to the Code by way of e mail at code@ltfs.com. LTFH has constituted a CoC Committee to manage the compliance of the Code of Conduct.

Throughout FY22, there have been no cases of breaches to the Code of Conduct. The Firm didn’t incur any fines or settlements associated to anticompetitive or anti-trust practices.

Vigil Mechanism and Whistle-Blower Coverage

The Firm has a structured whistle blowing mechanism, which permits workers to report with out concern, any misconduct or unethical apply, that will adversely impression the Firm’s repute or its financials. The Vigil Mechanism Framework is permitted by the Board of LTFH and is relevant to all workers, administrators and repair suppliers of the Firm. Additionally, as a part of this coverage, any incidents might be reported by sending an e mail to whistleblower@ltfs.com.

Anti-Corruption Coverage

LTFH has a publicly obtainable Anti-Corruption Coverage, which highlights the Firm’s dedication to relevant legal guidelines, guidelines and rules pertaining to interactions with authorities officers associated to the LTFH’s enterprise. The Coverage is relevant to all administrators, officers and workers, in addition to exterior events performing on behalf of LTFH and its subsidiaries.

The Coverage helps the Firm determine and keep away from conditions that might doubtlessly violate ant-ibribery and anti- corruption legal guidelines or create any look of impropriety.

Whereas the Anti-Corruption coverage has provisions for charitable donations, it clearly states that political contributions ought to essentially observe relevant legal guidelines. LTFH imposes fines and penalties on workers who’re in contravention of the Anti-Corruption Coverage. Throughout FY22, LTFH reported no circumstances of bribery or corruption.

Tax Rules

LTFH is dedicated to adjust to the tax legal guidelines and rules within the international locations by which the Firm operates. LTFH endeavours to undertake all relevant statutory tax compliances inside stipulated timelines and make enough disclosures associated to the identical. LTFH might legitimately use tax incentives and exemptions provided by governments. LTFH shouldn’t be in contravention of any rules, the non-compliance to which may adversely impression the continuity of its operations.

Precept 2: Companies ought to present items and providers which might be protected and contribute to sustainability all through their life cycle

Sustainability is on the core of LTFH’s enterprise and operations. The Firm is dedicated to integrating ESG issues in its lending processes throughout the credit score lifecycle (i.e., screening, due diligence, mortgage sanction, monitoring), and in-turn enabling investments

into sustainable financial actions and tasks. The ESG Coverage of LTFH has set the issues to be taken under consideration whereas lending. These issues minimize throughout key companies of the Firm together with Infrastructure, Actual Property, SME and retail companies.

Consistent with the important thing issues for Infrastructure Finance phase, the Firm focuses totally on financing long run sustainable tasks in renewable vitality, roads, transmission, airports, and metropolis gasoline. For all its financing actions funded via proceeds from AIIB and IFC, LTFH conducts due diligence for the funding/venture to make sure compliance with relevant environmental, well being, security and social legal guidelines, rules and requirements in addition to ratified worldwide conventions. Throughout FY22, the Firm financed 2,909 MW of wind and three,024 MW of photo voltaic tasks, which resulted in over 2 million tCO2e emissions being averted.

The Firm supplies Micro Loans to ladies who run agriculture and allied actions, manufacturing, buying and selling or providers associated microenterprises. Primarily based on the client profile, the typical ticket measurement is roughly R 45,000. These loans allow ladies to considerably improve their contribution to family revenue and obtain higher dignity of life. The Firm additional helps the shoppers with repeat loans based mostly on want and compensation capability, thereby driving enhanced livelihood. Farm Tools Finance has helped in mechanisation of agriculture, promotion of entrepreneurship, larger comfort and better revenue producing capabilities for its clients.

LTFH has additionally been selling equitable improvement via its retail financing technique. 50% of the Firm’s mortgage e-book was from low-income states as on March 31, 2022. With the intention to promote sustainable transportation, the Firm has began funding EV two-wheelers underneath its Two-Wheeler financing enterprise. In FY22, LTFH financed 5,450 EV two-wheelers.

The Firm proactively undertakes schooling initiatives for patrons in order to empower and allow them to take proper monetary choices. The Firm has developed a buyer consciousness coaching module and made the identical obtainable publicly on its web site (www.ltfs.com) for the advantage of its clients. Throughout the 12 months, LTFH carried out plenty of social media campaigns for buyer consciousness and sensitisation. These embrace posts on monetary literacy, highway security, well being, surroundings conservation and so on. The Mutual Fund enterprise additionally carries out a number of investor consciousness programmes in order to allow knowledgeable selections in monetary providers.

Throughout FY22, LTFH adopted Third- Get together Code of Conduct protecting all distributors, debtors, items and repair suppliers and individuals holding enterprise relationship with the Firm. The Code units expectations from its worth chain companions with respect to Accountable enterprise conduct, Environmental stewardship and Socially Sustainable Practices. LTFH will attempt to sensitise its worth chain companions on the Code of Conduct and ESG associated greatest practices.

BUSINESS RESPONSIBILITY REPORT 2021-22

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Disclaimer

L&T Finance Holdings Restricted printed this content material on 15 June 2022 and is solely liable for the knowledge contained therein. Distributed by Public, unedited and unaltered, on 15 June 2022 07:12:01 UTC.

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All information about L&T FINANCE HOLDINGS LIMITED

Gross sales 2022 69 647 M 893 M 893 M Web revenue 2022 12 157 M 156 M 156 M Web Debt 2022 – – – P/E ratio 2022 14,2x Yield 2022 0,98%

Capitalization 171 B 2 197 M 2 197 M Capi. / Gross sales 2022 2,46x Capi. / Gross sales 2023 2,23x Nbr of Workers 22 532 Free-Float 31,2%

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Technical evaluation tendencies L&T FINANCE HOLDINGS LIMITED

	Brief Time period	Mid-Time period	Lengthy Time period
Developments	Bearish	Impartial	Impartial

Revenue Assertion Evolution

Promote Purchase
Imply consensus	BUY
Variety of Analysts	10
Final Shut Value	70,45 INR
Common goal worth	97,90 INR
Unfold / Common Goal	39,0%