Prime Securities Ltd Directors Report

The Board of Directors are pleased to present the Companys 41^st Annual Report on the business and operations along with the Audited Financial Statements for the Financial Year ended March 31, 2024.

Financial Performance

(H lakhs)

Particulars	Consolidated		Standalone
	March 31, 2024	March 31, 2023	March 31, 2024	March 31, 2023
Revenues from Operations	6,151	4,054	3,090	2,404
Other Income	513	630	275	469
Total Income	6,664	4,684	3,365	2,873
Total Expenses	4,325	3,340	2,349	1,962
Profit before Exceptional Items and Tax	2,339	1,344	1,016	911
Extraordinary Items	Nil	173	Nil	173
Profit before Tax	2,339	1,517	1,016	1,084
Tax Expenses	483	399	154	308
Profit after Tax	1,856	1,118	862	776
Other Comprehensive Income (Net of Tax)	1,065	732	1,063	738
Total Comprehensive Income	2,921	1,850	1,925	1,514

Overview of Companys financial & operational performance

Consolidated Revenues for the Year ended March 31, 2024 was H6,664 lakhs as compared to H4,684 lakhs in the previous financial year. Consolidated Profit after Tax including Other Comprehensive Income for the Year ended March 31, 2024 was H2,921 lakhs as compared to H1,850 lakhs during the previous financial year.

Standalone Revenues was for the Year ended March 31, 2024 was H3,365 lakhs as compared to H2,873 lakhs in the previous financial year. Standalone Profit after Tax including Comprehensive Income for the Year ended March 31, 2024 was H1,925 lakhs compared to H1,514 lakhs during the previous financial year.

Financial statements are prepared in accordance with the Companies (Indian Accounting Standards) Rules, 2015 (Ind-AS) notified under Section 133 and other applicable provisions of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, as amended from time to time.

The operations in the year remained transformative wherein emphasis on annuity type of income has produced a favorable impact. Investments in startup and early-stage businesses have remained healthy in terms of growth to carrying values. Our client base showed a meaningful addition. The growth in revenue and profits remain at appreciable levels

Acquistion of Artificial Intelligence / Machine Learning-based technology company in United Kingdom

During the year, pursuant to the authority granted by the Board of Directors on April 13, 2023, the Company entered into an agreement with Bridgeweave Limited ("Bridgeweave"), a UK based an Artificial Intelligence / Machine Learning-based technology company, that has developed a suite of financial products for retail investors. The Company has acquired about 10% equity stake in Bridgeweave and as a result of its approximately 10% equity stake in Bridgeweave, the Company is not just the second largest shareholder after the founders, but also an important strategic ally of Bridgeweave. Due to the length of time taken for the UK regulatory approval, the original 2023 deal terms have now expired and while the strategic intent remains on both sides, a new understanding would have to be reached to finalise the transaction. The Company continues to work closely with the Bridgeweave team, for onboarding the latter onto multiple broking platforms and expanding their presence in India.

Dividend and Reserves

The Board of Directors recommend a dividend of H1/- per Equity Share of face value of H5/- each for the Financial Year 2023-24, subject to the approval of the Members at the 41^st Annual General Meeting. In the previous year, the Company had declared dividend of H0.50 per Equity Share.

During the year under review, no amount from the Profit was transferred to Reserves.

Equity Share Capital

Paid-up Equity Share Capital of the Company as of March 31, 2024, was H1,664 lakhs. The outstanding Equity Shares were 3,32,88,825 Equity Shares of face value of H5/- each.

During the year under review, 9,31,600 Equity Shares were allotted to the eligible Employees / Directors of the Company / Subsidiaries pursuant to exercise of Options granted under Employee Stock Option Scheme 2018.

Utilisation of proceeds of preferential issue of equity shares

The Board of Directors had allotted 45,50,000 Equity Shares in November 2021 to select investors, on a Preferential basis, pursuant to approval granted by the Members at their Extraordinary General Meeting held on November 10, 2021. The part of the issue proceeds of H4,038 lakhs, received on allotment of Equity Shares, have been utilised in terms of the object clause, as amended by the subsequent resolution of members, and the remaining funds have been invested in the fixed deposits till deployment of funds for the purpose for which the funds were raised.

Management Discussion and Analysis Report

Pursuant to the provisions of the Regulation 34 of the SEBI Listing Regulations, the Management Discussion and Analysis Report giving a detailed account of the operations and the state of affairs of the Company is annexed as Annexure "1" to this Report.

Directors and Key Managerial Personnel

The Members of the Company, at their 40^th Annual General Meeting held on June 13, 2023, appointed Mr. Mayank Malik (DIN: 10178490) and Ms. Smeeta Harsha Bhatkal (DIN: 07363916) as Non-Executive and Independent Directors of the Company for a term of 5 years, pursuant to the notice received under Section 160 of the Companies Act, 2013. Based on the recommendation of Nomination and Remuneration Committee, the Board of Directors on August 8, 2023, approved the change in designation of Mr. Ashok Kacker (DIN: 01647408) from Non-Executive and Non-Independent Director to Non-Executive and Independent Director, for a term of Five Years from the date of original appointment, i.e. September 27, 2022.

The second term of Mr. Pradip Dubhashi, Chairperson, as Non-Executive and Independent Director completed on June 13, 2023. The first term of Ms. Namrata Kaul, as Non-Executive and Independent Director, completed on February 13, 2024, and she expressed her desire to not seek an appointment for the second term. Ms. Smita Affinwalla, NonExecutive and Independent Director, resigned w.e.f. June 19, 2023, due to the personal reasons. The Directors place on record their deep appreciation for the services rendered by Mr. Pradip Dubhashi, Ms. Namrata Kaul and Ms. Smita Affinwalla during their tenure as Non-Executive and Independent Directors.

The Company has received declaration under Section 149(7) of the Companies Act, 2013 from all the Independent Directors of the Company confirming that they meet the criteria of Independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI Listing Regulations and that their names have been included in the Databank of Independent Directors as prescribed under the Companies Act, 2013. In the opinion of the Board, the Independent Directors of the Company possess necessary expertise, integrity and experience.

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Sujit Kumar Varma, Non-Executive and Non-Independent Director, retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment. An appropriate resolution for re-appointment of Mr. Sujit Kumar Varma, who retires by rotation, is being placed before you for your approval at the ensuing Annual General Meeting. The information on the particulars of Director seeking appointment / re-appointment, as required under SEBI Listing Regulations, is given in the Notice of the Annual General Meeting, forming part of this Annual Report. The Board recommends his re-appointment for the consideration of the Members of the Company at the ensuing Annual General Meeting.

Mr. N. Jayakumar, Managing Director and Group CEO, Mr. Akshay Gupta, Whole-time Director, Mr. Arun Shah, Chief Financial Officer and Mr. Ajay Shah, Company Secretary were the key managerial personnel of the Company as on date of this report.

Number of meetings of the Board & its Committees

During the year under review, Nine Board Meetings were convened and held, the details of which are given in the Report on Corporate Governance, which forms a part of the Annual Report.

The Board of Directors constituted Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, Stakeholders Relationship Committee and Risk Management Committee, in compliance with the requirements of the relevant provisions of applicable laws and regulations. The details with respect to the composition, terms of reference, number of meetings held, etc. of these Committees are included in the Report on Corporate Governance, which forms a part of the Annual Report.

The intervening gap between the Board and Committee Meetings were within the period prescribed under the Companies Act, 2013 and SEBI Listing Regulations. The Company has complied with the applicable Secretarial Standards 1 (SS-1) on Board Meetings, issued by the Institute of Company Secretaries of India.

Board Evaluation

Annual performance evaluation of the Board of Directors, its committees and all the Directors individually were done in accordance with the performance evaluation framework adopted by the Company and a structured questionnaire was prepared after taking into consideration the various aspects of the Boards functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance. The performance evaluation framework sets out the performance parameters as well as the process of the performance evaluation. Pursuant to the provisions of the Companies Act, 2013, a separate Meeting of Independent Directors was held during the year to review (i) performance of the Non-Independent Directors and the Board of Directors as a whole (ii) performance of the Board Committees (iii) performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors (iv) assess the quality, quantity and timeliness of flow of information between the Management and the Board of Directors that is necessary for the Board of Directors to effectively and reasonably perform its duties. The Board of Directors expressed satisfaction with the evaluation process.

Policy on Directors appointment, remuneration, etc

The Remuneration Policy of the Company for appointment and remuneration of the Directors, Key Managerial Personnels and other employees of the Company along with other related matters have been explained in the Corporate Governance Report forming part of

this Annual Report. Depending on the need to appoint / re-appoint Director, the Nomination and Remuneration Committee (NRC Committee) of the Company determines the criteria based on the specific requirements. NRC Committee, while recommending candidature to the Board, takes into consideration the qualification, attributes, experience and independence of the candidate.

Corporate Governance and Code of Conduct

Pursuant to Regulation 34(3) read with Schedule V(C) of the SEBI Listing Regulations, a separate report on Corporate Governance practices followed by the Company together with the Certificate required under Schedule V(E) of the SEBI Listing Regulations from M/s. Pramod Shah & Associates, Practicing Company Secretaries, confirming compliance by the Company of the conditions of Corporate Governance is annexed as Annexure "2" to this Report.

Certificate of Non-Disqualification of Directors, pursuant to Regulation 34(3) and Schedule V(C) clause (10)(i) of SEBI Listing Regulations, 2015, from M/s. Pramod S. Shah and Associates, Practicing Company Secretaries, forms part of the Report on Corporate Governance.

Pursuant to the provisions of Regulation 17(5)(a) of the SEBI Listing Regulations, your Company has also laid down a Code of Conduct for its Board Members and Senior Management Personnel. All the Directors and the Senior Management Personnel have affirmed compliance with the said Code of Conduct. A declaration by the Managing Director and Group CEO confirming the compliance by Board Members and Senior Management Personnel with the Code of Conduct for the year ended March 31, 2024, forms a part of the Report on Corporate Governance.

Consolidated Financial Statement

The Audited Consolidated Financial Statements was prepared in accordance with the Companies (Indian Accounting Standards) Rules, 2015 (Ind-AS) notified under Section 133 and other applicable provisions of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, as applicable and shows the financial information

of the Company and its Subsidiaries as a single entity, after elimination of minority interest, if any. As required under provisions of the Companies Act, 2013, as applicable, the Audited Consolidated Financial Statements of the Company and all its Subsidiaries together with Auditors Report thereon forms a part of this Annual Report.

Consolidated Revenues for the Year were H6,664 lakhs compared to H4,684 lakhs in the previous year, which comprises Investment Banking and Advisory Fees of H3,090 lakhs, Corporate Advisory Fees of H3,056 lakhs, Gain on Sale of Investment of H21 lakhs, Income from Dividend, Interest and Other Income of H462 lakhs, Net Gain on Fair Value Changes H35 lakhs. Consolidated Net Profit after Tax including Comprehensive Income for the Year under review was H2,921 lakhs as compared to H1,850 lakhs in the previous year.

Subsidiary Companies / Joint Ventures

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 read with the Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing the salient features of the Audited Financial Statements of the Subsidiaries / Associate Companies for the year ended March 31, 2024, is given in Form AOC- 1 as an annexure to the Consolidated Financial Statements of the Company forming part of this Annual Report.

The policy for Determining Material Subsidiaries has been placed on the website of the Company (www.primesec.com). Separate Audited Financial Statements of each of the Subsidiaries are available on the website of the Company (www.primesec.com) and the same will also be made available to the Members seeking such information at any point of time.

The summary of the state of affairs and performance of the subsidiaries is given below:

Prime Research and Advisory Limited

Prime Research and Advisory Limited ("PRAL") operates in the segment of financial services business comprising value-added intermediation services in wealth management and investment advisory, assisting banks and institutional investors in risk assessment, portfolio analysis and portfolio rebalancing through execution of specific strategies. PRALs target clients include corporate treasuries, fund management companies and family offices among others. PRAL through its network of investors substantially enhances our capability to execute mandates. During the year under review, the Board of Directors of PRAL approved an acquisition of 60% equity stake in Prime Global Asset Management Pte. Ltd., a Singapore based Company ("PGAM"). PGAM will undertake the fund management business and offer its services to global institutional investors and family offices. The remaining shareholding of PGAM will be held equally by Mr. Anil Ahuja and Mr. Ajay Abrol, both Singapore residents, who will also act as Directors and operating team of PGAM. The acquisition is subject to execution of definitive documentation, regulatory / statutory approvals as may be required under applicable laws.

During the year under review, PRAL earned revenues of H3,334 lakhs as compared to H1,820 lakhs in the previous year. This includes Advisory Fees of H3,056 lakhs, Income from Dividend, Interest and Other Income of H242 lakhs, Net Gain on Fair Value Changes of H23 lakhs and Gain on Sale of Investment of H13 lakhs. During the year, PRAL earned Net Profit after Tax including Comprehensive Income of H996 lakhs as compared to H336 lakhs in the previous year.

PRAL has declared its maiden dividend of H100 lakhs for the FY 2023-24.

Prime Funds Management Limited

Prime Funds Management Limited ("PFML") was incorporated in 2018 as a 100% subsidiary of the Company to carry on Portfolio Management and setting up Alternative Investments Funds. PFML is yet to commence business.

The Company has not entered into any joint ventures.

Annual Return

Pursuant to the provisions of Section 92(3) of the Companies Act, 2013, the Annual Return of the Company is uploaded on the website of the Company (www.primesec.com).

Related party contracts & arrangements

In accordance with the provisions of the Companies Act, 2013 and the SEBI Listing Regulations, the Company has formulated a Policy on Related Party Transactions and a copy of the same is available on the website of the Company (www.primesec.com). The policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions with related parties and also deals with material related party transactions.

All related party transactions are placed before the Audit Committee for necessary review and approval. Prior omnibus approval of the Audit Committee is obtained for transactions with related parties, which are repetitive in nature and / or are entered into in the ordinary course of business and are on an arms length basis. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company except remuneration and sitting fees.

All transactions entered into by the Company with the related parties during the financial year were in ordinary course of business and are on an arms length basis. Disclosure pursuant to the Accounting Standards on related party transaction has been made in the notes to the Audited Financial Statements. No material related party transactions were entered into during the year by the Company and accordingly, the disclosure of contracts or arrangements with related parties in accordance with the provisions of Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

Deposits

Your Company did not accept any Fixed Deposits under Chapter V of Companies Act, 2013, during this financial year and no amount on account of principal or interest on deposits from the public was outstanding as on March 31, 2024. The Company had no Deposit which was not in compliance with the provisions of Chapter V of the Companies Act, 2013 read with the Companies (Acceptance of Deposit) Rules, 2014.

Directors Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors made the following statements in terms of Section 134(3) (c) and 134(5) of the Companies Act, 2013 that:

a) In the preparation of the Annual Accounts for the year ended March 31, 2024, the applicable Accounting Standards read with the requirements set out under Schedule III to the Companies Act, 2013, have been followed and there are no material departures from the same.

b) They have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2024, and of the profits of the Company for the year ended on that date.

c) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) They have prepared the annual accounts on a going concern basis.

e) They have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively.

f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Corporate Social Responsibility

Pursuant to the provisions of Section 135 of the Companies Act, 2013 read with Schedule VII of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Company has constituted Corporate Social Responsibility ("CSR") Committee. The present Members of the Committee are (i) Mr. Ashok Kacker, Non-Executive and Independent Director (ii) Ms. Smeeta Bhatkal, Non-Executive and Independent Director and

(iii) Mr. Sujit Kumar Karma, Non-Executive and Non-Independent Director. The Company has also formulated CSR Policy and the same is available on the website of the Company (www.primesec.com). Detailed report on CSR activities as required under the Companies Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure "3" to this Report.

Particulars of loans given, investments made, guarantees given and securities provided

Particulars of Loans, Guarantees and Investments made by the Company pursuant to the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Audited Financial Statements forming part of this Annual Report.

Vigil Mechanism / Whistle Blower Policy

The Company established a Vigil Mechanism / Whistle Blower Policy for Directors and Employees to report genuine concerns or grievances about unethical behaviour, actual or suspected fraud or violation of the Companys Code of Conduct, which provides for adequate safeguards against victimisation of persons who avail of such a mechanism. A copy of the Whistle Blower Policy is available on the website of the Company (www.primesec.com).

Auditors and Auditors Report

M/s. Sharp & Tannan Associates, (Firm Registration No. 109983W) Chartered Accountants, have been appointed as Independent Auditors, for a term of Five years, commencing from the Financial Year 2014-25, in place of M/s. Walker Chandiok & Co. LLP, (Firm Registration No. 001076N/N500013) Chartered Accountants, whose term expires at the ensuing Annual General Meeting. A certificate from them has been received, to the effect that their appointment as Independent Auditors of the Company is in accordance with the applicable provisions of Section 139 and 141 of the Companies Act, 2013 and rules framed thereunder, as amended from time to time.

The Report issued by the Statutory Auditor on the Audited Financial Statements of theCompany for Financial Year 2023-24 forms part of this Annual Report and does not contain any qualification, reservation, adverse remark or disclaimer.

Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Rules made thereunder, the Board of Directors has appointed M/s. Pramod Shah & Associates, Company Secretaries (C.P. No. 3804), to undertake the Secretarial Audit for the year ended March 31, 2024. The Secretarial Report given by the Secretarial Auditor is annexed as Annexure "4" to this Report. Your directors confirm that the Secretarial Standards issued by the Institute of Company Secretaries of India have been duly complied with.

Material changes and commitments, if any, affecting the financial position of the company occurred between the end of the financial year to which this financial statements relate and the date of the report

Except as disclosed elsewhere in this Report, no material changes and commitments affecting the financial position of the Company occurred between the end of the Financial Year to which this Financial Statements relate and the date of this Report.

Employees

The disclosures with respect to the remuneration of Directors and Employees as required under Section 197(12) of the Companies Act, 2013 and the Rule 5(1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure "5" to this Report.

The information on Employee particulars as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended) is annexed as Annexure "6" to this Report. In terms of Section 136 of the Companies Act, 2013, the Report and Financial Statements are being sent to the Members and others entitled thereto, excluding the aforesaid

Annexure. Any Member interested in obtaining a copy of the same may write to the Company Secretary.

None of the Employee of the Company is a Relative of any Director of the Company.

Employee Stock Option Schemes

The Company implemented Employee Stock Option Scheme viz Employee Stock Option Scheme 2018 (ESOS 2018). The Nomination and Remuneration Committee of the Board of Directors has granted, to eligible Employees / Directors of the Company and Subsidiary Companies pursuant to ESOS 2018 and 14,11,500 Options are outstanding as of March 31, 2024.

The disclosures in accordance with the provisions of the Section 62(1)(b) of Companies Act, 2013 read with the Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 (as amended from time to time) and the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 are set out as Annexure "7" to this Report. The shares arising out of exercise of the Options will be allotted in the name of the respective Employees and accordingly, the provisions relating to disclosure of voting rights not exercised directly by the employees are not applicable.

Disclosure as per the sexual harassment of women at workplace (prevention, prohibition and redressal) Act, 2013

The Company adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder. As required under law, an Internal Complaints Committee was constituted for reporting and conducting inquiry into the complaints made by the victim on the harassments at the workplace. During the year under review, no complaint of sexual harassment was received and there was no complaint of sexual harassment pending as at the date of this report.

Particulars regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and outgo

In view of nature of business activities of the Company, the particulars regarding conservation of energy and technology absorption, as prescribed under Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, are not given. However, the Company has taken various measures for conservation of energy, like switching from conventional lighting systems to LED lights, etc.

During the year under review, the Companys earnings of foreign exchange of USD 32,580 and expenditure of foreign exchange were USD10,950.

Listing & Listing Fees

The Equity Shares of the Company are listed on the Bombay Stock Exchange Limited and the National Stock Exchange of India Limited and the Listing Fees for the year 2024-25 have been duly paid.

General Disclosures

Your Directors state that during the year under review:

a) The Business Responsibility Reporting as required pursuant to the provisions of Regulation 34(2) of the SEBI Listing Regulations is not applicable to your Company.

b) No Equity Shares with Differential Rights, as to Dividend, Voting or otherwise, were issued.

c) Except the allotment of Equity Shares to employees of the Company pursuant to exercise of Option granted under the Employee Stock Option Scheme 2018, no other Equity Shares (including Sweat Equity Shares) were allotted.

d) The Company did not resort to any buyback of Equity Shares during the Year under review.

e) Managing Director of the Company did not receive any Remuneration or Commission from any of its Subsidiaries.

f) There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and / or Board under Section 143(12) of the Companies Act, 2013 and Rules framed thereunder.

g) No significant or material orders were passed by the Regulators or Courts or Tribunals, which impact the Going Concern status and Companys operations in future.

Acknowledgements

The Board wishes to place on record its sincere appreciation for the hard work put in by the Companys employees at all levels in this difficult environment. The Board of Directors also wish to thank the Companys members, bankers and business associates for their unstinted support during the year.

	For and on behalf of the Board of Directors
Mumbai	N. Jayakumar	Akshay Gupta
April 25, 2024	Managing Director and Group CEO	Whole-time Director