We have audited the accompanying Standalone Financial Statements of IFCI
Limited (“the Company”), which comprises the Balance Sheet as at March
31, 2025, the Statement of Profit and Loss (including Other Comprehensive
Income), the Statement of Cash Flows and the Statement of Changes in Equity
for the year ended on that date and Notes to the standalone Financial Statements,
including a summary of material Accounting Policies and other explanatory
information (hereinafter referred to as the “Standalone Financial Statements”).

In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements give the
information required by the Companies Act 2013 (“the Act”) in the manner so
required and give a true and fair view in conformity with the Indian Accounting
Standards prescribed under Section 133 of the Act read with the Companies
(Indian Accounting Standards) Rules,2015 as amended, (“Ind AS”) and other
accounting principles generally accepted in India, of the state of affairs of the
Company as at 31st March, 2025, and its profit, total comprehensive income, its
cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance
with the Standards on Auditing (SA’s) specified under Section 143(10) of the
Companies Act, 2013 (“the Act”). Our responsibilities under those Standards
are further described in “Auditor’s Responsibilities for the Audit of
Standalone Financial Statements” section of our report. We are independent
of the Company in accordance with the Code of Ethics issued by the Institute
of Chartered Accountants of India (“the ICAI”) together with the ethical
requirements that are relevant to our audit of the standalone financial statements
under the provisions of the Act and the Rules made thereunder, and we have
fulfilled our other ethical responsibilities in accordance with these requirements
and the ICAI’s Code of Ethics. We believe that the audit evidences obtained
by us is sufficient and appropriate to provide a reasonable basis for our audit
opinion on the Standalone Financial Statements.

Emphasis of Matter:

1. We draw attention to Note No. 40 of the Statement, according to which an
in-principle approval has been accorded by the Department of Financial
Services (DFS), Ministry of Finance, Government of India and duly
considered and accorded by the Board of IFCI to consider “Consolidation
of IFCI Group” which entails Merger / Amalgamation of IFCI Limited
with certain group companies at the holding company level or subsidiary
company level.

2. We draw attention to Note No. 40.2 of the financial results regarding
recognition of interest income of Rs. 106.16 crores on stage 3 assets (except
on assets which are standard under IRAC norms) for the FY 2024-25. Since,
there was no expectation of recovery, the same has been written off as bad
debts in the same year. Hence, there is no impact on net profit or loss for the
year.

3. We draw attention to Note No. 39 where the Company reviewed the
methodology for estimating ECL provision on project and corporate loans
which resulted in changes in ECL methodology from portfolio to account
level basis. Estimating ECL provision basis forecasted recovery of loans
on an account level will result in better estimation and presentation of ECL
provision in comparison to estimating ECL provision on portfolio level.
These changes have been considered as change in accounting estimate as
per Ind AS 8 (Accounting policies, change in accounting estimates and
errors) and have been accounted for prospectively with effect from current
financial year. As an effect of these changes, the ECL provision on loans has
increased by Rs. 290.86 crores for the current financial year and accordingly
reducing profit before taxes.

4. The company has informed us vide letter dated 01.11.2022 received from
nodal ministry that case specific data for SDF (Sugar Development Fund)
Scheme may not be shared with auditors. Accordingly, same is not
reviewed by us.

5. The company has informed us that as per communication received from
nodal ministry towards PLI (Production Linked Incentive) schemes, files
and documents shall not be made available to the auditors, hence we have
not reviewed the same.

6. In a certain case, it was observed that one party has appointed the
company as it’s advisor/consultant for assisting and preparation of their
proposal under SDF (Sugar Development Fund) scheme of Government
of India (GOI). However, company is also acting as nodal agency/agent
of government for independently carrying out various due diligence
procedures on application received by nodal ministry under SDF Scheme.
Notwithstanding express approval from GOI, the action of assisting/
coaching an applicant into preparation of documents/project reports on
commercial terms, and simultaneously conducting due diligence on behalf
of GOI, severely undermines the credibility of the proposals appraised by
the company, and comprises the independent position of the company.

7. We draw attention to Note No. 40.1 where the valuation of the investments
in subsidiary companies has been considered on the basis of financial
Statements of the subsidiaries for the period ended 31 December, 2024
instead of 31^st March, 2025.

8. We draw attention to Note No. 54 where the Capital Risk Adequacy Ratio
(CRAR) stands at (-) 23.04% as on 31.03.2025, below the RBI stipulated
guidelines vide circular dated 31st May 2018 (RBI/2017-18/181DNBR
(PD) CC. No. 092/03.10.001/2017-18).

9. We draw attention to Note No. 38 where the provisioning required under
RBI Prudential (IRACP) Norms (including standard assets provisioning)
is higher than impairment allowance under Ind AS 109 by Rs. 74.88 crore.
However, since the existing balance in the impairment reserve stands at
Rs. 104.67 crores, no further Impairment Reserve has been created, as
per the requirements of RBI notification no “DOR (NBFC) CC. PD.
No109/22.10.106/2019-20 dated March 13, 2020. Also, existing impairment
reserve of Rs. 104.67 crores has not been reversed in accordance with the
RBI notification.

Our Opinion is not modified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were
of most significance in our audit of the standalone financial statements of the
current period. These matters were addressed in the context of our audit of the
standalone financial statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters. We have determined
the matters described below to be the key audit matters to be communicated in
our report.

Information other than the Standalone Financial Statements and
Auditor’s Report Thereon

The Company’s Board of Directors and Management is responsible for the
preparation of the other information. The other information comprises the
information included in the Company’s annual report, but does not include
the standalone financial statements, consolidated financial statements and our
auditor’s report thereon.

Our opinion on the standalone financial statements does not cover the other
information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our
responsibility is to read the other information and, in doing so, consider whether
the other information is materially inconsistent with the standalone financial
statements or our knowledge obtained during the course of our audit or otherwise
appears to be materially misstated. If, based on the work we have performed, we
conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.

Management’s Responsibility for the Standalone Financial Statements

The Company’s Board of Directors is responsible for the matters stated in
section 134(5) of the Act with respect to the preparation of these standalone
financial statements that give a true and fair view of the financial position and
financial performance including other comprehensive income, cash flow and
changes in equity of the Company in accordance with the accounting principles
generally accepted in India, including Ind AS specified under section 133 of the
Companies Act, 2013.

This responsibility also includes maintenance of adequate accounting records
in accordance with the provisions of the Act for safeguarding the assets of
the Company and for preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design, implementation
and maintenance of adequate internal financial controls, that were operating
effectively for ensuring the accuracy and completeness of the accounting
records, relevant to the preparation and presentation of the standalone financial
statements that give a true and fair view and are free from material misstatement,
whether due to fraud or error.

In preparing the standalone financial statements, management is responsible for
assessing the company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis of
accounting unless management either intends to liquidate the entity or to cease
operations, or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing the Company’s
financial reporting process.

Auditor’s Responsibilities for the Audit of Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone
financial statements as a whole are free from material misstatement, whether
due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with SAs will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these
standalone financial statements.

As part of an audit in accordance with SA’s, we exercise professional judgment
and maintain professional skepticism throughout the audit. We also:

- Identify and assess the risks of material misstatement of the standalone
financial statements, whether due to fraud or error, design and perform
audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.

- Obtain an understanding of internal financial control relevant to the audit in
order to design audit procedures that are appropriate in the circumstances.
Under section 143(3)(i) of the Companies Act, 2013, we are also responsible
for expressing our opinion on whether the company has adequate internal
financial controls system in place and the operating effectiveness of such
controls.

- Evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures made by

management and Board of Directors.

- Conclude on the appropriateness of management’s use of the going concern
basis of accounting and, based on the audit evidence obtained, whether a
material uncertainty exists related to events or conditions that may cast
significant doubt on the Company’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the standalone
financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the
date of our auditor’s report. However, future events or conditions may cause
the Company to cease to continue as a going concern.

- Evaluate the overall presentation, structure and content of the financial
statements, including the disclosures, and whether the standalone financial
statements represent the underlying transactions and events in a manner that
achieves fair presentation.

Materiality is the magnitude of misstatements in the standalone financial
statements that, individually or in aggregate, makes it probable that the
economic decisions of a reasonably knowledgeable user of the standalone
financial statements may be influenced. We consider quantitative materiality
and qualitative factors in (i) planning the scope of our audit work and in
evaluating the results of our work; and (ii) to evaluate the effect of any identified
misstatements in the standalone financial statements.

We communicate with those charged with governance regarding, among other
matters, the planned scope and timing of the audit and significant audit findings,
including any significant deficiencies in internal control that we identify during
our audit.

We also provide those charged with governance with a statement that we have
complied with relevant ethical requirements regarding independence, and to
communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, related
safeguards.

From the matters communicated with those charged with governance, we
determine those matters that were of most significance in the audit of the financial
statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh
the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2020 (‘the Order’)
issued by the Central Government of India in terms of sub-section (11) of
section 143 of the Act, we give in the Annexure “A” a statement on the
matters specified in paragraphs 3 and 4 of the Order.

2. As required under section 143(5) of the Companies Act, 2013, we enclose
herewith, as per Annexure “B”, our report for the Company on the directions
and sub-directions (Part A and Part B, respectively) issued by the Comptroller
& Auditor General of India.

3. As required by Section 143(3) of the Act, based on our audit we report that:

a) We have sought and obtained all the information and explanations which
to the best of our knowledge and belief were necessary for the purposes of
our audit;

b) In our opinion, proper books of account as required by law have been kept
by the Company so far as it appears from our examination of those books;

c) The Balance Sheet and the Statement of Profit and Loss including other
comprehensive income, the Statement of Cash Flows and Statement of
changes in Equity dealt with by this Report are in agreement with the
books of account;

d) In our opinion, the aforesaid standalone financial statements comply with
the Ind AS specified under Section 133 of the Act.

e) As per notification number G.S.R. 463(E) dated June 5, 2015 issued by
Ministry of Corporate Affairs, Section 164(2) of the Act regarding the
disqualifications of Directors is not applicable to the Company, since it is a
Government Company

f) With respect to the adequacy of the internal financial controls over financial
reporting of the Company and the operating effectiveness of such controls,
refer to our separate report in Annexure “C”. Our report expresses an
unmodified opinion on the adequacy and operating effectiveness of the
Company’s Internal Financial Control over financial reporting.

g) With respect to other matters to be included in the Auditor’s Report in
accordance with the requirements of Section 197(16) of the Act, since it
is a government company, the provision of section 197 of the Act is not
applicable to the company as per GSR 463 (E) dated June 05, 2015, issued
by the Ministry of Corporate Affairs.

h) With respect to the other matters to be included in the Auditor’s Report
in accordance with Rule 11 of the Companies (Audit and Auditors)
Amendment Rules, 2021, in our opinion and to the best of our information
and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations as at
31^st March 2025 on its financial position in its standalone financial
statements - Refer Note No. 35.2 to the financial statements;

ii. The Company has made appropriate adjustment in the Profit & Loss
Account, as required under the applicable law and accounting standards,
for material foreseeable losses, if any, on long-term contracts including
derivative contracts - Refer Note No. 52 to the financial statements;

iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.

iv. a) The Management has represented to us that, to the best of their

knowledge and belief, no funds (which are material either
individually or in the aggregate) have been advanced or loaned
or invested (either from borrowed funds or share premium or
any other sources or kind of funds) by the Company to or in any
other person or entity, including foreign entity (“Intermediaries”),
with the understanding, whether recorded in writing or otherwise,
that the Intermediary shall, directly or indirectly lend or invest in
other persons or entities identified in any manner whatsoever by or
on behalf of the Company (“Ultimate Beneficiaries”) or provide
any guarantee, security or the like on behalf of the Ultimate
Beneficiaries.

b) The Management has represented, that, to the best of its knowledge
and belief, no funds (which are material either individually or
in the aggregate) have been received by the Company from any
person or entity, including foreign entity (“Funding Parties”), with
the understanding, whether recorded in writing or otherwise, that
the Company shall, whether, directly or indirectly, lend or invest
in other persons or entities identified in any manner whatsoever
by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or
provide any guarantee, security or the like on behalf of the Ultimate
Beneficiaries

c) Based on the audit procedures that have been considered reasonable
and appropriate in the circumstances, nothing has come to our
notice that has caused us to believe that the representations under
sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b)
above, contain any material misstatement.

v. There has been no dividend declared or paid by the company during the
year under audit.

vi. Based on our examination, which included test checks, the Company
has used accounting software for maintaining its books of account for
the financial year ended March 31, 2025 which has a feature of recording
audit trail (edit log) facility and the same has operated throughout the
year for all relevant transactions recorded in the software. Further,
during the course of our audit we did not come across any instance
of the audit trail being tampered with. Further, the audit trail has been
preserved by the Company as per the statutory requirements for record
retention.

For S MANN AND COMPANY
Chartered Accountants
Firm Registration No: 000075N

CA SUBHASH CHANDER MANN
Partner

Membership No.: 080500
UDIN: 25080500BMGHFJ1205

Place: New Delhi
Date: May 15, 2025