Year End :2024-03

The Board of Directors ("Board") hereby submits the 24^th Annual Report on the business and operations of One 97 Communications Limited ("Company" or "Our" or "We" or "Paytm") together with the Audited Standalone and Consolidated Financial Statements for the financial year ended March 31, 2024 ("FY 2023-24"). Wherever required, the consolidated performance of the Company and its subsidiary(ies) has also been provided.

Financial Performance

The standalone and consolidated financial highlights of the Company's operations are summarised below:

(Amounts in J Million, except earnings per share)

	Consolidated		Standalone
Particulars	Year ended		Year ended
	March 31,	March 31,	March 31,	March 31,
	2024	2023	2024	2023
Revenue from operations	99,778	79,903	76,608	60,277
Other income	5,469	4,097	5,244	3,994
Total income	105,247	84,000	81,852	64,271
Total expenses	116,446	101,304	94,441	82,199
Loss before share of profit / (loss) of associates / joint ventures, exceptional items and tax	(11,199)	(17,304)	(12,589)	(17,928)
Share of profit/ (loss) of associates / joint	(377)	(125)	-	-
ventures
Loss on impairment of an associate	(2,271)	-	(2,096)	-
Loss before exceptional items and tax	(13,847)	(17,429)	(14,685)	(17,928)
Exceptional items	(57)	-	(77)	(630)
Loss before tax	(13,904)	(17,429)	(14,762)	(18,558)
Income Tax expense	320	336	-	-
Loss for the year	(14,224)	(17,765)	(14,762)	(18,558)
Other comprehensive Income/ (Loss)	1,896	2,082	(93)	(23)
Total Comprehensive Income/ (Loss)	(12,328)	(15,683)	(14,855)	(18,581)
Earnings per equity share of the face value J 1 each (Amount in J)
Basic	(22)	(27)	(23)	(29)
Diluted	(22)	(27)	(23)	(29)

State of Affairs of the Company / Operational Highlights

Your Company continued expansion of its payments and financial services businesses during FY 2023-24. Our payments business is our acquisition engine which brings customers to our platform. We monetize these customers by cross selling various financial & marketing services.

As a result of the Reserve Bank of India (RBI) direction to Paytm Payments Bank Limited ("PPBL") our associate Company, on January 31, 2024, Paytm has become a Third-Party Application Provider ("TPAP") for the UPI channel, partnering with Axis Bank, HDFC Bank, State Bank of India and YES Bank. The Company has transitioned users of the @paytm handle to new bank handles—@pthdfc, @ptaxis, @ptsbi, or @ptyes—ensuring seamless UPI payments. We have now partnered with various banks for existing and new UPI customers and merchants, card acquiring and Bank Identification Number sponsorship for card acceptance offering to merchants, nodal/escrow accounts for merchant fund settlement, FasTag distribution and BBPS. This will open up more long-term monetisation opportunities with the partner banks, given our strong customer and merchant engagement on the platform.

Key aspects of our Company's consolidated performance during FY 2023-24 are as follows:

• The Company achieved its first full year of operating profitability, with EBITDA before ESOP of H 559 Cr (including UPI Incentives), driven by 25% YoY revenue growth and expansion of contribution margin. With recent disruptions, there has been a steady state annualised EBITDA impact of around

H 500 Cr owing to discontinuation of PPBL offerings such as wallet and FasTag. Our average monthly transacting users for the quarter ended March 2024 were 9.6 Cr, up by 7% YoY from 9.0 Cr; driven by variety of use cases that we offer, as mobile payments adoption for consumers and merchants in India continues to grow.

• Subscription services for payment devices, such as Soundbox and POS machines, is also witnessing strong adoption, with 1.07 Cr merchants paying us subscriptions as of March 2024, a significant increase from 68 lakhs as of March 2023.

• Our loan distribution business, in partnership with our lending partners, continues to scale with loans amounting to H 52,390 Cr, a YoY growth of 48%.

• Gross merchandise volume of payments facilitated through our platform for the year ended March 31, 2024 has grown 38% YoY to H 18.34 Lakh Cr from H 13.22 Lakh Cr for the year ended March 31, 2023.

The growth of UPI and other mobile payment methods presents a wealth of untapped opportunities. In March 2024, we received approval from National Payments Corporation of India (NPCI) to participate in UPI as a TPAP under multi-bank model. Our pioneering innovation, Paytm Soundbox, has been groundbreaking for our merchants. Our device has seen a rapid adoption across the country and played a vital role in empowering small and micro-businesses in India. It supports 11 languages including English and Regional Languages. In order to serve the diverse needs of our growing merchant base, we continue to launch innovative products, like Card Soundbox

(enabling merchants to accept mobile and card payments), Pocket Soundbox (a small cardsized device which easily fits in the pocket and is helpful for merchants on the go, including auto drivers, delivery agents, parking fee collectors etc.) and Music Soundbox (allowing merchants to listen to music over Bluetooth speaker, improving their engagement).

During this period, as disclosed on March 1, 2024, Paytm and PPBL undertook additional measures to pursue independent future plans and mutually agreed to discontinue various inter-company agreements with Paytm and its group entities. Also, the shareholders of PPBL have agreed to simplify the Shareholders Agreement to support PPBL's governance. Further, PPBL has reconstituted its Board of Directors to be fully independent, with the appointment of various Independent Directors and a new Chairman. Paytm supports the direction of independent future plans for PPBL and has accordingly withdrawn its nominee from PPBL's Board of Directors. Mr. Vijay Shekhar Sharma has also resigned from the Board of Directors of PPBL to enable this transition.

Dividend

As the Company does not have profits during the year under review, the Board does not recommend any dividend for FY 2023-24.

Further, pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), the Company adopted the Dividend Distribution Policy and the same is available on the website of the Company at https://ir.paytm.com/policies-and-guidelines.

Transfer to Reserves

During the year under review, the details of amount transferred to other reserves (including ESOP Reserve), forms part of note no. 11(b) of the standalone financial statements and note no. 10(b) of the consolidated financial statements of the Company which forms part of the Annual Report.

Particulars of Loans, Guarantees or Investments

The particulars of loans, guarantees and investments as on March 31, 2024, covered under Section 186 of the Companies Act, 2013 ("Act") are given in note nos. 5, 6 and 7 of the standalone financial statements and note nos. 5 and 6 of the consolidated financial statements, which forms part of the Annual Report.

Subsidiaries, Associates and Joint Ventures

In order to meet regulatory requirements (such as separate independent and regulated legal entities e.g. for stock broking or insurance broking, for payment aggregation, and also for our overseas marketing cloud business) and to support our business needs, including those from third party acquisitions integrated within the group over time, the Company has 29 subsidiaries, 10 associates and 3 joint ventures in India and abroad as on March 31, 2024. There was no change in the status of the said subsidiaries, associates & joint ventures during the year under review.

Paytm Payments Services Limited ("PPSL") is a material subsidiary of the Company, engaged in

the business of providing payment aggregator services and payment gateway services in accordance with RBI guidelines and to develop infrastructure including information technology, handling, facilitating, processing and settlement of transactions, customer grievances and dispute between various parties in accordance with Payments and Settlements Systems Act, 2007. The details of PPSL are set out in the Corporate Governance Report, which forms part of the Annual Report.

In compliance with Regulation 16(1)(c) of SEBI Listing Regulations, the Company has formulated a policy for determining material subsidiaries. The said policy is available on the website of the Company at https://ir.paytm. com/policies-and-guidelines.

Pursuant to Section 129(3) of the Act read with Rule 5 of Companies (Accounts) Rules, 2014, a statement containing the salient features of the financial statements of each subsidiary, associate and joint venture in the prescribed Form AOC-1 is annexed as Annexure I to this report. The said statement also provides the details of the performance and financial position of each subsidiary, associate and joint venture.

Copies of the financial statements of the subsidiary companies are available on the website of the Company at https://ir.paytm. com/annual-reports.

Utilisation of Proceeds of Initial Public Offer ("IPO”)

Pursuant to Regulation 32 of the SEBI Listing Regulations read with SEBI Master Circular No. SEBI/HO/CFD/PoD2/CIR/P/2023/120 dated July 11, 2023, the Company confirms that during FY 2023-24, there was no deviation or

variation in the utilization of proceeds of IPO from the objects stated in the Prospectus dated November 11, 2021.

The Monitoring Agency Reports for such utilization were received by the Company from Axis Bank Limited, its Monitoring Agency on quarterly basis affirming no deviation or variation in utilization of the issue proceeds from the objects stated in Prospectus and are submitted to the Stock Exchanges. Details on actual utilization of the Net IPO proceeds are given in note no. 38 of the standalone financial statements and note no. 43 of the consolidated financial statements, which forms part of the Annual Report.

Employees Stock Option Schemes

The Company grants share-based benefits to eligible employees with a view to attract and retain talent, align individual performance with the Company's objectives and promote increased participation by them in the growth of the Company.

The Company has two Employees Stock Option Schemes viz. One 97 Employees Stock Option Scheme 2008 (“ESOP 2008") and One 97 Employees Stock Option Scheme 2019 (“ESOP 2019"). After the institution of ESOP 2019, which has been effective from September 30, 2019, no fresh options have been granted to employees under ESOP 2008.

Post IPO of equity shares of the Company, ESOP 2019 has been ratified confirmed and amended, as per the requirements of Regulation 12(1) of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (“SEBI SBEB Regulations 2021"), by the Members of the Company through Postal Ballot on February 19, 2022.

A statement containing relevant disclosures pursuant to Regulation 14 of the SEBI SBEB Regulations 2021 is available on the website of the Company at www.paytm.com/ investor-relations/agm.

During the year under review, the Company has issued and allotted 1,625,556 (Sixteen Lakhs Twenty Five Thousand Five Hundred and Fifty Six) equity shares of H 1/- each to its employees pursuant to exercise of vested options by the eligible employees under ESOP 2008 and ESOP 2019. As on March 31, 2024, the issued, subscribed and paid-up capital of the Company stood at H 635,413,773/- (Sixty Three Crores Fifty Four Lakhs Thirteen Thousand Seven Hundred Seventy Three) comprising 635,413,773 equity shares of H 1/- each. The equity shares issued under the said Schemes rank pari-passu with the existing equity shares of the Company.

The Company has obtained a certificate from M/s. PI & Associates, Secretarial Auditors of the Company, (Firm Registration No.: P2014UP035400) confirming that ESOP 2008 and ESOP 2019 have been implemented in accordance with the SEBI SBEB Regulations 2021 and resolution(s) passed by the Members of the Company. The said certificates will be made available for inspection by the Members electronically during the 24^th Annual General Meeting ("AGM").

Transactions with Related Parties

The Company has adopted a Policy on Related Party Transactions ("RPT Policy") in compliance with Regulation 23 of the SEBI Listing

Regulations. During the year under review, the Board on the recommendations of the Audit Committee reviewed and amended the RPT Policy in its meeting held on July 21, 2023, to incorporate certain amendments in the SEBI Listing Regulations. The RPT Policy is available on the website of the Company at https://ir.pavtm. com/policies-and-guidelines. All the transactions with related parties entered into by the Company during FY 2023-24 were on an arm's length basis and in the ordinary course of business & in the best interest of the Company. The Company had also engaged independent consultants, wherever necessary, to review and confirm that the transactions were undertaken on an arms' length and at prevailing market rate. The said transactions were entered into by the Company with the prior approval of the Audit Committee.

During the year under review, the Company entered into material related party transactions with PPBL for which prior approval of the Audit Committee was obtained and the same was also approved by the Members of the Company, through Postal Ballot, on March 23,

2023. The particulars of material contracts/ arrangements with related parties in Form AOC-2 as required under Section 134(3)(h) of the Act, is annexed as Annexure II to this report.

In view of termination of various agreements by the Company with PPBL during March

2024, we do not expect the transactions with PPBL to be material related party transactions going forward.

For further details of related party transactions during FY 2023-24 please refer to note no. 25 of the standalone financial statements and note no. 26 of the consolidated financial statements which forms part of the Annual Report.

Directors and Key Managerial Personnel

Directors

As on March 31, 2024, the Board comprise of 7 (seven) Directors with an appropriate mix of Executive Directors, Non-Executive Non-Independent Director and Non-Executive Independent Directors in compliance with the applicable provisions of the Act and the SEBI Listing Regulations. The Board of the Company consists of eminent individuals of diverse backgrounds with skills, experience and expertise in various areas as detailed in the Corporate Governance Report, which forms part of the Annual Report.

Mr. Ravi Chandra Adusumalli (DIN : 00253613), Non-Executive Non-Independent Director of the Company, retires by rotation and being eligible, offers himself for re-appointment at the ensuing AGM.

Subsequently, after closure of FY 2023-24 Mr. Rajeev Krishnamuralilal Agarwal (DIN: 07984221) was appointed as an additional Director in the capacity of Non-Executive Independent Director of the Company by the Board, at its meeting held on June 17, 2024 basis the recommendation of the Nomination and Remuneration Committee, subject to approval of the Members of the Company.

All Directors of the Company have confirmed that they meet all the requirements to act as a Director of the Company in accordance with the provisions of the Act and the SEBI Listing Regulations.

Mr. Vivek Kumar Mathur (DIN: 03581311), ceased to be an Alternate Director to Mr. Ravi Chandra Adusumalli w.e.f. June 30, 2023 as there was no requirement for an alternate director to Mr. Ravi Chandra Adusumalli.

Mr. Neeraj Arora (DIN: 07221836), NonExecutive Independent Director has tendered his resignation from the directorship of the Company w.e.f. June 17, 2024 due to his pre-occupation and other personal commitments. He has also confirmed that there are no material reasons for his resignation other than those mentioned.

The Board places on record its appreciation for the contribution made by Mr. Neeraj Arora and Mr. Vivek Kumar Mathur, during their tenure as Directors of the Company.

Key Managerial Personnel

The Board at its meeting held on July 21, 2023, has approved the appointment of Mr. Sunil Kumar Bansal (ICSI Membership No.: F4810) as the Company Secretary and Compliance Officer of the Company w.e.f. July 21, 2023. Consequent to the said appointment, Ms. Sonali Singh, Company Secretary (ICSI Membership No.: A26585) who was appointed as an Interim Compliance Officer of the Company w.e.f. March 15, 2023, ceased to be the Interim Compliance Officer of the Company w.e.f. July 21, 2023.

Pursuant to the provisions of Section 203 of the Act, Mr. Vijay Shekhar Sharma, Chairman, Managing Director and Chief Executive Officer, Mr. Madhur Deora, Executive Director, President and Group Chief Financial Officer and Mr. Sunil Kumar Bansal, Company Secretary and Compliance Officer are the Key Managerial Personnel of the Company as on March 31, 2024.

Declaration by Independent Directors

The Company has received declarations from all the Independent Directors confirming that they continue to fulfill the criteria of independence in accordance with Sections 149, 150 read with Schedule IV of the Act and Regulation 16 and 25 of the SEBI Listing

Regulations. All Independent Directors have affirmed compliance with the Code of Conduct for Independent Directors as prescribed in Schedule IV to the Act.

Further, in the opinion of the Board, the Independent Directors of the Company possess requisite expertise and experience including proficiency and hold high standards of integrity to discharge their duties with independent judgment.

Corporate Social Responsibility (“CSR")

In view of the losses incurred by the Company during the previous financial years, the Company was not required to contribute towards CSR activities during FY 2023-24. However, the Company had voluntarily undertaken certain initiatives during the year under review which were approved by the CSR Committee. A brief outline of the CSR policy of the Company and the activities undertaken during the year are set out in Annexure III to this report in the format as prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014.

The CSR Policy as adopted by the Company is available on the website of the Company at https://ir.paytm.com/policies-and-guidelines.

For details regarding the composition and terms of reference of the CSR Committee, please refer to the Corporate Governance Report, which forms part of the Annual Report.

Board Meetings

The Board met 9 (nine) times during FY 202324. The details of the meetings of the Board and attendance of the Directors at the Board meetings are set out in the Corporate Governance Report,

which forms part of the Annual Report. The intervening gap between two consecutive Board meetings was within the period prescribed under the provisions of Section 173 of the Act and SEBI Listing Regulations.

Board Committees

As on March 31, 2024, the Board had the following Committees:

(i) Audit Committee

(ii) Nomination and Remuneration Committee

(iii) Stakeholders Relationship Committee

(iv) Risk Management Committee

(v) Corporate Social Responsibility Committee

(vi) Investment Committee

The details of composition, terms of reference and number of meetings held during the year and the attendance of the Committee members at each meeting are given in the Corporate Governance Report, which forms part of the Annual Report.

During the year under review, the IPO Committee and the Buy-back Committee were dissolved by the Board w.e.f. July 21, 2023.

Report on Corporate Governance

In compliance with Regulation 34 read with Schedule V of the SEBI Listing Regulations, the Report on Corporate Governance of the Company, forms part of the Annual Report.

A certificate from the Chairman, Managing Director and Chief Executive Officer and the Executive Director, President and Group Chief Financial Officer of the Company in terms of Regulation 17 of the SEBI Listing Regulations, inter-alia, confirming the correctness of the

financial statements and cash flow statements, adequacy of the internal control measures and reporting of matters to the Audit Committee, also forms a part of the Annual Report.

Directors' Responsibility Statement

Pursuant to clause (c) of sub-section (3) of Section 134 of the Act, it is confirmed that:

a) in 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 FY 2023-24 and of the loss 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 frauds and other irregularities;

d) the Directors had prepared the annual accounts on a going concern basis;

e) the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f) 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.

Policy on Appointment and Remuneration

The Board has framed and adopted a Nomination, Remuneration and Board Diversity Policy ("NR Policy") in terms of Section 178 of the Act and Regulation 19(4) read with Part D of Schedule II of the SEBI Listing Regulations, for identification, selection and appointment of Directors, Key Managerial Personnel ("KMPs") and Senior Management Personnel ("SMPs") of the Company. The Policy lays down the process and parameters for the appointment and remuneration of the KMPs and other SMPs and the criteria for determining qualifications, highest level of personal and professional accomplishments, age, experience of industry and such other factors that the Committee might consider relevant and applicable from time to time towards. During the year under review, the NR Policy was amended to broaden the components of remuneration and also link it with individual's performance and with the Company's performance. The NR Policy is available on the website of the Company at https://ir.paytm.com/policies-and-guidelines.

Board Evaluation

Pursuant to the provisions of the Act and the SEBI Listing Regulations, an evaluation process was carried out to evaluate performance of the Board and its Committees, the Chairman of the Board and all Directors, including Independent Directors. The evaluation is aimed at improving the effectiveness of all these constituents and enhancing their contribution to the functioning of the Board. The questionnaire for this evaluation was developed based on improvement areas identified last year by the Nomination and Remuneration Committee. The

results of evaluation of the Board and its various Committees were subsequently discussed at their respective meetings and the areas for improvement of the functioning of the Board and Committees were duly noted.

In a separate meeting of the Independent Directors, performance of the Non-Independent Directors, the Chairman of the Board and the Board as a whole were also discussed.

Business Responsibility and Sustainability Report

In compliance with Regulation 34 of the SEBI Listing Regulations read with SEBI Master Circular No. SEBI/HO/CFD/PoD2/CIR/P/2023/120 dated July 11, 2023, the Business Responsibility and Sustainability Report of the Company for FY 2023-24 describing the various initiatives undertaken from an environment, social and governance perspective during FY 2023-24 forms part of the Annual Report.

The Company had voluntarily engaged TUV India Private Limited ("TUVI") to conduct independent external assurance of BRSR for FY 2023-24. The Independent Assurance Statement on Business Responsibility & Sustainability Reporting by TUVI, forms part of the Annual Report.

Management Discussion and Analysis Report

The Management Discussion and Analysis Report for FY 2023-24 on Company's performance, industry trends and other required details prepared in compliance with Regulation 34 of the SEBI Listing Regulations, forms part of the Annual Report.

Annual Return

The Annual Return of the Company in form MGT-7 as required under Section 92 and Section 134 of the Act read with rules made thereunder is available on the website of the Company at https://ir.paytm.com/agm.

Internal Auditors and Internal Financial Controls

The Company has appointed M/s Grant Thornton Bharat LLP (LLP Identification No.: AAA-7677) and M/s Protiviti India Member Private Limited (CIN: U93000HR2009PTC057389) as an

Independent Joint Internal Auditors under Section 138 of the Act for FY 2023-24. In addition, the Company has also established an in-house Internal Audit department to supervise Internal Audit function. The head of Internal Audit also reports directly to the Audit Committee.

The Board had approved the appointment of M/s PricewaterhouseCoopers Services LLP (LLP Identification No.: AAI-8885) as an Internal Auditor for FY 2024-25, basis recommendation of the Audit Committee.

Internal Audit function is governed by the Internal Audit Charter and Internal Audit Manual approved by the Audit Committee. Internal Audit scope, Internal Audits / reviews along with an update on remediation status are submitted and presented in the quarterly Audit Committee meeting.

Internal Financial Control and their adequacy

The Company has laid down adequate internal financial controls commensurate with the scale and size of the operations of the Company. The

Company has in place adequate policies and procedures for ensuring the orderly and effective control of its business, including adherence to the Company's policies, safeguarding its assets, prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has an adequate system of internal control commensurate with its size and nature of business. These systems provide a reasonable assurance in respect of providing financial and operational information, safeguarding assets of the Company, adhering to the management policies besides ensuring compliance.

Human Resource Management and Related Disclosures

Prevention of Sexual Harassment ("POSH") at Workplace

The Prevention of Sexual Harassment at Workplace ("POSH Policy") has been formed under the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act"), to prohibit, prevent or deter the commission of acts of sexual harassment at workplace and to provide the procedure for the redressal of complaints pertaining to sexual harassment. The Company has also constituted an Internal Complaints Committee ("ICC") as per the requirements under the POSH Act. All the existing employees and any new joiner undergoes a mandatory training on POSH every financial year.

The ICC ensures that all cases reported are resolved in a timely manner, in accordance with the POSH Act. We also conduct awareness

programs for employees on the POSH Policy. The Company organizes several virtual seminars on POSH to ensure awareness and training in accordance to the guidelines laid in the POSH Policy.

The POSH Policy is available on the website of the Company at https://ir.paytm.com/ policies-and-guidelines

A detailed disclosure on POSH has been provided in the Corporate Governance Report, which forms part of the Annual Report.

During FY 2023-24, no complaint was received. 1 complaint pending for closure from the previous year 2022-23 (which was reported in March 2023) was resolved & closed during FY 2023-24.

Particulars of Employees

The statement containing disclosure of remuneration under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is given in Annexure IV forming a part of this report.

Further, the information as per Rule 5(2) and Rule 5(3) of the above-mentioned Rules pertaining to the names of top ten employees and other particulars of employees is provided in a separate annexure. However, as per the provisions of Section 136(1) of the Act and the rules thereunder, the Annual Report and the financial statements, excluding the aforesaid annexure, are being sent to the Members, and other persons entitled thereto. Any Member interested in obtaining a copy of the same may write to the Company Secretary and Compliance Officer at [email protected].

Risk Management

The Company has a robust Risk Management Framework to identify and evaluate business risks and opportunities. This framework includes appropriate policies and procedures that seek to create transparency, minimize adverse impact on the business objectives and enhance the Company's competitive advantage. The business risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. The framework has risk scorecards and risk dashboards which help in identifying risks trend, exposure and potential impact analysis at a Company level and for business segments. The Company has identified various risks and also has mitigation / monitoring plans for each risk identified. The Risk Assessment and Management Policy is available on the website of the Company at https://ir.paytm. com/policies-and-guidelines.

The Company's insurable assets like server, computer equipments, office equipments, furniture & fixtures etc. have been adequately insured against major risks. The Company has also taken Directors' & Officers' Liability Insurance Policy to protect the Company, Directors and Officers from unexpected exigencies. The Risk Management Committee of the Board has been constituted to periodically review the Risk Management framework and approve the necessary changes required therein.

Vigil Mechanism/ Whistle Blower Mechanism Policy

The Company has adopted a Vigil Mechanism/ Whistle Blower Mechanism Policy ("Policy") with protective clauses for the whistle blowers. The

Policy provides adequate safeguards against victimization of whistle blowers and provides direct access to the Chairman of the Audit Committee, in exceptional circumstances.

The Policy provides for a mechanism to report concerns about unethical behavior, actual or suspected fraud, instances of leak of Unpublished Price Sensitive Information or violations of your Company's Code of Conduct. The detailed disclosure is given in the Corporate Governance Report, which forms part of the Annual Report.

The Policy is available on the website of the Company at https://ir.paytm.com/ policies-and-guidelines.

Foreign Exchange Earnings and Outgo

The Foreign Exchange earnings and outgo during FY 2023-24, is as follows:

(Amounts in f Million)

Particulars	FY 2023-24	FY 2022-23
Foreign Exchange	534.82	308.98
Earnings
Foreign Exchange Outgo
Opex:	1,867.36	2,786.63
Capex:	204.46	1,264.30
Total	2,071.82	4,050.93

Auditors and Auditor's Report

Statutory Auditors

M/s S.R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration no. 101049W/ E300004), were appointed as the Statutory Auditors of the Company at the AGM held on September 12, 2023, for a term of 5 (five) consecutive years from the conclusion of 23^rd AGM till the conclusion of 28^th AGM of the Company.

The Report given by the Statutory Auditors on the standalone financial statements of the Company and the consolidated financial statements of the Company for the financial year ended March 31, 2024, forms part of the Annual Report. There has been no qualification, reservation, adverse remarks or disclaimer given by the Statutory Auditors in their Report which calls for any explanation.

Secretarial Auditors

M/s PI & Associates, Practicing Company Secretaries (Firm Registration No.: P2014UP035400), carried out the Secretarial Audit for FY 2023-24 in compliance with the Act, rules made thereunder, and the SEBI Listing Regulations, as Secretarial Auditors of the Company for FY 2023-24. The Secretarial Auditors' Report is enclosed as Annexure V to this report.

In compliance with Regulation 24A of the SEBI Listing Regulations, the Secretarial Audit Report of PPSL, a material subsidiary of the Company for FY 2023-24 issued by M/s. PI & Associates, Practicing Company Secretaries is enclosed as Annexure VI to this report.

The Secretarial Audit Report of the Company and its unlisted material subsidiary does not contain any qualification, reservation, adverse remark or disclaimer.

Conservation of Energy and Technology Absorption

Energy Conservation:

The Company's operations are not energy intensive. However, the Company has implemented various energy conservation measures, such as adopting good practices in all major offices for energy conservation like

the use of LED lights, ban on one-time use plastic, energy-efficient appliances, sensor-based water faucets and sensor-based lighting systems in toilets.

The corporate office building of the Company is an Indian Green Building Council Platinum certified building and is primarily focused on developing sustainable sites, increased water and energy efficiency, reduced waste and emissions, use of eco-friendly building materials, and improving indoor environmental quality more efficiently than conventional designs like energy-efficient windows, LED lighting, energy-efficient appliances, geothermal heat pumps, and energy efficient insulation.

Further, in most of our facilities, VRV/VRF air-conditioned systems are installed that are second generation energy efficient products. We have also installed VAV controllers in all meeting rooms & floors to maintain the required cooling as per floor occupancy, which ultimately reduces the overall load of the air handling unit and chiller. Heat resistant facade glasses have been installed all across the building that restricts the heat & maintains the temperature on the floor, which also facilitates the natural light throughout the day. All electrical appliances that we are sourcing for the office are 5* (star) rated for higher energy efficiency. We have a BMS (Building Management System) for controlling and monitoring energy conservation.

The other conservation measures undertaken by the Company during FY 2023-24 are mentioned in the Business Responsibility and Sustainability Report, which forms part of the Annual Report.

Update on Technology Absorption

We expanded our hugely successful Paytm Soundbox and have invested heavily in our

Made-in-India loT devices. This year, we launched Pocket Soundbox, Music Soundbox and Card Soundbox enabled with 4G technology, completely designed and made in India to benefit and cater every segment of the merchants.

Our latest innovation Card Soundbox has become India's first Soundbox with card payments, which will empower merchants to accept both mobile and card payments across all Visa, Mastercard, Amex and RuPay networks. It accepts payments with a simple 'Tap & Pay' and by scanning the QR. It is expanding payment acceptance for merchants by combining Soundbox with NFC or contactless debit and credit card payments with mobile payments.

This year, we prioritized technology development to enhance our development processes and deliver exceptional customer experiences. We integrated Generative AI tools like CoPilot to empower our developers. This resulted in increased productivity and faster development cycles.

In a continuous effort to revolutionise the mobile payment landscape by building in India and for India, some of the other major innovations by us in the year 2023 include Paytm AI Router, bond investing on Paytm Money, Split-bill feature, and pin favourite contact feature. Our R&D design and software capabilities are amongst the best in the world. We are constantly building various GenAI and big data features that enhance payment trust when consumers or merchants use Paytm. Acknowledging the importance of GenAI in today's era, we are taking steps to leverage its full benefit.

The details of our expenses linked to strengthening and expanding our technology platform are provided in the notes of our

standalone financial statements, which form a part of the Annual Report.

The other details of our technology-led innovation are mentioned in the Management Discussion and Analysis Report, which forms part of the Annual Report.

The details on benefits and savings from our technology are mentioned in the Business Responsibility and Sustainability Report, which forms part of the Annual Report.

Awards and Recognitions

During FY 2023-24, the Company received multiple awards and recognition. Details in respect of such awards and recognition received by the Company are available on the website of the Company at https://ir.paytm.com/awards.

Secretarial Standards

The Company complies with all applicable secretarial standards issued by the Institute of Company Secretaries of India in terms of Section 118(10) of the Act.

Other Statutory Disclosures

No disclosure or reporting is made with respect to the following items, as there were no transactions during FY 2023-24:

• The issue of equity shares with differential rights as to dividend, voting or otherwise;

• Issue of equity shares (including sweat equity shares) to employees of the Company under any scheme except Employees' Stock Options Schemes referred to in this Report;

• In terms of the provisions of Section 73 of the Act read with the relevant Rules of the Act, the Company had no opening or closing balances

and also has not accepted any deposits during the financial year under review and as such, no amount of principal or interest was outstanding as on March 31, 2024;

• No fraud under Section 143 (12) of the Act has been reported by the Auditors to the Audit Committee or the Board or Central Government;

• The Company does not have any scheme or provision of money for the purchase of its own shares by employees or by trustees for the benefits of employees;

• There was no change in the nature of business;

• There were no material changes and commitments affecting financial position of the Company between the end of the financial year and the date of this report;

• There is no proceeding pending under the Insolvency and Bankruptcy Code, 2016;

• There was no instance of one-time settlement with any Bank or Financial Institution;

• Executive Directors of the Company have not received any remuneration or commission from any of its subsidiaries;

• There was no revision in the

financial statements;

• There are no significant or material orders were passed by the regulators or courts or tribunals which impact the going

concern status of the Company and its operations in future;

• The Company is not required to maintain cost records under Section 148 of the Act; and

• The Company has not made any downstream investments during the year under review and a certificate from the Statutory Auditors has been obtained in this regard;

• There was no instance wherein the Company failed to implement any corporate action within the statutory time limit; and

• The Company has not made any political party contribution under Section 182 of the Act.

Cautionary Statement

Statements in this Report describing the Company's objectives, expectations or predictions may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement(s).

Acknowledgement

The Board is grateful for the continued support provided by our valued customers, investors, government, regulatory authorities and other stakeholders. The Board appreciates the hard work and exemplary dedication of the employees of our Company for showing remarkable teamwork during FY 2023-24.

For and on behalf of the Board One 97 Communications Limited

Vijay Shekhar Sharma

Date: June 17, 2024 Chairman, Managing Director and Chief Executive Officer

Place: Noida DIN: 00466521