Dear Shareholders,

The world today, is displaying an unprecedented environment. One of the greatest health threats has profoundly impacted the global economy and all of its citizens. However, as a responsible organisation, we have remained well-prepared to support our customers, people and communities across the country.

Our strong foundation with sustainable business practices, robust risk management and sound governance has helped us seamlessly navigate headwinds during the tough times. We remained future-focused by nurturing the hopes of millions of home aspirants with our affordable home loan offerings and digitised platforms.

The year 2019-20 witnessed various macro-economic headwinds owing to subdued private consumption, lower investments and demand weakness across manufacturing, construction, and real estate sectors. The lingering effects of earlier policy measures, increasing inflation, liquidity challenges in the Non-Banking Financial Services (NBFC) sector, coupled with decline in credit growth further slowed down the overall momentum of the economy. As a result, the GDP growth in FY 2019-20 came down to 4.2% as compared to 6.1% in FY 2018-19.

The Government continued announcing several measures to revive the demand. It included capital infusion into public sector banks to generate additional lending capacity and liquidity, easing FDI rules, corporate tax rate cut and income tax rate cut, among others. The Government also encouraged the real estate sector by announcing last-mile funding for about 1,600 stalled projects at different stages and increasing income tax exemption on housing loans for affordable housing. Further the ‘National Infrastructure Pipeline’ gave the right direction to spur economic activities.

The first half of CY 2020 was dominated by the unexpected pandemic and the consequent lockdown. As a result, the country experienced muted demand and almost stagnant economic activities during the various phases of the lockdown. The housing finance sector also faced liquidity constraints and reduced disbursements. The Government along with the RBI intervened and announced important reforms and economic packages to revive the economic slowdown.

Amid the crisis, we remained resilient underpinned by our strong business model, future-centric strategies and robust technology architecture. Moreover, we are optimistic that the Government’s continuous thrust on affordable housing along with rising disposable income, increase in nuclear families and fiscal incentives on housing loans will catalyse demand in Tier II and III cities in the coming future.

With our shared vision of ‘Complete Profitability’, and fair and transparent policies, we strive to create a secured future for our customers across the country. Despite the challenging scenario, we reported a total loan assets under management of ₹ 184,947 million. The Company benefited 28,900+ customers till date through Swaraj Home Loans, which caters to the needs of informal segment of the society. While we fulfilled the credit needs of small and medium enterprises through our Samman Loan against Property. During the year, the Company has been able to securitise and assign ₹ 28,101 million worth of assets. This is a testimony to our strong credit approval capabilities and robust portfolio quality.

We are focused to play our part in driving financial inclusion by reaching more customers in the tier II tier III cities backed by IIFL Group’s widespread network of 2,377 touch points across the country. We are the preferred housing finance partner for several State Governments and prominent State authorities. Under the Pradhan Mantri Awas Yojana - Credit Linked Subsidy Scheme (PMAY-CLSS), we helped over 38,300 customers avail subsidy benefits worth ₹ 9+ billion. During the year, we also raised ₹ 7,000 million as refinance from National Housing Bank.

As a fintech housing finance player, we are dedicated to make our customers’ journey of owning a home as seamless as possible. Our future-ready technology system helped us continue the business activities smoothly even during the pandemic. With advanced analytical tools and automation, we have made credit underwriting, appraisal and collection processes faster and accurate. Our ‘Jhatpat’ mobile application ensures sanction decisioning within 45 mins. Besides, instant KYC validation, E-signing and easy loan on-boarding has improved efficiency and enhanced customer experience.

The Company is relentlessly building competencies to provide a rewarding career to its employees. Their dedication and tenacity enabled us to continue to serve our customers and the broader societies through a difficult time. As we make the changes to build a stronger foundation for the Company, we continue to recognise and act upon the broader role we play in our communities. We initiated ‘Covid-19 response’ relief programme by distributing essentials and personal care kits to migrant workers and their families at construction sites and also educated them about the preventive measures.

We are committed to create a sustainable impact through Environmental, Social and Governance (ESG) initiatives in line with four Sustainable Development Goals (SDGs) out of the 17 SDGs by the United Nations. Through ‘KUTUMB- an Initiative towards Green Affordable Housing’, we aim to create sustainable green projects. We started a pioneering initiative namely, ‘Green Value Partner’ to assist the developers with the process of Green Building Certification. The Company also conducted awareness campaigns to support Government’s ‘Angikaar’ initiative focusing on social behaviour change for beneficiaries of homes under PMAY (U).

As a sustainable organisation with wide footprint and tailored offerings, I believe IIFL Home Finance is well positioned to deliver the purpose of nurturing home buying aspiration of its customers. I would like to thank my fellow Board members for their wise and invaluable counsel in an increasingly complex environment. On behalf of us all at IIFL Home Finance, I thank our employees, customers, shareholders and stakeholders for their continued faith in our actions. As always, we remain committed to meeting their expectations and creating more value.

Yours sincerely,

Monu Ratra

Chief Executive Officer (CEO)