Dear Shareholder,

Let me begin with a tribute to Madhur Bajaj who passed away on 11 April 2025. He was until recently a director of Bajaj Finserv and other Bajaj group companies for over three decades. We will miss his valuable support which we had during his long association with the group.

Your Company’s vision is to be a diversified yet integrated financial services entity with a pan-India presence and offer lifecycle financial solutions for its various customers.

The needs of all customers across their financial lifecycle ideally involve five phases:

1) Asset acquisition: These are assisted through loans (be these personal, home and commercial).

2) Asset protection: This is carried out through general insurance policies.

3) Family health and income protection: These are done using general, health and life insurance, guaranteed savings and digital access to the health ecosystem.

4) Investment and wealth management: These are provided through unit-linked investment products (ULIPs), mutual funds, fixed deposits and shares.

5) Retirement: This is met by annuities.

These needs are provided by companies through omnichannel (a) products and solutions, and (b) digital‑first platforms. Within your Company, these are:

a) Products and solutions, provided by:

1. Bajaj Finance Ltd. (BFL), a large, listed, well-recognised and significantly profitable consumer finance and lending business in which BFS holds 51.39% stake; and its listed subsidiary, Bajaj Housing Finance Ltd. (BHFL) in which BFL holds 88.75% stake.
2. Bajaj Allianz General Insurance Company Ltd. (BAGIC); and Bajaj Allianz Life Insurance Company Ltd. (BALIC). These are unlisted joint ventures with Allianz SE of Germany, the global insurance and asset management company. In each of these companies, BFS holds 74% stake.
3. Bajaj Finserv Asset Management Ltd. (BFS AMC), an unlisted wholly-owned subsidiary of BFS. It is in the mutual fund business and offers host of innovative investment products and solutions.

b) Digital-first platforms, offered via:

1. Bajaj Finserv Direct Ltd. (BFSD), an unlisted subsidiary in which BFS holds 80.10% stake with the remaining 19.90% held by BFL. BFSD operates a financial products marketplace and offers technology services;
2. Bajaj Finserv Health Ltd., a health-tech venture, in which BFS holds 100% stake; and
3. Bajaj Financial Securities Ltd. (BFSL), another wholly-owned subsidiary of BFL which provides digital stock-broking and demat services.

What is role of Bajaj Finserv across all these companies?

While it may still look to some of you that Bajaj Finserv (BFS) is like a holding company, it is much more than that. At the risk of repetition, let me clearly reiterate that the fundamental rationale of BFS is to continuously integrate the various companies under its wing — both directly and increasingly digitally — and, by doing so, enhance customer experience in ways such that the aggregate becomes larger than the sum of its parts.

Bajaj Finserv’s role hence is to regularly monitor and engage with its companies with some key objectives:

• Be the preferred partner for all financial lifecycle needs of customers.
• Create constant value across the customer lifecycle.
• Build maintainable businesses to deliver long-term sustainable profit, meaningful market share and effectively use capital — and so deliver superior shareholder returns.
• Be a place where innovation, agility and ownership thrives, thus creating great leaders who build long-term businesses to delight customers.
• Focus on regulatory compliances proactively in letter and spirit.

Your Company’s monitoring and engaging roles are under six heads:

1. Business and strategy: Rigorous engagement in long range planning and annual operating plans; regular review of all businesses and their SBUs; and periodic analysis of new business opportunities as well as strategic investments.
2. Risk management: Harmonisation of risk policies and framework; regular engagement with the Chief Risk Officers of the businesses; periodic review of top enterprise risks including credit, business, financial, operational, reputational, as well as the mitigation actions planned; and driving risk-related projects across the group.
3. Collaboration and best practices: These involve group knowledge forums covering analytics, technology, investments, governance, and the like; cross-company projects on data, innovation and digital strategy; and a stress identification forum to identify any cross-functional view on investment risks across the group.
4. People/HR: The notion of ‘One Finserv’ which translates to group talent mobility; group young leader management trainee programmes; 30 Under 30 programme; and a merit-based remuneration plan combining fixed cash, annual bonus and ESOPs.
5. Customer experience, investments and ESG: To define customer service protocols for businesses; to review and standardise investment processes; and to provide oversight of Environment, Social and Governance (ESG) policy and its implementation across the group.
6. Corporate social responsibility (CSR): To harmonise the CSR efforts of the businesses in a focused manner with aligned goals so as to optimise impact on the beneficiaries.

Let me now take you through the key financial results for FY2025 of the enterprises that constitute your Company.

With respect to the established companies, in the lending business –

Bajaj Finance Ltd. (BFL), on consolidated basis surpassed assets under management (AUM) of ` 400,000 crore and a customer franchise of over 100 million. Profit after tax (PAT) grew by 15% to ` 16,638 crore, delivering a return on average assets (ROA) of 4.6% and return on average equity (ROE) of 19.2%. The loan provisioning for the year was higher at ` 7,966 crore, up from ` 4,631 crore in FY2024 on account of model redevelopment, macro-level deterioration, increasing leverage on unsecured loans and increased AUM.

Bajaj Housing Finance Ltd. (BHFL), a subsidiary of BFL, got listed on the equity segment of the National Stock Exchange and the Stock Exchange, Mumbai (BSE) with an IPO of ` 6,560 crore. BHFL saw its AUM increase by 26% to ` 114,684 crore and PAT by 25% to ` 2,163 crore.

Bajaj Financial Securities Ltd. (BFSL), again a subsidiary of BFL providing digital stock broking services ended the year with a customer franchise of 979,000 and PAT growth of 148% to ` 139 crore.

On the insurance businesses –

Your Company signed Share Purchase Agreements to acquire the 26% interest owned by Allianz SE in Bajaj Allianz General Insurance Company (BAGIC) and Bajaj Allianz Life Insurance Company (BALIC). This will increase the Bajaj group’s ownership in BAGIC and BALIC to 100%. The agreed consideration for 26% stake in BAGIC is ` 13,780 crore and in BALIC it is ` 10,400 crore, totalling ` 24,180 crore. These acquisitions are subject to necessary regulatory approvals. This I believe is one of the largest deals in the financial services space in the recent times and indicates our commitment to the insurance ventures and the financial services sector in India.

Coming to Bajaj Allianz General Insurance Company Ltd. (BAGIC), the Company continues to be the 3rd largest general insurer, measured by gross direct premium, ahead of three public sector insurers of significantly longer vintage. Gross written premium (GWP) for FY2025 stood at ` 21,583 crore with a growth of 5%. Excluding tender driven business of crop and government health insurance, BAGIC’s growth was 8%. Growth for the industry was impacted by the change in accounting for long‑term products. BAGIC’s market share in the industry, including standalone insurers, was 7.2% in FY2025. PAT was ` 1,832 crore with a growth of 18%.

Bajaj Allianz Life Insurance Company Ltd. (BALIC), maintained its market share at 5.9% on Individual rated new business (IRNB) premium with a growth of 12%. Gross written premium (GWP) for BALIC increased by 18% to ` 27,160 crore. The Value of new business (VNB), which is a measure of profitability of the business written in FY2025, was ` 1,152 crore, a growth of 9%. The AUM was at ` 123,734 crore with a PAT of ` 508 crore.

Let me now move to the emerging businesses –

Bajaj Finserv Direct Ltd. (BFSD) recorded a revenue of ` 598 crore and turned cash positive during the year.

Bajaj Finserv Health Ltd. (Bajaj Finserv Health) recorded a consolidated revenue of ` 892 crore and has worked on integrating Vidal Healthcare to deliver unified services.

Bajaj Finserv Asset Management Ltd. (BFS AMC) achieved an impressive milestone with an AUM of ` 20,365 crore as on 31 March 2025, within two years of start of operations.

Finserv, on consolidated basis posted an all-time high financial performance.

• Consolidated revenue of ` 133,822 crore.
• Consolidated profit after tax (PAT) of ` 8,872 crore.

Continuing the strong tradition of giving back, the Bajaj group announced Bajaj Beyond - an initiative which commits ` 5,000 crore impacting over two crore Indians over the next five years, with a focus on skilling.

Let me now touch upon your Company’s employability initiative which I closely identify with. This is the Skillserv Initiative under Bajaj Beyond wherein we are bringing our expertise of our Industry to create and deliver skilling programmes to bridge the skill gap. Our flagship offering – CPBFI (Certificate Programme in Banking, Finance and Insurance) aims to bridge this gap by providing comprehensive skills training in the BFSI domain. This 120-hour programme seeks to equip the youth with industry relevant skills. Notably, 68% of participants are first-generation graduates, predominantly young aspirants from tier 2 or 3 cities, of whom some 61% are women.

CPBFI has trained over 100,000 students since inception and 46,807 students in FY2025 alone, spanning over 161 districts and 23 states in India.

Skillserv has expanded its range of BFSI offerings beyond CPBFI by piloting new offerings in the space of insurance, gold loans and micro finance. We are also building our library of digital programmes. Over time we will build an ecosystem of such offerings, leveraging our expertise and providing the opportunity to skill and upskill and thereby create economic and social opportunities for our citizens.

This is an important initiative of Bajaj group continuing its focus of giving back to society.

Thank you as always for your support to BFS. And my thanks to each and every employee of the group to deliver the kind of results that you see today.

Yours sincerely,

Sanjiv Bajaj

Chairman & Managing Director