10.

11.

Further, our credit monitoring and risk management policies and procedures may not be properly designed, compliant with
applicable directives, or effective or appropriately implemented or complied with by our customers, and we could suffer
material credit losses. While we try to ensure adherence to our internally developed credit monitoring and risk management
policy framework, our customers may, at times, not be able to provide us with requisite or complete information required
in connection with our loan products, which may affect our customer on-boarding procedures. In addition, even if our
policies and procedures are effective and properly implemented, we may not be able to anticipate future economic or
financial developments or downturns, which could lead to an increase in our NPAs. Further, the expansion of our business
may cause our NPAs to increase and the overall quality of our loan portfolio to deteriorate. Any significant increase in
NPAs may have a material adverse effect on our financial condition, results of operations and cash flows.

Provisions for NPAs are created by a charge to our profit and loss account and are currently subject to minimum
provisioning requirements, linked to ageing of NPAs. In addition to the relevant regulatory minimum provisioning, we
also consider our Board approved policy, which sets out certain estimates to determine the appropriate level of provisions.
The determination of a suitable level of loan losses and provisions involves a degree of subjectivity and requires that we
make estimates of current credit risks and future trends, all of which may be subject to material changes. Any inaccurate
determination of risk may result in our provisions not being adequate to cover expected losses on NPAs. Our provision
coverage ratio was 48.33%, 75.80%, 84.71% and 89.58%, respectively in Fiscal 2018, 2019 and 2020 and in the nine
months ended December 31, 2020, and there can be no assurance that our provision coverage ratio will continue to increase
or that it will not decline in the future. We may need to make further provisions if there is dilution/ deterioration in the
quality of our security, or down-grading of the account, or if recoveries with respect to such NPAs do not materialize in
time or at all. Any increase in provisions may adversely impact our financial performance. Further, there can be no
assurance that the transition to Ind AS will not further increase our provisioning requirements in the future. For instance,
on transitioning to Ind AS, we may need to compute provisions on the basis of the expected credit loss method as against
the current method for incurred credit loss, which may further increase our provisioning requirements in the future.
Accordingly, any significant increase in our NPAs may have a material adverse effect on our financial condition, results
of operations and cash flows, and as a result, our return ratios may not be consistent with our previous performance.

One of our Promoters, R. Baskar Babu, has encumbered his Equity Shares with certain Systemically Important NBFCs
by way of pledge. Any exercise of such encumbrance by such Systemically Important NBFCs could dilute the
shareholding of such Promoter and consequently dilute the aggregate shareholding of our Promoters, which may
materially and adversely affect our business and financial condition.

As of the date of this Prospectus, 11,290,000 Equity Shares constituting 11.52% of our Equity Shares are held by one of
our Promoters, Baskar Babu Ramachandran, of which 8,150,000 Equity Shares are pledged in favour of Avendus Finance
Private Limited and Kiran Vyapar Limited and 3,140,000 Equity Shares are pledged in favour of Placid Limited, in relation
to borrowing arrangements entered into by Baskar Babu Ramachandran in his personal capacity. Any default under the
agreements pursuant to which these Equity Shares have been pledged will entitle the pledgee to enforce the pledge over
these Equity Shares. If this happens, the aggregate shareholding of the Promoters may be diluted and we may face certain
impediments in taking decisions on certain key, strategic matters. As a result, we may not be able to conduct our business
or implement our strategies as currently planned, which may materially and adversely affect our business and financial
condition. Further, any rapid sale of Equity Shares by such third parties may materially and adversely affect the price of
the Equity Shares. Further, as detailed in “ — Banks in India, including our Bank, are subject to stringent regulatory
requirements and prudential norms and our inability to comply with such laws, regulations and norms may have an
adverse effect on our business, results of operations, financial condition and cash flows.” on pages 24-26, we are subject
to certain ownership and eligibility requirements with respect to the shareholding of our Equity Shares. Any dilution in
the shareholding of the Promoters in our Bank by way of enforcing the pledge may therefore result in a failure to comply
with these regulatory requirements, further dilute the aggregate Promoter shareholding, and will therefore have a material
adverse effect on us, our business and our financial condition including our ability to access capital.

A significant portion of our advances are towards customers located in the States of Tamil Nadu, Maharashtra and
Odisha, and any adverse changes in the conditions affecting these regions can adversely impact our business, financial
condition and results of operations.

A large number of our Banking Outlets are located in the States of Tamil Nadu, Maharashtra and Odisha. Consequently,
a majority of our advances are towards customers in Tamil Nadu, Maharashtra and Odisha. As of December 31, 2020, 338
out of our 554 Banking Outlets were located in these three States and advances towards customers in Maharashtra, Tamil
Nadu and Odisha represented 34.76%, 27.43% and 15.11%, respectively, of our Gross Advances as of such dates. For
further information in relation to our geographical presence, see “Our Business” beginning on page 141 and “Selected
Statistical Information” beginning on page 211, respectively.

In the event of a regional slowdown in the economic activity in Tamil Nadu, Maharashtra or Odisha, or any other

developments including political unrest, disruption or sustained economic downturn or natural calamities in the regions
affecting the ability of our borrowers to repay our loans, or that make our products in these States less beneficial, we may

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