Five-Star Business Finance Limited shareholders approved a borrowing limit of ₹13,000 crore and authorized the issuance of non-convertible debentures (NCDs) up to ₹5,000 crore at its 42nd annual general meeting held on August 31, 2026.

The Chennai-based NBFC also declared a final dividend of ₹2 per equity share for the financial year ended March 31, 2026. The resolutions were passed via remote e-voting and voting during the virtual meeting chaired by Chairman & Managing Director Lakshmipathy Deenadayalan.

Capital Raise and Borrowing Authority

The special business agenda focused on expanding the company’s funding capacity. Shareholders granted approval under Section 180(1)(c) of the Companies Act, 2013, to borrow up to ₹13,000 crore. This limit matches the amount approved for creating charges on company assets under Section 180(1)(a).

Additionally, the board secured mandate to invite subscriptions for NCDs through private placement in one or more tranches, aggregating up to ₹5,000 crore. These approvals signal the company’s intent to scale its asset book or manage liquidity requirements through long-term debt instruments.

Governance and Appointments

The ordinary business included the re-appointment of Mr Thirulokchand Vasan as a director after retirement by rotation. The company also appointed M/s Suri & Co, Chartered Accountants from Chennai, as Joint Statutory Auditors for three consecutive financial years: FY27, FY28, and FY29.

Mr Sreeram Ranganathan Iyer was appointed as a Non-Executive Independent Director for five years, effective July 25, 2026. The meeting acknowledged the contributions of Ms Bhama Krishnamurthy and Mr Anand Raghavan, who stepped down as Independent Directors upon completing their ten-year tenure.

Audit and Compliance

The statutory auditors, represented by Mr GK Subramaniam of Deloitte Haskins & Sells, and secretarial auditors, represented by Mr Sandeep S of M/s S Sandeep & Associates, confirmed that their reports contained no qualifications or adverse observations. The unqualified audit reports were taken as read by the members.

The voting results, scrutinized by Mr S Sandeep, were scheduled for announcement within two working days. The meeting concluded at 11:09 am after a 15-minute window for final e-voting.

Five-Star Business Finance Limited has scheduled its 42nd Annual General Meeting (AGM) for August 31, 2026, to be conducted via Video Conferencing (VC) or Other Audio Visual Means (OAVM). The meeting is set to begin at 10:00 AM IST and will seek shareholder approval for critical capital structure decisions, including the authorization to issue Non-Convertible Debentures (NCDs) aggregating up to ₹5,000 crore through private placement. This move aims to secure funding for business expansion and working capital needs amidst a challenging macroeconomic environment.

The company is also seeking consent to raise borrowings up to ₹13,000 crore, an increase from the existing limit of ₹12,000 crore. This expansion requires shareholder approval under Section 180(1)(c) of the Companies Act, 2013, as it exceeds the aggregate of paid-up capital and free reserves. Concurrently, the Board seeks authorization under Section 180(1)(a) to create charges on assets to secure these borrowings. These resolutions are vital for maintaining liquidity and supporting growth initiatives in the secured lending segment.

Key Resolutions and Corporate Actions

The AGM agenda includes several ordinary and special resolutions. Key details of the proposals are outlined below:

Shareholders will also vote on the appointment of Sreeram Ranganathan Iyer as a Non-Executive Independent Director and the re-appointment of Thirulokchand Vasan. Sreeram Ranganathan Iyer, a global banker with over 33 years of experience, will serve for five years from July 25, 2026. The Board has recommended a final dividend of ₹2 per equity share for FY26, subject to shareholder approval.

Regulatory Compliance and Voting

In compliance with SEBI Master Circular No. HO/38/13(4)/2026-MIRSD-POD/I/4298/2026, holders of physical securities must update their KYC details, including PAN and bank account information, to receive dividends electronically. The record date for dividend entitlement is fixed as July 31, 2026. Remote e-voting for the AGM will be available from August 28, 2026, to August 30, 2026, through the National Securities Depository Limited (NSDL) platform. The Notice of Annual General Meeting is available on the company's website.

What the Numbers Show

The push for higher borrowing limits and NCD issuance underscores Five-Star Business Finance's strategy to maintain aggressive growth despite asset quality pressures. With Gross Non-Performing Assets (GNPA) rising to 3.37% in FY26 from 1.79% in FY25 due to sector-wide overleverage issues, securing diverse and cost-effective funding sources is crucial. The company's Capital Adequacy Ratio stood at 51.89% as of March 31, 2026, well above the RBI's 15% threshold, providing a strong buffer for increased leverage.