Rationale/Description of Key Rating Drivers/Rating sensitivities:

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Rating Rationale Indiabulls Housing Finance Ltd. 2 May 2018 Brickwork Ratings reaffirms the ratings for various existing debt issues of Indiabulls Housing Finance Ltd aggregating to 37,150 crs.

1 Rating Rationale Indiabulls Housing Finance Ltd. 2 May 2018 Brickwork Ratings reaffirms the ratings for various existing debt issues of Indiabulls Housing Finance Ltd aggregating to 37,150 crs. Particulars Issue Limit ( Crs) O/s Amount ( Crs) Tenure Rating History (Apr 2017) Reaffirmed Rating* Secured NCD (Public Issue) 6, , Subordinated debt (Public Issue) Secured NCD 27,000 20, Long Term (Pronounced as BWR Triple A) () (Pronounced as BWR Triple A) () Subordinated 3,000 2, Perpetual (Pronounced as BWR Double A Plus) () *Please refer to BWR website for definition of the ratings (Pronounced as BWR Double A Plus) () Rating Reaffirmed Rationale/Description of Key Rating Drivers/Rating sensitivities: BWR has principally relied upon the audited financial results of the Company up to FY17, provisional financials for FY18, projections, publicly available information, and information/clarifications provided by the Company s management. 1 2 May 2018

2 The rating reaffirmation factors, inter alia, the strong track record of IBHFL s housing finance business, experienced & professional management, significant and sustainable growth in business due to expansion of operations and growth of loan book while maintaining the asset quality, comfortable capitalization with ability to raise funds and strong credit appraisal, loan monitoring & recovery policy. The rating is however, constrained by competition from banks and other competing HFCs, in general and susceptibility to asset quality risks. Description of Key Rating Drivers Credit Strengths: Established market position: IBHFL has an established position in the market as one of the 3 largest HFCs in India with Gross AUM of 122,578 crs generating an ROE of 30% and ROA of 3.31% as of 31st Mar AUM has grown at a CAGR of 29 % for the last 5 years. With the demand in the affordable housing sector expected to remain strong and given the company s market reach, we expect the company continues to grow sustainably in the coming years Comfortable Capitalization levels with healthy liquidity: As on 31st Mar 2018, IBHFL s CRAR comfortably stood at 20.82% with Tier I CRAR of 15.07%, which is well above NHBs stipulated minimum requirement of 12% (Tier I - 6%). IBHFL has a strong networth of 13,354 as on 31st Mar 2018 and total debt of 110,257 crs which results in gearing of 8.25x and given the strong liquidity available, IBHFL maintains net gearing at 7x. Healthy Asset Quality: IBHFL has always maintained its NPAs well below 1% of the total portfolio reflecting its prudent risk mitigating measures and strong credit appraisal system. As on 31st Mar 2018 Gross NPA & Net NPA stood at 0.77% and 0.34% respectively with comfortable Provision Coverage Ratio of ~56%. Strong financial performance: Driven by operational efficiency and low credit costs, the earnings profile of the company continues to consistently grow. As per FY18 financials on a consolidated levels, the company reported Net Operating Income of 5,408 crs ( 3,988 crs in FY17) and PAT of 3,847 crs ( 2,906 Crs in FY17) Robust demand for affordable housing segment: Government of India s policy of housing for all by the year 2022 under Pradhan Mantri Awas Yojana coupled with increase in disposable income of salaried segment has created robust demand for affordable housing across the country which will further augment the growth of HFCs. Credit Risks: Sizeable exposure to Corporate Mortgage loans: The company has a sizeable exposure by way of Corporate Mortgage Loans which are generally extended to real estate developers, as also 2 2 May 2018

3 those who monetise their rental earning commercial properties. These are usually high ticket exposures, and currently account of ~ 21% of their loan book. Asset quality of such loans is generally lower than that of home loans, and hence, the need to closely monitor all such exposures for possible impairment. However given the credit appraisal system and risk management policies of the company, Brickwork expects that probability of this portfolio affecting the overall asset quality is low. Analytical Approach For arriving at its ratings, BWR has applied its rating methodology as detailed in the Rating Criteria detailed below (hyperlinks provided at the end of this rationale). Rating BWR believes the Indiabulls Housing Finance Ltd. business risk profile will be maintained over the medium term. The outlook indicates a low likelihood of rating change over the medium term. The rating outlook may be revised to 'Positive' in case the revenues and profit show sustained improvement. The rating outlook may be revised to 'Negative' if the revenues go down and profit margins show lower than expected figures. About the Company IBHFL, incorporated in 2006, is registered with and regulated by National Housing Bank (NHB) and is engaged in the business of Mortgage backed Finance - home loans and loan against property and Corporate Mortgage Loan - lease rental discounting and residential construction finance. The company is promoted by Mr. Sameer Gehlaut, who has 23.5 % shareholding directly or through other fully owned entities. The company is listed in BSE/NSE. IBHFL is the flagship company of the Indiabulls Group, a leading business house, with businesses spread across many sectors including Housing Finance, Real Estate and Financial Services. Mr. Sameer Gehlaut is the Chairman of the Board of IBHFL. Mr. Gagan Banga is the Vice Chairman, Managing Director & CEO and Mr. Ashwini Kumar Hooda is the Deputy Managing Director of IBHFL. Besides them the Board consists of one Executive Director, one Non- Executive Director, one Whole Time Director and six Independent Directors. The company also has well qualified and experienced professionals looking after credit, risk, marketing, audit and other support functions. IBHFL is engaged in the business of providing home loans and loan against property. Asset under Management (AUM) as of Mar 31, 2018 was 122,578 Crores compared to 91,301 Crores as of March 31, Mortgage loans constituted 79% of the AUM with the remaining 21% from Corporate Mortgage loans as of Mar 31, May 2018

4 The Company has also undertaken securitization/ sell down of its loan assets and the amount outstanding as of Mar 31, 2018 was 10,104 Crores. As of Mar 31, 2018, Gross NPA stood at 0.77% (0.85% as of March 31, 2017) with Provision coverage ratio (for Substandard Assets) of 56%. Its capital adequacy in the form of CRAR stood at 20.82% as of Mar 31, 2018 which is well above the NHB s minimum stipulated requirement of 12%. Company s Tier I CRAR stood at 15.07% as against minimum stipulated requirement of 6%. Company Financial Performance (Financial information of latest two financial years to be given along with key performance indicators) As per the provisional financials for FY18, at a consolidated level, Total Income from Operations stood at 13,062 Crores compared to 10,399 Crores for FY17, a y-o-y growth of ~26%, while Net Income from Operations (Total Income from Operations net of Finance Cost) increased from 3,988 Crores for FY17 to 5,408 Crores for FY18, a growth of ~36%. Net Interest Margin was 6.0%. PAT (after minority interest and share of profit/loss of Associate) stood at 3,847 Crores for FY18 compared to 2,906 Crores for FY17. Return on Asset was around 3.31% for FY18 when compared to 3.60% in FY17. Rating History for the last three years Sl No Instrument 1 Proposed Secured NCD Current Rating (Year 2017) Long Term (21 Apr 2017) Rating History 2016 (19 Aug 2016) 2015 (21 Dec 2015) 2 NCD (Public Issue) Long Term 6, Subordinate d (Public Issue) Long Term NCD Long Term Subordinated Long Term May 2018

5 6 NCD Long Term NCD Long Term Subordinated 9 Subordinated Long Term 650 Long Term Perpetual Perpetual NCD Long Term Subordinated 13 Subordinated Long Term 300 Long Term NCD Long Term NCD Long Term 6500 (enhanced from 4000 ) 5 2 May 2018

6 Key Financial Indicators Key Parameters Units Result Type Audited Audited Net Operating Income Cr 5,408 3,988 PAT Cr 3,847 2,906 Total Cr 110,257 85,301 Tangible Net worth Cr 13,354 12,043 Total /Tangible Net worth Times GNPA % NNPA % CRAR % Hyperlink/Reference to applicable Criteria General Criteria Approach to Financial Ratios Banks & Financial Institutions For any other criteria obtain hyperlinks from website Analytical Contacts Manjunatha MSR Head -Ratings Administration analyst@brickworkratings.com Media media@brickworkratings.com Relationship Contact bd@brickworkratings.com Phone: For print and digital media The Rating Rationale is sent to you for the sole purpose of dissemination through your print, digital or electronic media. While it may be used by you acknowledging credit to BWR, please do not change the wordings in the rationale to avoid conveying a meaning different from what was intended by BWR. BWR alone has the sole right of sharing (both direct and indirect) its rationales for consideration or otherwise through any print or electronic or digital media. Note on complexity levels of the rated instrument: 6 2 May 2018

7 BWR complexity levels are meant for educating investors. The BWR complexity levels are available at Investors queries can be sent to About Brickwork Ratings Brickwork Ratings (BWR), a SEBI registered Credit Rating Agency, has also been accredited by RBI and empaneled by NSIC, offers Bank Loan, NCD, Commercial Paper, MSME ratings and grading services. BARD has empaneled Brickwork for MFI and NGO grading. BWR is accredited by IREDA & the Ministry of New and Renewable Energy (MNRE), Government of India. Brickwork Ratings has Canara Bank, a Nationalized Bank, as its promoter and strategic partner. BWR has its corporate office in Bengaluru and a country-wide presence with its offices in Ahmedabad, Chandigarh, Chennai, Guwahati, Hyderabad, Kolkata, Mumbai and New Delhi along with representatives in 150+ locations. BWR has rated debt instruments/bonds/bank loans, securitized paper of over 10,00,000 Cr. In addition, BWR has rated over 6300 MSMEs. Also, Fixed Deposits and Commercial Papers etc. worth over 24,440 Cr have been rated. DISCLAIMER Brickwork Ratings (BWR) has assigned the rating based on the information obtained from the issuer and other reliable sources, which are deemed to be accurate. BWR has taken considerable steps to avoid any data distortion; however, it does not examine the precision or completeness of the information obtained. And hence, the information in this report is presented as is without any express or implied warranty of any kind. BWR does not make any representation in respect to the truth or accuracy of any such information. The rating assigned by BWR should be treated as an opinion rather than a recommendation to buy, sell or hold the rated instrument and BWR shall not be liable for any losses incurred by users from any use of this report or its contents. BWR has the right to change, suspend or withdraw the ratings at any time for any reasons. Annexure: Issue wise details of instruments rated by BWR INSTRUMENT ISSUE DATE AMOUNT (in Crs.) COUPON MATURITY DATE ISIN NO. Secured NCD 18-Feb % 18-Feb-21 INE148I07480 Secured NCD 7-Sep % 7-Sep-21 INE894F07360 Secured NCD 22-Nov % 22-Nov-21 INE148I07076 Secured NCD 27-Feb % 27-Feb-22 INE894F07519 Secured NCD 3-Apr % 3-Apr-22 INE148I07100 Secured NCD 28-Jun % 7 28-Jun-22 INE894F May 2018

8 Secured NCD 6-Jul % 6-Jul-22 INE894F07543 Secured NCD 6-Nov % 6-Nov-22 INE148I07142 Secured NCD 19-Nov % 19-Nov-22 INE148I07159 Secured NCD 18-Dec % 18-Dec-22 INE148I07183 Secured NCD 31-Dec % 31-Dec-22 INE894F07667 Secured NCD 31-Dec % 31-Dec-22 INE148I07191 Secured NCD 16-Jan % 16-Jan-23 INE894F07717 Secured NCD 26-Feb % 26-Feb-23 INE148I07209 Secured NCD 19-Mar % 19-Mar-23 INE148I07241 Secured NCD 25-Mar % 25-Mar-23 INE148I07266 Secured NCD 29-Aug % 29-Aug-23 INE148I07357 Secured NCD 8-Oct % 8-Oct-23 INE148I07373 Secured NCD 21-Nov % 21-Nov-23 INE148I07381 Secured NCD 24-Dec % 24-Dec-23 INE148I07415 Secured NCD 5-Jun % 5-Jun-24 INE148I07639 Secured NCD 30-Jun % 30-Jun-24 INE148I07746 Secured NCD 26-Jun % 26-June-25 INE148I07CN8 Secured NCD 30-Jun % 13-Jun-18 INE148I07FB6 Secured NCD 15-Mar % 15-Jun-18 INE148I07GQ2 Secured NCD 17-Mar % 15-Jun-18 INE148I07GV2 Secured NCD 20-Apr % 21-June-18 INE148I07HL1 Secured NCD 31-Mar % 29-June-18 INE148I07HD8 Secured NCD 18-Jul % 18-Jul-18 INE148I07FI1 Secured NCD 9-Aug % 9-Aug-18 INE148I07FL5 Secured NCD 9-Aug % 9-Aug-18 INE148I07FM3 Secured NCD 11-Aug % 10-Aug-18 INE148I07FP6 Secured NCD 11-Aug % 10-Aug-18 INE148I07FQ4 Secured NCD 30-Jun % 16-Aug-18 INE148I07FC4 Secured NCD 31-Aug % 31-Aug-18 INE148I07DD7 Secured NCD 2-Sep % 31-Aug-18 INE148I07FW2 Secured NCD 23-Mar % 12-Sep-18 INE148I07EC7 Secured NCD 25-Nov % 23-Nov-18 INE148I07GO7 Secured NCD 19-Jan % 19-Jan-19 INE148I07DS5 Secured NCD 23-Feb % 22-Feb-19 INE148I07DX5 Secured NCD 24-Feb % 22-Feb-19 INE148I07DY3 Secured NCD 23-Mar % 11-Mar-19 INE148I07ED5 Secured NCD 20-Apr % 19-Mar-19 INE148I07HM9 Secured NCD 25-Apr % 25-Mar-19 INE148I07HP2 Secured NCD 31-Mar % 29-Mar-19 INE148I07EH6 Secured NCD 12-Apr % 12-Apr-19 INE148I07EJ2 8 2 May 2018 Secured NCD 30-Jun % 11-Jun-19 INE148I07FD2

9 Secured NCD 30-Jun % 28-Jun-19 INE148I07FE0 Secured NCD 15-Jan % 15-Jul-19 INE148I07DQ9 Secured NCD 30-Jun % 15-Jul-19 INE148I07FF7 Secured NCD 9-Aug % 9-Aug-19 INE148I07FN1 Secured NCD 11-Aug % 9-Aug-19 INE148I07FR2 Secured NCD 22-Aug % 22-Aug-19 INE148I07HW8 Secured NCD 1-Jun % 3-Sep-19 INE148I07ET1 Secured NCD 21-Apr % 19-Sep-19 INE148I07HO5 Secured NCD 31-Oct % 30-Oct-19 INE148I07AG6 Secured NCD 14-Nov % 14-Nov-19 INE148I07AJ0 Secured NCD 2-Sep % 2-Mar-20 INE148I07FX0 Secured NCD 15-Mar % 13-Mar-20 INE148I07GR0 Secured NCD 18-Apr % 13-Mar-20 INE148I07HH9 Secured NCD 20-Apr % 26-Mar-20 INE148I07HN7 Secured NCD 27-Mar % 27-Mar-20 INE148I07BP5 Secured NCD 27-Mar % 27-Mar-20 INE148I07GZ3 Secured NCD 20-Apr % 20-Apr-20 INE148I07HK3 Secured NCD 20-Apr % 28-Apr-20 INE148I07HJ5 Secured NCD 15-Mar % 30-Apr-20 INE148I07GS8 Secured NCD 31-Mar % 30-Apr-20 INE148I07HE6 Secured NCD 15-Mar % 4-May-20 INE148I07GU4 Secured NCD 29-Mar % 5-May-20 INE148I07HA4 Secured NCD 15-Mar % 12-May-20 INE148I07GT6 Secured NCD 20-Apr % 12-May-20 INE148I07HI7 Secured NCD 23-Mar % 1-Jun-20 INE148I07GY6 Secured NCD 7-Apr % 29-Jun-20 INE148I07HG1 Secured NCD 7-Aug % 7-Aug-20 INE148I07CX7 Secured NCD 4-Sep % 4-Sep-20 INE148I07DE5 Secured NCD 18-Sep % 18-Sep-20 INE148I07DF2 Secured NCD 20-Nov % 20-Nov-20 INE148I07DJ4 Secured NCD 30-Dec % 30-Dec-20 INE148I07DM8 Secured NCD 7-Jan % 7-Jan-21 INE148I07DP1 Secured NCD 19-Jan % 19-Jan-21 INE148I07DT3 Secured NCD 8-Feb % 8-Feb-21 INE148I07DU1 Secured NCD 12-Apr % 12-Apr-21 INE148I07EK0 Secured NCD 10-May % 10-May-21 INE148I07EN4 Secured NCD 23-May % 21-May-21 INE148I07EP9 Secured NCD 1-Jun % 29-May-21 INE148I07EU9 Secured NCD 7-Jun % 7-Jun-21 INE148I07EV7 Secured NCD 11-Aug % 11-Aug-21 INE148I07FS0 9 2 May 2018 Secured NCD 16-Aug % 16-Aug-21 INE148I07FT8

10 Secured NCD 23-Aug % 23-Aug-21 INE148I07FV4 Secured NCD 21-Mar % 21-Mar-22 INE148I07GW0 Secured NCD 22-Mar % 22-Mar-22 INE148I07GX8 Secured NCD 30-Mar % 30-Mar-22 INE148I07HC0 Secured NCD 6-Apr % 6-Apr-22 INE148I07HF3 Secured NCD 20-Nov % 20-Nov-22 INE148I07DK2 Secured NCD 16-Dec % 16-Dec-24 INE148I07AV5 Secured NCD 31-Dec % 31-Dec-24 INE148I07BA7 Secured NCD 19-May % 19-May-25 INE148I07BV3 Secured NCD 20-Nov % 20-Nov-25 INE148I07DL0 Secured NCD 30-Dec % 30-Dec-25 INE148I07DN6 Secured NCD 31-Dec % 31-Dec-25 INE148I07DO4 Secured NCD 8-Feb % 7-Feb-26 INE148I07DV9 Secured NCD 14-Mar % 13-Mar-26 INE148I07EA1 Secured NCD 12-Apr % 11-Apr-26 INE148I07EL8 Secured NCD 29-Apr % 29-Apr-26 INE148I07EM6 Secured NCD 10-May % 8-May-26 INE148I07EO2 Secured NCD 30-May % 29-May-26 INE148I07ES3 Secured NCD 7-Jun % 5-Jun-26 INE148I07EW5 Secured NCD 30-Jun % 30-Jun-26 INE148I07FG5 Secured NCD 22-Jul % 22-Jul-26 INE148I07FJ9 Sub- 15-Nov % 15-Nov-27 INE894F08137 Sub- 15-Nov % 15-Nov-22 INE894F08129 Sub- 5-Jun % 5-Jun-27 INE894F08087 Sub- 5-Jun % 5-Jun-22 INE894F08079 Sub- 30-Mar % 30-Mar-22 INE894F08061 Sub- 31-Jan % 31-Jan-22 INE894F08038 Sub- 22-Feb % 22-Feb-22 INE894F08053 Sub- 30-Jun % 30-Jun-27 INE894F08111 Sub- 28-Jun % 28-Jun-27 INE894F08103 Sub- 17-Jul % 17-Jul-24 INE148I08173 Sub- 23-Dec % 23-Dec-23 INE148I08165 Sub- 24-Oct % 24-Oct-23 INE148I08157 Sub- 27-Sep % 27-Sep-23 INE148I08140 Sub- 23-Sep % 23-Sep-23 INE148I May 2018

11 Sub- 3-Jun % 3-Jun-23 INE148I08124 Sub- 23-May % 23-May-23 INE148I08116 Sub- 28-Mar % 28-Mar-23 INE148I08108 Sub- 6-Mar % 6-Mar-23 INE148I08090 Sub- 18-Feb % 18-Feb-23 INE148I08082 Sub- 30-Jan % 30-Jan-23 INE148I08074 Sub- 14-Jan % 14-Jan-23 INE148I08066 Sub- 4-Dec % 4-Dec-22 INE148I08058 Sub- 31-Oct % 31-Oct-22 INE148I08041 Sub- 22-Oct % 22-Oct-22 INE148I08033 Sub- 9-Oct % 9-Oct-22 INE148I08025 Sub- 17-Mar % 17-Mar-25 INE148I08181 Sub- 21-Jul % 21-Jul-25 INE148I08199 Sub- 3-Aug % 3-Aug-25 INE148I08207 Sub- 29-Jun % 29-Jun-26 INE148I08215 Sub- 8-Sep % 6-Sep-24 INE148I08280 Sub- 8-Sep % 8-Sep-27 INE148I08298 Retail Bonds 26-Sep % 26-Sep-19 INE148I07FY8 Retail Bonds 26-Sep % 26-Sep-19 INE148I07FZ5 Retail Bonds 26-Sep % 26-Sep-19 INE148I07GA6 Retail Bonds 26-Sep % 26-Sep-19 INE148I07GD0 Retail Bonds 26-Sep % 26-Sep-21 INE148I07GE8 Retail Bonds 26-Sep % 26-Sep-21 INE148I07GF5 Retail Bonds 26-Sep % 26-Sep-21 INE148I07GH1 Retail Bonds 26-Sep % 26-Sep-26 INE148I07GJ7 Retail Bonds 26-Sep % 26-Sep-26 INE148I07GK5 Retail Bonds 26-Sep % 26-Sep-26 INE148I07GL3 Retail Bonds 26-Sep % 26-Sep-26 INE148I07GN9 Retail Bonds 26-Sep % 26-Sep-26 INE148I08231 Retail Bonds 26-Sep % 26-Sep-26 INE148I08249 Retail Bonds 26-Sep % 26-Sep-26 INE148I08256 Retail Bonds 26-Sep % 26-Sep-26 INE148I08272 Perpetual- 28-Jun % Perpetual INE894F May 2018

Mahindra & Mahindra Financial Services Limited

Rating Rationale Mahindra & Mahindra Financial Services Limited 12 June 2017 Brickwork Ratings assigns rating for the Proposed Unsecured issue up to ` 2000 Crores and reaffirms the existing ratings for