Mar 31, 2018
TO THE MEMBERS
The Companyâs financial performance for the financial year ended March 31, 2018, is summarized below:
(Rs in crore)
Particulars |
Standalone |
Consolidated |
||
2017-18 |
2016-17 |
2017-18 |
2016-17 |
|
Profit Before Tax |
314.29 |
280.17 |
314.29 |
280.17 |
Less : Provision for Taxation |
||||
Current Year |
102.38 |
94.00 |
102.38 |
94.00 |
Deferred |
5.79 |
3.92 |
5.79 |
3.92 |
Profit after tax |
206.11 |
182.25 |
206.11 |
182.25 |
Add : Net share of profit from Associate |
- |
- |
9.20 |
5.40 |
Add : Balance brought forward from the previous year |
235.95 |
161.26 |
248.27 |
169.66 |
Less: Utilised during the current year for depreciation charged in accordance with Schedule II Companies Act 2013 |
- |
- |
- |
- |
Less: Dividend received from Associate credited to carrying value of investment |
- |
- |
2.25 |
1.49 |
Amount available for appropriations |
442.06 |
343.51 |
461.33 |
355.83 |
Appropriations |
||||
Transferred to additional reserve U/s 29C of the NHB Act, 1987 |
41.23 |
36.46 |
41.23 |
36.46 |
Transferred to Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank Act, 1987 |
55.65 |
51.10 |
55.65 |
51.10 |
Transferred to General Reserve |
20.00 |
20.00 |
20.00 |
20.00 |
Dividend for previous year (including dividend distribution tax) |
15.06 |
- |
15.06 |
- |
Balance carried over to Balance Sheet |
310.12 |
235.95 |
329.39 |
248.27 |
Total |
442.06 |
343.51 |
461.33 |
355.83 |
Earnings Per Share: |
||||
Basic (Rs.) |
32.95 |
29.13 |
34.42 |
30.00 |
Diluted (Rs.) |
32.95 |
29.13 |
34.42 |
30.00 |
DIVIDEND
Your Directors recommend a dividend of Rs.2.20 per equity share of face value of Rs.10.00 each for the year ended 31 March 2018 as against a dividend of Rs.2 per equity share of face value of Rs.10.00 each for the previous year. The dividend payout ratio for the year is 8.04% (amounting to Rs.16.57 crore, inclusive of Tax on dividend) as against 8.26% (amounting to Rs. 15.06 crore, inclusive of Tax on dividend) in the previous year.
In compliance with requirements stipulated vide SEBI notification no. SEBI/ LAD-NR0/GN/2016-17/008 dated July 8, 2016 and Regulation 43A of the SEBI(LODR) Regulations,2015; the Dividend Distribution Policy of the Company is available on the website of the Company and has been provided as Annexure - 1 to this report.
TRANSFER TO RESERVES
During the year under review, your Company transferred Rs. 20.00 crore to the General Reserve, Rs. 55.65 crore to the Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Sec 29 C of NHB Act, 1987 and Rs. 41.23 crore to additional reserve under Sec 29C of NHB Act, 1987, out of the amount available for appropriation. An amount of Rs. 310.12 crore is proposed to be retained in the profit and loss account.
CHANGES IN SHARE CAPITAL
During the financial year, there was no change in the Paid up capital of the Company. As at 31st March 2018, the Paid up capital stood at Rs. 62,56,13,620 divided into 6,25,61,362 Equity shares of Rs. 10 each
STATE OF AFFAIRS OF THE COMPANY
The Company endeavors towards adopting the benchmark underwriting practices backed up by robust monitoring and recovery mechanisms. The Company is committed in its efforts towards improving efficiency and service level in its operations.
LENDING OPERATIONS
1) Sanctions
During the year, loan approvals stood at Rs.3,079.26 crore as compared to Rs. 2,875.75 crore in the previous year . The cumulative loan sanctions since inception of the Company stood at Rs. 18,682.58 crore at the end of the financial year 2017-18.
2) Disbursements
During the year under review, the Company disbursed loans to the extent of Rs.2,806.51 crore as against Rs.2,642.39 crore in the previous year. The Cumulative disbursements stood at Rs.17,180.95 crore in respect of 1,35,463 accounts at the end of the financial year 2017-18.
3) Loans Outstanding
The loan book of the Company at the end of financial year 2017-18 was Rs.9,856.78 crore as against Rs.8,939.91 crore in the previous year representing a growth of 10.26%.
NON PERFORMING ASSETS
As of 31 March 2018, the gross NPA of the Company was Rs.282.65 crore (previous year Rs. 232.84 crore) constituting 2.87% (previous year 2.60%) of the total loans outstanding. Net NPA of the Company as at March 31, 2018 was 1.29% as against 1.39% in the corresponding period of the previous year. The NPA provision coverage ratio stood at 55.61% (previous year 47.29%) as at 31st March 2018. The Company carries a provision of Rs.157.17 crore (previous year Rs. 110.11 crore) towards its Non Performing Assets at the end of the financial year 2017-18. During the period under review, the Company has written off Rs.15.77 crore (previous year Rs.0.50 crore) from its books.
REGULATORY COMPLIANCE
The Company is in compliance with the guidelines, circulars and directions of National Housing Bank. The Company is also in compliance with the Companies Act 2013, guidelines, directions and circulars of MCA, SEBI etc. The Company complied with Mandatory Accounting Standards as prescribed under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules 2014, and other related statutory Guidelines / Directions as applicable to the Company from time to time. The Company is registered with the Central Registry of Securitization, Asset Reconstruction and Security Interest of India (CERSAI) and furnishes information in respect of its loans. Compliance of all regulatory guidelines to NHB / other status are periodically reviewed at Audit Committee / Board of the Company.
The Companyâs capital adequacy ratio as on 31 March 2018 was 23.04% (previous year 21.25%) which is well above the prescribed 12% threshold as per NHB Directions. This consisted entirely of Tier 1 capital.
Complying with the provisions of the directions of the National Housing Bank, a provision of Rs2.10 crore (previous year Rs. 5.23 crore) being charged to statement of Profit & Loss Account of the financial year 2017-18 in respect of standard assets and the cumulative provision in respect of standard assets stood at Rs.42.33 crore (previous year Rs. 40.24 crore) as at 31st March 2018.
The company has taken steps to adopt Ind-AS as notified by the MCA.
FINANCIAL RESOURCES REFINANCE FROM NHB
During the year the Company has not availed any refinance facility (previous year Rs. 500 crore) from National Housing Bank. The refinance outstanding at the end of the year was Rs. 942.31crore (previous year Rs. 1,170.10 crore)
TERM LOANS FROM BANKS AND FINANCIAL INSTITUTIONS
The outstanding borrowings from Banks and Financial Institutions (terms loans and overdraft) at the end of the financial year stood at Rs. 5057.70 crore (previous year Rs. 5,255.33 crore).
SECURED NON CONVERTIBLE DEBENTURES
During the year, the company has issued SRNCDs aggregating to Rs. 652 crores (previous year Rs. 385 crores). The outstanding SRNCDs as on 31st March 2018 was Rs.1337 crores (previous year Rs. 785 crores). These instruments have been rated âICRA AA-â by M/s. ICRA Ltd., and âCARE AAâ by M/s. CARE Ltd.,
COMMERCIAL PAPERS
The Companyâs commercial paper is rated A1 by M/s. ICRA Ltd., and CARE Ltd., implying highest safety. During the financial year 2017-18, the Company has raised funds amounting to Rs. 2,350 crores (previous year Rs. 1,400 crores) by way of issuance of commercial paper. After repayments on maturity, the net amount outstanding as at 31st March 2018, was Rs.800 crores. (Previous year NIL).
UNCLAIMED NCDS
According to section 125 of the Companies Act, 2013, NCDs and interest thereon remaining unclaimed and unpaid for a period of seven years from the date they became due are required to be credited to the Investor Education and Protection Fund (IEPF) set up by the Government of India. As at 31 March 2018 there are no non convertible debentures amount or interest thereon remaining unpaid or unclaimed.
DISCLOSURE UNDER HOUSING FINANCE COMPANIES ISSUANCE OF NON CONVERTIBLE DEBENTURES ON PRIVATE PLACEMENT BASIS, (NHB) DIRECTIONS 2014.
There are no Non Convertible Debentures which have not been claimed by the Investors or which were not paid by the Company after the date on which the Non Convertible Debentures became due for redemption. During the year, the company redeemed NCDâs amounting Rs. 100 crore pursuant to maturity. Further the Company has paid the interest on respective due dates.
UNCLAIMED DIVIDENDS
As of 31 March 2018, dividend amounting to Rs.1,35,382 (previous year Rs. 46,432) has not been claimed by the investors. According to section 125 of the Companies Act, 2013 dividends remaining unclaimed for a period of seven years from the date they became due are required to be credited to the Investor Education and Protection Fund (IEPF) set up by the Government of India. In accordance with the Investor Education Fund (Uploading of information regarding unpaid and unclaimed amount lying with the Companies) Rules 2012, the Company has uploaded this information on www.iepf.gov.in and www.repcohome.com/ new_site/unclaimed_dividend.php.
PUBLIC DEPOSITS
The Company has not accepted deposits from the public during the financial year 2017-18.
RISK MANAGEMENT
The Company has in place a risk management policy framework which has been approved by the Board of Directors. The framework identifies various risks faced by the Company and puts in place appropriate mitigants.
The Company has in place a Management & Risk Management committee comprising of Shri K. Sridhar, Shri G.R. Sundaravadivel, Shri. V. Nadanasabapathy and Shri R. Varadarajan.
HUMAN RESOURCES
The objective of human resource development in an organization is to enhance human productivity through progressive and consistent policies in knowledge & skill upgradation and betterment of employment conditions at all levels. Human Resource Managementâs objective is to maximize the return on investment from the organizationâs human capital. It is the responsibility of human resource/ development department in a corporate context to conduct these activities in an effective, legal, impartial and cohesive manner.
Your Company worked tirelessly towards the performance upgradation of its employees by introducing objective performance appraisal mechanism and performance linked incentive structure. Employees are also nominated regularly to attend various training programmes conducted by NHB, ICSI & other capacity building institutions besides in-house training programmes for constant skill upgradation. During the financial year the Company conducted 15 (including online training) in-house training programmes and employees were nominated for 11 external programmes.
The Company provides a professional work environment and maintains a healthy relation with its employees.
As on 31 March 2018, the number of people employed by the Company stood at 785.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of women at the workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The following is a summary of sexual harassment complaints received and disposed off during the year 2017-18
- No. of complaints received: Nil
- No of complaints disposed off: Not Applicable
PARTICULARS OF EMPLOYEES COVERED UNDER COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL RULES, 2014.
There were no employee who was in receipt of remuneration of Rs 1.02 crore or more per annum.
In accordance with the provisions of section 197 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, the name and other particulars of such employees are set out in the annex to the Directorsâ Report. However, as per the provisions of section 136 of the Companies Act, 2013, the Directorsâ Report is being sent to all shareholders of the Company excluding the annex.
The annex is available for inspection by the members at the registered office of the Company during business hours on working days up to the date of ensuing Annual General Meeting. Any shareholder interested in obtaining a copy of the said annex may write to the Company Secretary at the registered office of the Company.
CORPORATE SOCIAL RESPONSIBILITY
As per Section 135 of the Companies Act, 2013 and the rules framed thereunder, the Company has in place a Corporate Social Responsibility Committee of Directors comprising of Shri. K. Sridhar, Shri. G.R. Sundaravadivel and Shri. V. Nadanasabapathy and has inter alia formulated a Corporate Social Responsibility Policy.
This Committee envisages the activities to be undertaken in pursuance of CSR initiatives. During the year the Company spent a sum of Rs.0.14 crore towards CSR initiatives. The Annual Report on CSR activities forming part of the Directorsâ Report is furnished as Annexure-2 to this report.
EMPLOYEE STOCK OPTION SCHEME:
The employee stock options have been granted to the eligible employees and the Managing Director in pursuance of âRepco Home Finance Limited Employees Stock Option Scheme -2013â. There are no material changes to this scheme and the said scheme is in compliance with the extant regulations prescribed by the Securities and Exchange Board of India in this regard. The disclosures as prescribed by the âGuidance Note on accounting for employee share based paymentsâ issued by ICAI and the Diluted EPS on issue of shares pursuant to the Scheme in accordance with the Accounting Standard 20- Earnings per shareâ issued by ICAI are disclosed on the website of the Company. The disclosures as required by the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations 2014 have been placed on the website of the Company.
PARTICULARS RELATING TO CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
Particulars relating to conservation of energy and technology absorption stipulated in the Companies (Accounts) Rules 2014 are not applicable to the Company and further the Company has no foreign exchange earnings but incurred foreign exchange expenditure to the extent of Rs.0.004 crore (previous year Rs. 0.04 crore) towards travelling expenses and Rs. 2.82 crore towards other borrowing costs.
DIRECTORS
In accordance with Section 152 of the Companies Act, 2013, Smt. R.S. Isabella, Director of the Company is liable to retire by rotation at the ensuing annual general meeting and is eligible for reappointment. The resolution for her re-appointment forms a part of the notice convening the Annual General Meeting. The details pertaining to the reappointment are elucidated in the explanatory statement to the notice convening the Annual General Meeting.
All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015 (âListing Regulationsâ).
The details of familiarization programmes conducted for Independent Directors is put up on the website of the Company.
DETAILS OF MANAGERIAL REMUNERATION AS REQUIRED UNDER COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014
The particulars of managerial remuneration as required by under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given as Annexure-3.
AUDITORS
At the 17th Annual General Meeting held on 21 September 2017, the members had appointed M/s. S.R. Batliboi & Associates LLP Chartered Accountants (Firm Registration No. 101049W/ E300004) as Statutory Auditors for a term of five years beginning from the conclusion of the 17th Annual General Meeting till the conclusion of the 22nd Annual General Meeting.
The Statutory Auditors have not made any adverse comments or given any qualification, reservation or adverse remarks or disclaimer in their Audit Report.
DIRECTORSâ RESPONSIBILITY STATEMENT
In pursuance of section 134 (3) (C) of the Companies Act, 2013, and based on the information provided by the Management, your Directors hereby confirm that:
(a) In the preparation of the annual accounts, the applicable accounting standards have been followed;
(b) Accounting policies selected were applied consistently. Reasonable and prudent judgments and estimates were made so as to give a true and fair view of the state of affairs of the company as at 31 March 2018 and of the profit and loss of the Company for that date;
(c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) The annual accounts of the Company have been prepared on a going concern basis;
(e) Internal financial controls have been followed by the Company and such internal financial controls are adequate and were operating effectively.
(f) Systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.
INTERNAL CONTROL SYSTEMS
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.
The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board every quarter or at periodic intervals.
EXTRACTS OF THE ANNUAL RETURN (FORM MGT-9)
In accordance with Sec 134 (3) (a) of the said Act, amended provision, the provisional Annual Return in the prescribed format has been made available on the website of the Company at www.repcohome.com. The extract of Annual return is annexed to this report as Annexure-4.
SECRETARIAL AUDIT REPORT
In accordance with Section 204 of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, M/s. G Ramachandran & Associates, Company Secretaries were appointed by the Company to undertake Secretarial Audit of the Company. The Secretarial Audit Report is annexed to this report as Annexure-5.
Explanation on comments by the Board on Every qualification, reservation on adverse remark or disclaimer made by Auditor /Secretarial Auditor.
Neither the statutory auditor nor the secretarial auditor have made any qualification, reservation or adverse remark or disclaimer in their respective reports.
DETAILS OF LOANS GIVEN, GUARANTEES GIVEN OR SECURITY PROVIDED
The provisions contained in Section 186(11) of the Companies Act, 2013, relating to loans, guarantees or securities do not apply to the Company.
INVESTMENTS
The Company has investments in the equity of unlisted associate company, Repco Micro Finance Limited to the extent of Rs. 15.60 Crore (1,56,00,000 equity shares of Rs. 10/- each).
SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, your Company has prepared Consolidated Financial Statements of the Company which forms part of this Annual Report. Further, a Statement containing salient features of financial statements of the Subsidiary, joint venture entities and associate Companies in the prescribed format AOC-1, pursuant to Section 129(3) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, is annexed as Annexure-6 to this Report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1)
All the related party transactions entered during the year were in ordinary course of business and on armâs length basis. The Company has obtained the shareholdersâ approval for material related party transactions as required under Listing Regulations.
The Company presents a statement of all related party transactions before the Audit Committee. The details of such transactions are given in the accompanying financial statements.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE COMPANY BETWEEN 31ST MARCH 2018 AND THE DATE OF BOARDâS REPORT.
There has been no material changes and commitment, affecting the financial position of the Company which has occurred between the end of the financial year to which the financial statements relate and the date of the report.
The Company does not have any subsidiary. There has been no change in the nature of business of the Company. No significant or material Orders have been passed by the regulators or Courts or Tribunals impacting the going concern status of the Company and / or the Companyâs operations in future.
MANAGEMENT DISCUSSION AND ANALYSIS
In accordance with the SEBI (LODR) Regulations, 2015, Management Discussion and Analysis Report for the year under review, is presented in a separate section which forms a part of this report.
REPORT ON CORPORATE GOVERNANCE
In accordance with the SEBI (LODR) Regulations, 2015, the report on corporate governance for the year under review is presented in a separate section which forms a part of this report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Board of Directors has approved the vigil mechanism/ whistle blower policy of the Company which provides a framework to promote a responsible and secure whistle blowing. It protects employees wishing to raise a concern about serious irregularities within the Company. It provides for a vigil mechanism to channelize reporting of such instances/ complaints/ grievances to ensure proper governance. The Audit Committee oversees the vigil mechanism. No employee has been denied access to the Audit Committee. The policy is placed on the website of the Company, www.repcohome.com/new_site/corporate_ governance.php.
LISTING
The shares of your Company are listed at National Stock Exchange Limited and Bombay Stock Exchange Limited. Listing fee has already been paid for the financial year 2018-19.
DETAILS OF NON-COMPLIANCE, PENALTIES, IMPOSED ON BY ANY STATUTORY AUTHORITY
Pursuant to the inspection observations with reference to the financial position of the Company as at 31-03-2016, National Housing Bank levied penalty aggregating to Rs.35,000/- and GST thereon, with respect to the contraventions on (i) Income Recognition (Para-22); (ii) Assets Classification (Para-27); (iii) LTV Norms (Para-27A) (iv) Assigning wrong risk-weight resulting in incorrect CAR computation (Para-30); (v) Shortfall in Provisioning (Para-28) of the Housing Finance Companies (NHB) Directions 2010 and also (vi) disbursement of loans on the property for which the approved plan was not available (Policy Circular No.18) (vii) Guidelines on Fair Practices Code.
OTHERS Related Party Transaction Policy
As required by NHB notification no. NHB.HFC.CG-DIR.1/ MD&CEO/2016 dated February 9, 2017, a policy on Transactions with Related Parties is given as âAnnexure-7â to this report.
Business Responsibility Reporting
In accordance with the requirement under Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) (LODR) Regulations, 2015, Business Responsibility Report forms part of the Directorsâ Report and is annexed as Annexure-8â to this report.
ACKNOWLEDGEMENTS
The Directors of your Company wish to place on record their sincere gratitude to the National Housing Bank and its Executives for continuous guidance and support. We also record our gratitude to our bankers, financial institutions and insurance companies for their continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to Ministry of Home Affairs, GOI, SEBI, NSE, BSE, Department of Company Affairs, REPCO Bank, shareholders, Government, local/statutory authorities, customers and all the other stakeholders for their patronage and support for the achievements by the Company despite the most competitive environment in the market.
Your Directors take this opportunity to thank all the executives and employees of the Company and wish to place on record their commendable hard work, team spirit and dedicated service to the customers which enabled the Company to achieve an appreciable level of business performance during the year.
For and on behalf of the Board of Directors
Date : August 13, 2018 (T.S. KrishnaMurthy)
Place : Chennai Chairman
Mar 31, 2017
TO THE MEMBERS
The Company''s financial performance for the financial year ended March 31, 2017, is summarized below:
(Rs in crore)
Particulars |
Standalone |
Consolidated |
||
2016-17 |
2015-16 |
2016-17 |
2015-16 |
|
Profit Before Tax |
280.17 |
230.08 |
280.17 |
230.08 |
Less : Provision for Taxation Current Year Deferred |
94.00 3.92 |
74.22 5.78 |
94.00 3.92 |
74.22 5.78 |
Profit after tax |
182.25 |
150.08 |
182.25 |
150.08 |
Add : Net share of profit from Associate |
- |
- |
5.40 |
3.98 |
Add : Balance brought forward from the previous year |
161.26 |
115.60 |
169.67 |
120.78 |
Less: Utilised during the current year for depreciation charged in accordance with Schedule II Companies Act 2013 |
- |
- |
- |
- |
Less: Dividend received from Associate credited to carrying value of investment |
- |
- |
1.49 |
0.75 |
Amount available for appropriations |
343.51 |
265.68 |
355.83 |
274.09 |
Appropriations |
||||
Transferred to additional reserve U/s 29C of the NHB Act, 1987 |
36.46 |
30.02 |
36.46 |
30.02 |
Transferred to Statutory Reserve under Section 36(1) (viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank Act, 1987 |
51.10 |
40.85 |
51.10 |
40.85 |
Transferred to General Reserve |
20.00 |
20.00 |
20.00 |
20.00 |
Proposed Equity Dividend |
- |
11.26 |
- |
11.26 |
Tax on Dividends |
- |
2.29 |
- |
2.29 |
Balance carried over to Balance Sheet |
235.95 |
161.26 |
248.27 |
169.67 |
Total |
343.51 |
265.68 |
355.83 |
274.09 |
Earnings Per Share: |
||||
Basic (Rs.) |
29.13 |
24.04 |
30.00 |
24.68 |
Diluted (Rs.) |
29.13 |
24.03 |
30.00 |
24.66 |
Your Directors recommend a dividend of Rs.2 per equity share of face value of Rs.10.00 each for the year ended 31 March 2017 as against a dividend of Rs.1.80 per equity share of face value of Rs.10.00 each for the previous year. The dividend payout ratio for the year is 8.26% (amounting to Rs 15.06 crore, inclusive of Tax on dividend) as against 9.03% (amounting to Rs.13.55 crore, inclusive of Tax on dividend) in the previous year.
In compliance with requirements stipulated vide SEBI notification no. SEBI/ LAD-NRO/GN/2016-17/008 dated July
8, 2016 and Regulation 43A of the SEBI (LODR) Regulations, 2015; the Dividend Distribution Policy of the Company is available on the website of the Company, www.repcohome. com/new_site/corporate_governance.php.
TRANSFER TO Reserves
During the year under review, your Company transferred Rs. 20 crore to the General Reserve, Rs. 51.10 crore to the Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Sec 29 C of NHB Act, 1987 and Rs.36.46 crore to additional reserve under Sec 29C of NHB Act, 1987, out of the amount available for appropriation. An amount of Rs. 235.95 crore is proposed to be retained in the profit and loss account.
CHANGES IN SHARE CAPITAL
During the financial year, the paid up capital increased consequent to the allotment of 19,925 equity shares of face value of Rs.10 each upon exercise of employee stock options under ESOS (Phase-I and Phase-II). Consequently, the equity share capital of the Company has increased from Rs. 62,54,14,370 divided into 6,25,41,437 Equity shares of Rs. 10 each to Rs. 62,56,13,620 divided into 6,25,61,362 Equity shares of Rs. 10 each.
STATE OF AFFAIRS OF THE COMPANY
The Company endeavors towards adopting the benchmark underwriting practices backed up by robust monitoring and recovery mechanisms. The Company''s committed in its efforts towards improving efficiency and service level in its operations.
LENDING OPERATIONS
1) Sanctions
During the year, loan approvals stood at Rs. 2,875.75 crore as compared to Rs.3082.76 crore in the previous year . The cumulative loan sanctions since inception of the Company stood at Rs. 15,603.32 crore at the end of the financial year 2016-17.
2) Disbursements
During the year under review, the Company disbursed loans to the extent of Rs.2,642.39 crore as against Rs.2,851.20 crore in the previous year. The Cumulative disbursements stood at Rs. 14,374.43 crore in respect of 1,17,185 accounts at the end of the financial year 2016-17.
3) Loans Outstanding
The loan book of the Company at the end of financial year 2016-17 was Rs.8,939.91 crore as against Rs.
7,691.19 crore in the previous year representing a growth of 16.24%.
NON PERFORMING ASSETS
As of 31 March 2017, the gross NPA of the Company was Rs. 232.84 crore (previous year Rs. 100.87 crore) constituting 2.60% (previous year 1.31%) of the total loans outstanding. Net NPA of the Company as at March 31, 2017 was 1.39% as against 0.48% in the corresponding period of the previous year. The NPA provision coverage ratio stood at 47.29% (previous year 63.54%) as at 31st March 2017. The Company carries a provision of Rs.110.10 crore (previous year Rs.64.10 crore) towards its Non Performing Assets at the end of the financial year 2016-17. During the period under review, the Company has written off Rs.0.50 crore (previous year Rs.0.34 crore) in respect of loans where recovery had been rendered impracticable.
REGULATORY COMPLIANCE
The Company is in compliance with the guidelines, circulars and directions of National Housing Bank. The Company is also in compliance with the Companies Act 2013, guidelines, directions and circulars of MCA, SEBI etc. The Company complied with Mandatory Accounting Standards as prescribed under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules
2014, and other related statutory Guidelines / Directions as applicable to the Company from time to time. The Company is registered with the Central Registry of Securitization, Asset Reconstruction and Security Interest of India (CERSAI) and furnishes information in respect of its loans. Compliance of all regulatory guidelines to NHB / other status are periodically reviewed at Audit Committee / Board of the Company.
The Company''s capital adequacy ratio as on 31 March 2017 was 21.25% (previous year 20.77%) which is well above the prescribed 12% threshold as per NHB Directions. This consisted entirely of Tier 1 capital.
As per the directions of the National Housing Bank, a provision of Rs. 5.23 crore (previous year Rs.9.52 crore) being charged to statement of Profit & Loss Account of the financial year 2016-17 in respect of standard assets and the cumulative provision in respect of standard assets stood at Rs.40.24 crore (previous year Rs. 35.01 crore) as at 31st March 2017.
FINANCIAL RESOURCES REFINANCE FROM NHB
During the year the Company had availed a refinance of Rs. 500 crore from National Housing Bank. The refinance outstanding at the end of the year was Rs. 1,170.10 crore (previous year Rs.910.94 crore)
TERM LOANS FROM BANKS AND FINANCIAL INSTITUTIONS
The outstanding borrowings from Banks and Financial Institutions (terms loans and overdraft) at the end of the financial year stood at Rs. 5,255.33 crore (previous year Rs. 5,226.97 crore).
SECURED NON Convertible DEBENTURES
In its continuing efforts to reduce the cost of fund, the Company during the year, the company has issued SRNCDs aggregating to Rs.385 crores (previous year Rs.300 crores). The outstanding SRNCDs as on 31st March 2017 was Rs. 785 crores (previous year Rs.400 crores). These instruments have been rated "ICRA AA-" by M/s. ICRA Ltd., and "CARE AA" by M/s. CARE Ltd.,
COMMERCIAL PAPERS
The Company''s commercial paper is rated A1 by M/s. ICRA Ltd., and CARE Ltd., implying highest safety. During the financial year 2016-17, the Company has raised funds amounting to Rs. 1,400 crores (previous year Rs.1250 crores) by way of issuance of commercial paper. After repayments on maturity, the net amount outstanding as at 31st March 2017, was Rs.350 crores. (Previous year NIL).
UNCLAIMED NCDS
According to section 125 of the Companies Act, 2013, NCDs and interest thereon remaining unclaimed and unpaid for a period of seven years from the date they became due are required to be credited to the Investor Education and Protection Fund (IEPF) set up by the Government of India. As at 31 March 2017 there are no non convertible debentures amount or interest thereon remaining unpaid or unclaimed.
Disclosure under Housing Finance Companies issuance of Non Convertible Debentures on private placement basis, (NHB) Directions 2014.
There are no Non Convertible Debentures which have not been claimed by the Investors or which were not paid by the Company after the date on which the Non Convertible Debentures became due for redemption. There were no NCDs falling due for redemption in FY 2016-17. Further the Company has paid the interest on respective due dates.
UNCLAIMED Dividends
As of 31 March 2017, dividend amounting to Rs. 46,432 (previous year Rs.38,378) has not been claimed by the investors. According to section 125 of the Companies Act,
2013 dividends remaining unclaimed for a period of seven years from the date they became due are required to be credited to the Investor Education and Protection Fund (IEPF) set up by the Government of India. In accordance with the Investor Education Fund (Uploading of information regarding unpaid and unclaimed amount lying with the Companies) Rules 2012, the Company has uploaded this information on www.iepf.gov.in and www.repcohome.com/ new_site/unclaimed_dividend.php.
PUBLIC DEPOSITS
The Company has not accepted deposits from the public during the financial year 2016-17.
RISK MANAGEMENT
The Company has in place a risk management policy framework which has been approved by the Board of Directors. The framework codifies the various risks and the methodologies to ensure such risks are mitigated. The Company has in place a Management & Risk Management Committee comprising of Shri. Thomas Paul Diamond (Chairman), Shri. G.R. Sundaravadivel (Director), Shri. V. Nadanasabapathy (Director) and Shri. R. Varadarajan (Managing Director).
HUMAN RESOURCES
The objective of human resource development in an organization is to enhance human productivity through progressive and consistent policies in knowledge & skill up gradation and betterment of employment conditions at all levels. Human Resource Management''s objective is to maximize the return on investment from the organization''s human capital. It is the responsibility of human resource/ development department in a corporate context to conduct these activities in an effective, legal, impartial and cohesive manner.
Your Company worked tirelessly towards the performance up gradation of its employees by introducing objective performance appraisal mechanism and performance linked incentive structure. Employees are also nominated regularly to attend various training programmes conducted by NHB, ICSI& other capacity building institutions besides in-house training programmes for constant skill up gradation. During the financial year the Company conducted 14 in-house training programmes and employees were nominated for 7 external programmes.
The Company provides a professional work environment and maintains a healthy relation with its employees.
As on 31 March 2017, the number of people employed by the Company stood at 670.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of women at the workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The following is a summary of sexual harassment complaints received and disposed off during the year 2016-17.
- No. of complaints received: NIL
- No of complaints disposed off: NOT APPLICABLE
PARTICULARS OF EMPLOYEES COVERED UNDER COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL RULES, 2014.
There were no employee who was in receipt of remuneration of Rs 1.02 crore or more per annum.
In accordance with the provisions of section 197 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, the name and other particulars of such employees are set out in the annex to the Directors'' Report. However, as per the provisions of section 136 of the Companies Act, 2013, the Directors'' Report is being sent to all shareholders of the Company excluding the annex. The annex is available for inspection by the members at the registered office of the Company during business hours on working days up to the date of ensuing Annual General Meeting. Any shareholder interested in obtaining a copy of the said annex may write to the company secretary at the registered office of the Company.
CORPORATE SOCIAL RESPONSIBILITY
As per Section 135 of the Companies Act, 2013 and the rules framed there under, the Company has in place a Corporate Social Responsibility Committee of Directors comprising of Shri. Thomas Paul Diamond-Chairman, Shri. G.R. Sundaravadivel and Shri. V. Nadanasabapathy and has inter alia formulated a Corporate Social Responsibility Policy.
This Committee envisages the activities to be undertaken in pursuance of CSR initiatives. During the year the Company spent a sum of Rs. 0.19 crore towards CSR initiatives. The Annual Report on CSR activities forming part of the Directors'' Report is furnished as Annexure-1 to this report.
EMPLOYEE STOCK OPTION SCHEME:
The employee stock options granted to the employees operate under the RHFl-ESOP Scheme 2013. No stock options were granted during the year. There are no material changes to this scheme and the said scheme is in compliance with the extant regulations prescribed by the Securities and Exchange Board of India in this regard. The disclosures as prescribed by the "Guidance Note on accounting for employee share based payments" issued by ICAI and the Diluted EPS on issue of shares pursuant to the Scheme in accordance with the Accounting Standard 20- Earnings per share" issued by ICAI are disclosed on the website of the Company. The disclosures as required by the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations 2014 have been placed on the website of the Company.
PARTICULARS RELATING TO CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
Particulars relating to conservation of energy and technology absorption stipulated in the Companies (Accounts) Rules 2014 are not applicable to the Company and further the Company has no foreign exchange earnings but incurred foreign exchange expenditure to the extent of Rs.0.04 crore (previous year Rs.0.13 crore) towards travelling and other foreign expenses.
DIRECTORS
In accordance with Section 152 of the Companies Act, 2013, Shri. L. Munishwar Ganesan, Director of the Company is liable to retire by rotation at the ensuing annual general meeting and is eligible for reappointment. The resolution for his re-appointment forms a part of the notice convening the Annual General Meeting. The details pertaining to the re-appointment are elucidated in the explanatory statement to the notice convening the Annual General Meeting.
All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015 (''Listing Regulations'').
The details of familiarization programmes to Independent Directors is put up on the website of the Company.
DETAILS OF MANAGERIAL REMUNERATION AS REQUIRED UNDER COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014
The particulars of managerial remuneration as required by under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given as Annexure-2.
AUDITORS
In accordance with the requirement of the Companies Act, 2013 the current statutory auditors, M/s. R. Subramanian And Company LLB, current statutory auditors hold office up to the conclusion of the ensuing annual general meeting. As per the provisions of Section 139 of the Companies Act, 2013, the firm is not eligible for re-appointment. The Board of Directors places on record its appreciation for the services rendered by them.
The Board of Directors of the Company on the recommendation of the Audit Committee, has considered and recommended the appointment of M/s. S.R. Batliboi LLP Associates as statutory auditors for a term of five years beginning from the 17th Annual General Meeting to 22nd Annual General meeting subject to the approval of the members at the ensuing annual general meeting.
DIRECTORS'' RESPONSIBILITY STATEMENT
In pursuance of section 134 (3) (C) of the Companies Act, 2013, and based on the information provided by the Management, your Directors hereby confirm that:
a) in the preparation of the annual accounts, the applicable accounting standards have been followed;
b) Accounting policies selected were applied consistently. Reasonable and prudent judgments and estimates were made so as to give a true and fair view of the state of affairs of the company as at 31 March 2017 and of the profit and loss of the Company for that date;
c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) The annual accounts of the Company have been prepared on a going concern basis;
e) Internal financial controls have been followed by the Company and such internal financial controls are adequate and were operating effectively.
f) Systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.
INTERNAL CONTROL SYSTEMS
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.
The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board every quarter or at periodic intervals.
EXTRACTS OF THE ANNUAL RETURN (FORM MGT-9)
As required pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and
Administration) Rules, 2014, an extract of annual return in MGT 9 is annexed as a part of this report (Annexure-3).
SECRETARIAL AUDIT REPORT
In accordance with Section 204 of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, M/s. G Ramachandran & Associates, Company Secretaries were appointed by the Company to undertake Secretarial Audit of the Company. The Secretarial Audit Report is annexed to this report as Annexure-4.
Explanation on comments by the Board on Every qualification, reservation on adverse remark or disclaimer made by Auditor /Secretarial Auditor.
Neither the statutory auditor nor the secretarial auditor have made any qualification, reservation or adverse remark or disclaimer in their respective reports.
DETAILS OF LOANS GIVEN, GUARANTEES GIVEN OR SECURITY PROVIDED
The provisions contained in Section 186(11) of the Companies Act, 2013, relating to loans, guarantees or securities do not apply to the Company.
INVESTMENTS
The Company has investments in the equity of unlisted associate company, Repco Micro Finance Limited to the extent of Rs.15.60 Crore (1,56,00,000 equity shares of Rs.10/-each).
SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, your Company has prepared Consolidated Financial Statements of the Company which forms part of this Annual Report. Further, a Statement containing salient features of financial statements of the Subsidiary, joint venture entities and associate Companies in the prescribed format AOC-1, pursuant to Section 129(3) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, is annexed as Annexure-5 to this Report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1)
All the related party transactions entered during the year were in ordinary course of business and on arm''s length basis. The Company has obtained the shareholders'' approval for material related party transactions as required under Listing Regulations.
The Company presents a statement of all related party transactions before the Audit Committee. The details of such transactions are given in the accompanying financial statements.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE COMPANY BETWEEN 31ST MARCH 2017 AND THE DATE OF BOARD''S REPORT.
There has been no material changes and commitment, affecting the financial position of the Company which has occurred between the end of the financial year to which the financial statements relate and the date of the report.
The Company does not have any subsidiary. There has been no change in the nature of business of the Company. No significant or material Orders have been passed by the regulators or Courts or Tribunals impacting the going concern status of the Company and / or the Company''s operations in future.
MANAGEMENT DISCUSSION AND ANALYSIS
In accordance with the SEBI (LODR) Regulations, 2015, Management Discussion and Analysis Report for the year under review, is presented in a separate section which forms a part of this report.
REPORT ON CORPORATE GOVERNANCE
In accordance with the SEBI (LODR) Regulations, 2015, the report on corporate governance for the year under review is presented in a separate section which forms a part of this report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Board of Directors has approved the vigil mechanism/ whistle blower policy of the Company which provides a framework to promote a responsible and secure whistle blowing. It protects employees wishing to raise a concern about serious irregularities within the Company. It provides for a vigil mechanism to channelize reporting of such instances/ complaints/ grievances to ensure proper governance. The Audit Committee oversees the vigil mechanism. No employee has been denied access to the Audit Committee. The policy is placed on the website of the Company, www.repcohome.com/new_site/corporate_ governance.php.
LISTING
The shares of your Company are listed at National Stock Exchange Limited and Bombay Stock Exchange Limited. Listing fee has already been paid for the financial year 2016-17.
OTHERS
The Dividend Distribution Policy of the Company is available on the website of the Company, www.repcohome.
com/new_site/corporate_governance.php and forms part of this report as Annexure -6 to this report.
As required by NHB notification no. NHB.HFC.CG-DIR.1/ MD&CEO/2016 dated February 9, 2017, a policy on Transactions with Related Parties is given as ''Annexure-7'' to this report.
BUSINESS RESPONSIBILITY REPORTING
In accordance with the requirement under Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) (LODR) Regulations, 2015, Business Responsibility Report forms part of the Directors'' Report and is annexed as ''Annexure-8'' to this report.
NHB''S OBSERVATION
National Housing Bank vide its letters number NHB(ND)/ DRS/Sup./3614/2016-17 dated April 7, 2017 and NHB(ND)/ DRS/Sup.7632/2017-18 dated July 21, 2017 with reference to the inspection pertaining to the position as of 31-3-2016, advised that the company''s Net Owned Fund (NOF) and Capital Adequacy Ratio (CAR) was Rs. 913.25 crore and 20.70% respectively as against Rs. 915.95 crore and 20.77% worked out by the company as on that date. The difference was attributed to additional provisioning due to reclassification of advances with consequential reversal of income and netting the provisions made towards standard advances etc.
ACKNOWLEDGEMENTS
The Directors of your Company wish to place on record their sincere gratitude to the National Housing Bank and its Executives for continuous guidance and support. We also record our gratitude to our bankers, financial institutions and insurance companies for their continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to Ministry of Home Affairs, GOI, SEBI, NSE, BSE, Department of Company Affairs, REPCO Bank, shareholders, Government, local/statutory authorities, customers and all the other stakeholders for their patronage and support for the achievements by the Company despite the most competitive environment in the market.
Your Directors take this opportunity to thank all the executives and employees of the Company and wish to place on record their commendable hard work, team spirit and dedicated service to the customers which enabled the Company to achieve an appreciable level of business performance during the year.
For and on behalf of the Board of Directors
Date : August 4, 2017 (T.S. KrishnaMurthy)
Place : Chennai Chairman
Mar 31, 2016
The Company''s financial performance for the financial year ended March
31, 2016, is summarized below:
(Rs in crore)
Particulars Standalone Consolidated
2015-16 2014-15 2015-16 2014-15
Profit Before Tax 230.08 186.17 230.08 186.17
Less : Provision for
Taxation
Current Year 74.22 55.92 74.22 55.92
Deferred 5.78 7.17 5.78 7.17
Profit after tax 150.08 123.08 150.08 123.08
Add : Net share of
profit from Associate - - 3.98 2.26
Add : Balance brought
forward from the
previous year 115.60 89.79 120.78 93.20
Less: Utilised during
the current year for
depreciation - 0.21 - 0.21
charged in accordance
with Schedule II
Companies Act 2013
Less: Dividend
received from
Associate credited to - - 0.75 0.49
carrying value of
investment
Amount available for
appropriations 265.68 212.66 274.09 217.84
Appropriations
Transferred to
additional reserve
U/s 29C of the NHB
Act, 1987 30.02 24.62 30.02 24.62
Transferred to
Statutory Reserve
under Section 36(1) 40.85 41.13 40.85 41.13
(viii) of the
Income Tax Act,
1961 read with
Section 29C of
National Housing
Bank Act, 1987
Transferred to
General Reserve 20.00 20.00 20.00 20.00
Proposed Equity Dividend 11.26 9.35 11.26 9.35
Tax on Dividends 2.29 1.96 2.29 1.96
Balance carried over
to Balance Sheet 161.26 115.60 169.67 120.78
Total 265.68 212.66 274.09 217.84
Earnings Per Share:
Basic (Rs.) 24.04 19.78 24.68 20.14
Diluted (Rs.) 24.03 19.71 24.66 20.04
DIVIDEND
Your Directors recommend a dividend of Rs.1.80 per equity share of face
value of Rs.10.00 each for the year ended 31 March 2016 as against a
dividend of Rs.1.50 per equity share of face value of Rs.10.00 each for
the previous year. The dividend payout ratio for the year is 9.03%
(amounting to Rs.13.55 crore, inclusive of Tax on dividend) as against
9.19% (amounting to Rs.11.31 crore, inclusive of Tax on dividend) in
the previous year.
In compliance with requirements stipulated vide SEBI notification no.
SEBI/ LAD-NRO/GN/2016-17/008 dated July 8, 2016; the Dividend
Distribution Policy of the Company is available on the website of the
Company, www.repcohome.com/new_site/corporate_governance. php
TRANSFER TO RESERVES
During the year under review, your Company transferred Rs.20 crore to
the General Reserve, Rs.40.85 crore to the Statutory Reserve under
Section 36(1)(viii) of the Income Tax Act, 1961 read with Sec 29 C of
NHB Act, 1987 and Rs. 30.02 crore to additional reserve under Sec 29C
of NHB Act, 1987, out of the amount available for appropriation. An
amount of Rs. 161.26 crore is proposed to be retained in the profit and
loss account.
CHANGES IN SHARE CAPITAL
During the financial year, the paid up capital increased consequent to
the allotment of 1,83,790 equity shares of face value of Rs.10 each
upon exercise of employee stock options under ESOP (Phase-I and
Phase-II). Consequently, the equity share capital of the Company has
increased from Rs.62,35,76,470 divided into 6,23,57,647 Equity shares
of Rs. 10 each to Rs.62,54,14,370 divided into 6,25,41,437 Equity
shares of Rs. 10 each.
STATE OF AFFAIRS OF THE COMPANY
The Company endeavors towards adopting the benchmark underwriting
practices backed up by robust monitoring and recovery mechanisms. The
Company''s committed in its efforts towards improving efficiency and
service level in its operations.
LENDING OPERATIONS
1) Sanctions
During the year, loan approvals stood at Rs.3,082.76 crore as compared
to Rs.2,398.88 crore in the previous year registering a growth of
28.51%. The cumulative loan sanctions since inception of the Company
stood at Rs.12,727.57 crore at the end of the financial year 2015-16.
2) Disbursements
During the year under review, the Company disbursed loans to the extent
of Rs. 2,851.20 crore as against Rs.2,181.15 crore in the previous
year, a growth of 30.72%. The Cumulative disbursements stood at
Rs.11,732.04 crore in respect of 1,00,854 accounts at the end of the
financial year 2015-16.
3) Loans Outstanding
The loan book of the Company at the end of financial year 2015-16 was
Rs.7,691.19 crore as against Rs.6,012.92 crore in the previous year
representing a growth of 27.91%.
NON PERFORMING ASSETS
As of 31 March 2016, the gross NPA of the Company was Rs.100.87crore
(previous year Rs.79.12 crore) constituting 1.31% (previous year 1.32%)
of the total loans outstanding. Net NPA of the Company as at March 31,
2016 was 0.48% as against 0.50% in the corresponding period the
previous year. The NPA provision coverage ratio stood at 63.54%
(previous year 62.37%) as at 31st March 2016. The Company carries a
provision of Rs.64.10 crore (previous year Rs.49.34 crore) towards its
Non Performing Assets at the end of the financial year 2015-16. During
the period under review, the Company has written off Rs.0.34 crore
(previous year Rs.0.13 crore) in respect of loans where recovery had
been rendered impracticable.
REGULATORY COMPLIANCE
The Company is in compliance with the guidelines, circulars and
directions of National Housing Bank. The Company is also in compliance
with the Companies Act 2013, guidelines, directions and circulars of
MCA, SEBI etc. The Company complied with Mandatory Accounting Standards
as prescribed under Section 133 of the Companies Act, 2013 read with
Rule 7 of the Companies (Accounts) Rules 2014, and other related
statutory Guidelines / Directions as applicable to the Company from
time to time. The Company is registered with the Central Registry of
Securitization, Asset Reconstruction and Security Interest of India
(CERSAI) and furnishes information in respect of its loans. Compliance
of all regulatory guidelines to NHB / other status are periodically
reviewed at Audit Committee / Board of the Company.
The Company''s capital adequacy ratio as on 31 March 2016 was 20.77%
(previous year 20.26%) which is well above the prescribed 12% threshold
as per NHB Directions. This consisted entirely of Tier 1 capital.
As per the directions of the National Housing Bank, a provision of Rs.
9.52 crore (previous year Rs.5.76 crore) being charged to statement of
Profit & Loss Account of the financial year 2015-16 in respect of
standard assets and the cumulative provision in respect of standard
assets stood at Rs. 35.01 crore (previous year Rs. 25.49 crore) as at
31st March 2016.
FINANCIAL RESOURCES REFINANCE FROM NHB
During the year the Company had received a refinance sanction of Rs.
500 crore (previous year Rs. 300 crore) from National Housing Bank. The
refinance outstanding at the end of the year was Rs. 910.94 crore
(previous year Rs.1,094.80 crore)
TERM LOANS FROM BANKS AND FINANCIAL INSTITUTIONS
The outstanding bank borrowings (terms loans and overdraft) at the end
of the financial year stood at Rs.5,226.97 crore (previous year Rs.
3,849.63 crore).
SECURED NON CONvERTIBLE DEBENTURES
In its continuing efforts to reduce the cost of fund, the Company
during the year, started mobilising funds through issuing Secured,
Redeemable, Non- Convertible, Non-Cumulative, Taxable Debentures
(SRNCD) and Commercial Paper (CP). During the year, the Company has
issued SRNCDs aggregating to Rs.300 crore (previous year Rs.100 crore).
The out- standing SRNCDs as on 31st March 2016 was Rs.400 crore
(previous year Rs.100 crore). These instruments have been rated "ICRA
AA-" by M/s.ICRA Ltd., and "CARE AA" by M/s.CARE Ltd.,
COMMERCIAL PAPERS
The Company''s commercial paper is rated A1 by M/s. ICRA Ltd., and CARE
Ltd., implying highest safety. During the financial year 2015-16, the
Company has raised funds amounting to Rs.1250 crore (previous year
Rs.110 crore) by way of issuance of commercial paper. After repayments
on maturity, the net amount outstanding as at 31st March 2016, was NIL.
(Previous year Rs.60.00 crore).
UNCLAIMED NCDS
According to section 125 of the Companies Act, 2013, NCDs and interest
thereon remaining unclaimed and unpaid for a period of seven years from
the date they became due are required to be credited to the Investor
Education and Protection Fund (IEPF) set up by the Government of India.
As at 31 March 2016 there are no non convertible debentures amount or
interest thereon remaining unpaid or unclaimed.
DISCLOSURE UNDER HOUSING FINANCE COMPANIES ISSUANCE OF NON CONVERTIBLE
DEBENTURES ON PRIVATE PLACEMENT BASIS, (NHB) DIRECTIONS 2014.
There are no Non Convertible Debentures which have not been claimed by
the Investors or which were not paid by the Company after the date on
which the Non Convertible Debentures became due for redemption. There
were no NCDs falling due for redemption in FY 2015-16. Further the
Company has paid the interest on respective due dates.
UNCLAIMED DIVIDENDS
As of 31 March 2016, dividend amounting to Rs.38,378 (previous year
Rs.25,673) has not been claimed by the investors. According to section
125 of the Companies Act , 2013 dividends remaining unclaimed for a
period of seven years from the date they became due are required to be
credited to the Investor Education and Protection Fund (IEPF) set up by
the Government of India. In accordance with the Investor Education Fund
(Uploading of information regarding unpaid and unclaimed amount lying
with the Companies) Rules 2012, the Company has uploaded this
information on www.iepf.gov.in and www.repcohome.com/new_site/
unclaimed_dividend.php.
PUBLIC DEPOSITS
The Company has not accepted deposits from the public during the
financial year 2015-16.
RISK MANAGEMENT
The Company has in place a risk management policy framework which has
been approved by the Board of Directors. The framework codifies the
various risks and the methodologies to ensure such risks are mitigated.
The Company has in place a Management & Risk Management Committee
comprising of Shri. Thomas Paul Diamond (Chairman), Shri. G.R.
Sundaravadivel (Director), Shri. V. Nadanasabapathy (Director) and
Shri. R. Varadarajan (Managing Director).
HUMAN RESOURCES
The objective of human resource development in an organization is to
enhance human productivity through progressive and consistent policies
in knowledge & skill upgradation and betterment of employment
conditions at all levels. Human Resource Management''s objective is to
maximize the return on investment from the organization''s human
capital. It is the responsibility of human resource/development
department in a corporate context to conduct these activities in an
effective, legal, impartial and cohesive manner.
Your Company worked tirelessly towards the performance upgradation of
its employees by introducing objective performance appraisal mechanism
and performance linked incentive structure. Employees are also
nominated regularly to attend various training programmes conducted by
NHB, ICSI & other capacity building institutions besides in-house
training programmes for constant skill upgradation. During the
financial year the Company conducted 5 in-house training programmes and
employees were nominated for 8 external programmes.
The Company provides a professional work environment and maintains a
healthy relation with its employees. As on 31 March 2016, the number
of people employed by the Company stood at 619.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has in place an Anti-Sexual Harassment Policy in line with
the requirements of the Sexual Harassment of women at the workplace
(Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints
Committee (ICC) has been set up to redress complaints received
regarding sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy.The following is a
summary of sexual harassment complaints received and disposed off
during the year 2015-16
a. No. of complaints received: 1
b. No of complaints disposed off: 1
CORPORATE SOCIAL RESPONSIBILITY
As per Section 135 of the Companies Act, 2013 and the rules framed
thereunder, the Company has in place a Corporate Social Responsibility
Committee of Directors comprising of Shri. Thomas Paul
Diamond-Chairman, Smt.SanjeevaneeKutty, I.A.S., Shri.G.R.Sundaravadivel
and Shri. V. Nadanasabapathy and has inter alia formulated a Corporate
Social Responsibility Policy.
This Committee envisages the activities to be undertaken in pursuance
of CSR initiatives. During the year the Company spent a sum of Rs.0.24
crore towards CSR initiatives. The Annual Report on CSR activities
forming part of the Directors'' Report is furnished as Annexure-1 to
this report.
EMPLOYEE STOCK OPTION SCHEME:
The employee stock options have been granted to the eligible employees
and the Managing Director in pursuance of "Repco Home Finance Limited
Employees Stock Option Scheme - 2013". There are no material changes to
this scheme and the said scheme is in compliance with the extant
regulations prescribed by the Securities and Exchange Board of India in
this regard. The disclosures as prescribed by the "Guidance Note on
accounting for employee share based payments" issued by ICAI and the
Diluted EPS on issue of shares pursuant to the Scheme in accordance
with the Accounting Standard 20- Earnings per share" issued by ICAI are
disclosed on the website of the Company. The disclosures as required by
the Securities and Exchange Board of India (Share Based Employee
Benefits) Regulations 2014 are furnished as Annexure 2 to this report.
PARTICULARS RELATING TO CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION
AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
Particulars relating to conservation of energy and technology
absorption stipulated in the Companies (Accounts) Rules 2014 are not
applicable to the Company and further the Company has no foreign
exchange earnings but incurred foreign exchange expenditure to the
extent of Rs.0.13 crore (previous year Rs.0.10 crore) towards
travelling and other foreign expenses.
DIRECTORS
In accordance with Section 152 of the Companies Act, 2013, Smt.
Sanjeevanee Kutty, I.A.S, Director of the Company is liable to retire
by rotation at the ensuing annual general meeting and is eligible for
reappointment. The resolution for her re-appointment forms a part of
the notice convening the Annual General Meeting. The details pertaining
to the re-appointment are elucidated in the explanatory statement to
the notice convening the Annual General Meeting.
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013 and SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (''Listing Regulations'').
The details of familiarization programmes to Independent Directors is
put up on the website of the Company.
DETAILS OF MANGERIAL REMUNERATION AS REQUIRED UNDER COMPANIES
(APPOINTMENT AND REMUNERATION OF MANGERIAL PERSONNEL) RULES, 2014
The particulars of managerial remuneration as required by under Rule
5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 is given as Annexure-3.
AUDITORS
M/s. R. Subramanian and Company LLP, retire at the conclusion of the
forthcoming Annual General Meeting. The Board of Directors recommend
the appointment of M/s. R. Subramanian and Company LLP for the
financial year 2016-17.
The Company has received a confirmation from M/s. R.Subramanian and
Company, LLP to the effect that their appointment if made, at the
ensuing Annual General Meeting would be in accordance with Sections 139
and 141 of the Companies Act 2013.
DIRECTORS'' RESPONSIBILITY STATEMENT
In pursuance of section 134 (3) ( C ) of the Companies Act, 2013, and
based on the information provided by the Management, your Directors
hereby confirm that:
a) in the preparation of the annual accounts, the applicable accounting
standards have been followed;
b) Accounting policies selected were applied consistently. Reasonable
and prudent judgments and estimates were made so as to give a true and
fair view of the state of affairs of the company as at 31 March 2016
and of the profit and loss of the Company for that date;
c) Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
d) The annual accounts of the Company have been prepared on a going
concern basis;
e) Internal financial controls have been followed by the Company and
such internal financial controls are adequate and were operating
effectively.
f) Systems to ensure compliance with the provisions of all applicable
laws were in place and that such systems were adequate and operating
effectively.
INTERNAL CONTROL SYSTEMS
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. To maintain its objectivity and
independence, the Internal Audit function reports to the Chairman of
the Audit Committee of the Board.
The Internal Audit Department monitors and evaluates the efficacy and
adequacy of internal control system in the Company, its compliance with
operating systems, accounting procedures and policies at all locations
of the Company. Significant audit observations and corrective actions
thereon are presented to the Audit Committee of the Board every quarter
or at periodic intervals.
EXTRACTS OF THE ANNUAL RETURN (FORM MGT-9)
As required pursuant to section 92(3) of the Companies Act, 2013 and
rule 12(1) of the Companies (Management and Administration) Rules,
2014, an extract of annual return in MGT 9 is annexed as a part of this
report (Annexure-4).
SECRETARIAL AUDIT REPORT
In accordance with Section 204 of the Companies Act, 2013 and Rule 9 of
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules 2014, M/s.G Ramachandran & Associates, Company Secretaries were
appointed by the Company to undertake Secretarial Audit of the Company.
The Secretarial Audit Report is annexed to this report as Annexure-5.
Explanation on comments by the Board on Every qualification,
reservation on adverse remark or disclaimer made by Auditor
/Secretarial Auditor.
Neither the statutory auditor nor the secretarial auditor have made any
qualification, reservation or adverse remark or disclaimer in their
respective reports.
DETAILS OF LOANS GIVEN, GUARANTEES GIVEN OR SECURITY PROVIDED
The provisions contained in Section 186(11) of the Companies Act, 2013,
relating to loans, guarantees or securities do not apply to the
Company.
INVESTMENTS
The Company has investments in the equity of unlisted associate
company, Repco Micro Finance Limited to the extent of Rs.12.40 Crore
(124,00,000 equity shares of Rs.10/- each).
SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES
Pursuant to the provisions of Section 129(3) of the Companies Act,
2013, your Company has prepared Consolidated Financial Statements of
the Company which forms part of this Annual Report. Further, a
Statement containing salient features of financial statements of the
Subsidiary, joint venture entities and associate Companies in the
prescribed format AOC-1, pursuant to Section 129(3) of the Companies
Act, 2013 read with the Companies (Accounts) Rules, 2014, is annexed as
Annexure-6 to this Report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED
TO IN SECTION 188(1)
All the related party transactions entered during the year were in
ordinary course of business and on arm''s length basis. The Company has
obtained the shareholders'' approval for material related party
transactions as required under Listing Regulations.
The Company presents a statement of all related party transactions
before the Audit Committee. The details of such transactions are given
in the accompanying financial statements.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE
COMPANY BETWEEN 31ST MARCH 2016 AND THE DATE OF BOARD''S REPORT.
There has been no material changes and commitment, affecting the
financial position of the Company which has occurred between the end of
the financial year to which the financial statements relate and the
date of the report.
The Company does not have any subsidiary. There has been no change in
the nature of business of the Company. No significant or material
Orders have been passed by the regulators or Courts or Tribunals
impacting the going concern status of the Company and / or the
Company''s operations in future.
MANAGEMENT DISCUSSION AND ANALYSIS
In accordance with the SEBI (LODR) Regulations, 2015, Management
Discussion and Analysis Report for the year under review, is presented
in a separate section which forms a part of this report.
REPORT ON CORPORATE GOVERNANCE
In accordance with the SEBI (LODR) Regulations, 2015, the report on
corporate governance for the year under review is presented in a
separate section which forms a part of this report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Board of Directors has approved the vigil mechanism/whistle blower
policy of the Company which provides a framework to promote a
responsible and secure whistle blowing. It protects employees wishing
to raise a concern about serious irregularities within the Company. It
provides for a vigil mechanism to channelize reporting of such
instances/ complaints/ grievances to ensure proper governance. The
Audit Committee oversees the vigil mechanism. No employee has been
denied access to the Audit Committee. The policy is placed on the
website of the Company, www.
repcohome.com/new_site/corporate_governance.php.
LISTING
The shares of your Company are listed at National Stock Exchange
Limited and Bombay Stock Exchange Limited. Listing fee has already been
paid for the financial year 2016-17.
ACKNOWLEDGEMENTS
The Directors of your Company wish to place on record their sincere
gratitude to the National Housing Bank and its Executives for
continuous guidance and support. We also record our gratitude to our
bankers, financial institutions and insurance companies for their
continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to Ministry of Home
Affairs, GOI, SEBI, NSE, BSE, Department of Company Affairs, Repco Bank
Ltd, shareholders, Government, local / statutory authorities, customers
and all the other stakeholders for their patronage and support for the
achievements by the Company despite the most competitive environment in
the market.
Your Directors take this opportunity to thank all the executives and
employees of the Company and wish to place on record their commendable
hard work, team spirit and dedicated service to the customers which
enabled the Company to achieve an appreciable level of business
performance during the year.
For and on behalf of the Board of Directors
Date : August 06, 2016 (T.S.KrishnaMurthy)
Place : Chennai Chairman
Mar 31, 2015
DEAR MEMBERS,
The Directors have pleasure in presenting before you the Fifteenth
Annual Report of the Company together with the Audited Statement of
Accounts for the year ended 31 March 2015.
FINANCIAL RESULTS
(RS. in Crore)
2014-15 2013-14
Total Income 693.02 535.34
Profit Before Tax 186.17 149.13
a) Provision for Tax - Current Year 55.92 46.51
b) Deferred Taxation 7.17 (7.48)
Profit After Tax 123.08 110.10
Add: Balance of Profit brought forward 89.79 64.84
from last year
Less : Utilised during the current year 0.21 -
for depreciation charged in accordance
with Schedule II Companies Act 2013
Amount Available for appropriation 212.66 174.94
Appropriation
Transfer to additional reserve U/s 29C 24.62 22.03
of the NHB Act,1987
Transfer to special Reserve U/s 36(i) 41.13 34.39
(viii) of the Income Tax Act, 1961
Transfer to General Reserve 20.00 20.00
Proposed Dividend 9.35 7.46
Tax on proposed Dividend 1.96 1.27
Surplus carried to Balance Sheet 115.60 89.79
DIVIDEND
Your Directors recommend a dividend of Rs.1.50 per equity share of face
value of Rs.10.00 each for the year ended 31 March 2015. The dividend
payout ratio for the year is 9.19% (amounting to Rs. 11.31 crore,
inclusive of Tax on dividend) as against 7.93% (amounting to Rs. 8.73
crore, inclusive of Tax on dividend) in the previous year.
TRANSFER TO RESERVES
During the year under review, your Company transferred Rs.20 crore to
the General Reserve, Rs.41.13 crore to the Statutory Reserve under
Section 36(1)(viii) of the Income Tax Act, 1961 read with Sec 29 C of
NHB Act, 1987 and Rs. 24.62 crore to additional reserve under Sec 29 C
of NHB Act, 1987, out of the amount available for appropriation. An
amount of Rs. 115.60 crore is proposed to be retained in the profit and
loss account.
CHANGES IN SHARE CAPITAL
During the financial year, the paid up capital increased consequent to
the allotment of 1,96,600 equity shares of face value of Rs.10 each upon
exercise of employee stock options under ESOS (Phase-I). Consequently,
the equity share capital of the Company has increased from Rs.
62,16,10,470 divided into 6,21,61,047 Equity shares of Rs. 10 each to
Rs.62,35,76,470 divided into 6,23,57,647 Equity shares of Rs. 10 each.
STATE OF AFFAIRS OF THE COMPANY
The Company endeavors towards adopting the benchmark underwriting
practices backed up by robust monitoring and recovery mechanisms. The
Company is committed in its efforts towards improving efficiency and
service level in its operations.
LENDING OPERATIONS
1) Sanctions
During the year, loan approvals stood at Rs.2,398.88 crore as compared
to Rs.1,822.51 crore in the previous year registering a growth of
31.63%. The cumulative loan sanctions since inception of the Company
stood at Rs.9,644.81 crore at the end of the financial year 2014-15.
2) Disbursements
During the year under review, the Company disbursed loans to the extent
of Rs. 2,181.15 crore as against Rs.1,715.26 crore in the previous
year, a growth of 27.16%. The Cumulative disbursements stood at
Rs.8,880.84 crore in respect of 83,435 accounts at the end of the
financial year 2014-15.
3) Loans Outstanding
The loan book of the Company at the end of financial year 2014-15 was
Rs.6012.92 crore as against Rs.4,661.86 crore in the previous year
representing a growth of 28.98%.
NON PERFORMING ASSETS
As of 31 March 2015, the gross NPA of the company was Rs.79.12 crore
(previous year Rs.68.55 crore) constituting 1.32% (previous year 1.47%)
of the total loans outstanding. Net NPA of the Company as at March 31,
2015 was 0.50% as against 0.72% in the corresponding period the previous
year. The NPA provision coverage ratio stood at 62.37% (previous year
51.50%) as at 31st March 2015. The Company carries a provision of
Rs.49.34 crore (previous year Rs.35.30 crore) towards its Non Performing
Assets at the end of the financial year 2014-15. During the period under
review, the Company has written off Rs.0.13 crore (previous year Rs.
0.29 crore) in respect of loans where recovery had been rendered
impracticable.
REGULATORY COMPLIANCE
The Company is in compliance with the guidelines, circulars and
directions of National Housing Bank. The Company is also in compliance
with the Companies Act 2013, guidelines, directions and circulars of
MCA, SEBI etc. The company complied with Accounting Standards issued by
the ICAI and other related statutory Guidelines / Directions as
applicable to the Company from time to time. The Company is registered
with the Central Registry of Securitization, Asset Reconstruction and
Security Interest of India (CERSAI) and furnishes information in
respect of its loans. Compliance of all regulatory guidelines of NHB /
other compliances are periodically reviewed by the Audit Committee /
Board of the Company.
The Company's capital adequacy ratio as on 31 March 2015 was 20.26%
(previous year 24.50%) which is well above the prescribed 12% threshold
as per NHB Directions. This consisted entirely of Tier 1 capital.
As per the directions of the National Housing Bank, a provision of Rs.
5.76 crore (previous year Rs.4.72 crore) was charged to the Profit &
Loss Account of the financial year 2014-15 in respect of standard
assets and the cumulative provision in respect of standard assets stood
at Rs.25.49 crore (previous year Rs.19.73 crore) as at 31st March 2015.
During the year, National Housing Bank vide their circular 65/2014-15
dated August 22, 2014 directed Housing Finance Companies (HFCs) to
provide for DTL in respect of amount transferred to "Special Reserve"
created under Section 36(1)(viii) of the Income Tax Act 1961. NHB
further advised the HFCs that the DTL on Special Reserve as at March 31,
2014 could be created directly from the Reserves over a period of three
years starting with the current financial year, in a phased manner in
the ratio of 25:25:50. However the company has provided for the entire
DTL of Rs.45.73 crore on account of Special Reserve outstanding as at
31st March 2014 out of the general reserves outstanding at the beginning
of the year.
Further in respect of Special Reserve under section 36(1)(viii) created
during the current year, the company has recognized DTL of Rs.14.23
crore on such Special Reserve and charged to the profit and loss
account in accordance with the NHB guidelines.
FINANCIAL RESOURCES
REFINANCE FROM NHB
During the year, the Company had received a refinance sanction of Rs.
300 crore (previous year "NIL") from National Housing Bank. The company
availed refinance from National Housing Bank aggregating to Rs.450
crore (previous year Rs.100 crore) and refinance outstanding at the end
of the year was Rs.1,094.80 crore (previous year Rs.975.23 crore).
TERM LOANS FROM BANKS
The outstanding bank borrowings (terms loans and overdraft) at the end
of the financial year stood at Rs.3,849.63 crore (previous year Rs.
2,926.78 crore).
SECURED NON CONVERTIBLE DEBENTURES
In its continuing efforts to reduce the cost of fund, the Company
during the year, started mobilising funds through issuing Secured,
Redeemable, Non- Convertible, Non-Cumulative, Taxable Debentures
(SRNCD) and Commercial Paper (CP). During the year, the company has
issued SRNCDs aggregating to Rs.100 crore (previous year "NIL") with a
coupon rate of 9.55% per annum and tenor of three years. The
outstanding SRNCDs as on 31st March 2015 was Rs.100 crore (previous
year "NIL"). These instruments have been rated "ICRA AA-" by M/s. ICRA
Ltd., and "CARE AA - " by M/s. CARE Ltd.,
COMMERCIAL PAPERS
The Company's commercial paper is rated A1 by M/s. ICRA Ltd., and
CARE Ltd., implying highest safety. As at 31 March 2015, the
outstanding commercial paper was Rs.60 crore.
UNCLAIMED NCDs
According to section 125 of the Companies Act , 2013, NCDs and interest
thereon remaining unclaimed and unpaid for a period of seven years from
the date they became due are required to be credited to the Investor
Education and Protection Fund (IEPF) set up by the Government of India.
As at 31 March 2015 there are no non convertible debentures amount or
interest thereon remaining unpaid or unclaimed.
UNCLAIMED DIVIDENDS
As of 31 March 2015, dividend amounting to Rs.25,673 (previous year
Rs.6,452) has not been claimed by the investors. According to section
125 of the Companies Act, 2013, dividends remaining unclaimed for a
period of seven years from the date they became due are required to be
credited to the Investor Education and Protection Fund (IEPF) set up by
the Government of India. In accordance with the Investor Education Fund
(Uploading of information regarding unpaid and unclaimed amount lying
with the Companies) Rules 2012, the Company has uploaded this
information on www.iepf.gov.in and http://www.repcohome.com/
unclaimed.php.
RISK MANAGEMENT
The Company has in place a risk management policy framework which has
been approved by the Board of Directors. The framework codifies the
various risks and the methodologies to ensure such risks are mitigated.
The Company has in place a Management & Risk Management Committee
comprising of Shri. Thomas Paul Diamond (Chairman), Shri. G.R.
Sundaravadivel (Director), Shri. V. Nadanasabapathy (Director) and
Shri. R. Varadarajan (Managing Director).
HUMAN RESOURCES
The objective of human resources development in an organization is to
enhance human productivity through progressive and consistent policies
in knowledge & skill upgradation and betterment of employment
conditions at all levels. Human resource management's objective is to
maximize the return on investment from the organization's human
capital. It is the responsibility of human resources development
department in a corporate context to conduct these activities in an
effective, legal, impartial and cohesive manner.
Your Company worked tirelessly towards the performance upgradation of
its employees by introducing objective based performance appraisal
mechanism and performance linked incentive structure. Employees are
also nominated regularly to attend various training programmes
conducted by NHB, ICSI & other capacity building institutions besides
in-house training programmes for constant skill upgradation. During
the financial year, the Company conducted 8 in-house training
programmes and employees were nominated for 24 external programmes.
The Company provides a professional work environment and maintains a
healthy relation with its employees.
As on 31 March 2015, the number of people employed by the company stood
at 545.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The company has in place an Anti-Sexual Harassment Policy in line with
the requirements of the Sexual Harassment of women at the workplace
(Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints
Committee (ICC) has been set up to redress complaints received
regarding sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy.
The following is a summary of sexual harassment complaints received and
disposed off during the year 2014-15
a. No. of complaints received:1
b. No of complaints disposed off: 1
PARTICULARS OF EMPLOYEES COVERED UNDER COMPANIES (APPOINTMENT AND
REMUNERATION OF MANAGERIAL PERSONNEL RULES, 2014.
In pursuance of Rule 5(2) of the Companies (Appointment and
Remuneration of Managerial Personnel Rules, 2014), the Company has four
employees who were in receipt of remuneration of Rs.60 lacs or more per
annum.
The particulars of these employees are given below: (Rs in crore)
Sl Name of the Designation of Nature of Remuneration
No Employee the Employee Employment received
whether
contractual
or otherwise
1 Mr R Varadarajan Managing Regular 1.48
Director
2 Mr P Natarajan Executive Regular 0.98
Director
3 Mr V Raghu Executive Regular 0.98
Director
4 Mr K Ashok Chief General Regular 0.80
Manager
Sl Name of the Qualilications and Last
No Employee Experience Employment
Held before
joining the
Company
1 Mr R Varadarajan Qualification: Syndicate
* Master's degree Bank
in science
* Diploma in
management
* CAIIB
Experience:
37 yrs
2 Mr P Natarajan Qualification: Repco
* Bachelor's degree Bank
in Commerce
* JAIIB
Experience:
32 yrs
3 Mr V Raghu Qualification: Indian
* Master's degree Wind
in Economics Turbine
* Master's degree Manufacturer
in business Association
administration
* CAIIB
Experience:
34 yrs
4 Mr K Ashok Qualification: Syndicate
Post graduate Bank
in Agriculture
Experience:
26 yrs
Sl Name of the Equity Relative
No Employee Shares of
held by Director
the /Manager
employee
1 Mr R Varadarajan 31275 NO
shares
(0.05%)
2 Mr P Natarajan 17000 NO
shares
(0.03%)
3 Mr V Raghu 17000 NO
shares
(0.03%)
4 Mr K Ashok 15175 NO
shares
(0.03%)
In accordance with the provisions of Section 197 of the Companies Act,
2013, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, the name and other particulars of such employees are set
out in the table above.
CORPORATE SOCIAL RESPONSIBILITY
As per Section 135 of the Companies Act, 2013 and the rules framed
thereunder, the Company has in place a Corporate Social Responsibility
Committee of Directors comprising of Shri.Thomas Paul Diamond-Chairman,
Shri.B.Anand, I.A.S. , Shri.G.R.Sundaravadivel and
Shri.V.Nadanasabapathy and has inter alia formulated a Corporate Social
Responsibility Policy.
This Committee envisages the activities to be undertaken in pursuance
of CSR initiatives.
During the year, the Company spent a sum of Rs.0.13 crore towards CSR
initiatives. The Annual Report on CSR activities forming part of the
Directors' Report is furnished as Annexure-1 to this report.
EMPLOYEE STOCK OPTION SCHEME
The employee stock options have been granted to the eligible employees
and the Managing Director in pursuance of "Repco Home Finance Limited
Employees Stock Option Scheme -2013". There are no material changes to
this scheme and the said scheme is in compliance with the extant
regulations prescribed by the Securities and Exchange Board of India in
this regard. The disclosures as prescribed by the "Guidance Note on
accounting for employee share based payments" issued by ICAI and the
Diluted EPS on issue of shares pursuant to the Scheme in accordance
with the Accounting Standard 20- Earnings per share" issued by ICAI are
disclosed on the website of the Company and the web- link is
www.repcohome.com/ESOP. The disclosures as required by the Securities
and Exchange Board of India (Share Based Employee Benefits )
Regulations 2014 are furnished as Annexure 2 to this report.
PARTICULARS RELATING TO CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION
AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
Particulars relating to conservation of energy and technology absorption
stipulated in the Companies (Accounts) Rules 2014 are not applicable to
the Company and further the Company has no foreign exchange earnings but
incurred foreign exchange expenditure to the extent of Rs.0.10 crore
(previous year Rs.0.04 crore) towards travelling expenses.
DIRECTORS
In accordance with Section 152 of the Companies Act, 2013, Shri.B.Anand
I.A.S., Director of the Company is liable to retire by rotation at the
ensuing annual general meeting and is eligible for reappointment. The
resolution for his re-appointment forms a part of the notice convening
the annual general meeting. The details pertaining to the
re-appointment are elucidated in the explanatory statement to the
notice convening the annual general meeting.
During the year, the Board of Directors had appointed Shri.Munishwar
Ganesan and Smt.Sanjeevanee Kutty, I.A.S. as Additional Directors on 02
February 2015 and 27 March 2015 respectively. Shri.Dilip Kumar,I.A.S.
has been appointed as Additional Director on 07 August 2015. They hold
office till the conclusion of the ensuing annual general meeting.
The resolutions for the appointments of Shri.Munishwar Ganesan,
Smt.Sanjeevanee Kutty, I.A.S. and Shri.Dilip Kumar,I.A.S. as Directors
forms a part of the notice convening the annual general meeting. The
details pertaining to these appointments are elucidated in the
explanatory statement to the notice convening the annual general
meeting.
The Company has obtained a confirmation from the aforesaid directors
that they have not incurred any disqualification prohibiting their
appointment as Directors as envisaged under Section 164 of the
Companies Act, 2013.
DETAILS OF MANAGERIAL REMUNERATION AS REQUIRED UNDER COMPANIES
(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014
The particulars of managerial remuneration as required under Rule 5 (1)
of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 is given as Annexure-3.
AUDITORS
M/s. R.Subramanian And Company retire at the conclusion of the
forthcoming annual general meeting. The Board of Directors recommend the
appointment of M/s.R.Subramanian And Company for the financial year
2015-16.
The Company has received a confirmation from M/s. R.Subramanian and
Company, Chartered Accountants to the effect that their appointment if
made, at the ensuing Annual General Meeting would be in accordance with
Sections 139 and 141 of the Companies Act 2013.
SECRETARIAL AUDIT REPORT
In accordance with Section 204 of the Companies Act, 2013 and Rule 9 of
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules 2014, Shri.G. Ramachandran of M/s. G. Ramachandran & Associates,
Company Secretaries was appointed by the Company to undertake
Secretarial Audit of the Company. The Secretarial Audit Report is
annexed to this report as Annexure-5.
Explanation on comments by the Board on Every qualification,
reservation on adverse remark or disclaimer mode by Auditor /
Secretariat Auditor.
Neither the statutory auditor nor the secretarial auditor have made any
qualification, reservation or adverse remark or disclaimer in their
respective reports.
DIRECTORS' RESPONSIBILITY STATEMENT
In pursuance of section 134 (3) (C) of the Companies Act, 2013, and
based on the information provided by the Management, your Directors
hereby confirm that:
a) in the preparation of the annual accounts, the applicable accounting
standards had been followed;
b) Accounting policies selected were applied consistently. Reasonable
and prudent judgments and estimates were made so as to give a true and
fair view of the state of affairs of the company as at 31 March 2015
and of the profit and loss of the company for that date;
c) Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act 2013 for safeguarding the assets of the company and for
preventing and detecting fraud and other irregularities;
d) The annual accounts of the Company have been prepared on a going
concern basis;
e) Internal financial controls have been followed by the company and
such internal financial controls are adequate and were operating
effectively.
f) Systems to ensure compliance with the provisions of all applicable
laws were in place and that such systems were adequate and operating
effectively.
INTERNAL CONTROL SYSTEMS
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. To maintain its objectivity and
independence, the Internal Audit function reports to the Chairman of
the Audit Committee of the Board.
The Internal Audit Department monitors and evaluates the efficacy and
adequacy of internal control system in the Company, its compliance with
operating systems, accounting procedures and policies at all locations
of the Company. Significant audit observations and corrective actions
thereon are presented to the Audit Committee of the Board every quarter
or at periodic intervals.
EXTRACTS OF THE ANNUAL RETURN (FORM MGT-9)
As required pursuant to section 92(3) of the Companies Act, 2013 and
rule 12(1) of the Companies (Management and Administration) Rules,
2014, an extract of annual return in form MGT 9 is annexed as a part of
this report (Annexure-4).
DETAILS OF LOANS GIVEN, GUARANTEES GIVEN OR SECURITY PROVIDED
The provisions contained in Section 186 of the Companies Act,2013,
relating to loans, guarantees or securities do not apply to the
Company.
INVESTMENTS
The Company has investments in the equity of unlisted associate
companies, Repco Micro Finance Limited and Repco Infrastructure
Development Company Limited to the extent of Rs.12.40 Crore
(1,24,00,000 equity shares of Rs.10/- each ) and Rs.0.05 crore (50,000
equity shares of Rs.10/- each) respectively.
PUBLIC DEPOSITS
The Company has not accepted deposits from the public during the
financial year 2014-15.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED
TO IN SECTION 188(1) OF THE COMPANIES ACT, 2013
The Company has not entered into Contracts or Arrangements with Related
parties referred to in Section 188(1) of the Comapnies Act, 2013 during
the year under review.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE
COMPANY BETWEEN 31ST MARCH 2015 AND THE DATE OF BOARD'S REPORT
There has been no material changes and commitment, affecting the
financial position of the Company which has occurred between the end of
the financial year to which the financial statements relate and the
date of the report.
The Company does not have any subsidiary. There has been no change in
the nature of business of the Company. No significant or material
orders have been passed by the regulators or Courts or Tribunals
impacting the going concern status of the Company and / or the
Company's operations in future.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review, as
stipulated by Clause 49 of the Listing Agreement with the stock
exchanges is presented in a separate section which forms a part of this
report.
REPORT ON CORPORATE GOVERNANCE
The report on corporate governance for the year under review, as
stipulated by Clause 49 of the Listing Agreement with the stock
exchanges is presented in a separate section which forms a part of this
report.
DISCLOSURES
The disclosures on Number of meetings of the Board, including dates of
Board and Committee meetings held indicating the number of meetings
attended by each Director, Declaration by Independent Directors, the
details of various Committees, their scope and constitution and
establishment of Whistle Blower Policy/Vigil Mechanism are furnished in
the Report on Corporate Governance.
ACKNOWLEDGEMENTS
The Directors of your Company wish to place on record their sincere
gratitude to the National Housing Bank and its Executives for
continuous guidance and support. We also record our gratitude to our
bankers, financial institutions and insurance companies for their
continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to Ministry of Home
Affairs, GOI, SEBI, NSE, BSE, Department of Company Affairs, REPCO
Bank, shareholders, Government, local/statutory authorities, customers
and all the other stakeholders for their patronage and support for the
achievements by the Company, despite the most competitive environment
in the market.
Your Directors take this opportunity to thank all the executives and
employees of the Company and wish to place on record their commendable
hard work, team spirit and dedicated service to the customers which
enabled the Company to achieve an appreciable level of business
performance during the year.
Place : Chennai For and on behalf of the Board of Directors
Date : 07.08.2015
(T.S.KrishnaMurthy)
Chairman
Mar 31, 2014
TO THE MEMBERS
The directors are pleased to present the fourteenth annual report of
your company with the audited accounts for the year ended March 31,
2014.
FINANCIAL RESULTS (Rsin Crore)
For the Year For the Year
March31,2014 March31,2013
Loans Sanctioned 1,822.52 1,284.83
Loans Disbursed 1,715.26 1,167.41
Loans Outstanding 4,661.86 3,544.75
Net NPA as a % of Net Advances 0.72 0.99
Total Income 535.34 405.86
Profit before tax 149.13 106.80
Less: Provision for tax 39.03 26.78
Profit after tax 110.10 80.02
Profit available for appropriation 174.94 131.99
Appropriation:
Transfer to Special Reserve (in accordance 34.39 23.14
with Section 36(i)(viii) of the
Income tax Act, 1961)
Transfer to Special Reserve (in accordance 22.03 16.01
Section 29C of National
Housing Bank Act, 1987)
Transfer to General Reserve 20.00 20.00
Proposed Dividend 7.46 6.84
Corporate Dividend Tax thereon 1.27 1.16
Balance carried forward 89.79 64.84
DIVIDEND
Your Directors recommend payment of dividend for the financial year
ended 31 March 2014 at the rate of Rs.1.20 per equity shares. The
dividend shall be paid subject to approval by the shareholders at the
Fourteenth Annual General Meeting. The total dividend outlay including
dividend distribution tax of Rs.1.27 crores, for the current year would
be Rs.8.73 crores as against Rs.8.00 crore including dividend
distribution tax, for the previous year.
LENDING OPERATIONS
During the year loan approvals stood at Rs. 1,822.52 crore as compared
to Rs. 1,284.83 crore in the previous year registering a growth of
41.85%. Loan disbursements during the year were Rs. 1,715.26 crore as
compared to Rs. 1,167.41 crore in the previous year representing a
growth of 46.93%.
LOAN BOOk
The loan book of the Company was Rs. 4,661.86 crores as against Rs.
3,544.75 crores in the previous year representing a growth of 31.51%.
NON PERFORMING ASSETS
As of 31 March 2014, the net non performing assets represent 0.72% of
the loan portfolio of the Company as against 0.99 % of the loan
portfolio of the Company last year.
RESOURCE MOBILIzATION
The Company takes every effort to tap the appropriate source of funding
to minimize the weighted average cost of funds. The resource base of
the company consists of refinance from National Housing Bank,
borrowings from Banks and Repco Bank Ltd.,
Total debts funds as on 31st March 2014 amounted to Rs.3,902.02 crore
as against Rs. 3,064.69 crore in previous year. Refinance from National
Housing Bank constituted 24.99%, borrowings from Banks and Repco Bank
Ltd, constituted 64.80% and 10.21% respectively.
REFINANCE FROM NHB
With the continued support of National Housing Bank (NHB), the company
has availed refinance amounting to Rs.100.00 crore during the year
under review and as on 31 March 2014, the outstanding NHB refinance
stood at Rs.975.23 crore as against Rs.1,120.00 crore as at end of the
previous year.
BORROWINGS FROM BANkS
The company has borrowed Rs.1673.00 crore from Banks during the year as
compared to Rs.868.00 crore during the previous year. The aggregate of
term loans, including working capital loan from Banks and Repco Bank
Ltd., outstanding at the end of the financial year was Rs. 2,926.79
crore as against Rs.1,944.69 crore as at the end of the previous year.
CREDIT RATING
The Company''s borrowings enjoy the following credit rating
Rating Agency ICRA Ltd. CARE Ltd.
Term Loans from Bank [ICRA]AA- [CARE]AA-
Non-Convertible [ICRA]AA- [CARE]AA-
Debentures
Commercial Paper [ICRA]A1 [CARE]A1
DIRECTORS
In accordance with the Articles of Association and Section 152 of the
Companies Act, 2013, Shri. S.C.Panda, I.A.S. Director, retires by
rotation at the ensuing Annual General Meeting and being eligible,
offers himself for re-appointment. Your Directors recommend his
re-appointment.
Shri. K.K. Pathak, I.A.S was co-opted as an Additional Director of the
Company with effect from October 25, 2013 pursuant to Section 260 of
the Companies Act 1956. Pursuant to Section 160 of the Act, the Company
has received a notice, together with requisite deposit of Rupees One
Lakh from a member signifying his intention to propose Shri.K.K.Pathak,
I.A.S. as Director of the Company, liable to retire by rotation and
accordingly a resolution is being placed before the members at the
ensuing Annual General Meeting.
Shri. T.S. KrishnaMurthy Shri. Thomas Paul Diamond, Shri. V.
Nadanasabapathy and Shri. G.R. Sundaravadivel are proposed to be
appointed as independent directors for a term of 5 consecutive years
from September 11, 2014 to September 10, 2019 as per provisions of
Section 149, 150 and 152 and other applicable provisions of the
Companies Act 2013.
AUDITORS
M/s. R.Subramanian and Company retire at the conclusion of the
forthcoming annual general meeting. The Board of Directors recommend
the appointment of M/s.R.Subramanian and Company for the financial year
2014-15.
CORPORATE GOVERNANCE
The Company has obtained a certificate from the statutory auditor
regarding compliance with Clause 49 of the Listing Agreement with the
stock exchanges and it is attached to the Corporate Governance Report.
The Company is in compliance with the principles of good governance
founded on integrity and transparency.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review, as
stipulated by Clause 49 of the Listing Agreement with the stock
exchanges is presented in a separate section forming part of the annual
report.
REGULATORY COMPLIANCE
The Company is in compliance with the guidelines, circulars and
directions of National Housing Bank. The Company''s capital adequacy
ratio as on 31 March 2014 was 24.51% which is well above the prescribed
12% threshold as per NHB Directions. The Company is also in compliance
with the guidelines, directions and circulars of SEBI.
PUBLIC DEPOSITS
The Company is registered with National Housing Bank with eligibility
to raise public deposits , however till date, the Company has not
commenced acceptance of deposits from the public.
UNCLAIMED DIVIDENDS
As at March 31, 2014, dividend amounting to Rs.6,452 has not been
claimed by shareholders.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
Since the Company is not into any manufacturing activity particulars
relating to conservation of Energy and technology absorption are not
furnished.
FOREIGN ExCHANGE EARNINGS AND ExPENDITURE
The particulars of foreign exchange earnings and expenditure for the
financial year ended March 31, 2014:
Expenditure incurred in foreign currency for the financial year ended
March 31, 2014 is Rs.420,949 (previous year: Rs.7,18,575)
There are no earnings in foreign currency during the current year as
well as in the previous year.
Particulars of employees covered under Section 217(2A) read with
Companies (Particulars of Employees) Rules, 1975
There are no employees covered under Section 217(2A) read with
Companies (Particulars of Employees) Rules, 1975 as amended.
AUDITORS'' OBSERvATION
There is no adverse remark or observation by the statutory auditor.
OUTLOOk FOR 2014
The Company ''s listing enables it to access cost effective sources of
funds. The Company believes that with diversified shareholding pattern
its rating would improve which will pave way for the Company to raise
its resources from diversified sources. Overall Company''s prospects
appear to be bright given its efficacious treasury management and
robust credit appraisal systems. A diversified branch presence across
the country in the forthcoming financial year would help in sustaining
the growth rate achieved since inception.
HUMAN RESOURCE DEVELOPMENT
The objective of human resource development in an organization is to
enhance human productivity through progressive and consistent policies
in knowledge & skill upgradation and betterment of employment
conditions at all levels. Human resource management''s objective is to
maximize the return on investment from the organization''s human
capital. It is the responsibility of human resource development
departments in a corporate context to conduct these activities in an
effective, legal, impartial and cohesive manner.
Your Company worked tirelessly towards the skill up gradation of its
employees by introducing objective performance appraisal mechanism and
performance linked incentive structure and up to date technology
infrastructure. Employees are nominated regularly to attend various
training programmes conducted by NHB, RBI & other capacity building
institutions besides organizing in-house training programmes.
The Company provides a professional work environment and maintains a
healthy relation with its employees.
As on 31 March 2014, the number of people employed by the company stood
at 465.
BUSINESS OPERATIONS NETWORk
The Company is currently having 91 branches and 31 SAT centres across
Tamil Nadu, Andhra Pradesh, Karnataka, Kerala, Puducherry Orissa,
Gujarat Maharashtra, West Bengal and Madhya Pradesh.
DIRECTORS'' RESPONSIBILITy STATEMENT
Pursuance to Section 217(2AA) of the Companies Act, 1956, your
Directors confirm that:
- in the preparation of the Annual accounts, the applicable accounting
standards have been followed together with proper explanation relating
to material departure, if any;
- the accounting policies have been selected and applied consistently
and the judgments and estimates made are reasonable and prudent so as
to give a fair view of the state of affairs of the Company at the end
of the financial year and the profit of the Company for that period;
- proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company for
preventing and detecting fraud and other irregularities;
- the annual accounts have been prepared on a going concern basis.
EMPLOyEE STOCk OPTION SCHEME
Details of stock options granted during the financial year 2013-14 are
as under:
Scheme Repco Home Finance Employee
Stock Option Scheme 2013
No of Options 2,44,375
granted
Date of grant 25 October 2013
The Company has received the in-principle approval from BSE Limited and
National Stock Exchange of India Limited, for listing the shares
arising out of the exercise of the options.
As required under SEBI (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 a disclosure is annexed herewith.
ACkNOWLEDGEMENTS
The Directors of your Company wish to place on record their sincere
gratitude to the National Housing Bank and its Executives for their
patronage and whole-hearted support. We also record our gratitude to
our bankers, financial institutions and insurance companies for their
continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to Ministry of Home
Affairs, GOI, SEBI, NSE, BSE, Department of Company Affairs, REPCO
Bank, shareholders, Government, local/statutory authorities, customers
and all others for their patronage and support for the achievements by
the Company despite the most competitive environment in the market.
Your Directors take this opportunity to thank all the executives and
employees of the Company and wish to place on record their commendable
hard work, team spirit and dedicated service to the customers which
enabled the Company to achieve an appreciable level of business
performance during the year.
For and on behalf of the Board of Directors
Place : Chennai (T.S.KrishnaMurthy)
Date : 13 May 2014 Chairman
Mar 31, 2013
TO THE MEMBERS
The directors are pleased to present the thirteenth annual report of
your company with the audited accounts for the year ended March 31,
2013.
FINANCIAL RESULTS
(Rs. in Crore)
For the
Year ended For the
Year ended
March 31,
2013 March 31,
2012
Loans Sanctioned 1,284.83 1111.56
Loans Disbursed 1,167.41 1,042.34
Loans Outstanding 3,544.75 2,804.08
Net NPA as a % of Net Advances 0.99 0.95
Total Income 405.97 318.89
Profit before tax 106.80 81.63
Less: Provision for tax 26.78 20.17
Profit after tax 80.02 61.46
Profit available for appropriation 131.99 97.62
Appropriation:
Transfer to Special Reserve (in accordance with 23.14 19.71
Section 36(i)(viii) of the Income tax Act, 1961)
Transfer to Special Reserve (in accordance with 16.01 -
Section 29C of National Housing Bank Act, 1987)
Transfer to General Reserve 20.00 20.00
Proposed Dividend 6.84 5.11
Corporate Dividend Tax thereon 1.16 0.83
Balance carried forward 64.84 51.97
DIVIDEND
Your Directors recommend payment of dividend for the financial year
ended 31 March 2013 at the rate of 11% on equity shares. The dividend
shall be paid subject to approval by the shareholders at the Thirteenth
annual general meeting. The total dividend outlay including dividend
distribution tax of Rs.1.16 crores, for the current year would be Rs.8
crores as against Rs.5.94 crore including dividend distribution tax,
for the previous year.
LENDING OPERATIONS
During the year loan approvals stood at Rs.1,284.83 crore as compared
to Rs.1,111.56 crore in the previous year registering a growth of
15.59%. Loan disbursements during the year were Rs.1,167.41 crore as
compared to Rs. 1,042.34 crore in the previous year representing a
growth of 12%.
LOAN BOOK
The loan book of the Company was Rs.3544.75 crores as against Rs.
2804.08 crores in the previous year representing a growth of 26.41%.
NON PERFORMING ASSETS
As of 31 March 2013, the net non performing assets represents 0.99% of
the loan portfolio of the Company as against 0.95 % of the loan
portfolio of the Company last year.
FUNDS RAISING
The Company raised Rs.270 Crore during the year by public issue of
15,720,262 equity shares of Rs.10 each at price of Rs.172 per share
(premium of Rs.162 per share). The shares got listed both in National
Stock Exchange and Bombay Stock Exchange on April 1, 2013.
Your Company persisted in its effort in building a diversified resource
base with lowest cost possible for preferred tenures. The resource base
of your Company consists of NHB refinance, term loans from banks and
financial assistance from Repco Bank. The Company''s borrowings have
been rated "ICRA A ".
DIRECTORS
In accordance with Articles of the Association and Section 256 of the
Companies Act, 1956, Shri. T.S.KrishnaMurthy and Shri V
Nadanasabapathy, Directors, retire by rotation at the ensuing Annual
General Meeting and being eligible, offers themself for re-appointment.
Your Directors recommend their re-appointment.
AUDITORS
M/s. R.Subramanian and Company retire at the conclusion of the
forthcoming annual general meeting. The Company has received the
requisite certificate from them stating that their appointment if made
will be within the limits as specified under Section 224(1B) of the
Companies Act, 1956.
The Board of Directors recommend the appointment of M/s. R.Subramanian
and Company for the financial year 2013-14.
CORPORATE GOVERNANCE
The Company has obtained a certificate from the statutory auditor
regarding the compliance with Clause 49 of the Listing Agreement with
the stock exchanges and it is attached to the Corporate Governance
Report. The Company is in compliance with the principles of good
governance founded on integrity and transparency.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review, as
stipulated by Clause 49 of the Listing Agreement with the stock
exchanges is presented in a separate section forming part of the annual
report.
REGULATORY COMPLIANCE
The Company is in compliance with the guidelines, circulars and
directions of National Housing Bank. The Company''s capital adequacy
ratio as on 31 March 2013 was 25.5% which is well above the prescribed
12% threshold as per NHB Directions. The Company is also in compliance
with the guidelines, directions and circulars of SEBI.
PUBLIC DEPOSITS
The Company is registered with National Housing Bank with eligibility
to raise public deposits, however till date the Company has not
commenced acceptance of deposits from the public.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
Since the Company is not into any manufacturing activity particulars
relating to conservation of Energy and technology absorption are not
furnished.
FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
The particulars of foreign exchange earnings and expenditure for the
financial year ended March 31, 2013:
Expenditure incurred in foreign currency for the financial year ended
March 31,2013 is Rs. 7,18,575 (previous year: NIL)
There are no earnings in foreign currency during the current year as
well as in the previous year.
Particulars of employees covered under Section 217(2A) read with
Companies (Particulars of Employees) Rules, 1975
There are no employees covered under Section 217(2A) read with
Companies (Particulars of Employees) Rules, 1975 as amended.
AUDITORS'' OBSERVATION
There is no adverse remark or observation by the statutory auditor.
OUTLOOK FOR 2014
The Company ''s listing enables it to access cost effective sources of
funds. The Company believes that with diversified shareholding pattern
its rating would improve which will pave way for the Company to raise
its resources from diversified sources. Overall Company''s prospects
appear to be bright given its efficacious treasury management and
robust credit appraisal systems. A diversified branch presence across
the country in the forthcoming financial year would help in sustaining
the growth rate achieved since inception.
HUMAN RESOURCE DEVELOPMENT
The objective of human resource development in an organization is to
enhance human productivity through progressive and consistent policies
in knowledge & skill upgradation and betterment of employment
conditions at all levels. Human resource management''s objective is to
maximize the return on investment from the organization''s human
capital. It is the responsibility of human resource departments in a
corporate context to conduct these activities in an effective, legal,
impartial and cohesive manner.
Your Company worked tirelessly towards the skill up gradation of its
employees by introducing objective performance appraisal mechanism and
performance linked incentive structure and up to date technology
infrastructure. Employees are nominated regularly to attend various
training programmes conducted by NHB, RBI & other capacity development
institutions besides organizing in-house training programmes. During
the year 2012-13, 6 programmes were conducted by the Company in which
190 staffs participated. Besides 18 staffs were sent for programme
conducted by others.
The Company provides a professional work environment and maintains a
healthy relation with its employees. As on 31 March 2013, the number of
people employed by the company stood at 382.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuance to Section 217(2AA) of the Companies Act, 1956, your
Directors confirm that:
in the preparation of the Annual accounts, the applicable accounting
standards have been followed together with proper explanation relating
to material departure, if any;
the accounting policies have been selected and applied consistently and
the judgments and estimates made are reasonable and prudent so as to
give a fair view of the state of affairs of the Company at the end of
the financial year and the profit of the Company for that period;
proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company for
preventing and detecting fraud and other irregularities;
the annual accounts have been prepared on a going concern basis.
ACKNOWLEDGEMENTS
The Directors of your Company wish to place on record their sincere
gratitude to the National Housing Bank and its Executives for their
patronage and whole-hearted support. We also record our gratitude to
our bankers, financial institutions and insurance companies for their
continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to Ministry of Home
Affairs, GOI, SEBI, NSE, BSE,
Department of Company Affairs, REPCO Bank, shareholders, BRLMs,
Government, local/statutory authorities, customers and all others for
their patronage and support for the achievements by the Company despite
the most competitive environment in the market.
Your Directors take this opportunity to thank all the executives and
employees of the Company and wish to place on record their commendable
hard work, team spirit and dedicated service to the customers which
enabled the Company to achieve an appreciable level of business
performance during the year.
For and on behalf of the Board of Directors
Place : Chennai (T.S.KrishnaMurthy)
Date : 10 May 2013 Chairman
Mar 31, 2012
TO THE MEMBERS
The directors are pleased to present the thirteenth annual report of
your company with the audited accounts for the year ended March 31,
2013.
FINANCIAL RESULTS
(Rs. in Crore)
For the Year ended For the Year ended
March 31, 2013 March 31, 2012
Loans Sanctioned 1,284.83 1111.56
Loans Disbursed 1,167.41 1,042.34
Loans Outstanding 3,544.75 2,804.08
Net NPA as a % of Net Advances 0.99 0.95
Total Income 405.97 318.89
Profit before tax 106.80 81.63
Less: Provision for tax 26.78 20.17
Profit after tax 80.02 61.46
Profit available for appropriation 131.99 97.62
Appropriation:
Transfer to Special Reserve
(in accordance with 23.14 19.71
Section 36(i)(viii) of the Income
tax Act, 1961)
Transfer to Special Reserve
(in accordance with 16.01 -
Section 29C of National Housing
Bank Act, 1987)
Transfer to General Reserve 20.00 20.00
Proposed Dividend 6.84 5.11
Corporate Dividend Tax thereon 1.16 0.83
Balance carried forward 64.84 51.97
DIVIDEND
Your Directors recommend payment of dividend for the financial year
ended 31 March 2013 at the rate of 11% on equity shares. The dividend
shall be paid subject to approval by the shareholders at the Thirteenth
annual general meeting. The total dividend outlay including dividend
distribution tax of Rs.1.16 crores, for the current year would be Rs.8
crores as against Rs.5.94 crore including dividend distribution tax,
for the previous year.
LENDING OPERATIONS
During the year loan approvals stood at Rs.1,284.83 crore as compared
to Rs.1,111.56 crore in the previous year registering a growth of
15.59%. Loan disbursements during the year were Rs.1,167.41 crore as
compared to Rs. 1,042.34 crore in the previous year representing a
growth of 12%.
LOAN BOOK
The loan book of the Company was Rs.3544.75 crores as against Rs.
2804.08 crores in the previous year representing a growth of 26.41%.
NON PERFORMING ASSETS
As of 31 March 2013, the net non performing assets represents 0.99% of
the loan portfolio of the Company as against 0.95 % of the loan
portfolio of the Company last year.
FUNDS RAISING
The Company raised Rs.270 Crore during the year by public issue of
15,720,262 equity shares of Rs.10 each at price of Rs.172 per share
(premium of Rs.162 per share). The shares got listed both in National
Stock Exchange and Bombay Stock Exchange on April 1, 2013.
Your Company persisted in its effort in building a diversified resource
base with lowest cost possible for preferred tenures. The resource base
of your Company consists of NHB refinance, term loans from banks and
financial assistance from Repco Bank. The Company''s borrowings have
been rated "ICRA A ".
DIRECTORS
In accordance with Articles of the Association and Section 256 of the
Companies Act, 1956, Shri. T.S.KrishnaMurthy and Shri V
Nadanasabapathy, Directors, retire by rotation at the ensuing Annual
General Meeting and being eligible, offers themself for re-appointment.
Your Directors recommend their re-appointment.
AUDITORS
M/s. R.Subramanian and Company retire at the conclusion of the
forthcoming annual general meeting. The Company has received the
requisite certificate from them stating that their appointment if made
will be within the limits as specified under Section 224(1B) of the
Companies Act, 1956.
The Board of Directors recommend the appointment of M/s. R.Subramanian
and Company for the financial year 2013-14.
CORPORATE GOVERNANCE
The Company has obtained a certificate from the statutory auditor
regarding the compliance with Clause 49 of the Listing Agreement with
the stock exchanges and it is attached to the Corporate Governance
Report. The Company is in compliance with the principles of good
governance founded on integrity and transparency.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review, as
stipulated by Clause 49 of the Listing Agreement with the stock
exchanges is presented in a separate section forming part of the annual
report.
REGULATORY COMPLIANCE
The Company is in compliance with the guidelines, circulars and
directions of National Housing Bank. The Company''s capital adequacy
ratio as on 31 March 2013 was 25.5% which is well above the prescribed
12% threshold as per NHB Directions. The Company is also in compliance
with the guidelines, directions and circulars of SEBI.
PUBLIC DEPOSITS
The Company is registered with National Housing Bank with eligibility
to raise public deposits, however till date the Company has not
commenced acceptance of deposits from the public.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
Since the Company is not into any manufacturing activity particulars
relating to conservation of Energy and technology absorption are not
furnished.
FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
The particulars of foreign exchange earnings and expenditure for the
financial year ended March 31, 2013:
Expenditure incurred in foreign currency for the financial year ended
March 31,2013 is Rs. 7,18,575 (previous year: NIL)
There are no earnings in foreign currency during the current year as
well as in the previous year.
Particulars of employees covered under Section 217(2A) read with
Companies (Particulars of Employees) Rules, 1975
There are no employees covered under Section 217(2A) read with
Companies (Particulars of Employees) Rules, 1975 as amended.
AUDITORS'' OBSERvATION
There is no adverse remark or observation by the statutory auditor.
OUTLOOK FOR 2014
The Company ''s listing enables it to access cost effective sources of
funds. The Company believes that with diversified shareholding pattern
its rating would improve which will pave way for the Company to raise
its resources from diversified sources. Overall Company''s prospects
appear to be bright given its efficacious treasury management and
robust credit appraisal systems. A diversified branch presence across
the country in the forthcoming financial year would help in sustaining
the growth rate achieved since inception.
HUMAN RESOURCE DEVELOPMENT
The objective of human resource development in an organization is to
enhance human productivity through progressive and consistent policies
in knowledge & skill upgradation and betterment of employment
conditions at all levels. Human resource management''s objective is to
maximize the return on investment from the organization''s human
capital. It is the responsibility of human resource departments in a
corporate context to conduct these activities in an effective, legal,
impartial and cohesive manner.
Your Company worked tirelessly towards the skill up gradation of its
employees by introducing objective performance appraisal mechanism and
performance linked incentive structure and up to date technology
infrastructure. Employees are nominated regularly to attend various
training programmes conducted by NHB, RBI & other capacity development
institutions besides organizing in-house training programmes. During
the year 2012-13, 6 programmes were conducted by the Company in which
190 staffs participated. Besides 18 staffs were sent for programme
conducted by others.
The Company provides a professional work environment and maintains a
healthy relation with its employees. As on 31 March 2013, the number of
people employed by the company stood at 382.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuance to Section 217(2AA) of the Companies Act, 1956, your
Directors confirm that:
In the preparation of the Annual accounts, the applicable accounting
standards have been followed together with proper explanation relating
to material departure, if any;
the accounting policies have been selected and applied consistently and
the judgments and estimates made are reasonable and prudent so as to
give a fair view of the state of affairs of the Company at the end of
the financial year and the profit of the Company for that period;
Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company for
preventing and detecting fraud and other irregularities;
The annual accounts have been prepared on a going concern basis.
ACKNOWLEDGEMENTS
The Directors of your Company wish to place on record their sincere
gratitude to the National Housing Bank and its Executives for their
patronage and whole-hearted support. We also record our gratitude to
our bankers, financial institutions and insurance companies for their
continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to Ministry of Home
Affairs, GOI, SEBI, NSE, BSE,
Department of Company Affairs, REPCO Bank, shareholders, BRLMs,
Government, local/statutory authorities, customers and all others for
their patronage and support for the achievements by the Company despite
the most competitive environment in the market.
Your Directors take this opportunity to thank all the executives and
employees of the Company and wish to place on record their commendable
hard work, team spirit and dedicated service to the customers which
enabled the Company to achieve an appreciable level of business
performance during the year.
For and on behalf of the Board of Directors
Place : Chennai (T.S.KrishnaMurthy)
Date : 10 May 2013 Chairman
Mar 31, 2011
TO THE MEMBERS
The Directors take pride and pleasure in presenting the 11th Annual
Report of your Company with the Audited Accounts for the year ended
March 31, 2011.
FINANCIAL RESULTS
(Rs. in lakh)
For the
Year ended For the
Year ended
March 31,
2011 March 31,
2010
Loans Sanctioned 99,813 64,905
Loans Disbursed 91,559 58,308
Loans Outstanding 207,349 140,801
No. of Loan Accounts 29,948 23,244
Business per employee 1039 838
Net NPA as a % of Net Advances 0.82 0.86
Income from Operation 22,595.00 16428.6
Profit before tax 7,925.03 6,114.78
Less: Provision for tax 2,109.74 1,680.45
Profit after tax 5,815.29 4,434.33
Balance brought forward from previous year 1,989.18 1,365.85
Profit available for appropriation 7,804.48 5,800.18
Appropriation:
Transfer to Special Reserve 1,648.95 1267.64
Transfer to General Reserve 2,000.00 2000
Proposed Dividend 464.42 464.42
Corporate Dividend Tax thereon 75.34 78.93
Balance carried forward 3,615.77 1911.18
PERFORMANCE HIGHLIGHTS
Lending Operations
During the year the Company sanctioned loans of Rs.991,83 Crore as
against Rs.649.05 Crore last year showing an increase of 54%. The
disbursements during the year were Rs.915.59 Crore as against Rs.583.08
Crore showing an increase of 57%.
The outstanding at the end of the year was Rs.2073.49 crore as against
Rs.1408.01 crore as on March 31, 2010, a growth rate of 47%. The
Company ''s excellent growth has been on the solid foundation of credit
guality which is evidenced by the GNPA figure of 1.21% and NNPA figure
of 0.82% as on 31-3-2011.
Interest rates
This financial year was characterized by tightening interest rate
scenario which saw rates spiral. This in turn impacted the net interest
margins of the players in the industry.
However the Company did not effect any upward revision till the
beginning of March 2011 when the interest rates were revised upward to
10.25% from 10.00% for loans upto Rs. 20 lakhs and to 10.75% from
10.00% for loans above Rs. 20 Lakhs.
The Company offered a concession of 0.25% to prospective salaried class
customers /concession of 0.50% for rural housing subject to the rate of
interest being a minimum of 10%.
Profitability
Your Company achieved a proiit before tax (PBT) of Rs.7925.04 lakhs as
against the corresponding figure of Rs.6114.78 lakhs in the previous
year, registering a growth of more than 29%. Profit after tax (PAT)
also increased by 31% to reach the figure of Rs.5815.29 lakhs from Rs.
4434.32 lakh last year.
Dividend
Your Directors recommend payment of dividend for the year ended March
31, 2011 at the rate of 10% on equity shares. The dividend shall be
paid subject to approval by the shareholders at the Eleventh annual
general meeting to be held on 25 May, 2011 to such shareholders whose
name appear in the register of members as on the said date.
Resource Mobilization
Your Company persisted in its effort in building a diversified resource
base with lowest cost possible for preferred tenures. The resource base
of your Company consists of NHB refinance, term loans from banks and
financial assistance from Repco Bank.
Refinance from NHB
During the year, your Company has received sanction for Rs. 25000 lakh
and availed fresh refinance assistance amounting to Rs. 9454 lakh from
the National Housing Bank (NHB). As on 31 March 2011 the outstanding
NHB refinance in our books stands at Rs. 89149 lakh.
Term Loan from Banks
During the year under review, term loans amounting to Rs. 55471 lakh
were availed from the Banks and Financial Institutions, taking the
total term loan outstanding to Rs. 93575 lakh.
Compliance with NHB Guidelines
Your Company has been scrupulously conforming to all the guidelines and
directions issued by NHB on asset classification, accounting standards,
income recognition, provisioning, capital adequacy, credit
concentration / investments, credit rating etc., as issued from time to
time.
Capital Adequacy
The Capital Adequacy Ratio of the Company as on 31 March 2011 was
18.21% against the minimum stipulated requirement of 12.00%.
CORPORATE GOVERNANCE
In business parlance Corporate Governance is defined as an internal
system encompassing policies, processes and people, which caters to the
need of all stakeholders of the Company by directing and controlling
management activities with objectivity, accountability and integrity.
Sound corporate governance indicates a healthy board culture which
safeguards policies and processes in the backdrop of external
marketplace commitment and legislation.
The ethical formation of Repco Group of Companies ensure a culture for
promoting good governance and voluntary compliance facilitating
effective participation of different stakeholders while creating a
framework of best practices, structure and processes clearly defining
the rights and responsibilities of different role players for making
independent and informed decisions on corporate affairs.
BOARD OF DIRECTORS
The management of affairs and business of the Company is vested in the
Board of Directors comprising a non-executive Chairman, a Managing
Director, Executive Director and 9 Directors who are Non Executive
Directors. The Chairman and Directors of the Company are professionals
and persons of eminence having vast and varied experience.
Pursuant to the provisions of Section 255, 256 and all other applicable
provisions of the Companies Act, 1956, two third of the Directors are
in the category of Directors required to retire by rotation and one
third of those Directors would retire every year and if eligible, they
could seek reappointment at the Annual General Meetings.
Meetings of the Board are being held at regular intervals and at least
once in a quarter. During the year 2010-11, the Board of Directors met
4 times. The Board discharges the duties and responsibilities
diligently as required under the various applicable statute(s)
including the Companies Act, 1956, Directions/ Guidelines issued by
National Housing Bank and other regulatory authorities from time to
time.
COMMITTEE OF THE BOARD
Boards of Directors have constituted Audit Committee, Management
Committee and Compensation Committee with appropriate delegations for
speedy decision-making and periodical review of business performance.
These Committees, depending upon the requirements and delegations, take
decisions/prepare the groundwork for decision-making and report at the
subsequent meetings of the Board.
AUDIT COMMITTEE
During the year 2010-11, the Audit Committee met twice. The Committee
in its meetings analyzed financial parameters and progress of the
Company and gave directions for improvement.
MANAGEMENT COMMITTEE
Management Committee met one time in the year 2010-11.
HUMAN RESOURCE DEVELOPMENT
The objective of human resource development in an organization is to
enhance human productivity through progressive and consistent policies
in knowledge & skill upgradation and betterment of employment
conditions at all levels. Human resource management''s objective is to
maximize the return on investment from the organization''s human
capital. It is the responsibility of human resource departments in a
corporate context to conduct these activities in an effective, legal,
impartial and cohesive manner.
Your Company worked tirelessly towards the skill up gradation of its
employees by introducing objective performance appraisal mechanism and
performance linked incentive structure and up to date technology
infrastructures. Employees are nominated regularly to attend various
training programmes conducted by NHB, RBI & other capacity development
institutions besides organizing in-house training programmes.
The Company provides a professional work environment and maintains a
healthy relation with its employees. As on 31 March 2011, the number of
people employed by the company stood at 232.
SOFTWARE DEVELOPMENT
RHFL has a web based centralized software solution known as Loan
Origination System (LOS)/ Core Banking Solutions (CBS) in place to
facilitate online sanction of loans.
PUBLIC DEPOSITS
Your Company has not accepted public deposits during the period under
review. Hence the particulars as required under Section 10(l)(a)(b) of
Housing Finance Companies (NHB) Directions, 2001 are not furnished.
PARTICULARS OF EMPLOYEES
There are no employees covered by Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules 1975 as
amended.
Particulars Regarding Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings & Expenditure
Since the Companyis not carrying onany manufacturing activity,
particulars required relating to Conservation of Energy and Technology
absorption are not furnished. There are no transactions involving
foreign exchange earnings or outgo during the year under review.
DIRECTORS
Your Directors place on record their appreciation of the valuable
guidance, service and assistance rendered by Shri D.Jothi Jagarajan
Shri C.K.Viswanathan , Shri M.Baiasubramanian and Shri.A.K.Goya) who
ceased to be Directors of the Company. D r. S, Karutiah Panadian and
Smt. K.B. Valasala Kumari were appointed as Additional Directors on 24
September 2010 .
Shri. R. Varadarajan has taken over as the Managing Director of the
Company with effect from 1 October 2010.
In accordance with Articles of the Article of Association and Section
256 of the Companies Act, 1956, Dr. Vishwapati Trivedi, Shri Thomas
Paul Diamond, Shri V Nadanasabapathy and Shri C.Thangaraju Directors,
retire by rotation at the ensuing Annual General Meeting and being
eligible, offers themself for re-appointment. Your Directors recommend
their re-appointment.
AUDITORS
M/s. R. Subramanian And Co. Chartered Accountants retire as Auditors of
the Company at the conclusion of the forthcoming Annual General Meeting
and being eligible have offered themselves for re-appointment.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuance to Section 217(2AA) of the Companies Act, 1956, your
Directors confirm that:
a) in the preparation of the Annual accounts, the applicable accounting
standards have been followed together with proper explanation relating
to material departure, if any;
b) the accounting policies have been selected and applied consistently
and the judgments and estimates made are reasonable and prudent so as
to give a fair view of the state of affairs of the Company at the end
of the financial year and the profit of the Company for that period;
c) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company for
preventing and detecting fraud and other irregularities;
d) the annual accounts have been prepared on a going concern basis.
PARTICULARS RELATING TO LISTING OF SECURITIES
The shares of the Company are not listed on any stock exchange.
RISK MANAGEMENT
In compliance with the regulatory requirements as stipulated by the
National Housing Bank, the Company has put in place an effective Asset
Liability Management Policy.
The Board of Directors of the Company has constituted a high power
committee to oversee ALM functions. The Committee reviews and monitors
liquidity position and interest rate gap periodically.
INVESTMENTS
The aggregate investment of the Company as on 31 March 2011 is Rs. 5
lakh in Repco Infrastructure Development Company Limited and Rs. 200
lakh in equity shares of Repco MSME Limited which is in compliance with
NHB guidelines and investment policy of the company.
INTERNAL CONTROL SYSTEMS
The Board of Directors of the Company has already placed
well-articulated internal control measures commensurate with the size
of the organization and intricacies of the business risk. The system of
regular inspection by Inspection Department and Internal Audit by
Chartered Accountants firm of selected branches form part of the
internal control system. The audit committee regularly reviews the
significant observations of internal audit and inspection of the
branches. The audit committee observations and recommendations are
being placed before the Board and implemented.
BUSINESS OPERATIONS NETWORK
The Company is currently having 52 branches and 17 centres across Tamil
Nadu, Andhra Pradesh, Karnataka, Kerala, Puducherry and Maharashtra.
The Company is exploring opportunities for new market expansion in the
states of Tamilnadu, Andhra Pradesh ,Kerala, Gujarat, Maharashtra, West
Bengal, Jharkand,Madhya Pradesh and Orissa to open 25 new branches in
FY 2011 -2012.
OUTLOOK
The Company''s prospects appear to be bright given its efficacious
treasury management and robust credit appraisal systems.
Adiversifiedbranchpresenceacross the country in the forthcoming
financial year would help in sustaining the staggering growth rate
record achieved since inception. The variegated sources of funds
procured at a cost effective rate complemented by an increasing trend
in credit off take augurs well for the Company which is poised to
achieve impeccable growth in its profitability in the future.
ACKNOWLEDGEMENTS
The Directors of your Company wish to place on record their sincere
gratitude to the National Housing Bank and its Executives for their
patronage and whole- hearted support. We also record our gratitude to
our bankers, financial institutions and insurance companies for their
continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to REPCO Bank and the
Carlyle Group-the shareholders. Government, local/statutory
authorities,customers and all others for their patronage and support
for the achievements by the Company despite the most competitive
environment in the market.
Your Directors take this opportunity to thank all the executives and
employees of the Company and wish to place on record their commendable
hard work, team spirited efforts and dedicated service to the customers
which enabled the Company to achieve an appreciable level of business
performance during the year.
For and on behalf of the
Board of Directors
Place : Chennai (Dr. S. Karuthiah Pandian)
Date : 29 April 2011 Chairman
Mar 31, 2010
The Directors take pride and pleasure in presenting the 10th Annual
Report of your Company with the Audited Accounts for the year ended
March 31. 2010
Financial Results
For the Year
ended For the Year
ended
March 31. 2010 March 31, 2009
(Rs. in Lakh) (Rs. in Lakh)
Loans Sanctioned 64.905 47,295
Loans Disbursed 58,308 42,837
Loans Outstanding 140,801 99,059
No. of Loan Accounts 23.244 18,676
Business per employee 838.00 846.66
Net NPA as a % of Net Advances 0.86 0.70
Income from Operation 16,428.60 11,482.43
Profit before tax 6,114.78 3,719.67
Less: Provision for tax 1,680.45 1,019.17
Profit after tax 4,434.33 2,700.50
Balance brought forward from
previous year 1,365.85 132.53
Profit available for appropriation 5,800.18 2,833.04
Appropriation:
Transfer to Special Reserve 1,267.64 770.57
Transfer to General Reserve 2,000.00 100.00
Proposed Dividend 464.42 509.95
Corporate Dividend Tax thereon 78.93 86.67
Balance carried forward 1,911.18 1,365.85
Performance Highlights
Lending Operations
During the year 2009-10, your Company accorded sanction to 6.693 loan
proposals amounting to Rs. 64.905 lakh thereby taking the cumulative
sanction to Rs. 203,004 lakh as on 31 March 2010, an incremental growth
of more than 37'' as compared to previous year''s sanction figure of Rs
47.295 lakh The disbursement during the year was Rs.58 308 lakh towards
6 387 loan accounts while the cumulative disbursement stood at Rs
185,928 lakh as on 31 March 2010 registering more than 36% growth over
the previous year''s disbursal figure of Rs.42837 lakh. The
outstanding at the end of the year was Rs 140.801 lakh as against
Rs.99,059 lakh as on March 31. 2009. a growth rate of more than 42%.
The
Company''s excellent growth has been on the solid foundation of credit
quality which is evidenced by the GNPA figure of 1.24% and NNPA figure
of 0.86% as on March 31, 2010
Interest rates
This financial year was characterized by a reduction in interest rates
by players In the market to stimulate credit off take. Teaser loan
offerings were introduced by banks /blousing finance companies which
were even as low at 8%. However these offerings are expected to be
weaned away by the banks/housing finance companies The presence of
sufficient liquidity in the system is resulting in high competition
The Company effected reduction in the prime lending rate by 50 bps for
all existing and prospective loans from 10 50% to 10% for loans up to
Rs.20 lakh and from 11% to 10 50% for loans above Rs 20 lakh This
reduction was complemented by a modification in the credit song
mechanism
The Company also offered further concession of 0.5% to prospective
salaried class customers.
Profitability
Your Company achieved a profit before tax (PBT) of Rs.6.114.78 lakhs as
against the corresponding figure of Rs. 3.719 67lakhs in the previous
year, registering a growth of more than 64% Profit after tax (PAT) also
increased by more than 64% to reach the figure of Rs. 4.434 33lakhs
from Rs. 2,700 50 lakh last year.
Dividend
Your Directors recommend payment of dividend for the year ended March
31. 2010 .The dividend shall be paid subject to approval by the
shareholders at the tenth annual general meeting to be held on 25 May,
2010 to such shareholders whose name appear in the register of members
as on the said date
Resource Mobilization
Your Company persisted in its effort in building a diversified resource
base with lowest cost possible for preferred tenures. The resource
base of your Company consists of NHB refinance ten loans from banks and
financial assistance from Repco Bank.
Refinance from NHB
During the year, your Company has received sanction for Rs 40,000 lakh
and availed fresh refinance assistance amounting to Rs 29 300 lakh from
the National Housing Bank (NHB) As on March 31 2010 the outstanding NHB
refinance in our books stands at Rs 70.972 lakh.
Term Loan from Banks
During the year under review loan of Rs. 999 lakh were availed from the
Banks and (financial Institutions, taking the total term loan
outstanding to Rs.54.797 60 lakh Theses loans were drawn at varying
spread below Ihe prime lending rates of the respective banks.
Compliance with NHB Guidelines
Your Company has been scrupulously conforming to all the guidelines and
directions issued by NHB on asset classification. accounting standards,
income recognition, provisioning capital adequacy, credit concentration
/ investments, credit rating etc., as issued from time to time
Capital Adequacy
The Capital Adequacy Ratio of the Company as on 31 March 2010 was
21.13% against the minimum stipulated require- ment of 12.00%.
Corporate Governance
In business parlance Corporate Governance is defined as an internal
system encompassing policies, processes and people which caters to the
need of all stakeholders of the Company by directing and controlling
management activities with objectivity. accountability and integrity.
Sound corporate governance indicates a healthy board culture which
safe- guards policies and processes in the backdrop of external
marketplace commitment and legislation.
The ethical formation of Repco Group of Companies ensure a culture for
promoting good governance and voluntary compliance facilitating
effective participation of different stakeholders while creating a
framework of best practices, structure and processes clearly defining
the rights and responsibilities of different role players for making
independent and informed decisions on corporate affairs.
Board of Directors
The management of affairs and business of the Company is vested in the
Board of Directors comprising a non-executive Chairman, a Managing
Director. Executive Director and 9 Directors who are Non Executive
Directors. The Chairman and Directors of the Company are professionals
and persons of eminence having vast and varied experience.
Pursuant to the provisions of Section 255, 256 and all other applicable
provisions of the Companies Act, 1956, two third of the Directors are
in the category of Directors required to retire by rotation and one
third of those Directors would retire every year and if eligible, they
could seek reappointment at the Annual General Meetings
Meetings of the Board are being held at regular intervals and at least
once in a quarter During the year 2009-10. the Board of Directors met 4
times The Board discharges the duties and responsibilities diligently
as required under the various applicable statute(s) including the
Companies Act. 1956. Directions/Guidelines issued by National Housing
Bank and other regulatory authorities from time to time
Committee of the Board
Boards nf D" i i have constituted Audit Committee Management Committee
and Compensation Committee with appropriate delegations for speedy
decision-making and periodical review of business performance. These
Committees, depending upon the requirements and delegations lake
decisions/prepare the groundwork for decision-making and report at the
subsequent meetings of the Board
Audit Committee
During the year 2009-10, the Audit Committee met thrice. The Committee
in its meetings analyzed financial parameters and progress of the
Company and gave directions for improvement
Management Committee
Management Committee met one time in the year 2009-10. Matters
involving amendments to the credit policy and a comprehensive review of
the Credit and Risk Management function were examined by the committee
before being placed to the Board.
Human Resource Development
The objective of human resource development in an organization is to
enhance human productivity through progressive and consistent policies
in knowledge & skill up gradation and betterment of employment
conditions at all levels. Human resource management''s objective is to
maximize the return on investment from the organization''s human
capital. It is the responsibility of human resource departments in a
corporate context to conduct these activities in an effective, legal,
impartial and cohesive manner.
Your Company worked tirelessly towards the skill up gradation of its
employees by introducing objective performance appraisal mechanism and
performance linked incentive structure and up to date technology
infrastructures. Employees are nominated regularly to attend various
training programmes conducted by NHB, RBI & other capacity development
institutions besides organizing in-house training programmes.
The Company provides a professional work environment and maintains a
healthy relation with its employees. As on 31 March 2010, the number of
people employed by the company stood at 194.
Software Development
RHFL has a web based centralized software solution known as Loan
Origination System (LOS)/ Core Banking Solutions (CBS) in place to
facilitate online sanction of loans
Public Deposits
Your Company has not accepted public deposits during the period under
review Hence the particulars as required under Section 10(1)(a)(b)of
Housing Finance Companies (NHB) Directions, 2001 are not furnished.
Particulars of Employees
There ride no employees covered by Section 217(2A) of the Companies
Act. 1956 read with Companies (Particulars of Employees) Rules 1975 as
amended
Particulars Regarding Conservation of Energy. Technology Absorption and
Foreign Exchange Earnings & Expenditure
Since the Company is not carrying on any manufacturing activity
particulars required relating to Conservation of Energy and Technology
absorption are not furnished There are no transactions involving
foreign exchange earnings or outgo during the year under review.
Directors
Your Directors place on record their appreciation of the valuable
guidance, service and assistance rendered by Shri Mohan Pyare and Shn E
Santhanam who ceased to be Directors of the Company. Shri Mutia
Kalaivanan and Shri C Thangaraju were appointed as Additional Directors
on August 28 ,2009 and March 26 2010 respectively.
In accordance with Articles of the Article of Association and Section
256 of the Companies Act 1956. Shri. A K Goyal Shri Thomas diamond Shri
V Nadanasabapathy and Shri C K. Viswanathan Directors, retire of
rotation at the ensuing Annual General Meeting and being eligible,
offer themselves for re-appointment. Your Directors recommend their
re-appointment
Auditors
M/s R. Subramaman And Company, Chartered Accountants retire as Auditors
of the Company at the conclusion of the forthcoming Annual General
Meeting and being eligible have offered themselves for re-appointment
Directors Responsibility Statement
Pursuance to Section 217(2AA) of the Companies Act, 1956, your
Directors confirm that:
a) in the preparation of the Annual accounts, the applicable accounting
standards have been followed together with proper explanation relating
to material departure if any;
b) the accounting policies have been selected and applied consistently
and the judgments and estimates made are reasonable and prudent so as
to give a fair view of the state of affairs of the Company at the end
of the financial year and the profit of the Company for that period:
c) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company for
preventing and detecting fraud and other irregularities;
d) the annual accounts have been prepared on a going concern basis.
Particulars Relating to Listing of Securities
The shares of the Company are not listed on any stock exchange.
Risk Management
In compliance with the regulatory requirements as stipulated by the
National Housing Bank, the Company has put in place an effective Asset
Liability Management Policy.
The Board of Directors of the Company has constituted a high power
committee to oversee ALM functions. The Commit- tee reviews and
monitors liquidity position and interest rate gap periodically
Investments
The aggregate investment of the Company as on March 31, 2010 is Rs. 5
lakh in Repco Infrastructure Development Company Limited which is in
compliance with NHB guidelines and investment policy of the company
Further the Company has also paid Rs.200 lakh towards subscribing to
equity shares of Repco MSME Limited
Internal Control Systems
The Board of Directors of the Company has already placed
well-articulated internal control measures commensurate with the size
of the organization and intricacies of the business risk The system of
regular inspection by Inspection Department and Internal Audit by
Chartered Accountants firm of selected branches form part of the
internal control system. The audit committee regularly reviews the
significant observations of internal audit and inspection of the
branches. The audit committee observations and recommendations are
being placed before the Board and implemented.
Business Operations Network
The Company is currently having 38 branches and 13 centers across Tamil
Nadu, Andhra Pradesh, Karnataka, Kerala, Pondicherry and Maharashtra
The Company is exploring opportunities for new market expansion in the
states of Tamilnadu, Karnataka, Kerala, Andhra Pradesh Maharashtra and
Orissa to open 28 new branches in FY 2010-2011.
Outlook
The Company''s prospects appear to be bright given its efficacious
treasury management and robust credit appraisal systems A diversified
branch presence across the country in the forthcoming financial year
would help in sustaining the staggering growth rate record achieved
since inception. The variegated sources of funds procured at a cost
effective rate complemented by an increasing trend in credit off take
augurs well for the Company which is poised to achieve impeccable
growth in its profitability in the future
Acknowledgements
The Directors of your Company wish to place on record their sincere
gratitude to NHB and its Executives for their patronage and
whole-hearted support. We also record our gratitude to our bankers,
financial institutions and insurance companies for their continued
trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to REPCO Bank and the
Carlyle Group-the shareholders, Government, local/statutory
authorities, customers and all others for their patronage and support
for the achievements by the Company despite the most competitive
environment in the market.
Your Directors take this opportunity to thank all the executives and
employees of the Company and wish to place on record their commendable
hard work, team spirited efforts and dedicated service to the customers
which enabled the Company to achieve an appreciable level of business
performance during the year.
Place : Chennai For and on behalf of the Board of Directors
Date : April 23, 2010 D.Jothi Jagarajan
Chairman
Mar 31, 2009
The Directors fake pride and pleasure in presenting the 9th Annual
report of your Company with the Audited Accounts for the year ended
March 31,2009.
Financial Results
For the Year
ended For the Year
ended
March 31,2009 March 31,2008
(Rs, in Lakh) (Rs. In Lakh)
Loans Sanctioned 47295 29473
Loans Disbursed 42837 27558
Loans Outstanding 99059 65503
No. of Loan Accounts 18676 15016
Business per employee 846.66 560.00
Net NPA as a % of Net Advances 0.70 0.66
Income from Operation 11462.43 7139.30
Profit before tax 3719.67 1245.37
Less: Provision for tax 1019.17 588.37
Profit after tax 2700.50 1557.00
Balance brought Forward
from previous year 132.53 20.28
Profit available for appropriation 2933.04 1577.26
Appropriation.
Transfer to Special Reserve 770.57 412.49
Transfer to General Reserve 100.00 500.00
Proposed Dividend 509.95 369.47
Corporate Dividend Tax thereon 86.67 62.79
Balance carried forward 1365.35 132.53
Performance Highlights
Lending Operations
During the year 2003-09 your mm pan y accorded sanction to 5196 loan
proposals amounting to R s. 472.95 crore thereby taking the cumulative
sanction so Rs. 1330.99 crore as on 31 March 2009. an incremental
growth of more than 60u o as compared to previous year s sanction
figure of R 3.294.73 crore. The. disbursement du ring the year was FI
s.428.37 crore towards -1917 loan accounts while the cumulative
disbursement stood at Rs. 1276.20 crore as on 31 Match 2009 registering
more than 55% grown over the previous year''s disbursal figure ot
Rs.275.5fl crore. The outstanding at the end of the year was Rs.990.59
crore as against Rs.655.06 crore as on March 31, 2008- once again a
growth rate of more than 51 %, The Company ts proud of this achievement
particularly in a less than buoyant market condition where the major
players are struggling to register 20% growth rate More importantly,
the growth was achieved with due regard to credit quality which is
evident from the GNPA figure of 0.95% and NNPA figure of 0.70% as on
31-3-2009.
Interest rates
The major part of the Iasi fiscal was marked by very high inflation
mainly influenced by international factors, which tightened the
liquidity position and put pressure on spreads forcing most of jihs
home Scan provident increase the Sending rates. However, (he Reserve
Bank of India intend/need after mid-September 2008 by reducing policy
rates like repo, reverse repo and CRR coupled with liquidity enhancing
measure which started taking cascading efforts in the last quarter of
2008- 09. During the first 9 months of the fiscal, when many housing
finance companies increased the home loan rates more than once, your
Company enhanced the interest rates by 75 bps only once during August
2008 while the benchmark PLR was reduced for all new loans up to Rs.20
lakhs by 150 bps and tor more than Rs.20 lakhs by 100 in February 2009
keeping in pace with the market sentiments. We also extended this
benefit to existing customers by lowering interest rates by 50 bps for
all loans released before February 2009 with effect from April 1, 2009.
The Company also introduced risk based pricing from October 2008 by ope
rationalizing the credit-scoring model for each individual borrower.
During mare part to the year your Company maintain# an interest spread
to more than 300 bps relying mainly on operational effectiveness and
low overhead even in the face of rising cost of funds and intense
competition.
Profitability
Your Company achieved a profit before tax (PBT) of FIs. 3719.67lakhs as
against the corresponding figure of Rs. 2145.37 lakhs in the previous
year, registering a growth of more than 73%. Profit after tax (PAT)
also increased by more than 73% to reach the figure of Rs.2700.50 lakhs
from Rs. 1557.00 lakh last year.
Dividend
Your Directors recommend payment of dividend for the year ended March
31 r 2009 at the role of S% on equity and 5% on preference shares. The
dividend shall be paid subject to approval by the shareholders at the
ninth annual general meeting to he held on 19 May. 2009 to such
shareholders whose name appear in the register of members as on the
sa:d date.
Resource Mobilization
Your Company persisted in its effort in holding a diversified resource
base with lowest cost possible for preferred tenures. The resource base
of your Company consists to NHB refinance, term loans from banks and
financial assistance from Repoo Rank. Your Company had applied fore
long-term credit facility from Overseas Private Investment Corporation
(OP1C), USA.A term sheet tor the proposed loan winch is to the lone of
$30 million US Dollars has been executed. Subsequently the approval of
the Reserve Bank of India has been sought with regard to availing the
said facility. The proposal would greatly be instrumental in bringing
down the weighted average cost of borrowings
Refinance from NUB
During the year, your Company has received sanction tor R s. 300.00
crore and availed fresh refinance assistance amounting to Rs.250.00
crore from the National Housing Bank (NHR). As nn 31 March 2009 the
outstanding NHB refinance in our books stands at R$,446.23 crore.
Term Loan from Banks
During the year under review, term loan of Rs 162.2G crore were availed
from the Banks and Financial Institutions, taking the total term loan
outstanding to FIs,403.06 crore. These loans wife drawn air varying
spread below the prime lending rates of the respective banks.
Compliance with NH8 Guidelines
Your Company has been scrupulously conforming to all the guidelines and
directions issued by NHB on asset classification, accounting standards,
income recognition, provisioning, capital adequacy, credit
concentration i investments, credit rating etc., as issued from time to
time.
Capital Adequacy
The Capital Adequacy Hate of me Company as on 31 March 2009 was 24.98%
against the minimum stipulated requirement of 12 00%.
Corporate Governance
In business parlance Corporate Governance is defined as an internal
system encompassing polices, processes and people which caters to the
need of all -stakeholders of the Company by directing and controlling
management activities With objectivity, accountability and integrity.
Sound corporate governance indicates a healthy hoard culture which
safeguards policies and processes in the backdrop of external
marketplace commitment and legislation.
The ethical formation of Repco Group or Companies ensure a culture for
promoting good governance and voluntary compliance facilitating
effective participation of different stakeholders while creating a
framework to best practices, structure and processes clearly defining
the nights and responsibilities of different role players to making
independent and informed decisions on corporate affairs.
Board of Directors
The management of affairs and business of the Company is vested in the
board of Directors comprising a non- executive Chairman, a Managing
Director, executive Director and 9 Directors who are Non Executive
Directors. All Directors, except the Managing Director and executive
Director are independent Directors. The On a i mi an and Directors of
the Company are professionals persons of eminence having vast and
varied experience.
Pursuant to the provisions of Section 25 256 and all other applicable
provisions of the Companies Act, 1956, two third of the Directors are
in the category of Directors inquired 1o retire by notation and one
third of those Directors would retire every year and if eligible, they
could seek reappointment at the Annual General Meetings
Meetings ot the Board are being held at regular intervals and at least
once in a quarter During the year 2008-09. the Board of Directors met 4
times. The board discharges the duties and responsibilities diligently
as required under the various applicable statute(s) including the
Companies Act, 1956; Directions/Guide fees issued by National Housing
Bank and other regulatory authorities from time to time.
Committee of the Board
Boards of Directors have constituted Audit Committee, Management
Committee and Compensation Committee with appropriate delegations for
speedy decision-making and periodical review of business performance,
These Committees, depending upon the ''requirements an 1 relegations,
take decisions/prepare the groundwork for decision-making and report at
the subsequent meetings of the Board.
Audit Committee
During the year 2008-09, the Audit Committee met twice The Committee rn
its meetings analyzed financial parameters and progress of the Company
and gave directions for improvement.
Management Committee
Management Committee met one Time in the year 2008-09. Matters
involving NPA Management, revision of interest rates and review of
sanctions and disbursements of loans, introduction ot new schemes,
schemes for employee benefits etc., were examined by the committee
before being placed to the Board,
Human Resource Development
The objective of human resource development in an organization is lo
enhance human productivity through progressive and consistent policies
in knowledge & skill up gradation and betterment ot employment
conditions at all levels. Human resource management''s objective is or
maximize the return on investment from the organization s human
capital. It is ihe responsibility of human resource departments in a
corporate context to conduct these activities in an effective, segue,
impartial and cohesive manner.
The major task facing the human resource department in an economic
downturn is to identify and recruit effective personnel at moderate
expense without compromising on quality while keeping the existing
workforce also in order
Your Company worked tirelessly towards the skill up gradation of its
employees by introducing objective performance appraisal mechanism and
performance linked incentive structure, by providing so ope for social
networking and up to date technology infrastructures. Employees are
nominated regularly to attend various training programmes conducted by
NHB. HDL & overcapacity development institutions besides organizing
in-house training programmes.
The Company provides a professional woof environment and maintains a
healthy relation with ;ts employees. As on 31 March 2009. the number of
people employed by the company stood at 146.
Software Development
The present applications at RHFL are its own in-hose product. Further
RHFL has a web based centralized software solution known as Loan
Origination System (LOS) in place to facilitate online sanction ot
loans.
Public Deposits
Your Company has not accepted public deposits during the period under
review. Hence the particulars as required under Section 10(1)(aMb) of
Housing Finance Companies (NNB) Directions. 2001 are nut furnished.
Particulars of Employees
There are no employees covered by Section 217(2A) of the Companies Act.
1956 read with Companies (Particulars of employees) Rules 1975 as
amended.
Particulars Regarding Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings & Expenditure
Since the Company is not carrying on any manufacturing activity,
particulars required relating to Conservation of Energy and Technology
absorption are not furnished There are no transactions involving
foreign exchange earnings or outgo during the year under review.
Directors
Your Directors place on record their appreciation of the valuable
guidance, service and assistance rendered by Shri I S.Karn and
Shri.V.Ravindran who ceased to be Directors of the Company. Shri Mohan
are. Dr. Vish warpath Tried, and Shri. A.K.Goyal were appointed as
Additional Directors on 11 April, 2008. 8 September, 2008 and 16 March,
2003 respectively.
In accordance with Articles of the Article ot Association and Section
256 to the Companies Act, 1956, Shri C.K Vishwanathan, Shri Thomas Paul
Diamond. Shri V N adan asabapathy and Shri ESanthanam Directors, retire
by rotation at the ensuing Annual General Meeting and being eligible,
offer themselves for re-appointment. Your Directors recommend their
re-appointment.
Auditors
M/s P Subramanian And Co Chartered Accountant. Chennai. Statutory
Auditors, retire as Auditors of the Company at the conclusion of the
Forthcoming Annual General Mailing and being eligible have offered
themselves for re-appointment.
Directors'' Responsibility Statement
Pursuance to Section 21 7(2AA) ot the Companies Act. 1956, your
Directors confirm that:
a) in the preparation of the annual accounts, the applicable accounting
standards have been together with proper explanation relating to
material departure, it any;
b) the accounting policies have been selected and applied consistently
and the judgments and estimates made are risible and prudent so as to
give a fair view the state to affairs to the Company at the end of the
financial year and the profit of the Company for that period;
c) proper and sufficient carry hay been taker tor the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act. 1956. tor safeguarding the assets of the Company for
preventing and detecting fraud and other irregularities
d) the annual accounts have been prepared on a going concern basis.
Particulars Relating far Listing of Securities
The shares of the Company are not listed on any stock exchange
Risk Management
In compliance with the regulatory requirements as stipulated by the
National Housing Bank, the Company has put in place an effective Asset
Liability Management Policy.
The Board of Directors of the Company has constituted a high power
committee to oversee ALM functions. The Committee reviews And monitors
liquidity portion and interest rate gap periodically.
Treasury Operations
The investment Committee of your Company monitors the investment of
surplus funds to maximize yields The aggregate investment of the
Company as on 31 March 2009 is Rs. 112.37 lakh which is in compliance
with NHS guidelines and investment policy of the company.
The net loss from sale of investment tor the year ended 31 March 2009
is Rs. 112.07 lakh. The dividend received tor the year ended 31 March
200& for the shares held by the Company is Rs. 1.87 lakh.
Internal Control Systems
The Board ot Directors of the Company nas already placed
well-articulated internal control measures commensurate with the size
of the organization and intricacies of the business reek, The system of
regular inspection by Inspection Department and inseam Audit by
Chartered Accountants firm of selected branches form part of the
internal control system The audit committee regularly reviews the
significant observations of internal audit and inspection of the
branches. The audit committee observation are recommendations are being
placed before the Board and implemented.
Business Operations Network
The Company is currently having 30 branches and 12 centers across Tamil
Nadu, Andhra Pradesh. Karnataka, and Kerala & Pondicherry besides the
Corporate Office Chennai. In this year four branches were started at
Mysore. Hyderabad. Hubll and Rajahmundry. The Company is exploring
opportunities for new market expansion in southern states and
Maharashtra and plan open 10-12 new branches in FY £009 2010.
Outlook
The home loan market as a whole is slowing down despite reduction in
property prices owing to reduced affordability and uncertainty hovering
around job market The overall sectored growth rate is estimated to be
around 10-12% last fiscal while some of the more recent market search
findings project disbursal growth for the next 5 years at a single
digit CAGR o'' around 5per cane However, in the long term, factors like
revival In affordability with improved economic performance, favorable
change in socio-demographic factors and underlying asset price
movements are expected to drive the housing finance growth.
For the FY 2009-2010. your Company is thriving to scan even greater
heights with more than 55''o targeted portfolio growth. While we expect
ail our existing brandies to extend their full cooperation to make this
target a reality, the Company is also planning to open 10-12 new
branches in 2009 2010 to expand its network and continue with the
growth momentum from the metro cities owing to rising urbanization as
well as from Tier I and Tier It cities which are experiencing similar
trends of increasing population and demand for housing.
In sync with the market sentiments and prudent practical. RHFL is also
tightening its norms, as the Company is committed to give precedence to
asset quality over growth in these challenging tines.
With empathetic customer service generating word-of-mouth publicity and
enhanced brand awareness, we arc confident of achieving exponential
growth in the coming days,
Acknowledgements
The Directors of your Company wish to place on record their sincere
gratitude to the National Housing Bank and its Executives for 1 hair
patronage and whole-hearted support, We also record our gratitude to
our bankers. finandal institutions and insurance companies tor their
continued trust, support and assistance given to the Company.
The Board places on record its sincere gratitude to REPCQ Bank and the
Carlyle Group-tl.e shareholders, Government, back/statutory
authorities, customers and all others for their patronage and support
for ihe achievements by the Company despite the most competitive
environment in the market.
Your Directors take this opportunity to thank all the executives and
employees of the Company and wish to place on record I heir commendable
hard work, team spirited efforts and dedicated service to the customers
which enabled the Company to achieve an appreciable level of business
performance during the year.
Place : Udhagarnandalam,
For and on behalf of the Board of Directors
Date : 24 April 2009 D.Jothi Jagarajan
Chairman
Mar 31, 2008
The Directors take pride and pleasure in presenting the 8th Annual
Report of your Company with the Audited Accounts for the year ended
March 31, 2008.
Financial Results
For the Year
ended For the Year
ended
March 31, 2008 March 31, 2007
(Rs. in Lakh) (Rs. in Lakh)
Loan Sanctioned 29473 20247
Loan Disbursed 27558 19320
Loan Outstanding 65508 44184
No. of Loan Accounts 15016 11841
Business per employee 560.00 433.00
Net NPA as a % of Not Advances 0.86 1.49
Income from Operation 7139.30 4437.44
Profit before tax 2145.37 1443.79
Less; Provision for tax 538.37 291.04
Profit after tax 1557.00 1152.75
Balance brought forward from
previous year 20.23 38.91
Profit available for appropriation 1577.28 1191.57
Appropriation:
Transfer to Special Reserve 412.49 582.66
Transfer to General Reserve 500.00 150.00
Proposed Dividend 363.47 375.00
Corporate Dividend Tax thereon 62.79 63.73
Balance carried forward 132.53 20.28
Performance Highlights Lending Operations
During the year 2007-06. your Company accorded sanction to 432 loan
proposals amounting to Rs.294.73 crore hereby raking the cumulative
sanction to ft§.308 04 crore as on 31st March 20QB. a growth of around
4#§ as compared to previous year figure of fte.810.6 crore The
disbursement during the year was Rs.275.58 crore towards 4205 loan
accounts while the cumulative stood st Rs. 847.83 as
on 31Sl March 2008 Registering more than 43% growth over the previous
year''s figure of Rs 570.80 crore. The outstanding at the end of the
year was Hs.655.OB crore as against Rs 44i. R4 crore as on March 31 2007
once again a growth rate of more than 48°?. Despite maintaining
high rate of growth, your Company ensure that stringent credit
evaluation norms were adhered to.
interest rates
The Indian cowry witnessed several upheavals during the year and
mounting of inflationary pressure with the government urging the Dan
King sector to continue flow of funds to housing and consumer sectors
ay these were identified as drivers ot the economy Your Company
marginally enhanced the interest rates twice during the year keeping in
tune with the rising cost of funds out maintained concessions for
genuine home seekers by providing cushions for loans up to Hs.2G lakhs
and also extended a festive offer in the form of administrate fee wa
ver and interest rate concessions for all categories of new borrowers
for 2 months in the of FY 2007-03. The Company relied mainly on
operational efficiency and increase in business volume to maintain !ho
spread and profitability even in the takeout rising resource cost and
intense competition.
Profitability
Your Company maintained a comfortable spread during major parts of the
year and achieved a profit before tax (PBT) of Rs. 2145.37 ms as
against the responding figure of Rs. 1443.79 lakhs in the previous
year pestering a growth of mnre than 43%. Profit after lax (PAT) also
increased by more than 35% to reach the figure of Rs.1557 lakhs.
Dividend
Your Directors recommend payment to dividend for the year ended March
31. 2008 at the rate to 8.00% on quay and 5% un preference shares. The
dividend on preference shares is worked out as per the terms of
Shareholders Agreement. The dividend shall be paid subject to approval
by the shareholders at the eighth annual general meeting to be held on
5th May, 200S to such shareholders whose name appear m the$ register of
members as on the$ said date.
Resource Mobilization
Your Company persisted in its effort in building a diversified resource
base with lowest cost possible for preferred tenures The resource base
of your Company consuls of NHB refinance, term loans from banks and
financial assistance from Repco Bank In December 2007, the global PE
major Carlyle Group entered into a strategic partnership with your
Company as Carlyle Asia Growth Capital Partners has committed to pick
up 49 per cent equity stake in RH-L for a consideration of S27.7
million [Rs. HO crore} by 2011 in different tranches out of which we
are already in receipt of the first tranche to Rs.75.94 crore
Refinance from NHB
During the year, your Company has received sanction for Rs 50 00 crore
and availed fresh refinance assistance amounting to Rs 20 00 crore from
the National Housing Bank (NHBI. As on 31st March POOR the outstanding
Nl ID refinance in our books stands at Rs.110.61 crore.
Term Loan from Banks
During the year under review, term loan uf Rs.23n 72 crore were availed
from the Banks and Financial Institutions, taking the total term loan
outstanding to Rs.375.eJ crore. These loans were drawn a varying
spread below the prime lending rates of the respective banks.
Compliance with NHB Guidelines
Your Company has been scrupulously conforming to all the guidelines and
directions issued by NHB on asset classification, accounting standards,
income recognition provisioning, capital adequacy, credit concentration
/ investments, credit rating sin . as issued horn time to time.
Capital Adequacy
The Capital Adequacy Ratio to the Company as on 31 March 2008 was
31.53% against the minimum stipulated requirement of 12.00%. This has
been greatly facilitated by infusion of fresh capital of our new
partner Carlyle Group
Corporate Governance
The basic tenet of Corporate governance is establishing the synergy
between relationships among the different stakeholders and the goals
for which the corporation is governed. Corporate governance thrives to
ensure the accountability to individuals in the organization and to
improve economic efficiency, with a strong emphasis on shareholders
welfare.
On various issues ranging from client service and business excellence
to financial decorum and more, unambiguous rules and regulations
complement the time-honored values on which the Repco Group has bear*
formed.
The corporate governance structure of your Company specifies the
distribution of lights and responsibilities among different
participants, such as. the Board, executives, shareholders and other
slake folders, and spells out the rules and procedures for making
independent and informed decisions on corporate altars. By doing this,
it also provides the structure through which the company objectives are
set, and the means of attaining those objectives and monitoring
performance.
Board ot Directors
The management of affaire arid business of the Company is vested in the
Board of Directors comprising a non-executive Cha ''man, a Managing
Director, Executive Director and S Directors who are Mon Executive
Directors. Ail Directors except the Managing Director and Executive
Director are independent Directors The Chairman and Directors of the
Company are professionals anti persons of eminence having vast and
varied experience.
The Notice of Disclosure of Interest as specified in section 299{1} of
the Companies Act. 19b6 is being furnisher] by die Directors to the
company at the beginning of each financial year and is being placed
before the Board in their meetings} and the same 1$ recorded in the
prescribed statutory records as provided in section 301 (1) of the Act.
Pursuant to the provision* of Section J5G. 256 anri All other
applicable provisions of the Companies Act. 195n. two third to the
Directors are in the category of Directors required to retire by
rotation and one third of those Directors would retire every year and
if eligible, they might seek reappointment at the Annual Genera!
Meetings, Managing Director is being appointed for a term to 3 years
and would be eligible to re appointment on completion to his term.
Meetings of the Board am being held at regular intervals and at least
once in a quarter During the year 2007 08. the Board a of Directors met
4 times, life Board discharges the duties and responsibilities
diligently as required under the various applicable statute(s)
including the Companies Act. 1956 Directions/Guidelines issued by
National Housing Bank and other regulatory authorities from the to
time.
Committee of the Board
Boards of Directors have constituted Audit Committee Management
Committee and Compensation Communities with appropriate delegations for
speedy making and periodical review of business performance. These
Committees depending upon the requirements and delegations, take
decision s/prepare the groundwork for decision-making and report at the
subsequent meetings of the Board
Audit Committee
During the year 2007-03. the Audit Co mm i! fee met two times. The
Committee in its meetings analyzed financial parameters and progress of
the Company and gave directions for improvement.
Management Committee
Management Committee met time in the year 2QQ7-Q8. Matters involving
MPA Management, revision ot interest rates and review of sanctions and
disbursements of loans, introduction of new schemes, schemes for
employee benefits etc.. were examined by the committee before being
placed to the Board.
Human Resource Development
It is a- acknowledged fact that Human Resource is the backbone of any
modern organization, particularly so For service sector institutions.
Properly trained and highly skilled human resource is perceived as the
greatest asset of such an organization They contribute To efficiency
growth, and increased productivity and marten reputation of an
organization In recent years, there have been rapid technological
advancements in various fields all over the world and the rate of
obsolescence of products as went as process has become very htgh In
order to cope with the industry demand and technological advancements,
organa/dons need to develop capacity building strategy for our fib man
capital to attain the required skill levels coupled with proper
retention strategy so as to restrict the probable brain dram.
Your Company works persistently towards the qualitative improvement to
its human capital by imparting training to sharpen their managerial
skills by fa: r performance appraisal by providing scope for social
networking and up to date technology infrastructures. Employees arc
nominated regularly to attend various training programmes conducted by
NHB. RBI & other capacity development institutions besides organizing
in house training programmes.
The Company provides a professional work environment and maintains a
healthy relation with its employees. As on 31 March Rs.408. the number
of people employed by the company stood at 117.
Software Development
The present applications at RHFL are its own n house product It is
proposed to migrate to a web based centralized software solution before
September 2G0B end the development of the samo as under progress
Public Deposits
Your Company has not accepted public deposits during the period under
review. Hence the particulars as required under Section 10{t)(a){b) of
Housing Nance Companies (NHB) Directions, 2001 arc noticed However, the
Company is in the process to Initiating public deposit schemes in the
FY 2008-09.
Particulars of Employees
Since the Company is not carrying on any manufacturing activity,
particulars required relating to Conservation of Energy and Technology
absorption are not furnished. There are no transactions involving
foreign exchange earnings or outgo during the year under review.
Particulars Regarding Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings & Expenditure
Since the Company is not carrying on any manufacturing activity,
particulars required relating to Conservation of Energy and Technology
absorption are not furnished. There are no transactions involving
foreign exchange earnings or outgo during the year under review.
Directors
Your Directors place on record their appreciation of the valuable
guidance service and assistance rendered hy Shri. S Audiseshiah. Shri.
R S Sirohi who ceased lo be Directors of the Company. Shri D Jothi
Jagarajan. I.A.S, SJiri I B Karn were appointed as Additional Directors
on £1v September 2007. Shri. V. Ravindran, Shri M Shankar Narayanan
arid Shri. Mahesh Parasuraman were appointed as Additional Directors on
20 December 2007,
In accordance with Articles of the Article of Association and Section
256 of the Companies Act. 1956. and Shri Thomas Paul Diamond. Shri. V.
Madanasabapathy and Shri E. Santhanann. Directors, ret re by ''Option at
the ensuing Annual General Meeting and being eligible, offers the self
for re- appointment. Your Directors recommend their re-appointment.
Auditors
M/s. R Subramanian and Company, Chartered Accountant, Chennai,
Statutory Auditors, retire as Auditors of the Company at the conclusion
of the forthcoming Annual General Meeting and being eligible have
ottered themselves fur re-appointment.
Directors'' Responsibility Statement
Pursuance to Section 217(2AA} of the Companies Act. 1Q56. your
Directors confirm that:
a) in ihe preparation of the annual accounts, the applicable accounting
standards nave been followed together with proper explanation relating
to material departure, if any:
b) the accounting policies have been selected and applied consistently
and the judgments and estimates made are reasonable and prudent so as
to give a fair view of the state of affairs of the Company at the end
of the financial year and the profit of the Company for that period1.
g) proper SM sufficient care have been taken for the maintenance $
adequate accounting records in accordance with the provisions of the
Companies Act, 1056, for safeguarding the assets of the Company for
preventing and detecting fraud and other irregularities:
d) the annual accounts have been prepared on a going concern basis.
Particulars Relating to Listing to Securities
Being a closely held company, the shares are not listed in any stock
exchange.
Risk Management
In compliance with the regulatory requirements as stipulated by the
National Housing Dank, the Company has pul in place an effective Asset
Liability Management Policy.
The Board of Directors of the Company has constituted a high power
committee to oversee ALM functions. The Committee reviews and monitors
liquidity position and interest rate gap periodically.
Share Capital
The authored capital has been increased room Rs.5D.00 crore to Rs.
100.00 crore during the year and which is divided 1 59,776,000 Equity
shares Of Rs 10/- each; and
2. 40,224,000 Series "A'' Cumulative Fully Convertible Preference
Shares of Rs. 10 each.
During the year, the Company allotted Equity & Preference shares as
detailed below
1) 8,6031.912 Equity Snares of Rs.42/- each for cash at par (feuding
premium to Rs.32A per share} to M/s First Carlyle Growth VI and
Co-Investors Due to this. She issued subscribed and paid up capital of
equity shares increased from fls.3Q.00 wore to Rs.38.60 crore
2) 40,224,000 Series -A" Cumulative fully Convertible Preference Shares
ot Rs. 10/- each fore cast at par Treasury Operations
The Investment Committee of your Company monitors the investment of
surplus funds to maximize yields The aggregate investment of the
Company as on 31 March 2008 was Rs 331.46 lakhs. which in compliance
with NHB guidelines and investment poi fey of the company,
The net income from sale of invest 1 lent for the year ended 31st March
2006 is As. 146.82 lakh. The dividend received for the year ended 31T
March 2008 for the shares held by the Company is Rs.5 lakh
Internal Control Systems
The Board of Erectors of the Company nas already placed
well-articulated internal control measures commensurate with the size
of the organization and intricacies of the business risk. The system of
regular inspection by Inspection Department and Internal Audit by
Chartered Accountants firm of selected branches form part of the
internal control system The audit committee regularly reviews the
significant observations of internal audit and inspection of The
branches. The audit committee observations and recommendations are
being placed before the Board and implemented.
Business Operations Network
The Company is currently having 26 branches and 7 centers across Tamil
Nadu, Andhra Pradesh. Karnataka. Kerala and Pondicherry besides the
Corporate Office at Chennai, f wo new branches were started at Hour and
Then in Tamil Nadu in TV 2007-08. The Company is exponent opportunities
for new market expansion In southern slates and Maharashtra and
planning to open 11 new branches in FY £008-09
New Company for Infrastructure Development
With the satisfactory performance and expertise acquired, your Company
is in a position to spread its wings in hitherto maiden areas such as
infrastructure financing where the supply has no been commensurate to
the growing demand and planning to float a subsidiary m near future
named Repco infrastructure Development Company (RIDC). Your Company''s
well earned goodwill and close rapport with the Central and Southern
State Governments will make the proposed infrastructure development
company a preferred partner for public-private- partnership (PPP)
projects.
Outlook
The home loan market showed signs nr slowing down with property price
correction being imminent in certain parts ot the country, particularly
in respect of some Biggest lenders during 2007-06. After the sub-prime
crisis in the Band its spillover effect in the stock market the mongage
finance sector in India is also expected to subjected rn more minute
regulatory scrutiny and tightening of norms with a view to impart more
discipline in fending and improve the credit appraisal, documentation
and monitoring.
There are bigger challenges lying earned of us as we prepare to scale
higher summits this year aiming for more than 50% portfolio growth
coupled with commensurate growth in profitability with GNPA restricted
below 1.00%.
As always we shall require a coroneted team effort it this journey of
making ourselves a Megaship company in the Indian housing finance,
sector All our branches will have to assume greater responsibility for
bus mess development and he prepared to toil to attain the higher
goals.
We are confident that all FIHFL employees will take up the challenge in
proper spirit and motivate themselves to achieve the same successfully.
Acknowledgements
The Directors to your Company wish to place on record their sincere
gratitude to the National Housing and te Executives for their patronage
and whole-hearted support We also record our gratitude to ICICI
Prudential Late insurance Company Ltd . and United India Insurance
Company Limited and our hankers and financial institutions for their
continued trust, support and assistance given to the Company
The Board places on record its sincere gratitude to Hepco Bank and the
Carlyle Group-the shareholder®, government, local/statutory
authorities and all others tor their patronage and support, for the
achievements by the Company despite the most competitive environment in
the market.
Your Directors take this opportunity to thank alt the executives and
employees ot the Company and wish to place on record their commendable
hard work, team spirited efforts and dedicated service to the customers
which enabled the Company to achieve an appreciable level of business
performance dm in the year.
Place : Chennai For and on behalf of the Board to Directors
Date : 11th April 2008 D Jothi Jagarajan
Chairman
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