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Directors Report of SRG Housing Finance Ltd.

Mar 31, 2015

The Members,

The Directors have pleasure in presenting before you the Annual Report of the Company together with the Audited Statements of Accounts for the year ended 31st March, 2015.

FINANCIAL SUMMARY/HIGHLIGHTS, OPERATIONS & STATE OF AFFAIRS:

Particulars 2014-15 2013-14

Gross Income 687.36 474.05

Less: Finance Cost 239.15 132.68

Overheads 213.44 166.43

Depreciation 7.86 5.29

Profit before Tax & Exceptional Items 226.91 169.65

Add : Exceptional Items 0.00 0.00

Profit before Tax 226.91 169.65

Less : Provision for taxation (Including Deferred tax) 73.33 50.28

Profit after tax 153.58 119.37

Add : Balance b/d from the previous year 140.19 47.52

Surplus available for appropriations 293.77 166.89

Appropriations

Transferred to Special Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 31.00 24.00

Provision for standard Assets 6.56 6.53

Provision for NPA 4.57 (3.48)

Assets W/o as per co. act 2013 0.28 0.00

Def. Tax Liab. On special I.T. Reserve 4.24 0.00

Interim Dividend 28.28 0.00

Dividend Distribution Tax 5.65 0.00

Excess provision 0.42 (0.35)

Balance carried over to Balance Sheet 212.77 140.19

LENDING OPERATIONS & DISBURSEMENT OF LOANS:

Your Company registered a remarkable growth in its operations. The highlights of Company's Performance are as follows:

-The operating profit before charging depreciation and tax amounted to Rs 234.77 lacs in the year 2014-15 as against Rs. 174.95 lacs in the preceding year; representing a rise of 34.19%.

-Profit after Tax (PAT) before extraordinary items went up by 28.66% to Rs. 153.58 lacs in the year 2014- 15 from Rs.119.37 lacs in the previous year.

-As at 31st March, 2015, the loan book stood at Rs. 3867.52 lacs as against Rs. 2639.87 lacs in the previous year an increase of 46.50%.

As part of its liability management, your Company endeavors to diversify its resource base in order to achieve an appropriate maturity structure and minimize the weighted average cost of borrowed funds. Dur- ing the year under review, a fresh term loan of Rs. 30 crores was sanctioned from the State Bank of India.

DIVIDEND:

Your Directors have pleasure informing that the First and foremost Interim Dividend at the rate of Rs. 0.25/- per equity share have been declared and paid to the shareholders resulting in an outflow of Rs. 28.28 lacs in addition to Rs. 5.65 lacs by way of Dividend Distribution Tax.

CHANGES IN SHARE CAPITAL:

During the year under review, the paid up share capital increased as a result of the 2:5 Bonus Issue, whereby your Company allotted 32,32,200 Bonus shares. Consequently the equity share capital has increased from Rs. 8,08,05,000 /- divided into 80,80,500 equity shares of Rs. 10/- each to Rs. 11,31,27,000/- divided into 1,13,12,700 equity shares of Rs 10/- each.

UNCLAIMED DIVIDEND:

Under the provisions of section 125 of Companies Act, 2013 dividends that remain unclaimed for a pe- riod of seven years from the date of declaration are required to be transferred to the Investor Educa- tion and Protection Fund (IEPF) administered by the Central Government. As at March 31st, 2015 there is no unpaid/ Unclaimed Dividend to be transferred to Investor Education & Protection Fund.

MANAGEMENT DISCUSSION AND ANALYSIS:

Pursuant to the Clause 49 of the Listing Agreement with the Bombay Stock Exchange Limited, Report on Management Discussion and Analysis is annexed herewith in Annexure IV.

SUBSIDIARY COMPANIES:

The Company does not have any subsidiary.

DIRECTOR'S 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 esti- mates were made so as to give a true and fair view of the state of affairs of the Company as at March 31st, 2015 and of the profit of the Company for the year ended on 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 frauds and other irregularities;

(d) The annual accounts of the Company have been prepared on a going concern basis.

(e) Internal controls have been laid down to be followed by the Company and such internal controls were adequate and were operating effectively.

(f) Systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

Your Company has taken adequate steps to adhere to all the stipulations laid down in Clause 49 of the Listing Agreement. A report on Corporate Governance is included as a part of this Annual Report in ANNEXURE VI.

Certificate from the Statutory Auditors of the company confirming the compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement is attached to this report.

In terms of Section 136 of the Act, the reports and accounts are being sent to the members and oth- ers entitled thereto.

RELATED PARTY TRANSACTIONS:

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at the link: (http:// www.srghousing.com/PolicyOnRelatedParty.aspx)

Your Directors draw attention of the members to Note 18 to the financial statement which sets out related party disclosures.

RISK MANAGEMENT POLICY:

Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Clause 49 of the listing agreement, the company has in place a risk management committee. The details of the committee and its terms of reference are set out in the corporate governance report forming part of the Boards report.

At present the company has not identified any element of risk which may threaten the existence of the company.

CORPORATE SOCIAL RESPONSIBILTY POLICY:

Pursuant to the provisions of section 135 and schedule VII of the Companies Act, 2013, at present the CSR provisions are not applicable on the Company.

DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS:

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined by board. To maintain its objectivity and independence, the Internal Auditor reports to the Chairman of the Audit Committee of the Board and/or to the Managing Director.

The Internal Auditor 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 loca- tions of the Company.

Based on the report of internal auditor, respective heads undertake corrective action in their re- spective areas and thereby strengthen the controls. Significant audit observations and recommen- dations along with corrective actions thereon are presented to the Audit Committee of the Board.

DIRECTORS:

In accordance with the provisions of the Act and the Articles of Association of the Company Mrs. Seema Jain, Director is liable to retire by rotation at the ensuing Annual General Meeting and being eligible offers herself for re appointment.

During the year under review Mr. Chirag Dharmawat, Independent director resigned from the Inde- pendent Directorship w.e.f 19.02.2015 due to some prior commitments. The same was accepted by the Board in their meeting held on 27.02.2015. The Board places on record its sincere thanks and gratitude for the invaluable contribution made by Shri Chirag Dharmawat towards the growth and development of the company during his tenure as a director.

During the year under review, the Board of Directors on the recommendation of Nomination and Remuneration Committee had appointed Shri Nishant Badala as an Additional Director to hold office in the capacity of Non Executive Independent director in the Company w.e.f. May 14th, 2015 subject to the approval of members in the general meeting.

During the year under review your Directors revised the remuneration of Mr. Vinod K. Jain , Manag- ing Director in accordance with the provisions of Companies Act, 2013 in their meeting held on 28.05.2015. Board also recommended to members to re-appoint Mr. Vinod K. Jain as the Managing Director in this Annual General Meeting for a term of three years from 07.05.2016 to 06.05.2019 on such terms and conditions as approved by Board and members of the Company whose term of office expires on 06th May, 2016.

Your directors recommend their appointment / re-appointment.

All the directors of the Company have confirmed that they are not disqualified from being appointed as directors in terms of Section 164 of the Companies Act, 2013.

DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS:

The Company has received necessary declaration from each Independent Director of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence as laid down in Section 149(6).

AUDITORS:

Statutory Auditors:

At the 15th Annual General Meeting held on September 18th, 2014, the members had appointed M/s Valawat Jha Pamecha & Co. Chartered Accountants (registration No. 008265 C) as the statutory auditors of the Company for a period of 3 years upto the conclusion of 18th Annual General Meeting to be held in the year 2017, subject to them ratifying the said appointment at every AGM. The Company has received a confirmation from M/s Valawat Jha Pamecha & Co. Chartered Accountants, to the effect that their appointment, if made, at the ensuing AGM would be in terms of Sections 139 and 141 of the Companies Act, 2013 and rules made there under. The board proposes to the mem- bers to ratify the said appointment of M/s Valawat Jha Pamecha & Co. Chartered Accountants.

Secretarial Auditors:

M/s Deepak Vijaywargey & Associates, Practicing Company Secretary, Udaipur was appointed as the Secretarial Auditor of the Company for the financial year 2014-15 by the Board of Directors pursuant to provisions of Companies Act, 2013 and rules there under. Secretarial audit report as provided by M/s Deepak Vijaywargey & Associates, Practicing Company Secretary is annexed to this Report as ANNEX- URE II.

QUALIFICATIONS IN AUDIT REPORTS:

There are no qualifications, reservations or adverse remarks or disclaimer made—

(a) By the statutory auditor in his report; and

(b) By the company secretary in practice in his secretarial audit report;

DISCLOSURES:

BOARD MEETINGS:

The Board of Directors met 12 (Twelve) times during this financial year 2014-15.

COMPOSITION OF AUDIT COMMITTEE:

The Audit Committee consists of adequate composition of Executive, Non- Executive and Independent Directors. The details of which are mentioned in the Corporate Governance Report.

COMPOSITION OF NOMINATION & REMUNERATION COMMITTEE:

The Nomination & Remuneration Committee consists of adequate composition of Non- Executive Inde- pendent Directors. The details of which are mentioned in the Corporate Governance Report.

COMPOSITION OF SHAREHOLDER'S /INVESTOR GRIEVANCE COMMITTEE:

The Shareholder's /Investor Grievance Committee consist of adequate composition of Executive, Non- Executive and Independent Directors. The details of which are mentioned in the Corporate Governance Report.

PARTICULARS OF LOANS, GAURANTEES OR INVESTMENTS:

Since the Company is a housing finance Company, the disclosure regarding particulars of loans given, guarantees given and security provided is exempt under the provisions of Section 186 (11) of the Com- panies Act, 2013.

As regards investments, there are no investments made by the Company for the year ended March 31st, 2015.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO:

(A) Conservation of energy:

The Company's operations are not power intensive. Nevertheless, your Company is taking every step to conserve and minimize the use of energy wherever possible such as using energy efficient computer terminals, purchasing energy efficient equipments etc.

(B) Technology absorption:

The Company has imported no technology. Indigenous technology available is continuously up- graded to improve overall performance.

(C) Expenditure incurred on research and development:

The Company has no formal research and development department but the Company is continu- ously making efforts to strengthen research and development activities to improve quality and re- duce cost.

(D) Foreign exchange earnings and Outgo:

During the year under review there was no earnings and outgo in foreign exchange.

EXTRACT OF ANNUAL RETURN:

As required pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, the details forming part of extract of annual return in MGT 9 is annexed herewith as ANNEXURE III.

PARTICULARS OF EMPLOYEES:

In accordance with the provisions of Section 197 of the Companies Act, 2013, read with the Com- panies (Particulars of Employees) Rules, 1975, as at March 31st, 2015, there were no employees in SRGHFL throughout the year who were in receipt of remuneration of Rs. 60 lacs or more per an- num or Rs. 5 Lacs or more per month if appointed for the part of the financial year.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:

There are no material changes and commitments affecting financial position of the company be- tween 31st March and the date of Board's Report.

CHANGE IN THE NATURE OF BUSINESS:

There are no changes in the Nature of Business.

DETAILS RELATING TO DEPOSITS:

The Company has been granted registration by the National Housing Bank, New Delhi as a non- deposit taking Housing Finance Company. Being so, the Company has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS:

The Company has been following directions, guidelines, circulars issued by SEBI, BSE, MCA, NHB etc. from time to time relating to listed companies and that there are no significant & material or- ders passed by these regulators so far.

DISCLOSURES ON MANAGERIAL REMUNERATION:

Details of Managerial remuneration as required under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given as per "Annexure VIII" to this report.

LISTING WITH STOCK EXCHANGES:

The Company confirms that it has paid the Annual Listing Fees for the year 2015-2016 to BSE where the Company's Shares are listed.

INVESTOR COMPLAINTS AND COMPLIANCE:

During the year company received two investor complaints. Company took appropriate action within the stipulated time period. All the investor complaints are duly resolved and as on date no com- plaints are pending.

EARNINGS PER SHARE (EPS):

The Earnings Per Share (EPS) is 1.43 as at March 31st, 2015 as against 1.48 as at March 31 ST, 2014.

Your Company's capital adequacy ratio was at 50.34% as on 31st March, 2015 , which we believe provides an adequate cushion to withstand business risks and is above the minimum requirement of 12% stipulated by the NHB.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY:

Your Company adhered to the prudential guidelines for Non performing Assets (NPAs), issued by the National Housing Bank (NHB) under its Directions of 2010, as amended from time to time. As per the prudential norms, the income on such NPAs is not to be recognized if unrealized.

As per the prudential norms prescribed by the NHB, the Company has made provision for contin- gencies on standard as well as non-performing housing loans and property loans.

A NOTE OF APPRECIATION:

Your Directors place on record their appreciation for the advice, guidance and support given by vari- ous regulatory authorities including the NHB, RBI, SEBI, MCA, the Stock Exchange (BSE), Deposito- ries, Lead Merchant Banker and all the bankers of the Company. The Directors would also like to acknowledge the role of all its stakeholders - shareholders, borrowers, key partners, and lenders for their continuing support to the Company. Your Directors also record their appreciation for the dedicated services of the employees and their contribution to the growth of the Company. The Board would also like to express its sincere appreciation to all the Company's valued Shareholders, RTA, Service Providers and Counselors for their continued support and patronage.

Best Wishes Sd/-

Vinod K. Jain Managing Director DIN:00248843


Mar 31, 2014

Dear members,

The Directors are pleased to present their Fifteenth Annual Report on the business and operations of your Company together with the Audited Accounts for the year ended 31st March, 2 014.

The Financial performance of tlie Company for year ended 11st March, 2014 fe summarized below:

FINANCIAL RLSULTS

Particulars 2013-14 2012-13

Gross Income 474.05 234.52

Less: Finance Cost 132.68 65.15

Overheads 166.43 79.33

Depreciation 5.29 6.17

Profit before Tax & Exceptional ltems 169.65 83.87

Add: Exceptional Items 0.00 0.00

Profit before Tax 169.65 83.87

Less : Provision for taxation (Including deferred tax) 50.28 20.25

Profit after tax 119.37 63.62

Add:Balance b/d from the previous year 47.52 72.44

Surplus available for appropriations 166.89 136.06

Appropriations

Transferred to Special Reserve under 24.00 12.70

Section36(l)(viii) of the lncome Tax Act, 1961 Provision for standard Assets 6.53 4.54

Provision for NPA (3.48) 0.10

Bonus lssue 0.00 71.20

Excess provision (0.35) 0.00

Balance carried over to Balance Sheet 140.19 47.52

PERFORMANCE

Lending Operations & Disbursement of Loans

Your Company registered a remarkable growth in its operations. The operating profit before charging depreciation and tax amounted to Rs.174.94 lacs as against Rs. 90.04 lacs in the preceding year; representing a rise of94.29% Profit After Tax (PAT] before extraordinary items went up by 87.63% to Rs. 119.37 Lacs from Rs. 63.62 Lacs in the previous year.

As at 31st March, 2014, the loan book stood at Rs. 2639.87 Lacs as against Rs. 1883.14 Lac in the previous year an increase of 40.18%.

As part of its liability management, your Company endeavors to diversify its resource base in order to achieve an appropriate maturity structure and minimize the weighted average cost of borrowed funds. During the year under review, fresh term loans of Rs. 1250 Lacs were availed from the State Bank of India.

DIVIDEND

Your Directors felt it prudent to retain the earnings for the year under review to be ploughed back in business, which shall result in further augmentation of the Company''s growth and shareholders'' wealth

CAPITAL ADEQUACY

Particulars As on 31st March 2014 2013

Capital Adequacy Ratio 61.30% 67.40%

Your Company''s capital adequacy ratio was at 61.30% as on 31st March,2014, which we believe provides an adequate caution to withstand business risks and is above the minimum requirement of 12% stipulated by the NHB.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

Your Company adhered to the prudential guidelines for Non performing Assets (NPAs), issued by the National Housing Bank (NHB) under its Directions of 2010, as amended from time to time. As per the prudential norms, the income on such NPAs is not to be recognized if unrealised.

As per the prudential norms prescribed by the NHB, the Company has made provision for contingencies on standard as well as non-performing housing loans and property loans.

PARTICULARS OF EMPLOYEES

During the year under review, no employee of the Company was in receipt of the remuneration in excess of the limits prescribed under section 217(2A) of the Companies Act,1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended.

TECHNOLOGY UPDATION

Regular updation of Systems and procedures is undertaken from time to time to provide checks and alerts for avoiding fraud arising out of misrepresentation given by borrower/s while availing loans.

ENERGY CONSERVATION MEASURES, TECHNOLOGY ABSORPTION ANDR&D EFFORTS AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Pursuantto section 217(l)(e) of the Companies Act,1956, read with the Companies (Disclosure of particulars in the Report of Board of Directors) Rules,1988, as amended, the relevant information is given below:

A. CONSERVATION OF ENERGY:

The Company''s operations are not power intensive. Nevertheless, your Company is taking every steps to conserve and minimise the use of energy wherever possible such as using energy efficient computer terminals, purchasing energy efficient equipments etc.

B. RESEARCH AND DEVELOPMENT :

The Company has no formal research and development department but the Company is continuously making efforts to strengthen research and development activities to improve quality and reduce cost.

C. TECHNOLOGY IMPORT AND ABSORPTION:

The Company has imported no technology. Indigenous technology available is continuously upgraded to improve overall performance.

D. FOREIGN EXCHANGE EARNINGS AND OUT GO:

During the year under review there was no earnings and outgo in foreign exchange.

CORPORATE GOVERNANCE:

Pursuant to the Clause 52of the Listing Agreement with the Bombay Stock Exchange Limited, Report on Corporate Governance is annexed herewith .

MANAGEMENT DISCUSSION AND ANALYSIS:

Pursuant to the Clause 52of the Listing Agreement with the Bombay Stock Exchange Limited, Report on Management Discussion and Analysis Report is annexed herewith .

PUBLIC DEPOSIT:

The Company has been granted registration by the National Housing Bank, New Delhi as a non-deposit taking Housing Finance Company. Being so, the Company has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called.

DIRECTORATE:

Mr. Rajesh Jain (DIN 00212393) and Mr. Chirag Dharmawat (DIN: 05281217), directors of the company liable to retire by rotation and being eligible have offered themselves for re-appointment. As per section 149(5) of the Companies Act, 2013 the Company is required to appoint Independent Directors under section 149(4) within a period of one year from 1.4.2014 i.e. the date of commencement of the said section and Rules made there under. Since the Company had already appointed Mr. Vikas Gupta (DIN: 05280808) and Mr. Ashok Kabra (DIN:00240618) as Independent Directors subject to retirement by rotation in the past, in terms of Companies Act, 1956 and the Listing Agreement with the stock exchanges. Mr. Vikas Gupta and Mr. Ashok Kabra offered themselves for re-appointment as Non-Executive Independent Directors within the meaning of section 149 and 152 [including section 149(10)] of the new Companies Act, 2013 read with Schedule IV attached thereto and Rules made there under, not subject to retirement by rotation, for a term of 5 (five) consecutive years subject to approval of members in general meeting.

AUDITORS:

The Board of Directors of the Company have on the recommendation of the Audit Committee proposed that Pursuant to the provisions of Sections 139-142 and other applicable provisions, if any, of the Companies Act, 2013 read with the underlying rules viz. Companies (Audit and Auditors) Rules, 2014 as may be, M/s Valawat Jha Pamecha & Co. Chartered Accountants (registration No. 008265 C), be reappointed as statutory auditors of the Company, to hold office from the conclusion of this Meeting until the conclusion of the Eighteenth Annual General Meeting (AGM) of the Company, subject to ratification by Members every year on a remuneration (including terms of payment) to be fixed by the Board of Directors of the Company, based on the recommendation of the Audit Committee. M/S Valawat Jha Pamecha & Co., Chartered Accountants, Udaipur have forwarded their certificates to the Company stating that their re-appointment, if made, will be within the limit specified in that behalf in section 141 of the Companies Act, 2013.

Your Directors request you to appoint the auditors and fix their remuneration.

AUDITORS'' REPORT:

The Auditors'' observations are self explanatory and hence do not call for any further clarification under section 217 of the Companies Act,1956.

INVESTOR COMPLAINTS AND COMPLIANCE:

All the investor complaints duly resolved and as on date no complaints are pending.

DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to the requirement under section 217(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement, it is hereby confirmed:

(I) That in the preparation of the accounts for the financial year ended 31st March, 2014; the applicable accounting standards have been followed along with proper explanation relating to material departure

(ii) That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the Company for the year under review;

(iii) That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) That the Directors have prepared the accounts for the financial year ended 31st March, 2014 on a going concern basis.

EARNINGS PER SHARE (EPS):

The Earnings Per Share (EPS) is Rs. 1.48 as at March 31, 2014 as against Rs.0.98 as at March 31, 2013.

REGULATORY GUIDELINES/AMENDMENTS:

The Company has also been following directions, guidelines, circulars issued by SEBI, BSE, MCA, NHB from time to time relating to listed companies.

HUMAN RESOURCES AND TRAINING:

The Company aims to align HR practices with business goals, motivate people for higher performance and build a competitive working environment. Productive high performing employees are vital to the company''s success.

The Company had organised various training programmes for upgrading the skill and knowledge of its employees in different operational areas. The Company also sponsored its employees at various levels to attend various seminars and programmes conducted by various organizations and institutions including Training programmes conducted by the National Housing Bank so as to update their knowledge and to keep them abreast of all the developments in their respective fields.

CODES AND STANDARDS

Fair Practice Code:

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with customers and on the organisation''s policies vis-a-vis client protection. The FPC captures the spirit of the NHB''s guidelines on fair practices for Housing Finance Companies.

Code For Prevention Of lnsider Trading Practices:

Your Company has formulated and adopted a Code for Prevention of lnsider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of lnsider Trading) Regulations, 1992, as amended. The code is applicable to all directors, senior employees and their dependents. The said persons are restricted from dealing in the securities of the Company during the ''restricted trading periods'' notified by the Company, from time to time.

A Note Of Appreciation:

Your Directors place on record their appreciation for the advice, guidance and support given by various regulatory authorities including the NHB, RBI, SEBI, MCA, the Stock Exchange (BSE), Depositories, Lead Merchant Banker and all the bankers of the Company. The Directors would also like to acknowledge the role of all its stakeholders - shareholders, borrowers, key partners, and lenders for their continuing support to the Company. Your Directors also record their appreciation for the dedicated services of the employees and their contribution to the growth of the Company. The Board would also like to express its sincere appreciation to all the Company''s valued Shareholders, RTA, Service Providers and Counsellors for their continued support and patronage.



FOR AND ON BEHALF OF THE BOARD OF DIRECTOR

Sd/-

Vinod K Jain

Chairman & Managing Director Place: - Udaipur Date: - 29th May 2014 DIN:00248843


Mar 31, 2013

To the members of SRG Housing Finance Limited

The Directors are pleased to present their Fourteenth Annual Report on the business and operations of your Company together with the Audited Accounts for the year ended 31st March, 2013.

The Financial performance of the Company for year ended 31st March, 2013 is summarized below:

FINANCIAL RESULT

(Rs. In Lacs)

Particulas 2012-13 2011-12

Less: Finance Cost 6515

Overheads 79 33

Depreciation 617

Profit before Tax & Exceptional Items 83.87 44 08

Add: Exceptional Items 0.00

Profit before Tax 83.87 44.O8

Less: Provision for taxation 20 55 11.8

Profit after tax 63 32

Deferred Tax Assets 0.2 0.1

Add : Balance b/d from the previous year 72.44 53.26

Surplus available for appropriations 136.05 85 58

Appropriations

Transferred to Special Reserve under 12.70 6.50

Section 36(l)(viii) of the Income Tax Act, 1961

Provision for standard Assets 4.54 2.63

Provision for NPA

Bonuslssue 71.20

Balance carried over to Balance Sheet 47 51 72 44

Total 136.05 85.58

PERFORMANCE

Lending Operations Disbursement of Loans:

Your Company registered a remarkable growth in its operations. The operating profit before charging depreciation and tax amounted to Rs.90.05 lacs as against Rs. 47.61 lacs in the preceding year; representing a rise of 89%. Profit After Tax (PAT) before extraordinary items went up by 97% to Rs. 63.32 Lacs from Rs. 32.21 Lacs in the previous year.

The loan disbursed during the year ended 31st March, 2013 was to the extent of Rs. 1446 Lacs as against Rs. 411 Lacs disbursed during the previous year.

As at 31st March, 2013, the loan book stood at Rs. 1883.14 Lacs as against Rs. 757.13 Lacs in the previous year an increase of 149%.

As part of its liability management, your Company endeavors to diversify its resource base in order to achieve an appropriate maturity structure and minimize the weighted average cost of borrowed funds. During the year under review, fresh term loans of Rs. 400 Lacs were availed from the State Bank of India in addition of fresh issue of Shares.

DIVIDEND

Your Directors felt it prudent to retain the earnings for the year under review to be ploughed back in business, which shall result in further augmentation of the Company''s growth and shareholders'' wealth

CAPITAL ADEQUACY

Capital Adequacy Ratio 67% 81%

Your Company''s capital adequacy ratio was at 67% as on 31st March,2013, which we believe provides an adequate cushion to withstand business risks and is above the minimum requirement of 12% stipulated by the NHB.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

Your Company adhered to the prudential guidelines for Non performing Assets (NPAs), issued by the National Housing Bank (NHB) under its Directions of 2010, as amended from time to time. As per the prudential norms, the income on such NPAs is not to be recognised.

As per the prudential norms prescribed by the NHB, the Company has made provision for contingencies on standard as well as non-performing housing loans and property loans.

PARTICULARS OF EMPLOYEES

During the year under review, no employee of the Company was in receipt of the remuneration in excess of the limits prescribed under section 217(2A) of the Companies Act,1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended

INFORMATION TECHNOLOGY AND COMMUNICATIONS

During the financial year 2012-13, apart from upgrading the existing software applications with enhanced/ added features to meet the current and emerging business needs, certain new application systems were implemented.

ENERGY CONSERVATION MEASURES, TECHNOLOGY ABSORPTION AND R&D EFFORTS AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Pursuant to section 217(l)(e) of the Companies Act,1956, read with the Companies (Disclosure of particulars in the Report of Board of Directors) Rules,1988, as amended, the relevant information is given below :

A. CONSERVATION OF ENERGY :

The Company''s operations are not power intensive. Nevertheless, your Company is taking every steps to conserve and minimise the use of energy wherever possible such as using energy efficient computer terminals, purchasing energy efficient equipments etc.

B. RESEARCH AND DEVELOPMENT :

The Company has no formal research and development department but the Company is continuously making efforts to strengthen research and development activities to improve quality and reduce cost.

C. TECHNOLOGY IMPORT AND ABSORPTION :

The Company has imported no technology. Indigenous technology available is continuously upgraded to improve overall performance.

D. FOREIGN EXCHANGE EARNINGS AND OUT GO

During the year under review there was no earnings and outgo in foreign exchange.

INITIAL PUBLIC OFFERING

Company has fully spent / utilized the proceeds of the funds raised under the IPO as per the object of the issue up to 31st March, 2013. The disclosure in compliance with theListing Agreement is as under:

STATEMENT OF UTILIZATION OF ISSUE PROCEEDS BY COMPANY AS ON 31ST MARCH, 2013

(Rs, In Lac)

Granting of Loans 635.00 639.21

To meet the Issue Expenses 65-80 61-59

Total 700.80 700.80

CORPROATE GOVERNANCE :

Pursuant to the Clause 52 of the Listing Agreement with the Bombay Stock Exchange Limited, Report on Corporate Governance is annexed herewith .

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to the Clause 52 of the Listing Agreement with the Bombay Stock Exchange Limited, Report on Management Discussion and Analysis Report is annexed herewith .

PUBLIC DEPOSIT

Your Company has not accepted any deposits from the public during the year under review

DIRECTORATE

Mr. Vikas Gupta and Mr. Ashok Kabra, directors of the company liable to retire by rotation and being eligible have offered themselves for re-appointment.

Further re appointment of Mr Vinod K Jain Chairman and Managing Director on revised remuneration is also approved by board and remuneration committee.

Your Directors recommend the above re-appointments.

BONUS ISSUE

The Company allotted a bonus issue of Shares in the ratio of 2:1 by capitalising Rs. 15255000/-the balance lying in the Reserves and Surplus

PUBLIC ISSUE

During the year under review your Company entred into the capital market with a maiden public issue of 3504000 equity shares of Rs. 10/- each at a premium of Rs. 10/- per share aggregating to Rs.70080000. The issue received an overwhelming response and the same was over subscribed by 1.15 times. The equity shares have been listed and are being traded on the SME platform of the Bombay Stock Exchange Limited.

Subequent upon the bonus and public issue of the shares the issued, subscribed and paid up capital of your Company stands at Rs. 80805000 divided into 8080500 equity shares of Rs. 10/- each.

AUDITORS

The Board of Directors of the Company have on the recommendation of the Audit Committee proposed that M/S Valawat, Jha, Pamecha & Co., Chartered Accountants, Udaipur be re-appointed as the Statutory Auditors of the Company and to hold the office from the conclusion of this meeting till the conclusion of the next Annual General Meeting of the Company. M/S Valawat, Jha, Pamecha & Co., Chartered Accountants, Udaipur have forwarded their certificates to the Company stating that their re-appointment, if made, will be within the limit specified in that behalf in Sub-section (IB) of Section 224 of the Companies Act, 1956. Your Directors request you to appoint the auditors and fix their remuneration.

AUDITORS'' REPORT

The Auditors'' observations are self explanatory and hence do not call for any further clarification under section 217 of the Companies Act,1956.

INVESTOR COMPLAINTS AND COMPLIANCE

All the investor complaints duly resolved and as on date no complaints are pending.

LISTING OF SHARES

The Equity Shares of your Company are listed on the SME platform of Bombay Stock Exchange Limited P. J. Towers, Dalai Street, Mumbai - 400 023 and the listing fees for the year 2013-2014, has been paid.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement, it is hereby confirmed:

(i) That in the preparation of the accounts for the financial year ended 31st March, 2013; the applicable accounting standards have been followed along with proper explanation relating to material departure (ii) That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the Company for the year under review;

(iii) That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) That the Directors have prepared the accounts for the financial year ended 31st March, 2013 on a going concern basis.

ACKNOWLEDGEMENTS

The Directors place on record their appreciation for co-operation and support extended by the Government, NHB, Banks, SEBI, Shareholders, Bankers to issue, RTA and customers for their continued support extended to the company at all times.

The Directors further express their deep appreciation to all employees for commendable teamwork, high degree of professionalism and enthusiastic effort displayed by them during the year

FOR AND ON BEHALF OF THE BOARD OF DIRECTOR

Vinod K Jain

Chairman & Managing Director

Place: - Udaipur

Date: - 24th April, 2013

 
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