Directors Report of Sahara Housingfina Corporation Ltd.

Mar 31, 2018

DIRECTORS’ REPORT

Dear Members,

The Board of Directors of your Company takes pleasure in presenting the Twenty-Seventh Annual Report along with the Audited Financial Statements for the financial year ended March 31,2018.

FINANCIAL RESULTS

The Financial Performance of the Company for the financial year ended March 31, 2018, is summarized below:

(Rs,)

Particulars	2017-18	2016-17
Gross Income	136,387,963	135,933,675
Less:
Interest	50,568,552	52,653,216
Overheads	54,494,355	53,288,722
Depreciation	609,459	473,041
Profit Before Tax (PBT)	30,715,597	29,518,696
Provision for Taxation
- Current Tax	8,153,354	8,975,977
- Deferred Tax	(3,197,488)	788,008
- Income Tax related to earlier years	17,227	(8,661)
Profit After Tax (PAT)	25,742,504	19,763,372
Add: Profit carried from earlier years	136,625,544	122,943,244
Profit available for appropriations	162,368,048	142,706,616
Appropriations
Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of the National Housing Bank Act, 1987	6,756,108	6,081,072
Balance carried to Balance Sheet	155,611,940	136,625,544
Total	162,368,048	142,706,616

PERFORMANCE

Some of the key highlights of your company''s performance during the year under review;

Profit (PBT & PAT) & Income

- The Profit and Loss Account shows a Profit Before Tax (PBT) of Rs, 307.16 lakhs for the year ended March 31, 2018, after making provisions for NPAs and general provision on Standard Loan Assets and taking into account all expenses, including depreciation as against the PBT of Rs, 295.19 lakhs for the previous year ended March 31, 2017. The provision for income tax (net of deferred tax) is Rs, 49.73 lakhs and the Profit After Tax (PAT) for the year is Rs, 257.43 lakhs as against Rs, 197.63 lakhs in the previous year, representing a increase in Net Profit of 30.26 per cent (approx). Taking into account the balance of Rs, 1366.25 lakhs brought forward from the previous year, the distributable profit as at March 31, 2018 is Rs, 1623.68 lakhs.

- The Gross Income for the year under review was Rs, 1363.88 lakhs as against the previous financial year''s income ofRs, 1359.34 lakhs.

Net Owned Fund (NOF) & Assets under Management (AUM)

- Shareholder''s Equity (Net Owned Fund) as at March 31, 2018 was Rs, 3808.42 lakhs as against Rs, 3551.00 lakhs in the previous year, representing an increase of 7.25 per cent.

- The total Assets under Management of the Company as on March 31, 2018 was Rs, 12468.17 lakhs as against Rs, 12180.42 lakhs in the previous year.

Transfer to Special Reserve

During the year under review, your company transferred Rs, 67.56 lakhs to the Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of the NHB Act, 1987.

Deferred Tax Liability on the Special Reserve for the year under review has been created in accordance with the Circular No.: NHB(ND)/DRS/Policy Circular No. 65/2014-15 dated August 22, 2014 issued by the National Housing Bank (NHB).

Earnings per Share (EPS)

The Earnings per share (EPS) as at March 31, 2018 was Rs, 3.68 as against Rs, 2.82 as at March 31, 2017.

Share Capital

The paid up equity share capital as on March 31, 2018 was Rs, 7 Crores, divided into 7,000,000 equity share of face value of Rs, 10 each.

a. Issue of equity shares with differential rights/ buy back

The Company neither issued equity shares with differential rights during the financial year 2017-18 nor bought back any of its shares during the year under review.

b. Issue of sweat equity shares

The Company did not issue any sweat equity shares during the financial year 2017-18.

c. Issue of employee stock options

The Company did not issue any stock options during the financial year 2017-18.

d. Provision by company for purchase of its own shares by employees or by trustees for the benefit of employees

The Company does not have a scheme for purchase of its own shares by employees or by any Trustee for the benefit of employees.

Subordinated Debt

Your Company did not raise any fresh money through subordinate debt during the year under review. As on March 31,2018, your Company''s outstanding subordinated debt was Rs, 25 crore. The debt is subordinated to present and future senior indebtedness of your Company. Interest due thereon has been paid within the due date of payment.

Issue of (Unlisted) Secured Non-Convertible Debenture (NCD)

Your company did not raise fresh money through (Unlisted) Secured Non-Convertible Debentures (NCD) during the year under review. As on March 31, 2018, your Company''s outstanding secured long time borrowing was Rs, 30 Cr. The Interest due thereon has been paid within the due date of payment.

Material Changes & Commitments occurring after the end of Financial Year

No material changes and/or commitments affecting the financial position of the Company occurred between the end of the financial year to which the attached financial statements relate to and upto the date of this report.

Capital Adequacy

As per the Housing Finance Companies (NHB) Directions, 2010, every Housing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of 12 per cent. The Capital Adequacy Ratio of SHCL as on March 31, 2018 was 55.21 per cent. The following table sets out our capital adequacy ratios as at March 31, 2016, 2017 and 2018.

	As at March 31
Particulars
	2018	2017	2016
Capital Adequacy Ratio (%)	55.21	70.11	78.68

Investment in Subsidiaries, Associates, and Joint Ventures

Your Company does not have any subsidiary nor has it made any investment in associates or joint ventures. Consequently, the disclosure requirement as stipulated in terms of sub-section (3) of Section 129 of the Companies Act, 2013, read with rule (5) of the Companies (Accounts) Rules, 2014, is not applicable.

Lending Performance

During the year under review, the Company disbursed loans aggregating to Rs, 2584.66 lakhs as against Rs, 1884.61 lakhs in the previous year March 31, 2017, thereby registering an increase of 37.15%. The overall outstanding loan portfolio as at March 31, 2018 stood at Rs, 12468.17 lakhs as against Rs, 12180.42 lakhs in the previous year March 31, 2017.

The Cumulative Log-in, Sanction and Disbursement as at March 31, 2018 and 2017 are as under:

Particulars	No. of Accounts		Amount (Rs, in lacs)
	2017-18	2016-17	2017-18	2016-17
Cumulative Log-in	6355	6263	65160.71	61372.22
Cumulative Sanction	4163	4081	46432.03	42709.43
Cumulative Disbursement	3958	3877	41448.02	38863.36

Fresh Loans

The year-wise sanction and disbursement details for the previous five years are as under;

(Rs, In Lacs)

Particulars	31.03.18	31.03.17	31.03.16	31.03.15	31.03.14
Sanction	3722.60	2565.20	1697.68	918.50	869.13
Disbursement	2584.66	1884.61	1455.85	1159.97	3893.57

The Company continues to serve from four regions, East (Kolkata), North (Luck now), South (Hyderabad) and West (Mumbai) and eleven branches located at Kolkata, Siliguri, Ranchi, Durgapur, Luck now, Gorakhpur, Mumbai, Pune, Hyderabad, Vijayawada and Visakhapatnam.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

Your Company strictly adheres 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 Company did not recognize any income on such NPAs. The Company has made appropriate provision for contingencies on standard as well as non-performing housing loans and other loans as per the norms set by NHB.

The amount of Gross Non-Performing Assets (GNPA) on the Housing Loan portfolio as on March 31, 2018 was Rs, 708.61 lakhs against Rs, 716.84 lakhs as at March 31, 2017. The Executive Management is taking necessary steps to contain the same within limit.

Dividend

The Board of Director''s felt it prudent to retain the earnings for the year under review to be ploughed back in the lending business which shall result in augmenting the Company''s growth and consequently shareholder''s wealth.

Deposits

Your Company has been granted certificate of registration by National Housing Bank, New Delhi as a non-deposit taking Housing Finance Company. In accordance with the said stipulations the Company under the current management has neither accepted in the past nor has any future plans to accept any public deposits, by whatever mean called. There are no unclaimed deposits as on March 31, 2018.

Particulars of Loans Guarantees 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 provision of Section 186(11) of the Companies Act, 2013.

As regards investments, there are no investments made by the Company for the year ended March 31,2018 except short term investment in Fixed Deposit with Nationalized Bank.

National Housing Bank (NHB) Guidelines

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time.

Other Regulatory Compliance

The Company has also been following directions, guidelines, circulars issued by SEBI, Stock Exchange (BSE) and MCA from time to time pertaining to listed companies.

In order to prevent frauds in loan cases involving multiple lending from different banks / housing finance companies, the Government of India has set up the Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI) under Section 20 of the SARFAESI Act 2002 to have a central database ofall mortgages created by lending institutions. Your Company is registered with

CERSAI and the data in respect thereto is being submitted, from time to time.

Directors and Key Managerial Personnel

Shri Seemanto Roy ceased to be a director of the company with effect from November 13, 2017. The board places on record its appreciation for the contribution made by Shri Seemanto Roy during his tenure on the board of the company since July 18, 2011.

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association, Shri Joy Broto Roy, (DIN: 00432043) (Non-Executive & Non Independent) Director of your Company retires by rotation and is eligible for reappointment at the ensuing Annual General Meeting.

Non of the Non-Independent Directors of the company are related to each other. Brief resumes of the Directors, proposed to be re-appointed, nature of their expertise in specific functional areas and names of other companies in which they hold Directorship along with their Membership / Chairmanship of Committees of the Board as stipulated under Regulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirement) Regulation 2015 are provided in the annexure to the Notice of the Twenty Seventh Annual General Meeting being sent to the members along with the Annual Report.

Based on the confirmations received, none of the Directors are disqualified for being appointed / reappointed as Directors in terms of Section 164 the Companies Act, 2013.

During the year under review, no stock options were issued to the Directors of the Company.

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 the provisions of Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Shri D J Bagchi, CEO & Company Secretary was re-appointed as “Manager” under Section 196,197 and 198asa Key Managerial Personnel under Section 203 of the Companies Act, 2013. The appointment of Shri D J Bagchi expired on July 30, 2018. The Board of Directors of your Company, on the recommendation of the Nomination & Remuneration Committee, thought it prudent to re-appoint Shri D J Bagchi, as Chief Executive Officer and Manager under Section 196, 197, 198, and as a Key Managerial Personnel under Section 203 of the Companies Act, 2013 and rules made thereunder for a further period of three years w.e.f. July 31, 2018 subject to the approval of the members. Necessary resolution for the said re-appointment is being proposed in the notice of the ensuing Annual General Meeting for the approval of the members.

Shri Vivek Kapoor continues to serve your company as Chief Financial Officer (CFO) and a Key Managerial Personnel under Section 203 of the Companies Act, 2013.

Board Meetings

The Board during the relevant financial year had met five times on May 29, 2017, August 14, 2017, September 26, 2017, November 13, 2017 and February 14, 2018 respectively.

Secretarial Standards issued by Institute of Company Secretaries of India (ICSI)

Pursuant to the provisions of the Companies Act, 2013, the Company has complied with the Secretarial Standard on the Meetings of the Board of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2) issued by the Institute of Company Secretaries of India (ICSI) and approved by the Central Government under Section 118(10) of the Companies Act, 2013.

Auditors

In terms of Section 139 of the Companies Act., 2013 M/s Chaturvedi & Partners, Chartered Accountants, (FRN: 307068E) has been appointed as Statutory Auditors of the Company in 26th Annual General Meeting of the Company up to the conclusion of 29th Annual General Meeting of the Company subject to annual ratification. But as per Section 40 of the Companies (Amendment) Act, 2017 (notified vide notification dated 7th May 2018) the provision of ratification of the appointment of Auditors has been omitted; therefore in this Annual General Meeting the appointment of M/s Chaturvedi & Partners will be confirmed for the rest of their tenure without any ratification in upcoming Annual General Meeting during their tenure and Board of Directors of the Company will be authorized to fix their remuneration from time to time.

Notes to Accounts and Auditors Report

No adverse remark or observation is given by the Statutory Auditors. The observations made by the Statutory Auditors in their report, read with the relevant notes to accounts, are complete, transparent and self-explanatory and therefore do not call for any further comments by the Board.

Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Shri P V Subramanian, Practicing Company Secretary (CP: 2077) as the Secretarial Auditor of the Company for the financial year 2017-2018. The Secretarial Audit Report for the financial year ended March 31, 2018, is annexed as “Annexure - 2” to this report.

Directors Responsibility Statement

Your Directors would like to inform that the audited accounts for the year ended March 31, 2018 are in conformity with the requirements of the Companies Act, 2013 and they believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company''s financial condition and results of operations.

These Financial Statements are audited by M/s. Chaturvedi & Partner, Chartered Accountants the Statutory Auditors of the Company and pursuant to the provisions of Section 134(5) of the Companies Act, 2013, it is hereby confirmed that;

a. in the preparation of the annual accounts for the year ended March 31, 2018, the applicable Accounting Standards had been followed along with proper explanation relating to material departures,

b. the directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at March 31, 2018 and of the profit of the Company for that period;

c. the directors had taken proper and sufficient care 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 directors had prepared the annual financial statements on a going concern basis;

e. the directors had laid down Internal Financial Controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

f. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Disclosure under Sub-Section (3) of Section 134 of Companies Act, 2013, Read with Rule 8(3) of the Companies (Accounts) Rules, 2014

Your Company is not engaged in any manufacturing activity and thus its operations are not energy Intensive and the particulars relating to conservation of energy and technology absorption as per Section 134 (3) of the Companies Act,2013, read with Rule 8 (3) of the Companies (Accounts) Rules, 2014, are not applicable. There has been no foreign exchange earnings and outgo during the year under review.

Employee Remuneration

The ratio of the remuneration of each Director to the median employees remuneration and other particulars or details of employees pursuant to Section 197(12) of the Companies Act, 2013 along with the names of top 10 employees in terms of remuneration drawn read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended are attached to this Report as “Annexure - 1”.

Maintenance of Cost Records

Disclosure required for maintenance of Cost Record appears in the Auditors'' Report.

Prevention of Sexual harassment at Work Place

The Company has Zero tolerance towards any action on the part of any executive / staff which may fall under the ambit of ‘Sexual Harassment'' at workplace, and is fully committed to uphold and maintain the dignity of every women executive / staff working in the company. No complaint was filed during the year in this regard.

Corporate Governance & Management Discussion and Analysis

Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section titled Report on Corporate Governance and Management Discussion and Analysis forms part of this Annual Report. The Report on Corporate

Governance also includes certain disclosures that are required, as per Companies Act, 2013.

The certificate by Ms. Mona Agarwal, Company Secretary in Practice [Membership No.: 33191, CoP. No.: 12629] confirming compliance with the conditions of Corporate Governance as stipulated in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Annual Report. The said certificate for financial year 2017-18 does not contain any qualification, reservation or adverse remark.

Internal Control

The Company has an adequate internal audit system in place whereby the Internal Audit is conducted by the Internal Auditors and reports are submitted on a periodic basis. The audit function maintains its independence and objectivity while carrying out its assignments. It evaluates on a continuous basis the adequacy and effectiveness of internal control mechanism, adherence to policies, procedures as well as regulatory and legal requirements. The function also recommends improvement in operational processes and suggests streamlining ofcontrols against various risks. The Audit Committee of the Board reviews the internal audit function on a continuous basis.

Significant I Material Orders Passed by the Regulator or Court or Tribunals

There were no significant / material orders passed by any Regulator or Court or Tribunal which would impact the going concern status of the Company and its future operations.

Change in the Nature of Business

There are no changes in the Nature of Business.

Nomination (Including Boards Diversity) Remuneration & Evaluation Policy

The Board has on the recommendation of the Nomination & Remuneration Committee framed a Nomination (including Boards Diversity), Remuneration & Evaluation Policy, which, inter-alia, lays down the criteria for identifying the persons who are qualified to be appointed as Directors and/or Key Managerial Personnel of the Company, along with the criteria for determination of remuneration of Directors and KMPs including their evolutions and includes other matters, as prescribed under the provisions of the section 178 of Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

During the year under review, your Company has amended the subject policy to align the same with the requirements of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The details of the same are provided in Corporate Governance Report forming part of this Annual Report.

Related Party Transaction Policy & Transactions

Related Party Transaction Policy is intended to ensure requisite approval, reporting and disclosure of transactions between the Company and its related parties. The said policy also defines the materiality of related party transactions and lays down the procedures of dealing with related party transactions.

There were no materially significant related party transactions i.e. transactions of material nature, with its promoters, directors or senior management or their relatives etc. that may have potential conflict with the interest of company at large.

During the year, the Company has not entered into any material contract, arrangement or transaction with related parties, as defined in the SEBI Listing Regulations and Related Party Transaction Policyof the Company. None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company.

The Related Party Policy is available on the website of the Company at the URL http://www.saharahousingfina. com/ annual report/related-party-transaction-policy.pdf

Annual Evaluation of Board Performance and Performance of its Committees and Individual Directors

Provisions of the Companies Act, 2013 mandates formal annual evaluation of the Board of Directors and its committees. The provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, also require that the Board shall monitor and review the Board Evaluation Framework.

The annual performance evaluations of the Board as a whole, all Directors as well as the evaluation of the Board Committees including Audit Committee, Nomination & Remuneration Committee, Risk Management Committee, and Stakeholders Relationship Committee of the Company, were carried out. The details of evaluation process as carried out and the evaluation criteria and framework have been explained in the Corporate Governance Report, forming part of this Annual Report.

Insurance of Company’s Property

Your Company has insured its various properties and facilities against the risk of fire, theft, etc., so that financials are not impacted in the unfortunate event of such incidents. However, your Company does not offer at present Directors and Officers Liability Insurance Policy.

Risk Management Policy & Asset Liability Management Committee (ALCO)

The company has in place Asset Liability Committee (ALCO) which monitors and on an ongoing basis, liquidity, interest rate and funding risks to which the Company is susceptible. Liquidity risk is caused by an asset-liability mismatch resulting from a difference in the maturity profile of the assets and liabilities. Unexpected increases in the cost of funding an asset portfolio, at the appropriate maturity, and the risk of being unable to liquidate a position in a timely manner at a reasonable price, are some of the triggers of this risk.

The liquidity risk among housing finance companies stems from the fact that the assets generated by housing finance companies have an average tenure of 10 - 12 years, while the liabilities have seven to ten years. The Company actively monitors its liquidity position to ensure that it can meet all requirements of its borrowers, while also meeting the requirements of its lenders, and also strengthen its ability to consider investment opportunities as they arise. The Asset Liability Management Committee (“ALCO”), comprising Senior Management Team who lays down policies and quantitative limits which the Audit Committee and the Board are periodically apprised in this regard.

Corporate Social Responsibility Policy

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

Know Your Customer & Anti-Money Laundering Measures

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place, which is strictly adhered to. The said Policy is in line with the National Housing Bank (NHB) guidelines.

The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company is committed to furnish to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions, whether or not made in cash, in terms of the said Policy.

The said policy is available on website of the Company at the URL http://www.saharahousingfina.com/kycp.html.

Fair Practice Code

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organizations policies vis-a-vis client protection. The FPC is being revised and updated to align the same with the improved practices in relation to the dealings of the Company with its customers, and as per the various circulars issued by the National Housing Bank.

The said policy is available on website of the Company at the URL http://www.saharahousingfina.com/fpc.html.

Whistle Blower Policy (Vigil Mechanism)

Pursuant to the provisions of Section 177(9)&(10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has in place a Whistle Blower Policy, which provides for a vigil mechanism that encourages and supports its Directors and employees to report instances of illegal activities, unethical behavior, actual or suspected, fraud or violation of the Company''s Code of Conduct or Ethics Policy. It also provides for adequate safeguards against victimization of persons who use this mechanism and direct access to the Chairman of the Audit Committee in exceptional cases.

The said policy is available on website of the Company at the URL http://www.saharahousingfina.com/wbp.html.

Code of Conduct for Board of Directors and the Senior Management Personnel

Your Company has in place Code of Conduct for the Board of Directors and the Senior Management Personnel to set forth the guiding principles on which the Company and its Board and Senior Management Personnel shall operate and conduct themselves with stakeholders, government and regulatory agencies, media and anyone else with whom it is connected in a professional and respectful manner.

The declaration by the CEO of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance report.

The said policy is available on website of the Company at the URL http://www.saharahousingfina.com/ Code_of_Conduct_Directors_Sr%20Mngmnt_Pe''l_REV ISED_2015.pdf.

Code for Prevention of Insider Trading Practices

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 2015. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company. The code is applicable to the promoters, directors, senior designated employees and the said persons are restricted from dealing in the securities of the Company during the restricted trading periods notified by the Company.

Policy in Disclosure of Material Events and Information

Your Company has formulated and adopted the policy on disclosure of material events and information, in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, to determine the events and information which are material in nature and are required to be discloses to the stock exchanges.

The said policy is available on website of the Company at the URL http://www.saharahousingfina.com/ annual report/Materiality_Policy.pdf

Policy on Preservation of Documents and Records

Your Company has formulated and adopted the policy on documents and records in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The policy ensures that the company complies with the applicable documents retention laws, preservations of various statutory documents and also lays down minimum retention period for the documents and records in respect of which no retention period has been specified by any laws / rule / regulations.

Other Policies as Per NHB Rules/Guidelines

Your Company has formulated and adopted the policies on Partial / Part-Prepayments, Foreclosure / Pre-closure of loan prior to actual / agreed date of closure, Code of Conduct for Direct Selling Agents, Guidelines for Recovery Agents, Policy on Refunds of Fees (AF/PF), etc in order to upgrade the procedures of collecting the information from the prospective borrowers and to ensure fair practices in dealing with the borrowers.

Listing of Shares of the Company

The Equity Shares of your Company continue to remain listed (Group-B) on the BSE Ltd. The Company has paid the listing fees as payable to the BSE Ltd. for the financial year2018-19.

Technology Updating

Your company remains committed to upgrade its existing system software and information technology so as to improve operational efficiencies and optimize cost. However, the financial implications being constraint, the company is steadily progressing to achieve the envisaged goal. During the year under review the dependency on custom driven reporting increased with the partial implementation and commissioning of the in-house developed software module and as a result it is expected that the system and procedures including MIS and reports shall be strengthened with its complete commissioning. In consonance with earlier years, the emphasis continues to improve procedures so as to provide adequate checks and alerts against probable frauds that may arise due to misrepresentation by applicants and even to ensure fair practice in dealing with borrowers.

Depository System

The Company has entered into an agreement with CDSL / NSDL for transaction of shares in dematerialized form. As on March 31, 2018, only 3.05 per cent of the Company''s paid up Share Capital consisting of 2,13,359 shares were held in physical form. As per the Securities and Exchange Board of India''s (SEBI) instructions, the Company''s shares have to be transacted in dematerialized form and therefore, members are requested to convert their holdings to dematerialized form.

Human Resources and Training

Your Company continues its focus to improve human resource competence and capabilities in the Company to deliver the desired / better results. The Company aims to align HR practices with business goals, motivate people for higher performance and build a competitive working environment. Your company strives to ensure overall employee development and retention thus making them a core participant to the Company''s success. Rewarding and recognizing high performing employees are vital to the company''s success. The Board values and appreciates the contribution and commitment of the employees towards performance of your Company during the year. In pursuance of the Company''s commitment to develop and retain the best available talent, the Company continued to offer in-house training programme to staff members in executive development leadership and management skills. The Company continues to sponsor its employees at various levels to attend various seminars, workshops and programmes conducted under the aegis of various organizations and institutions including training programmes conducted by National Housing Bank, ICAI, ICSI & others and firmly believes it to be an investment in building leadership qualities amongst selected promising employees.

Employee relations remained cordial and the work atmosphere remained congenial during the year.

Insurance Coverage to Borrowers

Your Company in tie-up with National Insurance Company Limited offers comprehensive insurance cover product called “National Insurance Sahara Home Loan Suraksha Bima” offering protection to the borrowers (optional) of the Company against the following risks / perils / natural calamities;

A. Personal Accident Insurance: Death due to accident/ accidental loss of two limbs, two eyes or one limb and one eye; Permanent total disablement from injuries other than named above.

B. Property Insurance: Fire / Storm / Earthquake / Riot, Strike and Malicious damage / Lightning / Explosion / Implosion / Aircraft damage, Impact damage / Subsidence and Landslide including Rock Slide / Bursting or Overflowing of Water Tanks & Pipes, Missile testing operations / Leakage from Automatic Sprinkler Installations, Bush Fire / other natural calamities.

The details regarding the product (e.g. Sum insured, premium payable etc.) are explained to the borrowers during personal discussion with them at the time of credit appraisal.

Go Green Initiatives

Like previous year, the go green initiative to send annual report in electronic format to the shareholders who have registered their e-mail ID with their Depository Participant, shall be continued. The shareholders who have not yet registered their e-mail ID are requested to do so to enable the Company to effectively comply with this initiative.

Extract of Annual Return

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014,the extract of the Annual Return as at March 31, 2018, in the prescribed form MGT 9,forms part of this report and is annexed as “Annexure - 3”.

Acknowledgements

Your Directors wish to place on record their gratitude for the continued support of various authorities including the National Housing Bank, SEBI, BSE Limited, NSDL, CDSL and Credit Rating Agency (Informatics Valuation & Rating Private Limited) and also for support and faith reposed in the Company by the Borrowers, all Bankers, Debenture holders, Trustees (Catalyst Trusteeship Limited) and others.

The Board also places on record its deep appreciation for the significant contributions made by its employees at all levels and for the dedication and commitment of the employees as a result of their hard work, co-operation and support, the Company has been able to maintain its consistent growth.

The Board would also like to express its sincere appreciation to the Company''s RTA, Service Providers and Counselors for their continued co-operation.

For and on behalf of the Board of Directors

(Brijendra Sahay) (Anshu Roy)

Kolkata Director Director

^Aug^ust07,2018 (DIN 00017600) (DIN 05257404)

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Mar 31, 2016

Dear Members,

The Board of Directors of your Company take pleasure in presenting the Twenty-fifth Annual Report along with the Audited Financial Statements for the financial year ended March 31, 2016.

FINANCIAL RESULTS

The Financial Performance of the Company for the financial year ended March 31, 2016, is summarized below:

(Rs.)

Particulars	2015-16	2014-15
Gross Income	144,035,625	183,333,338
Less:
Interest	67,900,320	97,361,337
Overheads	46,695,477	52,590,146
Depreciation	610,126	806,762
Profit Before Tax (PBT)	28,829,702	32,575,093
Provision for Taxation
- Current Tax	8,495,765	10,606,264
- Deferred Tax	1,468,800	(31,929)
- Income Tax related to earlier years	26,366	98,225
Profit After Tax (PAT)	18,838,771	21,902,533
Add: Profit carried from earlier years	109,449,611	120,994,022
Profit available for appropriations	128,288,382	142,896,555
Appropriations
Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act, 1961 read with Sec. 29C of the NHB Act, 1987	5,345,138	7,730,312
Deferred Tax Liability on opening balance of Special Reserve	-	25,522,539
WDV Written Off (Net of DTA)	-	194,093
Balance carried to Balance Sheet	122,943,244	109,449,611
Total	128,288,382	142,896,555

PERFORMANCE

Some of the key highlights of your company’s performance during the year under review;

Income & Profit (PBT & PAT)

- The Profit and Loss Account shows a Profit Before Tax (PBT) of Rs. 288.30 lacs for the year ended March 31, 2016, after making provisions for NPAs and general provision on Standard Loan Assets and taking into account all expenses, including depreciation as against the PBT of Rs. 325.75 lacs for the previous year ended March 31, 2015. The provision for income tax (net of deferred tax) is Rs. 99.91 lacs and the Profit After Tax (PAT) for the year is Rs. 188.39 lacs as against Rs. 219.03 lacs in the previous year, representing a decrease in Net Profit of 13.99 per cent (approx). Taking into account the balance of Rs. 1094.50 lacs brought forward from the previous year, the distributable profit as at March 31, 2016 is Rs. 1229.43 lacs.

- The Gross Income for the year under review was Rs. 1440.36 lacs as against the previous financial year''s income of Rs. 1833.33 lacs.

Net Owned Fund (NOF) & Assets under Management (AUM)

- Shareholders'' Equity (Net Owned Fund) as at March 31, 2016 was f 3353.36 lacs as against Rs. 3164.98 lacs in the previous year, representing an increase of 5.95 per cent.

- The total Assets under Management of the Company as on March 31, 2016 was f 12238.71 lacs as against Rs.13731.58 lacs in the previous year.

Transfer to Special Reserve

During the year under review, your company transferred Rs. 53.45 lacs to the Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of the NHB Act, 1987.

Deferred tax liability on the Special reserve for the year under review has been created in accordance with the Circular No. NHB(ND)/DRS/Policy Circular No. 65/2014 15 dated August 22, 2014 issued by the National Housing Bank (NHB).

Earnings Per Share (EPS)

The Earnings per share (EPS) as at March 31, 2016 was f 2.69 as against Rs. 3.13 as at March 31, 2015.

Share Capital

The paid up equity share capital as on March 31, 2016 was Rs. 7 Crores, divided into 7,000,000 equity share of face value off 10each.

a. Issue of equity shares with differential rights/ buy back

The Company neither issued equity shares with differential rights during the financial year 2015-16 nor bought back any of its shares during the year under review.

b. Issue of sweat equity shares

The Company did not issue sweat equity shares during the financial year2015-16.

c. Issue of employee stock options

The Company did not issue any stock options during the financial year2015-16.

d. Provision of money by company for purchase of its own shares by employees or by any trustees for the benefit of employees

The Company does not have a scheme for purchase of its own shares by employees or by trustees for the benefit of employees.

Subordinated Debt

Your Company did not raise any fresh money through subordinate debt during the year under review. As on March 31, 2016, your Company''s outstanding subordinated debt was Rs/ 25 crore. The debt is subordinated to present and future senior indebtedness of your Company. Interest due thereon has been paid within the due date of payment.

Material Changes & Commitments occurring after the end of Financial Year

No material changes and/or commitments affecting the financial position of the Company occurred between the end of the financial year to which the attached financial statements relate to and up to the date of this report.

Capital Adequacy

As per the Housing Finance Companies (NHB) Directions, 2010, every Housing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of 12 per cent. The Capital Adequacy Ratio of SHCL as on March 31, 2016 was 78.68 per cent. The following table sets out our capital adequacy ratios as at March 31,2014, 2015 and 2016.

Particulars	As at March 31
	2016	2015	2014
Capital Adequacy Ratio (%)	78.68	57.50	48.44

Investment in Subsidiaries, Associates, and Joint Ventures

Your Company does not have any subsidiary nor has it made any investment in associates or joint ventures. Consequently, the disclosure requirement as stipulated in terms of sub-section (3) of Section 129 of the Companies Act, 2013, read with rule (5) of the Companies (Accounts) Rules, 2014, is not applicable.

Lending Performance

During the year under review, the Company disbursed loans aggregating to Rs. 1455.85 lacs as against Rs. 1159.97 lacs in the previous year ending March 31, 2015, thereby registering an increasing of 25.51%. The overall outstanding loan portfolio as at March 31, 2016 stood at Rs.12238.71 lacs as against Rs. 13731.58 lacs in the previous year March 31, 2015.

The Cumulative Log-in, Sanction and Disbursement as at March 31, 2016and 2015are as under:

Particulars	No. of Accounts		Amount (Rs. in lacs)
	2015-16	2014-15	2015-16	2014-15
Cumulative Log-in	6182	6104	58810.27	56750.16
Cumulative Sanction	4002	3931	40144.23	38446.55
Cumulative Disbursement	3799	3741	36978.75	35522.90

Fresh Loans

The year-wise sanction and disbursement details for the previous five years are as under;

(Rs. In Lacs)

Particulars	31.03.16	31.03.15	31.03.14	31.03.13	31.03.12
Sanction	1697.68	918.50	869.13	4509.49	2119.48
Disbursement	1455.85	1159.97	3893.57	4039.49	1891.46

The Company continues to serve from four regions, East (Kolkata), North (Lucknow), South (Hyderabad) & West (Mumbai) and thirteen branches located at Kolkata, Asansol, Siliguri, Ranchi, Durgapur, Lucknow, Gorakhpur, Kanpur, Mumbai, Pune, Hyderabad, Vijayawada and Visakhapatnam.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

Your Company strictly adheres 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 Company did not recognize any income on such NPAs. The Company has made appropriate provision for contingencies on standard as well as non-performing housing loans and other loans as per the norms set by NHB.

The amount of Gross Non-Performing Assets (GNPA) on the housing loan portfolio as on March 31, 2016was Rs. 620.88 lacs against Rs. 617.32 lacs as at March 31, 2015.

DIVIDEND

The Board of Directors felt it prudent to retain the earnings for the year under review to be ploughed back in the lending business which shall result in augmenting the Company’s growth and consequently shareholders’ wealth.

DEPOSITS

Your Company has been granted Certificate of Registration by National Housing Bank, New Delhi as a non-deposit taking Housing Finance Company. In accordance to the said stipulation the Company under the current management has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called. There are no unclaimed deposits as on March 31, 2016.

PARTICULARS OF LOANS GUARANTEES 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 provision of Section 186(11) of the Companies Act, 2013.

As regards investments, there are no fresh investments made by the Company during the financial year ended March 31, 2016.

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time.

OTHER REGULATORY COMPLIANCE

The Company has also been following directions, guidelines, circulars issued by SEBI, Stock Exchange (BSE), MCA, from time to time pertaining to listed companies.

In order to prevent frauds in loan cases involving multiple lending from different banks/ housing finance companies, the Government of India has set up the Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI) under Section 20 of the SARFAESI Act 2002 to have a central database of all mortgages created by lending institutions. Your Company is registered with CERSAI and the data in respect thereto is being submitted, from time to time.

Directors and Key Managerial Personnel

Shri Om Prakash Srivastava, (Non-Executive & Non-Independent) Director, (DIN: 00144000), resigned from the Board, with effect from February 15, 2016, due to his pre-occupation with other assignments. The Board places on record its appreciation for the contribution made by Shri Om Prakash Srivastava during his long tenure on the Board of the Company, since August 24, 2002.

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association, Shri Seemanto Roy, (DIN: 00183666) (Non-Executive & Non-Independent) Director of your Company retires by rotation and is eligible for reappointment at the ensuing Annual General Meeting.

None of the Directors of the company is related to each other. Brief resumes of the Director proposed to be re-appointed, nature of his expertise in specific functional areas and names of other companies in which he holds Directorship along with their Membership / Chairmanship of Committees of the Board as stipulated under Regulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirement) Regulations 2015, are provided in the annexure to the Notice of the Twenty Fifth Annual General Meeting being sent to the members along with the Annual Report.

Based on the confirmations received, none of the Directors are disqualified for being appointed / reappointed as Directors in terms of Section 164 the Companies Act, 2013.

During the year under review, no stock options were issued to the Directors of the Company.

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 the provisions of Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Shri D J Bagchi, Chief Executive Officer and Manager under Section 196, 197, 198, and as a Key Managerial Personnel under Section 203 of the Companies Act, 2013 and rules made there under continues to serve your company.

Shri Vivek Kapoor continues to serve your company as Chief Financial Officer (CFO) and a Key Managerial Personnel under Section 203 of the Companies Act, 2013.

BOARD MEETINGS

The Board met five times during the year on May 29, 2015, August 14, 2015, September 28, 2015, November 14, 2015, and February 12, 2016 respectively.

AUDITORS

At the Twenty-third (23rd) Annual General Meeting held on September 29, 2014, the Members had appointed M/s. Chaturvedi & Co., [FRN: 302137E] Chartered Accountants as the Statutory Auditors of the Company, by way of ordinary resolution under section 139 of the Companies Act, 2013, to hold office from the conclusion of Twenty-third (23rd) Annual General Meeting until the conclusion of the Twenty-sixth (26th) Annual General Meeting of the Company, subject to ratification of the appointment by the members of the Company at every Annual General Meeting as per the provisions of the Companies Act, 2013.

Based on the recommendation of the Audit Committee, the Board of Directors at its meeting held on August 12, 2016, recommended continuation of services of M/s. Chaturvedi & Co., Chartered Accountants, as the Statutory Auditors of the Company, and that, the necessary resolution in this respect is being included in the notice of the Twenty-fifth (25th) Annual General Meeting for the approval of the Members of the Company. The Company has received consent from the Statutory Auditor and confirmation to the effect that they are not disqualified to be appointed as the Statutory Auditor of the Company in terms of the provisions of Companies Act, 2013 and Rules framed there under.

NOTES TO ACCOUNTS AND AUDITORS REPORT

No adverse remark or observation is given by the Statutory Auditors. The observations made by the Statutory Auditors in their report, read with the relevant notes to accounts, are complete, transparent and self- explanatory and therefore do not call for any further comments by the Board.

SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Shri P V Subramanian, Practicing Company Secretary (CP: 2077) as the Secretarial Auditor of the Company for the financial year 2015-2016. The Secretarial Audit Report for the financial year ended March 31, 2016, is annexed as “Annexure-2” to this report.

DIRECTORS’ RESPONSIBILITY STATEMENT

Your Directors would like to inform that the audited accounts for the year ended March 31, 2016 are in conformity with the requirements of the Companies Act, 2013 and they believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company’s financial condition and results of operations.

These Financial Statements are audited by M/s. Chaturvedi & Co., Chartered Accountants the Statutory Auditors of the Company and pursuant to the provisions of Section 134(5) of the Companies Act, 2013, it is hereby confirmed that;

a. in the preparation of the annual accounts for the year ended March 31, 2016, the applicable Accounting Standards had been followed along with proper explanation relating to material departures,

b. the directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at March 31, 2016 and of the profit of the Company for that period;

c. the directors had taken proper and sufficient care 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 directors had prepared the annual financial statements on a going concern basis;

e. the directors had laid down Internal Financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

f. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DISCLOSURE UNDER SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

Your Company is not engaged in any manufacturing activity and thus its operations are not energy Intensive and the particulars relating to conservation of energy and technology absorption as per Section 134 (3) of the Companies Act,2013, read with Rule 8 (3) of the Companies (Accounts) Rules, 2014, are not applicable. There has been no foreign exchange earnings and outgo during the year under review.

EMPLOYEE REMUNERATION

I. The ratio of the remuneration of each director to the median employee''s remuneration and other details in terms of sub-section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are forming part of this report and is annexed as “Annexure -1” to this Report.

II. Since no employee is in receipt of remuneration in excess of the limits as laid down under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and Rule 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, no disclosures in this regard are applicable.

CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section titled ‘Report on Corporate Governance'' and ‘Management Discussion and Analysis'' forms part of this Annual Report. The Report on Corporate Governance also includes certain disclosures that are required, as per Companies Act, 2013.

The certificate by the Statutory Auditors confirming compliance with the conditions of Corporate Governance as stipulated in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015forms part of this Annual Report. The said certificate for financial year 2015-16 does not contain any qualification, reservation or adverse remark.

INTERNAL CONTROL

The Company has an adequate internal audit system in place whereby the Internal Audit is conducted by the Internal Auditor and reports are submitted on a periodic basis. The audit function maintains its independence and objectivity while carrying out its assignments. It evaluates on a continuous basis the adequacy and effectiveness of internal control mechanism, adherence to policies, procedures as well as regulatory and legal requirements. The function also recommends improvement in operational processes and suggests streamlining of controls against various risks. The Audit Committee of the Board reviews the internal audit function on a continuous basis.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS

There were no significant/material orders passed by any Regulator or Court or Tribunal which would impact the going concern status of the Company and its future operations.

CHANGE IN THE NATURE OF BUSINESS

There are no changes in the nature of Business.

NOMINATION (INCLUDING BOARDS’ DIVERSITY) REMUNERATION & EVALUATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination (including Boards'' Diversity), Remuneration & Evaluation Policy, which, inter-alia, lays down the criteria for identifying the persons who are qualified to be appointed as Directors and/or Key Managerial Personnel of the Company, along with the criteria for determination of remuneration of Directors and KMPs including their evaluation and includes other matters, as prescribed under the provisions of Section 178 of Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

During the year under review, your Company has amended the subject policy to align the same with the requirements of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The details of the same are provided in Corporate Governance Report forming part of this Annual Report.

RELATED PARTY TRANSACTION POLICY & TRANSACTIONS

Related Party Transaction Policy intended to ensure requisite approval, reporting and disclosure of transactions between the Company and its related parties. The said policy also defines the materiality of related party transactions and lays down the procedures of dealing with related party transactions.

There were no materially significant related party transactions i.e. transactions of material nature, with its promoters, directors or senior management or their relatives etc. that may have potential conflict with the interest of company at large.

During the year, the Company has not entered into any material contract, arrangement or transaction with related parties, as defined in the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Related Party Transaction Policy of the Company. None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company.

The Related Party Policy is available on the website of the Company at the URL http://www.saharahousingfina.com/ annual report/related-party-transaction-policy.pdf

ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Companies Act, 2013 mandates formal annual evaluation of the Board of Directors and its committees. The provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, also require that the Board shall monitor and review the Board Evaluation Framework.

The annual performance evaluation of the Board as a whole, all Directors as well as the evaluation of the Board Committees including Audit Committee, Nomination & Remuneration Committee, Risk Management Committee, and Stakeholders’ Relationship Committee of the Company, was carried out. The details of evaluation process as carried out and the evaluation criteria and framework have been explained in the Corporate Governance Report, forming part of this Annual Report.

INSURANCE OF COMPANY’S PROPERTY

Your Company has insured its various financed properties and facilities against the risk of fire, theft, etc., so that financials are not impacted in the unfortunate event of such incidents. However, your Company does not offer at present Directors’ and Officers’ Liability Insurance Policy.

RISK MANAGEMENT POLICY & ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Company is exposed to various types of risks such as credit risk, market risk, legal risks, interest rate risk, liquidity risk, and operational risk. The Company is aware of these factors and have given importance on risk management practices to ensure an appropriate balance between risks and returns.

The Company has put in place a comprehensive risk management policy and framework to identify, assess and monitor various risks. Risk management is driven by the Board with the overall responsibility assigned to the Risk Management Committee of the Board of Directors. At the operational level, risk management is assigned to the Asset Liability Management Committee (“ALCO”). Your Company conducts risk profiling on a regular basis for the purpose of self-assessment.

The Asset Liability Management Committee (“ALCO”) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has duly implemented NHB’s Asset Liability Management Guidelines.

CORPORATE SOCIAL RESPONSIBILITY POLICY

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

CODES, STANDARDS AND POLICIES

‘Know Your Customer & Anti-Money Laundering Measures

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place, which is strictly adhered to. The said Policy is in line with the National Housing Bank (NHB) guidelines.

The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash/suspicious transactions. The Company is committed to furnish to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions, whether or not made in cash, in terms of the said Policy.

The said policy is available on website of the Company at the URL http://www.saharahousingfina.com/kycp.html.

Fair Practice Code

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organization’s policies vis-a-vis client protection. The FPC is being revised and updated to align the same with the improved practices in relation to the dealings of the Company with its customers, and as per the various circulars issued by the National Housing Bank.

The said policy is available on website of the Company at the URL http://www.saharahousingfina.com/fpc.html.

Whistle Blower Policy (Vigil Mechanism)

Your company has, pursuant to the provisions of Section 177(9) & (10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has in place a Whistle Blower Policy, which provides for a vigil mechanism that encourages and supports its Directors and employees to report instances of illegal activities, unethical behaviour, actual or suspected, fraud or violation of the Company’s Code of Conduct or Ethics Policy. It also provides for adequate safeguards against victimization of persons who use this mechanism and direct access to the Chairman of the Audit Committee in exceptional cases.

The said policy is available on website of the Company at the URL http://www.saharahousingfina.com/wbp.html.

Code of Conduct for Board of Directors and the Senior Management Personnel

Your Company has in place a Code of Conduct for the Board of Directors and the Senior Management Personnel to set forth the guiding principles on which the Company and its Board and Senior Management Personnel shall operate and conduct themselves with stakeholders, government and regulatory agencies, media and anyone else with whom it is connected in a professional and respectful manner.

The declaration by the CEO of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management Personnel is annexed with the Corporate Governance report.

The said policy is available on website of the Company at the URLhttp://www.saharahousingfina.com/Code_of_Conduct_ Directors_Sr%20Mngmnt_Persl_REVISED_2015.pdf.

Code for Prevention of Insider Trading Practices

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 1992 and 2015. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company. The code is applicable to the promoters, directors, senior designated employees and the said persons are restricted from dealing in the securities of the Company during the ‘restricted trading periods’ notified by the Company.

Policy on Disclosure of Material Events and Information

During the year under review, your Company has adopted the Policy on Disclosure of Material Events and Information, in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 to determine the events and information which are material in nature and are required to be disclosed to the Stock Exchanges.

The said policy is available on the website of the Company at the URL http://www.saharahousingfina.com/annualreport/ Materiality_Policy.pdf.

Policy on Preservation of Documents and Records

During the year under review, your Company has adopted the Policy on Preservation of Documents and Records in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy ensures that the Company complies with the applicable document retention laws, preservation of various statutory documents and also lays down minimum retention period for the documents and records in respect of which no retention period has been specified by any law/rule/regulation.

Other Policies as Per NHB Rules/Guidelines

Your Company has framed policies on ‘Policy on Partial / Part-Prepayment’, ‘Foreclosure / Pre-closure of loan prior to actual/agreed date of closure’, ‘Code of Conduct for Direct Selling Agents’, ‘Guidelines for Recovery Agents’, ‘Policy on Refunds of Fees (AF/PF)’, etc in order to upgrade the procedures of collecting the information from the prospective borrowers and to ensure fair practices in dealing with the borrowers.

LISTING OF SHARES OF THE COMPANY

The Equity Shares of your Company continue to remain listed (Group-B) on the BSE Ltd. The Company has paid the listing fees as payable to the BSE Ltd. for the financial year 2016 -17.

TECHNOLOGY UPDATION

Your Company remains committed to upgrade its existing system software and information technology so as to improve operational efficiency and optimize cost. However, the financial implications being a constraint, the company is steadily progressing to achieve the envisaged goal. During the year under review the dependency on custom driven reporting increased with the partial implementation and commissioning of the in-house developed system software module and as a result it is expected that the system and procedures including MIS and reports shall be strengthened with its complete commissioning.

In consonance with earlier years, the emphasis continues to improve procedures so as to provide adequate checks and alerts against probable frauds that may arise due to misrepresentation by applicants and even to ensure fair practice in dealing with borrowers.

DEPOSITORY SYSTEM

The Company has entered into an agreement with CDSL/ NSDL for transaction of shares in dematerialized form. As on March 31, 2016, only 3.05 per cent of the Company’s paid up Share Capital consisting of 2,13,888 shares were held in physical form. As per the Securities and Exchange Board of India’s (SEBI) instructions, the Company’s shares have to be transacted in dematerialized form and therefore, members are requested to convert their holdings to dematerialized form.

HUMAN RESOURCES AND TRAINING

Your Company continues its focus to improve human resource competence and capabilities in the Company to deliver the desired/better results. The Company aims to align HR practices with business goals, motivate people for higher performance and build a competitive working environment. Your Company strives to ensure overall employee development and retention, thus making them a core participant to the Company’s success. Rewarding and recognizing high performing employees are vital to the company’s success. The Board values and appreciates the contribution and commitment of the employees towards performance of your Company during the year. In pursuance of the Company’s commitment to develop and retain the best available talent, the Company continued to offer in-house training programme to staff members in executive development, leadership and management skills. The Company continues to sponsor its employees at various levels to attend various seminars, workshop and programmes conducted under the aegis of various organizations and institutions including training programmes conducted by National Housing Bank, ICAI, ICSI & others and firmly believe it to be an investment in building leadership qualities amongst selected promising employees.

Employee relations remained cordial and the work atmosphere remained congenial during the year.

INSURANCE COVERAGE TO BORROWERS

Your Company in tie-up with National Insurance Company Limited offers comprehensive insurance cover product called “NATIONAL INSURANCE SAHARA HOME LOAN SURAKSHABIMA” offering protection to the borrower/co-borrowers (optional) of the Company against the following risks/perils/natural calamities:

A Personal Accident Insurance: Death due to accident/ accidental loss of two limbs, two eyes or one limb and one eye; Permanent total disablement from injuries other than named above.

B Property Insurance: Fire/Storm / Earthquake/Riot, Strike and Malicious damage/Lightning/Explosion/Implosion /Aircraft damage, Impact damage/Subsidence and Landslide including Rock Slide/Bursting or Overflowing of Water Tanks & Pipes, Missile testing operations/Leakage from Automatic Sprinkler Installations, Bush Fire/other natural calamities.

The details regarding the product (e.g. Sum insured, premium payable etc.) are explained to the borrowers during personal discussion with them at the time of credit appraisal.

During the year under review, your Company filed two accidental death claims in respect of borrowers of the Company. While one claim was settled during the financial year 2015-16, the second claim has been settled as on the date of this report.

GO GREEN INITIATIVES

Like previous year, the go green initiative to send annual report in electronic format to the shareholders who have registered their e-mail ID with their Depository Participant, shall be continued. The shareholders who have not yet registered their e-mail ID are requested to do so to enable the Company to effectively comply with this initiative.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014,the extract of the Annual Return as at March 31, 2016, in the prescribed form MGT 9, forms part of this report and is annexed as “Annexure - 3”.

ACKNOWLEDGEMENTS

The Directors place on record their appreciation for the advice, guidance and support given by the National Housing Bank, SEBI, BSE Limited, the National Stock Exchange of India Limited, National Securities Depository Limited, Central Depository Services (India) Limited and the Credit Rating Agencies, the Company’s Borrowers, all the Bankers and others for their continued support and faith reposed in the Company.

The Board also places on record its deep appreciation for the dedication and commitment of the employees at all levels as their hard work, co-operation and support had enabled the Company to maintain its profitability status.

The Board would also like to express its sincere appreciation to the Company’s RTA, Service Providers and Counselors for their continued co-operation.

For and on behalf of the Board of Directors

(Brijendra Sahay) (Anshu Roy)

K_olkata Director Director

August 12,2016 (DIN 00017600) (DIN 05257404)

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Mar 31, 2015

Dear Members,

The Board of Directors of your Company take pleasure in presenting the Twenty-fourth Annual Report along with the Audited Financial Statements for the financial year ended March 31,2015.

FINANCIAL RESULTS

The Financial Performance of the Company for the financial year ended March 31,2015, is summarised below:

(Rs)

Particulars 2014-2015 2013-2014

GROSS INCOME 18,33,33,338 21,10,85,348

Less:

Interest 9,73,61,337 11,94,06,184

Overheads 5,25,90,146 5,48,76,542

Depreciation 8,06,762 13,18,596

Profit Before Tax (PBT) 3,25,75,093 3,54,84,026

Provision for Taxation

- Current Tax 1,06,06,264 1,07,54,928

- Deferred Tax (31,929) (17,46,134)

- Income Tax related to 98,225 65,434 earlier years

Profit After Tax(PAT) 2,19,02,533 2,64,09,798

Add:Profit carried from 12,09,94,022 10,23,54,289 earlier years

Profit available for appropriations 14,28,96,555 12,87,64,087

Appropriations

Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act, 1961 read with Sec. 29C of the NHB Act, 1987 77,30,312 77,70,065

Deferred Tax Liability on 2,55,22,539 - opening balance of Special Reserve

WDV Written Off (Net of DTA) 1,94,093 -

Balance carried to Balance Sheet 10,94,49,611 12,09,94,022

Total 14,28,96,555 12,87,64,087



PERFORMANCE

Some of the key highlights of your company's performance during the year under review;

Income & Profit (PBT & PAT)

. The Profit and Loss Account shows a Profit Before Tax (PBT) of Rs 325.75 lacs for the year ended March 31,2015, after making provisions for NPAs and Loan Assets and taking into account all expenses, including depreciation as against the PBT of Rs 354.84 lacs for the previous year ended March 31, 2014. The provision for income tax (net of deferred tax) is Rs 106.73 lacs and the profit after tax for the year is Rs 219.03 lacs as against Rs 264.10 lacs in the previous year, representing a decrease in Net Profit of 17 per cent (approx). Taking into account the balance of Rs 1209.94 lacs brought forward from the previous year, the distributable profit is Rs 1094. 50 lacs.

. The Gross Income for the year under review was Rs 1833.33 lacs as against the previous financial year's income of Rs 2110.85 lacs representing a decrease in gross total income by 13 per cent (approx).

Net Owned Fund (NOF) & Assets under Management (AUM)

. Shareholders' Equity (Net Owned Fund) as at March 31, 2015 was Rs 3164.98 lacs as against f 3203.12 lacs in the previous year, representing a marginal decrease of 1.19 per cent. The same is on account of creation of provision for deferred tax liability on Statutory Reserve.

. The total Assets under Management of the Company as on March 31, 2015 was Rs13731.58 lacs as against Rs16301.40 lacs in the previous year, representing a decrease of 15.76 per cent.

Transfer to Special Reserve

During the year under review, your company transferred Rs 77.30 lacs to the Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of the NHB Act, 1987. Deferred tax liability on the Special Reserve created during the current year has been appropriated from Profit & Loss Account amounting to Rs 25.08 lacs, in accordance with the National Housing Bank (NHB) Guidelines. National Housing Bank vide circular No. NHB (ND)/DRS/Policy Circular 65/2014- 15 dated August 22, 2014 has clarified that deferred tax liability (contingent upon Company's withdrawal Reserves under Section 36(1)(viii) of the Income Tax Act, 1961) in respect of the balance in special reserve as at April 1,2014 may be adjusted from the opening free reserves of the Company over a period of three years in the ratio of 25:25:50 respectively.

Your Company has adjusted its opening reserves as at April 1, 2014 with an amount of Rs 255. 23 lacs being 100 per cent contingent deferred tax liability on the opening balance of Statutory Reserve of Rs 786.64 lacs

Earnings Per Share (EPS)

The Earnings per share (EPS) as at March 31,2015 was Rs 3.13 as against Rs 3.77 as at March 31,2014.

Share Capital

The paid up equity share capital as on March 31, 2015 was Rs 7 Crores, divided into 7,000,000 equity share of face value of Rs. 10 each.

a. Issue of equity shares with differential rights/ buy back

The Company neither issued equity shares with differential rights during the financial year 2014-15 nor bought back any of its shares during the year under review.

b. Issue of sweat equity shares

The Company did not issue sweat equity shares during the financial year 2014-15.

c. Issue of employee stock options

The Company did not issue stock options during the financial year 2014-15.

d. Provision of money by company for purchase of its own shares by employees or by trustees for the benefit of employees

The Company does not have a scheme for purchase of its own shares by employees or by trustees for the benefit of employees.

Subordinated Debt

Your Company did not raise money through subordinate debt during the year. As on March 31, 2015, your Company's outstanding subordinated debt were f 25 crore. The debt is subordinated to present and future senior indebtedness of your Company. Interest due thereon has been paid within the due date of payment.

Material Changes & Commitments occurring after the end of Financial Year

No material changes and/or commitments affecting the financial position of the Company occurred between the end of the financial year to which the attached financial statements relate to and upto the date of this report.

Term Loan from ICICI Bank

Your Company has repaid term loan taken from ICICI Bank (amount outstanding as on December 15, 2014 amounting to Rs 13,57,05,200 along with interest due thereon till such date amounting to f 5,88,079) on December 15, 2014.

Capital Adequacy

As per the Housing Finance Companies (NHB) Directions, 2010, every Housing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of 12 per cent. The Capital Adequacy Ratio of SHCL as on March 31,2015was 57.50 per cent. The following table sets out our capital adequacy ratios as at March 31, 2013, 2014and 2015.

Particulars As at March 31

2015 2014 2013

Capital Adequacy Ratio 57.50 48.44 50.76

INVESTMENT IN SUBSIDIARIES, ASSOCIATES, AND JOINT VENTURES

Your Company does not have any subsidiary nor has it made any investment in associates or joint ventures. Consequently, the disclosure requirement as stipulated in terms of sub-section (3) of Section 129 of the Companies Act, 2013, read with rule (5) of the Companies (Accounts) Rules, 2014, is not applicable.

LENDING PERFORMANCE

During the year under review, the Company disbursed loans aggregating to f 1159.97 lacs as against f 3893.57 lacs in the previous year March 31,2014. The outstanding loan portfolio as at March 31,2015 stood at rs 13731.58 lacs as against rs 16301.40 lacs in the previous year March 31,2014.

The Cumulative Log-in, Sanction and Disbursement amount as n March 31, 2015 and 2014 are as under:

No. of Amount Particulars Accounts Rs in lacs)

2014-15 2013-14 2014-15 2013-14

Cumulative Log-in 6104 6037 56750.16 55743.83

Cumulative Sanction 3931 3867 38446.55 37528.05

Cumulative Disbursement 3741 3674 35522.90 34362.93

Fresh loans

The year-wise sanction and disbursement details for the previous five years are as under;

(Rs In Lacs)

Particulars 31.03.l5 31.03.14 31.03.13 31.03.12

Sanction 918.50 869.13 4509.49 2119.48

Disbursement 1159.97 3893.57 4039.49 1891.46

Particulars 31.03.11

Sanction 2447.59

Disbursement 3319.06



The Company continues to serve from four regions (Kolkata, Lucknow, Hyderabad and Mumbai) and thirteen branches (Kolkata, Asansol, Siliguri, Ranchi, Durgapur, Lucknow, Gorakhpur, Kanpur, Mumbai, Pune, Hyderabad, Vijayawada and Visakhapatnam).

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

The Company strictly adheres 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 Company did not recognise the income on such NPAs. The Company has made provision for contingencies on standard as well as non-performing

housing loans and property loans as per the norms.

The amount of gross Non- Performing Assets (NPA) as on March 31,2015 was Rs 617.32 lacs, which is equivalent to 4.50 per cent of the loan portfolio of the Company as against Rs 254.59 lacs, which is 1.56 per cent of the housing loan portfolio as at March 31, 2014.

DIVIDEND

The Board of Directors felt it prudent to retain the earnings for the year under review to be ploughed back in the lending business which shall result in augmenting the Company's growth and consequently shareholders' wealth.

DEPOSITS

Your Company is registered as a non-deposit taking Housing Finance Company with National Housing Bank (NHB), New Delhi. The Company has neither accepted in the past nor has any future plans, by virtue of its registration, to accept any public deposits, by whatever name called. Accordingly, the Company has not accepted / renewed any deposits during the year. There are no unclaimed deposits as on March 31,2015.

PARTICULARS OF LOANS GUARANTEES 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 provision of Section 186(11) of the Companies Act, 2013.

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

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time.

OTHER REGULATORY COMPLIANCE

The Company has also been following directions, guidelines, circulars issued by SEBI, Stock Exchange (BSE), MCA, from time to time pertaining to listed companies.

In order to prevent frauds in loan cases involving multiple lending from different banks/ housing finance companies, the Government of India has set up the Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI) under Section 20 of the SARFAESI Act 2002 to have a central database of all mortgages created by lending institutions. Your Company is registered with CERSAI and the data in respect thereto is being submitted, from time to time.

DIRECTORS

Shri Sakti Prasad Ghosh, (DIN : 00183802) Independent & Non- executive Director, has resigned from the Board with effect from May 29, 2014, due to his pre-occupation with other assignments. The Board places on record its deep appreciation for the contribution made by Shri Sakti Prasad Ghosh during his long tenure as a Director of the Company, since March 10, 2003.

Shri Joy Broto Roy, (Non-independent) Director, (DIN: 00432043), resigned from the Board, with effect from March 16, 2015, due to his pre-occupation with other assignments. The Board places on record its appreciation for the contribution made by Shri Joy Broto Roy during his long tenure on the Board of the Company, since August 24, 2002.

Shri Ranoj Dasgupta, (DIN : 00216165) Independent & Non- executive Director, has resigned from the Board with effect from April 1,2015, due to his deteriorating health, age related medical concerns and his consequent inability to devote sufficient time to the Company. The Board places on record its deep appreciation for the contribution made by Shri Ranoj Dasgupta during his long tenure as a Director of the Company, since December 23, 2004.

On the basis of the recommendation of Nomination & Remuneration Committee, the Board of Directors appointed Ms. Anshu Roy, with effect from February 13, 2015, as an Additional Director, in the category of Independent Director of the Company. Ms. Anshu Roy holds office up to the date of the ensuing annual general meeting. The Company has received a notice from a member under Section 160 of the Companies Act, 2013, along with a requisite deposit, proposing her candidature for the office of Independent Director, to be appointed as such, at the ensuing annual general meeting. Necessary resolution is being proposed in the notice of the ensuing Annual General Meeting for appointment of Ms. Anshu Roy as an Independent Director of the Company for the approval of the Members pursuant to Section 149 of the Companies Act, 2013 for a term of 5 consecutive years from February 13, 2015 to February 12, 2020.

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association, Shri Seemanto Roy, Non-Executive, (Promoter) Director of your Company retires by rotation and is eligible for reappointment at the ensuing Annual General Meeting.

None of the Directors of the company are related to each other. Brief resume of the Directors, proposed to be appointed/ re-appointed, nature of their expertise in specific functional areas and names of other companies in which they hold Directorship alongwith their Membership/Chairmanship of Committees of the Board as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges, are provided in the annexure to the Notice of the Twenty Fourth Annual General Meeting being sent to the members along with the Annual Report.

Based on the confirmations received, none of the Directors are disqualified for being appointed/ reappointed as Directors in terms of Section 164the Companies Act, 2013.

During the year under review, no stock options were issued to the Directors of the Company.

BOARD MEETINGS

The Board met five times during the year on May 29, 2014, August 13, 2014, September 29, 2014, November 13, 2014, and February 13,2015 respectively.

KEY MANAGERIAL PERSONNEL

Shri D.J. Bagchi, CEO & Company Secretary, was also appointed as "Manager" under Section 269 of the Companies Act, 1956. The appointment of Shri D.J.Bagchi as "Manager" expired on July 30, 2015. The Board of Directors of your Company, on the recommendation of the Nomination & Remuneration Committee, thought it prudent to re-appoint Shri D.J.Bagchi, as Chief Executive Officer and Manager under Section 196, 197, 198, and as a Key Managerial Personnel under Section 203 of the Companies Act, 2013 and rules made thereunder for a further period of three years w.e.f. July 31,2015 subject to the approval of the members. Necessary resolution for the said re-appointment is being proposed in the notice of the ensuing Annual General Meeting for the approval of the members.

During the year under review, the Board of Directors appointed Shri Vivek Kapoor, who was an employee and holding the designation as Corporate Manager, (Finance & Corporate Affairs) before the commencement of the Companies Act, 2013, as the Chief Financial Officer (CFO) and a Key Managerial Personnel under Section 203 of the Companies Act, 2013.

AUDITORS

At the Twenty-third (23rd) Annual General Meeting held on September 29, 2014, the Members had appointed M/s. Chaturvedi & Co., [FRN: 302137E] Chartered Accountants as the Statutory Auditors of the Company, by way of ordinary resolution under section 139 of the Companies Act, 2013, to hold office from the conclusion of Twenty-third (23rd) Annual General Meeting until the conclusion of the Twenty-sixth (26th) Annual General Meeting of the Company, subject to ratification of the appointment by the members of the Company at every Annual General Meeting as per the provisions of the Companies Act, 2013.

Based on the recommendation of the Audit Committee, the Board of Directors at their meeting held on August 14, 2015, recommended the ratification of appointment of M/s. Chaturvedi & Co., Chartered Accountants, as the Statutory Auditors of the Company, and that, the necessary resolution in this respect is being included in the notice of the Twenty - fourth (24th) Annual General Meeting for the approval of the Members of the Company. The Company has received consent from the Statutory Auditor and confirmation to the effect that they are not disqualified to be appointed as the Statutory Auditor of the Company in terms of the provisions of Companies Act, 2013 and Rules framed thereunder.

NOTES TO ACCOUNTS AND AUDITORS REPORT

No adverse remark or observation is given by the Statutory Auditors. The observations made by the Statutory Auditors in their report, read with the relevant notes to accounts, are complete, transparent and self- explanatory and therefore do not call for any further comments by the Board.

SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Shri P.V. Subramanian, Practicing Company Secretary (CP:2077) as the Secretarial Auditor of the Company for the financial year 2014-2015. The Secretarial Audit Report for the financial year ended March 31, 2015, is annexed as "Annexure - 2" to this report.

The observation made in the said report with regard to non filing of Form MGT-14 was due to ambiguity and uncertainty of applicability of the same for the relevant period. Your Directors wish to inform you that Rule 8(5) under the Companies (Meetings of Board and its Powers) Rules, 2014 has since been omitted by the Companies (Meetings of Board and its Powers) Amendment Rules, 2015 vide Notification No. G.S.R.206 (E) dated 18.03.2015w.e.f. 18-03,2015.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors would like to inform that the audited accounts containing the Financial Statements for the year ended March 31,2015 are in conformity with the requirements of the Companies Act, 2013 and they believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company's financial condition and results of operations. These Financial Statements are audited by M/s. Chaturvedi & Co., Chartered Accountants the Statutory Auditor of the Company.

Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, it is hereby confirmed that:

a) in the preparation of the annual accounts for the year ended March 31, 2015, the applicable Accounting Standards had been followed along with proper explanation relating to material departures,

b) the directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at March 31,2015 and of the profit of the Company for that period;

c) the directors had taken proper and sufficient care 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 directors had prepared the annual financial statements on a going concern basis;

e) the directors had laid down Internal Financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DISCLOSURE UNDER SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

Your Company is not engaged in any manufacturing activity and thus its operations are not energy intensive and the particulars relating to conservation of energy and technology absorption as per Section 134(3) of the Companies Act, 2013, read with Rule 8 (3) of the Companies (Accounts) Rules, 2014, are not applicable. There has been no foreign exchange earnings and outgo during the year under review.

EMPLOYEE REMUNERATION

A. The ratio of the remuneration of each director to the median employee's remuneration and other details in terms of sub-section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are forming part of this report and is annexed as "Annexure -1" to this Report.

B. Since no employee is in receipt of remuneration in excess of the limits as laid down under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and Rule 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, no disclosures in this regard are applicable.

CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, Management Discussion and Analysis Report, and Report on Corporate Governance form part of this Annual Report. The Report on Corporate Governance also includes certain disclosures that are required, as per Companies Act, 2013.

The Auditor's certificate on Corporate Governance issued by the Statutory Auditors of the Company for the year under review, in pursuance of the Clause 49 of the Listing Agreement forms part of this Annual Report.

INTERNAL CONTROL

The Company has an adequate internal audit system in place whereby The Internal Audit is conducted by the Internal Auditor and reports are submitted on a periodic basis. The audit function maintains its independence and objectivity while carrying out its assignments. It evaluates on a continuous basis the adequacy and effectiveness of internal control mechanism, adherence to policies, procedures as well as regulatory and legal requirements. The function also recommends improvement in operational processes and suggests streamlining of controls against various risks. The Audit Committee of the Board reviews the internal audit function on a continuous basis.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS

There were no significant/material orders passed by any Regulator or Court or Tribunal which would impact the going concern status of the Company and its future operations.

CHANGE IN THE NATURE OF BUSINESS

There are no changes in the Nature of Business.

NOMINATION (INCLUDING BOARDS' DIVERSITY) REMUNERATION & EVALUATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination (including Boards' Diversity), Remuneration & Evaluation Policy, which, inter-alia, lays down the criteria for identifying the persons who are qualified to be appointed as Directors and/or Senior Management Personnel of the Company, alongwith the criteria for determination of remuneration of Directors, KMPs and other employees and their evaluation and includes other matters, as prescribed under the provisions of Section178 of Companies Act, 2013and Clause 49 of the Listing Agreement.

The details of the same are provided in Corporate Governance Report forming part of this Annual Report.

RELATED PARTY TRANSACTION POLICY

Related Party Transaction Policy, as formulated by the Company, defines the materiality of related party transactions and lays down the procedures of dealing with Related Party Transactions. The details of the same are provided in Corporate Governance Reportforming part of this Annual Report.

RELATED PARTY TRANSACTIONS

There were no materially significant related party transactions i.e. transactions of material nature, with its promoters, directors or senior management or their relatives etc. that may have potential conflict with the interest of company at large. Transactions entered with related parties as defined under the Companies Act, 2013 and Clause 49 of the Listing Agreement during the financial year 2014-15 were mainly in the ordinary course of business and on an arm's length basis.

During the year, the Company has not entered into any material contract, arrangement or transaction with related parties, as defined under Clause 49 of the Listing Agreement and Related Party Transaction Policy of the Company. The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website. None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company.

ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, an annual performance evaluation of the Board, the directors individually as well as the evaluation of the working of the Board Committees including Audit Committee, Nomination & Remuneration Committee, Risk Management Committee, Stakeholders Relationship Committee, of the Board of Directors of the Company, was carried out during the year. The details of evaluation process as carried out and the evaluation criteria have been explained in the Corporate Governance Report, forming part of this Annual Report.

INSURANCE OF COMPANY'S PROPERTY

Your Company has insured its various properties and facilities against the risk of fire, theft, etc., so that financials are not impacted in the unfortunate event of such incidents. However, your Company does not offer at present Directors' and Officers' Liability Insurance Policy.

RISK MANAGEMENT POLICY & ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Company has put in place a comprehensive Risk Management Policy which places emphasis on risk management measures to ensure an appropriate balance between risk and return. Risk management is a board-driven function with the overall responsibility of risk management assigned to the Risk Management Committee of the Board of Directors. At the operational level, risk management is assigned to the Asset Liability Management Committee ("ALCO"). Your Company conducts risk profiling on a regular basis for the purpose of self- assessment.

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has duly implemented NHB's Asset Liability Management Guidelines.

CORPORATE SOCIAL RESPONSIBILITY POLICY

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

CODES, STANDARDS AND POLICIES

'Know Your Customer & Anti-Money Laundering Measures

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place, which is strictly adhered to. The said Policy is in line with the National Housing Bank (NHB) guidelines.

The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash/suspicious transactions. The Company is committed to furnish to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions, whether or not made in cash, in terms of the said Policy.

Fair Practice Code

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

Whistle Blower Policy (Vigil Mechanism)

Your Company believes and is committed to adherence to high ethical standards and compliance with laws and regulations applicable to its business. Your Company has, pursuant to the provisions of Section 177(9) & (10) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Clause 49 of the Listing Agreement, put in place a Whistle Blower Policy which provides for a vigil mechanism that encourages and supports its Directors and employees to report to the management / Chairperson of the Audit Committee any instances of unethical behaviour, fraud etc. The said policy provides for adequate safeguards against the victimisation of the Whistle Blower availing this mechanism. The policy also provides for direct access to the Chairperson of the Audit Committee in exceptional cases.

Code of Conduct for Board of Directors and the Senior Management Personnel

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code requires the directors and employees of the Company to act honestly, ethically and with integrity and in a professional and respectful manner.

The declaration by the CEO of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance report.

Code for Prevention of Insider Trading Practices

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company. The code is applicable to the promoters, directors, senior designated employees and the said persons are restricted from dealing in the securities of the Company during the 'restricted trading periods' notified by the Company.

Other Policies as Per NHB Rules/Guidelines

Your Company has formulated policies on 'Policy on Partial / Part-Prepayment', 'Foreclosure/Pre-closure of loan prior to actual/ agreed date of closure', 'Code of Conduct for Direct Selling Agents', 'Guidelines for Recovery Agents', 'Policy on Refunds of Fees (AF/PF)', etc in order to upgrade the procedures of collecting the information from the prospective borrowers and to ensure fair practices in dealing with the borrowers.

LISTING OF SHARES OF THE COMPANY

The Equity Shares of your Company continue to remain listed (Group-B) on the BSE Ltd. The Company has paid the listing fees as payable to the BSE Ltd. for the financial year 2015-16.

TECHNOLOGY UPDATION

The excercise of capturing of live data within the in-house developed software module is in progress. As a result the dependance on custom driven reporting has increased and on its completion, it is expected to further strengthen the prevalent information sharing mechanism. Newer application software has been provided wherever deemed necessary including better data management software.

In consonance with earlier years, emphasis remained on regular updating of systems and procedures to provide adequate checks and alerts against probable frauds that may arise due to misrepresentation by applicants and even to ensure fair practice in dealing with borrowers.

DEPOSITORY SYSTEM

The Company has entered into an agreement with CDSL/ NSDL for transaction of shares in dematerialized form. As on March 31,2015, only 3.05 per cent of the Company's paid up Share Capital consisting of 2,13,591 shares were held in physical form. As per the Securities and Exchange Board of India's (SEBI) instructions, the Company's shares have to be transacted in dematerialised form and therefore, members are requested to convert their holdings to dematerialised form.

HUMAN RESOURCES AND TRAINING

Your Company has continuously been working to improve human resource competence and capabilities in the Company to deliver the desired results. The Company aims to align HR practices with business goals, motivate people for higher performance and build a competitive working environment. Rewarding high performing employees are vital to the company's success. The Board values and appreciates the contribution and commitment of the employees towards performance of your Company during the year. In pursuance of the Company's commitment to develop and retain the best available talent, the Company continued to offer in-house training programme to staff members in executive development, leadership and management skills. 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 National Housing Bank.

Employee relations remained cordial and the work atmosphere remained congenial during the year.

INSURANCE COVERAGE TO BORROWERS

Your Company in tie-up with National Insurance Company Limited offers comprehensive insurance cover product called "NATIONAL INSURANCE SAHARA HOME LOAN SURAKSHA BIMA" offering protection to the borrowers of the Company against the following risks/perils/natural calamities:

(A) Personal Accident Insurance: Death due to accident/ accidental loss of two limbs, two eyes or one limb and one eye; Permanent total disablement from injuries other than named above.

(B) Property Insurance: Fire/Storm/Earthquake/ Riot, Strike and Malicious damage/Lightning/Explosion/Implosion /Aircraft damage, Impact damage/Subsidence and Landslide including Rock Slide/Bursting or Overflowing of Water Tanks & Pipes, Missile testing operations/Leakage from Automatic Sprinkler Installations, Bush Fire/other natural calamities.

The details regarding the product (e.g. Sum insured, premium payable etc.) are explained to the borrowers during personal discussion with them at the time of credit appraisal.

GO GREEN INITIATIVES

Like previous year, the go green initiative to send annual report in electronic format to the shareholders who have registered their e-mail ID with their Depository Participant, shall be continued. The shareholders who have not yet registered their e-mail ID are requested to do so to enable the Company to effectively comply with this initiative.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014,the extract of the Annual Return as at March 31,2015, in the prescribed form MGT 9,forms part of this report and is annexed as "Annexure - 3".

ACKNOWLEDGEMENTS

The Directors thank the valued customers, shareholders for their goodwill, patronage and support.

The Directors place on record their appreciation for the advice, guidance and support given by various regulatory authorities including the NHB, RBI, SEBI, MCA, Registrar of Companies, the Stock Exchange (BSE), Depositories and all the bankers of the Company. The Directors would also like to acknowledge the role of all its stakeholders - borrowers, key partners, and lenders for their continued support to the Company. The Board would also like to express its sincere appreciation to the Company's RTA, Service Providers and Counsellors for their continued co-operation. The Directors recognize and appreciate the efforts and hard work of all the employees of the Company and their continued contribution to its progress.

For and on behalf of the Board of Directors

Kolkata (O. P. Srivastava) (Brijendra Sahay) August14,2015 Director Director

---

Mar 31, 2014

To the members of Sahara Housingfina Corporation Limited,

The Board presents its Twenty-third Annual Report and the Audited Statement of Accounts of the Company for the year ended March 31, 2014.

FINANCIAL HIGHLIGHTS (Rs)

Particulars 2013-2014 2012-2013

GROSS INCOME 21,10,85,348 21,52,22,065

Financial Cost 11,94,06,184 13,01,46,574

Overheads 5,48,76,542 5,69,93,590

Depreciation 13,18,596 16,26,426

Profit Before Tax (PBT) 3,54,84,026 2,64,55,475

Provision for Taxation

-CurrentTax 1,07,54,928 97,55,500

- Deferred Tax (17,46,134) (33,89,505)

- IncomeTaxrelatedtoearlieryears 65,434 38,640

ProfitAfterTax (PAT) 2,64,09,798 2,00,50,840

Add: Profit carried from earlieryears 10,23,54,289 8,92,37,808

Profit available for appropriations 12,87,64,087 10,92,88,648

Appropriations

Transferto Special Reserve u/s 36(1) (viii) ofthe Income Tax Act, 1961 read with Sec. 29C ofthe NHB Act, 1987 77,70,065 69,34,359

Balance carried to Balance Sheet 12,09,94,022 10,23,54,289

PERFORMANCE

Some of the key highlights of your company''s performance during

Income & Profit (PBT & PAT)

- The Profit and Loss Account shows a Profit Before Tax (PBT) of Rs. 354.84 lacs after making provisions for NPAs and Loan Assets and taking into account all expenses, including depreciation as againstthe PBT ofRs. 264.55 lacs for the previous year, representing increase of 34 per cent (approx). The provision for income tax (net of deferred tax) is Rs. 90.74 lacs and the profit after tax for the year is Rs.264.10 lacs as against Rs.200.51 lacs in the previous year, representing increaseof 32 per cent (approx). Taking into account the balance ofRs.1023.54 lacs being brought forward from the previous year, the distributable profit isRs. 1209.94

- The Gross Income for the year under review was Rs.2110.85 lacs as against the previous financial year''s incomeofRs.2152.22 lacs representing a marginal decline in grosstotal income by 1.92 per cent (approx).

Net Owned Fund (NOF) & Assets under Management (AUM)

- Shareholders'' Equity (Net Owned Fund) as at March 31,2014was Rs. 3203.12 lacsas against Rs.2939.02 lacs in the previous year, representing an increase of 8.98 per cent.

- The total Assets under Management of the Company as on March 31, 2014 was Rs. 16301.40 lacs as against Rs. 15729.89 lacs in the previous year, thereby registering a marginal increase of 3.63 per cent.

earnings Per Snare (eps)

The Earnings per share (EPS) as at March 31, 2014 was Autnorized Snare Capital

The Authorised Share Capital of the Company stands at t 50,00,00,000 (divided into 3,00,00,000 Equity shares of t10/- each and 2,00,00,000 Preference Shares of t10/- each). During the year there has been no change in the Authorised Share Capital ofthe Company.

Paid-up Snare Capital

The issued, subscribed and paid-up equityshare capital ofthe Company stands att 7,00,00,000 divided into 70,00,000 equity sharesoffacevalueof t10/- each.

Subordinated Debt

As on March 31,2014, your Company''s outstanding subordinated debt were t 25 crore. The debt is subordinated to present and future senior indebtednessofyour Company.

Capital Adequacy

As per the Housing Finance Companies (NHB) Directions, 2010, every Housing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of 12 per cent. The Capital Adequacy Ratio of SHCL as on March 31, 2014 was 48.44 per cent. The following table sets out our capital adequacy ratios as at March 31,2012, 2013 and 2014.

As at March 31st Particulars 2014 2013 2012

Capital Adequacy Ratio 48.44 50.76 30.11

LOANS PERFORMANCE

During the year under review, the Company disbursed loans aggregating tot 3893.57 lacs as against14039.49 lacs inthe previous year March 31, 2013. The outstanding loan portfolio as at March 31, 2014 stood at t 16301.40 lacs as against t 15729.89 lacs in the previousyear March 31,2013.

Tne Cumulative Log-in, Sanction and Disbursement amount as on Marcn 31,2014 are as under:

No.of Amount Particulars Accounts (Rs in lacs) 2013-14 2012-13 2013-14 2012-13

Cumulative Log-in 6037 5677 55743.83 53974.31

Cumulative Sanction 3867 3565 37528.05 36658.92

Cumulative Disbursement 3674 3359 34362.93 30469.36

The year-wise sanction and disbursement details for the previous five years are as under;

(Rs In Lacs)

Particulars 31.03.14 31.03.13 31.03.12 31.03.11 31.03.10

Sanction 869.13 4509.49 2119.48 2447.59 4600.24

Disbursement 3893.57 4039.49 1891.46 3319.06 3335.45

The Company continues to serve from four regions (Kolkata, Lucknow, Hyderabad and Mumbai) and thirteen branches (Kolkata, Asansol, Siliguri, Ranchi, Durgapur, Lucknow, Gorakhpur, Kanpur, Mumbai, Pune, Hyderabad, Vijayawada and Vsakhapatnam).

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

The Company strictly adheres 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 totime. As perthe prudential norms, the income on such NPAs is not to be recognised. The Company has made provision for contingencies on standard as well as non-performing housing loans and property loans as per the norms.

The amount of gross Non-Performing Assets (NPA) as on March 31, 2014 was t 254.59 lacs, which is equivalent to 1.56 per cent of the loan portfolio of the Company as against t 201.98 lacs, which was 1.28 per cent of the housing loan portfolio as at March 31, 2013.

CREDIT RATING

The ''Long-term Bank Facilities'' of the Company aggregating to 15000 lacs have been assigned a CARE BB (Double B Plus) rating from Credit Analysis & Research Limited (CARE Ratings). DIVIDEND

The Board of Directors felt it prudent to retain the earnings for the year under review to be ploughed back in the lending business which shall result in augmenting the Company''s growth and consequently shareholders'' wealth.

DEPOSITS

Your Company is registered as a non-deposit taking Housing Finance Company with National Housing Bank (NHB), New Delhi. The Company has neither accepted in the past nor has any future plans, by virtue of its registration, to accept any public deposits, bywhatever name called. Accordingly, the Company has not accepted / renewed any deposits during the year within the meaning of Section 58(A) of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. There are no unclaimed deposits as on March 31,2014.

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions ofthe Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time.

OTHER REGULATORY COMPLIANCE

The Company has also been following directions, guidelines, circulars issued by SEBI, Stock Exchange (BSE), MCA, from timeto time pertaining to listed companies.

DIRECTORS

Shri Sakti Prasad Ghosh, Independent & Non-executive Director, has resigned from the Board with effect from May 29,2014. The Board places on record its deep appreciation for the valuable contribution made by him during histenure as a Directorofthe Company.

In accordance with the provisions of Section 149 of the Companies Act, 2013, Members'' approval is being sought for the appointment of Shri Brijendra Sahay and Shri Ranoj Dasgupta as Independent Directors for a term of 5 consecutive years from the conclusion of Company''s 23rd Annual General Meeting to the conclusion of Company''s 28th annual General Meeting with respectto the financial years 2014-15, 2015-16, 2016-17, 2017-18 and 2018- 19. The Company has received requisite notices in writing from the members proposing the names of Shri Brijendra Sahay and Shri Ranoj Dasgupta for appointment as Independent Directors. The Company has received declarations from all the Independent Directorsofthe Company confirming thatthey meetthe criteria of independence as prescribed under section 149(6) of Companies Act, 2013 and Clause 49 of the Listing Agreement withtheStockExchanges. Necessary resolutions for the appointment/re-appointment ofthe aforesaid directors have been included in the notice ofthe ensuing Annual General Meeting.

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Shri Joy Broto Roy, (Non-executive - Non-independent) Director ofthe Company, retires by rotation at the ensuing Annual General Meeting ofthe Company and is eligible, for re-appointment.

Brief resume of the Directors proposed to be appointed/ reappointed, nature of their expertise in specific functional areas and names of companies in which they hold directorship and membership/chairmanshipof Board committees, as stipulated under Clause 49 of Listing Agreement with the Stock Exchanges in India, are provided in the annexureto the Notice ofthe Twenty- third Annual General Meeting being sentto the members along with the Annual Report. All the Directors of the Company have confirmed that they are not disqualified for being re-appointed as directors in term of sub section 2 of Section 164 the Companies Act, 2013.

AUDITORS

M/s Chaturvedi & Co., Chartered Accountants, [ICAI Firm Registration No: 302137E], Kolkata, were re-appointed as Statutory Auditors in the twenty-second Annual General Meeting of the Company and their term is scheduled to end at the conclusion ofthe ensuing Annual General Meeting and they are eligiblefor re-appointment.

Certificates have been received from them as per the provisions of Section 139 ofthe Companies Act, 2013 to the effect that their re-appointment as Auditors of the Company, if made, would be within the limits prescribed under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for reappointment as Statutory Auditorsofthe Company.

Based on the recommendation ofthe Audit Committee, the Board of Directors has recommended the appointment of M/s Chaturvedi & Company, Chartered Accountants, as the Statutory Auditors ofthe Company to hold office from the conclusion of this Annual General Meeting until the conclusion of the Twenty sixth (26th) Annual General Meeting of the Company with respect to the financial years 2014-15, 2015-16 and 2016-17, subject to ratification of the appointment by the Members ofthe Company at every Annual General Meeting as per the provisions of the Companies Act, 2013.

The Board of Directors recommend the appointment of M/s Chaturvedi & Co., Chartered Accountants, Kolkata, as the Statutory Auditors, of the Company for the financial years 2014-15, 2015-16 and 2016-17.

NOTES TO ACCOUNTS AND AUDITORS REPORT No adverse remark or observation is given by the Statutory Auditors. The observations made by the Statutory Auditors in their report, read with the relevant notes to accounts, are complete, transparent and self- explanatory and therefore do not call for any further comments by the Board.

INTERNAL CONTROL

The Company has an adequate internal audit system in place whereby internal audit is conducted by the internal auditors and reports are submitted on a periodic basis. The audit function maintains its independence and objectivity while carrying out its assignments. It evaluates on a continuous basis the adequacy and effectiveness of internal control mechanism, adherence to policies, procedures as well as regulatory and legal requirements. The function also recommends improvement in operational processes and suggests streamlining of controls against various risks. The Audit Committee of the Board reviews the internal auditfunction on a continuous basis.

INSURANCE OF COMPANY''S PROPERTY Your Company has insured its various properties and facilities against the risk of fire, theft, etc., so that financials are not impacted in the unfortunate eventof such incidents.

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has also implemented NHB''s Asset Liability Management Guidelines.

CODES, STANDARDS AND POLICIES

''Know Your Customer & Anti-Money Laundering Measures

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC &AML Policy) in place and the Company adheres to the said Policy. The said Policy is in line with the National Housing Bankguidelines.

The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company is committed to furnish to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the valueof more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions, whetheror not made in cash, intermsofthesaid Policy.

Fair Practice Code

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

Whistle Blower Policy

Your Company believes and is committed to adherence to high ethical standards and compliance with laws and regulations applicable to its business. During the year, your Company adopted a Whistle Blower Policy which provides for a vigil mechanism that encourages and supports its Directors and employees to report to the management / Chairperson of the Audit Committee any instances of unethical behaviour, actual orsuspected, fraud etc. The said policy, however, provides for adequate safeguards against the victimisation of the Whistle Blowerwho avail this mechanism. The policy also providesfor direct access to the Chairperson of the Audit Committee in exceptional cases.

Code of Conduct for Board Members and the Senior Management

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code requires the directors and employees of the Company to act honestly, ethically and with integrity and in a professional and respectful

The declaration by the CEO of the Company regarding compliancewith the Codeof Conductfor Board Members and Senior Management is annexed with the Corporate Governance

Code for Prevention of InsiderTrading Practices

Your Company has formulated and adopted a Code for Prevention ofInsider Trading Practices in accordance with the model codeof conduct as prescribed under the SEBI (Prohibition of InsiderTrading) Regulations, 1992, as amended. The code lays down guidelines, which includes procedures to be followed and disclosuresto be madewhile dealing in theshares of the Company. The code is applicable to the promoters, directors, senior designated employees and the said persons are restricted from dealing in the securities of the Company during the ''restricted trading periods'' notified by the Company.

LISTING OF SHARES OF THE COMPANY

The Equity Shares ofyour Company continue to remain listed (Group-B) on the BSE Ltd. The Company has paid the listing fees as payabletothe BSE Ltd. forthefinancial year2014-15.

TECHNOLOGY UPDATION

Partial commissioning of theoperatinonal module was achieved on the later part of the financial year, thereby increasing the depenendence on technology and strengthening the reprorting system generated through operational module.

Alike earlieryears, emphasis remained on regular updation of systems and procedures to provide adequate checks and alerts against probable frauds that may arise due to misrepresentation by applicants and even to ensure fair practice in dealing with borrowers.

STATUTORY INFORMATION

Particulars regarding conservation of energy, technology absorption, and foreign exchange earnings and outgo

The Companydoes notown any manufacturing facility. Hence the particulars relating to conservation of energy and technology

absorption as per section 217(1)(e)ofthe Companies Act,1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable. There has been no foreign exchange earning and outgo during the

Particulars of Employees

Since no employee is in receipt of remuneration in excess of the limits as laid down under Section 217 (2A)ofthe Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 as amended to date, no disclosures inthis regard are applicable.

STEPS TAKEN TO COMPLY WITH THE PROVISIONS OF THE COMPANIES ACT, 2013

i. Appointment of Chief Financial Officer (CFO)/Key Managerial Person u/s 203(1)

The Board of Directors of the Company has appointed Shri Vivek Kapoor, (who has been in the employment of the Company w.e.f. 12.08.2003) as the Chief Financial officer as defined in Section 2(19) of the Companies Act, 2013.

ii. Appointment of Secretarial Auditor under u/s 204

The Board of Directors of the Company has appointed Shri P.V.Subramanian, Practicing Company Secretary (CP: 2077) as the Secretarial Auditor of the Company for the financial year 2014-2015. The reportofthe Secretarial Auditor for the financial year 2014-2015 as submitted, shall form partof the Board''s Report in terms of Section 204(1) of the Companies Act, 2013.

DEPOSITORY SYSTEM

The Company has entered into an agreement with CDSL/ NSDL for transaction of shares in dematerialized form. As on March 31, 2014, only 3.05 per cent of the Company''s paid up Share Capital consisting of 2,13,105 shares were held in physical form. As per the Securities and Exchange Board of India''s (SEBI) instructions, the Company''s shares have to be transacted in dematerialised form and, therefore, members are requested to converttheir holdings to dematerialised form.

HUMAN RESOURCES AND TRAINING Your Company has continuously been working to improve human resource competence and capabilities in the Company to deliver the desired results. The Company aims to align HR practices with business goals, motivate people for higher performance and build a competitive working environment. Rewarding high

performing employees are vital to the company''s success. The Board values and appreciates the contribution and commitment ofthe employeestowards performance ofyour Companyduring the year. In pursuance ofthe Company''s commitment to develop and retain the best available talent, the Company continued to offer in-house training programme to staff members in executive development, leadership and managementskills. The Company alsosponsored its employees at various levelsto attend various seminars and programmes conducted by various organizations and institutions including training programmes conducted by National Housing Bank.

Employee relations remained cordial and the work atmosphere remained congenial during theyear.

DIRECTORS'' RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 217 (2AA) of the Companies Act, 1956 and based on the information provided by the management, your Directors state that:

- In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and that there are no material departures.

- In the selection of the Accounting Policies, consultation with the Statutory Auditors have been made and have applied them consistently, madejudgements and estimates that are reasonable and prudentso as togive a true and fairviewof the State of Affairs of the company as at March 31,2014 and ofthe Profitof the company for year ended on date.

- Proper and sufficient care has been taken to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions ofthe Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

- The Annual Accounts have been prepared on a Going Concern

INSURANCE COVERAGE TO BORROWERS

Your Company in tie-up with National Insurance Company Limited offers comprehensive insurance cover product called "NATIONAL INSURANCE SAHARA HOME LOAN SURAKSHABIMA" affording protection to the borrowers of the Company against the following risks/perils/natural calamities:

(A) Personal Accident Insurance: Death due to accident/accidental loss oftwo limbs, two eyesorone limb and one eye: Permanent total disablement from injuries other than named above.

(B) Property Insurance: Fire/Storm/Earthquake/Riot, Strike and Malicious damage/Lightning/Explosion/Implosion/Aircraft damage,

Impact damage/Subsidence and Landslide including Rock Slide/Bursting or Overflowing of Water Tanks & Pipes, Missile testing operations/Leakage from Automatic Sprinkler Installations, Bush Fire/other natural calamities.

The details regarding the product (e.g. Sum insured, premium payable etc.) are explained to the borrowers during personal discussion with them atthe timeof credit appraisal. CORPORATE GOVERNANCE

The Auditor''s certificate on Corporate Governance issued by the Statutory Auditors of the Company for the year under review, in pursuance of the Clause 49 of the Listing Agreement is annexed to the report of the Directors on Corporate Governance.

Your Company has been complying with the principles of good corporate governance over the years. The Board of Directors support the broad principles of Corporate Governance. In addition to basis governing issues, the Board lays emphasis on transparency, accountability and integrity.

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis Report, Corporate Governance Report and CEO''s declaration regarding compliance of Code of Conduct by Board Members and Senior Management personnel form part of this Annual Report.

GO GREEN INITIATIVES

Like previous year, the gogreen initiativetosend annual report in electronic format to the shareholders who have registered their e-mail ID with their Depository Participant, shall be continued. The shareholders who have not yet registered their e-mail ID

are requested to do so to enable the Company to effectively comply with this initiative.

ACKNOWLEDGEMENTS

The Directors thank the valued customers, shareholders for their goodwill, patronage and support.

The Directors placeon record their appreciation forthe advice, guidance and support given by various regulatory authorities including the NHB, RBI, SEBI, MCA, Registrar of Companies, the Stock Exchange (BSE), Depositories and all the bankers of the Company. The Directors would also like to acknowledge the role of all its stakeholders - borrowers, key partners, and lenders for their continuing support to the Company. The Board would also like to express its sincere appreciation to the Company''s RTA, Service Providers and Counsellors for their continued co-operation. The Directors recognize and appreciate the efforts and hard work of all the employees of the Company and their continued contribution to its progress.

For and on behalf of the Board of Directors

Kolkata (O. P. Srivastava) (Brijendra Sahay) August 13,2014 Director Director

---

Mar 31, 2012

To the members of Sahara Housingfina Corporation Limited,

The Board presents its Twenty- First Annual Report and the Audited Statement of Accounts of the Company for the year ended March 31, 2012.

FINANCIAL RESULTS (Rs)

Particulars 2011-2012 2010-2011

GROSS INCOME 20,17,50,791 20,38,65,671

Less:

Interest 12,80,56,455 13,32,76,648

Overheads 4,22,49,010 3,82,05,487

Depreciation 15,19,602 14,76,785

Profit Before Tax (PBT) 2,99,25,724 3,09,06,751

Provision for Taxation

- Current Tax 81,55,376 89,42,712

- Deferred Tax (4,25,661) (8,67,948)

- Income Tax related to earlier years 23,737 1,92,224

Profit After Tax (PAT) 2,21,72,271 2,26,39,763

Add: Profit carried from earlier years 7,32,25,340 5,72,30,090

Profit available for appropriations 9,53,97,611 7,98,69,853

Appropriations

Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act, 1961 61,59,803 66,44,513

Balance carried to Balance Sheet 8,92,37,808 7,32,25,340

PERFORMANCE

Some of the key highlights of your company's performance during the year under review;

Income & Profit (PBT & PAT)

- The Profit and Loss Account shows a profit before tax of Rs. 299.26 lacs after making provisions for NPAs and Loan Assets (General) and taking into account all expenses, including depreciation as against the profit before tax of Rs. 309.07 lacs for the previous year. The provision for income tax (net of deferred tax) is Rs. 77.53 lacs and the profit after tax for the year is Rs. 221.72 lacs as against Rs. 226.40 lacs in the previous year. Taking into account the balance of Rs. 732. 25 lacs being brought forward from the previous year, the distributable profit is Rs. 953.98 lacs.

- The Gross Income for the year under review declined marginally by 1.04 per cent to Rs. 2017.51 lacs in comparison to last financial year's income of Rs. 2038.66 lacs.

Net Owned Fund (NOF) & Assets under Management (AUM)

- Shareholders' Equity (Net Owned Fund) increased to Rs. 2738.51 lacs from Rs. 2516.79 lacs in the previous year, an increase of 8.81per cent (approx).

- The total Assets Under Management of the Company as on March 31, 2012 is Rs. 14612.13 lacs as against Rs. 15214.58 lacs in the previous year, thereby registering a marginal decline of 3.96 per cent (approx).

Earnings Per Share (EPS)

The Earnings Per Share (EPS) is Rs. 3.17 as at March 31, 2012 as against Rs. 3.23 as at March 31, 2011.

Lending Operations

The main thrust continues on individual housing loans. Housing loan to individuals i.e. retail loans constitute 100% of the outstanding loan portfolio as at March 31, 2012. During the year under review, your Company disbursed loans aggregating to Rs. 1891.46 lacs (Previous year Rs. 3319.06 lacs). The outstanding loan portfolio as at March 31, 2012 stood at Rs. 14612.13 lacs (Previous Year 15214.58 lacs).

The Cumulative Log-in, Sanction and Disbursement amount as on March 31, 2012 are as under:

No. of Amount Particulars Accounts (Rs. in Lacs)

2011-12 2010-11 2011-12 2010-11

Cumulative Log-in 5272 5062 48568.19 45968.66

Cumulative Sanction 3241 3063 32266.95 30029.95

Cumulative Disbursement 3046 2888 26429.87 24538.41

The Company continued to operate from four regions (Kolkata, Lucknow, Hyderabad and Mumbai) and thirteen branches (Kolkata, Asansol, Siliguri, Ranchi, Durgapur, Lucknow, Gorakhpur, Kanpur, Mumbai, Pune, Hyderabad, Vijayawada and Visakhapatnam) and is serving the customers through its attractive and competitive home loan schemes.

The performance of your Company, financial as well as operational, witnessed a marginal decline mainly due to insufficiency of funds coupled with vagaries of business environment including stiff competition from peers and banks, reduction in margins, increase in operating expenses, rise in loan foreclosures/Pre-payments including abolishment of foreclosure/pre-payment charges etc.

RESOURCE MOBILISATION THROUGH SUBORDINATED DEBT

The Board of Directors on May 30, 2012 approved the issue of 10% Unsecured, Redeemable, Non-convertible Debentures (NCDs) classified as "Subordinated Debt" (Tier II Capital) under Section 2(zd) of sub-rule (1) of Rule 2 of Chapter - I of the Housing Finance Companies (NHB) Directions, 2010. At the subsequent meeting held on July 25, 2012, the Board issued and allotted on Private Placement basis 2500, 10% NCDs at face value of Rs. 1 lac each as "Subordinated Debt" redeemable at the expiry of 84 months from the date of issue, aggregating Rs. 2500 lacs. The infusion is expected to ease the long standing problem of paucity of funds to generate new business.

CREDIT RATING

Your Company has been assigned a CARE BB (Double B Plus) rating from Credit Analysis and Research Limited (CARE Ratings) in July, 2012 for its 'Long-term Bank Facilities' aggregating to Rs. 5000 lacs.

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.

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.

NON-PERFORMING ASSETS AND PROVISIONS

The amount of gross Non- Performing Assets (NPA) as on March 31, 2012 was Rs. 249.62 lacs, which is equivalent to 1.71 per cent of the loan portfolio of the Company as against Rs. 273.71 lacs i.e.1.80 per cent of the housing loan portfolio as at March 31, 2011. Your Company continued its strict adherence 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. The Company has made adequate provision for the assets on which instalments are overdue for more than 90 days and on other assets, as required.

REGULATORY GUIDELINES/AMENDMENTS

The Company has been following guidelines, circulars and directions issued by National Housing Bank (NHB) from time to time.

As per the Housing Finance Companies (NHB) Directions, 2010 dated June 10, 2010, every Housing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of 12 per cent. The Capital Adequacy Ratio of SHCL as on March 31, 2012 was 30.11 per cent.

During the year NHB advised HFCs not to charge prepayment levy or penalty on pre-closure of housing loans subject to satisfaction of certain conditions. Your Company has immediately taken steps to comply with the circular.

Besides above, your Company has continued to comply with the guidelines in respect of Income Recognition, Asset Classification, Provisioning for Non-Performing Assets, maintaining Capital Adequacy Ratio etc. issued by NHB from time to time.

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

DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Shri Brijendra Sahay and Shri Ranoj Dasgupta, Directors of the Company, retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, offer themselves for re-appointment.

The details pertaining to these Directors seeking appointment/re-appointment are furnished in the section 'Directors' Profile' published elsewhere in this Annual Report and the notice of the ensuing AGM also contains the disclosures pertaining to these Directors as required under Clause 49 of the Listing Agreement. None of the aforesaid Directors of the Company are disqualified for being appointed/re-appointed as Directors pursuant to Section 274 (1) (g) of the Companies Act, 1956.

INTERNAL CONTROL

The Company has internal audit system whereby internal audit is conducted by the internal auditors and reports are submitted on a periodic basis. The exercise is further complemented by an in-house team (Conformity Assessment Team) to ensure the understanding and compliance of various policies & procedures at all levels and to assure the management that the plans and policies framed by it have actually been implemented.

Your Company has framed policies on 'Know Your Customer & Anti-Money Laundering Standards' (amended on November 10, 2010), 'Fair Practice Code' (as amended on May 30, 2011), 'Policy on Partial/Part-Prepayment', 'Foreclosure/Pre-closure of loan prior to actual/agreed date of closure' (amended on July 25, 2012), 'Code of Conduct for Direct Selling Agents' (framed on July 31, 2008), 'Guidelines for Recovery Agents' (framed on July 31, 2008) etc. in order to upgrade the procedures of collecting the information from the prospective borrowers and to ensure fair practices in dealing with the borrowers.

TECHNOLOGY UPDATION

During the later part of the financial year 2011-12 the work on commissioning the "Operational Module" of the in-house developed software was commenced. The trial run is expected during the ongoing financial year. Newer application software was implemented for improved information flow.

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.

AUDITORS

Pursuant to the recommendations of the Audit Committee at its meeting held on May 30, 2012, the Board of Directors of the Company has approved, subject to the approval of the Members at the ensuing Annual General Meeting, the appointment of M/s Chaturvedi & Co., (Firm Registration No. 302137E) Chartered Accountants, Kolkata, as the Statutory Auditors, of the Company for the financial year 2012-13.

In terms of the provisions of Section 224 of the Companies Act, 1956 ("the said Act") M/s Chaturvedi & Co. retire at this Annual General Meeting and being eligible, offer themselves for re-appointment. In terms of the provisions of Section 224 (1B) of the said Act, M/s Chaturvedi & Co. has furnished a certificate that their appointment, if made will be within the limits prescribed under Section 224(1B) of the said Act.

The Board of Directors recommends the appointment of M/s Chaturvedi & Co., Chartered Accountants, Kolkata, as the Statutory Auditors, of the Company for the financial year 2012-13.

AUDITORS' OBSERVATIONS

No adverse remark or observation is given by the Statutory Auditors. The observations made by the Statutory Auditors in their report, read with the relevant notes to accounts, are self- explanatory.

STATUTORY INFORMATION

The Company does not own any manufacturing facility. Hence the particulars relating to conservation of energy and technology absorption as per section 217(1)(e) of the Companies Act,1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable. There has been no foreign exchange earning and outgo during the year under review.

Since no employee is in receipt of remuneration in excess of the limits as laid down under Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 as amended by the Companies (Particulars of Employees) Amendment Rules, 2011, no disclosures in this regard are applicable.

None of the Directors of the company is disqualified to be appointed as Director under the provisions of Section 274(1)(g) of the Companies Act, 1956. The Directors have made necessary disclosures, as required under various provisions of the Act and Clause 49 of the Listing Agreement with the Stock Exchange/s.

DEPOSITORY SYSTEM

The Company has entered into an agreement with CDSL/NSDL for transaction of shares in dematerialized form. As on March 31, 2012, only 3.08 per cent of the Company's Paid up Share Capital consisting of 2,15,785 shares were held in physical form. As per the Securities and Exchange Board of India's (SEBI) instructions, the Company's shares have to be transacted in dematerialised form and therefore, members are requested to convert their holdings to dematerialised form.

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 Board values and appreciates the contribution and commitment of the employees towards performance of your Company during the year. In pursuance of the Company's commitment to develop and retain the best available talent, the Company continued to offer in- house training programme to staff members in executive development, leadership and management skills. 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.

Employee relations remained cordial and the work atmosphere remained congenial during the year.

DIRECTORS' RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 217 (2AA) of the Companies Act, 1956 and based on the information provided by the management, your Directors state that:

- In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and that there are no material departures.

- In the selection of the Accounting Policies, consultation with the Statutory Auditors have been made and have applied them consistently, made judgements and estimates that are 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 of the company for that period.

- Proper and sufficient care has been taken to the best of their knowledge and ability 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.

- The Annual Accounts have been prepared on a Going Concern Basis.

INSURANCE COVERAGE TO BORROWERS

Your Company continues its arrangement with National Insurance Company Limited to offer comprehensive insurance cover product called "NATIONAL INSURANCE SAHARA HOME LOAN SURAKSHA BIMA" which affords protection to the borrowers of the Company against the following risks/perils/natural calamities:

(A) PERSONAL ACCIDENT INSURANCE: Death due to accident/Accidental loss of two limbs, two eyes or one limb and one eye; Permanent total disablement from injuries other than specified herein.

(B) PROPERTY INSURANCE: Fire/Storm/Earthquake/Riot, Strike and Malicious damage/Lightning/Explosion/Implosion /Aircraft damage, Impact damage/Subsidence and Landslide including Rock Slide/Bursting or Overflowing of Water Tanks & Pipes, Missile testing operations/Leakage from Automatic Sprinkler Installations, Bush Fire/other natural calamities.

The details regarding the product (e.g. Sum insured, premium payable etc.) are explained to the borrowers during personal discussion with them at the time of credit appraisal.

CORPORATE GOVERNANCE

A certificate from the Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges is attached to the Corporate Governance Report.

Your Company has been complying with the principles of good corporate governance over the years. The Board of Directors support the broad principles of Corporate Governance. In addition to basis governing issues, the Board lays emphasis on transparency, accountability and integrity.

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis Report and Corporate Governance Report form part of this Annual Report.

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, Registrar of Companies, the Stock Exchange (BSE), Depositories 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 Directors

(O. P. Srivastava) Director

(S. P. Ghosh) Director

Kolkata July 25, 2012

---

Mar 31, 2011

To the members of Sahara Housingfina Corporation Limited,

The Directors have great pleasure in presenting the Twentieth Annual Report on the business and operations of your Company together with the Audited Accounts for the year ended March 31, 2011.

FINANCIAL PERFORMANCE

Some of the key highlights of your company's performance - The Profit After Tax (PAT) is Rs. 226.40 lacs as against during the year under review are; Rs. 222.48 lacs in the previous year, representing a marginal increase.

- The Profit and Loss Account shows a profit before tax of

Rs. 309.07 lacs after making provisions for NPAs and Loan - The total Assets Under Management of the Company

Assets (General) of Rs.19.42 lacs and taking into account all as on March 31, 2011 is Rs. 15214.57 lacs as against expenses, including depreciation.

The provision for income Rs. 14181.18 lacs in the previous year, an increase of tax (net of deferred tax) is Rs. 82.67 lacs and the profit after 7.29 percent (approx).

Tax for the year is Rs. 226.40 lacs. Taking into account the

- Shareholders' Equity (Net Owned Fund) increased to balance of Rs. 572.30 lacs being brought forward from the Rs. 2516.79 lacs from Rs. 2290.39 lacs in the previous year, previous year, the distributable profit is Rs. 798.70 lacs. an increase of 9.88 percent (approx).

- The Gross Income for the year under review increased by

The Earnings per share (EPS) is Rs. 3.23 as at March 15.65 percent to Rs. 2038.65 lacs in comparison to last financial 31, 2011 as against Rs. 3.18 as at March 31, 2010. year's income of Rs. 1762.76 lacs.

FINANCIAL RESULTS

Particulars 2010-2011 2009-2010

GROSS INCOME 203,865, 671 176,276,254

Less:

Interest 133,276,648 111,124,220

Overheads 38,205,487 33,029,621

Depreciation 1,476,785 1,435,746

Profit Before Tax (PBT) 30,906,751 30,686,667

Provision for Taxation

– Current Tax 8,942,712 85,91,127

– Deferred Tax (867,948) (297,028)

– Income Tax related to earlier years 192,224 144,578

Profit After Tax (PAT) 22,639,763 22,247,989

Add: Profit carried from earlier years 57,230,090 41,286,222

Profit available for appropriations 79,869,853 63,534,211

Appropriations

Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act, 1961 6,644,513 6,304,121

Balance carried to Balance Sheet 73,225,340 57,230,090

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.

DEPOSITS

The Company has been granted registration by the National Housing Bank, New Delhi as a non-deposit taking Housing Finance Company.

OPERATIONAL RESULTS & NETWORK

During the year under review, your Company disbursed loans aggregating to Rs. 33.19 Cr. (Previous year Rs. 33.35 Cr.). The outstanding loan portfolio as at March 31, 2011 stood at Rs. 152.15 Cr. (Previous Year Rs. 141.81 Cr.).

The Cumulative Log-in, Sanction and Disbursement amount as on March 31, 2011 are as under:

No. of Amount

Particulars Accounts (Rs. in Cr.)

2010-11 2009-10 2010-11 2009-10

Cumulative

Log-in 5062 4771 459.69 430.20

Cumulative

Sanction 3063 2810 300.30 275.82

Cumulative

Disbursement 2888 2595 245.38 212.19

The Company operates from four regions (Kolkata, Lucknow, Hyderabad and Mumbai) and thirteen branches (Kolkata, Asansol, Siliguri, Ranchi, Durgapur, Lucknow, Gorakhpur, Kanpur, Mumbai, Pune, Hyderabad, Vijayawada and Visakhapatnam) and is serving the customers through its attractive and competitive home loan schemes.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

Your Company scrupulously adhered to the prudential guidelines for Non-Performing Assets (NPAs), issued by the National Housing Bank (NHB) under its revised Directions of 2010, as amended from time to time. Your Company has made adequate provision for the assets on which instalments are overdue for more than 90 days and on other assets, as required.

REGULATORY COMPLIANCE

The Company has been following guidelines, circulars and directions issued by the National Housing Bank (NHB) from time to time.

As per the Housing Finance Companies (NHB) Directions, 2010 dated June 10, 2010, every Housing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of

12 percent. The Capital Adequacy Ratio of SHCL as on March 31, 2011 was 27 percent. During the year, NHB stipulated that the loan to value ratio (LTV) for individual housing loans up to Rs. 20 lakhs should not exceed 90 percent and for loans above Rs. 20 lakhs, the LTV should not exceed 80 percent. Your Company has scrupulously complied with the amended guidelines.

Your Company has been complying with the guidelines in respect of Income Recognition, Asset classification, Provisioning for Non-Performing Assets, maintaining Capital Adequacy Ratio etc. issued by the NHB from time to time.

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

DIRECTORS

Shri Subrata Roy Sahara and Shri Malka Komaraiah, Directors, have resigned from the Board with effect from June 17, 2011 and February 7, 2011 respectively. The Board places on record its deep appreciation for the valuable contribution made by them during their tenure as Directors of the Company.

Shri Seemanto Roy was inducted as an Additional Director (Non-executive) w.e.f July 8, 2011 under Section 260 of the Companies Act, 1956. He shall hold office upto the date of the ensuing AGM of the Company and, being eligible, offers himself for appointment. The Board firmly believes that his association shall be highly rewarding to the Company.

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Shri Om Prakash Srivastava and Shri Joy Broto Roy, Directors of the Company, retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, offer themselves for re-appointment.

The details pertaining to these Directors seeking appointment / re-appointment are furnished in the section ‘Directors' Profile' published elsewhere in this Annual Report and the notice of the ensuing AGM also contains the disclosures pertaining to these Directors as required under Clause 49 of the Listing Agreement. None of the aforesaid Directors of the Company are disqualified for being appointed / re-appointed as Directors pursuant to Section 274 (1) (g) of the Companies Act, 1956.

INTERNAL CONTROL

As per the NHB Directions, your Company has framed policies on ‘Know Your Customer & Anti-Money Laundering Standards (amended on November 10, 2010)', ‘Fair Practice Code' (as amended on May 30, 2011) etc. in order to upgrade the procedures of collecting the information from the prospective borrowers and to ensure fair practices in dealing with the borrowers.

The Company has internal audit system whereby internal audit is conducted by the internal auditors and reports are submitted

on a periodic basis. Besides, the Company has established a team inhouse (Conformity Accessment Team) for assessing that various policies and procedures being implemented from time to time are being understood and complied at all the levels. The report of such assessment is placed before the Board periodically.

TECHNOLOGY UPDATION

During the financial year 2010-11, your Company further strengthened its IT infrastructure and systems to support its operations. New application software was implemented to provide improved information flow to branches and to further support the collection system.

AUDITORS

Pursuant to the recommendations of the Audit Committee at its meeting held on August 11, 2011 the Board of Directors of the Company has approved, subject to the approval of the Members at the ensuing Annual General Meeting, the appointment of M/s Chaturvedi & Co., (Firm Registration No.302137E) Chartered Accountants, Kolkata, as the Statutory Auditors, of the Company for the financial year 2011-12.

In terms of the provisions of Section 224 of the Companies Act, 1956 ("the said Act") M/s Chaturvedi & Co. retire at this Annual General Meeting and being eligible, offer themselves for re-appointment. In terms of the provisions of Section 224 (1B) of the said Act, M/s Chaturvedi & Co. has furnished a certificate that their appointment, if made will be within the limits prescribed under Section 224 (1B) of the said Act.

The Board of Directors recommends the appointment of M/s Chaturvedi & Co., Chartered Accountants, Kolkata, as the Statutory Auditors, of the Company for the financial year 2011-12.

AUDITORS' OBSERVATIONS

The observations made by the Statutory Auditors in their report, read with the relevant notes to accounts, are self- explanatory. No adverse remark or observation is given by the Statutory Auditors.

PARTICULARS OF EMPLOYEES

Since no employee is in receipt of remuneration in excess of the limits as laid down under Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 as amended by the Companies (Particulars of Employees) Amendment Rules, 2011, no disclosures in this regard are applicable.

STATUTORY INFORMATION

The Company does not own any manufacturing facility. Hence the particulars relating to conservation of energy and technology absorption as per section 217(1)(e) of the Companies Act,1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable.

There has been no foreign exchange earning and outgo during the year under review.

DEPOSITORY SYSTEM

The Company has entered into an agreement with CDSL / NSDL for transaction of shares in dematerialized form. As on March 31, 2011, only 3.15 percent of the Company's paid up Share Capital consisting of 2,20,261 shares were held in physical form. As per the Securities and Exchange Board of India's (SEBI) instructions, the Company's shares have to be transacted in dematerialised form and therefore, members are requested to convert their holdings to dematerialised form.

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 Board values and appreciates the contribution and commitment of the employees towards performance of your Company during the year. In pursuance of the Company's commitment to develop and retain the best available talent, the Company continued to offer in- house training programme to staff members in executive development, leadership and management skills. 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.

Employee relations remained cordial and the work atmosphere remained congenial during the year.

DIRECTORS' RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 217 (2AA) of the Companies Act, 1956 and based on the information provided by the management, your Directors state that:

- In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and that there are no material departures.

- In the selection of the Accounting Policies, consultation with the Statutory Auditors have been made and have applied them consistently, made judgements and estimates that are 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 of the company for that period.

- Proper and sufficient care has been taken to the best of their knowledge and ability 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.

- the Annual Accounts have been prepared on a Going Concern Basis.

INSURANCE COVERAGE TO BORROWERS

Your Company in tie-up with National Insurance Company Limited offers comprehensive insurance cover product called

"NATIONAL INSURANCE SAHARA HOME LOAN SURAKSHA BIMA" which provides protection to the borrowers of the Company against the following risks/perils/natural calamities:

(a) PERSONAL ACCIDENT INSURANCE:

* Death due to accident;

* Accidental loss of two limbs, two eyes or one limb and one eye;

* Permanent total disablement from injuries other than named above.

(b) PROPERTY INSURANCE:

* Fire

* Storm

* Earthquake

* Riot, Strike and Malicious damage

* Lightning

* Explosion/Implosion

* Aircraft damage, Impact damage

* Subsidence and Landslide including Rock Slide

* Bursting or Overflowing of Water Tanks & Pipes, Missile testing operations

* Leakage from Automatic Sprinkler Installations, Bush Fire.

* Other natural calamities.

The details regarding the product (e.g. Sum insured, premium payable etc.) are explained to the borrowers during personal discussion with them at the time of credit appraisal.

CORPORATE GOVERNANCE

A certificate from the Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges is attached to the Corporate Governance Report.

Your Company has been complying with the principles of good

corporate governance over the years. The Board of Directors support the broad principles of Corporate Governance. In addition to basic governing issues, the Board lays emphasis on transparency, accountability and integrity.

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis Report and Corporate Governance Report form part of this Annual Report.

STATUTORY DISCLOSURES

None of the Directors of the company is disqualified to be appointed as Director under the provisions of Section 274(1)(g) of the Companies Act, 1956. The Directors have made necessary disclosures, as required under various provisions of the Act and Clause 49 of the Listing Agreement with the Stock Exchange/s.

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, Registrar of Companies, the Stock Exchange (BSE), Depositories 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 value the professionalism of all employees of the Company who have relentlessly worked in a challenging environment and whose efforts have stood the Company in good stead.

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 Directors

(O. P. Srivastava)

Director

Lucknow (S. P. Ghosh)

August 11, 2011 Director

---

Mar 31, 2010

The Directors are pleased to present the Nineteenth Annual Report on the business and operations of your Company together with the Audited Statement of Accounts for the year ended March 31, 2010.

FINANCIAL RESULTS

(Rs.)

Particulars 2009-2010 2008-2009

Gross Income 176,276,254 179,436,345

Less:

Interest 111,124,220 123,283,423

Overheads 33,029,621 30,662,951

Depreciation 1,435,746 1,192,778

Profit Before Tax (PBT) 30,686,667 24,297,193

Provision for Taxation

-Current Tax 8,591,127 7,269,179

- Deferred Tax (297,028) (669,440)

- Income Tax related to earlier years 144,578 (57,710)

- Fringe Benefit Tax - 198,964

Profit After Tax (PAT) 22,247,989 17,556,200

Add: Profit carried from earlier years 41,286,222 28,583,306

Profit available for appropriations 63,534,211 46,139,506

Appropriations

Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act,1961 6,304,121 4,853,284

Balance carried to Balance Sheet 57,230,090 41,286,222



FINANCIAL PERFORMANCE

Some of the key highlights of your companys performance during the year under review are;

- The Profit Before Tax (PBT) is Rs. 306.87 lacs as against Rs. 242.97 lacs in the previous year, representing an increase of 26.30 % (approx).

- The Profit After Tax (PAT) is Rs. 222.48 lacs as against ? 175.56 lacs in the previous year, representing an increase of 26.73 % (approx).

- The total Assets Under Management of the Company as on March 31, 2010 is ? 14181.18 lacs as against Rs. 12946.73 lacs in the previous year, an increase of 10% (approx).

- Shareholders Equity (Net Owned Fund) increased to Rs. 2290.39 lacs from Rs. 2067. 91 lacs in the previous year, an increase of 11% (approx).

- The Earnings Per Share (EPS) is Rs. 3.18 as at March 31, 2010 as against Rs 2.51 as at March 31, 2009.

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 Companys growth and shareholders wealth.

DEPOSITS

The Company has been granted registration by the National Housing Bank (NHB), as a Non-Deposit taking Housing Finance Company (HFC).

FUND RAISING

TERM LOANS

During the year under review the Company was sanctioned a term loan of Rs. 32 Crore from The Bank of Rajasthan Limited

out of which Rs. 16 Crore was disbursed in March, 2010 and the balance of Rs 16 Crore was disbursed in April, 2010 taking the total term loan outstanding as on March 31, 2010 to Rs 49.72 Crore. The new term loan is secured by a charge in favour of the bank by way of first charge on all the book debts, outstanding receivable etc., both present and future. The loan is repayable in 28 equated quarterly installments.

OPERATIONAL RESULTS & NETWORK

During the year under review, your Company disbursed loans aggregating to Rs 33.35 Cr. (previous year Rs. 31.03 Cr). The outstanding loan portfolio as at March 31, 2010 stood at Rs 141.81 Cr. (Previous Year Rs. 129.47 Cr.).

The Cumulative Log-in, Sanction and Disbursement amount as on March 31, 2010 are as under:

Particulars No. of Amount Accounts (Rs in Cr.)

Cumulative Log-in 4771 430.20

Cumulative Sanction 2810 275.82

Cumulative Disbursement 2595 212.19



The Company operates from four regions (Kolkata, Lucknow, Hyderabad and Mumbai) and thirteen branches (Kolkata, Asansol, Siliguri, Ranchi, Durgapur, Lucknow, Gorakhpur, Kanpur, Mumbai, Pune, Hyderabad, Vijayawada and Visakhapatnam) and is serving the customers through its attractive and competitive home loan schemes.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

Your Company has diligently adhered to the prudential guidelines for Non-Performing Assets (NPAs), issued by the National Housing Bank (NHB) under its Directions of 2001, as amended from time to time. Your Company has made adequate provision for the assets on which instalments are overdue for more than 90 days and on other assets, as required.

REGULATORY COMPLIANCE

The Company has been following guidelines, circulars and directions issued by the National Housing Bank (NHB) from time to time.

As per the Housing Finance Companies (NHB) Directions, 2001 dated December 27, 2002, every Housing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of 12%. The Capital Adequacy Ratio of SHCL as on March 31, 2010 was 24.59 %.

Your Company has been complying with the guidelines in respect of Income Recognition, Provisioning for Non-Performing Assets, maintaining Capital Adequacy Ratio etc. issued by the NHB from time to time.

The Company has also been adhering to directions, guidelines,

circulars issued by SEBI/Stock Exchanges(s) from time to time pertaining to listed companies.

DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Shri Subrata Roy Sahara and Shri Sakti Prasad Ghosh, Directors of the Company, retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, offer themselves for re-appointment.

The details pertaining to these Directors seeking re-appointment are furnished in the section Directors Profile published elsewhere in this Annual Report. None of the aforesaid Directors of the Company are disqualified for being re-appointed as Directors pursuant to Section 274 (1) (g) of the Companies Act, 1956. A declaration to this effect has been obtained from the Directors retiring by rotation.

The Board recommends their re-appointment.

INTERNAL CONTROL

As per the NHB Directions, your Company has framed policies on Know Your Customer Guidelines, Anti-Money Laundering Standards, Fair Practice Code etc. in order to upgrade the procedures of collecting the information from the prospective borrowers and to ensure fair practices in dealing with the borrowers.

The Company has internal audit system whereby internal audit is conducted by the internal auditors and reports are submitted on a periodic basis. Besides, the Company has established a team in house for assessing that various policies and procedures being implemented from time to time are being understood and complied at all the levels. The report of such assessment is placed before the Board periodically.

TECHNOLOGY UPDATION

During the financial year 2009-2010, your Company further strengthened its IT infrastructure and systems to support its operations. New application software was implemented to provide improved information flow to branches and to further support the collection system.

AUDITORS

Pursuant to the recommendations of the Audit Committee at its meeting held on May 28, 2010, the Board of Directors of the Company has approved, subject to the approval of the Members at the ensuing Annual General Meeting, the appointment of M/s Chaturvedi & Co., Chartered Accountants, Kolkata, as the Statutory Auditors, of the Company for the financial year 2010-11.

In terms of the provisions of Section 224 of the Companies Act, 1956 ("the said Act") M/s Chaturvedi & Co. retire at this Annual General Meeting and being eligible, offer themselves for re-appointment. In terms of the provisions of Section 224 (1B) of the said Act, M/s Chaturvedi & Co. have furnished a certificate

that their appointment, if made will be within the limits prescribed under Section 224 (1B) of the said Act.

The Board of Directors recommends the appointment of M/s Chaturvedi & Co., Chartered Accountants, Kolkata, as the Statutory Auditors, of the Company for the financial year 2010-11.

AUDITORS OBSERVATIONS

The observations made by the Statutory Auditors in their report, read with the relevant notes to accounts, are self- explanatory. No adverse remark or observation is given by the Statutory Auditors.

PARTICULARS OF EMPLOYEES

The information in terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 as amended, is appended herewith.

STATUTORY INFORMATION

The Company does not own any manufacturing facility. Hence the particulars relating to conservation of energy and technology absorption as per section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable.

There has been no foreign exchange earning and outgo during the year under review.

DEPOSITORY SYSTEM

Your Company has entered into an agreement with CDSLV NSDL for transaction of shares in dematerialized form. 2, 24,151 shares of the Company constituting 3.20% of the paid up capital are held in physical form as on March 31, 2010. As per the Securities and Exchange Board of Indias (SEBI) instructions, the Companys shares have to be transacted in dematerialised form and therefore, members are requested to convert their holdings to dematerialised form.

HUMAN RESOURCES AND TRAINING

The Companys employees represent a resource around which all plans and profitability estimates are based. Our strong talent pool has shaped our growth trajectory and spearheaded our move into new domains. Your Directors wish to acknowledge the support and valuable contribution by the employees at all levels.

The Company continued to offer in-house training programme to staff members in executive development, leadership and management skills. The Company also sponsored its employees at all levels to attend various seminars and programmes conducted by esteemed 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.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act, 1956 and based on the information provided by the management, the Directors of the company confirm that:

- in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and that there are no material departures.

- in the selection of the Accounting Policies, consultation with the Statutory Auditors have been made and have applied them consistently, made judgements and estimates that are 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 of the company for that period.

- proper and sufficient care has been taken to the best of their knowledge and ability 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.

- the Annual Accounts have been prepared on a Going Concern Basis.

INSURANCE PROTECTION TO BORROWERS

Your Company continues its tie-up with National Insurance Company Limited for its comprehensive insurance cover product called "NATIONAL INSURANCE SAHARA HOME LOAN SURAKSHA BIMA" which covers the borrowers of the Company against the following risks/perils/natural calamities:

(a) PERSONAL ACCIDENT INSURANCE:

* Death due to accident;

* Accidental loss of two limbs, two eyes or one limb and one eye;

* Permanent total disablement from injuries other than named above.

(b) PROPERTY INSURANCE:

* Fire

* Storm

* Earthquake

* Riot, Strike and Malicious damage

* Lightning

* Explosion/Implosion

* Aircraft damage, Impact damage

* Subsidence and Landslide including Rock Slide

* Bursting or Overflowing of Water Tanks & Pipes, Missile testing operations

* Leakage from Automatic Sprinkler Installations, Bush Fire.

* Other natural calamities.

The other details regarding the product (e.g. Sum insured, premium payable etc.) are explained to the borrowers during personal discussion with them at the time of credit appraisal.

CORPORATE GOVERNANCE

Your Company has been complying with the principles of good corporate governance over the years. The Board of Directors support the broad principles of Corporate Governance. In addition to basic governing issues, the Board lays emphasis on Transparency, Accountability and Integrity.

The Corporate Governance Report is set out as an Annexure to this report.

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, Management Discussion and Analysis Report, Corporate Governance Report and Auditors Certificate regarding compliance form part of this Annual Report.

STATUTORY DISCLOSURES

None of the Directors of the company is disqualified to be appointed as Director under the provisions of Section 274(1 )(g) of the Companies Act, 1956. The Directors have made necessary disclosures, as required under various provisions of the Act and Clause 49 of the Listing Agreement with the Stock Exchange.

A NOTE OF APPRECIATION

Your Board of Directors would like to place on record their appreciation for the advice, guidance and support given by regulatory authorities including the NHB, RBI, SEBI, the Registrar of Companies, the Stock Exchange, Depositories and all the bankers of the Company. The Directors also place on record their sincere thanks to the Companys clientele for their patronage. The Directors acknowledge the understanding, support and the services of the sincere workers, staff and executives of the Company, which have largely contributed to the efficient operations & management of the Company. The Board would also like to express its sincere appreciation to all the Companys valued Shareholders, RTA, Service Providers and Counsellors for their continued support and patronage.

for and on behalf of the Board of

(O. P. Srivastava)

Director

(S. P. Ghosh)

Noida Director

May 28, 2010