Can Fin Homes Ltd
Directors Reports
1. FINANCIAL RESULTS
The financial performance for the FY 2022-23 is summarised here below:
|
|
(Rs. in Lakhs) |
Particulars |
Year ended March 31, 2023 |
Year ended March 31, 2022 |
Profit before Tax & Provisions |
86,578.93 |
68,200.01 |
Less: Impairment on financial instruments |
4,175.76 |
4,694.22 |
Profit before Tax |
82,403.17 |
63,505.79 |
Less: Tax expenses: |
|
|
(a) Provision for Tax - Current Year |
19970.99 |
17,039.02 |
- Previous Year |
360.92 |
(446.20) |
(b) Deferred Taxation |
(49.97) |
(197.54) |
Profit after Tax |
62,121.23 |
47,110.51 |
Add: Other Comprehensive Income |
|
|
A. Items that will not be reclassified to profit or loss |
|
|
(i) Actuarial (Gain)/ loss |
(81.07) |
(117.72) |
(ii) Income tax relating to items that will not be reclassified to
profit or loss |
20.40 |
29.63 |
B. Items that will be reclassified to profit or loss |
|
|
(i) Income tax relating to items that will be reclassified to profit
or loss |
0.00 |
0.00 |
Other Comprehensive Income |
(60.67) |
(88.09) |
Total Comprehensive Income for the period |
62,060.56 |
47,022.42 |
Balance brought forward from previous year |
36,134.88 |
25,770.70 |
|
98,195.44 |
72,793.12 |
Appropriations: |
|
|
Impact on adoption of Ind AS 116 |
|
|
Transfer to Special Reserve u/s.36(1)(viii) of the Income Tax Act,
1961 |
16,864.94 |
13,188.88 |
Transfer to General Reserve |
12,412.11 |
9,404.48 |
Additional Reserve (u/s.29C of the NHB Act) |
12,412.11 |
9,404.48 |
Dividend (including interim dividend) |
3,994.62 |
4,660.39 |
Tax on Distributed Profits |
0.00 |
0.00 |
Balance carried forward to balance sheet |
52,511.66 |
36,134.88 |
|
98,195.44 |
72,793.12 |
Note:(i) Figures have been regrouped wherever necessary while preparing the
statements as per IND-AS requirements.
(ii) The interim dividend of Rs.1.50 per equity share of face value of Rs.2/- each paid
by the Company during December 2022 has been accounted.
(iii) The proposed dividend of Rs.2/- per equity share is not recognised as liability
in the annual accounts as at March 31, 2023 (in compliance with IND AS 10 - events
occurring after the Balance sheet date). The same will be considered as liability on
approval by the Members at the 36th Annual General Meeting.
2. SHAREHOLDER'S WEALTH
Particulars |
Year ended March 31, 2023 |
Year ended March 31, 2022 |
| Earnings Per Share (EPS) (H) |
46.65 |
35.38 |
| Dividend Rate |
175%* |
150% |
| Market Price of shares (H) |
529.20 |
631.45 |
| Market Capitalisation (H in crore) |
7,046.51 |
8,408.02 |
* For the FY 2022-23 the proposed final dividend of Rs.2 per equity share is subject to
approval of shareholders at the 36th Annual General Meeting.
3. BUSINESS PERFORMANCE HIGHLIGHTS
During the FY 2022-23, Can Fin Homes Limited has performed well to record the highest
ever sanctions and disbursements. The Loan book surpassed Rs.31,500 Crore and the NPA
percentage was reduced from 0.64% (FY 202122) to 0.55% (FY 2022-23).
a) Sanctions
The Company has sanctioned Rs.9,307 Crore in FY 202223 as against Rs.8,896 Crore during
the previous year.
Since inception, the cumulative loan sanctions of your Company stood at Rs.66,805 Crore
at the end of the FY 2022-23.
Average ticket size of incremental housing loans and non-housing loans were Rs.25 Lakh
and Rs.8 Lakh, respectively.
b) Disbursements
Disbursements during the year amounted to Rs.8,947 Crore as ag ainst Rs.8,279 Crore
during FY 2021-22.
The cumulative loan disbursements from inception to the end of the FY 2022-23 was
Rs.60,806 Crore.
c) Loans outstanding (Loan Book)
The total loan book as at March 31, 2023 was Rs.31,563 Crore, recording a growth of
around 18% over last year (previous year Rs.26,711 Crore). At a portfolio level, housing
loans constitute 79%, non-housing loans comprised 21%.
d) Non-Performing Asset (NPA)
The Gross NPA of your Company as at March 31, 2023 was Rs.173.85 Crore (previous year
Rs.170.59 Crore). The net NPA as at March 31, 2023 was Rs.82.95 Crore (previous year
Rs.80.71 Crore). The gross NPA percentage as at March 31, 2023 stood at 0.55% compared to
0.64% as at March 31, 2022.
e) Profits
Your Directors are happy to inform that during the year under review, your Company
recorded an Operating Profit of Rs.865.79 Crore (previous year Rs.682.00 Crore), Profit
Before Tax (PBT) of Rs.824.03 Crore (previous year Rs.635.06 Crore) and Profit After Tax
(PAT) of Rs.621.21 Crore (previous year Rs.471.11 Crore).
During the year Company has made provisions for standard assets amounting to Rs.40.71
Crore (including management overlay amounting to Rs.17 crore). Provision for standard
assets was Rs.34.45 Crore during the previous year.
Provision was made for Non-performing assets amounting to Rs.1.03 Crore (previous year
Rs.22.29 Crore). Provisions for Tax Expenses (including Deferred Tax) amounting to
Rs.202.82 Crore (previous year Rs.163.95 Crore) was made.
f) Reserves
For reserves during the year, please refer 'Statement of changes in equity' for the
period ended March 31, 2023 in the Notes forming part of Financial Statements.
g) Dividend
Your Company has a consistent track record of dividend payments.
While recommending the dividend, your directors have considered applicable NHB and RBI
guidelines, Long term growth plans of the Company, minimum capital requirements and net
NPA ratio, etc. Your directors, after giving due consideration to Capital Adequacy
requirements, deferred tax liability, its impact on financial markets, the resultant
impact on the Company and the Dividend Distribution Policy, have recommended a final
dividend of Rs.2/- per equity share (100%), for the financial year ended March 31, 2023,
subject to the approval of the Shareholders at the ensuing Annual General Meeting of the
Company.
The Board of Directors at their meeting held on November 28, 2022 had declared and paid
the Interim dividend of Rs.1.50 per share (75%), for equity share of face value of Rs.2/-
each.
The total amount of dividend (Interim and Final) recommended for payment/paid for the
year under review is Rs.46.60 Crore. As per section 194 of Income Tax Act, the Company is
required to deduct Tax at Source (TDS) @ 10% on dividend payment if the aggregate dividend
amount exceeds Rs.5,000/-. However, no TDS shall be deducted for dividend payment to any
Insurance Company and Mutual Funds specified u/s 10(23D) of Income Tax Act. Moreover, as
per section 195 of the Act, TDS is required to be deducted @ 20% plus surcharge on payment
of Dividend to NonResidents. The Dividend Distribution Policy as required under regulation
43A of SEBI (LODR) Regulations, 2015, is available on the website of the Company (web link
https://www.canfinhomes.com/pdf/DIVIDEND- DISTRIBUTION-POLICY-2022-23.pdf).
4. EXPANSION OF BRANCH NETWORK
The network of branches was expanded prudently after due identification of potential
locations. Branch expansion was restricted on account of the Pandemic during the last
couple of years.
The Company opened five new branches during FY 202223 and upgraded Vidyaranyapura
Satellite office as a branch. As at the end of FY 2022-23, the branch network tally stood
at 205, spread across 21 States comprising 193 Branches and 12 Satellite Offices.
5. TECHNOLOGY INITIATIVES
All the branches and the Registered Office are connected through a core-banking
platform (Integrated Business Suite) with Cloud compute services. The Company has
implemented Multiprotocol Label Switching (MPLS) links for a higher bandwidth, security
and dedicated uptime.
In order to improve operational efficiency, your Company has implemented Central Know
Your Customer (CKYC) software, perfios and web-based Application software for Inspection
& Audit. The website of your Company is interactive and user friendly.
Digitalization measures enabled your Company to connect and engage with Customers for
business and collections.
Thrust on cyber security was given and security awareness was spread amongst the
employees regularly. Information on do's and don'ts to safeguard the information assets of
the Company is being communicated to the employees regularly.
The Business Continuity Plan is tested to address disruption risks in the event of an
unforeseen situation and to continue operations smoothly.
Your Company has digital meetings platform for Board and Committee meetings which is
paperless, secure, efficient and cost effective. Further, the Company has also a platform
for maintaining Structured Digital Database (SDD) for recording movement of Unpublished
Price Sensitive Information (UPSI).
Your Company is utilizing the Video Conferencing facility for Board meetings, review
meetings with branches, clusters and interviews for recruitments, etc.
Your Company is in the process of technology transformation by upgradation of digital
technology and Core Banking System, aiming at improved efficiencies and increased revenue.
6. CUSTOMER-FRIENDLY INITIATIVES
Adhering to its motto of 'Friendship Finance', the practices followed by the Company
are transparent, fair and impartial for the clients, customers, borrowers in all branches
across the country.
Details of the Company's loan and deposit products, schemes, charges and other
information are provided on the website of the Company.
In consonance with the Master Direction - Non-Banking Financial Company - Housing
Finance Company (Reserve Bank) Directions, 2021 (RBI Master Directions), the Fair
Practices Code (FPC) and Most Important Terms and Conditions (MITC) are regularly updated
and uploaded on the Company's website for the ready reference of our customers.
7. FINANCIAL RESOURCES
a) Refinance from National Housing Bank (NHB)
Under the NHB refinance scheme, your Company had got fresh refinance sanction amounting
to Rs.1,500 Crore and the same was availed in full during the year under review. Your
Company also availed an amount of Rs.1,000 Crore during the year out of unutilised balance
of Rs.2,200 Crore, which was sanctioned during the previous year.
b) Borrowings from Bank
During the year, borrowings were diversified through a combination of short-term and
long-term loans considering the asset liability management position and to minimize the
overall cost of funds. To diversify risks within banks, the Company had exposure from
Private and Public Sector Banks. The aggregate bank borrowings (term loans plus overdraft)
as at the end of the financial year stood at Rs.15,674.64 Crore; the overall borrowings
are within regulatory ceiling of 12 times of the Net Owned Funds.
The overall cost of borrowings from banks was 6.53% p.a. as at March 31, 2023. During
the year, the longterm 'rating' of the Company for term loans was [ICRA] AA+, signifying
high degree of safety regarding timely servicing of financial obligations.
c) Debentures
(i) Secured Redeemable Non-Convertible Debentures (NCDs)
The Company raised NCDs amounting to Rs.2,236 Crore (previous year Rs.2,135 Crore). The
debentures were secured by way of floating charge on the assets i.e., loan receivables
specifically earmarked for the purpose, in favour of the Debenture Trustees. The investors
to the NCDs are majorly insurance companies, public sector Banks, corporates, PF trusts,
mutual funds and other investors of repute, indicating their safety perception of your
Company's fundamentals and prospects.
The tenure of the outstanding NCDs ranges from 36 months to 39 months. The interest on
these debentures was serviced regularly. The outstanding borrowings by way of Secured NCDs
as at March 31, 2023 was Rs.4,896 Crore (previous year Rs.3,260 Crore). The average cost
of NCDs was 7.09% p.a. The NCDs were rated, CARE AAA' (Stable) by CARE Limited and '[ICRA]
AA+(Stable)' by ICRA Limited, signifying high degree of safety regarding timely servicing
of financial obligations and very low credit risk. These NCDs were listed on the Wholesale
Debt Market (WDM) segment of the National Stock Exchange of India Limited.
Your Company plans to raise NCDs up to a maximum of Rs.4,000 Crore from the date of
ensuing Annual General Meeting (AGM) upto the conclusion of the next AGM, subject to the
approval of members. However, NCDs will be raised subject to cost benefit, asset liability
management requirements, compliance with the regulatory guidelines, etc., in this regard.
(ii) Unsecured Non-Convertible Debentures (UNCDs)
During FY 2014-15, your Company had issued '8.94% Unsecured Non-Convertible Debentures'
in the nature of Tier II Bonds aggregating Rs.100 Crore for a tenure of 10 years. These
debentures are subordinated to present and future senior indebtedness of the Company and
qualify as Tier II Capital under the RBI Master Directions, 2021 [erstwhile National
Housing Bank (NHB) guidelines for assessing Capital Adequacy Requirements]. These Tier II
Bonds were rated, Ind AA+/Stable' by India Rating & Research. Your Company has
serviced the interest on the above UNCDs on the due date.
The Company is in compliance with the provisions of the RBI Master Directions, 2021
[erstwhile Housing Finance Companies issuance of NonConvertible Debentures on private
placement basis (NHB) Directions, 2014] and has been regular in payment of principal
and/or interest on the NCDs and UNCDs. Details of borrowings are provided in the notes to
accounts.
The Company affirms that there has been no deviation or variation in the utilisation of
proceeds of NCDs/UNCDs from the objects stated in the respective offer documents or
explanatory statement to the notice for the general meeting, as applicable. During the
year there were no public issues.
The Company confirms that the non-convertible debentures which became due for
redemption, have been paid in full and there are no unclaimed or unpaid NCDs/UNCDs as on
date.
d) Commercial Paper
Your Company mobilises funds through Commercial Paper (CP) for leveraging cost of
borrowing to the extent of undrawn Bank limits. The outstanding at the end of FY 2022-23
was Rs.1,350 Crore (previous year Rs.2,795 Crore). The effective cost of funds raised
through CP during the year was 5.67% p.a. The CP issued by your Company was rated at the
maximum [ICRA] A1+ by ICRA Ltd., and CARE A1+' by CARE Limited. Instruments with this
rating are considered to have very strong degree of safety regarding timely payment of
financial obligations.
The Company affirms that there has been no deviation or variation in the utilisation of
proceeds of Commercial Papers, from the objects stated in the respective offer documents.
e) Deposits
During the year your Company accepted new deposits amounting to 201.69 Crore (Previous
year Rs.266.94 Crore). The outstanding balance of deposits (including interest accrued,
but not due) as at March 31, 2023 was Rs.435 Crore (previous year Rs.505 Crore). The rate
of interest on public deposits ranged from 4.5% p.a. to 7.25% p.a. while the overall cost
(average) of deposits was 6.96% p.a. as at March 31, 2023.
As at March 31, 2023, a sum of Rs.11.94 Crore relating to 724 accounts of public
deposits (H13.93 Crore as at March 31, 2022 relating to 759 accounts) remained
unclaimed/overdue. Of this amount, a sum of Rs.4.92 Crore relating to 155 accounts
(previous year Rs.7.18 Crore relating to 129 accounts) were claimed and renewed/settled up
to May 31, 2023. Depositors were intimated regarding the maturity of deposits, with a
request to either renew or claim their deposits. Where the deposit remains unclaimed,
reminder letters/ SMS are sent to depositors periodically and follow up action is
initiated through the concerned branch. Your Company has not defaulted in repayment of
deposits or interest during the year. The Company has complied with the requirements under
Chapter V of the Companies Act, 2013 to the extent applicable'.
During the year, the deposit schemes of your Company have been rated 'ICRA AA+' Stable,
by ICRA Ltd., indicating 'highest credit-quality' and that the rated deposit programme
carried the lowest credit risk. Your Company, being a Housing Finance Company registered
with National Housing Bank (NHB), has complied with the Directions/Guidelines issued by
the NHB and RBI with regard to deposit acceptance and renewal. Your Company is exempted
from the applicability of the Companies (Acceptance of Deposits) Rules 2014.
As per the regulatory requirement vide the communication bearing reference,
RBI/2023-24/14 DOR.SFG.REC.10/30.01.021/2023-24 dated April 11, 2023, the Company has
already formulated the Green Deposits Policy.
f) Mortgage-backed securities
Your Company did not opt for securitisation during the year under review. There were no
securitised assets outstanding as at March 31, 2023.
8. REGULATORY COMPLIANCES
Compliance with Directions/ Guidelines of National Housing Bank (NHB) and other
statutes
Your Company has complied with the Master Direction - NonBanking Financial Company -
Housing Finance Company (Reserve Bank) Directions, 2021, which has been effective from
February 17, 2021. Your Company has adhered to all the guidelines and circulars issued by
RBI on asset classification of credit/ investments, credit rating, acceptance of deposits,
Fair Practices Code (FPC), Most Important Terms and Conditions (MITC), Customer Complaints
Redressal Mechanism, Know Your Customer (KYC), Anti-Money Laundering (AML) Guidelines,
Asset Liability Management, Capital Adequacy Ratio (CAR) norms, Information Technology
frameworks, CERSAI, Implementation of Indian Accounting Standards (Ind AS), Appointment of
Statutory Auditors, Guidelines on Reporting and Monitoring of Frauds in Housing Finance
Companies and all other related instructions, guidelines and circulars issued by the RBI
in letter and spirit with an explicit notification on the website of your Company, to the
extent applicable.
Further, Your Company is adhering to all the instructions, guidelines and circulars
issued during the year by RBI on various matters such as scale based Regulations, credit
ratings, outsourcing of Financial Services, regulatory restrictions on loans and advances,
registration with LEI, compensation of Key Managerial Personnel (KMP) and Senior
Management, investment grade credit rating for accepting public deposits, reporting of
exit of Senior Management Personnel (SMP) and/ or Non-Executive Directors (NEDs) and
succession planning and outsourcing of financial services, to the extent applicable.
NHB vide circular dated December 29, 2022 has implemented the XBRL based reporting
platform namely Centralised Reporting and Management information System (CRaMIS) for ease
of data submission and more efficient data collection and advised all the HFCs to submit
the returns which are due for submission as on December 31, 2022 through the XBRL based
CRaMIS Portal. Your Company has successfully registered on CRaMIS portal on January 03,
2023. All the data/ returns are being uploaded on the CRaMIS portal from January 03, 2023.
Your Company has complied with other related statutory Guidelines/Directions/Policies
as applicable to the Company from time to time. Compliance of all Regulatory directions/
guidelines of NHB/RBI other statutes are periodically reviewed by the Audit Committee and
the Board.
Your Company has complied with Indian Accounting Standards (Ind AS) as notified under
the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting
Standard) Amendment Rules, 2016 as applicable read with Section 133 of the Companies Act,
2013 and guidelines issued by National Housing Bank.
IRDAI Compliance
The Company is registered with IRDAI for carrying on the Insurance Agency Business and
has complied with the applicable requirements under Insurance Regulatory and Development
Act, 1999 and IRDAI (Registration of Corporate Agent) Regulations 2015, as amended from
time to time. Being an insurance intermediary, Company is maintaining all the required
information as per IRDAI rules. The Company has in place, an appropriate policy on
maintenance of records and destruction of old records as required under IRDA Guidelines.
Other Compliances
RBI vide it's Circular No. RBI/2022-23/34 DOR.CRE. REC.28/21.04.048/2022-23 dated April
21, 2022 has inserted para "103A. Legal Entity Identifier for Borrowers" under
"Chapter XIV of RBI Master Directions, 2021. As per the said para it was advised that
non-individual borrowers enjoying aggregate exposure of Rs.5 crore and above from banks
and financial institutions (FIs) shall be required to obtain LEI codes as per the
prescribed timeline. The Company, had already obtained on April 04, 2018, the Legal Entity
Identifier No.335800EJ9Y3XDP5ZDH81 under the erstwhile RBI/2017-18/82-DBR.No.BP.92/21.04.
048/2017- 18 dated November 02, 2017 as advised by NHB. The same has been renewed for the
year 2023-24.
As required under Section 215 of the Insolvency and Bankruptcy Code, 2016, the Company
has registered itself with National e-governance Services Limited (NeSL) authorized by
IBBI and obtained registration No.9160743937431514312. Further, the Company has executed
an agreement with NeSL on February 28, 2019 and the request by our creditors are being
authenticated on NeSL on regular basis.
The Company has registered on TReDS Platform through Receivables Exchange of India
Limited (RXIL) vide registration No.CA0000876. The Company is paying the annual fee for
maintenance of the said registration.
SEBI Circulars on Investors related matters:
In continuation of its earlier circulars dated November 03, 2021 and December 12, 2021
to put in place a framework for 'Common and simplified norms for processing investor's
service request by RTAs and norms for furnishing PAN, KYC details and Nomination' by
holders of physical securities, which came into effect from March 31, 2022, the SEBI has
issued a circular SEBI/HO/MIRSD/MIRSD-PoD-1/P/ CIR /2023/37 dated March 16, 2023 for
Common and simplified norms for processing investor's service requests by RTAs with the
norms for furnishing PAN, KYC details and Nomination. It was advised to intimate once
again directly the Shareholders, about folios which are incomplete with respect to PAN,
KYC details and Nomination.
Your Company had sent letters to all shareholders holding shares in physical form and
requested to furnish/update their valid PAN (PAN linked to Aadhar). As per the said
Circulars, the folios wherein any one of the documents or details are not available on or
after October 1, 2023, will be frozen by the RTA. The RTA will revert the frozen folios to
normal status upon receipt of all the documents. Further, linking of PAN with Aadhaar has
been made mandatory for all investors w.e.f. March 31, 2022.
Further, the shareholders were also requested to furnish/ update their KYC details,
Nomination details, Bank account particulars, specimen signature and contact details to
the RTA at the earliest.
As an on-going measure to enhance ease of dealing on security markets, SEBI has issued
the following Circulars for efficient and investor friendly processes:
(i) Circular S E B I / Rs.O/M I RS D/M I R S D_ RTA M B/P/ CIR/2022/70 dated May 25,
2022 - Reviewed the process followed by the Registrars to an Issue and Share Transfer
Agents and the Issuer companies for issuance of duplicate securities certificates. As per
Para 4 of the abovementioned SEBI Circular, it was advised that the
listed company shall take special contingency insurance policy from the insurance
company towards the risk arising out of the requirements relating to issuance of duplicate
securities in order to safeguard and protect the interest of the listed company. In this
regard, the Company has taken Special Contingency Policy.
(ii) Circular No. SEBI/HO/MIRSD/MIRSD_RTAMB/P/ CIR/2022/65 dated May 18, 2023 issued
simplification of procedure and standardization of formats of documents for transmission
of securities.
(iii) Circular No. SEBI/HO/OIAE/2023/03391 dated January 27, 2023 issued a letter to
all listed Companies and RTA's for generating awareness on availability of Dispute
Resolution Mechanism at Stock Exchanges against Listed Companies /Registrar to an Issue
and Share Transfer Agents (RTAs). In this regard it was advised that listed Companies
shall co-ordinate with RTAs and shall arrange for sending SMS/ E-mail to all the investors
who hold shares in physical form stating that if they have any dispute against the Company
and/ or its Registrar and Share Transfer Agent (RTA) on delay or default in processing
requests, as per SEBI circular no. SEBI/HO/CFD/DIL2/P/CIR /2022/75 dated May 30, 2022,
they can file for arbitration with Stock Exchange. Your Company has sent SMS, E-mails and
registered post/speed post to their last known address of the physical shareholders to
appraise them about the facility made available.
The Company has also complied with other SEBI circulars issued during the year on GST,
NCDs, CPs, ISINs, etc., to the extent applicable.
9. COMPLIANCE UNDER THE COMPANIES ACT, 2013
Your Company has complied with the requirements of the applicable provisions of the
Companies Act, 2013 and related Rules during the FY 2022-23. As per the requirements under
Section 92(3) of the Act and Rules framed thereunder, the extract of the Annual Return for
FY 2022-23 is uploaded on the website of the Company and the same is available at 'Events'
Page. The link for the same is https://www.
canfinhomes.com/pdf/form-MGT-7-Provisional-2023. pdf. For more details regarding
Compliances, please refer the Secretarial Audit Report enclosed to this Report as
Annexure-1.
Significant and material orders
There are no significant and material orders passed by the Regulators or Courts or
Tribunals impacting the going concern status and the Company's operations in future. The
details of penalty levied by the Regulator NHB/RBI are provided in the Report on corporate
governance.
There are no material changes and commitments affecting the financial position of the
Company which have occurred after March 31, 2023 till the date of this report.
CSR activities:
The details of the activities undertaken by the Company as required under the
provisions of the Companies Act, 2013 and related rules are provided in detail in Para 22
infra.
The information relating to the particulars on spending in terms of the Corporate
Social Responsibility Policy and reasons for not spending/carrying forward the balance
amount, if any, during the current year are disclosed in Annexure - 2 to the Report of
Directors, forming part of this Annual Report.
The activities undertaken by the Company under CSR are on pan India basis and the
projects are executed through the Registered Office and branches of the Company at the
respective locations. The total amount/ budget under CSR for the FY 2022-23 was Rs.11.80
Crore, out of which an amount of Rs.7.83 Crore was spent during the year. The entire
undisbursed amount of Rs.4.18 Crore pertaining to on-going projects of previous years were
spent during the current year. The balance unspent amount of current year Rs.3.07 Crore
which is already sanctioned in the FY 2022-23 has been transferred to unspent CSR Account
on April 21, 2023 and H0.90 Lakh was disbursed during the month of April 2023, as per the
provisions of Companies Act, 2013 and will be disbursed based on the progress of work.
10. CAPITAL ADEQUACY
The Capital Adequacy Ratio (CAR) of your Company as at March 31, 2023 stood at 23.07%
(previous year 23.15%) as against the benchmark of 15% prescribed by the RBI Master
Directions, 2021.
11. DEPRECIATION
Depreciation was calculated on the written down value method based on useful life, in
the manner prescribed in Schedule II to the Companies Act, 2013.
12. DEFERRED TAX ASSET (DTA)
During the year, deferred tax asset (net) of H0.50 Crore (previous year Rs.1.98 Crore)
was considered in the Statement of Profit & Loss, on account of various components of
asset and liabilities. The DTA outstanding as at March 31, 2023 was Rs.48.43 Crore
(previous year Rs.47.73 Crore).
13. RECOVERY ACTION UNDER SECURITISATION & RECONSTRUCTION OF FINANCIAL ASSETS AND
ENFORCEMENT OF SECURITY INTEREST ACT, 2002 (SARFAESI ACT)
During the year, your Company initiated action against 939 defaulting borrowers under
the Securitisation and Reconstruction of Financial Assets and Enforcement of Security
Interest ("SARFAESI") Act, 2002 and recovered Rs.54.62 Crore (previous year
Rs.49.48 Crore) from borrowers. Out of the above amount, Rs.16.27 Crore (previous year
Rs.9.66 Crore) was recovered by way of sale of assets under SARFAESI. Apart from this,
H0.90 Crore was recovered in Written-off accounts.
14. LISTING OF SECURITIES:
The equity shares of the Company continued to be listed on the BSE Limited (BSE),
Mumbai and the National Stock Exchange of India Ltd. (NSE), Mumbai.
The NCDs/UNCDs issued on private placement are listed on National Stock Exchange of
India Ltd.
As per SEBI Circular SEBI/HO/DDHS/P/CIR/2021/613 dated August 10, 2021 (updated as on
April 13, 2022), captioned "Operational Circular for issue and listing of
Non-convertible Securities, Securitised Debt Instruments, Security Receipts, Municipal
Debt Securities and Commercial Paper" the Company has listed its Commercial Papers
(CPs) on BSE Limited (BSE).
15. HUMAN RESOURCES DEVELOPMENT
The total number of employees of the Company was 976 (811 regular and 165 on contract)
as on March 31, 2023 as against 909 (799 regular and 110 on contract) as at the end of the
previous year.
Employees form the backbone of the Company. Their knowledge, dedication, aptitude,
skills are of primary importance. The Company therefore ensures that the employees are
fully equipped to discharge their duties effectively and efficiently and provide the
necessary support in this direction by organizing training programmes, orientation
sessions, imparting on the job training, enabling them to take part in seminars/ webinars
etc. conducted by Regulatory authorities and reputed institutions.
During the year, training in credit, information technology, human relations, customer
service, Grievance redressal, finance, taxation, marketing, fraud prevention, KYC &
AML, human rights, prevention of sexual harassment at work place and other topics of
importance was imparted to employees and executives.
Your Company has put in place a series of HR measures and performance linked incentive
including schemes to motivate employees to do better. Industrial relations in your Company
continued to be cordial during the year.
During FY 2022-23, no employee, other than the Managing Director, who earns a
remuneration of Rs.12.50 Lakhs per month, was employed for a part of the year with a
remuneration of Rs.9.15 Lakh or more per month. The ratio of remuneration of each Director
to the median of employees' remuneration and such other details as required under Sec
197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules 2014 and 2016 are furnished below:
(i) Ratio of remuneration of each director to the median employees' remuneration for FY
2022-23
The ratio of the remuneration of Managing Director to the median remuneration of the
employees (regular employees) of the Company for the FY 2022-23 was 13.37:1
The ratio of the remuneration of Dy. Managing Director to the median remuneration of
the employees (regular employees) of the Company for the FY2022-23 was 3.3:1
Non-executive Directors and Independent Directors are eligible for sitting fee only.
The details of sitting fee paid to the Directors for the meetings of Board and Committees
are given in the Report of Directors on corporate governance'.
(ii) Percentage increase in the remuneration of each Director and Key Managerial
Personnel in FY 2022-23
The percentage increase in remuneration in the financial year for the Managing Director
& CEO was NIL and that of the Deputy Managing Director was 20.21%. The other Key
managerial personnel of the Company are the General Manager, the Chief Financial Officer
and the Company Secretary and the percentage increase in their remuneration was 19.22%,
34.48% and 14.98% respectively.
(iii) Percentage increase in the median remuneration of employees in FY 2022-23
The total number of permanent employees of the Company were 811 as on March 31, 2023.
Apart from the permanent employees, there were 165 employees on contract as on March 31,
2023.
The percentage increase in the median remuneration of employees in the financial year
was 9.12%.
(iv) Average percentile increase already made in salaries of employees other than
managerial personnel in last financial year and its comparison with the percentile
increase in managerial remuneration
Average percentage increase in remuneration of the employees other than managerial
personnel in the last financial year was 5.48% and that of Managerial remuneration was
6.28% during the period under review.
The average increase in the remuneration of both, the managerial and non-managerial
personnel was determined based on the Annual Performance Evaluation and also based on the
remuneration policy as recommended by the Nomination Remuneration & HR Committee of
Directors and approved by the Board of Directors. There were no exceptional circumstances
which warranted an increase in managerial remuneration which was not justified by the
overall performance of the Company. The Company affirms that the remuneration is as per
the remuneration policy of the Company.
(v) Prevention of Sexual Harassment of Women at the Workplace.
The Company has a Policy on 'Prevention of Sexual Harassment of Women at Workplace' and
matters connected therewith or incidental thereto covering all the aspects as contained
under the Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal)
Act, 2013. During FY 2022-23 no cases of sexual harassment were reported.
(vi) Affirmation that the remuneration is as per the Remuneration Policy of the
Company:
It is affirmed that the remuneration paid is as per the Remuneration Policy, applicable
for Directors, Key Managerial Personnel and other employees, adopted by the Company.
The Company has also in place "Equal Opportunity Policy" as per Section 21(1)
of Rights of the Persons with Disabilities Act, 2018.
The Company has laid down a Code of Conduct for Prevention of Insider Trading, in
accordance with the requirements under the Securities and Exchange Board of India
(Prevention of Insider Trading) Regulations, 2015 and Companies Act, 2013, with a view to
regulate trading in Securities of the Company by its directors, designated persons and
employees. The same is made available on the website of the Company. For related link,
please refer Annexure-5.
16. TRANSFER OF UNCLAIMED AND UNPAID
DIVIDEND/ DEPOSIT AMOUNTS TO THE INVESTOR EDUCATION AND PROTECTION
FUND (IEPF)
In terms of section 124 and 125 of the Companies Act, 2013, the amounts (dividend,
deposits etc., with interest) that remained unclaimed and unpaid for more than 7 years
from the date they first became due for payment, should be transferred to IEPF. As an
investor-friendly measure, your Company has been intimating the respective shareholders /
depositors/investors to encash their dividend warrant/renew matured deposits or lodge
their claim for payment of dues, if any, from time to time and the claims made were
settled. As per the statutory requirements, the details of such amounts are made available
on the website of MCA-IEPF as well as on the Company's website. In order to pay dividend
amounts online, the members/investors are requested to get their shares converted from
physical to DEMAT mode, register their bank account particulars and/or opt for ECS
facility.
Unclaimed dividends
As at March 31, 2023, dividends aggregating to Rs.1.98 Crore (Previous year Rs.1.96
Crore) relating to dividends declared for the years FY 2015-16 to FY 2021-22 (of which
Rs.0.29 Crore related to Interim & Final dividend for the year 2022), had not been
claimed by members. As an investor friendly measure, your Company has intimated members to
lodge their claims and related particulars with the Company/ RTA. The dividend pertaining
to 2014-15, which remained unclaimed/unpaid amounting to H0.20 Crore (in respect of 2053
shareholders), was transferred to IEPF on August 12, 2022, after settlement of claims by
members received in response to the individual reminder letters sent by your Company to
the respective members. The dividend pertaining to 2015-16 remaining unclaimed and unpaid,
amounting to Rs.0.27 Crore (in respect of 2091 shareholders) as at March 31, 2023, would
be transferred to IEPF during August 2023 after settlement of the claims, if any,
received.
The Company takes various initiatives to reduce the quantum of unclaimed dividend and
has been periodically intimating the concerned members, requesting them to encash their
dividend before it becomes due for transfer to the IEPF.
a) Transfer of shares to IEPF Demat account
Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and
refund) Amendment Rules, 2017 was notified by the Ministry of Corporate Affairs (MCA) on
October 13, 2017. As per Rule 6 of the said Rules, the shares, in respect of which
dividend amounts have not been paid or claimed for 7 consecutive years, are required to be
transferred to 'IEPF demat Account' of IEPF Authority. On verification of records of
unpaid/unclaimed dividend, during FY 2022-23, 39 shareholders had not claimed dividend for
consecutive 7 years and their shares 28,900 Nos. have been transferred to IEPF demat
account within the prescribed period i.e. on 02/09/2022. The details of such transfer are
provided on the website of the Company. For more details, please refer 'General
Information to shareholders' in this report.
The status of shares transferred to IEPF as at March 31, 2023, is detailed as under:
Particulars |
No. of Shares |
Balance as at April 1, 2022 |
4,65,800 |
Transferred during financial year 2022-23 |
28,900 |
Claims processed by IEPF Authority during the financial year 2022-23 |
(2,750) |
Balance as at March 31, 2023 |
4,91,950 |
In terms of the above Rules, reminder letters were sent by the Company to all the
shareholders who had not claimed their dividends for a consecutive period of 7 years,
informing that their shares will be transferred to IEPF suspense account on the due date
i.e., September 25, 2023, if they do not place their claim for unclaimed dividend amounts
to the Company. Your Company has provided the related details on its website (Investors
page).
b) Unclaimed deposits
Deposits remaining unclaimed for a period of seven years from the date they became due
for payment, have to be transferred to the Investor Education and Protection Fund (IEPF)
established by the Central Government. The concerned depositor can claim the deposit from
the IEPF. As required under Section 125 of the Companies Act, 2013, the unclaimed and
unpaid deposits together with interest for the year 2015-16 amounting to H0.25 Crore
(previous year H0.32 Crore) that remained unclaimed and unpaid for a period of 7 years
were transferred to IEPF during the year under review.
17. PARTICULARS REGARDING CONSERVATION
OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
During the year, your Company did not earn any income or incur any expenditure in
foreign currency/exchange other than payment of Dividend 2022 and interim Dividend 2023 to
NRIs on repatriation basis to an extent of Rs.0.16 Crore through authorised dealers.
Since your Company is a Housing Finance Company and does not carry-out any
manufacturing activity, the requirement relating to providing the particulars relating to
conservation of energy and technology absorption as per Sec 134(3)(m) of the Companies
Act, 2013 read with Rule 8 of the Companies (Accounts) Rules 2014, are not applicable.
Given the nature of business, the Company does not use energy intensively. The Company
takes measures towards optimum energy utilisation and conservation, as its responsibility
towards the Society by installation and use of Solar Power systems, Solar UPS and power
saving lamps like LED lights instead of conventional CFL & Fluorescent lamps in some
of its branches.
As a part of Save Green efforts and leverage of technology, a lot of paper work at
branches and the Registered Office has been reduced (also refer para 5).
As a green initiative, the Company has started availing the services of 'Dess Digital
Software' for sharing the soft copies of agenda papers pertaining to all the Board and
Committee meetings, with the Directors and executives. The other steps include;
• Disposal of E-waste done through the certified e-waste vendor.
• Minimised use of packaged drinking water to reduce the use of plastic bottles.
• Reduced exterior lighting including front lights, Glow sign Boards, etc.
• Old Fluorescent Tubes (FT) & Compact Fluorescent Lamp (CFL) are being
replaced with LED.
• Old Air Conditioners are being replaced with power saving ones.
• Old Desktops have been replaced with All-in-one systems.
• Proper earthing done, to avoid wastage of power.
18. DIRECTORS & KEY MANAGERIAL PERSONNEL APPOINTMENTS / RE- APPOINTMENTS:
The Board of Directors made the following appointments/ re-appointments based on the
recommendations of the Nomination Remuneration & HR Committee on fit and proper
criteria and performance evaluation of the Directors:
1) Shri. Arvind Narayan Yennemadi was appointed as an Independent Director at the
Annual General Meeting held on September 07, 2022 for a tenure of 3 years up to the
conclusion of the Annual General Meeting of the Company for the financial year 2024-25.
2) Shri. Anup Sankar Bhattacharya was appointed as an Independent Director at the
Annual General Meeting held on September 07, 2022 for a tenure of 3 years up to the
conclusion of the Annual General Meeting of the Company for the financial year 2024-25.
3) Shri. Suresh Srinivasan Iyer was appointed as the Managing Director and Chief
Executive Officer (CEO) of the Company by the Board of Directors on March 18, 2023
initially for a fixed term of 3 years and further extendable to 2 years. The appointment
was approved by the members through Postal Ballot on June 04, 2023.
4) Shri. K Satyanarayana Raju, Managing Director and CEO of Canara Bank was appointed
as an Additional Director (Non-executive Promoter) on the Board of the Company w.e.f.
April 26, 2023 for a tenure upto the date of his superannuation i.e., December 31, 2025.
He has been elected as the Chairman of the Board, at the said meeting.
5) Shri. Murali Ramaswami has been appointed as an Additional Director (Non-executive
Independent) by the Board of Directors of the Company on June 19, 2023.
6) Shri. Ajay Kumar Singh has been appointed as an additional director and Deputy
Managing Director by the Board on June 19, 2023.
In accordance with the provisions of the Companies Act, 2013 and the Articles of
Association of the Company, Shri. Debashish Mukherjee is liable to retire by rotation at
the ensuing AGM and is eligible for re-appointment. The agenda relating to re-appointment
of Shri. Debashish Mukherjee, appointment of Shri. K Satyanarayana Raju (Non-executive
Promoter), re-appointment of Smt. Shubhalakshmi Panse (Non-executive Independent),
appointment of Shri. Murali Ramaswami (Non-executive Independent) and approval for
appointment of Shri. Ajay Kumar Singh are included in the Notice of the ensuing Annual
General Meeting and complete particulars of the Directors are provided in the Explanatory
Statements forming part of the said Notice.
The directors had filed their consent(s) and declaration(s) that they are not
disqualified to become directors in terms of the provisions of Companies Act, 2013 and
related Rules.
Shri. Suresh Srinivasan Iyer, Managing Director and CEO of the Company has declared
that he is holding 100 nos. of equity shares, Further, as per his declarations, he has not
taken any loan(s) from the Company.
All the other Directors have intimated to the Company that they are neither holding any
shares nor taken any loan(s) from the Company.
Brief profile of all the Directors are provided in page Nos. 22 to 25 of this Annual
Report.
Key Managerial Personnel:
Shri. Suresh Srinivasan Iyer, on his appointment as the Managing Director and Chief
Executive Officer (CEO) of the Company by the Board of Directors on March 18, 2023, has
been designated by the Board as the Key Managerial Personnel.
Shri. Prashanth Joishy, Deputy General Manager and the Chief Financial Officer of the
Company had stepped down from the post of Chief Financial Officer on January 03, 2023,
after office hours. Shri. Prashant Joishy, Deputy General Manager, continues to be on the
rolls of the Company.
Shri. Apurav Agarwal, ACA, was appointed as the Chief Financial Officer and Key
Managerial Personnel of the Company w.e.f. January 04, 2023 by the Board of Directors of
the Company at its Meeting held on January 03, 2023. The appointment is in terms of the
provisions of Section 203 and all other applicable provisions of the Companies Act, 2013
read with the applicable Rules.
Smt. Shamila M, General Manager and Key Managerial Personnel opted for voluntary
retirement and was relieved from the services on May 27, 2023.
Smt. Veena G Kamath, Company Secretary and Key Managerial Personnel resigned on June
16, 2023 on account of relocation. She will continue to discharge her duties during the
notice period.
Resignation/Vacation of Office:
Shri. G Naganathan (DIN: 00594503), Non-executive Independent Director on the Board of
Company has vacated office on the conclusion of the 35th Annual General Meeting
of the Company on September 7, 2022, on completion of his tenure.
The tenure of office of Smt. Shubhalakshmi Aamod Panse, Non-executive and Independent
Director, will be completed on conclusion of the ensuing Annual General Meeting of the
Company and the proposal for her re-appointment is being placed before the members at the
ensuing Annual General Meeting.
Shri. Amitabh Chatterjee, Deputy Managing Director was repatriated and transfered back
to Canara Bank on June 01, 2023.
Shri. Satish Kumar Kalra, Non-executive and Independent Director, has resigned on June
06, 2023 on personal grounds.
Retirement by rotation and re-appointment:
In terms of Section 152 and all other applicable provisions of the Companies Act, 2013,
and the Articles of Association of the Company, Shri. Debashish Mukherjee, Director
(Nonexecutive and Promoter) retire by rotation at the ensuing
Annual General Meeting and being eligible, offers himself for re-appointment. The
agenda relating to re-appointment of Shri. Debashish Mukherjee forms part of the Notice
convening the ensuing Annual General Meeting and all other relevant information as per
SEBI Regulations are provided in the explanatory statement.
All the appointments and re-appointments of Directors are made by the Board of
Directors on the recommendations of the Nomination Remuneration & HR Committee on fit
and proper criteria and also based on the performance evaluation of the Directors.
All the appointments and re-appointments mentioned above, which form part of the Notice
of the ensuing Annual General Meeting of the Company, are recommended by your Directors to
the members for appointment/re- appointment/approval.
19. MEETINGS OF THE BOARD
During the Financial year 2022-23, eleven meetings of the Board of Directors were held
and the related details, including that of various committees constituted by the Board,
are made available in the Report of Directors on corporate governance forming part of this
Annual Report placed before the members. Your Company has complied with all the
requirements as applicable under Companies Act, 2013 and related rules, SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 and also the Master Direction
-Non-Banking Financial Company -Housing Finance Company (Reserve Bank) Directions, 2021,
in relation to the Board of Directors and the Committees of the Board.
Committees of the Board:
The Board has constituted seven Committees viz. the Audit Committee, the Nomination
Remuneration & HR Committee, the Corporate Social Responsibility Committee, the
Stakeholders Relationship Committee, the Risk Management Committee, the Management
Committee and the IT Strategy Committee.
A detailed note on the composition of the Board and its Committees and other related
particulars are provided in the Report of Directors on corporate governance forming part
of this Annual Report.
20. DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the provisions of section 134(3)(c) of the Companies Act, 2013 and
based on the information provided by the management and review of the draft statement by
the Audit Committee, the Board of Directors report that-
a) In the preparation of the annual accounts for the year ended on March 31, 2023, the
applicable accounting standards have been followed and there are no material departures;
b) The Directors had selected such accounting policies and applied them consistently
and 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 for the financial year ended on March 31,
2023 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 accounts on an ongoing concern basis;
e) This being a listed Company, 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.
Declaration by Independent Directors:
The Independent Directors have given declarations to the Company in terms of Section
149(7) and 149(8) of the Companies Act, 2013 and Regulation 25(8) of SEBI (LODR)
Regulations, 2015 that they meet the criteria of independence as provided in Section
149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (LODR), 2015. There has
been no change in the circumstances affecting their status as Independent Directors of the
Company.
All the Independent Directors of the Company are persons of integrity, expertise and
experience and have obtained certificates from the Institute notified under Section 150(1)
of the Act, either by completing the online proficiency selfassessment test or by way of
exemptions from taking the tests, since they were Directors for more than 10 years from
the date specified.
Code of Conduct:
In terms of Regulation 26(3) of the SEBI (LODR) Regulations, 2015, all the members of
the Board and Senior Management Personnel have affirmed compliance with the Code of
Conduct of Board of Directors and Senior Management for the FY 2022-23. As required under
Schedule V(D) of the said Regulations, a declaration signed by the Managing Director &
Chief Executive Officer of the Company stating that the members of the Board and the
Senior Management Personnel have affirmed compliance of their respective Codes of Conduct,
is placed as an Annexure to the corporate governance report.
21. NOMINATION REMUNERATION AND HR COMMITTEE (NRC) POLICY
Your Company has constituted a Nomination Remuneration and HR Committee (NRC)' of the
Board in terms of Section 178 of the Act, Regulation 19 of the SEBI (Listing Obligations
& Disclosure Requirements) Regulations, 2015 and RBI Master Directions for HFCs, 2021.
This Committee identifies persons who are qualified to become Directors of the Company.
The appointment, renewal, re-appointment, re-categorisation and/or removal of the
Directors so identified, including extension or continuation of the term of appointment,
will be recommended by the NRC to the Board. This Committee has also laid down the
criteria to identify persons who may be appointed to the senior management of the Company.
The NRC has formulated the criteria for determining qualifications, positive attributes
and independence of a Director, carrying out evaluation of every Director's performance,
performance of the Board and that of the Committees. The NRC Policy of the Company
covering all the above aspects is made available on the official website of the Company in
terms of Section 134(3) of the Companies Act, 2013. The Board has ensured evaluation of
performance of the Board, its Committees and of the individual directors through the
meeting of independent directors, meeting of the Nomination Remuneration & HR
Committee and evaluation by each of the directors independently, for the year ended March
31, 2023.
22. CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY
The Company has given importance to promote education including special education for
tribal students, Construction of class room blocks for Government schools, construction of
girls Hostels, providing stationeries and furniture to Government schools, setting up of
'Mini Science Labs' (TINKER Labs), vocational training, skill enhancement programmes,
renovation of Anganawadis, scholarship for under privileged, support for girl child
education, providing sanitation and drinking water facility. The Company also contributed
for health care by providing medical equipment and machineries, supported old age homes,
orphanages and residential homes for differently abled people, installed RO water
purification systems in various schools and hospitals, constructed shelters for animal
welfare, donated veterinary equipment and machineries to carryout rescue, treatment and
rehabilitation of injured animals. In order to promote renewable energy sources, the
Company has contributed towards installation of solar power systems at government schools
and solar lighting systems in various villages. The Company has taken various welfare
measures for girl child, sports and for women empowerment.
The activities undertaken by the Company under CSR is pan India basis and the projects
are executed by Registered Office and our branches in those areas. The total amount/
budget under CSR for the FY 2022-23 was Rs.1180.63 lakhs. The total amount spent under the
CSR activities in FY 202223 is Rs.782.72 lakhs. The balance amount of Rs.397.89 lakhs
which is already sanctioned in the FY 2022-23 has been transferred to unspent CSR Account
during April, 2023 as per provisions of Companies Act and will be disbursed as per the
progress of the work.
A summary of CSR details as on March 31, 2023 is given below:
|
31-03-2023 |
Sl. No. Activities undertaken |
No. of organisation (Beneficiaries) |
Amount Rs. |
1. Animal welfare |
5 |
51,23,948 |
2. Construction/repair & renovation of schools/Hostels |
3 |
33,15,100 |
3. Desks & Benches/Tables/Almirah/Green Board/ Chairs Etc. |
12 |
88,33,116 |
4. Drinking water facility/Supply of others articles of necessity etc. |
22 |
1,26,56,037 |
5. Scholarship to students and sponsorship of child education |
5 |
34,97,560 |
6. Equipment/Medical Vans/Drinking water facility to Hospitals |
13 |
2,16,64,739 |
7. Supported/Equipment to old age homes, orphanages, and residential
homes for differently abled people |
2 |
11,09,538 |
8. Providing education materials including books, school bags, etc. to
the poor children of government schools or schools situated in rural/backward areas |
4 |
11,29,892 |
9. Providing training facilities to enhance vocational skills to the
poor section of the society |
1 |
3,10,500 |
10. Renewable energy projects |
20 |
1,30,69,953 |
11. Welfare measures |
6 |
36,57,626 |
12. Promoting Tribal Sports |
1 |
7,50,000 |
13. Women Empowerment |
4 |
31,54,330 |
Grand Total |
98 |
7,82,72,339 |
The Annual Report on CSR activities including brief contents are provided as Annexure 2
to this report.
23. RISK MANAGEMENT POLICY
The Company has a structured Risk Management Framework, designed to identify, assess
and mitigate risks appropriately. Your Company has constituted a Risk Management Committee
with five Directors, Chief Risk Officer (CRO), Chief Compliance Officer (CCO) and the
General Manager of the Company. The Committee is responsible for monitoring and reviewing
risk management policy & plan and managing enterprise wide risk. The key risks
associated with the business of the company, causes and efficacy of the measures taken to
mitigate are monitored by the committee. Details regarding the same are covered in the
management discussion and analysis report which forms part of this Annual Report. In terms
of Section 134(3)(n) of the Act, your Directors wish to state that your Company has
adhered to the Risk Management Policy. The above policy was reviewed during the year.
24. AUDIT AND INTERNAL CONTROL
Your Company has strengthened the existing internal control systems by introducing
measures for minimising operational risks commensurate with the nature of its business and
size of operations by reviews at periodical intervals. Further, your Company has reviewed
delegation of authorities and streamlined standard operating procedures for all areas of
its business, operations, functions, strengthened the Offsite Transaction Monitoring
System (OTMS) to track transactions, early-warning signals across all branches by
introducing innovative monitoring tools.
The National Housing Bank conducts inspection of your Company on an annual basis.
During the year, the NHB conducted regular inspection of your Company during January 2023
and February 2023, for the position as at March 31, 2022. The Report has been received and
the Company has sent a reply within the prescribed time.
Your Company has also put in place a well-defined policy on Risk Based Internal Audit
(RBIA) and as per the said policy, 189 branches and 1 CPC were audited in the FY 2022-23.
During the year, 46 loan accounts pertaining to 5 branches, amounting to Rs.5.15 crores
has been declared as fraudulent and have been reported to the authorities/ regulators. The
Company has classified these accounts as Non-performing Assets and made 100% provision in
line with regulatory guidelines. The Audit Committee reviews the audit reports/ remarks/
observations and replies/ compliances including the compliance of KYC norms.
Regular inspection of your Company for review period August 01, 2020 to July 31, 2022
was conducted by Canara Bank. The compliance on the observations were reviewed by the
Audit Committee and the Board. Management Audit by Canara Bank was conducted during
September-2022 for the review period January 01, 2021 to August 31, 2022.
Reporting of Frauds
There was no instance of fraud during the year under review, which required the
Statutory Auditors to report to the Audit Committee and / or to the Board as required
under Section 143(12) of the Act and the rules made thereunder.
25. SECRETARIAL AUDIT & SECRETARIAL COMPLIANCE
As required under section 204 of the Companies Act, 2013 and Rules thereof, the Board
appointed M/s Swayambhu Viswanathan, Practising Company Secretaries, for conducting the
'Secretarial Audit' of the Company and for submission of the Annual Secretarial Compliance
Report for the financial year 2022-23. The Secretarial Audit for FY 2022-23 was conducted
as required u/s.204 of the Companies Act 2013, Regulation 24A of SEBI(LODR) Regulation
2015, by Shri. Swayambhu Viswanathan, FCS, Practising Company Secretary and his team. The
report does not contain any qualification, reservation or adverse remark. The said report
also includes the affirmation as per NSE Circular No. NSE/CML/ 2023/09 dated January 25,
2023 and NSE Circular No. NSE/CML/25 dated March 29, 2023 on Standard Operating Process
under SEBI (PIT) Regulations, 2015 for ensuring compliance with Structured Digital
Database ("SDD"). The Secretarial Audit Report issued by the Practising Company
Secretaries is enclosed to the Report of Directors as Annexure -2 in terms of Section
134(3) (f) read with Section 204(1) of the Act.
In addition to the Secretarial Audit Report, Secretarial Compliance Report has also
been issued by the PCS as per the SEBI Circular No.CIR/CFD/CMD1/27/2019 dated February 08,
2019 and NSE Circular No.NSE/CML/2023/30 dated April 10, 2023. The said report has also
been submitted to the Stock Exchanges within the prescribed timeline.
Secretarial Standards
The Company has complied with the applicable Secretarial Standards i.e., SS-1 and SS-2
issued by the Institute of Company Secretaries of India for meetings and has referred to
Secretarial Standards SS-3 for Dividend and SS-4 for Board's Report, for good governance.
Loans, Guarantees or Investments:
There are no particulars of loans, guarantees or investments made during the year in
terms of Section 186(1) and 186(2) of the Act requiring disclosure to be made in the
report of Directors as required under Section 134(3)(g) of the Act.
Since the Company is a NBFC-HFC, the disclosures regarding particulars of the loans
given, guarantees given and securities provided is exempt under the provisions of Section
186 (11) of the Companies Act, 2013. As regards investments made by the Company, the
details of the same are provided in notes to the financial statements of the Company for
the year ended March 31, 2023.
Related Party Transactions:
The particulars of contracts or arrangements with the 'Related Parties' referred to in
sub-section (1) of Section 188 of the Act, are furnished in Note No.44 of the Notes
forming part of the financial statements for FY 2022-23, forming a part of the Annual
Report. The particulars of Related Party Transactions as required u/s sec 134(3)(h) in the
prescribed format (AOC-2) is attached to this Report as Annexure-3.
STATUTORY AUDITORS
M/s. B Srinivasa Rao & Co (Registration No.: 008763S) and M/s. B K Ramadhyani &
Co. LLP, Chartered Accountants (Registration No.: 002878S/S200021) are the joint Statutory
Central Auditors of the Company to hold office for a period of three consecutive years
from the conclusion of the 34th Annual General Meeting upto the conclusion of
the 37th Annual General Meeting to be held for the Financial Year 2023-24.
The Auditors' report for the FY 2022-23 annexed to the financial statement for the year
under review, does not contain any qualifications.
26. COST RECORDS AND COST AUDIT
Maintenance of cost records and requirement of cost audit as prescribed under the
provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the
business activities carried out by the Company.
27. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34(2) of the SEBI (Listing Obligations & Disclosure
Requirements) Regulations, 2015, the Management Discussion and Analysis Report forms part
of this Annual Report.
28. CORPORATE GOVERNANCE
As required under the Companies Act, 2013, Regulation 34 read with Schedule V of the
SEBI (LODR) Regulations, 2015 and RBI Master Directions for HFCs, 2021, the 'Report of
Directors on corporate governance' for the year FY 202223 is placed in this Annual Report.
The said Report covers in detail the Corporate Governance Philosophy of the Company,
Board Diversity, Directors appointment and remuneration, declaration by Independent
Directors, Board evaluation, familiarisation programme, vigil mechanism, etc. The
Auditors' Certificate on corporate governance is provided with this report as Annexure-4.
Business Responsibility & Sustainability Report
For the Financial Year 2021-22, the Company had voluntarily reported it's first
Business Responsibility and Sustainability Report (BRSR) as an annexure to the Report of
Directors forming part of the Annual Report. As per SEBI (LODR) Regulations, 2015, with
effect from the financial year 2022-23, the top 1000 listed entities (based on market
capitalization) shall mandatorily submit a Business Responsibility and Sustainability
Report (BRSR) describing the initiatives taken by them from an environmental, social and
governance (ESG) perspective, in the format as specified by SEBI from time to time. In
compliance with the said Regulations, the BRSR for FY 2022-23 is provided as a part of
this Report as Annexure-6.
Board Evaluation:
The Board of Directors has carried out an annual evaluation of its own performance,
performance of the Board committees and that of individual directors pursuant to the
provisions of the Act and SEBI Listing Regulations. In terms of Regulation 17(10) of the
SEBI (LODR) Regulations, 2015 read with the SEBI Circular No. SEBI/HO/CFD/ CMD/
CIR/P/2017/004 dated January 05, 2017, your Company has put in place the 'Board and
Director's Evaluation Policy' laying down a framework for evaluation of the Board, its
Committees and of the individual directors with defined attributes for evaluation. The
Board has evaluated the performance of the independent directors including their criteria
of independence as specified in the said regulations and their independence from the
management. The directors who were subject to evaluation did not participate in their own
evaluation. The results of the evaluation exercise were shared with the Board in
subsequent Board Meeting(s).
29. SAVE GREEN EFFORTS & RESPONSIBILITY TOWARDS SOCIETY
Can Fin Homes has always extended its support to the save green efforts mooted by the
Ministry of Corporate Affairs (MCA), Government of India. Minimising paper usage by
increasing data storage digitally, dispatch of Certificates/ information by way of mail to
the customers, utilization of solar energy to light the branches and for computer
operations, are few of our initiatives in this direction.
As in the previous years, the Company continues to publish only the statutory
disclosures in the print version of the Annual Report. Electronic copies of the Annual
Report, Annual General Meeting Notices and such other notices are being sent by e-mail to
all members whose e-mail addresses are registered with the Company/ RTA/ Depository
participants (DP).
Further, the relaxations provided under various MCA circulars issued from April 13,
2020 to December 28, 2022 and SEBI Circulars issued from March 12, 2020 to January 05,
2023 have been extended till September 30, 2023 and in compliance of the said circulars,
the Company had been sending Notices for the general meetings and Postal Ballot only
through e-mails to the addresses registered by the members with the Company/RTA/DP and the
general meetings have been conducted through VC/OAVM facility; and e-voting facilities had
been provided for remote e-voting as well as voting during the general meetings.
Hard copies of the said documents were sent to only those members and holders of
securities/persons who were eligible to receive the same and who had requested for the
same as prescribed under provisions of Companies Act and the SEBI LODR Regulations.
The Company has been discharging its Corporate Social Responsibility diligently and has
extended its support towards green initiatives and details are covered in para 22 of this
report.
30. OUTLOOK FOR 2022-23
Adherence to sound, ethical business practices will continue in the pursuit of
qualitative growth, with consistent focus on Asset Quality, Profitability and Liquidity.
While the Company will lend mainly to the salaried category, loans to the self-employed
and non-professional category of borrowers in safe geographies will be provided. Thrust
areas will be the affordable and mid-segment Housing.
The Company will follow its cost-conscious approach and will persistently monitor
collection efforts.
31. ACKNOWLEDGEMENT
Your Directors would like to thank Canara Bank, the promoter, for their continuous
support.
Your Directors would like to acknowledge the role of all its stakeholders viz.,
shareholders, debenture holders, CP holders, depositors, bankers, borrowers, arrangers,
insurance partners, Statutory and Branch Auditors, Secretarial Auditors, panel advocates,
panel valuers, agents and all others for their continuous support to your Company and the
confidence and faith that they have always reposed.
Your Directors acknowledge and appreciate the guidance and support extended by all the
Regulatory authorities including National Housing Bank (NHB), Reserve Bank of India (RBI),
Insurance Regulatory and Development Authority of India (IRDAI), Securities Exchange Board
of India (SEBI), Ministry of Corporate Affairs (MCA), Registrar of Companies, Karnataka,
Stock Exchanges, NSDL and CDSL.
Your Directors thank the Rating Agencies, viz. ICRA, CARE, India Ratings & Research
Ltd., (FITCH), the Registrars & Share Transfer Agents, Debenture Trustees and Trustees
of public deposits of your Company, Government(s), local/ statutory authorities, and all
others for their whole-hearted support during the year and look forward to their continued
support in the years ahead.
Your Directors value the professionalism of all the employees who have proved
themselves in a challenging environment and whose efforts have stood the Company in good
stead and taken it to present level.
|
For and on behalf of the Board of Directors |
|
Sd/- |
Place: Bengaluru |
K Satyanarayana Raju |
Date: June 19, 2023 |
Chairman |
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