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Housing & Urban Development Corporation Ltd.

BSE: 540530 Sector: Financials
NSE: HUDCO ISIN Code: INE031A01017
BSE 00:00 | 13 Apr 42.20 2.15






NSE 00:00 | 13 Apr 42.15 2.05






OPEN 40.70
VOLUME 207617
52-Week high 54.95
52-Week low 20.50
P/E 5.66
Mkt Cap.(Rs cr) 8,448
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 40.70
CLOSE 40.05
VOLUME 207617
52-Week high 54.95
52-Week low 20.50
P/E 5.66
Mkt Cap.(Rs cr) 8,448
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Housing & Urban Development Corporation Ltd. (HUDCO) - Director Report

Company director report

Dear Members

Your Directors have pleasure in presenting the 49th AnnualReport of the Company alongwith Company's Audited Financial Statements (standalone andconsolidated) for the financial year ended on 31st March 2019.


Ministry of Corporate Affairs (MCA) vide notification dated 30thMarch 2016 requires Non-Banking Financial Companies (NBFC) having net worth of र 500crore or more to comply with the Indian Accounting Standards (Ind-AS) for accountingperiods beginning on or after 1st April 2018 with comparatives for theperiods ending on 31st March or thereafter. As per notification Non-BankingFinancial Companies (NBFC) includes Housing Finance Companies.

Your Company being a Housing Finance Company is covered under Ind-Asw.e.f. 1st April 2018. In compliance to Companies (Indian AccountingStandards) Rules 2015 your Company has prepared its financial statement for thefinancial year 2018-19 with comparative figures for financial year 2017-18. The Companyhas adjusted the impact of transition from Indian General Acceptable Accounting Principalto Ind-AS in the opening reserve of 1st April 2017 and in the Statement ofProfit & Loss for the financial year 2017-18.

The important financial highlights for the year ended 31stMarch 2019 are tabulated as under:

(र in crore)
Particulars 2018-19 2017-18*
Revenue from Operations 5547.64 4171.36
Other Income 43.58 62.78
Total Income 5591.22 4234.14
Finance cost 3070.51 2294.79
Impairment on Financial instruments 327.27 270.81
Other Expenses including Employee Benefit Exp. 330.23 259.91
Total expenditure 3728.01 2825.51
Profit before tax 1863.21 1408.63
Current Tax 584.90 441.15
Deferred tax 98.78 (42.16)
Adjustment of tax of earlier years (Net) (0.62) (0.54)
Profit after tax 1180.15 1010.18
Other Comprehensive Income (4.46) 3.67
Total Comprehensive Income 1175.69 1013.85
Balance surplus of previous year 0.15 (81.40)
Less: Final Dividend for 2016-17 - 10.01
Less: Dividend Tax for 2016-17 - 2.04
Amount available for Appropriation 1175.84 920.40
Less: Appropriation
Transfer to surplus from general reserve - (95.00)
Transfer of Notional Gain as per Ind-As to General Reserve - 121.25
Transfer to Special Reserve u/s 36(1)(viii) of Income Tax Act 1961 and u/s 29C of NHB Act 1987 450.00 321.64
Transfer to Debenture Redemption Reserve 439.83 439.84
Transfer to Reserve for Bad & Doubtful Debt 86.86 -
Interim Dividend 135.13 110.10
Tax on Interim dividend 27.78 22.42
Net surplus after appropriations 36.24 0.15
Proposed final dividend @ र 0.15 per equity share 30.03 -
Tax on Proposed dividend 6.17 -
Surplus available after proposed Dividend of the current year 0.04 0.15
EPS (Basic/Diluted) (in ') 5.90 5.05

* Ind-As has been implemented in financial year 2018-19 with date oftransition being 1s April 2017 accordingly figures for financial year 2017-18have been reinstated/re-casted as per Ind-AS.

During the period under review your Company has performed extremelywell by witnessing a growth of 17 % in its Net Profits that has touched an all-time highof र 1180 crore from र 1010 crore in 2017-18. HUDCO has seen a 10 % growth in its networth that has reached र 10956 crore in 2018-19 from र 9943 crore in 2017-18 Revenue fromoperations also witnessed a jump of 33% to र 5548 crore in 2018-19 from र 4171 crore in2017-18.

In accordance with the provisions of Section 136 of the Companies Act2013 the audited standalone & consolidated financial statements and all otherdocuments required to be attached thereto are available on the Company's Website These documents shall also be available for inspection till the date of theensuing Annual General Meeting during business hours on all working days at the RegisteredOffice of the Company.


There were no such material changes and commitments occurredsubsequent to the close of financial year of the Company and the date of this Board'sreport affecting the financial position of the company and its state of affairs.


In compliance with Regulation 43A of Securities and Exchange Board ofIndia (Listing Obligations and Disclosures Requirement) Regulations 2015 your Companyhas formulated Dividend Distribution Policy and the same may be accessed at on Company's website.

In terms of Dividend Distribution Policy and DPE Guidelines yourCompany has paid an interim dividend of 6.75% i.e. र 0.675 per equity share having facevalue of र 10/- each totalling to र 135.13 crore (excluding dividend distribution tax of र27.78 crore) for the financial year 2018-19 which has been approved by the Board ofDirectors in its meeting held on 12th March 2019 and the same was paid to theshareholders.

Further the Board has also recommended payment of final dividend @1.5% i.e. र 0.15 per equity shares of र 10/- each for the financial year 2018-19 whichis subject to approval of the shareholders at the ensuing 49th Annual GeneralMeeting thereby making the total dividend for the financial year 2018-19 to 8.25% i.e.र 0.825 per equity shares. The total dividend payout for the financial year 2018-19 willbe र 165.16 crore excluding dividend distribution tax of र 33.95 crore.


As at 31st March 2019 the authorised share capital of theCompany stands at र 2500 crore divided into 2500000000 number of equity shares of र10/- each. The issued subscribed and paid up share capital of the Company was र 2001.90crore divided into 2001900000 number of equity shares of र 10/- each. During thefinancial year there has been no change in the authorized issued subscribed and paid upequity share capital of the Company. The Company has neither issued any shares withdifferential voting rights nor any Sweat Equity Shares during the year under report.

Under the divestment programme of the Government of India President ofIndia through the then Ministry of Housing and Urban Poverty Alleviation (now Ministry ofHousing and Urban Affairs) has divested 10.19% of the total paid up equity share capitalof the Company through Initial Public Offer in the year 2017.

As at 31st March 2019 89.81% of the shareholding is heldby the President of India through the Ministry of Housing and Urban Affairs (MoHUA) -69.08% and Ministry of Rural Development (MoRD) - 20.73% respectively and the balance10.19% is held by the Public.

The Government of India plans further divestment of its shareholding tothe extent of 10% of the total paid up capital of the Company with an option to retainoversubscription to the extent of 5% under green shoe option through an Offer forSale(OFS) of shares for which Department of Investment and Public Asset Management(DIPAM) has initiated various measures including appointment of various intermediaries.

Listing of Shares and Payment of Listing Fee

The Equity Shares of the Company continues to be listed on BSE Limitedand National Stock Exchange of India Limited. The Company has paid the annual listingfee(s) for the financial year 2019-20 to the above Stock Exchanges.

Transfer of unclaimed Dividend and Shares to Investor Education &Protection Fund

There is no amount of dividend remaining unpaid or unclaimed for aperiod of 7 years or more from the due date hence no amount / shares in respect theretohas been transferred to Investor Education & Protection Fund (IEPF) as per provisionsof Section 124 and 125 of the Companies Act 2013.


In terms of guidelines issued by Department of Public Enterprises(DPE) your Company has signed a tripartite Memorandum of Understanding(MoU) with itsAdministrative Ministry i.e. Ministry of Housing and Urban Affairs (MoHUA) and DPE forthe financial year 2018-19 your Company is expecting to witness an another year ofexcellent performance by getting an ‘Excellent' rating for the eighth consecutiveyear in a row for its performance on the MoU parameters.

These achievements have boosted the company's image in the CPSE sectorand in the overall business space and the same have been possible only with proactiveapproach untiring support and encouragement extended by the management and by theAdministrative Ministry.


During the year under report your Company has demonstrated its robustperformance both on operational and financial front by consistently facilitating inbuilding assets for the Nation through financing housing and infrastructure projects.

During the year HUDCO sanctioned loan amount of र 34452 crore anddisbursed र 31009 crore which shows a growth of 87% in 2018-19 from the previousfinancial year. On Cumulative front HUDCO since its inception in the year 1970 hassanctioned a total of 17197 housing and urban infrastructure projects with a total loanof र 195138 crore and disbursements of र 161110 crore. HUDCO has supported/facilitated more than 189.58 lakh (projects) dwelling units in the country in both ruraland urban areas so far thus making it the largest facilitator of the housing delivery inthe country. In addition under its Retail lending window HUDCO has sanctioned र 6798crore for 3.86 lakh individuals and released an amount of र 5132 crore.

Lending to BMTPC - to support flagship programme of Government of India

To support the Prime Minister Awas Yojna (Urban) a flagship programmeof Government of India your Company has extended loan of र 20000 crore raised by issueof ‘GoI Fully serviced Bonds' in tranches having tenor of 10 years with bulletrepayment on maturity and interest payable on semi-annual basis to Building Material andTechnology Promotion Council (BMTPC) an autonomous body of Ministry of Housing and UrbanAffairs Government of India to take loans on their behalf and disburse the same ascentral assistance to various States/Union Territories through Central Nodal Agencies forimplementation of PMAY(U) programme as Extra Budgetary Resources.

Housing Operations

During the year loan of र 27256 crore (inclusive of र 133 crore underthe HUDCO Niwas) has been sanctioned for housing sector facilitating construction of2068151 dwelling units out of which 1952660 dwelling units approximately 94.42% ofthe total dwelling units pertains to Economically Weaker Section (EWS)/ Lower IncomeGroup (LIG) categories. Further an amount of र 27415 crore (inclusive of र 28 croreunder the HUDCO Niwas) has been released during the year. The above amount ofsanctions/releases includes an amount of र 20000 sanctioned/released to BMTPC.

Further to support projects in the North-Eastern Region your Companyhas sanctioned 9 housing schemes with an amount of र 23.75 crore covering 170 units in theState of Nagaland.

Urban Infrastructure Lending

During the year HUDCO has sanctioned 55 proposals for financialassistance of र 7196 crore (inclusive of proposals for loan assistance of र 893 crore inNorth Eastern States) under different sectors like Water Supply Drainage Power SectorSocial Infrastructure Commercial Infrastructure Road & Transport etc. againstwhich an amount of र 3594 crore has been released.

During the first quarter of the financial year 2019-20 ended 30thJune 2019 Your Company has sanctioned a total loan of र 4211.08 crore and disbursed anamount of र 3838.88 crore.

Support to Government of India Flagship Programmes

HUDCO being an integral part of the Government of India Missionprogrammes is assisting the Ministry of Housing and Urban Affairs in scrutiny of PradhanMantri Awas Yojana - Housing for All (Urban) i.e. PMAY-HFA (U) projects. PMAY-HFA (U)Mission seeks to address the housing requirement of the urban poor including the slumdwellers through the 4 verticals programme of In-situ Slum Redevelopment (ISSR) (usingland as a resource) Credit Linked Subsidy Scheme (CLSS) Affordable Housing inPartnership (AHP) and Beneficiary Led Construction (BLC) - New Construction &Enhancement Projects.

Under Consultancy activities HUDCO is conducting desk & siteScrutiny of sample projects in respect of the 3 verticals of In-situ Slum RedevelopmentAffordable Housing in Partnership and Beneficiary Led New Construction and EnhancementProjects as and when required by the Ministry as the projects are being formulated andare sanctioned at the State Govt. level under all verticals except Credit Linked SubsidyScheme.

During the year under report HUDCO has undertaken site and DPRscrutiny of 125 projects with a total project cost of र 8362.59 crore and Central Share ofर 3057.12 crore for construction of 2.06 lac Dwelling Units in 20 States/ UTs. The above125 projects undertaken comprises of 4 AHP projects 115 BLC (NewConstruction/Enhancement) projects and 6 ISSR projects. From the above your Company hasgenerated fee-based income of र 2.64 crore.

Further PMAY also offers business opportunity to HUDCO in the form ofviability-gap funding wherein HUDCO offers loan assistance to State Governments/StateImplementing Institutions/Urban Local Bodies to meet the share of the State/ULB in thetotal project cost. During the year HUDCO has sanctioned viability-gap funds to 2 PMAY(U) projects with project cost of र 2147.48 crore in the State of Kerala and UnionTerritory of Andaman & Nicobar offering a total loan of र 1064.46 crore forconstruction of 50555 housing units.

As at 31st March 2019 HUDCO has conducted site inspectionsof 551 Night Shelters under Shelter for Urban Homeless (SUH) component of DeendayalAntyodaya Yojana - National Urban Livelihood Mission (DAY- NULM) in respect of 20states/UTs across the country.

HUDCO's role in Government of India Scheme - for promoting Housingfor All & Urban Development

To address the housing needs of the Urban Poor HUDCO as a CentralNodal Agencies (CNA) is making all out efforts to channelize the subsidy under CreditLinked Subsidy Scheme (CLSS) one of the components of prestigious programme of PradhanMantri Awas Yojana (PMAY-URBAN).

As at 31st March 2019 HUDCO has signed 86 number of MoUfor EWS/LIG and 80 number of MoU for MIG category with Primary Lending Institutions(PLIs). During the year a total of Rs 341.95 crore of subsidy has been disbursed to15675 number of beneficiaries for EWS/LIG/MIG category. On cumulative front HUDCO as CNAhad disbursed subsidy of र 404.36 crore to 19040 number of beneficiaries for EWS/LIG/MIGcategory since the inception of the programme i.e. June 2015.

Consultancy Initiatives

HUDCO's operations as a premier techno-financial institution are notonly limited to housing finance but also extended to other pertinent areas of Nationalimportance contributing to the cause of sustainable urban development. HUDCO has beeninvolved in showcasing various facets of fee-based consultancy services therebycontributing to the overall image building of HUDCO.

During the year Department of Municipal Administration Housing andUrban Development Government of Manipur has assigned a prestigious consultancy assignmentto HUDCO for preparation of Detailed Project Report (DPR) for construction of ShoppingComplex at Old District Hospital BT Road Imphal Manipur. HUDCO is in the process offinalizing the agreement with the Government of Manipur for the same.

Further HUDCO has added another prestigious consultancy project to itsrepertoire. The Government of Bihar has offered a consultancy assignment of preparation ofGIS based Integrated Master Plan for Rajgir Regional Planning Area and Nalanda MahaviharaWorld Heritage Site (WHS). Other activities with regard to Urban & Regional Planninginclude preparation of Development Plans for Khargone and Jhabua in the State of MadhyaPradesh.

In addition HUDCO is already working on various projects namelypreparation of DPR for Housing Project Under Atal Ashray Yojana at Girgaon Gwalior forMadhya Pradesh Housing Infrastructure Development Board and Vertical Housing Colony -Shehjar Apartments at Bemina Srinagar for Srinagar Development Authority.

During the year HUDCO has successfully completed the consultancyservices for construction of Office building for Archaeological Survey of India at TilakMarg New Delhi. The office building has been inaugurated by the Hon'ble Prime Minister ofIndia on July 12 2018 and named as ‘Dharohar Bhawan'.

HUDCO Design Awards 2018

HUDCO instituted Hudco Design Awards in 2012 to give recognition andfelicitate innovative ideas and initiatives that contribute to make our cites inclusiveliveable and environmentally sustainable. HUDCO Design Awards 2018 was announced inNovember 2018 and received an overwhelming response (97 entries received) from urbanprofessionals across the Country. The winners of the ‘HUDCO Design Awards 2018' werefelicitated on HUDCO's 49th Annual Day on 25th April 2019.

HUDCO also sponsors ‘HUDCO NASA Design Trophy' each year toencourage and appreciate young architecture students. The design theme for HUDCO-NASADesign Trophy 2019 was ‘Vibrant River Front'.


(i) Accounting Policies

During the year under report your company has made certainmodification/ additions in the existing accounting policies on account of implementationof Ind-AS in the Company effective from 1st April 2019. The abovemodification/additions in the accounting policies have no financial impact on thefinancial statements of the Company.

(ii) Income from Operations and Profitability

Your Company has reported total income for the financial year 2018-19at र 5591.22 crore inclusive of other income of र 43.58 crore. While the Profit before Tax(PBT) for the year was र 1863.21 crore and Profit after Tax (PAT) was र 1180.15 crore (र1010.18 crore in the previous year). Total comprehensive income for the year was reportedat र 1175.69 crore.

(iii) Non-Performing Assets

Your Company continues to provide top priority towards timelyrealization of its dues towards principal and interest etc. and has taken variousmeasures in the direction in compliance with the prudential guidelines for Non-PerformingAssets (NPAs) under the Housing Finance Companies (NHB) Directions 2010 as amended fromtime to time.

In order to improve operational and financial health of HUDCO yourCompany has taken various measures like regular monitoring of Default and NPA position byDefault Monitoring Committee (DMRC) and by a Committee for Review of NPAs a Board levelCommittee. During the year Regional Heads from 9 Regional Offices have given detailedpresentation with respect to default/NPA cases of their respective regions alongwithpossible recovery before the Committee for Review of NPAs.

During the year as a result of proactive approach and focused effortsof the management in the direction as on 31st March 2019 your Company hasbeen able to reduce Project Loan default by र 1157.45 crore i.e. 18.02% from the level ofर 6423.80 crore of the previous year. As on 31st March 2019 Loan overdue toNet Loan Assets ratio is 9.63% as against MoU target of 12.76%.

As at 31st March 2019 your Company's Gross NPA was र3286.59 crore constituting 4.48% to total loan portfolio. Further as against MoU targetof 1.40% Net NPA of your Company was र 354.28 crore constituting 0.50% of the net loanoutstanding. During the year 2018-19 an amount of र 781.13 crore was recovered from NPAaccounts which is the highest ever amount recovered from the NPA agencies in HUDCO. Themajor recoveries were from Maharaji Education Trust (र 316.69 crore) Electrosteel SteelLimited (र 164.74 crore) Kerala State Cooperative Hospital & CAMS Limited (र 161.90crore) Jalgaon Municipal Corporation (र 36.00 crore) and Malabar International AirportDevelopment Society (र 26.65

crore) and the remaining र 75.15 crore from other agencies. Out oftotal recovery of र 781.13 crore from NPA accounts an amount of र 528.94 crore is towardsinterest having direct impact on revenue from operations and र 252.19 crore is towardsprincipal recovery.

The Company has made provision on loans (Impairment) as per ECLApproach of र 2939.18 crore out of which the provision on account of loans (impairment)against NPA (Stage - III) is र 2932.31 crore.

As on 31st March 2019 total loan book of your Companyconstitutes 95.53% of loan to the Government Agencies and 4.47% to the Private Sector.HUDCO is not making any fresh sanctions to the private sector since March 2013. In thecase of loans to Government Sector the Gross NPA is र 125.67 crore against loan portfolioof र 70050.31 crore and provision has been made for the entire NPA amount. Whereas inPrivate Sector the Gross NPA is र 3160.92 crore against loan portfolio of र 3275.18crore and a provision of र 2806.64 crore has been made towards NPA.

(iv) Resource Mobilization

During the year under report your Company mobilized resourcesaggregating to Rs 8795.24 crore from diversified sources at market competitive rates.This comprised of र 4010 crore by way of Taxable Unsecured Redeemable NonConvertibleBonds and re-finance assistance of र 1500 crore availed from India Infrastructure FinanceCompany Limited (IIFCL). The Company also mobilized funds aggregating to र 3190.08 crorefrom various Indian Banks which included medium term loan(s) of र 2753.78 crore and US$denominated Foreign Currency loan of Rs 436.30 crore (US$ 65 million). The interest rateand currency risk in respect of the Foreign Currency Loan was hedged through Interest RateSwap and an Option Structure respectively. In addition to the above an amount of र 95.16crore (including renewals) was also mobilized through HUDCO Public Deposit Scheme duringthe financial year 2018-19.

Further for meeting Government of India's (GoI) funding requirement ofPradhan Mantri Awas Yojna (Urban) Scheme the Company during the year has also raised anaggregate amount of र 20000 crore in six tranches by issue of ‘GoI fully servicedBonds' on Private Placement basis. The repayment of Principal and interest on these Bondsshall be made by Government of India by making suitable budget provisions in the demand ofMinistry of Housing and Urban Affairs. With this the total long-term resources mobilizedduring the year aggregated to र 28795.24 crore. As on 31st March 2019HUDCO's long term borrowings to Net owned funds stood at 5.21 times as against 3.13times as on 31st March 2018.

For day to day operations the Company continues to follow prudentstrategy for optimum utilization of fund-based resources. To hedge any financial liquiditybottlenecks as on March 312019 ample credit lines to the tune of around र 9000 crorewere available with the Company from various scheduled Commercial Banks which did notbear any commitment charges towards unutilized amounts. Against these limits the CashCredit Facilities/Working Capital demand loan(s) availed and outstanding as on 31stMarch 2019 was र 552.85 crore. Further in addition to the above an amount of र 6400crore was also raised through issue of Commercial Paper(s) during the year. As on 31stMarch 2019 an amount of र 1800 crore was outstanding against Commercial Paper(s) whichhave since been redeemed on the respective date(s) as per the terms of borrowings. Withthis funds raised through Short term sources and outstanding as on 31st March2019 aggregated to र 2352.85 crore which comprised of Commercial paper(s) of र 1800crore & Working capital facilities of र 552.85 crore.

Accordingly total funds mobilized during the financial year 2018-19from various sources amounted to र 31148.09 crore which is the highest ever resourcesmobilized by the Company in a financial year ever since its inception.

(v) Credit Rating

• Domestic Rating

During the year your Company continues to enjoy the highest ratingsfrom three domestic Credit Rating Agencies namely M/s. India Rating and Research PrivateLtd. (IRRPL) M/s. CARE Ratings and M/s. ICRA Ltd in respect of its Domestic DebtInstrument(s)/Banking Sector loan(s)/facilities the details of which are as under:

Sl. No. Rating Agency Long Term Rating Short Term Rating
2 ICRA (ICRA) AAA/Stable (ICRA) A1 +

• International Rating

During the year HUDCO obtained International Ratings from twoInternational Rating Agencies namely Moody's Investors Services and FITCH Ratings forits International Borrowing Programme. Moody's and FITCH have assigned HUDCO a Long-TermForeign Currency Issuer Rating of "Baa2" & "BBB-" respectivelyat the Sovereign Ceiling with Stable Outlook. Both the assigned ratings are equivalent asthat of Republic of India.

(vi) Establishment of Medium-Term Note (MTN) Programme for HUDCO'smaiden/debut offering of Bonds in the Overseas Market

In its endeavour towards further diversification of its borrowingportfolio the Company has established Medium-Term Note (MTN) Programme of INR 50 Billionon Singapore Exchange Securities Trading Limited and Global Securities Market Segment ofIndia-INX (India's first International Exchange) for issuance of unsecured Bonds or anyother similar instruments whether denominated in Indian Rupee and/or Foreign Currency tobe issued in one or more tranches in the Overseas market under the ECB route.

(vii) Cost of Borrowings

The overall weighted average cost of resources raised during thefinancial year 2018-19 was 8.36 % p.a. and for borrowings outstanding as on March 312019was 8.04 % p.a. As a result the Company was able to deliver debt financing for variousHousing & Infrastructure projects spread across the Country at competitive rates.

(viii) Redemption of debt securities and repayment of loans (excludingthe borrowings availed and repaid during the same financial year)

During the year your Company has repaid a total sum of र 7554.20crore comprising of र 706.85 crore on account of long- term bonds र 71.56 crore onaccount of foreign currency loans र 3843.65 crore on account of loans from Banks andFinancial Institutions र 2500 crore on account of Commercial Paper(s) and र 432.14 croreon account of Public deposits matured/paid during the year.

Your Company continues to maintain its impeccable track record ofservicing its debt in time.

(ix) Unclaimed amount under HUDCO Bonds

Bonds amounting to र 87954415 (inclusive of interest amount of र72954414) in respect of 2692 bondholders remain unpaid during the year 2018-19 as thesame have not yet been claimed by the investors. The details of amount remaining unclaimedare as under:

(Amount in ')




Total Amount
Amount No. of holders Amount No. of holders
2016-17 12000000 9 51187256 1668 63187256
2017-18 22000000 10 47889541 1925 69889541
2018-19 15000000 5 72954415 2687 87954415

In respect of the above unclaimed Bonds the bond holder(s) have beenrequested from time to time through email/ letter etc. for submission of requisitedocuments for claiming the unclaimed amount.

In terms of section 125 of the Companies Act read with InvestorEducation and Protection Fund Authority (Accounting Audit Transfer and Refund) Rules2016 notified on 5th September 2016 during the year 2018-19 an amount of र1796949/- has been transferred to Investor Education and Protection Fund (IEPF).Further an amount of र 1500000/- towards principal and र 100000/- towards interesthas been claimed but remained unpaid as at the end of the financial year.

(x) Dematerialization of Bonds

Your Company has made necessary arrangement with National SecuritiesDepository Ltd. (NSDL) and Central Depository Services (India) Ltd. (CDSL) for issue ofbonds in dematerialized form. The company has also appointed Registrar & TransferAgents (RTA) for maintaining the continuous electronic connectivity with NSDL/CDSL andinvestors. During the year HUDCO has issued Unsecured Taxable Bonds in dematerializedform only. With this all Taxable Bonds issued by the Company and outstanding as on 31stMarch 2019 are in dematerialized form only.

Investors can deal in these bonds as per the provisions of DepositoriesAct 1996 as amended and such deals are cleared & settled in recognised StockExchanges subject to conditions specified by SEBI.

(xi) HUDCO Public Deposit Scheme

HUDCO being a Housing Finance Company registered with National HousingBank (NHB) is governed by the provisions of Housing Finance Companies (NHB) Directions2010 relating to Public Deposits.

During the financial year 2018-19 HUDCO has mobilized deposits of र95.16 crore (including renewals) from 798 depositors and an amount of र 432.14 crore wasmatured/paid to 1403 depositors. The total amount outstanding under HUDCO Public DepositScheme was र 289.62 crore from 1964 depositors as on 31st March 2019.

(xii) Unclaimed amount under HUDCO Public Deposit Scheme

As on 31st March 2019 deposit(s) amounting to र25780274/- (inclusive of Principal and Interest) from 50 depositors remains unclaimed.

In respect of unclaimed Deposits the Deposit holder(s) have beenrequested from time to time through email/ letter etc. for submission of requisitedocuments for claiming the unclaimed amount.

During the year an amount of र 83568/- remained unclaimed for morethan seven years from the date of maturity was transferred to the ‘InvestorEducation and Protection Fund' (IEPF) as per the provisions of the Companies Act 2013and rules made thereunder.

(xiii) Discontinuing acceptance/renewal of Public Deposit under the‘Public Deposit scheme'

In view of the cost benefit analysis with respect to cost of fundsraised through Public Deposit(s) vis-a-vis other sources of mobilization of funds and theprevailing competitive environment your company has decided to discontinue accepting/renewing Public Deposit under the Public Deposit Scheme w.e.f. 1st July2019.Further the maximum period for which deposits shall be accepted (upto 30thJune2019) has also been curtailed to 5 years as against maximum deposit acceptance periodof 7 years available earlier. However redemption of deposits already taken shall be madeon due date(s).

(xiv) Deployment of Resources at the close of the year

At the close of the financial year 2018-19 the total resources of yourCompany stood at र 72829.34 crore. Out of this Equity Share Capital amounted to र2001.90 crore Reserves & Surplus stood at र 8953.87 crore Loans from FinancialInstitutions Commercial Banks Multilateral Institutions and Market Borrowings throughBonds and Commercial paper accounted for र 59847.96 crore Deferred Tax Liabilities (Net)amounted to र 404.24 crore and other liabilities & provisions stood at र 1621.37crore. These funds were deployed as Long/Short Term Loan & Advances of र 71338.22crore Fixed Assets (net of depreciation) of र 109.16 crore (including capitalwork-in-progress) Investments of र 535.51 crore Cash & Bank Balances of र 340.04crore and other assets of र 506.41 crore.


Your Company has implemented an integrated risk management approachthrough which it reviews and assess significant risks on a regular basis to ensure thatthere is a robust system of risk controls and mitigation in place. Major risks identifiedfor your company being in lending operations are credit risk operational riskliquidity risk market risk interest rate risk and foreign currency risk etc. YourCompany has a well-structured robust Risk Management Policy and Operating Manual in linewith its objectives to address the various risks.

In compliance with the SEBI(LODR) Regulations2015 your Company has inplace a Board level Committee under the nomenclature ‘Risk Management Committee'(RMC) headed by an Independent Director which reviews various decisions/ recommendationsof the three sub-committees namely:

• Assets & Liabilities Management Committee (ALCO);

• Credit Risk Management Committee (CRMC); and

• Operational Risk Management Committee (ORMC)

Assets and Liabilities Management (ALCO) meeting reviews the liquidityrisks and ensures management of Assets and Liabilities mismatches through liquidity gapanalysis interest rate sensitivity analysis. The Assets Liabilities mismatch if any arebeing managed through the committed Bank lines within the permissible limits as per NHBguidelines. During the year 20 number of ALCO meetings were held.

The Credit Risk Management Committee (CRMC) oversees and ensures thatthe credit policies are put in place and are consistently applied while appraising theproposal for sanction of loan and for ascertaining the credit worthiness of the applicant/borrowing agency. During the year 4 meetings of the CRMC were held.

The Operational Risk Management Committee (ORMC) oversees and ensuresthe mitigation of operational risk both internal as well as external like Technologyrisk Employee risk Customer risk Capital Asset risk and External risk etc. to whichyour company is susceptible by establishing & strengthening internal control systemsand procedures and by providing adequate training to the employees. During the year 4meetings the ORMC meetings were held.

With the prudent policies and professional approach of the managementHUDCO has been successful in mitigating various risks briefly described as under:

a) Credit Risk

To manage credit risks associated with business your Company has inplace a strong and effective credit appraisal mechanism containing comprehensive appraisaltechniques/ guidelines ensuring timely repayments of principal & interest amount.

b) Operational Risk

To manage the operational risks both internal as well as externalassociated with the operations of the Company like technology risk employee risk capitalasset risk external risk compliance risks viz. external fraud legal risk etc. yourCompany has established a strong reporting and monitoring mechanism. The requisiteinformation on the Operational risk is obtained through quarterly reports of‘Operational risk Factors and Key Risk Indicators (KRIs)' from Regional Offices/departments which are further reviewed and analysed for mitigation of operational risk.

c) Liquidity Risk

For management of liquidity risk your Company has effective AssetLiability Management System. The liquidity risk is being monitored with the help ofliquidity gap analysis. Further the funds are mobilized at competitive rates throughvarious strategies viz. bonds public deposits term loans etc. and the mismatch in theAsset and Liabilities if any are managed through the committed Bank lines.

d) Market Risk

The various market risks arising from fluctuations in interest ratesand foreign currency exchange rates are periodically reviewed by the Company. Furtherbased on cost of funds and market scenario the lending rates are determined. The interestrate risk is being monitored with the help of interest rate sensitivity analysis under theAsset Liability Management System.

e) Foreign Currency Risk

The Company has a Foreign Currency Risk Management policy formitigation of risks associated with Foreign Currency fluctuations. To cover the risksassociated with exchange rate and interest rate your Company has entered into hedgingtransactions. As on 31st March 2019 the total foreign currency liabilitiesare USD 109.12 million and JPY 1716.38 million and 79% of the foreign currency exchangerate risk is covered through hedging instruments.


As on 31st March 2019 HUDCO has three Joint VentureCompanies(s) namely

a) Shristi Urban Infrastructure Development Ltd. (SUIDL)

b) Pragati Social Infrastructure & Development Ltd. (PSIDL) and

c) Signa Infrastructure India Ltd. (SIIL)

Further there is one associate namely Ind Bank Housing Limited. YourCompany do not have any Subsidiary Company.

As at 31st March 2019 the total investment in jointventure companies stood at र 2.14 crore {SUIDL - र 2.00 crore (40%) PSIDL - र 0.13 crore(26%) and SIIL - र 0.01 crore (26%)}.

In view of non-satisfactory performance of these joint venturecompanies your Company in the year 2015-16 has decided to exist from these jointventures by invoking the exit clauses. The Company has initiated the steps for exitingfrom these joint ventures.

In the case of an associate Company namely Ind Bank Housing Limitedyour company has made an investment of र 2.50 crore in its equity being 25% of thepaid-up equity share capital. HUDCO has provided for full diminution in the value ofinvestment made in IBHL.


Pursuant to Section 129(3) of the Companies Act 2013 your Company hasprepared Consolidated Financial Statement (CFS) in respect of only one Joint VentureCompany namely M/s Shristi Urban Infrastructure Development Limited and appropriatedisclosure stating the reasons relating to non-consolidation of accounts of other threecompanies have been given in the CFS.

Consolidation in respect of other Joint Venture(s) namely PragatiSocial Infrastructure Development Limited (PSIDL) Signa Infrastructure India Limited(SIIL) has not been considered during the financial year 2018-19 as your Company hasdecided to exist from these Joint ventures and has reflected the investment in thesecompanies at the notional value of र 1/- only in its annual accounts for the financialyear 2018-19 instead of its original cost/ fair value of investment. Further in case ofIBHL (Associate) the Company has provided for full diminution in the value of investment.

Statement containing salient features of Financial Statements of JointVenture and Associate Companies

Pursuant to Section 129(3) of the Companies Act 2013 a Statementcontaining salient features of financial statements of Joint Venture and AssociateCompanies has been given in the prescribed format AOC - 1 and is annexed as part of thefinancial statements.


Pursuant to Section 143(3)(i) of the Companies Act 2013 the Companyhas ‘Internal Financial Control' Policy which gives broad framework of differentactivities with policies and procedures and has put in place Internal Financial Controls(IFC) for ensuring the orderly and efficient conduct of its business adherence with thelaid down policies and procedures safeguarding assets of the Company prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information which is commensurate withthe operations of the Company.

In addition to Internal Financial Control Policy the Company hasprepared Risk Control Matrices and Process Flow Charts which are helpful form ofdocumentation to depict the process to initiate authorise process record and reporttransactions; the points within the process at which misstatements could occur; andcontrol activities that are designed to prevent or detect such misstatements includingproviding greater transparency to segregation of duties. These diagrams also depict therelevant systems and Information Produced by the Entity (IPE).

The Review and Testing of the Operating efficiency of existing InternalFinancial Controls and updation/modification of existing Risk Control Matrix and FlowCharts has been carried out by a Chartered Accountant firm which has tested the overallcontrols and found them satisfactory and working effectively during the year. Being acontinuous process appropriate steps have been taken for further strengthening the IFC.

Internal Audit

In order to strengthen the Internal Audit and Control System CharteredAccountant Firms have been appointed at Regional Office to conduct Internal Audit. Duringthe year under review internal audit of all the Regional Offices and major divisions ofCorporate Office were carried out by in-house internal audit team and by outsourcedChartered Accountants Firms. The significant observations of the internal audit wereperiodically submitted to the Audit Committee and necessary action as directed by theAudit Committee is taken by the Internal Audit Department. Directions have also beenissued to all concerned for adherence to the policies guidelines and procedures and fortimely compliance of the Audit Observations.


During the year under report your Company has initiated variousmeasures towards implementation of Integrated Solution/ Enterprise Resource Planning(ERP) as part of digital transformation program with emphasis on IT security for whichvarious intermediaries have been appointed. This proposed system is robust and is based oncontemporary technology for business growth and operational efficiency.

On successful implementation your Company will reap benefits like -Centralized Information for better decision-making & support system complete digitalautomation & optimization of business operations improved credit rating for businessperformance cost saving with faster accurate & timely data processing improvedcustomer/stakeholder relation services.


HUDCO is an ISO 9001:2015 certified company for its Business activitiescovering project and Retail Financing Services Resource Mobilisation for fundingConsultancy and Training Research & Networking through Human Settlement Planning andManagement optimizing organizational efficiency and introducing elements of robust riskframework and customer focus for continual improvements of system and processes. Thecertificate has been received from National Accreditation Board for Certification Bodies(NABCB)/United Accreditation Service (UKAS) through M/s United Registrar of Systems (URS)Certification Ltd. on 14th September 2018 for a period of three years validupto 14th September 2021.


During the year under report Human Settlement Management Institute(HSMI) a Research & Training Wing of HUDCO has undertaken 16 Training Programmesimparting capacity building training to 504 professionals with a total of 4103 man-days asunder:

a) 3 International Training Programmes namely ‘Planning &Designing Aspects of Smart Cities' ‘Formal Solutions of Informal Settlements' and‘Planning & Management of Sustainable Infrastructure' of six weeks each fullysponsored by the Ministry of External Affairs Government of India under its ITECprogramme covering a total of 80 officers/ professionals from 42 Countries;

b) 1 training programme namely ‘Good Governance' sponsored by TCPOof 3 weeks for TCPO Socio-Economic Cadre Officers attended by 17 officials;

c) 11 In-house training programmes for HUDCO officials in thediscipline of Law Finance Projects IT and others on various topics like NCLT Ind-ASGST Digital Payment Succession Planning Policy ISO. etc. participated by 381officials imparting training of 596 man-days ; and

d) 1 training programme with CITYNET Indian national Chapter members on"Sustainable Waste Management Practices" of 2 days attended by 26 participants.

HUDCO's HSMI has been engaged with CITYNET through its research andtraining activities since 1993. HUDCO has also established an India chapter of CITYNETso that more Indian cities could benefit from HUDCO's vast experience in the area ofcommon interest.

During the year under the collaborative Research & Developmentactivities HSMI has organized 6 seminars for presentations of Research Study Reports and6 Research Studies were completed. Cumulatively out of 35 research projects sanctionedduring the period from 2012-2017 under HUDCO R&D Policy a total of 21 researchprojects have been completed so far.

As part of HUDCO Best Practices Awards to improve the livingenvironment in the Habitat Sector 10 ‘Best Practices Awards' and 6‘Certificates of Appreciation' were given to agencies on the HUDCO Annual Day forundertaking unique/novel projects/schemes in the categories of Urban Governance HousingUrban Poverty & Infrastructure Urban Transport Sanitation Environment ManagementEnergy Conservation & Green Building Urban Design & Regional Planning Inner CityRevitalization & Conservation and Disaster Preparedness Mitigation &Rehabilitation after recognising their potential for replication and adaptation by otheragencies in the Country.


Your Company has undertaken a major initiative of implementing(Enterprise Resource Planning) ERP system including the HR Module. This will bring in moreprofessionalism in the working of HR besides automating various HR processes and will alsobe extremely helpful in talent management leading to an overall improvement in businessperformance.

To enhance the skills of the employees in the competitive dynamicbusiness environment 301 employees were imparted training during the year in differentspheres of company's activities. This was done through our in-house Training Centre i.e.Human Settlement Management Institute (HSMI) as well as by nominating the officers torenowned Institutes/Organisations. In terms of man-days such training works out to 871man-days.

The aggregate manpower of the Company as on 31st March 2019stood at 827 comprising 3 Board level Functional Executives including of Chairman &Managing Director 1 Chief Vigilance Officer 676 Executives and 147 Non-executives. Outof this women employees constituted 29.86% of the total manpower.

Company maintains healthy cordial and harmonious industrial relationsat all levels.


Your Company has continued its emphasis on effective implementation ofCentral Vigilance Commission (CVC) Government of India guidelines in a fair andtransparent manner for eradicating corruption and contributing towards building a newIndia.

Your Company continues its efforts of creating awareness among theemployees at all levels of the possible areas of eradicating corruption/financialirregularities through the system of e-procurements; e-payments; adoption of IntegrityPact wherever applicable; digitalization of system/process to avoid manual interventionetc.

During the year Vigilance Department of the Company has undertookpreventive checks through routine and specific inspection of selective Regional Officeswherein random check of various activities at Regional Offices and specific examination ofcertain cases has been carried out in a transparent manner.

Based on the theme - ‘Eradicate Corruption - Build a new India' asdeclared by Central Vigilance Commission (CVC) Government of India your Company observed‘Vigilance Awareness Week' from 29th October to 3rd November2018 in its Head Office as well as at all the Regional Offices and organized variousawareness programmes in schools & colleges and other prominent places throughout thecountry.


During the year under report your Company took various initiatives forprogressive use of Hindi in official work. From 4th September to 18thSeptember 2018 ‘Rajbhasha Pakhwara' was celebrated by your company in its HeadOffice and all Regional Offices spread throughout the country wherein variouscompetitions and workshops relating to progressive use of Hindi were organized and prizeswere awarded to the winners. Further a two days special Hindi Workshop was also organizedin the month of November 2018 in DINDI District Vijayawada Andhra Pradesh to encourageprogressive use of Hindi in official work among ‘C' Region officials.

During the year Parliamentary Committee on Official Language inspectedour Thiruvananthapuram and Bhopal Regional Offices and the Committee expressed itssatisfaction over the progressive use of Hindi in these offices. It is also referential tomention that our Thiruvananthapuram Regional Office has received third prize from itsconcerned Regional Implementation Office for the best execution of Official Languagepolicy in the office.

Further a team of Hindi Officials from Ministry of Housing and UrbanAffairs Government of India also inspected HUDCO Bhubaneswar Regional Office and RegionalImplementation Office (West) inspected our Mumbai Regional Office. Both teams haveexpressed their satisfaction over the use of Hindi in official work by these RegionalOffices.

During the year Town Official Language Committee (Tolic/Narakas)Delhi Upkrm-2 organised various Hindi progressive programmes like Delhi Narakas SammelanHindi technical training programme/seminar/workshop Hindi competitions and half yearlymeetings for the implementation of Hindi in 49 member offices (PSU's) located at Delhi asper targets set by Department of official Language Ministry of Home Affairs Governmentof India.


Disclosure under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013

In compliance of the ‘Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 HUDCO has in place an ‘InternalComplaints Committee' for redressal of complaint(s) against sexual harassment of womenemployees which is headed by a senior level woman official of the Company. Anti-sexualharassment stance of the Company is also outlined in HUDCO (Conduct Discipline andAppeal) Rules.

During the year under report one complaint was received and the samewas duly disposed of by the Internal Complaints Committee during the year and no complaintwas outstanding at the end of the year.

Public Grievance Redressal Mechanism of HUDCO

HUDCO has been following guidelines laid down by Government of Indiaand National Housing Bank for redressal of public grievances and has an appropriate PublicGrievance Redressal Mechanism for redressal of grievances received on Centralized PublicGrievance Redress and Monitoring System (CPGRAMS) portal of Department of AdministrativeReforms & Pubic Grievances Ministry of Personnel Public Grievances & PensionGovernment of India and Grievance Registration & Information Database System (GRIDS)portal of National Housing Bank.

Implementation of Micro Small & Medium Enterprises (MSME) Policy

Your Company is following the guidelines in respect of PublicProcurement Policy for Micro and Small Enterprises issued by the Government of India videMicro and Small Enterprises (MSEs) Order 2012.

During the year 2018-19 HUDCO has made procurement amounting to र 5.98crore from MSEs (including MSEs owned by SC/ ST entrepreneurs) constituting 41.01% oftotal annual procurement. Further in compliance of notification which came in the monthof November 2018 HUDCO has made procurement from women entrepreneurs amounting to र0.0315 crore constituting

0.21% of the total procurement. The Company has made all the paymentsdue to MSME's within the stipulated time period and there has been no delay.

Right to Information Act

In compliance with the provisions of Right to Information Act 2005all matters pertaining to RTI has been dealt by your Company without any compromise inmaintaining transparency and efficiency.

HUDCO has secured ‘A' Grade in the Transparency Audit ofDisclosures under section 4 of the RTI Act by Public Authorities conducted by CentralInformation Commission in 2018. All the RTI Applications and Appeals received during theyear have been responded within the prescribed time limit as per RTI Act 2005.

There have been no instances of non-compliances by the Company. Nopenalties or strictures were imposed on the company by any Statutory Authority duringlast three years with respect to RTI.


Pursuant to the provisions of Section 134 (5) of the Companies Act2013 it is confirmed that:

a) in preparation of the annual accounts the applicable accountingstandards have been followed and no material departures have been made from the same;

b) such accounting policies have been selected and applied consistently(except for changes in accounting policies as disclosed in the Note to Accounts to theFinancial Statements) and made judgments and estimates that are reasonable and prudent soas to give a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for that period;

c) proper and sufficient care has been taken for the maintenance ofadequate accounting records in accordance with provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

d) the annual accounts have been prepared on a ‘going concern'basis;

e) the Company has laid down Internal Financial Controls to be followedand such internal financial controls are adequate and were operating effectively; and

f) Proper systems have been devised to ensure compliance with theprovisions of all applicable laws and such systems were adequate and operatingeffectively.


The Management Discussions & Analysis Report for the year ended 31stMarch 2019 as stipulated in Securities and Exchange Board of India (Listing Obligationsand Disclosures Requirement) Regulations 2015 is annexed and forms part to this report.


The Corporate Governance Report which forms part of this Report is setout as separate annexure together with the certificate from Malhotra Arora &Associates Company Secretaries regarding compliance of the conditions of CorporateGovernance as stipulated in the SEBI (LODR) Regulations 2015 and DPE guidelines.


The ‘Business Responsibility Report' for the year ended 31stMarch 2019 as stipulated under Regulation 34(2) of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosures Requirement) Regulations 2015 is annexed andforms part to this report.


HUDCO being a Government Company the power to appoint Chairman &Managing Director Whole Time Directors Government Nominee Directors and IndependentDirectors on the Board of your Company are vested with the President of India which areexercised through the Administrative Ministry i.e. Ministry of Housing and UrbanAffairs Government of India.

During the year under report following changes took place in thecomposition of the Board of Directors:

a) Shri Amrit Abhijat (DIN: 03022727) Joint Secretary (HFA) Ministryof Housing and Urban Affairs has been appointed as Part-time Official Director vice ShriRajiv Ranjan Mishra with effect from 1st June 2018 on the Board of the Companyby the Administrative Ministry vide order No. 42021/39/2017-AA (E-9026701) dated 1stJune 2018. Further appointment of Shri Abhijat has been confirmed/approved by theshareholders in its 48th Annual General Meeting held on 25thSeptember 2018;

b) Shri Nand Lal Manjoka ceased to be Director (Corporate Planning) onattaining the age of superannuation on 30th November 2018 as per terms andconditions of his appointment;

c) Shri Muniappa Nagaraj (DIN: 05184848) has been appointed as Director(Corporate Planning) by the Administrative Ministry vide its Order No.A-42012(12)/2/2017-AA-UD (E-9033193) dated 28th December 2018 for a period offive years from the date of his assumption of charge of the post or till the date of hissuperannuation or until further orders whichever is the earliest. Shri Nagaraj hasassumed the charge of the post with effect from 1st February 2019. He wassubsequently appointed as an Additional Director in compliance of Section 161 of theCompanies Act 2013 and Articles of Association of the Company.

d) Shri Shyam Sunder Dubey (DIN: 06601151) Joint Secretary &Financial Advisor Ministry of Housing and Urban Affairs Government of India has beenappointed as Part-time Official (Government Nominee) Director in place of Smt. JhanjaTripathy with effect from 8th August 2019 on the Board of the Company by theAdministrative Ministry vide order F.No. A-42012(12)/39/2017-AA(E-9026701) dated 8thAugust 2019. He was subsequently appointed as an Additional Director in compliance ofSection 161 of the Companies Act 2013 and Articles of Association of the Company.

Further approval of the shareholders is being sought at the 49thAnnual General Meeting for confirmation/ approval of appointment of Shri M Nagaraj andShri Shyam Sunder Dubey as Director(s) on the same terms and conditions as approved by thePresident of India.

In accordance with the provisions of Section 152 of the Companies Act2013 [including any statutory modification(s) or reenactments) thereof for time being inforce read with the applicable rules as amended] and Articles of Association of theCompany Shri Rakesh Kumar Arora (DIN: 02772248) Director Finance being longest inoffice among the Directors who are liable to retire by rotation retires by rotation atthe ensuing Annual General Meeting and being eligible offers himself for reappointment atthe ensuing Annual General Meeting.

After the closure of the financial year under report Shri Mukesh M.Arya Prof. Chetan V. Vaidya and Shri Amarishkumar G .Patel Part-time Non-Official(Independent) Director(s) and Smt. Jhanja Tripathy Part-time official (Government Nominee)Director ceased to be Directors on the Board of the Company as per terms and conditions oftheir appointment.

Your Board placed on record its sincere appreciation for the valuablecontribution made by Shri Nand Lal Manjoka Shri Mukesh M. Arya Prof. Chetan V. VaidyaShri Amarishkumar G Patel and Smt. Jhanja Tripathy during their tenor of directorship withthe Company. Further your Board extended a warm welcome to Shri M. Nagaraj and Shri ShyamSunder Dubey for being part of HUDCO Board.

Your Directors recommend the appointment/re-appointment of the abovesaid Directors at the ensuing Annual General Meeting.

Pursuant to the provisions of Section 149(6) of the Companies Act andRegulation 16(1)(b) of the SEBI (LODR) Regulations 2015 all the Part-time Non-officialIndependent Directors have given their declarations as to their Independence.

None of the Directors of your Company are related to each other andbased on the confirmations received from them none of them are disqualified for beingappointed/ reappointed as directors in terms of Section 164 of the Companies Act 2013 andother applicable laws if any.

HUDCO being a Government Company the appointment and performanceevaluation of Directors are done by the Administrative Ministry being the appointingauthority.

As on 3181 March 2019 the details of Key ManagerialPersonnel including changes occurred during the year are as under:

Sl. No. Name of Key Managerial Personnel Designation
1. Dr. M. Ravi Kanth Chairman & Managing Director
2. Shri Rakesh Kumar Arora Director (Finance) & Chief Financial Officer
3. Shri Muniappa Nagaraj (from 1.2.2019) Director (Corporate Planning)
4. Shri NL Manjoka (upto 30.11.2018) Ex- Director (Corporate Planning)
5. Shri Harish Kumar Sharma Company Secretary


Pursuant to section 204 of the Companies Act 2013 and rules madethereunder the Company has appointed M/s Malhotra Arora & Associates CompanySecretaries in practice to undertake the Secretarial Audit for the financial year2018-19. The Secretarial Auditors have referred to certain observations in their reportwhich are self-explanatory and do not require further clarification.


M/s Prem Gupta & Co. Chartered Accountants (Firm Reg. No.000425N) New Delhi appointed as Statutory Auditors by the Comptroller and AuditorGeneral of India (CAG) under section 139 of the Companies Act 2013 had conducted theaudit of the Financial Statements (both Standalone and Consolidated) for the financialyear 2018-19 and submitted their report thereon. The Statutory Auditors of your Companyfor the financial year 2019-20 are yet to be appointed by the Comptroller and AuditorGeneral of India (CAG).

The comments of the Statutory Auditors on the financial statementalongwith management reply thereto are annexed and forms part of the report.

Comments of Comptroller and Auditor General of India (CAG)

The Comptroller and Auditor General of India (CAG) vide their letter(s)dated 23rd July 2019 has given ‘NIL Comments' on the audited financialstatements (consolidated and standalone) for the financial year 2018-19 under section 143of the Companies Act 2013 and the same are annexed hereto forming part of the AnnualReport.


(i) Corporate Social Responsibility Committee

In compliance with the provisions of Section 135 of the Companies Act2013 your Company has in place ‘Corporate Social Responsibility' Committee of theBoard. As on 31st March 2019 the Committee consists of five member(s) namely:Dr. M. Ravi Kanth as Chairman Shri Mukesh M. Arya Prof. Chetan V. Vaidya ShriAmarishkumar G. Patel and Dr. Sudip Kumar Nanda.

Further after closure of financial year the Committee wasreconstituted and the present composition of the Committee comprises of Dr. M. Ravi Kanthas Chairman Smt. Pratima Dayal and Dr. Sudip Kumar Nanda as members.

The Committee is headed by Chairman & Managing Director and theremaining 2 members are Part-time Non-official (Independent) Directors. The constitutionof the Committee is in compliance with the provisions of the Companies Act 2013.

Your Company has in place Corporate Social Responsibility Policy (CSRPolicy) which inter-alia lays down the guidelines and the activities to be undertaken bythe Company and the same is available at:

The Company has spent/released an amount of र 4.58 crore on CSRactivities during the year under review however based on utilization certificatereceived from the agencies an amount of र 4.20 crore has been booked as an amountutilized in the financial statements during the year 2018-19.

The Company has not been able to spend the whole of the amountearmarked for CSR activities; the reasons for the same were disclosed in the AnnualReport(s) of the respective financial year(s). The Annual Report on CSR activities for thefinancial year 2018-19 is annexed hereto forming part of the Annual Report.

(ii) Board and its Committees

The detailed composition of the Board and its various Committees theirscope and terms of reference number of meetings of the Board/ Committees held during theyear and attended by directors/members of the Board/ Committees alongwith otherparticulars are given in the annexed Report on Corporate Governance Report.

(iii) Particulars of Loans Guarantee or Investments

Your Company being a Housing Finance Company the provisions of section186 of the Companies Act 2013 with respect to loan made guarantee given or securitiesprovided in its ordinary course of business are not applicable to the Company hence thedisclosure pertaining thereto have not been given. Further detail of investments made bythe Company are disclosed in the financial statements for the year 2018-19.

(iv) Extract of Annual Return

Pursuant to Section 92(3) of the Companies Act 2013 read with therules made thereunder the extract of Annual Return as at 31st March 2019 isannexed and forms part to this report and may be accessed at Company Website

(v) Energy Conservation Technology Absorption and Foreign ExchangeEarning & Outgo.

a) Conservation of Energy

Your Company being a Housing Finance Company is in lending operationshence the area of operations in which it operates is not energy intensive.

Your Company has strong commitment towards conservation of energy andnatural resources. For conservation of energy both at its Head Office and its RegionalOffices your Company has taken number of initiatives in the direction like replacement ofCFL with LED lights maximum use of natural lights in its day to day operations andreplacement of high power consuming equipments with low energy consuming equipments andinstallation of solar panels etc.

All these efforts have resulted in power saving both in terms of itsusage and cost.

b) Technological Absorption

During the year under report your Company has not absorbed anytechnology indigenous/ imported. Further no technology was imported during the last threeyears.

Your Company has formulated a Research & Development (R&D)Policy in line with the guidelines issued by the Department of Public Enterprises (DPE)vide OM dated 20th September 2011. As per R&D guidelines of DPE an amountof र 3.995 crore has been earmarked for the financial year 2018-19 out of which anamount of र 0.67 crore has been spent on R&D activities and balance amount of र 3.325crore has been kept as non-lapsable budget.

c) Foreign Exchange Earnings and Outgo

The inflow on account of foreign exchange transaction was र 2.99 crore(previous year र 2.32 crore) while foreign exchange outgo/ expenditure was र 7.93 crore(previous year र 6.04 crore).

(vi) The provisions of Section 197 read with rules on Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are not applicable toyour Company as the Ministry of Corporate Affairs vide notification dated 5thJune 2015 has exempted Government Companies from compliance of Section 197 with respectto the remuneration drawn by employees/ directors accordingly the same have not beengiven;

(vii) During the year under review there was no contract orarrangement entered into by the Company in accordance with the provisions of Section 188of the Companies Act 2013. All the existing related party transactions during thefinancial year were on an arm's length basis and were in the ordinary course of business.There are no materially significant related party transactions made by the Company whichmay have a conflict with the interest of the Company.

(viii) The Company is in compliance with all the applicable SecretarialStandards.

(ix) There is no change in the nature of business of the Company duringthe year;

(x) No significant and material orders were passed by the regulators orcourts or tribunals which impact the going concern status and Company's operations infuture.

(xi) Board of Directors of HUDCO are appointed by the President ofIndia through the Administrative Ministry and their performance is being evaluated by theMinistry itself hence the requirement of carrying out formal annual evaluation by theBoard of its own performance and that of its committees and individual directors is notapplicable as per Ministry of Corporate Affairs notification dated 5th June2015.

(xii) Company's Policy on Directors' appointment and remunerationincluding criteria for determining qualifications positive attributes independence of adirector and other matters provided under Section 178(3) are not applicable to yourCompany as per notification dated 5th June 2015 issued by the Ministry ofCorporate Affairs.

(xiii) No material case of frauds by the Company or on the Company byits Officers or Employees has been reported by Auditors under Section 143(12) of CompaniesAct 2013 hence disclosure under section 134(3)(ca) of the Act is not required.

(xiv) The Board of Directors of your company has laid down Code ofConduct and Ethics for all Board members and Senior Management Personnel and the same isplaced on the Company's website. All the Board members and Senior Management personnelhave affirmed compliance with the Code. The copy of the declaration made by Chairman &Managing Director is annexed and forms part of this report.

(xv) In compliance with Regulation 25(10) of the SEBI (LODR)Regulations 2015 the Company has obtained Directors and Officer Liability InsurancePolicy to ensure adequate insurance coverage which covers all Directors of the Company

i.e. Functional/Government Nominee and Independent Director KeyManagerial Personnel Officers at level Executive Directors and above HoDs RegionalHead/Chiefs irrespective of their designation against the risk of financial lossincluding the expenses pertaining to defence cost and legal representation expensesarising in the normal course of business.


HUDCO is one of the leading institutions in the public sectorsupporting the housing housing related infrastructure and other infrastructuredevelopment initiatives in the Country. With the various flagship programme(s) ofGovernment of India in the Housing and Urban development sector being in activeimplementation mode it is logical that HUDCO's role contribution and associatedfinancial strength would continue in the coming years and HUDCO would continue tostrengthen its position as a reliable institution for country building initiatives. Itsability to provide comprehensive support for technical appraisal/scrutiny of detailedproject reports taking up site-inspections wherever required and providing loanassistance as viability gap funding to States and their agencies to meet the State/UTs/ULB share of project cost together make it a unique institution for comprehensive supportfor programme implementation.


The various information required as per the Companies Act 2013Securities and Exchange Board of India (Listing Obligations and Disclosures Requirement)Regulations 2015 and DPE guidelines are annexed to this report are as under:

Particulars Annexure
Management Discussion & Analysis Report 1
Corporate Governance Report 2
Business Responsibility Report 3
Secretarial Auditor's Report 4
Independent Auditor's Report and Management Reply to the comments/ observations thereon 5
Comments of Comptroller and Auditors General of India 6
Annual Report on CSR Activities 7
Extract of Annual Return 8
Declaration of the Code of Conduct 9


Your Directors are pleased to place on record their sincere gratitudefor the co-operation support and guidance received from the Government of Indiaespecially the Ministry of Housing and Urban Affairs Ministry of Rural DevelopmentMinistry of Finance National Housing Bank Regulatory Statutory Authorities and variousDepartments of the Central/State Governments.

The Directors also place on record their gratitude for the confidencereposed in the Company by all its stakeholders including shareholders bondholders publicdeposit holders the State Governments Housing Boards Development AuthoritiesMunicipal/ Local Bodies and other Borrowers etc.

Your Directors also wish to thank BSE Limited National Stock Exchangeof India Limited National Securities Depository Limited Central Depository ServicesLimited Credit Rating Agencies Registrar & Transfer Agents and other agencies fortheir continued cooperation and support.

The Directors also place on record its gratitude for the valuedguidance and support extended by the Comptroller and Auditor General of India StatutoryAuditors M/s Prem Gupta & Co. Chartered Accountants Secretarial Auditors M/sMalhotra Arora & Associates Company Secretaries and other professionals associatedwith the Company.

The Directors also expresses their deep appreciation for the sincereservices cooperation commitment and significant contribution extended by the officialsof the Company at all level in maintaining consistency in growth of the Company.

for and on behalf of the Board of Directors
Dr. M. Ravi Kanth
Place : New Delhi Chairman & Managing Director
Date : 19th August 2019 (DIN:01612905)