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Paisalo Digital Ltd.

BSE: 532900 Sector: Financials
BSE 00:00 | 18 Apr 326.00 -1.10






NSE 00:00 | 18 Apr 321.55 -8.95






OPEN 327.90
52-Week high 370.00
52-Week low 237.20
P/E 23.54
Mkt Cap.(Rs cr) 1,322
Buy Price 311.00
Buy Qty 1.00
Sell Price 326.00
Sell Qty 435.00
OPEN 327.90
CLOSE 327.10
52-Week high 370.00
52-Week low 237.20
P/E 23.54
Mkt Cap.(Rs cr) 1,322
Buy Price 311.00
Buy Qty 1.00
Sell Price 326.00
Sell Qty 435.00

Paisalo Digital Ltd. (PAISALO) - Director Report

Company director report




Your Board of Directors have pleasure in presenting the 26th Board's Report of theCompany together with the Audited Financial Statements for the Financial Year ended March31 2018.

Financial Highlights

The standalone financial performance of the Company for the Financial Year 2017-18 issummarized below:

(Rs in Million)

Particulars 2017-18 2016-17
Total Income 2874.96 2495.18
Less: Expenditure 879.86 835.61
Profit Before Depreciation Financial Cost & Tax (PBDIT) 1995.10 1659.57
Less: Financial Cost 1147.62 883.75
Profit Before Depreciation & Tax (PBDT) 847.48 775.82
Less: Depreciation 4.26 3.96
Profit Before Tax (PBT) 843.22 771.86
Less: Tax Expenses 274.72 258.95
Net Profit After Tax (PAT) 568.50 512.91
Add: Profit b/f from the Previous Year 15.97 30.73
Profit Available for Appropriation 584.47 543.64
Dividend Including Tax 45.53 45.53
Provision for Standard Assets 19.28 14.52
Expenditure on CSR Activities 14.50 15.04
Transfer to General Reserve 380.00 350.00
Transfer to Reserve Fund (RBI Act) 113.70 102.58
Balance Carried to Balance Sheet 11.46 15.97

The Company has posted a profit after tax (PAT) of`568.50 Million for FY 2017-18 ascompared to a PAT of Rs 512.91 Million for FY 2016-17.


Nupur Finvest Private Limited a registered Non Deposit taking Non-Banking FinanceCompany is the only Subsidiary Company of which the Company owns one hundred percentshares.

Nupur Finvest Private Limited is engaged in business to provide MSME and incomegeneration loans for self employement purpose. At the year ended March 31 2018 the networth of the Company stood at Rs 531.80 Million. During the reporting period thesubsidiary reported a gross income of Rs 310.52 Million and Profit Before Tax (PBT) andProfit After Tax (PAT) at Rs 46.00 Million Lakhs and Rs 30.79 Million respectively.

Consolidated Financial Statements

In compliance with the applicable provisions of Companies Act 2013 includingapplicable Accounting Standard on Consolidated Financial Statements this Annual Reportalso includes Consolidated Financial Statements for the Financial Year 2017-18.Consolidated Turnover was Rs 3043.55 Million as against Rs 2665.42 Million in the previousyear.

Review of Operations

The Company is providing a number of financial products like Business Loans SME &MSME Loans Income Generation Loans for business/self employment purpose. During the yearunder review Company has posted 18.035% increase in the total finance business of theCompany.


During the Financial Year 2017-18 total disbursements (including figures ofSubsidiary) reached to Rs 17655.291Million. The Company is focusing to maintain the assetquality of its loan portfolio without compromising the risk profile.

Number of Customers

Total Customers outreach stood at 878682 being increased by 13.30 % as compared toprevious year.

Net Worth and Capital to Risk Adjusted Ratio (CRAR)

The Net Worth of the Company increased to Rs 6034.90 Million as on March 31 2018 fromRs 5524.10 Million as on March 31 2017. The Capital to Risk Adjusted Ratio (CRAR) stoodat 31.67% as on March 31 2018 as against 38.08% as on March 31 2017 which is much abovethe requirement as stipulated by Reserve Bank of India.


Your Board is pleased to recommend a final dividend of Rs 1/- (Rupee One only) pershare i.e. 10% on each fully paid equity share of Rs 10/- (Rupees Ten Only) for FinancialYear 2017-18.

Pursuant to the provisions of Section 124 (5) of the Companies Act 2013 Interim/Finaldividend for the Financial Year 2009-10 and 2010-11 amounted to Rs 30029/- and Rs101929/- respectively which were unpaid and unclaimed for a period of 7 years from thedate it was lying in the unpaid dividend account has been transfered by the company to theInvestor Education and Protection Fund (IEPF) of the Center Government.

Fixed Deposits

Company has not accepted any public deposits and as such no amount on account ofprincipal or interest on public deposits was outstanding as on the date of balance sheet.

Launch of New App

“India is getting digital so are we” keeping this aphorism in mind yourCompany launched the App “PAISALO” in view to ease of finance and to eliminatethe presence of the middle-man and to reduce corruption.

Through this mobile app any person who is in need of small finance can convenientlyapply and borrow the amount ranging from Rs 10000 to Rs 50000 from their digital device.

This app can be downloaded from Google Play Store and is available in two languagesi.e. Hindi and English while availability in additional key regional languages will bepart of our future growth strategy.

Name Change

Being a Non Deposit Accepting Systemically Important Non Banking Finance Company(ND-SI-NBFC) is engaged in the finance business and with the change of use of technologyin the Company's business and moving towards digitalized path the Company w.e.f. January12 2018 has changed its name from S. E. INVESTMENTS LIMITED to PAISALO DIGITAL LIMITEDwhich in itself reflects the operations of the Company with itsway of operation (financewith the use of digital platform).

Further your Board assures you that with the new name “Paisalo Digital Limited” the Company is and will always remain true to its motto " : :"“Money is trust property of society”.

To celebrate this moment of name change and change of Company scrip ID/code on theStock Exchanges an Opening Bell Ceremony was organised at NSE Mumbai on January 24 2018.

Scheme of Amalgamation of Agarwal Meadows Private Limited into the Company

The Board of Directors of the Company in their meeting held on February 23 2018 hasapproved the Scheme of Amalgamation of Agarwal Meadows Private Limited into PaisaloDigital Limited pursuant to such Scheme if approved by the National Company Law Tribunaland Other Authorities all the assets and liabilities of Agarwal Meadows Private Limitedwill be transferred and vested in the Company with effect from December 31 2017 beingAppointed Date for the purpose the Scheme and the Company will issue 5918 fully paid-upequity share of Rs 10/- each for every 100 equity shares of Agarwal Meadows PrivateLimited of Rs 100/- each as consideration to the shareholders of Agarwal Meadows PrivateLimited As on the date of this Board's Report the Scheme has been submitted to the StockExchanges for their Observation Letter/ NOC and after getting the NoC from Stock Exchangecompany will submit the same to NCLT for its approval.

Issue of Unlisted Unsecured Non Convertible Debentures

During the year under review Company has raised Rs 280 Million through issue ofUnlisted Unsecured 12% Non Convertible Debentures of Rs 10.00 Million each on privateplacement basis.

Directors and Key Managerial Personnel

Change in Directors or KMP

The following changes took place in the composition of Board of Directors during theyear under review:

Mr. Gauri Shankar was introduced on Board of the Company as an Additional IndependentDirector of the Company w.e.f. July 22 2017. Further on September 26 2017 in the 25thAnnual General Meeting of the Company his appointment was regularized and was appointed asthe Independant Director of the Company for the term of the five years effective from July22 2017.

Mrs. Bhama Krishnamurthy was introduced on the Board as the Additional WomanIndependent Director w.e.f November 25 2017.

On November 25 2017 Mr. Brij Lal Goel Mrs. Anshu Gupta and Dr. Arun Gopal Agarwalresigned from the office of the Director of the Company.

The Board of the Company has appointed Mr. Anoop Krishna as an Additional Director ofthe Company w.e.f February 23 2018.

Further on April 12 2018 The Board of the Company has appointed Mr. Sunil Srivastavaas an Additional Independent Director of the Company.

Other than that no other change took place in the Board of Directors of the Company.

Appointment/Reappointment of Directors or KMP

In terms of Section 152 of Companies Act 2013 Mr. Harish Singh is liable to retire byrotation at the ensuing Annual General Meeting and being eligible for re-appointmentoffers himself for re-appointment.

Board of Directors in their Meeting held on January 30 2018 and May 2 2018 hasreappointed Mr. Sunil Agarwal as Managing Director for further term of 5 years effectingfrom February 20 2018 and Mr. Harish Singh as Executive Director for further term of 5year effecting from August 1 2018 respectively and their such reappointment is proposedto be ratified in the upcoming Annual General Meeting.

Since the date of 25th Annual General Meeting of the Company The Board of Directorshas appointed Mrs. Bhama Krishnamurthy as Additional Independent Director Mr. AnoopKrishna as Additional Professional Director and Mr. Sunil Srivastava has been appointed asAdditional Independent Director of the Company to hold the office till the date offorthcoming Annual General Meeting. Keeping in the view the good experience knowledge andexpertise of all these Additional Directors in Banking Industry Board believes that theirassociation with the Company will be in the interest of the Company and will benefit theCompany in its endeavours. Accordingly Board recommends the appointment of Mrs. BhamaKrishnamurthy Sunil Srivastava as Independent Director and Mr. Anoop Krishna asProfessional Director in the forthcoming Annual General Meeting of the Company.

Number of Board Meetings

During the Financial Year 2017-18 Board of Directors met 8 times on April 28 2017July 22 2017 August 23 2017 October 27 2017 November 25 2017 January 30 2018 andFebruary 23 2018 (2:00 pm and 4:00 pm).

Declaration of Independence by Independent Directors

The Company has received the necessary declaration from each Independent Director inaccordance with Section 149(7) of the Companies Act 2013 that he/she meets the criteriaof independence as laid out in sub-section (6) of Section 149 of the Companies Act 2013and Listing Regulation.

Policy on Directors Appointment and Remuneration

The Company strives to maintain an appropriate combination of Executive andIndependent Directors subject to a minimum of 3 (three) and maximum of 15 (fifteen)Directors including at least one woman Director.

The Nomination & Remuneration Committee of the Company leads the process for Boardappointments in accordance with the requirements of Companies Act 2013 listing agreementand other applicable regulations or guidelines. All the Board appointments are based onmeritocracy.

The potential candidates for appointment to the Board are inter-alia evaluated on thebasis of personal and professional ethics standing integrity values and character;appreciation of the Company's vision mission values; prominence in businessinstitutions or professions professional skill knowledge and expertise financialliteracy and such other competencies and skills as may be considered necessary.

In addition to the above the candidature of an Independent Director is also evaluatedin terms of the criteria for determining independence as stipulated under Companies Act2013 Listing Regulation guidelines issued by RBI and other applicable regulations orguidelines. In case of re-appointment of Directors the Board shall take intoconsideration the results of the performance evaluation of the Directors and theirengagement level.

The Company has Remuneration Policy for Directors KMPs and other employees which isreviewed by the Board of Directors of the Company from time to time. The policyrepresents the overarching approach of the Company for the remuneration of Directors KMPsand other employees.

Board's Responsibility Statement

Pursuant to the requirement under Section 134(3)(c) read with Section 134(5) of theCompanies Act 2013 with respect to Board's Responsibility Statement it is herebyconfirmed that: a) in the preparation of the annual accounts for the financial year endedMarch 31 2018 the applicable accounting standards have been followed and there are nomaterial departures from the same; b) the Directors had selected such accounting policiesand applied them consistently and made judgments and estimates that are reasonable andprudent so as to give a true and fair view of the state of affairs of the Company at theend of the financial year and of the profit and loss of the Company for that period; c)the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities; d) the Directors had prepared the annual accounts on a going concernbasis; e) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and f) the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

Auditors & Audit Reports

Statutory Auditor & Audit Report

M/s Mukesh Kumar & Co Chartered Accountants have been appointed as StatutoryAuditor of the Company in its 25th Annual General Meeting held on September 26 2017 for 3years subject to annual ratification. Accordingly Board of Directors recommends theratification of appointment of Statutory Auditor of the Company.

The observations of Auditors in their report read with notes to the accounts areself-explanatory and do not call for any further explanation. The Auditors of the Companyhave not given any adverse remarks or disclaimers in the report.

Secretarial Auditor and Secretarial Audit Report

In accordance with the provisions of Section 204 of the Companies Act 2013 and as ameasure of good Corporate Governance practice the Company in its Board Meeting held onJanuary 30 2018 has appointed CS Satish Kumar Jadon Practicing Company Secretary as itsSecretarial Auditor to conduct secretarial audit of the Company for financial year endedMarch 31 2018. The Report of Secretarial Auditor for financial year ended March 31 2018being a part of this Board's Report is enclosed herewith as Annexure A. The Reportof Secretarial Auditor is self explanatory and no explanation is required thereon from theBoard of Directors of the Company.

Fraud reported by auditors under Section 143(12) other than those which are reported tothe Central Government

Pursuant to provisions of Section 143(12) of the Companies Act 2013 the Auditors ofthe Company have not reported about any fraud which is being or has been committed in theCompany by its officers or employees.

Particulars of Loans Guarantees or Investments Under Section 186 of Companies Act2013

Being RBI registered Non Banking Finance Company in terms of Section 186(11) of theCompanies Act 2013 the provisions of Section 186 except Sub-Section 1 of the saidSection shall not apply on the Company hence disclosure under Section 134 (3) (g) of theCompanies Act 2013 of particulars of the loans given investments made or guaranteesgiven or securities provided under Section 186 of the Companies Act 2013 is notapplicable to the Company.

Related Party Transactions

During the year under review transactions entered into with Related Parties asdefinedunder Companies Act 2013 and SEBI (LODR) Regulations 2015 were in the ordinarycourse of business and at an arm's length pricing basis and do not attract the provisionsof Sections 188 of the Companies Act 2013. Related party transactions under the ordinarycourcse of business are disclosed in the Note no. 30 of the financial statement.

The details of the transactions with Related Parties were placed before the AuditCommittee for its prior approval from time to time.

Policy on materiality of related party transactions and on dealing with related partytransactions is displayed on the website of the Company at

Material Changes and Commitments if any Affecting the Financial Position of theCompany

There are no material changes and commitments affecting the financial position of theCompany which occurred between the end of the financial year of the Company and date ofthis Board's Report.

Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo

Considering the nature of business undertaken by the Company during the year underreview the particulars pursuant to Section 134 (3) (m) of the Companies Act 2013 readwith Rule 8 of the Companies (Accounts) Rules 2014 to the extent applicable are asfollows:

Since the Company does not own any manufacturing facility the particulars relating toconservation of energy and technology absorption have not been furnished.

Foreign Exchange earnings for the Company during the financial year under review wasnil and Company's Foreign Exchange outgo during the financial year under review was`0.20million.

Corporate Social Responsibility

In accordance with the provisions of Section 135 of the Companies Act 2013 read withrules made thereunder Company has constituted a Corporate Social ResponsibilityCommittee which framed a Board approved CSR Policy for the Company and the same isavailable on the website of the Company. CSR Policy of the Company has vision to makeconcrete efforts towards providing preventive health care sustainable development ofgreen environment and welfare of animal.

For the financial year 2017-18 the Company has decided to undertake its CSR activitiesthrough a registered trust a Company not for profit which is engaged to develop start-upsin the space of Agribusiness and Technology domains and rural health care initiatives.Composition of CSR Committee as disclosed in Corporate Governance Section of this AnnualReport as part of Board's Report and other details as required under Companies Act 2013is as annexed with this Report as Annexure B.

Details of Significant and Material Orders Passed by the Regulator or Courts orTribunal Impacting the Going Concern Status and Company's Operation in Future

There is no order passed by the Regulators Courts or Tribunals which would impact thegoing concern status of the Company and its future operations.

Risk Management Policy

Non-Banking Finance Companies (NBFCs) form an integral part of Indian financial system.NBFCs are required to ensure that a proper framework on Risk Management System isformulated and put in place. For this purpose Company in addition to Audit Committee hasconstituted Assets Liability Management Committee and Risk Management Committee tofacilitate the Board to address the risk associated with the business of the Company anddeveloped and implemented a risk management policy to ensure sustainable business growthwith stability and promote a proactive approach in reporting evaluating and resolvingrisks associated with the Company's business. The Policy also highlights the functionsresponsibilities and role of the Committees and Board to address the risks associated withthe Company and to mitigate/ reduce the impact of the risk on the Company.

The Company follows a disciplined risk management process and takes business decisionswith balanced risk-reward paradigm.

Internal Financial Control

Your Company remains committed to improve the effectiveness of internal financialcontrols and processes which would help in efficient conduct of its business operationsensure security to its assets and timely preparation of reliable financial information.

The internal financial controls with reference to the Financial Statements areadequate in the opinion of the Board of Directors.

The Company has a proper system of internal controls to ensure that all assets aresafeguarded and protected against loss from unauthorized use or disposition and thattransactions are authorized recorded and reported correctly.

The internal control is supplemented by an extensive programme of internal externalaudits and periodic review by the Management. This system is designed to adequately ensurethat financial and other records are reliable for preparing financial information andother data and for maintaining accountability of assets. A firm of Chartered Accountantshas been engaged by the Company for conducting internal audit to examine and evaluate theadequacy and effectiveness of internal financial control system of the Company.

Internal Financial Control System of the Company is modified continuously in accordancewith the dynamic changes in the business conditions and to comply with the applicablelaws regulations statutory and accounting requirements.

Human Resources

Company's industrial relations continued to be harmonious during the period underreview.

Your Company strives to provide the best work environment with ample opportunities togrow and explore. Healthy cordial and harmonious industrial relations have beenmaintained by the Company at all levels.

Information required under Sexual Harassment of Women at Work Place (PreventionProhibition & Redressal) Act 2013

The Company has a policy against sexual harassment and process for dealing withcomplaints of harassment or discrimination in line with the requirements of the SexualHarassment of Women at Workplace (Prevention Prohibition & Redressal) Act 2013. TheDirectors further state that during the year under review there was no case filed pursuantto the sexual harassment of women at workplace (Prevention Prohibition and Redressal) Act2013.

Disclosures as per the Provision of Section 197 (12) of Companies Act 2013

Information in accordance with provisions of Section 197(12) of the Companies Act2013 read with Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are forming part of this report as Annexure C. The statement containingparticulars of employees as required under Section 197 (12) of the Companies Act 2013read with rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnal) rule 2014 may be obtained by the members by the writing to the CompanySecratary of the Company.

Credit Rating

Infomerics Valuation and Rating Pvt. Limited vide its letter dated March 26 2018 hasassigned IVR A/Stable outlook rating to company's fund based Bank facilities for an amountof Rs 9900.00 Million Further M/s India Ratings & Research Private Limited (A FitchGroup Company) through its letter dated July 25 2017 has assigned following rating toCompany's instruments: i) Long Term Banks Loans Limit of Rs 8000.00 million (increasedfrom Rs 6500.00 million): Rating IND A- Outlook-Positive; i) Long Term Debentureaggregating to Rs 1000 million: Rating-IND A- Outlook –Positive.

Compliance of Reserve Bank of India Guidelines

The Company always adheres to comply with applicable provisions of prudential normsrules regulations and guidelines issued by Reserve Bank of India for Non BankingFinancials Companies.

Timely Repayment of Loan Liabilities

During the year under review the Company has duly serviced all its debts obligationsin time.

Extracts of Annual Return

Pursuant to section 92(3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management and Administration) Rules 2014 Extracts of Annual Return in the form MGT-9is annexed herewith as integral part of this Report as Annexure D.

Management Discussion and Analysis of Financial Conditions

An analysis of the financialconditions and results of operations of the Company for theyear under review has been represented in the Annual Report as a separate section onManagement Discussion and Analysis as an integral part of this Annual Report.

Corporate Governance

Your Company strives toensurethatthebestcorporategovernancepracticesareidentifiedadopted and consistentlyfollowed. It is ensured that the practices being followed by the Company are in alignmentwith its philosophy towards Corporate Governance. Your Company believes that goodcorporate governance is the basis for sustainable growth of the business and effectivemanagement of relationship among constituents of the system and always works towardsstrengthening this relationship through corporate fairness transparency andaccountability. Your Company gives prime importance to reliable financial informationintegrity transparency fairness empowerment and compliance with law in letter andspirit. The report on corporate governance forms an integral part of this report and isset out as separate section to this Annual Report.

Detailed compliance with the provisions of Listing Regulation for the Finance Year2017-18 along with Certificate of Compliance from the Statutory Auditor has beenmentioned in the Corporate Governance Report Section of this Report which is annexedherewith as Annexure E.

Performance of the Board of Directors Its Committees and Individual Directors

Mounting stakeholders' expectations challenges faced by the Companies to operate underfluctuating and increased regulatory requirements have brought the quality of performanceof the Board of Directors under greater scrutiny. The Board of Directors have recognisedthat it would be important for them to continually assess how effectively they areperforming their roles against the objectives and the goals they have set for themselves.This growing recognition has resulted in Board's evolutions as a critical structural toolfor assessing Board's effectiveness and efficiency.

Considering the above facts and in light of the Company's performance the performanceof the Board of Directors and their committees along with performance of individualDirectors is reviewed and evaluated from time to time by Nomination and RemunerationCommittee and the Board of Directors through various manner like discussion withDirectors seeking views of one Director from other Directors inputs from the Directorsthrough structured questionnaires covering the various aspects of the Board functioningsuch as adequacy of composition of the Board and its Committees Board culture executionand performance of specific duties obligations participation of Directors in the variousmatters skill and knowledge of individual Director and independence of judgementcontribution towards development of the strategy risk management. The Directors expressedsatisfaction with the evaluation process. The performance of the Directors individuallyand collectively and performance of the committees are found satisfactory. With the spiritof wealth creation for the stakeholders of the Company your Directors are committed togive their efforts towards the development of the Company. Independent Directors alsoreviewed the performance of the Board as a whole and assessed the quality and timelinessof the flow of the information between the Company Management and Board.


We place on record our appreciation of the contribution made by our employees at alllevels. Our consistent growth was made possible by their hard work solidaritycooperation and support. Your Directors wish to place on record their gratitude for thevaluable assistance and co-operation extended to the Company by Banks GovernmentAuthorities Customers Shareholders of the Company and we are looking forward to theircontinued support and co-operation in future.

Date : May 2 2018 For & on behalf of the Board of Directors
Place : New Delhi of Paisalo Digital Limited
Sd/- Sd/-
(Sunil Agarwal) (Harish Singh)
Managing Director Executive Director
DIN : 00006991 DIN : 00039501