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Reliance Home Finance Ltd.

BSE: 540709 Sector: Financials
NSE: RHFL ISIN Code: INE217K01011
BSE 00:00 | 23 May 20.70 -0.15






NSE 00:00 | 23 May 20.80 -0.05






OPEN 22.00
VOLUME 153796
52-Week high 76.90
52-Week low 16.60
P/E 4.28
Mkt Cap.(Rs cr) 1,004
Buy Price 20.70
Buy Qty 200.00
Sell Price 21.10
Sell Qty 500.00
OPEN 22.00
CLOSE 20.85
VOLUME 153796
52-Week high 76.90
52-Week low 16.60
P/E 4.28
Mkt Cap.(Rs cr) 1,004
Buy Price 20.70
Buy Qty 200.00
Sell Price 21.10
Sell Qty 500.00

Reliance Home Finance Ltd. (RHFL) - Director Report

Company director report

Dear Shareowners

Your Directors have pleasure in presenting the 10th Annual Report and theaudited financial statement for the financial year ended March 31 2018.

Financial Performance and State of Company's Affairs

The performance of the Company for the financial year ended March 31 2018 issummarised below:

Particulars Financial Year ended March 31 2018 *Financial Year ended March 31 2017
Total revenue 1 670.52 1 144.68
Profit before depreciation and tax 297.73 144.86
Less: Depreciation & Amortisation 26.18 7.06
Profit before Tax 271.55 137.80
Current tax 21.16 -
(Reversal)/Income Tax for Earlier Year (38.47) (9.57)
Deferred Tax/(Credit) 108.28 (25.22)
Net Profit after Tax 180.58 172.59
Transfer to Debenture Redemption Reserve 194.10 48.52
Amount transferred to Special Reserve Fund 36.11 34.52

*Previous year figures has been regrouped / reclassified wherever necessary.

Financial Performance

The Company's gross income for the financial year ended March 31 2018 increasedto Rs 1670.52 crore from Rs 1144.68 crore in the previous year increase of 46per cent. The profit before tax of the Company increased to Rs 271.55 crore during theyear as against Rs 137.80 crore in the previous year. The net profit for the yearincreased by 4.59 per cent to Rs 180.58 crore from Rs 172.59 crore in the previousyear. The Company continued its robust growth. Assets Under Management (AUM) wereat Rs 16379 crore as at March 31 2018 as against Rs 11174 crore as at March 312017. An amount of Rs 36.11 crore was transferred to Special Reserve Fund pursuantto Section 29 C of the National Housing Bank Act 1987.


Your Directors have recommended a dividend of Rs 1 (10 per cent) per equityshare each of Rs 10 aggregating to Rs 58.38 crore (inclusive of dividend tax) and apro-rata dividend of Rs 0.80 (8 per cent) per preference share each of Rs 10 aggregatingto Rs 1.60 crore for the financial year 2017-18 subject to the approval of themembers of the Company at the 10th Annual General Meeting will be paid to (i)all those equity shareholders whose names appear in the Register of Members as onSeptember 14 2018 and (ii) to those whose names appear in the Register ofBeneficial Owners as on September 14 2018 as furnished by the National SecuritiesDepository Limited and Central Depository Services (India) Limited for the purpose.

In respect of preference shares dividend will be paid on pro-rata basis for thefinancial year ended March 31 2018 to those preference shareholders whose names appear inthe Register of Members on September 14 2018 pursuant to the provisions of the Act andRules made thereunder.

The dividend payout is in accordance with the Company's Dividend Distribution Policywhich forms part of this Annual Report.

Schemes of Arrangement

(a) The Scheme of Arrangement under Sections 391 to 394 of the Companies Act 1956 (the‘Scheme') for demerger of Real Estate Lending Business of the Company'sholding company viz. Reliance Capital Limited (RCap) into the Company was sanctioned bythe National Company Law Tribunal Mumbai Bench on August 10 2017. The Scheme becameeffective on September 5 2017 on filing with the Registrar of Companies Maharashtra atMumbai with effect from April 1 2017 i.e. Appointed Date. Pursuant to theSchemetheCompanyhadissuedandallotted252689630 fully paid-up equity shares to theshareholders of RCap in the ratio of 1:1 on September 7 2017 and after receivingrequisite approvals equity shares of the Company were listed on the Stock Exchanges onSeptember 22 2017; and (b) The Scheme of Arrangement under Sections 391 to 394 of theCompanies Act 1956 (the ‘Scheme') for demerger of Credit Business of India DebtManagement Private Limited (IDMPL) into the Company was sanctioned by the National CompanyLaw Tribunal Mumbai Bench on April 5 2017. The Scheme became effective on April21 2017 on filing with the Registrar of Companies Maharashtra at Mumbai with effect fromMarch 31 2016 i.e. Appointed Date. Pursuant to the Scheme the Company had issued andallotted 31035980 8% Cumulative Non-Convertible Redeemable Preference Shares tothe equity shareholders of IDMPL on August 9 2017.

Besides the two allotments pursuant to the Schemes as mentioned in (a) and (b) above116549188 fully paid-up equity shares were issued and allotted to RCap on September4 2017 on rights basis at a premium of Rs 22 per share.

Accordingly the Issued Subscribed and Paid-up Share Capital of your Company stood atRs 516.10 crore.

Capital Structure

Your Company's Authorised Share Capital was enhanced to Rs 800 crore dividedinto 70 crore equity shares of Rs 10 each and 10 crore preference shares of Rs 10 each onDecember 11 2017.

Capital Adequacy Ratio

Your Company's Capital to Risk Assets Ratio (CRAR) calculated in line with the NHBDirections stood at 19.83 per cent well above the regulatory minimum requirement of 12per cent. Your Company's asset size is Rs 16379 crore.

Management Discussion and Analysis

Management Discussion and Analysis Report for the year under review as stipulated underthe Listing Regulations and the Housing Finance Companies - Corporate Governance (NationalHousing Bank) Directions 2016 is presented in a separate section forming part of thisAnnual Report.

Resources and Liquidity

The Company's Net Worth as on March 31 2018 stood at Rs 1744 crore. TheCompany has raised Rs 9844.42 crore during the financial year 2017-18 by issuance ofCommercial Paper Non-Convertible Debentures (NCDs) and other money market instruments.The funds were deployed in providing Home Loans including Affordable Housing Loans LoanAgainst Property (LAP) and other business requirement. RHFL's debt equity ratio as onMarch 31 2018 stood at 7.55:1.


The Company has neither accepted nor renewed any fixed deposits during the year. Thereare no unclaimed deposits unclaimed / unpaid interest refunds due to the deposit holdersor to be deposited to the Investor Education and Protection Fund as on March 312018.

Particulars of Loans Guarantees or Investments

Pursuant to Section 186(11) of the Companies Act 2013 (the "Act")loans made and acquisition of securities by a Housing Finance Company in the ordinarycourse of its business are exempted from disclosure in the Annual Report.

Subsidiary and Associate companies

The Company does not have any subsidiary or associate company.


The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of Independence as prescribed under the Act and theListing Regulations.

The details of programme for familiarisation of Independent Directors with the Companynature of the industry in which the Company operates and related matters are put up on thewebsite of the Company at the link

During the year under review the Company has appointed Lt Gen Syed Ata Hasnain(Retd) as an Independent Director of the Company for a term of 5 (five) years commencingfrom February 26 2018 and Mr. Jai Anmol Ambani was appointed as anAdditional Director with effect from April 24 2018.

The Company has received the notices in writing from members proposing theircandidature for the office of Directors.

Mr. Amit Bapna Director also held the position of CFO of the Company from September8 2017 to August 7 2018. Mr. Amit Bapna has not drawn any remuneration from the Company.

Mr. Padmanabh Vora who was appointed as an Independent Director of the Company by theMembers for a term of 5 (five) years up to March 24 2020 and will attain the ageof seventy five years on October 1 2018. In terms of the amended Regulation 17 of ListingRegulations vide SEBI Notification No. SEBI/LAD-NRO/GN/2018/10 dated May 9 2018 it isproposed to obtain Members' approval for continuation of directorship after April 1 2019of Mr. Padmanabh Vora as an Independent Director at the ensuing Annual General Meeting(AGM).

In terms of the provisions of the Act Mr. Ravindra Sudhalkar Director of the Companyretires by rotation and being eligible offers himself for re-appointment at the ensuingAGM.

A brief resume of Directors proposed to be appointed / re-appointed at theensuing AGM along with requisite details as stipulated under Regulation 36(3) ofListing Regulations is given in the section on Corporate Governance Report forming partof this Annual Report.

Mr. K. V. Srinivasan ceased to be a Director with effect from April 24 2017. The Boardplaced on record its deep sense of appreciation for the invaluable contributionmade by Mr. K. V. Srinivasan during his tenure with the Company.

Key Managerial Personnel

Mr. Pinkesh R. Shah was appointed as the Chief Financial Officer of the Company onAugust 7 2018 and upon his appointment Mr. Amit Bapna has ceased to be the CFO.

During the year Mr. Sandip Parikh ceased to be the Chief Financial Officer ofthe Company with effect from September 8 2017.

The Board placed on record its deep sense of appreciation for the invaluablecontribution made by them during their tenure with the Company.

Evaluation of Directors Board and Committees

The Company has devised a policy for performance evaluation of the individualDirectors Board and its Committees which includes criteria for performance evaluation.

Pursuant to the provisions of the Act and Regulation 17(10) of the Listing Regulationsthe Board has carried out an annual performance evaluation of its own performance theDirectors individually as well as the evaluation of the working of the Committees of theBoard. The Board performance was evaluated based on inputs received from all the Directorsafter considering criteria such as Board composition and structure effectiveness of Board/ Committee processes and information provided to the Board etc. A separate meeting ofthe Independent Directors was also held during the financial year for the evaluation ofthe performance of non-independent Directors performance of the Board as a whole and thatof the Chairman of the Board.

The Nomination and Remuneration Committee has also reviewed the performance of theindividual Directors based on their knowledge level of preparation and effectiveparticipation in meetings understanding of their roles as directors etc.

Policy on appointment and remuneration for Directors Key Managerial Personnel andSenior Management Employees

The Nomination and Remuneration Committee of the Board has devised a policy forselection and appointment of Directors Key Managerial Personnel and Senior ManagementEmployees and their Remuneration. The Committee has formulated the criteria fordetermining qualifications positive attributes and independence of a Director which hasbeen put up on the Company's website at The policy on theabove is attached as Annexure - A.

Directors' Responsibility Statement

Pursuant to the requirements under Section 134(5) of the Act with respect to Directors'Responsibility Statement it is hereby confirmed that:

i. In the preparation of the annual financial statement for the financial year endedMarch 31 2018 the applicable Accounting Standards had been followed along with properexplanation relating to material departures if any;

ii. The Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2018 and of the profit ofthe Company for the year ended on that date;

iii. 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;

iv. The Directors had prepared the annual financial statement for the financial yearended March 31 2018 on a ‘going concern' basis;

v. The Directors had laid down proper internal financial controls to be followed by theCompany and such financial controls are adequate and are operating effectively; and

vi. The Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

Contracts and Arrangements with Related Parties

All contracts / arrangements / transactions entered into / by the Company during thefinancial year under review with related parties were on an arm's length basis and in theordinary course of business.

There were no materially significant related party transactions which could havepotential conflict with interest of the Company at large.

During the year the Company had not entered into any contract / arrangement /transaction with related parties which could be considered material in accordance with thepolicy of the Company on materiality of related party transactions.

All Related Party Transactions were placed before the Audit Committee as also the Boardfor approval. Prior omnibus approval of the Audit Committee and the Board was obtained forthe transactions which were of a repetitive nature. The transactions entered into pursuantto the omnibus approval so granted were reviewed and statements giving details of allrelated party transactions were placed before the Audit Committee and the Board ofDirectors on a quarterly basis.

The policy on Related Party Transactions as approved by the Board is uploaded on theCompany's website at the link Your Directors draw attention of the members to Note No. 36 to theFinancial Statement which sets out related party disclosures.

Material Changes and Commitments if any affecting the financial position of theCompany

There were no material changes and commitments affecting the financial position of theCompany which have occurred between the end of the financial year and the date of thisReport.

Meetings of the Board

A calendar of Meetings is prepared and circulated in advance to the Directors. Duringthe year eight Board Meetings were held details of meetings held and attended by eachDirector are given in the Corporate Governance Report.

Audit Committee

The Audit Committee of the Board consists of Independent Directors namely Ms.Deena Mehta Chairperson Mr. Padmanabh Vora Lt Gen Syed Ata Hasnain (Retd) and Non-IndependentDirector Mr. Gautam Doshi as members. During the year all the recommendations made by theAudit Committee were accepted by the Board.

Auditors and Auditors' Report

M/s. Price Waterhouse & Co Chartered Accountants LLP were appointed as Auditors ofthe Company for a term of 5 (five) consecutive years at the Annual General Meeting of theCompany held on July 24 2017. The Company has received a letter from M/s. PriceWaterhouse & Co Chartered Accountants LLP that they are not disqualified fromcontinuing as Auditors of the Company.

The Notes on Financial Statement referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The observations and commentsgiven by the Auditors in their Report read together with notes on Financial Statements areself-explanatory and hence do not call for any further comments under Section 134 of theAct.

Maintenance of Cost Records

The Central Government has not specified maintenance of cost records for any ofthe products of the Company under Section 148(1) of the Act.

Secretarial Standards

During the year under review the Company has complied with the applicable SecretarialStandards issued by The Institute of Company Secretaries of India.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board of Directors had appointedM/s. Aashish K. Bhatt & Associates Practicing Company Secretaries to undertake theSecretarial Audit of the Company. There is no qualification reservation or adverse remarkmade in their Secretarial Audit Report. The Audit Report of the Secretarial Auditor isattached as Annexure – B.

Extract of Annual Return

Extract of the Annual Return of the Company in form MGT-9 is attached as Annexure - C.

Particulars of Employees and related disclosures (a) Employees Stock Option Scheme

Employees Stock Option Scheme (ESOS Scheme) was approved and implemented by theCompany and Options were granted to the employees in accordance with guidelinesapplicable to ESOS Scheme. The Nomination and Remuneration Committee of the Board monitorsthe Scheme. The existing ESOS Scheme is in compliance with the Companies Act 2013read with Rules made thereunder and Securities and Exchange Board of India (Share BasedEmployee Benefits) Regulations 2014 (SEBI Regulations). The Company has received acertificate from the Auditors of the Company that the ESOS Scheme have beenimplemented in accordance with the Companies Act and SEBI Regulations and as per theresolution passed by the members of the Company authorising issuance of the saidOptions. The details as required to be disclosed under SEBI Regulations are put onthe Company's website at

(b) Other Particulars

In terms of the provisions of Section 197(12) of the Act read with Rule 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 asamended a statement showing the names and other particulars of the employees drawingremuneration in excess of the limits set out in the said Rules are provided in the AnnualReport which forms part of this Report.

Disclosures relating to the remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 as amended are also provided in theAnnual Report which forms part of this Report.

However having regard to the provisions of first proviso to Section 136(1) of the Actthe Annual Report excluding the aforesaid information is being sent to all the members ofthe Company and others entitled thereto. The said information is available for inspectionat the Registered Office of the Company on all working days except Saturdays between11:00 A.M. and 1:00 P.M. up to the date of the Meeting. Any member interested in obtainingthe same may write to the Company Secretary and the same will be furnished on request.

Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo

The Company is a Housing Finance Company and does not involve in any manufacturingactivity most of the information as required under Section 134(3)(m) of the Act read withRule 8 of the Companies (Accounts) Rules 2014 are not applicable. However theinformation as applicable has been given in Annexure – D forming part of this Report.

Corporate Governance

The Company has adopted ‘Reliance Group - Corporate Governance Policies and Codeof Conduct' which sets out the systems process and policies conforming to theinternational standards. The report on Corporate Governance as stipulated under Regulation34(3) read with Para C of Schedule V of the Listing Regulations and the Housing FinanceCompanies - Corporate Governance (National Housing Bank) Directions 2016 as amendedfrom time to time is presented in separate section forming part of this Annual Report.

A Certificate from the Auditors of the Company M/s. Price Waterhouse & CoChartered Accountants LLP confirming compliance to the conditions of Corporate Governanceas stipulated under Para E of Schedule V of the Listing Regulations is enclosed to thisReport.

Ombudspersons & Whistle Blower (Vigil Mechanism)

The Company has formulated an Ombudspersons & Whistle Blower (VigilMechanism) policy to address the genuine concerns if any of the Directors and employees.The details of the same have been stated in the Report on Corporate Governance and thepolicy can be accessed on the Company's website.

Risk Management

The Company has laid down a robust Risk Management Policy defining Risk profilesinvolving Strategic Technological Operational Financial Organisational Legal andRegulatory risks within a well defined framework. The Risk Management Policy acts as anenabler of growth for the Company by helping its businesses to identify the inherentrisks assess evaluate and monitor these risks continuously and undertake effective stepsto manage these risks.

A Risk Management Committee (RMC) consisting of Ms. Deena Mehta as Chairpersonand Mr. Padmanabh Vora Mr. Gautam Doshi Mr. Amit Bapna and Mr. Ravindra Sudhalkar asmembers periodically reviews the robustness of the Risk Management Policy. The periodicalupdate on the risk management practices and mitigation plan of the Company are presentedto the Audit Committee and Board of Directors. The Audit Committee and Board periodicallyreview such updates and findings and suggest areas where internal controls and riskmanagement practices can be improved. More details on Risk Management indicatingdevelopment and implementation of Risk Management Policy including identification ofelements of risk and their mitigation are covered in Management Discussion and Analysissection which forms part of this Report.

Asset Liability Committee (ALCO) consisting of senior management executives monitorsliquidity and interest rate risks of the Company. The functioning of ALCO is reviewed bythe RMC which meets quarterly and reports to the Board of Directors.

Compliance with provisions of Sexual Harassment of Women at workplace (PreventionProhibition and Redressal) Act 2013

The Company is committed to uphold and maintain the dignity of woman employees and ithas in place a policy which provides for protection against sexual harassment of women atwork place and for prevention and redressal of such complaints. During the year no suchcomplaints were received. The Company has also constituted an Internal ComplianceCommittee under the Sexual Harassment of Women at workplace (Prevention Prohibition andRedressal) Act 2013.

Corporate Social Responsibility

The Company has constituted Corporate Social Responsibility (CSR) Committee incompliance with the provisions of Section 135 of the Act read with the Companies(Corporate Social Responsibility Policy) Rules 2014. The Corporate Social ResponsibilityCommittee has formulated a Corporate Social Responsibility Policy (CSR policy) indicatingthe activities to be undertaken by the Company. The CSR policy may be accessed onthe Company's website at the link;

The CSR Committee consists of Mr. Padmanabh Vora as Chairman Mr. Gautam Doshi and Mr.Ravindra Sudhalkar as members. The disclosures with respect to CSR activities is given inAnnexure- E.

Order if any passed by Regulators or Courts or Tribunals

No orders have been passed by the regulators or courts or tribunals impacting the goingconcern status and the Company's operations.

Internal Financial Controls and their adequacy

The Company has in place adequate internal financial controls across the organization.The same is subject to review periodically by the internal audit cell for itseffectiveness. During the year such controls were tested and no reportable materialweakness in the design or operation were observed.

Business Responsibility Report

Business Responsibility Report for the year under review as stipulated under ListingRegulations is presented in the separate section forming part of this Annual Report.


Your Directors would like to express their sincere appreciation for the co-operationand assistance received from shareholders debenture holders debenture trustee bankersfinancial institutions regulatory bodies and other business constituents during the yearunder review. Your Directors also wish to place on record their deep sense of appreciationfor the commitment displayed by all executives officers and staff resulting in thesuccessful performance of the Company during the year.

For and on behalf of the Board of Directors
Ravindra Sudhalkar Padmanabh Vora
Executive Director & CEO Non-Executive Chairman
August 7 2018