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Sahara Housing Fina Corporation Ltd.

BSE: 511533 Sector: Financials
NSE: N.A. ISIN Code: INE135C01012
BSE 00:00 | 24 Sep 48.95 2.60
(5.61%)
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NSE 05:30 | 01 Jan Sahara Housing Fina Corporation Ltd
OPEN 46.50
PREVIOUS CLOSE 46.35
VOLUME 476
52-Week high 68.30
52-Week low 28.65
P/E 16.76
Mkt Cap.(Rs cr) 34
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 46.50
CLOSE 46.35
VOLUME 476
52-Week high 68.30
52-Week low 28.65
P/E 16.76
Mkt Cap.(Rs cr) 34
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sahara Housing Fina Corporation Ltd. (SAHARAHOUSING) - Director Report

Company director report

Dear Members

The Board of Directors of your Company takes pleasure in presenting theTwenty-Ninth Annual Report along with the Audited Financial Statements for thefinancial year ended March 31 2020.

FINANCIAL RESULTS

The Financial Performance of the Company for the financial year endedMarch 31 2020 is summarised below;

Particulars 2019-20 2018-19
Gross Income 1455.88 1635.17
Less:
– Interest 621.41 768.69
– Overheads 501.01 476.48
– Depreciation 54.94 50.94
Profit Before Tax (PBT) 278.52 339.06
Provision for Taxation
– Current Tax 58.75 66.47
– Deferred Tax 11.49 11.54
– Income Tax related to earlier years 0.58 0.17
Profit After Tax (PAT) 207.70 260.88
Add: Profit carried from earlier years 1973.26 1767.01
Profit available for appropriations 2180.96 2027.89
Appropriations
Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act 1961 read with Section 29C of the National Housing Bank Act 1987 55.26 54.63
Balance carried to Balance Sheet 2125.70 1973.26
Total 2125.70 1973.26

Note:

The Company has adopted Indian Accounting Standard (referred to as‘Ind AS') with effect from April 1 2019 and accordingly these financialresults along with the comparatives have been prepared in accordance with the recognitionand measurement principles stated therein prescribed under Section 133 of the CompaniesAct 2013 read with the relevant rules issued thereunder and the other accountingprinciples generally accepted in India.

PERFORMANCE

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

Profit (PBT & PAT) & Income

• The Profit and Loss Account shows a Profit Before Tax (PBT) ofRs. 278.52 lakhs for the year ended March 31 2020 after making provisions for NPAs andgeneral provision on Standard Loan Assets and taking into account all expenses includingdepreciation as against the PBT of Rs. 339.06 lakhs for the previous year ended March 312019. The provision for income tax is `70.82 lakhs and the Profit After Tax (PAT) for theyear is Rs. 207.70 lakhs as against Rs. 260.88 lakhs in the previous year. Taking intoaccount the balance of `1973.26 lakhs brought forward from the previous year thedistributable profit as at March 31 2020 is Rs. 2180.96 lakhs.

• The Gross Income for the year under review was Rs. 1455.88 lakhsas against the previous financial year's income of Rs. 1635.16 lakhs.

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

• Shareholder's Equity (Net Owned Fund) as at March 31 2020was `4488.78 lakhs as against

Rs. 4279.85 lakhs in the previous year representing an increase of4.88 per cent.

• The total Assets under Management of the Company as on March 312020 was Rs. 10283.79 lakhs as against Rs. 11995.93 lakhs in the previous year.

Transfer to Special Reserve

During the year under review your company transferred Rs. 55.26 lakhsto the Statutory Reserve under Section 36(1)(viii) of the Income Tax Act 1961 read withSection 29C of the NHB Act 1987. Deferred Tax Liability on the Special Reserve for theyear under review has been created in accordance with the Circular No.: NHB(ND)/DRS/PolicyCircular No. 65/2014/15 dated August 22 2014 issued by the National Housing Bank (NHB).

Earnings per Share (EPS)

The Earnings per share (EPS) as at March 31 2020 was Rs. 2.97 asagainst Rs. 3.73 as at March 31 2019.

Share Capital

The paid up equity share capital as on March 31 2020 was Rs. 7.00Crores divided into 7000000 equity share of face value of Rs. 10 each.

a. Issue of equity shares with differential rights/ buy back TheCompany neither issued equity shares with differential rights during the financial year2019-20 nor bought back any of its shares during the year under review.

b. Issue of sweat equity shares The Company did not issue any sweatequity shares during the financial year 2019-20.

c. Issue of employee stock options The Company did not issue anystock options during the financial year 2019-20.

d. Provision by company for purchase of its own shares by employees orby trustees for the benefit of employees The Company does not have a scheme forpurchase of its own shares by employees or by any Trustee for the benefit of employees.

Subordinated Debt

Your Company did not raise any fresh money through subordinated debtduring the year under review. The outstanding subordinated debt in the form of NonConvertible Debt (Unsecured) of Rs. 25 crore alongwith interest thereon was fullyextinguished on its due date i.e. July 24 2019. As on March 31 2020 there is nooutstanding that can qualify as subordinated debt.

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

Your company did not raise fresh money through (Unlisted) Secured NonConvertible Debentures (NCD) during the year under review. As on March 31 2020 yourCompany's outstanding secured long time borrowing was Rs. 30 Cr. and interest duethereon has been paid.

Material Changes & Commitments occurring after the end of FinancialYear

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

Capital Adequacy

As per the Housing Finance Companies (NHB) Directions 2010 everyHousing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of 13per cent (as on March 31 2020). The Capital Adequacy Ratio of your company as at March 31of Year 2020 2019 and 2018 is set out in the table below:

Particulars As at March 31
2020 2019 2018
Capital Adequacy Ratio (%) 78.73 61.63 55.21

Investment in Subsidiaries Associates and Joint Ventures

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

Lending Performance

During the year under review the Company disbursed loans aggregatingto Rs. 836.09 lakhs as against Rs. 1585.89 lakhs in the previous year. The overalloutstanding loan portfolio as at March 31 2020 stood at Rs. 10283.79 lakhs as against Rs.11995.93 lakhs in the previous year March 31 2019.

The Cumulative Log-in Sanction and Disbursement as at March 31 2020and 2019 are as under:

Particulars No. of Accounts (Amount in Lakhs)
2019-20 2018-19 2019-20 2018-19
Cumulative Log-in 6457 6421 68139.17 67153.07
Cumulative Sanction 4278 4224 49040.10 48110.70
Cumulative Disbursement 4088 4042 43869.94 43033.91

Fresh Loans

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

(Rs. In Lakhs)

Particulars 31.03.20 31.03.19 31.03.18 31.03.17 31.03.16
Sanction 929.40 1678.67 3722.60 2565.20 1697.68
Disbursement 836.03 1585.89 2584.66 1884.61 1455.85

The Company continues to serve from four regions East (Kolkata) North(Lucknow) South (Hyderabad) and West (Mumbai) with eleven branches located at KolkataSiliguri Ranchi Durgapur Lucknow Gorakhpur Mumbai Pune Hyderabad Vijayawada andVisakhapatnam.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY

Your Company strictly adheres to the prudential guidelines for Non-Performing Assets (NPAs) issued by the National Housing Bank (NHB) under its Directions of2010 as amended from time to time. As per the prudential norms the Company did notrecognise any income on such NPAs. The Company has made appropriate provision forcontingencies on standard as well as non-performing housing loans and other loans as perthe norms set by NHB.

The amount of Gross Non-Performing Assets (GNPA) on the Housing Loanportfolio as on March 31 2020 was

`828.31 lakhs against Rs. 829.08 lakhs as at March 31 2019. TheExecutive Management is taking necessary steps to contain the same within limit.

Dividend

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

Deposits

Your Company has been granted certificate of registration by NationalHousing Bank New Delhi as a non-deposit taking Housing Finance Company. In accordancewith the said stipulations the Company under the current management has neither acceptedin the past nor has any future plans to accept any public deposits by whatever meanscalled. There are no unclaimed deposits as on March 31 2020.

Particulars of Loans Guarantees or Investments

Since the company is a Housing Finance Company the disclosureregarding particulars of loans given guarantees given and security provided is exemptunder the provision of Section 186(11) of the Companies Act 2013. As regards investmentsthere are no investments made by the Company for the year ended March 31 2020 exceptshort term investment in Fixed Deposit with Nationalised Bank.

National Housing Bank (NHB) Guidelines

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

Other Regulatory Compliance

The Company has also been following directions guidelines circularsissued by SEBI Stock Exchange (BSE) and MCA from time to time pertaining to listedcompanies. In order to prevent frauds in loan cases involving multiple lending fromdifferent banks / housing finance companies the Government of India has set up theCentral Registry of Securitization Asset Reconstruction and Security Interest of India(CERSAI) under Section 20 of the SARFAESI Act 2002 to have a central database of allmortgages created by lending institutions. Your Company is registered with and the data inrespect thereto is being submitted from time to time.

Directors and Key Managerial Personnel

Shri Joy Broto Roy (DIN: 00432043) resigned as a director of theCompany with effect from November 14 2019. The Board places on record its sincereappreciation of the contribution made by Shri Joy Broto Roy during his tenure as a memberon the Board of the Company since February 13 2017.

Based on the recommendation of the Nomination and RemunerationCommittee and approval of the same by the Board at its meeting held on February 13 2020the Independent Director Smt. Anshu Roy being eligible for re-appointment as IndependentDirector for the second term of her office having offered herself for reappointment isproposed to be re-appointed as Independent Director for a second consecutive term of 5years from from February 13 2020 to February 12 2025. Resolution in this behalf is setout at item No.3 of the Notice of Annual General Meeting for Members' approval.

At its meeting held on November 14 2019 the Board of Directorsappointed Shri Awdesh Kumar Srivastava as an Additional Director (Non-executiveNon-Independent) of the Company with effect from the said date. Pursuant to the provisionsof Section 161 of the Companies Act 2013 Shri Srivastava holds office till the date ofthe ensuing Annual General Meeting and is eligible for appointment as Director of theCompany. A Resolution in this behalf is set out at item No.4 of the Notice of AnnualGeneral Meeting for Members' approval. Brief resumes of the Directors proposed to beappointed / re-appointed nature of their expertise in specific functional areas and namesof other companies in which they hold Directorship along with their Membership /Chairmanship of Committees of the Board as stipulated under Regulation 36(3) of the SEBI(Listing Obligations and Disclosure Requirement) Regulation 2015 are provided in theannexure to the Notice of the Twenty Ninth Annual General Meeting being sent to themembers along with the Annual Report.

Based on the confirmations received none of the Directors aredisqualified for being appointed / reappointed as Directors in terms of Section 164 theCompanies Act 2013. During the year under review no stock options were issued to theDirectors of the Company.

All Independent Directors have given declarations that they meet thecriteria of independence as laid down under Section 149(6) of the Companies Act 2013 andthe provisions of Regulation 16(1)(b) of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015.

Shri D J Bagchi Chief Executive Officer Company Secretary and Managerunder Section 196 197 198 and as a Key Managerial Personnel under Section 203 of theCompanies Act 2013 and rules made there under continues to serve your company Shri VivekKapoor continues to serve your company as Chief Financial Officer (CFO) and a KeyManagerial Personnel under Section 203 of the Companies Act 2013.

Board Meetings

The Board during the relevant financial year had met six times on May29 2019 August 14 2019 September 14 2019 November 14 2019 December 13 2019 andFebruary 13 2020 respectively.

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

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

Auditors

Based on the recommendation of the Audit Committee the Board ofDirectors has approved the re-appointment of M/s. Chaturvedi & Partners [FRN:307068E] Chartered Accountants as the Statutory Auditors of the Company from theconclusion of Twenty-ninth (29th) Annual General Meeting until the conclusion of theThirty-first (31st) Annual General Meeting of the Company subject to approval of there-appointment by the members of the Company at the ensuing Annual General Meeting as perthe provisions of the Companies Act 2013.

The necessary resolution in this respect is being included in theNotice of the Twenty–ninth (29th) Annual General Meeting for the approval of Membersof the Company. The Company has received consent from the Statutory

Auditors and confirmation to the effect that they are not disqualifiedto be appointed as the Statutory Auditor of the Company in terms of the provisions ofCompanies Act 2013 and Rules framed thereunder.

Notes to Accounts and Auditor's Report

No adverse remark or observation is given by the Statutory Auditors.The observations made by the Statutory Auditors in their report read with the relevantnotes to accounts are complete transparent and self-explanatory and therefore do notcall for any further comments by the Board.

Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard of Directors of the Company had appointed Shri P V Subramanian Practicing CompanySecretary (CP: 2077) as the Secretarial Auditor of the Company for the financial year2019-2020. The Secretarial Audit Report for the financial year ended March 31 2020 isannexed as "Annexure - 2" to this report. The observations made by theSecretarial Auditor in his report are self explanatory and therefore do not call for anyfurther comments by the Board.

Directors' Responsibility Statement

Your Directors would like to inform that the audited accounts for theyear ended March 31 2020 are in conformity with the requirements of the Companies Act2013 and they believe that the financial statements reflect fairly the form and substanceof transactions carried out during the year and reasonably present the Company'sfinancial condition and results of operations.

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

a. in the preparation of the annual accounts for the year ended March31 2020 the applicable Accounting Standards had been followed along with properexplanation relating to material departures

b. the directors had selected such Accounting Policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company as at March 31 2020 andof the profit of the Company for that period;

c. the directors had taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;

d. the directors had prepared the annual financial statements on agoing concern basis;

e. the directors had laid down Internal Financial controls to befollowed by the company and that such internal financial controls are adequate and wereoperating effectively; and

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

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

Your Company is not engaged in any manufacturing activity and thus itsoperations are not energy Intensive and the particulars relating to conservation of energyand technology absorption as per Section 134(3) of the Companies Act 2013 read with Rule8(3) of the Companies (Accounts) Rules 2014 are not applicable. There has been noforeign exchange earnings and outgo during the year under review.

Employee Remuneration

The ratio of the remuneration of each Director to the median employeesremuneration and other particulars or details of employees pursuant to Section 197(12) ofthe Companies Act 2013 along with the names of top 10 employees in terms of remunerationdrawn read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 as amended are attached to this Report as "Annexure –1".

Maintenance of Cost Records

Maintenance of Cost Records and requirement of Cost Audit as prescribedunder the provisions of Section 148(1) of the Companies Act 2013 are not applicable forthe business activities carried out by the Company.

Prevention of Sexual harassment at Work Place

The Company has Zero tolerance towards any action on the part of anyexecutive / staff which may fall under the ambit of ‘Sexual Harassment' atworkplace and is fully committed to uphold and maintain the dignity of every womenexecutive / staff working in the company. No complaint was filed during the year in thisregard.

Corporate Governance & Management Discussion and Analysis

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

The certificate by Rahul Kumar Agarwal & Associates PracticingChartered Accountants [Membership No.:- 310116 Firm Registration No.330189E] confirmingcompliance with the conditions of Corporate Governance as stipulated in Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 forms part of this Annual Report. The said certificate for financial year 2019-20does not contain any qualification reservation or adverse remark.

Internal Control

The Company has an adequate internal audit system in place whereby TheInternal Audit is conducted by the Internal Auditor and reports are submitted on aperiodic basis. The audit function maintains its independence and objectivity whilecarrying out its assignments. It evaluates on a continuous basis the adequacy andeffectiveness of internal control mechanism adherence to policies procedures as well asregulatory and legal requirements. The function also recommends improvement in operationalprocesses and suggests streamlining of controls against various risks. The Audit Committeeof the Board reviews the internal audit function on a continuous basis.

Significant / Material Orders Passed by the Regulator or Court orTribunals

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

Change in the Nature of Business

There are no changes in the Nature of Business.

Nomination (Including Boards Diversity) Remuneration & EvaluationPolicy

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

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

Related Party Transaction Policy

Related Party Transaction Policy is intended to ensure requisiteapproval reporting and disclosure of transactions between the Company and its relatedparties. The said policy also defines the materiality of related party transactions andlays down the procedures of dealing with related party transactions.

There were no materially significant related party transactions i.e.transactions of material nature with its promoters directors or senior management ortheir relatives etc. that may have potential conflict with the interest of company atlarge. During the year the Company has not entered into any material contractarrangement or transaction with related parties as defined in the SEBI ListingRegulations and Related Party Transaction Policy of the Company. None of the Directorshave any pecuniary relationships or transactions vis--vis the Company. The Related PartyTransactions as per requirement of Indian Accounting Standard Ind AS 24 are disclosed atNote No. 36 of the Notes forming part of the Accounts in the Annual Report annexedherewith.

The Related Party Policy is available on the website of the Company atthe URL http://www.saharahousingfina.com/annualreport/related-party-transaction-policy.pdfand also forms a part of this Annual Report.

Annual Evaluation of Board Performance and Performance of itsCommittees and Individual Directors

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

The annual performance evaluations of the Board as a whole allDirectors as well as the evaluation of the Board Committees including Audit CommitteeNomination & Remuneration Committee Risk Management Committee and StakeholdersRelationship Committee of the Company were carried out. The details of evaluation processas carried out and the evaluation criteria and framework have been explained in theCorporate Governance Report forming part of this Annual Report.

Insurance of Company's Property

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

Risk Management Policy & Asset Liability Management Committee(ALCO)

The company has in place Asset Liability Committee (ALCO) whichmonitors and on an ongoing basis liquidity interest rate and funding risks to which theCompany is susceptible. Liquidity risk is caused by an asset-liability mismatch resultingfrom a difference in the maturity profile of the assets and liabilities. Unexpectedincreases in the cost of funding an asset portfolio at the appropriate maturity and therisk of being unable to liquidate a position in a timely manner at a reasonable price aresome of the triggers of this risk.

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

Corporate Social Responsibility Policy

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

Codes Standards and Policies

Know Your Customer & Anti-Money Laundering Measures

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

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

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

Fair Practice Code

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

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

Whistle Blower Policy (Vigil Mechanism)

Pursuant to the provisions of Section 177(9) & (10) of theCompanies Act 2013 read with Rule 7 of Companies (Meetings of Board and its Powers)Rules 2014 and Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 your Company has in place a Whistle Blower Policy whichprovides for a vigil mechanism that encourages and supports its Directors and employees toreport instances of illegal activities unethical behaviour actual or suspected fraud orviolation of the Company's Code of Conduct or Ethics Policy. It also provides foradequate safeguards against victimisation of persons who use this mechanism and directaccess to the Chairman of the Audit Committee in exceptional cases.

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

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

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

The said policy is available on website of the Company at the URLhttp://www.saharahousingfina.com/ Code_of_Conduct_Directors_Sr%20Mngmnt_PeRsl_REVISED_2015.pdf.

Code for Prevention of Insider Trading Practices

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

Policy in Disclosure of Material Events and Information

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

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

Policy on Preservation of Documents and Records

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

Other Policies as Per NHB Rules/Guidelines

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

Listing of Shares of the Company

The Equity Shares of your Company listed under category (Group-X) onthe BSE Ltd. The Company has paid the listing fees as payable to the BSE Ltd. for thefinancial year 2020-21.

Technology Updation

The exercise of upgradation/implementation of the system software andinformation technology so as to be in harmony with the Guidelines of National Housing Bankconcerning Information Technology Framework applicable for Housing Finance Companies basedon size and complexity is currently under progress. Its commissioning shall augment theprevalent systems and processes and also improve operational efficiencies cyber securityand governance. While the company has initiated the procurement of software and hardwareessential to give effect to the said goal the high capital outlay and manpowerallocation necessary for the purpose remain crucial factors considering the modest scaleof operations and size of your company. Nonetheless the Company is fully committed to thesaid objective and deciphering its benefits your Company is progressively allocatingfunds from internal resources. The ongoing pandemic (COVID 19) may cause some delay in itsenvisaged timely implementation but once commissioned the envisaged integratedinformation technology solution will fully strengthen the systems and processes in place.

Depository System

The Company has entered into an agreement with CDSL / NSDL fortransaction of shares in dematerialized form. As on March 31 2020 only 2.98 per cent ofthe Company's paid up Share Capital consisting of 208208 shares were held inphysical form. As per the Securities and Exchange Board of India's (SEBI)instructions the Company's shares have to be transacted in dematerialised form andtherefore members are requested to convert their holdings to dematerialised form.

Human Resources and Training

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

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

Insurance Coverage to Borrowers

Your Company in tie-up with National Insurance Company Limited offerscomprehensive insurance cover product called "National Insurance Sahara Home LoanSuraksha Bima" offering protection to the borrowers (optional) of the Companyagainst the following risks / perils / natural calamities; A. Personal Accident Insurance:Death due to accident/ accidental loss of two limbs two eyes or one limb and one eye;Permanent total disablement from injuries other than named above.

B. Property Insurance: Fire / Storm / Earthquake / Riot Strike andMalicious damage / Lightning / Explosion

/ Implosion / Aircraft damage Impact damage / Subsidence and Landslideincluding Rock Slide / Bursting or Overflowing of Water Tanks & Pipes

Missile testing operations / Leakage from Automatic SprinklerInstallations Bush Fire / other natural calamities.

The details regarding the product (e.g. Sum insured premium payableetc.) are explained to the borrowers during personal discussion with them at the time ofcredit appraisal.

Go Green Initiatives

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

Extract of Annual Return

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act2013 read with Rule 12 of the Companies (Management and Administration) Rules 2014theextract of the Annual Return as at March 31 2020 in the prescribed form MGT 9forms partof this report and is annexed as "Annexure - 3".

Acknowledgements

Your Directors wish to place on record their gratitude for thecontinued support of various authorities including the National Housing Bank SEBI BSELimited NSDL CDSL and Credit Rating Agency (Infomerics Valuation & Rating PrivateLimited) and also for support and faith reposed in the Company by the Borrowers allBankers Lenders Debenture holders Credit Rating Agency Trustees (Catalyst TrusteeshipLimited) and others.

The Board also places on record its deep appreciation for thesignificant contributions made by its employees at all levels and for their dedicationcommitment hardwork and cooperation that has been instrumental is maintaining themomentum in these challenging environment. The Board would also like to express itssincere appreciation to the Company's RTA and all Service Providers for theircontinued co-operation.

For and on behalf of the Board of Directors
(Brijendra Sahay) (Anshu Roy)
Kolkata

Director

Director

August 26 2020

(DIN 00017600)

(DIN 05257404)

.