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SRG Housing Finance Ltd.

BSE: 534680 Sector: Financials
NSE: N.A. ISIN Code: INE559N01010
BSE 00:00 | 04 Aug 183.20 2.30






NSE 05:30 | 01 Jan SRG Housing Finance Ltd
OPEN 185.00
52-Week high 240.00
52-Week low 101.20
P/E 12.64
Mkt Cap.(Rs cr) 238
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 185.00
CLOSE 180.90
52-Week high 240.00
52-Week low 101.20
P/E 12.64
Mkt Cap.(Rs cr) 238
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

SRG Housing Finance Ltd. (SRGHOUSING) - Director Report

Company director report


The Members

The Board of Directors of your Company take pleasure in presenting before you the 20thAnnual Report of the Company together with the Audited Financial Statements for thefinancial year


(Rs In Crores)
Particulars 2018-19 2017-18
Gross Income 59.49 34.26
Less: Finance Cost 23.01 11.27
Overheads 13.59 9.35
Depreciation 0.55 0.44
Provisions for Contingencies* 2.37 2.08
Profit Before Tax & Exceptional Items 19.97 11.12
Add : Exceptional Items 0.00 0.00
Profit Before Tax 19.97 11.12
Less : Tax Expenses (Including Deferred tax) 5.80 3.04
Profit After Tax 14.17 8.08
Add : Balance b/d from the previous year 11.39 5.29
Surplus available for Appropriations 25.56 13.36
Transferred to Special Reserve under Section 36(1)(viii) of The 3.20 1.95
Income Tax Act 1961 & Section 29C of the NHB Act 1987
Excess provision 0.31 0.02
Balance carried over to Balance Sheet 22.05 11.39

* The Provisions for Contingencies against Standard Assets and NPA has been routedthrough Profit & Loss Statement from financial year 2019 earlier it was appropriatedthrough Reserves. Consequently the related figures of financial year 2018 have beenrestated accordingly.

Note: Figures have been regrouped / reclassified / rearranged wherever necessarywhile preparing the above statement.


A. Lending operations & disbursement of loans:

The Loan Book as at March 31 2019 stood at Rs 281.63 Crores as against Rs200.28 Crores as at March 31 2018 registered a growth of 40.62%. As at March 31 2019 theLoan Portfolio contributing Housing loans as 73.29% (previous year 79.08%) and Loanagainst properties as 26.71% (previous year 20.92%). During the year ended March 31 2019Company recorded Loan sanctions of Rs 124.83 Crore as compared to Rs 145.96 Crorein previous year and loan disbursement was Rs 124.90 Crore as against Rs 142.82 Crore inprevious year.

B. Profits:

During the year under review your Company recorded an Operating Profit and provisionsfor contingencies) of Rs 22.34 Crore (previous year Rs 13.20 Crore) registering anYear-on-Year increase of 69.24% Profit Before Tax (PBT) of Rs 19.96 Crore (previous yearRs 11.12 Crore) registering an Year-on-Year increase of 79.50% Profit After Tax (PAT)ofRs 14.17 Crore (previous year Rs 8.08 Crore) registering an Year-on-Year increase of75.37%.


Your Directors felt it prudent to retain the earnings for the year under reviewto be ploughed back in business which shall result in further augmentation of theCompany's growth and Shareholders' (i. .Profit wealth. before


During the year under review the Authorized Share Capital of the Company increased fromRs 150000000/- (Rupees Fifteen Crore Only) divided into 15000000 (One CroreFifty Lacs only) Equity Shares of Rs 10/- (Rupees Ten) each to Rs 160000000/-(Rupees Sixteen Crore Only) divided into 16000000 (One Crore Sixty Lacs) Equity Sharesof Rs 10/- (Rupees Ten) each. Except this there were no other changes in the ShareCapital of the Company.


A. The Company did not avail any refinance during the year from National HousingBank (NHB). The refinance outstanding as at March 31 2019 amounts to Rs 3.92 Crores.

B. Banks and Financial Institutions:

The Company availed fresh credit facilities of Rs 89 Crores from multiple Banks andFinancial Institutions during the year 2018-19. The outstanding credit facilities fromBanks and Financial Institutions as at March 31 2019 amounts to Rs 233.38 Crores.

C. Non-Convertible Debentures (“NCDs”):

During the year 2018-19 the Company did not issue any NCDs. As on March 31 2019the outstanding NCDs stood at Rs 17.67 Crores.

During the year the rating assigned to NCDs continued as BWR BBB (BWR Triple B)Outlook: Stable from Brickwork Ratings the Credit Rating Agency.


In accordance with the Housing Finance Companies Issuance of Non-Convertible Debentureson private placement basis (NHB) Directions 2014 during the year under review theNon-Convertible Debentures which were issued by the Company in Financial year 2017-18 onprivate placement basis were paid/ redeemed by the Company on their respectivedue dates and there were no such instances of any Non-Convertible Debentures whichhave not been claimed by the investors or not paid by the Company after the date onwhich the Non-Convertible Debentures became due for redemption.


As at March 31 2019 dividend amounting to Rs 5025/- has not been claimed by theshareholders. The Company has been intimating the shareholders to lodge their claim fordividend from time to time.

Under the provisions of Section 124 and 125 of The Companies Act 2013 and Rules framedthereunder and Investor Education and Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 read with the relevant circulars and amendments theretodividends that remain unclaimed for a period of seven years from the date of declarationare required to be transferred to the Investor Education and Protection Fund (IEPF)administered by the Central Government.

Further as per the provisions of Section 124(6) of The Companies Act 2013 read withthe Investor Education & Protection Fund Authority (Accounting Audit Transfer &Refund) Rules 2016 the shares in respect of which the dividend has not been claimed forseven (7) consecutive years are required to be transferred by the Company to thedesignated Demat account of the IEPF Authority.

The unclaimed dividend in respect of financial 2014-15 must be claimed by shareholderson or before April 2022 failing which the Company will transfer the unclaimed dividendand the corresponding shares to the IEPF within a period of 30 days from that date.

The concerned shareholders however may claim the dividend and shares from IEPF theprocedure for which is detailed in the Shareholders' Information section of this Report.

As at March 31 2019 there is no unpaid/ unclaimed Dividend and the shares to betransferred to the Investor Education & Protection Fund.

In terms of the IEPF (Uploading of information regarding unpaid and unclaimed amountslying with Companies) Rules 2012 the Company has made the relevant disclosures to theMinistry of Corporate Affairs (MCA) regarding unpaid/unclaimed dividends. TheCompany has uploaded prescribed information on and www.srghousing. com.


Under the provisions of Section 125 of The Companies Act 2013 Matured NCDs and/orInterest thereon remaining unclaimed and unpaid for a period of seven years from the datethey became due for payment are required to be credited to Investor Education andProtection Fund (IEPF) established by the Government of India.

As at March 31 2019 there were no NCDs amount or interest thereon which remainedunclaimed and unpaid.


Pursuant to SEBI (LODR) Regulations 2015 and NHB Directions dated 9th February 2017Report on Management Discussion and Analysis is annexed herewith as “AnnexureIV”.


The Company does not have any subsidiary Company.


In pursuance of Section 134 (3) (c) read with Section 134(5) of The Companies Act2013 and based on the information provided by the management your

Directors hereby confirm that:

a. In the preparation of the annual accounts for the year ended on March 31 2019 theapplicable accounting standards have been followed along with proper explanation relatingto material departures if any;

b. Accounting policies selected were applied consistently. Reasonable and prudentjudgments and estimates were made so as to give a true and fair view of the state ofaffairs of the Company as at March 31 2019 and of the profitof the Company for the yearended on that date;

c. Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of The Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting frauds and other irregularities;

d. The annual accounts of the Company have been prepared on a going concern basis;

e. Internal Financial Controls have been laid down to be followed by the Company andsuch Internal Financial Controls were adequate and operating effectively;

f. Systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.


SRG Housing has complied with the guidelines issued by National Housing Bank (NHB)regarding accounting guidelines prudential norms for asset classification incomerecognition provisioning adequacy concentration of credit credit rating Know YourCustomer (KYC) guidelines and Anti Money Laundering (AML) standards fair practices codeand capital market exposures etc.

The company also complied with other statutory Guidelines/Directions as applicable tothe Company from time to time.

The details of compliances are outlined in the Management Discussion and AnalysisReport and Corporate Governance Section of this Report.

Compliance under the Companies Act 2013

SRG Housing has complied with the requirements of the applicable provisions of theCompanies Act 2013 and related Rules thereunder during the year.

Central registry

The Central Registry of Securitization Asset Reconstruction and Security Interest ofIndia (CERSAI) has been set up by the Government of India under Section 21 of the SARFAESIAct 2002 in order to maintain a central database of all mortgages created by lendinginstitutions. CERSAI compiles and maintains data pertaining to all transactions secured bymortgages. All banks and HFCs falling under the purview of the SARFAESI Act are requiredto register with CERSAI and submit the data in respect of all properties mortgaged in itsfavour. A fee is required to be paid by the lending Institutions for uploading the data ofmortgage. SRG Housing is registered with CERSAI and has been submitting all relevant datain respect of the loan book. We have uploaded records in respect of loans disbursed duringthe year and has paid the applicable fee.


Your Company has taken adequate steps to adhere to all the stipulations laid down inthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 CorporateGovernance (National Housing Bank) Directions 2016 dated 9th February 2017and the Companies Act 2013 and Rules thereto as amended from time to time.PursuanttotheSEBI(ListingObligationsandDisclosure Requirements) Regulations 2015 and theCorporate Governance (National Housing Bank) Directions 2016 and disclosures as requiredunder The Companies Act 2013 and the Rules thereto a separate Section titled‘Report on Corporate Governance' forms part of this Annual Report as “AnnexureV”.

The certificate by the Secretarial Auditor confirming compliance with the conditions ofCorporate Governance as stipulated in the SEBI (LODR) Regulations 2015 forms part of thisreport as “Annexure VI”.

The said certificate for financial year 2018-19 does not contain any qualificationreservation or adverse remarks.

In terms of Section 136 of The Companies Act 2013 the reports and accounts are beingsent to the members and others entitled thereto.


All contracts / arrangements / transactions entered by the Company with related partiesare in the ordinary course of business and on an arm's length basis. Your Directors drawattention of the Members to Note no. 32.11 to the Financial Statements which sets outrelated party disclosures and all the related party transactions are within the limit asapproved by the Shareholders in the Special Resolution passed in the 17thAnnual general Meeting held on 22.08.2016.

During the year the Company had not entered into any contract / arrangement /transaction with related parties which could be considered material in accordancewith Section 188 of Companies Act 2013 accordingly information in Form AOC-2 isnot annexed. Pursuant to Corporate Governance (National Housing Bank) Directions 2016dated February 9 2017 a policy on transactions with related parties is given as “AnnexureIII” to this report.

All related party transactions are approved by Audit Committee or Board or members at ageneral meeting as applicable.

The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website at thelink:- ( download/RELATED%20PARTY%20TRANSACTION%20POLICY.pdf)


Pursuant to Section 134 (3) (n) of The Companies Act 2013 The SEBI (LODR)Regulations 2015 and NHB circular on Corporate Governance the Company has in place arisk management framework approved by the Board of Directors.

SRG Housing's Risk Management framework provides the mechanism for risk assessment andmitigation. Company has in place Risk Management Committee.

The details of the Committee and its terms of reference are set out in the CorporateGovernance Report forming part of the Board's Report.

At present the Company has not identified any element of risk which may threaten theexistence of the Company.


SRG Housing has in place Asset Liability Management Policy approved by Board. The AssetLiability Management Committee is entrusted with the task to oversee the Asset liabilityposition of the Company on a periodic basis. The Asset Liability Management Committeecomprises of Managing Director and members of Senior Management.


In accordance with the provisions of Section 135 of The Companies Act 2013 and therules framed thereunder the Company has a Corporate Social Responsibility Committee ofdirectors comprising Mr. Nishant Badala Independent Director- Chairman Mr. Vinod K.Jain Managing Director- Member and Mrs. Seema Jain Director- Member and has inter aliaalso formulated a CSR Policy. The role of the CSR Committee is to review the CSR policyindicate activities to be undertaken by the Company towards CSR activities and formulate atransparent monitoring mechanism to ensure implementation of projects and activitiesundertaken by the Company towards CSR activities.

The Annual Report on CSR activities including brief contents are provided as “AnnexureIX” to this report.


The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined by board. To maintain its objectivity and independence the Internal Auditorreports to the Chairman of the Audit Committee of the Board and/or to the ManagingDirector.

The Internal Auditor monitors and evaluates the efficacy and adequacy of InternalControl System in the Company its compliance with operating systems accountingprocedures and policies of the Company.

Based on the report of Internal Auditor respective heads undertake corrective actionin their respective areas and thereby strengthen the controls. Significant auditobservations and recommendations along with corrective actions thereon are presented tothe Audit Committee of the Board and/or to the Managing Director.


During the year the terms of appointment of Mr. Vinod K. Jain ManagingDirector of the Company was revised by the Shareholders vide Postal Ballot resultsdeclared dated 24th December 2018 in terms of the provisions of Section 197 and SectionII of Part II of Schedule V of The Companies Act 2013 as amended by The CompaniesAmendment Act 2017 for the payment of Managerial Remuneration in excess of the limitsprescribed under Section 197 and Section II of Part II of Schedule V of TheCompanies Act 2013.

During the year Ms. Garima Soni was appointed as a non-executive director of thecompany with effect from 23.02.2019 and is liable to retire by rotation. Theappointment was made by the Shareholders vide Postal ballot results declared dated23rd February 2019.

In accordance with the provisions of The Companies Act 2013 and the Articles ofAssociation of the Company Mrs. Seema Jain Non-Executive Director being the longestinoffice among directors who are liable to retire by rotation retires by rotation andbeing eligible; offers herself for re-appointment at the ensuing 20th AnnualGeneral Meeting.

The tenure of Mr. Vinod K. Jain Managing Director has been ended on 6th May 2019.Considering his remarkable efforts and strategies which contributed towards the continuedgrowth of the Company and fit and proper criteria for reappointment as per CorporateGovernance (National Housing Bank) Directions 2016 the Nomination and Remunerationcommittee recommended his re-appointment as the Managing Director of the Company and theboard of Directors in their meeting held on 6th May 2019 approved his reappointment as theManaging Director of the Company for a further period of 3 years subject to approval ofthe Members in the ensuing 20th Annual General Meeting on such terms andconditions as approved by members.

The tenure of Mr. Ashok Kabra and Mr. Vikas Gupta Independent Directors of the Companywill come to end on the conclusion of ensuing 20th Annual General Meeting ofthe Company. Considering their knowledge and expertise and fit and proper criteria forreappointment as per Corporate Governance (National Housing Bank) Directions 2016 theNomination and Remuneration Committee proposed their reappointment for further period of 5years i.e. upto the conclusion of 25th Annual General Meeting of the Company tobe held in the financial year 2024 in terms of Section 149(10) of the Companies Act2013.

The necessary resolution for re-appointment of the aforesaid directors and theirdetailed profile has been included in the Notice conveying the ensuing 20thAnnual General Meeting.

All the Directors of the Company have confirmed that they are not disqualified frombeing appointed as Directors in terms of Section 164 of The Companies Act 2013.

There were no changes in Key Managerial Personnel during the financial year.

Details of managerial remuneration as required under Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are given as per “AnnexureVIII” to this report.


The Company has received necessary declaration from each Independent Director of theCompany under Section 149(7) of The Companies Act 2013 and Regulation 25(8) of SEBI(LODR) Regulations 2015 that the Independent Directors of the Company meet with thecriteria of their Independence as laid down in Section 149(6) and Regulation 16(1)(b) ofSEBI (LODR) 2015.



Pursuant to the provisions of Section 139 142 and all other applicable provisions ofthe Companies Act 2013 and Rules made thereunder M/s. PKJ & Co. CharteredAccountants (Registration No. 124115W) appointed by the members at the 18thAnnual General Meeting held on September 30 2017 as the statutory Auditor of the Companyfor a period of five years upto the conclusion of 23rd Annual General Meetingto be held in year 2022 will continue as the Statutory Auditors of the Company on suchterms and conditions as may be decided by the Board.

The requirement of placing the matter relating to such appointment for ratification bymembers at every annual general meeting has been dispensed with due to omission of thefirst proviso to Section 139(1) by the Companies (Amendment) Act 2017 effective fromMay072018asperthe of Corporate Affairs Govt. of India [File No.1/1/2018-CL.I dated May07 2018] and consequently in the 19th AGM of the Company approval of theShareholders have been obtained for his term of five year till the conclusion of 23rdAnnual General Meeting of the Company without ratification at every Annual GeneralMeeting.

Accordingly the notice convening the ensuing Annual General Meeting does not carry anyresolution on ratification of the appointment of the Statutory Auditors.

The Statutory Auditors have audited the books of accounts of the Company for thefinancial year ended March 31 2019 and have issued the Auditors' Report thereon.

Secretarial Auditors:

M/s Deepak Vijaywargey & Associates Practicing Company Secretary Udaipur wasre-appointed as the Secretarial Auditor of the Company for the financial year 2018-19 bythe Board of Directors pursuant to provisions of The Companies Act 2013 and Rules framedthere under. Secretarial Audit Report as provided by M/s Deepak Vijaywargey &Associates Practicing Company Secretary is annexed to this Report as “AnnexureI”.


There are no qualifications reservations or adverse remarks or disclaimer made-

(a) By the Statutory Auditor in his report; and

(b) By the Company Secretary in Practice in his Secretarial Audit Report.



The Board of Directors met 18 times during the financial year 2018-19. The details ofwhich are mentioned in the Report of Directors on Corporate Governance forming part ofthis Annual Report.


The Audit Committee consists of adequate composition of Non-Executive IndependentDirectors.

The details of which are mentioned in the Report of Directors on Corporate Governanceforming part of this Annual Report.


The Nomination & Remuneration Committee consists of adequate composition ofNon-Executive Independent Directors and Non-Executive Directors.

The details of which are mentioned in the Report of Directors on Corporate Governanceforming part of this Annual Report.


The Stakeholder's Relationship Committee consists of adequate composition of Non-Executive Directors and Non-Executive Independent Directors. The details of which arementioned in the Report of Directors on Corporate Governance forming part of thisAnnual Report.


Since the Company is a Housing Finance Company the disclosure regarding particulars ofloan given and security provided in the ordinary course of business is exempt under theprovisions of Section 186 (11) of The Companies Act 2013.

As regards investment made by the Company the details of the same are provided underNote no. 13 forming part of Financial Statements of the Company for the year ended March31 2019.


(A) Conservation of energy:

The Company's operations are not power intensive. Nevertheless your Company is takingevery step to conserve and minimize the use of energy wherever possible such as usingenergy efficient computer terminals purchasing energy efficient equipment's etc.

(B) Technology absorption:

The Company has imported no technology.

Indigenous technology available is continuously upgraded to improve overallperformance.

(C) Expenditure incurred on research and development:

The Company has no formal research and development department but the Company iscontinuously making efforts to strengthen research and development activities to improvequality and reduce cost.

(D) Foreign exchange earnings and Outgo:

During the year under review there were no earnings and outgo in foreign exchange.


Since the Company is into housing finance the Company is not required to maintain costrecords as specified by the Central Government under 148 (1) of the Companies Act 2013.


As required pursuant to Section 92(3) of The Companies Act 2013 and Rule 12(1) of TheCompanies (Management and Administration) Rules 2014 the details forming part of extractof annual return in MGT-9 is annexed herewith as “Annexure II” andpursuant to Section 134 (3) (a) of the said Act the same has also been placed on thewebsite of the Company at


As at March 31 2019 the Company had 1 employee employed throughout the year who wasin receipt of remuneration of more than Rs 1.02 crores per annum. Except this no otheremployee employed throughout the year that was in receipt of remuneration of Rs 1.02crores or more per annum or Rs 8.50 lacs or more per month if employed for part of theyear. Disclosures on managerial remuneration are annexed to this report.


There are no material changes and commitments position of the Company between affectingfinancial March 31 2019 and the date of Board's Report.


There are no changes in the nature of business.


The Company has been granted registration by the National Housing Bank as a non-deposittaking Housing Finance Company. Being so the Company has neither accepted in the past norhas any future plans to accept any public deposits by whatever name called.


The Company has been following directions guidelines circulars issued by SecuritiesExchange Board of India Bombay Stock Exchange Ministry of Corporate Affairs NationalHousing Bank etc. from time to time relating to Companies and that there are nosignificant & material orders passed by these regulators so far.


Details of Managerial remuneration as required under Rule 5(1) of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 read with The Companies(Appointment and section Remuneration of Managerial Personnel) Amendment Rules 2016 isgiven as “Annexure VIII” to this report.


The Company confirms that it has paid the Annual Listing Fees for the year 2018-2019 toBSE where the Company's securities are listed.


During the year Company has not received any investor complaints and that as on date noinvestor complaints are pending.


The Earnings per Share (EPS) is Rs 10.90 as at March 31 2019 as against Rs 6.21 as atMarch 31 2018.


Particulars as on March 31st 2019 2018
Capital Adequacy Ratio 30.27% 33.38%

SRG Housing's capital adequacy in the form of CRAR stood at 30.27 % as of March 312019 which is well above the NHB's minimum stipulated requirement of 12% in the form ofTier I and Tier II Capital. High Tier I Capital shall provide the Company adequateheadroom to raise Tier II Capital for future business expansion. This position enables theCompany to expand the loan book significantly by debt route.


The Company adhered to the prudential guidelines for Non-Performing Assets (NPAs)issued by the National Housing Bank (NHB) under its Directions of 2010 as amended fromtime to time. As per the prudential norms the income on such NPAs is not to be recognizedif unrealized.

As per the prudential norms prescribed by the NHB the Company has made provision forcontingencies on standard as well as non-performing housing loans and property loans. TheCompany's policy is to provide provisions towards NPA and for standard assets as per NHBguidelines. However by way of prudence and abundant caution Company has providedadditional provision over and above the NHB guidelines and as on 31st March 2019 hasmaintained cumulative NPA provision of Rs 4.26 Crores (Previous year Rs 2.02 Crores).

Further for standard assets Company carries provision of Rs 0.87 Crores (Previous yearRs 0.73 Crores).


The Directors of the Company place on record their appreciation for the adviceguidance and support given by various regulatory authorities including the NationalHousing Bank (NHB) Reserve Bank of India (RBI) Securities and Exchange Board of India(SEBI) Ministry of Corporate Affairs (MCA) Stock Exchange (BSE) Depositories (NSDL& CDSL) Debenture Trustees Debenture Holders and all the bankers and Lenders of theCompany. The Directors would also like to acknowledge the role of all its stakeholders– shareholders borrowers key partners and lenders for their continuing support tothe Company. Directors also record their appreciation for the dedicated services of theemployees and their contribution to the growth of the Company. The Board would also liketo express its sincere appreciation to all the Company's valued Shareholders Registrar& Share Transfer Agent

Rating agencies local/ statutory authorities Service Providers and Counselors fortheir continued support and patronage.

Best Wishes
Vinod K. Jain Seema Jain
Managing Director Director
DIN: 00248843 DIN: 00248706
Date: - 29.05.2019
Place: - Udaipur