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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
CONTENTS OF ANNUAL REPORT FOR FINANCIAL YEAR 2015-16
S.
No.
Particulars Page Nos
1. Notice 1-5
2. Explanatory Statement to Notice 6-14
3. Directors’ Report 15-26
4. Annexure I to Directors’ Report - Secretarial Audit Report 27-29
5. Annexure II to Directors’ Report - AOC-2 30-31
6. Annexure III to Directors’ Repot - MGT-9 32-40
7. Independent Auditor’s Report 41-50
8. Balance Sheet, Profit and Loss along with Significant Accounting Policies
and Notes
51-89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 NOTICE
Notice is hereby given that the SEVENTH ANNUAL GENERAL MEETING of the Company will be held at the registered office of the Company at D-305, Ground Floor, Sarvodaya Enclave, New Delhi - 110017 on Monday the 8th day of August, 2016 at 11.00 A.M. at to transact the following business:
ORDINARY BUSINESS:
1. To receive, consider and adopt the audited Accounts of the Company for the year ended 31st
March, 2016, together with the Directors’ and Auditor's Reports.
2. To appoint a Director in place of Mr. Sandeep Marian Farias, Nominee Director of the Company, who retires by rotation and being eligible, offers himself for re-appointment.
3. To appoint a Director in place of Mr. Rahul Chandra, Nominee Director of the Company, who retires by rotation and being eligible, offers himself for re-appointment.
4. To ratify the appointment of auditors and to fix their remuneration and if thought fit to pass,
with or without modification(s), the following resolution as an Ordinary Resolution:
“RESOLVED THAT, subject to approval of shareholders, M/s B S R & Associates LLP, Chartered Accountants, FRN-116231 W/ W-100024, from whom certificate pursuant to section 139 of the Companies Act, 2013 has been received, be and hereby appointed as the Statutory Auditors of the Company to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting of the Company at such remuneration plus service tax, out-of-pocket, travelling and living expenses, etc., as may be mutually agreed between the Board of Directors of the Company and the Auditors.”
SPECIAL BUSINESS:
5. To approve the Appointment of Mr. Ajay Oak as Whole Time Director of the Company:
To consider and if thought fit to pass, with or without modification(s), the following resolution as a Special Resolution:
“RESOLVED THAT pursuant to Section 196, 197 and 203 read with Schedule V of the Companies Act, 2013 and other applicable provisions, if any, (“including any statutory
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
modification(s) or re-enactment thereof) and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and subject to approval of the Central Government and such other consents and permission as may be required, the consent of the member be and is hereby accorded to approve the appointment of Mr. Ajay Oak (holding DIN 01779000) as the Whole-Time Director of the Company for a period of 5 years commencing from July 27, 2016 till July 26, 2021 at a consolidated remuneration not exceeding Rs. 150,00,000 /- (Rupees one crore and fifty lacs) per annum inclusive of remuneration(s) payable directly or otherwise or by way of salary and perquisites, performance based rewards/ incentives, on the terms and conditions as decided by the Board and/or Recruitment, Compensation and Nomination Committee with the power to alter and vary the terms and conditions of the said appointment in such manner as may be agreed between the Board and/or Recruitment, Compensation and Nomination Committee and Mr. Ajay Oak.”
“RESOLVED FURTHER THAT, in the event of no profits or inadequacy of profits in any financial year during the currency of term of Mr. Ajay Oak, the Company shall pay Mr. Ajay Oak, the existing remuneration as minimum remuneration by way of salary, perquisites and / or allowance, performance based rewards/ incentives exceeding the limit laid down in Schedule V to the Companies Act, 2013, as applicable to the Company or such other limits, as may be prescribed by the Central Government from time to time as to minimum remuneration and in compliance with provisions stipulated therein.” “RESOLVED FURTHER THAT the Board of Directors be and are hereby authorized to do and perform all such acts, deeds, matters and things, as may be considered necessary, desirable or expedient to give effect to this resolution, including to delegate this power.”
6. To approve the Appointment of Mr. Sanjay Chaturvedi as Whole Time Director of the Company:
To consider and if thought fit to pass, with or without modification(s), the following resolution as a Special Resolution: “RESOLVED THAT pursuant to Section 196, 197 and 203 read with Schedule V of the Companies Act, 2013 and other applicable provisions, if any, (“including any statutory modification(s) or re-enactment thereof) and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and subject to approval of the Central Government and such other consents and permission as may be required, the consent of the member be and is hereby accorded to approve the appointment of Mr. Sanjay Chaturvedi (holding DIN 01636432) as the Whole-Time Director of the Company for a period of 5 years commencing from July 27, 2016 till July 26, 2021 at a consolidated remuneration not exceeding Rs. 150,00,000 /- (Rupees one crore and fifty lacs) per annum inclusive of remuneration(s) payable directly or otherwise or by way of salary and perquisites, performance based rewards/ incentives, on the terms and conditions as decided by the Board and/or Recruitment, Compensation and Nomination Committee with the power to alter and vary the terms and conditions of the said appointment in such manner as may be agreed between the Board and/or Recruitment Compensation and Nomination Board Committee and Mr. Sanjay Chaturvedi.” “RESOLVED FURTHER THAT, in the event of no profits or inadequacy of profits in any financial year during the currency of term of Mr. Sanjay Chaturvedi, the Company shall pay Mr. Sanjay Chaturvedi, the existing remuneration as minimum remuneration by way of
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
salary, perquisites and / or allowance, performance based rewards/ incentives exceeding the limit laid down in Schedule V to the Companies Act, 2013, as applicable to the Company or such other limits, as may be prescribed by the Central Government from time to time as to minimum remuneration and in compliance with provisions stipulated therein.” “RESOLVED FURTHER THAT the Board of Directors be and are hereby authorized to do and perform all such acts, deeds, matters and things, as may be considered necessary, desirable or expedient to give effect to this resolution, including to delegate this power.”
7. To approve the Related Party Transaction:
To consider and if thought fit, to pass with or without modification(s), the following
resolution as a Special Resolution: “RESOLVED THAT pursuant to the provisions of Sections 188(1) of the Companies Act, 2013 and other applicable provisions, if any, including statutory modification or re-enactment thereof, the consent of the Company be and is hereby accorded to Ms. Rupa Basu, who is a relative of Mr. Ajay Oak, Director, to be appointed as an employee of the Company (i.e., to hold an office or place of profit under the Company) from November 6, 2015, with such designation as the Board of Directors of the Company may, from time to time, decide, on the following terms and conditions:
1) Salary Rs. 70,00,000 (Rupees seventy lacs only) per annum for the period 06.11.2015 to 31.03.2016 and Rs. 73,50,000 /- (Rupees Seventy Three Lacs Fifty Thousand only) per annum for the period 01.04.2016 to 31.03.2017 and be broken into various components as per HR policy of the Company, from time to time.
2) Statutory perquisites and other benefits like gratuity, contribution to provident fund, bonus and leave encashment etc., as per the applicable provision of relevant statutes and/or policies of the Company will be in addition to the aforesaid remuneration.
3) The Company will reimburse telephone and/or mobile phone(s) bills, conveyance, fuel expenses or other out of pocket expenses incurred in the course of official duties which will not be included in the aforesaid remuneration.
RESOLVED FURHTER THAT the Board of Directors shall have the authority from time to time -
(a) to make applicable to Ms. Rupa Basu such revisions in the aforesaid salary scale or grade together with revisions in such allowances, benefits, amenities, facilities and other perquisites including contribution to provident fund, gratuity fund, superannuation fund, if any, etc. as are introduced from time to time in respect of employees of the Company in equivalent salary scale or grade; and
(b) to promote/change her position/designation or salary scale or grade in due course together with such allowances.
RESOLVED FURTHER THAT the Board of Directors and/or Company Secretary of the Company be and they are hereby severally authorised to take, perform and execute such further steps, acts, deeds and matters, as may be necessary, proper or expedient to give effect to this resolution.”
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 8. Fixation of the term of Mr. Vinod Rai, Independent Director of the Company
To consider and if thought fit to pass, with or without modification(s), the following resolution as
an Ordinary Resolution: “RESOLVED that, pursuant to the provisions of sections 149, 152 of the Companies Act, 2013 (Act) and the Rules framed thereunder, read with Schedule IV to the Act and other applicable provisions, if any, as amended from time to time, consent of the Members be and is hereby accorded to vary the terms of appointment of Mr. Vinod Rai (DIN 01119922), Independent Director in such a way that he shall not be liable to retire by rotation and shall hold office for a consecutive term of five years commencing from July 27, 2016.
9. Fixation of the term of Mr. Rakesh Rewari, Independent Director of the Company
To consider and if thought fit to pass, with or without modification(s), the following resolution as an Ordinary Resolution: “RESOLVED that pursuant to the provisions of sections 149, 152 of the Companies Act, 2013 (Act) and the Rules framed thereunder, read with Schedule IV to the Act and other applicable provisions, if any, as amended from time to time, consent of the Members be and is hereby accorded to vary the terms of appointment of Mr. Rakesh Rewari (DIN 00286853), Independent Director in such a way that he shall not be liable to retire by rotation and shall hold office for a consecutive term of five years commencing from July 27, 2016.
10. Fixation of the term of Ms. Ranjana Agarwal, Independent Director of the Company
To consider and if thought fit to pass with or without modification(s) the following resolution as an Ordinary Resolution:
“RESOLVED that pursuant to the provisions of sections 149, 152 of the Companies Act, 2013 (Act) and the Rules framed thereunder, read with Schedule IV to the Act and other applicable provisions, if any, as amended from time to time, consent of the members be and is hereby accorded to vary the terms of appointment of Ms. Ranjana Agarwal (DIN 03340032), Independent Director in such a way that she shall not be liable to retire by rotation and shall hold office for a consecutive term of five years commencing from July 27, 2016.
11. To consider and if thought fit, to pass the following resolution, with or without modification, as a Special Resolution:
“RESOLVED THAT pursuant to section 14 of the Companies Act, 2013 and the rules made there under, consent of the Members be and is hereby accorded to alter the Articles of Association of the Company by substitution of the existing clause 56.9 of the Article of Association of Company with the following:
56.9. Reserved Matter - Investor Super Majority Item Any appointment, engagement, removal, termination or increase in compensation of directors, chief executive officer, chief operating officer and other employees whose remuneration is in excess of INR 50,00,000 (Fifty lacs) per annum.
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
FURTHER RESOLVED THAT Mr. Ajay Mukund Oak and Mr. Sanjay Chaturvedi, Directors of the Company and Ms. Neeta Kamra, Company Secretary of the Company, be and are hereby severally authorized, on behalf of the Company, to do all acts, deeds, matters and things as deem necessary, proper or desirable and to sign and execute all necessary documents, applications and returns for the purpose of giving effect to the aforesaid resolution along with filing of necessary E-form as return of appointment with the Registrar of Companies, NCT of Delhi and Haryana.” By Order of the Board
For Shubham Housing Development Finance Company Limited
Sd/- (Neeta Kamra)
Company Secretary Membership No. : ACS 22892 Add: Shubham House, 425, Udyog Vihar,
Phase IV, Gurgaon-1220015 Place: Gurgaon Date: 27.07.2016
NOTES:
1. EVERY MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND SUCH A PROXY NEED NOT BE A MEMBER OF THE COMPANY.
2. THE PROXY IN ORDER TO BE EFFECTIVE SHOULD BE RECEIVED BY THE COMPANY NOT LESS THAN 48 HOURS BEFORE THE COMMENCEMENT OF THE MEETING.
3. AN EXPLANATORY STATEMENT PURSUANT TO PROVISIONS OF SECTION 102 OF THE COMPANIES ACT, 2013, IS ANNEXED AND FORMS PART OF THE NOTICE.
4. THE ROAD MAP TO THE VENUE OF THE ANNUAL GENERAL MEETING IS ENCLOSED HEREWITH.
By Order of the Board
For Shubham Housing Development Finance Company Limited
Sd/- (Neeta Kamra) Company Secretary
Membership No. : ACS 22892 Add: Shubham House, 425, Udyog Vihar,
Phase IV, Gurgaon-1220015 Place: Gurgaon Date: 27.07.2016
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT,
2013Special Business
Item No. 5
Your Board recommends to re-appoint Mr. Ajay Oak as Key Managerial Personnel of the Company as
per Section 203 of the Companies Act, 2013. The Board of Directors at its meeting held on July 27, 2016, has recommended to re-appoint Mr. Ajay Oak as Whole-Time Director of the Company on the remuneration as recommended by the Appointment, Recruitment, Compensation and Nomination Committee for a further period of 5 years, commencing from July 27, 2016 up to July 26, 2021, subject to necessary approvals. The Board has further authorised Recruitment, Compensation and Nomination Committee to approve the revision in the remuneration from time to time within the limit as approved by the Board of Directors. In terms of Rule 7 (2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company, being Debt listed, is required to obtain the approval of the Central Government, Ministry of Corporate Affairs, if the remuneration paid to its Whole Time Director/ Executive Director exceeds the limits specified under Section 196 and 197 read with Schedule V and applicable rules of the Companies Act, 2013.
The appointment of Mr. Ajay Oak is in the best interest of the Company. Thus, the Board of Directors recommends the resolution set out at Item No. 5 of the Notice for your approval.
The remuneration payable to the above mentioned Director is given below:
(i) Fixed Compensation: Up to a maximum of Rs. 70,00,000/- (Rupees Seventy Lacs) excluding Performance Linked Variable Remuneration (PLVR) for the FY 2016-17 (subject to changes made from time to time) and going upto the maximum of Rs 150,00,000/- (One Crore and Fifty Lacs) for the FY 2020-21 (subject to changes made from time to time).
Performance Linked Variable Remuneration (PLVR):
Performance Linked Variable Remuneration according to the Scheme of the Company for each of the financial years as may be decided by the Recruitment, Compensation and Nomination Committee and/or Board of Directors of the Company, based on the performance of the above mentioned Director for each year subject to a maximum of Rs. 30,00,000/- (Rupees Thirty Lacs) for the FY 2016-
17 (subject to changes made from time to time) and going upto the maximum of Rs 45,00,000/- (Rs. Forty Five Lacs) for the FY 2020-21 (subject to changes made from time to time).
The following additional detailed information as per Section - II of Schedule V is as follows:
I. General Information
a) Nature of Industry Housing Finance Sector
b) Date or expected date of commencement of commercial production.
The Company was incorporated in 2010 and has been operative since then
c) In case of new companies, expected date of Not Applicable
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Annual Report 2015-16
commencement of activities as per project approved by financial institutions appearing in the prospectus.
d) Financial performance based on given indicators
Financial year 2015-16 Gross Revenue : 106.90 Crs. Profit after Tax : 6.92 Crs. Rate of Dividend : Nil Earnings per Share: 83.92 per share
e) Foreign investments or collaborators, if any The Company has not made any foreign investments and neither entered into any foreign collaborations.
II. Information about the appointee:
a) Background Details Mr. Ajay Oak holds a Master Degree in Management. Mr. Ajay has over 19 years of corporate experience, with proven expertise in consumer lending, general management, sales & distribution, P&L Management, strategy and business development. In his previous role, Mr. Ajay was the Consumer Lending Head at Reliance Retail Finance Ltd. In this role he successfully implemented the model to deliver small ticket consumer finance to the mass market across urban and rural centres. Prior to this, Mr. Ajay worked for Citibank Global Consumer Group in India for 10 years till 2006.
b) Past Remuneration The remuneration drawn by Mr. Ajay Oak during the past two years is as follows:
Year Remuneration (In Rs.)
2015-2016 60,58,154/-p.a.
2014-2015 52,40,000/- p.a.
c) Recognition or awards NIL
d) Job profile and his suitability He is the Executive Director of the Company and devotes whole time attention to the management of the affairs of the Company and exercises powers under the supervision and superintendence of the Board of the Company
e) Remuneration proposed It is proposed to pay consolidated remuneration to Mr. Ajay Oak up to Rs. 150,00,000 /- per annum (Rupees One Crore Fifty Lacs) per annum by way of salary and perquisites, performance based rewards/ incentives etc.
f) Comparative remuneration profile with respect to industry, size of the Company, profile of the position and person
Considering the responsibility shouldered by him of the enhanced business activities of the Company, proposed remuneration is Commensurate with Industry standards and Board level positions held in similar sized and similarly positioned businesses.
g) Pecuniary relationship directly or indirectly with the Company, or relationship with the managerial personnel, if any
Beside the remuneration paid/payable to Mr. Ajay Oak, he is the promoter of the Company and holds 250000 equity shares in the Company. Apart from
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
this he does not have any other pecuniary
relationship with the Company or with any managerial personnel except Mrs Rupa Basu, his wife.
III. Other Information a) Reasons of loss or inadequate profits Not Applicable
b) Steps taken or proposed to be taken for improvement
Not Applicable
c) Expected increase in Productivity and profits in measurable terms
Not Applicable
Information pursuant to 1.2.5 of the Secretarial Standard on General Meetings (SS- 2) regarding
Director seeking appointment / re-appointment
Age 43 years
Qualifications MBA from Jamnalal Bajaj Institute of Management Studies
Experience More than 19 Years
Terms and conditions of appointment or re- appointment
a) Tenure of this appointment shall be five years with effect from July 27, 2016.
b) The Whole Time Director of the Company shall not be liable to retire by rotation. The Whole Time Director would be employed on a whole-time basis and will not be permitted to undertake any other business, work or public office, honorary or remunerative, except with the written permission of the Competent Authority in each case.
c) The Whole Time Director shall be entitled to such other privileges, allowance, facilities and amenities in accordance with rules and regulations as may be applicable to other employees of the Company and as may be decided by the Board, within the overall limits prescribed under the Act
d) Whole Time Director will cease to be Director on cessation of his employment with the Company
e) The appointment shall be governed by Section 196, 197, 203 read with Schedule V of the Companies Act, 2013 and rules made thereunder
Last drawn remuneration Rs. 60,58,154 /- p.a. Date of first appointment on the Board 23rd February 2010
No. of share held 250000 Equity Shares
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Relationship with Directors, Managers & KMP Not Related
Number of Board Meeting attended during FY 2015
4
Other Directorship Nil Chairman/ Member of the Committees of Boards of other companies
Shubham Housing Development Finance Company Limited
Member Credit Committee Banking & Borrowing Committee Risk Management Committee
Permanent Invitee Recruitment, Compensation and Nomination Committee
Except, Mr. Ajay Oak, no Directors, Key Managerial Personnel or their relatives are interested or concerned in the resolution relating to appointment of Mr. Ajay Oak.
Item No. 6
Your Board proposes to re-appoint Mr. Sanjay Chaturvedi as Key Managerial Personnel of the Company as per Section 203 of the Companies Act, 2013 The Board of Directors at its meeting held on July 27, 2016, have recommended to re-appoint Mr. Sanjay Chaturvedi as Whole-Time Director of the Company on the remuneration as recommended by the Recruitment, Compensation and Nomination Committee for a further period of 5 years, commencing from July 27, 2016 up to July 26, 2021 subject to necessary approvals. The Board had further authorised Recruitment, Compensation and Nomination Committee to approve the revision in the remuneration from time to time within the limit as approved by the Board. In terms of Rule 7 (2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company, being Debt listed, is required to obtain the approval of the Central Government, Ministry of Corporate Affairs, if the remuneration paid to its Whole Time Director/ Executive Director exceeds the limits specified under Section 196, 197 read with Schedule V and applicable rules of the Companies Act, 2013.
The appointment of Mr. Sanjay Chaturvedi is appropriate and in the best interest of the Company. Thus, the Board of Directors recommends the resolution set out at Item No. 6 of the notice for your approval
The remuneration payable to the abovementioned Director is given below:
(i) Fixed Compensation: Up to a maximum of Rs. 70,00,000 /- (Rupees Seventy Lacs) excluding Performance Linked Variable Remuneration (PLVR) for the FY 2016-17 (subject to changes made from time to time) and going upto the maximum of Rs 1,50,00,000 (One Crore and Fifty Lacs) for the FY 2020-21 (subject to changes made from time to time).
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 Performance Linked Variable Remuneration (PLVR): Performance Linked Variable Remuneration according to the Scheme of the Company for each of the financial years as may be decided by the Recruitment, Compensation and Nomination Committee /Board of Directors of the Company based on the performance of the above mentioned Director for each year subject to a maximum of Rs. 30,00,000 /- (Rupees Thirty Lacs)for the FY 2016-17 (subject to changes made from time to time) and going upto the maximum of Rs 45,00,000 (Rs. Forty Five Lacs) for the FY 2020-21 (subject to changes made from time to time).
The following additional detailed information as per Section - II of Schedule V is as follows:
IV. General Information
a) Nature of Industry Finance Sector
b) Date or expected date of commencement of commercial production.
The Company was incorporated in 2010 and has been operative since then
c) In case of new companies, expected date of commencement of activities as per project approved by financial institutions appearing in the prospectus.
Not Applicable
d) Financial performance based on given indicators
Financial year 2015-16 Gross Revenue : 106.90 Crs. Profit after Tax : 6.92 Crs. Rate of Dividend : Nil Earnings per Share: 83.92 per share
e) Foreign investments or collaborators, if any The Company has not made any foreign investments and neither entered into any foreign collaborations.
f) Information about the appointee:
h) Background Details Mr. Sanjay Chaturvedi holds a Master Degree in Business Administration. Mr. Sanjay has over 26 years of proven expertise in general management, sales & distribution, new category development, brand management and backend operations including collections across large, blue chip financial services organisations. He has successfully launched and led new business lines for the consumer business of Citibank, HSBC and GE Consumer Finance in India and First Gulf Bank in the UAE. Prior to this, his role was to set up and manage the Lending and Payments business for Reliance Retail.
i) Past Remuneration The remuneration drawn by Mr. Sanjay Chaturvedi during the past two years is as follows:
Year Remuneration (Rs.)
2015-2016 60,29,414/- p.a.
2014-2015
j) Recognition or awards NIL
k) Job profile and his suitability He is the Executive Director of the Company and devotes whole time attention to the management of the affairs of the Company and
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
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exercises powers under the supervision and
superintendence of the Board of the Company
l) Remuneration proposed It is proposed to pay consolidated remuneration to Mr. Sanjay Chaturvedi up to Rs. 150,00,000 /- per annum (Rupees One Crore Fifty Lacs) per annum by way of salary and perquisites, performance based rewards/ incentives etc.
m) Comparative remuneration profile with respect to industry, size of the Company, profile of the position and person
Considering the responsibility shouldered by him of the enhanced business activities of the Company, proposed remuneration is Commensurate with Industry standards and Board level positions held in similar sized and similarly positioned businesses.
n) Pecuniary relationship directly or indirectly with the Company, or relationship with the managerial personnel, if any
Beside the remuneration paid/payable to Mr. Sanjay Chaturvedi, he also holds 250000 equity shares in the Company and apart from this he does not have any other pecuniary relationship with the company or with any managerial personnel
g) Other Information
d) Reasons of loss or inadequate profits Not Applicable
e) Steps taken or proposed to be taken for improvement
Not Applicable
f) Expected increase in Productivity and profits in measurable terms
Not Applicable
Information pursuant to 1.2.5 of the Secretarial Standard on General Meetings (SS- 2) regarding
Director seeking appointment / re-appointment
Age
Qualifications MBA from Lucknow University
Experience More than 26 Years Terms and conditions of appointment or re- appointment
f) Tenure of this appointment shall be five years with effect from July 27, 2016.
g) The Whole Time Director of the Company shall not be liable to retire by rotation. The Whole Time Director would be employed on a whole-time basis and will not be permitted to undertake any other business, work or public office, honorary or remunerative, except with the written permission of the Competent Authority in each case.
h) The Whole Time Director shall be entitled to such other privileges, allowance, facilities and amenities in accordance with rules and regulations as may be applicable to other
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employees of the Company and as may be
decided by the Board, within the overall limits prescribed under the Act
i) Whole Time Director will cease to be Director on cessation of his employment with the Company
j) The appointment shall be governed by Section 196, 197, 203 read with Schedule V of the Companies Act, 2013 and rules made thereunder
Last drawn remuneration Rs. 60,29,414/- p.a.
Date of first appointment on the Board 23rd February 2010 No. of share held 250000 Equity Shares
Relationship with Directors, Managers & KMP Not Related
Number of Board Meeting attended during FY 2015
4
Other Directorship Nil
Chairman/ Member of the Committees of Boards of other companies
Shubham Housing Development Finance Company Limited
Member Assets Liability Management Committee Credit Committee Banking & Borrowing Committee
Permanent Invitee Recruitment, Compensation and Nomination Committee
Except, Mr. Sanjay Chaturvedi, No Directors, Key Managerial Personnel or their relatives are
interested or concerned in the resolution relating to appointment of Mr. Sanjay Chaturvedi. Item No. 7 Ms. Rupa Basu’s contribution towards the enhancement in the risk control measures of the Company is significant. It is in the interest of the Company to retain her services in the highly competitive employment market. The Recruitment, Compensation and Nomination Committee and Board of Directors are of the opinion that the compensation paid to the aforesaid person should be revised, more or less in line with the remuneration drawn by their counterparts in the country.
The remuneration proposed to be paid to Ms. Rupa Basu is commensurate with her experience and is in line with industry standards prevalent in India.
Ms. Rupa Basu is a Member of Institute of Chartered Accountants of India. She has the rich
experience in Finance industry.
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Since, she is wife of Mr. Ajay Oak, Director of the Company and this appointment is covered under Section 188(1) of the Companies Act, 2013, and therefore, approval of the shareholders by way of special resolution at their General Meeting is required. The Board recommends this special resolution. The monetary value of this transaction is embodied in the resolution and be construed accordingly.
The particulars of the transaction pursuant to para 3 of Explanation (1) to Rule 15 of Companies (Meeting of Board and its Powers) Rules, 2014 are as under:
Name of the related party Ms. Rupa Basu
Name of the director or Key Managerial personnel who is related
Mr. Ajay Oak
Nature of relationship Ms. Rupa Basu is wife of Mr. Ajay Oak
Remuneration As provided in the Resolution
Payment Schedule NA
Nature, material terms and particulars of the Arrangement
Ms. Rupa Basu has been appointed as an employee of the Company on remuneration and terms & conditions as embodied in the resolution given in item No. 7 and his remuneration is proposed to be revised annually as per terms set out in the said item No. 7.
Duration of the contract Ms. Rupa Basu has been appointed under a contract of employment pursuant to which he may function according to directions as may be given by the Company from time to time. Contract will continue as long as he remains an employee as per the contract of employment
Except Mr. Ajay Oak being his relatives, none of the Directors and Key Managerial Personnel of the Company and their relatives is concerned or interested, financial or otherwise, in the resolution.
Item No. 8, 9 & 10 As per section 149(5) of the Companies Act 2013, read with Schedule IV of the Companies Act 2013 and Rules made there under the Independent Directors are not liable to retirement by rotation. Since the provisions of the Act have recently become applicable to the Company, the Company proposes to vary the terms of appointment of Mr. Vinod Rai, Mr. Rakesh Rewari and Ms. Ranjana Agarwal as Non-Executive Independent Directors w.e.f. 06.11.2015, 06.11.2015 and 20.01.2015 respectively. The Board also recommends to fix the tenure of 5 (five) consecutive years with effect from 27 July 2016 in accordance with the aforesaid provisions. The fixation of the tenure of the Independent Director is appropriate and in the best interest of the Company. A copy of the Letter of appointment of Independent Director, setting out terms and condition of their appointment, is available for inspection.
None of the Director, Key Managerial Persons and their relatives are deemed to be interested or concerned in the proposed resolution except Mr. Vinod Rai, Mr. Rakesh Rewari and Ms. Ranjana Agarwal, respectively.
Item No. 11
Pursuant to the existing Clause 56.9 of the Articles of Association of the Company, any appointment, engagement, removal, termination or increase in compensation of directors, chief executive officer,
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chief operating officer and other employees whose remuneration is in excess of INR 25,00,000/- (Twenty Five lacs) per annum is considered to be a reserved matter and requires specific approval of the shareholders. Keeping in view the growth of the Company and present size of the organization, it is proposed to raise the limit of INR 25,00,000/- to INR 50,00,000/- and therefore, the alteration in Articles is proposed accordingly.
The Board recommends the resolution set forth in Item 11 above for approval of the members by way of Special Resolution. None of the Directors / Key Managerial Personnel of the Company / their relatives are, in any way, concerned or interested, financially or otherwise, in the Special Resolution set out at Item No. 11 of the notice.
By Order of the Board
For Shubham Housing Development Finance Company Limited
Sd/- (Neeta Kamra)
Company Secretary Membership No. : ACS 22892
Add: Shubham House, 425, Udyog Vihar, Phase IV, Gurgaon-1220015
Place: Gurgaon Date: 27.07.2016
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
DIRECTORS’ REPORT The Members,
Shubham Housing Development Finance Company Limited D-305, Ground Floor, Sarvodaya Enclave,
New Delhi - 110017
Your Directors have pleasure in presenting Annual Report and Audited Statement of Accounts of the Company for the year ended on 31st March 2016.
1. FINANCIAL RESULT: (Figures in Rs. Crores)
Particulars Current Year Previous Year
Revenue from Operations 102.12 51.99
Other Income 4.63 4.85
Total Income 106.75 56.84
Profit before Depreciation 7.59 1.77
Less: Depreciation 0.80 0.73 Profit after depreciation 6.79 1.04
Provision for Tax including Deferred Tax 1.05 0.42
MAT credit entitlement 0.15 -0.42
Total Tax Expense 1.20 -
Profit after Tax 5.59 1.04
2. STATE OF COMPANY’S AFFAIRS: During the year under review, the Company has earned an income from operations of Rs. 102.12 crores as against Rs. 51.99 crores during the previous year. The Company has earned a net profit after taxes amounting of Rs. 5.59 crores during the year (Rs. 1.04 crores during the previous year).
3. MATERIAL CHANGES AND COMMITMENTS: No material change / commitment has occurred between the ends of financial year to which the financial statements relate till the date of this report, which have any adverse effect on the financial position of the Company.
4. TRANSFER TO RESERVES:
The Company has transferred an amount of Rs. 1.11 crores to special reserve in accordance with the NHB regulations in this regard, thereby reducing the tax impact.
5. DIVIDEND:
No dividend has been recommended by the Board of Directors for the year.
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6. DEPOSITS:
The Company has not accepted any deposit(s) under section 73 of the Companies Act, 2013 and Companies (Acceptance of Deposits) Rules, 2013.
7. DIRECTORS:
Mr. Sanjay Chaturvedi and Mr. Ajay Mukund Oak are the founder directors of the Company. The Company’s Board also has Mr. Sandeep Marian Farias, Mr. Ashit Ranjit Lilani, Mr. Rahul Chandra and Mr. Vishal Kumar Gupta as Nominee Directors for foreign investors on the Board of the Company. Ms. Ranjana Agarwal is an Independent Director on the Board of the Company.
Ms. Monica Brand Engel resigned from the directorship of the Company on July 31, 2015 and on the same day Mr. Ganesh Rengaswamy was appointed as Nominee Director on the Board of the Company.
Mr. Ganesh Rengaswamy resigned from the directorship on November 6, 2015.
Mr. Vinod Rai and Mr. Rakesh Rewari were appointed as Independent Directors on 6 th
November, 2015.
Ms. Neeta Kamra is the Company Secretary of the Company since 3rd September, 2012.
8. RE-APPOINTMENT:
As per the provisions of section 152(6) of the Companies Act, 2013, Mr. Sandeep Marian Farias and Mr. Rahul Chandra retire at the ensuring Annual General Meeting and being eligible, seek re-appointment. The Board recommends their re-appointment.
9. ANNUAL DECLARATION FROM INDEPENDENT DIRECTORS:
The Company has received necessary declaration from Independent Directors of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Director of the Company meet with the criteria of their independence as laid down in Section 149(6).
10. MEETING OF THE BOARD OF DIRECTORS:
Details of the Board Meetings held during the year are as follow:
S. No. Date of the Meetings Total No. of Directors as on Meeting
No. of Director Attended
1 28.04.2015 8 8
2 31.07.2015 8 6
3 06.11.2015 8 8 4 19.02.2016 9 9
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Details of Directors as on March 31, 2016 and their attendance at the Board during the financial year ended March 31, 2016 are given below:
Name of Director No. of Board Meetings held during the tenure of the director
No. of Board Meeting attended
Sanjay Chaturvedi 4 4
Ajay Oak 4 4
Sandeep Marian Farias 4 4
Ashit Ranjit Lilani 4 4 Rahul Chandra 4 3
Vishal Kumar Gupta 4 4
Vinod Rai *1 1 1
Rakesh Rewari *2 1 1
Ranjana Agarwal 4 4
Monica Brand Engel *3 2 1 Ganesh Rengaswamy *4 1 1
*1 Mr. Vinod Rai was appointed as Additional Director (Independent) on Nov. 6, 2015. *2 Mr. Rakesh Rewari was appointed as Additional Director (Independent) on Nov. 6, 2015. *3 Ms. Monica Brand resigned from the Directorship of the Company on July 31, 2015. *4 Mr. Ganesh Rengaswamy was appointed as Director on the Board on July 31, 2015 and resigned from the directorship on November 6, 2015.
11. COMMITTEES OF THE BOARD: Currently, the Board has the following seven committees:
1. Audit Committee,
2. Risk Management Committee,
3. Asset Liability Management Committee,
4. Recruitment Compensation and Nomination Committee,
5. Banking & Borrowing Committee,
6. Credit Committee and
7. Sexual Harassment Committee.
Audit Committee The role of the Audit Committee is in accordance with the provisions of Section 177 of the Act. The terms of reference for the Audit Committee include:
• Examination of Financial Statement and Statutory Auditors’ report thereon and discussion of any related issues with the Internal & Statutory Auditors and the management of the Company.
• Review of Financial Statement before their submission to the Board, including changes
in accounting policies and practices, statutory compliances and qualification in draft
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• Approval or any subsequent modification of transactions of the Company with related
parties.
• Evaluation of internal financial controls.
• Evaluation of risk management system.
• Monitoring end use of funds raised through public offers and related matters.
• Review of Company’s financial reporting processes and the disclosure of financial information to ensure that the Financial Statement is correct, sufficient and credible.
• Look into reasons for substantial defaults in payments to stakeholders.
• Approval of appointment of CFO or any other person heading Finance function after assessing the qualifications, experience, background etc. of the candidate.
• Recommendation for appointment, remuneration and terms of appointment of the
Statutory Auditors of the Company.
• Review and monitor the Auditor’s independence and performance, effectiveness of audit process and adequacy of internal control systems.
• Call for comments of the Statutory Auditors about internal control systems, the scope
of audit, including the observations of the Statutory Auditors.
• Reviewing the adequacy of the Internal Audit function including the structure of the Internal Audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of Internal Audit.
• Discussion with statutory auditors before the audit commences, about nature and scope of audit as well as post audit discussion to ascertain any area of concern.
• Reviewing findings of any internal investigation into matters where there is suspected fraud or irregularity or failure of internal control systems of a material nature and reporting the matter to the Board.
• Establish a vigil mechanism for directors and employees to report genuine concerns in such manner as may be prescribed
During the period under review, the Audit Committee met 4 times on 28/04/2015,
31/07/2015, 06/11/2015 and 19/02/2016.
Constitution of the Audit Committee and attendance details during the financial year ended March 31, 2016 are given below:
Name of the Director No. of Meetings held
No. of Meetings attended
Mr. Sanjay Chauturvedi *1 4 4
Mr. Rahul Chandra *2 4 3
Mr. Vishal Kumar Gupta 4 4
Ms. Ranjana Agarwal *3 0 0 Mr. Rakesh Rewari*4 0 0
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*1 Mr. Sanjay Chaturvedi ceased to be the member of the Audit
Committee w.e.f 19/02/2016.
*2
Mr. Rahul Chandra ceased to be the member of the Audit Committee w.e.f 19/02/2016. *3
Ms. Ranjana Agarwal was appointed as member of the Audit Committee w.e.f 19/02/2016.
*4
Mr. Rakesh Rewari was appointed as member of the Audit Committee w.e.f 19/02/2016.
Risk Management Committee
The terms of reference for the Risk Management Committee include:
• The purpose of the committee is to assist the Board in fulfillment of its Corporate
Governance with regards to the identification, evaluation and mitigation of various risks efficiently and effectively.
During the period under review, the Risk Management Committee met 2 times on 06/11/2015 and 19/02/2016.
Constitution of the Risk Management Committee and attendance details during the financial
year ended March 31, 2016 are given below:
Name of the Director/Member No. of Meetings No. of Meetings attended
Mr. Ajay Oak 2 2
Mr. Ashit Ranjit Lilani *1 1 1
Mr. Sandeep Marian Farias 2 2
Mr. Vinod Rai *2 0 0
Mr. Sanjay Chaturvedi *3 0 0
*1
Mr. Ashit Ranjit Lilani ceased to be a member of the Committee w.e.f 6th
November, 2015
*2 Mr. Vinod Rai appointed as member of the Committee on 19/02/2016.
*3 Mr. Sanjay Chaturvedi appointed as member of the Committee on 19/02/2016.
Recruitment, Compensation and Nomination Committee
The terms of reference for the Recruitment, Compensation and Nomination Committee
include: • To review and approve goals and objectives relevant to the compensation of the Chief
Executive Officer/ Chief Operations Officer.
• To evaluate the performance of the Chief Executive Officer/ Chief Operations Officer.
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• To recommend the compensation of the Chief Executive Officer/Chief Operation
Officer. • To recommend the compensation of employees having compensation above than the
threshold prescribed in Article of Association of the Company.
During the period under review, the Recruitment, Compensation and Nomination Committee met 2 times on 28/04/2015 and 06/11/2015.
Constitution of the Recruitment, Compensation and Nomination Committee and attendance details during the financial year ended March 31, 2016 are given below:
Name of the Director/Member No. of Meetings No. of Meetings attended
Mr. Sandeep Marian Farias 2 1 Mr. Ashit Ranjit Lilani 2 2
Mr. Sanjay Chaturvedi 2 2
Mr. Ajay Oak 2 2
Assets Liability Management Committee
The terms of reference for the Assets Liability Management Committee include:
• To assess of various types of risks and altering the asset-liability portfolio in a dynamic
way in order to manage risks.
During the period under review, the Assets Liability Management Committee met 4 times on
28/04/2015, 15/07/2015, 06/11/2015 and 19/02/2016.
Constitution of the Assets Liability Management Committee and attendance details during the financial year ended March 31, 2016 are given below:
Name of the Director/Member No. of Meetings No. of Meetings attended
Mr. Sanjay Chaturvedi 4 4
Mr. Monica Brand Engel *1 2 1
Mr. Rahul Chandra *2 4 4
Mr. Ganesh Rengaswamy *3 2 2
Mr. Rakesh Rewari *4 0 0
Mr. Ajay Oak *4 0 0
*1 Ms. Monica Brand resigned from the directorship of the Company w.e.f 31 st July,
2015. *2
Mr. Rahul Chandra ceased to be the member of the Committee w.e.f 19th
February, 2016.
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 *3
Mr. Ganesh was appointed as director and member of the Committee w.e.f 31st
July, 2015. *4
Mr. Rakesh and Mr. Ajay were appointed as member of the Committee w.e.f 19th
February, 2016. Banking & Borrowing Committee
The terms of reference for the Banking & Borrowing Committee include:
• To provided operational assistance to the Company at the time of taking loans or
borrowings of any nature from bank/institution within the overall limits set by the board of directors and to do other banking operation activities.
During the period under review, the Banking & Borrowing Committee met 15 times on 01/05/2015, 02/06/2015, 17/06/2015, 30/06/2015, 31/07/2015, 21/08/2015, 26/08/2015, 16/09/2015, 28/10/2015, 16/11/2015, 25/01/2016, 23/02/2016, 22/03/2016, 28/03/2016 and 31/03/2016.
Constitution of the Banking & Borrowing Committee and attendance details during the
financial year ended March 31, 2016 are given below:
Name of the Director/Member No. of Meetings held during the tenure
No. of Meetings attended
Mr. Sanjay Chaturvedi 15 15
Mr. Rahul Chandra 15 12
Mr. Vishal Kumar Gupta *1 9 4
Mr. Ajay Oak *2 4 4 *1
Mr. Vishal Kumar Gupta has ceased to be the member of the Committee w.e.f 6th
November, 2015. *2 Mr. Ajay Oak was appointed as member of the Committee w.e.f 19 th February,
2016.
Credit Committee The terms of reference for the Credit Committee include: • To provide establishment of policies and guidelines.
• To oversee management’s administration of the Company’s credit portfolio,
including management’s responses to trends in credit risk, credit concentration and
asset quality.
During the period under review, the Credit Committee met 4 times on 28/04/2015, 31/07/2015, 28/09/2015 and 19/02/2016.
Constitution of the Credit Committee and attendance details during the financial year ended March 31, 2016 are given below:
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Name of the Director/Member No. of Meetings held during the tenure
No. of Meetings attended
Mr. Ajay Oak 4 4
Mr. Sandeep Marian Farias 4 4
Ms. Monica Brand Engel *1 2 1 Mr. Ganesh Rengaswamy *2 2 1
Mr. Sanjay Chaturvedi *3 0 0
*1
Ms. Monica Brand has resigned from the directorship of the Company w.e.f 31st
July, 2015. *2
Mr. Ganesh has been appointed as director and member of the Committee w.e.f
31st July, 2015. *3 Mr. Sanjay Chaturvedi was appointed as member of the committee w.e.f 19th
February, 2016
Sexual Harassment Committee The Company has in place an Anti-Sexual Harassment policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Sexual Harassment Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.
The following is the summary of sexual harassment complaints received and disposed off
during each calendar year.
• No. of Complaints received: 1
• No. of Complaints disposed off: 1
During the period under review, the Sexual Harassment Committee met 2 time on 29th July,
2015 and 31st March 2016.
Constitution of the Sexual Harassment Committee and attendance details during the
financial year ended March 31, 2016 are given below:
Name of the Members No. of Meetings No. of Meetings attended
Mr. Sanjay Chaturvedi 2 2
Mr. Ajay Oak 2 2
Ms. Manjari Jhingran 2 1
Ms. Neeta Kamra 2 2
Ms. Neetu Gujral 2 2
Ms. Latika Thukral*1 2 2
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 *1 Ms. Latika Thukral is an Independent NGO Member of the Committee.
12. DIRECTOR’S RESPONSIBILITY STATEMENT:
In compliance to the provisions of Section 134 (3)(c) of the Companies Act, 2013, your
Directors wish to place on record - (a) in the preparation of the annual accounts, the applicable accounting standards were followed along with proper explanation relating to material departures;
(b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;
(c) the Directors took proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors have prepared the annual accounts on a going concern basis;
(e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
(f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
13. AUDITORS: Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, M/s. B S R & Associates LLP, Chartered Accountants, the Statutory Auditors of the Company have been appointed for a term of 5 years. However, their appointment as Statutory Auditors of the Company shall be required to be ratified by the Members at the ensuing Annual General Meeting. The Company has received a confirmation from the said Auditors that they are not disqualified to act as the Auditors and are eligible to hold the office as Auditors of the Company.
Necessary resolution for ratification of appointment of the said Auditors is included in the
Notice of AGM for seeking approval of members.
14. SECRETARIAL AUDITORS:
The Board of Directors appointed Naveen Narang & Associates, Practicing Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company for Financial Year 2016-17 and their report is annexed to this Board report.
15. AUDITOR’S QUALIFICATION/RESERVATION /ADVERSE REMARK: There is no adverse qualification/ reservation/ remark in the Auditor’s Report. However for other notes Directors would like to state that notes are self-explanatory and there is no need to give any further explanation/ comments.
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
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16. SECTERIAL AUDITOR’S QUALIFICATION/RESERVATION /ADVERSE REMARK: There is no adverse qualification/ reservation/ remark in the Secretarial Auditor’s Report.
17. LOAN / GUARANTEE / INVESTMENTS:
The Company is a housing finance company registered with the National Housing Board and
therefore, the provisions of section 186 except section 186(1) are not applicable on it. 18. CONTRACTS / ARRANGEMENT WITH RELATED PARTIES:
The details of Contract and Arrangement under Section 188 of the Companies Act, 2013 in
prescribed Form AOC 2 have been annexed herewith and forms part of this report.
19. PARTICULARS OF REMUNERATION OF EMPLOYEES:
Disclosures pertaining to remuneration and other details under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not required to be given since none of the employee of the Company is in receipt of remuneration exceeding the limits prescribed therein.
20. ESOP
Disclosure required under Rule 12 of Companies (Share Capital and Debentures) Rules, 2014
is as follow:
Particulars Employee Stock Option Plan
Options Granted during the year 29,529
Options Vested during the year 0
Options Exercised during the year 0
Total number of shares arising out of exercise of options
0
Options lapsed during the year 0
Exercised Price 10
Variation of Terms of Options Nil
Money realized by exercise of options Nil
Total number of option in force 29,529 Employees wise Details of Options Granted
Key Managerial Person:
Any other employee receiving grant in any one year of option amounting to five percent or more of options granted during that year:
NIL
Employees who were granted option, during any one year, equal to or exceeding one percent of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant.
NIL
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
21. CONSERVATION OF ENERGY, TECHNOLOGY & FOREIGN EXCHAANGE EARNING & OUTGO:
Information in accordance with the provision of Section 134 (3) (m) of the Companies Act, 2013, read with Rule 8 of Companies (Account) Rules 2014 regarding conservation of energy technology absorption and foreign exchange earnings and outgo is as under:
a. Conservation of Energy
Your Company is engaged in trading activity. As the Company has not undertaken manufacturing activity, the disclosure under the applicable rules is not required to be provided. However, your Company has generally taken all reasonable efforts to conserve energy.
b. Technology Absorption
The Company has not imported any technology and hence, the requirement of technology absorption is not applicable.
c. Foreign Exchange Earnings and Outgo
The Foreign Exchange earnings and outgo of the company is as follows:
(a) Foreign Exchange Earnings: Rs Nil (b) Foreign Exchange Outgo: Rs. Nil
22. COMPANY’S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF
REMUNERATION AND DISCHARGE OF THEIR DUTIES:
The current policy is to have an appropriate mix of executive and non-executive and Independent Directors to maintain the independence of the Board, and separate its functions of governance and management. As on March 31, 2016, the Board consists of nine members, two of whom are executive and four are non-executive nominee directors and three are Independent Directors.
The Policy of the Company on directors’ appointment and remuneration, independence of a director and other matters, as required under sub-section (3) of the Section 178 of the Companies Act, 2013, is available on our website (http://:shubham.co). We affirm that the remuneration paid to the directors is as per the terms laid out in the Recruitment Compensation and Nomination Committee’s policy of the Company.
23. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES:
The Company does not have any Subsidiary, Joint Venture or Associate Companies.
24. RISK MANAGEMENT:
The Company has constituted a Risk Management Committee to identify and minimize the internal and external risks associated with the business of the Company.
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25. VIGIL MECHANISM:
The Company has constituted a Vigil Mechanism for employees and directors to report
concerns about unethical behavior, actual or suspected fraud or violation of the
Company’s Code of Conduct and ethics. The purpose of the mechanism to promote the highest ethical standards, the Company will maintain a workplace that facilities the reporting of potential violations of Company policies and applicable laws.
26. CORPORATE SOCIAL RESPONSIBILITY:
The provisions relating to Corporate Social Responsibility are not applicable on the Company and therefore no policy in this regard has been developed / implemented by the Company during the financial year.
27. INTERNAL FINANCIAL CONTROL: The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.
28. EXTRACT OF ANNUAL RETURN:
The extract of Annual return in prescribed Form MGT 9 has been annexed herewith and
forms part of this report.
29. APPRECIATION:
Your Directors wish to place on record their deep sense of appreciation of the devoted
services rendered by the executives of the company and bank etc.
For and on behalf of the Board of
Shubham Housing Development Finance Company Limited
Sanjay Chaturvedi Ajay Mukund Oak Director Director DIN: 01636432 DIN: 01779000 D-305, Ground Floor, S-10A, Windsor Court, DLF Phase IV Sarvodaya Enclave, Gurgaon, Haryana New Delhi
Place: Gurgaon Date: 27.07.2016
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ANNEXURE I TO DIRECTORS’ REPORT SECRETARIAL AUDIT REPORT
For the financial year ended 31st March, 2016
To,
The Members, Shubham Housing Development Finance Company Limited
D-305, Ground Floor, Sarvodaya Enclave, New Delhi 110017 We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Shubham Housing Development Finance Company Limited (hereinafter called the Company). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.
Based on our verification of the Company’s books, papers, minute books, forms and returns filed and other records maintained by the company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, We hereby report that in our opinion, the company has, during the audit period covering the financial year ended on 31st March, 2016 complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:
We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31st March 2016 according to the provisions of:
(i) The Companies Act, 2013 (the Act) and the rules made there under;
(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made there under;
(iii) The Depositories Act, 1996 and the Regulations and Bye Laws framed thereunder;
(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made there under to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings; and
(v) National Housing Bank Act, 1987
We have also examined compliance with the applicable clauses of the following:
(i) Secretarial Standards issued by The Institute of Company Secretaries of India.
During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. as mentioned above.
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 We further report that
The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act. Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.
Majority decision is carried through while the dissenting members’ views are captured and recorded
as part of the minutes.
We further report that there are adequate systems and processes in the company commensurate with the size and operations of the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.
We further report that during the audit period the Company has:
(a) Issued 200 Non Convertible Debentures of Rs. 10,00,000.00 (Rupees Ten Lac) each aggreagting to Rs. 200,00,00,000.00 (Rupees Two Hundred Crores) in the meeting of Board
of Directors of the Company held on 28th day of March 2016;
(b) Passed special resolution under section 14 of the Companies Act, in the Extra Ordinary General Meeting held on March 28, 2016, for alteration of its Articles having the effect of conversion of private company into public company and consequently for change in name of the Company to Shubham Housing development Finance Company Limited. Therefore, pursuant to aforesaid provisions of the Companies Act 2013, the status of the Company was changed to Public Limited effective from 28th March 2016.
For Naveen Narang & Associates Company Secretaries
(Naveen Narang) Partner
Membership No. 6193, C.P. No. 6621 Place: Delhi
Date: 06.06.2016
(This report is to be read with our letter of even date, which is annexed as Annexure A and forms an integral part of this report.)
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‘Annexure A’
To, The Members,
Shubham Housing Development Finance Company Private Limited D-305, Ground Floor, Sarvodaya Enclave,
New Delhi 110017 Our report of even date is to be read along with this letter.
1. Maintenance of secretarial record is the responsibility of the management of the company.
Our responsibility is to express an opinion on these secretarial records based on our audit. 2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we followed provide a reasonable basis of our opinion.
3. We have not verified the correctness and appropriateness of financial records and Books of
accounts of the Company.
4. Wherever required, we have obtained the Management representation about the
compliance of laws, rules and regulations and happening of events etc.
5. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of management. Our examination was limited to the verification of procedures on test basis.
6. The Secretarial Audit report is neither an assurance as to the future viability of the company nor of the efficacy or effectiveness with which the management has conducted the affairs of the company.
For Naveen Narang & Associates
Company Secretaries
(Naveen Narang) Partner
Membership No. 6193, C.P. No. 6621 Place: Delhi
Date: 06.06.2016
Page 29 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
ANNEXURE II TO DIRECTORS’ REPORT FORM NO. AOC -2
(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies
(Accounts) Rules, 2014.
Form for Disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub section (1) of section 188 of the Companies Act, 2013 including certain arms length transaction under third proviso thereto.
1. Details of contracts or arrangements or transactions not at Arm’s length basis.
Sl. No. Particulars Details
a) Name (s) of the related party & nature of relationship NIL
b) Nature of contracts/arrangements/transaction NIL
c) Duration of the contracts/arrangements/transaction NIL
d) Salient terms of the contracts or arrangements or
transaction including the value, if any
NIL
e) Justification for entering into such contracts or
arrangements or transactions’
NIL
f) Date of approval by the Board
g) Amount paid as advances, if any NIL
h) Date on which the special resolution was passed in
General meeting as required under first proviso to
section 188
NIL
2. Details of contracts or arrangements or transactions at Arm’s length basis.
Sl. No. Particulars Details
a) Name (s) of the related party & nature of relationship Ms. Rupa Basu & Director’s
Wife
b) Nature of contracts/arrangements/transaction Employment Contract
c) Duration of the contracts/arrangements/transaction Continuing
d) Salient terms of the contracts or arrangements or Appointed as Chief Risk
Page 30 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
transaction including the value, if any Officer at an anuual salary
of Rs. 73,50,000/- plus
perquisites as per the policy
of the Company
e) Date of approval by the Board 06.11.2015
f) Amount paid as advances, if any NIL
For and on behalf of the Board of Shubham Housing Development Finance Company Limited
Sanjay Chaturvedi Ajay Mukund Oak Director Director DIN: 01636432 DIN: 01779000 D-305, Ground Floor, S-10A, Windsor Court, DLF Phase IV Sarvodaya Enclave, Gurgaon, Haryana New Delhi
Place: Gurgaon
Date: 08.08.2016
Page 31 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
ANNEXURE III TO DIRECTORS’ REPORT Form No. MGT-9
EXTRACT OF ANNUAL RETURNAS ON THE FINANCIA L YEAR ENDED ON 31. 03.2016
[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014]
I. REGISTRATION AND OTHER DETAILS:
i. CIN U65921DL2010PLC199469
ii. Registration Date 23/02/2010
iii. Name of the Company Shubham Housing Development Finance
Company Limited
iv. Category / Sub-Category of the Company Public
v. Address of the Registered office and contact
details
D-305 Ground Floor, Sarvodaya Enclave,
New Delhi-110017
vi. Whether listed company No
vii. Name, Address and Contact details of Registrar
and Transfer Agent, if any
Skyline Financial Services Pvt. Ltd. D-153A,
1st Floor, Okhla Industrial Area, Phase-I, New
Delhi-110020
II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
All the business activities contributing 10 % or more of the total turnover of the company shall be
stated:-
Sr.
No.
Name and Description of main
products / services
NIC Code of
the Product/
service
% to total turnover of the
company
1 Housing and Non- Housing Loan 64920 91.46%
Page 32 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES
Sr.
No.
Name And Address Of
The Company
CIN/GLN Holding/
Subsidiary
/Associate
% of
shares
held
Applicable
Section
1. NA NA NA NA NA
IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)
i. Category-wise Share Holding
Category of
Shareholders
No. of Shares held at the
beginning of the year
No. of Shares held at the end of
the year
%
Change
during
the
year
Demat Physical Total % of
Total
Shares
Demat Physical Total % of
Total
Shares
A. Promoter
1) Indian
a) Individual/
HUF - 500000 500000 52.98
%
- 500000 500000 52.98
% -
b) Central Govt - - - - - - - - -
c) State Govt(s) - - - - - - - - -
d) Bodies Corp - - - - - - - - -
e) Banks / FI - - - - - - - - -
f) Any Other - - - - - - - - -
Sub-total(A)(1):-
- 500000 500000 52.98
%
- 500000 500000 52.98
%
-
2) Foreign
g) NRIs-
Individuals
- - - - - - - - -
h) Other-
Individuals
- - - - - - - - -
i) Bodies Corp. - - - - - - - - -
j) Banks / FI - - - - - - - - -
k) Any Other…. - - - - - - - - -
Sub-total (A)(2):-
- - - - - - - - -
B. Public
Shareholding
1. Institutions
a)Mutual Funds - - - - - - - - -
b) Banks / FI - - - - - - - - -
Page 33 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
c) Central Govt - - - - - - - - -
d) State Govt(s) - - - - - - - - -
e) Venture Capital
Funds
- - - - - - - - -
f) Insurance
Companies
- - - - - - - - -
g) FIIs - - - - - - - - -
h) Foreign
Venture
Capital Funds
- - - - - - - - -
i) Others (specify) - - - - - - - - -
Sub-total (B)(1)
- - - - - - - - -
2. Non
Institutions
a) Bodies Corp.
(i) Indian
(ii) Overseas
21377
38895
19
264348
21396
303243
2.27
32.13
21377
38895
19
264348
21396
303243
2.27
32.13
-
-
b) Individuals
(i) Individual
shareholders
holding nominal
share capital upto
Rs. 1 lakh
(ii) Individual
shareholders
holding nominal
share capital in
excess of Rs 1
lakh
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
c) Others(Shubha
m’s Trust)
0 119051 119051 12.62 0 119051 119051 12.62 -
Sub-total (B)(2) 60272 383418 443690 47.02 60272 383418 443690 47.02 -
Total Public
Shareholding
(B)=(B)(1)+
(B)(2)
60272
383418
443690
47.02
60272
383418
443690
47.02
-
C. Shares held by
Custodian for
GDRs & ADRs
- - - - - - - - -
Grand Total
(A+B+C)
60272 883418 943690 100 60272 883418 943690 100 -
Page 34 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 ii.Shareholding of Promoters
Sr.
No
Shareholder’s
Name
Shareholding at the beginning of
the year
Shareholding at the end of the
year
No. of
Shares
% of total
Shares of
the
company
%of Shares
Pledged /
encumbered
to total
shares
No. of
Shares
% of total
Shares of
the
company
%of Shares
Pledged /
encumbered
to total
shares
% change in
shareholding
during the
year
1. Sanjay
Chaturvedi
250000 26.49% - 250000 26.49% - -
2. Ajay Oak 250000 26.49% - 250000 26.49% - -
Total 500000 52.98% - 500000 52.98% - -
iii.Change in Promoters’ Shareholding ( please specify, if there is no change)
There has been no change in the Promoters’ Shareholding during the year.
Sr.
no
Shareholding at the beginning
of the year
Cumulative Shareholding
during the year
No. of shares % of total
shares of the
company
No. of shares % of total
shares of the
company
At the beginning of the year 500000 52.98% 500000 52.98%
Date wise Increase / Decrease
in Promoters Shareholding
during the year specifying the
reasons for increase
/ decrease (e.g. allotment /
transfer / bonus/ sweat equity
etc):
- - - -
At the End of the year 500000 52.98% 500000 52.98%
iv.Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of
GDRs and ADRs):
The list of top 10 equity shareholders of the company is as follows. There has been no change in their
shareholding during the year.
Sl. No. Name of Shareholder No. of Shares held % Shareholding
1 Shubham Employees Welfare 119407 12.65%
Page 35 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 Trust
2 Helion Venture Partners II
LLC
93763 9.94%
3 Elever Equity Mauritius 93763 9.94%
4 IBEF- IIA 38899 4.12%
5 ACCION Africa Asian
Investment Company
38409 4.07%
6 Saama Capital II Ltd. 38409 4.07%
7 Motilal Oswal Securities
Limited
21381 2.27%
8 MOPE Investment Advisors 15 0.00%
9 Shubhmo Employee Trust 4 0.00%
v. Shareholding of Directors and Key Managerial Personnel:
Sl.
no
Shareholding at the beginning
of the year
Cumulative Shareholding
during the year
Sanjay Chaturvedi No. of shares % of total
shares of the
company
No. of shares % of total
shares of the
company
At the beginning of the year 250000 26.49% 250000 26.49%
Date wise Increase / Decrease
in Shareholding during the
year specifying the reasons for
increase
/ decrease (e.g. allotment /
transfer / bonus/ sweat equity
etc):
- - - -
At the End of the year 250000 26.49% 250000 26.49%
Sl.
no
Shareholding at the beginning
of the year
Cumulative Shareholding
during the year
Ajay Oak No. of shares % of total
shares of the
company
No. of shares % of total
shares of the
company
At the beginning of the year 250000 26.49% 250000 26.49%
Date wise Increase / Decrease
in Shareholding during the year
specifying the reasons for
increase
/ decrease (e.g. allotment /
transfer / bonus/ sweat equity
etc):
- - - -
At the End of the year 250000 26.49% 250000 26.49%
Page 36 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
V. INDEBTEDNESS
Indebtedness of the Company including interest outstanding/accrued but not due for payment
Secured Loans
excluding
deposits
Unsecured
Loans
Deposits Total
Indebtedness
Indebtedness at the beginning
of the financial year
i) Principal Amount
ii) Interest due but not paid
iii) Interest accrued but not
29,62,249,287/-
-
-
-
-
-
-
-
-
29,62,249,287/-
-
-
Total (i+ii+iii) 29,62,249,287/- - - 29,62,249,287/-
Change in Indebtedness
during the financial year
- Addition
- Reduction
14,32,346,970/-
-
30,00,00,000/-
-
-
-
17,32,346,970/-
Net Change 14,32,346,970/- 30,00,00,000/- - 17,32,346,970/-
Indebtedness at the
end of the financial year
i) Principal Amount
ii) Interest due but not paid
iii) Interest accrued but not
due
43,94,596,257/-
-
-
30,00,00,000/-
-
-
-
-
-
46,94,596,257/-
-
-
Total (i+ii+iii) 43,94,596,257/- 30,00,00,000/- - 46,94,596,257/-
Page 37 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
A. Remuneration to Managing Director, Whole-time Directors and/or Manager
Sl. No. Particulars of Remuneration Name of MD/WTD/
Manager
Total
Amount
1.
Gross salary
(a) Salary as per provisions contained in
section 17(1) of the Income-tax Act,
1961
(b) Value of perquisites u/s
17(2) Income-tax Act,
1961
(c) Profits in lieu of salary under section
17(3) Income- tax Act, 1961
Sanjay Chaturvedi
Rs. 60,29,414
-
-
Ajay Oak
Rs. 60,58,154
-
-
Rs.120,87,568
-
-
2. Stock Option - - -
3. Sweat Equity - - -
4. Commission
- as % of profit
- others, specify…
- - -
5. Others, please specify - - -
6. Total (A) 60,29,414 60,58,154 120,87,568
Ceiling as per the Act The Company being a private limited company till
28th March 2016, the ceiling under section 197 was
not applicable on it.
Page 38 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 B. Remuneration to other directors:
Sl. No. Particulars of Remuneration Name of MD/WTD/ Manager
Total
Amount
Independent Directors
· Fee for attending board
committee meetings
· Commission
· Others, please specify
Ranjana
Agarwal
2,00,000
Vinod Rai
50,000
Rakesh Rewari
50,000
3,00,000
Total (1)
Other Non-Executive Directors
· Fee for attending board
committee meetings
· Commission
· Others, please specify
- - - -
Total (2) - - - -
Total (B)=(1+2) 2,00,000 50,000 50,000 3,00,000
Total Managerial Remuneration 123,87,568
Overall Ceiling as per the Act The Company being a private limited company till 28th March
2016, the ceiling under section 197 was not applicable on it.
C. Remuneration to Key Managerial Personnel Other Than MD /Manager /WTD
Sl.
no.
Particulars of
Remuneration
Key Managerial Personnel
CEO Company
Secretary
CFO Total
1.
Gross salary
(a) Salary as per
provisions contained in
section 17(1) of the
Income-tax Act, 1961
(b) Value of
perquisites u/s
17(2) Income-tax
Act, 1961
(c) Profits in lieu of salary
under section
Neeta Kamra
11,30,630
-
-
11,30,630
Page 39 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
17(3) Income-tax
Act, 1961
2. Stock Option -
3. Sweat Equity -
4. Commission
- as % of profit
- others, specify…
-
5. Others, please specify -
6. Total 11,30,630 11,30,630
VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:
Type Section of
the
companies
Act
Brief
description
Details of
Penalty/
Punishment/
Compounding
fees imposed
Authority[RD
/NCLT/Court]
Appeal
made. If
any(give
details)
A. Company
Penalty - - - - -
Punishment - - - - -
Compounding - - - - -
B. Directors
Penalty - - - - -
Punishment - - - - -
Compounding - - - - -
C. Other Officers In Default
Penalty - - - - -
Punishment - - - - -
Compounding - - - - -
For and on behalf of the Board of
Shubham Housing Development Finance Company Limited
Sanjay Chaturvedi Ajay Mukund Oak
Director Director
DIN: 01636432 DIN: 01779000
D-305, Ground Floor, S-10A, Windsor Court, DLF Phase IV
Sarvodaya Enclave, Gurgaon, Haryana
New Delhi
Place: Gurgaon
Date: 27/07/2016
Page 40 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Independent Auditor’s Report
To the Members of Shubham Housing Development Finance Company Limited (formerly known as
Shubham Housing Development Finance Company Private Limited) Report on the Financial Statements
We have audited the accompanying financial statements of Shubham Housing Development Finance
Company Limited (formerly known as Shubham Housing Development Finance Company Private
Limited) (‘the Company’), which comprise the Balance Sheet as at 31 March 2016, the Statement of
Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information (collectively referred to as ‘financial
statements’).
Management’s Responsibility for the Financial Statements
The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the
Companies Act, 2013 (“the Act”) with respect to the preparation of these financial statements that
give a true and fair view of the financial position, financial performance and cash flows of the Company
in accordance with the accounting principles generally accepted in India, including the Accounting
Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules,
2014. This responsibility also includes maintenance of adequate accounting records in accordance
with the provisions of the Act for safeguarding the assets of the Company and for preventing and
detecting frauds and other irregularities; selection and application of appropriate accounting policies;
making judgments and estimates that are reasonable and prudent; and design, implementation and
maintenance of adequate internal financial controls, that were operating effectively for ensuring the
accuracy and completeness of the accounting records, relevant to the preparation and presentation
of the financial statements that give a true and fair view and are free from material misstatement,
whether due to fraud or error. Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the provisions of the Act and the
Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10)
of the Act. Those Standards require that we comply with ethical requirements and plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the
disclosures in the financial statements. The procedures selected depend on the auditor’s judgment,
including the assessment of the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor considers internal financial control
relevant to the
Page 41 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Company’s preparation of the financial statements that give a true and fair view in
order to design
audit procedures that are appropriate in the circumstances. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness of the accounting estimates
made by the Company’s Directors, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion on the financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the
aforesaid financial statements give the information required by the Act in the manner so required
and give a true and fair view in conformity with the accounting principles generally accepted in India,
of the state of affairs of the Company as at 31 March 2016, and its profit and its cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the
Central Government of India in terms of sub-section (11) of Section 143 of the Act, we enclose
in the ‘‘Annexure A’’ a statement on the matters specified in the paragraph 3 and 4 of the
said Order, to the extent applicable.
2 As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best
of our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the
Company so far as it appears from our examination of those books; (c) The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt
with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid financial statements comply with the Accounting
Standards specified under Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014;
(e) On the basis of the written representations received from the directors as at
31 March 2016 taken on record by the Board of Directors, none of the directors, is
disqualified as on 31 March 2016 from being appointed as a director in terms of Section
164 (2) of the Act; (f) With respect to the adequacy of the internal financial controls over financial reporting
of the Company and the operating effectiveness of such controls, refer to our separate
report in “Annexure B”; and
Page 42 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
(g) With respect to the other matters to be included in the Auditor’s Report in accordance
with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to
the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial
position in its financial position - Refer note 10 of the financial statements;
ii. The Company has made provision, as required under the applicable law or
accounting standards, for material foreseeable losses, if any, on long-term
contracts. The Company does not have any derivative contracts for which there
were any material foreseeable losses - Refer note 9 to the financial statements;
and
iii. There were no amounts which were required to be transferred to the Investor
Education and Protection Fund by the Company.
For B S R & Associates LLP
Chartered Accountants
Firm Registration No: 116231W /W-100024
Manish Gupta
Place: Gurgaon Partner
Date: 27 July 2016 Membership No.: 095037
Page 43 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 Annexure A to the Independent Auditor’s Report
(Referred to in our report of even date) i. (a) According to the information and explanations given to us, the Company has maintained
proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) According to the information and explanations given to us, the Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified annually. In our opinion, the periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its fixed assets. As explained to us, no material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and on the basis of our examination of books of accounts, no immovable properties are owned by the Company. Hence, the provisions of paragraph 3(i) (c) of the Order is not applicable.
ii. The Company is a housing finance company, engaged in the business of providing loans.
Accordingly, it does not hold any physical inventories. Thus, paragraph 3(ii) of the Order is not applicable.
iii. According to information and explanations given to us, the Company has not granted any
loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Accordingly, paragraph 3(iii) of the Order is not applicable.
iv. According to the information and explanations given to us and on the basis of our examination
of the records of the Company, the Company has not undertaken any transactions in respect of loans, guarantees and securities covered under section 185 of the Companies Act, 2013. The Company has not made any investment as referred in section 186(1) of the Act, other requirements relating to section 186 of the Act do not apply to the Company.
v. According to the information and explanations given to us, the Company has not accepted any deposits covered under of Section 73 to 76 of the Act.
vi. According to the information and explanations given to us, the Central Government has not
prescribed the maintenance of cost records under section 148(1) of the Act, for any of the business activities carried out by the Company.
vii. (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues of Provident Fund, Employees’ State Insurance, Income-tax, Service tax and other statutory dues have generally been regularly deposited with the appropriate authorities. As explained to us, the provisions of Sales-tax, Duty of Customs, Duty of Excise and Value added tax are not applicable to the Company.
Page 44 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees’ State Insurance, Income-tax, Service tax and other statutory dues were in arrears as at 31 March 2016 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, there are no dues in respect of Income-tax and Service tax which have not been deposited with the appropriate authorities on account of any dispute. As mentioned above, the Company did not have any dues on account of Sales-tax, Duty of Customs, Duty of Excise and Value added tax during the year.
viii. In our opinion and according to the information and explanations given to us, the Company
has not defaulted in repayment of dues to its bankers, financial institutions and debenture holders during the year. The Company did not have not outstanding dues to Government during the year.
ix. In our opinion and according to the information and explanations given to us, the term loans obtained and money raised through debt instruments during the year were applied for the purpose for which they were raised. Also, the Company did not raise any money by way of initial public offer or further public offer.
x. According to the information and explanations given to us, no fraud by the Company or on
the Company by its officers or employees has been noticed or reported during the course of
our audit.
xi. According to the information and explanations given to us, the managerial remuneration has
been paid/ provided in accordance with the provisions of section 197 read with Schedule V of the Act.
xii. According to the information and explanations given to us, the Company is not a Nidhi Company, hence paragraph 3(xii) of the Order is not applicable.
xiii. According to the information and explanations given to us, and on the basis of our
examination of the records of the Company, there are no transactions with the related parties which are not in compliance with Section 177 and 188 of the Companies Act, 2013 and the details have been disclosed in the financial statements, as required, by the applicable accounting standards.
xiv. According to the information and explanations given to us, the Company has not made any
preferential allotment or private placement of shares or fully or partly convertible debentures
during the year. xv. According to the information and explanations given to us and based on our examination of
the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.
Page 45 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 xvi. The Company is not required to be registered under Section 45-1A of the Reserve Bank of
India Act, 1934, and accordingly, paragraph 3(xvi) of the Order is not applicable.
For B S R & Associates LLP Chartered Accountants
Firm Registration No.: 116231W /W-100024
Manish Gupta
Place: Gurgaon Partner Date: 27 July 2016 Membership No.: 095037
Page 46 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 Annexure B to the Independent Auditor’s Report of even date on the financial statements of Shubham Housing Development Finance Company Limited (formerly known as Shubham Housing Development Finance Company Private Limited)
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
We have audited the internal financial controls over financial reporting of Shubham Housing
Development Finance Company Limited (formerly known as Shubham Housing Development Finance
Company Private Limited) (“the Company”) as of 31 March 2016 in conjunction with our audit of the
financial statements of the Company for the year ended on that date.
Management’s Responsibility for Internal Financial Controls
The Company’s management is responsible for establishing and maintaining internal financial controls
based on the internal control over financial reporting criteria established by the Company considering
the essential components of internal control stated in the Guidance Note on Audit of Internal Financial
Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’).
These responsibilities include the design, implementation and maintenance of adequate internal
financial controls that were operating effectively for ensuring the orderly and efficient conduct of its
business, including adherence to Company’s policies, the safeguarding of its assets, the prevention
and detection of frauds and errors, the accuracy and completeness of the accounting records, and the
timely preparation of reliable financial information, as required under the Act.
Auditor’s Responsibility
Our responsibility is to express an opinion on the Company's internal financial controls over financial
reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit
of Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on
Auditing, issued by ICAI and deemed to be prescribed under Section 143(10) of the Act, to the extent
applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial
Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the
Guidance Note require that we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether adequate internal financial controls over financial
reporting was established and maintained and if such controls operated effectively in all material
respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal
financial controls system over financial reporting and their operating effectiveness. Our audit of
internal financial controls over financial reporting included obtaining an understanding of internal
financial controls over financial reporting, assessing the risk that a material weakness exists, and
testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment
of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion on the Company’s internal financial controls system over financial reporting.
Page 47 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles. A
company's internal financial control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect
the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that receipts and expenditures of the company are
being made only in accordance with authorisations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorised
acquisition, use, or disposition of the company's assets that could have a material effect on the
financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the
possibility of collusion or improper management override of controls, material misstatements due to
error or fraud may occur and not be detected. Also, projections of any evaluation of the internal
financial controls over financial reporting to future periods are subject to the risk that the internal
financial control over financial reporting may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls
system over financial reporting and such internal financial controls over financial reporting were
operating effectively as at 31 March 2016, based on the internal control over financial reporting
criteria established by the Company considering the essential components of internal control stated
in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the
Institute of Chartered Accountants of India.
For B S R & Associates LLP
Chartered Accountants Firm Registration No.: 116231W/W-100024
Manish Gupta
Place: Gurgaon Partner Date: 27 July 2016 Membership No.: 095037
Page 48 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 To the Board of Directors of
Shubham Housing Development Finance Company Limited (formerly known as Shubham Housing Development Finance Company Private Limited)
Dear Sirs,
Subject: Report under paragraph 33 of Chapter IV of the 'Housing Finance Companies (NHB) Directions, 2010' In addition to our audit report issued under Section 143 of the Companies Act, 2013 (“the Act”) on the financial statements of Shubham Housing Development Finance Company Limited (formerly known as Shubham Housing Development Finance Company Private Limited) (“the Company”) for the year ended 31 March 2016 and as required by The Housing Finance Companies (NHB) Directions, 2010 (“the Directions”), we report as under on the matters specified in paragraph 34 and 35 of the Directions. This report is based on such checks and procedures as we considered appropriate and as per the information and explanations made available to us by the management: 1 The Company was incorporated on 23 February 2010 and was registered as a non-deposit taking housing finance company with the National Housing Bank ('NHB') vide certificate of registration dated 24 January 2011. During the current year, the Company was converted into a public limited company dated 28 March 2016, and accordingly, a fresh certificate was issued by NHB vide certificate no. 06.136.16 dated 23 June 2016 (issued in lieu of earlier certificate no. 01.0090.11 dated 24 January 2011). 2 According to the information and explanations given to us, the requirements of Section 29B of the National Housing Bank Act, 1987 ('NHB Act') are not applicable to the Company since it has not accepted/ held any public deposits during the year ended 31 March 2016;
3 During the year ended 31 March 2016, the Company has apportioned Rs. 11,181,605 towards the
statutory reserve in accordance with Section 29C of the NHB Act;
4 According to the information and explanations given to us, the Company has complied with the provisions of the Directions, in all material respects, to the extent applicable to it;
5 In our opinion the capital adequacy ratio as disclosed in the return submitted to the National Housing Bank as at 31 March 2016 was correctly determined in all material aspects based on the unaudited results of the Company. Further, such ratio is in compliance with the minimum capital to risk weighted asset ratio as prescribed by the National Housing Bank in the Directions.
6 According to the information and explanations given to us, the Company has not accepted any
public deposits during the current year and does not have any outstanding public deposit as on 31 March 2016. The Board of Directors passed a resolution on 28 April 2015 for non-acceptance of public deposits.
7 The Company has complied with the prudential norms, prescribed in the directions, in all material
respects, to the extent applicable to it.
Page 49 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16 This report has been prepared by B S R & Associates LLP as required under paragraph 33 of Chapter IV of the Housing Finance Companies (NHB) Directions 2010 in respect of Housing Finance Companies. This report is not intended for general circulation or publication and is not to be duplicated for any purpose without our prior written consent.
For B S R & Associates LLP
Chartered Accountants Firm registration no.: 116231W /W-100024
Manish Gupta Place: Gurgaon Partner Date: 27 July 2016 Membership No.: 095037
Page 50 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Balance Sheet as at 31 March 2016
(All amounts are in Indian Rupees)
Note As at As at
31 March 2016 31 March 2015
EQUITY AND LIABILITIES
Shareholders' funds
Share capital 2.1 342,93,300 342,93,300
Reserves and surplus 2.2 17566,72,643 16861,37,380
17909,65,943 17204,30,680
Non-current liabilities
Long-term borrowings 2.3 36096,83,766 23206,96,628
Long-term provisions 2.4 595,07,275 427,55,733
36691,91,041 23634,52,361
Current liabilities
Short-term borrowings 2.5 1000,00,000 1000,00,000
Trade payable 2.6
Total outstanding due of micro and small enterprises 1,29,667 -
Total outstanding due of creditors other than micro and small enterprises 221,29,561 124,17,357
Other current liabilities 2.7 13244,15,471 8672,67,651
Short-term provisions 2.4 94,04,943 53,30,002
14560,79,642 9850,15,010
TOTAL 69162,36,626 50688,98,051
ASSETS
Non-current assets
Fixed assets
Tangible fixed assets 2.8 183,69,689 148,92,385
Intangible fixed assets 2.8 1,75,103 1,01,730
Capital work-in-progress 125,88,248 -
Non-current investments 2.9 - 5,00,000
Deferred tax asset (net) 2.10 93,64,980 -
Long-term loans and advances 2.11 56231,25,557 37390,78,234
Other non-current assets 2.12 633,83,907 506,49,921
57270,07,484 38052,22,270
Current assets
Current investments 2.13 5,00,000 -
Trade receivables 2.14 264,78,356 89,47,178
Cash and bank balances 2.15 5984,02,427 9257,94,298
Short-term loans and advances 2.16 4422,45,413 2638,48,076
Other current assets 2.17 1216,02,946 650,86,229
11892,29,142 12636,75,781
TOTAL 69162,36,626 50688,98,051
Significant accounting policies 1
Notes to the financial statements 2 to 13
The notes referred to above form an integral part of the financial statements
As per our report of even date attached
For B S R & Associates LLP For and on behalf of the Board of Directors of
Chartered Accountants Shubham Housing Development Finance Company
Firm registration number: 116231W /W-100024 Limited (formerly known as Shubham Housing
Development Finance Company Private Limited)
Manish Gupta Ajay Mukund Oak Sanjay Chaturvedi
Partner Director Director
Membership number: 095037 DIN No.: 01779000 DIN No.: 01636432
Neeta Kamra Shashank Jain
Company Secretary Chief Financial Officer
Place: Gurgaon Place: Gurgaon
Date: 27 July 2016 Date: 27 July 2016
Page 51 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Statement of Profit and Loss for the year ended 31 March 2016
(All amounts are in Indian Rupees)
Note For the year ended For the year ended
31 March 2016 31 March 2015
Revenue
Revenue from operations 2.18 10211,61,641 5199,45,315
Other income 2.19 463,42,644 485,07,855
Total revenue 10675,04,285 5684,53,170
Expenses
Employee benefits 2.20 3072,17,231 1784,82,164
Finance costs 2.21 4736,45,790 2359,25,206
Depreciation and amortization expense 2.8 79,64,946 72,70,207
Other expenses 2.22 2107,52,096 1363,77,404
Total expenses 9995,80,063 5580,54,981
Profit before tax 679,24,222 103,98,189
Tax expense
Current tax 212,97,641 -
Current tax: Minimum alternative tax (MAT) - 41,89,590
Income tax charge (for earlier years) 83,535 -
MAT credit entitlement - -41,89,590
Deferred tax credit -93,64,980 -
Profit after tax 559,08,026 103,98,189
Earning per share (face value of Rs. 10 each)
Basic earnings per share 67.80 13.79
Diluted earnings per share 16.30 3.56
Significant accounting policies 1
Notes to the financial statements 2 to 13
The notes referred to above form an integral part of the financial statements
As per our report of even date attached
For B S R & Associates LLP For and on behalf of the Board of Directors of
Chartered Accountants Shubham Housing Development Finance Company
Firm registration number: 116231W /W-100024 Limited (formerly known as Shubham Housing
Development Finance Company Private Limited)
Manish Gupta Ajay Mukund Oak Sanjay Chaturvedi
Partner Director Director
Membership Number: 095037 DIN No.: 01779000 DIN No.: 01636432
Neeta Kamra Shashank Jain
Company Secretary Chief Financial Officer
Place: Gurgaon Place: Gurgaon
Date: 27 July 2016 Date: 27 July 2016
Page 52 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Cash Flow Statement for the year ended 31 March 2016
(All amounts are in Indian Rupees)
For the year ended For the year ended
31 March 2016 31 March 2015
Cash flow from Operating activities
Profit before tax 679,24,222 103,98,189
Adjustments for:
Depreciation and amortization expense 79,64,946 72,70,207
Housing Loans:
Contingent provision against standard assets 33,18,691 70,80,699
Provision for non-performing assets 168,43,988 246,07,286
Non Housing Loans:
Contingent provision against standard assets 58,05,949 25,19,619
Provision for non-performing assets 6,86,626 20,99,461
Interest on fixed deposits (131,08,875) (111,68,104)
Profit on redemption of mutual funds (net) (314,60,865) (90,10,160)
Dividend income - (261,66,770)
Finance cost -
Capital work-in-progress written off - 20,000
Provision for loss on stock of acquired property 20,06,093 3,99,266
Employee stock option compensation expense -
Loss on sale of fixed assets 44,596 14,366
Loan assets written-off 336,00,755 -
Employee stock option compensation expense 146,27,237 -
Discount on Commercial Papers 60,53,538 -
Operating profit before working capital changes 1143,06,901 80,64,059
Adjustments for :
(Increase)/decrease in long term loans and advances (19270,95,210) (22867,93,207)
(Increase)/decrease in other non-current assets (157,33,986) (184,67,768)
(Increase)/decrease in short-term loans and advances (1793,80,912) (1658,87,471)
(Increase)/decrease in other current assets (526,69,126) (343,02,393)
(Increase)/decrease in trade receivables (175,31,178) (49,44,856)
Increase/(decrease) in trade payables 98,41,871 57,69,891
Increase/(decrease) in current liabilities 70,12,647 2506,96,432
Increase/(decrease) in long-term and short-term provisions 32,21,099 21,19,911
Cash used in operations (20580,27,894) (22437,45,402)
Income taxes paid (net of tax refund amounting to Rs. 856,693 (previous year Rs. Nil) (188,29,575) (46,84,288)
Net cash used in operating activities (A) (20768,57,469) (22484,29,690)
Cash flow from Investing activities
Purchase of mutual funds (28195,00,006) (14753,55,280)
Sale of mutual funds 28509,60,871 15843,65,440
Dividend income - 261,66,770
Purchase of fixed assets and increase in capital work-in-progress (net of payable for capital goods) (185,52,291) (134,99,506)
Sale of fixed assets 8,400 17,221
(Increase)/ decrease in fixed deposit with a maturity more than 90 days (29,38,033) (326,58,169)
Interest received on fixed deposits 126,78,153 97,38,570
Net cash used in investing activities (B) 226,57,094 987,75,046
Cash flow from Financing activities
Proceeds from borrowings 25110,23,500 21100,00,000
Repayment of borrowings (7901,53,029) (3847,85,369)
Proceeds from issue of shares (including securities premium(net) {current year Rs. Nil (previous - 12053,84,677
year amounting to Rs. 1,190,932,927)}
Net cash generated from financing activities (C) 17208,70,471 29305,99,308
Net increase/ (decrease) in cash and cash equivalents (A+B+C) (3333,29,904) 7809,44,664
Cash and cash equivalents as at the beginning of the year 8498,95,048 689,50,384
Cash and cash equivalents as at the end of the year 5165,65,144 8498,95,048
Page 53 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Cash Flow Statement for the year ended 31 March 2016
(All amounts are in Indian Rupees)
For the year ended For the year ended
31 March 2016 31 March 2015
Notes:
Cash and bank balance include
Cash in hand 93,68,654 21,99,131
Cheques in hand 68,74,301 97,29,904
Balances with bank
- on current accounts 1503,22,189 3729,66,013
- on deposit accounts (with original maturity of 3 months or less) 3500,00,000 4650,00,000
Cash and cash equivalents at the end of the year 5165,65,144 8498,95,048
Other bank balance
Fixed deposits (with remaining maturity within 12 months from the reporting date) 818,37,283 758,99,250
Other non-current assets
Fixed deposits (due to mature after 12 months from the reporting date) 200,00,000 230,00,000
Cash and bank balance 6184,02,427 9487,94,298
Notes:
a) The cash flow statement has been prepared in accordance with the 'Indirect Method' as set out in the Accounting Standard (AS)-3 on 'Cash Flow Statement', specified
under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.
b) Cash and cash equivalents consists of cash in hand and balances with scheduled banks. (Refer note 2.15)
c) Negative figures have been shown in brackets.
As per our report of even date attached
For B S R & Associates LLP For and on behalf of the Board of Directors of
Chartered Accountants Shubham Housing Development Finance Company Limited
Firm registration number: 116231W /W-100024 (formerly known as Shubham Housing Development Finance
Company Private Limited)
Manish Gupta Ajay Mukund Oak Sanjay Chaturvedi
Partner Director Director
Membership Number: 095037 DIN No.: 01779000 DIN No.: 01636432
Neeta Kamra Shashank Jain
Company Secretary Chief Financial Officer
Place: Gurgaon Place: Gurgaon
Date: 27 July 2016 Date: 27 July 2016
Page 54 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Significant Accounting Policies and Notes forming part of Financial Statements 1A. Background
Shubham Housing Development Finance Company Limited (formerly known as Shubham housing Development Finance Company Private Limited) (the ‘Company’) was incorporated in India on 23 February 2010 as a private limited company under the Companies Act 1956. The Company is registered with the National Housing Bank (NHB) as a Housing Finance Company vide Certificate No. 06.136.16 dated 23 June 2016 (issued in lieu of earlier Certificate No.
01.0090.11 dated 24 January 2011). The Company is in the business of providing housing and
non-housing loans.
During the current year, the Company was converted into a public limited company pursuant to approval of the Shareholders in an extra-ordinary general meeting held on 28 March 2016 and consequently the name of the Company was changed to Shubham Housing Development Finance Company Limited and a fresh certificate of incorporation consequent upon conversion to Public Limited Company was issued by the Registrar of Companies on 24 May 2016. The corporate identification number of the Company is: U65921DL2010ELC199469.
1B. Significant accounting policies
a) Basis of preparation and presentation of financial statements The financial statements have been prepared and presented under the historical cost convention on the accrual basis of accounting, in accordance with the Indian Generally Accepted Accounting Principles (GAAP), Accounting Standards specified under Section 133 of the Companies Act, 2013 (‘the Act’), read with Rule 7 of the Companies (Accounts) Rules, 2014 and the provisions of the Companies Act, 2013, as adopted consistently by the Company. The Company complies with the prudential norms relating to income recognition, accounting standards, asset classification and the minimum provisioning for standard assets, substandard assets, doubtful assets and loss assets, specified in the directions issued by the NHB in terms of The Housing Finance Companies (NHB) Directions, 2010, as applicable to it.
b) Use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from these estimates. Any changes in estimates are adjusted prospectively.
c) Current/ Non-current classification
All assets and liabilities are classified into current and non-current. Assets
An asset is classified as current when it satisfies any of the following criteria:
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
a. it is expected to be realised in, or is intended for sale or consumption in, the
company’s normal operating cycle; b. it is held primarily for the purpose of being traded; c. it is expected to be realised within 12 months after the reporting date; or d. it is cash or cash equivalent unless it is restricted from being exchanged or used to
settle a liability for at least 12 months after the reporting date.
Current assets include the current portion of non-current financial assets. All other assets are
classified as non-current. Liabilities
A liability is classified as current when it satisfies any of the following criteria:
a. it is expected to be settled in the company’s normal operating cycle; b. it is held primarily for the purpose of being traded; c. it is due to be settled within 12 months after the reporting date; or d. the company does not have an unconditional right to defer settlement of the liability
for at least 12 months after the reporting date.
Current liabilities include current portion of non-current financial liabilities. All other liabilities are classified as non-current.
Operating cycle Operating cycle is the time between the acquisition of assets for processing and their
realisation in cash or cash equivalents. d) Revenue recognition
The Company follows the Housing Finance Companies (NHB) Directions, 2010 issued by the NHB and Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 for income recognition. Reversal of income on non-performing assets necessitated by these guidelines, are netted-off from the income from operations.
Interest is accounted on accrual basis except for non-performing assets in respect of which income is recognised on receipt. No income is accrued on accounts delinquent for more than 90 days. Payment received on delinquent accounts is applied first towards principal and then towards interest and other charges.
Income from loan transactions
i. Interest income on loans disbursed is accounted for by applying the Internal Rate of
Return (IRR), implicit in the agreement, on the diminishing balance of the financed amount, over the period of the agreement so as to provide a constant periodic rate of return on the net amount outstanding on the contracts.
Processing fee and other charges
i. Loan processing fees is recognized on upfront basis.
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
ii. Other charges (penal interest, cheque bouncing charges etc.) are recognised on receipt
basis. Interest income on fixed deposits
i. Interest on fixed deposits is recognized on a time proportion basis taking into account
the amount outstanding and the rate applicable on the fixed deposit.
Other income i. Income on account of excess interest spread arising from securitisation and income from
assignment transaction is recognised on accrual basis, net of any related losses.
ii. Profit or loss on sale of investments is determined based on the weighted average cost of the investment sold.
iii. Dividend income is recognised when the right to receive payment is established.
e) Provision for standard and non-performing assets
Provision for standard assets and non-performing assets are created in accordance with prudential norms and guidelines issued by NHB. Also, specific provisions in respect of standard assets and non-performing assets are created based on the management’s best estimates, which are determined having regard to overall loan portfolio quality, asset growth, economic conditions and other risk factors.
In accordance with Para 29 of The Housing Finance Company (NHB) Directions, 2010, the Company has separately shown provision for loans under short-term/ long-term provisions (as applicable) without netting off from loans.
During the current year and previous year, the Company has followed the following policy for identification and provisioning in respect of standard assets and provision for non-performing assets:
Asset classification
Criteria Rate of provision for the year ended 31 March 2016 (% of total loan outstanding) ##
Standard assets Standard assets An asset, in respect of which, no default in repayment of
principal or payment of interest is perceived. 0.4
Non-performing assets (NPA) - An asset, in respect of which, principal/interest has remained overdue for a period of more than 90 days.
Sub-standard assets
NPA for less than or equal to 12 months 15
Doubtful assets # NPA for more than 12 months
Doubtful for up to 1 year * 25
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Doubtful for more than 1 year but less than or equal to 3
years ** 40
Doubtful for more than 3 years 100
Loss assets As identified Written off from books
If the assets are permitted to remain in the books for any reason
100
Asset classification
Criteria Rate of provision for the year ended 31 March 2015 (% of total loan outstanding)###
Standard assets
Standard assets An asset, in respect of which, no default in repayment of principal or payment of interest is perceived.
0.4
Non-performing assets (NPA) - An asset, in respect of which, interest has remained overdue for a period of more than 90 days.
Sub-standard assets
NPA for less than or equal to 360 days 15
Doubtful assets # NPA for more than 360 days but less than or equal to 720 days
40
NPA for more than 720 days 100
Loss assets As identified Written off from books
# In respect of doubtful assets, an additional 100% provision is recorded to the extent to which the loan is not covered by the realisable value of the security to which the Company has a valid recourse.
During the current year, the Company has changed the policy of assets classification and provisioning to comply with the classification and provisioning guidance as per Master circular - The Housing Finance Company (NHB) Directions, 2010. Also, the Company has taken additional provision for doubtful assets on the basis of Company’s estimates made in the current/ earlier years as detailed below:
* Doubtful up to 1 year: additional provision of 15% (i.e. total 40% of outstanding asset in such asset class)
** Doubtful for more than 1 year but less than or equal to 3 years: additional provision of 60% (i.e. total 100% of outstanding asset in such asset class)
##The change in estimate is a result of management evaluation/ expectations of future performance of the portfolio, measures taken by the Company and the actual performance of the related portfolio. Had the Company continued to apply the earlier provisioning percentages, considering the net impact of above changes, the profit would have been lower by Rs. 1,348,728.
### During the previous year, the Company had changed the percentages of provisioning to be applied for doubtful assets (NPA for more than 360 days but less than or equal to 720 days)
Page 58 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
from 50% to 40%. Had the Company continued to apply the earlier provisioning percentages as in the year ended 31 March 2014, profit would have been lower by Rs. 1,183,541 in the year ended 31 March 2015.
f) Expenditure
Interest expense
Interest on borrowings is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable on the borrowing.
Processing fees on borrowings
The Company pays processing fees and arranger fees to obtain borrowings from Banks and other companies. Fee so incurred is recognised as expense over the tenor. The unamortised balance is disclosed as part of other current/ non-current assets.
g) Securitised/Assigned assets
Securitised/Assigned assets are derecognised in the books of the Company based on the principle of transfer of ownership interest over the assets. De-recognition of such assets and recognition of gain or loss arising on such securitisation is based on the Guidance Note on Accounting for Securitisation issued by the Institute of Chartered Accountants of India.
h) Tangible fixed assets
Tangible fixed assets are stated at cost of acquisition less accumulated depreciation. The cost of an item of tangible fixed assets comprises its purchase price, including import duties and other non-refundable taxes or levies and any directly attributable cost of bringing the asset to its working condition for its intended use.
i) Depreciation
With effect from 1 April 2014, tangible fixed assets are depreciated on written down value method basis useful life specified in Part ‘C’ of Schedule II to the Act, except for Computer and data processing unit, where the management’s estimate of the useful life of such fixed asset is higher than the life arrived at on the basis of Schedule II of the Act.
Accordingly, based on the internal technical evaluation conducted during the previous year, the Company had depreciated computers and data processing units over a period of 5 years. The management believes that the said useful lives best represent the period over which management expects to use these assets.
As consequence of revision in the useful life of the assets in the previous year, depreciation
charge during the previous year was higher by Rs. 1,670,605. Depreciation on additions is being provided on pro rata basis from the date of such additions. Similarly, depreciation on assets sold / disposed off during the year is being provided up to the dates on which such assets are sold / disposed off. Modification or extension to an existing asset, which is of capital nature and which becomes an integral part thereof is depreciated prospectively over the remaining useful life of that asset.
Page 59 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
j) Impairment
Management periodically assesses, using external and internal sources, whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of the future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the assets net selling price and present value as determined above. An impairment loss is reversed if there has been a change in the estimate used to determine the recoverable amount. An impairment loss is recorded only to the extent that assets carrying cost does not exceed the carrying amount that would have been determined net of depreciation and amortisation, if no impairment loss has been recognised.
k) Earnings per share
The basic earnings per share is computed by dividing the net profit attributable to equity shareholders for the year by the weighted average number of equity shares outstanding during the year. Dilutive earnings per share is computed and disclosed after adjusting the effects of all dilutive potential equity shares, if any, except when the results will be anti-dilutive.
l) Leases Assets acquired under leases other than finance leases are classified as operating leases. The total lease rentals (including scheduled rental increases) in respect of an asset taken on operating lease are charged to the Statement of Profit and Loss on a straight line basis over the lease term.
m) Income taxes
Income-tax expense comprises current tax (i.e. amount of tax for the year determined in accordance with the income-tax laws) and deferred tax charge or credit (reflecting the tax effect of timing differences between accounting income and taxable income for the year). Current tax is measured at the amount expected to be paid to (recovered from) the taxation authorities, using the applicable tax rates and tax laws. Deferred tax is recognised in respect of timing differences between taxable income and accounting income i.e. differences that originate in one period and are capable of reversal in one or more subsequent periods. The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the tax rates and tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future; however, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realised. Deferred tax assets are reviewed as at each balance sheet date and written down or written-up to reflect the amount that is reasonably/virtually certain (as the case may be) to be realised.
In accordance with the provisions of Section 115JAA of the Income-tax Act, 1961, the Company is allowed to avail credit equal to the excess of Minimum Alternate Tax (MAT) over normal income tax for the assessment year for which MAT is paid. MAT credit so determined can be carried forward for set-off for ten succeeding assessment years from the year in which such
Page 60 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
credit becomes allowable. MAT credit can be set-off only in the year in which the Company is liable to pay tax as per the normal provisions of the Income-tax Act, 1961 and such tax is in excess of MAT for that year. Accordingly, MAT credit entitlement is recognised only to the extent there is convincing evidence that the Company will pay normal tax during the specified period.
n) Transactions in foreign exchange
Foreign currency transactions are accounted for at the exchange rate prevailing on the date of the transaction. Exchange differences arising due to the differences in the exchange rate between the transaction date and the date of settlement of any monetary items is recognised in the Statement of Profit and Loss.
Monetary assets and monetary liabilities denominated in foreign currency are translated at the exchange rate prevalent at the date of the Balance Sheet and resultant gain/ loss, if any, is recorded as an income or any expense in the period in which they arise.
o) Investments
Investments that are readily realisable and intended to be held for not more than a year from the date of acquisition are classified as current investments. All other investments are classified as long-term investments. However, that part of long-term investments which is expected to be realised within 12 months after the reporting date is also presented under ‘current assets’ as “current portion of long-term investments” in consonance with the current/ non-current classification scheme of Schedule III of the Companies Act, 2013.
Current investments are carried at the lower of cost and fair value. The comparison of cost and fair value is done separately in respect of each category of investments i.e., equity shares, mutual funds, preference shares, convertible debentures etc. Long-term investments (including current portion thereof) are carried at cost less any other-than-temporary diminution in value, determined separately for each individual investment.
p) Employee benefits
The Company’s obligation towards various employee benefits has been recognised as follows:
Short-term employee benefits All employee benefits payable/ available within twelve months of rendering the service are classified as short-term employee benefits. Benefits such as salaries, wages and bonus etc., are recognised in the Statement of Profit and Loss in the period in which the employee renders the related service.
Post-employment benefits
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays specified contributions to a separate entity and has no obligation to pay any further amounts. The Company makes specified monthly contributions towards employee provident fund to Government administered provident fund scheme which is a defined contribution plan. The
Page 61 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Company’s contribution is recognised as an expense in the Statement of Profit
and Loss during the period in which the employee renders the related service.
Defined benefit plans The Company’s gratuity scheme is a defined benefit plan. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation carried by an independent actuary at the year-end using the Projected Unit Credit Method at the Balance Sheet date, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The Company has taken a policy from Birla Sun Life Insurance Company Limited to cover its liabilities towards employees’ gratuity. Net unfunded / funded obligation is disclosed in the Balance Sheet as the case may be.
Compensated absences The employees can carry-forward a portion of the unutilised accrued compensated absences and utilise it in future service periods or receive cash compensation on termination of employment. Since the compensated absences do not fall due wholly within twelve months after the end of the period in which the employees render the related service and are also not expected to be utilised wholly within twelve months after the end of such period, the benefit is classified as a long-term employee benefit. The Company records an obligation for such compensated absences in the period in which the employee renders the services that increase this entitlement. The obligation is measured on the basis of independent actuarial valuation using the Projected Unit Credit Method. The obligation is measured at the present value of estimated future cash flows. The discount rates used for determining the present value of obligation under defined benefit plans, is based on the market yields on Government securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations.
Treatment of actuarial gains and losses Actuarial gains and losses are recognised immediately in the Statement of Profit and loss. Gains or losses on the curtailment or settlement of any defined plan are recognised when the curtailment or settlement occurs.
q) Share-based payments
The Company accounts for equity settled stock options as per the accounting treatment prescribed by guidance note issued by The Institute of Chartered Accountants of India. The Employee Stock Option Scheme (‘the Scheme’) provides for the grant of options to acquire equity shares of the Company to its employees. The options granted to employees vest in a graded manner and these may be exercised by the employees within a specified period. The Company follows the fair value method to account for its stock-based employee compensation plan. Compensation cost is measured by the excess, if any, of the fair value of the underlying stock over the exercise price as determined under the option plan. The fair value is considered
Page 62 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
on the basis of valuation report. Compensation cost, if any, is amortised
over the vesting
period.
r) Provisions
A provision is recognised if, as a result of a past event, the Company has a present obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are recognised at the best estimate of the expenditure required to settle the present obligation at the Balance Sheet date. The provisions are measured on an undiscounted basis.
s) Contingent liabilities and contingent assets
A contingent liability exists when there is a possible but not probable obligation, or a present obligation that may, but probably will not, require an outflow of resources, or a present obligation whose amount cannot be estimated reliably. Contingent liabilities do not warrant provisions, but are disclosed unless the possibility of outflow of resources is remote.
Contingent assets are neither recognised nor disclosed in the financial statements. However, contingent assets are assessed continually and if it is virtually certain that an inflow of economic benefits will arise, the asset and related income are recognised in the period in which the change occurs.
t) Cash and cash equivalents Cash and cash equivalents comprises of cash balance with bank and highly liquid investments with maturity period of three months or less from the date of investment.
Page 63 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
As at 31 March 2016 As at 31 March 2015
Number of shares Amount Number of shares Amount
2.1 Share capital
Authorised
Equity shares of Rs. 10 each 20,00,000 200,00,000 20,00,000 200,00,000
Preference shares of Rs. 10 each 40,00,000 400,00,000 40,00,000 400,00,000
60,00,000 600,00,000 60,00,000 600,00,000
Issued, subscribed and fully paid up
Equity shares of Rs. 10 each 9,43,690 94,36,900 9,43,690 94,36,900
Compulsorily convertible preference shares of Rs. 10 each-Series A 5,71,328 57,13,280 5,71,328 57,13,280
Compulsorily convertible preference shares of Rs. 10 each-Series B 5,29,424 52,94,240 5,29,424 52,94,240
Compulsorily convertible preference shares of Rs. 10 each-Series C 13,84,888 138,48,880 13,84,888 138,48,880
34,29,330 342,93,300 34,29,330 342,93,300
(a) (i) Reconciliation of equity shares outstanding at the beginning and at the end of the reporting period
As at 31 March 2016 As at 31 March 2015
Number of shares Amount Number of shares Amount
Outstanding at the beginning of the year 9,43,690 94,36,900 6,19,187 61,91,870
Add: Shares issued on conversion of compulsorily convertible preference - - 2,64,216 26,42,160
shares during the year
Add: Share issued during the year - - 60,287 6,02,870
Outstanding at the end of the year 9,43,690 94,36,900 9,43,690 94,36,900
(ii) Rights, preference and restrictions attached to equity shares
The Company has only one class of equity shares having the par value of each share is Rs.10. Each shareholder shall have voting right equal to shareholding percentage of the
total of the shares issued including compulsorily convertible preference shares on an as if converted basis. The dividend proposed by the Board of Directors is subject to the
approval of the shareholders. In the event of liquidation, the equity shareholders are eligible to receive the remaining asse ts of the Company, after distribution of all
preferential amount, in proportion to their shareholdings.
(iii) Details of equity shares held by shareholders holding more than 5% of the aggregate shares in the Company
As at 31 March 2016 As at 31 March 2015
Number of shares % holding in Number of shares % holding in
the class the class
Sanjay Chaturvedi 2,50,000 26.49 2,50,000 26.49
Ajay Mukund Oak 2,50,000 26.49 2,50,000 26.49
Shubham Employees Welfare Trust 1,19,047 12.62 1,19,047 12.62
Helion Venture Partners II LLC 93,763 9.94 93,763 9.94
Elevar Equity Mauritius 93,763 9.94 93,763 9.94
Page 64 of 89
Shubham Housing Development Finance Company Limited (formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the period ended 31 March 2016
(All amounts are in Indian Rupees)
(b) (i) Reconciliation of Compulsorily convertible preference shares ('CCPS') outstanding at the beginning and at the end of the reporting period
As at 31 March 2016 As at 31 March 2015
Number of shares Amount Number of shares Amount
Series A
Outstanding at the beginning of the year 5,71,328 57,13,280 5,71,328 57,13,280
Add: Shares issued during the year - - - -
Less: Converted into equity shares during the year - - - -
Outstanding at the end of the year 5,71,328 57,13,280 5,71,328 57,13,280
Series B
Outstanding at the beginning of the year 5,29,424 52,94,240 7,93,640 79,36,400
Add: Shares issued during the year - - - -
Less: Converted into equity shares during the year - - 2,64,216 26,42,160
Outstanding at the end of the year 5,29,424 52,94,240 5,29,424 52,94,240
Series C
Outstanding at the beginning of the year 13,84,888 138,48,880 - -
Add: Shares issued during the year - - 13,84,888 138,48,880
Less: Converted into equity shares during the year - - - -
Outstanding at the end of the year 13,84,888 138,48,880 13,84,888 138,48,880
(ii) Rights, preference and restrictions attached to Compulsorily convertible preference shares ('CCPS')
The Company has issued its compulsorily convertible preference shares in series A, B and C having a par value of Rs. 10 per share. Each shareholder of the Company is entitled to vote in proportion of the share
of paid-up capital of the Company held by the Shareholder. The shares will carry a non-cumulative dividend right of 0.01% per annum on the subscription amount in preference to other class of shares as and when
and if declared by the Board. The shares are convertible in ratio of 1 equity share for 1 CCPS.
For series A shares, the shares will be automatically converted into equity shares either 2 days prior to filing of the draft red herring prospectus in connection with the occurrence of the qualified Initial Public
Offer (IPO) or 31 July 2029, whichever is earlier.
For series B shares, the shares will be automatically converted into equity shares either 2 days prior to filing of the draft red herring prospectus in connection with the occurrence of the qualified IPO or 25 July
2032, whichever is earlier. Also, refer to note below.
For series C shares, the shares will be automatically converted into equity shares either 2 days prior to filing of the draft red herring prospectus in connection with the occurrence of the qualified IPO or 25 July
2032, whichever is earlier.
Note: During the year, Nil (previous year: 264,216) Compulsory convertible preference shares were converted into equity shares, after taking consent of existing shareholders.
(iii) Details of preference shares held by shareholders holding more than 5% of the aggregate shares in the Company
As at 31 March 2016 As at 31 March 2015
Series-A Series-B Series-C % holding in Series-A Series-B Series-C % holding in
the class the class
Helion Venture Partners II LLC 2,85,664 1,04,701 2,52,066 25.85% 2,85,664 1,04,701 2,52,066 25.85%
Elevar Equity Mauritius 2,85,664 1,04,701 2,52,066 25.85% 2,85,664 1,04,701 2,52,066 25.85%
Accion Africa Asia Investment Company - 1,60,011 1,03,305 10.59% - 1,60,011 1,03,305 10.59%
Saama Capital II Limited - 1,60,011 1,03,305 10.59% - 1,60,011 1,03,305 10.59%
India Business Excellence Fund- IIA - - 4,34,933 17.50% - - 4,34,933 17.50%
Motilal Oswal Securities Limited - - 2,39,213 9.62% - - 2,39,213 9.62%
Total 5,71,328 5,29,424 13,84,888 5,71,328 5,29,424 13,84,888
Page 65 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
As at As at
31 March 2016 31 March 2015
2.2 Reserves and surplus
(i) Securities premium account
Balance as at the beginning of the year 16964,01,655 5054,68,728
Add: Received during the year - 12055,50,600
Less: Adjustment on account of expenses at the time of issue of shares - 146,17,673
Balance as at the year end 16964,01,655 16964,01,655
(ii) Special reserve {refer note (a) and (b) below}
Balance as at the beginning of the year 23,68,583 2,88,945
Add: Transferred during the year 111,81,605 20,79,638
Balance as at the year end 135,50,188 23,68,583
(iii) Employees Share Options Outstanding {refer to Note 1B(q)}
Balance as at the beginning of the year - -
Add: Transferred from Statement of Profit and Loss 146,27,237 - Balance as at the year end 146,27,237 -
(iii) Deficit in the Statement of Profit and Loss
Balance as at the beginning of the year (126,32,858) (209,51,409)
Add: Profit during the year 559,08,026 103,98,189
Less: Transfer to special reserve {refer note (a) and (b) below} (111,81,605) (20,79,638) Balance as at the year end 320,93,563 (126,32,858)
17566,72,643 16861,37,380
Notes:
(a) As per Section 29C(i) of the National Housing Bank, Act 1987 (NHB Act), the Company is required to transfer at least 20% of its net profit every year to a
reserve before any dividend is declared. For this purpose, any Special reserve created by the Company under Section 36(1)(viii) of the Income-tax Act, 1961 is
considered to be an eligible transfer.
Accordingly, during the year ended 31 March 2016, the Company has appropriated Rs. 11,181,605 (previous year Rs. 2,079,638) towards the special reserve in
terms of Section 29C of the National Housing Bank, Act 1987 (NHB Act).
As at As at
(b) Disclosure in term of Circular no. NHB(ND/DRS/Pol Circular 61/2013-14 dated 07 April 2014 31 March 2016 31 March 2015
Balance at the beginning of the year
Statutory Reserve under Section 29C of the NHB Act,1987 23,68,583 2,88,945
Amount of special reserve under section 36(1)(viii) of Income-tax Act, 1961, taken into account for the - -
purposes of statutory reserve under Section 29C of the NHB Act, 1987
Total 23,68,583 2,88,945
Addition / appropriation/ withdrawal during the year
Add: -Amount transferred Section 29C of the NHB Act, 1987 - 20,79,638
-Amount of special reserve under Section 36(1)(viii) of Income-tax Act 1961, taken into 111,81,605 -
account for the purposes of statutory reserve under Section 29C of the NHB Act, 1987
Total 111,81,605 20,79,638
Less -Amount appropriated from statutory reserve under section 29C of the NHB Act, 1987 - -
-Amount withdrawn from the special reserve under section 36(1)(viii) of Income-tax Act, - -
1961, taken into account for the purposes of statutory reserve under Section 29C of the
NHB Act, 1987
Balance at the end of the year
Statutory reserve under section 29C of the NHB Act, 1987 23,68,583 23,68,583
Amount of special reserve under section 36(1)(viii) of Income-tax Act, 1961, taken into account for the 111,81,605 -
purposes of Statutory reserve under Section 29C of the NHB Act, 1987
Total 135,50,188 23,68,583
Page 66 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
2.3 Long-term borrowings
Footnote Non-current Current maturities* Total As at
31 March 2016
As at 31 March 2015
As at 31 March 2016
As at 31 March 2015
As at 31 March 2016
As at 31 March 2015
Secured 1) Term loans
- From banks
- From other parties
2) Others loans
- From National housing bank
(refinance)
Unsecured
1) Debentures
- Redeemable Non Convertible
Debentures
2.3 (1)(i)
2.3 (1)(ii)
2.3 (2)
2.3 (3)
20655,86,152
13058,97,614
382,00,000
2000,00,000
16777,27,270
5968,69,358
461,00,000
-
5912,03,874
3885,08,617
52,00,000
-
3792,89,299
1583,63,360
39,00,000
-
26567,90,026
16944,06,231
434,00,000
2000,00,000
20570,16,569
7552,32,718
500,00,000
-
36096,83,766 23206,96,628 9849,12,491 5415,52,659 45945,96,257 28622,49,287
*Current portion of long-term borrowings amounting to Rs. 984,912,491 (previous year Rs.541,552,659) have been disclosed under 'Other current liabilit ies'.
Nature of security and terms of repayment for secured borrowings
Note No. 2.3 (1)(i): Security and terms of repayment for term loans from banks
No. Lender Terms of repayments Loan outstanding as on 31 Loan outstanding as on 31 Details of security /guarantee
March 2016 March 2015
1 Central Bank of India (Term loan ● Repayment terms: Monthly instalments 609,69,577 752,01,556 (1) Exclusive charge over the receivables arising out of Home Loan
I) ● Date of maturity : 14 July 2020 receivables with 1.10 times.
● Number of instalments : 84 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 52 Chaturvedi) to the full extent of the loan amount.
● Amount of instalment: Rs. 1,186,000
{principal (51 instalments and Rs. 483,577 in
last instalment)}
● Rate of interest : Bank base rate plus 1.90%
per annum. ● Moratorium period : 18 months
2 Central Bank of India (Term loan ● Repayment terms: Monthly instalments 2214,28,584 2607,14,292 (1) Exclusive charge over the receivables arising out of Home Loan
II) ● Date of maturity :30 April 2021 receivables with 1.10 times.
● Number of instalments : 84 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 62 Chaturvedi) to the full extent of the loan amount.
● Amount of instalment: Rs. 3,571,428
{principal (61 instalments and last instalment
for Rs. 3,571,476)
● Rate of interest : Bank base rate plus 1.90%
per annum.
3 Yes Bank Limited (Term Loan I) ● Repayment terms: Monthly instalments
● Date of maturity :23 August 2018
● Number of instalments : 60 Balance
instalments: 29
● Amount of instalment: Rs. 1,666,667
(principal)
● Rate of interest : Bank base rate plus 1.5%
per annum.
● Moratorium period : 13 months
483,33,334 683,33,334 (1) Primary security: Hypothecation of book debts both present and future
with a minimum cover of 1.25 times of the outstanding loan amount. Personal
Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay Chaturvedi) to the full
extent of the loan amount.
(2) Additional security : Agreement to assign mortgage on housing units to the
extent of loan amount in favor of the Yes Bank Limited in case of default.
4 Yes Bank Limited (Term Loan ● Repayment terms: Monthly instalments 575,75,758 939,39,382 (1) Exclusive charge on all the Book Debts of the borrower having minimum 575,75,758
II) ● Date of maturity : 31 October 2017 security cover of 1.11 times
● Number of instalments : 33 Balance (2) Unconditional and irrevocable Personal Guarantee of Promoters (Mr.
instalments: 19 Ajay Oak and Mr. Sanjay Chaturvedi) to the full extent of the loan amount.
● Amount of instalment: Rs. 3,030,303
(principal)
● Rate of interest : Bank base rate plus 2.75%
per annum.
● Moratorium period : 3 months
5 Ratnakar Bank Limited (Term ● Repayment terms: Quarterly instalments 315,00,000 455,00,000 (1) Exclusive first charge on portfolio of receivables including underlying
Loan-I) ● Date of maturity : 30 June 2018 security to the extent of 1.10 times.
● Number of instalments : 20 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 9 Chaturvedi).
● Amount of instalment: Rs. 3,500,000
(principal)
● Rate of interest : Bank base rate plus 1.25%
per annum.
● Moratorium period : 3 months
6 Ratnakar Bank Limited ● Repayment terms: Quarterly instalments 360,00,000 480,00,000 (1) Exclusive first charge on portfolio of receivables including underlying
(Term Loan-II) ● Date of maturity : 30 January 2019 security to the extent of 1.10 times.
● Number of instalments : 20 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 12 Chaturvedi).
● Amount of instalment: Rs. 3,000,000
(principal)
● Rate of interest : Bank base rate plus 1.80%
per annum.
● Moratorium period : 3 months
7 Ratnakar Bank Limited ● Repayment terms: Quarterly instalments 1750,00,000 2250,00,000 (1) Exclusive first charge on portfolio of receivables including underlying
(Term Loan III) ● Date of maturity : 28 July 2019 security interest as acceptable to bank from to time covering 1.10 times of the
● Number of instalments : 20 Balance principal at any point of time during the currency of the facility
instalments: 14 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: Rs. 12,500,000 Chaturvedi).
(principal)
● Rate of interest : Bank base rate plus 1.80%
per annum.
● Moratorium period : 3 months
Page 67 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
No. Lender Terms of repayments Loan outstanding as on Loan outstanding as on 31 Details of security /guarantee
31 March 2016 March 2015
8 Development Credit Bank ● Repayment terms: Monthly instalments 50,00,010 150,00,006 (1) Exclusive hypothecations charge on the Company's home loan receivables 50,00,010
Limited (Term Loan -I) ● Date of maturity : 10 September 2016 and book debts created out of loan cover of 1.10 times and Mortgage of
● Number of instalments : 36 Balance housing units to be extent of 1.00 times
instalments: 6 (2) Cash Collateral 10% of loan amount in form of Fixed deposit Rs.
● Amount of instalment: Rs. 833,333 3,000,000 with bank.
{principal (5 instalments and last instalment (3) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
for Rs. 833,345) Chaturvedi).
● Rate of interest : Bank base rate plus 2.50%
per annum.
● Moratorium period : 4 months
9 Development Credit Bank ● Repayment terms: Monthly instalments 727,27,300 1000,00,000 (1) Exclusive hypothecations charge on the Company's home loan receivables 727,27,300
Limited (Term Loan -II) ● Date of maturity : 31 March 2018 and book debts created out of loan with cover of 1.10 times.
● Number of instalments : 33 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 24 Chaturvedi).
● Amount of instalment: Rs. 3,030,300
{principal (23 instalments and last instalment
for Rs. 3,030,400)
● Rate of interest : Bank base rate plus 2.15%
i.e. 13% per annum.
● Moratorium period : 3 month
10 Canara Bank ● Repayment terms: Quarterly instalments 1584,00,000 1866,66,666 (1) Exclusive charge over receivables arising out of home loan with 1.11
● Date of maturity :23 July 2021 times.
● Number of instalments : 28 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 22 Chaturvedi).
● Amount of instalment: Rs.7,200,000 May
2015 onward (Rs.6,666,667 till 31 March
2015) {principal 22 instalments}
● Rate of interest : Bank base rate plus 2.25%
per annum.
● Moratorium period : 12 months
11 The South Indian Bank Limited ● Repayment terms: Monthly instalments 533,24,000 733,28,000 (1) Exclusive charge over underlying receivables both present and future of
● Date of maturity :30 November 2018 borrowers with 1.10 times coverage on standard asset portfolio.
● Number of instalments : 60 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 32 Chaturvedi).
● Amount of instalment: Rs. 1,667,000
{principal (31 instalments and last instalment
for Rs. 1,647,000)}
● Rate of interest : Bank base rate plus 2.50%
per annum.
● Moratorium period : 1 month
12 HDFC Bank I ● Repayment terms: Quarterly instalments 560,00,000 720,00,000 (1) Hypothecation against book debts/Loans for which the loan is to be
● Date of maturity :8 July 2019 availed, security cover of 1.10 times on book debts /loans not overdue for
● Number of instalments : 20 Balance more than 30 days
instalments: 14 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: Rs. 4,000,000 Chaturvedi).
(principal)
● Rate of interest : Bank base rate plus 2.70%
per annum.
● Moratorium period : 3 month
13 HDFC Bank II ● Repayment terms: Quarterly instalments 750,00,000 - (1) Hypothecation against book debts/Loans for which the loan is to be 750,00,000
● Date of maturity :19 May 2018 availed, security cover of 1.10 times on book debts /loans not overdue for
● Number of instalments : 12 Balance more than 30 days
instalments: 9 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: Rs. 8,333,333 Chaturvedi).
(principal)
● Rate of interest : Bank base rate plus 2.70%
per annum.
● Moratorium period : 3 month
14 Vijaya Bank ● Repayment terms: Quarterly instalments
● Date of maturity :29 July 2021
● Number of instalments : 24 Balance
instalments: 22
● Amount of instalment: Rs. 4,166,667
(principal)
● Rate of interest : Bank base rate plus 2.25%
per annum.
● Moratorium period : 12 months
916,66,667 1000,00,000 (1) Exclusive charge by way of hypothecation/assignment of specific book
debts created out of Housing assets finance by the company out of term loan or
on the unencumbered book debts which are identified by the company from
time to time covering 1.10 times of term loan. Book debts/Receivable
pertaining to standard regular underlying assets are only eligible as security to
exposure from Vijaya Bank. Book Debts shall be of the principal amount of
the underlying assets. (2)Personal Guarantee of
promoters (Mr. Ajay Oak and Mr. Sanjay Chaturvedi).
15 ICICI Bank ● Repayment terms: Monthly instalments 430,55,556 500,00,000 (1) The list of book debts /loan receivables of clients and accounts (along with
● Date of maturity :31 May 2021 the amount receivable from them) hypothecated to ICICI Bank (minimum of
● Number of instalments : 72 Balance 1.10 times of the facility outstanding)
instalments: 62 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: Rs. 694,444 Chaturvedi).
(principal)
● Rate of interest : Bank base rate plus 2.50%
per annum.
● Moratorium period : 12 month
16 Kotak Mahindra Bank Limited ● Repayment terms: Monthly instalments 533,33,333 933,33,333 (1) Exclusive charge on all the Book Debts of the borrower having minimum 533,33,333
● Date of maturity : 15 July 2017 security cover of 1.11 times.
● Number of instalments : 30 Balance (2) Unconditional and irrevocable Personal Guarantee of promoters (Mr. Ajay
instalments: 16 Oak and Mr. Sanjay Chaturvedi) to the full extent of the loan amount.
● Amount of instalment: Rs. 3,333,333
(principal)
● Rate of interest : Bank base rate plus 2.50%
per annum.
Page 68 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
No. Lender Terms of repayments Loan outstanding as on 31
March 2016
Loan outstanding as on 31
March 2015
Details of security /guarantee
17 Bank of Maharashtra ● Repayment terms: Monthly instalments
● Date of maturity :31 March 2022
● Number of instalments : 78 Balance
instalments: 73
● Amount of instalment: : Rs. 5,770,000
{principal (72 instalments and last instalment
for Rs. 5,710,000)}
● Rate of interest : Bank base rate plus 3.00%
per annum.
● Moratorium period : 6 month
4211,50,000 4500,00,000 (1) Pari passu charge on Hypothecation of Receivables created out of bank
finance with minimum cover of 1.11 times of the outstanding exposure.
(2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
Chaturvedi).
18 Dena Bank ● Repayment terms: Monthly instalments
● Date of maturity :30 March 2022
● Number of instalments : 72 Balance
instalments: 72
● Amount of instalment: : Rs. 1,388,889
{principal (71 instalments and last instalment
for Rs. 1,388,881)
● Rate of interest : Bank base rate plus 2.25%
per annum.
● Moratorium period : 12 month
1000,00,000 1000,00,000 (1) Exclusive charge by way of hypothecation / assignment of specific book
debt created out of housing assets financed by the company out of our term
loan or on the unencumbered book debts which are identified by the company
from time to time covering 1.10 times of our term loan at any point of time
during the currency of the facility.
(2) Personal Guarantees of Promoters (Mr. Ajay Oak and Mr. Sanjay
Chaturvedi).
19 Andhra Bank • Repayment Terms: Monthly instalments
• Date of Maturity: 28 Feb 2023
• Number of instalments: 72 Balance
instalments: 72
• Amount of instalment: Rs. 2,777,778
(principal)
• Rate of Interest: Base Rate+ 2%
+TP(0.50%) per annum.
• Moratorium period: 12 months
2000,00,000 - (1) Exclusive charge by way of hypothecation / assignment of specific book
debt created out of housing assets financed by the company out of bank' term
loan or on the unencumbered book debts which are identified by the company
from time to time covering 1.11 times of bank' loan at any point of time
during the currency of the facility.
(2) Personal Guarantees of Promoters (Mr. Ajay Oak and Mr. Sanjay
Chaturvedi).
20 Oriental Bank Of Commerce • Repayment Terms: Monthly Instalments
• Date of Maturity: 30 June 2023
• Number of instalments: 84 Balance
Instalments: 84
• Amount of instalment: : 2,380,953 {principal
(83 instalments and last instalment for Rs.
2,278,254)}
• Rate of Interest: Base rate plus 2.75% per
annum.
• Moratorium period: 6 months
1998,97,353 - (1) Exclusive first charge over specific loan receivable of the company arising
out of housing loans extended by it out of the term loan availed by the
company from our bank. with value of such receivables being equivalent to
1.10 times of the outstanding (standard) term loan exposure of our bank.
(2) Personal Guarantees of Promoters (Mr. Ajay Oak and Mr. Sanjay
Chaturvedi).
21 Tamilnad Mercantile Bank • Repayment Terms: Monthly Instalment
• Date of Maturity: 21 March 2021
• Number of instalments: 60 Balance
Instalment: 60
• Amount of instalment: Rs. 2,500,000
(principal)
• Rate of Interest: Base rate plus 1.40% per
annum.
• Moratorium period: 6 months
1500,00,000 - (1) Exclusive charge by way of hypothecation of housing loan receivables
created out of bank finance with minimum cover of 1.10 times of the
outstanding exposure. (finance charges and non-performing assets shall be
excluded).
(2) Personal Guarantees of Promoters (Mr. Ajay Oak and Mr. Sanjay
Chaturvedi).
22 State Bank of India • Repayment Terms: Monthly instalment
• Date of Maturity: 30th Sep 2023
• Number of instalments: 84 Balance
Instalment:- 84
• Amount of instalment: Rs. 2,380,000
{principal (83 instalments and last instalment
for Rs. 2,460,000)}
• Rate of Interest: Base rate + 2.70% per
annum.
• Moratorium period: 6 months
• Sanctioned amount: Rs. 200,000,000
• Disbursal amount: Rs. 50,000,000
500,00,000 - (1) Hypothecation of pool of receivables amounting to 1.10 times of loan
value within the stipulated time with irrevocable power of attorney to fall
back in case of default.
(2) Personal Guarantees of Promoters (Mr. Ajay Oak and Mr. Sanjay
Chaturvedi).
23 IDBI Bank Limited • Repayment Terms: Monthly instalments
• Date of Maturity: 2nd Feb, 2023
• Number of instalments: 84 Balance
Instalment: 83
• Amount of instalment:Rs. 3,571,428
{(principal) (82 installment and last
installment Rs. 3,571,459)}
• Rate of Interest: Bank Basr rate plus 2.75%
per annum.
• Moratorium period: 6 months
2964,28,554 - (1) First and exclusive charge by way of hypothecation of receivables as
specified in the deed of hypothecation (including principal, interest,
additional/penal interest, service fee and any other charges that may have
been received by the borrower on the underlying pool) upto 1,10 times of the
loan amount as to maintain the 110% cover at all times.
(2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
Chaturvedi).
Total 26567,90,026 20570,16,569
Page 69 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
Note No. 2.3 (1)(ii): Security and terms of repayment for term loans from other parties
No. Lender Terms of repayments Loan outstanding as on Loan outstanding as on 31 Details of security /guarantee
31 March 2016 March 2015
1 Religare Housing Development ● Repayment terms: Monthly instalments 114,09,692 350,83,918 (1) Mortgage of dwelling units financed. The mortgage of property will be
Finance Corporation Limited ● Date of maturity : 01 November 2018 held by the company on behalf of Religare to the extent of 1.10 times.
(Term loan -I) ● Number of instalments : 61 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 31 Chaturvedi).
● Amount of instalment: : Rs. 435,547
{instalment (31 instalments and last
instalment for Rs. 384,861)}
● Rate of interest : 15.20% per annum.
2 Religare Housing Development ● Repayment terms: Monthly instalments 149,95,328 433,41,587 (1) Mortgage of dwelling units financed. The mortgage of property will be
Finance Corporation Limited ● Date of maturity :01 April 2019 held by the company on behalf of Religare.
(Term loan-II) ● Number of instalments : 60 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 36 Chaturvedi).
● Amount of instalment: : Rs. 506,119
{instalment (31 instalments and last
instalment for Rs. 420,893)}
● Rate of interest : 14.70% per annum.
● Moratorium period : 1 month
3 IFMR Capital Finance Private ● Repayment terms: Monthly instalments 90,52,672 140,97,155 (1) The borrower will provide sufficient book debts to ensure an asset cover 90,52,672
Limited (Term Loan-I) ● Date of maturity :25 September 2017 of 1.00 times on the outstanding facility.
● Number of instalments : 48 Balance (2) Facility shall be secured by creating a first charge on the receivables
instalments: 18 meeting the portfolio origination criteria up to a value of required to meet the
● Amount of instalment: Rs. 562,000 security cover.
(instalment) (3) Cash collateral amounting to Rs. 1,215,400 deposit against borrowings.
● Rate of interest : 14.30% per annum.
4 IFMR Capital Finance Private ● Repayment terms: Monthly instalments 306,29,337 418,19,442 (1) The Facility is secured by a first and exclusive charge over the portfolio 306,29,337
Limited (Term Loan-II) ● Date of maturity : 16 May 2018 (Charged Assets ) created by a deed of hypothecation.
● Number of instalments : 48 Balance (2) The borrower will provide sufficient book debts to ensure an asset cover
instalments: 26 of 1.00 times on the outstanding facility.
● Amount of instalment: Rs. 1,379,000
(instalment)
● Rate of interest : 14.50% per annum.
5 IFMR Capital Finance Private ● Repayment terms: Monthly instalments 306,29,337 418,19,442 (1) The Facility is secured by a first and exclusive charge over the portfolio 306,29,337
Limited (Term Loan-III) ● Date of maturity : 22 May 2018 (Charged Assets) created by a deed of hypothecation.
● Number of instalments : 48 Balance (2) The borrower will provide sufficient book debts to ensure an asset cover
instalments: 26 of 1.00 time on the outstanding facility.
● Amount of instalment: Rs. 1,379,000
(instalment)
● Rate of interest : 14.50% per annum.
6 IFMR Capital Finance Private ● Repayment terms: Monthly instalments 1107,15,805 1300,00,000 (1) The Facility is secured by a first and exclusive charge over the portfolio
Limited (Term Loan-IV) ● Date of maturity :23 March 2020 (Charged Assets) created by a deed of hypothecation.
● Number of instalments : 60 Balance (2) The borrower will provide sufficient book debts to ensure an asset cover
instalments: 48 of 1.00 time on the outstanding facility.
● Amount of instalment: Rs. 3,018,000
(instalment)
● Rate of interest : 13.90% per annum. ●
Moratorium period : Nil
7 IFMR Capital Finance Private ● Repayment terms: Monthly instalments 439,23,821 - (1) The Facility is secured by a first and exclusive charge over the portfolio
Limited (Term Loan-V) ● Date of maturity : 26th May, 2020 (Charged Assets) created by a deed of hypothecation.
● Number of instalments : 60 Balance (2) The borrower will provide sufficient book debts to ensure an asset cover
instalments: 50 of 1.00 time on the outstanding facility.
● Amount of instalment: Rs. 1,161,000
{principal (49 instalments and last instalment
for Rs. 1,225,985)}
● Rate of interest : 13.9% per annum. ●
Moratorium period : Nil
8 IFMR Capital Finance Private ● Repayment terms: Monthly instalments 556,54,979 - (1) The Facility is secured by a first and exclusive charge over the portfolio
Limited (Term Loan-VI) ● Date of maturity : 15th June, 2020 (Charged Assets) created by a deed of hypothecation.
● Number of instalments : 60 Balance (2) The borrower will provide sufficient book debts to ensure an asset cover
instalments: 51 of 1.00 time on the outstanding facility.
● Amount of instalment: Rs. 1,451,000
{principal (50 instalments and last instalment
for Rs. 1,527,056)}
● Rate of interest : 13.9% per annum. ●
Moratorium period : Nil
9 IFMR Capital Finance Private ● Repayment terms: Monthly instalments 941,91,438 - (1) The Facility is secured by a first and exclusive charge over the portfolio
Limited (Term Loan-VII) ● Date of maturity : 19 Oct 2020 (Charged Assets) created by a deed of hypothecation.
● Number of instalments : 60 Balance (2) The borrower will provide sufficient book debts to ensure an asset cover
instalments: 55 of 1.00 time on the outstanding facility.
● Amount of instalment: Rs. 2,345,000
{principal (54 instalments and last instalment
for Rs.2,455,794)}
● Rate of interest : 14.35% per annum. ●
Moratorium period : Nil
10 MAS Capital Financial Services ● Repayment terms: Monthly instalments 260,41,659 385,41,663 (1) Exclusive charge on portfolio created out of this term loan as per selection 260,41,659
Limited (Term Loan- I) ● Date of maturity :30 April 2018 criteria to the extent of 1 times for the loan outstanding.
● Number of instalments : 48 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 25 Chaturvedi).
● Amount of instalment: Rs. 1,441,667 (3) Cash collateral amounting to Rs. 2,500,000 deposit against borrowings.
{principal (24 instalments and last instalment
for Rs. 1,041,651)
● Rate of interest : MAS PLR minus 1.00%
per annum. ● Moratorium period : 3 months
Page 70 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
No. Lender Terms of repayments Loan outstanding as on 31 Loan outstanding as on 31 Details of security /guarantee
March 2016 March 2015
11 MAS Financial Services Limited ● Repayment terms: Monthly instalments 312,49,994 437,49,998 (1) Exclusive charge on portfolio created out of this term loan as per selection 312,49,994
(Term Loan- II) ● Date of maturity :30 April 2018 criteria to the extent of 1 times for the loan outstanding.
● Number of instalments : 48 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 30 Chaturvedi).
● Amount of instalment: Rs. 1,441,667 (3) Cash collateral amounting to Rs. 2,500,000 deposit against borrowings.
{principal (29 instalments and last instalment
for Rs. 1,041,651)
● Rate of interest : MAS PLR minus 1.00%
per annum.
● Moratorium period : 3 months
12 MAS Financial Services Limited ● Repayment terms: Monthly instalments 322,91,661 447,91,665 (1) Exclusive charge on portfolio created out of this term loan as per selection 322,91,661
(Term Loan- III) ● Date of maturity : 10 October 2018 criteria to the extent of 1 times for the loan outstanding.
● Number of instalments : 48 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 31 Chaturvedi).
● Amount of instalment: Rs. 1,441,667 (3) Cash collateral amounting to Rs. 2,500,000 deposit against borrowings.
{principal (30 instalments and last instalment
for Rs. 1,041,651)
● Rate of interest : MAS PLR minus 1.00%
per annum.
13 MAS Financial Services Limited ● Repayment terms: Monthly instalments 649,99,997 - (1) Exclusive charge on portfolio created out of this term loan as per selection 649,99,997
(Term Loan- IV) ● Date of maturity : 10 June 2019 criteria to the extent of 1 times for the loan outstanding.
● Number of instalments : 48 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 39 Chaturvedi).
● Amount of instalment: Rs. 1,441,667 (3) Cash collateral amounting to Rs. 4,000,000 deposit against borrowings.
{principal (38 instalments and last instalment
for Rs. 1,041,651)
● Rate of interest : MAS PLR minus 1.00%
per annum.
14 MAS Financial Services Limited ● Repayment terms: Monthly instalments 1191,66,668 - (1) Exclusive charge on portfolio created out of this term loan as per selection 1191,66,668
(Term Loan- V) ● Date of maturity : 30 Nov 2019 criteria to the extent of 1 times for the loan outstanding.
● Number of instalments : 48 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 44 Chaturvedi).
● Amount of instalment: Rs. 2,708,333 (3) Cash collateral amounting to Rs. 6,500,000 deposit against borrowings.
{principal (43 instalments and last instalment
for Rs. 2,708,349)
● Rate of interest : MAS PLR minus 1.00%
per annum.
15 AU Financiers (India) Limited ● Repayment terms: Monthly instalments 290,64,404 391,66,685 (1) Exclusive hypothecation of present and future home loan of standard
(Term Loan I) ● Date of maturity :23 February 2019 receivable(net of financial charge, NPA's & other charges etc.) as per
● Number of instalments : 60 Balance selection criteria to the extent of 1.10 times for the loan outstanding.
instalments: 35 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: As per repayment Chaturvedi).
schedule (3) Cash collateral amounting to Rs. 2,500,000 deposit against borrowings.
● Rate of interest : 14.10% per annum.
● Moratorium period : 1 month
16 AU Financiers India Limited ● Repayment terms: Monthly instalments 332,30,977 433,33,328 (1) Exclusive hypothecation of present and future home loan of standard
(Term Loan- II) ● Date of maturity :5 July 2019 receivable(net of financial charge, NPA's & other charges etc.) as per
● Number of instalments : 60 Balance selection criteria to the extent of 1.10 times for the loan outstanding.
instalments: 40 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: As per repayment Chaturvedi).
schedule (3) Cash collateral amounting to Rs. 2,500,000 deposit against borrowings.
● Rate of interest : 14.10% per annum.
● Moratorium period : 1 month
17 AU Financiers India Limited ● Repayment terms: Monthly instalments 433,33,328 (1) Exclusive hypothecation of present and future loan receivables as per
(Term Loan- IV) ● Date of maturity : 15 July 2020 selection criteria of AU Financiers India Limited to the extent of 1.10 times
● Number of instalments : 60 Balance for the loan outstanding on the basis of Secured Home loans.
instalments: 52 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: : Rs. 833,334 Chaturvedi).
{principal (51 instalments and last instalment
for Rs. 833,294)
● Rate of interest : 14.50% per annum. ●
Moratorium period : Nil
18 AU Financiers India Limited ● Repayment terms: Monthly instalments 1350,00,000 (1) Exclusive hypothecation of present and future loan receivables as per
(Term Loan- V) ● Date of maturity : 5 Sep 2020 selection criteria of AU Financiers India Limited to the extent of 1.10 times
● Number of instalments : 60 Balance for the loan outstanding on the basis of Secured Home loans.
instalments: 54 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: Rs. 2,500,000 Chaturvedi).
● Rate of interest : 15% per annum.
● Moratorium period : Nil
19 AU Financiers India Limited ● Repayment terms: Monthly instalments 1000,00,000 - (1) Exclusive hypothecation of present and future loan receivables as per
(Term Loan- VI) ● Date of maturity : 05 April 2021 selection criteria of AU Financiers India Limited to the extent of 1.05 times
● Number of instalments : 60 Balance for the loan outstanding on the basis of Secured Home loans.
instalments: 59 (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Amount of instalment: Rs. 2,800,000 Chaturvedi).
● Rate of interest : 13.75% per annum.
● Moratorium period : Nil
20 Hinduja Leyland Finance ● Repayment terms: Monthly instalments
Limited (Term Loan I) ● Date of maturity : 7 July 2019
● Number of instalments : 60 Balance
instalments: 40
● Amount of instalment: Rs. 2,289,650
(instalment)
● Rate of interest : 14% XIRR per annum.
736,79,173 901,61,015 (1) Exclusive first charge (floating) on portfolio of receivables as acceptable
to Hinduja Leyland Finance Limited from time to time covering 1.00 time of the
principal at any point of time during the currency of the facility.
Page 71 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
No. Lender Terms of repayments Loan outstanding as on 31 Loan outstanding as on 31 Details of security /guarantee
March 2016 March 2015
21 Hinduja Leyland Finance ● Repayment terms: Monthly instalments
Limited (Term Loan II) ● Date of maturity : 07 February 2020
● Number of instalments : 60 Balance
instalments: 47
● Amount of instalment: Rs. 2,297,700
(instalment)
● Rate of interest : 14% XIRR per annum.
839,76,331 993,26,820 (1) Exclusive first charge (floating) on portfolio of receivables as acceptable
to Hinduja Leyland Finance Limited from time to time covering 1.10 times of the
principal at any point of time during the currency of the facility.
22 Sundaram BNP Paribas Home ● Repayment terms: Monthly instalments 437,50,000 500,00,000 (1) Exclusive first charge on the existing standard asset portfolio of
Finance Limited (I) ● Date of maturity :01 April 2023 company's housing loan and asset cover should be maintained at 1.10 times.
● Number of instalments : 96 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 84 Chaturvedi).
● Amount of instalment: Rs. 520,833
(principal)
● Rate of interest : Sundaram PLR minus
2.85% i.e., 12.75% per annum.
● Moratorium period : Nil
23 Sundaram BNP Paribas Home ● Repayment terms: Monthly Instalments 477,27,273 - (1) Exclusive first charge on the existing standard asset portfolio of
Finance Limited (II) ● Date of maturity : 1 April 2013 company's housing loan and asset cover should be maintained at 1.10 times.
● Number of instalments : 88 Balance (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
instalments: 84 Chaturvedi).
● Amount of instalment: Rs. 568,182
● Rate of interest : 12.30% per annum.
● Moratorium period : Nil
24 Reliance Capital Limited ● Repayment terms: Quarterly instalments 833,30,856 - 1. Exclusive first charge (floating) on portfolio of receivables including 833,30,856
● Date of maturity : 15 Sep 2018 underlying security interests as acceptable to bank, from time to time
● Number of instalments : 12 Balance covering 1.10 times of the principal at any point of time during the currency
instalments: 10 of the facility.
● Amount of instalment: Rs. 8,333,323
{principal (9 instalments and last instalment
for Rs.8,293,295)}
● Rate of interest : 13.50% per annum. ●
Moratorium period : Nil
25 Capital First Limited ● Repayment terms: Quarterly instalments 2500,00,000 - 1.First exclusive charge (floating) over loan receivables of the borrower to
● Date of maturity : 23 Sep 2023 provide a security (Principal amount) cover of 1.10 time of the facility
● Number of instalments : 30 Balance outstanding and over-dues if any at all times.
instalments: 30
● Amount of instalment: Rs. 8,333,333
● Rate of interest : 14.50% per annum.
● Moratorium period : Nil
26 HDFC Limited ● Repayment terms: Monthly instalments 963,61,501 - (1) First and exclusive charge, by way of deed of hypothecation in favor of
● Date of maturity : 31st Dec 2020 HDFC on book debts/receivables to be received from existing and
● Number of instalments : 60 Balance prospective customers of your company, who have availed/will be availing
instalments: 57 loans form your company, by way of onward lending of this loan facility from
● Amount of instalment: Rs. 2,262,531 HDFC to the extent of 1.10 times the loan amount.
(instalment) (2) Personal Guarantee of Promoters (Mr. Ajay Oak and Mr. Sanjay
● Rate of interest : 12.75% per annum. Chaturvedi).
● Moratorium period : Nil
Total 16944,06,231 7552,32,718
Note No. 2.3 (2): Security and terms of repayment for other loans from National Housing Bank
No. Lender Terms of repayments Loan outstanding as on 31
March 2016
Loan outstanding as on 31
March 2015
Details of security /guarantee
1 National Housing Bank ● Repayment terms: Quarterly instalments
● Date of maturity :1 January 2025
● Number of instalments : 39 Balance
instalments: 33
● Amount of instalment: Rs. 1,300,000
{principal (32 instalments and last instalment
for Rs. 500,000)
● Rate of interest : 9.45% per annum.
● Moratorium period : 2 month
434,00,000 500,00,000 (1) Exclusive first charge by way of hypothecation in the book debts financed
out of refinance assistance together with securities thereof.
(2) Additionally, first exclusive mortgage/ hypothecation of the portfolio to
the extent of 25% of the amount stated above in point (1), thus total coverage
available would be to the extent of 1.25 times of the amount refinanced.
(3) Irrevocable and unconditional guarantee to the extent of Rs. 200,000,000.
Total 434,00,000 500,00,000
Note No. 2.3 (3): Unsecured Redeemable Non Convertible Debentures
No. Particular Terms of repayments As at 31 March 2016 As at 31 March 2015 Remark
1 200 Non Convertible Debenture
of Rs. 1,000,000 each
Date of allotment: 28 March 2016
First redemption: 15 April 2022
Rate of Interest: 13%
2000,00,000 - 1.Unsecured
2. Bullet payment on 15 April 2022
3. Gross Non Performing Assets should be less than 5%
4. Off balance sheet portfolio to total assets ratio should be 35% or less
Total 2000,00,000 -
Page 72 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
Long-term Short-term
As at As at As at As at
31 March 2016 31 March 2015 31 March 2016 31 March 2015
2.4 Provisions
Provision for employee benefits
- Gratuity (refer to note 2.4.1) 9,54,023 3,11,418 1,91,529 1,41,350
- Compensated absences (refer to note 2.4.1) 39,33,769 23,92,883 21,08,546 11,21,116
Other provisions (refer to note 2.11.1)
Housing loans:
Contingent provision against standard assets 144,29,873 118,30,442 12,91,497 9,58,322
Provision for non-performing assets 300,36,805 233,07,328 46,20,002 27,00,840
Non housing loans:
Contingent provision against standard assets 79,93,620 27,17,113 7,72,946 2,50,922
Provision for non-performing assets 21,59,185 21,96,549 3,63,451 1,57,452
Provision for income-tax - - 56,972 -
(net of advance tax and tax deducted at source amounting to
Rs.19,729,849 and MAT credit utilised amouting to Rs. 1,510,820)
595,07,275 427,55,733 94,04,943 53,30,002
2.4.1 Employee benefits
The following table sets out the disclosures as required under AS-15 (revised), “Employee Benefits” as at 31 March 2016 and as at 31 March 2015:
a) Defined Contribution Plan: For the year ended For the year ended
31 March 2016 31 March 2015
Contribution to Provident Fund 122,91,811 82,47,108
Contribution to Employee State Insurance 20,76,726 20,93,581
Contribution to Labour Welfare Fund 52,354 15,220
144,20,891 103,55,909
(Also refer to note 2.20)
b) Defined benefit plan:
i) General description of defined benefit plan:
Gratuity Plan
The Company operates gratuity plan wherein every employee is entitled to the benefit equivalent to 15 days (for a month of 26 days) of total basic salary last drawn for each
completed year of service. Gratuity is payable to all eligible employees of the Company on retirement, separation, death or permanent disablement, in terms of the provisions of the Payment
of Gratuity Act, 1972 with a maximum ceiling of Rs. 1,000,000.
ii. The changes in the present value of obligation representing reconciliation of opening and closing balances thereof are as follows:
As at As at
31 March 2016 31 March 2015
Present value of obligation as at the beginning of the year 19,50,266 14,07,294
Interest cost 1,50,367 1,26,412
Current service cost 10,18,432 12,88,889
Actuarial (gain)/ loss on obligation 1,25,491 (8,72,329)
Present value of obligation as at the end of year 32,44,556 19,50,266
iii. The change in fair value of plan assets:
As at As at
31 March 2016 31 March 2015
Fair value of plan assets at the beginning of the year 14,97,498 7,04,567
Expected return on plan assets 1,34,775 95,034
Contributions 4,52,768 7,02,727
Actuarial gain/loss on plan asset 13,963 (4,830)
Fair value of plan assets at the end of the year 20,99,004 14,97,498
Page 73 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
iv. The amounts recognised in Balance Sheet are as follows:
As at As at
31 March 2016 31 March 2015
Present value of obligation as at the end of the year 32,44,556 19,50,266
Funded status (20,99,004) (14,97,498)
Net liability recognised in Balance Sheet 11,45,552 4,52,768
v. The amounts recognised in Statement of Profit and Loss are as follows:
For the year ended For the year ended
31 March 2016 31 March 2015
Current service cost 10,18,432 12,88,889
Interest cost 1,50,367 1,26,412
Expected return on plan asset (1,34,775) (95,034)
Net actuarial (gain)/ loss recognised in the year 1,11,528 (8,67,499)
Expenses recognised in the Statement of Profit and Loss 11,45,552 4,52,768
vi. Principal actuarial assumptions at the Balance Sheet date are as follows:
Particulars For the year For the year ended
ended
31 March 2016 31 March 2015
Discount rate 7.75% per annum 8.00% per annum
Salary escalation rate 9.00% per annum 7.00% per annum
Return on assets 9.00% per annum 9.00% per annum
Attrition rate Functional head and above : 5.00% Functional head and above : 10.00%
Executive level: 55% Executive level: 40%
Manager level: 24% Manager level: 20%
Retirement age 60 years 60 years
Morality age IALM (2006-2008) Modified Ult. IALM (2006-2008) Ultimate
Economic assumptions
The principal assumptions are the discount rate and salary growth rate. The discount rate is based upon the prevailing market yield of government bonds as at the Balance Sheet date
for the estimated term of the obligation and the estimates of future salary increases considered taking into account the inflation, seniority, promotion and other relevant factors.
vii. Experience on actuarial gain/ (loss) for Projected benefit obligation (PBO):
Particulars
31 March 2016 31 March 2015 31 March 2014 31 March 2013 31 March 2012
On plan assets (losses)/gain 13,963 (4,830) 21,567 (29,535) -
On plan liability (gain)/losses 4,96,502 (3,14,251) (2,64,397) (2,70,771) 40,369
viii. General description of other long term benefit plan:
Compensated absences plan
The Company operates compensated absences plan, where in every employee is entitled to the benefit equivalent to 21 days leave salary for every completed year of service subject to
maximum 42 accumulation of leaves. The salary for calculation of earned leave is last drawn salary. The same is payable during the service, early retirement, withdrawal of scheme,
resignation by employee and upon death of employee.
An actuarial valuation of compensated absences has been carried out by an independent actuary on the basis of the following assumptions:
Assumptions For the year ended For the year ended
31 March 2016 31 March 2015
Discount rate 7.75% per annum 8.00% per annum
Salary escalation rate 9.00% per annum 7.00% per annum
The defined benefit obligation of compensated absences in respect of employees of the Company as at 31 March 2016 amounts to Rs. 6,042,315 (previous year Rs. 3,513,999).
Further the same has been classified into non-current portion amounting to Rs. 3,933,769 (previous year Rs. 2,392,883) and current portion amounting to Rs. 2,108,546 (prev ious
year Rs. 1,121,116).
Page 74 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
As at As at
31 March 2016 31 March 2015
2.5 Short-term borrowings
Secured
Overdraft facilities with scheduled banks* - -
Working capital loan from other parties# - 1000,00,000
Unsecured
Commercial Papers ## 1000,00,000 -
1000,00,000 1000,00,000
*The overdraft facilities with Schedules Banks are secured against the fixed deposits maintained with bank. Also refer to note 2.15
# During the previous year the company has taken a working capital loan, which carries an interest rate of 12.50% per annum and is repaid on 9 June 2015. Loan is secured by the way of
hypothecation of book debts and personnel guarantees of the promoters.
## Detail of repayment, interest rate and installment due for the year ended 31 March 2016:
Particular Date of issue Date of redemption Rate of Interest As at 31 March 2016 As at 31 March 2015
Commercial Paper 21-Sep-15 19-Sep-16 13% 1000,00,000 -
Note:- Discounted value of above Commercial paper is Rs. 88,523,500
As at As at
2.6 Trade payables ** 31 March 2016 31 March 2015
Trade payables
- Total outstanding due of micro and small enterprises 1,29,667 -
- Total outstanding due of creditors other than micro and small enterprises 221,29,561 124,17,357
222,59,228 124,17,357
**The Company had sought confirmation from its vendors on their status under Micro, Small and Medium Enterprises Development Act, 2006 ('MSMED Act') which came into force from
2 October 2006. Based on the confirmations received till date, the disclosure as required by Section 22 of the MSMED Act are given below:-
Particulars As at As at
31 March 2016 31 March 2015
Principal amount remaining unpaid to supplier as at the end of the year 1,29,667 -
Interest due on the principal remaining outstanding as at the end of the year - -
Interest paid under the MSMED Act beyond the appointed day during the year - -
Interest due and payable for the period of delay in making payment (which have been paid but - -
beyond the appointed day during the year) but without adding the interest specified under the
MSMED Act
Interest accrued and remaining unpaid at the end of the year - -
Amount of further interest remaining due and payable even in the succeeding years, until such date - -
when the interest dues as above are actually paid to the small enterprise, for the purpose of
disallowance as a deductible expenditure under the MSMED Act
As at As at
31 March 2016 31 March 2015
2.7 Other current liabilities
Current portion of long term borrowings (refer to note 2.3)
- From banks 5912,03,874 3792,89,299
- From other parties 3885,08,617 1583,63,360
- National Housing Bank 52,00,000 39,00,000
Loans pending disbursement 2665,82,891 3013,41,638
Employee benefits payable 230,65,186 50,89,887
Statutory dues payable 84,78,063 58,97,294
Interest accrued but not due
-on term loan from bank 167,48,270 81,40,475
-on term loan from other parties 64,12,318 45,34,796
-on refinance from National Housing Bank 9,75,632 -
-on Non Convertible Debentures 2,13,115 -
Amount payable under securitisation 38,44,086 7,10,902
Amount payable under assignment 64,08,078 -
Payable for capital goods 67,75,341 -
13244,15,471 8672,67,651
Page 75 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
2.8 Fixed Assets
For the year ended 31 March 2016
Description
Gross block Accumulated depreciation Net block
As at 1 April
2015
Additions during
the year
Deletions during
the year
As at 31 March
2016
As at 1 April
2015
For the year On deletions As at 31 March
2016
As at 31 March
2016
Tangible fixed assets
Computer
Furniture and fixtures
Office equipment
Intangible fixed assets
Software
148,75,467
69,56,361
51,61,898
1,31,429
79,70,900
15,60,908
19,16,153
1,20,657
51,566
70,810
81,130
-
227,94,801
84,46,459
69,96,921
2,52,086
67,35,522
31,56,232
22,09,587
29,699
47,46,724
12,36,170
19,34,768
47,284
44,040
41,870
64,601
-
114,38,206
43,50,532
40,79,754
76,983
113,56,595
40,95,927
29,17,167
1,75,103
Total 271,25,155 115,68,618 2,03,506 384,90,267 121,31,040 79,64,946 1,50,511 199,45,475 185,44,792
For the year ended 31 March 2015
Description
Gross block Accumulated depreciation Net block
As at 1 April
2014
Additions during
the year
Deletions during
the year
As at 31 March
2015
As at 1 April
2014
For the year On deletions As at 31 March
2015
As at 31 March
2015
Tangible fixed assets
Computer
Furniture and fixtures
Office equipment
Intangible fixed assets*
Software
71,90,659
45,71,217
24,07,851
-
76,84,808
23,85,144
28,09,935
1,31,429
-
-
55,888
-
148,75,467
69,56,361
51,61,898
1,31,429
27,19,362
16,42,621
5,23,151
-
40,16,160
15,13,611
17,10,737
29,699
-
-
24,301
-
67,35,522
31,56,232
22,09,587
29,699
81,39,945
38,00,129
29,52,311
1,01,730
Total 141,69,727 130,11,316 55,888 271,25,155 48,85,134 72,70,207 24,301 121,31,040 149,94,115 * Regrouped during the current year from computer
Page 76 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
As at As at
31 March 2016 31 March 2015
2.9 Non-current investments
Investment in Mutual fund (valued at cost) un-quoted - 5,00,000
{Nil (previous year 50,000) units of Canara Robeco Capital Protection Oriented Fund- Series 2 (Plan A)}
- 5,00,000
Aggregate book value of un-quoted investment is Rs. Nil (previous year Rs. 500,000)
2.10 Deferred tax asset (net)# As at As at
31 March 2016 31 March 2015
Deferred tax asset
Provision against
Housing Loans:
Contingent provision against standard assets 51,97,957 41,49,315
Provision for non-performing assets 114,58,580 84,38,350
Non Housing Loans:
Contingent provision against standard assets 28,98,490 9,62,979
Provision for non-performing assets 8,34,059 7,63,756
Provision for gratuity 3,78,754 1,46,901
Provision for compensated absences 19,97,770 11,40,117
Provision for bonus 37,60,290 -
Employee stock option compensation expenses 48,36,203 -
Provision for bad and doubtful assets 6,63,275 1,29,542
Unabsorbed business loss and depreciation under Income-tax Act, 1961 - 77,30,061
Less: Deferred tax liability
Difference between written down value of fixed assets as per Companies Act, 2013 and Income-tax (1,40,347) (15,225)
Act, 1961
Un-amortised processing fees on borrowings (refer note 1B(f)) (188,23,077) (114,99,170)
Special reserve u/s 36(1)(viii) of The Income-tax Act, 1961 (36,96,974) -
93,64,980 119,46,626
# In the previous year, deferred tax asset was not recorded by the Company on the timing differences as the Company believed that there was no virtual certainty that they will
generate sufficient future taxable income to realize such deferred tax assets except to the extent of Rs. 11,514,395 corresponding to which there existed reversible temporary
differences for set off.
Non-current portion Current portion*
As at As at As at As at
31 March 2016 31 March 2015 31 March 2016 31 March 2015
2.11 Long term loans and advances (refer note 2.11.4)
(Unsecured, considered good unless stated otherwise)
To parties other than related parties
Housing loans - secured
Individuals
- Considered good 35400,14,669 29671,29,407 2574,50,240 1998,71,919
- Considered doubtful 300,44,355 232,91,294 46,12,452 26,51,060
Housing loans - unsecured
Individuals
- Considered good 62,69,445 82,89,811 7,03,750 12,03,463
- Considered doubtful - 16,034 - 49,780
Non Housing loans - secured
Individuals
- Considered good 19525,37,910 6891,87,352 1531,41,157 531,06,715
- Considered doubtful 21,59,185 21,96,549 3,63,451 1,57,453
Non Housing loans - unsecured
Individuals
- Considered good 2,304 44,195 52,845 1,37,549
- Considered doubtful - - - -
Minimum retention requirement (against securitization transaction) 230,18,612 230,18,612 - -
(also refer note 2.11.2)
Minimum retention requirement (against assignment transaction) 330,68,950 - 18,87,424 -
(also refer note 2.11.3)
Security deposits 101,35,771 57,12,668 78,20,670 34,93,892
Advances to suppliers for capital assets 16,58,956 4,88,190 - -
Cash collateral against borrowings 242,15,400 137,15,400 - 6,03,171
Advance tax and tax deducted at source - 9,83,588 - -
(net of provision for tax for previous year Rs. 5,005,134)
Minimum alternative tax (MAT) recoverable - 50,05,134 34,94,314 -
56231,25,557 37390,78,234 4295,26,303 2612,75,002
* Amount disclosed under " Short-term loans and
advances"
Page 77 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited) Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
2.11.1 Classification of loans and advances and provisions thereon
(in accordance with the directions issued by the NHB in terms of The Housing Finance Companies (NHB) Directions, 2010)
As at 31 March 2016
Loans and advances Provisions
Particulars Housing loans Non Housing loans Housing loans Non Housing loans
Individuals Individuals Individuals Individuals
Standard assets 37223,88,304 21012,58,350 157,21,371 87,66,566
Sub standard assets 585,61,714 51,31,483 99,55,059 7,70,176
Doubtful assets 581,44,894 1,94,763 247,01,748 77,905
Doubtful assets-II - 16,72,258 - 16,74,555
Loss assets - - - -
38390,94,912 21082,56,854 503,78,178 112,89,202
As at 31 March 2015
Loans and advances Provisions
Particulars Housing loans Non Housing loans Housing loans Non Housing loans
Individuals Individuals Individuals Individuals
Standard assets 30541,82,075 7319,58,171 127,88,764 29,68,034
Sub standard assets 1381,78,307 111,78,621 219,51,214 16,76,792
Doubtful assets 101,42,385 16,93,022 40,56,954 6,77,209
Loss assets - - - -
32025,02,767 7448,29,814 387,96,932 53,22,035
2.11.2 Securitized assets are derecognised in the books of the Company based on the principle of transfer of ownership interest over the assets. De-recognition of gain or loss arising
on such securitisation is based on the guidance note on Accounting for Securitisation issued by the Institute of Chartered Accountants of India.
During the year ended 31 March 2014, the Company on 27 March 2014 and on 31 March 2014 has securitised portion of its loan portfolio amounting to Rs.165,347,839 and Rs.
108,063,819 respectively at par. Pursuant to the said securitisation arrangements, the Company has derecognised such loan ass ets from its books of account. Also, in
accordance with the terms and conditions of the securitisation agreements, the Company has retained loan assets amounting to Rs. 23,018,612 as minimum retention
requirement (‘MRR’) and has also given cash collateral in the form of fixed deposits amounting to Rs. 8,456,249. MRR has been disclosed under note 2.11 and fixed deposits have
been disclosed under note 2.15 of the financial statements. Further, the Company will continue to act on a non-recourse basis to collect and service the monthly EMI collection
on the said securitised portfolio. In lieu of rendering the aforesaid services, the Company will charge 0.1% of the total collections for the respective month (the charging of fees
is applicable only for the securitisation agreement pertaining to Rs. 165,347,839 portfolio).
Nature of transaction Date of Transaction Minimum retention Pool Outstanding Pool Outstanding
requirement (MRR) As at 31 March 2016 As at 31 March 2015
Securitization transaction 1 27-Mar-14 165,34,784 945,24,010 1222,12,173
Securitization transaction 2 31-Mar-14 64,83,829 654,52,686 853,92,885
2.11.3 Assigned assets are derecognised in the books of the Company based on the principle of transfer of ownership interest over the Assets. De-recognition of gain or loss arising on
such direct assignment is based on the guidance note on Accounting for Securitisation issued by the Institute of Chartered Accountants of India.
During the year ended 31 March 2016, the Company on 29 June 2016 has assigned portion of its loan portfolio amounting to Rs. 441,980,568 at par. Pursuant to the said
assignment arrangements, the Company has derecognised such loan assets from its books of account. Also, in accordance with the terms and conditions of the assignment
agreements, the Company has retained loan assets amounting to Rs. 44,198,057 as minimum retention requirement (‘MRR’). MRR has been disclosed under note 2.11. Further,
the Company will continue to act on a non-recourse basis to collect and service the monthly EMI collection on the said assigned portfolio. In lieu of rendering the aforesaid
services, the Company will charge 0.05% of the total outstanding at beginning of respective month.
Nature of transaction Date of Transaction Minimum retention Pool Outstanding Pool Outstanding
requirement (MRR) As at 31 March 2016 As at 31 March 2015
Direct assignment 29-Jun-15 441,98,057 3438,78,949 Nil
2.11.4 Loans to borrowers are secured by:
a) Equitable mortgage of property and/or
b) Undertaking to create a security by way of equitable mortgage of property.
Page 78 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
As at As at
31 March 2016 31 March 2015
2.12 Other non-current assets
(Unsecured, considered good)
Fixed deposits (due to mature after 12 months from the reporting date) (refer note 2.15) 200,00,000 230,00,000
Unamortised processing fees on borrowings (refer note 1B(f)) 433,83,907 276,49,921
633,83,907 506,49,921
2.13 Current investments As at As at
31 March 2016 31 March 2015
Investment in mutual funds un-quoted
50,000 (previous year Nil) units of Canara Robeco Capital Protection Oriented Fund- Series 2 (Plan A) 5,00,000 -
Aggregate book value of un-quoted investment is Rs. 500,000 (previous year Rs. Nil)
5,00,000 -
2.14 Trade receivables
(Outstanding not exceeding six months)
Secured
- Considered good 263,55,314 88,49,422
- Considered doubtful - 3,60,822
Less:- Provision for bad and doubtful debts - (3,60,822)
Unsecured
- Considered good 1,23,042 97,756
- Considered doubtful - 38,444
Less:- Provision for bad and doubtful debts - (38,444)
264,78,356 89,47,178
2.15 Cash and bank balances
Cash and cash equivalents
Cash on hand 93,68,654 21,99,131
Cheques in hand 68,74,301 97,29,904
Balances with bank
- on current accounts 1503,22,189 3729,66,013
- on deposit accounts (with original maturity of 3 months or less) 3500,00,000 4650,00,000
Other bank balances
Fixed deposits (with remaining maturity within 12 months from the reporting date) 818,37,283 758,99,250
5984,02,427 9257,94,298
Details of bank balances/ deposits
Fixed deposits with original maturity of 3 months or less included 3500,00,000 4650,00,000
under "Cash and cash equivalents"
Fixed deposits due to mature within 12 months of the reporting date 818,37,283 758,99,250
included under "Other bank balances" #
Fixed deposits due to mature after 12 months of the reporting date 200,00,000 230,00,000
included under "Other non-current assets" #
4518,37,283 5638,99,250
# Fixed deposit with bank are under lien and are not available for free use. The details of the same are as follows:-
Pledge with bank for obtaining bank overdraft facilities 696,00,528 674,43,000
Pledge with bank as Cash Collateral for securitization transactions 92,36,755 84,56,249
For obtaining bank guarantee for National Housing Bank (Refinance) 200,00,000 200,00,000
Deposit against term loans 30,00,000 48,18,571
1018,37,283 1007,17,820
Page 79 of 89
Shubham Housing Development Finance Company Limited
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
As at As at
31 March 2016 31 March 2015
2.16 Short term loans and advances
(Unsecured, considered good unless stated otherwise)
To parties other than related parties
Housing loans - secured
-Considered good 2574,50,240 1998,71,919
-Considered doubtful 46,12,452 26,51,060
Housing loans - unsecured
-Considered good 7,03,750 12,03,463
-Considered doubtful - 49,780
Non Housing loans - secured
-Considered good 1531,41,157 531,06,715
-Considered doubtful 3,63,451 1,57,453
Non Housing loans - unsecured
-Considered good 52,845 1,37,549
-Considered doubtful - -
Minimum retention requirement (against assignment transaction) 18,87,424 -
(also refer note 2.11.3)
Minimum alternative tax (MAT) recoverable 34,94,314 -
Security deposits 78,20,670 34,93,892
Cash collateral against borrowings - 6,03,171
Service tax receivable 15,46,674 11,03,510
Prepaid expenses 20,44,525 11,67,471
Advances to employees 14,19,237 1,11,524
Advances to suppliers 37,87,104 1,90,569
Other advances 39,21,570 -
4422,45,413 2638,48,076
2.17 Other current assets
Stock of acquired properties (held for sale or disposal) 88,27,224 - (Net of provision for dimunition in the value of acquired properties
amounting to Rs. 2,006,093 (previous year Rs. Nil))
Interest accrued but not due on loans 890,08,609 529,27,714
Interest accrued but not due on:
- Fixed deposits 34,22,115 35,13,998
- Cash collateral against borrowings 13,75,003 8,52,397
Unamortised processing fees on borrowings (refer note 1B(f)) 135,47,033 77,92,120
Unamortised discounted cost of Commercial paper 54,22,962 -
1216,02,946 650,86,229
Page 80 of 89
(formerly known as Shubham Housing Development Finance Company Private Limited)
Notes to financial statements for the year ended 31 March 2016
(All amounts are in Indian Rupees)
For the year ended For the year ended
31 March 2016 31 March 2015
2.18 Revenue from operations
Interest on housing and non housing loans 8703,72,524 4174,57,139
Processing fees and other charges 1215,99,715 897,90,110
Excess interest spread on securitization 108,19,278 126,98,066
Income under assignment transaction 183,70,124 -
10211,61,641 5199,45,315
2.19 Other income
Profit on redemption of mutual funds (net) 314,60,865 90,10,160
Interest income on fixed deposits 131,08,875 111,68,104
Dividend income from current investments - 261,66,770
Miscellaneous income 17,72,904 21,62,821
463,42,644 485,07,855
2.20 Employee benefits
Salaries, bonus and allowances 2674,04,616 1600,92,038
Contribution to provident and other funds 144,20,891 103,55,909
Gratuity 11,45,552 4,52,768
Compensated absences 40,63,340 31,27,295
Employee stock option compensation expense 146,27,237 -
Staff welfare 55,55,595 44,54,154
3072,17,231 1784,82,164
2.21 Finance costs
Interest on
- Term loan 4566,97,355 2307,59,278
- Bank overdraft 3,72,929 4,24,812
- Non Convertible Debentures 2,13,115 -
Processing fees on loans (refer note 1B(f)) 103,08,853 47,41,116
Discount on commercial papers 60,53,538 -
4736,45,790 2359,25,206
2.22 Other expenses
Housing Loans:
Contingent provision against standard assets 33,18,691 70,80,699
Provision for non-performing assets 168,43,988 246,07,286
Non Housing Loans:
Contingent provision against standard assets 58,05,949 25,19,619
Provision for non-performing assets 6,86,626 20,99,461
Legal and professional 168,75,617 231,41,539
Information technology support 81,66,480 68,86,360
Customer acquisition cost 365,09,821 136,44,161
Advertisement 112,87,665 8,30,761
Brokerage and commission 8,76,938 4,10,500
Repair and maintenance - others 97,90,329 67,79,298
Travelling and conveyance 93,69,306 69,19,701
Training and development 11,52,383 7,90,400
Printing and stationery 42,46,348 30,54,940
Storage Charges 6,35,465 3,66,166
Electricity 24,38,971 14,96,128
Communication 64,52,840 48,82,676
Office supplies 5,40,035 6,76,362
Postage and courier 51,63,480 37,13,139
Rent ## 290,33,624 217,62,483
Rates and taxes 10,28,823 17,61,040
336,00,755 -
Capital work-in-progress written off - 20,000
Loss on sale of fixed assets 44,596 14,366
Insurance 9,61,557 4,02,722
Donation 4,51,773 2,68,000
Bank charges 20,10,252 15,35,558
Provision for loss on stock of acquired property 20,06,093 3,99,266
14,53,691 3,14,773
2107,52,096 1363,77,404
Note 2.22 (a)- Payment to auditors*
As auditor
- Statutory audit 15,50,000 11,50,000
- Tax audit # 60,000 25,000
- Certification charges 1,95,000 1,20,000
- Outlays 1,33,770 1,48,729
19,38,770 14,43,729
* excluding service tax
# paid to another auditor
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Miscellaneous
## The Company has taken various office premises on operating lease. The office premises are generally rented for a term between 1 to 3 years on a
cancellable basis. Lease payments during the year are charged to Statement of Profit and Loss.
Shubham Housing Development Finance Company Limited
Loan asset written off {Net of provisions no longer required written back amounting to
Rs. 9,106,842 (previous year Rs. Nil)}
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Significant Accounting Policies and Notes forming part of Financial Statements 2. Segment reporting
The Company provides Housing loans and Non-Housing loans and the entire services are governed by same set of risk and returns. Hence, the Company has been considered to have only one primary segment. The said treatment is in accordance with the guiding principles enunciated in the Accounting Standard-17 on Segment Reporting as specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014. The Company provides services only within India and does not have any operations in economic environments with different risks and returns. Hence, it is considered operating in a single geographical segment.
3. Stock Option Plan
During the financial year 2011-12, the Company issued 119,047 equity shares to the Shubham Employees Welfare Trust for granting the options to employees. A resolution was passed in the Board Meeting of the Company dated 31 October 2013 authorizing the Board/ Compensation Committee to issue 119,047 Employee Stock Options to employees. Each option is exercisable for one (1) equity share or security convertible to one (1) equity share of face value of Rs. 10/ - each fully paid up on payment to the Trust for such shares at a price to be determined in accordance with Employee Stock Option Plan 2013 (‘ESOP 2013’). If an Employee Stock Option expires or becomes un-exercisable without having been exercised in full, such options, would be available to the Compensation Committee for granting to other employees.
The Employee Stock Options granted under ESOP 2013 shall vest for a minimum period of one
(1) year and a maximum of four (4) years from the date of grant of the option. The exact period for which the options would vest shall be determined by the Compensation Committee, subject to the aforesaid limits regarding the minimum and maximum vesting period. There shall be a minimum period of one year between the grant of options and vesting of option.
During the year the company has granted 29,529 option to employees under the ESOP 2013, detail is as under:
Date of Grant Date of Vesting No. of Options Fair Value (Rs.)
Exercise price (Rs.)
1 May 2015 1 May 2016 8,065 955.28 10
24Aug 2015 24Aug 2016 3,594 955.32 10
24Aug 2015 24 Feb 2017 1,194 955.64 10
1 May 2015 1 May 2017 4,934 955.87 10
1 May 2015 1 Aug 2017 265 956.00 10
24Aug 2015 24 Feb 2018 2,394 956.23 10 1 May 2015 1 May 2018 3,870 956.34 10
1 May 2015 1 Aug 2018 224 956.47 10
1 May 2015 1 Jan 2019 2,596 956.71 10
24Aug 2015 24 Feb 2019 2,393 956.74 10
Total 29,529 The Activity in the ESOP 2013 during the year ended 31 March 2016 is as follow:
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
Particular Year ended 31 March 2016
Shares arising out of options (Nos.)
Weighted average exercise price (Rs.)
Outstanding at the beginning of the year - -
Granted during the year 29,529 10
Forfeited and expired during the year - -
Exercised during the year - -
Outstanding at the end of the year 29,529 10
Exercisable at the end of the year 29,529 10
The fair value of above options is estimated on the date of grant using the Black-Scholes- Merton model with the following assumptions:
Particular Option Granted during the year
Grant date 1 May 2015 24 August 2015
Weighted Average option price (Rs.) 955.84 955.94 Exercise price (Rs.) 10.00 10.00
Expected volatility (%) 13.95 15.74
Expected life of Option (years) 1 - 7 1 - 7
Expected dividend Nil Nil
Risk-free interest rate (%) 7.90 - 8.03 8.05 - 8.30
Fair value of share on grant date (Rs.) 962.56 962.56
The expected volatility for grant on 1 May 2015 has been calculated based on stock price of BSE 500 for the period 2 May 2014 to 1 May 2015 and for grant on 24 August 2015 has been calculated based on stock price of BSE 500 for the period 22 August 2014 to 25 August 2015.
During the year ended 31 March 2016, the Company recorded an employee compensation
expense of Rs. 14,627,237 in the Statement of Profit and Loss.
4. Commitments As at As at
Particulars 31 March 2016 31 March 2015 Commitments Other commitments- Undisbursed amount of loans sanctioned 427,714,429 722,186,130 Committed amount against capital assets 6,926,833 -
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
5. Earnings per share
Basic and diluted earnings per equity share have been computed by dividing net profit after tax by the weighted average number of equity shares outstanding for the year.
Particulars Units Year ended 31 March 2016
Year ended 31 March 2015
Basic earnings per share
a. Profit after tax attributable to equity shareholders Rs. 55,908,026 10,398,189
Computation of weighted average number of Equity shares of Rs. 10 each
Number of shares at the beginning of the year 943,690 619,187
Number of shares issued during the year - 324,503
Total number of equity shares outstanding at the end of the year
943,690 943,690
Weighted number of equity shares outstanding at the end of the year
943,690 872,960
b. Less: - shares issued ESOP trust (reduced in accordance with paragraph 46 of ‘Guidance Note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India’ in computation of EPS and considered as dilutive potential equity shares)
119,047 119,047
c. Weighted average of number of equity shares used in computing basic earnings per share
824,643 753,913
d. Basic earnings per equity share of face value of Rs. 10 each (a/c)
67.80 13.79
Diluted earnings per share
Computation of weighted average number of CCPS of Rs. 10 each
Number of preference shares at the beginning of the year
2,485,640 1,364,968
Number of preference shares issued during the year
- 1,384,888
Total number of preference shares outstanding at the end of the year
2,485,640 2,485,640
e. Number of potential equity shares arising out of conversion of CCPS.
2,485,640 2,049,569
f. Diluted weighted average number of equity shares outstanding during the year (based on the date of issue of shares) (f=b+c+e)
3,429,330 2,922,529
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
g. Diluted earnings per equity share of face value of Rs. 10 each (a/f)
16.30 3.56
6. Related party transactions Nature of relationship Key management personnel (KMP)
Relative of Key management personnel Entities over which Directors of the Company and their relatives are able to exercise significant influence Shareholders who are able to exercise significant influence
a) Transaction with related parties
Name of the party Mr. Ajay Mukund Oak (Director) Mr. Sanjay Chaturvedi (Director)
Mrs. Rupa Basu (wife of Mr. Ajay Oak)
Shubham Employees’ Welfare Trust Helion Venture Partners II LLC Elevar Equity Mauritius
Description Key management personnel Shareholder who are able to exercise significant influence
For the year ended 31 March 2016
For the year ended 31 March 2015
For the year ended 31 March 2016
For the year ended 31 March 2015
Share capital issued during the year (including security premium)
Helion Venture Partners II LLC
- - - 212,791,596
Elevar Equity Mauritius - - - 212,791,596
Total - - - -
Managerial remuneration
Ajay Mukund Oak 5,620,436 5,209,359 - -
Sanjay Chaturvedi 5,640,376 5,156,019 - -
Relative of Key management personnel
Rupa Basu 3,330,901 - - -
Total 14,591,713 10,365,378 - -
Guarantee given to obtain loan during the year
Ajay Mukund Oak 730,000,000 1,470,000,000 - -
Sanjay Chaturvedi 730,000,000 1,470,000,000 - -
Total 1,460,000,000 2,940,000,000 - -
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
b) Balances outstanding with related parties
Description Key management personnel Shareholder who are able to exercise significant influence
Year ended 31 March 2016
Year ended 31 March 2015
Year ended 31 March 2016
Year ended 31 March 2015
#Guarantee outstanding at year end
Ajay Mukund Oak 1,742,706,273 1,247,512,706 - -
Sanjay Chaturvedi 1,742,706,273 1,247,512,706 - -
Total 3,485,412,546 2,495,025,412 - - #Net of the guarantee released on borrowings repaid during the year. During the year the company has not incurred any expenditure on capital and revenue nature in foreign currency therefore there is no foreign currency liability due on Company as on 31 March 2016.
7. Disclosure pursuant to NHB circular no. NHB/ND/DRS/Pol-No. 35/2010-11 dated 11 October 2010
I Capital to Risk Assets Ratio (CRAR)
Items Year ended 31 March 2016
Year ended 31 March 2015
CRAR (%) 43.94% 58.96% CRAR - Tier I capital (%) 43.32% 58.41%
CRAR - Tier II Capital (%) 0.62% 0.55%
II Exposure to Real Estate Sector
Category Year ended 31 March 2016
Year ended 31 March 2015
A Direct exposure
(i) Residential Mortgages
(a) Individual housing loans up to Rs.15 lakh
3,640,231,392 3,163,593,386
(b) Individual housing loans greater than Rs.15 lakh
273,961,985 90,116,463
(c) Other loans 2,148,645,354 754,880,200
Total 6,062,838,731 4,008,590,049
Lending fully secured by mortgages on residential property that is or will be occupied by the borrower or that is rented;
(ii) Commercial Real Estate - Lending secured by mortgages on
- -
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
commercial real estates (office buildings,
retail space, multipurpose commercial premises, multi-family residential buildings, multi-tenanted commercial premises, industrial or warehouse space, hotels, land acquisition, development and construction, etc.). Exposure would also include non-fund based (NFB) limits;
(iii) Investments in Mortgage Backed Securities (MBS) and other securitised exposures -
(a) Residential - -
(b) Commercial Real Estate - -
B Indirect exposure
(i) Fund based exposures
(a) on National Housing Bank (NHB) - - (b) on Housing Finance Companies
(HFCs) - -
(ii) Non -fund based exposures
(a) on National Housing Bank (NHB) - -
(b) on Housing Finance Companies (HFCs)
- -
Page 87 of 89
SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
III Asset Liability Management: Maturity pattern of certain items of assets and liabilities as at 31 March 2016
Assets and Liabilities are classified in the maturity buckets as per the guidelines issued by National Housing Bank. (amount in crores)
Maturity Buckets
As at 31 March 2016 As at 31 March 2015
Liabilities Assets Liabilities Assets
Borrowings from Banks
Market Borrowings*
Advances** Investments*** Borrowings from Banks
Market Borrowings*
Advances** Investments***
1 day to 30-31 days (One month)
6.31
2.64
3.37
-
4.15
4.60
1.76
-
Over 1 to 2 months 4.06 2.72 2.97 - 1.53 4.61 1.82 -
Over 2 to 3 months 3.81 3.67 2.72 - 1.95 4.62 1.64 -
Over 3 to 6 months 14.66 20.57 8.70 - 8.67 4.04 5.27 - Over 6 months to 1 year 29.45 21.56 19.24 0.05 21.64 8.35 11.62 -
Over 1 to 3 years 99.18 85.13 86.26 - 84.20 36.84 53.15 0.05
Over 3 to 5 years 70.16 43.10 105.91 - 52.68 23.05 63.92 -
Over 5 to 7 years 37.23 23.82 105.56 - 30.89 2.29 65.79 -
Over 7 to 10 years 0.82 0.57 130.92 - - 2.12 77.21 -
Over 10 years - - 125.38 - - - 109.71 -
Total 265.68 203.78 591.03 0.05 205.71 90.52 391.89 0.05 *Market borrowings includes Long-term borrowings from parties other than banks, Non-convertible debentures and Commercial paper. **Advances includes housing and non-housing loans net off provisions for non-performing assets.
***Investment includes investment in mutual funds.
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SHUBHAM HOUSING DEVELOPMENT FINANCE COMPANY LIMITED (Formerly known as Shubham Housing Development Finance Company Private Limited)
Annual Report 2015-16
8. Long-term contracts The Company has a process whereby periodically all long-term contracts are assessed for material foreseeable losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law / accounting standards for material foreseeable losses on such long-term contracts has been made in the books of account.
9. The Company is subject to certain legal proceedings and claims by customers, which have arisen in the ordinary course of business. The Company's management does not expect that these legal actions, when ultimately concluded and determined, will have a material and adverse effect on the Company's results of operations or financial conditions.
10. During the year, the Company has written-off loans amounting to Rs. 33,600,755 (net of provision no longer required written-back amounting to Rs. 9,106,842) pertaining to 54 borrowers as the recovery possibility for these borrowers seems remote, despite legal remedies and other actions taken by the Company.
11. During the year, the Company identified four cases involving disbursement amount of Rs. 3,520,000, wherein post disbursement of loans, the properties were forged/ multiple loans were obtained on same properties by the borrowers. The Company has not been able to recover any amounts back from such loans except for amount of Rs. 113,037. Further, the entire amount outstanding (net of recovery) in books has been written-off (included in note 11 above).
12. Disclosure regarding penalty or adverse comments as per Housing Finance Companies (NHB) Directions, 2010. During the current year ended 31 March 2016:
a. There has been no penalty imposed by National Housing Bank. b. There has been no adverse comments in writing from National Housing Bank on regulatory compliances, which require a specific communication by the Company to the public.
As per our report of even date attached
For B S R & Associates LLP Chartered Accountants Firm registration number: 116231W /W-100024
Manish Gupta Partner Membership No.: 095037 Place: Gurgaon Date: 27 July, 2016
For and on behalf of the Board of Directors of Shubham Housing Development Finance Co. Ltd.
Ajay Mukund Oak Sanjay Chaturvedi Director Director DIN No.: 01779000 DIN No.: 01636432
Neeta Kamra Shashank Jain Company Secretary Chief Financial Officer Place: Gurgaon Date: 27 July 2016
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