sahara housing fina corporation ltd Directors report

DIRECTORS REPORT

Dear Members,

Your company Sahara Housingfina Corporation Limited [hereinafter referred as "the Company"] is a Housing Finance Company registered with the National Housing Bank ("NHB") which is engaged in the business of financing of purchase of residential units as well as construction of houses which includes the development of plots of land for the construction of new houses & redevelopment, expansion & extension of existing houses / flats. Your company is regulated by the Reserve Bank of India ("RBI") and supervised by the National Housing Bank ("NHB").

The Board of Directors of Your Company is pleased to present the 32nd Annual Report on the business and operational performance of the Company along with the Audited Financial Statements for the financial year ended March 31, 2023.

Particulars	2022-23	2021-22
Gross Income	1120.26	1267.00
Less:
- Interest	452.08	487.72
- Overheads	410.69	512.33
- Depreciation	48.79	48.93
Profit Before Tax (PBT)	208.70	218.02
Provision for Taxation
- Current Tax	34.12	61.62
- Deferred Tax	16.71	(20.57)
- Income Tax related to earlier years	16.27	(1.52)
Profit After Tax (PAT)	141.60	178.49
Add: Profit carried from earlier years	2400.91	2277.55
Profit available for appropriations	2542.51	2456.04
Appropriations
Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of the National Housing Bank Act, 1987	27.28	55.13
Balance carried to Balance Sheet	2515.23	2400.91
Total	2515.23	2400.91

Note:

The Company has adopted Indian Accounting Standard (referred to as ‘Ind AS) with effect from April 01,2019 and, accordingly, these financial results along with the comparatives have been prepared in accordance with the recognition and measurement principles stated therein, prescribed under Section 133 of the Companies Act, 2013 read with the relevant rules issued thereunder and the other accounting principles generally accepted in India.

Business Overview

Some of the key highlights of your companys performance during the year under review;

(a) Gross Income

The Gross Income for the year under review was Rs.1120.26 Lakh as against the previous financial years income of Rs.1267.00 Lakh.

(b) Profit (PBT & PAT) & Income

Your Companys Profit Before Tax (PBT) for the current financial year is Rs.208.70 Lakh as compared to Rs.218.02 Lakh in the previous financial year and the Profit After Tax (PAT) for the current financial year is Rs.141.60 Lakh as against 178.49 Lakh in the previous year.

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

• Shareholders Equity (Net Owned Fund) as on March 31,2023 was 4824.05 Lakhs as against Rs.4641.65 Lakhs in the previous year.

•The Total Assets under Management of the Company as on March 31, 2023 was Rs.7866.63 Lakhs as against Rs.9158.49 Lakhs in the previous year.

(d) Transfer to Special Reserve

During the year under review, your company transferred Rs 27.28 Lakhs to the Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of the NHB Act, 1987.

Deferred Tax Liability on the Special Reserve for the year under review has been created in accordance with Clause 101.2 of Chapter XIV of the Master Direction - Non-Banking Financial Company [Housing Finance Company] (Reserve Bank) Directions, 2021 issued by the Reserve Bank of India.

(e) Earnings per Share (EPS)

The Earnings per share (EPS) as on March 31, 2023 was Rs.2.03 as against Rs.2.55 as on March 31,2022.

(f) Share Capital

The paid up equity share capital as on March 31, 2023 was Rs.7.00 Crores, divided into 7,000,000 equity share of face value of Rs 10 each.

i. Issue of Equity Shares with differential Rights/ Buy Back

The Company neither issued equity shares with differential rights during the financial year 202223 nor bought back any of its shares during the year under review.

ii. Issue of Sweat Equity Shares

The Company did not issue any sweat equity shares during the financial year 2022-23.

iii. Issue of Employee Stock Options

The Company did not issue any stock options during the financial year 2022-23.

iv. Provision by company for purchase of its own shares by employees or by trustees for the benefit of employees

The Company does not have a scheme for purchase of its own shares by employees or by any Trustee for the benefit of employees.

(g) Subordinated Debt

Your Company did not raise any fresh money through subordinated debt during the year under review.

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

Your company did not raise fresh money through (Unlisted) Secured Non Convertible Debentures (NCD) during the year under review. As on March 31, 2023, your Companys outstanding secured long time borrowing was Rs.30 Cr. and interest due thereon has been paid. Infomerics Valuation and Rating Pvt. Ltd. has given credit rating of IVR BB-/Stable (IVR double B minus with Stable Outlook)

(i) Material Changes & Commitments occurring after the end of Financial Year

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

(j) Capital Adequacy

As per the Clause 6.1 of Chapter IV of the Master Direction-Non-Banking-Financial Company-Housing Finance Company-(Reserve Bank) Directions, 2021, every Housing Finance Company (HFC) shall maintain a minimum Capital Adequacy Ratio (CAR) of 15 per cent as on March 31, 2022 & thereafter. The Capital Adequacy Ratio of your Company as on March of Year 2023, 2022 and 2021 is set out in the table below:

	As on March 31
Particulars	2023	2022	2021
Capital Adequacy Ratio (%)	106.22	91.10	86.98

(k) Investment in Subsidiaries, Associates and Joint Ventures

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

(l) Lending Performance

During the year under review, the Company disbursed loans aggregating to 1596.19 lakhs as against 1015.49 lakhs in the previous year. The overall outstanding loan portfolio as at March 31,2023 stood at Rs.7866.63 lakhs as against 9158.48 lakhs in the previous year March 31, 2022.

The Cumulative Log-in, Sanction and Disbursement as on March 31, 2023 and 2022 are as under;

Particulars	No. of Accounts		Amount (Rs. in Lakhs)
	2022-23	2021-22	2022-23	2021-22
Cumulative Log-in	6613	6543	72404.98	70606.43
Cumulative Sanction	4417	4352	47822.27	46333.42
Cumulative Disbursement	4268	4194	47753.74	46157.55

(m) Fresh Loans

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

					(Rs. In Lakhs)
Particulars	31.03.23	31.03.22	31.03.21	31.03.20	31.03.19
Sanction	1488.85	1085.76	1292.62	(4072.26)	1678.67
Disbursement	1596.19	1015.49	1272.12	836.03	1585.89

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

(n) Non-Performing Assets and Provisions for Contingency

Your Company strictly adheres to the prudential guidelines for Non-Performing Assets (NPAs) issued by the Master Direction-Non-Banking Financial Company Housing Finance Company-(Reserve Bank of India) under its Directions of 2021, as amended from time to time. As per the prudential norms, the Company did not recognise any income on such NPAs. The Company has made appropriate provision for contingencies on standard as well as non-performing housing loans and other loans as per the norms set by RBI.

The amount of Gross Non-Performing Assets (GNPA) on the Housing Loan portfolio as on March 31, 2023 was Rs.653.88 lakhs against Rs.823.70 lakhs as at March 31, 2022. The Executive Management is taking necessary steps to contain the same within limit.

(o) Dividend

The Board of Directors felt it prudent to retain the earnings for the year under review to be ploughed back in the lending business which shall result in augmenting the Companys growth and consequently shareholders wealth.

(p) Deposits

Your Company has been granted certificate of registration by National Housing Bank, New Delhi as a non-deposit taking Housing Finance Company. In accordance with the said stipulations the Company under the current management has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called. There are no unclaimed deposits as on March 31, 2023.

(q) Particulars of Loans Guarantees or Investments

Since the company is a housing finance Company, the disclosure regarding particulars of loans given, guarantees given and security provided is exempt under the provision of Section 186(11) of the Companies Act, 2013.

As regards investments, there are no investments made by the Company for the year ended March 31, 2023 except short term investment in Fixed Deposit with Nationalised Bank.

(r) Regulatory and Statutory Compliances:

The Company is regulated by the statutory regulators including but not limited to the Ministry of Corporate Affairs, Reserve Bank of India, National Housing Bank, Stock Exchanges and Securities and Exchange Board of India.

All the relevant circulars, notifications, guidelines and Directions issued by the aforesaid statutory regulators were duly placed before the Board of Directors at regular intervals to update the Board members on compliance of the same.

Your Company has adhered to all the applicable circulars, notifications, and guidelines issued from time to time. Your Company is also in compliance with the applicable provisions of the Companies Act, 2013 and rules made thereunder including Secretarial Standards and other applicable statutory requirements

(s) Master Direction-Non-Banking Financial Company-Housing Finance Company (Reserve Bank) Directions, 2021

Your Company is in Compliance with the Master Directions-Non-Banking Financial Company-Housing Finance Company (Reserve Bank) Directions, 2021 and as updated from time to time

(t) Regulations Issued by Securities And Exchange Board of India (SEBI):

Your Company is in Compliance with the applicable circular, notifications and regulations issued by SEBI from time to time including but not limited to SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and SEBI (Prohibition of Insider Trading) Regulations, 2015 as amended from time to time as on the date of this report.

(u) Compliance with Principal Business Criteria

Your Company is adhering to Principal Business Criteria for HFCs as specified under Master Directions-Non-Banking Financial Company-Housing Finance Company (Reserve Bank) Directions, 2021 and as updated from time to time.

(v) Other Regulatory Compliance

The Company has also been following directions, guidelines, circulars issued by SEBI, Stock Exchange (BSE) and MCA from time to time pertaining to listed companies.

In order to prevent frauds in loan cases involving multiple lending from different banks/housing finance companies, the Government of India has set up the Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI) under Section 20 of the SARFAESI Act 2002 to have a central database of all mortgages created by lending institutions. Your Company is registered with CERSAI and the data in respect thereto is being submitted, from time to time.

• Directors and Key Managerial Personnel

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association, Shri Awdhesh Kumar Srivastava, (DIN: 02323304) (Non-Executive & Non-Independent) Director of your Company retires by rotation and is eligible for reappointment at the ensuing Annual General Meeting.

On the recommendations of the Nomination & Remuneration Committee (NRC) and in compliance with the provisions of Regulation 17(1A) of the SEBI (Listing Obligations & disclosure Requirements) Regulations, 2015 (as amended from time to time) the Board of Directors of the company recommended a ‘special resolution, seeking approval of the Members of company, with respect to continuation of the Directorship of Shri Awdhesh Kumar Srivastava, (DIN: 02323304) post his attaining the age of 75 years, as a Non-Independent Director of the Company.

Brief resume of the Director, proposed to be reappointed, nature of his expertise in specific functional areas and name of other companies in which he holds Directorship along with his Membership / Chairmanship of Committees of the Board as stipulated under Regulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirement) Regulation 2015 are provided in the annexure to the Notice of the Thirty-second Annual General Meeting being sent to the members along with the Annual Report.

Based on the confirmations received, none of the Directors are disqualified for being appointed / reappointed as Directors in terms of Section 164 the Companies Act, 2013.

During the year under review, no stock options were issued to the Directors of the Company.

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

Shri D J Bagchi, CEO & Company Secretary, continue to serve your company also as "Manager" under Section 196, 197, 198, and as a Key Managerial Personnel under Section 203 of the Companies Act, 2013 and rules made there under.

Shri Vivek Kapoor continues to serve your company as Chief Financial Officer (CFO) and a Key Managerial Personnel under Section 203 of the Companies Act, 2013.

a) Fit and Proper Declarations given by the Directors

Pursuant to the ‘Fit and Proper Policy adopted by the Company in terms of Chapter IX - Corporate Governance of Master Direction-NonBanking Financial Company-Housing Finance Company (Reserve Bank) Directions, 2021 issued by RBI, the Company has received the requisite declarations and undertaking from all Directors of the Company.

b) Declarations by Independent Directors

All the Independent Directors have submitted the declaration of independence, as required pursuant to provisions of the Section 149(7) of the Act, stating that they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulation and are not disqualified from continuing as Independent Directors of the Company. Further, the Independent Directors have confirmed their registration/exemption on/from Independent Directors Databank. These declarations/confirmations have been placed before the Board

• Board Meetings

The Board during the relevant financial year had met four times on May 28, 2022, August 10, 2022, November 14, 2022 and February 14, 2023 respectively.

• Debenture Trustees:

Catalyst Trusteeship Limited having its registered office at GDA House, Plot No. 85, Bhusari Colony (Right), Kothrud, Pune- 411038

• Registrar and Share Transfer Agent:

Link Intime India Private Limited having its registered office at 247 Park, C 101, 1st Floor, L B S Marg,

Vikhroli (West), Mumbai, Maharashtra-400083 is the Registrar and Share Transfer Agent of the Company.

• Auditors

M/s. B M Chaturvedi & Co. Chartered Accountant (Firm Registration No: 114317W), were appointed as Statutory Auditor of the Company to hold the office with effect from the conclusion of 31st Annual General Meeting (AGM) i.e. held on September 28, 2022 for a period of 5 years till the conclusion of 36th Annual General Meeting (AGM). The appointment is in compliance with the notification issued by Reserve Bank of India (RBI) dated April 27, 2021 on Guidelines for appointment of Statutory Central Auditors (SCAs)/Statutory Auditors(SAs) of Commercial Banks (excluding RRBs), UCBs and NBFCs (including HFCs) (RBI Guidelines).

The Company is in compliance with para 54 of Master Direction on Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 on Rotation of the partners of the Statutory Auditors Firm.

Notes to Accounts and Auditors Report

The Statutory Auditors have not made any adverse comments or given any qualification, reservation, or adverse remarks or disclaimer in their Audit Report on the financial statements of the Company for the Financial Year 2022-2023. Also, the Statutory Auditors have not reported any instances of fraud in the Company committed by officers or employees of the Company to the Audit Committee under Section 143(12) of the Companies Act, 2013.

• Secretarial Audit Report

In accordance with Section 204 of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, Shri P V Subramanian, Practicing Company Secretaries, was appointed as Secretarial Auditors to conduct the Secretarial Audit of the Company for the financial year 2022-23. The Report of Secretarial Auditor is annexed as "Annexure - 2" to this report. The report does not contain any qualification, reservations, adverse remarks or disclosures.

• Directors Responsibility Statement pursuant to Section 134(5) of The Companies Act, 2013

Your Directors would like to inform that the audited accounts for the year ended March 31, 2023 are in conformity with the requirements of the Companies Act, 2013 and they believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Companys financial condition and results of operations.

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

a. that in the preparation of the annual accounts, the applicable accounting standards have been followed and there were no material departures;

b. that appropriate accounting policies have been selected and applied consistently, and Directors have 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 as at March 31, 2023, and of the profit of the Company for that year;

c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. that the annual accounts have been prepared on a ‘going concern basis;

e. that proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively; and

f. that internal financial controls to be followed by the Company have been laid down and that such internal financial controls are adequate and operating effectively.

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

Your Company is not engaged in any manufacturing activity and thus its operations are not energy intensive and the particulars relating to conservation of energy and technology absorption as per Section 134 3) of the Companies Act, 2013, read with Rule

8(3) of the Companies (Accounts) Rules, 2014, are not applicable. There has been no foreign exchange earnings and outgo during the year under review.

• Employee Remuneration

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

• Maintenance of Cost Records

The maintenance of cost records has not been specified by the Central Government under section 148(1) of the Act for the business activities carried out by the Company. Accordingly, paragraph 3(vi) of the Order is not applicable to the Company at present.

• Prevention of Sexual harassment at Work Place

The Company has Zero tolerance towards any action on the part of any executive/staff which may fall under the ambit of ‘Sexual Harassment at workplace, and is fully committed to uphold and maintain the dignity of every women executive/staff working in the company. The following is a summary of Sexual Harassment complaints received and disposed of during the financial year 2022-23;

No. of complaints received: Nil

No. of complaints disposed of: Nil

• Corporate Governance & Management Discussion and Analysis

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

The certificate by Shri P V Subramanian, Practicing whole time Company Secretary, ACS no.4585 (CP: 2077) with regards to compliance with the conditions of Corporate Governance as stipulated in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Annual Report.

• Internal Control

The Company has an adequate internal audit system in place whereby the Internal Audit is conducted by the Internal Auditor and reports are submitted on a periodic basis. The audit function maintains its independence and objectivity while carrying out its assignments. It evaluates on a continuous basis the adequacy and effectiveness of internal control mechanism, adherence to policies, procedures as well as regulatory and legal requirements. The function also recommends improvement in operational processes and suggests streamlining of controls against various risks. The Audit Committee of the Board reviews the internal audit function on a continuous basis.

• Significant/Material Orders Passed by the Regulator or Court or Tribunals

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

There are no proceedings, either filed by the Company or filed against the Company, pending under the Insolvency and Bankruptcy Code, 2016 as amended, before the National Company Law Tribunal or other Courts as at the end of the Financial Year 2022-23.

• Change in the Nature of Business

In the financial year under review, there was no change in the nature of the business of the Company.

• Nomination (Including Boards Diversity) Remuneration & Evaluation Policy

The Policy on Nomination and Remuneration of Directors/ KMP/ Senior Management has been formulated by the Nomination and Remuneration Committee (NRC) and same has been approved by the Board of Directors of the Company. The said policy is for determining qualifications, positive attributes, and independence of a Director, KMP, and Senior Management.

Salient features of the said policy are as follows;

a. Appointment and Removal of Directors, KMP, and Senior Management;

b. Evaluation/ Assessment of Directors/ KMP/ Senior Management;

c. Remuneration to Non-Executive Directors and Executive Directors; and

d. Remuneration to the Key Managerial Personnel and Senior Management

• Related Party Transaction Policy & Transactions

In accordance with the provisions of Section 188 of the Companies Act, 2013 and rules made thereunder; the transactions entered with related parties during the financial year were in the ordinary course of business and on an arms length pricing basis, the details of which are included in the notes forming part of the Financial Statements. Further, during the financial year under review, the Company had not entered into transactions with related parties, which could be considered to be ‘material in accordance with the Related Party Transaction Policy of the Company and therefore, the disclosure of Related Party Transactions as required under Clause (h) of sub-section (3) of Section 134 of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, Form AOC-2 is not applicable to the Company for financial year 2022-23 and hence the same is not provided.

The Related Party Policy is available on the website of the Company at the URL http:// http:// www.saharahousingfina.com/misc/SHCL_Related _Party_Transaction_Policy_Amended_28-May-2022. pdf

Evaluation of Performance of Board, its Committees, and Individual Directors;

In terms of the provisions of the Companies Act, 2013, the Board at its meeting held on February 14, 2023, carried out an annual evaluation on the performance of the Board, that of its committee(s) and individual Directors and expressed its satisfaction as to their performance for the Financial Year 2022-23.

The performance of the committee i.e. Audit Committee, Nomination & Remuneration Committee, Risk Management Committee and Stakeholders Relationship Committee was also evaluated on the basis of its composition, effectiveness in carrying out its mandate, relevance of its recommendations, and allocation of adequate time to fulfil its mandate.

The performance evaluation of the Non-Independent Director and Board Committees and the Board as a whole was also carried out by the Independent Directors at their separate meeting held on February 14, 2023.

The details of evaluation process as carried out and the evaluation criteria and framework have been explained in the Corporate Governance Report, forming part of this Annual Report.

Insurance of Companys Property

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

Risk Management Policy & Asset Liability Management Committee (ALCO)

The company has in place Asset Liability Committee (ALCO) which monitors and on an ongoing basis, liquidity, interest rate and funding risks to which the Company is susceptible. Liquidity risk is caused by an asset-liability mismatch resulting from a difference in the maturity profile of the assets and liabilities. Unexpected increases in the cost of funding an asset portfolio, at the appropriate maturity, and the risk of being unable to liquidate a position in a timely manner at a reasonable price, are some of the triggers of this risk.

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

• Turnaround situation after COVID-19 and its impact

The COVID-19 pandemic has affected the global economy and India is no exception. Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs) have been impacted by the pandemic and its aftermath. Financial Year 20222023 was a challenging year for the financial sector, and the pandemics impact is expected to continue in Financial Year 2023-2024.

In Financial Year 2023-2024 the risks of COVID- 19 that might impact the NBFCs & HFCs are:

The Quality of Asset

The pandemic has affected the ability of borrowers to repay loans, which remains a challenge to asset quality in Financial Year 2022-2023, and the company will continue to keep adequate provisions for bad loans.

The Liquidity

The pandemic has also affected the liquidity of NBFCs and HFCs. Many companies have faced challenges in raising funds from banks and other sources in Financial Year 2023. The liquidity situation is expected to remain tight and evolving in the Financial Year 2024.

Interest Rates

The change in Monetary Policy Committee stance in Financial Year 2023 induced by high inflationary trends resulted in The Reserve Bank of India raising the repo rates by 250 bps through the financial year. Any macro-economic disruptions resulting from the pandemic might affect the profitability of NBFCs and HFCs. If the interest rates remain high in Financial Year 2024, the company might face challenges in maintaining margins.

Economic Recovery

The pace of economic recovery will be a critical factor for NBFCs and HFCs in FY24. If the economy recovers quickly, the company may benefit from the increased demand for credit. However, if the recovery is slow, the demand for credit may remain weak, which could impact the growth prospects.

In summary, aftermath of COVID-19 is expected to have some impact on NBFCs and HFCs in India through FY24. Resultantly, the Company may have to navigate through any consequential challenges on asset quality, liquidity, regulatory environment, interest rates, and economic recovery to maintain its growth and profitability.

Corporate Social Responsibility Policy

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

• Codes, Standards and Policies

(a) Know Your Customer & Anti-Money Laundering Measures

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place, which is strictly adhered to. The said Policy is in line with the Master Direction - Non-Banking-Financial Company Housing Finance Company (Reserve Bank) Directions, 2021.

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

The said policy is available on the website of the Company at the URL http:// www. saharahousingfina.com /misc/ SHCL_ RBI_ KYC_ 13112021.pdf

(b) Fair Practice Code

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organisations policies vis-a-vis client protection. The FPC is being revised and updated to align the same with the improved practices in relation to the dealings of the Company with its customers, and as the Master Direction - NonBanking Financial Company Housing Finance Company (Reserve Bank) Directions, 2021.

The said policy is available on the website of the Company at the URL http://www. saharahousingfina.com/misc/SHCL_RBI_ Fair_Practice_Code_13082021.pdf

(c) Whistle Blower Policy (Vigil Mechanism)

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

The said policy is available on the website of the Company at the URL http://www. saharahousingfina.com/misc/ SHCL_Whistle_ Blower_Policy.pdf

(d) Code of Conduct for Board of Directors and the Senior Management Personnel

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

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

The said policy is available on website of the Company at the URL http://www. saharahousingfina.com/misc/SHCL_ Code_ of_ Conduct_Revised_13-Dec-2019.pdf

(e) Code for Prevention of Insider Trading Practices

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

(f) Policy in Disclosure of Material Events and Information

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

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

(g) Policy on Preservation of Documents and Records

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

(h) Other Policies as Per RBI/NHB Rules/ Guidelines

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

• Listing of Shares of the Company

The Equity Shares of your Company continue to remain listed (Group-X) on the BSE Ltd. The Company has paid the listing fees as payable to the BSE Ltd. for the financial year 2023-24.

• Technology Updation

The Company remains fully committed to implement the "Section-B of the Information Technology Framework" mandated by RBI for HFCs with asset size of below Rs.500 crore and in this direction has already commenced the exercise of upgrading of its existing system and technology. It is expected that with its gradual commissioning, the entire facet of the business i.e. Operations, Credit, Finance & Accounts, Regulatory Report and Returns, MIS etc. shall be system driven with greater efficiency, checks, balance and alerts. While the benefits are significant, the deterrent factor is the huge capital outlay and its recurring maintenance cost that is expected to adversely impact a modest sized HFC as your Company. In order to mitigate it, the process of procurement of hardware / software and onward development work as well as its commissioning are being undertaken in a progressive and stage-wise manner.

• Depository System

The Company has entered into an agreement with CDSL/NSDL for transaction of shares in dematerialized form. As on March 31, 2023, only 2.95 per cent of the Companys paid up Share Capital consisting of 2,06,811 shares were held in physical form. As per the Securities and Exchange Board of Indias (SEBI) instructions, the Companys shares have to be transacted in dematerialised form and therefore, members are requested to convert their holdings to dematerialised form.

• Human Resources and Training

Your company focus to improve human resource as core of everything and strives to ensure overall human resource development and retention thus making them a core participant to the Companys success. Your Companys human resource strategy is centred on cultivation of talent pool of highly empowered individuals, encompassing a diverse mix of young, unconventional talent and seasoned leaders who work collaboratively in an entrepreneurial environment.

Rewarding and recognizing high performing employees are vital to the companys success. The Board values and appreciates the contribution and commitment of the employees towards performance of your Company. Employee relations remained cordial and the work atmosphere remained congenial during the reporting year.

• Go Green Initiatives

Like previous year, the go green initiative to send annual report in electronic format to the shareholders who have registered their e-mail ID with their Depository Participant, shall be continued. The shareholders who have not yet registered their email ID are requested to do so to enable the Company to effectively comply with this initiative.

• Annual Return

Pursuant to Section 92(3) read and Section 134(3)(a) of the Companies Act, 2013, the Annual Return as at 31st March, 2023, is available on the website of the Company at the link: http//www.saharahousingfina.com/ misc/SHCL_MGT-7_AGM-

Draft_-Website pdf

• Acknowledgements

The Directors place on record their sincere appreciation for the assistance and guidance provided by the Reserve Bank of India (RBI), the National Housing Bank (NHB), the Securities and Exchange Board of India (SEBI), the Ministry of Corporate Affairs (MCA), the Registrar of Companies (RoC) and all other government and regulatory authorities for the support and co-operation extended by them from time to time.

The Directors place on record their gratitude for the guidance and support extended by BSE Limited, National Securities Depository Limited (NSDL), Central Depository Services (India) Limited (CDSL) and the Credit Rating Agencies from time to time.

The Directors also place on record their sincere appreciation for the continued support extended by the Bankers, Registrar and Share Transfer Agent (RTA), Debenture Trustee, Channel Partners and other stakeholders and the trust reposed by them in the Company.

Your Directors also wish to place on record their appreciation for the commitment displayed by employees and Senior Management team of the Company for consistent good performance by the Company during the reporting year.

	For and on behalf of the Board of Directors
	(Brijendra Sahay)	(Anshu Roy)
Kolkata	Director	Director
August 14, 2023	(DIN 00017600)	(DIN 05257404)