report on coprorate governance 06-07
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Annual Report 2006-07 DHFL Changing Rules. ChangingLives
REPORT ON CORPORATE GOVERNANCE
Companys philosophy on Code of Governance
The Company considers the compliance with Corporate
Governance as a process towards establishing and maintaining the
principles of integrity, transparency, accountability and fairness and
not a mere adherence to a regulatory framework. The Company has
always practiced Corporate Governance on a voluntary basis rather
thanas an obligation. TheCompanyon a continuousbasis assesses
itsstrengths and weaknesses so as to achieve thebeststandards of
Corporate Governance while on the path of protecting the long terminterest of the shareholders, customers, depositors, creditors and
employees. The Company is conscious of the reputation it carries
amongst its customers and public at large and is continuously
striving to provide good management, to adopt prudent risk
management techniques and to comply with the requiredstandards
of capital adequacy. The Company has implemented the principles
of Corporate Governance in allits dealingsand activitiesandit is fully
supported and endorsed by all the Directors and senior
management personnel so as to sustain a cooperative, competent,
positive, harmonious and productive work atmosphere and
businessorganization.
(Pursuant to Clause 49 of theListing Agreement)
Corporate Governance, has assumed remarkable importance for all the corporate players in India as well as abroad. The Organization for
Economic Co-operation and Development (OECD) hasissued a revisedsetof Corporate Governance Principleswhich areadaptable tovarying
social, legal and economic frameworks in different countries and are considered as widely acceptable global benchmarks of Corporate
Governance. Companies all over theworldhave realized thata vigorous quest of good governance is crucialfor enduringsuccess.
N. R. NarayanaMurthyCommittee on Corporate Governance constitutedby SEBI has observed that, CorporateGovernance is theacceptance
by management of the inalienable rights of the shareholders as the true owners of the corporation and of their own role as trustees on behalf of
the shareholders. It is about commitment to values, about ethical business conduct and about making a distinction between personal and
corporatefunds in themanagementof theCompany.
Companieshave now become conscious of the importanceof pursuinggood Corporate Governance for reaping rich benefits for the Company
and its stakeholders. Corporate Governance is no longer a rigid set of guidelines; it has now become an integral part of the companies
functioning and progress.
The detailed report on Corporate Governance for the financial year ended 31st March, 2007, as per the format prescribed by SEBI and
incorporated inClause49 ofthe Listing Agreementis setout below:
The Board of Directors
Directors of DHFL possess high degree of professional ethics,
integrity and values and are committed to representing the long term
interest of the stakeholders. The basic responsibility of the Board is
to provide effective governance over the Companys affairs
exercising its reasonable business judgment on behalf of the
Company. The Companys business is conducted by its employees
under the direction of the Vice Chairman & Managing Director and
Chief Operating Officer (COO) and the overall supervision of the
Board, to enhance the long term value of the Company for its
stakeholders. Inorder toensureeffectiveness of theBoard,various
powersand responsibilities have been delegatedto the Committees
of theBoardofDirectors.
DHFLs commitment to ethical and lawful business conduct is a
fundamental shared value of the Board of Directors, the Senior
Management and all other employees of the Company. Consistent
with its values and belief, the Company has formulated a
Code of Conduct applicable to the Board and Senior Management.
Further the Company has also adopted code for prevention of
insidertrading.
Composition and size of the Board
As on 31st March, 2007, the Board of Directors comprised of eight
members, including seven non-executive Directors and a Whole-
time Managing Director. The Managing Director is theonly executive
Director on the Board. The goal has been to achieve an optimum
combination of Executive and Non-Executive Directors as well as
independent directors so that the Board is cohesive and has the
expertise for quick and informed decision making. As the Chairman
of the Board is non-executive, the criterion of one-third of the Board
consisting of independent Directors is fulfilled. The Members of
theBoardof Directors aredrawn fromdiverse fields,such as finance,
banking,insurance, administration and economics. Outof thesevennon-executive Directors, five are independent Directors. The
Directors are elected based on their qualification, experience in
varied fields as well as the Companys business needs. Shri Rakesh
Kumar Wadhawan is the Chairman of the Board and Shri Kapil
Wadhawan is the Vice Chairman and Managing Director.
Considering the consistent efforts of Shri Kapil Wadhawan in
transforming DHFL into one of the most influential housing finance
institutions in India, he has been re-designated as Vice-Chairman
andManagingDirectorw.e.f. 25th January, 2007.
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Board Meetings and Attendance
TheBoardof Directors meets atleastoncea quarterto take on record
and approve quarterly/annual financial results and to review the
compliance reports prepared by the Company. Additional meetings
are held asand whennecessary. The Company Secretary prepares
the agenda for the meetings in consultation with the Chairman and
Vice Chairman & Managing Director. The agenda, managementreport and other explanatory notes along withthe performanceof the
subsidiary company are circulated to the directors in advance of the
Board meetings. The members of the Board have full access to the
information and recordsof theCompanyand are free to recommend
any matter for inclusion in the agenda. The senior executives of the
Company are also invited to the Board Meetings for their additional
inputs as when required. A representative of Caledonia Investments
Plc is also invited to attend the Board Meetings as an Investor
Observer.
All the significant activities and transactions of the Company are
regularly notified and reported to the Board. The minutes of all the
CommitteemeetingsarealsoplacedduringeveryBoardMeeting.The
Board is also provided other information as required by the l isting
requirements. An Action Taken Report (ATR) signifying the
compliancesof thedecisions taken intheearlier BoardMeetingbythe
Board is placed at every Board meetingwhich provides the Board an
opportunitytoreviewdecisions/agendaitemsconsideredearlier.
During the year ended 31st March, 2007, the Board met four times.
The meetings were held on 15th May, 2006, 17th July, 2006, 19th
October, 2006and 25th January, 2007.
The attendance of theDirectors in the Board Meetings heldduring
the financial year along with the attendance in the Annual General
Meeting heldon 17th July, 2006is given as follows:
Name of Director Category Number of Attendance at thelast AGM held onBoard meetings
attended 17th July, 2006
Shri Rakesh Kumar Wadhawan Non-Executive 3 No
Shri Kapil Wadhawan Executive Director 4 Yes
Shri Sarang Wadhawan
Shri R.P. Khosla Non-Executive 3 Yes
Shri G. P. Kohli Non-Executive 4 Yes
Shri R. S. Hugar Non-Executive 3 Yes
Shri Ashok Kumar Gupta Non-Executive 4 Yes
Shri Waryam Singh Non-Executive 3 No
Chairman
Vice Chairman & Managing Director
Non-Executive 4 Yes
Directorships&CommitteePositionsheldbytheDirectors
In accordance with the Clause 49 of the Listing Agreement, none of
the Directors is a member inmorethan10 Committees oris acting as
a Chairman of more than 5 Committees across companies in which
he is theDirector. It is to be noted thatClause49 excludes theprivate
limited companies, foreign companies and companies under
Section 25 of the Companies Act, 1956 for the purpose
of considering the limits of the Committees. Also, only the
Chairmanship and membership of the Audit Committee and
ShareholdersGrievances Committee are considered.
The directorships and Committee positions held by the Directors
invarious Companiesaregivenasfollows:
Name of Director Category Number of Directorship No. of CommitteeDirectorship in other companies position held in
other Companies(excluding Directorships inforeign and private companies)
1
Shri Kapil Wadhawan 4
Shri R.P. Khosla Non-Executive 1 - 1
Shri G. P. Kohli Non-Executive 2 1 1
Shri R. S. Hugar Non-Executive 2 1
Shri Ashok Kumar Gupta Non-Executive 3 - 2
6
Shri Waryam Singh Non-Executive 3 1 -
Shri Rakesh Kumar Wadhawan Chairman 4
Vice Chairman & - 1
Managing Director
Shri Sarang Wadhawan Non-Executive - 2
Chairman Member
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Board Committees
As the Board consists of individuals of highly diverse backgrounds
and experience, it is not prudent for the full Board to meet on all
occasions. For this reason, the Company has formed various
Committees of the Board of Directors comprising of Directors with
the appropriate expertise and each Committee is assigned with a
separate specialized task. The formation of the Committees does
away with the necessity of calling a meeting of the full Board at
short intervals. This results in the comprehensive analysis of the
specialized functions by the Committees and the Board can
substantially deliberate on other important items of the business
which demands its direct attention under the law. However, all the
minutesof theCommitteeMeetings are reportedto theBoard so that
allthe Board membersare awareof theCommittees activities.
The Company has four Committees of the Board - Audit
Committee, Remuneration and Compensation Committee,
Shareholders/Investors Grievance Committee and Finance
Committee. The constitution of the committees, appointment of the
members and delegation of the powers to the members of the
committees is decided by the Board. During every Board Meeting,
minutes of all the Committee Meetings held between the two Board
Meetings areplacedfor theperusal of theBoardmembers.
Audit Committee
(a) Termsof Reference
The Audit Committee of the Company is formed primarily to monitor
and supervise the Companys financial reporting process and to
ensure that the disclosure of the financial information is correct,
sufficient and credible in accordance with the provisions of the
Listing Agreement and Section 292A of the Companies Act, 1956. In
addition to this function, the responsibilities of theBoard also include
butare notlimited to thefollowingfunctions:
To oversee the financial reporting process and disclosures of
financialinformation.
To review quarterly/ half yearly and annual financial statements
before submission to the Board with special emphasis on
accounting policies, compliance of Accounting Standards and
otherlegal requirementsrelatingto financialstatements.
To review the findings of the internal investigation and periodic
audit reports.
To hold discussions with the external auditors about the scope of
audit.
To recommend appointment/removal of statutory auditors and
fixingtheir remuneration.
To review all issues which are requiredto be reviewed by theauditcommittee pursuant to the listing agreement with the stock
exchanges and the Companies Act, 1956 with the management
and the internaland external auditors.
To review with the management the financial statements with
reference to anyrelated party transactions.
To review the observations of internal and statutory auditors in
relation to all areas of operation of the Company, including
internalcontrol systems.
To examineall taxation matters, includingrelated legal cases and
the Companys asset/liability managementstrategy (ALCO).
To review the findings of any internal investigation by the internal
auditors into matters where there is suspected fraud or
irregularity or a failure of internal control systems of a material
nature andreportingthe matter to theBoard.
To review with the management the financial statements of the
Subsidiary Companies.
To ensure the independence and objectivity of the independent
auditor.To ascertain the reasons for the defaults in the payment to the
depositors, debenture holders, shareholders and creditors.
Any other terms of reference as may be included from t ime to
timein Clause 49 ofListingAgreement.
The minutes of the meetings of the Committee are placed before
the Board for noting and are also circulated to the members of
theCommittee.
The Audit Committee comprises of three Directors- Shri R. S. Hugar
(Chairman), Shri G. P. Kohli and Shri Ashok Kumar Gupta as
members. All the three members of the Committee are independentdirectors. The members of the Committee have the necessary
expertise in accounting and financial management. The Company
Secretary acts as the Secretary to the Committee. Shri Kapil
Wadhawan, Vice-Chairman & Managing Director of the Company,
theStatutoryAuditors and theInternal Auditor/ Headof InternalAudit
of the Company are invited to attend the audit committee meetings.
The Chairman of the Audit Committee, Shri R. S. Hugar was present
at the Annual General Meeting held on 17th July, 2006 to answer the
queries of the shareholders.
Four meetings of the Audit Committee were held during the year-
on 15th May, 2006, 17th July, 2006, 19th October, 2006 and25th January, 2007. The Vice-Chairman & Managing Director,
Statutory auditors and Head of Internal Audit of the Company are
invitees to the meetings. They undertake the discussion and review
of the quarterly/half-yearly unaudited results, the annual audited
accounts, the annual internal audit plan, matters relating to the
compliance with accounting standards, auditors observations
arising from the audit of the Companys accounts and other related
matters. The attendance of the Directors in the Committee Meetings
isas follows:
(b) Composition
(c) Meetingsand the attendanceduring the year
15th May, 2006 Yes Yes Yes
17th July, 2006 Yes Yes Yes
19th Oct, 2006 Yes Yes Yes
25th Jan, 2007 No Yes Yes
Total Meetings 3 4 4
Attended
Shri R S Hugar Shri G P Kohli Shri Ashok
Kumar Gupta
Date ofMeeting
Attendance of Directors
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Meetings and the attendance during the year
The Finance Committee held 15 meetings during the year. The
attendanceof theDirectorsin the CommitteeMeetings is:
Annual Report 2006-07 DHFL Changing Rules. ChangingLives
The Audit Committee comprises of three independent Directors
who have wide expertise in the field of finance and accounts. The
Committee met four times during the financial year to review the
quarterly results and the annual accounts of the Company.
The Committee reviewed the internal audit programs, financial
reportingsystems,relatedpartytransactionsrecordsandensuredthat
all the accounting transactions are in accordance with the prevailing
regulations. The Committee also reviewed the compliance of the
statements of accounts with accounting standards and Listing
Agreement with the relevant stock exchange. The Committee also
reviewed the accounts and performance of the subsidiary
company on a quarterly basis.
The Committee reviewed the observations made by the internal
and statutory auditors regarding the adequacy of operations
and procedure of internal control. The Committee has found no
discrepancy in the internal control system of the Company.
TheCommittee hasrecommendedto theBoardthereappointmentof
and audit feesto M/s B.M.Chaturvedi& Co.as theStatutoryAuditors
of the Company for the financial year 2007-08.
Report of the Audit Committee for the year ended31st March, 2007
Finance Committee
a) Composition
b) Terms ofReference
The terms of reference of the Finance Committee includes the
following:
Consequent upon the resignation of Shri M. S. Sundara Rajan, UBI
Nominee, the Finance Committee was reconstituted by the Board
of Directors at its meeting held on 15th May, 2006. The Committee
comprises of Shri Rakesh Kumar Wadhawan (Chairman of the
Committee),Shri Kapil Wadhawan and Shri G. P. Kohli.
1) To borrow funds for the purpose of the Companys business in
accordance with section 292 of the Companies Act, 1956 but
not exceeding the overalllimit upto which the Board of Directors
of the Company is authorized/to be authorized under section
293(1)(d) of theCompanies Act,1956.
2) To consider and approve/accept the letters of sanction by
the term lending institutions/banks/NHB and other bodiescorporate, openingand/or closing of the current accounts/cash
credit/overdraft/fixed deposits or other account(s) with any
bank and authorize the Directors/officers of the Company for
thesame.
3) To authorize operation of accounts of the Company with its
bankers and to vary the existing authorization to operate the
same and grantingof general /specific power of attorney to the
officers at the branches for routine matters and any such
matters pertaining to the routinefunctions.
4) To approve the change/s of rates of interest of all loan products
and on public deposits or on debentures, debts or any other
instruments/ financial productsissued by theCompany.
5) To considerand approve the allotment of any issue of securities
by the Company, be it by way of preference shares of all types,
public issue of equity shares including Rights Offer, preferential
issue of equity shares including firm allotment, employees
stock option plan/schemes, bonds, debentures and any other
financial instrument of like nature.
6) To grant approvals of loans upto Rs 30 crore to anyperson, firm
or body corporate at any time or from time to time subject to the
limitsprescribed under the HousingFinanceCompanies (NHB)
Directions, 2001, as maybeapplicable.
Date ofMeeting
Attendance of Directors
10th April 2006 Yes No Yes
22nd May, 2006 Yes No Yes
9th June, 2006 Yes No Yes
16th June, 2006 Yes No Yes
3rd July, 2006 Yes No Yes
24th July, 2006 Yes No Yes
23rd Aug, 2006 Yes No Yes
16th Sep, 2006 Yes No Yes
28th Sep, 2006 Yes No Yes
12th Oct, 2006 Yes No Yes
28th Nov, 2006 Yes Yes Yes
18th Dec, 2006 Yes Yes Yes
1st Mar, 2007 Yes Yes Yes
26th Mar, 2007 Yes No Yes
31st Mar, 2007 Yes No Yes
Total Meetings 15 3 15Attended
Shri Rakesh Shri KapilWadhawan
ShriGPKohliKumar Wadhawan
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Remuneration and Compensation Committee
Termsof reference
CompositionandMeetings
RemunerationPolicy
The terms of reference of the Remuneration and Compensation
Committee includes the recommendation of annual remuneration
and the periodic increments payable to the Executive Director(s)
which is further approved by the Board. The Committee is alsoempowered to recommend to the Board the appointment/
reappointment of the executive/ non-executive Directors, the
induction of Board members into various Committees. The
Committee alsoensures thatthe overallremuneration payable to the
Directors does not exceed the limits prescribed by the Companies
Act, 1956 and is within the limits approved by the shareholders.
The Remuneration Committee was renamed as Remuneration and
CompensationCommittee w.e.f.15th May, 2006 in accordance with
the SEBI (Employee Stock Option Scheme) Guidelines and was
entrusted with the following additionalresponsibilities:
1. Framingof theESOS Scheme
2. Administration of theScheme3. Exercise of controlover theimplementation of the Scheme.
4. Preparation of the Offer Document to disclose the various
detailsof theSchemeto theoption grantees.
5. Appointmentof intermediariesrequiredfor theScheme.
6. Anyother matter relating to administrationof the Scheme.
The Remuneration Committee consists of 3 independent directors
viz., ShriR. S. Hugar, Shri R. P. Khosla and Shri G. P. Kohli. During the
year ended 31st March, 2007, the committee met once on 17th July,
2006whichwas attended by allthe CommitteeMembers.
The compensation of the executive director comprises of a fixed
component and a performance incentive by way of commission.
The compensation is determined based on levels of responsibility
and scales prevailing in the industry. The commission is determined
based on certain pre-agreed performance parameters.
The executive director is not paid sitt ing fees for any
board/committee meetings attendedby him.
The compensation of the non-executive directors takes the form of
commission on profits. Though the shareholders have approved
payment of commission upto 1% of net profits of the Company for
each year calculated as per the provisions of the Companies Act,
1956, the actual commission paid to the directors is restrictedto a fixed sum. This sum is reviewed periodically taking into
consideration various factors such as performance of the Company,
time spent by the director for attending to the affairs and business of
the Company and the extent of responsibilities cast on directors
under general law and other relevant factors. Further, theaggregate
commission paid to all non-executives directors is well within
the limit of 1% of the net profits as approved by the shareholders.
The non-executive director is also paid sitting fees as permitted by
the governing regulations for every board/committee meeting
attended byhim.
The Company currently does not have any stock option
outstandings.
Details of remuneration of Directors for the year ended 31st March
2007are as follows:
Directors Remuneration & Sittings Fees
Shri Rakesh Kumar Wadhawan 1,42,857.00 1,85,000.00
Shri Kapil Wadhawan, 19,44,000.00 9,00,000.00 0.00
Shri R. P. Khosla 1,42,857.00 55,000.00
Shri G. P. Kohli 1,42,857.00 2,50,000.00
Shri R. S. Hugar 1,42,857.00 85,000.00
Shri Ashok Kumar Gupta 1,42,857.00 1,00,000.00
Shri Sarang Wadhawan 1,42,857.00 60,000.00
Shri Waryam Singh 1,42,857.00 65,000.00
Chairman
ViceChairman & Managing Director
Total 19,44,000.00 18,99,999.00 8,00,000.00
Name of Director Salary Commission Sit tings Fees
In accordance with the approval of the shareholders in the Annual
General Meeting held on 25th July, 2005, the Company has entered
into an agreement with the Managing Director for a period of five
years. A notice of atleast three months is required from either of the
party to the agreement for termination. As on 31st March, 2007,
the Company has not granted any Stock Options either to the
Vice-Chairman & Managing Director or to its employees.
Shareholders/ Investors Grievance Committee
Termsof reference
CompositionandMeetings
The Shareholders/ Investors Grievances Committee was
constituted in order to redress the complaints of the shareholders
and investors, related to transfer and transmission of shares, non-
receiptof annual reports,dividends and other share related matters.
The Committee also notes the requests to the Registrar and Share
Transfer Agent made by the shareholders relating to transfer,
transmission, consolidation, and replacement of share certificates,
issue of duplicate certificates and dematerialization of share
certificates. The Committee also reviews the certificates and reports
submitted to the Stock Exchanges under the Listing Agreement/
SEBIRegulations. TheCommittee alsoobserves the quarterly status
of the number of shares in physical as well as dematerialized form.
The Committee also reviews the periodicity and effectiveness of the
share transfer process, statutory certifications, depository related
issues andactivities of theRegistrarandTransferAgent.
The Committee consists of two members: Shri Waryam Singh, an
Independent Director (Chairman of the Committee) and Shri Kapil
Wadhawan, Vice Chairman & Managing Director as the member.
Shri S. Y. Sankhe,Company Secretary is theComplianceOfficer.
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Secretarial Audit
A qualified practicing Company Secretary carried out secretarial
audit of the Company on quarterly basis to reconcile the total
admitted capital with National Securities Depository Limited (NSDL)
and Central Depository Services India Limited (CDSL) and the total
issued and listed capital. The secretarial audit report confirms that
the total issued paid up capital is in agreement with the total number
of shares in physical form and the total number of dematerialized
shares held with NSDL andCDSLand the shares issued from timeto
time werelisted with theStockExchanges.
Risk Management
The Company has established risk assessment and minimization
procedures, which are reviewed by the Board and the Audit
Committee periodically. A detailed report on Risk Management is
included in the reporton ManagementDiscussion andAnalysis.
Code of Conduct
The Company has laid down a Code of Conduct for all Board
members and senior management of the Company. All the Board
members and management personnel have affirmed compliance
with the Code of Conduct. The Code of Conduct is posted on the
websiteof theCompanywww.dhfl.com.
Code for prevention of insider trading practices
In compliance with the Securities and Exchange Board of India
(Prohibition of Insider Trading) Regulations 1997, as amended
till date on Prohibition of Insider Trading, the Company has acomprehensive code of conduct and the same is being strictly
adhered to by its management, staff and relevant business
associates. The code expressly lays down the guidelines and the
procedures to be followed and disclosures to be made, while
dealing with shares of the Company and cautioning them on the
consequences on noncompliance thereof.
TheCompany followsquiet periods (closure of trading window)prior
to the publication of price sensitive information. During the period,
the Company has set up a mechanism where the management and
relevant staffand business associates of the Company are informed
about the sameand areadvisednot to deal in Companys securities.
The Company has formulated a code on Know Your Customer and
Anti-Money Laundering Standards in accordance with the
guidelinesissuedby National HousingBank. Thepolicylays down
Know Your Customer and Anti-MoneyLaundering Standards
Fair Practices Code
The Company has formulated a policy on Fair Practices Code in
accordance with the Guidelines on Fair Practices Code for Housing
Finance Companies (HFCs) issued by National Housing Bank
which is designed to assist both the Company and the consumer
and is applicable to all the products and services offered by the
Branches across the counter, over the phone, by post, through
interactiveelectronicdevices, on the internet orby any other method.The Code specifies various guidelines regarding the strategies
relating to marketing and advertising and to ensure disclosure
and transparency in dealing with the customers. The Code also
proposes the various tactics to be used by the Company during the
process of collection of dues and the various alternatives that are
available to the customers in case the customers are not satisfied
with theservices offered by theCompany.
Details of non-compliance by the Company
During the last three years, there were no strictures or penalties
imposed by either the Securities andExchange Board of India or the
Stock Exchange/s or any statutory authority for non compliance ofanymatterrelatedto thecapital markets.
Re-appointment of Directors
According to the Articles of Association, one-third of the Directors
are liable to retire every year and, if eligible, offer themselves for
re-appointment at every Annual General Meeting. Consequently,
Shri Waryam Singh and Shri G. P. Kohli would retire this year and
beingeligible, offerthemselves for re-appointment.
CEO/ CFO Certification
The CEO and CFO Certification of the financial statements and the
cash flow statement for the year is obtained and was placed before
theBaord.
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the various guidelines which are to be complied by all the Branch
Managers, frontline staff and compliancestaff of the Company while
dealing with the existing as well as new customers. The Code also
specifies the importance of customer education and effective
training to the employees who deal with the customers. The staff is
alsorequiredto keep a vigilant lookon thetransactions of suspicious
nature and cash transactions exceeding the limits specified in the
Code. Shri S. Y. Sankhe, Company Secretary of the Company is
appointed as the Principal Officer to ensure the conformity and
compliance with the Guidelines. All the Branch Managers and other
related staff of the Company dealing with customers have affirmed
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Means of Communication
The main channel of communication with the shareholders is
through the Annual Report which includes Directors Report, Report
on Corporate Governance, Management Discussion and Analysis
and AuditedFinancial Results.
In order to ensure corporate disclosure and reporting requirements,the quarterly/half yearly/annual financial results are generally
published in widely circulated national and local dailies in The
Economic Times in Englishand in MaharashtraTimesin Marathi.
The Company also ensures effective interaction with the
shareholders at the Annual General Meeting. The Directors pay
special attention in answering the various queries raised by the
shareholdersat theAnnualGeneralMeeting.
As required by the Clause 51 of the Listing Agreement, the quarterly,
half-yearly and annual results, annual report and the shareholding
pattern of the Company are regularly filed through Electronic Data
Information Filing and Retrieval System (EDIFAR) of SEBI within the
time frame prescribed in this regard. The Company's results andofficial news release are also displayed on the Company's web site
and on the websites of The Stock Exchange, Mumbai and National
StockExchange.
Management Discussions and Analysis
A detailed report on Management Discussions and Analysis is
included in the Annual Report.
General Shareholders Information
Monday, 23rd July, 2007 at
1. Bombay Stock Exchange Ltd. Phiroze Jeejebhoy Towers
Dalal Street, Fort, Mumbai 400 001
Stock Code 511072
2. National Stock Exchange of India Ltd.
Exchange Plaza, Bandra Kurla Complex, Bandra East, Mumbai 400051.
Stock Code DEWANHOUS
INE-202B01012
Twenty - Third Annual General Meeting
Listing on Stock Exchanges
ISIN Number for NSDL & CDSL
12 Noon
M C Ghai Hall, Bhogilal Hargovidas Building, 2nd Floor,
18/20, Kaishushru Dubash Marg, Fort, Mumbai 400 001
1st of April to 31st MarchFirst Quarter - By last week of July
Second Quarter - By last week of October
Third Quarter - By last week of January
Results for the year - May/June
Monday 16th July, 2007 to Monday, 23rd July, 2007
(both days inclusive)
The final dividend if declared by the shareholders at the
Annual General Meeting shall be paid on or before
23rd August, 2007, i.e. within 30 days from the date of declaration.
Date, Time and Venue
Financial Reporting Calendar : 2007-08
Dates of Book Closure
Dividend Payment dates
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Non- Mandatory Requirements
Yes
The Company has constituted a Remuneration and Compensation
Committee, comprising of 3 independent directors, Shri R. P. Khosla,
Shri R. S. Hugar and Shri G. P. Kohli
a) Whether Chairman of the Board is entitled to
maintain a Chairmans office at the Companys
expenses and also allowed reimbursement of
expenses incurred in performance of his duties.
b) Remuneration and Compensation Committee
Market Price Data
The monthly high and low stock valuations along with the volume of shares traded at BSE and NSE are:
Period High Low Qty. Traded High Low Qty. Traded
April.06 80.00 64.00 4910617 82.65 60.00 5836093
May.06 96.00 63.00 28109116 95.90 63.00 37125487
Jun-06 101.80 53.00 35195795 101.80 53.15 52809060
Jul-06 69.45 51.00 5170277 69.35 51.00 7400787
Aug-06 71.00 57.00 5930788 71.20 57.25 8541341
Sep-06 88.45 61.85 27601192 88.50 61.80 48321935
Oct-06 83.85 71.50 6250028 83.85 71.70 10764417
Nov-06 83.70 67.50 7201330 84.00 67.25 11264565
Dec-06 80.90 71.10 3335439 80.75 71.50 3870069
Jan-07 88.50 75.30 6803375 88.40 75.30 9610551
Feb.07 88.95 63.00 4117710 89.00 66.35 5310991
Mar.07 73.50 59.00 795760 73.60 59.00 1038176
NSE-PriceBSE-Price
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Performance Comparison with BSE Sensex
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DHFL
Sensex
Performance Comparison with NSE Index
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DHFL
Index
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Distribution of Shareholding as on 31st March, 2007
Shares holdingof nominal Value
Rupees Number % to In Rupees % to TotalAmountTotal Nos
1 2 3 4 5
Upto 5,000 18959 88.3090 28867380 5.7590
5,001 to 10,000 1383 6.4420 11347400 2.2640
10,001 to 20,000 573 2.6690 8627480 1.7210
20,001 to 30,000 168 0.7830 4404660 0.8790
30,001 to 40,000 72 0.3350 2645130 0.5280
40,001 to 50,000 90 0.4190 4342390 0.8660
50,000 to 1,00,000 119 0.5540 9249900 1.8450
1,00,000 and above 105 0.4890 431740850 86.1370
Total 21469 100.0000 501225190 100.0000
Share AmountShare Holders
Shareholding pattern of the Company as on 31st March, 2007
Category No of Shares % of Shareholding
Promoters 12863655 25.6644
Persons acting in concert 16445234 32.8101
Bodies Corporate 9414850 18.7837
UTI & Mutual Funds 19500 0.0389
FIIs/ NRI 3323560 6.6309
Banks 149133 0.2975
Resident Individuals 7906587 15.7746
Total 50122519 100.0000
Registrar and Share Transfer System
All the applications regarding physical transfer, transmission,
splitting of share certificates, dematerialization and rematerialzation
are processed by the Registrar and Share Transfer Agents, Intime
Spectrum Registry Limited and approved by the Managing Director
periodically depending on thevolume of transfers. Share Certificatesare dispatched within the time prescribed under the Listing
Agreement/SEBI Guidelines.
Dematerialization of Shares and Liquidity
As on 31st March, 2007, 93.45% of the share capital of the Company
representing 4,68,39,704 equity shares were held in dematerialized
form and the balance 6.55% representing 32,82,815 equity shares
were held in physical form.
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Listing of Debt Securities
Pursuant to the directions of Securities & Exchange Board of India
(SEBI) all the secured debt securities issued by the Company on
private placement basis have been listed in the Wholesale Debt
Market (WDM) Segment of the National Stock Exchange of India
Limited. The company complies with the listing requirements in
thisregard.
Outstanding GDRs/ADRs/ Warrantsor any convertible instruments
The Company has issued 70,65,456 Optionally Convertible
Preference Shares of face value Rs. 25/- each at a premium of Rs.
50/- each, aggregating to Rs. 52,99,09,200/- to M/s. Caledonia
Investments Plc, U.K. with an option to the Investor, to be converted
into 70,65,456 equity shares bearing a face value Rs. 10/- each and
a premium of Rs. 65/- per share, after 13 months but before
18months from thedate ofallotment .
The Company has also allotted 33,35,000 Convertible Warrants of
Rs. 75/- each, aggregating to Rs. 25,01,25,000/- on a preferential
basis, to M/s. Wadhawan Holding Private Limited, Promoter Group,
which shall, at the option of warrant holders, be converted into
33,35,000equity shares of Rs.10/-each ata premiumof Rs.65/-per
share, after 13 months but before 18 months from the date of
allotment ofthe said warrants.
Transfer of unclaimed dividend to InvestorEducation and Protection Funds
Pursuant to provisions of Section 205A(5) of the Companies Act,
1956, dividend which remains unpaid or unclaimed for a period of
seven years from the date of its transfer to unpaid dividend account
is required to transferred by the Company to the Investor Education
and Protection Fund (IEPF), established by the Central Government
under the provisions of Section 205C of the Companies Act, 1956.
Shareholders are advised to claim the unclaimed dividend lying in
theunpaid dividend account of theCompanybetween theduedates
of declarationof dividend and corresponding dates when unclaimed
divided are due for transfer to IEPF. Information in respect of such
unclaimed dividend for the three years when due for transfer to the
said Fund isgiven below :
Financial Date of Due forYear ended Declaration Transfer on
1999 2000 (Final) 18/08/2000 28/09/2007
2000-2001 30/07/2001 03/09/2008
2001-2002 31/07/2002 04/09/2009
Investor Correspondence
Shareholders may also contact the following for any assistance:
Shareholdersholding shares in electronicmodeshould addressall their correspondence through theirrespectiveDepositoryParticipants.
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Registrar & Transfer Agent:
Share Registry
Intime Spectrum Registry Ltd.
C-13, Pannalal Silk Mills Compound, L. B. S. Marg, Bhandup (W), Mumbai - 400 078
Phone: 91-22-2596 3838 Fax: 91-22-2594 6969
Compliance Officer & Company Secretary,
6th Floor, Dheeraj Arma, Anant Kanekar Marg, Station Road, Bandra (East), Mumbai-400 051
Tel: 91-22- 2658 3333
email: [email protected]
Sr. Manager - Secretarial,
6th Floor, Dheeraj Arma, Anant Kanekar Marg, Station Road, Bandra (East), Mumbai-400 051
Tel: 91-22- 2658 3333
email: [email protected]
Mr. Sharad Patkar
Mr. S. Y. Sankhe
Mr. P. K. Kumar,
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AUDITORS ON CORPORATE GOVERNANCEREPORT
To theMembers,
We have examinedthe compliance of conditionsof Corporate Governance by Dewan HousingFinance Corporation Ltd. for theyear ended 31st
March,2007, as stipulatedin Clause 49of theListing Agreement ofthe said Companywith thestock exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination has been limited to review of
the procedures and implementations thereof adopted by the Company for ensuring compliance with the conditions of the Corporate
Governance as stipulated in thesaid Clause. Itis neitheran audit noran expressionof theopinion on thefinancial statementsof theCompany.
In our opinion and to the best of our information and according to the explanations given to us and based on the representations made by the
Directors and theManagement, we certify that the Company hascompliedwith theconditions of Corporate Governance as stipulated in Clause
49of theabovementioned ListingAgreement.
As required by the Guidance Note issued by the Institute of Chartered Accountants of India we have to state that no investor grievances were
pendingfor a periodof onemonthagainstthe Companyas perthe recordsmaintainedby theShareholders / InvestorsGrievancesCommittee.
We further state that such compliance is neitheran assurance as to the future viability of the Company nor of the efficiency or effectiveness with
which themanagementhas conducted the affairs of theCompany.
DewanHousing Finance CorporationLtd.
For B. M. CHATURVEDI & CO.
B. M. Chaturvedi
Chartered Accountants
ICAI M.No.17607Place : Mumbai
Date : 15 May 2007th
,
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DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL
WITHTHECOMPANYSCODE OF CONDUCT
This is to confirm that the Company has adopted a Code of Conduct for the Board of Directors and Senior Management of the Company.
Thesame is availableon websiteof theCompanyas www.dhfl.com.
As Vice Chairman and Managing Director of Dewan Housing Finance Corporation Limited and as required by Clause 49(1)(D)(ii) of the Listing
Agreement of the Stock Exchanges in India, I hereby declare that all the Board members and senior management personnel of the Company
haveaffirmedcompliancewith theCode ofConductfor thefinancial year 2006-07.
Kapil WadhawanVice Chairman & Managing Director
Place : Mumbai
Date : 15 May 2007th
,