Notes to Accounts of Repco Home Finance Ltd.

Mar 31, 2025

a) The above borrowings (except term loans from NHB) are secured by first and exclusive charge on the specific book debts/ receivables of the company. The term loans from NHB are secured by a negative lien on the loan assets of the Company. In respect of loan outstanding amounting to ^709.64 crores as at March 31, 2025, the Company has executed irrevocable Powers of Attorney in favour of the banks so as to enable the bank to sell the loan assets of the Company, if necessary.

b) The repayment of the borrowings are done in monthly, quarterly, half-yearly and annual instalments as per the sanction terms.

c) The Company has not made any default in repayment of instalments during the financial year.

d) The borrowings have not been guaranteed by Directors or others

e) The Company has borrowed funds on the basis of security of current assets. It has filed quarterly returns or statements of current assets and the said returns/statements are in agreement with books of accounts.

f) There were no delay in repayment of borrowings during the financial year

g) No bank or lender has declared the Company as wilful defaulter

h) The Company has utilised the funds raised from banks and financial institutions for the specific purpose for which they were borrowed.

d) Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of ^10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Note 18.1: Nature and purpose of reserves Note 18.1.1: Securities premium reserve

Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

Note 18.1.2: Special Reserve

As per Section 29C(i) of the National Housing Bank Act, 1987, 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. The Company has transferred an amount of ^77.20 Crores (Previous year ^79.06 Crores) to Special Reserve in terms of Section 36(1)(viii) of the Income Tax Act, 1961.

Note 18.1.3: Statutory reserve

The Company has transferred an amount of ^87.89 Crores during the year (Previous year ^78.94 Crores) to Statutory Reserve under Section 29C of the National Housing Bank Act, 1987.

Note 18.1.4: General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers were to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013. During the year, the company has transferred ^50 Crores (Previous year ^35 Crores) to General Reserve.

Note 18.1.5: Retained Earnings

Retained earnings represents the amount of accumulated earnings of the Company.

Note 18.1.6: Other Comprehensive Income

Other Comprehensive Income represents remeasurement of the net defined benefit liabilities comprising of actuarial gain / loss. Note 18.1.7: Issues of bonus shares / Buyback of shares:

The Company has not issued / allotted any share pursuant to contracts without payment being received in cash, nor issued any bonus shares nor there has been any buyback of share during five years immediately preceding March 31, 2025.

Note 18.1.8: Dividend

The Board of Directors at their meeting held on May 16, 2025 have recommended dividend of ^4 per equity share for the year ended March 31, 2025 (Previous year ^3 per equity share) subject to the approval of shareholders at the ensuing Annual General Meeting.

f) Reason for above shortfalls

i) For the financial year ended on March 31, 2025, the CSR projects amounting to ^1.40 Crore were approved and classified as ongoing projects by the Board. Accordingly, as prescribed under the Companies Act, 2013, the unspent CSR amount of ^0.33 crores was transferred to a separate bank account opened for Unspent CSR amount within the time limit and the funds will be utilized towards the ongoing CSR projects.

ii) For the financial year ended on March 31, 2024, the CSR projects amounting to ^2.55 Crore were approved and classified as ongoing projects by the Board. Accordingly, as prescribed under the Companies Act, 2013, the unspent CSR amount of ^2.55 crores was transferred to a separate bank account opened for Unspent CSR amount within the time limit and the funds will be utilized towards the ongoing CSR projects.

g) There are no related party transactions during the year ended March 31, 2025 and March 31, 2024 in respect of CSR activities.

h) The nature of CSR Activities undertaken by the Company

- Promoting education, including enhancing vocational skills among the differently abled and livelihood enhancement projects

- Promotion of health care, including preventive health care

- Rural development

- Measures for reducing inequalities faced by socially and economically backward groups

- Eradicating hunger, poverty and malnutrition

- Setting up old age homes for senior citizens

Note 30: Segment information

The Company operates under the principal business segment which is "to provide loans against/for purchase, construction, repairs & renovations of housing/commercial properties". Further, the Company is operating in a single geographical segment. The Chief Operating Decision Maker (CODM) views and monitors the operating results of its single business segment for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profits or losses and is measured consistently with operating profits or losses in the financial statements. Accordingly, disclosures relating to primary and secondary business segments under the Indian Accounting Standard on ''Segment Reporting'' (Ind AS 108) are not applicable to the Company.

Note 31: Retirement benefit plan Note 31.1: Defined contribution plan

A Contribution towards Provident Fund is determined under the Employees'' Provident Funds & Miscellaneous Provisions Act,1952 and charged to the Statement of Profit and Loss during the period of incurrence when the services are rendered by the employees.

The expense charged in statement of profit and loss amounting to ^6.20 crores (March 31, 2024: ^5.46 crores) represents contributions payable to these plans by the Company at rates specified in the rules of the plan.

Note 31.2 - Defined benefit plan

The Company has a defined benefit gratuity plan in India (funded). The Company’s defined benefit gratuity plan is a final salary plan for India employees, which requires contributions to be made to a separately administered fund. The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the member''s length of service and salary at retirement age.

Note 32.8: Details of financing of parent company products:

NIL

Note 32.9: Details of Single Borrower Limit (SGL) / Group Borrower Limit (GBL):

The company has not exceeded limit prescribed for Single Borrower Limit (SGL) and Group Borrower Limit (GBL) during the year ended March 31, 2025 and March 31, 2024.

Note 32.10: Unsecured Advances:

The Company has not financed against intangible securities such as rights, licenses, authority etc as collateral security during the years ended March 31, 2025 and March 31, 2024.

Note 32.19: Net Profit or Loss for the period, prior period items and changes in accounting policies:

During the year,

(a) no prior period items occurred which has impact on Statement of Profit and loss,

(b) no change in Accounting policy,

(c) there is no withdrawal from reserve fund.

Note 32.20: Revenue Recognition

There are no circumstances in which revenue recognition has been postponed by the Company pending the resolution of significant uncertainties. Also, refer note no.3.11 and 3.12 for accounting policy with respect to revenue recognition.

Note 32.21 - Consolidated Financial Statements (CFS)

The Company has no investment in subsidiaries and hence requirement of CFS involving subsidiary company is not applicable. However, share of profit from associate company is consolidated and reported.

Note: 32.35

There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at March 31, 2025. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

Note 32.36

Earnings and Expenditure in foreign currency - Nil (March 31, 2024: Nil)

vi) Institutional set-up for liquidity risk management

The Company has put in place a well-defined Risk Management Policy which includes Liquidity Risk Management policy and Contingency Funding plan to manage and monitor Liquidity risk of the Company efficiently and to report the Board on the effectiveness of the same. The Company has an Asset Liability Management Committee (ALCO) headed by the MD & CEO and its members consisting of the Senior Management officials representing Finance, Sales, Credit, Recovery, IT and Risk. The ALCO is a decision-making unit responsible for integrated balance sheet management from risk-return perspective including the strategic management of interest rate and liquidity risks. The ALCO monitors the liquidity risk by ensuring judicious mix of assets and liabilities so as to reduce mismatch in the ALM and also monitors the implementation of the Liquidity Risk Management tools prescribed in the Liquidity Risk Management Policy of the Company. The outcomes of ALCO are promptly reported to the Risk Management Committee of the Board and to the Board of Directors at regular intervals.

Note 35: Disclosure pursuant to RBI notification no. RBI/2020-21/60 DOR.NBFC(HFC).

CC.No.118/03.10.136/2020-21 dated October 22, 2020 and RBI/2019-20/170 DOR(NBFC).CC.PD.

No.109/22.10.106/2019-20 dated March 13, 2020 on Implementation of Indian Accounting Standards

As required by the RBI Notification no. RBI/2020-21/60 DOR.NBFC (HFC).CCNo.U8/03.10.136/2020-21 dated October 22, 2020, the Company has complied with the requirements of Ind AS and the Guidelines and Policies approved by the Board in recognition of impairment of financial instruments. The overall impairment loss allowance as at March 31, 2025 and March 31, 2024 made under Ind AS is higher than the prudential floor prescribed by RBI/NHB.

Note 39: Contingent liabilities & Commitments Note 39.1: Contingent liabilities
Particulars	As at	As at
	March 31, 2025	March 31, 2024
i) Claims against the company not acknowledged as debts	15.88	15.62
ii) Income tax liabilities and GST liabilities	5.80	3.31
Note 39.2: Commitments
Particulars	As at	As at
	March 31, 2025	March 31, 2024
i) Commitment towards sanction pending disbursement including part disbursement	791.11	492.05
ii) Pending capital commitment	0.18	0.20
Note 40: Particulars of dividend paid to Non-resident shareholders
Particulars	For the year ended	For the year ended
	March 31, 2025	March 31, 2024
No of Shareholders	1,249	1,217
No of Shares held in numbers	9,555,993	10,419,518
Year for Which Dividend is Paid	FY 2023-24	FY 2022-23
Gross amount of Dividend (Rupees in Crores)	2.87	2.81
Note 41: Amount of Dividend proposed to be distributed to the Equity Shares holders for the year ended
Particulars	For the year ended	For the year ended
	March 31, 2025	March 31, 2024
Dividend %	40.00%	30.00%
Dividend per share	4.00	3.00
Total Amount of dividend Proposed to be distributed	25.02	18.77

The Company has lease contracts for Land and Building used for the branches. Leases of such assets generally have lease terms between 1 and 12 years. The Company''s obligations under its leases are secured by the lessor’s title to the leased assets. There is no revaluation of ROU assets during the year or previous year.

Note 43.1: Valuation principles

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e., an exit price), regardless of whether that price is directly observable or estimated using a valuation technique.

In order to show how fair values have been derived, financial instruments are classified based on a hierarchy of valuation techniques. Note 43.2: Valuation governance

The Company''s fair value methodology and the governance over its models includes a number of controls and other procedures to ensure appropriate safeguards are in place to ensure its quality and adequacy. All new product initiatives (including their valuation methodologies) are subject to approvals by various functions of the Company including the risk and finance functions. The responsibility of ongoing measurement resides with the business units. Once submitted, fair value estimates are also reviewed and challenged by the Risk and Finance functions.

Note 43.3: Valuation methodologies of financial instruments not measured at fair value

Below are the methodologies and assumptions used to determine fair values for the above financial instruments which are not recorded and measured at fair value in the company’s financial statements. These fair values were calculated for disclosure purposes only. The below methodologies and assumptions relate only to the instruments in the below tables.

Loans and advances to customers

The fair values of loans and receivables are estimated by discounted cash flow models that incorporate assumptions for credit risks, probability of default and loss given default estimates. Where such information is not available, the company uses historical experience and other information used in its collective impairment models.

Fair values of lending portfolios are calculated using a portfolio-based approach. The company then calculates and extrapolates the fair value to the entire portfolio, using discounted cash flow models that incorporate interest rate estimates considering all significant characteristics of the loans. The credit risk is applied as a top-side adjustment based on the collective impairment model incorporating probability of defaults and loss given defaults.

Note 44: Risk management

Note 44.1: Introduction and risk profile

Company has operations in India. As the company is in financial sector, the risks associated with this type of business is integral part of the management. The company deals with large number of customers and is involved in long term lending. Hence, the risks to this type of business is unique and requires focused attention. Further, the management of risk is continuous and on going process and needs to be dynamic. The company is aware that risk is proportionate to the expected returns but should have limitations in exposing itself to the risks. This process of risk management is critical to the company''s continuing profitability and reputation in the market. The company is generally exposed to credit risk, market risk, operational risk, compliance risk, reputational risk and Competition risk.

Note 44.1.1: Risk management structure

The Company has in place a Risk Management Policy duly approved by the Board covering various aspects of the risk management. Board of Directors are responsible for effective risk management. It oversees and reviews the overall functioning of the risk management and provide necessary directions in this regard.

The Risk Management Committee of the Board (RMCB) is Board level committee entrusted with overseeing implementation of the Risk Management Policy / strategy to deal with risk management activities in an efficient and effective manner. The committee reviews the functioning of the risk management framework at periodical intervals. It reviews the reports and directs for taking mitigating steps. The committee reports the status of the risk management of the company to the Board at periodical intervals through minutes of the meeting of the committee. The minutes of the committee are placed before the Board.

Credit and Operational Risk Management Committee (CORMC) is an executive level committee headed by Managing Director (MD) as Chairman of the Committee, having members viz., Chief Operating Officer (COO), Chief Business Officer (CBO), Chief Development Officer (CDO), Chief Financial Officer (CFO), Chief Technology Officer (CTO), all the General Managers, Chief Compliance Officer (CCO), Head of Internal Audit (HIA), Head of Legal. It is responsible for laying down the operational guidelines and monitor and mitigate the credit and operational risks the company is facing. This Committee periodically (Atleast Quarterly once or on need basis) reviews the portfolio studies, Risk and Control Self-Assessment studies conducted at branches, monitor various Key Risk Indicators (KRI), etc. and provide necessary mitigations. It also reviews and recommends the Risk Management Committee of the Board (RMCB) the amendments to Risk Management Policy, as and when considered necessary. The minutes of this committee is placed before Risk Management Committee of the Board (RMCB). Besides this, Assets and Liabilities Management Committee (ALCO) addresses the market and liquidity risks, conducted atleast once on monthly basis.

The Risk Management Department'' in Corporate Office of the company is responsible for Identification, measurement, monitoring and taking steps for mitigation of operational, credit and compliance risk and reporting to top management and the committees concerned.

The company has an independent Risk Management department headed by Chief Risk Officer (CRO) who is responsible for coordination, overseeing and implementation of the requirements identified in the Board approved Risk Management Policy.

Note 44.1.2: Risk Identification

The Company has identified risk issues in various functions such as branches, departments in Corporate Office, Regional Offices, Central Depository, etc. and maintains a Risk Register. The register covers risk and controls covering various types of risks like Operational risk, Credit risk etc. across the departments. This register is dynamic as it gets updated by additions and deletions as and when new guidelines are issued. Further, each risk is categorised as "Operational Risk", "Credit Risk", "Market Risk", "Compliance Risk or "Competition Risk".

Note 44.1.3: Risk measurement

The risk issues identified and recorded in the Risk Register are measured based on the impact it may have on the business if the company is exposed to such risks. Based on the velocity of impact each risk is categorised as ''High'', ''Medium'' and ''Low'' risk. This is done to decide the quantum of focus required in respect of each risk issue. Weightage is given for each risk issue to enable the company to measure the risk. The company gives focus on ''High'' risk issues for better management.

The frequency for monitoring each risk issues is at quarterly intervals. Risk issues are grouped under different categories and being reviewed after the end of each quarter.

Note 44.1.5 - Risk Assessment methodology

The risk is assessed based on self assessment by the owners of risk at the prescribed intervals. Each risk issue has to be assessed by the owners of the risk and provide a certification. The certificate is subject to verification by Risk Management Department and by Internal Auditors. Accordingly, each branch assesses the level of compliance in respect of each risk issue and provides a certificate. For this purpose, a software utility has been provided to each branch, departments in Corporate Office (CO), regional offices and Central depository (CDR). This exercise is done every quarter.

Note 44.1.6 - Measurement of Risk

Based on the Self -assessment certifications from various risk owners, the quantum of risk that are reported by the owners are calculated for various categories of risks such as credit risk, operational risk, compliance risk and competition risk. Risk is also measured in terms of high, medium and low. This would help the Company to arrive at the direction of risk. Additionally, the Risk Management department also performs stress testing on a half yearly basis under various stress scenarios from the perspective of ensuring the Company''s Capital and P&L under any unfavourable/unforeseen market circumstances to ensure the financial stability of the Company under the stress period.

Note 44.1.7 - Credit risk

The Company is primarily in the business of lending and hence is exposed to credit risk. Various credit risk mitigations are provided in the Credit Policy of the company such as profiling each customer based on various factors of the borrower and linking pricing to the same. The internal rating of each borrower is done as a part of appraisal to arrive at the risk. The Credit risk issues are identified by the Risk Management Department and provided to the branches and Credit Department for assessment. Mitigation steps are taken immediately to manage the risk. Immediate action is initiated by way of SARFAESI, OTS, etc to recover the impaired credit.

Assets possessed under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002: Loan Portfolio includes gross loans amounting to t27.59 Crores (March 31, 2024: t33.01 Crores) against which the Company has taken possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. The value of assets possessed against these loans is t104.27 Crores (March 31, 2024: t119.06 Crores).

Restructuring of accounts

The economic fallout on account of COVID-19 pandemic has led to significant financial stress for many borrowers. Considering the above, with the intent to facilitate revival and to mitigate the impact on ultimate borrowers, Reserve Bank of India (RBI) introduced measures under the Resolution Framework for COVID-19. As per the RBI Framework, the Corporation established a policy to provide resolution for eligible borrowers having stress on account of COVID-19 in line with the RBI Guidelines.

As advised under the said circular and Company’s policy, the eligibility of customers was assessed, so as to understand the extent of financial stress caused due to COVID-19, i.e. delay in construction, sales and consequent cash flow mismatch, duly supported by the documentary evidence. In addition to assessing the impact of stress, the Resolution framework was discussed with the eligible borrower prior to invocation of Resolution plan. The Resolution Framework offered to ensure that the servicing of the restructured loan is not likely to be impacted.

Moratorium

The RBI had announced Moratorium for 6 months on repayments for the period March 2020 to August 2020 for term loans and working capital facilities outstanding as on February 29, 2020. This was part of the regulatory measures adopted to mitigate the burden of debt servicing brought about by disruptions on account of Covid pandemic and to ensure continuity of viable businesses. As part of the scheme and as per Company''s Board approved policy, the Company has provided moratorium to eligible borrowers.

The company''s independent Credit Risk Department operates its internal rating models. The company runs separate models for its key portfolios in which its customers are categorised as high, medium and low grade. The models incorporate both qualitative and quantitative information and, in addition to information specific to the borrower, utilise supplemental external information that could affect the borrower’s behaviour. Loan assets are graded based on repayment behaviour of the customer of last 12 months.

Note 44.1.7.2 - Impairment - Expected credit loss (ECL)

The application of Ind AS 109 has necessitated fundamental changes to the accounting for expected default risk (risk provisioning). Specifically, the incurred loss model has been replaced by the Expected Credit Loss model (ECL). Consequent to this change, the Expected Credit losses on financial instruments are classified under three stages.

Stage 1: Every financial asset is classified as stage 1, upon initial recognition. In addition, stage 1 contains all transactions with limited default risk.

Stage 2: Financial assets whose default risk has risen significantly since initial recognition and which are not classified as cases with limited default risk.

Stage 3: Financial assets that display objective evidence of impairment at the reporting date.

The accounting standard, Ind AS 109 does not specifically prescribe any methodology for computing ECL. However, entities are required to adopt sound and market acceptable methodologies which are in line with the size, complexity and risk-profile of the financial entity for computing the ECL. The Company uses three main components to measure ECL. These are, Exposure at default (EAD), Probability of Default (PD) and Loss Given Default (LGD).

Exposure at default (EAD) is defined as the sum of Principal outstanding and interest accrued at the reporting date.

PD is defined as the probability of borrowers defaulting on their obligations.

LGD represents the economic loss. Company uses historical loss data for identified homogenous pools for the purpose of calculating LGD. For individual cases where there as been a significant deterioration in recovery, the LGD is considered to be 100%.

Accordingly, loan assets are categorised under three different stages, as under:

Stage 1: Where instalments are Current and 1-30 days overdue Stage 2: Where instalments are 31 days - 90 days overdue and Stage 3: Where instalments are overdue beyond 90 days

The company is required to provide 12-month Expected Credit Loss (12-month ECL) for stage 1 assets and the Life Time Expected Credit Loss (LECL) for stage 2 and stage 3 assets.

12-month ECL is the expected credit loss that results from default events that are possible within 12 months after the reporting date. LECL represents the expected credit loss from default events over the expected life of a financial asset.

As prescribed under para 5.5 in Ind AS 109, 12-months PD is required to be computed for financial instruments which are in stage 1, and life time PD for those in stage 2 & 3. 12-months PD is the likelihood of the borrower defaulting in the 12 months following the reporting date while life time PD is the likelihood of the borrower defaulting during the residual tenor.

The PD model has been developed for all the major asset classes using a statistical and iterative approach. The design and construction of the model involves identification of various credit parameters and variables that have a strong and direct correlation to propensity of default. The PD model reflects to the probability of default, taking into consideration the inherent credit quality of the borrower and the residual tenor of each contract. The PD for stage 3 contracts is considered at 100%. Where a customer has one contract in stage 3 and one or more contracts in stage 1 / stage 2, the PD for all the contracts is considered at 100%.

LGD represents the economic loss, adjusted for cure rate, as a percentage of exposure at the time of default. Economic loss is the estimated shortfall in realisation of dues, in the event of default. Contracts that have turned delinquent do not necessarily involve ultimate losses, since many of them are resolved through corrective actions. The cure rate is the probability of a ''non performing'' (i.e. defaulted) contract reverting to a ''performing'' (i.e. non-default) status in a year. For individual cases where there as been a significant deterioration in recovery, the LGD is considered to be 100% for those cases.

Note 44.1.8: Operational Risk

Operational Risk is constantly monitored as it is prevalent in every branch and department. Systematic improvements are made wherever required. The Operational Risk Management team identifies and monitors the operational risks in various products as well as processes of the Company. It ensures that major risks are covered or mitigated in order to avoid or minimize operational risk loss.

Note 44.1.9: Compliance Risk

Based on the guidelines received from regulatory and statutory authorities and also based on the policy requirements, the compliance risks issues are identified, assessed and monitored for compliance.

Note 44.1.10: Market Risk

The Company does not accept deposits from public. The resources are mobilized from banks and market. The Company has a specific committee named Assets and Liabilities Committee (ALCO) which meets at frequent intervals (minimum once in Month) to manage the liquidity, interest rates, spread etc. The Committee also prescribes Minimum Lending Rate (MLR).

Note 44.1.11: Interest Rate Risk

The Company is subject to interest rate risk, since the rates of loans and borrowings might fluctuate over the tenure of instrument. Interest rates are highly sensitive to many factors beyond control, including the monetary policies of the Reserve Bank of India, deregulation of the financial sector in India, domestic and international economic and political conditions, inflation and other factors. In order to manage interest rate risk, the Company seeks to optimise borrowing profile between short-term and long term loans. The liabilities are categorised into various time buckets based on their maturities and Asset Liability Management Committee supervise an interest rate sensitivity report periodically for assessment of interest rate risks.

Note 44.2 - Capital Management

"The Company’s capital management strategy is to effectively determine, raise and deploy capital to cover risk inherent in business and meeting the capital adequacy requirements of the Reserve Bank of India (RBI). The Company finances its operations by a combination of retained profit and bank borrowings. The Company determines the amount of capital required on the basis of operations and capital expenditure. The adequacy of the Company''s capital is monitored using, among other measures, the regulations issued by the RBI.

The capital structure is monitored on the basis of net debt to equity and maturity profile of overall debt portfolio. The Company''s policy is in line with Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 which currently permits HFCs to borrow up to 12 times of their net owned funds (""NOF""). Refer Note 32.1 for Capital to risk weighted assets ratio (CRAR).

Note 45.1 - Collateral and other credit enhancements

Although collateral can be an important mitigation of credit risk, it is the Company''s practice to lend on the basis of the customer’s ability to meet the obligations out of cash flow resources other than placing primary reliance on collateral and other credit risk enhancements. The Company obtains first and exclusive charge on all collateral that it obtains for the loans given. Home loans/ home equity loans are secured by collateral at the time of origination. In case of Home loans/ home equity loans, the value of the property at the time of origination will be arrived by obtaining valuation reports from Company''s empanelled valuers. Immovable Property is the collateral for Home loans/ Home Equity loans. Security Interest in favour of the Company is created by Mortgage through deposit of title deed which is registered wherever required by law. Any surplus remaining after settlement of outstanding debt by way of sale of collateral is returned to the customer / borrower.

Note 46 - Liquidity risk and funding management

Liquidity risk is defined as the risk that the company will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Liquidity risk arises because of the possibility that the company might be unable to meet its payment obligations when they fall due as a result of mismatches in the timing of the cash flows under both normal and stress circumstances. Such scenarios could occur when funding needed for illiquid asset positions is not available to the company on acceptable terms. To limit this risk, management has arranged for diversified funding sources and adopted a policy of managing assets with liquidity in mind and monitoring future cash flows and liquidity on a daily basis. The company has developed internal control processes and contingency plans for managing liquidity risk.

The company maintains diverse assets that are assumed to be easily liquidated in the event of an unforeseen interruption in cash flow. The company also has lines of credit that it can access to meet liquidity needs. In accordance with the company''s policy, the liquidity position is assessed under a variety of scenarios, giving due consideration to stress factors relating to both the market in general and specifically to the company. Net liquid assets consist of cash and cash equivalents, balances other than cash and cash equivalents available for immediate use, less securities issued and borrowings due to mature within the next month.

Note 48:

a) No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

b) The Company has not been declared as a wilful defaulter by any bank or financial institution or government or any government authority.

c) As per the information available with the Company, the Company has no transactions with the companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.

e) As a part of normal lending business, the company grants loans and advances on the basis of security / guarantee provided by the Borrower/ co-borrower. These transactions are conducted after exercising proper due diligence. Other than the transactions described above,

i) No funds have been advanced or loaned or invested by the Company to or in any other person(s) or entity(ies) including foreign entities ("Intermediaries") with the understanding that the Intermediary shall lend or invest in a party identified by or on behalf of the Company (Ultimate Beneficiaries);

ii) No funds have been received by the Company from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly, lend or invest in other persons or entities identified by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries

f) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year ended March 31, 2025 and March 31, 2024.

g) There are no transactions relating to previously unrecorded income that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.

h) The accounting software used by the Company to maintain its books of accounts has a feature of recording audit trail (edit log) facility and the same has been operated throughout the year for all transactions recorded in the software. Further, audit trail feature has not been tampered with in respect of accounting software where the audit trail has been enabled. Additionally, the Company has preserved audit trail in respect of the financial years ended March 31, 2024 and March 31, 2025 to the extent it was enabled and recorded in respect of those years.

Note 49 :

Disclosures pursuant to RBI Notification - RBI/DOR/2021-22/86 DOR.STR.REC.51/2 1.04.048/2021-22 dated September 24,

2021 (as amended from time to time):

a. The Company has not transferred or acquired, any loans not in default during the year ended March 31, 2025.

b. The Company has not transferred or acquired, any stressed loans during the year ended March 31, 2025.

Note 51:

The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017.

Note 52: Events after reporting date

There have been no material events after the reporting date that require disclosure in these financial statements.

Note 53:

Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / presentation.

Note 54: Approval of financial statements

The financial statements were approved for issue by the Board of Directors on May 16, 2025.

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Mar 31, 2024

4.4 Provisions, other contingent liabilities and contingent assets

4.4.1 Provisions and other contingent liabilities

The Company operates in a regulatory and legal environment that, by nature, has a heightened element of litigation risk inherent to its operations. As a result, it is involved in various litigation, arbitration and regulatory investigations and proceedings in the ordinary course of the Company''s business.

When the Company can reliably measure the outflow of economic benefits in relation to a specific case and considers such outflows to be probable, the Company records a provision against the case. Where the probability of outflow is considered to be remote, or probable, but a reliable estimate cannot be made, a contingent liability is disclosed.

Given the subjectivity and uncertainty of determining the probability and amount of losses, the Company takes into account a number of factors including legal advice, the stage of the matter and historical evidence from similar incidents. Significant judgement is required to conclude on these estimates.

4.4.2 Contingent assets

Contingent assets are not recognised in financial statements. However, it is disclosed only when an inflow of economic benefits are probable.

Provision, contingent liabilities and contingent assets are reviewed at each balance date.

4.4.3 Commitments

Commitments are future contractual liabilities, classified and disclosed as follows

a) The estimated amount of contracts remaining to be executed on capital account and not provided for

b) Undisbursed commitment relating to loans; and

c) Other non-cancellable commitments, if any, to the extent they are considered material and relevant in the opinion of management

4.5 Recent Pronouncements

Ministry of Corporate affairs ("MCA”) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended March 31, 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.

Notes:

A. Refinance from National Housing Bank (NHB) and other Term Loans from banks and financial institutions are secured by first and exclusive charge on the specific book debts/receivables of the Company and an irrevocable Power of Attorney (POA) given by the Company in favour of the Banks/NHB for recovery of dues and for creation of mortgage on the properties of the loan borrowers of the Company

B. The Company is not a large Corporate as per the applicability criteria given under the SEBI Circular SEBI/HO/DDHS/CIR/P/ 2018/144 dated November 26, 2018.

C. The repayment of the borrowings are done in monthly, quarterly, half-yearly and annual instalments as per the sanction terms

D. The Company has not made any default in repayment of instalments during the financial year

E. The borrowings have not been guaranteed by Directors or others.

F. The Company has borrowings from Banks and financial institutions on the basis of book debts and quarterly returns / statements of book debts filed with Bank are in agreement with the books of accounts.

G. There were no delay in repayment of borrowings during the financial year

H. No bank or lender has declared the Company as willful defaulter.

I. The Company has taken borrowings from banks and financial institutions and utilised them for the specific purpose for which they were taken during the financial year.

d) Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

I n the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

17.2 Nature and purpose of reserves

17.2.1 Securities premium reserve

Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

17.2.2 Special Reserve

As per Section 29C(1) of the National Housing Bank Act, 1987, 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. The Company has transferred an amount of Rs.79.06 Crores (Previous year Rs.68.60 Crores) to Special Reserve in terms of Section 36(1) (viii) of the Income Tax Act, 1961.

17.2.3 Statutory reserve

The Company has transferred an amount of Rs. 78.94 Crores during the year (Previous year Rs.59.22 Crores) to Statutory Reserve u/s 29C of the National Housing Bank Act, 1987.

17.2.4 General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers were to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013. During the year, the Company has transferred Rs. 35 Crores (Previous year Rs.35 Crores) to General Reserve.

17.2.5 Retained Earnings

Retained earnings represents the amount of accumulated earnings of the Company.

17.2.6 Other Comprehensive Income

Other Comprehensive Income represents remeasurement of the net defined benefit liabilities comprising of actuarial gain / loss.

17.3 Issues of bonus shares / Buyback of shares:

The Company has not issued / allotted any share pursuant to contracts without payment being received in cash, nor issued any bonus shares nor there has been any buyback of share during five years immediately preceding March 31, 2024.

17.4 Dividend

The Board of Directors at their meeting held on May 14, 2024 have recommended dividend of Rs.3 per equity share for the year ended March 31,2024 (Previous year Rs. 2.70 per equity share) subject to the approval of shareholders at the ensuing Annual General Meeting.

f) Reason for above shortfalls

i) For the financial year ended on March 31,2024, the CSR projects amounting to Rs.2.55 Crore were approved and classified as ongoing projects by the Board. Accordingly, as prescribed under the Companies Act, 2013, the amount of Rs.2.55 Crore was transferred to a separate bank account opened for Unspent CSR amount within the time limit and the funds will be utilized towards the ongoing CSR projects.

ii) For the financial year ended on March 31,2023, the CSR projects amounting to Rs.2.06 Crore were approved and classified as ongoing projects by the Board. Accordingly, as prescribed under the Companies Act, 2013, the amount of Rs.2.06 Crore was transferred to a separate bank account opened for Unspent CSR amount within the time limit and the funds were utilized towards the ongoing CSR projects to the extent of Rs.2.01 Crore during the FY 2023-24.

Note 29: Segment information

The Company operates under the principal business segment viz."Providing loans for construction or purchase of residential property”. Further, the Company is operating in a single geographical segment. The Chief Operating Decision Maker (CODM) views and monitors the operating results of its single business segment for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profits or losses and is measured consistently with operating profits or losses in the financial statements. Accordingly, disclosures relating to primary and secondary business segments under the Indian Accounting Standard on ''Segment Reporting'' (Ind AS 108) are not applicable to the Company.

Note 30: Retirement benefit plan Note 30.1 : Defined contribution plan

A Contribution towards PF is determined under the Employees'' Provident Funds & Miscellaneous Provisions Act, 1952 and charged to the Statement of Profit and Loss during the period of incurrence when the services are rendered by the employees

The expense charged in statement of profit and loss amounting to Rs. 5.46 crores (2023: Rs.5.14 crores) represents contributions payable to these plans by the Company at rates specified in the rules of the plan.

Note 30.2 : Defined benefit plan

The Company has a defined benefit gratuity plan in India (funded). The Company''s defined benefit gratuity plan is a final salary plan for Indian employees, which requires contributions to be made to a separately administered fund. The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the member''s length of service and salary at retirement age. The fund has the form of a trust and it is governed by the Board of Trustees.

Note 31.13: Registration obtained from other financial sector regulators:

Registration of Company as Composite Corporate Agent with Insurance Regulatory & Development Authority has been obtained.

Note 31.14 : Disclosure of Penalties imposed by NHB and other regulators

(i) During the year, the Stock Exchanges (NSE & BSE) have levied a penalty relating to non-compliance with the requirement pertaining to appointment / continuation of non executive director who has attained 75 years as per regulation 17 (1A) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 amounting to Rs. 0.02 Crores. The Company has made its representation before the Stock Exchanges for withdrawal and refund of penalty and the representation is yet to be disposed of by the Stock Exchanges.

(ii) There was no penalty imposed by NHB/ RBI/ other regulators on account of contravention of certain provisions/ regulations on the Company during the years ended March 31, 2024 and March 31,2023.

Note 31.15 :

As per the IND AS 24 - Related Party Disclosures, details of the related parties, nature of the relationship with whom Company has entered transactions, remuneration of directors and balances in related party account at the year end, are given in Note no. 36. All transactions with related parties were carried out in ordinary course of business at arm''s length price.

Note 31.16: Group Structure

Repco Home Finance Limited is promoted by REPCO Bank Limited (promoter) which presently holds equity shares in Repco Home Finance Limited to the extent of Rs.23.23 crores(2,32,30,606 equity shares of Rs.10/-each) which constitutes 37.13% of holding. Repco Home Finance Limited has an investment in the equity of unlisted Associate Company viz., Repco Micro Finance Limited to the extent of Rs.31.60 Crore (3,16,00,000 equity shares of Rs.10/-each) in FY 2023-24 and Rs.31.60 Crore (3,16,00,000 equity shares of Rs.10/- each) in FY 2022-23.

Note 31.19: Net Profit or Loss for the period, prior period items and changes in accounting policies:

During the year,

(a) no prior period items occurred which has impact on Statement of Profit and loss,

(b) no change in Accounting policy,

(c) there were no circumstances (other than income recognition on Non performing advances ) in which revenue recognition has been postponed pending resolution of significant uncertainty except implementation of Ind- AS required by Ministry of corporate affairs and

(d) there is no withdrawal from reserve fund.

Note 31.20: Revenue Recognition

There are no circumstances in which revenue recognition has been postponed by the Company pending the resolution of significant uncertainties. Also, refer note no. 3.12 for accounting policy with respect to revenue recognition.

Note 31.21: Consolidated Financial Statements (CFS)

The Company has no investment in subsidiaries and hence requirement of CFS involving subsidiary Company is not applicable. However, financial statement of associate Company is consolidated and reported.

Note 43.1 : Valuation principles

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e., an exit price), regardless of whether that price is directly observable or estimated using a valuation technique.

In order to show how fair values have been derived, financial instruments are classified based on a hierarchy of valuation techniques.

Note 43.2 : Valuation governance

The Company''s fair value methodology and the governance over its models includes a number of controls and other procedures to ensure appropriate safeguards are in place to ensure its quality and adequacy. All new product initiatives (including their valuation methodologies) are subject to approvals by various functions of the Company including the risk and finance functions. The responsibility of ongoing measurement resides with the business units. Once submitted, fair value estimates are also reviewed and challenged by the Risk and Finance functions.

Note 43.3 : Valuation methodologies of financial instruments not measured at fair value

Below are the methodologies and assumptions used to determine fair values for the above financial instruments which are not recorded and measured at fair value in the Company''s financial statements. These fair values were calculated for disclosure purposes only. The below methodologies and assumptions relate only to the instruments in the below tables.

Loans and advances to customers

The fair values of loans and receivables are estimated by discounted cash flow models that incorporate assumptions for credit risks, probability of default and loss given default estimates. Where such information is not available, the Company uses historical experience and other information used in its collective impairment models.

Fair values of lending portfolios are calculated using a portfolio-based approach. The Company then calculates and extrapolates the fair value to the entire portfolio, using discounted cash flow models that incorporate interest rate estimates considering all significant characteristics of the loans. The credit risk is applied as a top-side adjustment based on the collective impairment model incorporating probability of defaults and loss given defaults.

Note 44 : Risk management

Note 44.1: Introduction and risk profile

Company has operations in India. As the Company is in financial sector, the risks associated with this type of business is integral part of the management. The Company deals with large number of customers and is involved in long term lending. Hence, the risks to this type of business is unique and requires focused attention. Further, the management of risk is continuous and on going process and needs to be dynamic. The Company is aware that risk is proportionate to the expected returns but should have limitations in exposing itself to the risks. This process of risk management is critical to the Company''s continuing profitability and reputation in the market. The Company is generally exposed to credit risk, market risk, operational risk, compliance risk, reputational risk and Competition risk.

44.1.1 Risk management structure

The Company has in place a Risk Management Policy duly approved by the Board covering various aspects of the risk management. Board of Directors are responsible for effective risk management. It oversees and reviews the overall functioning of the risk management and provide necessary directions in this regard.

The Risk Management Committee of the Board (RMCB) is Board level committee entrusted with overseeing implementation of the Risk Management Policy / strategy to deal with risk management activities in an efficient and effective manner. The committee reviews the functioning of the risk management framework at periodical intervals. It reviews the reports and directs for taking mitigating steps. The committee reports the status of the risk management of the Company to the Board at periodical intervals through minutes of the meeting of the committee. The minutes of the committee are placed before the Board.

Credit and Operational Risk Management Committee (CORMC) is an executive level committee headed by Managing Director (MD) as Chairman of the Committee, having members viz., Chief Operating Officer (COO), Chief Development Officer (CDO), Chief Financial Officer (CFO), Chief Technology Officer (CTO), all the General Managers, Chief Compliance Officer (CCO), Head of Internal Audit (HIA), Head of Legal. It is responsible for laying down the operational guidelines and monitor and mitigate the credit and operational risks the Company is facing. This Committee periodically reviews the portfolio studies, Risk and Control Self-Assessment studies conducted at branches, monitor various Key Risk Indicators (KRI), etc. and provide necessary mitigations. It also reviews and recommends the Risk Management Committee of the Board (RMCB) the amendments to Risk Management Policy, as and when considered necessary. The minutes of this committee is placed before Risk Management Committee of the Board (RMCB). Besides this, Assets and Liabilities Management Committee (ALCO) addresses the market and liquidity risks.

The Risk Management Department'' in Corporate Office of the Company is responsible for Identification, measurement, monitoring and taking steps for mitigation of operational, credit and compliance risk and reporting to top management and the committees concerned.

The Chief Risk Officer (CRO) is designated as ''Risk Manager'' of the Company who is responsible for coordination, overseeing and implementation of the requirements identified in the Risk Management Policy.

44.1.2 Risk Identification

The Company has identified risk issues in various functions such as branches, departments in Corporate Office, Regional Offices, Central Depository, etc. and prepared a Risk Register. The register contains more than one thousand risk issues relating to various types of risks. This register is dynamic as it gets updated by additions and deletions as and when new guidelines are issued. Further, each risk is categorised as "Operational Risk”, "Credit Risk”, "Market Risk”, "Compliance Risk or "Competition Risk".

44.1.3 Risk measurement

The risk issues identified and recorded in the Risk Register are measured based on the impact it may have on the business if the Company is exposed to such risks. Based on the velocity of impact each risk is categorised as ''High'', ''Medium'' and ''Low'' risk. This is done to decide the quantum of focus required in respect of each risk issue. Weightage is given for each risk issue to enable the Company to measure the risk. The Company gives focus on ''High'' risk issues for better management.

44.1.4 Risk Monitoring

The frequency for monitoring each risk issues is at quarterly intervals. Risk issues are grouped under different categories and being reviewed after the end of each quarter.

44.1.5 Risk Assessment methodology

The risk is assessed based on self assessment by the owners of risk at the prescribed intervals. Each risk issue has to be assessed by the owners of the risk and provide a certification. The certificate is subject to verification by Risk Management Department and by Internal Auditors. Accordingly, each branch assesses the level of compliance in respect of each risk issue and provides a certificate. For this purpose, a software utility has been provided to each branch, departments in Corporate Office (CO), regional offices and Central depository (CDR). This exercise is done every quarter.

44.1.6 Measurement of Risk

Based on the Self -assessment certifications from various risk owners, the quantum of risk that are reported by the owners are calculated for various categories of risks such as credit risk, operational risk, compliance risk and competition risk. Risk is also measured in terms of high, medium and low. This would help the Company to arrive at the direction of risk.

44.1.7 Credit risk

The Company is primarily in the business of lending and hence is exposed to credit risk. Various credit risk mitigations are provided in the Credit Policy of the Company such as profiling each customer based on various factors of the borrower and linking pricing to the same. The internal rating of each borrower is done as a part of appraisal to arrive at the risk. The Credit risk issues are identified by the Risk Management Department and provided to the branches and Credit Department for assessment. Mitigation steps are taken immediately to manage the risk. Immediate action is initiated by way of SARFAESI, OTS, etc to recover the impaired credit.

The details of Assets possessed under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 is as below:

Loan Portfolio includes gross loans amounting to Rs.55.11 Crores (31 March 2023: Rs.48.13 Crores) against which the Company has taken physical possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. The value of assets against these loans is Rs. 116.04 Crores (31 March 2023: Rs 60.94 Crores)

Restructuring of accounts

The economic fallout on account of COVID-19 pandemic has led to significant financial stress for many borrowers. Considering the above, with the intent to facilitate revival and to mitigate the impact on ultimate borrowers, Reserve Bank of India (RBI) introduced measures under the Resolution Framework for COVID-19. As per the RBI Framework, the Corporation established a policy to provide resolution for eligible borrowers having stress on account of COVID-19 in line with the RBI Guidelines.

As advised under the said circular and Company''s policy, the eligibility of customers was assessed, so as to understand the extent of financial stress caused due to COVID-19, i.e. delay in construction, sales and consequent cash flow mismatch, duly supported by the documentary evidence. In addition to assessing the impact of stress, the Resolution framework was discussed with the eligible borrower prior to invocation of Resolution plan. The Resolution Framework offered to ensure that the servicing of the restructured loan is not likely to be impacted.

Moratorium

The RBI had announced Moratorium for 6 months on repayments for the period March 2020 to August 2020 for term loans and working capital facilities outstanding as on February 29, 2020. This was part of the regulatory measures adopted to mitigate the burden of debt servicing brought about by disruptions on account of Covid pandemic and to ensure continuity of viable businesses. As part of the scheme and as per Company''s Board approved policy, the Company has provided moratorium to eligible borrowers.

44.1.7.1 The Company''s internal grading

The Company''s independent Credit Risk Department operates its internal rating models. The Company runs separate

models for its key portfolios in which its customers are categorised as high, medium and low grade. The models incorporate both qualitative and quantitative information and, in addition to information specific to the borrower, utilise supplemental external information that could affect the borrower''s behaviour. Loan assets are graded based on repayment behaviour of the customer of last 12 months.

44.1.7.2 Impairment - Expected credit loss (ECL)

The application of Ind AS 109 has necessitated fundamental changes to the accounting for expected default risk (risk provisioning). Specifically, the incurred loss model has been replaced by the Expected Credit Loss model (ECL). Consequent to this change, the Expected Credit losses on financial instruments are classified under three stages.

Stage 1: Every financial asset is classified as stage 1, upon initial recognition. In addition, stage 1 contains all transactions with limited default risk.

Stage 2: Financial assets whose default risk has risen significantly since initial recognition and which are not classified as cases with limited default risk.

Stage 3: Financial assets that display objective evidence of impairment at the reporting date.

The accounting standard, Ind AS 109 does not specifically prescribe any methodology for computing ECL. However, entities are required to adopt sound and market acceptable methodologies which are in line with the size, complexity and risk-profile of the financial entity for computing the ECL. The Company uses three main components to measure ECL. These are, Exposure at default (EAD), Probability of Default (PD) and Loss Given Default (LGD).

Exposure at default (EAD) is defined as the sum of Principal outstanding and interest accrued at the reporting date.

PD is defined as the probability of borrowers defaulting on their obligations.

LGD represents the economic loss. Company uses historical loss data for identified homogenous pools for the purpose of calculating LGD. For individual cases where there has been a significant deterioration in recovery, the LGD is considered to be 100%.

Accordingly, loan assets are categorised under three different stages, as under:

Stage 1: Where instalments are Current and 1-30 days overdue Stage 2: Where instalments are 31 days - 90 days overdue and Stage 3: Where instalments are overdue beyond 90 days

The Company is required to provide 12-month Expected Credit Loss (12-month ECL) for stage 1 assets and the Life Time Expected Credit Loss (LECL) for stage 2 & stage 3 assets

12-month ECL is the expected credit loss that results from default events that are possible within 12 months after the reporting date. LECL represents the expected credit loss from default events over the expected life of a financial asset.

As prescribed under para 5.5 in Ind AS 109, 12-months PD is required to be computed for financial instruments which are in stage 1, and life time PD for those in stage 2 & 3. 12-months PD is the likelihood of the borrower defaulting in the 12 months following the reporting date while life time PD is the likelihood of the borrower defaulting during the residual tenor.

The PD model has been developed for all the major asset classes using a statistical and iterative approach. The design and construction of the model involves identification of various credit parameters and variables that have a strong and direct correlation to propensity of default. The PD model reflects to the probability of default, taking into consideration the inherent credit quality of the borrower and the residual tenor of each contract. The PD for stage 3 contracts is considered at 100%. Where a customer has one contract in stage 3 and one or more contracts in stage 1 / stage 2, the PD for all the contracts is considered at 100%.

LGD represents the economic loss, adjusted for cure rate, as a percentage of exposure at the time of default. Economic loss is the estimated shortfall in realisation of dues, in the event of default. Contracts that have turned delinquent do not necessarily involve ultimate losses, since many of them are resolved through corrective actions. The cure rate is the probability of a ''non performing'' (i.e. defaulted) contract reverting to a ''performing'' (i.e. non-default) status in a year. For individual cases where there as been a significant deterioration in recovery, the LGD is considered to be 100% for those cases.

44.1.8 Operational Risk

Operational Risk is constantly monitored as it is prevalent in every branch and department. Systematic improvements are made wherever required.

44.1.9 Compliance Risk

Based on the guidelines received from regulatory and statutory authorities and also based on the policy requirements, the compliance risks issues are identified, assessed and monitored for compliance.

44.1.10 Market Risk

The Company does not accept deposits from public. The resources are mobilized from banks and market. The Company has a specific committee named Assets and Liabilities Committee (ALCO) which meets at frequent intervals to manage the liquidity, interest rates, spread etc. The Committee also prescribes Minimum Lending Rate (MLR).

44.1.11 Interest Rate Risk

The Company is subject to interest rate risk, since the rates of loans and borrowings might fluctuate over the tenure of instrument. Interest rates are highly sensitive to many factors beyond control, including the monetary policies of the Reserve Bank of India, deregulation of the financial sector in India, domestic and international economic and political conditions, inflation and other factors. In order to manage interest rate risk, the Company seeks to optimise borrowing profile between short-term and long term loans. The liabilities are categorised into various time buckets based on their maturities and Asset Liability Management Committee supervise an interest rate sensitivity report periodically for assessment of interest rate risks

44.2 Capital Management

The Company''s capital management strategy is to effectively determine, raise and deploy capital to cover risk inherent in business and meeting the capital adequacy requirements of the Reserve Bank of India (RBI). The Company finances

45.1 Collateral and other credit enhancements

Although collateral can be an important mitigation of credit risk, it is the Company''s practice to lend on the basis of the customer''s ability to meet the obligations out of cash flow resources other than placing primary reliance on collateral and other credit risk enhancements. The Company obtains first and exclusive charge on all collateral that it obtains for the loans given. Home loans/ home equity loans are secured by collateral at the time of origination. In case of Home loans/ home equity loans, the value of the property at the time of origination will be arrived by obtaining valuation reports from Company''s empanelled valuers. Immovable Property is the collateral for Home loans/ Home Equity loans. Security Interest in favour of the Company is created by Mortgage through deposit of title deed which is registered wherever required by law. Any surplus remaining after settlement of outstanding debt by way of sale of collateral is returned to the customer / borrower.

Note 46 : Liquidity risk and funding management

Liquidity risk is defined as the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Liquidity risk arises because of the possibility that the Company might be unable to meet its payment obligations when they fall due as a result of mismatches in the timing of the cash flows under both normal and stress circumstances. Such scenarios could occur when funding needed for illiquid asset positions is not available to the Company on acceptable terms. To limit this risk, management has arranged for diversified funding sources and adopted a policy of managing assets with liquidity in mind and monitoring future cash flows and liquidity on a daily basis. The Company has developed internal control processes and contingency plans for managing liquidity risk.

The Company maintains diverse assets that are assumed to be easily liquidated in the event of an unforeseen interruption in cash flow. The Company also has lines of credit that it can access to meet liquidity needs. In accordance with the Company''s policy, the liquidity position is assessed under a variety of scenarios, giving due consideration to stress factors relating to both the market in general and specifically to the Company. Net liquid assets consist of cash and cash equivalents, balances other than cash and cash equivalents available for immediate use, less securities issued and borrowings due to mature within the next month.

As per our report of even date For and on behalf of the Board of Directors of Repco Home Finance Limited

For Chaturvedi & Co Sd/- Sd/-

Chartered Accountants Lakshmi K Ankush Tiwari

ICAI Firm Registration Number: 302137E Chief Financial Officer Company Secretary

Membership No. 215368 Membership No. A38879

Sd/- Place: Chennai Place: Chennai

S G_anesan, FCA Date: May 14, 2024 Date: May 14, 2024

Partner Sd/- Sd/-

Membership No. 217119 K Swaminathan C Thangaraju

Pl_{ace :} Ch_ennai Managing Director Chairman

DIN: 06485385 DIN: 00223383

^Date : ^{May 14}, ²⁰²⁴ Place: Chennai Place:Chennai

Date: May 14, 2024 Date: May 14, 2024

---

Mar 31, 2023

A. Refinance from National Housing Bank (NHB) and other Term Loans from banks and financial institutions are secured by first and exclusive charge on the specific book debts/receivables of the company and an irrevocable Power of Attorney (POA) given by the company in favour of the Banks/NHB for recovery of dues and for creation of mortgage on the properties of the loan borrowers of the company.

B. The Company is not a large Corporate as per the applicability criteria given under the SEBI Circular SEBI/HO/DDHS/CIR/P/ 2018/144 dated November 26, 2018.

C The repayment of the borrowings are done in monthly, quarterly, half-yearly and annual instalments as per the sanction terms

D. The Company has not made any default in repayment of instalments during the financial year

E. The borrowings have not been guaranteed by Directors or others.

F. The Company has borrowings from Banks and financial institutions on the basis of book debts and quarterly returns / statements of book debts filed with Bank are in agreement with the books of accounts.

G. There were no delay in repayment of borrowings during the financial year

H. No bank or lender has declared the Company as willful defaulter

I. The Company has taken borrowings from banks and financial institutions and utilised them for the specific purpose for which they were taken during the financial year.

d) Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

I n the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Note 18.2 : Nature and purpose of reserves

18.2.1 Securities premium reserve

Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

18.2.2 Special Reserve

As per Section 29C(i) of the National Housing Bank Act, 1987, 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. The Company has transferred an amount of Rs.68.60 Crores (Previous year Rs.72.46 Crores) to Special Reserve in terms of Section 36(1) (viii) of the Income Tax Act, 1961.

18.2.3 Statutory reserve

The Company has transferred an amount of Rs. 59.22 Crores during the year (Previous year Rs.38.31 Crores) to Statutory Reserve u/s 29C of the National Housing Bank Act, 1987.

18.2.4 General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013. During the year, the company has transferred an amount of Rs. 35 crores to General Reserve.

18.2.5 Retained Earnings

Retained earnings represents the amount of accumulated earnings of the Company.

18.2.6 Other Comprehensive Income

Other Comprehensive Income represents remeasurement of the net defined benefit liabilities comprise of actuarial gain / loss

i) For the financial year ended on March 31, 2023, the CSR projects amounting to Rs.2.06 Crores were approved and classified as ongoing projects by the Board. Accordingly, as prescribed under the Companies Act, 2013, the amount of Rs.2.06 Crores was transferred to a separate bank account opened for Unspent CSR amount within the time limit and the funds will be utilized towards the ongoing CSR projects.

ii) For the financial year ended on March 31, 2022, the CSR projects amounting to Rs.2.59 Crores were approved and classified as ongoing projects by the Board. Accordingly, as prescribed under the Companies Act, 2013, the amount of Rs.2.59 Crores was transferred to a separate bank account opened for Unspent CSR amount within the time limit and the funds were utilized towards the ongoing CSR projects to the extent of Rs.2.48 Crores during the FY 2022-23.

g) There are no related party transactions during the year ended March 31,2023 and March 31,2022 in respect of CSR activities

Note 30 : Segment information

The Company operates under the principal business segment viz."Providing loans for construction or purchase of residential property". Further, the Company is operating in a single geographical segment. The Chief Operating Decision Maker (CODM) views and monitors the operating results of its single business segment for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profits or losses and is measured consistently with operating profits or losses in the financial statements. Accordingly, disclosures relating to primary and secondary business segments under the Indian Accounting Standard on ''Segment Reporting’ (Ind AS 108) are not applicable to the Company.

Note 31 : Retirement benefit plan Note 31.1: Defined contribution plan

A Contribution towards PF is determined under the Employees’ Provident Funds & Miscellaneous Provisions Act, 1952 and charged to the Statement of Profit and Loss during the period of incurrence when the services are rendered by the employees.

The expense charged in statement of profit and loss amounting to Rs. 4.80 crores (2022: Rs.4.60 crores) represents contributions payable to these plans by the Company at rates specified in the rules of the plan.

Note 31.2: Defined benefit plan

The Company has a defined benefit gratuity plan in India (funded). The Company’s defined benefit gratuity plan is a final salary plan for India employees, which requires contributions to be made to a separately administered fund. The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the member’s length of service and salary at retirement age. The fund has the form of a trust and it is governed by the Board of Trustees.

The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and the funded status and amounts recognised in the balance sheet for the respective plans:

Salary and wages includes Rs. 3.26 crores (PY Rs. 5.71 crores) towards provision made as per actuarial valuation in respect of accumulated leave salary encashable on retirement / resignation

The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and amounts recognised in the balance sheet :

Note 32:

Pursuant to Master Direction Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 dated February 17, 2021, issued by Reserve Bank of India (RBI), the Company has prepared the various required disclosures based on Ind AS for the year ended March 31,2023 and March 31,2022.

Note 32.13 : Registration obtained from other financial sector regulators :

Registration of Company as Composite Corporate Agent with Insurance Regulatory & Development Authority has been obtained. Note 32.14 : Disclosure of Penalties imposed by NHB and other regulators

(i) During the year, the Stock Exchanges (NSE & BSE) have levied a penalty relating to non-compliance with the requirement pertaining to appointment / continuation of non executive director who has attained 75 years as per regulation 17 (1A) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 amounting to Rs. 0.02 Crores. The company has made its representation before the Stock Exchanges for withdrawal and refund of penalty and the representation is yet to be disposed of by the Stock Exchanges.

(ii) There was no penalty imposed by NHB/ RBI/ other regulators on account of contravention of certain provisions/ regulations on the Company during the years ended March 31,2023 and March 31,2022.

Note 32.15:

As per the IND AS 24 - Related Party Disclosures, details of the related parties, nature of the relationship with whom Company has entered transactions, remuneration of directors and balances in related party account at the year end, are given in Note no. 37. All transactions with related parties were carried out in ordinary course of business at arm’s length price.

Note 32.16: Group Structure

The Company''s holding structure is given in Note no.18b and the Company has investments in the equity of unlisted Associate Company, Repco Micro Finance Limited to the extent of Rs.31.60 Crores (3,16,00,000 equity shares of Rs.10/-each) in FY 2022-23 and Rs.31.60 Crores (3,16,00,000 equity shares of Rs.10/- each) in FY 2021-22.

Note 32.19 : Net Profit or Loss for the period, prior period items and changes in accounting policies

During the year,

(a) no prior period items occurred which has impact on Statement of Profit and loss,

(b) no change in Accounting policy,

(c) there were no circumstances (other than income recognition on Non performing advances ) in which revenue recognition has been postponed pending resolution of significant uncertainty except implementation of Ind- AS required by Ministry of corporate affairs and

(d) there is no withdrawal from reserve fund.

Note 32.20 : Revenue Recognition

There are no circumstances in which revenue recognition has been postponed by the Company pending the resolution of significant uncertainties. Also, refer note no.4.11 for accounting policy with respect to revenue recognition.

Note 32.21 : Consolidated Financial Statements (CFS)

The Company has no investment in subsidiaries and hence requirement of CFS involving subsidiary Company is not applicable. However, financial statement of associate company is consolidated and reported.

Note 32.34 :

There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2023. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

Note 32.35 :

Expenditure incurred in foreign currency: Towards Travelling Expenses - Nil (March 31, 2022 - Nil) and towards other borrowing costs - Nil (March 31,2022 - Nil). There are no Earnings in foreign currency during the current year as well as in the previous year.

Note 32.36 :

Amount of Rs. 23,350/- was paid to Investor Education and Protection Fund during the year ended March 31,2023 (March 31,2022 Nil).

Note 32.37 :

Pursuant to Master Direction Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 dated February 17, 2021 which inter-alia includes guidelines on monitoring of frauds in NBFCs, the company has reported 8 fraudulent cases (PY - 11 fraudulent cases) to NHB. The Amount related to fraud is Rs. 3.85 Crores (PY - 2.49 Crores). All efforts are being made to recover the maximum amount possible.

Note 32.40 : Gold loan

The Company does not provide any loans on collateral of gold and gold jewelleries.

Note 32.41:

There has been no divergence in asset classification and provisioning requirements as assessed by NHB during the year ended March 31,2023 and March 31,2022.

(vi) Institutional set-up for liquidity risk management

The Company has put in place a well-defined Risk Management Policy which includes Liquidity Risk Management policy and Contingency Funding plan to manage and monitor Liquidity risk of the Company efficiently and to report the Board on the effectiveness of the same. The Company has an Asset Liability Management Committee (ALCO) headed by the MD & CEO and its members Chief Operating Officer (COO), Chief Development Officer (CDO), Chief General Manager (CGM), Chief Technology Officer (CTO), Chief Financial Officer (CFO), Chief Risk Officer (CRO) and DGM Finance. The ALCO is a decision-making unit responsible for integrated balance sheet management from risk-return perspective including the strategic management of interest rate and liquidity risks. The ALCO monitors the liquidity risk by ensuring judicious mix of assets and liabilities so as to reduce mismatch in the ALM and also monitors the implementation of the Liquidity Risk Management tools prescribed in the Liquidity Risk Management Policy of the Company. The outcomes of ALCO are promptly reported to the Risk Management Committee of the Board and to the Board of Directors at regular intervals.

Note 35:

Disclosure pursuant to RBI notification no. RBI/2020-21/60 DOR.NBFC (HFC).CC.No.118/03.10.136/2020-21 dated October 22, 2020 and RBI/2019-20/170 DOR (NBFC).CC.PD.No.109/22.10.106/2019-20 dated March 13, 2020 on Implementation of Indian Accounting Standards.

As required by the RBI Notification no. RBI/2020-21/60 DOR.NBFC (HFC).CC.No.118/03.10.136/2020-21 dated October 22, 2020, the Company has complied with the requirements of Ind AS and the Guidelines and Policies approved by the Board in recognition of impairment of financial instruments. The overall impairment loss allowance as at March 31,2023 and March 31,2022 made under Ind AS is higher than the prudential floor prescribed by RBI/NHB.

Notes:

* Unweighted values calculated as outstanding balances maturing or callable within 30 days (for inflows and outflows)

** Weighted values calculated after the application of respective haircuts (for HQLA) and stress factors on inflow (75%) and outflow (115%)

*** Components of HQLA are Current account balances with banks, Unpaid dividend accounts, Short-term deposits and cash on hand

i) Disclosure on Liquidity Coverage Ratio (LCR) of Repco Home Finance Company Limited as on March 31,2023 in accordance with RBI circular No. RBI/2020-21/73 DOR.FIN. HFC.CC. No.102 /03.10.136/2020-21 dated February 17, 2021 and RBI circular No. RBI/DNBR/2016-17/45 Master Direction DNBR.PD.008/ 03.10.1 19/ 2016-17 dated September 01, 2016. The RBI vide Circular No. RBI/2020-21/73DOR.FIN.HFC.CC.No. 120/03.10.136/2020-21 dated February 17, 2021 issued guidelines on maintenance of Liquidity Coverage Ratio (LCR) for HFCs.

ii) The Company had average LCR of 107.90% as of March 31,2023 and 81.58% as of December 31,2022, as against the LCR of 60% mandated by RBI. The Company regularly reviews the maturity position of assets and liabilities and liquidity buffers, and ensures maintenance of sufficient quantum of High Quality Liquid Assets.

Note 39 : Contingent liabilities and commitments
Particulars	March 31, 2023	March 31, 2022
i) Claims against the company not acknowledged as debts	14.91	14.91
ii) Disputed Income tax Liability	2.94	0.43
iii) Commitment towards sanction pending disbursement including part disbursement	472.47	407.78
iv) Pending capital commitment	0.20	0.20

The Company has lease contracts for Land and Building used for the branches. Leases of such assets generally have lease terms between 1 and 12 years. The Company’s obligations under its leases are secured by the lessor’s title to the leased assets. There is no revaluation of ROU assets during the year or previous year.

ii) Maturity Analysis of Lease Liabilities

Given below are the undiscounted potential future rental contractual payments for the lease contracts existing as at Reporting period

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e., an exit price), regardless of whether that price is directly observable or estimated using a valuation technique.

In order to show how fair values have been derived, financial instruments are classified based on a hierarchy of valuation techniques. Note 44.2: Valuation governance

The Company’s fair value methodology and the governance over its models includes a number of controls and other procedures to ensure appropriate safeguards are in place to ensure its quality and adequacy. All new product initiatives (including their valuation methodologies) are subject to approvals by various functions of the Company including the risk and finance functions. The responsibility of ongoing measurement resides with the business units. Once submitted, fair value estimates are also reviewed and challenged by the Risk and Finance functions.

Note 44.3: Valuation methodologies of financial instruments not measured at fair value

Below are the methodologies and assumptions used to determine fair values for the above financial instruments which are not recorded and measured at fair value in the company’s financial statements. These fair values were calculated for disclosure purposes only. The below methodologies and assumptions relate only to the instruments in the below tables

Loans and advances to customers

The fair values of loans and receivables are estimated by discounted cash flow models that incorporate assumptions for credit risks, probability of default and loss given default estimates. Where such information is not available, the company uses historical experience and other information used in its collective impairment models.

Fair values of lending portfolios are calculated using a portfolio-based approach. The company then calculates and extrapolates the fair value to the entire portfolio, using discounted cash flow models that incorporate interest rate estimates considering all significant characteristics of the loans. The credit risk is applied as a top-side adjustment based on the collective impairment model incorporating probability of defaults and loss given defaults.

45.1 Introduction and risk profile

Company has operations in India. As the company is in financial sector, the risks associated with this type of business is integral part of the management. The company deals with large number of customers and is involved in long term lending. Hence, the risks to this type of business is unique and requires focused attention. Further, the management of risk is continuous and on going process and needs to be dynamic. The company is aware that risk is proportionate to the expected returns but should have limitations in exposing itself to the risks. This process of risk management is critical to the company’s continuing profitability and reputation in the market. The company is generally exposed to credit risk, market risk, operational risk, compliance risk, reputational risk and Competition risk.

45.1.1 Risk management structure

The Company has in place a Risk Management Policy duly approved by the Board covering various aspects of the risk management. Board of Directors are responsible for effective risk management. It oversees and reviews the overall functioning of the risk management and provide necessary directions in this regard.

The Management and Risk Management Committee of the Board (MRMC) is Board level committee entrusted with overseeing implementation of the Risk Management Policy / strategy approved by the Board. The Company has since formed an exclusive Risk Management Committee of the Board (RMCB) to deal with risk management in an efficient and effective manner. The committee reviews the functioning of the risk management framework at periodical intervals. It reviews the reports and directs for taking mitigating steps. The committee reports the status of the risk management of the company to the Board at periodical intervals through minutes of the meeting of the committee. The minutes of the committee are placed before the Board.

Credit and Operational Risk Management Committee (CORMC) is an executive level committee headed by Managing Director (MD) as Chairman of the Committee, having members viz., Chief Operating Officer (COO), Chief Development Officer (CDO), Chief General

Manager (CGM), Chief Financial Officer (CFO), Chief Technology Officer (CTO), all the General Managers, DGM Finance, Compliance Officer. It is responsible for laying down the operational guidelines and monitor and mitigate the credit and operational risks the company is facing. This Committee periodically reviews the portfolio studies, Risk and Control Self-Assessment studies conducted at branches, monitor various Key Risk Indicators (KRI), etc. and provide necessary mitigations. It also reviews and recommends the Risk Management Committee of the Board (RMCB) the amendments to Risk Management Policy, as and when considered necessary. The minutes of this committee is placed before Risk Management Committee of the Board (RMCB). Besides this, Assets and Liabilities Management Committee (ALCO) addresses the market and liquidity risks.

The Risk Management Department'' in Corporate Office of the company is responsible for Identification, measurement, monitoring and taking steps for mitigation of operational, credit and compliance risk and reporting to top management and the committees concerned.

The Chief Risk Officer (CRO) is designated as ''Risk Manager'' of the company who is responsible for coordination, overseeing and implementation of the requirements identified in the Risk Management Policy.

45.1.2 Risk Identification

The Company has identified risk issues in various functions such as branches, departments in Corporate Office, Regional Offices, Central Depository, etc. and prepared a Risk Register. The register contains more than one thousand risk issues relating to various types of risks. This register is dynamic as it gets updated by additions and deletions as and when new guidelines are issued. Further, each risk is categorised as ''''Operational Risk", “Credit Risk", "Market Risk", “Compliance Risk or ''''Competition Risk".

45.1.3 Risk measurement

The risk issues identified and recorded in the Risk Register are measured based on the impact it may have on the business if the company is exposed to such risks. Based on the velocity of impact each risk is categorised as ''High'', ''Medium'' and ''Low'' risk. This is done to decide the quantum of focus required in

respect of each risk issue. Weightage is given for each risk issue to enable the company to measure the risk. The company gives focus on ''High'' risk issues for better management.

45.1.4 Risk Monitoring

The frequency for monitoring each risk issue is prescribed. Accordingly, the risk issues are grouped as "Quarterly", "Half-yearly" and "Annual". Such grouped issues are taken up for assessment at the prescribed intervals.

45.1.5 Risk Assessment methodology

The risk is assessed based on self assessment by the owners of risk at the prescribed intervals. Each risk issue has to be assessed by the owners of the risk and provide a certification. The certificate is subject to verification by Risk Management Department and by Internal Auditors. Accordingly, each branch assesses the level of compliance in respect of each risk issue and provides a certificate. For this purpose, a software utility has been provided to each branch, departments in Corporate Office (CO), regional offices and Central depository (CDR). This exercise is done every quarter.

45.1.6 Measurement of Risk

Based on the Self -assessment certifications from various risk owners, the quantum of risk that are reported by the owners are calculated for various categories of risks such as credit risk, operational risk, compliance risk and competition risk. Risk is also measured in terms of high, medium and low. This would help the Company to arrive at the direction of risk.

45.1.7 Credit risk

The Company is primarily in the business of lending and hence is exposed to credit risk. Various credit risk mitigations are provided in the Credit Policy of the company such as profiling each customer based on various factors of the borrower and linking pricing to the same. The internal rating of each borrower is done as a part of appraisal to arrive at the risk. The Credit risk issues are identified by the Risk Management Department and provided to the branches and Credit Department for assessment. Mitigation steps are taken immediately to manage the risk. Immediate action is initiated by way of SARFAESI, OTS, etc to recover the impaired credit.

Assets possessed under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002:

Loan Portfolio includes gross loans amounting to Rs.48.13 Crores (31 March 2022: Rs.50.07 Crores) against which the Company has taken possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. The value of assets possessed against these loans is Rs. 60.94 Crores (31 March 2022:: Rs.79.13 Crores).

Restructuring of accounts

The economic fallout on account of COVID-19 pandemic has led to significant financial stress for many borrowers. Considering the above, with the intent to facilitate revival and to mitigate the impact on ultimate borrowers, Reserve Bank of India (RBI) introduced measures under the Resolution Framework for COVID-19. As per the RBI Framework, the Corporation established a policy to provide resolution for eligible borrowers having stress on account of COVID-19 in line with the RBI Guidelines.

As advised under the said circular and Company’s policy, the eligibility of customers was assessed, so as to understand the extent of financial stress caused due to COVID-19, i.e. delay in construction, sales and consequent cash flow mismatch, duly supported by the documentary evidence. In addition to assessing the impact of stress, the Resolution framework was discussed with the eligible borrower prior to invocation of Resolution plan. The Resolution Framework offered to ensure that the servicing of the restructured loan is not likely to be impacted.

Moratorium

The RBI had announced Moratorium for 6 months on repayments for the period March 2020 to August 2020 for term loans and working capital facilities outstanding as on February 29, 2020. This was part of the regulatory measures adopted to mitigate the burden of debt servicing brought about by disruptions on account of Covid pandemic and to ensure continuity of viable businesses. As part of the scheme and as per Company’s Board approved policy, the Company has provided moratorium to eligible borrowers.

45.1.7.1 The company''s internal grading

The company’s independent Credit Risk Department operates its internal rating models. The company runs separate models for its key portfolios in which its customers are categorised as high, medium and low grade. The models incorporate both qualitative and quantitative information and, in addition to information specific to the borrower, utilise supplemental external information that could affect the borrower’s behaviour. Loan assets are graded based on repayment behaviour of the customer of last 12 months.

45.1.7.2 Impairment - Expected credit loss (ECL)

The application of Ind AS 109 has necessitated fundamental changes to the accounting for expected default risk (risk provisioning). Specifically, the incurred loss model has been replaced by the Expected Credit Loss model (ECL). Consequent to this change, the Expected Credit losses on financial instruments are classified under three stages.

Stage 1: Every financial asset is classified as stage 1, upon

initial recognition. In addition, stage 1 contains all transactions with limited default risk.

Stage 2: Financial assets whose default risk has risen

significantly since initial recognition and which are not classified as cases with limited default risk.

Stage 3: Financial assets that display objective evidence of

impairment at the reporting date.

The accounting standard, Ind AS 109 does not specifically prescribe any methodology for computing ECL. However, entities are required to adopt sound and market acceptable methodologies which are in line with the size, complexity and risk-profile of the financial entity for computing the ECL. The Company uses three main components to measure ECL. These are, Exposure at default (EAD), Probability of Default (PD) and Loss Given Default (LGD).

Exposure at default (EAD) is defined as the sum of Principal outstanding and interest accrued at the reporting date.

PD is defined as the probability of borrowers defaulting on their obligations.

LGD represents the economic loss. Company uses historical loss data for identified homogenous pools for the purpose of calculating LGD. For individual cases where there as been a significant deterioration in recovery, the LGD is considered to be 100%.

Accordingly, loan assets are categorised under three different stages, as under:

Stage 1: Where instalments are Current and 1-30 days

overdue

Stage 2: Where instalments are 31 days - 90 days overdue

and

Stage 3: Where instalments are overdue beyond 90 days

The company is required to provide 12-month Expected Credit Loss (12-month ECL) for stage 1 assets and the Life Time Expected Credit Loss (LECL) for stage 2 & stage 3 assets

12-month ECL is the expected credit loss that results from default events that are possible within 12 months after the reporting date. LECL represents the expected credit loss from default events over the expected life of a financial asset.

As prescribed under para 5.5 in Ind AS 109, 12-months PD is required to be computed for financial instruments which are in stage 1, and life time PD for those in stage 2 & 3. 12-months PD is the likelihood of the borrower defaulting in the 12 months following the reporting date while life time PD is the likelihood of the borrower defaulting during the residual tenor.

The PD model has been developed for all the major asset classes using a statistical and iterative approach. The design and construction of the model involves identification of various credit parameters and variables that have a strong and direct correlation to propensity of default. The PD model reflects to the probability of default, taking into consideration the inherent credit quality of the borrower and the residual tenor of each contract. The PD for stage 3 contracts is considered at 100%.

Where a customer has one contract in stage 3 and one or more contracts in stage 1 / stage 2, the PD for all the contracts is considered at 100%.

LGD represents the economic loss, adjusted for cure rate, as a percentage of exposure at the time of default. Economic loss is the estimated shortfall in realisation of dues, in the event of default. Contracts that have turned delinquent do not necessarily involve ultimate losses, since many of them are resolved through corrective actions. The cure rate is the probability of a ''non performing’ (i.e. defaulted) contract reverting to a ''performing’ (i.e. non-default) status in a year. For individual cases where there as been a significant deterioration in recovery, the LGD is considered to be 100% for those cases.

45.1.8 Operational Risk

Operational Risk is constantly monitored as it is prevalent in every branch and department. Systematic improvements are made wherever required.

45.1.9 Compliance Risk

Based on the guidelines received from regulatory and statutory authorities and also based on the policy

requirements, the compliance risks issues are identified, assessed and monitored for compliance.

45.1.10 Market Risk

The Company does not accept deposits from public. The resources are mobilized from banks and market. The Company has a specific committee named Assets and Liabilities Committee (ALCO) which meets at frequent intervals to manage the liquidity, interest rates, spread etc. The Committee also prescribes Minimum Lending Rate (MLR).

45.1.11 Interest Rate Risk

The Company is subject to interest rate risk, since the rates of loans and borrowings might fluctuate over the tenure of instrument. Interest rates are highly sensitive to many factors beyond control, including the monetary policies of the Reserve Bank of India, deregulation of the financial sector in India, domestic and international economic and political conditions, inflation and other factors. In order to manage interest rate risk, the Company seeks to optimise borrowing profile between short-term and long term loans. The liabilities are categorised into various time buckets based on their maturities and Asset Liability Management Committee supervise an interest rate sensitivity report periodically for assessment of interest rate risks.

The Company’s capital management strategy is to effectively determine, raise and deploy capital to cover risk inherent in business and meeting the capital adequacy requirements of the Reserve Bank of India (RBI). The Company finances its operations by a combination of retained profit and bank borrowings. The Company determines the amount of capital required on the basis of operations and capital expenditure. The adequacy of the Company''s capital is monitored using, among other measures, the regulations issued by the RBI.

The capital structure is monitored on the basis of net debt to equity and maturity profile of overall debt portfolio. The Company''s policy is in line with Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 which currently permits HFCs to borrow up to 12 times of their net owned funds (""NOF""). Refer Note 32.1 for Capital to risk weighted assets ratio (CRAR).

Loan Covenants

There were few breach of loan covenants during the year for facilities availed from lenders. However, the company has concluded that these loan covenants are not substantive in nature based on specific facts and circumstances applicable to it. Accordingly, the company has obtained waiver from the lenders with respect to these breaches.

Note 46 : Analysis of risk concentration

The Company’s concentrations of risk ( for financial assets other than loans and advances ) are managed by industry sector. The following table shows the risk concentration by industry for the financial assets of the Company:

Although collateral can be an important mitigation of credit risk, it is the Company’s practice to lend on the basis of the customer’s ability to meet the obligations out of cash flow resources other than placing primary reliance on collateral and other credit risk enhancements. The Company obtains first and exclusive charge on all collateral that it obtains for the loans given. Home loans/ home equity loans are secured by collateral at the time of origination. In case of Home loans/ home equity loans, the value of the property at the time of origination will be arrived by obtaining valuation reports from Company’s empanelled valuer. Immovable Property is the collateral for Home loans/ Home Equity loans. Security Interest in favour of the Company is created by Mortgage through deposit of title deed which is registered wherever required by law. Any surplus remaining after settlement of outstanding debt by way of sale of collateral is returned to the customer / borrower.

Note 47 : Liquidity risk and funding management

Liquidity risk is defined as the risk that the company will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Liquidity risk arises because of the possibility that the company might be unable to meet its payment obligations when they fall due as a result of mismatches in the timing of the cash flows under both normal and stress circumstances. Such scenarios could occur when funding needed for illiquid asset positions is not available to the company on acceptable terms. To limit this risk, management has arranged for diversified funding sources and adopted a policy of managing assets with liquidity in mind and monitoring future cash flows and liquidity on a daily basis. The company has developed internal control processes and contingency plans for managing liquidity risk.

The company maintains diverse assets that are assumed to be easily liquidated in the event of an unforeseen interruption in cash flow. The company also has lines of credit that it can access to meet liquidity needs. In accordance with the company’s policy, the liquidity position is assessed under a variety of scenarios, giving due consideration to stress factors relating to both the market in general and specifically to the company. Net liquid assets consist of cash and cash equivalents, balances other than cash and cash equivalents available for immediate use, less securities issued and borrowings due to mature within the next month.

The table below shows an analysis of assets and liabilities analysed according to when they are expected to be recovered or settled, based on contractual maturities. With regard to loans and advances to customers, the company uses the same basis of expected repayment behaviour as used for estimating the EIR.

Note 48 Disclosure on scheme for grant of exgratia

During the previous year, the Government of India, Ministry of Finance, vide its notification dated October 23, 2020, had announced COVID-19 Relief Scheme for grant of ex-gratia payment of difference between compound interest and simple interest for six months to borrowers in specified loan accounts (“the Scheme"), as per the eligibility criteria and other aspects specified therein and irrespective of whether the moratorium was availed or not. The Company had implemented the Scheme and credited an amount to the eligible borrowers loan account as per the Scheme and during the current year, Company has received reimbursement from SBI - Nodal office in accordance with the relief scheme.

a) No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

b) The Company has not been declared as a wilful defaulter by any bank or financial institution or government or any government authority.

c) As per the information available with the Company, the Company has no transactions with the companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.

e) As a part of normal lending business, the company grants loans and advances on the basis of security / guarantee provided by the Borrower/ co-borrower. These transactions are conducted after exercising proper due diligence. Other than the transactions described above,

1) No funds have been advanced or loaned or invested by the Company to or in any other person(s) or entity(ies) including foreign entities ("Intermediaries") with the understanding that the Intermediary shall lend or invest in a party identified by or on behalf of the Company (Ultimate Beneficiaries);

2) No funds have been received by the Company from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly, lend or invest in other persons or entities identified by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

f) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year ended March 31,2023.

g) There are no transactions relating to previously unrecorded income that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.

h) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company w.e.f. April 01,2023.

Note 51

Pursuant to RBI circular dated November 12, 2021 “Prudential norms on Income Recognition, Asset Classification and Provisioning (IRAC) pertaining to Advances - Clarifications", the Company has changed its NPA definition to comply with the norms / changes for regulatory reporting, as applicable. The Company has also on the basis of prudence, aligned Stage-3 definition to revised NPA definition. This has resulted in classification of loans amounting to Rs. 24.85 Crores as Non Performing Assets (Stage-3) as at March 31,2023 in accordance with the regulatory requirement. The Company has accordingly made adequate ECL provision for the quarter and year ended March 31,2023.

54.1 The Company has regrouped the Cash Flow Statement for better presentation and in compliance with Ind AS 7 - Statement of Cash Flows.

Note 55 :

The Company is in compliance with number of layers of Companies, as prescribed under clause (87) of Section 2 of the Act read with Companies (restriction on number of layers) Rules, 2017.

Note 56: Events after reporting date

There have been no events after the reporting date that require disclosure in these financial statements.

Note 57: Approval of financial statements

The financial statements were approved for issue by the Board of Directors on August, 04, 2023.

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Mar 31, 2018

BASIS OF ACCOUNTING AND PREPARATION OF FINANCIAL STATEMENTS

The financial statements of the company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 and the Companies (Accounting Standards) Rules, 2016 (as amended). The financial statements have been prepared on an accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

The Company follows the applicable guidelines and directions, including prudential norms for income recognition, asset classification and provisioning as prescribed by the National Housing Bank (“NHB”).

Contingent Liabilities not provided for:-

1.1 (i) Claims against the Company not acknowledged as debts Rs. 0.21 crore (March 31, 2017- Rs.0.21 crore)

(ii) Disputed Income tax Liability Rs.7.33 crore (March 31 2017- Rs. 5.48 crore)

1.2 Commitment towards sanction pending disbursement including part disbursement as on March 31, 2018 - Rs. 486.91 crore (March 31, 2017- Rs. 381.46 crore).

1.3 Pending Capital Commitments: Pending capital commitments as on March 31, 2018 is Rs.0.55 crore (March 31, 2017-Rs.0.25 crore).

1.4 The following disclosures have been given in terms of the National Housing Bank’s notification no. NHB.HFC.CG-DIR.1/ MD&CEO/2016 dated February 9, 2017: 25.4.4

Derivatives -NIL

Forward rate agreement (FRA) / Interest rate swaps (IRS) - NIL Exchange traded interest rate (IR) Dreivative - NIL Disclosure on Risk exposure in Derivatives - NA

1.4.1 Securitisaion - NIL

Details of Financial Assets sold to Securitisation / Reconstruction Company for Asset Reconstruction - NA Details of Assignment transactions undertaken by HFCs - NA Details of non-performing financial assets purchased / sold - NA

1.4.2. Details of financing of parent company products : NIL

1.4.3. Details of Single Borrower Limit (SGL) / Group Borrower Limit (GBL):

The company has not exceeded limit prescribed by National Housing Bank for Single Borrower Limit (SGL) and Group Borrower Limit (GBL).

1.4.4. Unsecured Advances:

The Company has not financed against intangible securities such as rights, licenses, authority etc as collateral security.

1.4.5. Registration obtained from other financial sector regulaors :

The Company has not obtained registration from any other financial sector regulator.

1.4.6. Disclosure of Penalities imposed by NHB and other regulators :

Based on inspection observations made by the NHB, with reference to the position as of 31-03-2016, the Company has recalculated Net Owned Fund (NOF) and Capital Adequacy Ratio (CAR) as at 31-03-2016. The reported and revised NOF/CAR as at 31-03-2016 along with impact are given below-

The difference was attributed to additional provisioning due to reclassification of advances, reversal of interest income, netting the provisions created towards standard advances and consequent assignment of risk-weights. Pursuant to the inspection observations with reference to the financial position of the Company as at 31-03-2016, National Housing Bank levied penalty aggregating to Rs.35,000/- and GST thereon, with respect to the contraventions on (i) Income Recognition (Para-22); (ii) Assets Classification (Para-27); (iii) LTV Norms (Para-27A) (iv) Assigning wrong risk-weight resulting in incorrect CAR computation (Para-30); (v) Shortfall in Provisioning ( Para-28) of the Housing Finance Companies (NHB) Directions 2010 and also (vi) disbursement of loans on the property for which the approved plan was not available (Policy Circular No.18) (vii) Guidelines on Fair Practices Code.

1.4.7 Related Party Transactions:

(a) Disclosures in terms of Accounting Standard 18 “Related Party Disclosure” (AS 18) are given below:-List of related parties:

Repco Bank Ltd., Promoter

Repco Micro Finance Ltd., Associates

Key Management Personnel

Shri R. Varadarajan Managing Director

Shri I? Natarajan Executive Director(upto 31.08.2016)

Shri V Raghu Executive Director (upto 31.05.2017)

Shri K. Ashok Executive Director (upto 31.10.2017)

Shri T. Karunakaran Chief Financial Officer

Shri K. Prabhu Company Secretary and Compliance Officer The Company’s related party balances and transactions are summarized as follows:

1.4.8 Net Profit or Loss for the period, prior period items and changes in accounting policies:

During the year (a) no prior period items occurred which has impact on Statement of Profit and loss, (b) no change in Accounting policy, there were no circumstances (other than income recognition on Non performing advances) in which revenue recognition has been postponed pending resolution of significant uncertainty and there is no withdrawal from reserve fund.

1.4.9 Revenue Recognition

There are no circumstances in which revenue recognition has been postponed by the Company pending the resolution of significant uncertainties.

1.4.10 Consolidated Financial Statements (CFS)

RHFL has no subsidiary Company, hence requirement of CFS involving subsidiary Company is not applicable. However asscoiate’s financials is consolidated and reported.

Note:

1. The Company’s policy is to provide provisions towards NPA as per NHB guidelines. However by way of prudence and abundant caution, Company has provided additional provision over and above the NHB guidelines and has maintained cumulative NPA provision of Rs.157.17 crores (March 31, 2017 - Rs. 110.11 crores)

2. The total outstanding amount mean principal accrued interest other charges pertaining to loans

3. The Category of Doubtful Assets will be as under:

1.4.11 Draw Down from Reserves

Not applicable since the company has not drawn down any amount from reserves in the current year as well as previous year.

Concentration of Public Deposits, Advances, Exposures and NPAs.

1.4.12 Concentration of Public Deposits (for Public Deposit taking/holding HFCs):

Not applicable, since the company has not accepted any deposits from the public.

1.4.13 Overseas Assets : The company does not have any overseas assets.

1.4.14 Off-balance sheet SPVs sponsord (which are required to be consolidated as per accounting norms):

The company does not have any off balance sheet Special Purpose Vehicle (SPV) which requires to be consolidated as per accounting norms.

Disclosure of Compliants (As certified by the management)

1.5 In the opinion of the Board, all Assets other than Fixed Assets and Non current Investments have a realizable value in the Ordinary course of business which is not different from the amount at which it is stated with the exception of Non performing advances for which requisite provision has been made in accordance with the NHB Guidelines.

1.6 There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2018. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

1.7 Expenditure incurred in foreign currency: Towards Travelling Expenses - Rs. 0.004 crore (March 31, 2017 -Rs.0.04 crore) and Towards Other borrowing costs - Rs.2.82 crore (March 31, 2017 - Nil) . There are no Earnings in foreign currency during the current year as well as in the previous year.

1.8 There are no amounts to be reflected under payable to Investor Protection Fund.

1.9 In accordance with the Accounting Standard on ‘Leases’ (AS 19), the following disclosure in respect of operating leases are made:

The Company has taken retail office premises under operating lease/ leave and license agreements for a period ranging upto 120 months. These are generally cancellable and have no specific obligation for renewal. The total lease payments for current year amounts to Rs.7.41 crores (March 31, 2017 - Rs.6.22 crores) which is recognised in the Statement of Profit and Loss under ‘Rent Expenses’ under note 23.

Segment reporting-

1.10 The main business of the Company is to provide long term loan financing for acquisition / construction of Residential purposes in India. Accordingly, there is no separate reportable segment as per Accounting Standard -AS-17 “Segment Reporting”, as the company has only one Geographical and Business segment.

1.11. EMPLOYEE BENEFITS

i. Defined Contribution Plan:

Company Contribution to

i. Provident fund : Rs. 2.77 Crores (March 31, 2017- Rs. 2.53 Crores)

1.12. Employee Stock Option Scheme-2013 (ESOP-2013):

During the year 2013-14 the Company instituted Employee Stock Option Scheme 2013 (ESOP-2013). The Board of Directors and the share holders approved the scheme during the year 2013-14. As on 31-03-2016 the company has following Employee stock options schemes, the features of the same are as follows:

The Company has adopted the intrinsic value method in accounting for employee cost on account of ESOP Based on such valuation, the difference between the Market price on the date of grant and exercise price is accounted as Deferred Employee compensation cost and the same is amortized over the vesting period. Accordingly sums aggregating to Rs. Nil/- (March 31, 2017- Rs. 4,81,66,267/-) is recognized as expenses on employee stock option scheme.

The Black-Scholes Model have been used to derive the estimated value of the stock option granted, if the fair value method to account for the employee share based payment plans were to be used. The estimated value of each stock options and the parameters used for deriving the estimated value of stock option granted under the Black-scholes Model is as follows:

Had the compensation cost for the stock options granted under ES0S-2013 (Tranche- I) and ESOS - 2013 (Tranche - II) been determined on fair value approach, the company’s profit after tax and earnings per share would have been as per pro-forma amount indicate below:

1.13 Expenditure towards Corporate Social responsibility:

The gross amount required to be spent by the company during the year 2017-18 as CSR expenditure under section 135 of the Companies Act of 2013 is Rs.4.53 Crores/-(March 31, 2017-Rs. 3.73 Crores) . The amount is required to be spent on activities qualifying as CSR expenditure as per schedule VII of the Companies Act 2013.

During the financial year 2017-18 the company has spent sums aggregating to Rs.0.14 crore (Rs.0.19 crore) towards CSR activities. The details of disclosure as per the Guidance issued by the Institute of Chartered Accountants of India is as follows:-

(a) Gross amount required to be spent by the Company during the year Rs.4.53 Crores/-

1.14 The figures of the previous year have been audited by a firm of chartered accountants other than S.R. Batliboi & Associates LLP. Previous year’s figures have been regrouped / reclassified wherever necessary to correspond with the current year classification / presentation.

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Mar 31, 2017

NOTE 23

NOTES ON ACCOUNTS

1) Contingent Liabilities not provided for:-

i) Claims against the Company not acknowledged as debts Rs.0.21 crore (Rs.0.21 crore)

ii) Disputed Income tax Liability Rs.5.48 crore ( Rs. 6.18 crore) .

2) Commitment towards sanction pending disbursement including part disbursement as on 31-03-2017 - Rs.381.46 crore (Rs. 370.19 crore).

3) Pending capital commitments as on 31st March 2017 is Rs. 0.25 crore (Rs. 1.94 crore).

4) The following disclosures have been given in terms of the National Housing Bank''s notification no. NHB.HFC.CG-DIR.1/ MD&CEO/2016 dated February 9, 2017:

5. Details of financing of parent company products : NIL

6. Details of Single Borrower Limit (SGL) / Group Borrower Limit (GBL): The company has not exceeded limit prescribed by National Housing Bank for Single Borrower Limit (SGL) and Group Borrower Limit (GBL).

7. Unsecured Advances:

The Company has not financed against intangible securities such as rights, licenses, authority etc as collateral security.

MISCELLANEOUS

8. Registration obtained from other financial sector regulators :

The Company has not obtained registration from any other financial sector regulator.

9. Disclosure of Penalties imposed by NHB and other regulators :

During the year National Housing Bank (NHB) has conducted inspection with reference to the position as on 3103-2016. Observations arising out of the above inspection was communicated to the Company by NHB vide letter dated 07-04-2017. Company submitted reply to NHB observations and response from NHB is awaited as on date. No penalty has been imposed by NHB during the year.

10. Related Party Transactions:

(a) Disclosures in terms of Accounting Standard 18 "Related Party Disclosure" (AS 18) are given below:-

List of related parties:

Promoter Associates

Repco Bank Ltd., Repco Micro Finance Ltd.,

Key Management Personnel

Shri R. Varadarajan Managing Director

Shri I? Natarajan Executive Director(up to 31.08.2016)

Shri V. Raghu Executive Director

Shri K. Ashok Executive Director (From 01.12.2016)

Shri T. Karunakaran Chief Financial Officer

Shri K. Prabhu Company Secretary and Compliance Officer

The Company''s related party balances and transactions are summarized as follows:

Remuneration paid to Key Management Personnel:

11. Net Profit or Loss for the period, prior period items and changes in accounting policies:

During the year (a) no prior period items occurred which has impact on Statement of Profit and loss, (b) no change in Accounting policy, (c) there were no circumstances (other than income recognition on Non performing advances) in which revenue recognition has been postponed pending resolution of significant uncertainty and (d) there is no withdrawal from reserve fund

12. Consolidated Financial Statements (CFS)

RHFL has no subsidiary Company, hence requirement of CFS involving subsidiary Company is not applicable. However associate’s financials is consolidated and reported.

Additional Disclosures:

Note:

13. The Company''s policy is to provide provisions towards NPA as per NHB guidelines. However by way of prudence and abundant caution, Company has provided additional provision over and above the NHB guidelines and has maintained cumulative NPA provision of Rs.110.11 crores (PY Rs.64.10 crores)

14. The total outstanding amount mean principal accrued interest other charges pertaining to loans

Concentration of Public Deposits, Advances, Exposures and NPAs.

15 Concentration of Public Deposits ( for Public Deposit taking/holding HFCs): Not applicable, since the company has not accepted any deposits from the public.

16 Overseas Assets : The company does not have any overseas assets.

17 Off-balance sheet SPVs sponsord (which are required to be consolidated as per accounting norms) : The company does not have any off balance sheet Special Purpose Vehicle (SPV) which requires to be consolidated as per accounting norms.

Disclosure of Complaints (As certified by the management)

18 In the opinion of the Board, all Assets other than Fixed Assets and Noncurrent Investments have a realizable value in the Ordinary course of business which is not different from the amount at which it is stated with the exception of Non performing advances for which requisite provision has been made in accordance with the NHB Guidelines.

19 There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2017. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

20 Expenditure incurred in foreign currency: Towards Travelling Expenses - Rs.0.04 crore (Rs.0.13 crore ). There are no Earnings in foreign currency during the current year as well as in the previous year.

21 There are no amounts to be reflected under payable to Investor Protection Fund.

22. In accordance with the Accounting Standard on ''Leases'' (AS 19), the following disclosure in respect of operating leases are made :

The Company has taken retail office premises under operating lease/ leave and license agreements for a period ranging up to 120 months. These are generally cancellable and have no specific obligation for renewal. The total lease payments for current year amounts to Rs.6.22 crores (Previous year Rs.5.65 crores) which is recognized in the Statement of Profit and Loss under ''Rent Expenses'' under note 21.

The Central Government in consultation with National Advisory Committee of Accounting Standards vide notification dated March 30, 2016 and circular no. 04/2016 dated April 27, 2016 had amended Companies (Accounting Standards) Rules, 2006 (''principal rules''). According to Companies (Accounting Standards) Amendment Rules, 2016, the Company has not appropriated proposed dividend of ''Rs. 12.51 crores and Tax thereon of '' Rs.2.55 crores from Statement of Profit and Loss for the year ended March 31, 2017. (Refer Para 8.5 of AS - 4 Contingencies and Events occurring after Balance Sheet date). Accordingly, the proposed dividend and tax thereon are not recognized as liability at the year end. Due to such change, Current Liability is lower by ''Rs.15.06 crores and Reserves and Surplus is higher to that extent. However, the same will be recognized as liability on approval of shareholders at ensuing Annual General Meeting.

The Company has adopted the intrinsic value method in accounting for employee cost on account of ESOP Based on such valuation, the difference between the Market price on the date of grant and exercise price is accounted as Deferred Employee compensation cost and the same is amortized over the vesting period. Accordingly sums aggregating to Rs.Nil/- (Rs. 4,81,66,267/-) is recognized as expenses on employee stock option scheme.

23. Expenditure towards Corporate Social responsibility:

The gross amount required to be spent by the company during the year 2016-17 as CSR expenditure under section 135 of the Companies Act of 2013 is Rs.3.73 Crores/-( Rs. 2.98 Crores). The amount is required to be spent on activities qualifying as CSR expenditure as per schedule VII of the Companies Act 2013.

During the financial year 2016-17 the company has spent sums aggregating to Rs.0.19 crore (Rs.0.24 crore) towards CSR activities. The details of disclosure as per the Guidance issued by the Institute of Chartered Accountants of India is as follows:-

(a) Gross amount required to be spent by the Company during the year Rs.3.73 Crores/-

24. Previous year figures have been regrouped and rearranged wherever necessary, to conform to current year classification.

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Mar 31, 2016

I) Contingent Liabilities not provided for:-

(a) Claims against the Company not acknowledged as debts Rs. 20.96 lakh (Rs.20.96 lakh)

(b) Disputed Income tax Liability Rs. 617.58 lakh ( Rs.130.45 lakh) .

ii) Commitment towards sanction pending disbursement including part disbursement as on 31-03-2016 - Rs.37018.93 lakh (Rs.30,669.62 lakh).

iii) Pending Capital Commitments: Pending capital commitments as on 31st March 2016 is Rs. 1,94,36,641 (Rs. 2,03,54,882).

iv) Deferred Tax:

The components of deferred tax assets and deferred tax Liabilities as on 31-03-2016 and as at 31-03-2015 are as under:

v) In the opinion of the Board, all Assets other than Fixed Assets and Non current Investments have a realizable value in the Ordinary course of business which is not different from the amount at which it is stated with the exception of Non performing advances for which requisite provision has been made in accordance with the NHB Guidelines.

vi) Classification of Loans and Provisions made for Non-Performing Assets are as under:

vii) There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2016. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

viii) Expenditure incurred in foreign currency: Towards Travelling Expenses - Rs. 13,22,362/- (Rs.10,39,849 /-) . There are no Earnings in foreign currency during the current year as well as in the previous year.

ix) There are no amounts to be reflected under payable to Investor Protection Fund.

x) Related Party Transactions

Disclosures in terms of Accounting Standard 18 "Related Party Disclosure" (AS 18)are given below:- List of related parties:

Promoter Associates

Repco Bank Ltd., Repco Micro Finance Ltd.,

Key Management Personnel

Shri R. Varadarajan Managing Director

Shri I Natarajan Executive Director

Shri V Raghu Executive Director

Shri T. Karunakaran Chief Financial Officer

Shri K. Prabhu Company Secretary and Compliance Officer

xi) The main business of the Company is to provide long term loan financing for Residential purposes in India. Accordingly, there is no separate reportable segment as per Accounting Standard - AS-17 "Segment Reporting", as the Company has only one Geographical and Business segment.

xii) EMPLOYEE BENEFITS

i. Defined Contribution Plan:

Company Contribution to Provident fund : Rs. 2,01,95,367

(xiii) National Housing Bank during the inspection of the company with reference to the position as on 31st March 2013 has observed that the company''s Net Owned Fund (NOF) and Capital Adequacy Ratio (CAR) was Rs.612.66 crore and 25.07% respectively as against Rs.623.26 crore and 25.50% worked out by the company as at end of March 2013. The difference was attributed to not considering Rs.64.03 crore deposited with parent bank i.e., Repco Bank Ltd., for the purposes of calculation of NOF and short provisioning to the extent of Rs.74.33 lakh, on account of reclassification of non-performing advances / standards advances.

The contention of the company that Repco Bank Ltd., was not a body corporate and hence not considered the deposit amount with Repco Bank Ltd., for calculation of NOF, was not acceptable to NHB. However, the CAR of the company as at end of March 2013 was well above the statutory minimum requirement of 12%.

National Housing Bank during the inspection of the company with reference to the position as on 31st March 2014 has observed that the company''s Net Owned Fund (NOF) and Capital Adequacy Ratio (CAR) was Rs. 718.46 crore and 24.26% respectively as against Rs. 719.32 crore and 24.51% worked out by the company as on that date. The difference was attributed to additional provisioning due to reclassification of standard/Non performing advances with consequential reversal of income, negative amortization, wrong treatment of Commercial Real Estate loans, and provisioning towards loans extended to employees.

xiv) During the year Company has rephased certain advances consequent to floods in certain districts of Tamilnadu. The advances outstanding related to these accounts aggregate to Rs. 209.49 crore as at 31/03/2016. (As part of the Rephasement Company has extended repayment holiday ranging from 3 months to 6 months and these advances have been classified as Performing advances based on the NHB Directions.)

xv) Employee Stock Option Scheme-2013 (ESOP-2013): During the year 2013-14 the Company instituted Employee Stock Option Scheme 2013 (ESOP-2013). The Board of Directors and the share holders approved the scheme during the year 2013-14. As on 31-03-2016 the company has following Employee stock options schemes, the features of the same are as follows:-

xvi)During the year one of the associate company Repco Infrastructure Development company limited was wound up, accordingly the investment made in the company amounting to Rs.500000/- is written off to the statement of profit and loss.Further provision already made towards this investment amounting to Rs.500000/- is written back to the statementof profit and loss.

xvii) Details of Reserve Fund Created under Section 29C of the NHB Act, 1987. Disclosure as per the directions of the National Housing Bank communicated vide their letter NHB (ND)/DRS/Pol.Circular.61/2013-14, dt April 7, 2014

xviii) Expenditure towards Corporate Social responsibility:

The gross amount required to be spent by the company during the year 2015-16 as CSR expenditure under section 135 of the Companies Act of 2013 is Rs. 2,98,02,461/-(Rs. 2,24,26,970) being 2% of the average profit after tax of past three financial years . The amount is required to be spent on activities qualifying as CSR expenditure as per schedule VII of the Companies Act 2013.

During the financial year 2015-2016 the company has spent sums aggregating to Rs. 24,25,000 towards CSR activities. The details of disclosure as per the Guidance issued by the Institute of Chartered Accountants of India is as follows:-

(a) Gross amount required to be spent by the Company during the year Rs. 2,98,02,461/-

(b) Amount spent during the year :-

xix) Provision required towards long term investments- Nil (Rs.5,00,000)

xx) Previous year figures have been regrouped and rearranged wherever necessary, to conform to current year classification.

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Mar 31, 2015

1) Contingent Liabilities not provided for:-

(i) Claims against the Company not acknowledged as debts Rs. 20.96 lakh (Rs.20.96 lakh)

(ii) Disputed Income tax Liability Rs. 130.46 lakh ( Rs. NIL) .

2) Commitment towards sanction pending disbursement including part disbursement as on 31-03-2015 - Rs.30,669.62 lakh (Rs.21,405.72 lakh).

4) In the opinion of the Board, all Assets other than Fixed Assets and Non current Investments have a realizable value in the Ordinary course of business which is not different from the amount at which it is stated with the exception of Non performing advances for which requisite provision has been made in accordance with the NHB Guidelines.

5) There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2015. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

6) Expenditure incurred in foreign currency: Towards Travelling Expenses - Rs. 10,39,849/- (Rs.420,949/-) . There are no Earnings in foreign currency during the current year as well as in the previous year

7) There are no amounts to be reflected under payable to Investor Protection Fund.

8) Related Party Transactions

Disclosures in terms of AS 18 issued by ICAI are given below:- List of related parties:

Promoter Associates

Repco Bank Ltd., Repco Micro Finance Ltd.,

Repco Infrastructure Development Company Ltd.,

Key Management Personnel

Shri R. Varadarajan Managing Director

Shri P. Natarajan Executive Director

Shri V. Raghu Executive Director

Shri T. Karunakaran Chief Financial Officer

Shri K. Prabhu Company Secretary and Compliance Officer

9) The main business of the Company is to provide long term loan financing for Residential purposes in India. Accordingly, there is no separate reportable segment as per Accounting Standard - AS-17 "Segment Reporting", as the company has only one Geographical and Business segment.

10) During the year National Housing Bank vide their circular 65/2014-15 dated August 22, 2014 directed Housing finance Companies (HFC) to provide for deferred tax liability in respect of amount transferred to 'Special Reserve" created under Section 36(i)(viii) of the Income tax Act 1961. NHB further advised the Housing finance companies to provide deferred tax liability in respect of accumulated balance of special reserve as on 31/03/2014 out of reserves over a period of three years commencing from the current year in a phased manner in the ratio of 25:25:50. However the company has adjusted the entire deferred tax liability of Rs.45,72,75,504 on account of Special reserve outstanding as at 31/03/2014 out of the general reserves outstanding at the beginning of the year.

Further in respect of special reserve under section 36(i)(viii) created during the current year, the company has recognized deferred tax liability of Rs.14,23,42,704/- on such Special reserve and charged to statement of profit and loss in accor- dance with the NHB guidelines.

11) The company has changed the method of providing depreciation from 1st April 2014 as required by the Companies Act, 2013. Accordingly depreciation is provided in accordance with Schedule II thereof for the current year as against the rates specified in Schedule XIV to the Companies Act, 1956 adopted in the previous year. As a result, depreciation for the cur- rent year is lower by Rs. 43.68 lakhs.

Further, in respect of assets whose remaining useful life is "NIL", their carrying amounts as on 1st April 2014, aggregating to Rs.21,25,781/- is adjusted against retained earnings as at 1st April 2014.

12) The Company during the current year has written back unpaid Initial Public Offer (IPO) expenses aggregating to Rs.23,14,057/-. Since originally these expenses have been adjusted against share premium account, the amount not pay- able as above is added to the securities premium account during the current year.

13) EMPLOYEE BENEFITS

i. Defined Contribution Plan:

Company Contribution to

i. Provident fund : Rs.16,299,437

14) There are no penalties levied on the company by the National Housing Bank.

15) Expenditure towards Corporate Social responsibility:

The gross amount required to be spent by the company during the year 2014-15 as CSR expenditure under section 135 of the Companies Act of 2013 is Rs. 2,24,26,970/- being 2% of the average profit after tax of past three financial years . The amount is required to be spent on activities qualifying as CSR expenditure as per schedule VII of the Companies Act 2013.

During the financial year 2014-2015 the company has spent sums aggregating to Rs.13 lakh towards CSR activities. The details of disclosure as per the Guidance issued by the Institute of Chartered Accountants of India is as follows:- (a) Gross amount required to be spent by the Company during the year Rs. 2,24,26,970/-

16) Previous year figures have been regrouped and rearranged wherever necessary, to conform to current year classification.

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Mar 31, 2014

1) CONTINGENT LIABILITIES

Claims against the Company not acknowledged as Debts Rs.20.96 lakh (Rs.20.96 lakh)

2) Commitment towards loan sanction pending disbursement including part Disbursement as on 31-03-2014 - Rs.21,405.72 lakh (Rs.21,108.33 lakh).

3) DEFERRED TAx:

The components of deferred tax assets and deferred tax Liabilities as on 31-03-2014 and as at 31-03-2013 are as under:

4) In the opinion of the Board, all Assets other than Fixed Assets and Non current Investments have a realizable value in the Ordinary course of business which is not different from the amount at which it is stated with the exception of Non perform- ing advances for which requisite provision has been made in accordance with the NHB Guidelines.

5) Classification of Loans and Provisions made for Non-Performing Assets are as under:

6) The company has raised Rs.270.23 crore by way of Initial Public Offer of its Equity Shares of 15,720,262, during the year 2012-13. The Proceeds of the Initial Public Offer are fully utilized for the purpose stated in the offer document.

7) There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2014. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

8) Expenditure incurred in foreign currency: Towards Travelling Expenses - Rs.420,949/- (Rs.718,575/-). There are no Earnings in foreign currency during the current year as well as in the previous year.

9) There are no amounts to be reflected under payable to Investor Protection Fund.

10) Related Party Transactions

Disclosures in terms of AS 18 issued by ICAI are given below:-

List of related parties:

Promoter Associates

Repco Bank Repco Micro Finance Ltd.,

Repco Infrastructure Development Company Ltd.,

Company holding substantial interest

First Carlyle Growth VI

key Management Personnel

Shri. R. Varadarajan Managing Director

Shri. P. Natarajan Executive Director

Shri. V. Raghu Executive Director

11) The main business of the Company is to provide long term loan financing for Residential purposes in India. Accordingly, there is no separate reportable segment as per Accounting Standard - AS-17 "Segment Reporting", as the company has only one Geographical and Business segment.

12) Earning per share (Basic and Diluted)

The Company has adopted the intrinsic value method in accounting for employee cost on account of ESOP. Based on such valuation, amount aggregating to Rs.51,639,085/- is accounted as Deferred Employee Compensation by crediting Employee Stock Options Outstanding. Deferred Employee Compensation cost is amortized over the vesting period, and accordingly an amount of Rs.223,53,357/- is treated as an Employee Cost for the current year.

The Black-Scholes model has been used to derive the estimated value of Stock Option granted, if the fair value method to account for the ESOP were to be used. The parameters used for deriving the estimated value of stock option granted under Black-Scholes model as follows:

Had the company adopted the fair value method in respect of the options granted, the total amount that would have been amortized over the vesting period is Rs.527,85,000/- and the impact on the financial statements would be as follows:-

13) Details of Reserve Fund Created under Section 29C of the NHB Act, 1987. Disclosure as per the directions of the National Housing Bank communicated vide their letter NHB(ND)/DRS/Pol.Circular.61/2013-14, dt April 7, 2014

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Mar 31, 2013

A) CONTINGENT LIABILITIES

i) Claims against the Company not acknowledged as Debts Rs.20.96 lakh (Rs. 20.96 lakh)

ii) Disputed Income tax Liability Rs.NIL (Rs.20.38 lakh)

b) Commitment towards sanction pending disbursement including part Disbursements as on 31-03-2013 - Rs.21,108.33 lakh (Rs.15,458.53 lakh).

c) In the opinion of the Board, all Assets other than Fixed Assets and Non current Investments have a realizable value in the Ordinary course of business which is not different from the amount at which it is stated with the exception of Non performing advances for which requisite provision has been made in accordance with the NHB Guidelines.

d) During the year, the company has made an Initial Public Offer (IPO) through Book Building process of 15,720,262 numbers of Equity Shares @ Rs.10/- each. The equity shares have been priced and allotted at Rs.172/- per equity share. (Includ- ing Share premium at Rs.162/- per equity share) Except in the case of allotment of 98,025 equity share for subscription by eligible employees of the company/Promoter where the allotment was made at a price of Rs.156/- per equity share at a discount of Rs.16/- per equity share (including a premium of Rs.146/- per equity share).

The company has raised Rs.270.23 crore out of the IPO. Post issue the holding of Repco Bank in the paid up equity share capital of the company has came down from 50.02% to 37.37% The equity shares offer to the public have been allotted on 22nd March 2013 and have been listed in the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) on 1st April 2013. Accordingly issued and paid up share capital has increased from Rs.46.44 crore to Rs.62.16 crore and an amount of Rs.243.52 crore (Net of Issue expenses of Rs.10.99* crore, which includes Rs.15.00 lakh to the auditors) has been credited to securities premium account. The proceeds of the issue (net of issue expenses) are being utilized for the purpose mentioned in the prospectus/retained in Bank Deposit pending utilization.

e) National Housing Bank has observed that the Company''s Net Owned Fund (NOF) and CRAR was Rs.287.03 Crore and 15.86% respectively as at the end of March 31st, 2012 as against Rs.295.33 Crore and 16.5% respectively worked out by the Company for the year 2011-12. The difference was attributed to non deduction of intangible assets, deferred IPO expenses, Disputed Income tax and required provisioning. Company had not deducted software- intangible asset, Pre paid IPO expenses, and Disputed income tax from the net owned funds having regard to the nature of each item on a consistent basis.

Further National Housing Bank observed that the Company had not created the reserve fund in terms of Section 29C of the National Housing Bank Act, 1987. Since the company was crediting Minimum of 20% of the profits every year to re- serve under section 36 (1) (VIII) of the Income Tax Act, 1961, regularly which was also considered to be the reserve created under Section 29C of the National Housing Bank Act, 1987 no additional reserve was created. This has been adequately reflected in the current year disclosure.

The Company over and above the minimum requirement of 20% has also created an additional reserve of Rs.16.01 Crore under Section 29C of NHB Act, during the current year.

f) There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2013. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

g) Expenditure incurred in foreign currency : Rs. 7,18,575/- (NIL). There are no Earnings in foreign currency during the cur- rent year as well as in the previous year.

h) There are no amounts to be reflected under payable to Investor Protection Fund.

i) Related Party Transactions

Disclosures in terms of AS 18 issued by ICAI are given below:- List of related parties:

Promoter Associates

Repco Bank Repco MSME Development Company Ltd.,

Repco Infrastructure Development Company Ltd.,

Company holding substantial interest

First Carlyle Growth VI

Key Management Personnel

Shri R. Varadarajan, Managing Director

Shri I Natarajan Executive Director-In Charge up to 28-08-2012 and Executive Director (from 29-08-2012)

Shri V Raghu, Executive Director (from 01-11-2012)

j) The main business of the Company is to provide long term loan financing for Residential purposes in India. Accordingly, there is no separate reportable segment as per Accounting Standard - AS-17 "Segment Reporting", as the company has only one Geographical and Business segment.

k) Rupee Equivalent of Foreign Currency paid towards Buy back of shares during the current year NIL (Rs. 10,000/-)

l) There are no penalties levied on the company by the National Housing Bank.

m) Previous year figures have been regrouped and rearranged wherever necessary, to conform to current year classification.

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Mar 31, 2012

A) CONTINGENT LIABILITIES

i) Claims against the Company not acknowledged as Debts Rs.20.96 lakh (Rs. 20.96 lakh)

ii) Disputed Income tax Liability Rs.NIL (Rs.20.38 lakh)

b) Commitment towards sanction pending disbursement including part Disbursements as on 31-03-2013 - Rs.21,108.33 lakh (Rs.15,458.53 lakh).

c) DEFERRED TAX

The components of deferred tax assets and deferred tax Liabilities as on 31-03-2013 and as at 31-03-2012 are as under:

d) In the opinion of the Board, all Assets other than Fixed Assets and Non current Investments have a realizable value in the Ordinary course of business which is not different from the amount at which it is stated with the exception of Non performing advances for which requisite provision has been made in accordance with the NHB Guidelines.

f) During the year, the company has made an Initial Public Offer (IPO) through Book Building process of 15,720,262 numbers

of Equity Shares @ Rs.10/- each. The equity shares have been priced and allotted at Rs.172/- per equity share. (Includ- ing Share premium at Rs.162/- per equity share) Except in the case of allotment of 98,025 equity share for subscription by eligible employees of the company/Promoter where the allotment was made at a price of Rs.156/- per equity share at a discount of Rs.16/- per equity share (including a premium of Rs.146/- per equity share).

The company has raised Rs.270.23 crore out of the IPO. Post issue the holding of Repco Bank in the paid up equity share capital of the company has came down from 50.02% to 37.37% The equity shares offer to the public have been allotted on 22nd March 2013 and have been listed in the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) on 1st April 2013. Accordingly issued and paid up share capital has increased from Rs.46.44 crore to Rs.62.16 crore and an amount of Rs.243.52 crore (Net of Issue expenses of Rs.10.99* crore, which includes Rs.15.00 lakh to the auditors) has been credited to securities premium account. The proceeds of the issue (net of issue expenses) are being utilized for the purpose mentioned in the prospectus/retained in Bank Deposit pending utilization.

The proceeds of Initial Public offer Equity shares are utilized as under upto 31/03/2013:-

Particulars Amount Rs. in Crore

Share Issue Proceeds 270.23

Less: Issue Expenses Paid upto 31/03/2013 4.75

Less: Used for the Purpose of Business 72.24

Amount kept in Banks 186.01

Balance outstanding in public issue account 7.23

g) National Housing Bank has observed that the Company''s Net Owned Fund (NOF) and CRAR was Rs.287.03 Crore and 15.86% respectively as at the end of March 31st, 2012 as against Rs.295.33 Crore and 16.5% respectively worked out by the Company for the year 2011-12. The difference was attributed to non deduction of intangible assets, deferred IPO expenses, Disputed Income tax and required provisioning. Company had not deducted software- intangible asset, Pre paid IPO expenses, and Disputed income tax from the net owned funds having regard to the nature of each item on a consistent basis.

Further National Housing Bank observed that the Company had not created the reserve fund in terms of Section 29C of the National Housing Bank Act, 1987. Since the company was crediting Minimum of 20% of the profits every year to re- serve under section 36 (1) (VIII) of the Income Tax Act, 1961, regularly which was also considered to be the reserve created under Section 29C of the National Housing Bank Act, 1987 no additional reserve was created. This has been adequately reflected in the current year disclosure.

The Company over and above the minimum requirement of 20% has also created an additional reserve of Rs.16.01 Crore under Section 29C of NHB Act, during the current year.

h) There are no Micro, Small and Medium Enterprises (MSME) to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2013. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

i) Expenditure incurred in foreign currency : Rs. 7,18,575/- (NIL). There are no Earnings in foreign currency during the cur- rent year as well as in the previous year.

j) There are no amounts to be reflected under payable to Investor Protection Fund.

k) Related Party Transactions

Disclosures in terms of AS 18 issued by ICAI are given below:- List of related parties:

Promoter Associates

Repco Bank Repco MSME Development Company Ltd.,

Repco Infrastructure Development Company Ltd.,

Company holding substantial interest

First Carlyle Growth VI

Key Management Personnel

Shri R. Varadarajan, Managing Director

Shri I. Natarajan Executive Director-In Charge up to 28-08-2012 and Executive Director (from 29-08-2012)

Shri V. Raghu, Executive Director (from 01-11-2012)

l) The main business of the Company is to provide long term loan financing for Residential purposes in India. Accordingly, there is no separate reportable segment as per Accounting Standard - AS-17 "Segment Reporting", as the company has only one Geographical and Business segment.

o) Rupee Equivalent of Foreign Currency paid towards Buy back of shares during the current year NIL (Rs. 10,000/-)

q) EMPLOYEE BENEFITS

i. Defined Contribution Plan:

Company Contribution to

i. Provident fund : Rs.9,182,385/-

v) There are no penalties levied on the company by the National Housing Bank.

x) Previous year figures have been regrouped and rearranged wherever necessary, to conform to current year classification.

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Mar 31, 2011

1) Share Capital

a) Equity shares include 1004 differential equity shares subscribed by the First Carlyle Growth VI (Investor) and Co-Investors in accordance with the Share Purchase, Share Subscription and Shareholders Agreement entered between the Company, Promoter of the Company, Investor and Co-Investors on 28-12-2007 and carry differential rights in relation to voting, dividend and other rights.

b) 40,224,000 5% Series "A" cumulative fully convertible preference shares of Rs.10/- each were converted into 7,837,877 equity shares on 30 July 2009 at a premium of Rs.41.32 in accordance with the Share Purchase, Share Subscription and Shareholders Agreement entered between the Company, Promoter ot the Company, Investor and Co-Investors on 28-12-2007. Accordingly, Rs.78,378,770/- was credited to share capital account and Rs.323,861,230/- was credited to share premium account.

2) Commitment towards sanction pending disbursement including part Disbursements as on 31-03-2011 - Rs.14,031.26 lakh (Rs. 9,520.52 lakh).

3) Secured Loans include Rs.27,779.36 lakh (Rs. 25,805.92 lakh) lakh falling due for repayment within one year.

4) In the opinion of the Management, the Current assets, loans and advances as stated in the balance sheet are realizable in the normal course of business.

5) There are no Micro and Small Enterprises to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2011. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company.

6) There are no amounts to be reflected under payable to Investor Protection Fund.

7) The main business of the Company is to provide long term loan financing for Residential purposes in India. Accordingly, there is not separate reportable segment as per Accounting Standard - AS-17 "Segment Reporting".

8) Previous year figures have been regrouped and rearranged wherever necessary, to confirm to current year classification.

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Mar 31, 2010

1) Share Capital

a) Equity shares include 1,004 differential equity shares subscribed by the First Carlyle Growth VI (Investor) and Co-Investors in accordance with the Share Purchase. Share Subscription and Shareholders Agreement entered between the Company, Promoter of the Company, Investor and Co-Investors and carry differential rights in relation to voting, dividend and other rights.

b) 40,224,000 5% Series "A" Cumulative Fully Convertible Preference Shares of Rs. 10/- each were converted into 7,837,877 equity shares on July 30.2009 at a premium of Rs 41 32 in accordance with the Share Purchase. Share Subscription and Shareholders Agreement entered between Ihe Company. Promoter of the Company. Investor and Co-Investors. Accordingly, Rs.78,378,770/- was credited to share capital account and Rs.323.861 230/- was credited to share premium account.

2) Commitment towards sanction pending disbursement including part disbursements as on March 31.2010 Rs. 9,520.52 lakh {Rs. 3.380 28 lakh)

3) Secured Loans include Rs 25.805.92 lakh (Rs. 15.474 33 lakh) lakh falling due for repayment within one year

4) In the opinion of the Management, the Current assets, loans and advances as stated in the balance sheet are realizable in the normal course of business.

5) During the year Company has changed the policy of NPA provisioning In respect of sub standard assets 15% provision was made as against required norms of 10% and in respect of all the doubtful assets provision has been made at 50% on secured provision as against 20% / 30% / 50% stipulated by NHB. Due to this profit for the year is lower by Rs 172/- lakhs

6) There are no Micro and Small Enterprises to whom the Company owes dues, which are outstanding for more than 45 days as at 31 -03-2010. This information as required to be disclosed under the Micro. Small and Medium Enterprises Development Act. 2006 has been determined to the extent such parties have been identified on the basis at information available with Ihe Company

7) There are no amounts to be reflected under payable to Investor Protection Fund

8) Related Party Transactions

As per Accounting Standard 18 on related party disclosure issued by the Institute of Chartered Accountants of India, the Company''s related parties are disclosed below

List of related parties

Promoter

Repco Bank

Company holding substantial interest

First Carlyle Growth VI

Key Management Personnel

Shri M. Balasubramaniari Managing Director

Shri S.V. Balasubramanian. Executive Director

9) Previous year figures have been regrouped and rearranged wherever necessary

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Mar 31, 2009

1) Share Capital

Equity shares include 1004 differential equity shares subscribed by the First Carlyle Growth VI (Investor) and Co-Investors in accordance with the Share Purchase. Share Subscription and Shareholders Agreement entered between the Company Promoter nf the Company investor and Co-Investors on 2fl-2007 and carry differential rights in relation to voting, dividend and other rights

5% Series ,LA" cumulative fully convertible preference shares ot Rs. 10/- each are convertible into equity shares at a premium in accordance with the Share Purchase, Share Subscription and Shareholders Agreement entered between the Company, Promoter of the Company, investor and Co-Investors on 2E5-12-2007.

2) Commitment towards sanction pending disbursement including pari Disbursements as on 31.03.2009 - Rs.3,380.28lakh (Rs.3.701.42lakh).

3) Secured Loans include Rs. 15.474.33 lakh (Rs.0.289.57) lakh tailing due for repayment within one year.

4) In the opinion of the Management, the Current assets, Joans and advances as stated in the balance sheet are realizable in the normal course of business.

5) Confirmation of balances have not been vitriol Housing Loans, Sundry Debtors and other current assets and Loans and Advances.

6) There are no Micro and Small Enterprises to whom the Company owes dues, which are outstanding for more than 45 days as at 31-03-2009. T his information as required to be disclosed under the Micro Smell and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis at information available with the Company

7) There are no amounts to be reflected under payable to Investor Protection Fund.

8) Related Party Transactions

As per Accounting Standard 13 on related party disclosure, issued by Lha Institute of Chartered Accountants of India, the Company''s related parties are disclosed below:

List of related parties:

Promoter

Repco Bank

Company holding substantial interest

First Carlyie Growth VI

Key Management Personnel

Shri M. Dalasubramanian. Managing Director

Shri 5.V, Baiasubramanian, Executive Director

9) EMPLOYEE BENEFITS

i. Defined Contribution Plan:

Company Contribution to

i. Provident fund & Superannuation : Rs. 3,029,687/- fund

ii. Defined benefit Plan:

10) Previous year figures have been remixed and rearranged wherever Necessary.

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Mar 31, 2008

1) Share Capital

Equity shares include 1004 differential equity shares subscribed by the First Carlyle Growth VI (Investor) and Co- in1vesiors in accordance with the Share Purchase-. Share Subscription and Shareholders Agreement entered between the Company. Promoter of the Company Investor and Co Investors on 28-12-2007 and carry differential rights in relation to voting, dividend and other rights.

5% Series "A" cumulative fully convertible preference shares of R s. 10 each are convertible into equity shares at a premium in accordance with the Share Purchase, Share subscription and Shareholders Agreement entered between the Company. Promoter of the Company investor and Co-Investors on 28 12-2007.

2) Dividend

Equity dividend include dividend payable to differ equity share holders amounting to Rs.829.458. representing the positive difference between (i) the dividend payable to Investors on an i:as-if converted basis" arid (ii) the dividend payable by the Company on the Series "A" cumulative fully convertible preference shares

3) Commitment towards sanction pending disbursement including part Disbursements as on 31.03.2008 Rs. 3701,42 lakhs (Rs. 1661.00 Lakhs).

4) Secured Loans include Rs.9.789 57 lakhs (Rs.9,706.39) lakhs falling due for repayment within one year.

5) Deferred Tax:

6) In the opinion of the management the current assets, loans and advances as stated in the balance sheet are realizable in the normal course of business.

7) Confirmation of balances have not been received in respecl of housing loans, sundry debtors and other current assets arid loans & advances

9) There arc no amounts payable to any Small Scale Industrial Undertaking

10) There are no Micro and Small Enterprises to whom the Company owes dues, which are outstanding tor more than 4n days as at 31-03-2008. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined (the extent such parties) have been identified on the basis at information available with the Company.

11) Expenditure incurred in to foreign currency

Travelling expenses: - Rs. 39,309/-

12) The are on amounts to be reflected under/payable to investor Protection fund,

13) Related Party Transactions

As per Accounting Standard 18 on related parly disclosure, issued by the Institute of Chartered Accountants of India, the Company''s related parties are disclosed below:

List of related parties:

Promoter

Repco Bank

Company holding substantial interest

First Carlyle Growth Vt

Key Management Personnel

Shri M Balasubramanian, Managing Director

Shri S.V. Balasubramanian. Executive Director

14) Penalty paid to National Housing Bank during the year -Nil- (-Nil-)

15) Previous year figures have been regrouped and rearranged wherever necessary.