AR Main 2012-13_0.pdf · Marketing and Distribution During the year, ... HDFC Bank and a few third party direct selling associates (DSAs). Besides local and regional DSAs, tie-ups

15

THIRTY SIXTH ANNUAL REPORT 2012-13

Directors’ Report

TO THE MEMBERS

Your directors are pleased to present the Thirty-sixth annual report of your Corporation with the audited accounts for the year ended March 31, 2013.

FINANCIAL RESULTS

For the year ended

March 31, 2013 (` in Crores)

For the year ended

March 31, 2012 (` in Crores)

�� 6,572.84 5,665.62

Tax Expense 1,724.50 1,543.00

�� 4,848.34 4,122.62

��

Special Reserve No. II 775.00 730.00

General Reserve 956.62 870.87

Additional Reserve (under Section 29C of the National Housing Bank Act, 1987) 825.00 620.00

Shelter Assistance Reserve 40.00 15.00

Proposed Dividend (at ` 12.50 per equity share of face value of ` 2 each) 1,932.93 1,624.67

Additional Tax on Proposed Dividend 328.50 263.56

Additional Tax on Dividend (24.62) (4.66)

Dividend pertaining to Previous Year paid during the year 14.91 3.18

4,848.34 4,122.62

Dividend

�� of dividend for the financial year ended March 31, 2013 of ` 12.50 per equity share of face value of ` 2 per share as against ` 11 per equity share for the previous year.

The dividend payout ratio for the current year, inclusive of additional �� !�"� ��#!$"��year.

Increase in the Shareholding Limit for Foreign Institutional Investors (FIIs)

�� %�� %&�you had through a special resolution %�� %� �� '**�� *�� +�� /�"� �� :;;"� �� <�� capital of the Corporation.

Accordingly, the Reserve Bank of *��=>?*@��J��

�� K�� '**�� %�� L��L� ��%�� *��+�� :;;"� �� <��share capital of the Corporation. As at March 31, 2013, the total foreign shareholding of the Corporation stood ��/�"!

Conversion of Warrants

In August 2009, the Corporation had issued 1,09,53,706 Warrants with �� %�� O��holders to exchange each Warrant with one equity share of face value of `�:;��&��%��24, 2012, at a Warrant Exercise Price of ` 3,000 per equity share.

K��J�� <�� J��shares of the Corporation to ` 2 per ��&� �� %�� Q:&�2010, the Warrant Exercise Price was accordingly adjusted to ` 600 per equity share of face value of `�Q��&��O�� %��O��!� ��%��&� �� of Warrants issued was adjusted to 5,47,68,530.

As at August 24, 2012, 5,47,43,150 O�� %�� exchange with equity shares of the K��&� ��%� UU!U#"�of the Warrants issued. Accordingly, the Corporation issued and allotted 5,47,43,150 equity shares of `� Q� �� of ` 3,284.59 crores. The said equity shares rank pari passu with the existing equity shares of the Corporation in all respects.

�� %� ��Warrants were utilised to replace �� V�� K�� X�� consequently, the Corporation will not �� !

16

25,380 Warrants which were not �� %� �� J�� K�� :#�Warrant holders have lapsed and �� !� ��%��&� �� forfeited.

Lending Operations

Loan approvals during the year were `� :&;[&Q�;� �� ` 90,154 crores in the previous year �� %� ��year were ` 82,452 crores as against ` 71,113 crores in the previous year.

Individual loan approvals and �� %�� QU"� ��[["��%��!��average size of individual loans stood at ` 21.6 lacs as against ` 19.5 lacs in the previous year.

K�� \�� [:&�2013 were ` 5,66,660 crores and ` 4,56,098 crores respectively. This �� !�� %�units.

Despite an increase in residential

property prices during the year, the �� &��%�%��%��Q��[��!�]��%��L�� %� �� %� �� housing loans.

In an effort to continue to widen ��J��&��innovative product called ‘TRUFIXED `��b��m��%�� !� �� !�{��&� �� %��%� �� [� �� :;� �� &� �� !� �� !

O�� %�� %� �� &� �� K�� >�� ]�� option of a loan tenor of up to 30 years.

As at March 31, 2013, the loan ��L� �� ` 1,70,046 crores as against ` 1,40,875 crores in the previous year. Loans sold during the ��%� �� to ` 5,175 crores. The growth in the �� L&� �� %��L� �� [:"� =Q#"� ��of loans sold). Non-individual loans %��:["!��%�� L� �� %� ��L� ��Q�"�=Q:"��@!

]� �� L&� �� $"!� '��&� $:"�� %�� L��%��individual loans.

Sale of Loans

In May 2012, the RBI revised the guidelines on transfer of assets through securitisation and direct ��%�� |��!� �� L��changes in the guidelines for the sale �� %� �� :Q� ��&� �� :;"&�� %��L��%� ��loans are required to undertake a detailed due diligence prior to the ��%��!

All the individual loans sold during the year were in accordance with the revised guidelines. The Corporation, �� %�� %� �� ` 5,125 crores to HDFC Bank pursuant �� L�� %��the Corporation and HDFC Bank.

As at March 31, 2013, total loans outstanding in respect of loans sold/assigned stood at ` 16,964 crores. HDFC continues to service loans and is entitled to the residual interest on the loans sold. The residual interest on the individual loans sold/ ��%�� :![["� �� !� �� ~��%�� %� ��%�� the life of the underlying loans and ��!

Issues through which loans have �� ~��%�� introduction of the revised guidelines �� %�agencies and carry a rating indicating the highest degree of safety.

Repayments

During the year under review, `��$&;$U��%��

237

,45

0

191

,80

6

29

8,0

61

242

,219

373

,24

6

30

2,5

33

46

3,4

00

373

,64

6

56

6,6

60

45

6,0

98

0

100000

200000

300000

400000

500000

600000

20132012201120102009

DisbursementsApprovals

Approvals & Disbursements (Cumulative)(` in crores)

17


Funds Employed(` in crores)

13,1

376

4,4

81

19,3

75

15,1

98

73

,48

4 2

3,0

81

17,3

179

0,7

85 10

2,8

35

106

,89

5

24,3

27

19,0

18

36

,29

3

25

,00

0

51,9

33

0

20000

40000

60000

80000

100000

120000

20132012201120102009

DepositsTerm BorrowingsNet Worth

�� &�� ` 42,362 crores received last year.

Resource Mobilisation

Subordinated Debt

��\��[:&�Q;:[&��K��m��%� �� stood at `� [&�/#� ��!� �� K��%�� %�� %� �� K>*+*b� ��*K>�!� ?�� &� �� \�� [:&� Q;:[&�`�Q&U$#��L�� Tier II under the guidelines issued ��`��%�?��L�=�`?@�for the purpose of capital adequacy ��!��K�� %�the year.

Non-Convertible Debentures (NCD)

During the year, the Corporation ��KX��%� ��` 33,180 ��!�� K��m�� KX� ��

�� O�� X��\��L�� %�� +��L�� %��*��b�� ?+�� b��!� �� KX� �� %�� %��%��K>*+*b��m��*K>��m�� K>*+*b� �� *K>�� !� ��at March 31, 2013, NCD outstanding stood at ` 75,984 crores.

Term Loans from Banks, Financial �� National Housing Bank (NHB)

As at March 31, 2013, the total loans ��%� �� L�&� �� `?� �� `� :/&$Q�� ` 40,697 crores as at March 31, 2012. The fall in the outstanding loan �� %��L��!��?��>��L��%�� year under review, the Corporation �� L� �� L��%��!

`X'Km�� %<�� <��L� �� assigned the highest rating of ‘CARE ��m� �� K�>�� :�m� �� K�>�� >��%�&� ��%��%� ��%�� %� �� %��!

During the year, the Corporation has �� `?� �� %� �� ` 627 crores, of which over one-third �� Rural Housing Fund.

Deposits

During the year, the Corporation ��%�� ` 36,293 crores to ` 51,933 ��!� �� %�� :Q!U� �� :#!�� depositors.

CRISIL and ICRA have for the e ighteenth consecut ive year, �� K>*+*b� '��m� ��*K>�� \��m� ��%�� `X'Km�� !� �� %��represent the highest degree of �� %��%� �� %� ��%��the lowest credit risk.

The support of the agents and their �� K�� `X'Km��%� ��and trusts.

Unclaimed Deposits

�� \�� [:&� Q;:[&� �� %� �� ` 270.58 �� 28,330 depositors. Since then, �&Q[�� renewed deposits of ` 82.89 crores. X��%��%�� J��!�O��&��to depositors periodically and follow up action is initiated through the ��%��!

As per the provisions of Section Q;#K� �� K�� &� :U#�&�� %� �� *��Education and Protection Fund =*��'@� �� K��!��%��&��%� ��&� �� %��&��of `�#U!:U�� *��'!� *�� &�� %��the Corporation or the IEPF after the transfer.

18

Non-Performing Loans

�� <��%� �� \�� [:&� Q;:[� �� ` 1,199 crores. This is equivalent to ;!/;"� �� =�� %��;!/�"� �� @!� �� the thirty-third consecutive quarter end at which the percentage of non-��%� �� than the corresponding quarter in the �� !� �� <��%�loans of the individual portfolio ��;!#$"��<��;!U:"!

?�� &��<��%��\��[:&�Q;:[��;!�;"�� %�� ;!��"� �� previous year.

�� `?� ��&� �� K��is required to carry a total provision of ` 1,506 crores of which only ` 387 crores is on account of non-��%� �� ` 1,119 crores is in respect of general provisioning on standard loans including D�� >�� `��Loans (DRHL). Thus the Corporation

carries an additional provision of ` 286 crores over the regulatory �J��!

�� %�� <��%� �� `� :&:UU� ��&� �� provision for contingencies account as at March 31, 2013 stood at ` 1,792 crores (inclusive of provision �� <��%� ��@!� �� J��:!;#"��!

��X>`b��|��%�� L�� `X'Km�� >��b��%�>��April 1, 2012. As per NHB guidelines, �� K�� %�� %� �� Q"�on standard DRHL up to one year after the interest rates were re-set. ��%��&� �� 1, 2013, the Corporation will no ��%�� %��provisioning on these loans.

The Securitisation and Reconstruction ��'��of Security Interest Act, 2002 =+�>'��+*@��recovery tool and the Corporation ��recovery action under this Act in the case of wilful individual and corporate defaulters.

Regulatory Guidelines/Amendments

`X'K��`��%�'��K��=�`?@�X��&�Q;:;� �� `?� �%��%�accounting standards, prudential ��&��recognition, provisioning, capital adequacy, credit rating, concentration �� L�� !

`X'Km��J�� :�![#"� �� L� ��%��&� �� %�� J�� :Q"!� �� *� �� :[!$#"� �� %�� J��"!

*�� X�� Q;:Q&� �� >?*� ��%�� K��Borrowings (ECB) for low cost �� %� ��!� �� the notification, Housing Finance K�� =`'K@� �� K?�for on-lending to prospective owners �� %�units under the approval route. The Corporation had in January 2013, �� &��%�regulatory approval.

Codes and Standards

�`?��K��=��K@��Anti Money Laundering Standards �� '�� L�Force on Anti Money Laundering +�� K��%�'��%� �� +��!�X��%� ��&� �� K��m��K��Money Laundering Policy as stipulated ��`?!��K�� J�� %� ��

Composition of Loans Outstanding (%)(Inclusive of loans sold)(As at March 31, 2013)

68

31

1

Individuals - 68

Corporates - 31

Others - 1

Loan Quality &Provision for Contingencies

(%)

Six Month Gross NPLs as a % of Portfolio

Gross NPLs as a % of Portfolio

Provision for Contingencies as a % of Portfolio

0.81

0.56

0.72

0.79

0.53

0.66

0.77

0.46

0.95

0.74

0.44

1.16

1.05

0.70

0.40

0.0

0.2

0.4

0.6

0.8

1.0

1.2

20132012201120102009

Portfolio includes loans and investments in debenturesand corporate deposits for financing real estate projects.

19


��%� �� %� �� ~suspicious transactions.

�� '�� K�� `?� �L�� %�� %� ��%��&��%�� %� ��&� ��%��L��%��achieve higher operating standards, �� `'K��%�� !� �� K�� and review adherence to the Fair �� K�� Board of Directors.

The Corporation has adopted the Model Code of Conduct for Direct Selling Agents and Guidelines for >��%��%�%��`'K��`?��?��X��!

�� K�� and adopted a Share Dealing Code �� +�?*� =�� *�� %@�>%��&�:UUQ&��!�� &�� !�The said persons are restricted ��%� ��Corporation during the ‘restricted ��%� ��m� �� K��&��!�X��%�� &� �� %��%��%��!

Marketing and Distribution

During the year, ef for ts were concentrated on further strengthening �� L!� ��K��m�� L�

now spans 331 outlets, which ��$:��`X'Km�� &� `X'K�+�� b�� =`+�b@!� ��%�� L&�`X'K�covers over 90 additional locations ��%�� %��!�`X'K��b��&�+��%�� X��!� �� X�� across Middle East through its �� &��&�]��&�+��&��X��+��!

`X'Km�� channels, which include HSPL, HDFC Bank and a few third party direct selling associates (DSAs). Besides local and regional DSAs, tie-ups with ��L��!�� L�� K�� <��include IndusInd Bank and Ratnakar Bank. These channels only source loans, while the control over the credit, legal and technical appraisal ��`X'K&��ensuring that the quality of loans �� any way and is consistent across all ��!

Various online facilities such as <��&�accounting facilities for existing �� `X'Km�� service. The Corporation also uses �� !

The Corporation organised property �� country as well as organised events for developers to showcase their properties to the Indian diaspora in overseas locations like London, Singapore and the Middle East.

Cross Selling and Distribution of Financial Products and Services

`X'Km�� strong synergies with HDFC and hence efforts are channelled into ��%�� %� �� `X'Km��!

`X'K� �� `+�b� �� K��Corporate Agents for HDFC Standard b�� *�� K�� b��(HDFC Life) and HDFC ERGO General *�� K�� b�� =`X'K��>�]@!� *�� &� �� networks of HDFC and HSPL are used ��K��'��+��b��&��!�� `X'K�>��b��`X'K�>�� X�� =`X'K>�X!��@�� K��m��L!

International Housing Finance Initiatives

`X'Km�� %��is well regarded and therefore a �� %��%�� L��

Profits(` in crores)

0

1000

2000

3000

4000

5000

6000

7000

20132012201120102009

Profit After TaxProfit Before Tax

3,21

92,

283

3,91

6

2,82

6

4,86

7

3,53

5

5,66

6

4,12

3

6,57

3

4,84

8

20

HDFC for training, strategic input and technical assistance in housing ��!

During the year, senior executives of the Corporation were invited to Indonesia and Tanzania for training ��%�� services in housing finance. The International Finance Corporation under its technical assistance ��the Corporation to undertake a ��%�%� �� Rwanda.

In July 2012, the Frankfurt School �� '�� \��%�� HDFC jointly organised the fifth ‘Housing Finance Summer Academym�� &� �� %� �� %��%� ��L��%�� knowledge and practical experience.

*��Q;:Q&�`X'K��its own international training ��%�� Housing Finance Managementm� �� %� ��&�Centre for Housing Finance, located �� b��&� *��!� �� different countries across Asia and Africa attended a week-long ��%��%��!

Shelter Assistance Reserve (SAR)

HDFC par tners and suppor ts worthwhile projects undertaken �� <%�� %��through the SAR. During the year, �� K�� ` 9.13 �� +�>&� ��%� ��180 partner organisations spread across the country.

K�� towards the Marrow Donor Registry, Tata Medical Centre, Maithr i

��K��'�� +�� &� ��%�� !�The SAR was also utilised towards ��%� �� J��L��&�� children in Tripura and supporting �� ?�� ]��!�`X'K� �� ?��K�� &� �� b�%��of Life Trust and Indian Association �� K��Welfare.

The Corporation extended grant �� K��m��%� +�� X�� providing scholarships to deserving students, the Wildlife Conservation �� +�� %�m��%�&� \��&� �� %�� \�� +�L�� %�� children in New Delhi.

H T Parekh Foundation

Q;::� ��L�� year of late Shri H. T. Parekh, ��K��!�� %� �� *��&��the proposal to set up the H T Parekh Foundation. Shri H. T. Parekh was associated with several philanthropic causes and welfare organisations ��%��!

During the year, the Corporation incorporated the H T Parekh Foundation as a not for profit ��+��Q#��K��&�:U#�!�+��L�� include undertaking welfare activities

�� disadvantaged, provision of education ��%��the preservation and conservation �� *��m�� %!� +�� the receipt of requisite approvals, �� K�� ` 200 ��of the foundation over a period of 3 �� !� X��%� �� &� ��K�� ` 10 crores as equity capital to ��its activities.

Training and Human Resource Management

During the year, the Corporation �� %��!� ��%�� %&� �� m��%�� are assessed and worked upon. The �� %� �� !

�� <�� %��were conducted to enhance functional knowledge of frontline as well as ��L� �� !� ]�� %��included developing in-house ��&� ��%�� %�� %��%��!� +�� %� � �� %&�� &� �� &� ��L��&� ��L� ��%��&� ��detection and forensic accounting.

Building Service and Productivity Excellence

*��&� ��

21


assess and evaluate the service ��!� *�� &�during the year, the Corporation ��L�� K��>��%�� +�� m�(CREST).

K>�+�� <�%��%� ��&� �� L��%��%��%��%��%��K��m�� !

K>�+�� %�� %��in the loan appraisal and processing �� ! � * � � �� standardisation, centralisation and adoption of new technology. The �� %��%��&�� !��%��!

Rural Housing

Being a leading housing finance provider, the Corporation has felt the ��housing. Over the past four years, the K�� focused strategy on rural housing. �� K��m�� %�� %�� and consists of housing loans to ��%�� %�� activities and loans to salaried/self �� rural areas. The Corporation has �� %�� place a strong legal and technical ��L��!��Corporation will continue its efforts to identify potential rural areas, where �� aking place and

��L��title deeds.

Property Related Services

�� K�� %�� range of value added services and property related solutions to its ��!�`X'K�>��b�� `X'K� >�X� �� support services offered.

`X'K� >�� b�� individuals and corporate institutions ��&��!�X��%�� &� �� than 2,000 residential transactions, ��%� ��/;"�%�� %�� L��%� ��!� �� %�� L�\�� K��Region (NCR), whilst also focusing on expanding to new cities like K�� K��L&� ��%��others. Currently, HDFC Realty has a presence across 24 locations in India.

`X'K>�X!��&��<��%�� %� �� J��!� ��portal gives HDFC an advantage �� %�� %� ��!� `X'K� >�X� ��expanded its foothold to 23 cities across India, showcasing over 9,900 projects.

Education Initiatives

`X'K� �� X��+�� b�� =`��X+@�� K��m�� education sector. During the year, HEADS focused on graduate �� %��

states of Andhra Pradesh and Gujarat for creating entry level talent for the financial and IT services sectors. �� %�� `��X+��%��in other states.

HEADS is also working towards ��%� �� |�%�� <:Q� ��!� *��order to develop the infrastructure for ��&��L��%�� &� �� %<��%��!

Awards and Recognitions

During the year, the Corporation was awarded the ‘Leading Housing '��K��m��K�?K��:$��the India Best Bank and Financial Institution Awards, 2012. The Corporation was also adjudged �� ?�� `�� b�� m� ��Outlook Money Awards, 2012. This is the second consecutive year that the Corporation has won this award. ��K��L��%��*��m��L��Great Place to Work Institute®, 2012.

Subsidiary Companies

��*��&�\��Corporate Affairs vide General Circular ��!�Q~Q;::��'��$&�Q;::&�� %�� %�� J��of attaching to their annual report, �� &� �� and loss and the report of the directors and auditors in respect �� required under Section 212(8) of ��K��&�:U#�&��%��!

The Board of Directors has passed the necessary resolutions granting the requisite approvals for not attaching to the annual report of the K��&� ��

22

��&� �� &�reports of the directors and auditors �� %� :�� K��`X'K� X�� b��&� `X'K�*��b��&�`X'K�`��%��b��&� `X'K� �� \��%��K�� b��&� `X'K� ��K�� b��&� `X'K� >��b ��& � `X'K� +�� b� �*�� K�� b��&� `X'K��>�]� �� *�� K��b��&� �>{`� '�� b��&�`X'K� +�� b��&� `X'K�� K�� b��&�`X'K��K��b��&�`X'K�� b��&� K��'�� +�� b��&�`X'K� �� X��+�� b�� `� ��Parekh Foundation and the following ��<�� `X'K� �� \��%�� K��=+��%��@� ��!� b��&� `X'K�� \��%�� K��b��&��*��&�\�� !� b��&� +��%�� <� �� K�� \��31, 2013.

The annual report of the Corporation, the annual accounts and the related �� K��m��K��&�www.hdfc.com. Shareholders who wish to have a copy of the annual accounts �� K��!�'��&� �� %��of the Corporation.

�� K�� loans or advances in the nature

�� interested, other than in the ordinary ��!

Review of Key Subsidiary and Associate Companies

HDFC Bank Limited (HDFC Bank)

HDFC and HDFC Bank continue to ��m��%��in accordance with the regulatory ��L!� ?�� %��&�however, capitalise on the strong ��%�� %�� &� �� %�� cross selling in order to effectively provide a wide range of products and ��`X'K��!

As at March 31, 2013, net advances of HDFC Bank stood at ` 2,39,721 ��Q["��previous year. Total deposits stood at ` 2,96,247 crores – an increase of Q;"!� �� \�� [:&� Q;:[&� `X'K�?��Lm��L��[&;�Q� �� :;&/�[� ��\��in 1,845 cities as against 2,544 ��$&U:[��\�� :&[UU�cities as of March 31, 2012.

For the year ended March 31, 2013, `X'K� ?��L� �� tax of ` 6,726 crores as against ` 5,167 crores in the previous year, ��%� �� [;"!�For the year ended March 31, 2013, `X'K�?��L��of ` 5.5 per share of face value of ` 2 each as against ` 4.30 per share for the previous year. During the year the Corporation received a dividend of `�:�U��`X'K�?��L!

HDFC together with its wholly owned ��&� `X'K� *��b�� `X'K� `��%�� b�� QQ!$"� �� J�� capital of HDFC Bank.

HDFC Standard Life Insurance Company Limited (HDFC Life)

�� `X'K�Life for the year ended March 31, 2013 stood at ` 11,323 crores as ��` 10,202 crores in the �� !� �� force at the end of FY 2013 was `� Q&;:&$#$� �� ` 1,38,718 crores in the previous ��&��%��%��"!

�� 32 retail products and 10 group ��%��%&��&�� &��%��:;��!

`X'K� b�m�� L��#;��&��%�U�:��!� *��&� ��U#&;;;��&�[��%��:;��<*�� L�� %��tie-ups. In FY 2013, HDFC Life ranked ��Q&��&� ��%� �� L�� %�� !

`X'K� b�� ` 451.48 crores for the year ended March 31, 2013 as against ` 271.02 ��!��L��L� �� %��%� �� incurred in writing of new policies. �� Q:/"� �� \�� [:&� Q;:[�� %�� %��J��:#;"!

`X'K� �� /Q!�"� �� J��share capital in HDFC Life.

HDFC Asset Management Company Limited (HDFC-AMC)

HDFC and Standard Life Invest��

23


b��<��`X'K�Mutual Fund.

As at March 31, 2013, HDFC-AMC ��%��Q��&�J��&� ��%�traded fund and fund of fund ��`X'K�\��'��!��%� �� %��%� �� \�� Q;:[�stood at ` 1,02,142 crores (which is inclusive of average assets under ��%��~advisory services). HDFC Mutual '�� L�� %�� \��%��!� ��49 lacs as at March 31, 2013. HDFC-AMC has over 130 investor service centres across the country.

For the year ended March 31, 2013, `X'K<�\K� �� tax of ` 318.75 crores as against ` 269.14 crores in the previous year.

`X'K� �� #U!$"� �� J��share capital of HDFC-AMC.

HDFC ERGO General Insurance Company Limited (HDFC ERGO)

During the year, HDFC ERGO continued �� L�� L��%� �� fourth largest private sector player in the general insurance industry. '��&� �� %��!

��%�� L� ��&��&� ��&� �� %�� L� ��&��&� �� %��!�� %�� `X'K� %��m�� %�� >�]� �� %�� !� ��

�� %��%��#$"��!

�� %�� [["� �� ` 2,491 crores as against ` 1,874 crores in the previous year. During �� &� �� ` 248.3 crores as against ` 141.9 crores in the ��%�� *�� \�� Party Insurance Pool (IMTPIP) and the Indian Motor Third Party Declined Risk Insurance Pool (IMTDRIP). The �� *\��*�� *\�X>*��were ` 66.4 crores (previous year ` 181.6 crores). Thus the profit �� %� �� ` 181.9 crores (previous year loss of ` 39.7 crores). The overall �� ` 154.5 crores as against a loss of ` 39.7 crores in the previous year.

�� U:!�"��:�:"��\��[:&�Q;:[��%�� %��J��:�;"!

`X'K� �� /[!U"� �� J��share capital of HDFC ERGO.

HDFC Property Funds

`X'K��K��b��=`�Kb@�� %�� `X'K�Property Fund, a registered venture capital fund with the Securities and Exchange Board of India (SEBI).

HDFC Property Fund currently has �� !� �� HDFC India Real Estate Fund (HI-REF), with a corpus of ` 1,000 crores, �� !��ended on June 17, 2012, however, ��

a period of one year. As at March [:&�Q;:[&��at `�[/U�� %��!

��&�`X'K�*��K��Fund has a corpus of ` 464.40 crores. �� %�� *��!� �� on June 28, 2012, however, it has �� year. As at March 31, 2013, the �� ` 409.26 �� %� ��!

`X'K� �� $;!#"� �� J��share capital of HVCL.

`X'K� �� b��=`��b@��services to Indian and overseas asset ��%�� =�\K�@!�+�� \K�� %� ��advise Indian and offshore private equity funds. During the year, HPVL �� ` 3.05 crores.

`X'K��:;;"��J��capital of HPVL.

GRUH Finance Limited (GRUH)

�>{`��%�� L� �� :[�� spread across 7 states. During �� &� �>{`� �� %� �� ` 2,174 crores as �� ` 1,487 crores in the ��"!�As at March 31, 2013, the loan portfolio stood at ` 5,438 crores, ��%� �� %�� [�"� �� previous year. The average size of loans stood at ` 7.36 lacs.

For the year ended March 31, 2013,

24

�>{`� �� `� :�#!$$� �� ` 120.34 crores in the previous year <��Q:"!

`X'Km�� %� �� >{`� ��#U!/"!

HDFC Sales Private Limited (HSPL)

`X'K� +�� b�� =`+�b@�cont inues to st rengthen the K��m�� L��%� �� %�� !

HSPL has a presence in 81 locations. During the year under review, HSPL ��%��"��`X'K!

`+�b� �� of HDFC.

Credila Financial Services Private Limited (Credila)

K�� *��m�� &� ��%�loans to students pursuing higher �� *�� !� ��on March 31, 2013, Credila had ��` 892 crores �� :;&/;;� ��!� �� %��` 8.3 lacs.

*�� %� ��and sourcing applications through the ��&� K�� `X'Km�� L� �� L��!

The Reserve Bank of India has categorised education loans as �� m� ��%!� K��m�� +��$;��*�� &�:U�:!

`X'K� �� $U!:"� �� holding in Credila on a fully diluted ��!

Particulars of Employees

`X'K� �� :&$[[� �� March 31, 2013. During the year, 13 ��%��of `��;��!

In accordance with the provisions of +�� Q:/=Q�@� �� K��&� :U#�� &� �� X��m�>��!�*��+��Q:U=:@=�@=��@� �� K�� &�:U#�&��X��m�>��%�sent to all the shareholders of the Corporation excluding the annex. Any ��%�� the Corporation.

Employees Stock Option Scheme (ESOS)

Presently, stock options granted to �� %� �� +]+<;#&� �+]+<07, ESOS-08 and ESOS-11. There �� of the options granted under any of ��!

ESOS-05, ESOS-07 and ESOS-08 (Schemes)

No fresh options were either granted �� +��!�During the year, an aggregate of 29,38,799 options of ` 10 each were exercised. Pursuant thereto the Corporation received ` 551.97 crores as exercise consideration (excluding tax), of which ` 2.94 crores was towards share capital and ` 549.03 ��!�*��all 1,46,93,995 equity shares of ` 2 each were allotted to the concerned ��!� *�� provisions of ESOS-05, the last date for exercise of the options was ]��Q�&�Q;:Q!

During the year, 12,922 options lapsed, while options in force as on March 31, 2013 stood at 34,27,390.

ESOS-11

�� [��%��%�held on July 8, 2011, you had approved the issue of 58,67,546 s to c k o p t i o n s r e p r e s e n t i n g 2,93,37,730 equity shares of ` 2 �� K��!� �� K�� K�� K�� %� �� May 23, 2012, granted the said options together with options lapsed ��=�%%�%��%�2,34,929 options). In the aggregate, 61,02,475 stock options of ` 10 each were granted representing 3,05,12,375 equity shares of ` 2 each at an exercise price of ` 635.50 per equity share under ESOS-11.

�� in accordance with the pricing �� !!� �� %� �� equity share of the Corporation on �� +�&� �� %� �� K��K�� were granted. The options granted will vest over a period of 1 to 3 years �� %��&� ��%�� %��%�a continuous service of three years with the Corporation. The options �� vesting. None of the options granted have vested during the year (and ��J��&��exercised). As at March 31, 2013, 31,200 options have lapsed and 60,71,275 options are in force. Under ESOS-11, 20,86,000 options �� %�� $[� ��%�� &� �� the

25


%�� %�� %�� %� ��Managing Director and the Vice K�� K�� ]��!�� %�� was 6,000.

�� %�� J�� :"� �� total issued and paid-up share capital of the Corporation as on the date of grant.

Fair value

Since options were granted at the ��L�� &� �� of the option is nil. Consequently, the accounting value of the option =�� @� �� !�However, if the fair value of the options using the Black-Scholes �� &� ��%� �� %��&� �� =��@� �� %�� ` 157.93 crores and the ��%��+��=��+@��` 30.80 and ` 30.42 respectively.

��L��?��L<+�� %� ��fair value under ESOS-11, as on the date of grant, are (a) risk-free interest ��$!;�"�=�@� ��Q�years (c) expected volatility of share �� :#"� �� =�@� �� %��Q;"!��L��the equity share on the date of grant ��%��` 629.10 to ` 643.45.

All the options were granted at an exercise price of ` 635.50 per share and hence the weighted average exercise price is ` 635.50 per share. The weighted average fair value of the option granted under ESOS-11 =��%� �� ?��L<+�� @�

works out to ` 474.56 per option of the face value ` 10 i.e. ` 94.91 per share of the face value of ` 2 each.

The diluted EPS is ` 31.45 as against ��+��` 31.84.

Unclaimed Dividend

As at March 31, 2013, dividend ��%� �� ` 11.61 crores had �� of the Corporation. The Corporation �� %� ��concerned shareholders requesting �� IEPF. The Corporation continues to take various initiatives to reduce the J��!

As per the provisions of Section Q;#K� �� K�� &� :U#�&�� %� ��` 52.39 lacs for FY 2004-05 was ��*��'��+��/&� Q;:Q!� '��&� �� dividend in respect of FY 2005-06 ��August 24, 2013, failing which it will �� *��'� �� [;��!�*�� &� �� would lie against the Corporation or the IEPF after the transfer.

*�� *��'� ={��%�� %��%� �� %�� @� >��&� Q;:Q&�which was notified on May 10, Q;:Q&� �� K�� the relevant disclosures to the Ministry of Corporate Affairs (MCA) �%��%� �� &�along with interest accrued thereon. The Corporation has uploaded the ��www.iepf.gov.in and www.hdfc.com.

Unclaimed Shares

X�� p rov ided in the sec t ion on �+��m� *��m� �� annual report.

Particulars Regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars regarding foreign exchange earnings and expenditure �� *�� !� Q#!:� ��26.3 in the Notes to the Accounts. Since HDFC does not own any ��%� ��&� �� particulars relating to conservation ��%��%�� K��(Disclosure of Particulars in the Report of the Board of Directors) >��&�:U$$&��!

Directors

In accordance with the provisions �� K�� &� :U#�� the Articles of Association of the Corporation, Mr. Deepak S. Parekh, \�!� �� \��&� \�!� X!� \!�Sukthankar and Mr. Nasser Munjee ��%� ��\!� �� %�� <��!

Necessary resolutions for the �<�� notice convening the ensuing AGM.

All the directors of the Corporation �� J��%�� +��Q/�=:@=%@��K��&�:U#�!

X�!� +!� �!� X�� K��m�� HDFC Life. This is in accordance with K��U��%��%��&�which requires the Corporation

26

�� `X'K� b�&� �� *�� of the Corporation.

Auditors

Messrs Deloitte Haskins & Sells, Chartered Accountants, having �%�� ::/[��O&�statutory auditors of the Corporation �� K��m�� *�� b�� +��%�� until the conclusion of the ensuing ��\��%��!

The Corporation has received a �� \�� X��Haskins & Sells to the effect that �� &� �� &� ��+�� QQ�=:?@� �� K��Act, 1956.

\��'&�K��&��%� �%�� :;�� \�� &�{!�!�!�� auditors to audit the accounts of the K��m��X��!�� %��\��%��!

Directors’ Responsibility Statement

In accordance with the provisions of +��Q:/=Q��@��K��&�:U#�� %��&� ��

i. In the preparation of annual �� & � �� %��followed;

ii. Accounting policies selected were ��!�>�� %�� give a true and fair view of the state of affairs of the Corporation as at the end of March 31, Q;:[� �� Corporation for the year ended on that date;

��!� �� L��of adequate accounting records in accordance with the provisions �� K��&�:U#�� safeguarding the assets of the Corporation and for preventing and detecting frauds and other irregularities;

iv. The annual accounts of the K��%��%��!

Management Discussion and Analysis Report, Report of the Directors on Corporate Governance and Business Responsibility Report

In accordance with Clause 49 of the ��%��%��&��\��%��Discussion and Analysis Report and the Report of the Directors on K�� this report.

SEBI vide Circular No. CIR/CFD/DIL/8/2012 dated August 13, 2012,

�� ?��>��>��=?>>@�as part of the Annual Report for the ��:;;� �� L�� ?+�� b�� +��L�� %� �� *�� b�� March 31, 2012. Accordingly, your Corporation has prepared a BRR �� !�\��receive a physical copy of the BRR are requested to write to the Corporation.

Acknowledgements

The Corporation would like to acknowledge the role of all its ��L��<��&��&�channel partners, depositors, key partners and lenders for their continued support to the Corporation.

The directors appreciate the guidance �� %��authorities including NHB, RBI, +�?*&�\K�&�>%��K��&�Financial Intelligence Unit (India), '��%�� *�� Board, the Stock Exchanges and the Depositories.

Yo u r d i r e c t o r s v a l u e t h e ��of the Corporation who have relentlessly worked in challenging ��stood the Corporation in good stead.

]��?��X��

MUMBAI�� X��+!��>��`May 8, 2013 K��

27


Report of the Directors on Corporate Governance

��%��%�%��%��!��%��L��%��&��%��%!�+��%��!��<��<<��L�%��!�� L��L��%&��L��&��<��%�� %� ��<�� %�� &� ��%<�� %�� !� ?�� %�%��procedures versus the actual internalisation of governance principles within an organisation.

��%��%��%��!�`��&��%��!�*��*��&��%��!�*��%��*��!�+��&�� %��!�]��%��&��L��+��and Exchange Board of India (SEBI) and the Ministry of Corporate Affairs (MCA) to ensure that Indian corporates adopt good governance practices and follow high standards of disclosures.

��L��%��*��!�*��+��Q;:Q&��\K��%��%��K��m!��%��%��!�*��X��Q;:Q&��K��?��&�Q;:Q��b�L�+�� =�� *��@!�� %��!�*��Q;:[&�+�?*��>��K��*��m��%��K��U��%��%��K��?��&�Q;:Q!��%��%��corporate governance.

Corporate Governance at HDFC

`X'K��%��%� ��&��&��&��%��&��L��!��K��%��%��%��%<��%��%�� L��&� ��%� ��its sphere of operations.

*��%��&��`X'K!��%��across the Corporation.

��?��X��%�� %��%��!�`X'K� �� %�� %<��!

�� ?�� X�� %� �� %�� %��L��%��%��!��%�� K��U� �� %� �%��!� �� K�� J��K��%��!

Board of Directors

Composition

��?��X��!��< ��%��K�� K��!� �� <�� K��K�� ]�� =K�]@&� ��Managing Director and the Executive Director. Of the eleven non-executive directors, ten are independent directors. The ��K��U�*�=�@�=��@��%��%��!��K��!

28

�� %� �� %� �� L��!� ?�� &� �� !� �� K�� U� *� =�@� �� %��%��!�X��?��X��~��= ��%�`X'K@��

Sr. No. Directors Number of Directorships

Number of CommitteesMember Chairperson

1 \�!�X��L�+!��L��=K��@ 8 6 22 \�!��\��=��K��@ 4 - -3 Mr. Shirish B. Patel 1 - -4 Mr. B. S. Mehta 14 9 55 Mr. D. M. Sukthankar 3 2 16 Mr. D. N. Ghosh 4 - -7 Dr. S. A. Dave 10 6 28 X�!�>��+!�� 10 6 19 Mr. Nasser Munjee 14 9 5

10 X�!�?�� - - -11 Dr. J. J. Irani 3 1 -12 Mr. V. Srinivasa Rangan (Executive Director) 13 9 -13 \�!�>��+��=\��%��%�X��@ 13 6 414 \�!��L��\!�\��=��K��K�]@ 14 10 4

Mr. Deepak S. Parekh is the non-executive Chairman of the Corporation.

Sr. Nos. 2 to 11 are independent directors. Sr. Nos. 12 to 14 are whole-time directors.

The number of directorships includes directorships in HDFC group companies. Excluding the directorships mentioned above, Mr. Deepak S. Parekh is an alternate director in two companies and Mr. B. S. Mehta is an alternate director in one company.

Tenure

��< ��K��!�]�<��%��&��<��!

Responsibilities

�� ?�� X�� K��m�� L�� %� ��%<�� %��%��%��%��!��m��K��m��%��&��&��J��L��%��%�� &� �� %�� &� �� %�� %��interests of all stakeholders.

Role of Independent Directors

*��L��<��L��%��%��K��%��!��%��K��L��!

��%��K��%�� &�L��%��%�� &� ��&� ��%&� ��%��&� ��&� ��&� �� &��%��%��%�!��L��%��&� �� &��&�� !��K��their inputs in achieving its strategic direction.

29


�� K�� K�� K�� !��*��>��K��!��K��&�:U#�&�� %��%��&��!?��L��%��of the Corporation.

Board Meetings

��%��?��X��K��m��%��\��!�\��%��%�� %� ��%�� %� ��!��J��J��K��!��K��<��%��%�!��K��U��%��%��!�� K��!��&��%�� !��%��!�+��%��%��%��!��%�&�� %��L�� %� �� &��&��L��%��&��%��!��~��%��\��?��L!�� %�� K�� %�� %�� K�� %��J��!��L��L��?��X��K��%��<��!*�� K��U� ***� =�@�� %��%��&� ��K�� J��`X'K�+��b��*��K��b��=`X'K�b�@&��<��*��!��%��&��K��X�!�+!��!�X��`X'K�b�!X��%� �� &� �� !� ��%��\��/&�Q;:Q&� ��::&�Q;:Q&�]�� QQ&� Q;:Q&� �� Q:&� Q;:[� �� \�� Q�&� Q;:[!� �� <��%��35th AGM held on July 11, 2012, along with ��%��

Directors Board Meetings Attendance at the35th AGM Number of Meetings

AttendedSitting

Fees Paid(`)

\�!�X��L�+!��L��=K��@ 5 1,00,000 Yes\�!��\��=��K��@ 3 60,000 YesMr. Shirish B. Patel 5 1,00,000 YesMr. B. S. Mehta 5 1,00,000 YesMr. D. M. Sukthankar 5 1,00,000 YesMr. D. N. Ghosh 4 80,000 NoDr. S. A. Dave 5 1,00,000 YesX�!�>��+!�� 5 1,00,000 YesMr. Nasser Munjee 4 80,000 YesX�!�?�� 5 1,00,000 YesDr. J. J. Irani 5 1,00,000 YesMr. V. Srinivasa Rangan (Executive Director) 5 - Yes\�!�>��+��=\��%��%�X��@ 5 - Yes\�!��L��\!�\��=��K��K�]@ 5 - Yes

30

L��%��%�!

��\��$&�Q;:[&��inter alia��K��year ended March 31, 2013.

Committees of the Board

��K��&��%��!��%��L��<��L��%��J��%�!

Audit Committee

�� K�� !� �� X�!� +!� �!� X��=K��@&�\�!�?!�+!�\��\�!�X!��!��!��%��%�� !��J�� %�� !�� !

�� inter alia� ��%��K��m��%��!��%��&��J��~��%��for approval.

�� &� �� %� �� !� �� &� ��&��%��!� *��&� ��!��<��K��!

��m��%��J��&��&��%��&��%��J��!��m��%��K&��!��%��%��%��%��!

��J��<�� L�� %�� !� *��&��&��%��!

X��%� �� &� �� inter alia� �� ~�� &� ��%�� K��&� ��%��&��&��&�� `��%�?��L��\��%��X��>��!��K�� !� �� %�� K�� %�� L�� !� �� +��QUQ��K��&�:U#��K��U�**��%��%��!

*�� m��%�� K��%�!�+��%��%��!��K��K��!

31


X��%��&�� !��%��\��/&�Q;:Q&��::&�Q;:Q&��Q$&�Q;:Q&�]��QQ&�Q;:Q&��Q:&�Q;:[��\��Q�&�Q;:[!��K��[#th AGM to answer shareholder queries.

��%��%��

Members Number of Meetings Attended

Sitting Fees Paid(`)

X�!�+!��!�X��=K��@ 6 1,20,000Mr. B. S. Mehta 6 1,20,000Mr. D. N. Ghosh* 4 80,000

�� b�� %�� \�!� X!� �!� �� %�� ::&� Q;:Q� �� July 28, 2012.

��\��$&�Q;:[�� inter alia� �� K��\��[:&�Q;:[��!

Nomination & Compensation Committee

��K��K��!��\�!��\��=K��@&�\�!�+��?!��\�!�?!�+!�\��!

��inter alia��%��J�� K��&� ��%� �� &� ��%� �� %� �� %� �� K�� K��K��!

��%�� &��=�@�� &� �� J�� J�� K�� =�@� �� L�� =�@� �� &��|��%��%<��%��K��K��&�:U#��%��K��!

�� m�� L� ��&��%�%��%��%��!

�� !

�� %� �� !� �� %�� \�� /&� Q;:Q&� \�� Q[&�Q;:Q&��::&�Q;:Q��\��Q�&�Q;:[!��K��[#th AGM to answer shareholder queries.

��%��%��



\�!��\��=K��@� 3 60,000Mr. Shirish B. Patel 4 80,000Mr. B. S. Mehta 4 80,000

��b��%��\�!��\��%��\��Q�&�Q;:[!

32

Investor Relations & Grievance Committee

��*��>��K��!��X�!�>��+!��=K��@&�X�!�+!��!�X��\�!��!�+��>��%��!�\�!��!��&��K��&��&�� %��!

��%��]��QQ&�Q;:Q&��inter alia��%��K��&��%��~�%��K��L��J��!��%��%� �� !� �� securities laws.

X��%� ��&� �� K��&��%��*��'�={��%��%��%��%��@�>��&�Q;:Q!

X��%��&��!��%��%��:;&�Q;:Q&�]��::&�Q;:Q��:�&�Q;:[!��%��%��



X�!�>��+!��=K��@ 3 60,000

Dr. S. A. Dave 3 60,000

Mr. V. Srinivasa Rangan 3 -

Investor Grievances

��K��%��<��&�[email protected]��%��!�X��%��&��K��#&U//��&��L��~�%��%�<��J��%�� &� ��~�� &� �� ~�<�� &� ��<�� &��%��%��~��L��&��%��K��!

�� %��%� �� &� �� !� X��%� �� &� ��K��Q;��&��\��[:&�Q;:[!

Presently, the Corporation is a party to litigations relating to disputes over title to shares. The Corporation is not in �%��%��!

�� K�� L� ��%&� +�?*� �� %��L��!

Employee Stock Option Scheme (ESOS)

At the 34th AGM held on July 8, 2011, the shareholders had approved the issue of 58,67,546 stock options representing 2,93,37,730 equity shares of `�Q��K��+]+<::!�X��%��&��K��K��%��%��Q&[�&UQU��&��%%�%��%��:&;Q&�/#��L��&� ��%�[&;#&:Q&[/#�J��

33


` 2 each at an exercise price of `��[#!#;��&��%��L��+�?*�=��+��L�]��+��+��L��+��@��&�:UUU&��!��J��+�?*�%��X��m�>��!

Code of Conduct

��K��K��K��&��?��X��!��%��K��K��m��&�www.hdfc.com.�X��%��&��%��%��!�'��&��%��the code.

Share Dealing Code

��K��+��X��%�K��&��+�?*� =�� *��%@�>%��&�:UUQ&��!�X��%��&� ��%��%��%��!

�� %�� %� �� K��!��&��!�� %� �� K�� %� �� %� �� K��&�� %��of the Corporation.

'��&�� L��&��%�� K�� %� �� L� ��%��!!��%�� %��L��%��J��K��!

*��&��%��K�� %�� K��K��%�� !�� %�� K��&� ��%�� %� ��%� �� !��%��L��positions in derivative transactions in the equity shares of the Corporation.

Disclosures

Transactions with Non-Executive Directors

��\��[:&�Q;:[&��< ��K��` 25.01 crores. The �� !��< �� K��K��&��%��&��&��!

Related Party Transactions

�� %�� &� �� %��&� �� |�� K�� %!��K��K��!��&�� &� �� m��%��!�X��K��%��!

34

Accounting Standards

�� K�� %� +�� K�� =��%�+��@� >��&� Q;;�!� �� +��*��\K�!

Secretarial Standards

��K��+��+��*��K��+��of India.

Risk Management Framework

O��%��L��%��K��L��%��&��K��>��L�\��%��'��L!�� >��L� \��%��'��L� �� L�&� �� K��L��%��!��L��&��L��L��!

��%��%��K�� %&��%��%��L��%��~��J��!��>��L�\��%��K��=>\K@� �� \��%��%� X�� &� �� X�� %��&� �� %� �� %�&� �� %&��%��%��L��K��!��%��&��>\K��L��L��&��L��%��!

Proceeds from Private Placement Issues

X��%��&��K��+��>��<K��X��` 10 lacs each, aggregating to `�[[&:$;��&��!��%��%��%��K>*+*b��m��*K>��m��K>*+*b��*K>��!

�� &� �� %� �� %��!�X��K��!

Remuneration of Directors

Non-Executive Directors

�� L�%� �� < �� %� �� !� �� < �� K�� < ��&� �� \�!�X��L�+!��L�� K�� K��!��< ��K��!

'��\��[:&�Q;:[&��< ��&��\�!�X��L�+!��L�&��`�:;��&��&��!�X��%��&��< ��&��\�!�X��L�+!��L�&��%��/&;;;��L��+]+<::!�]��+]+<::��\��Q[&�Q;:[�� #��!

\�!�X��L�+!��L�&�K��&��`�:!$;��&��K��K��&��!�`��`�[!�;��%��%��~��%��%��:&�;&;;;��L��+]+<::!

35


Shareholding of Non-Executive Directors

��%��K��< ��\��[&�Q;:[�

Name Number of Shares

\�!�X��L�+!��L��=K��@ 16,00,000\�!��\��=��K��@ 3,60,000Mr. Shirish B. Patel 1,83,500Mr. B. S. Mehta 4,00,000Mr. D. M. Sukthankar 1,88,800Mr. D. N. Ghosh 1,72,935Dr. S. A. Dave 2,68,550X�!�>��+!�� 4,07,500Mr. Nasser Munjee 9,385X�!�?�� –Dr. J. J. Irani 50,000

Executive Directors

�� K��&� ��\�&��#��!��L�%�� &� ��J�� =J�� @&� �� K��m��&��K��m��= ��K��@&��&��&��&��&��K��&��<��K��m��~��K��~�� K�� K��&� �� <��K��K��K��\�!

�� L��K��K��!�+��%�� K��!

��~��

Name Salary(`)

Perquisites, other

allowances & retirement

� � ��(`)

Commission payable 2012-13

(`)

Total(`)

Stock Options granted under

ESOS-11

Present term expires on

\�!��L��\!�\�� 1,35,45,000 1,44,50,744 3,87,00,000 6,66,95,744 2,80,000 ��:[&�Q;:#\�!�>��+�� 1,24,05,000 1,41,97,658 3,54,00,000 6,20,02,658 2,80,000 X��[:&�Q;:�Mr. V. Srinivasa Rangan 76,50,000 83,74,574 2,25,00,000 3,85,24,574 1,50,000 X��[:&�Q;:�

Management Discussion and Analysis Report

��\��%��X��>��X��m�>��!

36

Shareholders

��K��:&$U&;;;��\��[&�Q;:[!�� shareholders is through the annual report which inter alia��K��m��+��&��X��m�>��&��>�� ?��X��K��&�\��%��X��>��&� ��m�>��&��K��m�>��&�?��>��>��&�+��*��+��m�*��!

��\�� &��J��!��L��%��%��%��&��%��!

��K�� %��%��%��%��!��K�� !��%��K��m��&�www.hdfc.com.>%�� K��m�� %�� %� �� !�X��%��J��%��K��m��!��%��?��+��&�?��b��L��!��K��J��<��%��<��K��X��!

�� &� �� %�� *��+��K��&��%��+��X��!��L��!

�� <�� [�th AGM is provided as an annex to the notice convening ��\!��+��m� *��m��J��K��U��%��%��!

��%��%��\��%��X��>��!

Annual General Meetings (AGM)

�� \�� %�� !� �� \�� ?�� \�� +��%��&� :U&� ��\��b��&�\��;;�;Q;!

Financial Year

Meeting Date Time Number of Special Resolutions

passed

Brief particulars of Special Resolutions

2009-10 33rd AGM July 14, 2010 [!;;��!�! 1 �� %� �� J��K��` 10 per equity share to ` 2 per equity share.

2010-11 34th AGM July 8, 2011 [!;;��!�! 1 �� %��L�� %��K�� +�?*� =�� +��L� ]��+�� +��L� ��+��@��&�:UUU!

2011-12 35th AGM July 11, 2012 [!;;��!�! 1 *�� %� �� '��%�� *�� *�� :;;"��*��+��!

�� \&�� K��%� �� %%�%��#/!/["�� J�� %�� +��:$/�� K��&�:U#�!

��%��%��at the ensuing AGM.

37


Compliance

�� K�� J�� K�� U� �� %��%��!��K��J��%��L� ��%��!

\��!�b!�?��&��%��&��K��J��K��U��**��%��%��!�� X��m�>��L� ��%��\K��%��report.

Non-Mandatory Requirements

��K��K�� !

��K��K��%��!��K�� [#th� ��\� �� J��!� �� %��!

��J��K�� %��&��K��m��<�� %��<��with their Depository Participants/the Corporation.

��K��%��J��!

��?��X��K��J��%��!

��K��K��O��*��m&��<��%��%��&��&�� K��m�� &� ��!��%��K��%��L��!

��%��<��J��L��%��%��!

� ��

*��K��U�� %��%��&��%� �� &��J�� K�� L��%��K��under review.

Going Concern

��K��J��J��%��%��%��!

� ]��?��X��

MUMBAI� X��+!��>��`\��$&�Q;:[� K��

*��&��%��provisions of the Code of Conduct.

MUMBAI ��*�\!�\*+�>�\��$&�Q;:[�� K��K�]

38

��

TO T H E M E M B E R S O F H O U S I N G D E V E LO P M E N T F I N A N C E CORPORATION LIMITED

O�� conditions of corporate governance ��`]{+*��X��b]�\��'*��K��CORPORATION L IMITED (“ the Corporation”) for the year ended 31st March, 2013, as stipulated in �� U� �� b��%� �%��of the said Corporation with the stock exchanges.

�� of corporate governance is the �� \��%��!�]�� &�� K�� %� �� the conditions of the corporate governance. It is neither an audit nor an expression of opinion on �� Corporation.

*�� %� �� explanations given to us, we certify �� K�� with the conditions of corporate governance as stipulated in clause �U��b��%��%��!

O��is neither an assurance as to the �� K�� \��%��has conducted the affairs of the Corporation.

For N. L. Bhatia & Associates� K��+��

N. L. BhatiaMUMBAI FCS - 1176May 8, 2013� K��!��QQ

39


Review of the Chairman of the Audit Committee of Directors

��K��X��!��J��%�� !��K��&�:U#��K��U�� %��%��!�X��%� �� &� �� !�\��/&�Q;:Q&� ��::&�Q;:Q&��Q$&�Q;:Q&�]��QQ&�Q;:Q&��Q:&�Q;:[��\��Q�&�Q;:[!��%��&��<��=��@��K��<��J��[;&�Q;:Q&�+��[;&�Q;:Q��X��[:&�Q;:Q&��K��!�� \�� $&� Q;:[� inter alia �� K��\��[:&�Q;:[&��%��!��K��m��%��&��%��&�inter alia�� J�� m� �� +��Q:/� =Q��@�� K��&�:U#�&��%��%��J��%�� !� �� %�� %��%��%�!�� ~�� K�� %��K��J��J��<��L��%��!�� J�� &� �� %� ��&� ��%� ��J��&��J��&��%��&��%��&��&��~��&��K��&��%��K��&��%��K��!��%��%��&��&��!��K��&��Q;:[<:�&��!��Q;:Q<:[!��~��K��%��Q;:Q<:[!��%��L��Q;:Q�:[!��<��*��Q;:Q<:[��!��\��X��`��L��+��&�K��\��'&�K��%��K��K��m��&��*��b��+��%��X��K��Q;:[<:�&��&��!

Dr. S. A. DaveMUMBAI� � �� K��\��$&�Q;:[� � ��K��X��

40

Review of the Chairman of the Investor Relations & Grievance Committee of Directors

�� *�� >�� K�� X�� &� �� %� ��!�X��%��&��!��%��:;&�Q;:Q&�]��::&�Q;:Q��:�&�Q;:[!

X��%� �� &� �� inter alia �� K��&� �� ~�� %� �� J�� K��&��L��J��%��%��&��&��L��%��&��&��%��K��&��%��~�%��K��%��!

X��%� �� &� �� %� ��%��~�� *�� '�� =*��'@� �!!&� ��!��!%��!�� K�� !!& ��!��!��&� �� *��'� ={��%�� %��%�� %��@�Rules, 2012.

��:#&�Q;:[&��inter alia��K��&��m��J��\��[:&�Q;:[��+��]��%��K��!

��<��K��?��X��+�� %�?��*��=+�?*@&��K��!�K*>~\*>+�~/~Q;:Q��#&�Q;:Q&��+�?*!

�� K��%��and depositors.

Dr. Ram S. TarnejaMUMBAI� K��:#&�Q;:[�� *��>��K��X��

Review of the Chairman of the Nomination & Compensation Committee of Directors

��inter alia��%��%��<��K��&��K��K�� L�� K��!� *�� %��K��&��%��%��!�

X��%� �� &� �� !� \�� /&� Q;:Q&� \�� Q[&� Q;:Q&� �� ::&� Q;:Q� �� \��Q�&�Q;:[!�� <�� K��!��K��K��&��!

��<��%��%��K��$&�Q;::&��58,67,546 stock options of ` 10 each representing 2,93,37,730 equity shares of `�Q��K��K��+��L�]��+��Q;::�=�+]+<::@��%��!

�� %� �� \�� Q[&� Q;:Q&� %�� %� �� !�*��:&;Q&�/#��L��` 10 each, representing 3,05,12,375 equity shares of ` 2 each were granted under ESOS-11, at a price of `��[#!#;��&��%��%��J��K��%��+��L�� %��*��b��!�

Keshub MahindraMUMBAI� K��\��&�Q;:[� ��K��K��X��

41


Management Discussion and Analysis Report

Macroeconomic Overview

During the year under review, *��m�� X�� %�� L�� slowdown owing to a persistently ��L� �� !� *�|��&��&� �%�� %�� !��%��%�U!�"��'�� Q;::� �� $!U"� �� '�� Q;:Q&� ��headline wholesale price index in FY Q;:[� ��%�� /!�"!� �� >��Bank of India (RBI) reduced the repo �� :;;� �� &� �� /#��+�� b�J��>��:;;�� %� �� %�� liquidity conditions.

�� %��investors (FIIs). The net FII equity ��|��*��{+X�Q��'��Q;:[��|��{+X�U��!

�� %�� #!Q"� �� X�� '�� Q;:[�� #!/"� �� year. However, the current account ��=K�X@��%��!/"��X��J��of FY 2013. With the recent decline �� &� �� and gold, the CAD is expected to ��!

Market Scenario

�� %�� housing loans. Given the acute shortage of housing in the country, ��%�%��&� �� L��%!

Measures on the housing sector in the Union Budget 2013-14 p�� %!� ��

Union Budget increased the existing interest rate deduction of ` 150,000 �� %� �� <�� of `� :;;&;;;� �� &� �� and property cost does not exceed ` 25 lacs and ` 40 lacs respectively. ��%�include the increase in the Rural `��%�'��` 4,000 crores to ` 6,000 crores and the introduction �� {�� `��%� '�� initial allocation of ` 2,000 crores.

Interest Rate Scenario

Owing to inflationary pressures, ��J��%�� &��%�|��inverted. Though the RBI reduced the ��:;;��%�� &� �� !� ��%� �� K��m�� &� ��Corporation reviewed its Corporate �� b��%� >�� =K�b>@� �� <��>��Lending Rate (RPLR) during the year.

Lending Operations

Loan approvals during the year were `� :&;[&Q�;� �� ` 90,154 crores in the previous year. b��` 82,452 crores as against ` 71,113 crores in the previous year.

K�� \�� [:&�2013 were ` 5,66,660 crores and ` 4,56,098 crores respectively. This �� !�� housing units.

The average size of individual loans stood at ` 21.6 l��` 19.5 lacs in the previous year.

Assignment /Sale of Loans

The Corporation, under the loan ��%�� %� �� ` 5,125 crores to HDFC Bank pursuant to the ��L� �� %�� the Corporation and HDFC Bank. The Corporation also sold ` 50 crores of its non-individual loan portfolio. The ��%��year stood at ` 5,175 crores.

As at March 31, 2013, total loans outstanding in respect of loans sold/assigned stood at ` 16,964 crores (inclusive of Rs 247 crores non-individual loans). HDFC continues to service these loans and is entitled to the residual interest on the loans sold/assigned.

The residual interest on the individual �� ~��%�� :![["� ��!� �� %��%��the life of the underlying loans, and �� !� ��%��~��%�� agencies and carry a rating indicating the highest degree of safety.

Loan Portfolio

The loan approval process of HDFC is decentralised, with varying approval ��!��%�� %�� =K]\@!�Larger proposals, as appropriate, are referred to the Board of Directors.

X��%� �� &� `X'Km�� L�increased to `�:&/;&;��` 1,40,875 crores in the previous year. In addition, loans securitised ��~�� %�� K��and outstanding as at March 31, Q;:[��nted to ` 16,964 crores.

42

The net increase in��L��`�QU&:/:��after taking into account loan �� ` 48,089 crores (previous year ` 42,362 crores) and loans written off during the �� %� �� ` 16.61 crores (previous year ` 26.18 crores).

The growth in the individual loan ��L&� �� %� ��L� �� %� :Q� �� [:"� =Q#"� �� @!� � ��<�� %�� :["!� ��%�� L� ��%� ��L� �� Q�"�=Q:"��@!

]� �� L&� �� $"!� '��&� $:"�� %�� L��%��individual loans.

Dual Rate Home Loans (DRHL)

*��Q;;U&� ��K�� product with dual interest rates. �� X>`b� ��

period up to March 31, 2012 and thereafter the loan switches to a |��%��L��>�b>!�O�� :&� Q;:Q&� �� X>`b�were converted to floating rates loans, linked to the RPLR.

As per National Housing Bank (NHB) guidelines, the Corporation �� %��%��Q"��X>`b�up to one year after the interest rates were re-set. Accordingly, with effect ��:&�Q;:[&��K��&�� %�� higher provisioning on these loans.

Marketing and Distribution

`X'Km�� L� ��[[:��&��$:�� &�`X'K�+��b��(HSPL). In addition, HDFC covers over 90 locations through outreach ��%��!

��channels such as HSPL, HDFC Bank and third party direct selling associates during the year accounted ��$U"�� `X'K� �� !� �� %�� K�� %�� and loss account upfront and is not �� !�� %� �� `�Q#U��%�� %��!

Investments

��*��K�� ?�� X�� %��?��Xirectors.

�� %�financ!� �� includes ensuring adequate levels �� J�� J��&� ��%� �� %��%�� %�the level of returns, consistent with ��L!

��\��[:&�Q;:[&��portfolio stood at ` 13,613 crores as against ` 12,207 crores last year. The �� /"!

`��%� '�� K�� =`'K�@��J��liquidity ratio (SLR) in respect of ��!�K��+b>� �J�� :Q!#"��deposits. As at March 31, 2013, HDFC had `� Q&�:[� �� L��`?��` 2,774 ��%��!

As at March 31, 2013, the treasury �� = ��%� ��in equity shares) had an average �� QU��!� �� %� �� non-equity portfolio for the year was :;!$["��!

`X'K�� % < � � ��!��L��L�m!�*�� %<��&��|�� !��%%�%��provision on account of such current ��%<��to ` 70.62 crores. After considering �� %� �� ` 63.54 �� &� �� L� �� s sold, a provision of

Loans Outstanding( ̀in crores)

85

,19

8

97,9

67

0

30000

60000

90000

120000

150000

180000

20132012201120102009

117

,127

140

,87

5 170

,04

6

43


`� /!;$� �� %�� K��%�� !

�� \�� [:&� Q;:[&� �� L�� J�� %�� ` 30,698 crores as �� |�� !� �� gain includes appreciation in the ��L��`X'Km�� &�`X'K�*��b��`X'K�`��%��b��!�*�� the unrealised gains on the unlisted ��!��\��/&�Q;:[&��%&� �� %�� ` 34,145 crores.

Subsidiaries and Associates

��%�� %� �� &� `X'K� �� L� �� !� �� where there are strong synergies with HDFC. HDFC will continue to explore ��%��%��`X'K��!

X��%� �� &� `X'K� �� %�� J�� -- HDFC ERGO (` 22.6 crores), H T Parekh Foundation (` 10 crores), `X'K� �� X��+��b��=` 2 crores) ��`X'K�>��b��=` 2 crores). In addition, during the year, an ��` 20 crores was invested �� Credila Financial Services Private b��!

The shareholding of HDFC (together ��@��L��

�� \��[:&�Q;:[��

Company Shareholding %`X'K�X��b�� 100.0`X'K�*��b�� 100.0`X'K�`��%��b�� 100.0`X'K��K��b�� 100.0`X'K�>��b�� 100.0`X'K��b�� 100.0`X'K�+��b�� 100.0`X'K��K��b�� 100.0`X'K��X��+��b�� 100.0H T Parekh Foundation 100.0K��'��+��b�� 89.1`X'K��K��b�� 80.5`X'K��>�]��*��K��b�� 73.9`X'K�+��b��*��K��b�� 72.4`X'K��\��%��K��b�� 59.8�>{`�'��b�� 59.7`X'K�?��L�b�� 22.8

^ On a fully diluted basis

*Inclusive of shareholding of HDFC Investments Limited and HDFC Holdings Limited

Recoveries

�� <��%� ��=��@� �� is overdue for 90 days. Gross ��<��%� �� %�� ` 1,199 crores as at March 31, 2013, constituting ;!/;"��!��outstanding in respect of individual �� ;!#$"� ��the individual portfolio and the ��%� �%�� ;!U:"�in respect of the non-individual portfolio. HDFC has written off loans aggregating to ` 16.61 crores during the year. These loans have �� <�� &� �� `X'K� ��L��%��!� `X'K� ��&� �� &�� =��J��recovery) aggregating to ` 153.05

crores. Thus as at March 31, 2013, the total loan write offs continues �� inception of the Corporation.

Provision for Contingencies

During the year, the Corporation �� %��of ` 145 crores (previous year – `� $;� ��@� ��%�� !�� assets consequent to the change in ��%�� assets.

�� `?&�`X'K��J��to carry a total provision of ` 1,506 crores of which ` 387 crores is on �� <��%� �� ` 1,119 crores is in respect of general provisioning on

44

Number of Outlets*

267279

289311

331

0

50

100

150

200

250

300

350

20132012201120102009

* Inclusive of outlets of wholly owned distribution company

standard loans, including Dual Rate `��b��%!�Thus the Corporation carries an additional provision of ` 286 crores ��%��J��!

During the year, HDFC has utilised `�Q[!/;�� %�� write offs. After taking into account the transfers as well as the net ��&� �� for contingencies as at March 31, 2013 stood at ` 1,792 crores.

Fixed Assets

�� \�� [:&�Q;:[� �� ` 237.94 crores (previous year ` 233.95 crores).

Subordinated Debt

��\��[:&�Q;:[&��K��m��%� �� stood at `� [&�/#� ��!� �� K��%�� %�� %� �� K>*+*b� ��*K>�!� � ?�� &� �� \�� [:&� Q;:[&�`� Q&U$#� �� L� �� as Tier II under the guidelines �� `?� �� J�� !�The Corporation did not issue any ��%��!

Borrowings

Borrowings as at March 31, 2013 �� ` 1,58,828 crores as against ` 1,39,128 crores in the previous year - an increase of :�"!� ?��%�� $:"�� \�� [:&�Q;:[!�]��%�&�� #�"&��[["��::"!

Foreign Currency Borrowings

The outstanding foreign currency ��%�� %��'K�>� =?@� �� L�� ={+X� #��!#:��@&� �� X�� ?��L�under the Housing Finance Facility ��={+X��Q!#:��@��O��=��[!;/��@!

Deposits

As at March 31, 2013, outstanding deposits stood at ` 51,933 crores. �� :#!�� !�X�� /U"� �� %�� %� ��year.

CRISIL and ICRA have for the e ighteenth consecut ive year, �� K>*+*b� '��m� ��*K>�� \��m� ��%�� `X'Km�� !� �� %��represent the highest degree of �� %��%� �� %� ��%��the lowest credit risk.

`X'K� �� L��%� �� %��

�� !� ��L��%� �� L�� and the period of deposit and is ��<�� deposit. In addition, agents who achieve certain collection targets are paid an incentive every year.

Term Loans from Banks, Financial ��

As at March 31, 2013 the total loans ��%��L�&�� `?� �� ` 17,824 �� ` 40,697 crores as at March 31, 2012. The ��%��due to a reduction in the outstanding ��L� ��!� �� ?�� >�� L��%��review, the Corporation reduced �� L� �� L��%��and deposits.

Non-Convertible Debentures (NCD)

During the year, the Corporation ��KX��%� ��` 33,180 ��!�� K��m�� KX� �� O�� X��\��L��%��+��L�� %��*��b��=�+�@�� ?+�� b��!� �� K��m��KX��%��%��%� �� m� �� K>*+*b� ��ICRA.

��K�� !� {�� *��b��Account without a corresponding �� =K��%�� @!

�� &� ��Corporation has raised Zero Coupon

45


Breakdown of Borrowings (%)(As at March 31, 2013)

Deposits - 33

Domestic Term Loans - 11

Bonds & Debentures - 56

33

11

56

X�� =VKX@!� �� VKX� �� of the ZCD. The proportionate �� VKX� �� =�� @� ��%� �� `� �[$!;�� +�� in accordance with Section 78 of �� K�� !� �� \��31, 2013, the outstanding ZCD �� ` 5,040 crores as �%��` 8,302.70 �� =��%� ��preference shares).

Simultaneous Issue of Non-Convertible Debentures and Warrants on a QIP basis

Pursuant to the approval of the Shareholders at the 32nd Annual General Meeting held on July 22, 2009, HDFC raised ` 4,301 �� %�� O�� <K�� X�� *�� ?�� =�*?�@��*��=�*�@� �� provisions of Chapter XIII-A of SEBI

(Disclosure and Investor Protection) Guidelines, 2000.

In August 2009, HDFC issued and allotted 20,000 Zero Coupon NCDs of the face value of ` 10,00,000 each due August 24, 2011 aggregating to ` 2,000 crores at an annualised �� =��\@� �� /!:#"�and 20,000 Zero Coupon NCDs of the face value of ` 10,00,000 each due August 24, 2012 aggregating to ` 2,000 crores at an annualised ��\��/!$#"!��NCD of ` 2,000 crores was repaid on August 24, 2011 and the second tranche of ` 2,000 crores on August 24, 2012.

`X'K��allotted 1,09,53,706 Warrants at an issue price of ` 275 per Warrant with �� %�� O��holders to exchange the Warrants with one equity share of face value of ` 10 each of the Corporation, at any ��[�� !!� �� %��Q�&�Q;:Q&��O��Exercise Price of ` 3,000 per equity ��&� �� O�� %� ��the Warrants. Consequent to the �� O��holder had the option to exchange �� O�� J�� of face value of ` 2 each of the Corporation at a Warrant Exercise Price of ` 600 per equity share.

As at August 24, 2012, 5,47,43,150 O�� %�� exchange with equity shares of the K��&� ��%� UU!U#"�of the Warrants issued. Accordingly, the Corporation issued and allotted 5,47,43,150 equity shares of `� Q� �� of ` 3,284.59 crores. The said equity shares rank pari passu with

the existing equity shares of the Corporation.

�� %� ��Warrants were utilised to replace �� V�� K�� X�� consequently, the Corporation will not �� !

25,380 Warrants which were not �� %� �� J�� K�� :#�Warrant holders have lapsed and �� !� ��%��&� �� forfeited.

Risk Management

�� '�� >��L� \��%�� `�%��%� �� K�� exposures on currency and interest ��!� `X'K� ��%�� rate and currency risk in accordance �� %�� !� ��L��%��%��to protect against foreign exchange ��L&�� %�any opportunities for an upside, �� L�� <��%�� %��L��!

`X'K� �� %� �� L��%��!�These risks include credit risk, liquidity risk, foreign exchange risk ��L!�`X'K��%��credit risk through stringent credit ��!�b�J��L��L��%��%��%�� %�� %� �� !

`X'K��L��%��%��in order to hedge its exposure to

46

Cost Income Ratio(%)

7.6

7.8

7.7

7.9

8.8

7

8

9

10

201320122011201020092.0

2.1

2.2

2.3

2.4

20132012201120102009

2.21

2.312.33

2.30

2.27

Spread on Loans(%)

Profit per Employee(` in Lacs)

0

50

100

150

200

250

300

20132012201120102009

153

188

220

240

265

Assets per Employee(` in Lacs)

0

2000

4000

6000

8000

10000

20132012201120102009

6,5

10

7,4

26 8

,25

9 9,2

00 10

,00

0

foreign exchange and interest rate risks. The currency risk on the ��wings is actively hedged through ��&� ��%��&�principal only swaps, full currency swaps and currency options.

As at March 31, 2013, the Corporation �� %�� %�� {+X� �[Q!U�� J��!�The entire principal on the foreign �� %�� %�� swaps, currency options, forward ��&��L��%��%��!��%��&�the net foreign currency exposure on ��%�� L� ��%��%��!

In addition, HDFC has entered into cross currency swaps of a notional �� {+X� �/�!�#� ��equivalent wherein it has converted �� %�� L�� L�� respective currencies. The total net foreign currency exposure on cross currency swaps is USD 222.59 ��!��;!/�"��%��`X'K!

��%�� `X'Km�� >�� `��Loan product as well as to reduce ��%�&�`X'K�has entered into interest rate swaps wherein it has converted i�� of ` 21,185 crores as at March 31, Q;:[� �� %� �� %� �� L�� L�!�'��&�� {+X� :[;� �� J�� %� �� undertaken to hedge the interest

rate risk on the foreign currency ��%�!

Revaluation of Foreign Currency Assets and Liabilities

�� %�� L� ��%��%�� the rates of exchange prevailing at the year end, where not covered

�y forward contracts. Wherever HDFC has entered into a forward �� &�� &� �� %�contract, the exchange difference is ��%� �� contract.

Cross Currency Interest Rate Swaps ��L��%��%�� to the spot rate.

47


Expenditure Goes Towards(%)

95

5

Interest & Other Charges - 95

Staff, Establishment, Other Expenses, Depreciation and Amortisation and Provisionfor Contingencies - 5

Expenditure & Other Charges: ` 14,575 crores(PY ` 11,689 crores)

Income Comes From(%)

Operating Income - 98

Other Income - 2

98

2

Total Income : ` 21,148 crores(PY ` 17,354 crores)

Asset Profile (%)

87

7

6

Portfolio (Loans, including debentures & corporate deposits for financing housing and real estate projects) - 87

Investments - 7

Fixed and Other Assets - 6

Administrative Expenses toAverage Total Assets

(%)

0.0

0.1

0.2

0.3

0.4

0.5

20132012201120102009

0.29 0.30 0.30

0.35

0.30

The net loss/gain on translation �� %<�� %�� !�� %� ��is carried in the Balance Sheet as ��%�� m!��net loss/gain on translation of short-

�� in foreign currencies is recorded in ��+��b��!

��\��[:&�Q;:[&��` 169.79 crores (without considering �� ` 57.71 crores) is carried forward in the foreign �� !��

�� ~�� %��%�up to six years.

Asset-Liability Management (ALM)

Under the Revised Schedule VI �� K�� &� :U#�&� ��into Current and Non-Current is ��!�`��&�� &� �� J�� &� �� accordance with the ALM guidelines ��`?��L��into consideration while classifying �� revised Schedule VI.

The ALM position of HDFC in accordance with NHB guidelines is ��

As at March 31, 2013, assets and �� :� �� ` 48,501 crores and ` 46,284 crores respectively. �� Q� �� #� �� ` 90,184 crores and ` 93,624 crores respectively and �� #� �� ` 56,846 crores and ` 55,623 crores respectively.

HDFC does not generally take an �� !� `X'Km�� L��|��%��&� �� &� �� KX�� !�*�� &� �� |��%��way of interest rate swaps. However, during FY 2013, due to tight liquidity ��&��<��%�� %<�� of the year. This resulted �� |��%� ��

48

�� %��%�� !� '��&� �� :;<�� %� �� U"��|��%��L�� :<�� L� �� U!$#"� �� |��%� �� !� `��&� `X'K� �� |��%� �� %�� !� � `X'K� �� %�� L�� shall enter into interest rate swaps at �� interest rate gap.

�� \�� [:&� Q;:[&� $�"� �� /:"��|��%��!

'��&�`X'K��'� ��>��`��b�� +�� L�� !

Internal Audit and Control

HDFC has instituted adequate internal �� size of its operations. Internal audit ��chartered accountants and cover all ��L��!�� %�� and follow-up actions thereon are �� K��!�� K�� three independent directors. The �� %� ��!

�� !��"��#��

�� unt for the year ��\��[:&�Q;:[��

�� %�� :�"�� %��:$"!

�� *�� *�� %�� :/"��%��!

�� *�� \��%�� !Q:"!

�� *�� ` 1,725 ��` 1,543 crores in the previous year. �� Q�!Q"�� Q/!Q"� �� previous year.

�� <�� %��[!$"��<tax return on average assets ��Q!$"!

�� >��J��QQ"��current year.

�� `X'Km�� /!$"� �� March 31, 2013 as against /!�"� �� !�`X'Km�� %� �� in Asia.

�� &��percentage of average assets �� ;![;"� �� \��31, 2013.

�� '��\��[:&�2013, a dividend of ` 12.50 per share of `�Q��%�� %�� ` 11 per equity share in the previous year. HDFC would ��%� �� and education cess on the dividend declared.

�� !�"��%��#!$"��the previous year.

Spread on Loans

The average yield on loan assets ��%� �� ::!U$"� ��::!$["�� !� ��average all-inclusive cost of funds

��U!�$"��U!#�"��year. The spread on loans over �� %�� Q![;"� �� %��Q!Q/"� �� year. Spread on individual loans �� :!U�"��Q!U�"!

Capital Adequacy Ratio

In accordance with the NHB guidelines on capital adequacy HDFC �� J�� J�� :Q"� �� L�weighted assets.

As at March 31, 2013, the risk weighted assets stood at ` 1,70,240 ��!�`X'Km��J��:�!�"�� L��%��&� �� %�� J�� :Q"!� � �� *� �� :[!U"� �%�� J��"��**��Q!#"!

Prudential Norms for Housing Finance Companies (HFCs)

NHB has issued guidelines to HFCs �� %��&��%��&��&� �� J�� ~��L�� !�`X'K� �� !

Human Resources

`�� `X'Km�� !� �� `X'Km�� :� �� :UU$� �� Q#;� = ��%��`+�b@��%�� $;��:&$[[��%��!

��

49


March 31, 2013 stood at ` 100 ��` 92 crores in �� \��[:&�Q;:[��`�Q�#��` 240 lacs in the previous year.

Audited Consolidated Accounts

In accordance with the accounting ��*��of Chartered Accountants of India, �� K��%�� <��<�� J��!

]�� \�� [:&� Q;:[� �� ` 7,467.28 crores �� ` 6,216.73 crores in the previous year representing a %��Q;"!

After providing ` 2,002.03 crores (previous year ` 1,726.96 crores) �� &� �� `� #&��#!Q#� �� ` 4,489.77 crores in the previous ��%��%��QQ"!

�� %� �� ` 341.80 crores (previous year ` 207.78 crores) and ��` 1,516.27 crores (previous year `� :&:$;!#Q� ��@&� �� %�� `� �&�[U!/Q� �� ` 5,462.51 crores in the previous ��%��%��QQ"!

#��$��!��

�� for the year ended March 31, 2013 �� QQ"� �� of the Corporation, HDFC Bank and �� &�`X'K�+��b�� *�� K�� b��(HDFC Life) and HDFC ERGO General *�� K�� b�� =`X'K�ERGO).

For the year ended March 31, 2013, `X'K� ?��Lm�� =��@� ��after tax stood at ` 6,869.64 crores as against ` 5,247.02 crores in the previous year, representing an ��[:"!

`X'K� b�� ` 451.48 crores for the year ended March 31, 2013 as against ` 271.02 ��!��L��L� �� %��%� �� incurred in writing of new policies.

`X'K� �� \��%�� ` 318.75 crores for the year ended March 31, 2013 as against ` 269.14 crores in the ��%��:$"!

`X'K��>�]��tax of ` 248.3 crores for the year ended March 31, 2013 as against ` 141.9 crores in the previous �� %� �� *�� \�� Insurance Pool (IMTPIP) and the Indian Motor Third Party Declined Risk Insurance Pool (IMTDRIP). The

�� *\��*�� *\�X>*��were ` 66.4 crores (previous year ` 181.6 crores). Thus the profit �� %� �� ` 181.9 crores (previous year loss of ` 39.7 ��@!�� the year stood at ` 154.5 crores as against a loss of ` 39.7 crores in the previous year.

�>{`�'��b��` 145.88 crores for the year ended March 31, 2013 as against ` 120.34 crores in the previous year ��%��Q:"!

�� !��

��`X'K�� ` 4,122.62 crores in the previous year to ` 4,848.34 crores in the year ended March [:&� Q;:[� �� :$"!�� %� �� &�� K��m�� ` 1,791.38 crores for the year ended March 31, Q;:[� �� ` 1,339.89 crores in the previous year – an ��[�"!

�� the group was ` 6,639.72 crores �� ` 5,462.51 crores in the previous year representing a %��QQ"!

For the year ended March 31, Q;:[&� �� consolidated profit after tax grew ��Q#"��Q/"��!

50

TO THE MEMBERS OF HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED

judgment, including the assessment of the risks of material misstatement ��&��due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Corporation’s preparation ��statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the \��%��&� �� %�the overall presentation of the ��!We believe that the audit evidence �� appropriate to provide a basis for our audit opinion.OpinionIn our opinion and to the best of our information and according to the explanations given to us, the �� %��the information required by the Act in the manner so required and give a ��the accounting principles generally accepted in India: (a) in the case of the Balance Sheet, of the state of affairs of the Corporation as at March 31, 2013; (b) in the case of the Statement ��b��&��Corporation for the year ended on that date; and� =�@� ��K��'��+��&� �� |�� Corporation for the year ended on that date.Report on Other Legal and Regulatory Requirements1. As required by the Companies (Auditor’s Report) Order, 2003 (“the Order”) issued by the Central

Government in terms of Section QQ/=��@� �� &� �� %�� Annexure a statement on the matters �� %�� #� ��the Order.2. As required by Section 227(3) of ��&�� (a) We have obtained al l the information and explanations �� L��%�� purposes of our audit. (b) In our opinion, proper books �� J�� been kept by the Corporation so far as it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from Dubai �� other auditor, not visited by us. (c) The Balance Sheet, the +�� b�� K��'��+��>��%�� L�� returns received from Dubai branch �� auditor, not visited by us. (d) In our opinion, the Balance +��&� �� +�� b�� K�� '�� +��%�+��referred to in Section 211(3C) of the Act.� =@� ]��representations received from the directors as on 31st March, 2013 taken on record by the Board of Directors, none of the directors is ��J��[:��\��&�Q;:[�from being appointed as a director in terms of Section 274(1)(g) of the Act.

For DELOITTE HASKINS & SELLSChartered Accountants

(Firm Registration No. 117366W)

Sanjiv V. PilgaonkarMUMBAI, Partner8th May, 2013 (Membership No. 39826)

Report on the Financial StatementsWe have audited the accompanying financial statements of HOUSING D E V E L O P M E N T F I N A N C E CORPORATION L IMITED ( the ¡K��¢@&� �� Balance Sheet as at March 31, 2013, ��+��b��K��'��+��then ended, and a summary of the ��%�� %� �� other explanatory information.Management’s Responsibility for the Financial StatementsThe Corporation’s Management is responsible for the preparation of �� %�� position, financial performance �� |�� K�� %�Standards referred to in Section 211(3C) of the Companies Act, 1956 (“the Act”) and in accordance �� %� ��generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of �� %�� &��to fraud or error.Auditors’ ResponsibilityOur responsibility is to express an ��based on our audit. We conducted �� Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that ��J��and plan and perform the audit to obtain reasonable assurance about ��free from material misstatement.An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the ��!��he procedures selected depend on the auditor’s

Independent Auditors’ ReportSTANDALONE FINANCIAL STATEMENTS

51

THIRTY SIXTH ANNUAL REPORT 2012-13STANDALONE FINANCIAL STATEMENTS

(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)

(i) Having regard to the nature of the Corporation’s business/activities/ results/transactions during the year, clauses (ii), (viii), (x) and (xiii) of paragraph 4 of the Order are not applicable to the Corporation.

=��@� *��

(a) The Corpora t ion has �� %�full particulars, including quantitative �� !

� =�@� +�� %��by the Management in accordance �� %�� &�� &� �� assets at reasonable intervals. According to the information and explanations given to us, no material ��!

� =�@� �� off during the year, in our opinion, do not constitute a substantial part �� K��and such disposal has, in our opinion, not affected the going concern status of the Corporation.

(iii) In respect of loans, secured or unsecured, granted by the K�� &� �� other parties covered in the Register maintained under Section 301 of the Companies Act 1956, according to the information and explanations given to us:

(a) The Corporation has granted loans to eight parties. At the year-end, the outstanding balances of such loans granted aggregated ` 23.17

crores (number of parties - four) and the maximum amount involved ��%��` 313.30 crores (number of parties - eight).

(b) The rate of interest and other terms and conditions of such loans are, in our opinion, prima facie not prejudicial to the interest of the Corporation.

(c) The receipts of principal amounts and interest have been regular/as per stipulations.

(iv) In respect of loans, secured or unsecured, taken by the Corporation from companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956, according to the information and explanations given to us:

(a) The Corporation has taken loans from sixty six parties. At the year-end, the outstanding balances of such loans taken aggregated ` 2,522.04 crores (number of parties – fifty eight) and the maximum ��%��` 3,667.16 crores (number of parties – sixty six).

(b) The rate of interest and other terms and conditions of such loans are, in our opinion, prima facie not prejudicial to the interest of the Corporation.

(c) The payments of principal amounts and interest in respect of such loans are regular/as per stipulations.

(v) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate ��K��the nature of its business for the purchase of fixed assets and for

Annexure to the Independent Auditors’ Report

52

the sale of services and during the �� L�� such internal control system.

=��@� �� L��%�and belief and according to the information and explanations given �� &� �� or arrangements [excluding items reported under paragraph (iii) and (iv) above] that needed to be entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956.

(vii) In our opinion and according to the information and explanations given to us, the Corporation has complied ��+��#$�&�58AA or any other relevant provisions of the Companies Act, 1956, the Companies (Acceptance of Deposits) Rules, 1975 and the Housing Finance Companies (NHB) Directions, 2010, ��%��from the public. According to the information and explanations given to us, no order has been passed by the K��b��?��K��b��>��Bank of India or any Court or any other Tribunal.

(viii) In our opinion, the internal audit functions carried out during the year ��K��appointed by the Management have ��the Corporation and the nature of its business.

(ix) According to the information and explanations given to us, in respect of statutory dues:

(a) The Corporation has been regular in depositing undisputed statutory dues, including Provident Fund, Investor Education and Protection Fund, Employees’ State

Insurance, Income-tax, Sales Tax, Wealth Tax, Service Tax, Cess and other material statutory dues �� authorities.

� =�@� �� amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees’ State Insurance, Income-tax, Sales Tax, Wealth Tax, Service Tax, Cess and other material statutory dues in arrears as at 31st March, 2013 for a period of more than six months from the date they became payable.

(c) Details of dues of Wealth Tax, Interest on Lease Tax and ��m� +�� *�� have not been deposited as on 31st March, 2013 on account of disputes ��%��

Name of Statute Nature of DuesForum where

Dispute is Pending

Period to which the Amount

Relates

Amount Involved

` in Crores

The Wealth Tax Act, 1957

Wealth TaxAssistant

Commissioner of Wealth Tax

1998-1999 0.12

Maharashtra Sales Tax on the Transfer of the Right to use any Goods for any Purpose Act, 1985

Interest on Lease Tax

Commissioner of Sales Tax

(Appeals)1999-2000 0.02

E m p l o y e e s S t a t e Insurance Act, 1948

��Employer’s

Contribution to ESIC

Assistant / Deputy Director

- ESIC2010-2011 0.01

(x) In our opinion and according to the information and explanations given to us, the Corporation has not defaulted in the repayment of dues �� &� ��L�� debenture holders.

(xi) In our opinion, the Corporation has maintained adequate documents �� %��loans and advances on the basis of ��%��&�debentures and other securities.

��&��deployment pending application.

(xv) According to the information and explanations give to us and on �� &� �� %�� Asset Liability Management Report, liabilities maturing in the next one year are not in excess of the assets of similar maturity.

(xii) Based on our examination of the records and evaluation of the related internal controls, the Corporation has maintained proper records of the transactions and contracts in respect of its dealing in shares, securities, debentures and other investments and timely entries have been made therein. The aforesaid securities have been held by the Corporation in its ��!

(xiii) In our opinion and according to the information and explanations given to us, the Corporation has not given any guarantees for loans taken �� L�� institutions.

(xiv) In our opinion and according to the information and explanations given to us, the term loans have been applied by the Corporation during the

53


(xvi) According to the information and explanations given to us, the Corporation has made preferential allotment of shares on exercise of options granted in earlier years under the ESOP Schemes to parties covered in the Register maintained under Section 301 of the Companies Act, :U#��&��&�is prima facie not prejudicial to the interest of the Corporation.

(xvii) According to the information and explanations given to us, during the period covered by our audit report, the Corporation had issued non-

convertible debentures amounting to ` 33,180 crores. The Corporation has created security in respect of the debentures issued.

(xviii) During the period covered under our audit report, the Corporation has not raised any money by public issues.

= � @�� L��%�and according to the information and explanations given to us, no fraud by the Corporation and no material fraud on the Corporation has been noticed or reported during the year, although there have been

�� %�doubtful of recovery consequent upon fraudulent misrepresentation by ��&�� of the Corporation and the nature of �� provided for.




54

Balance Sheet as at March 31, 2013

Notes` in Crores ` in Crores

March 31, 2012` in Crores

EQUITY AND LIABILITIESSHAREHOLDERS’ FUNDSShare capital 2 309.27 295.39 Reserves and surplus 3 24,690.73 18,722.19

25,000.00 19,017.58 NON-CURRENT LIABILITIESb��%<��%� 4 90,005.01 74,837.74 Other long-term Liabilities 5 1,495.23 1,038.37 Long-term Provisions 6 1,614.56 1,502.44

93,114.80 77,378.55 CURRENT LIABILITIES+��<��%� 7 18,786.69 21,146.24 Trade payables 8 60.80 178.72 Other current liabilities 9<��?��%� 50,036.41 43,143.52 - Others 5,729.46 4,084.80 Short-term Provisions 10 2,802.59 2,570.53

77,415.95 71,123.81 195,530.75 167,519.94

ASSETSNON-CURRENT ASSETSFixed assets(i) Tangible assets 11 232.96 232.48 (ii) Intangible assets 12 4.98 1.47 Non-current investments 13 12,531.86 12,011.56 Deferred tax asset (net) 14 631.38 628.20 Long-term loans and advances: 15- Loans 151,630.87 125,532.65 - Others 1,817.56 1,967.26 Other non-current assets 16 779.75 1,054.56

167,629.36 141,428.18 CURRENT ASSETSCurrent investments 17 1,081.60 195.44 Trade receivables 18 1.32 60.21 Cash and bank balances 19 5,751.14 5,472.85 Short-term loans and advances 20- Loans 17,939.97 14,889.04 - Others 2,459.89 4,998.15 Other current assets 21 667.47 476.07

27,901.39 26,091.76 195,530.75 167,519.94

+��%��%��

As per our report attached. Directors

For Deloitte Haskins & Sells Deepak S. Parekh S. B. Patel R. S. TarnejaChartered Accountants Chairman B. S. Mehta J. J. Irani

D. N. Ghosh Bimal JalanKeki M. Mistry S. A. Dave D. M. Sukthankar

Sanjiv V. Pilgaonkar Vice Chairman &Partner Chief Executive Officer

Renu Sud Karnad V. Srinivasa Rangan Girish V. KoliyoteMUMBAI, May 8, 2013 Managing Director Executive Director Company Secretary

55


�� !��"�� $ � �� '��+:;<=:+

Notes` in Crores

Previous Year` in Crores

INCOME

Revenue from Operations 23 20,796.95 17,062.58

��*�� 24 315.55 270.19

Other Income 25 35.12 21.51

Total Revenue 21,147.62 17,354.28

EXPENSES

Finance Cost 26 13,890.89 11,156.78

Staff Expenses 27 246.19 205.79

Establishment Expenses 28 75.68 52.57

Other Expenses 29 193.43 172.98

Depreciation and Amortisation 11 & 12 23.59 20.54

Provision for Contingencies 3.2 & 30 145.00 80.00

Total Expenses 14,574.78 11,688.66

PROFIT BEFORE TAX 6,572.84 5,665.62

Tax Expense- Current Tax 1,727.68 1,555.00 - Deferred Tax 14 (3.18) (12.00)

PROFIT FOR THE YEAR 3 4,848.34 4,122.62

EARNINGS PER SHARE (Face Value ` 2) 31- Basic 31.84 27.97- Diluted 31.45 27.54

+��%��%��






56

Cash Flow Statement for the year ended March 31, 2013

Notes` in Crores

Previous Year ` in Crores

A CASH FLOW FROM OPERATING ACTIVITIES�� 6,572.84 5,665.62 Adjustments for:Depreciation and Amortisation 11 & 12 23.59 20.54 Provision for Contingencies 3.2 145.00 80.00 Interest Expense 26 13,633.99 10,873.09 Net Gain on translation of foreign currency monetary assets and liabilities 26.3 (53.23) (25.36)Interest Income 23 (19,817.18) (16,048.95)Utilisation of Securities Premium (708.71) (619.71)Shelter Assistance Reserve - utilisation 3 (9.13) (6.89)��+��*�� 24 (315.55) (270.19)Dividend Income 23 (480.66) (309.66)��+��*�� (0.12) (1.27)Surplus from deployment in Cash Management Schemes of Mutual Funds 23 (252.34) (319.78)��+��'� ��=��@ (0.23) (0.69)]��%��O��L��%�K��%� (1,261.73) (963.25)Adjustments for:Current and Non Current Assets 4,102.38 (2,015.78)Current and Non Current Liabilities (253.26) 160.64Cash generated from Operations 2,587.39 (3,305.17)Interest Received 19,706.87 15,826.69Interest Paid (11,771.41) (9,617.67)Dividend Received 480.66 309.66 Taxes Paid (2,197.46) (2,002.11)Net cash from Operations 8,806.05 1,211.40 Loans disbursed (net) (28,956.66) (23,566.58)Corporate Deposits (net) 345.57 (1,399.99)Net cash used in operating activities [A] (19,805.04) (23,755.17)

B CASH FLOW FROM INVESTING ACTIVITIESPurchase of Fixed Assets (25.84) (18.91)Sale of Fixed Assets 0.91 1.48

(24.93) (17.43)Investments in Subsidiaries (86.58) (287.00)Investment in Cash Management Schemes of Mutual Funds (226,559.00) (190,668.50)Other Investments (3,263.17) (901.54)Sale proceeds of Investments : - in Cash Management Schemes of Mutual Funds 226,811.34 190,988.28 - in other Companies and Properties 2,249.44 1,057.79 Net cash (used in) / from investing activities [B] (872.90) 171.60

C CASH FLOW FROM FINANCING ACTIVITIESShare Capital - Equity 2.1 13.88 2.02 Securities Premium 3 3,819.09 305.07 ?��%��=��@ 19,542.02 23,919.98 Dividend paid - Equity Shares (1,635.57) (1,321.85)Tax paid on Dividend (241.02) (209.95)� �� >�? 21,498.40 22,695.27 Net Increase / (Decrease) in cash and cash equivalents [A+B+C] 820.46 (888.30)Add : Cash and cash equivalents as at the beginning of the year 19 2,499.40 3,379.60 Add : Exchange difference on bank balance 4.19 8.10 Cash and cash equivalents as at the end of the year 19 3,324.05 2,499.40 ��L��L�� - Unclaimed dividend account 11.61 9.68 - Other against Foreign Currency Loans 5.41 4.76 Short-term bank deposits 2,410.07 2,959.01 Cash and Bank balances at the end of the year 19 5,751.14 5,472.85

+��%��%��






57


��

1. SIGNIFICANT ACCOUNTING POLICY

1.1 ACCOUNTING CONVENTION

� �� &� �� %�+�� K�� =��%� +��@� >��&� Q;;�� Companies Act, 1956 and the guidelines issued by the National Housing Bank. The accounting policies adopted ��!

� �� J�� \��%�� L� �� considered in the reported amounts of assets and liabilities (including contingent liabilities) as of the date of �� %� �� %� ��!� \��%��!�'��%��L��~��!

1.2 SYSTEM OF ACCOUNTING

The Corporation adopts the accrual concept in the preparation of the accounts.

� ��?��+��+��b��K��+��Q::��K��:U#�&��>��+��*!

1.3 INFLATION

� ��K��!��|��%��%��%��!

1.4 OPERATING CYCLE

Based on the nature of its activities, the Corporation has determined its operating cycle as 12 months for the ��<��!

1.5 CASH FLOW STATEMENT

� K��|�� %� �� &��~=��@�� is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future ��!��|��%&��%��%��K��are segregated based on the available information.

1.6 CASH AND CASH EQUIVALENTS (FOR PURPOSES OF CASH FLOW STATEMENT)

� K��L�!�K��J��<��=��%��J��@&��%��J��L��%��L��%��value.

1.7 INTEREST ON HOUSING LOANS

� >��%��%��J��\��*��=�\*�@��%��and interest. EMIs commence once the entire loan is disbursed. Pending commencement of EMIs, pre-EMI interest is payable every month. Interest on loans is computed either on an annual rest or on a monthly rest basis.

1.8 INCOME FROM LEASES

� b��%��%�+��b��m�=�+�:U@��K��=��%�+��@�>��&�Q;;�!

58

1.9 INCOME FROM INVESTMENTS

The gain/loss on account of Investments in Preference Shares, Debentures/Bonds and Government Securities held as long-term investments and acquired at a discount/premium, is recognised over the life of the security ��<��!� *�� *��!�X��right to receive is established.

1.10 BROKERAGE AND SERVICE CHARGES ON DEPOSITS

Brokerage, other than incentive brokerage, and service charges on deposits are amortised over the period of ��!�*��L��%&��%��%��&��%��+��b��!

1.11 TRANSLATION OF FOREIGN CURRENCY

Initial recognition

Transactions in foreign currencies entered into by the Corporation are accounted at the exchange rates prevailing on the date of the transaction.

Measurement at the Balance Sheet date

Assets and liabilities in foreign currencies are converted at the rates of exchange prevailing at the year-end, ��!�O��K��&��&�� %��&��exchange rate on the date of the transaction is recognised as income or expense over the life of the contract.

� K��L��%��%��!

The net loss/gain on translation of long term monetary assets and liabilities in foreign currencies is amortised �� %�� +��Loss. The unamortised exchange difference is carried in the Balance Sheet as “Foreign currency monetary item translation difference account”. The net loss/gain on translation of short term monetary assets and liabilities ��%��+��b��!

1.12 INVESTMENTS

� *�� L��%� �� %�� %��&� ��!� K�� b��%� ��!� b��%<�� = ��%� �� @&� �� individually at cost less provision for diminution, other than temporary, in the value of such investments. K��&��!��%��`��%�?��L��%�+��%��*��m�=�+�:[@��K��=��%�+��@�Rules, 2006, and is recognised through the Provision for Contingencies Account. Investment properties are carried individually at cost less accumulated depreciation and impairment, if any.

1.13 TANGIBLE FIXED ASSETS

Fixed Assets are capitalised at cost inclusive of legal and/or installation expenses. Leased Assets are accounted �� %� +�� b��m� =�+� :U@� �� K�� =��%�Standards) Rules, 2006.

1.14 INTANGIBLE ASSETS

� *��%��%��J��&��%��%��%��L��%��&��!�� %��+��b��!

�� (Continued)

59


1.15 DEPRECIATION AND AMORTISATION

Tangible Fixed Assets

Depreciation on all Fixed Assets other than Leased Assets and Leasehold Improvements, is provided for the full year in respect of assets acquired during the year. No depreciation is provided in the year of sale.

In respect of Leased Assets and Leasehold Improvements depreciation is provided on a pro-rata basis from the date of installation/acquisition.

Depreciation on Buildings, Computers, Leased Assets and Leasehold Improvements, is calculated as per the straight-line method; and on other assets as per the reducing balance method. All assets except Computers ��b��K��&�:U#�!�X��K��Q#��!�X��%��&��+��Q;#=#@=�@��K��&�:U#�&��!�X��b��*��is provided on the straight-line method over the primary period of the lease.

Intangible Assets

� K��%��<��!

Investment in Properties

Depreciation on Investment in properties is provided on a pro-rata basis from the date of acquisition.

1.16 PROVISIONS AND CONTINGENCIES

� �� %��K��%�� |�� J�� %�� !��= ��%��@��are determined based on the best estimate required to settle the obligation at the balance sheet date. These ��|��!�K��%��!�K��%��%��!

1.17 PROVISION FOR CONTINGENCIES AND NON-PERFORMING ASSETS

The Corporation’s policy is to carry adequate amounts in the Provision for Non-Performing Assets account and the Provision for Contingencies account to cover the amount outstanding in respect of all non-performing assets ��%��!�� <��%��`��%�?��L!��<��%��deducted from loans and advances. The provisioning policy of the Corporation covers the minimum provisioning required as per the NHB guidelines.

1.18 EMPLOYEE BENEFITS

Z ��

� ��K��m��plans and are charged as an expense based on the amount of contribution required to be made. These funds and the schemes thereunder are recognised by the Income-tax authorities and administered by various trustees.The Rules of the Corporation’s Provident Fund administered by a Trust require that if the Board of Trustees are unable to pay interest at the rate declared for Employees’ Provident Fund by the Government under para 60 of the Employees’ Provident Fund Scheme, 1952 for the reason that the return on investment is less or ��&��%��K��!

�� (Continued)

60

Z �� B � ��Plans

� '�� %�� X��&��%��%��{��K��&��valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised in the +��b�� !�� %�� %��<��%��!��%��%��?��+��%��%��cost, as reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the schemes.

� � ��X��K��&��%��!

Short-term Employee B � ��

� ��<�� %��%��%��!�� !

The cost of short-term compensated absences is accounted as under:

� =�@� �� &� �� their entitlement of future compensated absences; and

� =�@� ��<��%��&��!

Long-term Employee B � ��

� K�� %��%��!

1.19 EARNINGS PER SHARE

� ?��%�� %� ��~=��@�� =��%� �� &� �� @� �� %�� %� �� J�� %� ��%� �� !�X��%��%��~=��@�� =��%�� extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income (net �� @��%��J��&��%��%��J�� %��%�� %��%��J��J��!

� �� J�� J�� %��!��J��be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented. The number of equity shares and potentially dilutive equity shares are adjusted for share splits/reverse share splits and bonus shares, as appropriate.

�� (Continued)

61


1.20 INCOME-TAX

K�� the provisions of the Income Tax Act, 1961.

� X�� %�� %� ��&� ��%� �� the accounting income that originate in one period and are capable of reversal in one or more subsequent ��!�X�� %�� the reporting date. Deferred tax assets are recognised for timing differences of items other than unabsorbed �� %�� !� `��&� �� &�� %�� !

Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing �� K�� %��%��!�X�� at each balance sheet date for their realisability.

Current and deferred tax relating to items directly recognised in reserves are recognised in reserves and not ��+��b��!

1.21 SERVICE TAX INPUT CREDIT

� +�� L��%��%~��%��!

1.22 SECURITISED ASSETS

Derecognition of securitised assets in the books of the Corporation, recognition of gain or loss arising on securitisation and accounting for credit enhancement provided by the Corporation is based on the Guidance Note on Accounting for Securitisation issued by the Institute of Chartered Accountants of India.

Securitised assets are derecognised in the books of the Corporation based on the principle of surrender of ��!�K��K��K��?��%��K��*��%��K��!�:[!

2. SHARE CAPITAL

As at March 31, 2013

` in Crores


` in Crores

AUTHORISED

162,50,00,000 Equity Shares of ` 2 each 325.00 325.00

(Previous Year 162,50,00,000 Equity Shares of ` 2 each)

325.00 325.00

ISSUED, SUBSCRIBED AND FULLY PAIP UP

154,63,47,255 Equity Shares of ` 2 each 309.27 295.39

(Previous Year 147,69,70,010 Equity Shares of ` 2 each)

309.27 295.39

�� (Continued)

62

2.1 Reconciliation of number of shares outstanding at the beginning and at the end of the reporting period:

Particulars As at March 31, 2013 As at March 31, 2012

Number ` in Crores Number ` in Crores

Equity shares outstanding as at the beginning of the year 147,69,70,010 295.39 146,68,86,690 293.37

Shares allotted pursuant to exercise of stock options 1,46,93,995 2.94 1,00,23,420 2.00

Shares allotted pursuant to exchange of �� 5,46,83,250 10.94 59,900 0.02

Equity shares outstanding as at the end of the year 154,63,47,255 309.27 147,69,70,010 295.39

2.2 The details of each shareholder holding more than 5 percent shares in the Corporation:

Particulars Outstanding as on 31.3.2013 Outstanding as on 31.3.2012

Number % of shares held to total Shares

Number (%) of shares held to total Shares

Aberdeen Asset Management Asia Ltd. (on behalf of funds advised/managed)

12,74,90,319 8.24 11,35,93,819 7.69

Life Insurance Corporation of India - - 8,25,68,977 5.59

2.3 4,77,13,935 shares of ` 2 each (Previous Year 11,71,16,560 shares of `�Q��@��

a) 4,77,13,935 shares of ` 2 each (Previous Year 6,24,07,930 shares of `�Q��@��%�Employees Stock Options granted/available for grant, including lapsed options [Refer Note 2.4].

b) Nil shares of ` 2 each (Previous Year 5,47,08,630 shares of `� Q� ��@� �� %� ��¥>��[!$¦!

The Corporation has only one class of shares referred to as equity shares having Face Value of ` 2 each. Each holder of equity share is entitled to one vote per share.

The holders of equity shares are entitled to dividends, if any, proposed by the Board of Directors and approved by Shareholders at the Annual General Meeting.

2.4 During the year, Nomination and Compensation Committee of Directors (NCCD) at its meeting held on May 23, Q;:Q�%��#$&�/&#��L��%��Q&[�&UQU��+��i.e. ESOS-05 : 32,030 options, ESOS-07 : 1,32,087 options, ESOS-08 : 70,812 options in all aggregating to 61,02,475 stock options representing 3,05,12,375 equity shares of ` 2 each at an exercise price of ` 3,117.50 per option to Employees and Directors of the Corporation under Employees Stock Option Scheme - 2011 =�+]+<::@!��%��!!��%��J��K��L� ��%��%��%��%��&��%��KKX��are granted.

�� (Continued)

63


*��+]+�<�::&��:<[��%��&��\��QQ&�Q;:#&��%��%��%�� Corporation. Accordingly, no options have vested during the current year. The options can be exercised over a ��%!

Under Employees Stock Option Scheme – 2008 (ESOS – 08), the Corporation had on November 25, 2008, granted 57,90,000 stock options at an exercise price of `1,350.60 per option representing 57,90,000 equity shares of `:;� �� K��!� �� %��!!��%��the stock exchange having higher trading volume, prior to grant of options.

� *��+]+�<�;$&��:<[��%��&��Q�&�Q;::&��%��%��%��the Corporation. Accordingly, during the year Nil options�=��&;�Q��@��112 options =��#$:��@��%!�� %!

Under Employees Stock Option Scheme – 2007 (ESOS – 07), the Corporation had on September 12, 2007, granted 54,56,835 stock options at an exercise price of `2,149 per option representing 54,56,835 equity shares of `�:;�� K��!�� %��!!��%��the stock exchange having higher trading volume, prior to grant of options.

� *��+]+�<�;/&��:<[��%��&��+��::&�Q;:;&��%��%��%��the Corporation. All the options have been vested in the earlier years. In the current year 525 options (Previous ��:&�[;��@��%!�� the date of respective vesting.

Under Employees Stock Option Scheme – 2005 (ESOS – 05), the Corporation had on October 25, 2005, granted 74,73,621 stock options at an exercise price of ` 912.90 per option representing 74,73,621 equity shares of `�:;� �� K��!�� %��!!��%��the stock exchange having higher trading volume, prior to grant of options.

� *��+]+<;#&��Q<[��%��&��]��Q�&�Q;;$&��%��%��%��Corporation. All the options have been vested in the earlier years. In the current year 12,285 options (Previous ��#Q��@��%!�� the date of respective vesting. Accordingly, all the options vested under ESOS-05 have been exercised.

Method used for accounting for share based payment plan:

The Corporation has used intrinsic value method to account for the compensation cost of stock options to ��K��!�*��J��L��%�share exceeds the exercise price of the option. Since the options under ESOS-11, ESOS-08, ESOS-07 and �+]+<;#��%��L��&��!�K��J��%�value of the option (compensation cost) is also Nil.

�� (Continued)

64

Movement in the options under ESOS-11, ESOS-08, ESOS-07 and ESOS-05:

Particulars ESOS-11

Options Current Year

Options Previous Year

Outstanding at the beginning of the year - -

Granted during the year 61,02,475 -

Vested during the year - -

Exercised during the year - -

Lapsed during the year 31,200 -

Outstanding at the end of the year 60,71,275 -

Unvested at the end of the year 60,71,275 -

Exercisable at the end of year - -

Weighted average price per option ` 3177.50

Particulars ESOS-08



Outstanding at the beginning of the year 22,81,083 32,29,708

Granted during the year - -

Vested during the year - 64,042

Exercised during the year 5,24,232 9,48,044

Lapsed during the year 112 581

Outstanding at the end of the year 17,56,739 22,81,083

Unvested at the end of the year - -

Exercisable at the end of year 17,56,739 22,81,083

Weighted average price per option ` 1,350.60

Particulars ESOS-07



Outstanding at the beginning of the year 37,80,574 44,21,246

Granted during the year - -

Vested during the year - -

Exercised during the year 21,09,398 6,39,042

Lapsed during the year 525 1,630

Outstanding at the end of the year 16,70,651 37,80,574

Unvested at the end of the year - -

Exercisable at the end of year 16,70,651 37,80,574

Weighted average price per option ` 2,149.00

�� (Continued)

65


Particulars ESOS-05



Outstanding at the beginning of the year 3,17,454 7,35,576Granted during the year - - Vested during the year - - Exercised during the year 3,05,169 4,17,598Lapsed during the year 12,285 524Outstanding at the end of the year - 3,17,454Unvested at the end of the year - - Exercisable at the end of year - 3,17,454Weighted average price per option ` 912.90

� O��%��Q:&�Q;:;&��J��K��<��from ` 10 per share to ` 2 per share. Accordingly, each options exercised after August 21, 2010 is entitled to 5 equity shares of ` 2 each.

Fair Value Methodology:

The fair value of options have been estimated on the date of grant using Black-Scholes model as under:

The key assumptions used in Black-Scholes model for calculating fair value under ESOS-2011, ESOS-2008, �+]+<Q;;/��+]+<Q;;#��%��!�\��Q[&�Q;:Q&��Q#&�Q;;$&�+��:Q&�Q;;/��]��Q#&�Q;;#&��

Particulars ESOS-2011 ESOS-2008 ESOS-2007 ESOS-2005

Risk-free interest rate (p.a.) 8.06% 6.94% 7.70% 6.38%Expected life Upto 2 years Upto 2 years Upto 2 years 2 to 3 yearsExpected volatility of share price 15% 29% 19% 30%� ��%��=�!�!@ 20% 20% 20% 20%��%��%��&��of grant (per Stock Option)

` 474.56 ` 238.79 ` 307.28 ` 105.50

Since all the stock options granted under ESOS-2008, ESOS-2007 and ESOS-2005 have been vested, the stock based compensation expense determined under fair value based method is ` Nil (Previous Year ` Nil). ��%��%��?��X��+!

� `��&�� L��%��+]+<::��&��K��m��%��<��

` in Crores

Particulars Current Year Previous Year

��=��@ 4,848.34 4,122.62 Less : Stock-based compensation expenses determined under fair value based method, net of tax: [Gross ` 233.78 crores (Previous Year ` Nil)] (pro forma)

157.93 -

��=��@ 4,690.41 4,122.62 Less : Amounts utilised out of Shelter Assistance Reserve 9.13 6.89 ��%��+�=��@ 4,681.28 4,115.73

�� (Continued)

66

Amount in `


Basic earning per share (as reported) 31.84 27.97 Basic earning per share (pro forma) 30.80 27.97 Diluted earning per share (as reported) 31.45 27.54 Diluted earning per share (pro forma) 30.42 27.54

3. RESERVES AND SURPLUS

As at As at March 31, 2013 March 31, 2012

` in Crores ` in Crores ` in Crores

SPECIAL RESERVE No. I [Refer Note 3.3] 51.23 51.23 SPECIAL RESERVE No. II [Refer Note 3.3]Opening Balance 4,750.95 4,020.95 ��+��b��¥>��[!�¦ 775.00 730.00 Sub Total 5,525.95 4,750.95

GENERAL RESERVEOpening Balance 6,103.16 5,232.29 ��+��b�� 956.62 870.87 Sub Total 7,059.78 6,103.16

ADDITIONAL RESERVE (u/s 29C of the NHB Act)Opening Balance 1,453.93 1,183.86 ��+��b��¥>��[!�¦ 825.00 620.00 Sub Total 2,278.93 1,803.86

Less : Utilised during the Year [Refer Note 3.2][Net of Deferred Tax of ` Nil (Previous Year ` 168.07 crores)] - 349.93 Sub Total 2,278.93 1,453.93

SECURITIES PREMIUMOpening Balance 6,038.89 6,218.89 Add : Transferred from Capital Reserve [Refer Note 3.8] 301.23 - Add : Received during the year 3,819.09 305.07

10,159.21 6,523.96 Less : Utilised during the year (Net) [Refer Note 3.5][(Net of tax effect of ` 175.54 crores) (Previous Year ` 223.25 crores)]

438.04 485.07

Sub Total 9,721.17 6,038.89

SHELTER ASSISTANCE RESERVEOpening Balance 22.76 14.65 ��+��b�� 40.00 15.00

62.76 29.65 Less : Utilised during the year [Refer Note 3.1] 9.13 6.89 Sub Total 53.63 22.76

�� (Continued)

67


As at As at March 31, 2013 March 31, 2012

` in Crores ` in Crores ` in Crores

CAPITAL RESERVEOpening Balance 301.27 301.27 Less: Transferred to Securities Premium [Refer Note 3.8] (301.23) - Sub Total 0.04 301.27

SURPLUS IN THE STATEMENT OF PROFIT AND LOSS:Opening Balance - - �� 4,848.34 4,122.62 Amount available for appropriations 4,848.34 4,122.62 Appropriations - Special Reserve No. II [Refer Note 3.4] 775.00 730.00 - General Reserve 956.62 870.87 - Additional Reserve (u/s 29C of the NHB Act) [Refer Note 3.4] 825.00 620.00 - Shelter Assistance Reserve 40.00 15.00 - Proposed Dividend [(Dividend ` 12.50 per equity share of

` 2 each) (Previous Year ` 11 per equity share of ` 2 each)] 1,932.93 1,624.67

- Additional Tax on Proposed Dividend 328.50 263.56 - Additional Tax on Dividend - 2011-12 [Refer Note 3.6] (24.62) (4.66)- Dividend including tax of ` 2.08 crores (Previous Year

` 0.44 crore) pertaining to previous year paid during the year [Refer Note 3.7] 14.91 3.18

Sub Total - -Total 24,690.73 18,722.19

3.1 Miscellaneous Expenses under Note 29.1 exclude ` 9.13 crores (Previous Year ` 6.89 crores) in respect of amounts utilised out of Shelter Assistance Reserve during the year.

3.2 During the year, in addition to the charges of ` 145 crores (Previous Year ` 80 crores) to the Statement of ��b��&��` Nil (net of Deferred Tax ` Nil) [Previous Year ` 349.93 crores (net of Deferred Tax of ` 168.07 crores)], being one time charge on account of changes in the provisioning requirements by the National Housing Bank vide circulars no. NHB.HFC.DIR.3/CMD/2011 dated August 5, 2011 and NHB.HFC.X*>!�~K\X~Q;:Q�� :U&�Q;:Q�� >��+��29C of the National Housing Bank Act, 1987 pursuant to circular NHB(ND)/DRS/Pol-No.03/2004-05 dated August 26, 2004 as under:

Particulars As at March 31, 2013

` in Crores


` in Crores

To Provision for Contingencies Account [Refer Note 6.2] 54.24 439.36

To Provision for Non-Performing Loans [Refer Note 15.7] 39.05 158.64

To Provision for Doubtful Receivables [Refer Note 20] 51.71 -

145.00 598.00

�� (Continued)

68

3.3 Special Reserve has been created over the years in terms of Section 36(1)(viii) of the Income-tax Act, 1961 �� K��!�+��>��!� *� �� '��:UU�<U/&��+��>��!�**��!

3.4 As per Section 29 C of the National Housing Bank Act, 1987, the Corporation is required to transfer at least Q;"�� !�'�� +��Reserve created by the Corporation under Section 36(1)(viii) of the Income- tax Act, 1961 is considered to be an eligible transfer. The Corporation has transferred an amount of ` 775 crores (Previous Year ` 730 crores) to Special Reserve II in terms of Section 36(1)(viii) of the Income-tax Act, 1961 and an amount of ` 825 crores (Previous Year ` 620 crores) to “Additional Reserve (u/s 29C of the NHB Act)”.

3.5 During the year, Corporation utilised ` 438.04 crores (net of tax effect of `175.54 crores) [(Previous Year ` 485.07 crores (net of tax effect of `� QQ[!Q#� ��@¦� �� +�� /$� �� K�� &�:U#�&��V��K��+��>��K��X��=VKX@!�

3.6 Additional Tax on dividend 2011-12 credit taken, ` 24.62 crores (Previous Year ` 4.66 crores), pertains to the dividend tax paid by the subsidiary companies of the Corporation on the dividend paid to the Corporation as per Section 115(O)(1A) of the Income Tax Act, 1961.

[!/� *��J��+��L�]��+�� %��&��Corporation paid dividend of ` 12.83 crores for the year 2011-12 (` 2.74 crores for the year 2010-11) and tax on dividend of ` 2.08 crores (Previous Year ` 0.44 crores) as approved by the shareholders at the Annual General Meeting held on July 11, 2012.

[!$� X��%��Q;;U<:;&��K��V��K��+��>��<K��X��=VKX@��%%�%��%��`��&;;;��:&;U&#[&/;��of `��Q/#��%%�%��%��`��[;:!Q[��!��J��equity share of the Corporation at an exercise price of ` 3,000 per share of face value of `�:;�� =��exercise price of ` 600 per share of face value of ` 2 each) on or before August 23, 2012. The said issue ��VKX��O��K��§***<��+�� %�?��*��=X��*��@��&�Q;;;!��+��*��transferred from Capital Reserve to Securities Premium Account as the same is not refundable/adjustable in future.

4. LONG-TERM BORROWINGS

` in Crores


` in Crores


` in Crores

Bonds and Debentures [Refer Notes 4.3 & 4.11] 59,503.10 43,691.40

Term Loans :

- Banks [Refer Note 4.11] 5,454.30 10,183.17

- Others [Refer Note 4.11] 1,393.58 1,411.96

Sub Total 66,350.98 55,286.53

Deposits [Refer Note 4.3] 23,654.03 19,551.21

Total 90,005.01 74,837.74

�� (Continued)

69


�!:� b��%<��%��<��

Sr. No. Particulars As at March 31, 2013

` in Crores


` in Crores

Long term borrowings - Secured : [Refer Note 4.2]a) Bonds and Debentures

- Bonds 57.50 62.50- Non Convertible Debentures 55,970.60 40,153.90Sub-Total 56,028.10 40,216.40

b) Term Loans from Banks

- Scheduled Banks 4,855.00 8,850.17Sub-Total 4,855.00 8,850.17

c) Term Loans from other parties

- Asian Development Bank [Refer Note 4.4] 276.75 296.61- Kreditanstalt für Wiederaufbau 10.65 20.70- National Housing Bank 1,072.04 1,055.51

1,359.44 1,372.82Total Secured 62,242.54 50,439.39

Long term borrowings - Unsecured:

a) Bonds and Debentures

- Non Convertible Subordinated Debentures [Refer Note 4.10]

3,475.00 3,475.00


- Scheduled Banks 599.30 1,333.00c) Term Loans from other parties

- Under a line from Kreditanstalt für Wiederaufbau 34.14 39.14Deposits [Refer Note 4.8] 23,654.03 19,551.21

Total Unsecured: 27,762.47 24,398.35Total 90,005.01 74,837.74

�!Q� ��b��%��%��%��K��%�%�of property.

4.3 Non-Convertible Debentures includes ` 625.00 crores (Previous Year ` 580.00 crores) and Deposits includes ` 3.01 crores (Previous Year ` 1.34 crores) from related parties [Refer Note 35].

4.4 The Corporation has availed a loan of USD 100 million from the Asian Development Bank (Loan II). In respect of ��:��Q��%%�%��%��{+X��;��&��%��L&��K��has handed over the dollar funds to the bank overseas and has obtained rupee funds in India amounting to `�Q;;��`�:;;��%��by the bank.

� *��[��{+X��;��&��%�� &��K��L<��<��L��%��*��!��%��!�*��of the agreements, the Corporation’s foreign exchange liability is protected.

�� (Continued)

70

�!#� ��K��{+X�:/#��'��%��K��?��%��>��Bank of India (RBI) under the “approval route” in terms of the RBI Press Release No. 2008-2009/700 dated �� :/&� Q;;$&� �� !� *�� >?*� %��&� �� %�� !�� fully repaid in the current year [Refer Note 9.1].

�!�� \��[:&�Q;:[&� ��K�� %��%��USD 632.96 million equivalent =��{+X�$/#!/$��@!��K��L��&��&��USD 286.75 million equivalent (Previous Year {+X��;�!/��@��%��%��L!�'��&��USD 130 million equivalent� =��{+X�:Q[��@��%&��L��%��L��%��%�!��\��[:&�Q;:[&��K��m��%�� %��L��%��%��USD Nil (Previous Year USD Nil).

As a part of asset liability management on account of the Corporation’s Adjustable Rate Home Loan product as ��%�&��K�� ` 21,185 crores (Previous Year ` 25,210 ��@��\��[:&�Q;:[��%��|��%��L��L�!�*��&��K��USD 476.45 million J��=��{+X�#$$!;/��@��%��liabilities and the interest rate is linked to the benchmarks of respective currencies.

4.7 Monetary assets and liabilities denominated in foreign currencies net of risk management arrangement are �� %��%��!�K��K��*��>��+��by marking the foreign currency component to spot rates.

� '�� '�� &� �� %� ��&� �� such contracts are being amortised over the life of contracts. The amount of exchange difference in respect of ��%�� +��b��J��%�periods is ` 29.90 crores (Previous Year ` Nil).

�!$� �� %��Q=:@=�@�� `��%�'��K�� =�`?@�X��&�Q;:;&��|��%��%��+��b�J��<��=:@��=Q@��Section 29B of the National Housing Bank Act, 1987.

�!U� ��X��QU&�Q;::��\��K��%��Accounting Standard 11, the Corporation has exercised the option as per Para 46A inserted in the Standard for all long term monetary assets and liabilities. Consequently, an amount of ` 169.79 crores�=��%�� ` 57.71 crores) [Previous Year `�Q;�!Q��=��%�� of `��!U;��@¦��%��'��%��K��\��*��Translation Difference Account as on March 31, 2013. This amount is to be amortised over the period of the monetary assets/liabilities.

4.10 During the year, the Corporation raised ` Nil (Previous Year ` 1000 crores) through issue of Long Term Unsecured Redeemable Non-Convertible Debentures (subordinated debt). As at March 31, 2013, the Corporation’s outstanding subordinated debt is ` 3,475 crores (Previous Year ` 3,475 crores). These debentures are �� K�� J�� **� ��under National Housing Bank (NHB) guidelines for assessing capital adequacy. Based on the balance term to maturity as at March 31, 2013, 85.90% (Previous Year 91.51%) of the book value of the subordinated debt is considered as Tier II capital for the purpose of capital adequacy computation.

�� (Continued)

71


4.11 Terms of redemption of bonds and debentures and for repayment terms of term loans:

A) Bonds and Debentures��%��=��L��@

` in Crores

Bonds & Debentures - Secured

Maturities - 1-3 years 3-5 years > 5 years TOTAL

Rates of Interest

6.03% - 8% 2,830.60 800.00 - 3,630.60

(2,383.30) (1,380.60) (500.00) (4,263.90)

8.01% - 10% 20,000.00 13,555.00 9,335.00 42,890.00

(7,345.00) (7,260.00) (10,245.00) (24,850.00)

10.01% - 11.95% - 2,205.00 4,200.00 6,405.00

- (1,085.00) (5,320.00) (6,405.00)

V��K�� 450.00 2,490.00 - 2,940.00

(1,900.00) (2,630.00) - (4,530.00)

Variable Rate

- Linked to G Sec 116.00 12.30 34.20 162.50

(10.25) (116.75) (40.50) (167.50)

TOTAL - SECURED A 23,396.60 19,062.30 13,569.20 56,028.10

A (11,638.55) (12,472.35) (16,105.50) (40,216.40)

Bonds & Debentures - Unsecured

Maturities 1-3 years 3-5 years > 5 years TOTAL

Rates of Interest

7.62% - 9.5% 500.00 475.00 2,500.00 3,475.00

- (975.00) (2,500.00) (3,475.00)

TOTAL - UNSECURED B 500.00 475.00 2,500.00 3,475.00

B - (975.00) (2,500.00) (3,475.00)

TOTAL - (SECURED & UNSECURED) A+B 23,896.60 19,537.30 16,069.20 59,503.10

A+B (11,638.55) (13,447.35) (18,605.50) (43,691.40)

�� (Continued)

72

B) Term Loans from Banks

��%��=��L��@` in Crores

Term Loans from Banks - Secured


Rates of Interest

Term Loans from Scheduled Banks - Rupee

7.01% - 9% 323.00 - - 323.00

(557.00) (323.00) - (880.00)

9.01% - 10.75% 1,032.00 2,400.00 1,100.00 4,532.00

(2,755.00) (1,000.00) (4,000.00) (7,755.00)

Term Loans from Scheduled Banks- Foreign Currency

USD LIBOR + 450 bps to 600 bps - - - -

(215.17) - - (215.17)

TOTAL - SECURED A 1,355.00 2,400.00 1,100.00 4,855.00

A (3,527.17) (1,323.00) (4,000.00) (8,850.17)

Term Loans from Banks - Unsecured


Rates of Interest

Term Loans from Scheduled Banks - Rupee

10.50% - - - -

(650.00) - - (650.00)

Term Loans from Scheduled Banks- Foreign Currency

USD LIBOR + 325 bps - 599.30 - 599.30

(111.00) (572.00) - (683.00)

TOTAL UNSECURED B - 599.30 - 599.30

B (761.00) (572.00) - (1,333.00)

TOTAL (SECURED & UNSECURED) A+B 1,355.00 2,999.30 1,100.00 5,454.30

A+B (4,288.17) (1,895.00) (4,000.00) (10,183.17)

�� (Continued)

73


C) Term loans from other Parties

��%��=��L��@` in Crores

Term Loans from Other parties - Secured


Rates of Interest

Asian Development Bank

USD LIBOR + 40 bps 11.86 13.42 36.94 62.22

(10.47) (11.83) (41.15) (63.45)

Variable linked to Bank PLR 21.93 24.80 68.30 115.03

(20.62) (23.32) (81.08) (125.02)

Variable linked to G Sec 18.97 21.45 59.08 99.50

(17.84) (20.17) (70.13) (108.14)

Kreditanstalt für Wiederaufbau

1.70% 10.65 - - 10.65

(20.70) - - (20.70)

National Housing Bank

6% - 8% 202.14 174.20 61.22 437.56

(169.15) (125.01) (50.69) (344.85)

8.01% - 10% 348.21 112.24 80.14 540.59

(226.29) (78.80) - (305.09)

10.01% - 10.20% 93.89 - - 93.89

(405.57) - - (405.57)

TOTAL SECURED A 707.65 346.11 305.68 1,359.44

A (870.64) (259.13) (243.05) (1,372.82)

Term Loans from Other parties - Unsecured


Rates of Interest


6% 31.14 3.00 - 34.14

(21.70) (17.44) - (39.14)

TOTAL UNSECURED B 31.14 3.00 - 34.14

B (21.70) (17.44) - (39.14)

TOTAL (SECURED & UNSECURED) A+B 738.79 349.11 305.68 1,393.58

A+B (892.34) (276.57) (243.05) (1,411.96)

�� (Continued)

74

5. OTHER LONG TERM LIABILITIES


` in Crores


` in Crores

��¥>��!/¦ 486.08 459.60

*��%� 947.42 518.81

Security and other deposits received 13.11 12.76

Income received in advance 29.35 22.04

Accrued Redemption Loss on Investments 19.27 25.16

Total 1,495.23 1,038.37

6. LONG TERM PROVISIONS


` in Crores


` in Crores

��?��¥>��Q/![¦ 33.98 28.65

Provision for Contingencies [Refer Notes 6.1 & 6.2] 1,265.24 1,218.09

Provision for premium payable on redemption of Debentures 315.34 255.70

Total 1,614.56 1,502.44

6.1 Provision for Contingencies includes provisions for standard assets and all other contingencies. As per National Housing Bank Circular No. NHB/HFC/DIR.3/CMD/2011 dated August 5, 2011, and NHB/HFC/DIR.4/CMD/2012 �� :U&� Q;:Q&� �� <��%� ��&� �� %� �� are required to carry a general provision. (i) at the rate of 2% on housing loans disbursed at comparatively ��&��%��=��@��:"��Standard Assets in respect of Commercial Real Estates and (iii) at the rate of 0.40% of the total outstanding ��+��=�@��=��@��!

Accordingly, the Corporation is required to carry a minimum provision of ` 1,119.48 crores (Previous Year `�:&;/#!$Q��@��!

6.2 Movement in Provision for Contingencies Account during the year is as under: [Refer Note 32.2]

` in Crores


Opening Balance 1,218.09 803.94

Additions during the year [Refer Note 3.2] 54.24 439.36

{�� %� �� X�� *��[Refer Note 30.2]

(7.09) (25.21)

Closing Balance 1,265.24 1,218.09

�� (Continued)

75


7. SHORT-TERM BORROWINGS


` in Crores


` in Crores

Loans repayable on demand:

- From Banks - Unsecured 259.27 4.94

Deposits - Unsecured [Refer Note 7.2] 5,655.57 2,031.53

Other Loans and Advances:

- Scheduled Banks - Secured 3,285.00 14,325.00

- National Housing Bank - Secured 36.85 134.77

- Commercial Papers - Unsecured 9,550.00 4,650.00

12,871.85 19,109.77

Total 18,786.69 21,146.24

/!:� +��%��%��K��!

7.2 Deposits includes ` 21.53 crores (Previous Year ` 249.17 crores) due from related parties [Refer Note 35].

8. TRADE PAYABLES


` in Crores


` in Crores

��¥>��!/¦ 33.91 154.83

Others 26.89 23.89

Total 60.80 178.72

8.1 Trade Payables include ` Nil (Previous Year ` Nil) payable to “Suppliers” registered under the Micro, Small and Medium Enterprises Development Act, 2006. No interest has been paid/payable by the Corporation during the year to the “Suppliers” covered under the Micro, Small and Medium Enterprises Development Act, 2006. ��L��J��Corporation for this purpose.

8.2 Trade Payables include ` Nil (Previous Year ` 0.09 crores) being amount payable to HDFC Provident Fund Trust ��!

8.3 As required under Section 205C of the Companies Act, 1956, the Corporation has transferred ` 1.11 crores (Previous Year ` 0.79 crores) to the Investor Education and Protection Fund (IEPF) during the year. As of March 31, 2013, no a��*��'!

�� (Continued)

76

9. OTHER CURRENT LIABILITIES

Particulars

` in Crores


` in Crores


` in Crores

K��%<��%� 50,036.41 43,143.52 *��%� 4,254.18 2,825.95 Interest accrued and due on matured deposits 33.10 27.36 Income and other amounts received in advance 223.72 168.62 Unclaimed dividend 11.61 9.68 Unclaimed matured deposits and interest accrued thereon 310.11 276.50 Other payables- Statutory Remittances 173.86 67.47 - Grants received from Kreditanstalt für Wiederaufbau

164.78 140.90

- Amounts payable - Securitised Loans 449.39 458.11 - Amounts payable to Gratuity Fund 6.34 2.96 <��*��>��+�� 68.17 78.70 - Accrued redemption loss on Investments 9.40 3.31 - Others 24.80 25.24

5,729.46 4,084.80 Total 55,765.87 47,228.32

U!:� K��b��%��%��<��


` in Crores


` in Crores

Current maturities of long-term borrowings - Secured(i) Bonds and Debentures

- Bonds 5.00 4.70 - Non Convertible Debentures 20,013.30 13,792.00

(ii) Term Loans from Banks - Scheduled Banks 4,885.24 11,851.95�<��+��'��%��K��?��%�¥>��!#¦ - 831.00

(iii) Term Loans from other parties - Asian Development Bank 24.05 22.30 - Kreditanstalt für Wiederaufbau 10.65 10.35 - National Housing Bank 369.14 438.50Total Secured : 25,307.38 26,950.80Current maturities of long-term borrowings - Unsecured

(i) Scheduled Banks 2,100.81 1,480.63(ii) Term Loans from other parties - -

- Under a line from Kreditanstalt für Wiederaufbau 5.00 2.03(iii) Deposits [Refer Note 7.2] 22,623.22 14,710.06

Total Unsecured: 24,729.03 16,192.72Total 50,036.41 43,143.52

�� (Continued)

77


U!Q� K��%��%��%��K��mortgage of property.

9.3 Current maturities of Non-Convertible Debentures includes ` 95.00 crores (Previous Year ` 25.00 crores) and Deposits includes ` 2.69 crores (Previous Year ` 2.98 crores) from related parties [Refer Note 35].

10. SHORT-TERM PROVISIONS

Particulars March 31, 2013` in Crores


��¥>��Q/![¦ 76.01 64.25


Provision for Tax (Net of Advance Tax) 62.53 60.66

Proposed Dividend 1,932.93 1,624.67

Additional Tax on Dividend 328.50 263.56

Total 2,802.59 2,570.53

11. TANGIBLE ASSETS

` in Crores

GROSS BLOCK DEPRECIATION AND AMORTISATION NET BLOCK

As atMarch 31,

2012 Additions Deductions

As atMarch 31,

2013

As at March 31

2012For

the Year Deductions

As at March 31,

2013

As at March 31

2013

As at March 31,

2012

Land :

- Freehold 15.70 - - 15.70 - - - - 15.70 15.70

- Leasehold 3.45 - - 3.45 0.57 0.04 - 0.61 2.84 2.88

Buildings :

<��]��{� 211.07 0.05 0.04 211.08 39.02 3.44 0.02 42.44 168.64 172.05

- Leasehold Improvements 13.39 3.16 0.52 16.03 9.12 2.03 0.47 10.68 5.35 4.27

K��`�� 56.68 6.26 1.71 61.23 47.64 5.85 1.70 51.79 9.44 9.04

Furniture and Fittings:

<��]��{� 49.18 3.84 0.40 52.62 39.48 3.02 0.35 42.15 10.47 9.70

- Under Operating Lease 0.71 - - 0.71 0.60 0.02 - 0.62 0.09 0.11

]��J��!�

<��]��{� 42.86 4.45 0.95 46.36 28.28 2.85 0.71 30.42 15.94 14.58

- Under Operating Lease 0.79 - - 0.79 0.63 0.02 - 0.65 0.14 0.16

Vehicles :

<��]�� 10.32 2.19 1.39 11.12 6.33 1.52 1.08 6.77 4.35 3.99

Leased Assets :

- Plant & Machinery * 129.18 - - 129.18 129.18 - - 129.18 - -

- Vehicles * 16.37 - - 16.37 16.37 - - 16.37 - -

Total 549.70 19.95 5.01 564.64 317.22 18.79 4.33 331.68 232.96 232.48

Previous Year 542.02 18.55 10.87 549.70 310.17 17.13 10.08 317.22 232.48 231.85

* Assets held for disposal

Notes :

1) Buildings include ` 0.01 crore (Previous Year ` 0.01 crore) being the cost of shares in Co-operative Housing Societies and Limited Companies.

� Q@�� X��%��&� ��` 2.42 crores (Previous Year ` 2.42 crores) being depreciation charge on investment in Properties.

�� (Continued)

78

12. INTANGIBLE ASSETS:

` in Crores


As atMarch 31,

2012 Additions Deductions

As atMarch 31,

2013

As atMarch 31

2012For

the Year Deductions

As atMarch 31,

2013

As atMarch 31,

2013

As atMarch 31,

2012

K��+�� 5.88 5.89 - 11.77 4.41 2.38 - 6.79 4.98 1.47

Previous Year 5.52 0.36 - 5.88 3.42 0.99 - 4.41 1.47 2.10

13. NON-CURRENT INVESTMENTS (At Cost)


` in Crores


` in Crores

Trade Investments :

Equity Shares - Subsidiaries and Associate Companies 8,217.70 8,181.42

Preference Shares - Convertible - Subsidiary Company 85.00 65.00

Debentures - Redeemable - Subsidiary Company 30.00 -

Debentures - Convertible - Associate Company - 2.00

Venture Funds 176.80 627.22

Non Trade Investments :

Equity Shares 772.07 877.44

Preference Shares - Convertible 0.50 0.50

Preference Shares - Cumulative Redeemable 5.99 5.99

Debentures and Bonds - Redeemable - for Financing Real Estate Projects 163.33 163.33

Debentures and Bonds - Redeemable - Others 59.98 53.98

��%��K��+��>��<��'��%�>�� 48.77 56.72

Security Receipts - Others 22.28 15.15

Government Securities 2,762.58 1,751.14

Mutual Funds 5.00 20.00

Venture Funds 110.80 100.33

Properties [Net of Depreciation of ` 15.86 crores(Previous Year ` 13.48 crores)] 141.54 144.18

12,602.34 12,064.40

Less : Provision for Diminution in Value of Investments 70.48 52.84

12,531.86 12,011.56

�� (Continued)

79


Book Value` in Crores

Market Value` in Crores

Aggregate of Quoted Investments 5,982.39 27,365.06

Previous Year 6,093.72 22,768.95

Aggregate of Investments listed but not quoted 2,925.91

Previous Year 1,914.46

Aggregate of Investments in Unquoted Mutual Funds(Refer Note 2 below)

5.00 5.02

Previous Year 17.00 16.52

Aggregate of Unquoted Investments (Others) 3,477.02


Properties 141.54

Previous Year 144.18

12,531.86


Trade Investments

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2013` in Crores

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2012` in Crores

Equity Shares - Subsidiaries and Associate Companies (fully paid)

Subsidiaries

Credila Financial Services Pvt. Ltd. 1,89,38,670 10 22.97 1,89,38,670 10 22.97

GRUH Finance Ltd. * 10,65,38,925 2 60.74 2,13,07,785 10 60.74

HDFC Asset Management Co. Ltd. 1,50,96,600 10 235.88 1,50,96,600 10 235.88

HDFC Developers Ltd. 50,000 10 0.05 50,000 10 0.05

HDFC Education and Development Services Pvt. Ltd. 51,00,000 10 5.10 31,00,000 10 3.10

HDFC ERGO General Insurance Co. Ltd. 39,06,40,750 10 597.30 38,70,20,000 10 574.73

HDFC Holdings Ltd. 18,00,070 10 102.40 18,00,070 10 102.40

HDFC Investments Ltd. 2,66,70,500 10 66.15 2,66,70,500 10 66.15

HDFC Property Ventures Ltd. 10,00,000 10 1.00 10,00,000 10 1.00

HDFC Realty Ltd. 77,50,070 10 7.31 57,50,070 10 5.31

HDFC Sales Pvt. Ltd. 40,10,000 10 4.02 40,10,000 10 4.02

HDFC Standard Life Insurance Co. Ltd. 144,37,33,842 10 1,545.64 144,37,33,842 10 1,545.64

HDFC Trustee Co. Ltd. 1,00,000 10 0.10 1,00,000 10 0.10

HDFC Venture Capital Ltd. 4,02,500 10 0.40 4,02,500 10 0.40

HDFC Ventures Trustee Co. Ltd. 50,000 10 0.05 50,000 10 0.05

H T Parekh Foundation 1,00,09,990 10 10.01 -

2,659.12 2,622.54

�� (Continued)

80

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2013` in Crores

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2012` in Crores

Associate Companies

HDFC Bank Ltd. * 39,32,11,100 2 5,549.74 39,32,11,100 2 5,549.74

IPFonline Ltd. 3,79,860 10 6.31 3,79,860 10 6.31

India Value Fund Advisors Pvt. Ltd. 9,75,002 4 0.03 9,75,002 4 0.03

Indian Association for Savings and Credit - - - 2,99,930 10 0.30

RuralShores Business Services Pvt. Ltd. 4,76,351 10 2.50 4,76,351 10 2.50

5,558.58 5,558.88

8,217.70 8,181.42

* listed shares

Preference Shares - Convertible - Subsidiary Company

(fully paid)

0.01% Credila Financial Services Pvt. Ltd. 4,99,99,972 10 50.00 2,99,99,992 10 30.00

(Compulsorily Fully Convertible Preference Shares)

0.01% Credila Financial Services Pvt. Ltd. 3,49,99,984 10 35.00 3,49,99,984 10 35.00

(Optionally Fully Convertible Preference Shares)

85.00 65.00

Numberof

Debentures/Bonds

FaceValue per

Debenture/Bond

(`)

As atMarch 31,

2013` in Crores

Numberof

Debentures/Bonds

FaceValue per

Debenture/Bond

(`)

As atMarch 31,

2012` in Crores

Debentures - Redeemable - Subsidiary Company (fully paid)

12.75% Credila Financial Services Pvt. Ltd. 100 10,00,000 10.00 - - -



30.00 -

Debentures - Convertible - Associate Company

- Redeemable (fully paid)

6.50% Indian Association for Savings and Credit (Compulsorily Fully Convertible Debentures) - - - 20,00,000 10 2.00

- 2.00

As atMarch 31,

2013` in Crores

As atMarch 31,

2012` in Crores

Venture Funds

HDFC Investment Trust 176.80 176.80

HDFC Property Fund - Scheme IT Corridor Fund - 450.42

176.80 627.22

�� (Continued)

81


Non-Trade Investments

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2013` in Crores

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2012` in Crores

Equity Shares (fully paid)

Unlisted :

AEC Cements and Constructions Ltd. 2,80,000 10 0.28 2,80,000 10 0.28

��*��b��! 1,45,35,188 10 45.00 1,40,62,500 10 45.00

Asset Reconstruction Co. (India) Ltd. 75,41,137 10 46.37 75,41,137 10 46.37

Career Launcher Education Infrastructure & Services Ltd. 9,38,028 10 21.18 9,38,028 10 21.18

Computer Age Management Services Pvt. Ltd. 73,57,080 10 2.05 73,57,080 10 2.05

Credit Information Bureau (India) Ltd. 12,50,000 10 1.25 12,50,000 10 1.25

Feedback Ventures Pvt. Ltd. 18,10,515 10 8.97 18,10,515 10 8.97

GVFL Ltd. 1,50,000 10 0.27 1,50,000 10 0.27

Idhasoft Ltd. 4,71,06,525 1 8.21 4,71,06,525 1 8.21

INCAB Industries Ltd. 76,188 10 0.23 76,188 10 0.23

Infrastructure Development Corporation (Karnataka) Ltd. 1,50,000 10 0.15 1,50,000 10 0.15

Infrastructure Leasing & Financial Services Ltd. 1,15,87,194 10 78.11 1,23,87,194 10 83.50

IVF Advisors Pvt. Ltd. 2,000 10 0.01 2,000 10 0.01

Kesoram Textile Mills Ltd. 22,258 2 – 22,258 2 –

(received on demerger in 1999-2000)

Mahindra First Choice Wheels Ltd. 31,82,000 10 4.84 31,82,000 10 4.84

MIEL e-Security Pvt. Ltd. 1,11,112 10 4.11 1,11,112 10 4.11

National Stock Exchange of India Ltd. 73,750 10 21.45 73,750 10 21.45

Next Gen Publishing Ltd. 19,35,911 10 1.70 19,35,911 10 1.70

Novacel Life Sciences Ltd. 7,50,000 10 0.75 7,50,000 10 0.75

��*��K�<��?��L�b��!�� 250 10 0.00 250 10 0.00

OCM India Ltd. 22,56,295 10 3.41 22,56,295 10 3.41

��%�K�!��!�b��! 34,25,953 100 35.37 34,25,953 100 35.37

Tamil Nadu Urban Infrastructure Financial Services Ltd. 1,50,000 10 0.15 1,50,000 10 0.15

Tamil Nadu Urban Infrastructure Trustee Co. Ltd. 15,000 10 0.02 15,000 10 0.02

The Greater Bombay Co-operative Bank Ltd. * 40 25 0.00 40 25 0.00

The Ratnakar Bank Ltd. 88,04,680 10 58.99 88,04,680 10 58.99

TVS Credit Services Ltd. 50,00,000 10 10.00 50,00,000 10 10.00

Value & Budget Housing Corporation (India) Pvt. Ltd. 6,52,674 10 20.95 6,52,674 10 20.95

Vayana Enterprises Pvt. Ltd. 10,44,776 10 3.47 10,44,776 10 3.47

377.29 382.68

Listed :

Axis Bank Ltd. 92,000 10 11.61 92,000 10 11.61

Andhra Cements Ltd. 2,59,57,055 10 49.82 2,59,57,055 10 49.82

BASF India Ltd. 1,89,635 10 12.74 – – –

�� (Continued)

82

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2013` in Crores

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2012` in Crores

Bajaj Auto Ltd. – – – 21,000 10 2.95

Bharat Bijlee Ltd. 1,22,480 10 2.65 1,22,480 10 2.65

Bharat Heavy Electricals Ltd. – – – 7,41,930 2 16.22

Credit Analysis and Research Ltd. 2,422 10 0.18 - - -

Castrol India Ltd. 2,71,970 10 4.69 1,35,985 10 4.69

K��'��K��b��! – – – 13,30,831 10 2.02

Coromandel International Ltd. 2,69,330 2 – 2,69,330 2 -

(received under Scheme of Arrangement in 2003-04)

Crompton Greaves Ltd. 1,68,750 2 4.27 1,68,750 2 4.27

Development Credit Bank Ltd. 40,47,926 10 16.89 40,47,926 10 16.89

Engineers India Ltd. 3,11,992 5 10.86 3,11,992 5 10.86

GlaxoSmithKline Consumer Healthcare Ltd. – – – 17,902 10 4.21

Grasim Industries Ltd. 35,000 10 10.86 - - -

Hindustan Oil Exploration Co. Ltd. 1,48,26,303 10 105.50 1,48,26,303 10 105.50

Indian Oil Corporation Ltd. 1,51,000 10 4.94 1,51,000 10 4.94

Indraprastha Medical Corporation Ltd. 90,00,000 10 38.65 90,00,000 10 38.65

Infosys Technologies Ltd. 33,000 5 9.69 33,000 5 9.69

*X'K�b��!�=��*��X�� Finance Co. Ltd.) 1,70,00,000 10 17.00 2,00,00,000 10 20.00

ITC Ltd. 2,51,000 1 4.07 5,51,000 1 8.94

Larsen & Toubro Ltd. – – – 2,90,000 2 23.44

Mahindra & Mahindra Ltd. 3,15,000 5 5.87 15,10,000 5 28.15

Nestle India Ltd. 8,200 10 3.49 8,200 10 3.49

Nirlon Ltd. 9,09,000 10 5.00 9,09,000 10 5.00

NMDC Ltd. 1,66,660 1 5.00 1,66,660 1 5.00

Oil & Natural Gas Corporation Ltd. 2,10,000 5 6.97 2,10,000 5 6.97

Reliance Industries Ltd. 1,41,169 10 14.36 1,41,169 10 14.36

>��K��b��! – – – 2,62,994 10 5.35

Shipping Corporation of India Ltd. 1,28,439 10 1.80 1,28,439 10 1.80

Siemens Ltd. 10,43,100 2 36.83 12,43,100 2 43.88

State Bank of India 15,000 10 3.15 1,50,842 10 13.70

Tata Consultancy Services Ltd. – – – 1,27,995 1 5.63

Tata Steel Ltd. 1,36,448 10 7.90 1,36,448 10 7.90

Tata Motors Ltd. - DVR – – – 7,90,550 2 9.80

The Great Eastern Shipping Co. Ltd. – – – 6,40,000 10 2.48

Wipro Ltd. – – – 1,01,910 2 3.90

394.79 494.76

772.08 877.44

* Amount less than ` 50,000

�� (Continued)

83


Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2013` in Crores

Numberof

Shares

FaceValue

perShare

`

As atMarch 31,

2012` in Crores

Preference Shares - Convertible - (fully paid)

;!;Q"�V�J��`��b��! (Compulsorily Fully Convertible

Preference Shares) 2,350 10 0.50 2,350 10 0.50

0.50 0.50

Preference Shares - Cumulative Redeemable (fully paid)

0.001% BPL Ltd. 5,99,014 100 5.99 5,99,014 100 5.99

5.99 5.99

Numberof

Debentures/ Bonds

FaceValue

perDebenture/

Bond (`)

As atMarch 31,

2013 ` in Crores

Numberof

Debentures/ Bonds

FaceValue

perDebenture/

Bond (`)

As atMarch 31,

2012 ` in Crores

Debentures and Bonds - Redeemable

_ �� `�� !��z ��{��$��|- Zero Coupon Bonds- Listed Unquoted

�`?�+��V��K��?��=>��[��@�=��<�U"@ 1,50,000 10,000 63.33 1,50,000 10,000 63.33

Trent Ltd. (yield to maturity - 10%) 1,000 10,00,000 100.00 1,000 10,00,000 100.00

163.33 163.33

Debentures and Bonds - Redeemable - Others (fully paid)

Unlisted

- Others

5.64% Mandava Holdings Private Limited (yield to maturity - 14.10%) 8 5,00,00,000 39.98 8 5,00,00,000 39.98

3% Feedback Infrastructure Services Pvt. Ltd. (yield to maturity -13%) 2,00,000 1,000 20.00 1,40,000 1,000 14.00

59.98 53.98

�� (Continued)

84

As atMarch 31, 2013

` in Crores

As atMarch 31, 2012

` in Crores

!��~�� $� � ��_�� `�� !��z ��%��K�� 28.80 36.75 Security Receipts 19.97 19.97

48.77 56.72 - OthersSecurity Receipts 22.28 15.15

22.28 15.15 Government SecuritiesGovernment of India Loans 2,762.58 1,751.14

Schemes of Mutual FundsAxis Mutual Fund 0.00 2.00 DSP Blackrock Mutual Fund 0.00 5.00 Reliance Mutual Fund 0.00 5.00 M50 Exchange Traded Fund 0.00 3.00 HDFC Mutual Fund 5.00 5.00

5.00 20.00 Venture Funds Faering Capital India Evolving Fund 11.54 7.20 Gaja Capital India Fund 8.10 6.10 HDFC Property Fund - Scheme HDFC India Real Estate Fund 37.90 40.60 India Value Fund 38.85 36.23 India Venture Trust 4.85 4.85 �� 4.50 1.50 ��K��'�� 5.06 3.85

110.80 100.33

Notes :

1) Unquoted investments include ` 14.03 crores (Previous Year `�QQ!Q;��@��J��&��are subject to a lock-in period and include ` 20.95 crores (Previous Year ` 20.95 crores) in respect of equity ��&��!��` Nil (Previous Year ` 4,013.97 ��@��J��L<��` 60.74 crores (Previous Year `��;!/��@��J��&��!�

2) Market value of Investments in Unquoted Mutual Funds represents the repurchase price of the units issued by the Mutual Funds.

[@� �`?�+��V��K��?��K��+��Q=�$@��*�� &�:U�:!

14. DEFERRED TAX ASSET

� *��%�+��%��%�� *��m�=�+�QQ@&��Companies (Accounting Standards) Rules, 2006, the Corporation has taken credit of ` 3.18 crores (Previous Year `�:Q��@��+��b��\��[:&�Q;:[�� asset (net) for the year, arising on account of timing differences and ` NIL. (Previous Year ` 168.07 crores) has been adjusted against the utilisation from Additional Reserve u/s 29C as per Note no. 3.2.

�� (Continued)

85


The major components of deferred tax assets and liabilities are:` in Crores

Particulars Assets Liabilities

Current Year Previous Year Current Year Previous Year

a) Depreciation 49.82 49.44

b) Provision for Contingencies 630.67 572.41

��@��?�� 26.12 20.42

d) Accrued Redemption Loss (net) 9.74 9.23

e) Others (net) 14.67 75.58

Total 681.20 677.64 49.82 49.44

Net Deferred Tax Asset 631.38 628.20

15. LONG-TERM LOANS AND ADVANCES

` in Crores


` in Crores


` in Crores

Loans: [Refer Notes 15.3, 15.4 and 15.5]

Secured:

- Individuals 1,04,820.04 83,670.99

- Corporate Bodies 46,037.06 40,842.98

- Others 1,249.10 1,471.57

1,52,106.20 1,25,985.54

Less: Provision for Non-performing loans [Refer Note 6.1 and 15.7] (including additional provision made by the Corporation) (475.33) (452.89)

1,51,630.87 1,25,532.65

Others:

Corporate Deposits [Refer Notes 15.2 & 15.6] - 647.70

Capital Advances - Unsecured; considered good 11.45 4.30

Security Deposits - Unsecured; considered good 166.98 162.10

*��<�+��%�� 79.17 73.77

Other Long-term Loans and Advances:

- Staff Loans Others - Secured; considered good (Refer Note 15.1)

14.75 10.99

- Prepaid Expenses - Unsecured; considered good 112.14 106.98

- Advance Tax (Net of Provision) 1,433.07 961.42

1,817.56 1,967.26

Total 1,53,448.43 1,27,499.91

�� (Continued)

86

15.1 Loans includes amounts due from the directors ` 0.15 crores (Previous Year ` 0.17 crores) [Refer Note 35].

:#!Q� *��X��&��%��K��&�+��>��K��X��%��` 212.10 crores (Previous Year `�$�#!;#��@��%�>��!��X��&��%��K��+��>��|��:[!

15.3 Loans granted by the Corporation aggregating to ` 1,50,256.20 crores (Previous Year ` 1,24,368.87 crores) are secured or partly secured by:

(a) Equitable mortgage of property and/or (b) Pledge of shares, units, other securities, assignment of life insurance policies and/or (c) Hypothecation of assets and/or (d) Bank guarantees, company guarantees or personal guarantees and/or (e) Negative lien and/or (f) Assignment of hire purchase receivables and/or (g) Undertaking to create a security.

15.4 Loans include ` 27.99 crores (Previous Year ` 34.78 crores) in respect of properties held for disposal under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

15.5 Long term loans and advances includes non-performing loans of ` 1,198.86 crores (Previous Year ` 1,069.13 crores).

15.6 Out of the Corporate Deposits, amounts aggregating to ` Nil (Previous Year ` 645 crores) are secured.

15.7 Movement in Provision for Non-Performing Loans is as under: [Refer 32.2]


` in Crores


` in Crores

Opening Balance 452.89 320.43 Additions during the year [Refer Note 3.2] 39.05 158.64 {��%��b�� (16.61) (26.18)Closing Balance 475.33 452.89

16. OTHER NON-CURRENT ASSETS


` in Crores


` in Crores

Unamortised discount on Non-Convertible Debentures 20.22 36.56 Receivables on Securitised Loans 246.14 122.51 Foreign Currency Monetary Items Translation Difference Account[Refer Note 4.9]

123.28 140.39

Interest accrued but not due on Loans 230.20 129.82 Interest accrued but not due on Bank Deposits 0.01 25.68 Income accrued but not due on Investments 45.13 16.53 Advance against Investment in Properties 52.43 54.52 ?��L�X��[Refer Note 16.1]

62.34 528.55

Total 779.75 1,054.56

:�!:� ?��L��L��` 62.23 crores (Previous Year ` 63.50 crores) against foreign currency loans.

�� (Continued)

87


17. CURRENT INVESTMENTSAs at


As atMarch 31, 2012

` in Crores

Held as Current Investments (At cost or market value whichever is lower unless stated otherwise)Debentures and Bonds - Redeemable 45.00 144.03 K��X�� 522.99 -Current maturities of Long Term Investments (at cost)Debentures and Bonds - Redeemable 2.00 -Security Receipts - 8.55 Government Securities 74.69 28.47 Venture Funds & Other Funds 437.06 25.09

1,081.74 206.13 Less : Provision for Diminution in Value of Investments 0.14 10.70

1,081.60 195.44

Book Value Market Value` in Crores ` in Crores

Aggregate of Quoted Investments 34.86 36.14Previous Year 35.00 34.51 Aggregate of Investments listed but not quoted 84.69 Previous Year 48.47 Aggregate of Unquoted Investments (Others) 962.05Previous Year 111.97

1,081.60 Previous Year 195.44

Numberof

Debentures/Bonds

FaceValue per

Debenture/Bond

(`)

As atMarch 31,

2013` in Crores

Numberof

Debentures/Bonds

Face Value per

Debenture/Bond

(`)

As atMarch 31,

2012` in Crores

Held as current investments

Debentures and Bonds - Redeemable (fully paid)

- Unlisted

11.50% Andhra Cements Ltd. - 35,00,000 100 35.00

0% Reliance Industries Ltd. - 4,31,617 100 4.32

11.50% Deccan Chronicle Holdings Ltd. 500 10,00,000 49.71

- Listed Unquoted

12.00% Cholamandalam DBS Finance Ltd. - 100 10,00,000 10.00

11.25% Development Credit Bank Ltd. 100 10,00,000 10.00 100 10,00,000 10.00

- Listed Quoted

9.00% Coromandel International Ltd. (bonus) 2,69,330 15 - - - -

12.00% Muthoot Finance Ltd. 2,50,000 1,000 25.00 2,50,000 1,000 25.00

12.15% Religare Finvest Ltd. 1,00,000 1,000 10.00 1,00,000 1,000 10.00

Total 45.00 144.03

�� (Continued)

88


` in Crores


` in Crores

� �� Z ��

State Bank of Bikaner and Jaipur (yield to maturity - 14%) 99.58 -

Corporation Bank (yield to maturity - 14%) 248.95 -

Kotak Mahindra Bank Ltd. (yield to maturity - 14%) 174.46

522.99 -

Numberof

Debentures/Bonds

FaceValue per

Debenture/Bond

(`)


` in Crores


` in Crores

Current maturities of Long Term Investments

Debentures and Bonds - Redeemable (fully paid)

6.50% Indian Association for Savings and Credit 20,00,000 10 2.00 -

2.00 -


` in Crores


` in Crores

Security Receipts - 8.55

- 8.55

Government Securities

Government of India Loans 74.69 28.47

Venture Funds and Other Funds

India Value Fund 11.06 8.37

Tamil Nadu Urban Development Fund 16.72 16.72

HDFC Property Fund - Scheme HDFC IT Corridor Fund 409.28 -

437.06 25.09

18. TRADE RECEIVABLES


` in Crores


` in Crores

Trade Receivables - Unsecured; Considered Good, less than six months 1.32 60.21

Total 1.32 60.21

�� (Continued)

89


19. CASH AND BANK BALANCES


` in Crores


` in Crores

(a) Cash and cash equivalents

��=�@� ?��L��

In Current Accounts 786.20 964.99

��*��X��%��[�� 2,500.00 1,500.00

��=��@� ?��>��?��L��*�� - 0.06

(iii) Cash on hand 0.88 0.47

(iv) Cheques on hand 36.97 33.88

3,324.05 2,499.40

(b) Other Bank balances

��=�@� ��L��L��<�{�� 11.61 9.68

(ii) Other - Against Foreign Currency Loans [Refer Note 4.4] 5.41 4.76

(iii) Short-term bank deposits 2,410.07 2,959.01

Total 5,751.14 5,472.85

20. SHORT-TERM LOANS AND ADVANCES

Particulars

` in Crores


` in Crores


` in Crores

Loans: [Refer Note 20.1]

Current maturities of long-term loans and advances 17,939.97 14,889.04

Others:

Current maturities of Staff Loans others - Secured; Considered good 3.54 2.83

Corporate Deposits [Refer Notes 20.2, 20.3 & 20.5] 1,688.72 2,662.54

*��<�+��K��good 706.71 439.46

Other Advances - Unsecured; Considered good [Refer Note 20.4] 56.80 1,884.43

Security Deposits - Unsecured; Considered good 6.12 8.89

Others - Unsecured considered doubtful 49.71 -

2,511.60 4,998.15

Less : Provision for Doubtful Receivables[Refer Notes 3.2 & 32.2] 51.71 -

Sub Total 2,459.89 4,998.15

Total 20,399.86 19,887.19

�� (Continued)

90

20.1 Out of Current maturities of Long term loans and advances, amounts aggregating ` 16,933.97 crores (Previous Year ` 13,480.91 crores) are secured [Refer Note 15.3].

20.2 Out of the Corporate Deposits, amounts aggregating to ` 1,192.42 crores (Previous Year ` 2,101.44 crores) are secured and amounts aggregating to ` 2 crores (Previous Year ` Nil) considered as doubtful.

20.3 Corporate Deposits includes amounts due from the related parties ` 10.00 crores (Previous Year ` 29.10 crores) [Refer Note 35].

20.4 Other Advances includes amounts due from the related parties ` 10.05 crores (Previous Year ` 8.86 crores) [Refer Note 35].

20.5 Corporate Deposits amounting to ` 834.66 crores (Previous Year `�Q&:;$!��@��%�Real Estate Projects.

20.6 Current maturities of staff loans includes amounts due from the directors ` 0.02 crores (Previous Year ` 0.02 crore) [Refer Note 35].

21. OTHER CURRENT ASSETS


` in Crores


` in Crores

Foreign Currency Monetary Items Translation Difference Account [Refer Note 4.9] 46.51 65.85

Unamortised Discount on Commercial Paper 242.13 116.37

Receivables on Securitised Loans 18.04 3.47

Interest accrued but not due on Loans 160.45 119.44

Income accrued but not due on Investments 73.41 69.86

Interest accrued but not due on Deposits 125.93 101.08

Application money - Investments 1.00 -

Total 667.47 476.07

22. CONTINGENT LIABILITIES AND COMMITMENTS

22.1 Contingent Liability in respect of guarantees provided by the Corporation aggregated to ` 203.00 crores (Previous Year ` 783.95 crores).

22.2 Contingent liability in respect of income-tax demands, net of amounts provided for and disputed by the Corporation, amounts to ` 818.73 crores (Previous Year ` 606.17 crores). The matters in dispute are under ��!��~��favour of the Corporation.

22.3 Contingent Liability in respect of corporate undertakings provided by the Corporation for securitisation of receivables aggregated to ` 1,939.31 crores (Previous Year `�:&U�;!:[��@!� ��|��&��&��|��!

QQ!�� K��%��b�� &�� &�� m��+*K��K��` 0.15 crores (Previous Year ` 0.15 crores).

22.5 Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is ` 102.34 crores (Previous Year ` 206.70 crores).

�� (Continued)

91


23. REVENUE FROM OPERATION

Current Year` in Crores


Interest Income :

- Interest on Loans 18,944.11 15,248.42

- Other Interest [Refer Note 23.1] 873.06 800.53

- Net Gain/(Loss) on foreign currency transaction and translation 1.18 105.98

Income from Leases 4.26 9.84

Dividends [Refer Note 23.2] 480.66 309.66

Surplus from deployment in Cash Management Schemes of Mutual Funds [Refer Note 23.3]

252.34 319.78

Fees and Other Charges [Refer Note 23.4] 241.34 268.37

Total 20,796.95 17,062.58

23.1 a) Other Interest includes Interest on Investments amounting to ` 328.99 crores (Previous Year ` 203.22 crores), including ` 9.79 crores (Previous Year ` 15.29 crores) in respect of current investments.

b) Other Interest includes Interest on Income Tax Refund ` 5.83 crores (Previous Year ` Nil).

23.2 a) Dividend income includes ` 269.42 crores (Previous Year ` 148.21 crores) received from subsidiary companies.

b) Dividend income includes ` 0.38 crores (Previous Year ` 2.40 crores) in respect of current investments.

23.3 Surplus from deployment in Cash Management Schemes of Mutual Funds amounting to ` 252.34 crores (Previous Year ` 319.78 crores) is in respect of investments held as current investments.

23.4 Fees and Other Charges is net of the amounts paid to Direct Selling Agents ` 264.00 crores (Previous Year ` 248.54 crores).

24.� �@� ��` 0.83 crores (Previous Year ` Nil) in respect of investments held as current investments.

� �@� ��` 0.77 crores (Previous Year ` Nil) on account of sale of shares of Indian Association for Savings and Credit (Associate Company) and ` Nil (Previous Year ` 0.12 crores) on account of shares bought back by India Value Fund Advisors Pvt. Ltd. (Associate Company).

25. Other Income includes rent of ` 10.15 crores (Previous Year `�:;!;;��@&��` 0.10 crores (Previous Year ` 0.24 crores) is in respect of rent for certain assets given on operating lease and also includes sub-lease payments received ` 0.31 crores (Previous Year ` 0.07 crores) in respect of a property acquired under operating lease as per Note 28.1.

25.1 Earning in foreign currency:` in Crores

Current year Previous Year

Interest on Bank Deposits 3.59 2.95

Consultancy and other fees 12.52 8.24

�� (Continued)

92

Q#!Q� *�� %� +�� b��m� =�+� :U@&� �� K�� =��%�+��@�>��&�Q;;�&��%��]��%�b��

Income from Leases includes ` 4.14 crores (Previous Year ` 4.46 crores) in respect of properties and certain assets leased out by the Corporation under Operating Leases. Out of the above, in respect of the non-cancellable ��&��

` in Crores

Period Current Year Previous Year

Not later than one year 2.63 4.02

b�� 3.58 5.77

b�� - 1.05

26. FINANCE COSTCurrent Year

Previous Year` in Crores` in Crores ` in Crores

Interest

- Loans 2,187.03 3,045.62

- Deposits 4,456.86 2,964.51

- Bonds and Debentures 5,916.46 4,161.95

- Commercial Paper 1,073.64 701.01

13,633.99 10,873.09

Net Loss on foreign currency transaction and translation 165.78 220.27

Other Charges 91.12 63.42

Total 13,890.89 11,156.78

26.1 Other Charges includes Exchange loss of ` 0.10 crore (Previous Year net of Exchange gain of ` 0.97 crore).

26.2 A net gain of ` 53.23 crores (Previous Year `�Q#![��@��%�� +��b��%��%��%��

` in Crores


Exchange (Gain) / Loss on Translation

- Foreign Currency Denominated Assets and Foreign Currency� ?��%��¥>��!U¦ (131.72) (54.87)

<�K��K��*��>��+��¥>��!/¦ 78.49 29.51

Net (Gain)/Loss on Translation [Refer Note 4.9] (53.23) (25.36)

26.3 Expenditure in foreign currency:` in Crores


Interest and Other Charges on Loans 27.95 27.44

Others 23.01 14.72

�� (Continued)

93


27. STAFF EXPENSES [Refer Note 27.3]

ParticularsCurrent Year ` in Crores

Previous year` in Crores

Salaries and Bonus [Refer Notes 27.1 & 27.2] 196.84 165.72 Contribution to Provident Fund and Other Funds 38.02 30.37 Staff Training and Welfare Expenses 11.33 9.70 Total 246.19 205.79

27.1 Salaries and Bonus include ` 12.03 crores (Previous Year `�$!//��@��b��%��?��and has been actuarially determined as per the AS 15 (Revised).

Q/!Q� � ��Q/��+��` 3.00 crores (Previous Year ` 1.82 crores).


� *�� %� +�� ?�� =�+� :#@� =>�� Q;;#@� �� K��=��%�+��@�>��&�Q;;�&��%��

� ��K��%��%��+��b��as under :

Particulars Current Year ` in Crores


Provident Fund 9.96 8.33Superannuation Fund 7.14 5.86Employees’ Pension Scheme-1995 1.22 1.13

The Rules of the Corporation’s Provident Fund administered by a Trust require that if the Board of Trustees are unable to pay interest at the rate declared for Employees’ Provident Fund by the Government under para 60 of the Employees’ Provident Fund Scheme, 1952 for the reason that the return on investment is less or for ��&��%��K��!�*��` Nil (Previous Year `�;!:#��@&� ��+��%��O�� &��%��Corporation.

� ��K��m��<��%��<��%��

` in Crores


�� Liability at the beginning of the year 107.69 94.24Current Service Cost 4.21 3.90Interest Cost 9.14 7.80?�� (6.48) (6.54)Actuarial loss 13.57 8.29Liability at the end of the year * 128.13 107.69* The Liability at the end of the year ` 128.13 crores (Previous Year ` 107.69 crores) includes ` 34.52 crores (Previous Year ` 29.18 crores) in respect of an un-funded plan.

�� (Continued)

94

` in Crores


Fair Value of Plan Assets:

Fair Value of Plan Assets at the beginning of the year 75.56 60.17

Expected Return on Plan Assets 7.65 6.16

Contributions 16.94 20.38

?�� (6.48) (6.54)

Actuarial loss on Plan Assets (6.16) (4.61)

Fair Value of Plan Assets at the end of the year 87.51 75.56

Total Actuarial loss to be recognised (19.73) (12.90)

Actual Return on Plan Assets:

Expected Return on Plan Assets 7.65 6.16

Actuarial loss on Plan Assets (6.16) (4.61)

Actual Return on Plan Assets 1.49 1.55

`�� !��"��

Current Service Cost 4.21 3.90

Interest Cost 9.14 7.80

Expected Return on Plan Assets (7.65) (6.16)

Net Actuarial loss to be recognised 19.73 12.90

� ��%��b��¡+�� ¢� 25.43 18.44

Reconciliation of the Liability Recognised in the Balance Sheet:

Opening Net Liability 32.13 34.07

Expense recognised 25.43 18.44

Contribution by the Corporation 16.94 20.38

Amount recognised in the Balance Sheet under “Provision for Employee ?��¢�` 34.52 crores (Previous Year ` 29.18 crores) and under “Other Current Liabilities” ` 6.10 crores (Previous Year ` 2.95 crores) 40.62 32.13

�� (Continued)

95


` in Crores

Particulars 2012-13 2011-12 2010-11 2009-10 2008-09

Amount Recognised in the Balance Sheet:

Liability at the end of the year 128.13 107.69 94.24 81.40 69.60

Fair Value of Plan Assets at the end of the year 87.51 75.56 60.17 53.86 46.93

Amount recognised in the Balance Sheet under ¡��?��¢��¡]��K��Liabilities” 40.62 32.13 34.07 27.54 22.67

Experience Adjustment :

On Plan Liabilities 17.25 10.58 7.13 7.04 3.94

On Plan Assets (6.16) (4.61) (3.36) (2.91) (2.32)

Estimated Contribution for next year 8.03 6.79 5.79 4.72 2.05

Investment Pattern:

Particulars % Invested Current Year

% Invested Previous Year

Central Government securities 23.13 21.84

State Government securities/securities guaranteed by State/Central Government 1.00 1.69

Public Sector/Financial Institutional Bonds 27.56 24.85

Private Sector Bonds 10.91 15.49

Special Deposit Scheme 2.52 2.92

K��X�� 1.69 3.26

X��?��L��'��*�� 3.47 3.49

Equity Shares 20.52 20.57

Others (including bank balances) 9.20 5.89

Total 100.00 100.00

Based on the above allocation and the prevailing yields on these assets, the long term estimate of the expected rate of return on fund assets has been arrived at.

Principal Assumptions:


% %

Discount Rate 8.25 8.50

Return on Plan Assets 8.60 8.60

Salary Escalation 5.00 5.00

��&��L��|��&��&�promotion and other relevant factors.

�� (Continued)

96

28. ESTABLISHMENT EXPENSES



Rent [Refer Note 28.1] 52.73 32.05

Rates and Taxes 3.34 2.93

Repairs and Maintenance - Buildings 5.72 5.41

��]�� 1.97 1.84

Electricity Charges 11.30 9.81

Insurance Charges 0.62 0.53

Total 75.68 52.57

28.1 *�� %� +�� b��m� =�+� :U@&� �� K�� =��%�+��@�>��&�Q;;�&��%��]��%�b��

The Corporation has acquired properties under non-cancellable operating leases for periods ranging from 12 months to 36 months. The total minimum lease payments for the current year, in respect thereof, included under Rent, amounts to ` 26.79 crores (Previous Year ` 2.65 crores). Out of the above, the Corporation has sub-leased a property, the total sub-lease payments received in respect thereof included under Other Income amount to ` 0.31 crores (Previous Year ` 0.07 crores). The future minimum lease payments in respect of the ��J��<��%��

` in Crores

Period Current Year Previous Year

Not later than one year 32.50 2.57

b�� 30.88 3.78

29. OTHER EXPENSES

Particulars Current Year` in Crores


Travelling and Conveyance 16.63 14.61

Printing and Stationery 7.00 6.31

Postage, Telephone and Fax 19.92 18.03

Advertising 24.06 24.20

Repairs and Maintenance - Other than Buildings 6.75 5.92

]��\�� 16.97 15.31

Legal Expenses 14.45 9.99

Computer Expenses 10.17 8.45

Directors’ Fees and Commission 3.13 2.70

Miscellaneous Expenses [Refer Notes 29.1 & 29.2] 71.27 65.61

Auditors’ Remuneration [Refer Note 29.4] 3.08 1.85

Total 193.43 172.98

�� (Continued)

97


29.1 Miscellaneous Expenses exclude ` 9.13 crores (Previous Year ` 6.89 crores) in respect of amounts utilised

out of Shelter Assistance Reserve during the year.

29.2 Miscellaneous Expenses include Provision for Wealth Tax amounting to ` 0.60 crores (Previous Year ` 0.65

crores) and Securities Transaction Tax amounting to ` 0.45 crores (Previous Year ` 0.23 crores).

QU![� � �� QU� �� \��

expenses ` Nil (Previous Year ` 0.89 crores).

29.4 Auditors’ Remuneration:

` in Crores


Audit Fees 1.05 0.81

Tax Matters 0.84 0.27

Other Matters 1.00 0.66

Reimbursement of Expenses 0.01 0.01

Service Tax 0.36 0.20

Less: Service tax input credit availed (0.18) (0.10)

3.08 1.85

Audit Fees include ` 0.03 crores (Previous Year ` 0.03 crores) paid to Branch Auditors.

30. PROVISION FOR NON PERFORMING LOANS

30.1 As per the Housing Finance Companies (NHB) Directions, 2010, non-performing assets are recognised on the

basis of ninety days overdue. The total provision carried by the Corporation in terms of paragraph 29 (2) of

the Housing Finance Companies (NHB) Directions, 2010 and NHB circular NHB.HFC. DIR-3/CMD/2011 dated

��%��#&�Q;::��`��%��<`��%�b��¥>��:#¦�

` in Crores

Particulars Sub-Standard Assets Doubtful Assets


Housing 52.60 74.16 179.31 182.33

Non-Housing 72.07 39.12 30.48 30.42

[;!Q� ��K��%��+��b��X��

Value of Investments amounting to ` 7.09 crores (Previous Year ` 25.21 crores). The balance of the Provision

represents provision made against non-performing assets and other contingencies [Refer Note 6.2].

�� (Continued)

98

31.� *�� %� +�� %�� +��m� =�+� Q;@&� �� K��

(Accounting Standards) Rules, 2006 :

� =�@� *�� %� �� ?�� %�� +��&� �� ` 4,848.34 crores (Previous Year

` 4,122.62 crores) has been adjusted for amounts utilised out of Shelter Assistance Reserve of ` 9.13

crores (Previous Year ` 6.89 crores).

� � ��%�� ?��%��+��

of ` 4,839.21 crores (Previous Year `��&::#!/[��@�� %��%��

during the year of 151.97 crores (Previous Year 147.17 crores).

� =��@� ��?��X��%��+��

Amount in `


Basic Earnings Per Share 31.84 27.97

Effect of outstanding Stock Options (0.39) (0.43)

Diluted Earnings Per Share 31.45 27.54

� =��@� �� ?�� %�� +�� %� ��

��%��%��J��X��%��

+��%�� %��%��

equity shares, after giving dilutive effect of the outstanding Stock Options for the respective periods.

��

Numbers in Crores


Weighted average number of shares for computation of Basic

Earnings Per Share

151.97 147.17

Diluted effect of outstanding Stock Options 1.90 2.30

Weighted average number of shares for computation of Diluted

Earnings Per Share

153.87 149.47

�� (Continued)

99


32. Summary of total Borrowings, Loans and Investments

Total Borrowings ` in Crores

Term-wise Break-up Current Year Previous Year

b��%<��%� 90,005.01 74,837.74

+��<��%� 18,786.69 21,146.24

K��%<��%� 50,036.41 43,143.52

1,58,828.11 1,39,127.50

Category-wise Break-up

Bonds and Debentures 79,521.40 57,488.10

Term Loans:

- Banks 15,984.62 38,676.69

- Others 1,839.27 2,019.91

- Commercial Papers 9,550.00 4,650.00

Deposits 51,932.82 36,292.80

1,58,828.11 1,39,127.50

Total Loans ` in Crores

Term-wise Break-up Current Year Previous Year

Long-term loans 1,52,106.20 1,25,985.54

Current maturities of long-term loans 17,939.97 14,889.04

1,70,046.17 1,40,874.58

Less: Provision for non performing loans (475.33) (452.89)

Net Loan Book: 1,69,570.84 1,40,421.69

Category-wise Break-up

Individual 1,11,320.65 88,777.85

Corporate Bodies 56,956.65 50,189.60

Others 1,768.87 1,907.13

1,70,046.17 1,40,874.58

Less: Provision for non performing loans (475.33) (452.89)

Net Loan Book: 1,69,570.84 1,40,421.69

Total Investments ` in Crores


Non-Current Investments 12,531.86 12,011.56

Current Investments 1,081.60 195.44

13,613.46 12,207.00

�� (Continued)

100

32.1 Summary of total provision for contingencies:


` in Crores


` in Crores

Provision for Contingencies Account [Refer Note 6.2] 1,265.24 1,218.09

Provision for Non-Performing Loans [Refer Note 15.7] 475.33 452.89

Provision for doubtful receivables [Refer Note 20] 51.71 -

Total 1,792.28 1,670.98

33. DISCLOSURE REQUIRED BY NATIONAL HOUSING BANK

�� %� �� %�� !� �`?~�X~X>+~��<No.35/2010-11 dated October 11, 2010 issued by the National Housing Bank.

(a) Capital to Risk Assets Ratio (CRAR)


1) CRAR (%) 16.35 14.61

2) CRAR – Tier I Capital (%) 13.85 11.63

3) CRAR – Tier II Capital (%) 2.50 2.98

(b) Exposure to Real Estate Sector ` in Crores

1. Direct Exposure Current Year Previous Year

A Residential Mortgages :

Lending fully secured by mortgages on residential property �� !�Individual Housing Loans upto ` 15 Lacs : ` 22,509.70 crores (Previous Year ` 21,417.04 crores) 1,08,054.76 86,536.16

B Commercial Real Estate : Lending secured by mortgages on commercial real estate 27,828.64 25,920.95

C Investments in Mortgage Backed Securities (MBS) and other securitised exposures –

(i) Residential 28.80 36.75

(ii) Commercial Real Estate Nil Nil

2. Indirect Exposure

Fund based and non-fund based exposures on National Housing Bank (NHB) and Housing Finance Companies (HFCs) 124.07 124.07

In computing the above information, certain estimates, assumptions and adjustments have been made by the M��%��!

�� (Continued)

101


(c) Asset Liability Management

Maturity pattern of certain items of assets and liabilities as on March 31, 2013:

� � ��b��L��%��Housing Bank.

Current Year ` in Crores

Maturity Buckets Liabilities Assets

?��%��Banks

\��L��?��%� Advances Investments

1 day to 30 days (one month) 709.27 2,223.75 2,594.45 524.99

Over one month to 2 months 353.25 355.00 2,629.28 -

Over 2 to 3 months 476.51 1,347.50 2,843.57 1,009.28

Over 3 to 6 months 867.24 3,326.25 8,929.89 403.90

Over 6 months to 1 year 2,474.98 8,468.30 15,865.27 2,285.04

Over 1 to 3 years 4,557.90 25,631.17 52,850.07 267.89

Over 3 to 5 years 3,611.72 26,594.18 36,811.29 229.09

Over 5 to 7 years 1,933.75 11,210.15 22,156.78 8,393.94

Over 7 to 10 years 1,000.00 8,915.10 14,903.68 -

Over 10 years - 1,000.00 9,986.56 499.33

Total 15,984.62 89,071.40 1,69,570.84 13,613.46

Maturity pattern of certain items of assets and liabilities as on March 31, 2012:

� � ��b��L��%��Housing Bank.


Maturity Buckets Liabilities Assets

?��%��Banks

\��L��?��%� Advances Investments

1 day to 30 days (one month) 432.42 - 3,037.91 -

Over one month to 2 months 2,018.56 1,693.26 1,939.41 480.24

Over 2 to 3 months 2,779.26 663.60 2,190.72 36.25

Over 3 to 6 months 2,883.64 3,740.00 6,066.95 952.98

Over 6 months to 1 year 5,167.97 5,782.35 12,653.87 974.85

Over 1 to 3 years 13,276.42 12,069.26 43,174.07 571.13

Over 3 to 5 years 7,126.43 17,499.72 28,748.75 326.91

Over 5 to 7 years 3,391.99 10,617.57 18,994.03 8,329.54

Over 7 to 10 years 1,100.00 9,068.15 14,637.79 9.00

Over 10 years 500.00 1,004.19 8,978.19 526.10

Total 38,676.69 62,138.10 1,40,421.69 12,207.00

In computing the above information, certain estimates, assumptions and adjustments have been made ��\��%��!

�� (Continued)

102

34. DIVIDEND PAYABLE TO NON-RESIDENT SHAREHOLDERS

The Corporation has not remitted any amount in foreign currencies on account of dividends during the year �� &��&��%��of dividends have been made by/on behalf of non-resident shareholders. The particulars of dividends payable to non-resident shareholders (including Foreign Institutional Investors) are as under:

Particulars Current YearAnnual

Previous Year Annual

�� 2011-12 2010-11

Number of non-resident shareholders 4,750 4,277

Number of shares held by them of Face Value of ` 2 each 105,85,88,251 107,37,73,004

Gross amount of dividend (in `) 1164,44,70,761 966,39,57,036

35. RELATED PARTY TRANSACTIONS

��%�+��>��X��m�=�+�:$@&��K��=��%�+��@�>��&�Q;;�&��K��

A) Subsidiary Companies

HDFC Developers Ltd. HDFC Investments Ltd.

HDFC Holdings Ltd. HDFC Asset Management Company Ltd.

HDFC Trustee Company Ltd. HDFC Realty Ltd.

HDFC Standard Life Insurance Company Ltd. HDFC ERGO General Insurance Company Ltd.

HDFC Venture Capital Ltd. HDFC Sales Pvt. Ltd.

HDFC Ventures Trustee Company Ltd. HDFC Property Ventures Ltd.

GRUH Finance Ltd. Credila Financial Services Pvt. Ltd

Griha Investments (Subsidiary of HDFC Holdings Ltd.) Griha Pte. Ltd. (Subsidiary of HDFC Investments Ltd.)

HDFC Education and Development Services Pvt. Ltd. (w.e.f. 28th December 2012)

HDFC Asset Management Company (Singapore) Pte. Ltd. HDFC Life Pension Fund Management Company Ltd.

(Subsidiary of HDFC Asset Management Company Ltd.) (Subsidiary of HDFC Standard Life Insurance Company Ltd.)

H. T. Parekh Foundation (w.e.f. 19th October, 2012)

B) Associate Companies C) Entities over which control is exercised

HDFC Bank Ltd. HDFC Property Fund - Scheme - HDFC IT Corridor Fund

India Value Fund Advisors Pvt. Ltd. HDFC Investment Trust

RuralShores Business Services Pvt. Ltd.

IPF. Online Ltd.

Indian Association for Savings and Credit (Up to 26th September, 2012)

D) Key Management Personnel E) Relatives of Key Management Personnel

Mr Keki M. Mistry (where there are transactions)

Ms Renu Sud Karnad \��!�\�� \��>��>!�+��

Mr V. Srinivasa Rangan Mr Ashok Sud Ms Riti Karnad

\�� \��+��+��

Ms Abhinaya S. Rangan

�� (Continued)

103


*@� ��K��%��&��

` in Crores

Particulars

Subsidiary Companies Associates

Entities over which control is exercised

Key Management Personnel

Relatives of Key Management Personnel

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

INCOME/TRANSACTION

Dividend 269.42 148.21 169.38 129.92 0.05 0.12 - - - -

Interest 5.55 3.12 9.89 6.39 100.11 21.49 - - - -

Consultancy & Other Fees 14.60 17.96 - - - - - - - -

Rent 17.75 3.03 1.71 1.68 - - - - 0.01 0.03

Other Income 0.26 0.11 44.64 29.54 - - - - - -

EXPENDITURE/TRANSACTION

Interest 53.08 45.00 3.71 1.02 - - 0.47 0.41 0.05 0.07

Bank & Other Charges - - 1.49 1.53 - - - - - -

Remuneration - - - - - - 16.72 13.36 - -

Other Expenses 127.04 98.61 138.16 105.26 - - - - 0.09 0.06

ASSETS

Investments 2,774.12 2,687.54 5,558.58 5,560.88 586.08 627.22 - - - -

Loans 13.27 - - - - - 0.17 0.19 - -

Corporate Deposits 7.00 29.10 3.00 - - - - - - -

Bank Balance and Deposits - - 821.68 1,439.29 - - - - - -

Trade Receivable 0.01 0.02 - 8.31 - - - - - -

Others 10.00 8.76 2.19 2.08 - - - - - -

LIABILITIES

Deposits 21.53 249.17 0.17 0.17 - - 5.30 3.87 0.40 0.45

Non-Convertible Debentures 720.00 605.00 - - - - - - - -

Others 27.27 21.47 1.04 3.41 - - 0.21 0.19 0.03 0.04

During the year, the Corporation has sold individual loans amounting to ` 5,125 crores (Previous Year ` 4,978 crores) to HDFC Bank Ltd. and Corporate Loan amounting to ` 50 crores (Previous Year ` Nil) to HDFC Standard Life Insurance Co. Ltd.

�� (Continued)

104

**@�� K�� %� �� &� ��

` in Crores

Particulars


AssociatesEntities over which control is exercised


Relatives of Key Management

PersonnelCurrent

YearPrevious

YearCurrent

YearPrevious

YearCurrent

YearPrevious

YearCurrent

YearPrevious

YearCurrent

YearPrevious

YearINCOME/TRANSACTIONDividend - HDFC Asset Management Co. Ltd. 66.43 49.82 - - - - - - - - - HDFC Bank Ltd. - - 169.08 129.76 - - - - - - - HDFC Holdings Ltd. 50.85 - - - - - - - - - - HDFC Investment Ltd. 120.02 60.01 - - - - - - - -Interest - HDFC Bank Ltd. - - - 6.08 - - - - - - - HDFC Investment Trust - - - - - 3.93 - - - - - HDFC IT Corridor Fund - - - - 94.67 17.56 - - - -Consultancy & Other Fees - HDFC Asset Management Co. Ltd. 14.38 17.62 - - - - - - - -Rent - HDFC Asset Management Co. Ltd. 9.87 2.66 - - - - - - - - - HDFC ERGO General Insurance Co. Ltd. 4.96 - - - - - - - - - - HDFC Bank Ltd. - - - 1.68 - - - - - -Other Income - HDFC Bank Ltd. - - 44.64 29.54 - - - - - -EXPENDITURE/ TRANSACTIONInterest - HDFC ERGO General Insurance Co. Ltd. 7.99 - - - - - - - - - - HDFC Standard Life Insurance Co. Ltd. 37.59 22.46 - - - - - - - - - HDFC Holdings Ltd. - 13.47 - - - - - - - - - HDFC Investment Ltd. - 5.17 - - - - - - - -Bank & Other Charges - HDFC Bank Ltd. - - 1.49 1.53 - - - - - -Remuneration - Mr. Keki M. Mistry - - - - - - 6.67 5.52 - - - Ms. Renu S. Karnad - - - - - - 6.20 5.15 - - - Mr. V. S. Rangan - - - - - - 3.85 2.69 - -Other Expenses - HDFC Sales Private Ltd. 119.97 92.67 - - - - - - - - - HDFC Bank Ltd. - - 138.16 105.26 - - - - - -ASSETSInvestments - HDFC Bank Ltd. - - 5,549.74 5,549.74 - - - - - - - HDFC Standard Life Insurance Co. Ltd. 1,545.64 1,545.64 - - - - - - - -Loans - GRUH Finance Ltd. 13.27 - - - - - - - - - - Ms. Renu S. Karnad - - - - - - - 0.12 - - - Mr. V. S. Rangan - - - - - - - 0.07 - -Corporate Deposits - HDFC Sales Private Ltd. 7.00 26.10 - - - - - - - - - RuralShores Business Services Pvt. Ltd. - - 3.00 - - - - - - -Bank Balance and Deposits - HDFC Bank Ltd. - - 821.68 1,439.29 - - - - - -Trade Receivable - HDFC Standard Life Insurance Co. Ltd. 0.01 0.01 - - - - - - - -

�� (Continued)

105


` in Crores

Particulars


AssociatesEntities over which control is exercised



PersonnelCurrent

YearPrevious

YearCurrent

YearPrevious

YearCurrent

YearPrevious

YearCurrent

YearPrevious

YearCurrent

YearPrevious

YearOthers - HDFC ERGO General Insurance Co. Ltd. 1.44 - - - - - - - - - - HDFC Standard Life Insurance Co. Ltd. 7.60 7.55 - - - - - - - - - HDFC Bank Ltd. - - 2.19 8.87 - - - - - -LIABILITIESDeposits - HDFC Holdings Ltd. 21.03 140.47 - - - - - - - - - HDFC Investment Ltd. - 107.15 - - - - - - - - - Mr. Keki M. Mistry - - - - - - 3.28 3.85 - -Non-Convertible Debentures - HDFC ERGO General Insurance Co. Ltd. 105.00 55.00 - - - - - - - - - HDFC Standard Life Insurance Co. Ltd. 615.00 550.00 - - - - - - - -Others - HDFC ERGO General Insurance Co. Ltd. 4.72 1.79 - - - - - - - - - HDFC Standard Life Insurance Co. Ltd. 22.52 19.41 - - - - - - - -

36. SEGMENT REPORTING

��K��m��%�� houses, commercial real estate and certain other purposes in India. All other activities of the Corporation revolve around the main business. As such, there are no separate reportable segments, as per the Accounting +��+%��>��%m�=�+�:/@&��K��=��%�+��@�>��&�Q;;�!

37. INTEREST IN JOINT VENTURES

*�� %� +�� %� �� '�� >��%� �� *�� m�=�+�Q/@&��K��=��%�+��@�>��&�Q;;�&��K��%��&��*��!

Names of Companies

HDFC Standard Life Insurance Co. Ltd.

HDFC ERGO General Insurance Co. Ltd.


Percentage of Shareholding 72.37 72.37 73.91 74.00

Amount of Interest based on the last Audited Accounts

Assets 30,390.96 24,455.06 2,412.81 1,761.86

Liabilities 29,405.80 23,836.16 1,883.28 1,368.58

Income 10,059.54 7,579.94 1,075.73 778.38

Expenditure 9,729.73 7,383.81 941.28 807.75

Capital Commitment 274.66 141.07 5.10 6.61

Contingent Liability 245.45 157.20 - -

38.� ��m��%��%��~��m��~��!

�� (Continued)

106

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ConsolidatedFinancial Statements

Independent Auditors’ Report

Balance Sheet

Statement of Profit and Loss

Cash Flow Statement

Notes to Consolidated Financial Statements

HOMEWARD BOUND

108

Independent Auditors’ ReportCONSOLIDATED FINANCIAL STATEMENTS

TO THE BOARD OF DIRECTORS OF

HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED

Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether �� are free from material misstatement.

An audit involves per forming procedures to obtain audit evidence about the amounts and the disclosures in the consolidated f inancial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the �� whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Corporation’s preparation and presentation of the consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of ��

We believe that the audit evidence �� appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the

Report on the Consolidated Financial Statements

We have audited the accompanying �� HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED (“the Corporation”), and its subsidiaries (the Corporation and its subsidiaries constitute “the Group”), which comprise the Consolidated Balance Sheet as at March 31, 2013, the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the year then ended, and a summary of the �� other explanatory information.

Management’s Responsibility for the Consolidated Financial Statements

The Corporation’s Management is responsible for the preparation of these consolidated financial statements that give a true and fair �� position, consolidated financial performance and consolidated cash �� the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these consolidated �� audit. We conducted our audit in accordance with the Standards on

109

THIRTY SIXTH ANNUAL REPORT 2012-13CONSOLIDATED FINANCIAL STATEMENTS

explanations given to us, and based on the consideration of the reports �� statements of the subsidiaries and associates referred to below in the Other Matter paragraph, the aforesaid consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Consolidated Balance Sheet, of the state of affairs of the Group as at March 31, 2013;

(b) in the case of the Consolidated �� on that date; and

(c) in the case of the Consolidated Cash Flow Statement, of the cash �� on that date.

Other Matter

We did not audit the financial statements of four subsidiaries, �� total assets (net) of ` 1,279.68 crores as at March 31, 2013, total revenues of ` 1,471.49 crores and net cash out flows amounting to

` 161.63 crores for the year ended on that date, as considered in the �� !�� also include the Group’s share of �� ` 1,515.55 crores for the year ended March 31, 2013, as considered in the consolidated financial statements, in respect �� statements have not been audited by ��!�� been audited by other auditors whose reports have been furnished to us by the Management and our opinion, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries and associates, is based solely on the reports of the other auditors.

"��#� ��of this matter.




110

Consolidated Balance Sheet as at March 31, 2013Housing Development Finance Corporation Limited

Note` in Crores ` in Crores


EQUITY AND LIABILITIES SHAREHOLDERS’ FUNDSShare Capital 4 309.27 295.39 Reserves and Surplus 5 31,751.08 23,920.64

32,060.35 24,216.03 MINORITY INTEREST 1,071.47 819.53 NON-CURRENT LIABILITIESPolicy Liabilities (Policyholder’s Fund) 6 35,086.09 28,101.94 Long-term borrowings 7 93,618.53 77,447.47 Other Long-term liabilities 8 1,710.92 1,266.12 Long-term provisions 9 1,872.48 1,697.50

132,288.02 108,513.03 CURRENT LIABILITIESShort-term borrowings 10 18,929.26 21,132.87 Trade Payables 11 2,203.19 1,811.44 Other current liabilities 12- Policy Liabilities (Policyholder’s Fund) 6 4,238.40 3,583.60 - Borrowings 51,114.90 43,898.86 - Others 6,415.41 4,672.64 Short-term provisions 13 3,627.23 3,748.02

86,528.39 78,847.43 2,51,948.23 2,12,396.02

ASSETS NON-CURRENT ASSETS:Fixed assets(i) Tangible assets 14 611.11 611.91 (ii) Intangible assets 15 54.39 52.43 (iii) Capital work in Progress 32.43 6.33 (iv) Intangible assets under Development 0.03 0.24 GOODWILL ON CONSOLIDATION 185.08 177.53 Non-current investments 16 53,616.24 43,355.43 Deferred tax asset (net) 17 659.60 654.35 Long-term loans and advances 18- Loans 157,399.33 1,29,738.35 - Others 2,135.94 2,735.85 Other non-current assets 19 1,014.69 1,674.41

2,15,708.84 1,79,006.83 CURRENT ASSETS:Current investments 20 5,876.18 5,283.42 Trade receivables 21 216.02 632.63 Cash and bank balances 22 7,071.67 6,481.36 Short-term loans and advances 23- Loans 18,418.46 15,196.03 - Others 3,333.97 5,253.45Other current assets 24 1,323.09 482.17

36,239.39 33,329.06 DEFICIT IN THE REVENUE ACCOUNT (Policyholder’s Account) - 60.13

2,51,948.23 2,12,396.02 ��






111


�� !��"�� $ � �� '��+:;<=:+Housing Development Finance Corporation Limited

Note` in Crores


INCOMERevenue from Operations 26 22,032.46 18,223.92 �� $�� 27 378.35 299.46 Other Income 26.4 38.75 27.08 Premium from Insurance Business 12,650.29 11,155.57 Other Operating Income from Insurance Business 887.08 596.83 Total Revenue 35,986.93 30,302.86

EXPENSESFinance Cost 28 14,295.52 11,551.92 %��'��%*�� 29 528.13 445.47 Establishment Expenses 30 125.54 90.38 Other Expenses 31 429.97 273.32 Claims paid pertaining to Insurance Business 5,221.28 3,797.72 Commission and operating expenses pertaining to Insurance Business 2,278.56 2,093.77 Other expenses pertaining to Insurance Business 32 5,437.86 5,695.61 Depreciation and Amortisation 14 & 15 54.20 50.64 Provision for Contingencies 5.3 & 33 148.59 87.30

28,519.65 24,086.13

PROFIT BEFORE TAX 7,467.28 6,216.73 Tax Expense Current Tax 2,007.28 1,737.00 Deferred Tax 17 (5.25) (10.04)PROFIT FOR THE YEAR 5,465.25 4,489.77

�� +��$�� (341.80) (207.78)/�� <�� 1,516.27 1,180.52 PROFIT AFTER TAX ATTRIBUTABLE TO THE GROUP 5.1 6,639.72 5,462.51

EARNINGS PER SHARE (Face Value ` 2) 36 Basic (`) 43.63 37.07 Diluted (`) 43.09 36.50

��






112

Consolidated Cash Flow Statement for the year ended March 31, 2013Housing Development Finance Corporation Limited






Notes ` in CroresPrevious Year

` in CroresA CASH FLOW FROM OPERATING ACTIVITIES

��<�� *�<�� 6,639.72 5,462.51 Add: Provision for Taxation 2,002.03 1,726.96 ��'��! * 8,641.75 7,189.47 Adjustments for:Depreciation and Amortisation * 14 & 15 101.33 96.21 Provision for Contingencies 5.5 148.59 87.30 Interest Expense 28 14,033.19 11,160.70 Net (Gain)/Loss on translation of foreign currency monetary assets and liabilities 28.2 (52.01) (22.25)Interest Income 26 (20,523.01) (16,649.20)Employee Stock Option Expense (net of options exercised) (4.54) (1.99)Premium paid on redemption of Debentures (708.71) (619.71)Shelter Assistance Reserve - utilisation 5 (9.82) (7.18)Reserve for Unexpired Risk 228.96 294.40 Policy Liabilities (net) 7,699.08 5,439.64 Surplus from Deployment in Cash Management Schemes of Mutual Funds (256.74) (335.62)�� $�� (378.35) (299.46)Dividend Income (68.30) (51.88)Provision for Diminution in Value of Investments 6.22 (5.59)Bad debts written off 3.37 1.39 ?��@J�� Q�*��<��?��@ (0.57) 1.72 "�� X��Z��[ �� 8,860.44 6,277.95 Adjustments for:Current and Non Current Assets 2,293.15 (3,030.35)Current and Non Current Liabilities 316.95 1,321.19 Cash generated from operations 11,470.54 4,568.79 Interest Received 20,191.55 16,246.15 Interest Paid (12,125.73) (9,918.44)Dividend Received 68.30 51.88 Taxes Paid (2,493.30) (2,318.63)Net cash from operation 17,111.36 8,629.75 Loans disbursed (net) (30,693.83) (24,740.65)Corporate Deposits (net) 1,647.97 (1,423.44)Net cash used in operating activities [ A ] (11,934.50) (17,534.34)* Includes depreciation included under Other expenses pertaining to Insurance Business

B CASH FLOW FROM INVESTING ACTIVITIESPurchase of Fixed Assets (172.30) (149.84)Sale of Fixed Assets 46.91 16.59 Goodwill (net) (7.55) - Investments (net) (10,085.68) (6,149.48)Net cash used in investing activities [ B ] (10,218.62) (6,282.73)

C CASH FLOW FROM FINANCING ACTIVITIESShare Capital - Equity 4.1 13.88 2.02 Shares Bought Back by one of the Subsidiary Company (48.65) (48.76)Securities Premium 5 3,863.34 333.88 Borrowings (net) 21,015.11 24,329.94 Dividend paid (1,635.56) (1,322.27)Tax paid on Dividend (294.09) (240.83)Securities Issue Expenses (18.69) (27.37)Expenses on Buy Back of equity shares by a Subsidiary Company - (0.10)Increase in Minority Interest 245.94 167.42 � �� [ C ] 23,141.28 23,193.93 Net (Decrease)/Increase in cash and cash equivalents [A+B+C] 988.16 (623.14)Add: Cash and cash equivalents as at the beginning of the year 22 3,405.11 4,020.15 Add: Exchange difference on bank balance 4.19 8.10 Cash and cash equivalents as at the end of the year 22 4,397.46 3,405.11 Earmarked balances with banks:- Unclaimed dividend account 12.38 10.31 - Other against Foreign Currency Loans 5.42 4.76 - Others 2.68 2.67 Short-term bank deposits 2,653.73 3,058.51 Cash and Bank balances at the end of the year 22 7,071.67 6,481.36

��

113


��

1. SIGNIFICANT ACCOUNTING POLICIES

1.1 ACCOUNTING CONVENTION

These accounts have been prepared in accordance with historical cost convention, except for revaluation of $�� <�� [�� (Accounting Standards) Rules, 2006 and relevant provisions of the Companies Act, 1956. The accounting policies ��

� !�� #�� + � �� Z�� considered in the reported amounts of assets and liabilities (including contingent liabilities) as of the date of �� *�� + � �� Q��results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known/materialise.

1.2 GAIN OR LOSS ON DILUTION

The gain or loss on account of dilution of stake of HDFC Ltd. in its subsidiaries, associates and entities over which control is exercised is accounted through Respective Reserves.

1.3 SYSTEM OF ACCOUNTING

The Group adopts the accrual concept in the preparation of the accounts.

� !��' �� provisions contained in Section 211 of the Companies Act, 1956, read with Revised Schedule VI thereto to the extent possible (except the insurance subsidiaries).

1.4 INFLATION

� <�� !�� \��changing value in the purchasing power of money.

1.5 OPERATING CYCLE

Based on the nature of its activities, the Corporation has determined its operating cycle as 12 months for the �� ]��

1.6 CASH FLOW STATEMENT

� [ �� J?�@��*�� *�is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future � �� !�� segregated based on the available information.

1.7 CASH AND CASH EQUIVALENTS (FOR PURPOSES OF CASH FLOW STATEMENT)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that �� Z�� \�� Z�� value.

1.8 INTEREST ON HOUSING LOANS

Repayment of housing loans is generally by way of Equated Monthly Instalments (EMIs) comprising principal and interest. EMIs commence once the entire loan is disbursed. Pending commencement of EMIs, pre-EMI interest is payable every month. Interest on loans is computed either on an annual rest or on a monthly rest basis.

114

�� (Continued)

1.9 PREMIUM INCOME FROM INSURANCE BUSINESS

LIFE INSURANCE BUSINESS

Premium Income

Premium income is recognised when due from Policyholders, if there is no uncertainty of collectability. In case of linked business, premium income is recognised when the associated units are created. Premium on lapsed policies is recognised as income when such policies are reinstated. Top up premium is considered as single premium.

Income from Linked Policies

Income from linked policies, which include fund management charges, policy administration charges, mortality charges and other charges, wherever applicable, is recovered from the linked funds in accordance with the terms and conditions of the insurance contracts and is recognised as income when due.

Reinsurance Premium Ceded

Reinsurance premium ceded is recognised on due basis in accordance with the arrangement agreed in the reinsurance treaties.

GENERAL INSURANCE BUSINESS

Premium Income

Premium (net of service tax) is recognised as income over the contract period or period of risk, as appropriate, after adjusting for unearned premium (unexpired risk). Any subsequent revisions to or cancellations of premiums are accounted for in the year in which they occur. Installment cases are recorded on installment due dates. Premium received in advance represents premium received prior to commencement of the risk.

Reinsurance Premium Ceded

Reinsurance premium ceded is accounted in the year in which the risk commences and over the period of risk in accordance with the treaty arrangements with the reinsurers. Reinsurance premium ceded on unearned premium is carried forward to the period of risk and is set off against related unearned premium. Any subsequent revisions to or cancellations of premiums are accounted for in the year in which they occur.

Premium on excess of loss reinsurance cover is accounted as per the terms of the reinsurance arrangements.

1.10 INCOME FROM LEASES

Lease rental income in respect of leases is recognised in accordance with the Accounting Standard on ‘Leases’ ?<��^_@��[�� ?<�� @�`��z{{|�

1.11 INCOME FROM INVESTMENTS

The gain/loss on account of Investments in Preference Shares, Debentures/Bonds and Government Securities held as long-term investments and acquired at a discount/premium, is recognised over the life of the security on a pro-rata basis. Interest Income is accounted on accrual basis. Dividend income is accounted when the right to receive is established.

1.12 BROKERAGE ON DEPOSITS

Brokerage, other than incentive brokerage, are amortised over the period of the deposit except in respect of brokerage paid by one of the subsidiary companies. Incentive brokerage, which is payable to agents who ��

1.13 TRANSLATION OF FOREIGN CURRENCY

Initial recognition

Transactions in foreign currencies entered into by the Group are accounted at the exchange rates prevailing on the date of the transaction.

115


�� (Continued)

Measurement at the Balance Sheet date

Assets and liabilities in foreign currencies are converted at the rates of exchange prevailing at the year-end, where not covered by forward contracts. Wherever the Corporation has entered into a forward contract or an instrument that is, in substance, a forward exchange contract, the difference between the forward rate and the exchange rate on the date of the transaction is recognised as income or expense over the life of the contract.

Cross currency interest rate swaps are recorded by marking the foreign currency component to spot rate.

The net loss/gain on translation of long-term monetary assets and liabilities in foreign currencies is amortised �� Loss. The unamortised exchange difference is carried in the Balance Sheet as “Foreign currency monetary item translation difference account”. The net loss/gain on translation of short-term monetary assets and liabilities ��

1.14 INVESTMENTS

(i) OTHER THAN INSURANCE COMPANIES

� � $�� Z�� two categories, viz. Current or Long Term. ‘Long term investments (excluding investment properties), are carried individually at cost less provision for diminution, other than temporary, in the value of such investments. Current investments are carried individually, at the lower of cost and fair value.Provision for diminution in the value of investments is made in accordance with the guidelines issued by the National Housing Bank and the Accounting Standard on ‘Accounting for Investments’ (AS 13) ��[�� ?<�� @�`��z{{|�� for Contingencies Account. Investment properties are carried individually at cost less accumulated depreciation and impairment, if any.

(ii) INSURANCE COMPANIES

Investments are made in accordance with the Insurance Act, 1938, the Insurance Regulatory and Development Authority (Investment) Regulations, 2000, the Insurance Regulatory and Development <��?$��@�?<��@�`�� z{{^� �� J�� by the Insurance Regulatory and Development Authority in this context from time to time.

Investments are recorded at cost, which include brokerage, stamp duty and excludes broken period interest. Investments maturing within twelve months from the balance sheet date and investment made with the �� ]��$�� ]��

In case of one of the subsidiary company (HDFC Standard Life Insurance Co. Ltd.), Investment property represents land or building held for use other than in services or for administrative purposes. The investment in the real estate investment property is valued at historical cost plus revaluation if any. Revaluation of the investment property is done atleast once in three years. The change in the carrying amount of the investment property is taken to Revaluation Reserve.

1.15 TANGIBLE FIXED ASSETS

Fixed Assets are capitalised at cost inclusive of legal and/or installation expenses. Leased Assets are accounted �� <�� ~�� ?<�� ^_@� �� [�� ?<��Standards) Rules, 2006.

1.16 INTANGIBLE ASSETS

Intangible Assets comprising of system software are stated at cost of acquisition, including any cost attributable for bringing the same to its working condition, less accumulated amortisation and Goodwill arising on account

116

of a scheme of amalgamation in a subsidiary company and a scheme of de-merger in a jointly controlled entity. Any expenses on such software for support and maintenance payable annually are charged to the Statement ��

1.17 DEPRECIATION AND AMORTISATION

Tangible Fixed Assets

Depreciation on all Fixed Assets other than Leased Assets and Leasehold Improvements, is provided for the full year in respect of assets acquired during the year. No depreciation is provided in the year of sale.

In respect of Leased Assets and Leasehold Improvements depreciation is provided on a pro-rata basis from the date of installation/acquisition.

Depreciation on Buildings, Computers, Leased Assets and Leasehold Improvements, is calculated as per the straight-line method; and on other assets as per the reducing balance method. All assets except Computers �� <�� [�� <��^_�|�� [�� z�� ]�� 205(5)(a) of the Companies Act, 1956, whichever is shorter. Depreciation in respect of Leasehold Improvements is provided on the straight-line method over the primary period of the lease.

In respect of jointly controlled entity, Fixed assets that are to be used exclusively for customers and over which they have a lien are depreciated over the shorter of the estimated useful life or the tenure of contract. Fixed assets acquired on hire purchase basis are amortised over the tenure of the agreement. Leasehold Improvements are amortised over the period of lease or ten years whichever is shorter.

Intangible Assets

Capitalised software is amortised over a period of four years on a straight-line basis. Goodwill arising on account of a scheme of amalgamation in a subsidiary company and a scheme of de-merger in a jointly controlled entity has been amortised on a straight-line basis over a period of 20 years and 10 years respectively.

1.18 PROVISIONS AND CONTINGENCIES

A provision is recognised when the Group has a present obligation as a result of past events and it is probable �� #�� ?�*�� @� �� determined based on the best estimate required to settle the obligation at the balance sheet date. These are �� \�� [�� /��[��

1.19 PROVISION FOR CONTINGENCIES AND NON-PERFORMING ASSETS

The Group’s policy is to carry adequate amounts in the Provision for Non-Performing Assets Account and the Provision for Contingencies account to cover the amount outstanding in respect of all non-performing assets and standard assets respectively as also all other contingencies. All loans and other credit exposures where the �� /�� ]�� the prudential norms prescribed by the National Housing Bank and the Reserve Bank of India. The provision for non-performing assets is deducted from loans and advances. The provisioning policy of the Corporation covers the minimum provisioning required as per the NHB and the Reserve Bank of India.


Z ��

� !��[��

�� (Continued)

117


plans and are charged as an expense based on the amount of contribution required to be made. These funds and the schemes thereunder are recognised by the Income-tax authorities and administered by various trustees.The Rules of the Corporation’s Provident Fund administered by a Trust require that if the Board of Trustees are unable to pay interest at the rate declared for Employees’ Provident Fund by the Government under para 60 of the Employees’ Provident Fund Scheme, 1952 for the reason that the return on investment is less or �� [��

Z ��

� Q�� \��[�� being carried out at each balance sheet date. Actuarial gains and losses are recognised in the Statement of �� *�� ]�� !�� ' �� \�� the fair value of scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the schemes.

Except in case of Dubai branch of the Corporation, the provision for gratuity is made in accordance with the prevalent local laws.

��_� �� $ � � ��

!�� ]��*�� *�� !��include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related service.

The cost of short-term compensated absences is accounted as under:

(a) in case of accumulated compensated absences, when employees render the services that increase their entitlement of future compensated absences; and

(b) in case of non-accumulating compensated absences, when the absences occur.

"��_� �� $ � � ��

Compensated absences which are not expected to occur within twelve months after the end of the period in ��

1.21 CLAIMS PAID AND OTHER EXPENSES PERTAINING TO INSURANCE BUSINESS

(i) LIFE INSURANCE BUSINESS

� � [ �� <�� when due. Surrenders under conventional policies are accounted on consent from the insured to the court provided by the Company. Surrenders and withdrawals under linked policies are accounted on the receipt of intimation. Surrenders also include amounts payable on lapsed policies which is accounted for on the date of lapse. Surrenders and lapsation are disclosed at net of charges recoverable. Reinsurance claims are accounted for in the period in which the claims are settled.

Policy acquisition costs are expensed in the period in which they are incurred. Acquisition costs consists of commission to insurance intermediaries, sales staff costs, rent, medical cost, policy printing expenses,

�� (Continued)

118

� �� *�� [ �� Z�� year commission is recognised in the year in which it is decided that it has become recoverable.

(ii) GENERAL INSURANCE BUSINESS

Claims incurred comprises of claims paid (net of salvage and other recoveries), change in the estimate liability for outstanding claims made following a loss occurrence reported, change in estimated liability for claims incurred but not reported (IBNR) & claims incurred but not enough reported (IBMER) and �� *��

Provision is made for estimated value of outstanding claims at the balance sheet date net of reinsurance, salvage and other recoveries. Such provision is made on the basis of the ultimate amounts that are likely to be paid on each claim, established by the management in the light of past experience and �� insurance claim settlement costs likely to be incurred to settle outstanding claims.

Claims (net of amounts receivable from reinsurers/coinsurers) are recognised on the date of intimation based on estimates from surveyors/insured in the respective revenue accounts.

The estimated liability for claims incurred but not reported (IBNR) and claims incurred but not enough reported (IBNER) has been estimated by the Appointed Actuary in compliance with guidelines issued by IRDA vide circular No. 11/IRDA/ACTL/IBNR/2005-06 dated June 8, 2005 and applicable provisions of the Guidance Note 21 issued by the Institute of Actuaries of India. The Appointed Actuary has used alternative methods for each product category as considered appropriate depending upon the availability of past data as well as appropriateness of the different methods to the different lines of businesses.

The Basic Chain Ladder (BCL) method has been adopted for those lines of business where claims development from the past years is considered to be representative for the future claims development viz. Motor (OD and PA), Personal Accident, Health and Travel Insurance.

The Bornhuetter – Fergusson method has been adopted for Motor Third Party Insurance in respect of classes of vehicles other than commercial vehicles since reasonable volume of paid claims data is � � ��$�� loss experience and/or minimum reliable development data is not available to justify the application of standard actuarial methods.

For other classes of business such as Commercial Insurance (consisting of Fire, Marine, Engineering, Public Liability, Product Liability, Workmen compensation and Miscellaneous), Specialty Insurance, Cattle ��$�� any statistical method. For such classes of business, the liability has been arrived at by using Loss Ratio method by multiplying the Net Earned premium and the excess if the estimated claims ratio over the actual claims ratio.

� � <�#�� #��and renewal insurance contracts viz. commission. These costs are expensed out in the period in which they are incurred.

1.22 EARNINGS PER SHARE

� ' �� J?�@� �� *� ?�� *��extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. �� J?�@� �� *�?�� *��extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of

�� (Continued)

119


equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares.

Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease �� #�� be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented. The number of equity shares and potentially dilutive equity shares are adjusted for share splits/reverse share splits and bonus shares, as appropriate.

1.23 INCOME-TAX

Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted as at the reporting date. Deferred tax assets are recognised for timing differences of items other than unabsorbed �� *�� *�� taxable income will be available against which these can be realised. However, if there are unabsorbed depreciation and carry forward of losses, deferred tax assets are recognised only if there is virtual certainty �� * ��

Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each balance sheet date for their realisability.

Current and deferred tax relating to items directly recognised in reserves are recognised in reserves and not ��

1.24 SERVICE TAX INPUT CREDIT

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is no uncertainty in availing/utilising the credits.

1.25 SECURITISED ASSETS

Derecognition of securitised assets in the books of the Corporation, recognition of gain or loss arising on securitisation and accounting for credit enhancement provided by the Corporation is based on the Guidance Note on Accounting for Securitisation issued by the Institute of Chartered Accountants of India.

Securitised assets are derecognised in the books of the Corporation based on the principle of surrender of control over the assets. Credit Enhancement provided by the Corporation by way of investments in subordinate [ �'�� !��[�� $�� !��[�� /��/��^|��

1.26 POLICY LIABILITIES

Actuarial liabilities (for all inforce policies as at the valuation date) are calculated in accordance with accepted �� #��$�� <��^_�� $`�<� �� /��issued by the Institute of Actuaries of India with the concurrence of the IRDA.

The liability for individual non-linked business and non unit reserves of unit linked business is calculated at the valuation date using gross premium method. The liabilities are determined based on assumptions as to the future experience of the policies. The principal assumptions are related to interest, expenses, persistency,

�� (Continued)

120

mortality and in case of participating policies, bonuses and taxes. The assumptions made are based on prudent estimates of the future experience, and hence include margins for adverse deviations.

The unit reserve in respect of linked business is determined on the basis of net asset values of the units allocated to the Policyholders as at the valuation date.

The liability for the one year renewable group term policies is calculated on the unexpired risk premium basis, and for the group non linked savings products on the basis of policy account balances.

1.27 PRELIMINARY EXPENSES

Preliminary Expenses are being written off over a period of 5 years in accordance with the provisions of Section 35D of the Income-tax Act, 1961.

2.� !�� Finance Corporation Limited (“HDFC Ltd.” or “the Corporation”), its subsidiaries and associates as on March �^��z{^�� !�� the following basis:

� �� !�� [�� ]��]��basis by consolidating the book values of like items of assets, liabilities, income and expenses, after eliminating intra-group balances and� �� ]�� <�� z^� �� ~[�� Q�� [�� (Accounting Standards) Rules, 2006.

� �� !��[�� #�� #�� ] �#�� J�� J� �� value of investments in accordance with the Accounting Standard 23 on ‘Accounting for Investments ��<�� [�� Q�� [�� ?<�� @�Rules, 2006.

� �� !�� to the same reporting date as that of the Corporation, i.e. March 31, 2013.

� �� !��*��[�� [�� #��

� �� !��*�� [�� #�� #�� cost of investment is treated as Capital Reserve.

� �� +��$��

a) T he amount of equity attributable to minorities at the date on which investment in a subsidiary

is made; and

b) The minorities’ share of movements in equity since the date the relationship came into existence.

� �� +�� J�� \�� *��

� �� $�� ]�� average rate prevailing during the year. All assets and liabilities are converted at the rates prevailing at the end of the year. Any exchange difference arising on consolidation is recognised in the Foreign Currency Translation Reserve.

�� (Continued)

121


z�̂ � !�� <�� [�� Q�� ?<�� z^@� �� [�� ?<�� @�Rules, 2006.

All the below mentioned subsidiaries have been incorporated in India, other than Griha Investments which has been incorporated in Mauritius and Griha Pte. Ltd. and HDFC Asset Management Company (Singapore) Pte. Ltd. have been incorporated in Singapore.

Name of Subsidiary Proportion of Ownership Interest (%)

Current Year Previous Year

HDFC Developers Ltd. 100.00 100.00

HDFC Investments Ltd. 100.00 100.00

HDFC Holdings Ltd. 100.00 100.00

HDFC Asset Management Co. Ltd. 59.81 59.98

HDFC Trustee Co. Ltd. 100.00 100.00

HDFC Realty Ltd. 100.00 100.00

GRUH Finance Ltd. 59.69 60.36

HDFC Venture Capital Ltd. 80.50 80.50

HDFC Ventures Trustee Co. Ltd. 100.00 100.00

HDFC Sales Pvt. Ltd. 100.00 100.00

HDFC Property Ventures Ltd. 100.00 100.00

HDFC Investment Trust 100.00 100.00

HDFC Property Fund – Scheme - HDFC IT Corridor Fund 100.00 97.98

Griha Investments (Subsidiary of HDFC Holdings Ltd.) 100.00 100.00

Griha Pte. Ltd., Singapore (Subsidiary of HDFC Investments Ltd.) (w.e.f. December 28, 2012)

# 100.00 -

HDFC Asset Management Company (Singapore) Pte. Ltd. (Subsidiary of HDFC Asset Management Co. Ltd.) * - 59.98

Credila Financial Services Pvt. Ltd. 62.28 62.28

HDFC Education and Development Services Pvt. Ltd. (w.e.f. November 17, 2011)

100.00 # 100.00

# Consequent to the incorporation of this subsidiary, the consolidated net worth of the current year is lower by ` 0.19 crores (Previous Year ` z��z� ��@� �� ` 0.16 crores (Previous Year ` 2.32 crores).

* HDFC Asset Management Company Ltd. is in the process of winding up HDFC Asset Management Company (Singapore) Pte. Ltd. (its subsidiary company) and the necessary steps in this regard have been initiated. Accordingly, a permanent diminution has been provided against the investment in subsidiary company and the same has not been consolidated.

z�z� <��<�� [�� Q�� ?<��z^@��[�� ?<�� @�`��z{{|�� Q[��`"�%`!��Q�/��Scheme - HDFC IT Corridor Fund, all incorporated in India, have been excluded from consolidation, since they are held exclusively with a view to their subsequent disposal in the near future.

�� (Continued)

122

Name of Subsidiary Proportion of Ownership Interest (%)


Grandeur Properties Pvt. Ltd. 100.00 97.98

Haddock Properties Pvt. Ltd. 100.00 97.98

Pentagram Properties Pvt. Ltd. 100.00 97.98

Windermere Properties Pvt. Ltd. 100.00 97.98

Winchester Properties Pvt. Ltd. 100.00 97.98

z�� !�� $�� of jointly controlled entities, have been consolidated as per Accounting Standard on Consolidated Financial �� ?<��z^@��[�� ?<�� @�`��z{{|�

Name of Subsidiary (Jointly Controlled Entity) Proportion of Ownership Interest (%)


HDFC Standard Life Insurance Co. Ltd. 72.37 72.37

HDFC Life Pension Fund Management Co. Ltd. (w.e.f. June 20, 2011)

(Subsidiary of HDFC Standard Life Insurance Co. Ltd.) 72.37 * 72.37

HDFC ERGO General Insurance Co. Ltd. 73.91 74.00

* Consequent to the incorporation of the subsidiary the consolidated networth of the current year is higher by ` Nil (Previous Year ` {�{��@� �� ` Nil (Previous Year ` 0.07 crores).

2.4 The Corporation has made an investment in H T Parekh Foundation, a Section 25 Company under Companies <��^_�|�� \��<�� !�� Z��Q�� [�� !�� Z��Q��

2.5 Consequent to the above changes in the ownership interest, certain previous year balances have been considered �� `�� ~"��<�\��

3. HDFC Ltd.’s investments in the following associates, have been accounted for, under the equity method, in accordance with the Accounting Standard 23 on ‘Accounting for Investments in Associates in Consolidated Q�� [�� ?<�� @�`��z{{|�

Name of Associate Nature of Business Proportion of Ownership Interest (%)


HDFC Bank Ltd. Banking Services 22.83 23.15

Indian Association for Savings and Credit(upto September 26, 2012)

Micro Finance - 49.99

India Value Fund Advisors Pvt. Ltd. Venture Capital 21.51 21.51

RuralShores Business Services Pvt. Ltd. BPO 34.04 35.67

IPFONLINE Ltd. (w.e.f. January 3, 2012) Publishing 28.73 28.73

�� (Continued)

123


� ��Q[�� Q[�' �Z�� statements.

4. SHARE CAPITAL

As atMarch 31, 2013

As atMarch 31, 2012

` in Crores ` in Crores

AUTHORISED162,50,00,000 Equity Shares of ` 2 each 325.00 325.00 (Previous Year 162,50,00,000 Equity Shares of ` 2 each)

325.00 325.00 ISSUED, SUBSCRIBED AND PAID-UP154,63,47,255 Equity Shares of ` 2 each 309.27 295.39 (Previous Year 147,69,70,010 Equity Shares of ` 2 each)

309.27 295.39

4.1 Reconciliation of number of shares outstanding at the beginning and at the end of the reporting period:

Particulars As at March 31, 2013 As at March 31, 2012

Number ` in Crores Number ` in Crores

Equity shares outstanding as at the beginning of the year 147,69,70,010 295.39 146,68,86,690 293.37Shares allotted pursuant to exercise of stock options 1,46,93,995 2.94 1,00,23,420 2.00Shares allotted pursuant to exchange of warrants 5,46,83,250 10.94 59,900 0.02Equity shares outstanding as at the end of the year 154,63,47,255 309.27 147,69,70,010 295.39

4.2 The details of each shareholder holding more than 5 percent shares in the Corporation:

Particulars Outstanding as on 31.3.2013 Outstanding as on 31.3.2012



Aberdeen Asset Management Asia Ltd. (on behalf of funds advised/managed) 12,74,90,319 8.24% 11,35,93,819 7.69%Life Insurance Corporation of India - - 8,25,68,977 5.59%

4.3 4,77,13,935 shares of ` 2 each (Previous Year 11,71,16,560 shares of ` 2 each) were reserved for issuance as follows:

a) 4,77,13,935 shares of ` 2 each (Previous Year 6,24,07,930 shares of ` 2 each) towards outstanding Employees Stock Options granted/available for grant, including lapsed options [Refer Note 4.4].

b) Nil shares of ` 2 each (Previous Year 5,47,08,630 shares of ` 2 each) towards outstanding share warrants [Refer Note 5.7].

The Corporation has only one class of shares referred to as equity shares having Face Value of ` 2 each. Each holder of equity share is entitled to one vote per share.

The holders of equity shares are entitled to dividends, if any, proposed by the Board of Directors and approved by Shareholders at the Annual General Meeting.

�� (Continued)

124

4.4 During the year, the Nomination and Compensation Committee of Directors (NCCD) at its meeting held on May 23, 2012 granted the 58,67,546 new stock options along with 2,34,929 options lapsed under previous Schemes i.e. ESOS-05 : 32,030 options, ESOS-07: 1,32,087 options and ESOS-08: 70,812 options, in all aggregating to 61,02,475 stock options representing 3,05,12,375 equity shares of ` 2 each at an exercise price of ` 3,177.50 per option to Employees and Directors of the Corporation under the Employees Stock Option Scheme - 2011 (ESOS-11). The said price was determined in accordance with the pricing formula approved by the shareholders i.e. at the latest available closing price of the equity shares of the Corporation on the stock exchange on which the shares are listed and having higher trading volume, prior to the meeting of the NCCD at which the options are granted.

In terms of ESOS-11, the options would vest over a period of 1-3 years from the date of grant, but not later than May 22, 2015, depending upon option grantee completing continuous service of three years with the Corporation. Accordingly, no options have vested during the current year. The options can be exercised over a ��

Under Employees Stock Option Scheme – 2008 (ESOS-08), the Corporation had on November 25, 2008, granted 57,90,000 stock options at an exercise price of ` 1,350.60 per option representing 57,90,000 equity shares of ` 10 each to the employees and directors of the Corporation. The said price was determined in accordance with the pricing formula approved by the shareholders i.e. at the latest available closing price on the stock exchange having higher trading volume, prior to grant of options.

In terms of ESOS-08, the options would vest over a period of 1-3 years from the date of grant, but not later than November 24, 2011, depending upon option grantee completing continuous service of three years with the Corporation. Accordingly, during the year Nil options (Previous Year 64,042 options) were vested and 112 options (Previous Year 581 options) were lapsed after vesting. The options can be exercised over a period of ��

Under Employees Stock Option Scheme-2007 (ESOS-07), the Corporation had on September 12, 2007, granted 54,56,835 stock options at an exercise price of ` 2,149 per option representing 54,56,835 equity shares of ` 10 each to the employees and directors of the Corporation. The said price was determined in accordance with the pricing formula approved by the shareholders i.e. at the latest available closing price on the stock exchange having higher trading volume, prior to grant of options.

In terms of ESOS - 07, the options would vest over a period of 1-3 years from the date of grant, but not later than September 11, 2010, depending upon option grantee completing continuous service of three years with the Corporation. All the options have been vested in the earlier years. In the current year 525 options (Previous �� ^�|�{��@�� !�� *�� the date of respective vesting.

Under Employees Stock Option Scheme-2005 (ESOS-05), the Corporation had on October 25, 2005, granted 74,73,621 stock options at an exercise price of ` 912.90 per option representing 74,73,621 equity shares of ` 10 each to the employees and directors of the Corporation. The said price was determined in accordance with the pricing formula approved by the shareholders i.e. at the latest available closing price on the stock exchange having higher trading volume, prior to grant of options.

In terms of the ESOS-05, the options would vest over a period of 2-3 years from the date of grant, but not later than October 24, 2008, depending upon option grantee completing continuous service of three years with the Corporation. All the options have been vested in the earlier years. In the current year 12,285 options ?�� z��@�� !�� *�� from the date of respective vesting. Accordingly, all the options vested under ESOS-05 have been exercised.

�� (Continued)

125


Method used for accounting for share based payment plan:

The Corporation has used intrinsic value method to account for the compensation cost of stock options to employees of the Corporation. Intrinsic value is the amount by which the quoted market price of the underlying share exceeds the exercise price of the option. Since the options under ESOS-11, ESOS-08, ESOS-07 and ESOS-05 were granted at the market price, the intrinsic value of the option is Nil. Consequently the accounting value of the option (compensation cost) is also Nil.

Movement in the options under ESOS-11, ESOS-08, ESOS-07 and ESOS-05:

Particulars ESOS-11



Outstanding at the beginning of the year - - Granted during the year 61,02,475 - Vested during the year - - Exercised during the year - - Lapsed during the year 31,200 - Outstanding at the end of the year 60,71,275 - Unvested at the end of the year 60,71,275 - Exercisable at the end of year - - Weighted average price per option ` 3177.50

Particulars ESOS-08



Outstanding at the beginning of the year 22,81,083 32,29,708Granted during the year - - Vested during the year - 64,042Exercised during the year 5,24,232 9,48,044Lapsed during the year 112 581Outstanding at the end of the year 17,56,739 22,81,083Unvested at the end of the year - - Exercisable at the end of year 17,56,739 22,81,083Weighted average price per option ` 1,350.60

Particulars ESOS-07



Outstanding at the beginning of the year 37,80,574 44,21,246Granted during the year - - Vested during the year - - Exercised during the year 21,09,398 6,39,042Lapsed during the year 525 1,630Outstanding at the end of the year 16,70,651 37,80,574Unvested at the end of the year - - Exercisable at the end of year 16,70,651 37,80,574Weighted average price per option ` 2,149.00

�� (Continued)

126

Particulars ESOS-05Options

Current yearOptions

Previous Year

Outstanding at the beginning of the year 3,17,454 7,35,576Granted during the year - - Vested during the year - - Exercised during the year 3,05,169 4,17,598Lapsed during the year 12,285 524Outstanding at the end of the year - 3,17,454Unvested at the end of the year - - Exercisable at the end of year - 3,17,454Weighted average price per option ` 912.90

With effect from August 21, 2010, the nominal face value of equity shares of the Corporation was sub-divided from ` 10 per share to ` 2 per share. Accordingly, each option exercised after August 21, 2010 is entitled to 5 equity shares of ` 2 each.

Fair Value Methodology:

The fair value of options have been estimated on the date of grant using Black-Scholes model as under:

The key assumptions used in Black-Scholes model for calculating fair value under ESOS-2011, ESOS-2008, ESOS-2007 and ESOS-2005 as on the date of grant viz. May 23, 2012, November 25, 2008, September 12, 2007 and October 25, 2005, are as follows :

Particulars ESOS-2011 ESOS-2008 ESOS-2007 ESOS-2005

Risk-free interest rate (p.a.) 8.06% 6.94% 7.70% 6.38%Expected life Upto 2 years Upto 2 years Upto 2 years 2 to 3 yearsExpected volatility of share price 15% 29% 19% 30%Expected growth in dividend (p.a.) 20% 20% 20% 20%The weighted average fair value, as on the date of grant (per Stock Option) ` 474.56 ` 238.79 ` 307.28 ` 105.50

Since all the stock options granted under ESOS-2008, ESOS-2007 and ESOS-2005 have been vested, the stock based compensation expense determined under fair value based method is ` Nil (Previous Year ` Nil). <�� ' �� %��

However, had the compensation cost for the stock options granted under ESOS-11 been determined based �� [�� proforma amounts indicated below:

` in Crores


/��? ��@ 6,639.72 5,462.51 Less: Stock-based compensation expenses determined under fair value based method, net of tax: [Gross ` 233.78 crores (Previous Year ` Nil)] (pro forma) 157.93 - /��?�� @ 6,481.79 5,462.51 Less: Amounts utilised out of Shelter Assistance Reserve 9.13 6.89 Less: Proportionate share of amounts utilised out of Corporate Social Responsibility Fund of HDFC Asset Management Company Limited 0.69 0.29 /��%��?�� @ 6,471.97 5,455.33

�� (Continued)

127


Amount in `


Basic earning per share (as reported) 43.63 37.07

Basic earning per share (pro forma) 42.59 37.07

Diluted earning per share (as reported) 43.09 36.50

Diluted earning per share (pro forma) 42.06 36.50

5. RESERVES AND SURPLUS


` in Crores


` in Crores

SPECIAL RESERVE No. I [Refer Note 5.2] 51.23 51.23

SPECIAL RESERVE No. II [Refer Note 5.2] 5,635.91 4,839.90

SPECIAL RESERVE Under Section 45-IC(1) of the RBI Act, 1934 26.73 20.97

GENERAL RESERVE 9,073.00 7,940.87

ADDITIONAL RESERVE (Under Section 29C of the National Housing Bank Act, 1987) [Refer Note 5.3] 2,290.87 1,458.51

REVALUATION RESERVE [Refer Note 5.4] 39.28 39.60

SECURITIES PREMIUM [Refer Note 5.5] 9,774.02 6,066.66

EMPLOYEE STOCK OPTION OUTSTANDING - 4.54

CAPITAL REDEMPTION RESERVE [Refer Note 5.6] 27.02 26.84

SHELTER ASSISTANCE RESERVE 53.63 22.76

CORPORATE SOCIAL RESPONSIBILITY FUND 2.01 2.70

FOREIGN CURRENCY TRANSLATION RESERVE (0.05) (1.27)

CAPITAL RESERVE [Refer Note 5.7] 0.04 301.27

CAPITAL RESERVE ON CONSOLIDATION 48.30 48.30

SURPLUS IN THE STATEMENT OF PROFIT AND LOSS (of subsidiaries and associates) [Refer Note 5.1] 4,729.09 3,097.76

31,751.08 23,920.64

5.1 SURPLUS IN THE STATEMENT OF PROFIT AND LOSS


` in Crores


` in Crores

Opening Balance 3,097.76 2,209.53

Add: Opening Adjustment [Refer Note 2.5] (0.91) (314.64)

3,096.85 1,894.89

<�� ! *�� [�� 6,639.72 5,462.51

9,736.57 7,357.40

�� (Continued)

128


` in Crores


` in Crores

APPROPRIATIONS:

Special Reserve No. II [Refer Note 5.2] 797.09 747.07

Special Reserve (under Section 45-IC(1) of the Reserve Bank of India Act, 1934) 5.76 7.05

General Reserve 996.05 906.66

Additional Reserve (under Section 29C of the National Housing Bank Act, 1987) [Refer Note 5.3] 832.46 624.57

Shelter Assistance Reserve 40.00 17.99

Capital Redemption Reserve [Refer Note 5.6] 32.84 34.55

Proposed Dividend [Dividend @ ` 12.50 per equity shares of ` 2 each (Previous Year @ ` 11 per equity shares of ` 2 each)]

1,932.93 1,624.67

Additional Tax on Dividend 379.89 298.46

Additional Tax on Dividend F.Y. 2011-12 [Refer Note 5.8] (24.62) (4.66)

Dividend [including tax of ` 2.12 crores (Previous Year ` 0.45 crores)] 15.08 3.28

pertaining to previous year paid during the year [Refer Note 5.9]

4,729.09 3,097.76

5.2 Special Reserve has been created over the years in terms of Section 36(1)(viii) of the Income-tax Act, 1961 �� Q[�� `��/�� $� �� transferred upto Financial Year 1996-97, whereas Special Reserve No. II relates to the amounts transferred thereafter.

5.3 During the year, in addition to the charge of ` 148.59 crores (Previous Year ` 87.30 crores) to the Statement �� ` Nil (net of deferred tax of ` Nil) [(Previous Year ` 7.79 crores) (net of deferred tax ` 3.76 crores)] from General Reserve by a subsidiary company, an amount of ` Nil (net of deferred tax of ` Nil) [(Previous Year ` 349.93 crores) (net of Deferred Tax of ` 168.07 crores)], being one time charge on account of changes in the provisioning requirements by the National Housing Bank vide circulars no. NHB.HFC.DIR.3/CMD/2011 dated August 5, 2011 and NHB.HFC.DIR.4/CMD/2012 dated January 19, 2012 has been transferred from Additional Reserve created as per Section 29C of the National Housing Bank Act, 1987 by HDFC Ltd. pursuant to circular NHB(ND)/DRS/Pol-No.03/2004-05 dated August 26, 2004 as under:

` in Crores



To Provision for Contingencies Account [Refer Note 9.2] 51.77 450.73

To Provision for Non-Performing Loans [Refer Note 18.4] 39.11 160.51

To Provision for Doubtful Receivable [Refer Note 23] 51.71 -

148.59 611.24

Further an amount of ` Nil (Previous Year ` 5.94 crores) has been credited to other income on account of reversal of provision for contingencies by a subsidiary company.

5.4 The premises owned by one of the subsidiary company (HDFC Standard Life Insurance Co. Ltd.) used as an �� z{{�]{|� �$��`� �%� ��

�� (Continued)

129


� �� property for its own business purpose. Consequently, value of the property so used for own business ` Nil (Previous Year ` |��@�� *��

5.5 During the year, ` 456.73 crores (Previous Year ` 501.56 crores) has been utilised out of the Securities Premium Account in accordance with Section 78 of the Companies Act, 1956. Out of the above, ` 0.17 crores (Previous Year ` Nil) has been utilised by one of the subsidiary companies towards debenture issue expenses, ` 18.52 crores (Previous Year ` 16.39 crores) has been utilised by one of the subsidiary companies towards buy-back of equity shares, ` Nil (Previous Year ` 0.10 crores) has been utilised by one of the subsidiary companies towards share issue expenses and ` 438.04 crores (net of tax ` 175.54 crores) [(Previous Year ` 485.07 crores) (net of tax ` 223.25 crores)] has been utilised by HDFC Ltd. towards the proportionate premium payable on the redemption of Zero Coupon Secured Redeemable Non-Convertible Debentures.

5.6 HDFC Asset Management Company Limited (HDFC AMC), pursuant to the approval of its shareholders at the Extra Ordinary General Meetings and in accordance with the provisions of the Companies Act, 1956 (Act) and Private Company and Unlisted Public Limited Company (Buy-back of Securities) Rules, 1999, bought back 4,84,650 equity shares during the year (Previous Year 5,04,200 equity shares) at an aggregate value of ` 112.78 crores (Previous Year ` 109.26 crores). HDFC AMC has utilised the Securities Premium Account and Free Reserves for this purpose. A sum of ` 0.29 crores (Previous Year ` 0.30 crores) has been transferred to Capital Redemption Reserve in terms of Section 77AA of the Act.

5.7 During the year 2009-10, the Corporation had made a simultaneous issue of Zero Coupon Secured Redeemable Non-Convertible Debentures (ZCD) aggregating to ` 4,000 crores and 1,09,53,706 warrants at an issue price of ` 275 per warrant aggregating to ` 301.23 crores. Each of the warrants entitles the holder to acquire one equity share of the Corporation at an exercise price of ` 3,000 per share of face value of ` 10 each (now exercise price of ` 600 per share of face value of ` 2 each) on or before August 23, 2012. The said issue of ZCD and Warrants was made under Chapter XIII-A of the Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000. The Subscription amount received on Issue of warrants has been transferred from Capital Reserve to Securities Premium Account as the same is not refundable/adjustable in future.

5.8 Additional Tax on dividend 2011-12 credit taken, ` 24.62 crores (Previous Year ` 4.66 crores), pertains to the dividend tax paid by the subsidiary companies of the Corporation on the dividend paid to the Corporation as per Section 115(O)(1A) of the Income Tax Act, 1961.

5.9 In respect of equity shares issued pursuant to Employee Stock Option Schemes and exchange of warrants, HDFC Ltd. paid dividend of ` 12.83 crores for the year 2011-12 (` 2.74 crores for the year 2010-11) and tax on dividend of ` 2.08 crores (Previous Year ` 0.44 crores) as approved by the shareholders at the Annual General Meeting held on July 11, 2012 and GRUH Finance Ltd. paid dividend of ` 0.13 crores for the year 2011-12 (` 0.09 crores for the year 2010-11) and tax on dividend of ` 0.04 crores (Previous Year ` 0.01 crores) as approved by the shareholders at the Annual General Meeting held on June 18, 2012.

5.10 Miscellaneous Expenses under Note 31 exclude ` 9.13 crores (Previous Year ` 6.89 crores) in respect of amounts utilised out of Shelter Assistance Reserve during the year.

6. The Funds for Future Appropriations (FFA), in the participating segment amounting to ` 343.68 crores (Previous Year ` 125.10 crores) included under Policy Liabilities (Policyholder’s Fund), represents the surplus, which is not allocated to Policyholders or Shareholders as at the Balance Sheet date.

The FFA in the Unit Linked segment amounting to ` 304.89 crores (Previous Year ` 335.25 crores) included under Policy Liabilities (Policyholder’s Fund), represents surplus on the lapsed policies unlikely to be revived. This surplus is required to be held within the Policyholders’ fund till the time Policyholders are eligible for revival of their policies.

�� (Continued)

130

7. LONG-TERM BORROWINGS

` in Crores


` in Crores


` in Crores

Bonds and Debentures [Refer Note 7.7] 58,993.80 43,253.10 Term Loans : - Banks [Refer Note 7.7] 7,233.80 11,516.17 - Others [Refer Note 7.7] 3,180.08 69,407.68 2,752.43 Deposits 24,210.78 19,925.61 Others (Finance Lease) 0.07 0.16

93,618.53 77,447.47

��̂ � ��]!��'�� ]� ��

Sr. No.

Particulars

` in Crores


` in Crores


` in Crores

Long term borrowings - Secured : [Refer Note 7.2]a) Bonds and Debentures

- Bonds [Refer Note 7.7] 57.50 62.50 - Non Convertible Debentures [Refer Note 7.7] 55,426.30 39,715.60

b) Term Loans from Banks - Scheduled Banks [Refer Note 7.7] 6,534.50 10,183.17

c) Term Loans from other parties - Asian Development Bank [Refer Note 7.7] 276.75 296.61 - Kreditanstalt für Wiederaufbau [Refer Note 7.7] 10.65 20.70 - National Housing Bank [Refer Note 7.7] 2,858.54 65,164.24 2,395.98

d) Others (Finance Lease) 0.07 0.16 Total Secured 65,164.31 52,674.72 Long term borrowings - Unsecured :

a) Bonds and Debentures - Non Convertible Subordinated

Debentures [Refer Note 7.7] 3,510.00 3,475.00 b) Term Loans from Banks

- Scheduled Banks [Refer Note 7.7] 699.30 1,333.00 c) Term Loans from other parties

- Under a line from Kreditanstalt für Wiederaufbau [Refer Note 7.7] 34.14 39.14

d) Deposits [Refer Note 7.6] 24,210.78 19,925.61 Total Unsecured 28,454.22 24,772.75

93,618.53 77,447.47

7.2 All secured Long Term Borrowings are secured by

(i) Negative lien on the assets of HDFC Ltd. and GRUH Finance Ltd.

(ii) Mortgage of property of HDFC Ltd. and GRUH Finance Ltd.

�� (Continued)

131


(iii) First charge by way of hypothecation of education loan receivables of one of the subsidiary company’s underlying portfolio of education loans and related collaterals.

� ?��@� %�� arrangement.

�� z_��z{^^��+��[�� <�� Accounting Standard 11, the Corporation has exercised the option as per para 46A inserted in the Standard for all long term monetary assets and liabilities. Consequently an amount of ` 169.79 crores (without considering �� *��` 57.71 crores) [Previous Year ` 206.24 crores (without considering the future tax ��` 66.91 crores)] representing translation difference is carried forward in the foreign currency monetary items translation difference account as on March 31, 2013. This amount is to be amortised over the period of the monetary assets/liabilities.

7.4 The Corporation has availed a loan of USD 100 million from the Asian Development Bank (Loan II). In respect of tranches 1 and 2 aggregating to USD 60 million, as per the agreements with a scheduled bank, the Corporation has handed over the dollar funds to the bank overseas and has obtained rupee funds in India amounting to ` 200 crores by way of a term loan and ` 100 crores through the issue of bonds which have been subscribed by the bank.

� $�� {�� [�� Z]��]� �Z� �� $�� <�� $��of the agreements, the Corporation’s foreign exchange liability is protected.

The Corporation had availed USD 175 million under the Foreign Currency Borrowing scheme of the Reserve Bank of India (RBI) under the “approval route” in terms of the RBI Press Release No. 2008-2009/700 dated November 17, 2008, with a maturity of three years. In terms of the RBI guidelines, these borrowings have been swapped into rupees for the entire maturity by way of principal only swaps. The said loans have been fully repaid in the current year [Refer Note 12.1].

As on March 31, 2013, the Corporation has foreign currency borrowings of USD 632.96 million equivalent (Previous Year USD 875.78 million). The Corporation has undertaken currency swaps, principal only swaps, currency options and forward contracts on a notional amount of USD 286.75 million equivalent (Previous Year USD 406.76 million) to hedge the foreign currency risk. Further, interest rate swaps on a notional amount of USD 130 million equivalent (Previous Year USD 123 million) are outstanding, which have been undertaken to hedge the interest rate risk on the foreign currency borrowings. As on March 31, 2013, the Corporation’s net foreign currency exposure on borrowings net of risk management arrangements is USD Nil (Previous Year USD Nil).

As a part of asset liability management on account of the Corporation’s Adjustable Rate Home Loan product as well as to reduce the overall cost of borrowings, the Corporation has entered into interest rate swaps �� *�� ` 21,185 crores (Previous Year `� z��z^{� ��@� � �� + �� ^�� z{^�� Z�� benchmarks. In addition, the Corporation has entered into cross currency swaps of a notional amount of USD 476.45 million equivalent (Previous Year USD 588.07 million) wherein it has converted its rupee liabilities into foreign currency liabilities and the interest rate is linked to the benchmarks of respective currencies.

7.5 Monetary assets and liabilities denominated in foreign currencies net of risk management arrangement are revalued at the rate of exchange prevailing at the year end. Cross Currency Interest Rate Swaps are recorded by marking the foreign currency component to spot rates.

Forward Contracts or instruments that are in substance, Forward Exchange Contracts, the premiums on such

�� (Continued)

132

contracts are being amortised over the life of the contracts. The amount of exchange difference in respect �� *�� <��#��accounting periods is ` 29.90 crores (Previous Year ` Nil).

��|� �� z?^@� ?�@��Q�� [�� ?/�'@��z{^{�� #��<�� ]��?^@��?z@��Section 29 B of National Housing Bank Act 1987.

7.7 Terms of redemption of bonds and debentures and for repayment terms of term loans:

A) BONDS & DEBENTURES�� ?�� Z��@�

` in Crores

Bonds and Debentures - Secured


Rates of Interest

6.03% - 8% 2,820.60 800.00 - 3,620.60

(2,373.30) (1,380.60) (500.00) (4,253.90)

8.01% - 10% 20,020.70 13,425.00 9,105.00 42,550.70

(7,411.70) (7,240.00) (10,000.00) (24,651.70)

10.01% - 11.95% - 2,195.00 4,185.00 6,380.00

- (1,085.00) (5,295.00) (6,380.00)

Zero Coupon 450.00 2,320.00 - 2,770.00

(1,865.00) (2,460.00) - (4,325.00)

Variable Rate

- Linked to G Sec 116.00 12.30 34.20 162.50

(10.25) (116.75) (40.50) (167.50)

TOTAL SECURED A 23,407.30 18,752.30 13,324.20 55,483.80

A (11,660.25) (12,282.35) (15,835.50) (39,778.10)

Bonds and Debentures - Unsecured


Rates of Interest

7.62% - 10% 500.00 475.00 2,535.00 3,510.00

- (975.00) (2,500.00) (3,475.00)

TOTAL UNSECURED B 500.00 475.00 2,535.00 3,510.00

B - (975.00) (2,500.00) (3,475.00)

TOTAL (SECURED & UNSECURED) A + B 23,907.30 19,227.30 15,859.20 58,993.80

A + B (11,660.25) (13,257.35) (18,335.50) (43,253.10)

�� (Continued)

133


B) TERM LOANS FROM BANKS�� ?�� Z��@�

` in Crores

Term Loans from Banks - SecuredMaturities - 1-3 years 3-5 years > 5 years TOTALRates of InterestTerm Loans from Scheduled Banks - Rupee7.01% - 9% 323.00 - - 323.00

(557.00) (323.00) - (880.00)9.01% - 12.00% 1,398.61 2,809.65 2,003.24 6,211.50

(3,410.00) (1,540.00) (4,138.00) (9,088.00)Term Loans from Scheduled Banks - Foreign CurrencyUSD LIBOR + 450 bps to 600 bps - - - -

(215.17) - - (215.17)TOTAL SECURED A 1,721.61 2,809.65 2,003.24 6,534.50

A (4,182.17) (1,863.00) (4,138.00) (10,183.17)Term Loans from Banks - UnsecuredMaturities - 1-3 years 3-5 years > 5 years TOTALRates of InterestTerm Loans from Scheduled Banks - Rupee10.50% 100.00 - - 100.00

(650.00) - - (650.00)Term Loans from Scheduled Banks - Foreign CurrencyUSD LIBOR + 325 bps - 599.30 - 599.30

(111.00) (572.00) - (683.00)TOTAL UNSECURED B 100.00 599.30 - 699.30

B (761.00) (572.00) - (1,333.00)TOTAL (SECURED & UNSECURED) A + B 1,821.61 3,408.95 2,003.24 7,233.80

A + B (4,943.17) (2,435.00) (4,138.00) (11,516.17)

C) TERM LOANS FROM OTHER PARTIES�� ?�� Z��@�

` in Crores

Term Loans from Other parties - SecuredMaturities - 1-3 years 3-5 years > 5 years TOTAL Rates of InterestAsian Development BankUSD LIBOR + 40 bps 11.86 13.42 36.94 62.22

(10.47) (11.83) (41.15) (63.45)Variable linked to Bank PLR 21.93 24.80 68.30 115.03

(20.62) (23.32) (81.08) (125.02)

�� (Continued)

134

Variable linked to G Sec 18.97 21.45 59.08 99.50

(17.84) (20.17) (70.13) (108.14)


1.70% 10.65 - - 10.65

(20.70) - - (20.70)

National Housing Bank

5.5% - 8% 456.40 309.75 100.62 866.77

(438.69) (260.53) (87.73) (786.95)

8.01% - 10% 776.75 442.18 678.95 1,897.88

(354.35) (91.60) (0.61) (446.56)

10.01% - 10.20% 93.89 - - 93.89

(730.26) (198.75) (233.46) (1,162.47)

TOTAL SECURED A 1,390.46 811.59 943.89 3,145.94

A (1,592.93) (606.20) (514.16) (2,713.29)

Term Loans from Other parties - Unsecured


Rates of Interest


6% 31.14 3.00 - 34.14

(21.70) (17.44) - (39.14)

TOTAL UNSECURED B 31.14 3.00 - 34.14

B (21.70) (17.44) - (39.14)

TOTAL (SECURED & UNSECURED) A + B 1,421.60 814.59 943.89 3,180.08

A + B (1,614.63) (623.64) (514.16) (2,752.43)

8. OTHER LONG-TERM LIABILITIES


` in Crores


` in Crores

Amounts payable on swaps [Refer Note 7.5] 486.08 459.60

Interest Accrued but not due on Borrowings 967.48 525.23

Interest Accrued and due on Borrowings 4.96 -

Security and Other Deposits Received 15.11 13.67

Income Received in Advance 31.13 22.04

Trade Payables 186.82 220.42

Accrued Redemption Loss on Investments 19.27 25.16

Others 0.07 -

1,710.92 1,266.12

�� (Continued)

135


9. LONG-TERM PROVISIONS


` in Crores


` in Crores

��%��'��`��/��z_�z� 43.69 42.49

Provision for Contingencies [Refer Notes 9.1 and 9.2] 1,315.40 1,270.04


Reserve for Unexpired Risk 198.05 129.27

1,872.48 1,697.50

9.1 Provision for Contingencies includes provisions for standard assets and all other contingencies. In accordance with the prudential norms of National Housing Bank and Reserve Bank of India, the minimum provision required to be carried forward is ` 1,150.58 crores (Previous Year ` 1,101.35 crores) and ` 1.99 crores (Previous Year ` 1.72 crores) respectively.

9.2 Movement in Provision for Contingencies Account during the year is as under:



Opening Balance 1,270.04 851.32

Additions during the year [Refer Note 5.3] 57.77 450.73

Utilised during the year towards Diminution in Value of Investments, etc. (12.41) (32.01)

Closing Balance 1,315.40 1,270.04

10. SHORT-TERM BORROWINGS


` in Crores


` in Crores

Loans repayable on demand:

- from Banks - Unsecured 279.60 8.28

Deposits - Unsecured [Refer Note 7.6] 5,652.81 1,799.71

Other loans and advances

- Scheduled Banks - Secured 3,285.00 14,540.11

- National Housing Bank - Secured 36.85 134.77

- Commercial Papers - Unsecured 9,675.00 4,650.00

18,929.26 21,132.87

10.1 Secured short-term borrowings are secured by negative lien on the assets of HDFC Ltd. and GRUH Finance Ltd.

11. TRADE PAYABLES


` in Crores


` in Crores

Trade payables 2,169.27 1,656.61

Amounts payable on swaps [Refer Note 7.5] 33.92 154.83

2,203.19 1,811.44

�� (Continued)

136

12. OTHER CURRENT LIABILITIES

Particulars

` in Crores


` in Crores


` in Crores

Policy Liabilities (Policyholder’s Fund) 4,238.40 3,583.60

Current maturities of long-term borrowings 51,114.90 43,898.86

Interest accrued but not due on borrowings 4,268.05 2,810.33

Interest accrued and due on matured deposits 33.10 30.57

Income and other amounts received in advance 249.69 192.06

Unclaimed dividend 12.38 10.31

Unclaimed matured deposits and interest accrued thereon 313.15 280.25

[�� 0.11 0.15

Other payables

- Statutory Remittances 203.69 87.44

- Grants received from Kreditanstalt für Wiederaufbau 164.78 140.90

- Amounts payable - Securitised Loans 449.39 458.11

- Amounts payable to Gratuity Fund 6.34 2.96

- Amounts payable Interest Rate Swaps 68.17 78.70

- Accrued Redemption Loss on Investments 9.40 3.31

- Others 637.17 577.55

6,415.41 4,672.64

61,768.71 52,155.10

^z�̂ � [�� ]!��'��


` in Crores


` in Crores

Current maturities of long-term borrowings - Secured


- Bonds 5.00 4.70

- Non-Convertible Debentures 19,918.30 13,767.00


- Scheduled Banks 5,052.74 11,979.45

- Short-Term Foreign Currency Borrowing [Refer Note 7.4] - 831.00

c) Term-Loans from other parties

- Asian Development Bank 24.05 22.30

- Kreditanstalt für Wiederaufbau 10.65 10.35

- National Housing Bank 892.75 991.37

�� (Continued)

137



` in Crores


` in Crores

Current maturities of long-term borrowings - Unsecured


- Non-Convertible Subordinated Debentures 411.00 40.00

b) Scheduled Banks 2,100.81 1,480.63

c) Under a line from Kreditanstalt für Wiederaufbau 5.00 2.03

d) Deposits [Refer Note 7.6] 22,694.60 14,770.03

51,114.90 43,898.86

12.2 Current maturities of Long Term Borrowings are secured by

(i) Negative lien on the assets of HDFC Ltd. and GRUH Finance Ltd.

(ii) Mortgage of property of HDFC Ltd. and GRUH Finance Ltd.

(iii) First charge by way of hypothecation of education loan receivables of one of the subsidiary company’s underlying portfolio of education loans and related collaterals.

12.3 Current maturities of Finance lease obligation are Secured by encumbrance on leased vehicles of one of the ��

13. SHORT-TERM PROVISIONS


` in Crores


` in Crores

��%��`��/��z_�z� 144.06 110.79


Provision for Tax (net of Advance Tax) 74.79 605.17

Proposed Dividend 1,932.93 1,624.67

Additional Tax on Proposed Dividend 336.08 273.43

Reserve for Unexpired Risk (Includes Insurance Reserve) [Refer Note 13.1] 736.75 576.57

3,627.23 3,748.02

13.1 Reserve for Unexpired Risk represents proportion of net premium written relating to the period of insurance subsequent to the Balance Sheet date, calculated on the basis of 1/365th method, or as required under Section 64V(1)(ii)(b) of the Insurance Act, 1938, i.e., subject to a minimum of 100% in case of marine hull business and 50% in case of other businesses based on net premium written during the year, whichever is higher in respect of a subsidiary company [HDFC ERGO General Insurance Co. Ltd.].

�� (Continued)

138

14. TANGIBLE ASSETS:

` in Crores


As at March 31, 2012 Additions Deductions


As at March 31, 2012 For the Year Deductions




Land :

Freehold 16.67 - - 16.67 - - - - 16.67 16.67

Leasehold 3.44 - - 3.44 0.58 0.04 - 0.62 2.82 2.86

Buildings :

(2) Own Use 519.36 0.05 0.04 519.37 49.93 3.62 (4.85) 58.40 460.97 469.43

Leasehold Improvements 53.61 8.85 2.27 60.19 36.35 7.77 1.17 42.95 17.24 17.26

Computer Hardware 197.14 31.05 17.50 210.69 157.15 9.10 5.34 160.91 49.78 39.99

Furniture & Fittings

Own Use 137.69 8.26 7.06 138.89 115.01 3.95 0.21 118.75 20.14 22.68

Under Operating Lease 0.71 - - 0.71 0.60 0.02 - 0.62 0.09 0.11

�� `��

Own Use 136.47 9.73 7.40 138.80 100.83 5.58 0.01 106.40 32.40 35.64

Under Operating Lease 0.80 - - 0.80 0.63 0.02 - 0.65 0.15 0.17

Vehicles :

Owned 15.33 7.45 2.02 20.76 8.49 2.20 0.65 10.04 10.72 6.84

Under Finance Lease 0.66 - - 0.66 0.40 - (0.13) 0.53 0.13 0.26

Leased Assets :

Plant & Machinery * 130.65 - - 130.65 130.65 - - 130.65 - -

Vehicles * 16.37 - - 16.37 16.37 - - 16.37 - -

Computers * 0.20 - - 0.20 0.20 - - 0.20 - -

Total 1,229.10 65.39 36.29 1,258.20 617.19 (2) 32.30 (1) 2.40 647.09 611.11 611.91

Previous Year 1,155.92 114.71 41.53 1,229.10 588.36 30.15 1.32 617.19 611.91 567.56

(*) Assets held for disposal

Notes:

(1) Net of depreciation for the year amounting to ` 31.83 crores (Previous Year ` 34.65 crores) included in Other expenses pertaining to Insurance Business.

?z@� �� *�� ` 2.42 crores (Previous Year ` 2.42 crores) being depreciation charge on Investment in Properties.

�� (Continued)

139


15. INTANGIBLE ASSETS:

` in Crores


As at March 31, 2012 Additions Deductions


As at March 31, 2012 For the Year Deductions




Computer Software

Owned 105.12 36.67 - 141.79 67.86 4.42 (15.29) 87.57 54.22 37.26

Goodwill 149.41 - - 149.41 134.44 14.92 - 149.36 0.05 14.97

Website Development 2.39 0.06 - 2.45 2.19 0.14 - 2.33 0.12 0.20

256.92 36.73 - 293.65 204.49 19.48 (1) (15.29) 239.26 54.39 52.43

Previous Year 237.92 19.00 - 256.92 175.45 18.07 (10.97) 204.49 52.43 62.47

Notes

(1) Net of depreciation for the year amounting to ` 15.30 crores (Previous Year ` 10.92 crores) included in Other expenses pertaining to Insurance Business.

16. NON-CURRENT INVESTMENTS


` in Crores


` in Crores

Investment in Associates:

Equity Shares

Equity Investments in Associates by the Holding Company 1,468.59 1,469.02

Equity Investments in Associate by Subsidiaries 73.32 73.32

1,541.91 1,542.34

Add: Goodwill on Acquisition of Associates

(share of pre-acquisition losses) 3,897.81 3,897.81

5,439.72 5,440.15

Less: Capital Reserve on acquisition of an Associate

��?� ��] �#��@ - (0.13)

5,439.72 5,440.02

<��<�\��] �#�� <�� (Equity Method) 7,123.13 5,687.27

12,562.85 11,127.29

Convertible Debentures (at cost) - 2.00

(A) 12,562.85 11,129.29

�� (Continued)

140


` in Crores


` in Crores

Other Investments

Insurance Companies

Equity Shares - Other Companies 18,235.16 16,819.58

Non-Convertible Debentures and Bonds 8,704.28 5,773.88

� �!��[�� `�� 112.69 113.70


Mutual Funds and Other Funds 15.20 16.95

Fixed Deposits 241.25 85.00

Properties (Net of Depreciation) 41.37 41.37

36,316.34 28,460.35

Add: Fair Value Adjustment 10.84 5.49

(B) 36,327.18 28,465.84


` in Crores


` in Crores

Investments related to Policy Holders 9,013.94 6,488.13

Investments to cover linked liabilities 24,807.00 20,272.79

Investments related to Shareholders 2,506.24 1,704.92

36,327.18 28,465.84

Other Than Insurance Companies

Equity Shares - Subsidiaries 10.44 -

Equity Shares - Other Companies 822.16 919.11

Preference Shares 57.75 22.78

Debentures and Bonds 777.43 753.43

Pass Through Securities & Security Receipts 71.05 71.87


Mutual Funds and Other Funds 124.99 126.31

Properties (Net of Depreciation) 141.55 144.18

4,809.69 3,814.51

Less: Provision for Diminution in Value of Investments (83.48) (54.21)

(C) 4,726.21 3,760.30

Total (A) + (B) + (C) 53,616.24 43,355.43

�� (Continued)

141


Book Value Market Value





Aggregate book value of Quoted Investments 457.94 535.26 722.88 1,087.42

Aggregate book value of Investments listed but not quoted 2,925.91 1,914.46 - -

Aggregate book value of Investments in Unquoted Mutual Funds 5.00 17.00 * 5.02 16.52

Aggregate book value of Unquoted Investments (Others) 1,195.81 1,149.40

Properties 141.55 144.18

4,726.21 3,760.30

* Market value of investments in Unquoted Mutual Funds represents repurchase price of units issued by Mutual Funds.

Note:

Unquoted investments include ` 14.03 crores (Previous Year ` 22.20 crores) in respect of equity shares, which are subject to a lock-in period and include ` 20.95 crores (Previous Year ` 20.95) in respect of equity shares, which are subject to restrictive covenant. Quoted investments include ` Nil (Previous Year ` 4,013.97 crores) in respect of equity shares which are subject to a lock-in period and include ` 60.74 crores (Previous Year ` 60.74 crores) in respect of equity shares, which are subject to restrictive covenant.

17. DEFERRED TAX ASSETS:

$�� <�� zz��~<��! *��$��[�� (Accounting Standards) Rules, 2006, credit has been taken for ` 5.25 crores (Previous Year ` 10.04 crores) �� + ��^��z{^�� *� �� ?��@� ��the year, arising on account of timing differences. ` Nil (Previous Year ` 168.07 crores) has been adjusted against the utilisation from Additional Reserve u/s 29C by HDFC Ltd. and ` Nil (Previous Year ` 3.76 crores) has been adjusted against the utilisation from the General Reserve by a subsidiary company as per Note 5.5.

Major components of deferred tax assets and liabilities arising on account of timing differences are :

` in Crores

Particulars Assets/(Liabilities)


(a) Depreciation (56.55) (53.36)

(b) Preliminary Expenses 0.03 0.04

(c) Provision for Contingencies 648.65 591.04

?�@� ��%��'�� 29.80 23.25

(e) Accrued Redemption Loss (net) 10.61 9.68

(f) Unabsorbed Depreciation 13.57 -

(g) Others (net) 13.49 83.70

Total 659.60 654.35

In respect of HDFC Ergo General Insurance Company Limited, in view of the existence of unabsorbed depreciation and carried forward business loss as at the year end, the recognition of deferred tax assets is restricted to the extent of deferred tax liability arising from timing differences on account of depreciation, reversal of which is virtually certain.

�� (Continued)

142

In respect of Credila Financial Services Pvt. Ltd., in view of carried forward losses, the recognition of Deferred tax asset has been restricted to the extent of closing Deferred tax liability, due to absence of virtual certainty �� * ��

18. LONG-TERM LOANS AND ADVANCES

` in Crores


` in Crores


` in Crores

Loans: [Refer Notes 18.1, 18.2 & 18.5] - Individuals 110,441.23 87,800.86 - Corporate Bodies 46,084.74 40,842.98 - Others 1,355.34 1,554.58

157,881.31 130,198.42 Less: Provision for Non-Performing Loans [Refer Notes 18.4 & 33.1] (Including additional provision made by HDFC Ltd. and GRUH Finance Ltd.) 481.98 460.07

157,399.33 129,738.35 Others:Corporate Deposits [Refer Note 18.3] - 647.70 Capital Advances - Unsecured; considered good 12.78 5.23 Security Deposits - Unsecured; considered good 220.28 221.01 Instalment due from Borrowers - Secured; considered good 79.17 -Other Long-Term Loans and Advances - Staff Loan others - Secured; considered good 14.82 10.99 - Prepaid Expenses - Unsecured; considered good 130.92 139.12 - Advance Tax (Net of Provision) 1,637.01 1,681.37 - Others - Unsecured, considered good 40.96 30.43

2,135.94 2,735.85 159,535.27 132,474.20

18.1 Out of Loans, amounts aggregating to ` 1,55,745.39 crores (Previous Year ` 1,28,428.96 crores) are secured or partly secured by:

(a) Equitable mortgage of property and/or

� ?�@� �� *�� J��

(c) Hypothecation of assets and/or

(d) Bank guarantees, company guarantees or personal guarantees and/or

(e) Negative lien and/or

(f) Assignment of hire purchase receivables and/or

(g) Undertaking to create a security.

18.2 Long-Term Loans and Advances include non-performing loans of ` 1,217.10 crores (Previous Year ` 1,090.24 crores).

18.3 Out of Corporate deposits, amounts aggregating to ` Nil (Previous Year ` 645 crores) are secured.

�� (Continued)

143


18.4 Movement in Provision for Non-Performing Loans is as under:


` in Crores


` in Crores

Opening Balance 460.07 325.74 Additions during the year [Refer Note 5.3] 39.11 160.51 Utilised during the year – towards Loans write offs (17.20) (26.18)Closing Balance 481.98 460.07

18.5 Loans include ` 27.99 crores (Previous Year ` 34.78 crores) in respect of properties held for disposal under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

19. OTHER NON-CURRENT ASSETS


` in Crores


` in Crores

Unamortised discount on Non-Convertible Debenture 20.22 36.56 Receivable on Securitised Loans 246.14 125.98 Foreign Currency Monetary Items Translation Difference Account [Refer Note 7.3] 123.28 140.39 Interest Accrued but not due on Loans 238.11 103.02 Interest accrued but not due on Bank Deposits 2.20 28.06 Income accrued but not due on Investments 132.84 552.12 Advance against Investment in Properties 52.43 54.52 Bank deposit with maturities beyond twelve months from the Balance Sheet date [Refer Note 19.1]

199.47 633.76

1,014.69 1,674.41

19.1 Bank deposits with maturities beyond twelve months includes earmarked balances of ` 62.23 crores (Previous Year ` 63.50 crores) against foreign currency loans.

20. CURRENT INVESTMENTS

Insurance Companies As at March 31, 2013

` in Crores


` in Crores

Non Convertible Debentures and Bonds 417.50 571.42 Security Receipts 32.49 -Government Securities 31.51 394.55 Mutual Funds and Other Funds 90.00 225.16 Fixed Deposits 212.00 212.00 Commercial Papers - 13.67 [�� 1,549.68 1,467.15 Treasury Bills 998.59 958.10 Repo Investments 1,185.95 746.81

(A) 4,517.72 4,588.86

�� (Continued)

144


` in Crores


` in Crores

Investments related to Policy Holders 1,713.39 1,502.13 Investments to cover linked liabilities 206.81 772.53 Investments related to Shareholders 2,597.52 2,314.20

4,517.72 4,588.86

Other Than Insurance CompaniesParticulars As at

March 31, 2013 ` in Crores


` in Crores

Held as Current Investments(At cost or market value whichever is lower unless stated otherwise)Non Convertible Debentures and Bonds 45.00 144.03 [�� 522.99 - Mutual Funds 661.34 503.55Current Maturities of Long-Term Investments (At cost)Security Receipts - 8.55 Government Securities 100.79 28.57 Mutual Funds and Other Funds 27.78 27.25Non Convertible Debentures and Bonds 2.00 -

1,359.90 711.95Less: Provision for Diminution in Value of Investments (1.44) (17.39)

(B) 1,358.46 694.56 Total (A) + (B) 5,876.18 5,283.42

Particulars Book Value ` in Crores

Market Value ` in Crores

Aggregate book value of Quoted Investments 99.91 102.76 Previous Year 76.22 41.32 Aggregate book value of Investments listed but not quoted 84.69 Previous Year 48.47 Aggregate book value of Investments in Unquoted Mutual Funds 621.23 *622.05 Previous Year 457.89 463.58 Aggregate book value of Unquoted Investments (Others) 552.63 Previous Year 111.98 1,358.46 Previous Year 694.56

*Market value of investments in Unquoted Mutual Funds represents repurchase price of units issued by Mutual Funds.

21. TRADE RECEIVABLES


` in Crores


` in Crores

Trade Receivables – Unsecured; Considered good, less than six months 206.95 632.63 Trade Receivables – Unsecured; Considered good, more than six months 9.07 -

216.02 632.63

�� (Continued)

145


22. CASH AND BANK BALANCES


` in Crores


` in Crores

(a) Cash and cash equivalents (i) Balances with banks: - In Current Accounts 1,177.42 1,277.19 - In Deposit Accounts with original maturity less than 3 months 2,888.70 1,892.88 (ii) Balances with Reserve Bank of India - 0.06 (iii) Cash on Hand 0.96 0.52 (iv) Cheques on Hand 330.38 234.46 Sub-total 4,397.46 3,405.11 (b) Other Bank balances: (i) Earmarked balances with banks - Unclaimed dividend account 12.38 10.31 - Against Foreign Currency Loans [Refer Note 7.4] 5.42 4.76 - Others [Refer Note 22.1] 2.68 2.67 (ii) Short-term bank deposits [Refer Note 22.2] 2,653.73 3,058.51

7,071.67 6,481.36

22.1 Earmarked balances with banks - Others include an amount of ` 2.59 crores (Previous Year ` 2.59 crores) given by HDFC Asset Management Company Limited (HDFC AMC) to HDFC Trustee Company Limited and held in a designated account maintained by the latter. This is in terms of an interim order dated June 17, 2010 and letter dated July 5, 2011 received from Securities and Exchange Board of India, representing the estimated losses incurred by the schemes of HDFC Mutual Fund/clients of HDFC AMC on suspected “front running” of the orders of HDFC Mutual Fund by a dealer of HDFC AMC. The exact liability, if any, in this matter cannot be determined at this stage.

22.2 Bank Deposits of Credila Financial Services Pvt. Ltd. of ` 1.20 crores (Previous Year ` Nil) are marked as lien for overdraft facility from Punjab National Bank.

23. SHORT-TERM LOANS AND ADVANCES

Particulars

` in Crores


` in Crores


` in Crores

Loans:Current maturities of long-term loans and advances [Refer Note 23.1] 18,418.46 15,196.03 Others:Current maturities of Staff Loans - Other Secured; Considered good 3.54 2.83 Corporate Deposits [Refer Note 23.2] 1,681.72 2,662.54 Instalments due from borrowers - Secured; considered good 1,270.23 530.04 Sundry Deposits - Unsecured; considered good 9.96 17.98 Other Advances - Unsecured; considered good 370.52 2,040.06 Others - Unsecured; considered doubtful 49.71 -

3,385.68 5,253.45 Less: Provision for Doubtful Receivables [Refer Note 5.3] 51.71 -

3,333.97 5,253.45 21,752.43 20,449.48

23.1 Out of current maturities of Long-term loans and advances, amounts aggregating to ` 17,381.49 crores (Previous Year ` 13,775.77 crores) are secured [Refer Note 18.1].

�� (Continued)

146

23.2 Out of Corporate deposits, amounts aggregating to ` 1,192.42 crores (Previous Year ` 2,101.44 crores) are secured and amounts aggregating to ` 2 crores (Previous Year ` Nil) are considered doubtful.

24. OTHER CURRENT ASSETS


` in Crores


` in Crores

Foreign Currency Monetary Items Translation Difference Account [Refer Note 7.3] 46.51 65.85 Unamortised Discount on Commercial Paper 245.48 116.37 Receivables on Securitised Loans 18.04 -Interest Accrued but not due on Loans 164.55 124.38 Income Accrued but not due on Investments 705.00 64.71 Interest Accrued but not due on Deposits 136.12 108.36 Application Money - Investments 7.39 2.50

1,323.09 482.17

25. CONTINGENT LIABILITIES AND COMMITMENTS

25.1 Contingent liability in respect of guarantees provided aggregated to ` 203.17 crores (Previous Year ` 783.95 crores).

25.2 Contingent liability in respect of income-tax demands, net of amounts provided for and disputed, amounts to ` 1,037.67 crores (Previous Year ` 771.89 crores). The matters in dispute are under appeal. Out of the above an amount of ` 832.52 crores (Previous Year ` 770.16 crores) has been paid/adjusted against refund and the same will be received as refund if the matters are decided in the favour of HDFC Ltd. and the respective subsidiary companies.

25.3 Contingent liability in respect of Interest tax demands, net of amount provided for and disputed in respect of one subsidiary company amounts to ` 0.07 crores (Previous Year ` 0.07 crores). The matter in dispute is under appeal. The subsidiary expects to succeed in the proceedings and hence no additional provision is considered necessary.

25.4 The subsidiary companies have received show cause cum demand notices, amounting to ` 134.55 crores (Previous Year ` ||��@��"��[��! *��+�� "�� !��subsidiary has been advised by an expert that their grounds of appeal are well supported in law. As a result, �� *�� crystalise into a liability.

25.5 Contingent Liability in respect of corporate undertakings provided by HDFC Ltd. for securitisation of receivables aggregated to ` 1,939.31 crores (Previous Year ` ^�_�{�̂ ��@��!��

25.6 Proportionate share of claims not acknowledged as debt and other contingent liabilities in respect of associate companies amounts to ` 1,238.57 crores (Previous Year ` 824.28 crores).

Claims not acknowledged as debt and other contingent liabilities in respect of a subsidiary company amounts to ` 1.37 crores (Previous Year ` 0.89 crores).

25.7 Contingent Liability in respect of disputed dues towards sales tax, wealth tax, interest on lease tax and payment

�� (Continued)

147


towards employers’ contribution to ESIC not provided for by HDFC Ltd. amounts to ` 0.15 crores (Previous Year ` 0.15 crores).

25.8 Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is ` 179.87 crores (Previous Year ` 274.55 crores).

26. REVENUE FROM OPERATIONS



Interest Income : - Interest on Loans 19,633.71 15,764.78 - Other Interest [Refer Note 26.1] 889.30 884.42 Net Gain/(Loss) on foreign currency transactions and translation 1.18 105.98 Dividends [Refer Note 26.2] 68.30 51.88 Management & Trusteeship Fees 776.24 683.82 Income from Leases [Refer Note 26.5] 7.96 17.52 Surplus from deployment in Cash Management Schemes of Mutual Funds [Refer Note 26.3]

256.74 335.62

Fees and Other Charges 399.03 379.90 22,032.46 18,223.92

26.1 a) Other Interest includes interest on investments amounting to ` 1,883.41 crores (Previous Year ` 1,329.50 crores).

b) Other Interest includes interest on investments amounting to ` 73.80 crores (Previous Year ` 66.38 crores) in respect of current investments.

26.2 Dividend income includes ` 20.67 crores (Previous Year ` 35.77 crores) in respect of current investments.

26.3 Surplus from deployment in Cash Management Schemes of Mutual Funds amounting to ` 256.74 crores (Previous Year ` 335.62 crores) is in respect of investments held as current investments.

26.4 Other Income includes rent of ` 10.15 crores (Previous Year ` 10 crores), of which ` 0.10 crores (Previous Year ` 0.24 crores) is in respect of rent for certain assets given on operating lease and also includes sub-lease payments received ` 0.31 crores (Previous Year ` 0.07 crores) in respect of a property acquired under operating lease as per Note 30.1.

z|�� $�� <�� ~�� ?<�� ^_@�� [�� ?<��Standards) Rules, 2006, the following disclosures are made in respect of Operating Leases:

Income from Leases includes ` 4.14 crores (Previous Year ` 4.46 crores) in respect of properties and certain assets leased out under Operating Leases. Out of the above, in respect of the non-cancellable leases, the future minimum lease payments are as follows:

Period Current Year ` in Crores


Not later than one year 2.63 4.32 � �� 3.58 6.05� �� - 1.05

27. �� ` 35.17 crores (Previous Year ` 32.04 crores) in respect of current investments.

�� (Continued)

148

28. FINANCE COST



INTEREST

- Loans 2,489.65 3,296.74

- Deposits 4,506.44 2,976.96

- Bonds and Debentures 5,918.37 4,772.62

- Commercial Paper 1,118.73 114.38

Sub Total 14,033.19 11,160.70

Net Loss on foreign currency transactions and translation 165.75 220.27

OTHER CHARGES 96.58 170.95

14,295.52 11,551.92

28.1 Other Charges includes Exchange Loss ` 0.10 crore (Previous Year Net of exchange gain ` 0.97 crore).

28.2 A net gain of ` 53.23 crores (Previous Year Net Gain of ` 25.36 crores) has been recognised in the Statement �� below:



Exchange (Gain)/Loss on Translation

- Foreign Currency Denominated Assets and Foreign Currency

Borrowings [Refer Note 7.3] (131.72) (54.87)

- Cross Currency Interest Rate Swaps [Refer Note 7.5] 78.49 29.51

Net (Gain)/Loss on Translation [Refer Note 7.3] (53.23) (25.36)

29. EMPLOYEE BENEFITS EXPENSES



Salaries and Bonus 463.16 392.66

Contribution to Provident Fund and Other Funds 49.35 40.64

Gratuity Expenses 1.55 1.03

Staff Training and Welfare Expenses 14.07 11.14

528.13 445.47

29.1 Salaries and Bonus include ` 15.81 crores (Previous Year ` 9.19 crores) and other expenses pertaining to Insurance Business include ` 12.65 crores (Previous Year ` 10.02 crores) towards provision made in respect �� !��%��'��and has been actuarially determined as per AS 15 (Revised).

29.2 `��$ � � ��

� $�� <�� %��'��?<��^�@��[�� ?<��Standards) Rules, 2006, the following disclosures have been made:

�� (Continued)

149


� !�� ` in Crores

Particulars Contributions to Provident Fund and Other Funds under Staff Expenses

Other expenses pertaining to Insurance Business


Provident Fund 17.87 14.86 22.50 18.83 Superannuation Fund 7.67 6.29 0.49 0.79 Employees’ Pension Scheme-1995 1.51 1.39 - - Employees’ State Insurance Corporation 1.70 1.70 3.19 3.25 Contribution to EDLI - 0.01 - - Labour Welfare Fund 0.01 0.04 0.06 0.06

The Rules of the Corporation’s Provident Fund administered by a Trust require that if the Board of Trustees are unable to pay interest at the rate declared for Employees’ Provident Fund by the Government under para 60 of the Employees’ Provident Fund Scheme, 1952 for the reason that the return on investment is less or for �� [�� $�� ` Nil (Previous Year ` 0.15 crores), included in Staff Training and Welfare Expenses, was made good by the Corporation.

� !�� ]�� ]��



�� Liability at the beginning of the year 133.13 114.30 Current Service Cost 10.27 9.54 Interest Cost 11.30 9.45� '�� (10.30) (8.37) Actuarial loss 20.62 8.21 Liability at the end of the year * 165.02 133.13 * The Liability at the end of the year ` 165.02 crores (Previous Year

` 133.13 crores) includes ` 38.73 crores (Previous Year ` 31.86 crores) in respect of un-funded plans.

Fair Value of Plan Assets: Fair Value of Plan Assets at the beginning of the year 94.08 74.13 Expected Return on Plan Assets 9.22 7.32 Contributions 22.41 25.62 � '�� (9.96) (8.37) Actuarial loss on Plan Assets (5.73) (4.62) Fair Value of Plan Assets at the end of the year 110.02 94.08 Total Actuarial loss to be recognised (26.35) (12.83)Actual Return on Plan Assets: Expected Return on Plan Assets 9.22 7.32 Actuarial loss on Plan Assets (5.73) (4.62) Actual Return on Plan Assets 3.49 2.70

�� (Continued)

150



Amount Recognised in the Balance Sheet: Liability at the end of the year 165.02 133.13 Fair Value of Plan Assets at the end of the year 110.02 94.08 Amount recognised in the Balance Sheet under “Provision for

`��'�� "��[�� 55.00 39.05

`�� !��"�� Current Service Cost 10.27 9.54 Interest Cost 11.30 9.45 Expected Return on Plan Assets (9.22) (7.32) Net Actuarial loss to be recognised 26.35 12.83� %*��

Expenses” included under Contribution to Provident Fund and Other Funds 29.68 21.28 included under Other expenses pertaining to Insurance Business 9.02 3.22

38.70 24.50Reconciliation of the Liability Recognised in the Balance Sheet: Opening Net Liability 39.05 40.17 Expense recognised 38.70 24.50 Contribution by the Corporation 22.41 25.62� '�� (0.34) - Amount recognised in the Balance Sheet under “Provision for

`��'�� "��[�� 55.00 39.05Experience Adjustment : On Plan Liabilities 21.16 10.09 On Plan Assets (5.74) (4.44) Estimated Contribution for next year 22.55 13.09

Investment Pattern:

Particulars % Invested Current Year

% Invested Previous Year

Central Government securities 23.19 22.26State Government securities/securities guaranteed by State/Central Government 1.35 2.00Public Sector/Financial Institutional Bonds 25.58 23.64Private Sector Bonds 8.86 12.44Special Deposit Scheme 2.01 2.35[�� 1.34 2.62Commercial Papers - -Deposits with Banks and Financial Institutions 2.76 2.80Investment in Insurance Cos * 9.57 8.50Investment in Equity Shares 17.16 17.41Others (including bank balances) 8.18 5.98Total 100.00 100.00

Based on the above allocation and the prevailing yields on these assets, the long-term estimate of the expected rate of return on fund assets has been arrived at.

* As the gratuity fund is managed by a life insurance company, details of investment are not available with the Company.

�� (Continued)

151


Principal Assumptions:

Particulars Current Year %

Previous Year %

Discount Rate 8.00 to 8.25 8.50 to 8.75Return on Plan Assets 8.00 to 8.70 8.25 to 8.60Salary Escalation 5 to 10 5 to 7

!�� Z�� promotion and other relevant factors.

� %*�� \�� of the Subsidiary company by erstwhile insurance company.

30. ESTABLISHMENT EXPENSES



Rent [Refer Note 30.1] 94.48 62.86 Rates and Taxes 4.05 4.52 Repairs and Maintenance - Buildings 6.40 5.65 �� "��%*�� 2.29 2.10 Electricity Charges 17.30 14.24 Insurance Charges 1.02 1.01

125.54 90.38

�{�̂ � $�� <�� ~�� ?<�� ^_@�� [�� ?<��Standards) Rules, 2006, the following disclosures are made in respect of Operating and Finance Leases:

(a) Properties under non-cancellable operating leases have been acquired, both for commercial and residential purposes. The total minimum lease payments for the current year, in respect thereof, included under Rent, amount to ` 115.62 crores (Previous Year ` 92.59 crores). Out of the above, the Corporation has sub-leased a property, the total sub-lease payments received in respect thereof included under Other Income amount to ` 0.31 crores (Previous Year ` 0.07 crores).

The future lease payments in respect of the above are as follows:



Not later than one year 81.46 52.76 � �� 84.69 75.02 � �� - 0.39

(b) Certain motor cars have been acquired under Operating Lease by a subsidiary company. In respect of these �� ` 0.85 crores (Previous Year ` {�|{��@��!�� amount to the following:



Not later than one year 1.04 0.68 � �� 1.74 1.08

(c) Certain motor cars, Information Technology equipment and Software have been acquired under Finance Lease by a subsidiary for an aggregate fair value of ` 0.18 crores (Previous Year ` 0.37 crores). The total minimum

�� (Continued)

152

lease payments (MLP) in respect thereof and the present value of the future lease payments, discounted at the interest rate implicit in the lease are:

` in Crores

Period Total MLP Interest PrincipalCurrent

YearPrevious

YearCurrent

YearPrevious

YearCurrent

YearPrevious

Year

Not later than one year 0.12 0.18 0.01 0.03 0.11 0.15 � �� 0.06 0.19 - 0.03 0.06 0.16

31. OTHER EXPENSES



Travelling and Conveyance 27.59 24.60 Printing and Stationery 13.68 11.24 Postage, Telephone and Fax 28.01 25.14 Advertising 49.43 52.02 Repairs and Maintenance - Other than Buildings 15.96 13.89 "��+ �� 21.82 20.02 Legal Expenses 17.84 12.81 Computer Expenses 10.55 8.67 Directors’ Fees and Commission 4.67 3.53Miscellaneous Expenses [Refer Note 5.10] 235.70 98.17 Auditors’ Remuneration [Refer Note 32] 4.72 2.88 Preliminary Expenses written off - 0.35

429.97 273.32

32. AUDITORS’ REMUNERATION



Audit Fees 2.90 2.23 Tax Matters 1.03 0.39 Other Matters 1.78 1.00 Reimbursement of Expenses 0.03 0.03 Service Tax (Net of Input credit) 0.24 0.14

5.98 3.79 Less: Included under commission and operating expenses pertaining to Insurance Business 1.26 0.91

4.72 2.88

33. PROVISION FOR NON-PERFORMING LOANS

33.1 As per the Housing Finance Companies (NHB) Directions, 2010, non-performing assets are recognised on the basis of ninety days overdue. The total provision carried by HDFC Ltd. and GRUH Finance Ltd., in terms of paragraph 29 (2) of the Housing Finance Companies (NHB) Directions, 2010 and NHB circular NHB.HFC, DIR-3/CMD/2011 dated August 5, 2011 in respect of Housing and Non-Housing Loans is as follows [Refer Note 18]:

` in CroresParticulars Sub-Standard Assets Doubtful Assets

Current Year Previous Year Current Year Previous YearHousing 53.67 75.34 184.47 187.99 Non-Housing 72.09 39.21 30.81 30.68

� �� [�� Value of Investments amounting to ` 10.01 crores (Previous Year ` 26.01 crores).

�� (Continued)

153


�� (Continued)

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154

35. RELATED PARTY TRANSACTIONS

� <��<�� ~`� �� ?<��^�@��[�� ?<��@�Standards) Rules, 2006, the related parties of the Corporation are as follows:

A) Subsidiary Companies B) Investing Party and its Group Companies

H T Parekh Foundation Standard Life Investments Ltd.

(w.e.f. 19th October, 2012) Standard Life (Mauritius Holdings) 2006 Ltd.

ERGO International AG

Munich Re

C) Associate Companies

HDFC Bank Ltd.

India Value Fund Advisors Pvt. Ltd

RuralShores Business Services Pvt. Ltd.

IPF Online Ltd.

Indian Association for Savings and Credit (upto 26th September, 2012)

D) Key Management Personnel E) Relatives of Key Management Personnel - (Where there are transactions)

Mr. Keki M. Mistry Ms. Arnaaz K. Mistry Mr. Rishi R. Sud Ms. V Rajalakshmi

Ms. Renu Sud Karnad Mr. Ashok Sud Ms. Riti Karnad Ms. V Jayam

Mr. V. Srinivasa Rangan Ms. Tinaz Mistry Ms. Swarn Sud

Mr. Ketan Karnad Ms. Abhinaya S. Rangan

I) The nature and volume of transactions of the Corporation during the year, with the above related parties were as follows:

` in Crores

Particulars Associates Investing Party and its Group Companies



Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Income/Transaction

Dividend 233.88 179.42 - - - - - -

Interest 29.37 9.66 - - - - - -

Consultancy and Other Fees - - 0.40 0.53 - - - -

Rent 1.71 1.68 - - - - 0.01 0.03

Reinsurance - - 0.03 2.04 - - - -

Miscellaneous Services 120.66 80.07 - - - 0.01 - 0.01

Expenditure/Transaction

Interest 3.71 1.06 - - 0.47 0.41 0.05 0.07

Bank and Other Charges 23.92 99.67 - - - - - -

Remuneration - - - - 16.93 13.56 - -

Reinsurance - - 2.65 7.88 - - - -

Dividend - - 44.28 33.21 - - - -

Other Expenses 736.46 614.28 0.09 - - - 0.09 0.06

�� (Continued)

155


` in Crores

Particulars Associates Investing Party and its Group Companies



Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Assets

Investments 6,313.05 5,991.61 - - - - - -

Bank Balance and Deposits 1,503.23 1,708.15 - - - - - -

Reinsurance - - - 0.02 - - - -

Loans - 3.79 - - 0.17 0.19 - -

Others 8.61 20.32 0.10 0.11 - - - -

Liabilities

Deposits 0.17 0.71 - - 5.30 3.87 0.40 0.51

Others 158.55 18.96 - - 0.21 0.19 0.03 0.04

During the year, the Corporation has sold individual loans amounting to ` 5,125 crores (Previous Year ` 4,978 crores) to HDFC Bank Ltd and Corporate Loan amounting to ` 50 crores (Previous Year ` Nil) to HDFC Standard Life Insurance Co. Ltd

II) The nature and volume of material transactions of the Corporation during the year, with the above related parties were as follows:

` in Crores

Particulars Associates Investing Party and its Group

Companies



Personnel

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Income/Transaction

Dividend

- HDFC Bank Ltd. 233.58 179.26 - - - - - -

Interest

- HDFC Bank Ltd. 29.25 8.92 - - - - - -

Consultancy and Other Fees

- Standard Life Investments Ltd - - 0.40 0.53 - - - -

Rent

- HDFC Bank Ltd. 1.71 1.68 - - - - - -

Reinsurance

- Munich Re - - 0.03 2.04 - - - -

Miscellaneous Services

- HDFC Bank Ltd. 120.66 80.07 - - - - - -

Expenditure/Transaction

Interest

- HDFC Bank Ltd. 3.71 1.06 - - - - - -

Bank and Other Charges

- HDFC Bank Ltd. 23.92 99.67 - - - - - -

�� (Continued)

156

` in Crores

Particulars Associates Investing Party and its Group

Companies



Personnel

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Reinsurance

- Munich Re - - 2.65 7.88 - - - -

Remuneration

- Mr. Keki M. Mistry - - - - 6.77 5.62 - -

- Ms. Renu S. Karnad - - - - 6.28 5.22 - -

- Mr. V. S. Rangan - - - - 3.87 2.71 - -

Dividend

- Standard Life Investments Ltd - - 44.28 33.21 - - - -

Other Expenses

- HDFC Bank Ltd. 736.31 614.28 - - - - - -

Assets

Investments

- HDFC Bank Ltd. 6,304.22 5,980.48 - - - - - -

Bank Balance and Deposits

- HDFC Bank Ltd. 1,500.23 1,708.15 - - - - - -

Loans

- Ms. Renu S. Karnad - - - - 0.06 0.07 - -

- Mr. V. S. Rangan - - - - 0.11 0.12 - -

Others

- HDFC Bank Ltd. 8.61 20.32 - - - - - -

Liabilities

Deposits

- Mr. Keki M. Mistry - - - - 3.28 3.85 - -

- Ms. Renu S. Karnad - - - - 2.02 0.02 - -

Others

- HDFC Bank Ltd. 158.55 18.96 - - - - - -

36. $�� <�� % �� ?<�z{@��[�� ?<��Standards) Rules, 2006, the following disclosures have been made:

� ?�@� $�� ' ��% �� <��! *� �� ` 6,639.72 crores (Previous Year ` 5,462.51 crores) has been adjusted for amounts utilised out of Shelter Assistance Reserve of ` 9.13 crores (Previous Year ` 6.89 crores) and for proportionate share of utilization out of Corporate Social Responsibility Fund of ` 0.69 crore (Previous Year ` 0.29 crores) of one of the subsidiary companies.

� � <�� ' ��% �� \��<��! *�attributable to Group of ` 6,629.90 crores (Previous Year ` 5,455.33 crores) and the weighted average number of shares during the year of ` 151.97 crores (Previous Year 147.17 crores).

�� (Continued)

157


(ii) The reconciliation between the Basic and the Diluted Earnings Per Share is as follows :

Amount in `


Basic Earnings Per Share 43.63 37.07

Effect of outstanding Stock Options (0.54) (0.57)

Diluted Earnings Per Share 43.09 36.50

� ?��@� !�� ' �� % �� \�� <�� ! *� �� weighted average number of equity shares for the respective periods; whereas the Diluted Earnings Per �� \��<��! *�� equity shares, after giving dilutive effect of the outstanding Stock Options for the respective periods. The relevant details as described above are as follows:

Numbers in Crores


Weighted average number of shares for computation of Basic Earnings Per Share 151.97 147.17

Diluted effect of outstanding Stock Options 1.90 2.30

Weighted average number of shares for computation of Diluted Earnings Per Share 153.87 149.47

�� (Continued)

158

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159


Social Initiatives

HDFC continued its involvement in socially responsive actions primarily aimed at improving the quality of life of our surrounding communities. The following pages will illustrate the varied projects supported by HDFC through the Shelter Assistance Reserve.

A mixed spectrum of development initiatives were supported this year, involving close to 180 partner organisations spread across the country. The segment-wise break-up of the utilization of the Reserve is illustrated in the chart below:

Cited below are a few cases in no �� projects supported by HDFC out of the Reserve during FY2012-13:

Vicharata Samuday Samarthan Manch

Vicharata Samuday Samarthan Manch (VSSM) works for the rights and welfare of nomadic & de-notified communities and aims to help mainstream these communities by �� Currently, it is working for 40 nomadic ��]��Gujarat. The children from nomadic

Child Welfare 10%

Differently Abled 15%

Community Development15%

Education 24%

Health & Medical Services17%

Culture & Conservation9%

Segment-wise Utilisation of the Reserve for 2012-13

Research & Policy Initiatives 10%

��]�� not enjoy their fundamental right to education. Due to the discrimination faced by these children in existing schools, VSSM has set up alternate methods of teaching. VSSM believes �� long-term empowerment and hence has set up alternate schools or tent schools in remote settlements to inculcate the habits of school life amongst the children. The children are taught to work within the boundaries of classrooms with the long-term aim to integrate them into the formal school system.

Today, VSSM runs 31 such ‘bridge schools’ which provide elementary education wherein children are taught not only to read and write, but basic skills and nutritious meals. Each tent school runs for around 5 – 7 years until the children are ready to be integrated into the government schools. The ‘bridge school’ program caters to over a 1,000 children annually. HDFC has adopted the running of 5 such ‘bridge schools’ spread across Gujarat.

The Bombay Community Public Trust

<� �� in India, The Bombay Community Public Trust (BCPT) was set up as a model organisation with the primary task of administering public funds for improving the quality of life of Mumbai’s citizens. Over the years BCPT has acted as a facilitator and a catalyst for projects and NGOs trying to address the various issues that confront the city of Mumbai. Over the years HDFC has tied up with BCPT to partner several projects, one of which is highlighted below:

Masoom

Masoom is working towards improving the quality of education in night schools across Mumbai. In order to achieve this, Masoom partners with night schools to facilitate the ‘Night School Transformation Programme’. The Transformation Programme is �� of the night school and the individual students. Masoom’s strategic model is designed to assess and improve the infrastructure, such as assessing the volume of notebooks available, providing textbooks and study material, setting up mobile science labs, providing daily nutrition, etc. Secondly, it assesses capacity, such as breadth and diversity of subjects taught and the quality of teaching provided. Finally, Masoom works as an advocate for the rights of the night school students, aiming to increase governmental support. Masoom brings together the teachers, head masters and trustees to share valuable information and deliver programme improvements. HDFC, through BCPT has partnered with Masoom towards the running of the ‘Night School Transformation Programme’ across 2 night schools in Mumbai.

160

Yuva Mitra

Yuva Mitra has been working in the �� and women empowerment for the last seven years in Sinner Taluka of Nashik. The activities of the organisation include creative methodology for children education and formation and development of self help groups engaging in savings and credit activities. The organisation has also taken up the issue of malnutrition in the Taluka.

The organisation had approached HDFC for a program on imparting life skill training for adolescent girls. The program focuses on the particular needs of adolescent girls in rural areas - their general vulnerability, inaccessibility to basic health care and education, understanding about reproductive health needs and rights and misconceptions about age old traditions. Yuva Mitra aims to impart �� Z�� in these adolescent girls through this program and also thereby change the approach of parents and teachers who make an impact on their lives. The program was run across 50 schools impacting over 8,000 adolescent girls.

Institute of Fundamental Studies & Research

The Institute of Fundamental Studies ��̀ �� ?$Q� `@�� ]��]��organisation promoted by committed individuals who have extensive knowledge and working experience pertaining to the life, culture, issues and challenges faced by the socially and economically vulnerable and marginalised communities of the Thar region. The organisation aims to empower the rural communities in the harsh, predominantly barren and remote desert region of the Thar

by offering them strategic support and guidance that would initiate and sustain socially just and optimum ecological practices.

In order to bring about qualitative change exclusively in the lives of the children coming from a poor socio-economic background, the IFSaR Upper Primary School, a day-boarding school was established in village Gharsisar, Bikaner. The school is recognized by the Dept. of Education, Govt. of Rajasthan for providing education up to class VIII and follows the State Govt. Board’s curriculum. This establishment was conceived not merely as a school but as a rural centre for learning. HDFC has supported the construction of additional classrooms at the school premises in order to be able to cater to more number of children.

Tata Institute of Social Sciences

HDFC has been associated with �� \�� !��! � �Institute of Social Sciences (TISS) for several years. This year too HDFC supported the Institute on three projects, one of which is highlighted below:

Project TANDA

The TANDA (Towards Advocacy Networking and Developmental Action) is a field action project initiated by TISS in 2009 to work on entitlements and rights of de-�� in Mumbai, Navi Mumbai and Raigadh. These communities are not organized, live in extremely unhygienic conditions and there is no external intervention to support �� and other entitlements. They remain vulnerable to economic and social stigmas as a result of poverty and marginalization.

TANDA has started working with the ‘Pardhi, Vadar, Banjara and Masanjogi’ community and is engaged with over 2,000 families. The project has created self-help groups of women with the focus to engage them in policy lobbying and advocacy. The aim is to create self-reliant communities who enjoy constitutional rights and entitlements, to advocate with policy makers to include these communities in government welfare schemes, collaborate with other NGOs working on similar issues and identify resources meant for these communities.

Muskaan

Muskaan is a voluntary organisation of parents and professionals, established in 1982 providing comprehensive education, vocational training and work opportunities to young people who are mentally challenged. The organisation offers support services to parents as well as raises awareness about the various issues surrounding people with intellectual disabilities. Sometimes, due to incomplete development of the brain, intellectual/cognitive functions are not fully developed in some people. This range of conditions is generally referred to as ‘intellectual disability’ or ‘learning disability’. Muskaan caters to all such levels of disability with the aim to making these individuals contributing members of mainstream society.

A group of parents within Muskaan have created a residential facility for adults with disabilities who will need assisted living for life. The National Trust set up by the government has leased Muskaan 3 acres of land in Dera village for this purpose. The building has been renovated for �� !��

161


of people with disabilities has already joined in from July 2012. This facility is an integrated setting providing an all-inclusive, individually planned care and training centre aimed at making residents independent.

Cochin Metropolis Charitable Trust

Rotary Club of Cochin Metropolis has adopted two schools - Government Lower Primary School at Ponnurunni and Higher Secondary School of Jesus at Kothad. The schools cater to students from the lowest socio economic strata of the society. The Club provides all requisite material to the students including a mid-day meal, runs regular medical camps and also set up a computer and library in the school premises. There is lack of sanitation facilities for the girl students in the schools which lead to dropouts and health & hygiene issues.

To provide proper sanitation facilities to the girl students and create in them the awareness and need for personal hygiene and sanitation a total of 12 toilet blocks were constructed by HDFC in partnership with the Trust (2 blocks in the Government Lower Primary School at Ponnurunni & 10 blocks in Higher Secondary School of Jesus at Kothad). This project will provide sanitation facility to 570 girl students in both the schools.

Foundation for Twinkling Little Eyes

The Foundation with its out-reach programs aiming to redress the suffering of low income groups living in rural and urban slums and tribal areas in Maharashtra through free eye camps and free eye treatment. The Foundation is committed to eradicate the needless and avoidable blindness in society through better access to eye care and quality care

treatment. Creation of awareness of diseases among general public and medical fraternity is one of the main objectives of the Foundation.

The Foundation conducts a door to door survey to detect eye related �� Z��- at Dharavi, Chembur, Mankhurd, Govandi and Dahisar. Those with an eye ailment are counseled to attend screening camps which are conducted free of cost in the slum pockets. The Foundation conducts over 100 such camps and 70 children camps across municipal schools in these slum pockets. Those with eye ailments are brought in for follow-up at the OPD in Dharavi. HDFC partnered the Foundation in meeting the expenses of carrying out the camps across slum pockets and schools.

Bhagwan Mahaveer V ik lang Sahayata Samiti

The Bhagwan Mahaveer Viklang Sahayata Samiti (BMVSS), more popularly known as Jaipur Foot was set up in 1975 for helping the physically challenged, particularly �� Z� �� BMVSS is the largest organization, for the handicapped in the world in �� and calipers etc. for the physically challenged. BMVSS provides all their services totally free of charge.

The organisation has benefitted more than 1.25 million disabled persons from across India with �� |{�{{{� �� calipers being provided annually. The organisation has signed MoUs with Stanford and MIT which has resulted in collaborations such as the Jaipur Knee. The Foundation has also held �� z|� ��in Asia, Africa and Latin America.

The total annual expenditure of the organisation comes to Rs. 16 crore of which approx. 40% is met through Government schemes. The balance is raised from donations and HDFC has partnered with the organisation on their charitable initiative.

Helen Keller Institute for the Deaf and Deafblind

The Helen Keller Institute for the Deaf and Deafblind was started in 1977 with the belief that every type of disability can be overcome through education and training. It is also �� $�� build and develop services for the deaf / deafblind children and young adults through day-care / residential facilities and other ancillary services.

The Institute runs a school cum residential facility for deaf / deafblind students in Navi Mumbai. The establishment is equipped with a diagnostic lab and a therapy room for the children. The facility caters to over 100 deafblind children. The institute approached HDFC to install a 20KW roof top solar power system which will aid in reducing the electricity consumption in the building to a large extent.

SWADHAR Institute for Development of Women and Children

Swadhar was established in 1995 in Pune with the main aim to work with women in distress and with under-privileged children. The emphasis is on ensuring their development through guidance, counseling, education and empowerment. As of today, through its various programs Swadhar reaches out to over 13,000 women and children.

Swadhar runs a project titled ‘Mohor’ for development of children living in red-light areas of Pune. The aim of

162

the project is to provide a normal, safe childhood for the children along with education, medical assistance and overall development. The objectives are to protect and develop the children, to �� to the girl children thereby making them aware of their rights. The children attend Swadhar run crèches, day-care centres and night shelters. The mothers are encouraged to enroll their children into school and ensure a normal childhood and good future for them. HDFC partnered Swadhar towards their ‘Mohor’ project for a period of one year.

Shankari Foundation

The Shankari Foundation has been working on providing various facilities towards supporting the vulnerable elderly community in Bengaluru. The organisation runs a day-care centre for senior citizens. The centre provides social, recreational and medical facilities for the elderly. The organisation also runs a helpline for women in distress, health-awareness

camps and a referral centre wherein cases are recommended for other services.

The Foundation had approached HDFC for assistance towards an old age home that has been set up in Malleshwaram, Bengaluru. The construction of the building is complete with donations from various corporate houses and individual donors. However, the Foundation has been unable to operationalize the home in the absence of essential items such as cots, beds, chairs, storage units etc. HDFC partnered the Foundation for assistance towards meeting the expenses for purchase of the essential furniture requirements which will enable the running of the old age home.

CanKids KidsCan

In 2004, CanKids was set up under the umbrella of Indian Cancer Society, New Delhi as their childhood cancer unit. The vision was to provide the entire spectrum of assistance to children with cancer and their

families, anywhere in India, to enable best standards of treatment, care and support, and to ensure no child suffered for want of treatment for �Z��

The treatment for childhood cancer is long, spanning anywhere between 6 months to 3 years. During this period children are deprived of any form of education which makes it �� back into the school system. The organisation has opened up $�� children with cancer, in partnership with the Municipal Corporation of Mumbai. The organisation has been given space in an existing municipal school to conduct both formal and non-formal education with children who are undergoing treatment for cancer. Children receive � �� – education, books, uniforms and nutrition. The organisation provides for reimbursement of transport expenses and a school bus pick up and drops the children. Currently 70 children are registered under this program.

163


Secretarial Audit Report

The Board of DirectorsHousing Development Finance Corporation Limited‘Ramon House’, H. T. Parekh Marg, 169, Backbay Reclamation,Churchgate, Mumbai 400 020.

We have examined the registers, records, books and papers of Housing Development Finance Corporation Limited (HDFC) (the [�� @�� at ‘Ramon House’, H. T. Parekh Marg, 169, Backbay Reclamation, Churchgate, Mumbai 400 020 and having Corporate Identity Number (CIN) L70100MH1977PLC019916, as required to be maintained under the Companies Act, 1956, (the Act) and the Rules made thereunder and also the provisions contained in the Memorandum and Articles of Association of the Company for the period from April 1, 2012 to March 31, 2013. In our opinion and to the best of our information and according to the examinations carried out by us and explanations furnished to us �� [�� certify that in respect of the aforesaid ��

1. The Company has kept and maintained all registers and records as required under the provisions of the Act and the Rules made thereunder and the entries therein have been duly recorded.

2. The Company has duly filed the forms, returns and documents with the Registrar of Companies, Maharashtra / Ministry of Corporate Affairs and other authorities as required under the Act and Rules made thereunder.

3. All the requirements relating to the meetings of Board of Directors, Commit tee of D i rectors and Shareholders as well as relating to the minutes of the proceedings thereat have been complied with.

4. The Board of Directors of the Company is duly constituted.

5. The Directors of the Company have made a l l the requi red disclosures under Sections 299, 305 and 274(1)(g) of the Act. Pursuant to the disclosures made by the Directors, the Company has complied with the prescribed requirements.

6. The issue of capita l and securities is in conformity with the requirements of the Act. The issues �� and transmission thereof have been registered properly.

7. The Company has obtained all the necessary approvals from the Directors, Shareholders and other authorities as required under the Act.

8. The Company has complied with all the provisions of the listing agreements with BSE Limited and National Stock Exchange of India Limited.

9. The Company has transferred the dividend declared on July 11, 2012 to a separate dividend account on July 12, 2012 and all the unpaid/ unclaimed dividend accounts have been reconciled.

10. During the year under review, the Company has transferred to the Investor Education and Protection Fund, unclaimed dividend amounting to ` 52,39,239 that has not been claimed by the shareholders for the �� z{{�]{�� with the provisions of the Act.

11. The Company has framed an insider trading code called ‘HDFC - Share Dealing Code’

strictly on the lines of model code p r e s c r i b e d u n d e r t h e S E B I (Prohibition of Insider Trading) Regulations, 1992 as amended and the same has been implemented during the year under review. Mr. Girish V. Koliyote, Company Secretary acts as the Compliance "��

12. The Company has complied with the disclosure requirements of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 and SEBI (Prohibition of Insider Trading) Regulations, 1992.

13. The Company is registered with the Securities and Exchange Board of India (SEBI) as ‘Category II – In House Share Transfer Agent’ and holds a valid permanent �� !��[�� has established connectivity with the National Securities Depository Limited (NSDL) and the Central Depository Services (India) Limited (CDSL). The Company has also complied with SEBI (Registrars to an Issue and Share Transfer Agents) Regulations, 1993.

14. The Company has complied with the provisions of SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 during the year under review.

For N. L. Bhatia & AssociatesCompany Secretaries

N. L. BhatiaMUMBAI FCS – 1176

April 22, 2013 CP No. – 422

164

Shareholders’ Information

This section inter alia provides information pertaining to the Corporation, its shareholding pattern, means of dissemination of information, service standards, share price movements and such other information, in terms of point no. 9 of Annexure IC to Clause 49 of the listing agreements relating to Corporate Governance.

� �� Ramon House,H. T. Parekh Marg, 169, Backbay Reclamation, Churchgate, Mumbai 400 020. Tel. Nos. : +91 22-2282 0282, 6631 6000 Fax Nos. : +91 22-2204 6758, 2281 1203 Website : www.hdfc.com

Investor Services Department (ISD)Tel Rasayan Bhavan,Gr. Floor, Opp. BEST Workshop Gate No. 4,Tilak Road Extn., Dadar T.T.,Dadar (E), Mumbai 400 014.Tel. Nos. : +91 22-6141 3900, 2414 6267/68Fax No. : +91 22-2414 7301E-mail : [email protected]

36th Annual General Meeting (AGM)

Day/Date : Friday, July 19, 2013

Time : 3.00 p.m.

Venue : Birla Matushri Sabhagar, 19, New Marine Lines, Mumbai 400 020.

Financial Year

!��[�� <��^��+ ��^��

Payment of Dividend

The Board of Directors of the Corporation has recommended payment of dividend of ` 12.50 per equity share of ` 2 � �� + ��^��z{^�� <�+�?�� ` 11 per equity share of ` 2 each).

Book Closure

Pursuant to the provisions of Section 154 of the Companies Act, 1956, the Register of Members and the Share Transfer Books of the Corporation will remain closed from Tuesday, July 2, 2013 to Friday, July 19, 2013 (both days ��@�� z{^z]^��

The dividend of ` 12.50 per equity share of ` 2 each as recommended by the Board of Directors, if approved by the members at the AGM, will be dispatched/remitted commencing from the day after the AGM to those members whose � �� `��+��[�� J�� the depositories, as at the close of business hours on Monday, July 1, 2013.

Financial Calendar for the Year 2013-14

The tentative schedule for holding meetings of the Audit Committee/Board of Directors of the Corporation and the 37th Annual General Meeting are as under:

Nature of meeting Purpose Probable date

Audit Committee/Board Meeting To review and approve the un-audited stand- �� [�� #� ��June 30, 2013, subject to a limited review by the auditors of the Corporation.

By the third week of July 2013

Audit Committee/Board Meeting To review and approve the un-audited stand- �� [�� #� ��J half-year ending September 30, 2013, subject to a limited review by the auditors of the Corporation.

By the third week of October 2013

165


Nature of meeting Purpose Probable date

Audit Committee/Board Meeting To review and approve the un-audited stand- �� [�� #� ��J�� months ending December 31, 2013, subject to a limited review by the auditors of the Corporation.

By the third week of January 2014

Audit Committee/Board Meeting To inter alia review and approve the audited financial results of the Corporation and the �� year ending March 31, 2014 and recommend �� March 31, 2014.

By the second week of May 2014

Audit Committee/Board Meeting To review and approve the un-audited stand-alone financial results of the Corporation and the �� #� ��June 30, 2014, subject to a limited review by the auditors of the Corporation. By the third week of July 2014

37th Annual General Meeting Adoption of audited annual accounts of the Corporation, declaration of dividend, if any, re-appointment of directors, appointment of statutory auditors, etc.

In addition to the above, meetings of Investor Relations & Grievance Committee of Directors will be convened to inter alia review the status of investors’ grievance, activities relating to ISD and compliances with applicable corporate and securities laws. Further, additional meetings of the Board or Committee of Directors of the Corporation may be convened as and when deemed necessary.

Listing on Stock Exchanges

Equity Shares

The equity shares of the Corporation are listed on the following stock exchanges and are tradable on all other �� Z��*�� $�� !��$�� $�� /��?$�$/@�� #�� is INE001A01036.

BSE Limited (BSE)Phiroze Jeejeebhoy Towers,Dalal Street,Mumbai 400 001.Tel. Nos. : +91 22-2272 1233/34Fax Nos. : +91 22-2272 2037/3121/3719E-mail : [email protected] : www.bseindia.com

National Stock Exchange of India Limited (NSE)Exchange Plaza, Plot No. C/1, G. Block,Bandra-Kurla Complex,Bandra (E), Mumbai 400 051Tel. Nos. : +91 22-2659 8235/36Fax Nos. : +91 22-2659 8237/38E-mail : [email protected] : www.nseindia.com

Stock Exchange Codes: Reuters Codes: Bloomberg Codes:

BSE - 500010 BSE - HDFC.BO BSE - HDFC

NSE - HDFC EQ NSE - HDFC.NS NSE - NHDFC

166

Warrants

In terms of the Placement Document dated August 21, 2009, the Warrant holders were entitled to exercise their right to exchange the Warrants held by them with the corresponding number of equity shares of ` 2 each of the Corporation, on or before August 24, 2012, at a Warrant Exercise Price of ` 600 per equity share of ` 2 each.

The Corporation received 5,47,43,150 Warrants for exchange with equity shares of ` 2 each of the Corporation. Consequently, the Corporation issued and allotted 5,47,43,150 equity shares of ` 2 each and realized an amount of ` 3,284.59 crores, representing 99.95% of the Warrants issued.

The remaining 25,380 Warrants which were not submitted for exchange with the equity shares of the Corporation have lapsed and ceased to be valid. Accordingly, the amount paid towards them stands forfeited.

Debt Securities

The Non-Convertible Debentures (NCD) issued by the Corporation are listed for trading on the Wholesale Debt Market segments of the NSE and BSE.

Listing Fees

!�� '�%� ��/�%�� z{^�]^��

Investor Services Department (ISD)

The Corporation is committed to provide all investor related services in a timely, transparent and reliable manner through streamlined processes administered by committed and trained personnel.

The Corporation has been granted permanent registration by the Securities and Exchange Board of India (SEBI) to act as an in-house Share Transfer Agent – Category II. The Corporation has connectivity with both the depositories viz. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The ISD has a dedicated and well trained staff to cater to the needs of 1,94,908 shareholders representing a market capitalization of ` 1,27,767 crores and 5,063 debenture holders with a portfolio of `��_��_{��? �� + ��^��z{^�@�

The ISD offers services pertaining to transfer, transmission, transposition, dematerialization, re-materialization of shares, issue of duplicate/re-validated dividend warrants, issue of duplicate, replaced, consolidated and split share �� Z� �� Z��remittance of dividend through Electronic Clearing Service (ECS), National Electronic Clearing Service (NECS), Direct Credit Service (DCS), Real Time Gross Settlement (RTGS), National Electronic Funds Transfer (NEFT), issuing reminders to members to claim their dividend which is due for transfer to the Investor Education and Protection Fund (IEPF) and processes applications received in respect of unclaimed shares.

Shareholders holding shares in physical form are requested to contact the ISD for any of the aforesaid services. However, those holding shares in electronic form are required to directly contact their Depository Participant(s) (DP) for any of the aforesaid services, excluding services relating to unclaimed dividend and unclaimed shares.

Share Transfer System

In terms of Clause 49 (IV) (G) (iv) of the listing agreements, the Board of Directors of the Corporation, has constituted �� $�� [�� ?$�[@� �� Department. The board has also constituted a Share Transfer Committee (STC), which comprises the Chairman and the whole-time directors of the Corporation.

The ISC is authorized to approve transfer, transmission, transposition, dematerialization and re-materialization of � �� ![�� !��$�[� �� ![� �� [�� <�� ^_�|�� [�� ?$�� [�� @� `�� ^_|{�� relevant Standard Operating Procedures (SOP) and within the service standards adopted by the Corporation, from time to time.

167


<�� J ��![�� #��$��`� ��& Grievance Committe��J�� J� �� J ��

Service Standards

The Corporation is committed to providing effective and prompt service to its investors. The ISD has been entrusted with the responsibility of ensuring that the investors of the Corporation are serviced within the adopted service standards. Listed below are the service standards adopted by the Corporation in respect of various services being rendered by the ISD.

Nature of Service* Mode of receipt of request

Through post Over the counter

Transfer of shares 3 working days 20 minutes

Transposition of names 3 working days 20 minutes

Change of address/ECS/Bank details 3 working days 20 minutes

Registration of Nomination 3 working days 20 minutes

Issue of duplicate/re-validation of dividend warrant(s) 4 working days 20 minutes

Transmission of shares/Deletion of name 7 working days -

��J`�� J[�� ?@ 7 working days -

Dematerialization of shares 8 working days -

Re-materialization of shares 8 working days -

Release of unclaimed shares 10 working days -

$�� ?@ 30 working days -

�� .

The investors are requested to contact the ISD for availing any of the said services. The Corporation has designated an exclusive e-mail address viz. [email protected], which would enable investors to post their grievance and monitor its redressal. Key Managerial Personnel of the ISD (KMP) have been entrusted with the task of accounting and reviewing all correspondence/complaints received by the Corporation and ensuring its redressal in accordance with the relevant SOP and within the said service standards.

A status report on adherence to the said service standards is reviewed by the company secretary on a monthly basis and a detailed report is tabled at the meetings of the Investor Relations & Grievance Committee, on a quarterly basis, for its review and noting.

Investors’ Grievances

During the year under review, the Corporation received 4,760 correspondence and 1,217 e-mails (addressed to [email protected]) from its investors, capital market intermediaries and statutory/regulatory authorities, inter alia requesting for dematerialization of shares, transfer/transmission of shares, issue of duplicate/re-validated �� ]�� J�� Z� �� of the shareholders, annual report, etc., and other services relating to the securities of the Corporation.

The said correspondence/e-mails were reviewed by the KMP, before forwarding the same to the concerned service provider for appropriate response, in accordance with the relevant SOP and said service standards.

168

SEBI vide Circular No. CIR/01AE/2/2011 dated June 3, 2011, informed all the listed companies about processing of investor complaints through a centralized web based complaints redress system known as SEBI Complaints Redress System (SCORES). During the year under review, the Corporation received 13 complaints through SCORES, all of which were responded to, in accordance with the said Circular.

!�� [�� are as under:

Received from No. of complaints received No. of complaintsunresolved as on March 31, 20132010-11 2011-12 2012-13

Stock Exchanges and SEBI including SCORES 15 14 18 Nil

NHB, RBI, MCA and others 3 Nil 2 Nil

Directly received from investors relating to:

^�� /��]�� ?@ 2 Nil Nil Nil

z�� /��]��]�� ?@ Nil Nil Nil Nil

3. Delay in dematerialization of shares Nil Nil Nil Nil

4. Non-receipt of dividend warrants Nil 2 Nil Nil

5. Non-receipt of annual report Nil 1 Nil Nil

6. Change of shareholders’ details 1 1 Nil Nil

7. Non-receipt of bonus shares Nil Nil Nil Nil

Total No. of complaints received 21 18 20 Nil

Total No. of complaints redressed 22* 18 20 Nil

* 1 complaint was outstanding as on April 1, 2010.

There was no investor complaint that was unresolved as on April 1, 2012. During the year, the Corporation received 20 investor complaints. All of them were resolved and as such there were no unresolved investor complaints as on March 31, 2013.

The status of correspondence/complaints received and redressed by the Corporation is tabled at the meetings of the Investor Relations & Grievance Committee/board, on a quarterly basis, for their review and noting.

Website

Information regarding the Corporation can also be accessed on its website, www.hdfc.com.

The ‘Corporate Governance’ section on the website of the Corporation contains statement on corporate governance, �� '� �� J�� J�� attendance of each director thereat and at the 35th�<�+��#� �� with the Stock Exchanges, code of conduct as applicable to directors and senior management of the Corporation �� [ ��_�¡�� + ��^��z{^��

The ‘Investor Relations’ section on the website of the Corporation contains information relating to the ISD, the various

169


�� Z�� dividends, warrants, debentures, announcements and answers to frequently asked questions.

Unclaimed Shares

Clause 5A of the listing agreements inter alia requires every listed company to comply with certain procedures in respect of shares issued by it in physical form pursuant to a public issue or any other issue and which remained unclaimed for any reason whatsoever.

Accordingly, as on April 1, 2012, 7,00,375 unclaimed equity shares of ` 2 each of the Corporation in respect of 512 folios were lying in HDFC Unclaimed Suspense Account maintained with HDFC Bank Limited.

�� J��[�� year 2012-13 and shares lying unclaimed as on March 31, 2013, is detailed as under:

Sr.No.

Particulars No. of shareholders

No. of equity shares of ` 2 each

I Aggregate number of shareholders and the outstanding equity shares lying in the said Unclaimed Suspense Account as on April 1, 2012.

512 7,00,375

II Number of shareholders who approached the Corporation for transfer of equity shares from the said Unclaimed Suspense Account during the year ended March 31, 2013.

23 32,700

III Number of shareholders (out of the said 23 shareholders) to whom equity shares were transferred from the said Unclaimed Suspense <��

16 23,500

IV Aggregate number of shareholders and the outstanding equity shares lying in the said Unclaimed Suspense Account as on March 31, 2013. (I-III)

496 6,76,875

In terms of the said Clause, voting rights on the equity shares lying in the said Unclaimed Suspense Account shall �� Q�� on the said unclaimed shares viz. bonus shares, split, etc., if any, shall also be credited to the said Unclaimed Suspense Account.

The concerned shareholder(s) are requested to write to the ISD to claim the said equity shares. On receipt of such � ��[�� \�� [�� either transfer the said shares lying in the said Unclaimed Suspense Account to the depository account provided by �� ?@�� ]� �� the shareholder(s), to their address registered with the Corporation.

Dematerialization of Shares and Liquidity

!��#�� [�� %'$�� form. As on May 3, 2013, 98.83% of the total issued and paid-up equity share capital of the Corporation is held by 1,76,895 shareholders in electronic form and the balance 1.17% is held by 12,539 shareholders in physical form.

Pursuant to Circular No. CIR/MRD/DP/22/2012 dated August 27, 2012, issued by SEBI and to encourage shareholding in electronic form, the Corporation sent letters to shareholders holding shares in physical form, requesting them to consider converting the same into electronic form.

170

Distribution of Shareholding

Details of shareholding based on category, holding and location as on May 3, 2013, are given below:

According to Category:

Category Physical form Electronic form Total

No. of share-

holders

No. of shares

No. of share-

holders

No. of shares No. of share-

holders

No. of shares % to capital

Resident Individuals

12,436 1,74,90,121 1,69,619 13,34,89,413 1,82,055 15,09,79,534 9.76

Foreign Institutional Investors (FIIs) - - 1,077 114,28,91,738 1,077 114,28,91,738 73.87

Foreign Direct Investment (FDI) - - 7 50,18,563 7 50,18,563 0.32

Insurance Companies 1 500 24 12,65,27,116 25 12,65,27,616 8.18

Domestic Companies/Trusts 81 5,85,735 2,180 4,57,37,331 2,261 4,63,23,066 2.99

Mutual Funds 4 4,750 282 3,97,66,532 286 3,97,71,282 2.57

Financial Institutions/Banks 5 7,100 61 3,05,05,466 66 3,05,12,566 1.97

Non-resident Indians (NRIs) 12 13,000 3,325 27,59,572 3,337 27,72,572 0.18

Clearing Members (in the depository) - - 320 23,96,553 320 23,96,553 0.16

Total 12,539 1,81,01,206 1,76,895 152,90,92,284 1,89,434 154,71,93,490 100.00

According to Holding:

No. of shares held Physical form Electronic form Total

No. of shareholders

No. ofshares

No. ofshareholders

No. ofshares

No. of shareholders

No. of shares

% to capital

Upto 100 538 47,260 1,06,113 34,36,364 1,06,651 34,83,624 0.23

101 - 500 3,043 11,85,178 30,638 85,96,767 33,681 97,81,945 0.63

501 - 1,000 3,951 38,03,843 14,123 1,21,78,884 18,074 1,59,82,727 1.03

1,001 - 2,500 3,881 73,68,750 16,323 2,91,65,673 20,204 3,65,34,423 2.36

2,501 - 5,000 917 31,76,325 5,148 1,85,48,227 6,065 2,17,24,552 1.41

5,001 - 10,000 154 10,83,725 1,857 1,33,25,901 2,011 1,44,09,626 0.93

10,001 - 50,000 48 8,25,475 1,453 3,25,03,205 1,501 3,33,28,680 2.15

50,001 - 1,00,000 5 3,97,250 329 2,37,29,129 334 2,41,26,379 1.56

1,00,001 and above 2 2,13,400 911 138,76,08,134 913 138,78,21,534 89.70

Total 12,539 1,81,01,206 1,76,895 152,90,92,284 1,89,434 154,71,93,490 100.00

Category (%)

Resident Individuals 9.76

Foreign Institutional Investors (FIIs ) 73.87

Foreign Direct Investment (FDI) 0.32

Insurance Companies 8.18

Domestic Companies/Trusts 2.99

Mutual Funds 2.57

Financial Institutions/Banks 1.97

Non-resident Indians (NRIs) 0.18

Clearing Members (in the depository) 0.16

Shareholding Pattern(As on May 3, 2013)

171


According to Location:

City* No. ofshareholders

% to totalshareholders

No. ofshares

% tocapital

Mumbai 59,056 31.18 144,45,57,428 93.37Pune 12,042 6.36 89,09,249 0.58Delhi 8,845 4.67 1,35,33,464 0.87Bengaluru 8,393 4.43 1,06,07,319 0.69Ahmedabad 7,652 4.04 61,93,230 0.40Chennai 7,030 3.71 73,33,773 0.47Kolkata 6,842 3.61 1,02,39,828 0.66Vadodara 5,005 2.64 41,61,191 0.27Hyderabad 3,890 2.05 23,53,174 0.15Surat 1,770 0.93 9,15,760 0.06Ghaziabad 1,516 0.80 9,11,350 0.06Nagpur 1,495 0.79 8,88,391 0.06Dombivli 1,402 0.74 5,50,986 0.04Jaipur 1,285 0.68 10,39,535 0.07Nashik 1,265 0.67 6,90,113 0.04Lucknow 1,252 0.66 6,60,681 0.04Indore 1,193 0.63 7,91,656 0.05Rajkot 1,140 0.60 7,69,069 0.05Other cities 58,361 30.81 3,20,87,293 2.07Total 1,89,434 100.00 154,71,93,490 100.00

�� !"��"�� "��#��"� �� "��considered.

Major Shareholders

Details of shareholders holding 1% or more of the total issued and paid-up share capital of the Corporation as on May 3, 2013, are given below:

Sr.No.

Name of the shareholder No. ofshares held

% to capital

1 %�� Q�� 7,16,31,730 4.632 Oppenheimer Developing Markets Fund 4,35,77,079 2.823 Life Insurance Corporation of India 3,47,27,934 2.254 Aberdeen Global Indian Equity (Mauritius) Limited 3,10,00,000 2.005 ICICI Prudential Life Insurance Company Ltd. 3,09,62,699 2.006 Virtus Emerging Markets Opportunities Fund 2,49,06,564 1.617 Aberdeen Global-Emerging Markets Equity Fund 2,45,69,215 1.598 Vanguard Emerging Markets Stock Index Fund, A Series of Vanguard International Equity Inde X Fund 2,38,01,556 1.549 Government of Singapore 2,31,23,104 1.5010 Carmignac Gestion A/C Carmignac Patrimoine 1,90,48,406 1.2311 The Aberdeen Emerging Markets Institutional Fund 1,89,99,000 1.2312 Abu Dhabi Investment Authority - Gulab 1,88,80,986 1.2213 Blackrock Fund Advisors A/C Ishares Emerging Markets Index Mauritius Co. 1,70,13,698 1.1014 Stichting Pensioenfonds ABP 1,64,30,504 1.0615 SBI Life Insurance Co. Ltd 1,55,61,247 1.0116 Vontobel Fund A/C Vontobel Fund Emerging Markets Equity 1,55,47,756 1.01 Total 42,97,81,478 27.80

172

Stock Market Price Data

!�� '�%� �� /�%� �� 2012-13, are as under:

Month BSE NSE

High (`)

Low (`)

No. of shares traded

High (`)

Low (`)

No. of shares traded

April–12 694.00 661.00 11,84,576 692.25 663.85 3,46,38,693

May–12 684.00 610.70 26,79,057 677.30 610.50 6,98,58,858

June–12 664.80 633.30 11,61,277 664.90 629.95 4,34,56,143

July–12 695.30 652.25 50,46,236 696.95 652.10 5,06,63,586

August–12 738.80 684.00 62,64,278 739.10 684.35 9,36,96,474

September–12 785.00 718.00 34,00,297 785.45 718.10 6,00,69,655

October–12 793.85 732.85 2,76,33,546 794.00 631.25 11,28,93,906

November–12 848.00 757.00 34,49,599 849.90 758.00 5,54,06,398

December–12 882.00 820.00 28,80,084 882.30 820.00 4,30,63,400

January–13 850.15 783.50 26,67,716 850.90 784.55 4,86,84,318

February–13 828.70 751.10 25,63,195 828.40 750.00 4,68,27,472

March–13 837.95 760.00 24,29,679 838.55 756.00 5,56,32,567

Source: www.bseindia.com and www.nseindia.com

Share Price Movement on the BSE during 2012-13 Share Price Movement on the NSE during 2012- 13

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173


HDFC share price versus the BSE – Sensex(Both rebased to 100)

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174

OTHER IMPORTANT INFORMATION

Share Price History

!�� Q[��#�� #��'�%�� z{{��? �\��]�� ` 10 per equity share to ` 2 per equity share in August 2010) and BSE-Sensex and NSE-Nifty on the said dates.

Date HDFC Share Price on BSE

(`)

% of appreciation

BSE – Sensex % of appreciation

NSE - Nifty % of appreciation

April 1, 2003 66.10 1,153.86 3,037.54 521.91 977.40 482.91

April 1, 2004 129.00 542.48 5,599.12 237.39 1,771.45 221.62

April 1, 2005 149.26 455.27 6,506.60 190.33 2,035.90 179.84

April 3, 2006 268.00 209.25 11,342.96 66.54 3,403.15 67.41

April 2, 2007 296.00 180.00 12,811.93 47.45 3,820.00 49.15

April 1, 2008 482.00 71.95 15,771.72 19.78 4,735.65 20.31

April 1, 2009 285.00 190.81 9,745.77 93.84 3,023.85 88.41

April 1, 2010 547.00 51.52 17,555.04 7.61 5,249.20 8.54

April 1, 2011 694.95 19.26 19,463.11 (2.94) 5,835.00 (2.36)

April 2, 2012 670.00 23.70 17,429.96 8.38 5,296.35 7.57

April 1, 2013 828.80 18,890.81 5,697.35

(` in crores)

40,171

78,014

0

20000

40000

60000

80000

100000

120000

140000

20132012201120102009

102,858 99,444

127,767

Paid-up share capital ` 309.27 crores as on March 31, 2013(154,63,47,255 equity shares of ` 2 each)

Market Capitalization(`)

118

264

129

294

162

360

0

100

200

300

400

201320122011

Value

Book Value including appreciation in value of listed investments

Book Value Per Share

Face value: ` 2 per equity share

(`)

24

28

32

0

5

10

15

20

25

30

35

201320122011

Earnings Per Share

Face value: ` 2 per equity share

175


Equity History

Particulars No. of shares issued (of ` 2 each)

Year/date

Initial Issue 5,00,00,000 1978

Public cum Rights Issue 5,00,00,000 1987

Public cum Rights Issue 12,50,00,000 1990

Rights Issue of Fully Convertible Debentures 23,62,50,000 1992

Private Placement to Financial Institutions 4,50,00,000 1993

Private Placement to Foreign Investors 8,93,20,000 1995

Allotment under ESOS 1,42,33,565 Between March 2001 and November 2002

Bonus Issue (1:1) 60,98,03,565 December 30, 2002

Allotment under ESOS 1,34,78,475 Between January 2003 and March 2004

Allotment under ESOS 1,25,18,055 During Financial Year 2004-05

Allotment under ESOS 22,16,005 During Financial Year 2005-06


Allotment on a preferential basis 7,62,50,000 July 11, 2007 - CMP Asia Limited

Allotment on a preferential basis 1,37,50,000 July 24, 2007 - Citigroup Strategic Holdings Mauritius Limited


Allotment pursuant to Conversion of FCCB 5,96,67,050 During Financial Year 2007-08


Allotment pursuant to Conversion of FCCB 11,71,775 During Financial Year 2008-09


Allotment pursuant to Conversion of FCCB 31,24,730 During Financial Year 2009-10

Allotment pursuant to Conversion of FCCB 1,41,55,105 During Financial Year 2010-11(upto July 29, 2010)



Allotment pursuant to exchange of Warrants 59,900 During Financial Year 2011-12

Allotment pursuant to exchange of Warrants 5,46,83,250 During Financial Year 2012-13(upto September 6, 2012)


Allotment under ESOS 8,46,235 Between April 1, 2013 to May 3, 2013

Total: (as on May 3, 2013) 154,71,93,490

Note: The nominal face value of the equity shares of the Corporation was sub-divided from ` 100 per equity share to ` 10 per equity share, with effect from August 25, 1999 and thereafter from ` 10 per equity share to ` 2 per equity share, with effect from August 21, 2010. Accordingly, for ease of comparison, all issues have been represented by equity shares of ` 2 each.

176

Legal Proceedings

�� [�� J � �� shares. The Corporation is not in agreement with the claims made by the concerned shareholders and the said litigations are not material in nature.

As at March 31, 2013, there was no litigation against the Corporation or any of its managing/whole-time directors, �� $��¢$$$��[�� <��^_�|�

Secretarial Compliance

The Corporation has complied with the applicable provisions of the Companies Act, 1956, the Rules framed thereunder, the SEBI Act, 1992, rules, regulations and guidelines issued thereunder and the listing agreements. In this connection, +��/��'� �� <�� year ended March 31, 2013 and their report is given elsewhere in the annual report.

Control of the Corporation

The Corporation is neither owned nor controlled, directly or indirectly, by any person, entity or government and does not owe allegiance to any promoter or promoter group. To the best of its knowledge and belief, the Corporation does not have any arrangement, the operation or consequence of which might directly or indirectly result in a change in its ownership, control or management.

Further, during the year under review, the Corporation has not received any disclosure under Regulation 30 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

Voting Rights

All the equity shares issued by the Corporation carry equal voting rights, with an exception, where voting rights in respect of the outstanding equity shares lying in the Unclaimed Suspense Account shall remain frozen till the rightful owner claims such shares, in terms of Clause 5A of the listing agreements.

�� ¡��hands operates on the principle of ‘One Member-One Vote’. If majority of members raise their hands in favour of a particular resolution, it is taken as passed, unless a poll is demanded.

The fundamental voting principle in a company, in case voting takes place by a poll, is ‘One Share-One Vote’. On a �� Z�� Z�� /��has been demanded at any general meeting of the members of the Corporation. No business has been transacted through postal ballot.

Unclaimed Dividend

Dividends not encashed or claimed, within seven years from the date of its transfer to the unpaid dividend account, will, in terms of the provisions of Section 205A of the Companies Act, 1956, be transferred to the Investor Education and Protection Fund (IEPF) established by the Central Government. In terms of the provisions of Section 205C of the Companies Act, 1956, no claim shall lie against the Corporation or the IEPF after the said transfer.

In order to reduce the quantum of unclaimed dividends, during the year, the Corporation has sent reminder letters, contacted those shareholders who have written to ISD for other services and dispatched duplicate dividend warrants �� z{{�]{|�� !�� [�� unclaimed dividend to the shareholders having a bank account with HDFC Bank Limited or whose 9 digit MICR code is made available to it by the depositories and dispatches duplicate dividend warrants directly to the concerned banks wherever the bank details are made available by the depositories.

The Corporation has uploaded the information relating to unclaimed dividends and unclaimed matured deposits along with interest accrued thereon, on its website and on the website of the IEPF, in terms of the IEPF (Uploading

177


�� @�`��z{^z�?$%�Q�`��@��the Ministry of Corporate Affairs (MCA) on May 10, 2012.

!�� #�� z{{�]{|��z{^{]^^�� z{{�]{|��z{^^]^z�� said websites and lodge their claim with the Corporation, before the same is due for transfer to the IEPF.

The details of the unclaimed dividends and the last date for claiming the same, prior to its transfer to the IEPF, are as under:

Financial Year No. of Members who have not claimed their

dividend

Unclaimed dividends as on

March 31, 2013 (`)

Unclaimed dividends as % to

total dividend

Date of declaration

Last date for claiming the dividend prior to

its transfer to IEPF

2005-06 1,631 65,19,480 0.13 July 18, 2006 August 24, 2013

2006-07 1,955 86,55,746 0.16 June 27, 2007 August 4, 2014

2007-08 2,510 1,07,88,750 0.15 July 16, 2008 August 22, 2015

2008-09 2,711 1,41,37,080 0.17 July 22, 2009 August 28, 2016

2009-10 3,139 1,85,29,200 0.18 July 14, 2010 August 20, 2017

2010-11 4,372 2,44,98,540 0.19 July 8, 2011 August 8, 2018

2011-12 4,029 3,29,57,716 0.20 July 11, 2012 August 10, 2019

As per the provisions of Section 205C of the Companies Act, 1956, unclaimed dividends amounting to ` 52,39,239 �� z{{�]{�� $%�Q��z{^z�

Q�� z{{�]{|� �� shareholder on or before August 24, 2013, as it is liable to be transferred to the IEPF within a period of 30 days from the said date. In terms of the said section, no claim would lie against the Corporation or the IEPF after the said transfer.

Re-validation of Dividend Warrants

!��`'$�� <��^��z{^z�� #��?@J�� ?@�� only for a period of 3 months from the date of its issue. Accordingly, shareholders are requested to kindly encash at par cheque(s)/demand draft(s) issued by the Corporation, before the expiry of the said validity period, failing which the concerned shareholder is requested to return the same to the Corporation, to facilitate its re-validation.

Issue of Duplicate Dividend Warrants

In case the original dividend warrant is reported as lost/misplaced, a duplicate dividend warrant may be issued by ��[�� #�� ?@� ��\��

Dispatch of documents in electronic form (Green Initiative)

As part of its ‘Green Initiative’, the MCA vide Circular Nos. 17/2011 and 18/2011 dated April 21, 2011 and April 29, z{^^�� 53 and 219(1) of the Companies Act, 1956, in case documents like notice, annual report, etc., are sent in electronic form to its members.

Further, in terms of Clause 32 of the listing agreements which were amended vide Circular No. CIR/CFD/DIL/7/2011 dated October 5, 2011 issued by SEBI, listed companies are required to supply soft copies of the said documents to all members who have registered their e-mail address(es) for the said purpose.

178

Accordingly, the said documents will be sent by e-mail to those members who have registered their e-mail address(es) with their DP/the Corporation, in terms of the said Clause.

Members who have not registered their e-mail address are requested to register the same with their DP in case shares are held in electronic form or with the Corporation in case shares are held in physical form and support the green initiative of the MCA.

However, in case any member who has registered his e-mail addresses with the Corporation/DP, but who wishes to receive a physical copy of the said documents, is requested to write to [email protected], duly quoting his DP ID and Client ID or his Folio number, as the case may be.

Please note that the said documents will also be uploaded on the website of the Corporation viz. www.hdfc.com and �� `��"��[��

Documents

AR Main 2012-13_0.pdf · Marketing and Distribution During the year, ... HDFC Bank and a few third party direct selling associates (DSAs). Besides local and regional DSAs, tie-ups