Bafl Annual Report 2009-10

8/6/2019 Bafl Annual Report 2009-10

1/57

Bajaj Auto Finance Limited23rd Annual Report 2009-10


2/57


3/57

Bajaj Auto Finance Limited | 1

23rd Annual General Meeting

on Wednesday, 21 July 2010 at 12 noon

at the Registered Oce o the Company

Chie Executive OicerRajeev Jain

Company SecretaryAnant Damle

Auditors

Dalal & Shah

Chartered Accountants

Bankers

Central Bank o India

State Bank o India

IDBI Bank Limited

Syndicate Bank

Registrar & Transer Agent

Karvy Computershare Private LimitedPlot No.17 to 24,Vittalrao Nagar, Madhapur,Hyderabad 500 081

Registered Oice

C/o Bajaj Auto Limited,Mumbai-Pune Road,

Akurdi, Pune 411 035.

Corporate Oice

Bajaj Finserv 4th Floor,Survey # 208/1-B,Viman Nagar, Pune 411 014

Board o Directors

Rahul Bajaj

Chairman

Nanoo Pamnani

Vice Chairman

Madhur Bajaj

Rajiv Bajaj

Sanjiv Bajaj

D S Mehta

D J Balaji Rao

Dipak Poddar

Ranjan Sanghi

Rajendra Lakhotia

Corporate Inormation


4/57


5/57


on 9 February 2007 or a tenor o three years became due orredemption on 9 February 2010. The company has redeemedthese debentures on the due date.

Employee Stock Option Scheme

Pursuant to the authority given by the members o the companyvide special resolution passed through postal ballot on 15December 2009, and subject to the provisions o the Securitiesand Exchange Board o India (Employee Stock Option Schemeand Employee Stock Purchase Scheme) Guidelines 1999, theRemuneration & Nomination Committee o the Board o Directorsmade on 12 January 2010 a rst grant o 132,000 options underthe companys Employee Stock Option Scheme, 2009 (ESOP 2009),as per the terms and conditions o the ESOP Scheme. As requiredunder the SEBI Guidelines, the details o the options granted aregiven in the annexure to this report.

Fixed Deposits

The company renewed xed deposits o Rs.10.1 million. PublicDeposits outstanding at the year end were Rs.24.5 million and thenumber o depositors was 794. At the end o the nancial yearunder review, there were 128 deposits aggregating Rs. 2.2 millionwhich matured but remained unclaimed as on that date. Thecompany had written to these depositors and as on date, depositsaggregating Rs. 0.1 million have been repaid / renewed.Credit Rating

Despite a tough economic environment, the company managedto retain all its credit ratings owing to high capital adequacy,strong promoter support, tightened credit acceptance criteria and

robust asset-liability management.

CRISIL has re-armed the highest rating o FAAA/Stable or theFixed Deposit programme o the company. This rating indicatesvery strong degree o saety with regard to timely payment ointerest and principal. The company is one o the very ew Non-Banking Finance Companies (NBFCs) which enjoys the highestrating.

The company also enjoys the highest rating o P1+ rom CRISILand A1+ rom ICRA or Short Term Debt programme.

The Long Term Non-Convertible Debentures have been assignedAA+/Stable rating by CRISIL indicating high degree o saety with

regard to timely payment o interest and principal and high creditquality rating o LAA+ with stable outlook by ICRA.

The company has also been assigned AA+/ Stable rating byCRISIL and LAA+ with stable outlook by ICRA or Rs. 200 CroresLower Tier II Bond programme.

As regards the Bank Loan Ratings or the bank acilities stipulatedby RBI, as a part o BASEL II guidelines, CRISIL has assignedAA+ / Stable rating or the companys Cash Credit / Working

Capital Demand Loan amounting to Rs.9,850 million and Long Term

Bank acilities amounting to Rs.4,010 million and P1+ rating or

the Short Term Bank acilities amounting to Rs.8,050 million.

RBI Guidelines

The company continues to ulll all the norms and standardslaid down by the Reserve Bank o India (RBI) pertaining to non-perorming assets, capital adequacy, statutory liquidity ratio etc.As against the RBI norm o 12 per cent, the capital adequacy ratio

o the company is 26 per cent.

In line with the RBI guidelines or Asset-Liability Management(ALM) system or NBFCs, the company has an Asset-Liabilitycommittee which meets periodically to review its ALM risks andopportunities.

Statutory Disclosures

As required under the provisions o Section 217(2A) o theCompanies Act, 1956, read with the Companies (Particulars oEmployees) Rules, 1975, as amended, particulars o employeesare set out in the Annexure to the Directors Report. As per theprovisions o Section 219(1)(b)(iv) o the said Act, these particulars

will be made available to any shareholder on request.

The company, being a Non-Banking Finance Company, not havingany manuacturing activity, the directors have nothing to reporton Conservation o Energy or Technology Absorption. Foreigncurrency expenditure amounting to Rs.4.5 million was incurredduring the year under review. The company did not have anyoreign exchange earnings.

Directors Responsibility Statement

In compliance o Section 217(2AA) o the Companies Act, 1956,the directors state that :

(i) in the preparation o the annual accounts, theapplicable accounting standards have been ollowedalong with proper explanation relating to materialdepartures;

(ii) the directors have selected such accounting policies andapplied them consistently and made judgments andestimates that are reasonable and prudent so as to give a trueand air view o the state o aairs o the company at theend o the nancial year and o the prot o the companyor that period;

(iii) the directors have taken proper and sucient care or the

maintenance o adequate accounting records in accordancewith the provisions o the Companies Act, 1956 orsaeguarding the assets o the company and or preventingand detecting raud and other irregularities;

(iv) the directors have prepared the annual accounts on a goingconcern basis.

Directors

Shri Nanoo Pamnani, Shri Rajiv Bajaj and Shri Dipak Poddar,directors, retire rom the Board by rotation this year and beingeligible, oer themselves or re-appointment.


6/57

4 | Bajaj Auto Finance Limited

The inormation on the particulars o directors seekingre-appointment as required under Clause 49 o the ListingAgreement with the Stock Exchanges has been given under thereport on Corporate Governance.

Auditors Report

The observations made in the Auditors Report read with therelevant notes thereon are sel-explanatory and hence do not callor any urther comments under Section 217 o the CompaniesAct, 1956.

Auditors

You are requested to appoint auditors or the period rom theconclusion o the ensuing Annual General Meeting till theconclusion o the next Annual General Meeting and to x theirremuneration.

Group

Pursuant to an intimation rom the Promoters, the names o thePromoters and entities comprising group as dened underthe Monopolies and Restrictive Trade Practices (MRTP) Act,1969 are disclosed in the Annual Report or the purpose o the

SEBI (Substantial Acquisition o Shares and Takeovers)Regulations, 1997.

Corporate Governance

The company complies with all the mandatory requirements

pertaining to Corporate Governance, in terms o the revisedClause 49 o the Listing Agreement with the Stock Exchanges.A detailed report on Corporate Governance has been includedin this report along with a certicate rom the auditors o thecompany regarding compliance o conditions o CorporateGovernance. Further, a separate Management Discussion andAnalysis report is also given in this report.

On behal o the Board o Directors

Rahul BajajChairman

Pune: 11 May 2010


7/57


Inormation regarding the Employee Stock Option Plan 2009, as on 31 March 2010, in terms o Regulation 12 and 19 o SEBI (EmployeeStock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999

1. Options granted during the year 132,000

2. Pricing ormula Options are convertible into 132,000 equity shares oRs.10/-each at an exercise price o Rs.358.70 per Share

3. Options vested Nil. Options would vest not earlier than one year andnot later than ve years rom the date o grant.

4. Options exercised Nil

5. Total number o shares arising as a result o exercise o option N.A.

6. Options lapsed Nil

7. Variation o terms o options Nil

8. Money realized by exercise o options N.A.

9. Total number o options in orce Nil

10. Employee wise details o options granted :

(i) Senior Managerial PersonnelSr. No. Name o the employee No. o Options granted1. Rajeev Jain 39,0002. Pankaj Thadani 14,2503. Vivek Likhite 14,2504. Deepak Reddy 14,2505. Devang Mody 12,0006. Amit Gainda 14,250

(ii) Any other employee who receives a grantin any one year o option amounting to 5%or more o options granted during the year Nil

11. Identied employees who were granted optionsduring any one year, equal to or exceeding 1%

o the issued capital ( excluding outstandingwarrants and conversions)o the company atthe time o grant Nil

12. Diluted Earnings Per Share (EPS) pursuant toissue o shares on exercise o options calculatedin accordance with Accounting Standard (AS) 20Earning Per Share

13. Where the company has calculated the employee Had compensation cost or the stockcompensation cost using the intrinsic value o the option plans outstanding beenstock options, the dierence between the employee determined based on air valuecompensation cost so computed and the employee approach, the net prot and earningscompensation cost that shall have been recognized per share would have been as per thei it had used the air value o the options, shall be proorma amounts indicated below:disclosed.The impact o this dierence on prots &on EPS o the company shall also be disclosed

Particulars 31 March 2010(Amount in Rs.)

Net prot (as reported) 894,076,602

Add: Stock based employee compensation expense included in net income

Less: Stock based compensation expense determined under air value based method (pro orma) 13,364,340

Net Prot (pro orma) 880,712,262

Basic Earnings per share (as reported) 24.43

Basic Earnings per share (pro orma) 24.07

Diluted earnings per share (as reported) 24.43

Diluted earnings per share (pro orma) 24.07

Annexure to the Directors Report


8/57


14. Weighted average exercise prices andweighted-average air value o options shallbe disclosed separately or options whoseexercise price either equals or exceeds

or is less than the market price o the stock 15. A description o the method and signicant The company has elected to use intrinsic value method

assumptions used during the year to to account or the compensation cost o stock optionsestimate the air value o options , to employees o the company. Intrinsic value is theincluding the ollowing weighted average amount by which the quoted market price o theinormation : underlying share exceeds the exercise price o the option.

The company issued grants on 12 January 2010 atRs. 358.70 which was the closing price o the previous dateon the stock exchange with the highest tradingvolume or the day. The air value o options used to computeproorma net prot and earnings per share have beenestimated on the date o grant using the Black Scholes Model.

i) Risk-ree interest rate 6.70%

ii) Expected lie 1 -5 years

iii) Expected volatility 54.01%

iv) Expected dividend yield 0.62%

v) The price o the underlying share in market atthe time o option grant Rs. 358.70

Annexure to the Directors Report (Contd.)


9/57


2009-10 started o amidst an uncertain economic environmentdriven by ears o a global double-dip recession, low domesticindustrial growth, the ailure o monsoons aecting the kharicrop and weak consumer demand.

Things changed or the better in the second hal. Stabilisationo the global nancial system, three substantive governmentstimulus packages, an accommodative monetary stance by theReserve Bank o India (RBI) and the emphasis on public sectorexpenditure in the rst (mid-term) budget o the new

government saw a resurgence o growth in H2 2009-10,especially in January-March 2010.

These measures resulted in improved business condenceand revival o consumer demand. A relatively benign interestrate environment throughout the second hal o 2009-10 alsohelped. Even so, it needs stating that retail lending in 2009-10was weak compared to a couple o years ago. Having aced risingdelinquencies and higher credit risks in 2008-09 and most o2009-10, lending institutions remained cautious across all retaillending businesses.

Despite a muted market or all o 2008-09 and hal o

2009-10, Bajaj Auto Finance Limited (BAFL or the Company)sees signicant growth opportunities in the uture. Given lowpenetration o retail lending to GDP, demographic shits in avouro a younger working population, higher incomes o a rapidlygrowing middle class, and a preerence or younger householdsto live with greater gearing, BAFL sees major retail lendingopportunities in India.

With receivables under nancing o Rs.40.3 billion, BAFL is one othe leading, diversied non-banking nance companies (NBFC) inthe country. The companys restructuring over the last two yearshas started to bear results in 2009-10. Additionally the companycontinued to invest in launching new product lines, expanding itstechnology platorm and strengthening its human resources pool

or higher growth in the coming years.

The loan book has improved qualitatively. The companyincreased its write os and provision or bad and doubtul debtsarising out o weak loan servicing perormance in the past ocertain customer segments . Instead o going purely by RBIprudential norms, BAFL proactively took the decision to increaseprovisioning by Rs. 210 million or a business line closed in early2009. With this additional provisioning, the loan book lookshealthier and positions the company or aster and more ocusedgrowth in the uture.

Highlights or 2009-10

Given below are BAFLs perormance highlights or 2009-10.

l Total income or 2009-10 was up by 53% to Rs.9.16 billionl Prot ater tax was up 164% to 894 million.l Deployment during the year rose by 87% to Rs.45.85 billion.l Receivables under nancing as on 31 March 2010 were up by

59% to Rs.40.3 billion.l Loan losses and provisions or the year increased by 59% to

Rs.2.61 billion.l Capital adequacy ratio as on 31 March 2010 stood at 26%

well above the RBI norm.

Deployment Snapshot

Table 1 gives the deployment mix or 2009-10 (compared to2008-09), while Chart A plots BAFLs loan deployment overthe last ve years.

Table 1: BAFLs Deployment Mix (Rs. millions)

Deployment 2009-10 2008-09 Change

Two and Three-Wheelers 13,643.6 7,827.6 74%

Consumer Durables 10,374.7 6,548.2 58%

Small Business Loans and Personal Loan Cross-Sell 9,512.9 5,563.1 71%

Mortgage and Other Secured Assets 11,772.6 3,210.8 267%

Securitized retail asset pools 547.2 1,359.6 (60%)

Total Deployment 45,851.0 24,509.3 87%

Management Discussion

and Analysis

Chart A: Growth in BAFLs Loan Deployment (Rs. millions)

50,000

45,000

40,000

35,000

30,000

25,000

20,000

15,000

10,000

5,000

02005-06 2006-07 2007-08 2008-09 2009-010

19,545

26,313 30,363

24,509

45,851

n Deployment CAGR (23.8%)


10/57


Receivables under Finance

Table 2 gives the data o BAFLs receivables under nance.

Table 2: BAFLs Receivables under FinanceRs. Million

Receivables Under Finance 2009-10 2008-09 %change

Two & Three Wheelers 13,880 11,748 18%

Consumer durables 4,259 3,203 33%

Small business loans & Personal loan cross sell 9,946 5,431 83%

Mortgage & other secured assets 11,613 2,674 334%

Securitized retail asset pools 560 2,332 (76%)

Total Receivables under nance 40,258 25,389 59%

Business Segment Update

Two- Wheeler Financing

Two wheeler deployments grew by 74% in 2009-10, thanks tostrong growth in two-wheeler demand throughout the country.

The competitive environment was benign with most competitorshaving exited the business in the last two years.

BAFL has leveraged this opportunity to consolidate its positionin the Bajaj two- wheeler nancing business. Its penetration as apercentage o sales o Bajaj two-wheelers was at 23% in 2009-10,versus 20% in the previous year. The company acquired morethan 378,000 new customers during the year. Today, it ispresent in 375 dealerships, and accesses over 900 sub-dealersacross India. Moreover, the companys new underwritingprocess o deploying credit sales managers in dealerships

has begun to improve credit perormance and deliver bettercustomer experience.

During 2009-10, the two-wheeler nancing business launched anew programme called the Direct Cash Collection Model toocus on semi-urban and rural customers with no bankinghabits. The programme will integrate mobile technology andBajaj Auto Limiteds sub-dealer network to create a uniquebusiness model.

Consumer Durables Financing

Consumer durable nancing deployments grew by 58% in2009-10, versus an estimated industry growth o 30%.

Competition remained limited, because ew are willing to investin technology and processes to compete in this relatively lowticket size, high volume business. The company acquired morethan 470,000 new customers and is currently present in over 2,000dealerships across the country.

BAFLs strategy o ocusing on mass auent customers andmajor dealerships has begun to yield signicant benetsthrough lower operating costs and improved risk perormance.During the year, the company added a new tool to its currenttechnology platorm to improve customer experience andtarget mass auent customers. It also invested in automationo the loan approval process at 100 top dealerships throughout

the country. This programme to provide a seamless nancingexperience has set a new benchmark in the consumer durablenancing business.

Small Business Loans

This business is present in the top 15 cities across India. Small businessloan deployments grew by 175%. This was partly due to a lowbase eect, a more ocused small business initiative and a portolioacquisition in 2009-10. Its core small business loan grew by 66%.

The companys strategy o ocusing on auent small businesscustomers and its cautious approach has helped it to grow thisbusiness in a steady manner. BAFLs relationship model o lendinghas also helped in signicantly improved risk perormance.Recently, as an extension to its small business loan programme ithas launched nancing o vendors to large manuacturers.

Personal Loan Cross-Sell

This business targets customers with good repayment history ortheir two-wheeler and/or consumer durables loans to cross-sell apersonal loan. BAFL continued to grow this business in a cautiousmanner. Given the economic circumstances, it is not surprising

that the personal loan cross sell deployments contracted by 23%in 2009-10. Even so, BAFL nanced some 46,000 new customers inthe current year.

In 2009-10, the company implemented a new customerrelationship management (CRM) platorm to improve its datamining, and thus oer better business generation capabilities.

This should stand BAFL in good stead or 2010-11 and the uture.

Mortgage Business

This was the rst ull year o mortgage business. It targets auentand high net worth small business customers and oers loans

against the mortgage o retail, residential and commercial premises.Aided by strong revival in the mortgage business in the second hal2009-10, the portolio increased in line with the industrys growth.

This business is present in the top 15 cities o India.

Financial Perormance

Table 3 gives BAFLs nancial perormance or 2009-10 comparedwith 2008-09, while Chart B plots the companys prots ater taxover the last ve years.

Table 3: BAFLs Financial Perormance, 2008-09 and 2009-10Rs. Million

Particulars 2009-10 2008-09 Change

Total income 9,162 5,994 53%

Interest and nance charges 2,017 1,644 23%

Net interest income 7,145 4,350 64%

Salary cost 994 729 36%

Marketing and other commissions 252 261 -3%

Dealer incentives 260 111 134%

Recovery commission 561 463 21%

Loan loss and provisions 2,606 1,636 59%

Depreciation 76 56 36%

Other expenses 1,053 584 80%

Prot beore tax (PBT) 1,343 510 163%

Prot ater tax (PAT) 894 339 164%

Earnings per share (EPS), basic and diluted, Rs. 24.43 9.27 164%

Book value per share (Rs.) 314.93 297.5 6%


11/57


Chart B clearly shows that 2009-10 has been an excellent year orBAFL one in which the company has earned its highest everprot ater tax.

Chart C plots the companys net owned unds.

Risk Management and Portolio quality

As a NBFC, the company is exposed to credit risk, liquidity

risk and interest rate risk. BAFL recognises the importance o

risk management. It has invested in people, processes and

technologies to efectively mitigate risks posed by external

environment and by its borrowers. It has also put in place a

strong risk management team, an efective credit operations

structure, has invested in credit analytics, increased credit

bureau usage and invested in technology up-grades to

manage its risks.

In the current year, BAFL urther strengthened its risk rameworkby investing in a data warehouse and risk analytics technologyplatorm. This implementation will also help improvingcross-selling.

The companys Asset-Liability Committee (ALCO), set up in linewith the guidelines issued by the RBI, monitors asset-liabilitymismatches, to ensure that there are no imbalances or excessiveconcentrations on either side o the balance sheet.

Internal Control Systems and Their Adequacy

BAFL has an independent internal audit unction to evaluate the

adequacy o all its internal controls. It ensures that all unctions,

including business and support units, adhere to clearly laid downinternal processes and procedures as well as to the prescribedregulatory and legal ramework. The internal audit departmentreviews and ensures that the audit observations are acted upon.

The Audit Committee o the Board o Directors reviews theinternal audit reports and the adequacy and eectiveness o

internal controls.

Fulilment o RBI Norms and Standards

BAFL continues to either ull or exceed all norms and standardslaid down by the RBI pertaining to recognition and provisioning onon-perorming assets, capital adequacy, statutory liquidity ratioetc. The capital adequacy ratio o the company is 26%, which iswell above the RBI norm o 12%.

Human Resources

BAFL continues to lay emphasis on its most valuable resource:its people. In an increasingly competitive market or human

resources, the company puts great emphasis on attracting andretaining the right talent.

During 2009-10, BAFL took up a number o initiatives to build uphuman resources. These were strengthening the managementstructure, aligning compensation packages in line with theindustry standards and introducing an Employee Stock OptionPlan (ESOP).

In 2009-10, the company conducted an employee engagementsurvey using a leading external HR rm to evaluate and improveemployee engagement. It also introduced a new Employee SelService (ESS) portal to advance its employee engagement.

During the year, BAFL added 531 permanent employees takingthe total employee strength to 2,265.

Outlook

The economy is predicted to continue the strong perormanceseen in 2009-10 and the business outlook or BAFL is robust.

In 2010-11, the companys approach would be to continue togrow by ocusing on returns while balancing risk. It will launchnew product lines, such as construction equipment nance andretail loans against securities; urther strengthen risk managementpractices; maintain investments in technology and human

resources to consolidate its position as a leading NBFC in India.

Cautionary Statement

Statements in this Management Discussion and Analysis describing

the companys objectives, projections, estimates and expectations

may be a orward looking statement within the meaning o

applicable laws and regulations. Actual results might difer materially

rom those either expressed or implied.

14,000

12,000

10,000

8,000

6,000

4,000

2,000

2005-06 2006-07 2007-08 2008-09 2009-010

4,827

9,95910,634

10,887

11,525

Chart C: BAFLs Net Owned Funds (Rs. Million)

Chart B: Prot after Tax (Rs. Million)

1,000

900800

700

600

500

400

300

200

100

02005-06 2006-07 2007-08 2008-09 2009-010

376.9

472.2

201.2

339.2

894.0

n PAT CAGR (24.1%)


12/57


Brie statement on the companysphilosophy on code o governance

The company strongly believes in air, ecient and transparentbusiness operations, airness to all stakeholders in the company,proper disclosure o relevant nancial and non-nancialinormation and enhancing shareholder value on acontinuing basis.

Board o Directors

Composition and Category o Directors

The Board consists o ten directors, all o whom are

non- executive directors and ve o them i.e., 50% areindependent. According to revised Clause 49 o theListing Agreement with the Stock Exchanges, where thenon- executive Chairman is a promoter o the company or isrelated to any promoter, at least one-hal o the Board o thecompany shall consist o independent directors. Thisprovision is thus met by the company.

Name o Director Executive / Non-executive / No. o other No. o other Board

Independent Directorships Committee positions held

held (in public

ltd. companies)As Chairman As Member

Shri Rahul Bajaj Chairman, Non-executive 7

Shri Nanoo Pamnani Vice-Chairman, Non-executive, 3 4 1

Independent

Shri Madhur Bajaj Non-executive 5

Shri Rajiv Bajaj Non-executive 5 1

Shri Sanjiv Bajaj Non-executive 10 4

Shri D S Mehta Non-executive, Independent 4 1 4

Shri D J Balaji Rao Non-executive, Independent 9 4 6

Shri Dipak Poddar Non-executive 7 4

Shri Ranjan Sanghi Non-executive, Independent 7 1 2

Shri Rajendra Lakhotia Non-executive, Independent 3

Notes :

1. Private limited companies, oreign companies and companies under section 25o the Companies Act, 1956 are excluded or the above purposes.

2. Only audit committee and shareholders grievance committee are considered

or the purpose o committee positions as per listing agreement.

Attendance o each director at the Board Meetings andat the last AGM :

Name o Director No. o Board Meetings Whether presentattended during 2009-10 at the last AGM ?

Shri Rahul Bajaj 4 Yes

Shri Nanoo Pamnani 4 Yes

Shri Madhur Bajaj 4 Yes

Shri Rajiv Bajaj 4 Yes

Shri Sanjiv Bajaj 4 Yes

Shri D S Mehta 3 Yes

Shri D J Balaji Rao 4 Yes

Shri Dipak Poddar 2 No

Shri Ranjan Sanghi 4 Yes

Shri Rajendra Lakhotia 3 Yes

Number o Board meetings held during2009-10 and the dates on which held

Four Board Meetings were held during the year 2009-10. Thedates on which the meetings were held are as ollows:

20 May 2009, 15 July 2009, 14 October 2009 and 12 January 2010.

The gap between any two meetings has been less than ourmonths, thus complying with the Clause 49 requirement.

Code o Conduct

The Board has laid down a code o conduct or all Board Membersand senior management o the company, which has been postedon the website o the company. All the Board members and seniormanagement personnel have armed compliance with the Codeor the year ended 31 March 2010. A declaration to this eectsigned by the CEO is given elsewhere in this Annual Report.

Brie Resume o Directors oering orre-appointment

Shri Nanoo Pamnani, Shri Rajiv Bajaj and Shri Dipak Poddar,directors are retiring by rotation, and are eligible orre-appointment. Their brie particulars are as ollows :

Corporate Governance


13/57


Shri Nanoo Pamnani, 65, is B.A.(Hons.) rom Bombay Universityand B.Sc. (Economics) rom London School o Economics.Between 1982 to 1985, Shri Pamnani was Chie Executive Ocero Citibank, N.A. India with responsibilities covering Corporateand Investment Banking in India and oversight over businessesin Sri Lanka, Bangladesh and Nepal. Between 1985 to 1989, he

was Chie Executive Ocer o Citibank, N.A. based in Manilaand was involved in the country debt rescheduling process.During 1989 to 1995, Shri Pamnani was with Citibank N.A asBusiness Head or Private Banking businesses across Asia Pacic,excluding Japan and was based in Singapore. In 1995, he becameDirector o Operations and Technology o citibank N. A. or over70 countries including Emerging Markets (Asia, Latin America,Central and Eastern Europe and Middle East and Arica) and wasbased in London. In 1998, he became Chie Executive Ocero Citibank N.A., India with responsibilities covering Corporateand Investment Banking and Consumer Banking and RegionalHead or India, Sri Lanka, Bangladesh and Nepal. In 2002, hewas appointed to the position o Chairman, Citibank N.A, Indiain a non-executive capacity. From 2004 to December 2006, as

Director o Citibank, N.A. Asia pacic Group, based in Singapore,he ocused on bank acquisitions and establishing new Centreso Excellence or Sotware and business processing across AsiaPacic. Shri Pamnani retired rom Citigroup with eect rom31 December 2006 and has now relocated to Mumbai, India.

He holds directorships in the ollowing public limited companiesapart rom Bajaj Auto Finance Ltd.:

l Bajaj Auto Ltd.l Bajaj Holdings and Investment Ltd.l Bajaj Finserv Ltd.

He is also a member o the Audit Committee o all o the abovementioned companies and Shareholders and Investors GrievanceCommittee o all these companies exceptBajaj Auto Ltd.

He does not hold any shares in the company.

Shri Rajiv Bajaj, 43, is a B.E. (Mech) First Class with distinction romUniversity o Pune and M.Sc. with distinction in ManuacturingSystems Engineering rom University o Warwick, U.K. He has beenin the erstwhile Bajaj Auto Limited (BAL) in dierent capacitiessince 19 December 1990. As President and later as Joint ManagingDirector, he has led a major technological reorientation o thecompany, so as to meet the existing and uture competitive

challenges. He became the Managing Director o the erstwhileBAL on 1 April 2005 and remained as such until 20 February 2008,i.e. the eective date or the scheme o demerger o erstwhileBAL. He then became the Managing Director o the new BAL witheect rom 20 February 2008.

He has received numerous prestigious awards and recognitionsrom reputed authorities and organisations, notable ones beingWorld Economic Forum, Indian Institute o Materials Management,

The Indian Express, Economic Times and NDTV Prot.

He holds directorships in the ollowing public limited companiesapart rom Bajaj Auto Finance Ltd. :

l Bajaj Auto Ltd.l Bajaj Auto Holdings Ltd.l Bajaj Finserv Ltd.l

Bajaj Holdings & Investment Ltd.l Bajaj Financial Solutions Limited


Shri Dipak Poddar,67 is B.Sc.(Hons.), SB & SM (MIT), educated atMassachusetts Institute o Technology, USA and has experienceo over three decades in nance, automobiles, garment exports,precision engineering and other areas.

He was the Managing Director o the company rom April 1987 toMarch 2008.

He holds directorships in the ollowing public limited companies

apart rom Bajaj Auto Finance Ltd. :

l Poddar Developers Ltd.l Suvijay Exports Ltd.l VIP Industries Ltd.l GTL Ltd.l Bajaj Allianz General Insurance Co. Ltd.l Makara Real Estates Ltd.l Brite Merchants Ltd.


Audit Committee

The terms o reerence o the Audit Committee apart rom thosespecied in the Listing Agreement with the Stock Exchangesbroadly pertain to review o business practices, review oinvestment policies, review o compliances and review o systemsand controls etc.

The Audit Committee consists o our Non- executive Directorsviz., Shri Nanoo Pamnani as Chairman o the Committee andShri Sanjiv Bajaj, Shri D S Mehta and Shri Ranjan Sanghi as othermembers. In addition to the Audit Committee members, the CEO,CFO, Head o Internal Audit unction and the Statutory Auditorsattend the meetings. The Company Secretary acts as the Secretaryto the Audit Committee.

The Audit Committee met our times during 2009-10, on20 May 2009, 15 July 2009, 14 October 2009 and 12 January 2010.

The gap between any two meetings is less than our months, thuscomplying with the Clause 49 requirement.

Shri Nanoo Pamnani, Shri Sanjiv Bajaj and Shri Ranjan Sanghi werepresent or all the our meetings.

Shri D S Mehta was present or three meetings.


14/57


Remuneration Committee

The terms o reerence o the Remuneration Committee in briepertain to determining the companys policy on and approvespecic remuneration packages or executive directors atertaking into account nancial position o the company, trend in the

industry, appointees qualication, experience, past perormance,past remuneration, interest o the company and shareholders.

During the year under review, the Remuneration Committeewas restyled as Remuneration and Nomination Committee withadditional terms o reerence. The Committee met once duringthe year on 12 January 2010. All the members o the Committeewere present at the meeting.

The Remuneration and Nomination Committee consists o veNon-executive Directors viz., Shri Nanoo Pamnani as Chairman othe Committee and Shri Rahul Bajaj, Shri Sanjiv Bajaj, Shri RanjanSanghi and Shri Rajendra Lakhotia as members.

Remuneration o Directors during 2009-10

Amount in Rs.

Name o Director Sitting Fees Salaries and perquisites Commission Total

Shri Rahul Bajaj 100,000* 100,000

Shri Nanoo Pamnani 200,000* 4,600,000 4,800,000

Shri Madhur Bajaj 80,000 80,000

Shri Rajiv Bajaj 80,000 80,000

Shri Sanjiv Bajaj 180,000* 180,000

Shri D S Mehta 140,000* 140,000

Shri D J Balaji Rao 80,000 80,000

Shri Dipak Poddar 40,000 40,000

Shri Ranjan Sanghi 200,000* 200,000

Shri Rajendra Lakhotia 80,000* 80,000

Notes:

1. The Sitting Fee was paid to the directors @ Rs.20,000/- per meeting o the

Board / Committee attended by them.

2. *Also includes Sitting Fees or attending Committee Meetings.

Shares held by Non-executive Directors

The Non-executive Directors who held shares in thecompany are :

Name o Director Number o Shares held as on 31 March 2010

Shri Rahul Bajaj 16,000

Shri Madhur Bajaj 16,000

Shri Rajendra Lakhotia 92,234

Shareholders/ Investors Grievance Committee

The Shareholders / Investors Grievance Committee is headedby Shri Nanoo Pamnani, a non-executive director. The otherMembers o the Committee are Shri Ranjan Sanghi andShri D S Mehta.

The Committee met once during the year on 20 May 2009. All theMembers were present at the meeting.The Secretarial Auditor alsoattends its meetings.

Name and designation o Compliance Ocer :Shri Anant Damle, Company Secretary.

29 Shareholder complaints were received during the year 2009-10and all o them have been attended to.

Number o pending Share Transers as on 31 March 2010 : Nil

General Body Meetings

(i) Location and time, where last three Annual GeneralMeetings held :

Location Date & Time

20th Annual General Meeting Registered Ofce o the 11 July 2007 3.30 p.m.Company at Mumbai PuneRoad, Akurdi, Pune 411 035

21st Annual General Meeting -do- 9 July 2008 11.30 a.m.

22nd Annual General Meeting -do- 15 July 2009 11.30 a.m.

(ii) Special Resolutions passed in the previous three AnnualGeneral Meetings :

In the 21st Annual General Meeting held on 9 July 2008, twoSpecial Resolutions were passed, pertaining to :

(a) Appointment and remuneration payable to Shri RajeevJain as Manager with the designation o Chie ExecutiveOcer or a term o three years with eect rom 1 April2008 and

(b) Payment o Commission to Non-Executive Directors

In the 22nd Annual General Meeting held on 15 July 2009,

Special Resolution was passed to incorporate new articles inthe Articles o Association o the company.

(iii) Special Resolutions passed through Postal Ballot or :

(a) Alteration in the Objects Clause o the Memorandumo Association pursuant to Section 17 o the CompaniesAct, 1956,

(b) commencement o the new businesses pursuant toSection 149(2A),

(c) Introduction o Employee Stock Option Scheme orpermanent Employees o the company pursuant toSection 81(1A) and

(d) extending the benets o the resolution to the employees

o the Holding or Subsidiary Companies within the overallceiling o 5% o the Paid-up Equity Share Capital othe company.

Details o voting pattern o Postal Ballot

Sr. No. Particulars Votes in avour Votes against

1. Special Resolution under Section 17 96.58% 0.02%

2. Special Resolution under Section 149 (2A) 96.49% 0.02%

3. Special Resolution under Section 81(1A) 99.95% 0.02%

4. Special Resolution under Section 81(1A) 99.85% 0.02%

(iv) Person who conducted the Postal Ballot Exercise:Shri Shyamprasad D. Limaye was appointed as Scrutinizer to


15/57


receive and scrutinize the postal ballot orms received romthe members and or conducting the Postal Ballot process in aair and transparent manner.

(v) No resolution is proposed to be passed through postal ballotat this Annual General Meeting.

(vi) Procedure or Postal Ballot :

(a) For Special Resolution dated 30 September 2009 :The Postal Ballot process commenced rom 15 July2009. The despatch o Postal Ballot orms along with theNotice and Explanatory Statement to all the MembersUnder Certicate o Posting was completed on 18 August2009. The last date or receiving Postal Ballot Forms bythe Scrutinizer was 17 September 2009. The Scrutinizersubmitted his report about the results o the Postal Ballotto the Chairman and the Chairman declared the results on30 September 2009.

(b) For Special Resolution dated 15 December 2009 :The Postal Ballot process commenced rom14 October 2009. The despatch o Postal Ballot ormsalongwith the Notice and Explanatory Statement toall the Members Under Certicate o Posting wascompleted on 5 November 2009. The last date orreceiving Postal Ballot Forms by the Scrutinizerwas 5 December 2009. The Scrutinizer submitted hisreport about the results o the Postal Ballot to theChairman and the Chairman declared the results on15 December 2009.

The entire Postal Ballot process was carried out pursuant

to Section 192A (1) o the Companies Act, 1956 read withthe Companies (Passing o Resolution by Postal Ballot) ,Rules 2001.

Subsidiary Companies

The company does not have any subsidiary companies.

Disclosures

l Disclosures on materially signicant related party transactionsi.e., transactions o the company o material nature withits promoters, the directors or the management, theirsubsidiaries or relatives etc., that may have potential confict

with the interests o the company at large :

None o the transactions with any o the related parties werein confict with the interest o the company.

A statement in summary orm o transactions with relatedparties is placed periodically beore the Audit Committee.

l

Details o non-compliance by the company, penalties,strictures imposed on the company by Stock Exchangesor SEBI or any statutory authority, on any matter related tocapital markets, during the last three years : None

l Disclosure o Accounting Treatment : In the preparation onancial statements, the company has ollowed the treatmentas prescribed in the Accounting Standards.

l Risk Management : The company has a dened Risk

Management ramework. The company has laid downprocedures to inorm the Board members about the riskassessment and minimization procedures.

CEO / CFO Certiication

The CEO and the CFO appointed or the purpose o Clause 49have given the necessary certicate to the Board in theprescribed ormat.

Means o Communication

The quarterly, hal-yearly and annual nancial results arepublished in The Economic Times (all editions), Financial Express(all editions), Indian Express (Pune edition), Maharashtra Times(Pune edition) and Loksatta (Pune edition).

The hal-yearly nancial results are sent to the household oeach shareholder.

The fnancial results, shareholding pattern, code o conduct etc., are

also put on the companys web-site, www. bajajfnservlending.in

or the beneft o the public at large. Ocial news releases are sent

to the stock exchanges.

As per the Electronic Data Inormation Filing And Retrieval(EDIFAR) system introduced by SEBI, various documents likenancial results, shareholding pattern etc., are led on SEBIsocial web-site, www.sebi.gov.in.

Management Discussion and Analysis report is given in a separate

section included in this annual report.


16/57


Compliance o mandatory andnon-mandatory requirementsunder clause 49

Mandatory

The company has complied with all the mandatory requirementso clause 49 o the Listing Agreement.

Non-mandatory

The company has also complied with the non-mandatoryrequirements as under:

The Board

The non-executive Chairman has an oce at thecompanys premises. All independent Directors o thecompany, except Shri Ranjan Sanghi and Shri Rajendra Lakhotiahave tenures not exceeding a period o nine years on the board.

The Board believes that their continuation on the Board is in the

companys interest.

Remuneration Committee

The company has a remuneration committee. A detailed note onthis committee is provided in the Corporate Governance Report.

Shareholder rights

A hal-yearly declaration o nancial perormance including

summary o signicant events in the preceding six months is sentto each household o shareholders.

Audit qualifcations

There are no qualications in the nancial statements o thecompany or the year 2009-10.

Whistle Blower Policy

The company has a Whistle Blower Policy. This policy is toenable employees to report to the management their concernsabout unethical behaviour, actual or suspected raud or violationo companys code o conduct or ethics policy. This mechanismprovides saeguards against victimisation o employees, whoavail o the mechanism. The policy has been appropriately

communicated to the employees within the organisation.

Declaration on Code o Conduct

As required by Clause 49(1)(D) o the Listing Agreement with the Stock Exchanges, it is hereby declared that all the Board members andsenior management personnel have armed compliance with the Code o Conduct o the company or the year ended 31 March 2010

Place : Pune Rajeev JainDate : 30 April 2010 Chie Executive Ocer


17/57


23rd Annual General Meeting

Date : 21 July 2010 Time : 12 noonVenue : Regd. Oce o the company at

C/o. Bajaj Auto Ltd.,Mumbai - Pune Road, Akurdi, Pune - 411 035.

Financial Calendar

The nancial year o the company is 1 April to 31 March.- Unaudited results or the quarter ending

30 June 2010 and 23rd Annual

General Meeting 21 July 2010

- Unaudited results or the quarter / hal year Mid / Second hal o

ending 30 September 2010 October 2010

- Unaudited results or the quarter / nine Mid / Second hal o

months ending 31 December 2010 January 2011

- Audited results or the year ending Mid / Second hal o

March 2011 May 2011

Dates o Book Closure

10 July 2010 to 21July 2010 (both days inclusive)

Dividend Payment Date

On or ater 26 July 2010, but within the statutory time limit.

Listing on Stock Exchanges

Bombay Stock Exchange Ltd. National Stock Exchange o India Ltd.

Phiroze Jeejeebhoy Towers, Exchange Plaza,

Dalal Street, Bandra-Kurla Complex,

Mumbai - 400 001. Bandra (E),

Mumbai - 400 051.

(Stock Code : 500034) (Stock Code : BAJAUTOFIN - EQ)

Annual Listing Fees as prescribed have been paid to the aboveStock Exchanges upto 31 March 2011.Demat ISIN :Equity Shares INE296A01016

Market Price Data (on BSE) during eachmonth in last inancial year

Month BSE NSEHigh (Rs.) Low (Rs.) High (Rs.) Low (Rs.)

April 2009 98.90 68.00 100.00 68.50

May 2009 139.05 90.00 138.80 89.00

June 2009 188.20 147.05 187.40 146.05

July 2009 200.00 135.20 198.00 136.10

August 2009 224.75 185.00 224.50 183.20

September 2009 248.00 200.00 245.00 200.55

October 2009 335.95 238.00 336.25 239.95

November 2009 308.00 250.10 320.00 253.15

December 2009 333.90 282.00 334.00 284.00

January 2010 380.00 300.55 377.40 304.00

February 2010 336.60 283.00 348.00 275.55

March 2010 334.90 295.00 330.00 302.00

Registrar and Transer Agent

The company has appointed Karvy Computershare Private Limited(Karvy) as the Share Transer Agent or physical segment. Karvyalso acts as the depository registrar or establishing connectivitywith NSDL and CDSL or demat segment.

General Shareholder

Inormation

Performance in comparison to BSE Sensex

Bajaj Auto Finance Limiteds Stock Performance vs BSE Sensex600

500

400

300

200

100

0

31-Mar-09

30-Apr-09

30-Jun-09

31-May-09

31-Jul-09

31-Aug-09

31-Jan-10

28-Feb-10

31-Mar-10

31-Oct-09

30-Sep-09

30-Nov-09

31-Dec-09

BSE

BAFL


18/57


Shareholders are requested to send their share transer andother requests to Karvy Computershare Private Limited at theollowing address :

Karvy Computershare Private Limited

Unit : Bajaj Auto Finance Limited

Plot No.17 to 24 Vittalrao NagarMadhapur, Hyderabad 500 081Phone No 040-44655000, 040-44655152,Fax No. 040-44655024E-mail : [email protected]

Share Transer System: Share transers in physical orm areregistered and returned well within the stipulated period o 30days rom the receipt, i the documents are clear in all respects.

The total number o shares transerred in physical orm during theyear 2009-10 was 7,980, compared to 6,290 in 2008-09.

Distribution o Shareholdingas on 31 March 2010

Range o No. o % to total No. o % to totalHolding Shares holders Shareholders Shares held Shares

1 - 100 9746 71.35 681458 1.86

101 - 500 3057 22.38 695715 1.90

501 - 1000 366 2.68 290786 0.79

1001 - 10000 390 2.86 1247586 3.41

10001 - 50000 67 0.49 1338208 3.66

50001 - 100000 15 0.11 1024041 2.80

100001 and above 18 0.13 31318282 85.58

Total 13659 100.00 36596076 100.00

Shareholding Pattern as on 31 March 2010

Category No. o % to totalShares held Shares

Promoter & Promoter Group 18486979 50.52

Resident Individuals 4391213 12.00

Domestic Companies 2366531 6.47

Financial Institutions/Banks/Mutual Funds 2848725 7.78

Foreign Institutional Investors 6555262 17.91

Foreign Corporate Bodies 1656000 4.53

Non Resident Individuals/Overseas Corporate Bodies 253205 0.69

Others 38161 0.10

Total 36596076 100.00

Dematerialisation o shares and liquidity

The Equity Shares o the company are compulsory traded indematerialised orm by all the investors. The company hasentered into agreements with both the depositories viz., NationalSecurities Depository Ltd (NSDL) and Central Depository Services(India) Ltd (CDSL), enabling the investors to hold shares o thecompany in electronic orm through the depository o

their choice.

The Equity Shares o the company are regularly traded on BombayStock Exchange Ltd., and National Stock Exchange o India Ltd.

Break-up o Shares in Physical and Dematsegment as on 31 March 2010

Segment No. o % to total No. o % to totalShareholders Shareholders Shares held Shares

Physical 3506 25.67 561656 1.53

Demat 10153 74.33 36034420 98.47

Total 13659 100.00 36596076 100.00

Permanent Account Number (PAN) orSecurity Transactions

The Shareholders, who are holding shares in the physical orm,are requested to urnish the attested copies o their PAN to KarvyComputershare Private Limited, the Registrar and Share TranserAgent . This is in view o the direction o SEBI, making PAN as the

sole identication number or all security transactions in line withthe KYC norms. Based on the said directives, the shareholders,holding physical shares are requested to produce the PANdocument as stated above, which shall orm a part o the detailso shareholders o the company.

Address or correspondence

Secretarial DepartmentBajaj Auto Finance Limited,Corporate Oce:Bajaj Finserv, 4th Floor,Survey # 208/1-B,

Viman Nagar, Pune - 411 014.Phone No. (020) 30405060Fax No. (020) 30405020/30E-mail id or Investor Grievances : [email protected]

Additional Inormation

l Report on relatives o Directors :Shri Rajiv Bajaj and Shri Sanjiv Bajaj, Directors are sonso Shri Rahul Bajaj, Chairman.

l The company, during the year under review, has notsanctioned any loan to any o the directors and there is nooutstanding towards loans to Directors as on date.

l None o the employees o the company is related to any o thedirectors o the company.

l From the date o the Balance Sheet till the date o this report,there is no signicant event which will have an impact on theperormance o the company during the year 2010-11.

l Prole o Fixed Deposits as on 31 March 2010 was as under:

Period o Deposit (months) No. o Amount % to TotalDepositors (Rupees) Deposits

36 794 2,44,81,000 100


19/57


1 ANANT BAJAJ

2 DEEPA BAJAJ

3 GEETIKA BAJAJ

4 KIRAN BAJAJ

5 KRITI BAJAJ

6 KUMUD BAJAJ

7 MADHUR BAJAJ

8 MINAL BAJAJ

9 NIMISHA BAJAJ

10 NIRAJ BAJAJ

11 NIRAVNAYAN BAJAJ

12 POOJA BAJAJ

13 RAHUL KUMAR BAJAJ

14 RAJIVNAYAN BAJAJ

15 RISHAB BAJAJ16 RUPARANI BAJAJ

17 SANJALI BAJAJ

18 SANJIVNAYAN BAJAJ

19 SHEFALI BAJAJ

20 SHEKHAR BAJAJ

21 SIDDHANT BAJAJ

22 SUNAINA KEJRIWAL

23 MANISH KEJRIWAL

24 ARYAMAN KEJRIWAL

25 NEELIMA BAJAJ SWAMY

26 ADITYA SWAMY

27 BACHHRAJ AND COMPANY PVT LTD

28 BACHHRAJ FACTORIES PVT. LTD.

29 BAJAJ ALLIANZ FINANCIAL DISTRIBUTORS LTD

30 BAJAJ ALLIANZ GENERAL INSURANCE COMPANY LTD.

31 BAJAJ ALLIANZ LIFE INSURANCE COMPANY LTD.

32 BAJAJ AUTO EMPLOYEES WELFARE FUNDS

33 BAJAJ AUTO FINANCE LTD.

34 BAJAJ AUTO HOLDINGS LTD

35 BAJAJ AUTO LTD.

36 BAJAJ ELECTRICALS LTD.

37 BAJAJ FINANCIAL SECURITIES LTD.

38 BAJAJ FINANCIAL SOLUTIONS LTD.

39 BAJAJ FINSERV LTD.

40 BAJAJ HOLDINGS & INVESTMENT LTD.

41 BAJAJ INTERNATIONAL PVT LTD.

42 BAJAJ SEVASHRAM PRIVATE LTD.

43 BARODA INDUSTRIES PVT LTD.

44 HERCULES HOISTS LTD.

45 HIND MUSAFIR AGENCY LTD.

46 JAMNALAL SONS PVT LTD.

47 KAMALNAYAN INVESTMENT & TRADING PVT LTD

48 MADHUR SECURITIES PVT LTD

49 MUKAND ENGINEERS LTD.

50 MUKAND LTD

51 NIRAJ HOLDINGS PVT LTD52 RAHUL SECURITIES PVT LTD

53 SANRAJ NAYAN INVESTMENTS PVT LTD

54 SHEKHAR HOLDINGS PVT LTD

55 SHISHIR HOLDINGS PVT LTD

56 THE HINDUSTAN HOUSING CO LTD

57 ANANT TRADING COMPANY

58 BACHHRAJ TRADING COMPANY

59 BAJAJ TRADING COMPANY

60 RISHABH TRADING COMPANY

61 ANANT TRUST

62 ARYAMAN TRUST

63 DEEPA TRUST

64 GEETIKA TRUST

65 KRITI TRUST

66 MINAL TRUST

67 NEELIMA TRUST

68 NIMISHA TRUST

69 NIRAVNAYAN TRUST

70 RISHABNAYAN TRUST

71 SANJALI TRUST

72 SIDDHANT TRUST

MRTP DisclosureCONSTITUENTS OF `GROUP AS DEFINED IN MRTP ACT, 1969 FOR THE PURPOSES OF SEBI (SAST)REGULATIONS, 1997

Persons constituting group within the denition o group as dened in the Monopolies and Restrictive Trade Practices Act, 1969, orthe purpose o Regulation 3(1)(e)(i) o the Securities and Exchange Board o India (Substantial Acquisition o Shares and Takeovers)Regulations, 1997, include the ollowing:

Note: Shareholdings o HUFs, are held in the names o the respective individuals in the capacity o Karta. Hence, HUFs are notseparately listed hereinabove.

Sr No Name o the Person / Entity Sr No Name o the Person / Entity


20/57


To the Members oBajaj Auto Finance Limited

We have reviewed the records concerning the companys compliance o the conditions o Corporate Governance as stipulated inClause 49 o the Listing Agreement entered into, by the company, with the Stock Exchanges o India, or the nancial year ended31 March 2010.

The compliance o conditions o Corporate Governance is the responsibility o the management. Our examination was limited toprocedures and implementation thereo, adopted by the company or ensuring the compliance o conditions o Corporate Governance.It is neither an audit nor an expression o the opinion on the nancial statements o the company.

We have conducted our review on the basis o the relevant records and documents maintained by the company and urnished to us orthe review and the inormation and explanations given to us by the company.

Based on such a review and to the best o our inormation and according to the explanations given to us, in our opinion, the companyhas complied with the conditions o Corporate Governance, as stipulated in Clause 49 o the Listing Agreement o the Stock Exchangeso India.We urther state that such compliance is neither an assurance as to the uture viability o the company, nor as to the eciency oreectiveness with which the management has conducted the aairs o the company.

For DALAL & SHAHFirm Registration Number: 102021WChartered Accountants

Anish AminPartnerMembership Number : 40451Mumbai : 11 May 2010

Certicate by the Auditors on Corporate Governance


21/57


1. We have audited the attached Balance Sheet o Bajaj AutoFinance Limited (the Company) as at 31 March 2010 andthe related Prot and Loss Account and Cash Flow Statementor the year ended on that date annexed thereto, which

we have signed under reerence to this report. Thesenancial statements are the responsibility o the companysManagement. Our responsibility is to express an opinion onthese nancial statements based on our audit.

2. We conducted our audit in accordance with the auditingstandards generally accepted in India. Those Standardsrequire that we plan and perorm the audit to obtainreasonable assurance about whether the nancial statementsare ree o material misstatement. An audit includesexamining, on a test basis, evidence supporting the amountsand disclosures in the nancial statements. An audit alsoincludes assessing the accounting principles used andsignicant estimates made by Management, as well as

evaluating the overall nancial statement presentation. Webelieve that our audit provides a reasonable basis or ouropinion.

3. As required by the Companies (Auditors Report) Order,2003, as amended by the Companies (Auditors Report)(Amendment) Order, 2004 (together the Order), issued bythe Central Government o India in terms o sub-section (4A)o Section 227 o the Companies Act, 1956 (the Act) andon the basis o such checks o the books and records o thecompany as we considered appropriate and according tothe inormation and explanations given to us, we give in theAnnexure a statement on the matters specied in paragraphs

4 and 5 o the Order.

4. Further to our comments in the Annexure reerred to inparagraph 3 above, we report that:

(a) We have obtained all the inormation and explanationswhich, to the best o our knowledge and belie, werenecessary or the purposes o our audit;

(b) In our opinion, proper books o account as required by lawhave been kept by the company so ar as appears rom ourexamination o those books;

(c) The Balance Sheet, Prot and Loss Account and Cash FlowStatement dealt with by this report are in agreement withthe books o account;

(d) In our opinion, the Balance Sheet, Prot and Loss Accountand Cash Flow Statement dealt with by this report complywith the accounting standards reerred to in sub-section(3C) o Section 211 o the Act;

(e) On the basis o written representations received rom thedirectors, as on 31 March 2010 and taken on record by theBoard o Directors, none o the directors is disqualied ason 31 March 2010 rom being appointed as a director interms o clause (g) o sub-section (1) o Section 274 othe Act;

() In our opinion and to the best o our inormation andaccording to the explanations given to us, the said

nancial statements together with the notes thereonand attached thereto give, in the prescribed manner,the inormation required by the Act, and give a true andair view in conormity with the accounting principlesgenerally accepted in India:

(i) in the case o the Balance Sheet, o the state o aairso the company as at 31 March 2010;

(ii) in the case o the Prot and Loss Account, o the protor the year ended on that date; and

(iii) in the case o the Cash Flow Statement, o the cash

fows or the year ended on that date.


Anish AminPartnerMembership Number: 40451Mumbai: 11 May 2010

Report o the Auditors to the Members


22/57


23/57


Annexure to the Auditors Report (Contd.)

10. According to the records o the company examined by us andthe inormation and explanation given to us, the company hasnot deaulted in repayment o dues to any nancial institutionor bank or debenture holders as at the balance sheet date.

11. In our opinion, the company has maintained adequatedocuments and records in the cases where the company hasgranted loans and advances on the basis o security by way opledge o shares, debentures and other securities.

12. In our opinion, the company has maintained proper recordso transactions and contracts relating to dealing or trading inshares, securities, debentures and other investments duringthe year and timely entries have been made therein.

13. In our opinion and according to the inormation andexplanations given to us, the company has not given anyguarantee or loans taken by others rom banks or nancial

institutions during the year.

14. In our opinion, and according to the inormation andexplanations given to us, on an overall basis, the term loanshave been applied or the purposes or which they wereobtained.

15. On the basis o an overall examination o the balance sheet othe company, in our opinion and according to the inormationand explanations given to us, there are no unds raised ona short-term basis which have been used or long-terminvestment.

16. The company has not made any preerential allotment oshares to parties and companies covered in the registermaintained under Section 301 o the Act during the year.

17. The company has created security or charge in respect odebentures issued and outstanding at the year-end. Thedetails o security are disclosed in Note no. 9 in Schedule 12 tothe nancial statements;

18. The company has not raised any money by public issuesduring the year.

19. During the course o our examination o the books andrecords o the company, carried out in accordance with thegenerally accepted auditing practices in India, and accordingto the inormation and explanations given to us, we haveneither come across any instance o material raud on or bythe company, noticed or reported during the year.

20. Considering the nature o the business conducted by thecompany, the other clauses, viz., (ii) and (xiii) o paragraph 4 othe Companies (Auditors Report) Order 2003, as amended by

the Companies (Auditors Report) (Amendment) Order, 2004,are not applicable in the case o the company or the currentyear, and hence in our opinion there is no matter which arisesto be reported in the aoresaid clauses o the order.


Anish Amin

PartnerMembership Number: 40451Mumbai : 11 May 2010


24/57


Annexure to te Auditors Report Contd.

10. According to te records o te company examined by us andte inormation and expanation given to us, te company asnot deauted in repayment o dues to any nancia institutionor bank or debenture oders as at te baance seet date.

11. In our opinion, te company as maintained adequatedocuments and records in te cases were te company asgranted oans and advances on te basis o security by way opedge o sares, debentures and oter securities.

12. In our opinion, te company as maintained proper recordso transactions and contracts reating to deaing or trading insares, securities, debentures and oter investments duringte year and timey entries ave been made terein.

13. In our opinion and according to te inormation andexpanations given to us, te company as not given anyguarantee or oans taken by oters rom banks or nancia

institutions during te year.

14. In our opinion, and according to te inormation andexpanations given to us, on an overa basis, te term oansave been appied or te purposes or wic tey wereobtained.

15. On te basis o an overa examination o te baance seet ote company, in our opinion and according to te inormationand expanations given to us, tere are no unds raised ona sort-term basis wic ave been used or ong-terminvestment.

16. Te company as not made any preerentia aotment osares to parties and companies covered in te registermaintained under Section 301 o te Act during te year.

17. Te company as created security or carge in respect odebentures issued and outstanding at te year-end. Tedetais o security are discosed in Note no. 9 in Scedue 12 tote nancia statements;

18. Te company as not raised any money by pubic issuesduring te year.

19. During te course o our examination o te books andrecords o te company, carried out in accordance wit tegeneray accepted auditing practices in India, and accordingto te inormation and expanations given to us, we aveneiter come across any instance o materia raud on or byte company, noticed or reported during te year.

20. Considering te nature o te business conducted by tecompany, te oter causes, viz., ii and xiii o paragrap 4 ote Companies Auditors Report Order 2003, as amended by

te Companies Auditors Report Amendment Order, 2004,are not appicabe in te case o te company or te currentyear, and ence in our opinion tere is no matter wic arisesto be reported in te aoresaid causes o te order.

For DALAL & ShAhFirm Registration Number: 102021WCartered Accountants

Anis Amin

PartnerMembersip Number: 40451Mumbai : 11 May 2010


25/57


Baance Seet as at 31 Marc2010 2009

Scedue Rupees Rupees Rupees

As per our attaced report o even date

For DAlAl & ShAhFirm Registration Number: 102021WCartered Accountants

Anis AminPartner

Membersip Number: 40451

Mumbai: 11 May 2010

Anant DameCompany Secretary

Rau BajajNanoo Pamnani

D S MetaD J Baaji RaoSanjiv BajajRanjan SangiRajendra lakotia

Rajiv Bajaj

Pune: 11 May 2010

CairmanVice Cairman

Directors

I. SOURCES OF FUNDS:

1. Sareoders Funds:

a Sare Capita 1 365,965,760 365,965,760

b Reserves and Surpus 2 11,159,439,071 10,521,407,830_____________ _____________

11,525,404,831 10,887,373,590

2. loan Funds:

a Secured loans 3 20,793,477,153 7,901,247,079

b Unsecured loans 4 11,474,113,661 8,212,824,219_____________ _____________

32,267,590,814 16,114,071,298_____________ _____________

Total 43,792,995,645 27,001,444,888

II. APPLICATION OF FUNDS:

1. Fixed Assets : 5

a Gross Bock 918,336,218 578,661,104

b Less: Depreciation 413,821,206 376,660,952_____________ _____________

c Net Bock 504,515,012 202,000,152

2. Investments 6 3,018,268,823 2,739,082,451

3. Deerred Tax Asset, net See Note No.10 692,252,747 505,821,394

4. Current Assets, loans and Advances: 7a Receivabes under nancing activity 40,258,084,636 23,704,202,723

b Cas and bank baances 225,062,524 417,904,525

c Oter current assets 246,897,371 224,185,267

d Oter oans and advances 3,280,606,536 2,370,335,630_____________ _____________

44,010,651,067 26,716,628,145_____________ _____________

Less: Current liabiities and Provisions: 8

a liabiities 1,748,806,994 1,304,057,087

b Provisions 2,683,885,010 1,858,030,167_____________ _____________

4,432,692,004 3,162,087,254_____________ _____________

Net Current Assets 39,577,959,063 23,554,540,891_____________ _____________

Total 43,792,995,645 27,001,444,888

Notes orming part o te Financia Statements 12


26/57


Prot and loss Account or te year ended 31 Marc2010 2009

Scedue Rupees Rupees Rupees

As per our attaced report o even date

For DAlAl & ShAhFirm Registration Number: 102021WCartered Accountants

Anis AminPartner

Membersip Number: 40451

Mumbai: 11 May 2010

Anant DameCompany Secretary

Rau BajajNanoo Pamnani

D S MetaD J Baaji RaoSanjiv BajajRanjan SangiRajendra lakotia

Rajiv Bajaj

Pune: 11 May 2010

CairmanVice Cairman

Directors

INCOME FROM:

Assets under Finance and Secured loans:Financing Carges 5,288,757,478 3,783,688,427

leasing Business:lease Rentas 836,404 4,510,768

Interest on oans 2,349,265,755 1,058,591,829____________ ____________7,638,859,637 4,846,791,024

Service and administration carges 457,736,096 248,358,706____________ ____________8,096,595,733 5,095,149,730

Oter operating income 9A 1,003,959,455 852,900,935Oter income 9B 61,016,242 45,831,718____________ ____________

9,161,571,430 5,993,882,383EXPENDITURE:

Expenses 10 5,725,552,741 3,784,356,058Interest and Finance Carges 11 2,016,652,229 1,643,464,340Depreciation See Note No.1B 76,407,710 55,693,481____________ ____________

7,818,612,680 5,483,513,879____________ ____________Prot beore Taxation 1,342,958,750 510,368,504

TaxationCurrent tax incuding Rs. 250,000/-or Weat tax, Previous year Rs. 200,000/- 657,000,000 395,000,000

Add: Fringe Benet Tax 8,000,000 Less: Deerred tax credit 208,022,542 231,779,037____________ ____________

448,977,458 171,220,963____________ ____________Prot or te year ater Taxation 893,981,292 339,147,541Prior Period Adjustments reating to earier years:expense/income

Taxation 95,310 ____________ ____________Prot or te year ater Taxation and Prior Period Adjustments 894,076,602 339,147,541

Baance brougt orward rom previous year 4,010,446 31,494,063Amount transerred rom Debenture Redemption Reserve See Note No.8 480,500,000 ____________ ____________Prot avaiabe or appropriations 1,378,587,048 370,641,604Appropriations:

Transerred to Reserve Fund in terms o Section 45IC1o te Reserve Bank o India Act, 1934 180,000,000 68,000,000

Transer to Debenture Redemption Reserve 183,000,000 Transerred to Genera Reserve 90,000,000 30,000,0Proposed Dividend 219,576,456 73,192,152Provision or Dividend Tax on Dividend 36,468,905 12,439,006____________ ____________Baance carried to Baance Seet 852,541,687 4,010,446

Notes orming part o te Financia Statements 12

Earnings per sare(Face vaue Rs.10/-Net Prot ater tax and prior period adjustments 894,076,602 339,147,541Basic EPS 24.43 9.27Diuted EPS 24.43 9.27


27/57


I) CASh FROM OPERATIONS:

A Prot beore taxation 1,342,958,750 510,368,504

B Adjustments:

Add:

i Depreciation 76,407,710 55,693,481

ii Provision or doubtu overdue instaments receivabe

under nancing activity, net 661,711,276 612,781,761

iii Provision or diminution in investment written o, net 4,588,936

iv loss on sae o assets, net 330,765

v Assets written o 7,995,134

vi Interest and nance carges 2,016,652,229 1,643,464,340____________ ____________

2,767,686,050 2,311,939,582____________ ____________

4,110,644,800 2,822,308,086

Less:

i Investment income incuded in above

Dividend 34,547 23,741

Interest on bonds 447,721 575,000

Interest on government and trust securities 9,597,000 13,207,761____________ ____________

10,079,268 13,806,502

ii Surpus on sae o assets, net 1,325,156

iii Provision or diminution in vaue o investments

written back, net 1,079,416____________ ____________

Total 10,079,268 16,211,074____________ ____________

CASh FROM OPERATIONS 4,100,565,532 2,806,097,012

____________ ____________

Carried over 4,100,565,532 2,806,097,012

2010 2009

Particuars Rupees Rupees Rupees

Cas Fow Statement or te nancia year 2009-2010


28/57


2010 2009

Particuars Rupees Rupees Rupees

Cas Fow Statement or te nancia year 2009-2010 Contd.

Brougt over 4,100,565,532 2,806,097,012

C Increase/ Decrease in Oter Current Assets:

i Oter Current Assets and loans and Advances 251,377,809 77,445,475______________ ______________

Total 251,377,809 77,445,475

Increase/ Decrease in Current liabiities:

i liabiities 106,435,061 94,977,985

ii Gain on debenture repurcase 39,755,012 34,777,586____________ ______________

Total 146,190,073 60,200,399

397,567,882 137,645,874______________ ______________

3,702,997,650 2,943,742,886

Less: Interest and nance carges paid 1,445,346,323 1,621,451,490

Less: Direct taxes paid 695,065,701 503,628,608

Add: Tax adjustments reating to earier years 95,310 ______________ ______________

1,562,680,936 818,662,788

D Increase/ Decrease in Receivabes under nancing activity 17,160,162,688 4,731,122,812______________ ______________

NET CASh FROM OPERATIONS 15,597,481,752 3,912,460,024

II) INVESTMENT ACTIVITIES:

i Increase/ Decrease in investment in securitized assets, net 1,684,423,191 1,195,795,717

ii Increase/ Decrease in oter investments, net 1,968,198,500 665,000,000

iii Capita Expenditure incuding eased assets 392,324,728 124,829,629

iv Sae Proceeds o Assets/Adjustments to gross bock 5,076,259 6,064,734____________ ______________

Total 671,023,778 412,030,822____________ ______________

v Investment Income:

Dividends 34,547 23,741

Interest on Debentures & Bonds 447,721 575,000

Interest on Government Securities 9,597,000 13,207,761____________ ______________

Total 10,079,268 13,806,502____________ ______________

NET CASh FROM INVESTING ACTIVITIES 660,944,510 425,837,324______________ _____________

Carried over 16,258,426,262 3,486,622,700


29/57


30/57


Scedues 1 to 12 annexed to and orming part o te Financia Statementsor te year ended 31 Marc 2010

As at31 Marc 2009

Rupees Rupees

Scedue 1 Sare Capita

As at31 Marc 2009

Rupees Rupees Rupees

Scedue 2 Reserves and Surpus

Autorised:50,000,000 Equity sares o Rs. 10 eac 500,000,000 500,000,000

Issued:

36,597,076 Equity sares o Rs. 10 eac 365,970,760 365,970,760

Subscribed & Paid up:36,596,076 Equity sares o Rs 10 eac

uy caed up and paid up 365,960,760 365,960,760

1,000 Add : Foreited Equity Saresamount paid up 5,000 5,000_____________ ____________

Total 365,965,760 365,965,760

Securities Premium Account:

Sare Premium 7,543,418,611 7,543,418,611

Reserve Fund in terms o Section 45IC1

o te Reserve Bank o India Act, 1934

As per ast Account 727,500,000 659,500,000

Set aside tis year 180,000,000 68,000,000___________ _____________

907,500,000 727,500,000

Debenture Redemption Reserve:

See Note No. 8

As per ast account 480,500,000 297,500,000

Set aside tis year 183,000,000___________ _____________

480,500,000 480,500,000 Transerred to te baance in Prot and loss Account 480,500,000

___________ _____________

480,500,000

General Reserve:

As per ast account 1,765,978,773 1,735,978,773

Set aside tis year 90,000,000 30,000,000___________ _____________

1,855,978,773 1,765,978,773

Surpus as per annexed Account

852,541,687 4,010,446_____________ _____________

Total 11,159,439,071 10,521,407,830

Reer Note No. 14 on Empoyee Stock Option Pan


31/57


Fixed Deposits 24,481,000 38,246,000Add: Interest accrued and due 1,181,318 2,472,092_____________ _____________

25,662,318 40,718,092loan rom a company 146,000,000Sort term oan rom banks 1,006,402,137 2,974,569,821Term oan rom banks 4,500,000,000

Sort term borrowing by issue o Commercia Papers 5,400,000,000 3,400,000,000Term oan - oters 1,350,000,0008.25% Non Convertibe debentures redeemabe at par on5 August 2011 See Note No.9 B 500,000,000 250,000,000Interest accrued and due 42,049,206 51,536,306______________ _____________

Total 11,474,113,661 8,212,824,219

Note: Negotiabe Commercia Papers aggregating Rs. 6,650,000,000/- were issued by way o Promissory Notes during te yearMaximum baance outstanding at any point o time during te period Rs. 6,650,000,000/-Previous year Rs. 5,150,000,000/-

As at31 Marc 2009


Scedue 3 - Secured loans

As at31 Marc 2009


Scedue 4 - Unsecured loans

From Banks, against ypotecation o assets under nance,book debts and oter receivabes :

Cas Credit 2,731,904,414 4,025,054,038Secured debentures - privatey paced Reer Note No.9 A 12,500,000,000 1,000,000,000- 5,248,365 Secured Redeemabe Non Convertibe Debentures o teace vaue o Rs. 500/- eac secured by ypotecation o book debtsand mortgage o immovabe property o te company. Redeemed on9 February 2010. 2,624,182,500

Less: - 2,186,380 debentures repurcased but notcanceed - to be reissued 1,293,940,000_____________ _____________

1,330,242,500Less: Cas in arrears 4,199,801_____________ _____________

1,326,042,699Sort term oans rom banks, against ypotecation o assetsunder nance, book debts and oter receivabes 5,550,000,000 1,550,000,000Interest accrued and due on bank oans 11,572,739 150,342_____________ _____________

Total 20,793,477,153 7,901,247,079

Scedue 5 - Fixed Assets

Particulars Gross Block at cost Depreciation Net Block

As at Additions Deductions As at As at Deductions For the As at As at As at31 March 2009 and 31 March 2010 31 March 2009 and Year (b) 31 March 2010 31 March 2010 31 March 2009

adjustments adjustments

Rupees Rupees Rupees Rupees Rupees Rupees Rupees Rupees Rupees Rupe es

(a) Includes cost o shares in co-operative society Rs. 250/-(b) See Note No. 1 B(c) See Note No. 1 B II(d) Represents share in undivided portion o land, on purchase o ofce premises

Assets relating to leasing business:

Plant and Machinery 176,440,231 176,440,231 176,440,231 176,440,231

Other assets:

Land (d) 14,851,301 14,851,301 14,851,301

Building (a) 1,323,207 287,862,850 289,186,057 605,048 4,251,416 4,856,464 284,329,593 718,159

Computers 189,397,948 33,330,869 21,453,422 201,275,395 124,099,541 19,763,828 35,297,963 139,633,676 61,641,719 65,298,407

Furniture and Fixtures and Equipments 120,722,769 37,805,629 26,330,176 132,198,222 61,133,599 16,398,906 16,036,807 60,771,500 71,426,722 59,589,170

Vehicles 22,000,611 4,914,960 4,866,016 22,049,555 7,686,476 3,084,722 4,288,572 8,890,326 13,159,229 14,314,135

Intangible assets:

Specialised sotware (c) 68,776,338 13,559,119 82,335,457 6,696,057 16,532,952 23,229,009 59,106,448 62,080,281

As at 31 March 2010 Total 578,661,104 392,324,728 52,649,614 918,336,218 376,660,952 39,247,456 76,407,710 413,821,206 504,515,012 202,000,152

As at 31 March 2009 Total 468,925,310 124,829,629 15,093,835 578,661,104 331,321,729 10,354,258 55,693,481 376,660,952 202,000,152


32/57


(A) Long Term:In Government and Trust Securities:

Quoted:547,085 6.6% Tax Free ARS Bonds o te ace vaue o Rs. 100 eac,received on conversion o UTI MIP 1999 incuding interestaccrued tereon 54,708,500

12.32% Government o India Stock, 2011o te ace vaue oRs. 10,000,000/- 11,202,533 11,202,533

@ 12.25% Government o India Stock, 2010 o te ace vaue oRs. 20,000,000/- 27,480,000 27,480,000

@ 11.83% Government o India Stock, 2014 o te ace vaue oRs. 50,000,000/- 63,677,500 63,677,500

___________ ___________102,360,033 157,068,533

___________ ___________

102,360,033 157,068,533 In ully paid equity sares:

Oter tan trade:Quoted:

90 Sares o TCFC Finance limited

@ 38,700 Sares o Rs.10 eac in Akai Impex limited 2,322,000 2,322,000

75 Sares o Rs.10 eac in Bajaj hodings andInvestments limited 19,646 19,646

@ 16,880 Sares o Rs.10 eac in Dai Ici Karkaria limited 1,688,000 1,688,000

50 Sares o Rs.10 eac in Reigare Tecnova limited 1,435 1,435

25 Sares o Rs.10 eac in ICICI Bank limited 1,320 1,320

@ 52 Sares o Rs.10 eac in Midwest leasing limited 450 450

@ 50 Sares o Rs.10 eac in Mazda Industriesand leasing limited 500 500

@ 50 Sares o Rs.10 eac in MCC Finance limited 1,665 1,665

@ 50 Sares o Rs.10 eac in Nagarjuna Finance limited 713 713

@ 100 Sares o Rs.10 eac in P l Finance and Investment limited 1,500 1,500

@ 75 Sares o Rs.10 eac in Bajaj Auto limited 7,685 7,685

@ 75 Sares o Rs.5 eac in Bajaj Finserv limited 7,441 7,441

@ 310 Sares o Rs.10 eac in Soutern Fues limited 31,000 31,000___________ ___________

4,083,355 4,083,355

___________ ___________

106,443,388 161,151,888

In Bonds:

Quoted:

* 11.50% Bonds o Industria Deveopment Bank o India 2010

55t Series o te ace vaue o Rs. 5,000,000/- 4,750,000___________ ___________

Carried over 106,443,388 165,901,888

Scedue 6 - Investments, at Cost Uness oterwise statedAs at

31 Marc 2009



33/57


Brougt over 106,443,388 165,901,888

In Mutual Funds:

Quoted:

@ 48397254.584 S232 Sundaram BNP

Paribas Money Fund Super Institutiona Growt 900,000,000_____________ _____________

900,000,000

In Securitised assets:

Unquoted:

100 Pass Troug Certicates representing securitisation

o oan receivabes troug SME Retai Poo II Trust o India

Bus Credit Services limited and India Bus Financia Services

limited baance o wic is redeemabe in parts in terms o

te scedue specied terein aggregating to Rs. Ni 530,638,329

100 Pass Troug Certicates representing securitisation o

oan receivabes troug Investment Veice or Structured

Transactions 1208 o ICICI Bank limited baance o wic is

redeemabe in part in terms o te scedue specied terein

aggregating to Rs. Ni 499,755,223

Less: Amortisation o premium on acquisition 2,744,360_____________ _____________

497,010,863

95 Pass Troug Certicates representing securitisation o

oan receivabes troug SME Retai Poo IV Trust o IndiaBus Financia Services limited baance o wic is

redeemabe in parts in terms o te scedue specied

terein aggregating to Rs. Ni 613,999,270

48 Pass Troug Certicates representing securitisation

o oan receivabes troug ClSS 14 Trust 2009 o DlF

Commercia Compexes limited baance o wic is

redeemabe in parts in terms o te scedue specied

terein aggregating to Rs. Ni 42,774,729_____________ _____________

1,684,423,191

_____________ _____________

106,443,388 2,750,325,079

Less : Provision or diminution in vaue o Investments 15,831,565 11,242,628_____________ _____________

Total (A) 90,611,823 2,739,082,451_____________ _____________

(B) Current:

Quoted:

In Certifcates o Deposits wit banks:

@ 20000 UCO Bank CD 02-09-2010 Face vaue Rs. 100,000/- 1,950,912,000 -

@ 10000 State Bank o Patiaa CD 03-09-2010

Face vaue Rs. 100,000/- 976,745,000 -_____________ _____________

Total (B) 2,927,657,000 -_____________ _____________ Total 3,018,268,823 2,739,082,451

Scedue 6 - Investments, at Cost Uness oterwise stated Contd.As at

31 Marc 2009



34/57


Te oowing investments ave been purcased and sod during te year:

Name o te und No. o units Purcase cost Sae proceeds

Rupees Rupees

Sundaram BNP Paribas Mutua Fund -Various scemes 48,397,244.58 900,000,000.00 900,324,261.55IDFC Mutua Fund -Various scemes 12,657,866,143.66 138,613,400,000.00 138,650,521,716.54

ICICI Prudentia Mutua Fund -Various scemes 4,908,253,171.21 84,903,326,197.00 84,953,693,181.40

Bira Sunie Mutua Fund -Various scemes 6,406,518,348.68 92,890,000,000.00 92,924,629,640.54

hDFC Mutua Fund -Various scemes 3,997,485,459.99 72,852,500,000.00 72,880,587,920.15

Reiance Mutua Fund -Various scemes 4,413,290,643.46 62,750,000,000.00 62,774,113,772.28

Fortis Mutua Fund -Various scemes 589,425,769.91 6,970,000,000.00 6,980,992,353.83

Kotak Mutua Fund -Various scemes 147,428,071.46 2,250,000,000.00 2,255,714,336.86

Deutsce Mutua Fund -Various scemes 296,757,284.78 3,500,000,000.00 3,509,695,390.10

Scedue 6 - Investments, at Cost Uness oterwise stated Contd.

Book Vaue as at Market Vaue as at

31 Marc 2010 31 Marc 2009 31 Marc 2010 31 Marc 2009

Rupees Rupees Rupees Rupees

Quoted 3,018,268,823 * 1,054,659,260 * 3,018,483,553 * 1,054,875,385

Unquoted 1,684,423,191

Total 3,018,268,823 2,739,082,451 3,018,483,553 1,054,875,385

* Incuded in Market Vaue at Cost as te quotation is not avaiabe

@ At Book Vaue


35/57


Scedue 7 - Current Assets, loans and Advances Good uness oterwise statedAs at

31 Marc 2009


*

*

*

*

*

*

*

*

(a) Receivables under fnancing activity:I Secured:

i a Against ypotecation o automobies and durabes[Incudes overdue instaments Rs. 2,619,966,593/-Previous year Rs. 3,715,410,500/-] 18,051,765,439 14,821,179,989

b Stock o reposessed veices,consumer durabes etc.under Finance Agreements, at reaisabe / baance vaue 87,413,781 108,599,031_____________ _____________

18,139,179,220 14,929,779,020c Overdue Instaments under Finance Agreements

considered doubtu 1,167,902,174 994,238,858Less: Provision 1,167,902,174 994,238,858_____________ _____________

_____________ _____________18,139,179,220 14,929,779,020

ii Against equitabe mortgage o immovabe property undernance agreements

Good 10,613,041,433 1,685,019,210

Doubtu 12,400,000 - Less: Provision 12,400,000 _____________ _____________

_____________ _____________10,613,041,433 1,685,019,210

iii Against ypotecation o movabe xed assets 144,597,958 100,000,000

iv loan against sares secured by pedge o sares 1,000,000,000 989,132,244

v Net investment in ease secured by assets at agreementvaues ess instaments receivedGood 63,376 21,385,165

Doubtu 35,595 1,297,855Less: Provision 35,595 1,297,855_____________ _____________

_____________ _____________63,376 21,385,165_____________ _____________

Total (I) 29,896,881,987 17,725,315,639_____________ _____________II Unsecured:

i loans at agreement vaues ess instaments received[Incudes overdue instaments Rs. 446,218,530/-Previous year Rs. 211,322,317/-]Good 9,801,143,848 5,330,864,834

Doubtu 655,717,184 234,237,465 Less: Provision 655,717,184 234,237,465_____________ _____________ _____________ _____________

9,801,143,848 5,330,864,834ii Receivabes under oan assignments 560,058,801 648,022,250_____________ _____________

Total (II) 10,361,202,649 5,978,887,084_____________ _____________

Total (I+II) 40,258,084,636 23,704,202,723

(b) Cas and Bank Balances:Cas on and incuding te cas wit coecting agents 41,080,986 3,580,986Remittances in transit 690,000Baance wit Scedued Banks:In current and cas credit accounts 183,981,538 413,633,539_____________ _____________

225,062,524 417,904,525_____________ _____________Carried over 40,483,147,160 24,122,107,248


36/57


As at31 Marc 2009

Rupees Rupees Rupees Rupees

Scedue 7 - Current Assets, loans and Advances Good uness oterwise stated Contd.

Brougt over 40,483,147,160 24,122,107,248(c) Oter Current Assets:

Interest receivabe on Investments 3,101,719 15,104,219Interest receivabe on oans 6,357,961 9,522,692Finance carges receivabe 141,846,238 112,417,975Oter receivabes 95,591,453 87,140,381_____________ _____________

246,897,371 224,185,267

(d) Loans and Advances, unsecured, good:

uness oterwise stated

Advances recoverabe in cas or inkind or or vaue to be receivedGood 639,472,181 426,246,955_____________ _____________

Doubtu 118,929,987 105,599,486Less: Provision 118,929,987 105,599,486_____________ _____________

_____________ _____________639,472,181 426,246,955

Sundry deposits 50,605,664 48,495,686

Tax paid in advance 2,590,528,691 1,895,592,989____

Documents

Bafl Annual Report 2009-10