Housing Development Finance : 44th AGM Minutes - July 20, 2021

FORTY FOURTH ANNUAL GENERAL MEETING

Minutes of the proceedings of the 44th (Forty Fourth) Annual General Meeting (AGM) of the Members of HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED ('the Corporation') held on Tuesday, July 20, 2021 at 11.00 a.m. via Two-way Video Conference in compliance with the applicable circulars issued by the Ministry of Corporate Affairs.

For the purpose of applicable provisions of the Secretarial Standards, the venue of the meeting may be deemed to be the Corporate Office of the Corporation i.e. HDFC House, H. T. Parekh Marg, 165-166, Backbay Reclamation, Churchgate, Mumbai - 400 020.

PRESENT

239 Members (including authorised representatives of bodies corporate) participated at the AGM through Video Conference (VC).

The following directors of the Corporation were also present via VC:

Mr. Deepak S. Parekh	-	Chairman of the Board of Directors
Mr. Nasser M. Munjee	-	Independent Director
Dr. Jamshed J. Irani	-	Independent Director
		Chairman	of	the	Stakeholders
		Relationship Committee of Directors
		and Nomination	and	Remuneration
		Committee of Directors
Mr. U. K. Sinha	-	Independent Director
Mr. Jalaj Dani	-	Independent Director
		Chairman	of	the	Audit and
		Governance Committee of Directors
Dr. Bhaskar Ghosh	-	Independent Director
Ms. Ireena Vittal	-	Independent Director
Mr. V. Srinivasa Rangan	-	Executive Director
Ms. Renu Sud Karnad	-	Managing Director
Mr. Keki M. Mistry	-	Vice Chairman & Chief Executive
		Officer

The following persons, specifically invited for the meeting also participated through VC:

Mr. Sagar Lakhani	- Partner	- Messrs B	S R & Co. LLP,
		Chartered	Accountants,

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				Statutory	Auditors for	the
				financial year 2020-21
Mr. P. N. Parikh	-	Partner	- Messrs Parikh & Associates,
				Practising	Company
				Secretaries,	Secretarial
				Auditors	for the financial
				year 2020-21
Mr. Ashish Ahuja	-	Managing	-	Messrs Wadia	Ghandy	&
		Partner		Co., Solicitors,
Mr. Varoon Chandra	-	Partner	-	Messers	AZB	& Partners,
				Solicitors,
Mr. Bhaskar Upadhay	-	Partner	- Messrs N L Bhatia &
				Associates,	Practising
				Company	Secretaries	-
				Scrutinizer for e-voting
				process
IN ATTENDANCE
Mr. Ajay Agarwal	-		Company Secretary.
CHAIRMAN

Mr. Deepak S. Parekh, in his capacity as the Chairman of the Board of Directors of the Corporation, occupied the Chair and presided over the Meeting.

REGISTER, DOCUMENTS, REPORTS

The Chairman informed the Members that the following documents and registers as required under the Companies Act, 2013 and other applicable laws were available for online inspection by the Members:

1. Notice convening the 44th AGM;

1. Directors' Report of the Corporation for the financial year 2020-21 along with its annexures;

1. Audited Financial Statements (Standalone) and Audited Consolidated Financial Statements for the financial year 2020-21 along with respective Auditor's Reports;
2. Secretarial Audit Report for the financial year 2020-21;

1. Register of Directors and Key Managerial Personnel and their Shareholding;

vi. Register of Contracts or Arrangements in which the Directors were interested; vii. Register of Charges;

1. Auditor's Certificate in respect of the Employees Stock Option Schemes of the Corporation; and

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QUORUM

At 11.00 a.m., the Chairman welcomed the Members participating at the AGM through VC as well as those watching the proceedings of the AGM through one-way live webcast provided by the Corporation.

Thereafter, the Chairman announced that the requisite quorum was present and called the Meeting to order.

The Chairman informed that since the AGM was held through VC, the facility to Members to appoint a proxy for attending the AGM on their behalf, was not available.

AUDITORS' REPORT AND CHAIRMAN'S ADDRESS

The Chairman informed the Members that as per the applicable laws, Mr. Nasser Munjee and Dr. J. J. Irani would be retiring as the independent directors of the Corporation with effect from the close of business hours on July 20, 2021.

Thereafter, the Chairman on behalf of the Corporation and Members placed on record his gratitude and sincere appreciation towards the invaluable contributions by both the directors. He stated that Mr. Munjee was associated with the Corporation for over four decades and has seen the Corporation grow from inception to where it stands now. He further stated that Dr. Irani, too a veteran director of the Corporation played a critical role as the Chairman of the Nomination and Remuneration Committee and Stakeholders Relationship Committee of the Corporation. The Chairman added that the Corporation had benefitted immensely from the vast experience and wise counsel of both the said Directors and thanked them on behalf of the Board for their contribution to the Corporation for the past so many years.

The Chairman then stated that all the directors of the Corporation and the representatives of the statutory auditors, secretarial auditors and the scrutinizer as well as Members of the Senior Management of the Corporation were participating in the Meeting and the shareholders may address their queries, if any, to the auditors during the Q&A session.

The Chairman then stated that in view of the ongoing pandemic, resultant lockdown and in accordance with Ministry of Corporate Affairs (MCA) Circulars and circulars issued by Securities and Exchange Board of India (SEBI), the annual report and the notice convening the AGM were sent only through e-mail to those members whose e-mail address was registered and also drew reference of the Members to the notice and annual report which were uploaded on the website of the Corporation. The Chairman further confirmed that the Corporation had taken adequate steps and all efforts feasible to enable members to participate and vote on the items being considered in the meeting.

The Chairman informed the Members that since there were no qualifications, observations or comments on financial transactions or matters which could have had any adverse effect on the functioning of the Corporation, in the statutory auditors' report or secretarial auditors' report, the said reports were not required to be read.

Thereafter, the Chairman continued to address the Members.

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The Chairman briefed the Members on the current macro-economic environment, reform measures introduced by the Government and Reserve Bank of India (RBI) towards alleviating COVID-19 related stress, scope of Emergency Credit Line Scheme (ECLS), extension of Government's Credit Linked Subsidy Scheme (CLSS) for Middle Income Group (MIG) segments, one-time restructuring, outlook for the current financial year, etc. He further inter alia apprised the Members about the performance of the Corporation during the financial year 2020-21, its recovery performance and major developments during the previous financial year, especially the impact of COVID-19 pandemic.

The Chairman further briefed about the three key monitorables viz. liquidity, growth and asset quality that were articulated by the Corporation at the backdrop of COVID-19 pandemic. As regards liquidity, he mentioned that the Corporation has been maintaining higher levels of liquidity as a matter of prudence. From an asset quality perspective, he mentioned that even though there have been concerns over asset quality in the non-individual loan segment, the Corporation has a prudent approach whilst creating provisions. The Chairman also briefed the members on the various digital initiatives undertaken by the Corporation.

The Chairman stated that the Corporation has remained steadfast in its commitment towards supporting the Government's flagship scheme 'Housing for all'. During the financial year 2020-21, 33% of home loans approved in volume terms and 16% in value terms were to customers from the Economically Weaker Section (EWS) and Lower Income Group (LIG) segment.

He further informed that Pan-India, the average size of individual loans during the year stood at ` 29.5 lac as against ` 27 lac in the previous year. He then stated that as at March 31, 2021, the Corporation's loan book computed on an Assets Under Management (AUM) basis stood at

• 5,69,894 crore recording a year-on-year growth of approx. 10%.

Commenting on the recovery performance of the Corporation, the Chairman stated that in accordance with the regulatory norms the gross non-performing loans as at March 31, 2021 stood at ` 9,759 crore which was equivalent to 1.98 % of its loan portfolio.

The Chairman further informed that as per the regulatory norms, the Corporation was required to carry a total Provision and Contingencies of ` 5,491 core. He then stated that the balance in the actual Provision and Contingencies as at March 31, 2021 stood at ` 13,025 crore and the provisions carried as a percentage to the exposure at default was equivalent to 2.62%.

The Chairman further informed that the profit after tax for the year ended March 31, 2021 was

• 12,027 crore.

The Chairman informed the Members that the Board of Directors of the Corporation had recommended a final dividend of ` 23 per equity share of ` 2 each for the year ended March 31, 2021 as compared to the total dividend of ` 21 per equity share in the previous year. He stated that the payment of the final dividend of ` 23 per equity share, if approved at the AGM, would commence from Thursday, July 22, 2021.

The Chairman concluded his speech by placing on record his appreciation to all the shareholders, customers, depositors, lenders and regulatory authorities for their continued support and for having reposed their confidence in the Corporation and also to the employees of the Corporation for their hard work and dedication.

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The Chairman then invited questions, if any, from the Members and requested the Members to be brief and restrict the questions to the matters as set out in the Notice, the annual accounts and the operations of the Corporation for the financial year 2020-21. Thereafter, the Chairman requested the moderator to read out the names of speaker shareholders in the order of their registrations. The following Members spoke on various issues concerning the financials and operations of the Corporation and that of its subsidiary companies:

Mrs. Asha Lata Maheshwari, Mr. Santosh Kumar Saraf, Mrs. Lekha Satish Shah, Mr. Kaushik Shahukar, Mrs. H. S. Patel, Mr. Manoj Kumar Gupta, Mrs. Celestine Elizabeth Mascarenhas, Mr. Aloysius Peter Mascarenhas, Mr. Yusuf Yunus Rangwala, Mr. Gautam Tiwari, Mr. Ronald Fernandes, Mr. Dipankar Purkayastha, Ms. Shobhana Mehta, Mr. Adil Polad Irani, Mr. Sharadkumar Jivraj Shah, Mr. Hasmukh T. Vora, Mr. Tamal Kumar Majumder, Mr. Rishikesh Chopra, Mr. Vinayak S. Bapat, Mr. Dharav Jamadar, Mrs. Homayun Pouredehi, Mr. Ravi Kumar Naredi, Mr. Manoj Maheshwari, Mr. Bharat M. Shah, Mr. Vinod M. Agarwal, Mr. K. S. Balasubramanian, Mr. Dinesh G. Bhatia, Mr. Hariram Chaudhary, Mr. J. J. Sanghavi, Mr. Deepak Kapur and Mr. Shailesh Mahadevia

Several Members congratulated the Board of Directors for the excellent performance during the financial year 2020-21 and thanked the Board for recommending a dividend of ` 23 per equity share of ` 2 each of the Corporation for the financial year 2020-21 despite the uncertain economic environment. The Members also appreciated the transparent and wide range of information provided by the Corporation in its Annual Report.

The Members sought the views of the Chairman and Vice Chairman on the possible impact of COVID-19 on the economy especially the real estate sector. The Members also enquired on matters concerning the Corporation and its subsidiaries which inter alia included those relating to issue of bonus shares, sub-division of the face value of the equity shares from ` 2 to ` 1 per equity share, reasons for reduction in gross income/ profit after tax/ earning per share, appointment of new statutory auditors, employees affected by COVID-19 pandemic, low cost to income ratio, gender-wise and age-wise distribution of employees of the Corporation, measures taken for supporting employees during COVID-19 pandemic, Corporate Social Responsibility (CSR) spending by the Corporation including spending towards CSR Deficit, stake sale in HDFC Life Insurance Company Limited (HDFC Life) and HDFC ERGO General Insurance Company Limited (HDFC ERGO), listing of other subsidiaries of the Corporation viz. HDFC ERGO and HDFC Credila Financial Services Limited (HDFC Credila), loans sanctioned by the Corporation under CLSS, transfer of shares to Investor Education and Protection Fund (IEPF), technological and infrastructure investments done to adapt to remote working from home, foreign exchange expenditure and issue of warrants.

After all the Members spoke, the Chairman thanked them for their kind words of appreciation on the performance and achievements of the Corporation and replied to their queries.

As regards requests from several Members for issue of bonus shares and sub-division of the face value of the equity shares from ` 2 to ` 1 per equity share, the Chairman responded by stating that the Board of Directors of the Corporation have noted the suggestion of the Members and would decide the same at an appropriate time. He further informed the Members that the last bonus issue by the Corporation was on December 30, 2002 and last sub-division of equity shares (from ` 10 to ` 2) was on August 21, 2010.

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