Directors
To The Members,
Your Directors have great pleasure in presenting herewith the Ninth Annual Report of
the Company for the year ended March 31, 2014.
Business Scenario
In India, higher education is seen as a key contributor towards social mobility,
reducing economic disparities, and achieving sustainable economic growth. There are over
25 million students in the Indian higher education system. Over 2,00,000 students from
India go abroad every year. There are currently over 33,000 institutes imparting higher
education in India. They have been expanding at a rapid pace offering a variety of
courses. With the increase in the cost of higher education, the ability of students to
finance their education through their own funds or with funds from their families is
likely to be difficult. It is, therefore, becoming increasingly important for students to
get access to education loans.
The Company is India’s First Dedicated Education Loan Company. The Company
provides education loans to students pursuing higher education for studies in India &
studies abroad.
During the financial year, the Company has shown robust growth in business. As on March
31, 2014 the Company’s education loan portfolio stood at Rs 1,181.75 crore,
registering an increase to 52% over the previous financial year.
The Company has also worked on establishing a multi-channel strategy to distribute its
products. The strategy includes reaching customers through the Internet, channel partners
which includes select education institutes as well as other entities of the higher
education sector.
Financial Results
The financial performance for the year ended March 31, 2014 is summarized below:-
|
Year ended March 31, 2014 |
Year ended March 31, 2013 |
|
( Rs Crore) |
( Rs Crore) |
| Total income |
1,46.57 |
90.38 |
| Total Operating Expenses |
27.90 |
24.68 |
| Gross Profit / (Loss) before interest and depreciation |
1,18.67 |
65.81 |
| Less : Interest and Finance Charges |
94.73 |
56.19 |
| Less : Depreciation |
0.43 |
0.45 |
| Profit / (Loss) before tax |
23.51 |
9.05 |
| Less : Provision for taxation |
5.20 |
1.74 |
| Add : MAT credit entitlement |
(0.87) |
(1.74) |
| Less : Provision for deferred tax |
- |
- |
| Profit / (Loss) after tax |
19.18 |
9.05 |
| Less : Transfer to reserve as per |
|
|
| Section 45IA (1) of RBI Act |
3.84 |
1.81 |
| Balance carried to Balance Sheet |
15.34 |
7.24 |
During the financial year ended March 31, 2014 the Company earned a profit before tax
of Rs 23.51 crore compared to the profit of Rs 9.05 crore the last financial year.
Company’s loan book has grown over 52% in this financial year and its total income is
increased over 62% with a small increase in its operating costs. The Company was also able
to maintain its Net Interest Margins in line with previous year in spite of increase in
the cost of funds. While achieving robust growth, the Company also maintained its quality
of the portfolio with NPA of 0.09%.
Dividend
In order to conserve resources for future, your Directors do not recommend any dividend
for the year ended March 31, 2014.
Funding
(A) Term Loans
During the year, the Credila has received sanctions from banks and financial institutes
amounting to Rs 350 crore of which Credila has availed loans aggregating to Rs 250 crore.
The outstanding bank term loans as at March 31, 2014 were Rs 762.5 crore.
(B) Commercial Paper
The Company has issued commercial paper of Rs 350 crore during the year. Commercial
paper is rated "ICRA A1+". The outstanding balance of commercial paper as at
March 31, 2014 was Rs 200 crore.
(C) Non–Convertible Debentures (NCDs)
During the year, Company has raised NCDs of Rs 44 crore on private placement basis. The
outstanding NCDs as at March 31, 2014 were Rs 74 crore. The Company is actively taking
steps to diversify its sources of funding.
(D) Share Capital
As on March 31, 2014, the paid-up share capital of the Company was Rs 120.74 Crore.
During the year, 2,50,00,000 Compulsorily Convertible Preference Shares (CCPS) of Rs 10
each are converted into 2,33,33,333 Equity Shares of Rs 10 each and the Company issued and
allotted 70,00,000 Compulsorily Convertible Preference Shares (CCPS) of Rs 10 each at par
to its Holding Company viz. HDFC Ltd. 3,49,99,984 Optionally Convertible Preference Shares
has been converted into 3,49,99,984 Compulsorily Convertible Preference Shares (CCPS) of
Rs 10 each.
Deposits
Your Company has not accepted any deposits and as such, no amount of principal or
interest was outstanding as at March 31, 2014.
Directors
In accordance with the provisions of the Companies Act, 1956 and the Articles of
Association of the Company, Mr. V. Srinivasa Rangan & Mr. Subodh Salunke are liable to
retire by rotation at the ensuing AGM. Being eligible, they have offered themselves for
re-appointment.
Necessary resolutions for the reappointment of Mr. V. Srinivasa Rangan & Mr. Subodh
Salunke have been included in the notice convening the ensuing AGM.
All the Directors of the Company have confirmed that they are not disqualified from
being appointed as Directors in terms of Section 274(1) (g) of the Companies Act, 1956.
Auditors
Messrs Deloitte Haskins & Sells, Chartered Accountants, having registration number
117365W, the statutory auditors of the Company, retire at the ensuing AGM and are eligible
for re-appointment.
The Company has received a certificate from Messrs Deloitte Haskins & Sells,
Chartered Accountants, to the effect that their re-appointment, if made, would be within
the limits prescribed.
The board recommends the appointment of Messrs Deloitte Haskins & Sells, Chartered
Accountants as the statutory auditors of the Company.
Particulars of Employees
Your Company had 179 employees as on March 31, 2014. During the year, one employee
employed throughout the year or part of the year was in receipt of remuneration of Rs 60
Lakhs or more per annum or Rs 5 Lakhs or more per month.
Particulars Regarding Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo
Since the Company does not own any manufacturing facility and has no dealings in
foreign exchange, the particulars stipulated in the Companies (Disclosure of Particulars
in the Report of the Board of Directors) Rules, 1988 are consequently not applicable.
Directors’ Responsibility Statement
As required under section 217(2AA) of the Companies Act, 1956, your Directors hereby
confirm that:
a) in the preparation of annual accounts, the applicable accounting standards have been
followed along with proper explanation relating to material departures;
b) the Directors have selected accounting policies and applied them consistently and
made judgment and estimates that are reasonable and prudent so as to give true and fair
view of the state of affairs of the Company at the end of the financial year and profit
and loss of the Company for that period;
c) the Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provision of Companies Act, 1956 for
safeguarding the assets of the Company and preventing and detecting fraud and other
irregularities to the best of their knowledge and ability;
d) the Directors have prepared annual accounts on a going concern basis.
Acknowledgements
The Company would like to acknowledge the role of all its stakeholders - shareholders,
customers, bank partners, lenders and employees for their continuing support to the
Company.
The Directors appreciate the guidance received from various regulatory authorities
including the Reserve Bank of India, Ministry of Corporate Affairs, Registrar of
Companies, and the Financial Intelligence Unit (India).
Your Directors value the professionalism of all the employees of the Company who have
relentlessly worked in a challenging environment and whose efforts have stood the Company
in good stead.
| For and on behalf of the Board of Directors, |
| MUMBAI |
RENU SUD KARNAD |
| April 16, 2014 |
Chairperson |
|