Your directors present the thirty-sixth Annual Report along with the audited standalone and consolidated financial statements for 2022-23 (or FY2023).
Company overview
Bajaj Finance Ltd., is a public limited company incorporated on 25 March 1987 under the Companies Act, 1956 and has its registered office at Akurdi, Pune 411 035, Maharashtra, India. The Company changed its name from Bajaj Auto Finance Ltd. to Bajaj Finance Ltd. in the year 2010. It is registered as a Deposit taking Non-Banking Finance Company vide the Reserve Bank of India ('RBI') registration number A-13.00243 dated 5 March 1998. The Company launched its initial public offering of equity share and was listed on the BSE Ltd. in the year 1994. Subsequently, listed on National Stock Exchange of India in the year 2003. It is also a registered intermediary within the meaning of Insurance Regulatory and Development Authority of India ('IRDAI') as a corporate agent. The Company stood at 12th rank based on market capitalisation as on 31 March 2023. It has been classified in the Upper Layer pursuant to RBI Scale Based Regulations.
Financial Results
The highlights of the standalone financial results are given below:
| |
|
|
(C in crore)
% change over FY2022
|
|
Particulars
|
FY2023
|
FY2022
|
|
Total income
|
35,687
|
27,879
|
28
|
|
Interest and finance charge
|
9,286
|
7,578
|
23
|
|
Net interest income
|
26,401
|
20,301
|
30
|
|
Total operating expenses
|
9,453
|
7,093
|
33
|
|
Pre-impairment operating profit
|
16,948
|
13,208
|
28
|
|
Impairment on financial instruments
|
3,066
|
4,622
|
(34)
|
|
Profit before tax
|
13,882
|
8,586
|
62
|
|
Profit after tax
|
10,290
|
6,350
|
62
|
|
Retained earnings as at the beginning of the year
|
17,961
|
13,487
|
33
|
|
Profit after tax
|
10,290
|
6,350
|
62
|
|
Other comprehensive income on defined benefit plan
|
(25)
|
(3)
|
733
|
|
Retained earnings before appropriations
|
28,226
|
19,834
|
42
|
|
Appropriations
|
|
|
|
Transfer to reserve fund u/s 45-IC (1) of the RBI Act, 1934
|
(2,060)
|
(1,271)
|
62
|
|
Dividend paid
|
(1,211)
|
(603)
|
101
|
|
Adjustment of dividend to ESOP Trust
|
4
|
1
|
300
|
|
Retained earnings as at the end of the year
|
24,959
|
17,961
|
39
|
|
Due to rounding off, numbers presented in above table may not add up precisely to the totals provided.
|
Transfer to Reserve Fund
Under section 45-IC (1) of Reserve Bank of India ('RBI') Act, 1934, non-banking financial companies ('NBFCs') are required to transfer a sum not less than 20% of its net profit every year to reserve fund before declaration of any dividend. Accordingly, Bajaj Finance Ltd. (the 'Company', 'Bajaj Finance' or 'BFL') has transferred a sum of C 2,060 crore to its reserve fund.
Pursuant to provisions of Companies Act, 2013 (the 'Act') read with relevant rules thereunder, the Company, being a NBFC, is exempt from creating debenture redemption reserve in respect of privately placed debentures including the requirement to invest up to 15% of the amount of debentures maturing during the next financial year. However, the Company maintains sufficient liquidity buffer to fulfill its obligations arising out of debentures. In case of secured debentures, an asset cover of at least 100% is maintained at all times.
Dividend Distribution Policy
Pursuant to the provisions of regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the 'SEBI Listing Regulations'), the Company had formulated a dividend distribution policy, which sets out the parameters and circumstances to be considered by the Board of Directors ('Board') in determining the distribution of dividend to its shareholders and/or retaining profit earned. The policy is annexed to this Report and is also available on the website of the Company at https://cms-assets.bajajfinserv.in/is/content/bajajfinance/dividend-distribution-policypdf?scl=1 &fmt=pdf
Dividend
RBI vide its circular dated 24 June 2021 has laid down a framework for declaration of dividend by NBFCs. Accordingly, the Board of Directors, after taking into account various aspects and in compliance with the said circular, recommend for consideration of the members at the ensuing Annual General Meeting ('AGM'), payment of final dividend of C 30 per equity shares (1500%) of face value of C 2. The total dividend for FY2023 is C 1,816 crore.
The dividend recommended is in accordance with the principles and criteria set out in the Company's dividend distribution policy. Total dividend proposed for the year does not exceed the ceilings specified in said circular/ RBI Master Directions.
The dividend, if declared, at the ensuing AGM will be taxable in the hands of the members of the Company pursuant to Income Tax Act, 1961. For further details on taxability, please refer Notice of AGM.
Scale Based Regulations
Reserve Bank of India issued a circular on "Scale Based Regulation (SBR): A Revised Regulatory Framework for NBFCs" on 22 October 2021 ('SBR Framework'). As per the framework, based on size, activity, and risk perceived, NBFCs are categorised into four layers, NBFC - Base Layer (NBFC-BL), NBFC - Middle Layer (NBFC-ML), NBFC - Upper Layer (NBFC-UL) and NBFC - Top Layer (NBFC-TL). RBI has categorised Bajaj Finance Limited as an NBFC - Upper Layer (NBFC-UL) vide its press release dated 30 September 2022. The Company has put in place necessary Board approved policies like Large Exposures Policy, Internal Capital Adequacy Assessment Policy, Compensation Policy for Key Managerial Personnel and Senior Management, Compliance Policy, Board approved limits for Sensitive Sectors Exposure under the SBR Framework, etc.
Working Results of the Company
On a consolidated basis, BFL recorded core AUM (AUM excluding extreme short tenor IPO loans) growth of 29% and growth in profit after tax of 64% in FY2023 as against core AUM and profit after tax growth of 26% and 59%, respectively, in FY2022. With its strong AUM and profit growth in FY2023, BFL has further increased its share in the financial services sector in India. Return on average assets (ROAA) and return on average equity (ROAE) for FY2023 was 5.3% and 23.5% respectively on a consolidated basis.
The Company's business model continues to generate healthy pre-impairment operating profits enabling it to withstand higher credit losses in times of stress such as these. It remains well capitalised with a capital-to-risk weighted asset ratio (CRAR) of 24.97% as on 31 March 2023 - making it among the best capitalised large NBFCs in India.
As a result of its deeply embedded risk culture and robust risk management practices, the Company's portfolio quality as of 31 March 2023 continues to remain strong. BFL's consolidated Gross NPA at 0.94% and Net NPA at
0.34% are among the lowest in the industry.
Using its robust risk management and portfolio monitoring framework, BFL took enhanced credit costs based on emerging trends across its different portfolios. It holds a management overlay provision on account of volatile macroeconomic factors of C 960 crore on consolidated basis as on 31 March 2023.
The consolidated performance highlights for FY2023 are given below:
• Number of new loans booked: 29.6 million
• Core AUM grew by 29% to C 247,379 crore
• Total income increased by 31% to C 41,406 crore
• Net interest income (NII) rose by 32% to C 28,846 crore
• Total operating cost to NII stood at 35.1%
• Impairment on financial instruments was C 3,190 crore
• Profit before tax (PBT) increased by 63% to C 15,528 crore
• Profit after tax (PAT) increased by 64% to C 11,508 crore
• Capital adequacy ratio as of 31 March 2023 was 24.97%, which is well above the RBI norms. Tier I adequacy ratio was 23.20%
With the experience of managing significant financial and operational disruption emanating after the pandemic, the transformational journey that BFL has embarked upon and the exit momentum of FY2023, the Company remains confident of a sound growth trajectory in FY2024 and thereafter and, hence, remain a leading NBFC in India.
Resilience and agility are deeply embedded in BFL's culture. These cultural anchors have enabled BFL to make swift and calibrated changes to its risk and debt management practices to regain its business momentum while maintaining strong vigil on its portfolio quality and adapting to changing customer preferences of post pandemic world.
For more details on the performance of the Company, business segments and risk management framework and initiatives, please refer to the section on Management Discussion and Analysis.
Operations
BFL is one of the largest and most diversified NBFCs in India. It has worked with approximately 69.1 million customers since it started its transformational journey in FY2008 from a mono-line captive lender to a diversified financial service business. During this period, the Company expanded its presence to 3,733 locations with a distribution network of over 154,650 points of sale and also created a strong presence in the digital space.
BFL was among the early movers to transit to digital processes in the financial services industry. It had already moved from 'Physical' to 'Phygital' in a seamless manner and has embarked to move to the last phase, namely 'Digital', in the last four years.
The Company believes that each customer is a critical asset in its growth journey and their satisfaction is BFL's primary responsibility - which it thrives to achieve through an omnichannel strategy. Business transformation requires significant changes in operating processes and core technology stack of the Company. It focuses on building an 'omnichannel' model to deliver significant business velocity, reduction in operating costs and significant improvement in customer experience. This model with an integrated offering of products and services, will enable BFL to become a 'moment of truth' enterprise for its customers.
Further details regarding the operations, state of affairs and initiatives of the Company are given in the Management Discussion and Analysis.
Subsidiaries, Associates and Joint Ventures
A. Subsidiaries:
The Company has two wholly owned subsidiaries, viz.,
(i) Bajaj Housing Finance Ltd. ('BHFL' or 'Bajaj Housing'), which is registered with National Housing Bank as a Housing Finance Company ('HFC'); and
(ii) Bajaj Financial Securities Ltd. ('BFinsec'), which is registered with the Securities and Exchange Board of India ('SEBI') as a stockbroker, depository participant and research analyst.
During FY2023, no new subsidiary was incorporated/acquired. The Company has not entered into a joint venture with any other company.
The financial statements of the subsidiary companies are also available in a downloadable format under the 'Investor Relations' section on the Company's website at https://www.bajajfinserv.in/finance-investor-relation-annual-reports.
The Company's policy for determination of material subsidiary, as adopted by the Board of Directors, in conformity with regulation 16 of the SEBI Listing Regulations, can be accessed on the Company's website at https://cms-assets.bajajfinserv.in/is/content/bajajfinance/policy-for-determining-material-subsidiary-v1 pdf?scl=1 &fmt=pdf.
In terms of the said policy and provisions of regulation 16 of the SEBI Listing Regulations, BHFL is a material subsidiary of the Company.
Performance highlights of the subsidiaries are given below:
BHFL
• AUM as at 31 March 2023 was C 69,228 crore as compared to C 53,322 crore as at 31 March 2022, representing a growth of 30%
• Total income increased by 50% to C 5,665 crore
• NII rose by 52% to C 2,454 crore
• Total operating cost to NII stood at 25.7%
• Impairment on financial instruments was C 124 crore. BHFL holds a management overlay provision of C 237 crore as of 31 March 2023 on account of volatile macro economic factors
• Gross NPA and Net NPA were at 0.22% and 0.08%, respectively, amongst the lowest across all HFCs
• PBT increased by 77% to C 1,700 crore
• PAT grew by 77% to C 1,258 crore
• As on 31 March 2023, capital adequacy ratio was 22.97%, which is well above the prescribed norms of 15%
During FY2023, the Company infused aggregate amount of ~C 2,500 crore to reduce leverage and fund accelerated growth of BHFL.
The total investment as on 31 March 2023 in BHFL is approximately C 7,528 crore.
BFinsec
• The customer franchise as of 31 March 2023 was over 565,100
• Total Income for FY2023 was C 204 crore
• PAT was C 8 crore
During the year under review, no investments were made in BFinsec. The total investment as on 31 March 2023 is approximately C 670 crore.
For more detailed discussion on the performance of the subsidiaries and their various segments, refer to the Management Discussion and Analysis.
B. Associates
Snapwork Technologies Private Ltd. ('Snapwork')
During FY2023, the Company acquired 41.5% stake on a fully diluted basis in Snapwork for an aggregate amount of ~C 93 crore, with a view to strengthen Company's technology roadmap. Pursuant to provisions of the Act, post-acquisition, Snapwork became an associate of the Company.
Snapwork is engaged in the business of developing, consulting, providing, exporting, importing, marketing, dealing in and implementation of software technology and allied products for its clients and conducting research and development for the same.
Details of investment made in Snapwork also forms part of the financial statements.
Post-acquisition of shares by the Company, Snapwork made a profit of C 4.03 crore, of which Company's share of profit was C 1.67 crore.
A separate statement containing the salient features of the subsidiaries and associate in the prescribed form AOC-1 is attached to the consolidated financial statements.
Other strategic investments
Bajaj Finserv Direct Ltd. ('BFS-Direct) is primarily engaged in business of distribution of financial products through its digital marketplace. BFS-Direct is registered with Insurance Regulatory and Development Authority of India as a composite Corporate Agent for distribution of insurance (life and genera) products in India.
During FY2023, no fresh investments were made by BFL into BFS-Direct. The Company continues to hold 19.87% of its capital and the remaining 80.13% is held by Bajaj Finserv Ltd., the holding company. Details of investment made in BFS-Direct also forms part of the financial statements.
Customer Engagement
The Company is committed to fairness, in both form and spirit, in its conduct with customers. One of the key aims of the Company is to communicate transparently its terms, rights and liabilities to enable them to make prudent financial decision.
In line with the above, the Company strives to create a culture of 'Customer Obsession' and endeavors to provide a frictionless experience across the lifecycle, from pre-disbursal to closure of loan, deposit accepting activities and other value-added services. The Company measures its Net Promoter Score to rate its customer loyalty. This helps the Company to gauge the outcome of its customer engagement efforts.
To strengthen the customer engagement and monitoring process, the Board of Directors have voluntarily constituted a Customer Service Committee ('CSB'), in line with the requirements applicable to Banks. It is headed by an independent director. The Committee consists of following Board members:
1. Pramit Jhaveri - Chairman, non-executive, independent
2. Dr. Naushad Forbes - Member, non-executive, independent
3. Sanjiv Bajaj - Member, non-executive, non-independent
4. Rajeev Jain - Member, executive, non-independent
During the year under review, the Board enhanced the scope of the Committee to cover the following:
• To review the performance of the Company (with respect to Customer Services) against baseline parameters defined by the Management. The matters which do not meet the baseline parameters will be reported to Risk Management Committee.
• Regulatory observations pertaining to Customer Service and remediation plan.
The updated terms of reference can be accessed at https://cms-assets.bajajfinserv.in/is/content/bajajfinance/ csc-terms-of-referencepdf?scl=1&fmt=pdf
During FY2023, the Committee met twice.
In addition, the Company has in place a Standing Committee of Management for Customer Service. The Committee meets on a quarterly basis. The terms of reference of the Committee, inter alia, covers the following:
• To review and evaluate the feedback received from customer service teams;
• To review and guide on the actionable shared by the service team and recommend the process/policy changes required, if any;
• To review the customer complaints received and redressed during the period as well as advisory/awards issued by the regulatory;
• This Committee shall also perform duties relating to Customer Grievance including:
(a) Conducting root cause analysis for complaints;
(b) Formulate a structured process and oversee the measures taken for grievance redressal of customers.
The CSB is updated on the discussions, actions and other recommendation of this Standing Committee. The suggestion, feedback and guidance from CSB is taken note of by the Standing Committee for necessary actions.
Various interventions, to uphold BFL's commitment towards the customers, under the guidance of these Committees are undertaken. To list a few:
• Enablement of various customer service channels for customers to engage, transact and be serviced online as well as offline channels of their choice and convenience through Mobile App, Website, IVR, branch, email and Social media.
• Dedicated Customer Service branches have been set up across major cities.
• Significant investments and progress in enabling digital channels for engaging with customers.
• Standardisation of communication content being sent to the customer, at various life cycle events as per the laid governance. This includes all types of communications like notifications, SMS, email etc.
• Setting up of a dedicated team to oversee the fees and charges being communicated to the customers at the time of sourcing, across all products.
Other initiatives of the Company towards customer engagement are detailed in the Management Discussion and Analysis.
The Company has suo moto adopted the Internal Ombudsman (IO) framework since December 2020 prior to it being mandated for NBFCs in May 2022. Presently, the Company has appointed two IOs.
Risk Management
The Board of Directors have adopted a risk management policy for the Company which provides for identification of key events/risks impacting the business objectives of the Company and attempts to develop risk policies and strategies to ensure timely evaluation, reporting and monitoring of key business risks.
This framework, inter alia, provides the set of components that provide the foundations and organisational arrangements for designing, implementing, monitoring, reviewing and continually improving Risk Management throughout the organisation. It covers principles of risk management, risk governance with roles and responsibilities, business control measures, principle risks and business continuity plan. The Management identifies and controls risks through a defined framework in terms of the aforesaid policy.
The Board is of the opinion that there are no elements of risk that may threaten the existence of the Company.
The current composition of Risk Management Committee ('RMC') is as follows:
1. Pramit Jhaveri - Chairman, non-executive, independent
2. Anami N Roy - Member, non-executive, independent
3. Sanjiv Bajaj - Member, non-executive, non-independent
4. Rajeev Jain - Member, Managing Director, executive
5. Deepak Bagati - Member, President - debt management services
6. Fakhari Sarjan - Member, Chief Risk Officer
7. Sandeep Jain - Member, Chief Financial Officer
Further details on RMC are furnished in the Corporate Governance Report.
More detailed discussion on the Company's risk management and portfolio quality is covered in the Management Discussion and Analysis.
Business Continuity and Cyber Security
The Company continues to enhance cyber security and information security aspects while transforming to a customer-centric digital enterprise. It has capability to offer remote access for identified IT vendors/partners to enable full resources for user support, data center support, application maintenance and testing. All key IT systems are compliant to ISO 27001 Information Security Management System and ISO 22301 Business Continuity Standard. The Company also has a dedicated cyber security and information security team to ensure technical expertise and regulatory as well as internal compliance for Information Technology. In addition, an outsourcing compliance unit and third-party security governance framework is also set up. As part of Omnipresence Strategy, the 3-in-1 app is live now with recent version 9.0.5 (954) and the Company will continue its journey towards a digital organisation.
The Company operates all its critical internet-facing properties behind a well-known cloud-based web application firewall to safeguard against web application attacks as well as distributed denial of service attacks. Further, regular vulnerability assessment and penetration testing, review of segregation of duties, other audit and compliance testing(s) have ensured that the Company's information assets are safe and secure.
As a part of the brand protection efforts and to safeguard customer's interest, the Company constantly monitors and, where needed, removes inappropriate/misleading social media pages. An awareness programme is conducted for all employees using the digital channel regarding cyber security. The Company continues cyber security awareness for customers across digital and social media platforms to educate customers and the public at large on financial fraud risks and how to stay protected. Employees of the Company are required to undergo a mandatory online learning module on information security and affirm that they have understood these and are aware of the protocols to be followed. Cyber security awareness session was conducted for Board members as well. Regular information security related mailers are sent to all employees for awareness and training purpose.
The Company will continue its focus on security monitoring and incident response through its security operations centre.
A detailed discussion on information systems, cyber security and information technology is covered under Management Discussion and Analysis.
Directors and Key Managerial Personnel ('KMP')
A. Change in Directors and KMP during the financial year
(i) Appointments:
Independent Directors
Radhika Haribhakti (DIN: 02409519):
On recommendation of Nomination and Remuneration Committee ('NRC'), the Board has appointed Radhika Haribhakti as an independent director of the Company for a period of five consecutive years effective from 1 May 2022. The same has been approved by the members vide their special resolution dated 27 July 2022.
The Board is of the opinion that Radhika Haribhakti is a person of integrity, expertise, and competent experience and proficiency to serve the Company as an independent director that can strengthen the overall composition of the Board.
Radhika Haribhakti is exempted from requirements of clearing the online proficiency test pursuant to rule 6(4) of Companies (Appointment and Qualifications of Directors) Rules, 2014, as amended. However, she has on a voluntary basis appeared and cleared the proficiency test.
She is a member of Stakeholders Relationship Committee and Chairperson of Nomination and Remuneration Committee. In addition, she is also a member of Review Committee for identification of wilful defaulter constituted pursuant to RBI Regulations.
Dr. Arindam Bhattacharya (DIN: 01570746):
On recommendation of Nomination and Remuneration Committee ('NRC'), the Board, at its meeting held on 16 March 2023, appointed Dr. Arindam Bhattacharya as an independent director of the Company for a period of five consecutive years effective from 1 April 2023.
The Board is of the opinion that Dr. Arindam Bhattacharya is a person of integrity, expertise, and competent experience and proficiency to serve the Company as an independent director that can strengthen the overall composition of the Board.
Dr. Arindam Bhattacharya has successfully passed the online proficiency self-assessment test as required under the provisions of rule 6(4) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, as amended.
He is a member of Audit Committee.
Executive Directors:
Considering the growth and complexity of the business of the Company and in line with the succession framework, the Board, at its meeting held on 16 March 2023, based on the recommendation of NRC, approved appointments of Rakesh Bhatt (DIN: 02531541) and Anup Saha (DIN: 07640220) as Executive Directors of the Company for a period of 5 years effective 1 April 2023.
Both Rakesh Bhatt and Anup Saha are KMPs within the meaning of section 2(51) of the Act. Rakesh Bhatt is a member of IT Strategy Committee.
In terms of regulation 17(1C) of SEBI Listing Regulations, the Company is seeking approval of shareholders within the time limit prescribed therein by way of postal ballot with reference to the aforesaid appointments.
(ii) Resignation:
On account of health reasons, Madhur Bajaj (DIN: 00014593) resigned as non-executive director of the Company with effect from close of business hours on 31 July 2022. The Board places on record its sincere appreciation for the valuable contribution made by him during his long tenure as director on the Board of the Company.
Further, as mentioned in Directors' Report presented for last year, the independent directors, Ranjan Sanghi (DIN: 00275842) and Dr. Gita Piramal (DIN: 01080602) stepped down as directors with effect from close of business hours on 30 April 2022.
B. Directors liable to retire by rotation
Rajiv Bajaj (DIN:00018262) retires by rotation at the ensuing AGM, being eligible, offers himself for re-appointment.
Brief details of Rajiv Bajaj, who is seeking re-appointment, are given in the Notice of 36th AGM.
C. KMPs
Save and except as stated above, there are no other changes in the KMPs during FY2023.
Declaration by independent directors
All the independent directors have submitted a declaration of independence, stating that they meet the criteria of independence provided under section 149(6) of the Act read with regulation 16 of the SEBI Listing Regulations, as amended. They also confirmed compliance with the provisions of rule 6 of Companies (Appointment and Qualifications of Directors) Rules, 2014, as amended, relating to inclusion of their name in the databank of independent directors.
The Board took on record the declaration and confirmation submitted by the independent directors regarding them meeting the prescribed criteria of independence, after undertaking due assessment of the veracity of the same in terms of the requirements of regulation 25 of the SEBI Listing Regulations.
Remuneration Policies
A. Policy on Directors' Appointment and Remuneration
Pursuant to section 178(3) of the Companies Act, 2013 and regulation 19(4) read with Part D of schedule II of the SEBI Listing Regulations, the Board has framed a Remuneration Policy. This policy, inter alia, lays down:
(a) The criteria for determining qualifications, positive attributes and independence of directors; and
(b) Broad guidelines of compensation philosophy and structure for non-executive directors, key managerial personnel and other employees.
In view of detailed RBI Guidelines for NBFCs concerning compensation of Key Managerial Personnel (KMP) and Senior Management (SMT), the Company has adopted a specific policy to this effect. Accordingly, this remuneration policy has to be read along with the specific policy adopted pursuant to RBI Guidelines as regards compensation of KMP and SMT, which is detailed below.
B. Policy for Compensation of KMP and SMT pursuant to RBI Guidelines
RBI has vide its circular dated 29 April 2022 issued Guidelines on Compensation of Key Managerial Personnel and Senior Management in NBFCs pursuant to Scale Based Regulatory Framework. Accordingly, the Board of Directors at their meeting held on 16 March 2023 based on the recommendation of NRC, adopted a policy exclusively governing compensation payable to KMP and SMT. This policy lays down detailed framework, inter alia, encompassing the following:
• Principles of compensation;
• Compensation components;
• Principles of variable pay;
• Deferral of variable pay;
• Compensation for control and assurance function personnel; and
• Provisions for malus and clawback and circumstances under which application of malus and clawback is to be considered.
The aforesaid policies can be accessed at https://cms-assets.bajajfinserv.in/is/content/bajajfinance/ remuneration-policypdf?scl=1 &fmt=pdf and https://cms-assets.bajajfinserv.in/is/content/bajajfinance/ remuneration-policy-rbipdf?scl=1 &fmt=pdf
As per the requirements of the RBI Master Directions and SEBI Listing Regulations, details of all pecuniary relationship or transactions of the non-executive directors vis-a-vis the Company are disclosed in the Corporate Governance Report.
Compliance with Code of Conduct
All Board members and Senior Management personnel have affirmed compliance with the Company's Code of Conduct for FY2023.
A declaration to this effect signed by the Managing Director is included in this Annual Report.
Annual Return
A copy of the Annual Return as provided under section 92(3) of the Act, in the prescribed form, which will be filed with the Registrar of Companies/MCA, is hosted on the Company's website and can be accessed at https://www.bajajfinserv.in/finance-investor-relation-annual-reports
Number of Meetings of the Board
Six (6) meetings of the Board were held during FY2023. Details of the meetings and attendance thereat forms part of the Corporate Governance Report.
Directors' Responsibility Statement
The financial statements are prepared in accordance with the Indian Accounting Standards (Ind AS) under historical cost convention on accrual basis except for certain financial instruments, which are measured at fair value pursuant to the provisions of the Act and guidelines issued by SEBI/RBI. Accounting policies have been consistently applied except where revision to an existing Accounting Standard requires a change in the accounting policy.
In accordance with the provisions of section 134(3) (c) of the Act and based on the information provided by the Management, the Directors state that:
i. in the preparation of the annual accounts, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;
ii. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for FY2023;
iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. they have prepared the annual accounts on a going concern basis;
v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.
Audit Committee
Sanjiv Bajaj, non-executive, non-independent director stepped down as member with effect from close of business hours on 31 March 2023 and Dr. Arindam Bhattacharya was inducted as a member effective from 1 April 2023.
The present composition of the Committee as approved by the Board at its meeting held on 16 March 2023 is as follows: Anami N Roy (DIN: 01361110), Chairman, Dr. Naushad Forbes (DIN: 00630825), Pramit Jhaveri (DIN: 00186137) and Dr. Arindam Bhattacharya.
The composition of Audit Committee is over and above the minimum requirement prescribed under the Act,
SEBI Listing Regulations, and the RBI Regulations for NBFCs (the 'NBFC Regulations') of having a minimum of two-thirds of independent directors, including the Chairman. All members of the Committee are non-executive independent directors possessing financial literacy, and expertise in accounting or financial management related matters.
During FY2023, all recommendations of the Audit Committee were accepted by the Board.
The brief terms of reference and attendance record of members are given in the Corporate Governance Report.
Particulars of Loans, Guarantees and Investments
The Company, being an NBFC registered with the RBI and engaged in the business of giving loans in ordinary course of its business, is exempt from complying with the provisions of section 186 of the Act with respect to loans, guarantees and investments. Accordingly, the Company is exempted from complying with the requirements to disclose in the financial statement the full particulars of the loans given, investment made or guarantee given or security provided.
In addition to investment in subsidiaries, associates and group companies which is covered above, details of other major strategic investments are under:
1. One MobiKwik Systems Ltd. ('MobiKwik'):
The Company continues to stay invested in MobiKwik. Total investment in MobiKwik as on 31 March 2023 is approximately C 296.89 crore.
The total equity shares held by the Company in MobiKwik is 7,979,440 equity shares representing 13.95% of its capital on a fully diluted basis.
2. RBL Bank Ltd.
The Company continues to stay invested in RBL Bank Ltd.
The Company has additionally disclosed information regarding investments in the financial statements. Employee Stock Options ('ESOP')
The Company offers stock options to select employees of the Company and its subsidiaries to foster a spirit of ownership and an entrepreneurial mindset. Because of their nature, stock options help to build a holistic, longterm view of the business and a sustainability focus in the Senior Management team. Stock options are granted to tenured employees in managerial and leadership positions upon achieving defined thresholds of performance and leadership behaviour. This has contributed to the active involvement of the leadership and senior team who are motivated to ensure long-term success of the Company. Grant of stock options also allows the Company to maintain the right balance between fixed pay, short-term incentives and long-term incentives to effectively align with the risk considerations and build the focus on consistent long-term results.
As per the Employee Stock Option Scheme of the Company, total option that could be granted is 35,071,160. During the year under review, the scheme has not been amended and it is in compliance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.
A statement giving complete details, as at 31 March 2023, under regulation 14 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, is available on the website of the Company and can be accessed at https://www.bajajfinserv.in/finance-investor-relation-annual-reports
Grant wise details of options vested, exercised and cancelled are provided in the notes to the standalone financial statements. The Company has not issued any sweat equity shares or equity shares with differential voting rights during FY2023.
Share Capital
During FY2023, no new equity shares were issued.
As on 31 March 2023, the paid-up share capital of the Company stood at C 121.09 crore consisting of 605,429,233 equity shares of face value of C 2 fully paid-up.
Related Party Transactions
All contracts/arrangement/transactions entered by the Company during FY2023 with related parties were in compliance with the applicable provisions of the Act and SEBI Listing Regulations. Prior omnibus approval of the Audit Committee is obtained for all related party transactions which are foreseen and of repetitive nature. Pursuant to the said omnibus approval, details of transaction entered into is also reviewed by the Audit Committee on a quarterly basis.
All related party transactions entered during FY2023 were in the ordinary course of business, at arm's length and not material under the Act and SEBI Listing Regulations. None of the transactions required members' prior approval under the Act or SEBI Listing Regulations.
Details of transactions with related parties during FY2023 are provided in the notes to the financial statements. There were no transaction requiring disclosure under section 134(3) (h) of the Act. Hence, the prescribed Form AOC-2 does not form a part of this Report.
The policy on materiality of related party transactions and on dealing with related party transactions is available on the website of the Company at https://cms-assets.bajajfinserv.in/is/content/bajajfinance/policy-of-materiality-and-dealing-with-related-party-transactionpdf?scl=1 &fmt=pdf and also forms a part of the Corporate Governance Report.
Succession Planning
The Company has in place a succession planning framework to address anticipated, as well as unscheduled changes in leadership. The plan is revisited, re-evaluated and updated every year. The key attribute of the plan involves:
• Organisational level Long Range Strategy wherein talent required to fulfil the Company's strategy and annual operating plan is discussed and planned.
• Performance appraisal system which helps identifying people demonstrating leadership behaviours in line with our cultural anchors.
• Talent Management framework is a bi-annual exercise under which a Talent Card is made for every Senior Management team member.
• Job Rotation Policy with the intent of providing movement and enhancements to senior leaders in the organisation.
Material Changes and Commitments
There were no material changes and commitments affecting the financial position of the Company which occurred between the end of the financial year and the date of this Report.
Conservation of Energy
The operations of the Company are not energy intensive. The Company implements various energy conservation measures across all its functions and value chain, which are highlighted in the Business Responsibility and Sustainability Report.
Technology Absorption
The details pertaining to technology absorption have been explained in the Management Discussion and Analysis.
Considering the nature of services and businesses, no specific amount of expenditure is earmarked for Research and Development. However, the Company on an ongoing basis strives for various improvements in the products, platforms, and processes.
Foreign Exchange Earnings and Outgo
During FY2023, the Company did not have any foreign exchange earnings and the foreign exchange outgo in terms of actual outflow amounted to C 4,245.17 crore.
Corporate Social Responsibility ('CSR')
The CSR Committee comprises of three directors viz., Dr. Naushad Forbes, Chairman, Sanjiv Bajaj and Rajeev Jain, members.
The CSR obligation of the Company for FY2023 is C 138.33 crore. As on 31 March 2023, total amount spent on CSR activities by Company is C 117.46 crore.
As per section 135 of the Act read with Companies (Corporate Social Responsibility) Rules, 2014, as amended, the Company is required to transfer any unspent amount, pursuant to any ongoing project undertaken by the Company in pursuance of its Corporate Social Responsibility Policy, within a period of thirty days from the end of the financial year to a special account opened by the Company in that behalf for that financial year in any scheduled bank called Unspent Corporate Social Responsibility Account.
Due to delay in commencement of project as compared to approved timelines, some part of the mandatory spend for few ongoing projects remained unspent as on 31 March 2023, thereby requiring it to be transferred
to an Unspent Corporate Social Responsibility Account. Accordingly, the Company has opened necessary bank account to transfer unspent amount of C 20.87 crore.
Detailed information on CSR Policy, its salient features, details pertaining to spent and unspent amount forms part of Annual Report on CSR activities.
The CSR policy has been hosted on the website of the Company and can be accessed at https://cms-assets. bajajfinserv.in/is/content/bajajfinance/corporate-social-responsibilitypdf?scl=1 &fmt=pdf.
Further, the Chief Financial Officer has certified that the funds disbursed have been utilised for the purpose and in the manner approved by the Board for FY2023.
Formal Annual Evaluation of the performance of the Board, Committees and directors
Pursuant to section 178 of the Act, the NRC and the Board has decided that the evaluation shall be carried out by the Board only and the NRC will only review its implementation and compliance.
Further, as per Schedule IV of the Act and provisions of the SEBI Listing Regulations, the performance evaluation of independent directors shall be done by the entire Board excluding the directors being evaluated, on the basis of performance and fulfilment of criteria of independence and their independence from Management. On the basis of the report of the performance evaluation, it shall be determined whether to extend or continue the term of appointment of independent director.
Accordingly, the Board has carried out an annual performance evaluation of its own performance, that of its Committees, Chairperson and individual directors.
The manner in which formal annual evaluation of performance was carried out by the Board for the year 2022-23 is given below:
• The NRC at its meeting held on 19 May 2020, reviewed the criteria for performance evaluation. The criteria is available on the website of the Company at https://cms-assets.bajajfinserv.in/is/content/ bajajfinance/performance-evaluation-criteria-for-board-committees-of-board-chairperson-and-directorspdf?scl=1 &fmt=pdf
• Based on the said criteria, a questionnaire-cum-rating sheet was deployed using an IT platform for seeking feedback of the directors with regards to the performance of the Board, its Committees, the Chairperson and individual directors.
• From the individual ratings received from the directors, a report on summary of ratings in respect of performance evaluation of the Board, its Committees, Chairperson and individual directors for the year 2022-23 and a consolidated report thereof were arrived at.
• The report of performance evaluation so arrived at was then discussed and noted by the Board at its meeting held on 16 March 2023.
• The NRC reviewed the implementation and compliance of the performance evaluation at its meeting held on 16 March 2023.
• Based on the report and evaluation, the Board and NRC at their respective meetings held on 16 March 2023, determined that the appointment of all independent directors may continue.
• Details on the evaluation of Board, non-independent directors and Chairperson of the Company as carried out by the independent directors at their separate meeting held on 16 March 2023 have been furnished in a separate paragraph elsewhere in this Report.
• During FY2023, the process followed by the Company was reviewed by the NRC, which opined these to be in compliant with applicable provisions and found it to be satisfactory.
Other than Chairman of the Board and NRC, no other director has access to the individual ratings given by directors.
The criteria was reviewed by the NRC and Board and advised enhancement to the feedback mechanism by introducing few qualitative aspects to the criteria.
Significant and Material Orders passed by the Regulators or Courts
During FY2023, there were no significant or material orders passed by any regulator or court or tribunal impacting the going concern status and Company's operations in future.
Internal Financial Controls
Internal Financial Controls laid down by the Company is a systematic set of controls and procedures to ensure orderly and efficient conduct of its business including adherence to the Company's policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. Internal financial controls not only require the system to be designed effectively but also to be tested for operating effectiveness periodically.
The Board is of the opinion that internal financial controls with reference to the financial statements were tested and reported adequate and operating effectively. The internal financial controls are commensurate with the size, scale and complexity of operations.
Internal Control Systems and their adequacy has been discussed in more detail in Management Discussion and Analysis.
Deposits
The Company accepts deposits from retail and corporate clients. As on 31 March 2023, it had a standalone deposit book of C 44,489.79 crore, delivering an annual growth of 46.88% in FY2023. Deposits contributed to 27.52% of BFL's standalone borrowings versus 24.62% as at the end of FY2022.
The consolidated deposits book as on 31 March 2023 stood at C 44,665.56 crore, delivering an annual growth of 45.02% in FY2023. Deposit contributed to 20.61% of its consolidated borrowings as on FY2023 versus 18.64% as at the end of FY2022.
Break-up of deposits raised on a consolidated basis:
| |
|
(C in crore)
|
|
Sr.
No. Type
|
Amount
raised
|
Outstanding as on 31 March 2023
|
|
1. Public deposit
|
15,793.02
|
28,303.10
|
|
2. Corporate deposit
|
13,684.07
|
11,518.30
|
|
3. Other deposit
|
3,271.55
|
4,668.39
|
Pursuant to provisions of the RBI Act, 1934, the Company has created a charge on statutory liquid assets
amounting to C 5,192.05 crore in favour of the trustee for Public Fixed Deposit ('FD') holders.
During FY2023, there was no default in repayment of deposits or payment of interest thereon.
With a view to reduce unclaimed deposits, the Company adopted the following process:
• Wherever payment of deposit amount and interest thereon is rejected by bank of the deposit holder,
Customer Service Team calls the depositor to inform about rejection reason and advise them the process for change of linked bank account;
• In addition, SMS/Email/Physical letter are also sent to depositors to inform them of rejection reason(s) and advise them to initiate appropriate action for change of bank details;
• Account payee cheque in the name of the customer for unclaimed amount is dispatched at customer's communication address (excluding deceased cases, where settlement is to be done as per nomination/ survivorship clause);
• In case of death of depositors, claim settlement process is advised to joint depositors/nominee/legal heir, as the case may be;
• Wherever the residential status of the depositors has changed from Resident to Non-Resident, they are advised to submit updated FATCA/CRS declaration and to get their bank details updated.
As on 31 March 2023, there were 58 deposits amounting to C 73.29 lakh which had matured and remained
unclaimed and interest on matured deposits amounting to C 7.23 lakh and interest on active deposits amounting
to C 3.90 lakh had also remained unclaimed.
Borrowings
The total borrowing limit approved by the shareholders stands at C 225,000 crore.
The total borrowing as on 31 March 2023 is C 161,684.63 crore. The break-up of the same is as under:
| |
|
|
|
|
|
(C in crore)
|
|
Particulars
|
Deposits
|
Bank Loans (TL/CC/ OD/WCDL)
|
Non
Convertible
Debentures
|
Subordinate
Liability
|
Short-term
Borrowings
|
External
Commercial
Borrowing
|
|
Amount
|
44,489.79
|
38,287.89
|
55,446.82
|
3,630.29
|
18,368.39
|
1,461.45
|
|
% to total borrowing
|
27.52
|
23.68
|
34.29
|
2.25
|
11.36
|
0.90
|
Credit Rating
The brief details of the ratings received from credit rating agencies by the Company for all its outstanding instruments is given in General Shareholder Information.
Whistle Blower Policy/Vigil Mechanism
The Company has a Whistle Blower Policy encompassing vigil mechanism pursuant to the requirements of section 177(9) of the Act and regulation 22 of the SEBI Listing Regulations. The whistle blower framework has been introduced with an aim to provide employees, directors and value chain partners with a safe and confidential channel to share their inputs about such aspects which are adversely impacting their work environment. The policy/vigil mechanism enables directors, employees and value chain partners to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct or ethics policy and leak or suspected leak of unpublished price sensitive information.
The concerns may be reported anonymously either through email or through a 'Confidential Feedback Mechanism', which is reviewed by a Committee comprising of Senior Management representatives. Pursuant to the Whistle Blower Policy, the summary of incidents investigated, actioned upon, founded and unfounded are reviewed by the Audit Committee on a quarterly basis. Further, the Committee from time to time reviews the functioning of the whistle blower mechanism and measures taken by the Management to encourage employees to avail of the mechanism to report unethical practices.
The Whistle Blower Policy is uploaded on the website of the Company and can be accessed at https://cms-assets.bajajfinserv.in/is/content/bajajfinance/whistle-blower-policy-v2pdf?scl=1 &fmt=pdf
More details are given in Corporate Governance Report.
Independent Directors' Meeting
Pursuant to the Act and SEBI Listing Regulations, the independent directors must hold at least one meeting in a financial year without attendance of non-independent director and members of the Management. Accordingly, independent directors of the Company met on 16 March 2023 and:
• noted the report of performance evaluation from the Chairman of the Board for the year 2022-23;
• reviewed the performance of non-independent directors and the Board as a whole;
• reviewed the performance of the Chairman of the Board, taking into account the views of executive and nonexecutive directors; and
• assessed the quality, quantity and timeliness of flow of information between the Company's Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
The independent directors present elected Anami N Roy as Chairman for the meeting. All independent directors were present at the meeting.
In addition, the independent directors have a separate meeting with the Senior Management team (SMT), during which the SMT is encouraged to express its views and concerns pertaining to the business. Suggestions from the directors are noted by the Management.
RBI Guidelines
The Company continues to fulfil all the norms and standards laid down by RBI pertaining to non-performing assets, capital adequacy, statutory liquidity assets, etc. As against the RBI norm of 15%, the capital to risk-weighted assets ratio of the Company was 24.97% as on 31 March 2023. In line with the RBI guidelines
for asset liability management (ALM) system for NBFCs, the Company has an asset liability committee, which meets monthly to review its ALM risks and opportunities. Further, BFL exceeds the regulatory requirement of liquidity coverage ratio (LCR) introduced by the RBI in FY2020. As against the LCR requirement of 70%, BFL's LCR as on 31 March 2023 was 113%.
The Company continues to be in compliance with the Master Direction for Non-Banking Financial Company-Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank)
Directions, 2016.
Corporate Governance
In terms of the SEBI Listing Regulations, a separate section titled Report on Corporate Governance has been included in this Annual Report, along with the Management Discussion and Analysis and report on General Shareholder Information.
The Managing Director and the Chief Financial Officer have certified to the Board in relation to the financial statements and other matters as specified in the SEBI Listing Regulations.
A certificate from auditors of the Company regarding compliance of conditions of corporate governance is annexed to this Report.
Business Responsibility and Sustainability Report ('BRSR')
Pursuant to amendment in SEBI Listing Regulations, top 1,000 listed entities based on market capitalisation are required to submit a BRSR with effect from FY2023.
Accordingly, the Company has adopted a Policy for Responsible and Sustainable Business Conduct. The BRSR in the format prescribed by SEBI is annexed to the annual report.
The Board has in place an executive level cross functional ESG Committee headed by an Executive Director. The Committee chalks out plans and other initiatives keeping in view the leading practices and the requirements.
It also monitors the implementation of the ESG related initiatives and reporting thereof. A detailed ESG report describing various initiatives, actions and process of the Company towards the ESG endeavor can be accessed at https://www.bajajfinserv.in/finance-investor-relation-annual-reports
Secretarial Standards of ICSI
The Company has complied with the requirements prescribed under the Secretarial Standards on meetings of the Board of Directors (SS-1) and General Meetings (SS-2) read with the MCA circulars.
Internal Audit
The internal audit function provides an assurance to the Audit Committee/Board of Directors and the Senior Management on the quality and effectiveness of the BFL's internal controls, risk management and governance related systems and processes. In line with the RBI's guidelines on Risk Based Internal Audit, the Company has implemented a Risk Based Internal Audit Policy.
At the beginning of each financial year, an audit plan is rolled out after approval of the Audit Committee.
The Audit Committee on a quarterly basis reviews the internal audit reports based on the approved plan, which includes significant audit observations, corrective and preventive actions. The Committee also reviews adequacy and effectiveness of internal controls based on such reports.
The Committee also has independent meetings with the internal auditors without the presence of Management. Auditors and Auditors' Report Statutory Auditors
In line with the RBI requirements, the Board of Directors, based on the recommendation of the Audit Committee, at their meeting held on 16 September 2021, appointed Deloitte Haskins & Sells, Chartered Accountants, (Firm Registration No. 302009E) ('Deloitte') and G. M. Kapadia & Co., Chartered Accountants, (Firm Registration No.104767W) ('G. M. Kapadia') as Joint Statutory Auditors for a period of 3 years to conduct audit of the financial statements of the Company for the financial years 2022, 2023 and 2024. The said appointment was also approved by the shareholders.
The audit report given by Deloitte and G.M. Kapadia, Joint Statutory Auditors for FY2023 is unmodified, i.e., it does not contain any qualification, reservation or adverse remark or disclaimer.
In terms of the RBI Master Directions - Non-Banking Financial Companies Auditors' Report (Reserve Bank) Directions, 2016, the Joint Statutory Auditors have also submitted an additional report dated 27 July 2022, for FY2022 which has been filed with RBI. There were no comments or adverse remarks in the said report as well.
Secretarial Auditor
Pursuant to the provisions of section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed Shyamprasad D. Limaye, Practicing Company Secretary (FCS No. 1587, CP No. 572), to undertake secretarial audit of the Company.
A report from the secretarial auditor in the prescribed Form MR-3 is annexed to this Report.
As per regulation 24A(1) of SEBI Listing Regulations, a listed company is required to annex a secretarial audit report of its material unlisted subsidiary to its Annual Report. The secretarial audit report of BHFL, a material subsidiary (a high value debt listed company) for FY2023 is annexed herewith.
In addition, secretarial audit report pursuant to section 204 of the Act for BFinsec, a non-material subsidiary is also annexed herewith.
Pursuant to regulation 24A(2) of SEBI Listing Regulations, a report on secretarial compliance for FY2023 has been issued by Shyamprasad D. Limaye and the same will be submitted with the stock exchanges within the given timeframe. The report will be made available on the website of the Company.
There are no observations, reservations or qualifications or adverse remark in any of the aforesaid reports.
The auditors, i.e., statutory auditors and secretarial auditor have not reported any matter under section 143(12) of the Act, and therefore, no details are required to be disclosed under section 134(3) (ca) of the Act.
Other Statutory Disclosures
• The financial statements of the Company and its subsidiaries are placed on the Company's website at https://www.bajajfinserv.in/finance-investor-relation-annual-reports
• Details required under the provisions of section 197(12) of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, containing, inter alia, the ratio of remuneration of director to median remuneration of employees, percentage increase in the median remuneration, are annexed to this Report.
• Details of top ten employees in terms of the remuneration and employees in receipt of remuneration as prescribed under rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, containing details prescribed under rule 5(3) of the said rules, which form part of the Directors' Report, will be made available to any member on request, as per provisions of section 136(1) of the Act.
• The Company being an NBFC, the provisions relating to Chapter V of the Act, i.e., acceptance of deposit, are not applicable. Disclosures as per NBFC regulations have been made in this Annual Report.
• The provision of section 148 of the Act relating to maintenance of cost records and cost audit are not applicable to the Company.
• The Company has a policy on prevention of sexual harassment at the workplace. The Board, at its meeting held on 26 April 2023, reviewed the policy and approved amendments to make it gender neutral. The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The number of complaints received, disposed of and pending during FY2023 is given in the Corporate Governance Report.
• There is no change in the nature of business of the Company during FY2023.
• The securities of the Company were not suspended from trading during the year on account of corporate actions or otherwise.
• The Company has not defaulted in repayment of loans from banks and financial institutions. There were no delays or defaults in payment of interest/principle of any of its debt securities.
• During FY2023, the Company has issued non-convertible debenture to the tune of C 19,199.50 crore and redeemed non-convertible debentures and subordinate liability to the tune of C 15,135.80 crore and C 207.10 crore respectively.
• Disclosure under section 197(14) of Companies Act, 2013:
Rajeev Jain, Managing Director (DIN: 01550158)
Post the relinquishment of his position as MD of Bajaj Housing Finance Ltd. a wholly owned subsidiary, he has been elected as Non-Executive Vice Chairman effective from 1 May 2022. In his capacity as a non-executive director, he draws sitting fees and profit linked commission from BHFL at par with other non-executive directors in terms of its remuneration policy. The total remuneration (sitting fees and commission) drawn for FY2023 is C 25.50 lakh. Apart from above, he does not draw any commission from any other subsidiary company.
During FY2023, he has been awarded a one time grant of 94,680 ESOPs of Bajaj Finserv Ltd., holding company ('BFS') at grant price of C 1,482.64. All options will vest entirely post completion of 5 years from grant date.
Anup Saha, Executive Director (DIN: 07640220)
Anup Saha does not draw any commission or remuneration from any of the subsidiary company.
During FY2023, he has been awarded a one time grant of 31,560 ESOPs of BFS at grant price of C 1,482.64. The options will vest entirely post completion of 5 years from grant date.
Rakesh Bhatt, Executive Director (DIN: 02531541)
Rakesh Bhatt does not draw any commission or remuneration from any of the subsidiary company.
During FY2023, he has been awarded a one time grant of 31,560 ESOPs of BFS at grant price of C 1,482.64. The options will vest entirely post completion of 5 years from grant date.
He has also been granted stock option of BFS as per the details given below during his association with BFS-Direct:
|
Grant Date
|
Vesting Schedule
|
Option
Granted
|
Exercise Price (in J)
|
|
16 May 2019
|
|
156,250
|
745.47
|
|
21 May 2020
|
Options will vest 25% each year
|
257,250
|
470.21
|
|
28 April 2021
|
|
131,000
|
1,009.14
|
• As on 31 March 2023, there is no amount remaining unclaimed in respect of non-convertible debentures.
• Neither any application was made, nor any proceeding is pending under the Insolvency and Bankruptcy Code, 2016 against the Company.
• During FY2023, there was no instance of one-time settlement with Banks or Financial Institutions. Therefore, as per rule 8(5) (xii) of Companies (Accounts) Rules, 2014, reasons of difference in the valuation at the time of one-time settlement and valuation done while taking loan from the Banks or Financial Institutions are
not reported.
• Disclosures pursuant to RBI Master Directions, unless provided in the Directors' Report, form part of the notes to the standalone financial statements and Report on Corporate Governance.
Acknowledgement
The Board of Directors places its gratitude and appreciation for the support and cooperation from its members, the RBI and other regulators, banks, financial institutions, trustees for debenture holders and fixed deposit holders.
The Board of Directors also places on record its sincere appreciation for the commitment and hard work put in by the Management and the employees of the Company, its subsidiaries and associates and thanks them for yet an excellent year of performance.
On behalf of the Board of Directors,
CLU
Sanjiv Bajaj
Chairman DIN: 0014615
Pune: 26 April 2023
|