1.  During the year, the Company obtained approval of shareholders at
 the Extra-Ordinary General Meeting held on 18th May, 2010, for
 placement of Equity Shares to Qualified Institutional Buyers (QIBs) and
 preferential issue of Equity Shares to Promoters/Promoter Group and
 Caledonia Investment Plc. The Committee of the Board of Directors has
 from time to time, issued and allotted shares along with Equity Shares
 under ESOS scheme as under:
 
 (a) On 2nd June, 2010, issued and allotted to QIBs 1,68,69,095 Equity
 Shares of Rs. 10/- each, at a price of Rs. 222.30 per Equity Share
 (including a premium of Rs. 212.30 per Equity Share), aggregating to Rs.
 37,500 lacs.
 
 (b) On 12th June, 2010, issued and allotted to Promoters/Promoter Group
 40,00,000 Equity Shares of Rs. 10/- each, at a price of Rs. 222.30 per
 Equity Share (including a premium of Rs. 212.30 per Equity Share),
 aggregating to Rs. 8,892.00 lacs.
 
 (c) On 12th June, 2010, issued and allotted to Caledonia Investment Plc
 10,00,000 Equity Shares of Rs. 10/- each, at a price of Rs. 222.30 per
 Equity Share (including a premium of Rs. 212.30 per Equity Share),
 aggregating to Rs. 2,223.00 lacs.
 
 (d) During the year, the Company has allotted, from time to time,
 291,930 number of Equity Shares of Rs. 10/- each to various eligible
 employees under (ESOS 2008) at a price of Rs. 53.65 per Equity Share
 (including a premium of Rs. 43.65 per Equity Share) aggregating to Rs.
 156.62 lacs as approved in the AGM dated 23rd July, 2007 and allotted
 at the reconsidered price approved in the EOGM dated 31st March, 2009.
 
 (e) During the year, the Company has allotted, from time to time,
 238,833 number of Equity Shares of Rs. 10/- each to various eligible
 employees under (ESOS 2009) at a price of Rs. 141/- per Equity Share
 (including a premium of Rs. 131/- per Equity Share) aggregating to Rs.
 336.75 lacs as originally approved in the AGM dated 23rd July, 2007.
 
 2.  Non Convertible Debentures (NCD) amounting to Rs. 119,066.64 lacs (Rs.
 63,716.61 lacs) are secured /to be secured by way of first charge as
 per note B-4 herein below and are redeemable at par, in one or more
 installments, on various dates, with the earliest redemption being 23rd
 May, 2011 and the last being 22nd October, 2020.
 
 3.  The Company has raised Rs. 58,000.00 lacs through issue of long term
 Unsecured, Redeemable, Non Convertible Debentures. These Debentures are
 redeemable at par between 28th December, 2012 and 31st March, 2021.
 These Debentures are Sub-ordinate to present and future senior debt
 holders of the Company and qualifies as Tier II Capital under the NHB
 Guidelines.
 
 4.  Secured term loans from the National Housing Bank, other Banks,
 International Finance Corporation (IFC Washington), Asian Development
 Bank (ADB, Manila), Financial Institutions and Secured Non Convertible
 Debentures are secured/to be secured by way of first charge to and in
 favour of participating banks, Institutions, National Housing Bank and
 Debenture Trustees jointly ranking pari passu inter-se, on the
 Company''s whole of the present and future book debts outstanding,
 investments including all the receivables of the Company and other
 movable assets wherever situated excluding SLR investments read with
 Note no. 8 hereinafter. They are further secured / to be secured on
 pari passu basis by constructive delivery of various title deeds of
 certain immovable properties, to Union Bank of India, acting for itself
 and as an agent of other participating lenders and Debenture trustees,
 and are also guaranteed by some of the present and earlier directors of
 the Company.
 
 5.  Term loans include cash credit received from banks Rs. 99.11 lacs and
 are secured on pari passu basis with other term loans.
 
 6.  As certified by the Management, loans given by the Company are
 secured by Equitable Mortgage/Registered Mortgage of the Property and
 Assets Financed and/or assignment of Life Insurance Policies and/or
 Personal Guarantees and/or undertaking to create a security and are
 considered appropriate and good.
 
 7.  The Company had earlier allotted 30 lacs Non Convertible Redeemable
 Preference Shares (NCRPS), of Rs. 10/- each at a premium of Rs. 90/- per
 share, aggregating to Rs. 3,000 lacs, carrying dividend @ 1% per annum on
 10th December, 2007 which were redeemable at the end of 36 months from
 the date of allotment @ Rs. 136/- per share. During the year, the Company
 has redeemed all the above NCRPS @ Rs. 136/- per share and has utilised
 the share premium for redemption on pro rata basis.
 
 8.  As the National Housing Bank directives require all HFC''s accepting
 public deposits to create a floating charge on the statutory liquid
 assets maintained in favour of depositors through the mechanism of a
 trust deed.  The Company has appointed in earlier year a SEBI approved
 trustee Company i.e. GDA Trustee and Consultancy Ltd. as trustee for
 the above by executing the trust deed and has created necessary
 required charge.
 
 9.  The Non Performing Assets (NPA) consisting of principal loans
 outstanding where payments of EMI/PEMI were in arrears for 90 days or
 more amounted to Rs. 9,429.07 lacs (Rs. 10,048.28 lacs). As per prudential
 norms prescribed by the NHB, the Company is required to carry a
 contingency provision of Rs. 3,641.60 lacs (Rs. 1,911.06 lacs) in respect
 of Non Performing Housing Loan, Non-Housing Standard Assets and Other
 Loan Assets. The Company has also provided for Rs. 59.15 lacs (Rs. 125.51
 lacs) in respect of diminution in the value of Investment. The Company
 has Written off Rs. 144.05 lacs (Rs. 98.34 lacs) as bad debts and by way of
 one time settlement to recover some of its NPA and Loss Accounts. The
 Company has withdrawn Rs. 144.05 lacs (Rs. 98.34 lacs) from contingency
 provisions created out of profits of earlier years.  The Company has
 made, during the year, provision of Rs. 900 lacs (Rs. 850 lacs) for
 contingencies and has excess provision over and above the requirements
 of the guidelines on Prudential Norms issued by the National Housing
 Bank (NHB). The amount of required provision based on Non Performing
 Assets is as hereunder:
 
 10. Composite Loans sanctioned (i.e. loans allowed for purchase of plot
 and self construction of house) on or before 31st March, 2009, in which
 construction has not started till 31st March, 2011, as per the
 information available with the Company, is excluded from Housing Loans
 and regrouped under Other Loans (Non Housing) in Schedule ''G'',
 outstanding as on 31st March, 2011 aggregating to Rs. 1,097.05 lacs.  The
 previous year figures of Housing Loans and Other Loans have not been
 regrouped, hence are not comparable.
 
 11. In terms of the requirement of the National Housing Bank (NHB)
 Circular No.NHB (ND)/DRS Pol. No.  37/2010-11 dated 24th December,
 2010, the Company has met the said requirements as under by utilizing
 excess provisions made in the earlier period and by further providing
 during the year:
 
 i.  0.40% on all Standard Assets in respect of all loans other than
 individual housing loans, and
 
 ii.  2% on total outstanding Standard Assets in respect of Housing
 Loans given on Dual Interest Rate Scheme,
 
 12. Retirement Benefit Plans
 
 ii. As required under Accounting Standard 15 (AS 15 Revised, 2005) the
 Company has made full provision for future gratuity liability & leave
 encashment liability payable at the time of retirement as on 31st
 March, 2011.  On the basis of Gratuity and GLES report under Accounting
 Standard 15 (AS 15 Revised, 2005) provided by LIC of India, the Company
 has made necessary full contribution to LIC of India of its own
 liabilities as well as liabilities of its Subsidiary Company, DHFL
 Property Services Limited.
 
 13. Employee Stock Option Scheme:
 
 Employee Stock Option Scheme 2008 (ESOS-2008) was implemented by the
 Company. 14,22,590 Equity Share options were granted under (ESOS-2008)
 in 2008-09 to the employees as approved by the Remuneration and
 Compensation Committee of Directors of the Company at Rs. 53.65 per
 share, the reconsidered price approved in the EOGM dated 31st March,
 2009.
 
 Employee Stock Option Scheme 2009 (ESOS-2009) was implemented by the
 Company. 12,75,000 Equity Share options were granted under (ESOS-2009)
 in 2009-10 and additional 73,470 Equity Share options were granted
 under (ESOS-2009) in 2010-11 to the employees as approved by the
 Remuneration & Compensation Committee of the Directors of the Company
 at Rs. 141/- per share, the price approved in the Remuneration and
 Compensation Committee meeting held on 25th November, 2009.
 
 During the financial year 2010-11, under (ESOS-2008), 372,260 options
 vested with eligible employees, 291,930 Equity Share options were
 exercised leaving balance of 80,330 Equity Share options exercisable at
 the end of the year and 184,222 Equity Share options lapsed during the
 year while 614,310 Equity Share options were unvested at the end of the
 year.
 
 During the financial year 2010-11, under (ESOS-2009), 346,803 options
 vested with eligible employees, 238,833 Equity Share options were
 exercised leaving balance of 107,970 Equity Share options exercisable
 at the end of the year and 92,270 Equity Share options lapsed during
 the year while 877,147 Equity Share options were unvested at the end of
 the year.
 
 Method used for accounting for share based payment plan:
 
 The Company has used intrinsic value method, which is the amount by
 which quoted market price of the underlying shares exceeds the exercise
 price of the Equity Share options, for accounting the compensation cost
 of its options to employees of the Company on date of the grant. As the
 Equity Share options under (ESOS-2008) were granted at the market
 price, the intrinsic value of the Equity Share option was NIL.  However
 for Equity Share options under (ESOS-2009) the intrinsic value of such
 options was Rs. 43.95.
 
 Fair Value methodology:
 
 The fair value of options used to compute ESOP adjusted net income and
 earnings per Equity Shares have been estimated using Black Scholes
 Option Pricing model as provided by independent consultants and relied
 upon by the Management and the auditors.
 
 14. During the year, the Company has subscribed 500 lac fully paid up
 Equity Shares of Rs. 10/- each for cash at par of Aadhar Housing Finance
 Private Limited. Aadhar Housing Finance Private Limited is a joint
 venture between the Company, its subsidiary DHFL Vysya Housing Finance
 Limited and International Finance Corporation (private sector arm of
 World Bank) with shareholding of 50%, 30% and 20% respectively to
 promote financing of low cost housing in rural and semi urban areas of
 the selected states of the country.
 
 15. During the year, the Company has promoted, subscribed and acquired
 2,160.10 lac fully paid up Equity Shares of Rs. 10/- each for cash at par
 of DHFL Holdings Private Limited, being 100% shares of the Company and
 promoted as a Special Purpose Vehicle for acquiring and holding
 21,99,45,206 Equity Shares of Rs. 10/- each fully paid up, representing
 67.56% of the Equity of Deutsche Postbank Home Finance Limited by
 investing Rs. 73,552.47 lacs.
 
 16. During the year, a Company led consortium acquired 100% Equity
 Share capital of Deutsche Postbank Home Finance Limited from BHW
 Holding AG, Germany under a share purchase agreement whereby the
 Company has acquired above shares through DHFL Holdings Private
 Limited.
 
 17. Unsecured Loans includes short term loans (Deposits and Commercial
 Papers) due and payable within one year Rs. 34,299.13 lacs (Rs. 6,374.28
 lacs).
 
 18. During the year, the Company has utilized Rs. 2,949.52 lacs (Rs. 360
 lacs) out of share premium account in accordance with Section 78 of the
 Companies Act, 1956 towards premium payable on the redemption of Non
 Convertible Redeemable Preference Shares of the Company.
 
 19. Other income includes Rent income of Rs. 141.59 lacs (Rs. 117.77 lacs)
 and Miscellaneous income of Rs. 47.20 lacs (Rs. 81.54 lacs).
 
 21. The Company has sold during the year, 13,21,510 number of shares
 being part of its strategic investment in erstwhile Promoter Group
 Company for Rs. 3,585.77 lacs thereby earning exceptional tax free income
 of Rs. 3,542.95 lacs.
 
 22. The Company has created a Contingency Reserve of Rs. 3,500 lacs in
 view of the above exceptional income to provide for future
 contingencies.
 
 23. As per Accounting Standard (AS 18) on Related Party Disclosures
 details of transactions with related parties as defined therein are
 given below:
 
 A) List of related parties with whom transactions have taken place
 during the year and relationship:
 
 1) COMPANIES
 
 (i) Subsidiary Companies
 
 (a) DHFL Vysya Housing Finance Ltd.
 
 (b) DHFL Property Services Ltd.
 
 (c) DHFL Holdings Pvt. Ltd.
 
 (d) Aadhar Housing Finance Pvt. Ltd.
 
 (e) Deutsche Postbank Home Finance Ltd.
 
 (f) DPB Financial Consultants Ltd.
 
 (ii) Associate Companies
 
 (a) DHFL Insurance Services Ltd.
 
 (b) DHFL Venture Capital Fund ( Trust)
 
 (c) DHFL Venture Capital India Pvt. Ltd.
 
 (d) DHFL Venture Trustee Company Pvt. Ltd.
 
 (e) Dish Hospitality Pvt. Ltd.
 
 (f) Wadhawan Holdings Pvt. Ltd. [WHPL]
 
 (g) Wadhawan Retail Pvt. Ltd.  
 
 (h) Wadhawan Housing Pvt. Ltd.  
 
 (i) Caledonia Investments Plc.
 
 2) OTHERS
 
 (a) Shri Dheeraj Wadhawan
 
 (b) Smt. Aruna Wadhawan
 
 (c) Smt. Pooja Wadhawan
 
 3) KEY MANAGEMENT PERSONNEL
 
 (a) Shri Kapil Wadhawan Chairman & Managing Director
 
 (b) Shri Anil Sachidanand Chief Executive Officer
 
 (c) Shri Rajeev Sathe Chief Operating Officer
 
 24. The Company''s Income Tax assessment has been completed up to
 Assessment Year 2008-09. Additional demands of Rs. 195.84 lacs have been
 raised by the department which are pending in appeal. The Company has
 deposited additional tax so demanded which is pending in appeals. No
 provision has been made as the Company has been advised that appeals
 will be allowed, in due course of time, based on similar case laws on
 the subject and there is no need to make any provision for the same and
 refunds are expected to be received.
 
 25. The Company has derecognized Interest income on Non-Performing
 Assets as on 31st March, 2011 of Rs. 438.89 lacs (Rs. 610.33 lacs).
 
 26. Dividend includes Rs. 161.22 lacs (Rs. 103.02 lacs) and Interest income
 includes Rs. 58.17 lacs (NIL) received from Subsidiary Company. Interest
 payment includes Rs. NIL (Rs. 40.21 lacs) paid to Subsidiary Company.
 
 27. Provision for Taxation includes Rs. 6,460.89 lacs (Rs. 5,193.58 lacs)
 provision for current year tax, and Rs. 1,170.45 lacs (Rs. - 43.58 lacs)
 deferred tax liability for the year.
 
 28. The main business of the Company is to provide loans for the
 purchase or construction of residential houses and all other activities
 of the Company revolve around the main business and as such there are
 no separate reportable segments as specified in Accounting Standard (AS
 17) on Segment Reporting, and under paragraph 29 (2) of the Housing
 Finance Companies (NHB) Directions, 2010, which needs to be reported.
 
 29. Estimated amount of contracts remaining to be executed on capital
 account and not provided for (net of advances) is Rs. 5,767.74 lacs (Rs.
 5,557.99 lacs).
 
 30. Capital Work in Progress includes Rs. 16,000.00 lacs paid as advance
 consideration for acquiring office premises under construction, Rs.157.58
 lacs paid for software and Rs.450.00 lacs paid in lieu of part
 consideration towards sale of leasehold land in earlier years.
 
 31. The Company has paid dividend of Rs. 659.36 lacs and Rs.112.06 lacs as
 tax on distribution of dividend to new shareholders on account of final
 dividend for the year 2009-10 as required under the Listing Agreement
 as those shares were allotted prior to record date for the dividend
 payment and after the date of earlier year Balance Sheet.
 
 32. There is no amount due and payable to ''Suppliers'' registered under
 the Micro, Small and Medium Enterprises Development Act, 2006 at the
 end of the year. No interest has been paid/is payable by the Company
 during/for the year to these ''Suppliers''. The above information takes
 into account only those suppliers who have responded to the inquiries
 made by the Company for this purpose.
 
 33. Figures for the previous year have been regrouped, rearranged and
 reclassified wherever necessary.  Accordingly, amounts and other
 disclosure for the previous year are included as an integral part of
 the current year''s financial statement and are to be read in relation
 to the amounts and other disclosures relating to the current year.
 
 34. Figures in brackets represent previous year''s figures.