Financial result for half year ending September 30, 2007

GRUH FINANCE LTD.
FINANCIAL RESULTS FOR THE HALF YEAR ENDING SEPTEMBER 30, 2007

The Board of Directors of GRUH Finance Ltd. (GRUH) – a subsidiary of HDFC Ltd., has approved the accounts for the half year ended September 30, 2007 at its meeting held in Mumbai on October 12, 2007.

FINANCIAL RESULTS

GRUH recorded Profit after tax of 11.74 crores for the half year as compared to 6.23 crores for the previous year, a growth of 88%. The rise in profit has been on account of a healthy growth in volume of disbursements of 31%, growth in loan book of 28% and improvement in Net Interest Margin as a result of capital infusion of Rs 60 crores by way of Rights in November 2006. The Net Interest income has shown an increase of 70% on account of the above thereby resulting in the operating profit of 16.39 registering an increase of 95%

LENDING OPERATIONS

During the half year, GRUH disbursed 252.84 crores as against 193.71 crores in the previous year representing a growth of 31%. The sanctions for the half year have been 289.09 crore as against 109.60 crores for the corresponding period of the previous year representing a growth of 38%.

The outstanding loan portfolio at the end of September 30, 2007 stood at 1519.99 crores and has grown by 28%.

The gross NPA as at September 30, 2007 were 34.14 crores which was 2.26% of outstanding loans of 1519.99 crores as against 2.42% in the previous year.

GRUH has continued the practice of building up adequate provisions for contingencies and has set aside 6.00 crores from the current year’s revenues. The total provisions for contingencies carried in the books have been 24.69 crores. As a result, the Net NPA were 9.72 crores i.e.0.64% of the outstanding loans as against 0.91% in the previous year.

GRUH has recently announced a downward revision in its lending rates for new home loan customers effective October 10. 2007. The rates of interest are determined on the basis of a Credit Score methodology and depending on the band in which the credit score falls for an individual, the rate of interest would be determined on the loan. The revised interest rate band for fresh home loans is from 9.75% to 13.25%

RESOURCE RAISING

GRUH’s Fixed Deposit programme has been rated “FAA+” by CRISIL and “MAA+” by ICRA. The rating of “FAA+” and “MAA+” indicates ‘High Safety” as regards repayment of interest and principal. Public Deposits at 150.61 crore have grown from 107.71 crore as in the previous year.

GRUH’s Commercial Paper (CP) is rated at “P1(+)” by CRISIL. During the year, GRUH has raised CP to the tune of 275 crore from the market.

GRUH has recently filed the Shelf Information Memorandum with NSE for its Secured Redeemable Non Convertible Debentures Issue of 300 crores on September 27, 2007. The NCD issue has been rated LAA+ by ICRA

RETAIL OFFICE NETWORK

GRUH has a retail office network of 74 across 5 states of the western region of the country. GRUH has 28 offices in Gujarat, 26 offices in Maharashtra, 8 offices in Karnataka, 7 offices in Madhya Pradesh and 5 offices in Rajasthan.

October 12, 2007