blueplastfin

C M Y K

ProspectusPlease read Section 60B of the

Companies Act, 1956Dated May 13, 2006

BLUPLAST INDUSTRIES LIMITED(Incorporated as a Private Limited Company in Mumbai on January 14, 1999 under the Companies Act, 1956 as “Thermoplast Industries Private Limited”,renamed as “Bluplast Industries Private Limited” w.e.f. March 11, 2005 and subsequently converted into a Public Limited Company on July 14, 2005)

Registered Office: 113/114, Vivek Industrial Estate, Uswala Road, Near Litolier, Cama Estate, Goregaon (East), Mumbai-400063(with effect from April 4th 2001)

(Previous Registered Office, On incorporation: 108, Udyog Bhavan, Sharma Industrial Estate, Goregaon (E), Mumbai - 400 063)Tel: 022 - 26851212 / 1631 / 2897 Fax: 022 – 26851151

Corporate Office: 128, Udyog Bhawan, Sonawala Road, Goregaon (E), Mumbai – 400 063Tel: 022 - 26852816 Fax: 022 – 26852816

Email: [email protected] Website: www.bluplast.comContact Person: Mr. Shashinand Nagori, Compliance Officer, Tel: 022 – 26851631, E-mail: [email protected]

PUBLIC ISSUE OF 1,10,00,000 EQUITY SHARES OF RS. 10/- EACH ISSUED FOR CASH AT A PRICE OF RS. 32/- PER EQUITYSHARE AGGREGATING TO RS. 3520 LAKHS (HEREINAFTER REFFERED TO AS THE ‘ISSUE’) BY BLUPLAST INDUSTRIESLIMITED (THE ‘COMPANY’ OR ‘ISSUER’). THE ISSUE COMPRISES OF 10,00,000 EQUITY SHARES OF RS. 10/- EACH FOR CASH ATA PRICE OF RS. 32/- PER EQUITY SHARE AGGREGATING TO RS. 320 LAKHS FOR SUBSCRIPTION BY EMPLOYEES OF THECOMPANY AND NET ISSUE TO THE PUBLIC OF 1,00,00,000 EQUITY SHARES OF RS. 10/- EACH FOR CASH AT A PRICE OF RS.32/- PER EQUITY SHARE AGGREGATING TO RS. 3200 LAKHS. THE ISSUE WILL CONSTITUTE 58.77% OF THE FULLY DILUTEDPOST ISSUE PAID UP CAPITAL OF THE COMPANY.

THE ISSUE PRICE IS 3.2 TIMES OF THE FACE VALUE

RISK IN RELATION TO THE FIRST ISSUE TO THE PUBLIC

This being the first issue of the Equity Shares of Bluplast Industries Limited (“the Company”), there has been no formal marketfor the Equity Shares of the Company. The face value of the Equity Shares of the Company is Rs. 10/- per share and the IssuePrice is 3.2 times of the face value. The Issue Price (as determined and justified by the Lead Managers and the Company asstated herein under the paragraph ‘Basis of Issue Price’) should not be taken to be indicative of the market price of the EquityShares after the Equity Shares are listed. No assurance can be given regarding an active and / or sustained trading in theEquity Shares of the Company or regarding the price at which the Equity Shares will be traded after listing.

GENERAL RISKS

Investments in equity and equity related securities involve a degree of risk and investors should not invest any funds in thisIssue unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefullybefore taking an investment decision in this Issue. For taking an investment decision, investors must rely on their ownexamination of the Company and the Issue including the risks involved. The Equity Shares offered in the Issue have not beenrecommended or approved by the Securities and Exchange Board of India (SEBI), nor does SEBI guarantee the accuracy oradequacy of this Prospectus. The issue is not graded by any Credit Rating Agency.

Specific attention of the investors is invited to the section titled ‘Risk Factors’ beginning on page iii of this Prospectus.

ISSUER’S ABSOLUTE RESPONSIBILITY

The Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Prospectus contains allinformation with regard to the Company and the Issue, which is material in the context of the Issue, that the informationcontained in this Prospectus is true and correct in all material aspects and is not misleading in any material respect, that theopinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makesthis Prospectus as a whole or any of such information or the expression of any such opinions or intentions misleading in anymaterial respect.

LISTING

The Equity Shares offered through this Prospectus are proposed to be listed on Bombay Stock Exchange Limited (BSE) andNational Stock Exchange of India Limited (NSE). The in-principle approval of BSE and NSE for the listing of our Equity Shareshave been received pursuant to letters dated February 24, 2006 and March 8, 2006, respectively. BSE shall be the DesignatedStock Exchange.

ISSUE PROGRAMMEISSUE OPENS ON : 5th JUNE, 2006 ISSUE CLOSES ON : 9th JUNE, 2006

LEAD MANAGER TO THE ISSUE REGISTRARS TO THE ISSUE

ALLIANZ SECURITIES LIMITED33, Vaswani Mansion, 6th Floor, Dinshaw Vachha RoadChurchgate, Mumbai – 400 020Phone: 022-22870580Fax: 022-22870581Email: [email protected]: www.aslfinancial.comContact Person: Ms. Kavitha Basavaraj

BIGSHARE SERVICES PRIVATE LIMITEDE /2, Ansa Industrial Estate, Saki Vihar RoadSaki Naka, Andheri (East), Mumbai – 400 072.Tel: +91-22-28473747 / 3474/0652/0653;Fax: +91-22-28475207Website: www.bigshareonline.comE-Mail: [email protected] Person: Mr. V. Kumaresan

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A H E A LT H Y C H O I C E

TABLE OF CONTENTSPAGE NO.

SECTION I: GENERAL

DEFINITIONS, ABBREVIATIONS & TECHNICAL TERMS ................................................................................... a

SECTION II: RISK FACTORS

CERTAIN CONVENTIONS; USE OF MARKET DATA ........................................................................................... iFORWARD LOOKING STATEMENTS .................................................................................................................... iiRISK FACTORS .................................................................................................................................................... iii

SECTION III: INTRODUCTION

SUMMARY .............................................................................................................................................................. 1SUMMARY OF FINANCIAL/OPERATING DATA ..................................................................................................... 3THE ISSUE ............................................................................................................................................................ 5GENERAL INFORMATION ..................................................................................................................................... 6CAPITAL STRUCTURE OF THE COMPANY ...................................................................................................... 10OBJECTS OF THE ISSUE................................................................................................................................... 19BASIS FOR ISSUE PRICE .................................................................................................................................. 30STATEMENT OF TAX BENEFITS ...................................................................................................................... 32

SECTION IV: ABOUT THE COMPANY

INDUSTRY OVERVIEW ....................................................................................................................................... 39

OUR BUSINESS .................................................................................................................................................. 43

REGULATIONS AND POLICIES .......................................................................................................................... 49

HISTORY AND CERTAIN CORPORATE MATTERS .......................................................................................... 50MANAGEMENT .................................................................................................................................................... 52PROMOTERS ...................................................................................................................................................... 59INFORMATION ON THE PROMOTER GROUP COMPANIES ........................................................................... 60CURRENCY OF PRESENTATION ....................................................................................................................... 64RELATED PARTY TRANSACTIONS ................................................................................................................... 65DIVIDEND POLICY .............................................................................................................................................. 69

SECTION V: FINANCIAL INFORMATION OF THE COMPANYFINANCIAL STATEMENTS OF THE COMPANY ................................................................................................ 70MANAGEMENT’S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION AND RESULTSOF THE OPERATIONS ........................................................................................................................................ 91

SECTION VI: LEGAL AND OTHER INFORMATION

DETAILS OF OUTSTANDING LITIGATIONS ...................................................................................................... 95GOVERNMENT APPROVALS / LICENSING ARRANGEMENTS ..................................................................... 100SECTION VII: OTHER REGULATORY AND STATUTORY DISCLOSURES ................................................... 102

SECTION VIII: ISSUE RELATED INFORMATION

TERMS OF THE ISSUE ..................................................................................................................................... 108

ISSUE PROCEDURE ......................................................................................................................................... 110

SECTION IX: MAIN PROVISIONS OF ARTICLES OF ASSOCIATION OF THE COMPANY .......................... 119

SECTION X: MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION ............................................ 136

SECTION XI: DECLARATION ........................................................................................................................... 137

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SECTION I

DEFINITIONS AND ABBREVIATIONS

Conventional / General Terms

Terms Description

Articles/Articles of Association Articles of Association of Bluplast Industries Limited

Companies Act/ Act The Companies Act, 1956, as amended from time to time

Depository A company formed and registered under the Companies Act, 1956 (1 0f1956), and which has been granted a certificate of registration under sub-section (1A) of section 12 of the Securities and Exchange Board of Indiaof India Act, 1992 (15 of 1992)

Depositories Act The Depositories Act, 1996, as amended from time to time

Depository Participant A depository participant as defined under the Depositories Act

FEMA Foreign Exchange Management Act, 1999, as amended from time to time,and the regulations framed there under

FII Foreign Institutional Investor (as defined under FEMA (Transfer or Issueof Security by a Person Resident Outside India) Regulations, 2000)registered with SEBI

Financial Year/Fiscal/FY Period of twelve months ended March 31 of that particular year, unlessstated otherwise

Government/GOI The Government of India

Indian GAAP Generally Accepted Accounting Principles in India

I.T. Act The Income-Tax Act, 1961, as amended from time to time

MOA/Memorandum/ Memorandum of Association of Bluplast Industries LimitedMemorandum of Association

NRIs/ Non-Resident Indian A person resident outside India who is a citizen of India or a Person ofIndian Origin (as defined in Foreign Exchange Management (Deposit)Regulations, 2000)

Overseas Corporate Body / OCB A Company, partnership, society and other corporate body owned directlyor indirectly to the extent of at least 60% by NRIs including overseas trusts,in which not less than 60% of beneficial interest is held by NRIs directlyor indirectly but irrevocably as defined in Foreign Exchange Management(Deposit) Regulations, 2000

SEBI The Securities and Exchange Board of India constituted under the SEBIAct, 1992

SEBI Act Securities and Exchange Board of India Act, 1992, as amended from timeto time

SEBI Guidelines SEBI (Disclosure and Investor Protection) Guidelines, 2000 issued by SEBIon January 27, 2000, as amended, including instructions and clarificationsissued by SEBI from time to time

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BLUPLAST INDUSTRIES LIMITED

Terms Description

Stock Exchanges Bombay Stock Exchange Limited (BSE) and National Stock Exchange ofIndia Limited (NSE)

U.S. GAAP Generally Accepted Accounting Principles in the United States of America

ISSUE RELATED TERMS

Terms Description

Allianz Allianz Securities Limited

Applicant Any prospective investor who makes an application for Equity Shares interms of this Prospectus

Application Form The form in terms of which the applicant shall apply for the Equity Sharesof the Company

Allotment Issue of Equity Shares pursuant to the Issue to the successful Applicants

Allottee The successful Applicant to whom the Equity Shares are being / havebeen issued.

Terms Description

Bankers to the Issue Corporation Bank, Standard Chartered Bank, UTI Bank Ltd. and ICICI BankLtd.

Depository A depository registered with SEBI under the SEBI (Depositories andParticipant) Regulations, 1996 as amended from time to time

Depository Participant A depository participant as defined under the Depositories Act

Designated Stock Exchange Bombay Stock Exchange Limited (BSE)

Prospectus This Prospectus issued in accordance with Section 60 of the CompaniesAct, 1956. It carries the same obligations as are applicable in case of aProspectus and will be filed with RoC before the Issue opening date.

Eligible Employees Employees who are on the payroll of the Company as on 31st March, 2006

Employee Reservation Portion The portion of the Issue being a maximum of 10,00,000 Equity Sharesavailable for allocation to employees as on March 31, 2006.

Issue Closing Date The date on which the Issue closes for subscription

Issue Opening Date The date on which the Issue opens for subscription

Issue Price The price as decided by the Company and the Lead Managers for whichthe Equity Shares shall be issued to the public in terms of this Prospectus

LM/Lead Manager Lead Manager to the Issue, in this case being Allianz Securities Limited

Net Issue/ Net Issue to the Public Public Issue less reservation for employees of the company to the extentof 10,00,000 equity shares i.e. Net Issue to Public is of 1,00,00,000 EquityShares of Rs. 10/- each for Cash at a Price of Rs. 32 per Equity Share

Prospectus Refers to the prospectus to be filed with the Registrar of Companies (ROC)

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Terms Description

Public Issue/ /Issue/Fresh Issue Public Issue of 1,10,00,000 Equity Shares of Rs. 10/- each for Cash at aPrice of Rs. 32 per Equity Share aggregating to Rs. 3520 Lakhs

Registrar/Registrar to the Issue Registrar to the Issue being Bigshare Services Private Limited

ROC / Registrar of Companies Registrar of Companies, Maharashtra, situated at Everest, Marine Lines,Mumbai 400002.

Retail Individual Investors Individual investors who apply for the Equity Shares of or for a value ofnot more than Rs.1,00,000

Company/Industry Related Terms

Terms Description

Auditors The Statutory Auditors of the Company viz Singrodia Goyal & Co.

Board/Board of Directors Board of Directors of Bluplast Industries Limited

Committee Committee of the Board of Directors of the Company authorised to takedecisions on matters related to or incidental to this Issue

Corporate Office 128, Udyog Bhawan, Sonawala Road, Goregaon (E), Mumbai – 400 063.

The Company/ BIL/ Bluplast/ Bluplast Industries Limited, a public limited company incorporated underBluplast Industries Limited/ / the Companies Act, 1956Bluplast Industries Pvt. Ltd. /We/ Us/ Our Company/ The Issuer

Equity Shares Equity Shares of the Company of Rs.10 each unless otherwise specifiedin the context thereof

Face Value Value of paid up equity capital per Equity Share, in this case being Rs.10each

Registered Office/Registered 113/114, Vivek Industrial Estate, Uswala Road, Near Litolier, Cama Estate,Office of the Company Goregaon (East), Mumbai-400063

Promoters Mr. Kamlesh L. Jain, Mr. Indermal P.Jain, Ms. Rekha Jain, Ms. NayanaJain

“Promoter Group” or “Promoter Refers to Bluplast Moulders Private Limited, Bluplast Corporation, AlaskaGroup Entities” or “Group Industries, Neelam Plastic Industries, Bluplast Industries, Bluplast PentechCompanies” and Bluplast Utility Products

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Abbreviations of General Terms

Abbreviation Full Form

AS Accounting Standards as issued by the Institute of Chartered Accountants of India

AY Assessment Year

BSE Bombay Stock Exchange Limited

CDSL Central Depository Services (India) LimitedCESTAT Customs, Excise and Service Tax Appellate Tribunal.

EPS Earning Per Share

EGM Extraordinary General Meeting

FY / Fiscal/Financial Year Period of twelve months ended March 31 of that particular year, unless otherwisestated

FEMA Foreign Exchange Management Act, 1999

FII Foreign Institutional Investors

GDP Gross Domestic Production

GoI/Government Government of India

GIR Number General Index Registry NumberHUF Hindu Undivided Family

I.T. Act Income Tax Act, 1961, as amended from time to time

KVA Kilovolt Amperes

MOU Memorandum of Understanding

MTPA Metric Tone Per AnnumMM Millimetres

MTS Metres

NAV Net Asset Value

NRIs Non Resident Indians

NSE National Stock Exchange of India Limited

O.I.A Order In AppealO.I.O Order In Original

p.a. Per annum

P/E Ratio Price/Earnings Ratio

PAN Permanent Account Number

PAT Profit After Tax

PVC Polyvinyl ChlorideRBI The Reserve Bank of India

RCC Reinforced concrete cement

ROC Registrar of Companies, Maharashtra, Mumbai

RONW Return on Net Worth

Rs. / Rupees / INR Indian Rupees

Sq. ft. Square feetUSD/US$ United States Dollar

WPC Wood Plastic Composite

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SECTION – II

RISK FACTORS

CERTAIN CONVENTIONS; USE OF MARKET DATA

In the prospectus, unless the context otherwise requires, all references to one gender also refers to the other gender.

Unless the context otherwise requires, the financial data in this Prospectus is derived from our financial statementsprepared and restated in accordance with Indian GAAP and included in this Prospectus. Accordingly, financialinformation relating to us is presented on a non-consolidated basis for the year ended March 31 2002, 2003, 2004,2005 and 2006. Our fiscal year commences on April 1 and ends on March 31. In this Prospectus, any discrepanciesin any table between the total and the sums of the amounts listed are due to rounding-off.

There are significant differences between Indian GAAP and U.S. GAAP; accordingly, the degree to which the IndianGAAP financial statements included in this Prospectus will provide meaningful information, is entirely dependent onthe reader’s level of familiarity with Indian accounting practices. Any reliance by persons not familiar with Indianaccounting practices on the financial disclosures presented in this Prospectus should accordingly be limited. Wehave not attempted to explain those differences or quantify their impact on the financial data included herein, andwe urge you to consult your own advisors regarding such differences and their impact on our financial data.

For additional definitions, see the section titled ‘Definitions and Abbreviations’ on page b of this Prospectus. In thesection titled ‘Main Provisions of Articles of Association of the Company’ beginning on page 119 of this Prospectus,defined terms have the meaning given to such terms in the Articles of Association of the Company.

Market data used throughout this Prospectus was obtained from internal company reports and industry publications.Industry publications generally state that the information contained in those publications has been obtained fromsources believed to be reliable but their accuracy and completeness are not guaranteed and their reliability cannotbe assured. Although we believe market data used in this Prospectus is reliable, it has not been independentlyverified. Similarly, internal company reports, while believed by us to be reliable, have not been verified by anyindependent sources.

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FORWARD-LOOKING STATEMENTS

Statements included in this Prospectus which contain words or phrases such as “will”, “aim”, “will likely result”,“believe”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “future”, “objective”,“goal”, “project”, “ should”, “will pursue” and similar expression or variations of such expressions, are “forward-lookingstatements”.

All forward looking statements are subject to risks, uncertainties and assumptions that could cause actual resultsto differ materially from those contemplated by the relevant forward looking statement. Important factors that couldcause actual results to differ materially from our expectations include, among others: -

� General economic and business conditions in India and other countries

� Regulatory changes relating to the plastic industry sector in India and our ability to respond to them

� General economic and business conditions in India and other countries;

� Our ability to successfully implement our strategy, our growth and expansion, technological changes, ourexposure to market risks that have an impact on our business activities or investments;

� The monetary and fiscal policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreignexchange rates, equity prices, the performance of the financial markets in India and globally, changes in domesticand foreign laws, regulations and taxes and changes in competition in our industry;

� Changes in the value of the Rupee and other currencies;

� The occurrence of natural disasters or calamities;

� Change in political conditions in India.

For further discussion of factors that could cause our actual results to differ, see the section titled “Risk Factors”beginning on page iii of this Prospectus. By their nature, certain market risk disclosures are only estimates andcould be materially different from what actually occurs in the future. As a result, actual future gains or losses couldmaterially differ from those that have been estimated. Neither the Company nor any of their respective affiliateshave any obligation to update or otherwise revise any statements reflecting circumstances arising after the datehereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come to fruition.In accordance with SEBI requirements, the Company, and the Lead Manager will ensure that investors in India areinformed of material developments until such time as the grant of listing and trading permission by the StockExchanges.

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II. RISK FACTORS

An investment in Equity Shares involves a high degree of risk. You should carefully consider all the information inthis Prospectus, including the risks and uncertainties described below, before making an investment in the EquityShares of the Company. If any of the following risks actually occur, the business, results of operations and financialcondition could suffer, the trading price of the Equity Shares of the Company could decline and you may lose all orpart of your investment.

Prior to making an investment decision, prospective investors should carefully consider all of the information containedin this Prospectus, including financial statements included in this Prospectus beginning on page 70. Unless statedotherwise, the financial data in this section is as per our financial statements prepared in accordance with IndianGAAP.

Unless specified or quantified in the relevant risk factors below, we are not in a position to quantify the financial orother implications of any of the risks described in this section.

INTERNAL RISK FACTORS

1. Promoter Mr. Kamlesh Jain is involved in one criminal case under section 138 of Negotiable InstrumentAct, 1882 filed against him in his capacity as one of the Director of Plusmore Marketing Pvt. Ltd.

A criminal case under Section 138 of the Negotiable Instruments Act, 1882 has been filed against M/s PlusmoreMarketing Pvt. Ltd. and its directors on account of dishonour of certain cheques aggregating to Rs. 2,23,460/-. Mr. KamleshJain has been made a party to the criminal case since he used to be a director of M/s Plusmore MarketingPvt. Ltd. However, at the time of dishonour of the cheques and the subsequent initiation of the case againstM/s Plusmore Marketing Pvt. Ltd., Mr. Kamlesh Jain had already resigned as a director. For more details,please refer to section titled “Outstanding Litigations” appearing on page no. 95 of the Prospectus.

2. The Company is promoted by first generation entrepreneurs and the investors will be subject to allconsequential risk associated with such ventures.

Management Perception:

Mr. Kamlesh L. Jain and Mr. Indermal P. Jain are first generation entrepreneur have around 20 years experiencein the thermoware industry. Further, the Company has also employed a team of professionals with severalyears of relevant experience to look after day to day operations of the Company.

3. The Company has not yet placed orders for the plant and machinery for the proposed expansion


The Company has finalised the list of plant and machinery, including the machineries to be imported. TheCompany have entered into an agreement with Tung Tai Machine Works Company Ltd., Taiwan for purchase ofimported machinery and also obtained quotations for the same. The Company will place the orders for requisitemachineries after receipt of issue proceeds.

4. The proposed expansion project is entirely funded by the Public Issue. There has already been delayin implementation of the project by four months as envisaged by the Company. Any further delay inraising the funds from IPO may have an adverse impact on the future performance of the Company.


Delays in raising funds are likely to have an impact in the growth plans of the company in the short run dueto delayed deployment of funds. Due to delays, it is likely that the Company may have to rely on debt whichwill in turn affect the profitability of the company.

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5. An increase in the prices of raw materials will raise manufacturing costs and could adversely affect theprofitability of the Company. Further the company is dependent on few suppliers for raw material.


Any abrupt or large scale increase in the prices of the raw materials can adversely affect profits of the company,in case it’s unable to pass on them to their customers. The Company is dependent on few suppliers for therequirement of raw material in domestic market. The raw materials are also available from the overseas market.In case of any problem in procurement of raw material from the domestic market, the company has an optionto procure it from overseas.

6. BOB Capital Markets Limited, the appraiser is not having any financial commitment.

The Appraising Agency viz. BOB capital Markets Limited is not having any financial commitment through Debtor Equity. Further they are not the monitoring agency to the utilization of issue proceeds.

7. Non-acceptance of new product, PVC Wood Composite, by Indian Consumers would impact the businessoperations of the Company


Though historically Indian Consumer has a preference for wood products as compared to its substitute product,management believe that PVC wood products would provide the better properties and look alike wood productto the customers. The growing prices of wood products and expected environmental friendly policies in futurewould lead to encouragement of PVC wood composite products over wood products. As a result of which theacceptance of PVC Wood Composite Profiles / Sheets will evolve slowly in India.

8. The business of the Company is dependent on its manufacturing facilities. The loss of or shutdown ofoperations at any of manufacturing facilities may have a material adverse effect on Company’s business,financial condition and results of operations.

The principal manufacturing facilities at Daman are subject to operating risks, such as the breakdown or failureof equipment, power supply or processes, performance below expected levels of output or efficiency,obsolescence, labour disputes, strikes, lock-outs continued inavailability of services of our external contractors,earthquakes and other natural disasters, industrial accidents and the need to comply with the directives ofrelevant government authorities. The occurrence of any of these risks could significantly affect our operatingresults.


With a view to minimise the risk of shutdown of its manufacturing facilities because of various reasons, thecompany plan to carry out a planned shutdowns of its various manufacturing facilities for maintenance ofmachineries and utilities. The Company planned to use updated technology for its products and also try tohave a cordial relationship with their employees.

9. The company face competition for its products from overseas manufacturers, importers and new entrant.Besides, the company may also face competition from products made of improved or advanced materials.


The cost of PVC-wood composite manufactured indigenously would be less than the imported comparableproduct. Management believe that having a brand in the market will help the company in gaining a marketshare in PVC –Wood composite products in India.

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10. The company does not have its own internal sales network and plans to distribute its products throughdealer & distributor network. The Company is therefore exposed to the risk of dealers failing to adhereto the standards set for them in respect of sales which in turn could affect customer’s perception ofbrand and products.


The company has a network of 98 distributors and country wide network of dealers and sub-dealers underdistributors. With a view that the distributors and the dealers promote company’s product and adhere to thestandards set for them in respect of sales, the company provides various incentives and discount to them.Further from last few years the company is dealing with these dealers and distributors and the company hasnot faced any major problem.

11. The Company has taken over the assets and liabilities of Alaska Industries, a partnership firm ofpromoters, by way of business transfer agreement in July, 2005. There are various approvals / licenses/ registrations / consents in the name of Alaska Industries. Any unforeseen liability arising in futuremay adversely affect financial position of the company and / or may give arise to any civil dispute also.The non-approval or non-transfer of any registration / licenses / consents may also adversely affect thebusiness operations.

12. Approval of sanctioned load from Electricity Board is in the name of Thermoplast Industries PrivateLimited.

The name of the Company was changed from Thermoplast Industries Private Limited to Bluplast IndustriesPrivate Limited in March, 2005 and subsequently became public limited company w.e.f. July 14, 2005. TheCompany has received approval for change in name for all its consents / approvals / registrations / licensesexcept for approval of Electricity Board. The company does not forsee any problem in getting the name changed.

13. Dependence on key management team

The company may lose its key management team to competitors. If one or more members of its managementteam are unable or unwilling to continue with the company, it may find it difficult to replace such people and itsbusiness may be adversely affected


The company has a team of professionals who are responsible for the day-to-day operations. Some of thecompany’s senior management team members have been with the company for many years.

14. The Company’s inability to manage growth may lead to loss of opportunities and may hamper its futuregrowth plans.


The Company has experienced growth in total income in recent years. The success of company’s businesswill depend greatly on its ability to effectively implement business and growth strategy. Whilst the companyhas successfully executed its business strategy in the past, there can be no assurance that it will be able toexecute its strategy on time and within the estimated budget. The company expects its growth strategy toplace significant demand on its management and other resources and require to continue developing andimproving its operational, financial and other internal controls. The company’s inability to manage its businessand growth strategy could have a material adverse effect on its business, financial condition and profitability.

15. In the past 12 months, the company has issued equity shares, which may be at issue price being offeredin the issue.

During October - December, 2005 the Company has issued 15,40,742 Equity Shares of Rs. 10/- each for cashat a price of Rs. 25/- to Promoters and Associates. The price at which equity shares have been issued in the

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last 12 months is not indicative of the price which may be offered in this issue. For further details, please referto Section titled “Capital Structure” beginning on page no. 10 of the Prospectus.

16. The Company may continue to be controlled by its Promoters following this Issue and other shareholdersmay not be able to affect the outcome of shareholder voting during such time.

After the completion of the Issue, our Promoters will collectively hold approx. 41.23% of the outstanding EquityShares. Consequently, our Promoters and other principal shareholders, if acting jointly, may exercise substantialcontrol over us and inter alia may have the power to elect and remove a majority of our Directors and/or determinethe outcome of proposals for corporate action requiring approval of our Board of Directors or shareholders,such as lending and investment policies, revenue budgets, capital expenditure, dividend policy and strategicacquisitions / joint ventures.

17. Covenants with lenders may restrict our operations, our capacity to expand, distribute dividends, etc.

There are certain restrictive covenants under terms and condition of the Loan agreement that we have enteredinto with our bankers. Some of these covenants require the prior permission of the said banks for the following:

� Formulate any scheme of amalgamation or reconstruction

� Enter into additional borrowing arrangements either secured or unsecured.

� Implement any scheme of expansion or acquire fixed assets of substantial value.

� Undertake guarantee value on behalf of other firm

� Declare any dividend more than net profit for the year.

� Make any future changes in ownership of the brand “Bluplast”

However, UTI Bank Limited, vide its letter dated November 21, 2005, has given its ‘No Objection Certificate’ tothe Company for its proposed Initial Public Issue.

18. The Company, its Promoters, Group Companies are involved in number of legal proceedings, whichmay have some financial implications on the business of the Company.

The company, its Promoters, Group Companies are involved in a number of legal proceedings, which areclassified under the various legal heads:

Various categories of litigation Total Total Financial implications number of cases (where quantifiable)

(Rs. In lakhs)

Involving Company

Sales Tax / Central Excise Tax / Income Tax 5 40.89

Involving Promoters

Criminal 1 2.23

Excise Matter 2 2.10

Involving Promoter Group Companies

Excise Matter 5 35.88

Refund Claims 1 4.01

Sales Tax 4 2.62

TOTAL 87.73

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These legal proceedings are pending at different levels of adjudication before various courts, tribunals, enquiryofficers and appellate tribunals, should any new development arise, such as a change in Indian law or rulingsagainst the Company, its Promoters and Group Companies by appellate courts or tribunals, it may need toestablish reserves in the financial statements, which could increase their expenses and current liabilitiesFurthermore, if a claim is determined against the Company, Promoters and Group Companies and it is requiredto pay all or a portion of the disputed amount, it could have a material adverse affect on the results of operationsand cash flows of the Company. For further information regarding litigations, please refer section titled“Outstanding Litigations” on page no. 95 of this Prospectus.

19. Some of our Promoter Group Companies are loss-making. Promoters have decided to close / wind upthe operations of their various partnership firms as they being inoperative.

(Rs. In Lakhs)

Particulars PAT / Loss PAT / Loss PAT / Lossfor FY 2003 for FY 2004 for FY 2005

Bluplast Moulders Pvt. Ltd. (0.82) (0.87) (0.30)

Bluplast Corporation 0.06 (0.12) 0.75

Neelam Plastics Industries (1.05) 0.00 0.00

For more details, please refer to the Section “Promoter Group Companies” on page no. 60 of this Prospectus.

20. The Company has following contingent liabilities not provided for in the books of accounts under IndianAccounting Standards, which may adversely affect our financial condition.

(Rs. In Lakhs)

Particulars March 31, 2006

Bank Guarantee 33.05

Capital contracts remaining to be executed 41.17

I.T. demands under appeal 3.04

TOTAL 77.26

In the event such contingent liability materializes it may have an adverse affect on our financial performance.

21. Other Promoter group companies have business interest in the Company.

The group companies have number of financial and business transactions with our company. For the detailsplease refer to section titled “Related Party Transaction” on page no. 65 of this Prospectus.

22. Promoter group entities are in the same line of acitivity that may lead to conflict of interest betweenthose entities.

The Company has seven group entities and out of seven, six are partnership firms and are largely inoperative.The Company has now decided to take steps to close these firms to avoid any conflict in future.

23. The company has yet to receive registration certificate for registration of “Hello Genie” trademark, whichit is using for business promotion strategy.

The company has applied for registration of the said trademark in May, 2005 and received temporary applicationnumber for usage of the trademark. However, company is yet to receive final certificate in this regard.

viii


24. We require certain registrations and licenses from government and regulatory authorities and the failureto obtain them in a timely manner or at all may adversely affect the operations of our Company.

In respect of proposed manufacturing facilities at Daman, the company have obtained necessary approvalsand consents for undertaking business activities. For more information, see “Government Approvals” on pageno. 100 of this Prospectus. We will apply for any further approval / registration / consent which may be requiredin future to commence the commercial production. If we fail to obtain approval of any of registrations and licenses/consents in a timely manner, or at all, the business of our Company may be adversely affected and its directorsand officers may be subjected to civil or criminal proceedings.

25. Weaknesses and Threats as per the appraising agency

Weakness

� The Company is yet to gain expertise in marketing of PVC Wood Composite Profiles / Sheets

� Although the company has experience in production of plastic products, the company does not haveexpertise in manufacturing of PVC Wood Composite products.

� The Company is yet to place orders for machinery and any delay in implementation schedule of the projectwould lead to time and cost overrun.

Threats

� Large presence of the unorganized sector selling low priced products which compete with the productsmanufactured by the organised sector.

� Large number of plastic products are reserved for SSI sector.

� The increase in oil prices are likely to increase raw material prices which will affect the profitability ofplayers making plastic products.

� The Indian consumer has a preference for wood products as a result of which the acceptability of PVCwood composite profiles / sheets will evolve slowly in India.

� PVC Wood composite are new products that have been recently introduced even in developed countriesso industry standards are yet to be evolved for these products. The claims made by producers even indeveloped countries are yet to be tested.

� Research on various types of plastic composite products is being carried out in India as well as developedcountries in the world. Introduction of any new composite product in the market other than Wood-PVCcomposite can affect the marketability of the products introduced by the company.

� Any change in government regulations or policies can affect the operations of the company.

� The company can face competition if PVC wood products are imported or foreign companies startmanufacturing operations for PVC wood products in India.

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B. EXTERNAL RISK FACTORS

1. Exchange Rate Fluctuations may have impact on the performance of the Company.

The Company is exposed to exchange rate fluctuations. Uncertainties in the global financial market may havean adverse impact on the exchange rate between Rupee vis-à-vis other currencies. The exchange rate betweenthe Rupee and other currencies is variable and may continue to fluctuate in the future. Such fluctuations canhave a serious impact on the cost of the Company.

2. Political situation and changes in the Government of India may affect the performance of the Company.

The Government of India has pursued the economic liberalization policies including relaxing restrictions on theprivate sector over the past several years. The present Government has also announced polices and takeninitiatives that support continued economic liberalization. There is no assurance that the liberalization policiesof the government will continue in the future. Protests against privatization could slow down the pace ofliberalization and deregulation. A significant change in India’s economic liberalization and deregulation policiescould disrupt the business and economic conditions in India.

3. Natural disasters could disrupt our operations and result in loss of revenues and increased costs.

The business of the Company is exposed to man-made and natural disasters such as, explosions, earthquakes,storms and floods as well as to terrorist attacks or other enemy actions. The occurrence of a man-made ornatural disaster, terrorist attack, enemy action or other accidents could disrupt the operations of the businessof the Company and result in loss of revenues and increased costs.

4. The acts of violence and terrorist attacks or war involving India could adversely affect the Company’sbusiness.

There have been instances of terrorist attacks in many parts of the world and also in India in the recent past.Any recurrence of such events or other acts of violence/war may negatively affect the Indian capital marketand may also adversely affect performance of our scrip in the stock exchanges. These acts may also result ina loss of business confidence. Any recurrence of events of terrorist attacks or other acts of violence mayadversely impact the desire of corporate executives to travel to India for business purposes and thereby adverselyimpacting business prospects. These uncertainties make it difficult for us and our customers to accuratelyplan future business activities.

5. Taxes and other levies imposed by the Government of India or other State Governments, as well asother financial policies and regulations, may have a material adverse effect on our business, financialcondition and results of operations.

Taxes and other levies imposed by the Central or State Governments in India that affect our industry includecustoms duties, excise duties, sales tax, income tax and other taxes, duties or surcharges introduced on apermanent or temporary basis from time to time. Currently we benefit from certain tax benefits that results ina decrease in the effective tax rate compared to the tax rates that we estimate would have applied if theseincentives had not been available. There can be no assurance that these tax incentives will continue in thefuture. The non-availability of these tax incentives could adversely affect our financial condition and results ofoperations.

6. After this Issue, the price of the Equity Shares may be highly volatile or there may be no active marketfor the Equity Shares which may be due to various reasons including the following:

� Volatility in the Indian and Global securities market;

� The results of operations and performance;

� Perceptions about our future performance or the performance of Indian Plywood Industry.

� Performance of the Indian Economy.

x


Notes to Risk Factors:

� Public Issue of 1,10,00,000 Equity Shares of Rs. 10/- each for Cash at a Price of Rs. 32/- per Equity Shareaggregating to Rs. 3520 Lakhs.

� The net worth of our Company before the Issue (as on March 31, 2006) was Rs. 1295.90 Lakhs.

� The average cost of acquisition of one Equity Share for the Promoters is Rs. 12.09 per Equity Share of andthe book value as on March 31, 2006 is Rs. 16.79 per Equity Share.

� For related party transactions, refer to the section titled ‘Related Party Transactions’ and ‘Transactions withPromoter/ Promoter Group’ on page 65 of this Prospectus.

� No loans and advances have been made to any person(s) / companies in which the Director(s) of the Companyare interested except as disclosed in “Related Party Transactions”.

� The Investors are advised to refer to the section titled ‘Basis for Issue Price’ on page 30 of this Prospectusbefore making an investment in this Issue.

� None of the other ventures of the promoters have a business interest/ other interests in the Issuer Companyexcept as disclosed in the “Related Party Transactions” and “Transactions with Promoter/ Promoter Group” onpage 65 of this Prospectus.

� Trading in Equity Shares of our Company for all the investors shall be in dematerialized form only.

� Investors may note that in case of over-subscription in the Issue, allotment shall be on a proportionate basiswithin the specified categories. For more information, see the section titled ‘Basis of Allotment’ at page 115 ofthis Prospectus.

� The Registered office of the Company was changed from 108, Udyog Bhavan, Sharma Industrial Estate,Goregaon(East), Mumba-400 063 to Gala No. 113 & 114, Vivek Industrial Estate, P-Plt, Walbhat Road, CamaEstate, Goregaon (East), Mumbai-400 063 with effect from April 1, 2001.

� The name of Company was changed from Thermoplast Industries Private Limited to Bluplast Industries PrivateLimited w.e.f. March 11, 2005 and subsequently converted into a Public Limited Company on July 14, 2005.

� The Investors may contact the LM to the Issue or the Compliance Officer for any complaints, information orclarifications pertaining to the Issue.

� No part of the issue proceed will be paid as consideration to promoters, directors, key managerial personnels,associate or Group Companies.

Investors may contact the LM for any complaints, information or clarifications pertaining to the Issue.

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SECTION III

INTRODUCTION

Summary

The following summary is qualified in its entirety by the more detailed information and the financial statements of the Companythat appear in this Prospectus. Unless otherwise stated, all financial and other data regarding our business and operationspresented in this Prospectus are presented on a consolidated basis.

Industry Overview

Overview of Indian Sector

The Plastic Sector is a growing industry in India. The demand for most plastic products in India has increased at double-digitgrowth rate during the last decade. The consumption of plastic products in India tends to increase significantly in the yearswhen there is significant increase in polymer availability. Notably, beyond 1999, when there was abundant availability of rawpolymer resin domestically, the plastic industry year-on-year growth rate correlated well with the corresponding GDP growthrate. Overall, the key demand determinants for plastics in a country are per capita income, availability of plastics, culturalfactors, and the level of environmental concerns.

Consumption of plastics in India is modest compared to developed countries. Although per capita consumption of plastics inIndia has risen from 0.96 kg in 1995-96 to about 4.1 kg in 2004-05, it is still way below the world average of 20 kg. One ofthe reasons for this is that an overwhelming share of the consumption (over 80%) is accounted for by commodity plasticswhich are mainly used in the making of low-value household articles, pipes, moulded extruded sheets etc. The per capitaplastics consumption, which is currently at 4.1 kg, is projected to go up to 8 kg by the year 2007. On the basis of the largeIndian population and growth rate of Indian GDP, by the year 2010 India is projected to become the world’s third largestconsumer of plastics after US and China from its current eighth position.

(Source: ICRA Industry Report, June 2005)

STRUCTURE OF THE INDUSTRY

On the basis of value added, the plastic products sector contributes to around 0.5% of GDP of the country. The plastic productssector also provides for 1% of the country’s export. An estimated 0.4 million people are employed in the sector. There is apresence of the small scale companies in the industry which account for more than 50% of the industry turnover. The Indianplastic processing Industry is highly fragmented and comprises 25000 firms with more than 400000 employees. Barring 10-15% of the firms, which can be classified as medium-scale operations, all the other units operate on a small scale basis. Thetop 100 players accounts for just 20% of the industry turnover. The total number of players in the sector is more than 25000.However, the degree of fragmentation, worldwide, is large and despite the small size of operations they are able to operateprofitably. Further the high growth in demand ensures that the market is able to absorb the excess capacity in quick times.Overall, the degree of competition can be considered high in the Indian Plastic processing industry.


Business Overview

The promoters of the Company Mr. Kamlesh L. Jain and Mr. Indermal P. Jain have been associated with the plastic industryfor more than two decades. The promoter had started business activity in plastic product manufacturing by incorporatingBluplast Corporation in 1985. Subsequently, promoters expanded business by setting up a facility in the same line in Damanunder Alaska Industries, a group company. Later, the Promoters incorporated Thermoplast Industries Private Limited in 1999with additional unit in Daman. The manufacturing plant of the Company was set up at Daman (in Union Territory of Damanand Diu) with an initial capacity of 1940 MTPA, which has, over a period of time, been increased up to 4500 MTPA.Thermoplast Industries Private Limited later renamed as Bluplast Industries Private Limited. The Company has acquiredtotal manufacturing unit of Alaska Industries on July 1, 2005 and became a Public Limited Company, viz. Bluplast IndustriesLimited, with effect from July 14, 2005. The Company has been operating at 100% capacity utilization for the past threeyears. In the FY 2004-05, to meet the demands of its products, the Company had to outsource the work of manufacturing itsproducts to sub-contractors on job work basis and as a result of which the Company manufactured 5465 MTPA against aninstalled capacity of 4500 MTPA.

2


In July 2005, the Company acquired the business of Alaska Industries, a group concern., Pursuant to this acquisition, theCompany’s manufacturing capacity increased from 4500 MTPA to 5400 MTPA. Further, during last FY 2005-06, the Companyachieved 8379 MTPA against installed capacity of 5400 MTPA.

The Company manufactures plastic articles adopting the ‘Injection Moulding’ method and its product range includesThermoware, Vacuumware, Insulatedware, Kitchenware, Utilities and pet products (e.g. Casserole with the capacity of 500ml-12500ml, Lunch Packs 3-5 containers, Flasks with the capacity of 750 ml –1500 ml, water jugs with the capacity of 2000 ml-2500 ml, Water Bottles with the capacity of 500 ml – 2500 ml, Pet Jars with the capacity of 800 ml – 2500 ml, Buckets, BathStools, Bath Tubs, Baskets, Dust Bins etc.).

Our Vision

To be one of the household utility product and PVC wood composite manufacturer by offering range of products to thesatisfaction of customers at an affordable price.

Business Strategy

Our principal Operating strategies are

� To increase market share in the plastic utility household product range in Domestic Market and also increase theshare in international market.

a. The company is increasing its installed capacity in its existing product range from 5400 MTPA to 9000 MTPA.

b. Broad base its product range to cater to various consumers so that the contribution of any particular consumersegment does not account for a large portion of the company’s sales.

� To be one of the major players in PVC Wood composite products by :

(i) Introducing high value added products such as PVC - Wood composite profile / sheets.

(ii) Market potential for export of PVC Wood Composite products to be explored.

3


SUMMARY OF FINANCIAL / OPERATING DATA

STATEMENT OF ADJUSTED ASSETS AND LIABILITIES (As Restated)

Rs. In Lakhs

Particulars As at As at As at As at As at31.03.2006 31.03.2005 31.3.2004 31.3.2003 31.3.2002

A. Fixed Assets:

Gross Block 929.95 672.04 591.53 552.51 520.30

Less : Depreciation 404.29 325.70 262.82 202.39 137.60

Net Block 525.67 346.34 328.71 350.12 382.70

Capital Work in Progress 7.39 2.30 0.65 0.25 -

Total 533.05 348.64 329.36 350.37 382.70

B. Investments - - - - -

C. Current Assets, Loans & Advances

Inventories 775.54 707.14 470.93 330.48 235.06

Sundry Debtors 1,516.49 837.83 464.27 460.18 217.93

Cash and Bank Balances 89.08 71.82 57.56 54.57 33.71

Loans and Advances 292.55 233.95 144.50 106.05 58.44

Total 2,673.65 1,850.73 1,137.26 951.27 545.14

D. Liabilities& Provisions

Share Application Money received - 65.00 - - -

pending for allotmentSecured Loans 1,018.96 800.37 502.75 587.25 427.46

Unsecured Loans 179.98 118.15 55.82 72.93 51.28

Current Liabilities and Provisions 709.77 466.14 436.94 279.94 194.42

Deferred Tax Provisions 2.10 9.00 8.28 7.97 -

Total 1,910.81 1,458.65 1,003.80 948.09 673.16

E. Networth (A+B+C-D) 1,295.90 740.71 462.83 353.56 254.69

F. Represented by

Share Capital 771.62 487.30 173.53 173.53 173.53

Reserves and Surplus 581.47 254.91 291.09 182.11 83.54

Less: Miscellaneous Expenses not 57.20 1.49 1.79 2.09 2.39

written off/ adjusted

Net Worth 1,295.90 740.71 462.83 353.56 254.69

Note: With effect from July 01, 2005, the Company has takenover the manufacturing unit of Alaska Industries a partnershipfirm on a slump sale basis. Hence the figures for March ’06 include the assets and liabilites of the said unit of Alaska Industries.)

4


STATEMENT OF ADJUSTED PORFIT AND LOSSES ACCOUNT (As Restated)

Rs. In Lakhs

Particulars Year Ended Year Ended Year Ended Year Ended Year Ended31.03.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002

INCOME

Operating Income 6337.98 4194.57 3882.83 3397.26 2296.52

Other Income 2.10 1.87 2.03 2.74 3.81

Increase (Decrease) in Stocks 63.99 143.35 93.39 58.85 45.88

Total 6404.06 4,339.79 3,978.25 3,458.85 2,346.21

EXPENDITURE

Raw Material Consumed 5263.55 3,514.92 3,170.86 2,720.56 1,845.87

Staff Costs 125.02 32.98 27.48 24.66 29.65

Other Manufacturing Expenses 346.32 310.31 371.29 348.46 211.89

Administrative, Selling and Other Expenses 230.74 148.92 140.72 97.00 65.06

Total 5,965.63 4,007.13 3,710.34 3,190.68 2,152.48

Profit Before Interest, Depreciation and Tax 438.43 332.66 267.91 268.16 193.73

Interest & Financial Charges 129.87 95.88 70.48 76.23 70.53

Depreciation 78.59 62.88 60.43 64.79 70.83

Net Profit before tax 229.97 173.90 137.00 127.14 52.37

Taxation

Current tax 64.00 14.60 11.10 12.50 4.00

Fringe Benefit Tax 5.67 - - - -

Deferred tax (6.90) 0.71 0.31 0.85 -

Net Profit after tax 167.20 158.59 125.59 113.79 48.37

Income Tax adjustment - - 0.06 (1.20) 0.49

Net Profit after tax adjustments 167.20 158.59 125.53 114.99 47.89

Dividend on Shares 63.76 18.68 13.01 8.68 7.12

Tax on Dividend 8.94 2.62 1.70 1.11 -

Net Profit 94.50 137.30 110.82 105.20 40.77


5


THE ISSUE

PARTICULARS NO. OF EQUITY SHARES

Present Issue 1,10,00,000 Equity Shares

Offer through this Prospectus 1,10,00,000 Equity Shares of Rs. 10/- each at a premium ofRs. 22/- per Equity Shares

OUT OF WHICH:

Reserved for Employee* 10,00,000 Equity Shares of Rs 10/- each

Net Offer to the Public 1,00,00,000 Equity Shares of Rs 10/- each

Equity Shares outstanding prior to the Issue 77,16,242 Equity Shares of Rs 10/- each

Equity Shares outstanding after the Issue 1,87,16,242 Equity Shares of Rs 10/- each

Use of Proceeds We intend to use the net proceeds of the Issue after meeting Issuerelated expenses.Please see the section entitled “Objects of theIssue” on page 19 of this Prospectus.

*There are 158 permanent employee on the rolls of the company as on March 31, 2006.

Note: Undersubscription, if any, in the net offer to the public category shall be allowed to be met with spill over from thereserved category to the net issue to the public at the sole discretion of the Company in consultation with the Lead Managers.

6


GENERAL INFORMATION

Bluplast Industries Ltd.Registered Office: 113/114, Vivek Industrial Estate, Uswala Road, Near Litolier,

Cama Estate, Goregaon (East), Mumbai – 400 063. Tel No: 022-26851212, Fax No: 022- 26851151

Company Registration No. 011-117874

The Company is registered at the Registrar of Companies, Maharashtra, 100, Everest, Marine Lines, Mumbai - 400002

Board of Directors comprise of the following members:

Sr. No. Name Designation

1 Mr. Kamlesh L. Jain Managing Director

2 Mr. Indermal P. Jain Whole - Time Director

3 Mr. Prince Jain Director

4 Mr. Rajendra Jain Director

5 Mr. Janakraj Vakil Director

6 Mr. Arvind M. Mehta Director

Details of the Chairman and Managing Director / Whole time Director

Mr. Kamlesh Jain, Chairman and Managing Director:

Mr. Kamlesh Jain, aged 46 years, is the Managing Director of the Company. He has about 20 years of experience in PlasticThermoware Industry. In the year 1978 he joined the Cello Group and gained experience in household plastic items. In theyear 1985 he set up his own plastic household thermoware facilities under the firm name Bluplast Corporation. He has beenassociated with the Company since inception and has been taking part in all the activities of the Company. He supervisedthe launching of new products introduced by the company from time to time.

Mr. Indermal P. Jain, Whole – Time Director:

Mr. Indermal Jain is younger brother of Shri Kamlesh Jain aged 43 years. He is a whole time director of the Companydesignated as Joint Managing Director. He joined Bluplast Corporation as a partner and gained experience in plastic items.He was also one of the promoter of Thermoplast Industries Pvt. Ltd which is currently known as Bluplast Industries Limited.He is involved in looking after the designing concepts of the plastic products for the Company.

COMPLIANCE OFFICER

Mr. Shashinand NagoriBluplast Industries Ltd.113/114, Vivek Industrial EstateUswala Road, Near LitolierCama Estate, Goregaon (East)Mumbai – 400 063Tel : 022- 26851631, 26852816Fax : 022- 26851151E-mail: [email protected]

7


COMPANY SECRETARY

Mr. Satish SrivastavaBluplast Industries Ltd.113/114, Vivek Industrial EstateUswala Road, Near LitolierCama Estate, Goregaon (East)Mumbai – 400 063Tel : 022- 26851631, 26852816Fax : 022- 26851151E-mail: [email protected]

Investors can contact the Compliance Officer in case of any pre-Issue or post-Issue related problems such as non-receipt of letters of allotment, credit of allotted shares in the respective beneficiary account, refund orders etc.

LEGAL ADVISER TO THE ISSUE

Rajani AssociatesF – 4, Panchsheel,53, ‘C’ Road, ChurchgateMumbai – 400 020.Tel : 022-2202 1010Fax : 022-2202 1011E-mail: [email protected]

BANKERS TO THE COMPANY

UTI Bank Ltd.,Royal Accord IVLokhandwala ComplexAndheri (West)Mumbai – 400 053.Tel: 022 – 26352646Fax: 022 – 26328008Email: [email protected]: www.utibank.com

LEAD MANAGERS

Allianz Securities Limited33, 6th Floor, Vaswani MansionDinsha Vachha RoadChurchgate, Mumbai - 400020Tel: 022-22870580Fax: 022-22870581Website: www.aslfinancial.comEmail: [email protected] Person: Ms. Kavitha

REGISTRARS TO THE ISSUE

Bigshare Services Private Ltd.E – 2/3, Ansa Industrial EstateSakivihar Road, Saki Naka, Andheri (E)Mumbai – 400 072.Email: [email protected]: www.bigshareonline.comContact Person: Mr. V. Kumaresan

8


BANKERS TO THE ISSUE

Corporation BankVeena Chambers, Dalal StreetFort, Mumbai – 400 021Tel : 022-22651744Fax : 022-22851715Email : [email protected] Person : Mr. U. Sripathi

ICICI Bank Ltd.,Capital Markets Division,36, Mumbai Samachar MargFort, Mumbai – 400 001.Tel: 022 – 22655285Fax: 022 - 22611138Email: [email protected] Person: Mr. Sidhartha RoutrayWebsite: www.icicibank.com

UTI Bank Ltd.,Royal Accord IVLokhandwala ComplexAndheri (West)Mumbai – 400 053.Tel: 022 – 26352646Fax: 022 – 26328008Contact person – Mr. Sunil GurbaxaniEmail ID: [email protected]: www.utibank.com

Standard Chartered Bank90, Mahatama Gandhi RoadFort, Mumbai – 400 001Tel : 022-22683965 / 22092213Fax : 022-22096069Email: [email protected] Person : Banhid BhattacharyaWebsite : www.standardchartered.co.in

AUDITORS TO THE COMPANY

Singrodia Goyal & Co.Chartered Accountants201, Rajeshri AccordTelly Cross LaneOff. S. N. Road, Andheri (E)Mumbai 400069Tel: 022- 2683 6363Fax: 022- 2682 6464Website: www.singrodiagoyal.comE-mail: [email protected]

9


Credit Rating

As the Issue is of Equity Shares, credit rating is not required.

Grading of Issue

The Issue is not graded by any Credit Rating Agency.

Trustees

As the Issue is of Equity Shares, the appointment of Trustees is not required.

Monitoring Agency

Corporation Bank has been appointed as the monitoring agency to monitor the utilisation of issue proceeds.

Appraising Entity

BOB Capital Markets Limited,Noble Chambers (Vatsa House),20-C/D S. A.Brelvi Road, Fort,Mumbai – 400 001.Tel: 022 – 2284 4892 / 93Fax: 022 - 22845208Email: [email protected]: www.bobcapitalmarkets.com

10


CAPITAL STRUCTURE OF THE COMPANY

Aggregate Nominal Aggregate valueValue at Issue Price

(in Rs. In Lakhs) (in Rs. In Lakhs)

(A) Authorized Share Capital

2,00,00,000 Equity shares of Rs.10/- each 2,0,00.00

(B) Issued, Subscribed and Paid-up Equity Capital

77,16,242 Equity shares of Rs.10/- each fully paid up 771.62

(C) Present Issue in terms of this Prospectus

1,10,00,000 Equity shares of Rs.10/- each at a price of 1,100.00 3520.00Rs. 32/- per equity share for cash.

(D) Employee Reservation Portion

10,00,000 Equity shares of Rs. 10/- each at a price of 100.00 320.00Rs. 32/- per equity share for cash.

(E) Net Offer to the Public

1,00,00,000 Equity shares of Rs. 10/- each at a price of 1,000.00 3200.00Rs. 32/- per equity share for cash.

(F) Paid – up Capital after the issue

1,87,16,242 Equity shares of Rs. 10/- each 1,871.62

(G) Share Premium Account

Before the Issue 231.11

After the Issue 2651.11

Details of Increase in Authorised Capital

Date Authorised Capital (Rs.) Face Value (Rs.) No. of Shares Particulars

14.01.1999 25,00,000 10/- 2,50,000 Incorporation

04.10.1999 1,75,00,000 10/ 17,50,000 Increase

07.02.2005 5,00,00,000 10/- 50,00,000 Increase

25.07.2005 10,00,00,000 10/- 1,00,00,000 Increase

12.09.2005 20,00,00,000 10/- 2,00,00,000 Increase

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NOTES FORMING PART OF THE CAPITAL STRUCTURE:

1. Equity Share Capital History of the Company

Date of No. of Face Value Cumulative Issue Price Conside- Nature of Securitiesallotment shares allotted (Rs.) no. (Rs.) ration Allotment Premium

of shares Account (Rs.)

15.01.1999 310 10 310 10 Cash Subscription to NilMemorandum

27.10.1999 600,000 10 600310 10 Cash Preferential Allotment Nilto Promoters

10.03.2001 7,70,000 10 13,70,310 10 Cash Preferential Allotment Nilto Promoters andAssociates

05.02.2002 3,65,000 10 17,35,310 17 Cash Preferential Allotment 25,55,000to the associates ofPromoters

08.03.2005 17,35,310 10 34,70,620 10 Bonus Bonus in the ratio Nilof 1:1

25.03.2005 13,87,690 10 48,58,310 10 Cash Preferential Allotment Nilto the associatesof Promoters

31.03.2005 14,690 10 48,73,000 10 Cash Preferential Allotment Nilto Promoter

25.07.2005 13,02,500 10 61,75,500 10 Cash Preferential Allotment Nilto Promoters andAssociates

29.10.2005 7,47,250 10 69,22,750 25* Cash Preferential allotment 1,12,08,750to promoter

31.10.2005 5,95,992 10 75,18,742 25 Cash Preferential Allotment 89,39,880to Promoters andAssociates

28.12.2005 1,97,500 10 77,16,242 25 Cash Preferential Allotment 29,62,500to Promoters andAssociates

Note *: Initially the company has allotted shares @ Rs 20/- per share including premium of Rs 10/- per share. However asper resolution passed at Meeting of Board of Directors held on December 28th 2005 the premium amount was increased toRs 15/- per share (Paid Up Rs 25/- per share). Revised Return of Allotment was also submitted with the ROC.

12


2. Promoters’ Contribution & Lock in

Date of Date when Nature of Consid- No. of Face Issue/ Lock-inacquisition fully paid up transaction eration shares value transfer Price period***

Mr. Indermal P. Jain

15.01.1999 15.01.1999 Subscription to Cash 100 10 10 3 YearMemorandum

27.10.1999 27.01.1999 Allotment Cash 3,00,000 10 10 3 Year


08.03.2005 08.03.2005 Allotment Bonus 5,76,400 10 - 3 Year


25.07.2005 N.A. Transfer Cash 3,68800 10 17 3 Year





31.10.2005 31.10.2005 Allotment Cash 56,660* 10 25 3 Year


Total 29,63,920

Mr. Kamlesh L. Jain

27.02.1999 N.A. Transfer Cash 10 10 10 3 Year



08.03.2005 08.03.2005 Allotment Bonus 5,86,310 10 - 3 Year


31.03.2005 31.03.2005 Allotment Cash 14,690 10 10 1 Year

25.07.2005 N.A. Transfer Cash 3,68,800 10 17 3 Year






Total 33,91,324

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Date of Date when Nature of Consid- No. of Face Issue/ Lock-inacquisition fully paid up transaction eration shares value transfer Price period***

Mrs. Rekha Kamlesh Jain

15.01.1999 15.01.1999 Subscription toMemorandum Cash 100 10 10 3 Year

08.03.2005 08.03.2005 Allotment Bonus 100 10 - 3 Year


25.07.2005 N.A. Transfer Cash 64 10 10 3 Year




Total 5, 58,182

Mrs. Nayana Indermal Jain

15.01.1999 15.01.1999 Subscription toMemorandum Cash 62** 10 10 3 Year

08.03.2005 08.03.2005 Allotment Bonus 62 10 - 3 Year


25.07.2005 25.07.2005 Allotment Cash 10,000 10 10 1 Year



Total 4,88,112

Grand Total 74,01,538

*These shares totalling to 2,54,160 have been considered under minimum promoters contibution and are also consideredas eligible for Lock in period of 3 years. The company has received an undertaking from the respective Promoters wherebythey have confirmed that they will bring in the difference of the Issue Price and Rs 25/- atleast one day before opening of theIssue, in order to comply with the SEBI Guidelines in respect of minimum Promoter Contribution and lock-in requirement.

** On 15.04.2003 and 24.09.2004, out of the 100 shares subscribed to Memorandum by Mrs. Nayana Indermal Jain, 38shares were transferred to other associates of the Promoters.

***Lock-in period will commence from the date of allotment in this issue.

The promoters viz. Mr. Indermal Jain, Mr. Kamlesh Jain, Mrs, Rekha Jain and Mrs Nayana Jain have given their consent forlock in vide their letter dated January 16, 2006. The shares acquired last have been locked in first and the lock in periodshall commence from the date of allotment of shares in the Public Issue.

14


3. Summary of Lock-in of Promoters holding :

Pursuant to SEBI Guidelines, an aggregate of 20% of the shareholding of Promoters shall be locked in for a periodof three years from the date of allotment in the Issue. In addition, the entire pre-issue capital shall be locked in fora period of one year from the date of allotment in the Issue. The details of which are as under:

Particulars Shares under Lock-in for Total shares

1 year 3 year held

PROMOTER No. of Percentage No. of PercentageShares (Post Issue) Shares (Post Issue)

Mr. Indermal P. Jain 13,56,420 7.25 16,07,500 8.59 29,63,920

Mr. Kamlesh L. Jain 18,19,664 9.72 15,71,660 8.40 33,91,324

Mrs. Rekha Kamlesh Jain 2,76,068 1.48 2,82,114 1.51 5,58,182

Mrs. Nayana Indermal Jain 2,06,138 1.10 2,81,974 1.51 4,88,112

Promoter Group

Bluplast Moulders Private Limited 48,700 0.26 - - 48,700

Others 2,66,004 1.42 - - 2,66,004

Grand Total 39,72,994 21.23 37,43,248 20.00 77,16,242

4. Locked-in Equity Shares held by the Promoters can be pledged with banks or financial institutions as collateralsecurity for loans granted by such banks or financial institution. The equity shares to be held by the promotersunder lock-in period shall not be sold/ hypothecated/ transferred during the lock-in period. However, in terms ofClause 4.16(b) of the SEBI Guidelines, the Equity Shares may be transferred among the Promoters/ Promoter groupor to a new promoter or persons in control of the Company, subject to continuation of lock-in in the hands of thetransferees for the remaining period and compliance of SEBI (Substantial Acquisition of Shares and Takeovers)Regulations, 1997 as applicable. The Equity Shares held by the persons other than the Promoters may be transferredto any other person holding shares prior to the issue, subject to the continuation of the lock-in with transferees forthe remaining period and compliance with the SEBI (Substantial Acquisition of Shares and Takeover) Regulations,1997, as applicable.

The securities which are subject to lock-in shall carry inscription ‘non-transferable’ along with duration of specifiednon-transferable period mentioned in the face of security certificate.

15


5. The following equity shares have been sold / acquired by our promoters, during the period of 6 month precedingthe date on which the prospectus is filed with SEBI.

Transferor Transferee Date on which No. of Par Value Nature of Purchase /equity shares equity (Rs.) Payment Sale pricepurchased or shares (In Rs.)sold

Kamlesh L. Jain Kamlesh L. Jain 25.07.2005 3,68,800/- 10/- Cash 36,88,000/-A/c Alaska Industries Indermal P. Jain 3,68,800/- 36,88,000/-

Kamlesh L. Jain Nayana I. Jain 25.07.2005 2,03,600/- 10/- Cash 20,36,000/-A/c Bluplast Rekha K.Jain 2,03,600/- 20,36,000/-Corporation

Kamlesh L. Jain Kamlesh L. Jain 25.07.2005 9,240/- 10/- Cash 92,400/-A/c Bluplast Utility Indermal P. Jain 9,240/- 92,400/-Products

Mr. Ashok Bajaj Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-

Mr. Daulatram Sada Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Rangani

Mr. Anjoo A. Bajaj Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-

Mrs. Bharati R.Rangani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-

Mr. Rajkumar Bajaj Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Dipesh Malhotra Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr .Ranjit Sahani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. DilpreetshinghAnand (HUF) Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Ashok Bajaj Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Flavia J. D’souza Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Gayatri S. Narwani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Ghanshyam Malhotra Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. H.K. Butaney Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Issardas K. Motwani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. K.M. Murthy Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Kavita R. Bajaj Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Kiran C. Panjwani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Lalchand M. Bhambani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Maya L. Bhambani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. MayasunderShivdasani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Mildred Fernandes Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Murli R. Mukhi HUF Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Neeta Sunil Bajaj Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Shyam Raheja Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Pinky C. Panjwani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Rajkumar Bajaj Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Ram A. Rajani HUF Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Ramchandra Aishwani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mr. Sajan D. Narwani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Sheeladevi G. Bhatija Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Shilpa Vishal Chablani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-Mrs. Sonia M. Peswani Mrs. Rekha K. Jain 25.07.2005 2 10/- Cash 20/-

TOTAL 11,63,344

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6. The Company have not issued any shares for consideration other than cash except for issue of 17,35,310 bonusshares issued on March 8, 2005 which is approved on February 8, 2005 in the ratio of 1:1 by capitalization ofreserves of the Company.

7. The Promoters Contribution brought-in by the promoters was more than the specified minimum lot as defined underSEBI Guidelines.

8. There is no “Buyback” or “Standby” or similar arrangement for the purchase of Equity Shares by the Company/ itsPromoters/ Directors/LMs for purchase of Equity Shares offered through the Prospectus.

9. The Company has not raised any bridge loans against the proceeds of this Issue.

10. Investors may note that in case of over-subscription, allotment will be on proportionate basis as detailed in para on“Basis of Allotment” on page no. 115 of this Prospectus.

11. An over subscription to the extent of 10% of the net offer to public can be retained for the purpose of rounding offto the nearest multiple while finalising the allotment.

12. There are no partly paid up Equity Shares as on the date of Prospectus.

13. The Equity Shares offered through this Issue will be made fully paid up.

14. An applicant in the Net Offer to the Public category cannot make an application for a number of equity shares,which exceeds the net offer to the public.

15. Details of Ten Major Shareholders of the Company

a) As on the date of filing the Prospectus with SEBI

Sr. no. Name of Shareholders No. of Equity shares held % age of holding

1. Kamlesh L. Jain 33,91,324 43.952. Indermal P. Jain 29,63,920 38.413. Rekha K. Jain 5,58,182 7.234. Nayana I. Jain 4,88,112 6.335. Madhu M. Shah 54,000 0.706. Bluplast Moulders Pvt. Ltd. 48,700 0.637. Sunita Rajgarhia & Paras Rajgarhia 40,000 0.528. Mahendra Kumar Mulchand Shah (HUF) 27,000 0.359. Surekha Vilas Oswal 16,000 0.2110. Sanjay Rathi 12,000 0.16

Total 75,99,238 98.48

b) Ten days prior to filing Prospectus with SEBI


1. Kamlesh L. Jain 33,91,324 43.952. Indermal P. Jain 29,63,920 38.413. Rekha K. Jain 5,58,182 7.234. Nayana I. Jain 4,88,112 6.335. Madhu M. Shah 54,000 0.706. Bluplast Moulders Pvt. Ltd. 48,700 0.63 7. Sunita Rajgarhia & Paras Rajgarhia 40,000 0.52 8. Mahendra Kumar Mulchand Shah (HUF) 27,000 0.35 9. Surekha Vilas Oswal 16,000 0.21 10. Sanjay Rathi 12,000 0.16

Total 75,99,238 98.48

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c) Two years prior to filing the Prospectus with SEBI


1. Kamlesh L. Jain 586310 33.782. Indermal P. Jain 576400 33.223. Rekha K. Jain 100 Negligible4. Nayana I. Jain 94 Negligible5. Kamlesh L. Jain A/c Alaska Industries 368800 21.256. Kamlesh L. Jain A/c Bluplast Corporation 203600 11.737. Mr. Pankaj Kumar Gaggar 1 Negligible8. Mr. Narendra B. Jain 1 Negligible9. Mr. Mahendra kumar H. Jain 1 Negligible10. Mrs. Sangeeta N. Jain 1 Negligible

Total 1,735,308 100

16. The Promoters and Promoter Group hold the following Equity Shares of face value of Rs. 10/- each as on datewhich constitutes 96.55% of the aggregate Equity Share Capital of the Company, the details of which are as under:

Particulars No. of Equity Shares % of pre-issue paid up Equity Shares

PromotersKamlesh L. Jain 33,91,324 43.95Indermal P. Jain 29,63,920 38.41Rekha Kamlesh Jain 5,58,182 7.23Nayana Indermal Jain 4,88,112 6.33Promoter GroupBluplast Moulders Pvt. Co. Ltd. 48,700 0.63

Total 74,50,238 96.55

17. Pre-issue and Post-issue Shareholding pattern

Category Pre Issue Post Issue

No. of % No. of %Equity Shares Equity Shares

PromotersKamlesh L. Jain 33,91,324 43.95 33,91,324 18.12Indermal P. Jain 29,63,920 38.41 29,63,920 15.84Rekha Kamlesh Jain 5,58,182 7.23 5,58,182 2.98Nayana Indermal Jain 4,88,112 6.33 4,88,112 2.61Sub-Total (A) 74,01,538 95.92 74,01,538 39.55Promoter GroupBluplast Moulders Pvt. Limited 48,700 0.63 48,700 0.26Sub-Total (B) 48,700 0.63 48,700 0.26Others 2,66,004 3.45 266004 1.42Sub-Total (C) 2,66,004 3.45 2,66,004 1.42Total pre issue share capital{(D)=(A)+(B)+(C)} 77,16,242 100.00 77,16,242 41.23Public Issue (E) 1,10,00,000 58.77Total post issue share capital {(F)= (D)+(E)} 1,87,16,242 100.00

Note: The shareholding pattern after the Issue is on the assumption that full allotment is done on all the shares offeredthrough this Issue.

18


18. On the date of filing the Prospectus with SEBI, there are no outstanding financial instruments or any other rightswhich would entitle the existing promoters or shareholders or any other person, any option to receive equity sharesafter the Issue.

19. The Company has not issued any Equity Shares out of revaluation reserves.

20. There would be no further issue of capital whether by way of issue of bonus shares, preferential allotment, rightissue or in any other manner during the period commencing from submission of this Prospectus with SEBI until theEquity Shares offered through this Prospectus have been listed or all monies have been refunded to all investors.

21. The Company presently does not have any intention or proposal to alter its capital structure for a period of sixmonths from date of opening of the Issue, by way of split/consolidation of the denomination of Equity shares orfurther issue of Equity shares (including issue of securities convertible into Equity Shares) whether preferential orotherwise. However, during such period or a later date, it may issue Equity Shares pursuant to the plan or issueEquity shares or securities linked to equity shares to finance an acquisition, merger or joint venture or as considerationfor such acquisition, merger or joint venture, or for regulatory compliance or such other scheme of arrangement ifan opportunity of such nature is determined by its Board of Directors to be in the interest of the Company.

22. At any given point of time there shall be only one denomination for a class of Equity Shares of the Company,unless otherwise permitted by law and the Company shall comply with disclosures and accounting norms as maybe specified by SEBI from time to time

23. The Company has 45 (Fourty Five) shareholders as on the date of filing of this Prospectus with the SEBI.

24. Restrictive conditions under lenders agreements about capital structure

There are restrictive covenants in agreements we have entered into with certain banks for term loans and long-termborrowings. These restrictive covenants require us to seek the prior permission of the said banks for variousactivities, including, amongst others, alteration of our capital structure, raising of fresh capital, undertaking newprojects, undertaking any merger/ amalgamation/restructuring, investing by way of share capital in or lend oradvance funds to or place deposits with any other concern, secured or unsecured borrowings, undertaking guaranteeobligations, declaration of dividend not exceeding 20% of the net profits and change in management.

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OBJECTS OF THE ISSUE

The Company has chalked out the following expansion and extension of existing line of activity:

1) Expansion of existing installed capacity for manufacturing injection moulded household products at Daman from5400 MTPA to 9000 MTPA.

2) Setting up manufacturing facilities with an installed capacity of 4,900 MTPA to manufacture new high value PVC –Wood composite profile / sheets at Daman.

In addition to the above plans, the objects of the issue also include the following:

� Funding margin money requirement for working capital of the company

� Meeting issue expenses and contingency provisions

� List the shares of the company on the stock exchanges

� Repayment of bank borrowings

The main objects clause and objects incidental or ancillary to the main objects clause of the Memorandum of Association ofour Company enables us to undertake our existing activities and the activities for which the funds are being raised throughthe present issue.

APPRAISAL

The project has been appraised by the Corporate Finance Department of BOB Capital Market Ltd., Mumbai as per theirreport given in the month of September, 2005 which was revised on account of exchange rate fluctuation and acquisition ofAlaska Industries from internal accruals. A revised appraisal report was given in November, 2005. The scope and purposeof the appraisal was to study the financial aspects of the proposed expansion and extension of existing plans and to accessthe financial viability of the proposed capital expenditure plan. Appraisal Report of BOB Capital Markets Ltd. has been usedas a basis of this document wherever required. BOB Capital Markets Ltd. vide their letter dated November 19, 2005 hasgiven its consent for their name being included as an appraising agency and for their appraisal report being used in thisOffer Document. However, the Appraiser is not having any financial commitment in proposed project expansion.

COST OF PROJECT

The summary of the expenditure that the Company proposes to incur for implementing its projects is as follows:

A. Cost of Project Amount (Rs. In Lakhs)

Expansion of existing installed capacity from 5400 MTPA to 9000 MTPA 234.00

Setting up manufacturing of high value PVC - wood composite profile / sheet 1749.00

Working Capital Margin for existing, expansion and extension purpose 875.00

Public Issue Expenses 250.00

Provision For Contingency 140.00

Sub-Total (A) 3248.00

B. Repayment of Bank Borrowings 440.00

TOTAL (A + B) 3688.00

MEANS OF FINANCE

The aggregate fund requirement as mentioned above i.e. Rs. 3688 Lakhs is proposed to be met as under:

Particulars Total (Rs. In Lakhs)

Public Issue of 1,10,00,000 equity shares of Rs. 10/- each at a price of Rs. 32/- 3520.00

Internal Accruals* 168.00

TOTAL 3688.00

As on March 31, 2006, the Company have liquid assets worth Rs. 1690.77 lakhs.

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RATIONALE OF THE PROJECT

The Company plans to achieve the following objectives by undertaking the proposed capital expenditure:

� Broad base its product range to cater to various consumers so that the contribution of any particular consumersegment does not account for a large portion of the Company’s sales.

� Counter the threat of the un-organized sector by introducing new value added products.

� Achieve economies of scale in existing product range by increasing capacity.

� Maintain competitiveness in the existing product range by improving technology.

PROJECT OF THE COMPANY IS DIVIDED IN TWO PARTS

1. EXPANSION OF EXISTING BUSINESS

The Company’s existing operations of injection moulded household products are located at Daman with an area of4900 sq. mts. In order to reduce the project implementation period, the company has recently purchased the assetsand business of Alaska Industries, a promoter group entity, including 1850 sq. mts. of land with ready RCCconstructed factory building, for a total consideration of Rs. 300 lakhs. The location of the land is in Daman, whichis adjacent to Mumbai. The land is free from all encumbrances except for equitable mortgage created in favour ofUTI Bank who has extended term loan of Rs. 150 lakhs for the purchase of business from Alaska Industries.

Dyes and Moulds purchased from Alaska Industries worth Rs. 125 Lakhs is to be used for the expansion of existingoperation. A total of Rs. 42 lakhs is required to be spent on civil works / renovation for the expansion and thebalance on purchase of plant & machinery. The details of cost of expansion of existing project are as under:

Cost of Expansion Amount (Rs. In Lakhs)

Civil works 25.00

Plant & Machinery 192.00

Cabling, Water chillers and other Miscellaneous Assets 17.00

Total 234.00

Details of Civil work & Foundations

As per quotation given by M/s Jatin U Desai, Engineers & Contractors, dated October 24, 2005, the cost of civilworks is Rs. 25 lakhs, the details of which are as follows:

S. No. Item of work Amount(Rs. In Lakhs)

1. Work for alteration / renovation 5.00

2. Providing and Construction of Mezzanine Work 12.00

3. Foundation for Machine & Compressor 5.00

4. Work for Cooling Tower and Providing and Construction of Cable & 3.00Water Trench for Machine.

TOTAL 25.00

Details of Plant and Machinery

The main plant which is used for setting up the project is injection moulding machines for making thermowareproducts and the company is currently using that plant & machinery of Woojin Selex Co. Ltd, Korea and is satisfiedwith the after sales support from them. The Company, therefore, decided to procure the plant and machinery forincreasing the capacity of existing product range from Woojin Selex Co. Ltd of Korea only. The Company hasreceived a quotation from Woojin Selex Co. Ltd. of Korea dated March 21, 2005 for the following machineries:

21


Plant No. of Set Total Amount (In U.S.D)

Injection Moulding Machine Selex S-85 2 73,800




Total - 2,73,600

Add: Freight & insurance 3% 8,208

Add: Custom Duty 35% 98,633

Add: Clearing Forwarding 3% 8,454

Total Cost in USD - 3,88,895

Total Cost in Indian Rupees (1 USD = Rs 46) Say 1,78,89,170

Spare parts and ancillary machinery (In Indian Rs.) 7% 12,52,242

Total (Rs. In Lakhs) 192.00

(Source: Appraisal Report)

Details of Cabling, Water chillers and other Miscellaneous Assets

S. No. Item Amount(Rs. In Lakhs)

1 Cable & Pipe fittings 4.00

2 Water Chiller 2.00

3 Overhead Crane 7.85

4 Miscellaneous Assets 3.15

17.00


RAW MATERIAL REQUIREMENT FOR EXPANSION:

The major raw material required are Poly Propylene, Isocyanate & Polyol. The other Raw materials are packingmaterial, PP belts, Stickers, Foils, Stainless Steel containers etc.

The Company currently procures Poly Propylene from Reliance, IPCL, Haldia and Isocynate & Polyol from SharpChemical, Royal Synthetics, Manali Petrochemicals Ltd. as these are available locally. There is an adequateavailability of these raw materials in India and in the overseas market. The Company has not entered into anydefinitive agreement with the raw material suppliers in the past and is not proposing to enter into any agreement forits future requirement as it had never faced any problem in procuring them.

OTHER INFRASTRUCTURE FACILITIES FOR EXPANSION

As the company is proposing expansion at its existing facilities, it will be largely utilising its existing infrastructurefacilities like water and fuel.

Power

The company is having total sanctioned load of 500 KVA from the transformer of 500 KVA, out of which thecompany has received the release order of 200 KVA from Electricity department, Daman & Diu. The Company doesnot require additional sanction load of power as the existing power connectivity is sufficient for expansion activity.The company also propose to acquire 500 KVA Capacity of DG sets as standby arrangement.

22


Water

The water requirement is mainly for cooling, drinking and sanitary purposes. Its total requirement including expansionis 10000 litres per day, which is fulfilled from tubewell and connection from Public Works Department Daman. TheCompany has two underground water tanks with the storage capacity of 10000 litres each as a standby arrangement.

Fuel

The company requires Diesel for Diesel Generating Sets, which is used as standby arrangement of power in thecompany, and the same is easily available in the near vicinity of the company.

Effluent Treatment

The company does not generate any solid, liquid or gaseous effluents and has already obtained no objectioncertificate from Pollution Control committee, Daman & Diu and Dadra & Nagar Haweli. Since the company isexpanding its activity in the same line of product, so the Company is not required to take further N.O.C for theexpansion.

2. EXTENSION OF EXISTING LINE OF ACTIVITY

Project to manufacture Value Added Products – PVC Wood Profile / Sheets

The company is proposing to manufacture value added products at Daman in the new unit admeasuring total areaof 1850 sq. mts., which company has recently purchased from Alaska Industries, a promoter group concern.

Total area of 1850 sq.mts. will be utilised for manufacture of value added products. The detail of cost of setting upthe said facility is as under:

Cost of Project Amount (Rs. In Lakhs)

Renovation Cost of Factory Building 50.00

Imported Plant & Machinery 1345.00

Misc. Fixed Assets 174.00

Marketing & Brand Building 100.00

Preliminary & Pre Operating Expenses 80.00

Total 1749.00

Renovation Cost for the Factory Building

As per quotation given by M/s Jatin U Desai, Engineers & Contractors, dated October 24, 2005, the cost forrenovation of the factory taken over from Alaska Industries is estimated at Rs 50 lakhs as details given below:

Sr. No. Particulars of Expenditure Amount (In Rs. lakhs)

1. Work in Production Area

� Moulding Area 3.49

� Blowing Area 2.72

2. Constructing of Mezzanine area 12.28

3. Preparing of underground water tank 3.00

4. Preparing of new toilet block 3.45

5. Installation of Windows and expenditure on ventilation system 2.10

6. Construction of Second Floor 18.52

7. Concreating of plot area around the factory 4.44

Total 50.00


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Plant & Machinery

After comparing the productivity parameters of various machinery suppliers, the Company has selected Tung TaiMachine Work Co. Ltd of Taiwan for supply of machinery for manufacturing PVC Wood Composite Profile / Sheets.Tung Tai Machine Work Co. Ltd. of Taiwan is a machinery supplier registered in Taiwan, and started his operationsin 1963 and has been specializing in supplying of machinery and turnkey implementation of projects. Tung TaiMachine Work Co. Ltd is an ISO 9001:2000 approved Company under RWTUV& CE International quality standard.The paid – up Capital of Tung Tai Machine Work Co. Ltd. is $1,05,00,000 and the annual turnover for the financialyear ending December 31, 2004 was $5130000.

The total cost of importing the machinery is estimated at Rs 1345.00 lakhs and the details as per the quotationdated May 17, 2005 given by Tung Tai Machine Work Co. Ltd. is as follows:

Sr. No. Particulars Model Qty. FOB in USD TOTAL USD

(A) Imported

1 PVC Wood Composite Extruding Machines TDP-65TH 1 128000 1280002 PVC Wood Composite Extruding Machines TPF-90TD 1 286000 2860003 PVC Wood Composite Extruding Machines TPF-65TH 2 228000 4560004 PVC Wood Composite Extruding Machines TCE-35 2 13200 264005 PVC Wood Composite Extruding Machines TPF-50H 2 51000 1020006 Semi-Automatic Type Dosing System 2 - 49000 980007 Screw Type Conveyer 3 - 11000 330008 High Speed Mixer TMX-300L 2 48000 960009 High Speed Mixer TMX-500L 1 56000 5600010 Two Colour Printing 2 - 78000 15600011 Single-Head Welding Machine TSW-1 2 8000 1600012 Twin-Head Welding Machine TTW-1 2 17000 3400013 Single-Head Miter Saw TSC-1 2 7000 1400014 Twin-Head Miter Saw TTC-1 2 11000 2200015 Corner Cleaning Machine TCC-1 2 12000 2400016 End Milling Machine TEM-1 2 5500 1100017 Liner Cleaning Machine TLC-1 2 12000 2400018 Seal Cutter TPC-1 2 6000 1200019 50 HP Crusher TSC-50 2 18200 3640020 15 HP Air Compressors TTA-150 4 2200 880021 30 Ton Chiller TDC-30 2 11000 2200022 Rigid PVC Door Profile Mould 1 76300 7630023 Freight + Insurance 87000 8700024 Technology Transfer Charges 182000 18200025 Installation + Commissioning +Training 49500 49500

Total 20,56,400FOB 20,56,400

Add: Freight & insurance @ 3% 61692CIF 21,18,092

Add: Custom Duty @ 35% 7,41,332.2Add: Clearing Forwarding @3% 63,542.76Total cost in USD 29,22,967Total Cost (in Rs. Lakhs) 13,44,56,482(assuming 1USD = 46 RUPEES)IN RS. LAKHS 1,345.00


24


Miscellaneous Assets

The total expenditure to be incurred by the Company for purchasing miscellaneous assets is estimated at Rs 174lakhs, brief details of which are as under:

Sr. No. Particulars of Machinery Amount(in Rs lakhs)

1 Electrical Fittings & Lightings 20.00

2 Air Compressor & piping 4.00

3 Material Handling Equipment 5.00

4 Fire Fighting Equipment 2.00

5 Workshop Machines 9.00

6 Vehicles 40.00

7 D.G Sets 23.00

8 Computer, Printer, Peripherals 20.00

9 Furniture and Fixture 10.00

10 Weighing Scale 2.00

11 EOT Crane 12.00

12 Fork Lift 24.00

13 Laboratory Equipment 3.00

Total 174.00


Marketing & Brand Building

The Company has provided a sum of Rs. 100 lakhs towards brand building and creation of market awareness. Asper the present plan, the Company will use advertisements through electronic media like, TV Channels, Cable TV,print media and hoarding to promote the product and the brand. The company has received a media plan fromPressman Advertisement & Marketing Ltd. dated January 13, 2005 for expense of Rs 100.00 Lakhs. The actualexpenditure on TV advertising may vary as per market scenario at the time of actual placement of advertisements.The Company also intends to participate in trade fair and exhibitions in India as well as abroad to display itsproducts.

Preliminary & Pre Operating Expenses

The Company has estimated that approx Rs 80 lakhs would be incurred towards meeting the various expensessuch as:

Sr. No. Particulars Amount (in Rs lakhs)

1 Increase in Share Capital 12

2 Appraisal fee 8

3 Loan Processing fee 3

4 Establishment Expenses 20

5 Insurance during construction period 5

6 Legal Expenses 4

7 Miscellaneous Expenses 3

8 Interest During Construction Period 25

Total 80

25


Working Capital Requirement

The total margin money for working capital requirement of the Company resulting from expanding capacity in itsexisting product range as well as introducing new high value added products such as PVC Wood Plastic isestimated to be Rs.875 lakhs for the financial year 2006 - 07.

A. Current Assets 2006-2007

Raw Material 453

Consumables & Packing materials 15

WIP 498

Finished Goods 428

Debtors 1452

Other Current Assets 378

Sub-Total (A) 3224

B. Current Liabilities

Creditors :

Goods 1385

Expenses 73

Sub-Total (B) 1458

Net Current Assets (A-B) 1766

Bank Finance 891

Margin Money for working capital 875


Public Issue Expenses

The public issue expenses have been assumed at approx 8% of the issue size offered to the public i.e. issuemanagement fees, selling commission, distribution expenses, legal fees, fees to advisors, stationery costs, advertisingexpenses and listing fees payable to the Stock Exchanges, among others, details of which are as under:

(Rs. In Lakhs)

Activity Amount

Issue Management fee, Brokerage & Selling Commission 80.00

Registrars fees 25.00

Printing & Distribution of Issue Stationery 70.00

Advertising and Marketing expenses 50.00

Other miscellaneous expenses 25.00

Total 250.00

Provision for Contingency

The Company has provided provision for contingency of Rs.140 lakhs i.e. approx 7.5% of the capital expenditureestimated at Rs. 1974 Lakhs towards expansion and extension project cost. The cost estimates are based on thequotations for majority of the capital equipments and no major change in the cost is expected. Contingencies aremainly to provide for fluctuations in prices etc.

26


Technical Arrangement.

For manufacturing high value added products such as PVC Wood Profile / sheets, the company has entered into atechnical tie-up with Tung Tai Machine Work Co. Ltd., Taiwan (Tung) for providing complete technical know-how.Details of the Memorandum of Understanding are as under:

Memorandum of Understanding was entered into between the Company and Tung on September 28, 2005 for thepurpose of import of machinery from Tung and to have access to Tung’s know how and Tung’s services to enablethe Company to manufacture, the PVC Wood products in India. Tung shall provide the know – how to the Companyin three stages:

a) Pre – planning documentation:

b) At the stage of project implementation:

c) At the stage of regular production:

Tung shall provide guarantees & support to the Company against rated production of 4900 MTPA, againstmanufacturing defects, provision of complete technical know how and assistance.

Tung will provide the maximum 120 man days technical assistance to the Company at company’s site for theproject implementation.

Tung has agreed for buy back of at least 25% of company’s products manufactured by the Bluplast.

Tung shall provide the company a license to use the technical know-how for the producing, installing and commencingof the Bluplast Factory for manufacture of the PVC Wood products and the Company shall not divulge to any thirdparty, any of the technical know-how to be provided by Tung under terms of MOU.

Manufacturing Process for High Value Added Products

The Company proposes to introduce various types of PVC – Wood Composite profiles and each of these wouldrequire different manufacturing processes depending upon the shape, size and fixture to be formed. Howeverbroadly the manufacturing process would consist of the following:

Process Flow Chart to Manufacture of PVC-WOOD

Profile Sheets

Preparing PVC-WOOD Compound

Feeding in Extruder

Calibration

Cooling

Cutting, Edge Trimming

Inspection

Final Product

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In order to manufacture PVC Wood composite profiles, wood dust, PVC resin, additives like foaming agent, stabilizerand lubricants are mixed to prepare wood PVC compound and the dry blend is stored in a silo. The dry blend andmaster batch granules (of required colour) are fed to the extruder where foaming of the extradite takes place beforeits exit from the die as foam sheets/profile is formed. The profile is extruded to dough like consistency and theprofile is then extruded through a single step die with no additional calibration and only simple water bath forcooling. The scrap material obtained from manufacturing is collected, granulated and recycled.

Raw Materials Requirements for High Value Added Products

The major raw material required for the preparation of Plastic Wood composite profiles / sheets are:

� PVC resin (Poly Vinyl Chloride); and

� Other Chemical additives

� Fine wood dust

As the manufacturing facilities of the Company are centrally located at Daman, all the main raw material is easilyavailable locally. The main suppliers of PVC resin such as Reliance, IPCL, Finolex, National Organic Chemicals Ltdhave their sales depots / dealers in Daman and the Company can buy its raw material requirement from any of theabove suppliers.

The requirement of other raw materials like calcium carbonate, stabilizers, expanding agent, UV stabilizers, fillers &dyes would be met from domestic sources as well as from overseas market.

Wood dust is locally available in abundance. Wood dust is easily available in the un-organized sector and can alsobe imported if required.

The sources of wood particles can broadly classified as:

Primary wood wastes: these are post-industrial wood wastes from sawmills

Secondary wood wastes: these are post-industrial wood wastes generated when wooden products, such asfurniture, cabinets and doors are made

Post-consumer wood wastes: this can include anything from construction and demolition debris to packaging,crates and pallets.

Key Infrastructural facilities for High Value Added Products

a) Power

After taking over the unit of Alaska Industries, the Company has the ready power connection with 500 KVATransformer, with released order of 175 KVA. The maximum demand of power has been estimated at 360KVA for the new line of activity, which will be taken from Daman Electricity Board and the company hasalready applied for the power connection release order of the balance connected load of 185 KVA. TheCompany has also applied for the change of name in the record of Electricity Board, Daman.

b) Water

The requirement of water is mainly for cooling, drinking and sanitary purposes. Currently in the new Unit,Company has water connection from local Municipal Corporation, a Boring well and two underground watertanks with storage capacity of 10000 Litres each as standby arrangement.

c) Fuel

The Company does-not require fuel, as there is abundance of power available at the plant. In case ofemergency, fuel and diesel is available at near-by petrol pump for DG set connectivity.

d) Effluent Treatment Plant

The process does not generate any effluents.

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e) Manpower

For the proposed project to introduce high value added products, the Company proposes to employ around90 people which would comprise of nineteen managerial and technical people, twenty two sales andadministrative staff members and balance forty nine would be skilled/unskilled workers. The Company doesnot envisage any problem in recruiting the required personnel as the project is established in an industrialestate at Daman.

SCHEDULE OF IMPLEMENTAION

The Company is proposing to implement both the projects simultaneously and as a result commercial production is expectedto commence by August 2006.

S. Particulars Commencement Date Completion DateNo.

1. Expansion of Capacity for Existing Product Range January 2006 December, 2006from 5400 MTPA to 9000 MTPA

a) Civil Work January, 2006 July, 2006

b) Plant & Machinery (Order & Delivery) June, 2006 September, 2006

c) Erection of Plant & Machinery October, 2006 October, 2006

d) Trial Production November, 2006 November, 2006

e) Commercial Production December, 2006

2. Setting-up of facilities for manufacture of PVC Wood January 2006 December 2006composite profile and sheets (plastic wood) withinstalled capacity of 4900 MTPA

a) Civil work January, 2006 July, 2006

b) Order for Plant & Machinery June, 2006 September, 2006

c) Erection of Plant & Machinery September, 2006 October, 2006

d) Trial Production November, 2006 November, 2006

e) Commercial Production December, 2006

YEAR-WISE DEPLOYMENT OF FUNDS ON THE PROPOSED EXPANSION AND EXTENSION PLAN (Rs. in lakhs)

S. Particulars Period TotalNo. Up to March 2005-06 2006- 2007

1. Expansion of Capacity for Existing Product NIL 234 234Range from 5400 MTPA to 9000 MTPA

2. Setting-up of facilities for manufacture of PVC 12.50 1736.50 1749Wood composite profile and sheets(plastic wood) with installed capacity of 4900 Ton p.a.

3. Working Capital Margin NIL 875 875

4. Provision for Contingencies NIL 140 140

5. Public Issue Expenses 57.55 192.45 250

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Funds Deployed Till date and the sources of such expenditure

As per certificate by M/s. Singrodia Goyal & Co, Auditors of the Company dated May 2, 2006, till date the company hasdeployed funds as mentioned hereunder.

Sr. No. Purpose Source Amount (Rs. In Lakhs)

1. Preliminary & Preoperating Expenses Internal Accruals 12.50

2. Public Issue Expenses Internal Accural 57.55

TOTAL 70.05

Interim Use of Proceeds

Pending any use as described above, the Company intends to invest the proceeds of this Issue as fixed deposits with anyscheduled commercial bank. The investment would be authorised by Board of Directors of the Company or a duly authorisedcommittee thereof.

Any increase in the cost of the project is intended to be funded by Internal Accruals.

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BASIS FOR ISSUE PRICE

The present Issue consists of 1,10,00,000 equity shares of Rs.10 each issued for cash at a price of Rs. 32 per Equity Shareaggregating to Rs. 3520 lakhs.

Qualitative Factors:

� BIL is an existing profit making Company with track record in terms of turnover and profitability.

� The Company has marketing network in all over India with 98 distributors and a network of dealers and subdealers spread throughout India..

� An ISO 9001:2000 certified Company.

� Existing as well as the proposed plant has a locational advantage on account of vicinity of existing market, rawmaterial availability, Low Power and Labour cost.

� The supplier of imported plant & machinery has agreed to buy-back 25% of production of PVC Wood CompositeProfile / Sheets

Quantitative Factors:

1. Adjusted Earning Per Equity Share

Year Earning per Equity Share Weight

2003-04 3.62 1

2004-05 4.54 2

2005-06 2.62 3

Weighted Average 3.43 6

2. Price / Earning Ratio (P/E) in relation to the Issue Price of Rs. 32/-

Based on the adjusted EPS for the year ended March 31, 2006 of Rs. 2.62 12.21

Based on the weighted average EPS of Rs. 3.43 9.33

Industry P/E* - Plastic Products

i) Highest 229.3

ii) Lowest 0.90

iii) Average 19.20

Source: Capital Market April 24 – May 7, 2006 (Plastic Products)

3. Return on Net worth (RoNW)

Year RoNW (%) Weight

2003-04 27.12 1

2004-05 21.41 2

2005-06 12.90 3

Weighted Average 18.11 6

4. Minimum Return on Increased Net Worth required to maintain Pre-Issue EPS (FY 2006) of Rs. 2.62 is 10.18% atthe issue price of Rs. 32/-.

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5. Net Asset Value per share (NAV)

Adjusted NAV (Rs.)

As on March 31, 2006 16.79

After the Issue 25.73

Issue Price 32.00

6. Comparison with Industry Peers

The comparable ratios of the companies which are to some extent similar in business are as given below:

Particulars EPS (Rs.) P/E (times) Book Value (Rs.) RONW(%)

Wim Plast 1.2 32.3 81.0 2.10

Caprihans India 6.9 12.7 60.5 12.10

Nilkamal Plastic 14.6 18.8 142.2 10.90

Source: Capital Market April 24 – May 7, 2006 (Plastic Products)

The face value of the shares of the Company is Rs. 10/- per share, issued at Price of Rs. 32 per equity share. The Issue Priceis 3.2 times of the face value of the Equity Shares. Lead Manager believes that the Issue Price of Rs. 32 is justified in viewof the above qualitative and quantitative parameters. Investors should read the section titled “Risk Factors” beginning onpage iii, the financial statements included in this Prospectus and the section titled “Management Discussion and Analysis offinancial condition and results of operations” beginning on page 91 of this Prospectus. The trading price of the equity sharesof the Company could decline due to these factors and you may lose all or part of your investments.

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STATEMENT OF TAX BENEFITS

Board of Directors,Bluplast Industries Limited,113 / 114, Vivek Industrial Estate,Uswala Road, Near Litolier,Cama Estate, Goregaon (E)Mumbai - 400 063

Dear Sirs,

We hereby certify that the enclosed annexure states the tax benefits available to Bluplast Industries Limited (“the Company”)and to the shareholders of the Company under the provisions of the Income Tax Act, 1961 and other direct tax laws presentlyin force.

The contents of this annexure are based on information, explanations and representations obtained from the Company andon the basis of our understanding of the business activities and operations of the Company.

A shareholder is advised to consider in his/her/its own case, the tax implications of the investment in the equity sharesparticularly in view of the fact that certain recently enacted legislation may not have legal precedent or may have a differentinterpretation on the benefits, which an investor can avail.

For Singrodia Goyal & Co.

Chartered Accountants

Sd/-

Suresh Murarka

PartnerM.No. 44739

Place : MumbaiDate : May 5, 2006

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Annexure to the Statement of Tax Benefits

Benefits available to the Company under the Income Tax Act, 1961.

1. Under Section 10(34) of the Act, dividend income referred to in section 115-O (whether interim or final) declared,distributed or paid by any other on or after April 1, 2003 is completely exempt from tax in the hands of theCompany.

2. As per the provisions of Section 112(1)(b) of the Act, long –term capital gains would be subject to tax at the rate of20% (plus applicable surcharge and education cess). However, as per the proviso to section 112(1)(b), the longterm capital gains resulting on transfer of listed securities or units [not covered by section 10(36) and 10(38)], wouldbe subject to the tax at the rate of @ 10% without indexation benefits (plus applicable surcharge and educationcess) at the option of the assessee.

3. Long term capital gain arising from transfer of an ‘eligible Equity Share’ in a company purchased on or after 1st dayof March 2003 and before the 1st day of March 2004 (both days inclusive) and held for a period of 12 months ormore is exempt from tax under section 10 (36) of the Income Tax Act, 1961.

4. As per the provisions of section 10(38), long term capital gain arising from the sale of equity shares in anyCompany through a recognized stock exchange or from the sale of units of an equity –oriented mutual fund shallbe exempt from income tax if such sale takes place after 1st of October 2004 and such sale is subject to SecuritiesTransaction Tax. However, in the case of a company-member liable to pay MAT, the book profits on sale of suchshares shall be included in computing the MAT liability.

5. The Company is eligible under section 35D of the Act to a deduction equal to one-fifth of certain specified expenditure,including specified expenditure incurred in connection with the extension of an Industrial Undertaking, for a periodof five successive years subject to the limits prescribed and the conditions specified under the said section.

6. As the provisions of section 111A, Short Term Capital gains arising from the transfer of equity shares in anyCompany through a recognized stock exchange or from the sale of units of equity –oriented mutual fund shall besubject to tax @ 10% (plus applicable surcharge and education cess) provided that such transaction is entered intoafter the 1st day of October, 2004 and the transaction is subject to Securities Transaction Tax.

7. In accordance with and subject to the conditions and to the extent specified in section 54EC of the Act, theCompany would be entitled to exemption from tax on gains arising from transfer of the long term capital asset (notcovered by section 10 (36) and 10 (38)) if such capital gain is invested in any of the longterm specified assets(Bonds issued by NHAI or RECL) in the manner prescribed in the said section. Where the long term specified assetis transferred or converted into money at any time within a period of three years from the date of its acquisition, theamount of capital gains exempted earlier would become chargeable to tax as long term capital gains in the year inwhich the longterm specified asset is transferred or converted into money.

8. As per the provisions of section 88E, where the business income of a resident includes profits and gains from saleof taxable securities, a rebate shall be allowed from the amount of income tax equal to the Securities TransactionTax paid on such transactions. However the amount of rebate shall be limited to the amount arrived at by applyingthe average rate of income tax on such income.

9. The company had set up a manufacturing unit for the manufacturing of plastic items at Daman (U.T.), a backwardstate specified in the Eighth Schedule to the Income Tax Act, 1961, during the Financial Year 2000-01. The aboveunit has fulfilled all the conditions prescribed under sub section 4 of section 80 IB of the Income Tax Act, 1961, forinitial eligibility for deduction. Accordingly, subject to fulfilment of other regular conditions, the company is eligiblefor a deduction equal to 100% of the profit and gain derived from such industrial undertaking for five assessmentyears beginning with the initial assessment year i.e. AY 2001-02 and thereafter equal to 30% of the profit and gainderived from such industrial undertaking for next five assessment years.

Benefits available to Resident Shareholders under the Income Tax Act, 1961

1. Under Section 10(34) of the Act, dividend income referred in section 115-O (whether interim or final) declared,distributed or paid by the Company on or after April 1, 2003 is completely exempt from tax in the hands of theshareholders of the Company.

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2. As per the provisions of Section 112(1)(b) of the Act, long term capital gains would be subject to tax at the rate of20% ( plus applicable surcharge and education cess). However, as per the provision to section 112(1) (b), the longterm capital gains resulting on transfer of listed securities or units (not covered by section 10(36) and 10(38), wouldbe subject to the tax at the rate of @ 20% with indexation benefits or 10% without indexation benefits (plusapplicable surcharge and education cess) as per the option of the assessee.

3. As per the provisions of section 10 (32) of the Income Tax Act, 1961, any income of minor children is clubbed withthe Total Income of the parents as per the provisions of section 64 (1A) of the I.T. Act, will be exempt from the taxto the extent of Rs. 1500/- per minor child.

4. As per the provisions of section 10(38), long term capital gain arising from the sale of Equity Shares in anyCompany through a recognized stock exchange or from the sale of units of an equity oriented mutual fund shall beexempt from income tax if such sale takes place after 1st of October 2004 and such sale is subject to SecuritiesTransaction Tax. However, in the case of a company-member liable to pay MAT, the book profits on sale of suchshares shall be included in computing the MAT liability.

5. As the provisions of section 111 A, Short Term Capital gains arising from the transfer of Equity Shares in anyCompany through a recognized stock exchange or from the sale of units of equity –oriented mutual fund shall besubject to tax @ 10% provided such a transaction is entered into after the 1st day of October, 2004 and thetransaction is subject to Securities Transaction Tax.

6. As per the provisions of section 88E, where the business income of a resident includes profits and gains from saleof taxable securities, a rebate shall be allowed from the amount of income tax equal to the Securities TransactionTax paid on such transactions. However the amount of rebate shall be limited to the amount arrived at by applyingthe average rate of income tax on such income.

7. Long term capital gain arising from transfer of an ‘eligible Equity Share’ in a company purchased on or after 1st dayof March 2003 and before the 1st day of March 2004 (both days inclusive) and held for a period of 12 months ormore is exempt from tax under section 10 (36) of the Income Tax Act, 1961.

8. In accordance with and subject to the conditions and to the extent specified in section specified 54EC of the Act,the shareholders would be entitled to exemption from tax on gains arising on transfer of their shares in theCompany (not covered by section 10 (36) and 10 (38)) if such capital gain is invested in any of the long- termspecified assets in the manner prescribed in the said section. Where the long term specified asset is transferred orconverted into money at any time within a period of three years from the date of its acquisition, the amount ofcapital gains exempted earlier would become chargeable to tax as long term capital gains in the year in which thelong- term specified asset is transferred or converted into money.

9. In case of a shareholder being an individual or a Hindu Undivided family, in accordance with and subject to theconditions and to the extent specified in section 54F of the Act, the shareholder would be entitled to exemption fromlong term capital gains on the sale of shares in the Company (not covered by sections 10 (36) and 10 (38)), uponinvestment of net consideration in purchase / construction of a residential house. If part of net consideration isinvested within the prescribed period in a residential house, then such gains would be not chargeable to tax on aproportionate basis. Further, if the ‘residential house in which the investment has been made is transferred withina period of three years from the date of its purchase or construction, the amount of capital gains shall be chargedto tax as long-term capital gains in the year in which such residential house is transferred.

Benefits available to Non-Resident Indian Shareholders

1. Under Section 10(34) of the Act, dividend referred to section 115 O (whether interim or final) declared, distributedor paid by the Company on or after April 1, 2003 is completely exempt from tax in the hands of the shareholdersof the Company.


3. In the case of shareholder being a non-resident Indian and subscribing to shares in convertible foreign exchange,in accordance with and subject to the conditions and to the extent specified in section115D read with section 115E

35


of the Act, long term capital gains arising from the transfer of an Indian Company’s shares (not covered by sections10(36) and 10(38)), will be subject to tax at the rate of 10% as increased by a surcharge and education cess at anappropriate rate on the tax so computed, without any indexation benefit but with protection against foreign exchangefluctuation.

4. In the case of a shareholder being a non-resident Indian and subscribing to shares in convertible foreign exchange,in accordance with and subject to the conditions and to the extent specified in section115F of the Act, the non-resident Indian shareholder would be entitled to exemption from long term capital gains ( not covered by sections10(36) and 10(38)), on the transfer of shares in the Company upon investment of net consideration in modes asspecified in sub-section (1) of section 115F.

5. In accordance with the provisions of section 115G of the Act, Non Resident Indians are not obliged to file a returnof income under Section 139(1) of the Act, if their only source of income is income from investments or long termcapital gains earned on transfer of such investments or both, provided tax has been deducted at source from suchincome as per the provisions of Chapter XVII-B of the Act.

6. In accordance with the provisions of Section 115H of the Act, when a Non Resident Indian become assessable asa resident in India, he may furnish a declaration in writing to the Assessing Officer along with his return of incomefor that year under Section 139 of the Act to the effect that the provisions of Chapter XII-A shall continue to applyto him in relation to such investment income derived from the specified assets for that year and subsequentassessment years until such assets are converted into money.

7. As per the provisions of section 115 I of the Act, a Non –Resident Indian may elect not to be governed by theprovisions of chapter XII-A for any assessment year by furnishing his return of income for that year under section139 of the Act, declaring therein that the provisions of chapter XII-A shall not apply to him for the assessment yearand accordingly his total income for that assessment year will be computed in accordance with the other provisionsof the Act.

8. In accordance with and subject to the conditions and to the extent specified in section 112(1)(b) of the Act, tax onlong term capital gains arising on sale on listed securities or units not covered by sections 10(36) and 10(38) willbe at the option of the concerned shareholder, 10% of the capital gains (computed without indexation benefits) or20% of capital gains (computed with indexation benefits) as increased by a surcharge and Education cess at anappropriate rate on the tax so computed on either case.

9. As per the provisions of section 10(38), long term capital gain arising from the sale of Equity Shares in anyCompany through a recognized stock exchange or from the sale of units of an equity –oriented mutual fund shallbe exempt from income tax if such sale takes place after 1st of October 2004 and such sale is subject to SecuritiesTransaction Tax. However, in the case of a foreign company-member having an office in India and liable to payMAT, the book profits on sale of such shares shall be included in computing the MAT liability.

10. As the provisions of section 111 A, Short Term Capital gains arising from the transfer of Equity Shares in anyCompany through a recognized stock exchange or from the sale of units of equity –oriented mutual fund shall besubject to tax @ 10% provided such a transaction is entered into after the 1st day of October, 2004 and thetransaction is subject to Securities Transaction Tax.

11. As per the provisions of section 88E, where the business income of a assessee includes profits and gains fromsale of taxable securities, a rebate shall be allowed from the amount of income tax equal to the Securities TransactionTax paid on such transactions. However the amount of rebate shall be limited to the amount arrived at by applyingthe average rate of income tax on such business income.

12. In accordance with and subject to the conditions and to the extent specified in Section 10(36) of the Act, theshareholders would be entitled to exemption from long term capital gain tax on transfer of their ‘eligible EquityShares’ in the Company purchased during the period March 1, 2003 to February 29, 2004 (both days inclusive)and held for a period of 12 months or more.

13. In accordance with and subject to the conditions and to the extent specified in section specified 54EC of the Act,the shareholders would be entitled to exemption from tax on long term capital gains arising on transfer of theirshares in the Company (not covered by section 10(36) and 10 (38)) if such capital gain is invested in any of thelong- term specified assets in the manner prescribed in the said section. Where the long term specified asset is

36


transferred or converted into money at any time within a period of three years from the date of its acquisition, theamount of capital gains exempted earlier would become chargeable to tax as long term capital gains in the year inwhich the longterm specified asset is transferred or converted into money.

14. In case of a shareholder being an individual or a Hindu Undivided family, in accordance with and subject to theconditions and to the extent specified in section 54F of the Act, the shareholder would be entitled to exemption fromlong term capital gains on the sale of shares in the Company (not covered by sections 10 (36) and 10 (38)), uponinvestment of net consideration in purchase / construction of a residential house. If part of net consideration isinvested within the prescribed period in a residential house, then such gains would be not chargeable to tax on aproportionate basis. Further, if the residential house in which the investment has been made is transferred within aperiod of three years from the date of its purchase or construction, the amount of capital gains tax exempted earlierwould become chargeable to tax as long-term capital gains in the year in which such residential house is transferred.

15. As per the provisions of Section 90(2) of the Act, the provisions of the Act would prevail over the provisions of thetax treaty to the extent they are more beneficial to the Non-Resident.

Benefits available to other Non-residents

1. Under Section 10(34) of the Act, dividends referred to in section 115-O (whether interim or final) declared, distributedor paid by the Company on or after April 1, 2003 is completely exempt from tax in the hands of the shareholdersof the Company.


3. In accordance with and subject to the conditions and to the extent specified in section 112(1) (b) of the Act, tax onlong term capital gains arising on sale on listed securities or units before 1st October 2004 will be at the option ofthe concerned shareholder, 10% of the capital gains (computed without indexation benefits) or 20% of capital gains(computed with indexation benefits) as increased by a surcharge and Education cess at an appropriate rate on thetax so computed on either case.

4. As per the provisions of section 10(38), long term capital gain arising from the sale of Equity Shares in anyCompany through a recognized stock exchange or from the sale of units of an equity-oriented mutual fund shall beexempt from income tax if such sale takes place after 1st of October 2004 and such sale is subject to SecuritiesTransaction Tax. However, in the case of a foreign company-member having an office in India and liable to payMAT, the book profits on sale of such shares shall be included in computing the MAT liability.

5. As the provisions of section 111 A, Short Term Capital gains arising from the transfer of Equity Shares in anyCompany through a recognized stock exchange or from the sale of units of equity-oriented mutual fund shall besubject to tax @ 10% provided such a transaction is entered into after the 1st day of October, 2004 and thetransaction is subject to Securities Transaction Tax.

6. As per the provisions of section 88E, where the business income of an assessee includes profits and gains fromsale of taxable securities, a rebate shall be allowed from the amount of income tax equal to the Securities transactiontax paid on such transactions. However the amount of rebate shall be limited to the amount arrived at by applyingthe average rate of income tax on such business income.


8. In accordance with and subject to the conditions and to the extent specified in Section 54EC of the Act, theshareholders would be entitled to exemption from tax on gains arising on transfer of their shares in the Companynot covered by sections 10(36) and 10(38)) if such capital gain is invested in any of the long term specified assetis transferred or converted into money at any time within a period of three years from the date of its acquisition, theamount of capital gains exempted earlier would become chargeable to tax as long term capital gains in the year inwhich the long-term specified asset is transferred or converted into money.

37


9. In case of a shareholder being an individual or a Hindu Undivided Family, in accordance with and subject to theconditions and to the extent specified in Section 54F of the Act, the shareholder would be entitled to exemptionfrom long term capital gains (not covered by sections 10(36) and 10(38)) on the sale of shares in the Companyupon investment of net consideration in purchase/construction of a residential house. If part of net consideration isinvested within the prescribed period in a residential house, then such gains would not be chargeable to tax on aproportionate basis. Further, if the residential house in which the investment has been made is transferred within aperiod of three years from the date of its purchase or construction, the amount of capital gains tax exempted earlierwould become chargeable to tax as long term capital gains in the year in which such residential house is transferred.


Benefits available to Foreign Institutional Investors (‘FII’)

1. Under Section 10(34) of the Act, dividends referred to in section 115-O (whether interim or final) declared, distributedor paid by the Company on or after April 1, 2003 is completely exempt from tax in the hands of the shareholdersof the Company.

2. In case of a shareholder being a Foreign Institutional Investor (FII), in accordance with and subject to the Conditionsand to the extent specified in Section 115AD of the Act, tax on long term capital gain (not covered by sections10(36) and 10(38)) will be 10% and on short term capital gain will be 30% as increased by a surcharge andeducation cess at an appropriate rate on the tax so computed in either case. However short term capital gains onsale of Equity Shares of a Company through a recognised stock exchange or a unit of an equity oriented mutualfund effected on or after 1st October 2004 and subject to Securities transaction tax shall be taxed @ 10% as perthe provisions of section 111A. It is to be noted that the benefits of Indexation and foreign currency fluctuationprotection as provided by Section 48 of the Act are not available to FII.


4. As per the provisions of section 10(38), long term capital gain arising from the sale of Equity Shares in anyCompany through a recognised stock exchange or from the sale of units of an equity oriented mutual fund shall beexempt from Income Tax if such sale takes place after 1st of October 2004 and such sale is subject to SecuritiesTransaction tax.

5. As per the provisions of section 88E, where the business income of an assessee includes profits and gains fromsale of taxable securities, a rebate shall be allowed from the amount of income tax equal to the Securities transactiontax paid on such transactions. However the amount of rebate shall be limited to the amount arrived at by applyingthe average rate of income tax on such business income.

6. In accordance with and subject to the conditions and to the extent specified in /section 54EC of the Act, theshareholders would be entitled to exemption from tax on long term capital gains (not covered by sections 10 (36)and 10(38)) arising on transfer of their shares in the Company if such capital gain is invested in any of the longterm specified assets in the manner prescribed in the said section. Where the long term specified assets istransferred or converted into money at any time within a period of three years from the date of its acquisition, theamount of capital gains exempted earlier would become chargeable to tax as long term capital gains in the year inwhich the long term specified asset is transferred or converted into money.


Benefits available to Mutual Funds

In case of a shareholder being a Mutual fund, as per the provisions of Section 10 (23D) of the Act, any income of MutualFunds registered under the Securities and Exchange Board of India Act, 1992 or Regulations made there under, MutualFunds set up by public sector banks or public financial institutions and Mutual Funds authorised by the Reserve Bank ofIndia would be exempt from Income Tax, subject to the conditions as the Central Government may by notification in theOfficial Gazette specify in this behalf.

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Benefits available to Venture Capital Companies /Funds

In case of a shareholder being a Venture Capital Company / Fund, as per the provisions of Section 10(23FB) of the Act, anyincome of Venture Capital Companies / Funds registered with the Securities and Exchange Board of India, would exemptfrom Income Tax, subject to the conditions specified.

Benefits available under the Wealth Tax Act, 1957

As per the prevailing provisions of the above Act, no Wealth Tax shall be levied on value of shares of the Company.

Benefits available under the Gift Tax Act

Gift tax is not leviable in respect of any gifts made on or after October 1, 1998. Therefore, any gift of shares will not attract gifttax.

Note:

1. All the above benefits are as per the current tax laws as amended by the Finance Act, 2006.

2. All the above benefits are as per the current tax law and will be available only to the sole / first named holder incase the shares are held by joint holders.

3. In respect of non-residents, the tax rates and the consequent taxation mentioned above shall be further subject toany benefits available under the double taxation avoidance agreements, if any, between India and the country inwhich the non-resident has fiscal domicile.

4. In view of the individual nature of tax consequences, each investor is advised to consult his / her own tax advisorwith respect to specific tax consequences of his / her participation in the scheme.

However, a shareholder is advised to consider in his / her / its own case, the tax implications of an investment in the EquityShares, particularly in view of the fact that certain recently enacted legislations may not have direct legal precedent or mayhave a different interpretation on the benefits which an investor can avail.

39


INDUSTRY OVERVIEW

STRUCTURE OF THE INDUSTRY

On the basis of value added, the plastic products sector contributes to around 0.5% of GDP of the country. The plastic productssector also provides for 1% of the country’s export. An estimated 0.4 million people are employed in the sector. There is apresence of the small scale companies in the industry which account for more than 50% of the industry turnover. The Indianplastic processing Industry is highly fragmented and comprises 25000 firms with more than 400000 employees. Barring 10-15% of the firms, which can be classified as medium-scale operations, all the other units operate on a small scale basis. Thetop 100 players accounts for just 20% of the industry turnover. The total number of players in the sector is more than 25000.However, the degree of fragmentation, worldwide, is large and despite the small size of operations they are able to operateprofitably, further the high growth in demand ensures that the market is able to absorb the excess capacity in quick times.


Classification of Plastic Products by Type of Process Used:

The polymer consumption in India according to various processes is as under:

Process Share in Total Consumption in India

Extrusion 75.6%

Injection Moulding 18.0%

Blow Moulding 5.10%

Rotomoulding 1.30%

Total (‘000 tonnes) 4,070


The Indian plastic processing Industry is highly fragmented and comprises 25000 firms with more than 400000 employees.Barring 10-15% of the firms, which can be classified as medium-scale operations, all the other units operate on a small scalebasis. The top 100 players accounts for just 20% of the industry turnover. The total number of players in the sector is morethan 25000. However, the degree of fragmentation, worldwide, is large and despite the small size of operations they areable to operate profitably. Further the high growth in demand ensures that the market is able to absorb the excess capacityin quick times. Overall, the degree of competition can be considered high in the Indian Plastic processing industry.

The sector has a significant presence of the unorganised sector, which accounts for more than 70% of the industry turnover.More than 95% of the firms in the industry are either partnership, proprietorship or private limited companies. But they will notaffect the business of company due to following reasons:

Extrusion Rotomoulding Blow Moulding

Injection Moulding

Film and Sheets; Fibre and Filaments Pipes Conduits and Profiles Miscellaneous Applications

Industrial Injection Moulding Household Injection Moulding and Thermo-ware / Moulded luggage

Large Circular Tanks such as Water Tanks Bottles, Containers, Toys

and Housewares

Plastic Products

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1. Introduction of VAT: Earlier before the introduction of VAT unorganized sectors normally sell their products withoutBill and evade the taxes. Now By introduction of Value Added Tax by The Finance Budget 2005 the unorganizedsectors are forced to sell the products under VAT bills as the purchaser insists them to supply the goods under VATbill. Due to this the price gap between organized and unorganized gets squeezed.

2. Large Capacity: The financial performance of an organized sector player improves significantly when its sizegrows. This is expected as more than 85% of the conversion cost (difference between the finished good sales andthe raw material costs) is of the fixed nature. However, as the size increases, the asset turnover falls resulting in atrade off between the two.

3. High Machine Productivity: The major capital cost of a plastic processing company is the moulding machine—whether extrusion moulding or blow moulding. The ability of the company to produce maximum number of productspossible from the machine in a given time is a critical parameter affecting the returns from the company’s investment

4. Brand Image: Many of the Plastic Products are household products like furniture, buckets, lunch boxes, bottles etc.By building strong brand image, a company can increase the premium for its products and increase the sales level.

CRITICAL SUCCESS FACTORS

The critical success factors for the firms operating in the Indian plastic processing industry are provided as follows:

Product Mix: The plastic products are used in various applications/industries—which include household, agriculture, industrialpackaging, fertiliser packaging, food grain packaging, Thus, the production needs to according to a suitable product mix soas to maximise the realisations.

Strong Brand Image: Many of the Plastic Products are household products like furniture, buckets, lunch boxes, bottles etc.By building strong brand image, a company can increase the premium for its products and increase the sales level.

Low Polymer Purchase Costs: Plastic Processing firms purchase polymer resins and convert them into useful products.The cost of polymer is nearly 60% of the realisation of the plastic product.

High Machine Productivity: The major capital cost of a plastic processing company is the moulding machine—whetherextrusion moulding or blow moulding. The ability of the company to produce maximum number of products possible from themachine in a given time is a critical parameter affecting the returns from the company’s investment.

Large Capacity: The financial performance of an organised sector player improves significantly when its size grows. This isexpected as more than 85% of the conversion cost (difference between the finished good sales and the raw material costs)is of the fixed nature. However, as the size increases, the asset turnover falls resulting in a trade off between the two.


Notwithstanding the temporary decline in demand during 2002-03 after a significantly high growth of over 10% every yearfor the last two decades, the demand for plastic products in the country is likely to continue to grow, albeit, at a slower rateof around 8-10% per annum over the medium term.

Composition of PVC-Wood Composite:

The term plastic wood composite refers to any composites that contain wood (of any form) and thermosets or thermoplastics.Thermosets are plastics that, once cured, cannot be melted again for reuse. These include resins such as epoxies andphenolics, plastics with which the forest products industry is most familiar. Thermoplastics are plastics that can be repeatedlymelted, such as polyethylene and polyvinyl chloride (PVC). Thermoplastics are used to make many diverse commercialproducts such as milk jugs, grocery bags, and siding for homes.

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Comparison of PVC Wood Composite Profile / Sheet with Wood

PVC Wood composite profile/sheet is a superior substitution for wood and can replace timber oriented product applicationsin various industries. WPC product can be worked upon like wood with respect to sawing, nailing, screwing, planning andpainting etc. The new plastic wood composite is similar to wood in look, feel and smell but with better performance thanwood. The features of the PVC Wood Profile Composite are:

i) It is water resistant

ii) It termite, insects resistance

iii) It can be manufactured in different colours

iv) It has easy workability

v) It has low maintenance cost

vi) It is humidity resistant – ideal for applications in high moisture environment

vii) It is corrosion resistant

viii) It is acid and alkali resistance

ix) It is easy to print coat and work upon

x) It is light weight and easy to work upon with greater precision

xi) No surface finishing is required

xii) It is suitable for mass production

Current Situation

Plastic – Wood Composites / Profiles are new products which have recently come in to prominence in developed countriesof Europe and USA and these products are being imported in limited quantities in India. Since the Plastic Wood Compositesindustry in India is at a very nascent stage, the industry study for these new value added products would delve on thedevelopments that are taking place in USA and Europe.

(Source: Wood Plastic Composite Studies by WRAP available on the site of www.wrap.org.uk)

Indian Perspective demand perspective:

Wood plastic composites are currently used in, or are under development for, a wide range of applications in a number ofmarket sectors including:

(i) Door frames, picture frames, furniture components, decorative material for bathrooms, kitchen

(ii) Architectural areas for wall and door paneling, partitions, bathroom and kitchen cabinets, doors, table tops andother furniture

(iii) Advertising sector for sign boards, shop window displays, manufacture of models, etc.

(iv) Other misc. applications such as manufacture of switch board, portable cabins in offices, laboratories, dining mess,housing on remote sites, shower rooms, in hotels, cabins at airports, oil exploration sites, etc.

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An exhaustive list of WPC applications is as under:

End Market Applications / Sectors

Construction Interiors Automotive Garden / Industrial / OthersOutdoor Infrastructure

Cladding – exterior, Balustrades Door and Decking Handrails Black Pianohorizontal & vertical head liners Keys

Doorframes Blinds / Ducting Fencing and Industrial Hot tubsshutters Fence posts packaging

Ducting Coving Interior panels Garden Marine pilings /Furniture bulkheads

Fascias, soffits and Dado rails Rear shelves Outhouses Pallets / Cratesbarge boards (sheds etc) TotesPre finished Decorative Spare tyre Park benches Piers / docksFloorboards profiles covers

Roofline products Interior panels Truck floors Playground Railingsequipment

Shingles Kitchen Playground Railway sleepersCabinets surfaces

Stairs Laminate Rubbish Binsfloorings

Timber Office SignageFurniture

Window frames & Shelvingcomponents

Skirting boardsSound proofingWorktops

Estimated Market in India

Technology Information, Forecasting & Assessment Council (TIFAC) which falls under the Department of Science & Technology,Govt. of India has launched the Advanced Composites Programme in order to promote the usage of plastic composites inIndia.

As per information available from TIFAC, the consumption of composite materials is estimated to be about 2.2 million MTglobally, with the Asia-Pacific region accounting for about 24% of this usage. The per capita consumption of composites inUSA and China today stand at 5.6 Kgs & 1.5 Kgs respectively vis-à-vis that of 35 grams in India. TIFAC has identified variouskey product applications such as prefabricated, portable & modular buildings, exterior cladding panels, interior decorations,furniture, bridges and architecture mouldings which have the potential for boosting the consumption level of composites inIndia.

(Source: www.tifac.org.in)

Apart from TIFAC the other study that has been undertaken for estimating the potential of Plastic – Wood Composites in Indiais the study by E-Composites, Inc. According to the report titled “Growth Opportunities in Indian Composites Market 2004-2010” published by E-Composites, Inc, composites industry in India is growing rapidly and in the last 2 years, the growth ratein Indian composites market has been in double digits. According to E-Composites, Inc. the market for finished compositesparts in India is slated to grow to US $846 million by 2010.

(Source: www.e-composites.com)

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OUR BUSINESS

Overview

Two of the promoters of the Company Mr. Kamlesh L. Jain and Mr. Indermal P. Jain have been associated with the plasticindustry for more than two decades. The promoter had started business activity in plastic product manufacturing byincorporating Bluplast Corporation in 1985. Subsequently, promoters expanded business by setting up a facility in the sameline in Daman under Alaska Industries, a group company. Later, The Promoter incorporated Thermoplast Industries PrivateLimited in 1999 with additional unit in Daman. The manufacturing plant of the Company was set up at Daman (in UnionTerritory of Daman and Diu) with an initial capacity of 1940 MTPA, which has, over a period of time, been increased up to4500 MTPA. Thermoplast Industries Private Limited later renamed as Bluplast Industries Private Limited. The Company hasacquired total manufacturing unit of Alaska Industries on July 1, 2005 and became Public Company, Bluplast IndustriesLimited, with effect from July 14, 2005. The Company has been operating at 100% capacity utilization for the past threeyears. In the FY 2004-05, to meet the demands of its products, the Company had to outsource the work of manufacturing itsproducts to sub-contractors on job work basis and as a result of which the Company manufactured 5465 MTPA against aninstalled capacity of 4500 MTPA.

In July 2005, the Company acquired the business of Alaska Industries, a group concern, having manufacturing capacity ofup to 1800 MTPA. Pursuant to the afore-cited acquisition, the Company’s manufacturing capacity increased from 4500 MTPAto 5400 MTPA. Further, during last FY 2005-06, the Company achieved 8379 MTPA against installed capacity of 5400 MTPA.

The Company manufactures plastic articles adopting the ‘Injection Moulding’ method and its product range includesThermoware, Vacuumware, Insulatedware, Kitchenware, Utilities and pet products (e.g. Casserole with the capacity of 500ml-12500ml, Lunch Packs 3-5 containers, Flasks with the capacity of 750 ml –1500 ml, water jugs with the capacity of 2000 ml-2500 ml, Water Bottles with the capacity of 500 ml – 2500 ml, Pet Jars with the capacity of 800 ml – 2500 ml, Buckets, BathStools, Bath Tubs, Baskets, Dust Bins etc.).

Our Vision

To be one of the household utility product and PVC wood composite manufacturer by offering range of products to thesatisfaction of customers at an affordable price.

Business Strategy

Our principal Operating strategies are

� To increase market share in the plastic utility household product range in Domestic Market and also increase theshare in international market.

(i) The company is increasing its installed capacity in its existing product range from 5400 MTPA to 9000 MTPA.

(ii) Broad base its product range to cater to various consumers so that the contribution of any particular consumersegment does not account for a large portion of the company’s sales.

� To be one of the major players in PVC Wood composite products by :

(i) Introducing high value added products such as PVC - Wood composite profile / sheets.

(ii) Market potential for export of PVC Wood Composite products to be explored.

Location of the Plant

The manufacturing plant of the company is located at Survey No. 709/1 to 4 & 8, 9 &710/13, Dabhel, Daman – 396210,Taluka: Daman (Union Territory of Daman and Dui). The plant is located within a radius of around 168 kms from Mumbaiand 223 km from Ahmdabad. The total area of land is 4900 sq. mtrs. The land is free from all encumbrances except for theequitable mortgage created in favour of UTI Bank Ltd. who have extended credit loan facility in the normal course of business.

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Process Flow of Manufacturing of Injection Moulded Plastic Products

The manufacturing process of injection moulded plastic products involves the following steps:-

As explained in the process flow chart above, the main steps in the manufacturing process involves:

� Raw Material and Procurement: Main Raw materials are Poly Propylene, High Density Poly ethylene and PolyEthylene Terephthalate etc., all are available in domestic market and also could be imported if needed be.

� Colour Mixing: In the first step, plastic granules are mixed with colour pigments in a mixer. This mixture is then fedinto the injection moulding machine.

� Moulding: The required mould is identified and loaded on the machine depending upon the product to bemanufactured. On the basis of the specifications for a given product, the parameters are set on the machine.Sampling of the product is done at this stage in order to keep a check on the quality of the product that is beingmanufactured. If the semi-finished (i.e. moulded) products meet with the required parameters the production iscontinued.

� Assembling: The product is then sent for manual assembly of various parts.

� Filling: The product that is manufactured is then treated with Polyol and Isocynate in specified proportion in order toimpart insulation characteristics to Thermoware / Vacuum ware products. Simultaneously, the product is inspectedfor any visual defects.

� Screening Printing and Foiling: After the inspection for defects is over, designs if any are printed on the product.The manufacturing process gets completed at this stage.

� Box Packing: The product is then packed in inner boxes.

� Cartons Packing: The inner boxes are then packed in cartons in order to minimize the possibility of damage duringtransportation. Once the packing of the products is complete in all respects, the products are sent to Finish GoodsGodown for dispatch.

� Dispatch: The products are dispatched from the Finished Goods Godown as per the orders received from clients.

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Land and Properties

The company has entered into purchase agreement with M/s Alaska Industries to take over the business concern for a totalconsideration of Rs 300 lakhs through Business Transfer Agreement. The value of the land & building which is to be used forPVC - Wood project is Rs 175 lakhs for an area of 1850 sq.mts. The plant & machinery is valued at Rs. 125 lakhs which willbe used for existing operations. The company has taken term loan of Rs. 150 lakhs from UTI Bank Limited for purchasingland & building and the balance Rs. 150 lakhs was contributed by promoters.

“Bluplast” Brand

Since Bluplast is an established brand in Indian as well as in the export market, the Company proposes to introduce thevalue added PVC Wood products under the Bluplast brand. This brand was earlier owned by Bluplast Corporation, a promotergroup entity. Bluplast Corporation has on April 20, 2006 unconditionally transferred the brand in the name of Company fora total consideration of Rs. 150 lakhs.

Purchase of Property

Except as stated in section titled “Objects of the Issue” in this Prospectus, on page 19 there is no property which the Companyhas purchased or acquired or propose to purchase or acquire which is to be paid for wholly, or in part, from the net proceedsof the Issue or the purchase or acquisition of which has not been completed on the date of this Prospectus, other thanproperty in respect of which: -

a) The contracts for the purchase or acquisition were entered into in the ordinary course of the business, and thecontracts were not entered into in contemplation of the Issue nor is the Issue contemplated in consequence of thecontracts; or

b) The amount of the purchase money is not material; or

c) Disclosure has been made in this Prospectus

Except as stated in the section titled “Related Party Transactions” on page 65 of this Prospectus, the Company has notpurchased any property in which any Directors, have any direct or indirect interest in any payment made thereof.

INFRASTRUCTURE

Power

The company is having total sanctioned load of 500 KVA from the transformer of 500 KVA out of which the company hasreceived a release order of 200 KVA from Electricity Board, Daman. It also propose to acquire 500 KVA Capacity of DG setsas standby arrangement.

Water

The water requirement is mainly for cooling, drinking and sanitary purposes. Its total requirement is 10000 litres per day,which is fulfilled from tubewell and connection from Public Works Department Daman. The Company has a boring well andtwo underground water tanks with the storage capacity of 10000 litres each as a standby arrangement.

Fuel

The company requires the fuel like, Diesel for Diesel Generating Sets, which is used as standby arrangement of power in thecompany, and the same is easily available in the near vicinity of the company.

Raw Materials

The main raw materials used by the company are Polyproplene (PP) Granules and Isocynate, Polyol. Both these raw materialsare indigenously available at the plant site as majority of the large manufacturers of these in the country have their distributiondepots/ units at Daman. The company has an option to procure these raw materials from overseas suppliers also.

Other raw materials used in the manufacturing plant are HDPE, Polycarbonate, ABS, Stainless Steel, Packing Materials,Stickers, Foils, Nuts, Adhesives, PP Belts etc. These are also easily available locally and company has not faced any problemsin the procurement of these. The Company buys the material in the spot market as per its production schedule so that thecompany’s inventory holding is optimized.

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Pollution Control and Effluent Treatment

The manufacturing process of the company does not generate any effluents. The company has obtained NOC from the StatePollution Control Board for the activities that will be carried out at its manufacturing facilities. The Company has obtained“NOC” from Pollution control Committee - Daman & Diu and Dadra & Nagar Haveli and the NOC is valid till December, 2006.

Exports

The products of the company have also been exported to the overseas markets like UK, Africa and Middle East. Around3-4% of the total turnover of the company has been from exports.

Export Obligation

Sr. EPCG License Date Details of Capital Nature of Amount of Period withinNo. No. Goods Purchased export Required Export Obligation which the

(Rs. In lakhs) (Rs. In lakhs) obligation hasto be fulfilled

1. 0330000 3/2/2000 123.62 Import Injection 741.75 F.Y. 2005-06104/3/12/00 Machinery

(Export obligation has been achieved in full as on March 31, 2006)

Capacity & Capacity Utilisation

Product 2003-2004 2004-2005 2005-06

Plastic Goods

Installed Capacity (MT) 4500 4500 5400

Actual Production (MT) 6741 5465 8379

% of Capacity Utilised 149% 121% 155%

Future Capacity & Capacity Utilisation of existing unit:

Product 2006-2007 2007-2008 2008-2009

Plastic Goods




Future Capacity & Capacity Utilisation of proposed unit:

Product 2006-2007 2007-2008 2008-2009

PVC Wood Composite




(Source: Project Appraisal)

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Insurance Coverage

PROPERTY:

Particulars Policy No. Valid from Valid To Amount

Factory Building & Stocks 171800/2006/170 23/05/2005 22/05/2006 9,09,00,000

Factory Building & Stocks (Alk) 020400/11/05/01011 27/11/2005 26/11/2006 1,07,00,000

Gaziabad Depot Stock 171800/2006/526 12/09/2005 11/09/2006 42,66,700

VEHICLE:


Vehicle – Nexia 020400/31/05/02446 08/11/2005 07/11/2006 1,70,000

Vehicle – Accent 020400/31/06/01/00000062 05/04/2006 04/04/2007 3,00,000

Vehicle – Santro- Real Earth VP00205078000100 29/12/2005 28/12/2006 3,32,452

Vehicle – Santro-Black VP00205066000100 29/12/2005 28/12/2006 3,29,029

Vehicle – Ford 0150042948 00 24/01/2006 23/01/2007 6,13,848

Vehicle – Omni 020400/31/05/01/00003695 23/01/2006 22/01/2007 2,28,392

KEY MAN:


Keyman Policy – KL 902406881 11-08-2004 20/11/2018 50,00,000

Keyman Policy – KL 902406882 11-08-2004 10/12/2018 50,00,000

Keyman Policy – IP 902406876 11-08-2004 20/11/2018 50,00,000

Keyman Policy – IP 902406877 11-08-2004 10/12/2018 50,00,000

Man Power

The present strength of the Company as on March 31, 2006 is 158 employees on the roll of the Company. and remaining44 employees are on contract and consultancy basis.

The Details are as under:

Sr. No. Department Skilled Employees Unskilled Employees Total

1 Production Department 84 33 117

2 Purchase Department 1 8 9

3 Marketing Department 3 11 14

4 Export Department 1 1 2

5 Finance & Accounts Department, HR 5 7 12

6 Secreterial Department 1 1 2

7 EDP Department 2 - 2

8 Contract Labours 36 - 36

9 Consultant & Others 8 - 8

TOTAL 126 76 202

ISO 9001:2000 Certified Company – The Company has received the certificate from UKAS Quality Management, AnAccreditation Body, dated November 17, 2005 and became ISO 9001:2000 certified company from that date.

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Marketing Strategy

� The company plans brand building through media advertising towards new product extension of PVC wood Compositeand creation of market awareness.

� The Company plans to have conferences, seminars for the prospective distributors, dealers and the concernedparties like major furniture manufacturers, architects, contractors, interior decorator, fabricators, to introduce theproducts with samples, models and to explain the features of the product. The various alternative products availablein the market will be compared along such important parameters such as cost, application durability etc.

� Direct selling campaign will be undertaken by the marketing team of the company. The company plans to establisha experienced, skilled and qualified sales team to achieve its objective through

a) Direct Mailing System through well known data-base providers.

b) Direct approaching to all leading architects, interiors and builders.

c) Direct approaching to all industrial houses.

� The company will use P.O.P materials like brochures, product catalogues, danglers, CD presentation fordealers, distributors, agents etc.

� The Company plans to leverage its existing 98 distributors and existing dealer network throughout the countryfor promotion of PVC wood composite products. Due to its inherent properties of PVC wood which can beused in coastal and humid regions, the company intends to appoint Distributors first in the Western andSouthern regions in the initial stage and then progress to Eastern and Northern regions.

In order to generate export sales, the company had entered into a Memorandum of Understanding (MOU) with Tung TaiMachine Work Co. Ltd of Taiwan for buy back of the products manufactured by the company.

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REGULATIONS AND POLICIES IN INDIA

Over the past five years, the Indian Government has removed many of the barriers hindering the sectors growth. But to fulfilthe potential of the country’s plastic-export industry, the Industry has been making representations to the government tomake way for further liberalisation so as to enable the players in the Industry to improvise on the lack of scale and pooroperational and organisational performance of local manufacturers and also invite investment, particularly foreign directinvestment.

Liberalization of FDI Policy:

Government has allowed foreign equity participation up to 100%, through automatic route, in the plastic sector with the onlyexception being that if the proposal involves import of items , which are either hazardous, banned or detrimental toenvironment (e.g. import of plastic scrap or recycled plastics), for which the Foreign Investment Promotion Board permissionmay be required.

Export Promotion Capital Goods (EPCG) Scheme:

The scheme facilitates import of capital goods at 5% concessional rate of duty with appropriate export obligation.

Duty Exemption Pass Book (DEPB) Scheme:

DEPB credit rates have been prescribed for plastic and plastic products.

Duty Drawback Scheme:

The exporters are allowed refund of the excise and import duty suffered on raw materials under the scheme so as to makethe products more competitive in the international market.

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HISTORY AND CERTAIN CORPORATE MATTERS

History

Two of the promoters of the Company Mr. Kamlesh L. Jain and Mr. Indermal P. Jain, have been associated with the plasticindustry for more than two decades. They started business in plastic product by incorporating Bluplast Corporation in 1985.Subsequently, the promoters expanded business by setting up facility in Daman under Alaska Industries, a group entity.They later started Thermoplast Industries Private Limited in 1999 with a unit in Daman with an initial capacity of 1940 MTPA,which has, over a period of time, been increased up to 4500 MTPA. Thermoplast Industries Private Limited later renamed asBluplast Industries Private Limited after acquiring total manufacturing unit of Alaska Industries on July 1, 2005, becameBluplast Industries Ltd with effect from July 14, 2005. The Company has been operating at 100% capacity utilization for thepast three years. In the FY 2004-05, to meet the demands of its products, the Company had to outsource the work ofmanufacturing its products to sub-contractors on job work basis and as a result of which the Company manufactured 5465MTPA against an installed capacity of 4500 MTPA.

Milestones

Date Particulars

January 14, 1999 Incorporation of the Company as “Thermoplast Industries Private Limited”

April 1, 2000 Company has acquired the license to use the Brand “Bluplast”.

May, 2000 Commencement of commercial production at its unit at Daman

March 11, 2005 Change of name to “Bluplast Industries Private Limited”

July 1, 2005 Company has acquired the exclusive licence of Bluplast Brand.

July 1, 2005 Company has acquired the business and assets of Alaska Industries which has an installedcapacity of 1800 MTPA

July 14, 2005 Conversion into a Public Limited Company as “Bluplast Industries Limited”

November 17, 2005 Company has become ISO 9001:2000 Certified Company.

December 10, 2005 Company has acquired a Corporate Office at 128, Udyog Bhawan, Sonawala Road, Mumbai– 400 063.

April 20, 2006 Company has acquired “Bluplast” brand in its own name.

Our Main Objects

The main objects as contained in our Memorandum of Association are:

To carry on business of manufacturing, Traders, processing, extrusioning, moulding, colouring, dipping, assembling, exporting,importing, buying, selling, dealing, as agents, distributors and dealers in plastic materials, articles, plastic home appliancesgoods, products, substances, appliance, apparels, containers, packing and plastic pen materials, toys, bottles, foot wears,furniture, pipe and fittings, bangles, storage tanks made from plastic, plastic materials, resins, rubber, materials includingpolyethylene, cellulose, acetate moulding powder, polystyrene, PET polyvinyl chloride polycarbonate, polystyrene, PETpolyvinyl chloride polycarbonate, polypropylene and copolymer epoxy resins composites, thermosetting, materials, polyol,isocynate of from other materials or combination of the same and to be used by consumers, industrial, household, government,commercial railway or for defence need and purposes.

To carry on the business of manufacturing, processing, assembling, exporting, importing, buying, selling, dealing as agent,distributors and dealers in Plastic Thermo ware Articles and Vacuum Flasks to be used by consumers, industrial Governmentfor commercial and household purpose.

To carry on the business of manufacturer, trader, dealer, exporter, importer, broker, commission agent of wood, plastic andwood composite profile, door frame, window frame, wall board, floor board, sheets, decorative strips made of plastic andwood composite, or wood or any other articles in the manufacture of which wood or plastic plus wood composite is used,including furniture and interior decoration which may seem to the Company capable of being conveniently carried on inconnection with any of the above whether directly or indirectly to render profitable or to enhance the value of the Company’sproperty of right for the time being.

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The main objects clause and the objects incidental or ancillary to the main objects of our Memorandum of Association enableus to undertake our existing activities and the activities for which the funds are being raised through this Issue.

Changes in the Memorandum of Association

Since incorporation of our Company, the following changes have been made in the Memorandum of Association:

Amendment Date of Amendment

Increase in the Authorised Capital from Rs.25,00,000/- to Rs.1,75,00,000/- October 4, 1999divided into 17,50,000 equity shares of Rs.10/- each.

Clause 2A inserted in the MOA.AOA amended by inserting a new clause (4) February 7, 2005in Article No.3 to read as: “(4). Prohibits any invitation or acceptance of depositsfrom persons other than its members, directors and their relatives.”

Increase in the Authorised Capital from Rs.1,75,00,000/- to Rs.5,00,00,000/- February 7, 2005divided into 50,00,000 equity shares of Rs.10/- each.

Name of the Company changed from Thermoplast Industries Private Limited to March 11, 2005Bluplast Industries Private Limited.

Adoption of new set of Articles of Association for conversion of Company from May 25, 2005private to public limited

Name of the Company changed from Bluplast Industries Private Limited to July 14, 2005Bluplast Industries Limited.

Increase in the Authorised Capital from Rs.5,00,00,000/- to Rs.10,00,00,000/- July 25, 2005divided into 1,00,00,000 equity shares of Rs.10/- each.

Adoption of New set of AOA to comply to requisite requirements for Listed Company. September 12, 2005

Increase in the Authorised Capital from Rs.10,00,00,000/- to Rs.20,00,00,000/- September 12, 2005divided into 2,00,00,000 equity shares of Rs.10/- each.

Subsidiaries of the Company

The Company does not have any subsidiary.

Shareholders Agreements

The Company has not entered into any shareholders agreements.

Strategic Partners

At present, the Company does not have any strategic partners.

Financial Partners

At present, the Company does not have any financial partners.

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MANAGEMENT

Board of Directors

Under our Articles of Association, the Company cannot have less than three (3) and more than twelve (12) directors. Thecompany currently have six (6) Directors.

The following table sets forth current details regarding our Board of Directors:

Name, Designation, Father’s Age Date of Appointment Other DirectorshipsName, Address, Occupation and Term

Mr. Kamlesh Lalchand Jain 46 yrs. 27th February, 1999 M/s. Bluplast Moulders Pvt. Ltd.Managing Director Appointed as additionalS/o. late Mr. Lalchand Jain, director102, Indrapuri, S. V. Road, 12th September, 2005Goregaon (W), Mumbai - 400 062 Appointed as ManagingBusiness Director w.e.f.

2nd September, 2005

Mr. Indermal P. Jain 43 yrs. Appointed as first directorJoint Managing Director in terms of clause noS/o. Mr. Pannalal Jain 168 of Articles of Association402, Evershine AanganS.V. Road, Goregaon (W), 12th September, 2005 M/s. Bluplast Moulders Pvt. Ltd.Mumbai - 400062 Appointed as JointBusiness Managing Director

w.e.f. 2nd September, 2005

Mr. Prince Jain 30 yrs. 10th August, 2005 NILDirector Liable to retire by rotationS/o. Mr. Hirachand Jain1804 18th Floor, Gurukul TowerJaywant Sawant Road,Dahisar-West,Mumbai – 400 068Business

Mr. Rajendra D Jain 43 yrs 10th August, 2005 NILDirector Liable to retire by rotationS/o Mr. Dwarka Prasad Jain305 Manish ChambersSonawala Road, Goregaon-East,Mumbai 400063Business

Mr. Janakraj Vakil 45 yrs. 10th August, 2005 NILDirector Liable to retire byS/o. Mr. Ramnik Lal Vakil rotation58, Jawahar Nagar,Near Jain Mandir,Goregaon (West),Mumbai-400 062.Service

Mr. Arvind M. Mehta 60 yrs. 6th October, 2005 1) M/s. Welset Plast Extrusions (P) LtdDirector Liable to retire byS/o. Mr. Mathuradas Mehta rotation 2) M/s. Welset Med Plast Pvt. Ltd.5, Neet Deep, 12 Bajaj Road,Vile Parle (West), Mumbai 400060Service

53


Details of Directors (brief profile)

For the brief profile of Promoter Directors viz. Mr. Kamlesh Lalchand Jain and Mr. Indermal P. Jain, see section titled “Promoters”on page no. 59 of the Prospectus.

Mr. Prince H. Jain, Director:

Mr. Prince H. Jain is 30 years old. He is a Commerce graduate from Bombay University. He is having Diploma in Sales &Marketing Management from National Institute of Sales, Mumbai. He is associated with various companies from the age of18. He started his career as a Sales representative of TTK Prestige Ltd. and then joined Gillette India Limited in the capacityof Territory Sales Incharge. Before joining Bluplast Industries Limited in the year 2002 he was owning the distributionshipbusiness of FMCG (Food products) of Radiance Marketing.

Mr. Arvind M. Mehta, Independent Director:

Mr. Arvind M. Mehta is 60 years old. He is a Science graduate from Mumbai University. He is Managing Director of M/s.Welset Plast Extrusions (P) Ltd., Mumbai. He has been in Plastics industry for nearly 37 years. He was President of TheBombay Fountain Pen Manufacturers & Traders Association for three years. He was President of SPE-USA (Indian Section).He was also President of The All India Plastics Manufacturers Association for three years, which were marked with manylandmark events. At present he is Vice President of Plastindia Foundation. He has represented Plastic Industry in CII NationalExecutive Council Member as duly elected for two consecutive years.

Mr. Janakraj R. Vakil, Independent Director:

Mr. Janakraj R. Vakil is 45 years old. He is an Art graduate from Mumbai University. He completed his L.L.B from Govt. LawCollege, Mumbai and is enrolled with BAR council of Maharashtra. He is having more than 20 years experience in legalmatters. He is also the member of Goregaon Education Society.

Mr. R. D. Jain, Independent Director:

Mr. R. D. Jain is 43 years old. He is a Commerce graduate from Bombay University and the Fellow member of Institute ofChartered Accountants of India. He has a experience in accounting and taxation and is practicing as a Chartered Accountantfor the last 17 years.

Borrowing Powers of the Board

In respect of borrowing powers, Article 96 of the Company’s Articles of Association provides “Subject to the provisions ofSection 58A, 292 and 293 of the Act and of the Companies (Acceptance of Deposits) Rules, 1975 and of these Articles orany statutory modification thereof for the time being in force the Board may, from time to time at its discretion by a resolutionpassed at a meeting of the Board, accept deposits from Members either in advance of calls or otherwise and generally raiseor borrow or secure the payment of any sum or sums of money for the purpose of the Company. Provided however wherethe moneys to be borrowed together with the moneys already borrowed (apart from temporary loans to be obtained from theCompany’s bankers in the ordinary course of business) exceed the aggregate of the paid up capital of the Company and its,free reserves (not being reserves set apart for any specific purpose) the Board of Directors shall not borrow such moneywithout the sanction of the Company in General Meeting.” See section titled “Main Provisions of the Articles of Association”on page no. 119 of the Prospectus.

The shareholders of the Company at the EGM held on October 4, 1999 authorised the Board to borrow maximum of Rs.5000 Lakhs.

Compensation of the Directors

Mr. Kamlesh Lalchand Jain: Mr. Kamlesh L. Jain was appointed as director of the Company on 27th February, 1999. He wasappointed as Managing Director w.e.f. 2nd September, 2005 for the term of 5 year in the EGM held on 12th September, 2005.His compensation is as follows:

Salary of Rs.60,000/- to Rs.1,20,000/- per month

Performance linked bonus equivalent to a minimum two months salary to be paid annually.

54


Perquisites like house rent allowance, or accommodation, medical expenses, medical/ accident insurance to the tune ofRs.3,60,000/- per annum with the authority to Board to increase it upto a maximum of Rs.7,20,000/- per annum and leavewith full pay and allowance as per the Company’s rules. Provident Fund, Superannuation, Leave Travel Allowance andother statutory allowances.

Mr. Indermal P. Jain: Mr. Indermal P. Jain was appointed as the first director of the Company. He was appointed as WholetimeDirector w.e.f. September 2, 2005 for the term of 5 year in the EGM held on September 12, 2005. His compensation is asfollows:

Salary of Rs.60,000/- per month to Rs. 1,20,000/- per month

Performance linked bonus equivalent to a minimum two months salary to be paid annually.

Perquisites like house rent allowance, or accommodation, medical expenses, medical/ accident insurance to the tune ofRs.3,60,000/- per annum with the authority to Board to increase it upto a maximum of Rs.7,20,000/- per annum and leavewith full pay and allowance as per the Company’s rules.

Provident Fund, Superannuation, Leave Travel Allowance and other statutory allowances.

Commission to Part – time Directors:

The shareholders of the Company in its meeting held on August 26, 2005 has authorised the Board to pay remuneration tothe directors by way of commission not exceeding the limit of 1% or 3 %, as the case may be, of the net profit as per section349 and 350 of the Companies Act, 1956. As of now the Company has not given any remuneration to any part-time directors.

Corporate Governance

The provisions of the listing agreement to be entered in to with the stock exchanges with respect to corporate governancewill be applicable to the Company immediately upon listing of our Company’s equity shares on the stock exchanges. TheCompany has already initiated steps to comply with the requirements of Corporate Governance guidelines issued by SEBI.

The Board of Directors of the Company comprises of six (6) directors, of which two are executive directors and four are non-executive directors out of which three are Independent directors. The Company has also constituted the various committeesviz. Audit Committee and Share Transfer & Investor Grievance Committee.

Further, the Company undertakes to comply with all the other requirements of the SEBI Guidelines on Corporate Governanceas may be applicable to the Company upon listing of its equity shares.

Committees of the Board:

Audit Committee

Audit committee was constituted on September 12, 2005 with three members:

Mr. R. D. Jain - Chairman & Member

Mr. Janakraj R.Vakil - Member

Mr. Prince H. Jain - Member

The General objective of the Audit Committee is to establish a transparent and effective system of monitoring and control, toreview annual plan of our Company, and any special examination by internal audit and implementation of internal auditrecommendations, to review quarterly, half early and annual financial statement before submission to the board and to conductlimited review, together with coverage of scope of activity prescribed under section 292 A of Companies Act, 1956. The auditcommittee also considers and reviews ethical adherence and corporate governance principles.

Share/Debenture Transfer & Investors’ Grievance Committee

Share/Debenture Transfer & Investors’ Grievance Committee was constituted on October 6, 2005 with three members:

Mr. R. D. Jain - Chairman

Mr. Kamlesh Jain - Member

Mr. Indermal Jain - Member

55


The scope and function of this committee is to consider and review shareholders’ / investors’ grievances and complaints andto ensure that all shareholders’ / investors’ grievances and correspondence are attended to expeditiously and satisfactorilyunless constrained by incomplete documentation and / or legal impediments.

Shareholding of the Directors in the Company

The present shareholding of Directors is detailed below:

Name of the Director Designation No. of Shares held % of pre issue paid-upshare capital

Mr. Kamlesh L. Jain Managing Director 33,91,324 43.95

Mr. Indermal P. Jain Whole – time Director 29,63,920 38.41

Mr. Prince Jain Director Nil Nil

Mr. R. D. Jain Director Nil Nil

Mr. Janakraj R. Vakil Director Nil Nil

Mr. Arvind M. Mehta Director Nil Nil

Interest of Promoters / Directors

All Directors of the Company may be deemed to be interested to the extent of fees, if any, payable to them for attendingmeetings of the Board or a Committee thereof as well as to the extent of other remuneration, commission, reimbursement ofexpenses payable to them under the Articles of Association of the Company. All our Directors may also be deemed to beinterested to the extent of Equity Shares, if any, already held by them or their relatives in our Company or that may besubscribed for and allotted to them, out of present issue in terms of the Prospectus and also to the extent of any dividendpayable to them and other distributions in respect of the said Equity Shares.

The Directors may also be regarded as interested in the Equity Shares, if any, held by or that may be subscribed by andallotted to the Companies, firms and trust, in which they are interested as Directors, members, partners or trustees.

The Company has acquired all the assets and liabilities of Alaska Industries, one of the Promoter Group entity on July 1,2005 on a slump-sale basis for a total consideration of Rs. 300 lakhs.

Further, the Company has entered into an agreement with Bluplast Corporation, whereby Bluplast Corporation has agreedto assign and unconditionally transfer brand “Bluplast” in the name of Company for a total consideration of Rs. 150 lakhs.

Changes in our Board of Directors during the last three years

Name Date of Appointment Date of Cessation Reasons

Mrs. Nayana Jain First director October 6, 2005 Resigned from directorship of the Company

Mrs. Rekha Jain First director October 6, 2005 Resigned from directorship of the Company

Mr. Prince H. Jain August 10, 2005 - Appointed as a director

Mr. Janakraj Vakil August 10, 2005 - Appointed as a director

Mr. R. D. Jain August 10, 2005 - Appointed as a director

Mr. Arvind M. Mehta October 6,2005 - Appointed as a director in the casualvacancy of Mrs.Rekha Jain.

56

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57


Key Managerial Personnel

The details of the key managerial personnel of the Company are as follows:

Name Date of Age Experience Designation Qualification PreviousJoining (in yrs.) (in yrs.) Employment

Mr. Vilas J. Dhumal 01.06.2005 41 15 General Manager- B.Sc,(Tech), Diploma M/s Eagle Flasks Ind.Works (Plant) in Plastic Engg., Ltd., M/s Prince Plastics

PGDMM/MBA, Plastic Ltd., M/s TimeMould Designing, Packaging LimitedMPM (admin),Labour law,Diploma inProduction Engg.

Mr. Shashinand 14.05.2001 33 7 Manager-Accounts, B.Com., A.C.A. M/s Rivona IndustriesNagori Finance & HR Ltd.

Mr. Satish Kumar 16.01.2006 26 2 Company Secretary B.Com, ACS GE Motors India Pvt.Shrivastava Ltd.

Mr. Vasant H Purohit 01.06.2001 35 11 Manager- B.Com. -Administration (Plant)

Mr. Mustan Boxwalla 01.04.2001 36 8 Manager-Purchase B.Com., Diploma in Max Rent-A-CarComputer Art,Diploma in GeneralTravel knowledge

Mr. Unmesh Karnik 01.07.2005 37 5 Manager-EDP B.Sc., Diploma in -Computer Programming

Mr. Jitendra Solanki 01.04.2002 33 8 Manager-Exports B.Com., Diploma in Simrone Phrama-euticalImport Export Ltd., BhagyalaxmiManagement Industries and Besto

Industries.

Mr. Omprakash Dave 01.07.2005 48 20 Manager-Sales Under Graduate in M/s NavalmalCommerce Stream Gulabchand Suiting

(Distributors of GwaliorSuiting)

All the key managerial personnel are permanent employees of the Company.

Brief Profile of the Key Managerial Personnel

Mr. Vilas J. Dhumal:

Mr. Vilas J. Dhumal, aged 41 years is a B. Sc. (Tech) graduate from Pune. He has also done Diploma in Plastic Engg., PGDMMand Diploma in Production Engg. He joined the Company on June 1, 2005. He has experience in plastic industry for the last15 years. He is presently working as General Manager-Works (Plant) and is overall in-charge of existing plant. His remunerationis Rs. 1,92,000 per annum.

Mr. Shashinand Nagori:

Mr. Shashinand Nagori aged 33 years, is a Commerce graduate from Ajmer University and is a Chartered Accountant. Hejoined the Company on May 14, 2001. He is presently working as Manager-Accounts, Finance & HR. His previous employmentwas with M/s Rivona Industries Ltd. He has more than 7 years of experience in accounting and financial works. Hisremuneration is Rs. 2,04,000 per annum.

Mr. Satish Kumar Srivastava:

Mr. Satish Kumar Srivastava aged 26 years, is a Commerce graduate. He is an Associate Member of Institute of CompanySecretaries of India. He joined the Company on January 16, 2006. He is presently working as Company Secretary.

58


Mr. Vasant H Purohit:

Mr. Vasant H Purohit, aged 36 years, is a Commerce graduate. He joined the Company on June 1, 2001. He is presentlyworking as Manager-Administration (Plant). He has been associated with the group Company for the last 11 year and gainedexperience in administration and coordination. His remuneration is Rs. 84,000 per annum.

Mr. Mustan Boxwalla:

Mr. Mustan Boxwalla, aged 37 years, is a Commerce graduate from Mumbai University. He has a Diploma in Computer Art,Diploma in General Travel knowledge. He joined the Company on April 1, 2001 He is presently working as Manager-Purchase.His previous employment was with Max Rent-A-Car. He has more than 5 years of experience in designing. His remunerationis Rs. 1,11,000 per annum.

Mr. Unmesh Karnik:

Mr. Unmesh Karnik, aged 38 years, a Science graduate from Mumbai University and has a Diploma in Computer Programming.He joined the Company on July 1, 2005. He is presently working as Manager-EDP. He has experience of more than 5 years.His remuneration is Rs. 1,32,000 per annum.

Mr. Omprakash Dave:

Mr. Omprakash Dave aged 48 years, is Under Graduate in Commerce Stream. He had joined bluplast group of companiesin June 1986 as Sales Executive and has been now promoted as Manager-Sales in April, 2006. He has more than 20 yearsof experience in marketing in the plastic industry. His previous employment was with M/s Navalmal Gulabchand Suiting(Distributors of Gwalior Suiting). His remuneration is Rs. 1,56,000 per annum.

Mr. Jitendra Solanki:

Mr. Jitendra Solanki aged 34, is a Commerce graduate from Mumbai University He joined the Company on April 1, 2002. Hehas a Diploma in Import-Export Management. He is presently working as Manager-Exports. His previous employments werewith Simrone Pharmaceutical Ind. Ltd., Bhagyalaxmi Industries and Besto Industries. His remuneration is Rs. 90,000 perannum.

None of the Key Managerial Personnel are related to each other. The Key Managerial Personnel do not hold any shares inthe Company.

Bonus and/or profit sharing plan for Key Managerial Personnel

The Company does not have any bonus and/or profit sharing plans for Key Managerial Personnel.

Employees Stock Option Scheme

The Company does not have any ESOP / ESOS.

Payment or Benefits to the Officers of the Company (non-salary related)

The Company has not offered any non-salary related payment or benefits to the Officers of the Company.

Changes in Key Managerial Personnel during last three years

Name Date of Appointment Date of Cessation Reasons

Mr. Nitin Shrivastava 1st September, 2005 - Appointed as the Company Secretary

Mr. Vilas J. Dhumal 1st June, 2005 - Appointed as GM, Works (Plant)

Mr. Umesh Karnik 1st July, 2005 - Appointed as EDP Manager

Mr. Nitin Shrivastava January 14, 2006 Resignation

Mr. Satish Srivastava January 16, 2006 Appointed as Company Secretary

Mr. Om Prakash Dave July 1, 2005 Appointed as Asstt. Manager – Sales(Now got promotion w.e.f. April 1, 2006)

59


PROMOTERS

Mr. Kamlesh Jain, aged 46 years, is the Managing Director of the Company. He is one of thepromoter, originally hails from Rajasthan. He has about 20 years of experience in Plastic Industry.In the year 1978 he joined the Cello Group and gained experience in household plastic items.In the year 1985 he set up his own plastic household thermoware facilities under the firm nameBluplast Corporation He has been associated with the Company since inception and has beentaking part in all the activities of the Company. He supervised the launchinhg of new productsintroduced by the company from time to time.

Voter ID : MT / 09 / - 042 / 549295

Driving License number : MH/02/91/22937

Mr. Indermal Jain is younger brother of Shri Kamlesh Jain aged 43 years. He is a whole timedirector of the Company designated as Joint Managing Director. He joined Bluplast Corporationas a partner and gained considerable experience in plastic items. He was also one of thepromoters of Thermoplast Industries Pvt. Ltd, which is currently known as Bluplast IndustriesLimited. He is involved in looking after the designing concepts of the plastic products for theCompany.

Voter ID : MT/09 – 042/066681

Driving License number : A – 9277

Mrs. Rekha Jain, aged 42 years is presently a Partner in Bluplast Corporation and handles thetrading activities and export business of the firm. She has been actively involved in theadministration and co-ordination work within the Company.

Voter ID : MT/09/042/54922

Driving License number : MH-02-96-102

Mrs. Nayana Jain aged 42 years is presently a partner in Bluplast Corporation. She has beenactively involved in the administration and co-ordination work within the Company.

Voter ID : MT/09/042/ 066680

Driving License number : 29576

It is hereby confirmed that the permanent account number, bank account number and passport number wherever availableof all the above Promoters were submitted to the Stock Exchanges at the time of filing the Prospectus with the StockExchanges.

Mr. Indermal Jain

Mr. Kamlesh L. Jain

Mrs. Rekha Jain

Mrs. Nayana Jain

60


INFORMATION OF THE PROMOTER GROUP COMPANIES

Bluplast Moulders Private Limited

Date of Incorporation 13/08/1997Nature of Activities Manufacturer of Plastic House Hold Articles

Financial Performance Year ended Year ended Year ended(Rs. in lakhs except per share data) March 31, 2005 March 31, 2004 March 31, 2003

Equity Share Capital(Face Value of Rs. 100/- per equity share) 1.00 1.00 1.00Reserves (excluding revaluation reserves) 9.11 9.40 10.28Sales 0.00 1.50 0.00Profit After Tax (0.30) (0.87) (0.82)E.P.S. (Rs.) N.A N.A N.AN.A.V. (Rs.) 1011.00 1040.00 1128.00

Subsidiary

Bluplast Moulders Private Limited does not have any subsidiaries.

Shareholding Pattern of Bluplast Moulders Pvt. Ltd.

Sr. No. Name of Members No. of Shares Percentage of share holding

1. Mr. Kamlesh L. Jain 275 27.5%2. Mr. Indremal P. Jain 275 27.5%3. Mrs. Rekha K. Jain 150 15%4. Mrs. Nayana I. Jain 150 15%5. Mr. Pannalal Jain 150 15%

The shares of Bluplast Moulders Pvt. Ltd. are not listed on any Stock Exchange. Bluplast Moulders Pvt. Ltd. has not becomesick Company within the meaning of the Sick Industrial Companies (Special Provisions) Act, 1995 nor is under winding up.The company is in the process of winding up its operations as not being operative.

Bluplast Corporation

Bluplast Corporation, a partnership concern, having its principal office at 113, Vivek Industrial Estate, Uswala Road, NearLitolier, Cama Estate, Goregaon (E), Mumbai - 400063 was formed in 1985 with the object of undertaking contractmanufacturing and trading of plastic products.

As on March 31, 2006, the concern has following partners:

S. No. Name of the Partner Interest (%)

1. Mr. Kamlesh L. Jain 192. Mr. Indermal P. Jain 193. Mrs. Rekha K. Jain 194. Mrs. Nayana I. Jain 195. Mr. Pannalal Jain 24

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Financial Performance of the concern in the last three years

(Rs. In Lakhs)

Particulars Year ended Year ended Year endedMarch 31, 2005 March 31, 2004 March 31, 2003

Income / Turnover 1.52 1.02 7.27Profit Before Tax 0.75 (0.12) 0.06Partner’s capitalMr. Kamlesh L. Jain 5.11 5.02 3.30Mr. Indermal P. Jain 2.70 2.58 0.81Mrs. Rekha K. Jain 0.29 0.23 1.23Mrs. Nayana I. Jain 8.44 6.79 3.95Mr. Pannalal Jain 2.79 2.70 2.67

Alaska Industries

Alaska Industries, a partnership concern, having its principal office at 113, Vivek Industrial Estate, Uswala Rd., Near Litolier,Cama Estate, Goregaon (E), Mumbai - 400063 was formed in 1994 with the object of carrying on the activity of manufacturingand trading of plastic products. It has an installed capacity of 1800 MTPA in Daman and manufactures insulated thermowareitems such as Casseroles, Water Jugs & non- thermoware items meant for household & domestic consumption.



1. Mr. Kamlesh Jain 502. Mr. Indermal Jain 50


(Rs. In Lakhs)


Income / Turnover 1546.86 1573.63 1269.44Profit Before Tax 14.58 9.35 6.72Partner’s capitalMr. Kamlesh L. Jain 68.09 70.97 59.54Mr. Indermal P. Jain 65.40 76.90 76.20

Bluplast Utility Products

Bluplast Utility Products, a partnership concern, having its principal office at 113, Vivek Industrial Estate, Uswala Rd., NearLitolier, Cama Estate, Goregaon (E), Mumbai 400063 was formed in November 1999 with the object of business ofmanufacturing of plastic novelties and gift articles. Partners are in the process of dissolution of the firm as the firm beinginoperative.



1. Mr. Kamlesh Jain 502. Mr. Indermal Jain 50

62



(Rs. In Lakhs)


Income / Turnover 247.80 98.20 82.23Profit Before Tax 12.86 5.59 15.04Partner’s capitalMr. Kamlesh Jain 19.85 11.00 8.21Mr. Indermal Jain 2.53 13.42 10.63

Bluplast Industries

Bluplast Industries, a partnership concern, having its principal office at 113, Vivek Industrial Estate, Uswala Road, NearLitolier, Cama Estate, Goregaon (E), Mumbai 400063 was formed in April 2000 with the object of business of manufacturingof plastic novelties and gift articles. Partners are in the process of dissolution of the firm as the firm being inoperative.



1. Mr. Kamlesh L. Jain 472. Mr. Indermal P. Jain 473. Mrs. Rekha K. Jain 34. Mrs. Nayana I. Jain 3


(Rs. In Lakhs)


Income / Turnover 6.03 23.67 21.93Profit Before Tax 0.30 0.00 0.09Partner’s capitalMr. Kamlesh L. Jain 13.70 15.85 23.37Mr. Indermal P. Jain 16.84 16.70 24.21Mrs. Rekha K. Jain (2.13) (2.14) (2.18)Mrs. Nayana I. Jain (2.15) (2.16) (2.20)

Bluplast Pentech

Bluplast Pentech, a partnership concern, having its principal office at 113, Vivek Industrial Estate, Uswala Road, Near Litolier,Cama Estate, Goregaon (E), Mumbai - 400063 was formed in November 1999 with the object of business of manufacturingof plastic novelties and gift articles. Partners are in the process of dissolution of the firm as the firm being inoperative.



1 Mr. Kamlesh Jain 502 Mr. Indermal Jain 50

63



(Rs. In Lakhs)


Income / Turnover 176.87 9.50 4.68Profit Before Tax 8.78 0.80 0.00Partner’s capitalMr. Kamlesh Jain 4.84 1.06 0.67Mr. Indermal Jain 10.51 6.11 5.72

Neelam Plastics Industries

Neelam Plastics Industries, a partnership concern, having its principal office at 113, Vivek Industrial Estate, Uswala Road,Near Litolier, Cama Estate, Goregaon (E), Mumbai - 400063 was formed in 1977 with the object of business of manufacturingof plastic novelties and gift articles. Partners are in the process of dissolution of the firm as the firm being inoperative.



1. Mr. Pannalal Jain 302. Mrs. Rekha K. Jain 353. Mrs. Nayana I. Jain 35


(Rs. In Lakhs)


Income / Turnover 0.00 1.08 1.08Profit Before Tax (1.05) 0.00 0.00Partner’s capitalMr. Pannalal Jain 1.02 1.33 1.04Mrs. Rekha K. Jain (0.38) (0.01) (0.01)Mrs. Nayana I. Jain 3.56 3.93 (0.12)

64


CURRENCY OF PRESENTATION

In this Prospectus, all references to “Rupees” ,”Indian Rupees” and “Rs.” are to the legal currency of India.

In this Prospectus, throughout all figures have been expressed in lakhs. The word “lakhs” or “Lakh” or “Lacs” means “Onehundred thousand”.

Any percentage amounts, as set forth in “Risk Factors”, “Our Business”, “Management’s Discussion and Analysis of FinancialConditions and Results of Operations” and elsewhere in this Prospectus, unless otherwise indicated, have been calculatedon the basis of our financial statements prepared in accordance with Indian GAAP.

65


RELATED PARTY TRANSACTION

Information on Related Party Disclosures as per AS-18.

1. For the period ended 31st March, 2006

(a) Key Management Pesonnel & Relatives

(Rs. In Lakhs)

Directors Unsecured Repayment Loans SharesRemuneration Loans Taken of Loans Taken Payable Allotment/

Application

Mr. Kamlesh L.Jain 4.95 1.75 2.13 0 176.49Mr. Indermal P.Jain 4.95 88.03 89.31 10.56 135.27Mr. Prince Jain 0 0 0 0 0Mr. R.D. Jain 0 0 0 0 0Mr. Arvind Mehta 0 0 0 0 0Mrs. Rekha K. Jain 0.60 2.60 0.75 0 67.58Mrs. Nayana I. Jain 0.60 0.60 0.75 0 69.60

Total 11.10 92.98 92.94 10.56 448.94

(b) Name of the enterprises having same Key Management Personnel and / or their relatives as the reporting enterprisewith whom the Company has entered into transactions during the year.

(Rs. In Lakhs)

Purchases Sales Unsecu- Repay- Loans Rent Job Interest Royalty Other Purch-red ment of Paya- paid Charges Paid Paid Receiv- ase of

Loans Loans ble Paid ables theTaken Taken under-

taking

Alaska Industries 122.86 0 0 0 0 0.30 3.87 0 0 0 300.00Bluplast Corporation 0 14.46 134.13 91.85 42.28 0 0 2.00 29.54 150.00 0Bluplast Industries 0 0 0 0 0 0 0 0 0 0 0Bluplast Pentechs 0.09 0 0 0 0 0 0 0 0 0 0Bluplast Utility Products 2.10 0 0 0 0 0 0 0 0 0 0Bluplast Moulders Pvt.Ltd. 0 0 0 0 0 0 0 0 0 0 0

Total 125.05 14.46 134.13 91.85 42.28 0.30 3.87 2.00 29.54 150.00 300.00

Note: Related Parties as disclosed by Management and relied upon by auditors

1. For the Previous year ended 31st March, 2005

(a) Key Management Pesonnel(Rs. In Lakhs)

Directors Repayment of Shares LoansRemuneration Loans Taken Allotment / Payable

Application

Mr. Kamlesh L.Jain 1.50 2.00 175.19 5.99

Mr. Indermal P.Jain 1.50 3.94 131.84 2.14

Mrs. Rekha K. Jain 1.50 0 0.01 1.20

Mrs. Nayana I. Jain 1.50 0 0.01 1.20

Total 6.00 5.94 307.05 10.53

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(b) Name of the enterprises having same Key Management Personnel and / or their relatives as the reportingenterprise with whom the Company has entered into transactions during the year.

(Rs. In Lakhs)

Purchases Sales Rent Paid Job Repayment Loans Deposits/ Shares Other

Charges of Loan Received Loans & Allotment / Recei-

Paid Taken Back Advance Application vables

Alaska Industries 225.53 119.86 1.20 19.93 0 0 75.00 0 75.00

Bluplast Corporation 0 0 0 0 0 0.80 100.80 0 100.80

Bluplast Industries 0 5.59 0 0 12.67 0 0 0 0

Bluplast Pentechs 0 0 0 0 0 1.88 0 0 0

Bluplast Utility Products 0 0 0 4.50 0.45 0 0 1.85 0

Bluplast Moulders Pvt.Ltd. 0 0 0 0 4.88 0 0 4.87 0

Total 225.53 125.45 1.20 24.43 18.00 2.68 175.80 6.72 175.80

Note: Related Parties as disclosed by Management and relied upon by auditors.

2. For the Previous year ended 31st March 2004

(a) Key Management Pesonnel

(Rs. In Lakhs)

Directors Unsecured Repayment of LoansRemuneration Loans Taken Loans Taken Payable

Mr. Kamlesh L.Jain 1.20 0 0 7.99


Mrs. Rekha K. Jain 1.20 0 0 1.20

Mrs. Nayana I. Jain 1.20 0 0 1.20

Total 4.80 1.10 0.14 16.47


(Rs. In Lakhs)

Purchases Sales Job Unsecu- Repayment Loan Sundry Loans Other

Charges red Loans of Loans Granted Creditors Payable Recei-

Paid Taken Taken vables

Alaska Industries 94.75 0 19.45 172.3 198.19 0 0.86 0 0

Bluplast Corporation 0 0.10 0 0 1.24 0.80 0 0 0.80

Bluplast Industries 0 0 0 0.09 0 0 5.56 12.67 0

Bluplast Pentechs 0 0 0 0 0 0 0 0 1.88

Bluplast Utility Products 0 0.12 5.40 0.45 0 0 8.81 0.45 0


Total 94.75 0.22 24.85 172.84 204.51 0.80 15.23 18.00 2.68


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(Rs. In Lakhs)

Directors Unsecured LoansRemuneration Loans Taken Payable

Mr. Kamlesh L.Jain 1.20 2.64 7.99

Mr. Indermal P.Jain 1.20 2.58 5.12

Mrs. Rekha K. Jain 1.20 0 1.20

Mrs. Nayana I. Jain 1.20 0 1.20

Total 4.80 5.22 15.51


(Rs. In Lakhs)

Sales Job Unsecu- Repayment Sundry Sundry Loans Other

Charges red Loans of Loans Debtors Creditors Payable Recei-


Alaska Industries 0 12.13 5.28 0 0 0.75 25.89 0

Bluplast Corporation 5.73 0 0 0 0 0 0 1.24

Bluplast Industries 0 0 8.25 0.10 0 5.56 12.58 0

Bluplast Pentechs 0 0 0 0 0 0 0 1.88

Bluplast Utility Products 19.62 3.56 0 0 0 3.41 0 0

Bluplast Moulders Pvt.Ltd. 0 0 0 0.10 5.08 0 9.96 0

Total 25.35 15.69 13.53 0.20 5.08 9.72 48.43 3.12




(Rs. In Lakhs)

Directors Unsecured Repayment of LoansRemuneration Loans Taken Loans Taken Payable

Mr. Kamlesh L.Jain 1.20 1.83 0.14 5.35

Mr. Indermal P.Jain 1.20 1.58 0 2.54

Mrs. Rekha K. Jain 1.20 1.20 0 1.20

Mrs. Nayana I. Jain 1.20 1.20 0 1.20

Total 4.80 5.81 0.14 10.29

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(Rs. In Lakhs)

Purchases Sales Job Unsecured Repayment Sundry Loans Other

Charges Loans of Loans Debtors Payable Receivables

Paid Taken Taken

Alaska Industries 108.31 0 10.25 35.38 21.6 0 20.61 0

Bluplast Corporation 0 0.75 0 1.65 24.7 0.75 0 1.00

Bluplast Industries 0 0 0 8.55 5.27 0 4.43 0

Bluplast Pentechs 0 0 0 0 0 0 0 0

Bluplast Utility Products 0 1.63 0 0 0 1.63 0 4.47


Total 108.31 2.38 10.25 47.35 55.92 2.38 35.1 5.47


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DIVIDEND POLICY

The declaration and payment of dividends will be recommended by the Board of Directors and approved by the shareholdersof the Company, at their discretion, and will depend on a number of factors, including but not limited to the profits, capitalrequirements and overall financial condition. The Board may also from time to time pay interim dividend.

The Summary of dividends declared by the Company during the last five financial years is as follows:-

F.Y. Ended March 31, March 31, March 31, March 31, *March 31,2002 2003 2004 2005 2006

Face value of Equity Share (Rs. Per share) 10 10 10 10 10

Dividend (Rs. In Lakhs) 7.12 8.68 13.01 18.68 63.76

Dividend Tax (Rs. In Lakhs) - 1.11 1.70 2.62 8.94

Dividend per equity share (Rs.) 0.50 0.50 0.75 1.00 1.00

Dividend Rate (%) 5% 5% 7.5% 10% 10%

* yet to be approved by Shareholders in the forthcoming Annual General Meeting

70


FINANCIAL INFORMATION

Auditors’ Report

The Board of Directors,Bluplast Industries Limited,(Formerly known as Thermoplast Industries Private Limited),113/114 Vivek Industrial Estate, Near Litolier,Uswala Road, Cama Estate,Goregaon (E), Mumbai - 400063.

A. a) We have examined the annexed financial information of Bluplast Industries Limited (Formerly known asThermoplast Industries Private Limited), (“the Company”) for the five financial years ended March 31, 2002,2003, 2004, 2005 and 2006 being the last date to which the accounts of the Company have been made upand audited by us. The financial statement for the year ended March 31, 2006 is approved by the Board ofDirectors of the Company for the purpose of disclosure in the Offer Document being issued by the Companyin connection with the Public Issue of Equity Shares in the Company (referred to as ‘the Issue’).

b) In accordance with the requirements of

(i) Paragraph B (1) of Part II of Schedule II to the Companies Act, 1956 (‘the Act’);

(ii) The Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000 (‘theSEBI Guidelines’) issued by the Securities and Exchange Board of India (‘SEBI’) on January 19, 2000in pursuance to Section 11 of the Securities and Exchange Board of India Act, 1992 and relatedamendments thereto and

(iii) Our terms of reference with the Company Letter dated November 11, 2005 requesting us to carry outwork in connection with the Offer Document as aforesaid,

We report that the restated assets and liabilities of the Company as at March 31, 2002, 2003, 2004,2005 and 2006 are as set out in Annexure 1 to this report after making such adjustments/restatementsand regrouping as in our opinion are appropriate and are subject to the Significant Accounting Policiesas appearing in Annexure 3 and Notes to the Statements appearing in Annexure 4 to this report.

We report that the restated profits/losses of the Company for the financial years ended March 31, 2002,2003, 2004, 2005 and 2006 are as set out in Annexure 2 to this report. These profits/losses have beenarrived at after charging all expenses including depreciation and after making such adjustments/restatements and regrouping as in our opinion are appropriate and are subject to the SignificantAccounting Policies as appearing in Annexure 3 and Notes to the Statements appearing in Annexure 4to this report.

B. We have examined the following financial information relating to the Company proposed to be included in the OfferDocument, which has been approved by you and are annexed to this report:

i. Statement of Cash Flows as appearing in Annexure 5 to this report;

ii. Statement of Operational Income as appearing in Annexure 6 to this report;

iii. Statement of Other Income as appearing in Annexure 7 to this report;

iv. Statement of Mandatory Accounting Ratios as appearing in Annexure 8 to this report;

v. Statement of Unsecured Loans as appearing in Annexure 9 to this report;

vi. Statement of Sundry Debtors as appearing in Annexure 10 to this report;

vii. Details of loans and advances as appearing in Annexure 11 to this report;

viii. Statement of Tax Shelters as appearing in Annexure 12 to this report;

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ix. Statement of Dividends paid for the last five years as appearing in Annexure 13 to this report;

x. Capitalization Statement as at March 31, 2006 as appearing in Annexure 14 to this report;

xi. Statement of Secured Loans as appearing in Annexure 15 to this report.

xii. Details of Contingent Liabilities as appearing in Annexure 16 to this report;

xiii. Statement of Related Parties transactions as appearing in Annexure 17 to this report.

C. a) In our opinion the financial information of the Company as stated in Paras A and B above read with SignificantAccounting Policies enclosed in Annexure 3 to this report, after making adjustments/restatements andregroupings as considered appropriate and subject to certain matters as stated in Notes to the Statementsenclosed in Annexure 4 to this report, has been prepared in accordance with Part II of Schedule II of the Actand the SEBI Guidelines.

b) This report is intended solely for your information and for inclusion in the Offer Document in connection withthe specific Public Offer of the Company and is not to be used, referred to or distributed for any other purposewithout our prior written consent.

For Singrodia Goyal & Co.Chartered Accountants

Suresh MurarkaPartnerMem. No. F - 44739

Place : MumbaiDate : May 2, 2006

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ANNEXURE-1 STATEMENT OF ADJUSTED ASSETS AND LIABILITIES (As Restated)

Rs. In Lakhs


A. Fixed Assets:

Gross Block 929.95 672.04 591.53 552.51 520.30

Less : Depreciation 404.29 325.70 262.82 202.39 137.60

Net Block 525.67 346.34 328.71 350.12 382.70

Capital Work in Progress 7.39 2.30 0.65 0.25 -

Total 533.05 348.64 329.36 350.37 382.70

B. Investments - - - - -

C. Current Assets, Loans& Advances

Inventories 775.54 707.14 470.93 330.48 235.06

Sundry Debtors 1,516.49 837.83 464.27 460.18 217.93

Cash and Bank Balances 89.08 71.82 57.56 54.57 33.71

Loans and Advances 292.55 233.95 144.50 106.05 58.44

Total 2,673.65 1,850.73 1,137.26 951.27 545.14

D. Liabilities & Provisions

Share Application Money receivedpending for allotment - 65.00 - - -

Secured Loans 1,018.96 800.37 502.75 587.25 427.46

Unsecured Loans 179.98 118.15 55.82 72.93 51.28

Current Liabilities and Provisions 709.77 466.14 436.94 279.94 194.42

Deferred Tax Provisions 2.10 9.00 8.28 7.97 -

Total 1,910.81 1,458.65 1,003.80 948.09 673.16

E. Networth (A+B+C-D) 1,295.90 740.71 462.83 353.56 254.69

F. Represented by

Share Capital 771.62 487.30 173.53 173.53 173.53

Reserves and Surplus 581.47 254.91 291.09 182.11 83.54

Less: Miscellaneous Expenses notwritten off/ adjusted 57.20 1.49 1.79 2.09 2.39

Net Worth 1,295.90 740.71 462.83 353.56 254.69


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ANNEXURE-2 STATEMENT OF ADJUSTED PORFIT AND LOSSES ACCOUNT (As Restated)

Rs. In Lakhs


INCOME

Operating Income 6337.98 4194.57 3882.83 3397.26 2296.52

Other Income 2.10 1.87 2.03 2.74 3.81

Increase (Decrease) in Stocks 63.99 143.35 93.39 58.85 45.88

Total 6404.06 4,339.79 3,978.25 3,458.85 2,346.21

EXPENDITURE

Raw Material Consumed 5263.55 3,514.92 3,170.86 2,720.56 1,845.87

Staff Costs 125.02 32.98 27.48 24.66 29.65

Other Manufacturing Expenses 346.32 310.31 371.29 348.46 211.89

Administrative, Selling andOther Expenses 230.74 148.92 140.72 97.00 65.06

Total 5,965.63 4,007.13 3,710.34 3,190.68 2,152.48

Profit Before Interest,Depreciation and Tax 438.43 332.66 267.91 268.16 193.73

Interest & Financial Charges 129.87 95.88 70.48 76.23 70.53

Depreciation 78.59 62.88 60.43 64.79 70.83

Net Profit before tax 229.97 173.90 137.00 127.14 52.37

Taxation

Current tax 64.00 14.60 11.10 12.50 4.00

Fringe Benefit Tax 5.67 - - - -

Deferred tax (6.90) 0.71 0.31 0.85 -

Net Profit after tax 167.20 158.59 125.59 113.79 48.37

Income Tax adjustment - - 0.06 (1.20) 0.49

Net Profit after tax adjustments 167.20 158.59 125.53 114.99 47.89

Dividend on Shares 63.76 18.68 13.01 8.68 7.12

Tax on Dividend 8.94 2.62 1.70 1.11 -

Net Profit 94.50 137.30 110.82 105.20 40.77


74


ANNEXURE - 3 SIGNIFICANT ACCOUNTING POLICIES:

1 Basis of Preparation of Financial Statements:

a) The Financial Statements are prepared under the historical cost convention in accordance with the generallyaccepted accounting principles and provisions of the Companies Act, 1956 and comply with the AccountingStandards referred to in Section 211 (3C) of the Companies Act, 1956.

b) Recognition of Income & Expenditure:

The Company follows the accrual basis of accounting except in the following cases, where the same arerecorded on cash basis.

i) Insurance Claim.

ii) Excise Duty payable on uncleared finished goods.

2. Fixed Assets:

a) Fixed Assets are stated at cost net of Modvat less accumulated depreciation. All costs, including financingcost till commencement of commercial production, net charges on foreign exchange contract and adjustmentarising from exchange rate variations attributable to the fixed assets are capitalised.

b) Expenditure during construction period incurred on projects under implementation are treated as preoperativeexpenses pending allocation to the assets and are included under “Capital work in progress”.

3. Depreciation:

a) Depreciation on fixed assets is provided on the Written Down Value Method at the rates specified in ScheduleXIV of the Companies Act, 1956.

b) Depreciation on additions of assets during the year/ period is provided on a pro-rata basis.

4. Inventories:

Inventories are valued as follows:

a) Raw Materials, Packing Materials and Semi-Finished Goods are valued at cost.

b) Finished goods are valued at lower of cost or net realisable value.

5. Miscellaneous Expenditure:

i. Preliminary expenditure incurred prior to 31st March, 2005 are amortised over a period of 10 years from thefinancial year in which it is incurred and Preliminary expenditure incurred after 31st March, 2005 are amortisedover a period of 5 years from the financial year in which it is incurred.

ii. IPO expenses incurred are adjusted with Securities Premium Account in the year of conclusion of IPO.

6. Foreign Exchange Fluctuation:

a) The transactions in foreign currencies on revenue accounts are stated at the rate of exchange prevailing onthe date of transaction.

b) The difference on account of fluctuation in the rate of exchange prevailing on the date of transaction and thedate of realisation is treated as revenue.

c) Differences on translation of Current Assets and Current Liabilities remaining unsettled at the year-end arerecognised in the Profit and Loss account (Except those relating to acquisition of fixed assets which areadjusted in the cost of the assets.)

d) The premium in respect of forward exchange contract is amortised over the life of contract. The net gain orloss on account of any exchange difference, cancellation or renewal of such forward exchange contracts arerecognised in the profit & loss account in the reporting period.

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7. Contingent Liabilities:

These are disclosed by way of Notes forming part of Accounts. Provision is made in the accounts in respect ofthose liabilities which are likely to materialise after the year end, till the finalisation of accounts and have materialeffect on the position stated in the Balance Sheet.

8. Sales:

Sales include excise duty, sales tax and adjusted for discounts.

9. Purchases:

Purchases of raw material, packing material, accessories and store & spares are exclusive of excise duty (ModvatCredit) and adjusted for purchases return, discount, brokerage, commission, rebate and incentives.

10. Deferred Taxation:

Provision for tax is made by applying the applicable tax rates and the tax laws. Deferred tax assets and liabilitiesarising on account of timing differences, which are capable of reversal in one or more subsequent periods, arerecognized using the tax rates and tax laws that have been enacted or substantively enacted by the Balance Sheetdate. Deferred Tax Assets are not recognized unless there is sufficient assurance with respect to the reversal of thesame in future years.

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ANNEXURE-4 NOTES TO STATEMENT OF ASSETS & LIABILITIES AND PROFIT & LOSS ACCOUNT

1. Taxes on Income:

In Terms of Accounting Standard on “Accounting for Taxes on Income” (AS 22) the company has recognised netDeffered Tax Liabilities/ Assets as on 31st March, 2003, 31st March, 2004, 31st March, 2005 and 31st March, 2006as follows:

(Rs. In Lakhs)

Deferred Tax Liability / (Assets) 31.03.2006 31.03.2005 31.03.2004 31.03.2003

On account of Depreciation 5.52 9.00 8.28 7.97On account of Provision for Doubtful Debts (3.42) - - -

Deferred Tax Liability/(Assets) [Net] 2.10 9.00 8.28 7.97

2. Preliminary expenses

In accordance with Accounting Standard 26 issued by ICAI, preliminary expenditure of prior periods as well as ofthe current year are fully written off during the current year.

3. Earning Per Share:

Particulars 31.03.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002

A) Weighted average number ofequity shares of Rs. 10/- each

I) Number of shares at the 4873000 1735310 1735310 1735310 1370310beginning of the year

II) Number of shares at the end 7716242 4873000 1735310 1735310 1735310of the year

III) Weighted average number of 6379458 3493472 3470620 3470620 2840560Equity Shares outstandingduring the year

B) Net Profit after tax adjustments 167.20 158.59 125.53 114.99 47.89available for equity shareholders(In Lacs)

C) Basic and diluted earning per 2.62 4.54 3.62 3.31 1.69share (in rupees) {B/A (III)}annulised

Note :

1. The Company does not have any dilutive potential equity shares. Consequently the basic and dilutedprofit / earning per share of the company remain the same.

2. Earning per share (EPS) is calculated after adjusting for 1735310 bonus shares issued, vide resolutionpassed at the extra ordinary general meeting held on 08.03.2005, with retrospective effect as providedin Accounting Standard (AS –20) – Earning Per Share, issued by the Institute of Chartered Accountantof India.

4. Authorised and Paid Up Capital

At the date of signing of these accounts, the Company has an Authorised Capital of Rs.20,00,00,000 (divided in20,000,000 Equity Shares of Rs. 10 each) and Paid Up Capital of Rs. 7,71,62,420 (divided in 77,16,242 EquityShares of Rs. 10 each) out of which a capital of Rs. 1,73,53,100 (17,35,310 Equity Shares of Rs. 10 each) wereissued as fully paid up bonus shares by capitalisation of Reserves in the year 2004-05.

77


5. Change in Accounting Policy

The Company has not made any changes in its Accounting Policy in any of the reported periods/ years

6. Income Tax adjustments for earlier years

Income Tax adjustments for earlier years include excess/ short provision for tax written back/ written off and areadjusted against the profit of the year to which they are related. Their effect on the Profit/ Reserve for theyear/ period ended is as under:

Year/ Period ended on Reserves lower/ (higher) Current Liabilities lower/by(Rs. In Lacs) (higher) by(Rs. In Lacs)

31.3.2002 0.48 (0.48)

31.3.2003 (1.75) 1.75

31.3.2004 0.06 (0.06)

31.3.2005 0.96 (0.96)

31.3.2006 0.1 (0.10)

7. Change in status and name

During the year the Company has changed its status from ‘Private Limited’ to ‘Public Limited’ by duly complying withthe provisions of the Section 31 of the Companies Act, 1956 and the Registrar of Companies has issued certificatew.e.f 14th July, 2005 to this effect. The name of the Company now is “Bluplast Industries Ltd.”

8. Take over of business

The Company has taken over the manufacturing unit of Alaska Industries, a Partnership Firm in which the directorsare interested as partners, on a slump sale basis, whose business includes manufacturing of Thermoware plasticarticles, w.e.f. 1st July, 2005 vide Business Transfer Agreement dated 1st July, 2005 on a consideration of Rs. 3.00Crores.

In accordance with the said agreement:

i) All immovable/ movable assets of the said unit of said firm stands transferred and vested in the Company asper valuation report dated 1st July, 2005 of M/s Rajesh N. Agarwal & Co. Chartered Accountants.

ii) In view of the aforesaid agreement of acquisition w.e.f. 1st July, 2005 the figures of the current year are notcomparable with those of the previous year.

iii) The secured loan as on 01.07.2005 of Rs. 191.86 lacs availed from Shamrao Vithal Co-op Bank by the saidmanufacturing unit has been completely paid off by the Company on 31.10.2005.

9. Events occurring after Balance Sheet date

i) The Company has undergone an agreement on 20th April, 2006 with Bluplast Corporation, a partnership firm,to purchase the Trademark ‘Bluplast’ for a consideration of Rs. 150 lakhs payable with in 90 days of theexecution of the agreement.

78


ANNEXURE - 5 STATEMENT OF CASH FLOWS FROM THE RESTATED FINANCIAL STATEMENTSRs. In Lakhs


Cash Flow from Operating Activities: Net Profit before tax and beforeextraordinary items 229.97 173.90 137.00 127.14 52.37

Adjustments for :

Depreciation 78.59 62.88 60.43 64.79 70.83Interest Expenses 129.87 95.88 70.48 76.23 70.53Amortisation of Priliminary Expenses 1.90 0.30 0.30 0.30 0.30Interest Income (2.10) (1.87) (2.03) (2.74) (1.05)Direct Tax Paid (31.79) (16.18) (8.94) (6.72) (0.94)

Operating profit before workingcapital changes 406.44 314.90 257.23 259.00 192.03

Adjustments for :

Trade and other receivables (678.66) (373.56) (4.09) (242.25) (65.75)Inventories (68.40) (236.20) (140.45) (95.42) (57.68)Trade Payables 123.12 30.72 139.08 78.58 (1.14)Loans and Advances (26.72) (95.90) (29.51) (47.43) 7.27Net Cash from operating activities (244.22) (360.05) 222.26 (47.51) 74.74

Cash Flow from Investing Activities:

Purchase of fixed assets (257.91) (80.51) (39.02) (32.21) (39.96)Capital Work in Progress (5.09) (1.65) (0.40) (0.25) -Interest Received 2.10 1.87 2.03 2.74 1.05Net Cash used in investment activities (260.91) (80.28) (37.39) (29.72) (38.91)

Cash Flow from Financing Activities:Share Application Money received,pending for allotment (65.00) 65.00 - - -Proceeds from issuing shares 515.44 140.24 - - 41.05Public issue expenses (57.20) - - - -Priliminary Expenditured incurred (0.40) - - - -Proceeds from borrowings 280.42 359.94 (101.61) 181.44 12.00Financing Charges (129.87) (95.88) (70.48) (76.23) (70.53)Dividend Paid including tax thereon (21.29) (14.72) (9.79) (7.12) (3.56)

Net Cash used from financing activities 522.09 454.59 (181.87) 98.09 (21.04)

Net increase in cash and cash equivalents 16.97 14.26 2.99 20.85 14.79

Cash and Cash equivalents (Opening) 71.82 57.56 54.57 33.71 18.92

Cash and Cash equivalents (Closing) 88.78 71.82 57.56 54.57 33.71

Note :

1. The above cash flow statement has been prepared under the “indirect Method” as set out in the AccountingStandard - 3 on cash flow statement issued by the Institute of Chartered Accountants of India.

2. Cash and cash equivalent at the end of the year consist of cash in hand and balances with banks and are net ofshort term loans and advances from banks as follows:

79


Rs. In Lakhs


Cash in hand 19.88 32.40 20.82 19.28 13.40

Balances with Bank 68.90 39.41 36.74 35.28 20.32

Total 88.78 71.82 57.56 54.57 33.71

Annexure - 6 Details of Operational Income

Rs. In Lakhs

Particulars 31.03.2006 31.03.2005 31.3.2004 31.3.2003 31.3.2002

Sales 6,705.39 4,610.22 4,347.31 3,653.55 2,511.95

Sales of Wastages 7.07 8.59 5.84 6.90 3.98

Export Incentive & Others 5.22 8.94 28.59 30.48 4.08

Foreign Exchange Fluctuation (Net) (23.39) 1.16 (4.96) (0.17) 0.11

Job Work Income - - - -

6,694.31 4,628.91 4,376.78 3,690.76 2,520.12

Less: Excise duty & Education Cess 356.33 434.34 493.95 293.50 223.61

Total 6,337.98 4,194.57 3,882.83 3,397.26 2,296.52

Annexure - 7 Details of Other Income

Rs. In Lakhs

Particulars 31.03.2006 31.03.2005 31.3.2004 31.3.2003 31.3.2002 Remarks

Interest Received 2.10 1.87 2.03 2.74 1.05 RecurringNon-

recurring

Insurance Claim Received - - - - 2.76

Total 2.10 1.87 2.03 2.74 3.81

Annexure - 8 Mandatory Accounting Ratios

Rs. In Lakhs

Particulars 31.03.2006 31.03.2005 31.3.2004 31.3.2003 31.3.2002

Earning Per Share (EPS) (Rs.) [a/b] 2.62 4.54 3.62 3.31 1.69

Cash Earning Per Share (Rs.) [d/b] 3.77 6.37 5.38 5.21 4.19

Return on Net Worth (%) [a/e %] 12.90% 21.41% 27.12% 32.52% 18.80%

Net Asset Value Per Share (Rs.) [f/c] 16.79 15.20 26.67 20.37 14.68

80


Notes :

Rs. In Lakhs

Particulars 31.03.2006 31.03.2005 31.3.2004 31.3.2003 31.3.2002

1 Net Profit after tax adjustments [a] 167.20 158.59 125.53 114.99 47.89

Weighted Average No. of Equity 6,379,458 3,493,472 3,470,620 3,470,620 2,840,560Shares [b]

No. of Equity Shares [c] 7,716,242 4,873,000 1,735,310 1,735,310 1,735,310

Cash Earning [d] 240.78 222.48 186.57 180.94 119.01

Net Worth [e] 1,295.90 740.71 462.83 353.56 254.69

Net Asset [f] 1,295.90 740.71 462.83 353.56 254.69

2. Cash Earning = Net Profit after tax adjustments add Depreciation, Preliminary Expenses written off andDeferred Tax Liability

Net Worth = Equity Share Capital plus Reserves & Surplus less Miscellaneous Expenditure to the extent notwritten off

Net Asset = Equity Share Capital plus Reserves & Surplus less Miscellaneous Expenditure to the extent notwritten off

3. The Company does not have any dilutive potential equity per shares. Consequently the basic and diluted profit /earning per share of the company remain the same. Earning per share (EPS) is calculated after adjusting for1735310 bonus shares issued, vide resolution passed at the extra ordinary general meeting held on 08.03.2005,with retrospective effect as provided in Accounting Standard (AS –20) – Earning Per Share, issued by the Instituteof Chartered Accountant of India.

Annexure - 9 Statement of Unsecured Loans :

Rs. In Lakhs

Particulars 31.03.2006 31.03.2005 31.3.2004 31.3.2003 31.3.2002

Trade Deposits (Note 1) - 13.00 17.00 - -

From Directors, Share Holders &Associate Concerns (Note 2) 56.19 70.05 33.94 62.98 41.23

Inter Corporate Deposits (Note 3) 92.22 - 4.88 9.96 10.06

Unsecured Loans from Banks 31.57 35.09 - - -

Total 179.98 118.15 55.82 72.93 51.28

Notes:

1. Interest free amount collected from C & F Agents as Security Deposit in respect of the Agencies given to them. Thesame is repayable as and when the Agency is terminated/cancelled after adjusting the amount receivable by theCompany towards supply of goods.

2. Interest free loans taken are ‘on call’, there are no stipulation regarding their repayments.

3. Inter Corporate Deposits for the year ended 31st March 2004, 2003 & 2002 are interest free and shall be repayableon call basis

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Annexure - 10 Age-wise Analysis of Sundry Debtors

Rs. In Lakhs

Particulars 31.03.2006 31.03.2005 31.3.2004 31.3.2003 31.3.2002

Age wise Break-up

Considered Good

Less than six months 1,213.90 646.14 324.69 383.06 195.97More than six months 302.59 191.69 139.58 77.12 21.97

Considered Doubtful

More than six months 14.52 - - - -Less: Provision for doubtful debts (14.52) - - - -

Total 1,516.49 837.83 464.27 460.18 217.93

The above figures includes Rs. 5.08 lakhs and Rs. 2.38 lakhs due from companies in which directors are interested for theyear ended 31.03.2003 and 31.03.2002 respectively.

Annexure - 11 Loans and Advances

Rs. In Lakhs

Particulars 31.03.2006 31.03.2005 31.3.2004 31.3.2003 31.3.2002

Advance recoverable in cash or in kind 37.98 190.34 17.26 38.20 34.28

Other Current Assets 65.18 37.53 114.78 64.45 21.11

Deposits 152.16 0.74 0.66 0.54 0.37

Advance tax and TDS 37.23 5.34 11.80 2.86 2.68

Total 292.55 233.95 144.50 106.05 58.44

Advance recoverable in cash or in kind or for value to be received:

i) for the year ended on 31.03.2006 and 31.03.2005 includes deposit of Rs. 150.00 lacs and 100.80 lacs respectivelyfor exclusive user rights of brand name “BLUPLAST” made to a firm “Bluplast Corporation” in which Directors areinterested.

ii) includes Rs. 75.00 lacs, 2.68 lacs, 3.12 lacs and 5.47 lacs due from companies in which directors are interested forthe year ended 31.03.2005, 31.03.2004, 31.03.2003 and 31.03.2002 respectively.

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ANNEXURE - 12 TAX SHELTER STATEMENT

Rs. In Lakhs

Particulars Year Ended March 31,

2006 2005 2004 2003 2002

Tax Rate 30% 35% 35% 35% 35%

Surcharge 10% 2.5% 2.5% 5% 2%

Educational Cess 2% 2% - - -

Net Profit before Tax 229.97 173.90 137.00 127.14 52.37

Tax at Notional Rate 77.41 63.64 49.15 46.73 18.70

Adjustments :

Difference between Tax Depreciationand Book Depreciation (14.76) 5.20 1.24 3.41 4.83

Deduction for Backward Area u/s 80IB 79.05 160.63 106.87 92.96 46.94

Deduction for Export Profits u/s 80HHC - - 2.39 2.90 -

Other Adjustments (23.99) (0.86) 0.30 0.30 0.60

Net Adjustments 40.30 164.97 110.80 99.57 52.37

Tax Saving thereon 13.57 60.37 39.75 36.59 18.70

Total Taxation 63.84 3.27 9.40 10.14 0.00

Profit as per Income Tax Returns 189.67 8.93 26.20 27.58 0.00

Brought Forward Losses Adjusted - - - - -

Taxable Income/ (Loss) 189.67 8.93 26.20 27.58 0.00

Taxable Income as per MAT 229.97 173.90 137.00 127.14 52.37

Tax as per Income Tax Returns 63.84 13.64 9.92 10.13 4.01

ANNEXURE-13 STATEMENT OF DIVIDENDS PAID FOR THE LAST FIVE YEARS

(Rs. In lakhs)

YEAR ENDED Equity Share Capital Dividend Amount Tax on Dividend Dividend %

31.03.2006 771.62 63.76 8.94 10.00

31.03.2005 487.30 18.68 2.62 10.00

31.03.2004 173.53 13.01 1.70 7.50

31.03.2003 173.53 8.68 1.11 5.00

31.03.2002 173.53 7.12 - 5.00

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ANNEXURE - 14 CAPITALISATION STATEMENT(Rs. In lakhs)

Pre-offer as at Post-offer** 31/03/2006

Shareholders’ Funds:

-Share Capital 771.62 1871.62-Securities Premium 231.11 2651.11- Other Reserves 350.36 350.36Less: Miscellaneous Expenditure to the extent not written off 57.20 57.20

Total Shareholders funds (A) 1295.90 4815.89

Borrowings:

Secured

- Short Term Debt 903.43 903.43- Long Term Debt 115.53 115.53Unsecured Debts 179.98 179.98

Total Debt (B) 1198.94 1198.94

Debt/Equity Ratio (B/A) 0.93 0.25

** Post offer Share Capital & Securities Premium includes 110 lacs shares of Rs. 10 each issued at Rs. 32.

Annexure - 15 Details of Secured Loans outstanding as on March 31, 2006

(Rs. In Lakhs)

Particulars of Loan Bank Nature Sanc- Amount Rate of Repayment of Securities Offeredof Loan tioned Outstan- Interest Terms (period)

Amount ding P.A. (%)

1. Corporate Loans/ UTI Bank Term 6 0 0.00 9.75% Upto December 2005. Exclusive charge on assetsTerm Loans from Ltd. Loan I Equal monthly instalments created out of the existingBanks of Rs. 6 lac (approx). term loan and corporate loan

Interest to be serviced which were taken over.separately. Exclusive charge on assets

created out of the additionalcorporate loan

Term 150 137.50 9.75% For 60 months. Principal Exclusive hypothecation onLoan II repayment in equal monthly Company’s entire moveable

installments of Rs. 2.50 lacs. assets both present & futureMonthly interest to be & equitable mortgage ofserviced separately. entire immovable assets.

Corporate 39.00 2.84 9.75% Upto March 2006. Equal Exclusive charge on assetsLoan I monthly instalments of created out of the existing

Rs. 3 lac (approx.) Interest term loan and corporate loanto be serviced separately. which were taken over.

Exclusive charge on assetscreated out of the additionalcorporate loan

Corporate 50.00 10.00 9.75% 15 months. Equal monthly Exclusive charge on assetsLoan II instalments of Rs. 3.33 lac. created out of the existing

Interest to be serviced term loan and corporate loanseparately. which were taken over.

Exclusive charge on assetscreated out of the additionalcorporate loan

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(Rs. In Lakhs)

Particulars of Bank Nature Sanc- Amount Rate of Repayment of Securities OfferedLoan of Loan tioned Outstan- Interest Terms (period)

Amount ding P.A. (%)

2. Working UTI Bank WCDL/ 800 520.00 9.75% 12 months, payable on Exclusive hypothecation onCapital Facility Ltd. FCL (520) demand. moveable assets including

book debts bothpresent &

future.

Cash 800 336.16 10.00% 12 months, payable on Exclusivehypothecation on

Credit (280) demand. moveable assets includingbook debts both present &future.

SVC Bank Cash - 0.00 12.50% See note(i) below. Exclusive hypothecation onLtd. Credit moveable assets including

stocks, book debts bothpresent & future & by firstcharge on all immovableproperties of the firmincluding Plant & Machinery.

3. Car Loan HDFC Bank Hire 5.62 0.00 8.36% Monthly installments of Rs. Car itselfpurchase 17,350/-andinstallment

ICICI Bank Hire 6.00 5.66 10.23% 36 months. Equal monthly Car itselfLtd purchase installments of Rs. 19,260/-

andinstallment

Kotak Hire 2.05 1.88 10.31% 35 months. Equal monthly Car itselfMahindra purchase installments of Rs. 6400/-Primus Ltd. and

installment-I

Hire 2.67 2.46 10.31% 35 months. Equal monthly Car itselfpurchase installments of Rs. 8827/-andinstall-ment —II

Hire 2.67 2.46 10.31% 35 months. Equal monthly Car itselfpurchase installments of Rs. 8827/-and install-ment —III

Note:

i) The secured loan as on 01.07.2005 of Rs. 191.86 lacs availed from Shamrao Vithal Co-op Bank by the AlaskaIndustries has been completely paid off by the Company on 31.10.2005

ii) Term Loan I has been fully paid off by the Company on 10-02-2006

iii) The Santioned amount of Working Capital Facility from UTI Bank includes sublimits of: Rs. 520 lacs for workingcapital demand loan(WCDL) and Rs. 280 lacs for cash credit facility.

85


Details of Secured LoansRs. In Lakhs


1. Corporate Loans /Term Loans from Banks

From Banks

UTI Bank Ltd. 150.34 130.09 - - -

State Bank of India - - 171.36 264.72 224.72

HDFC Bank - - - - -

Sub Total 150.34 130.09 171.36 264.72 224.72

2. Working Capital/ FCNR/ Cash

Credit Facility

UTI Bank Ltd. 856.16 644.96 - - -

State Bank of India - 23.44 327.53 322.52 201.52

SVC Bank Ltd. - - - - -

HDFC Bank - - - - -

Sub Total 856.16 668.4 327.53 322.52 201.52

3. Demand Loan

American Express Bank - - - - 1.22

Sub Total - - - - 1.22

4. Car Loan

HDFC Bank - 1.88 3.86 - -

ICICI Bank Ltd 5.66 - - - -

Kotak Mahindra Primus Ltd 6.80 - - - -

Sub Total 12.46 1.88 3.86 0.00 0.00

TOTAL SECURED LOANS 1018.96 800.37 502.75 587.25 427.46

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Annexure - 16 Contingent Liabilities

(Rs. In Lakhs)

Particulars 31.03.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002

Bank Guarantee 33.05 33.05 33.05 33.05 33.05

Capital Contract remaining 41.17 17.82 3.26 7.71 13.32to be executed

Claim against the Company not - - 11.53 11.53 11.53acknowledged as Debts

Deposit remaining to be paid for exclusive - 49.20 - - -use of Licensed rights

Export obligation under EPCG license - 0.35 28.05 56.11 58.58

I.T demand under appeal 3.04 - - - -

Total 77.26 100.42 75.90 108.41 116.48

Note :

(1) Company has taken license under Export Promotion Capital Goods Scheme (EPCG) for import of capital goods onzero percent custom duty. Under the EPCG the Company needs to fulfill certain export obligations, failing which, itis liable for payment of custom duty.

Annexure - 17 Information on Related Party Disclosures as per AS-18.

1. For the period ended 31st March, 2006

(a) Key Management Pesonnel & Relatives

(Rs. In Lakhs)

Directors Unsecured Repayment Loans SharesRemuneration Loans Taken of Loans Payable Allotment/

Taken Application

Mr. Kamlesh L.Jain 4.95 1.75 2.13 0 176.49

Mr. Indermal P.Jain 4.95 88.03 89.31 10.56 135.27

Mr. Prince Jain 0 0 0 0 0

Mr. R.D. Jain 0 0 0 0 0

Mr. Arvind Mehta 0 0 0 0 0

Mrs. Rekha K. Jain 0.60 2.60 0.75 0 67.58

Mrs. Nayana I. Jain 0.60 0.60 0.75 0 69.60

Total 11.10 92.98 92.94 10.56 448.94

87



(Rs. In Lakhs)

Purchases Sales Unsecu- Repay- Loans Rent Job Interest Royalty Other Purch-red ment of Paya- paid Charges Paid Paid Receiv- ase of

Loans Loans ble Paid ables theTaken Taken under-

takingAlaska Industries 122.86 0 0 0 0 0.30 3.87 0 0 0 300.00

Bluplast Corporation 0 14.46 134.13 91.85 42.28 0 0 2.00 29.54 150.00 0

Bluplast Industries 0 0 0 0 0 0 0 0 0 0 0

Bluplast Pentechs 0.09 0 0 0 0 0 0 0 0 0 0

Bluplast Utility Products 2.10 0 0 0 0 0 0 0 0 0 0

Bluplast Moulders Pvt.Ltd. 0 0 0 0 0 0 0 0 0 0 0

Total 125.05 14.46 134.13 91.85 42.28 0.30 3.87 2.00 29.54 150.00 300.00


1. For the Previous year ended 31st March, 2005

(a). Key Management Pesonnel

(Rs. In Lakhs)

Directors Repayment of Shares LoansRemuneration Loans Taken Allotment / Payable

Application

Mr. Kamlesh L.Jain 1.50 2.00 175.19 5.99


Mrs. Rekha K. Jain 1.50 0 0.01 1.20

Mrs. Nayana I. Jain 1.50 0 0.01 1.20

Total 6.00 5.94 307.05 10.53

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(Rs. In Lakhs)

Purchases Sales Rent Paid Job Repayment Loans Deposits/ Shares Other

Charges of Loans Received Loans & Allotment / Recei-

Paid Taken Back Advances Application vables

Alaska Industries 225.53 119.86 1.20 19.93 0 0 75.00 0 75.00

Bluplast Corporation 0 0 0 0 0 0.80 100.80 0 100.80

Bluplast Industries 0 5.59 0 0 12.67 0 0 0 0

Bluplast Pentechs 0 0 0 0 0 1.88 0 0 0

Bluplast Utility Products 0 0 0 4.50 0.45 0 0 1.85 0


Total 225.53 125.45 1.20 24.43 18.00 2.68 175.80 6.72 175.80



(a). Key Management Pesonnel(Rs. In Lakhs)

Directors Unsecured Repayment LoansRemuneration Loans Taken of Loans Payable

Taken

Mr. Kamlesh L.Jain 1.20 0 0 7.99


Mrs. Rekha K. Jain 1.20 0 0 1.20

Mrs. Nayana I. Jain 1.20 0 0 1.20

Total 4.80 1.10 0.14 16.47


(Rs. In Lakhs)

Purchases Sales Job Unsecu- Repayment Loan Sundry Loans Other

Charges red Loans of Loans Granted Creditors Payable Recei-


Alaska Industries 94.75 0 19.45 172.3 198.19 0 0.86 0 0

Bluplast Corporation 0 0.10 0 0 1.24 0.80 0 0 0.80

Bluplast Industries 0 0 0 0.09 0 0 5.56 12.67 0

Bluplast Pentechs 0 0 0 0 0 0 0 0 1.88

Bluplast Utility Products 0 0.12 5.40 0.45 0 0 8.81 0.45 0


Total 94.75 0.22 24.85 172.84 204.51 0.80 15.23 18.00 2.68


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(Rs. In Lakhs)

Directors Unsecured LoansRemuneration Loans Taken Payable

Mr. Kamlesh L.Jain 1.20 2.64 7.99

Mr. Indermal P.Jain 1.20 2.58 5.12

Mrs. Rekha K. Jain 1.20 0 1.20

Mrs. Nayana I. Jain 1.20 0 1.20

Total 4.80 5.22 15.51

(c) Name of the enterprises having same Key Management Personnel and / or their relatives as the reportingenterprise with whom the Company has entered into transactions during the year.

(Rs. In Lakhs)

Sales Job Unsecured Repayment Sundry Sundry Loans Other

Charges Loans of Loans Debtors Creditors Payable Receiva-

Paid Taken bles

Alaska Industries 0 12.13 5.28 0 0 0.75 25.89 0

Bluplast Corporation 5.73 0 0 0 0 0 0 1.24

Bluplast Industries 0 0 8.25 0.10 0 5.56 12.58 0

Bluplast Pentechs 0 0 0 0 0 0 0 1.88

Bluplast Utility Products 19.62 3.56 0 0 0 3.41 0 0


Total 25.35 15.69 13.53 0.20 5.08 9.72 48.43 3.12



(a) Key Management Pesonnel(Rs. In Lakhs)

Directors Unsecured Repayment LoansRemuneration Loans Taken of Loans Payable

Taken

Mr. Kamlesh L.Jain 1.20 1.83 0.14 5.35

Mr. Indermal P.Jain 1.20 1.58 0 2.54

Mrs. Rekha K. Jain 1.20 1.20 0 1.20

Mrs. Nayana I. Jain 1.20 1.20 0 1.20

Total 4.80 5.81 0.14 10.29

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(Rs. In Lakhs)

Purchases Sales Job Unsecu- Repayment Sundry Loans Other

Charges red Loans of Loans Debtors Payable Receivables

Paid Taken Taken

Alaska Industries 108.31 0 10.25 35.38 21.6 0 20.61 0

Bluplast Corporation 0 0.75 0 1.65 24.7 0.75 0 1.00

Bluplast Industries 0 0 0 8.55 5.27 0 4.43 0

Bluplast Pentechs 0 0 0 0 0 0 0 0

Bluplast Utility Products 0 1.63 0 0 0 1.63 0 4.47


Total 108.31 2.38 10.25 47.35 55.92 2.38 35.1 5.47


91


MANAGEMENT DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITIONAND RESULTS OF THE OPERATIONS

Investors should read the following discussion of the financial condition and result of operation together with the auditedfinancial statement of the Company, for the Financial Year ended March 31, 2006, 2005, 2004, 2003 and 2002 including thenotes thereto and the report thereon, which appear in the section titled Financial Information of the Company beginning onthe page no. 70 of this prospectus.

The financial statements have been prepared in accordance with the Indian GAAP, the companies Act, and the SEBI Guidelinesand restated as described in the report of our statutory auditor M/s Singrodia Goyal & Co, Chartered Accountants dated May2, 2006.

The financial year ends on 31st March of each year, so all references to a particular financial year are to the 12 month periodended 31st March of that year.

Overview:

The Company was incorporated in 1999 in the name of Thermoplast Industries Private Limited, to manufacture Thermoware,Household and other Plastic utility items. The Company set up its manufacturing unit at Daman (in Union Territory of Damanand Diu) with an initial installed capacity of 1,940 MTPA and commercial production started in May 2000. To cater to thegrowing demand for the Company’s product, the installed capacity was increased from 1,940 MTPA to 5,400 MTPA by thefinancial year 2005-06.

The Company has been selling its products under the brand name “Bluplast” and in order to synergies the brand “Bluplast”,with that of the Company, the name of the Company was changed to Bluplast Industries Private Limited on March 11, 2005.Subsequently, the Company was converted in to a public limited company and its name was changed to Bluplast IndustriesLimited on July 11, 2005.

The Company has been promoted by first generation entrepreneurs Mr. Kamlesh Lalchand Jain and his brother Mr. Inder MalPannalal Jain. The Promoters of the Company have been operating in the plastic molded items industry for about two decadesand the first entity was promoted by them in the year 1985 in the name of M/s. Bluplast Corporation with an objective toundertake contract manufacturing and trading of plastic products such as soap cases, plastic mugs, cups, trays, water bottlesetc

The Company manufactures about varieties of household products like casserole, vacuum flasks, lunch boxes, water bottles/ jugs, pickle jars, trays, pet bottles, tea coasters, buckets, tumbler, bath stools, bath tubs, baskets, dust-bins etc.

Over the years, the Company has developed a network of 98 Distributors, and countrywide network of Dealers / Sub-dealersand Retailers to maintain the National Presence of Brand Name ‘Bluplast’.

Factors affecting Results of our Operations

The following are the main factors affecting the results of our operations:

Presence of large number of un organized players in the unorganised sector:

In the Plastic Industry there are a number of unorganized sector producing the similar products at cheaper cost. Though, wehave quality products we may face competition from low cost products in the market.

Foreign Exchange Fluctuations:

Export market of our product constitute around 3% of our total turnover. Their prices are dependent upon, and may fluctuatewith, foreign exchange prices. Any adverse change in currency exchange rates may decrease the revenue from the export.

Key personnels:

We have experienced key personnels in our organization responsible for various activities and the performance of the companylargely dependent on their continuation and performance. Our performance may be affected in their absence.

92


Increase in cost of Raw Material:

Any abrupt or large scale in the prices of the raw materials can adversely affect our profits. Any delay or availability ofrequired material or any other item of production in appropriate quantity and right quality at the right time may affect theresults of our operation.

Discussion on Results of Operations

Rs. In Lakhs

Particulars Year Ended Year Ended Year Ended Year Ended 31.03.2006 31.03.2005 31.03.2004 31.03.2003

INCOME

Operating Income 6337.98 4194.57 3882.83 3397.26

Other Income 2.10 1.87 2.03 2.74

Increase (Decrease) in Stocks 63.99 143.35 93.39 58.85

Total Income 6404.06 4,339.79 3,978.25 3,458.85

Total Expenditure 5,965.63 4,007.13 3,710.34 3,190.68

Profit Before Interest, Depreciation and Tax 438.43 332.66 267.91 268.16

Interest & Financial Charges 129.87 95.88 70.48 76.23

Depreciation 78.59 62.88 60.43 64.79

Net Profit before tax 229.97 173.90 137.00 127.14

Taxation

Current tax 64.00 14.60 11.10 12.50

Fringe Benefit Tax 5.67 - - -

Deferred tax (6.90) 0.71 0.31 0.85

Net Profit after tax 167.20 158.59 125.59 113.79

The Company’s Track Record:

The Company’s Turnover has grown from Rs. 2,296.52 Lakhs in FY-2001-02 to Rs. 6337.98 lakhs in FY 2005-06 and the netprofit has increased from Rs. 41.25 lakhs to Rs. 167.20 lakhs in the corresponding period. Thus the Company due to itscontinuous focus on marketing strategy, has increased its turnover by 83% while the net profit increased by 249%.

Taxation

The Company’s manufacturing unit is situated at Daman which is a notified backward area as per section 80I (B) of IncomeTax Act, 1962 therefore the Company has enjoyed a tax holiday on its profits up to end of FY 2004-05. In view of this, theCompany has provided only Minimum Alternate Tax (MAT) on its profits.

Comparison of the Financial Year ended March 31, 2006 with Financial Year ended March 31, 2005

Turnover & Net Profit

In FY-2005-06 the company achieved a turnover of Rs. 6337.98 lakhs as against Rs. 4194.57 lakhs for the FY’s ended 2004-2005 and the net profit before tax too has increased to Rs. 229.97 lakhs from Rs.173.90 lakhs in the corresponding period.This was mainly on account of continuos focus on marketing strategy and due to increase in installed capacity and utilisationof production capacity.

Raw Material Consumption

The raw material consumption has increased to Rs.5263.55 lakhs in FY-2005-06 from Rs.3514.92 lakhs in FY-2004-05showing an increase of 49.75% due to increase in activity level of the business of the company.

93


Manufacturing Expenses

The manufacturing expenses have increased from Rs. 310.31 lakhs in FY 2005 to Rs. 346.32 lakhs in FY 2006 showing aincrease of 11.72 % due to increase in activity level of the business of the company.

Administrative, Selling and Other Expenses

In absolute terms the above expenses has grown by only 54.94% due to increase in activity level of the business of theCompany, taken over of Alaska industries under slum sales , royalty payment , provision for doubts full debts and further dueto the increase in rates and taxes.

Interest on Financial Charges

Interest and financial charges comprise of interest payments of banks and financial institutions, others and bank charges. Inabsolute terms interest and financial charges have grown by 35.45% due to increase in banking exposure compare to lastyear and also on borrowal of unsecured loan from outsiders.

Comparison of the Financial Year ended March 31, 2005 with Financial Year ended March 31, 2004


In FY-2004-05 the company achieved a turnover of Rs. 4,194.57 lakhs as against Rs. 3,882.83 lakhs for the FY’s ended2003-2004 and the net profit too has increased to Rs. 137.30 lakhs from Rs.110.82 lakhs in the corresponding period. Thiswas mainly on account of continuos focus on marketing strategy.


The raw material consumption has increased from Rs.3170.86 lakhs in FY-2003-04 to Rs.3524.29 lakhs in FY-2004-05 showingan increase of 11.15% due to increase in activity level of the business of the company.


The manufacturing expenses have decreased from Rs. 371.29 lakhs in FY 2004 to Rs. 310.31 lakhs in FY 2005 showing adecrease of 16.42% due to our efficient management, reduction in packing material cost as well as decrease in the outsourcing labour job works and other manufacturing Expenses.


In absolute terms the above expenses has grown by only 5.83% due to increase in activity level of the business of theCompany,expenses incurred on establishment of two depot at Chandigarh and Gahizabad and in increase of insurancepremium due to key man insurance policy taken by the company and further due to the increase in rates and taxes.


Interest and financial charges comprise of interest payments of banks and financial institutions, others and bank charges. Inabsolute terms interest and financial charges have grown by 36.04% due to increase in banking exposure compare to lastyear and also on borrowal of unsecured loan from out siders.

Comparison of the Financial Year ended March 31, 2004 with Financial Year ended March 31,2003


In FY-2003-04 the companies turnover was Rs.3882.83 lakhs as against Rs. 3397.26 lakhs for the FY ended 2002-2003while the net profit has increased to Rs.110.82 lakhs from Rs. 105.11 lakhs in the corresponding period. Thus the Companydue to its continues focus on marketing strategy, it has increased its turnover over 14% while the net profit increased over5.43%.


The raw material consumption has increased from Rs.2720.56 lakhs in FY-2002-03 to Rs.3170.86 lakhs in FY-2003-04 showingand increase of 16.55% due to increase in manufacturing activities of the Company.

94



The manufacturing expenses have increased from Rs.348.46 lakhs in FY 2002-03 to Rs.371.29 lakhs in FY 2003-04 due toincreased turnover.


In absolute terms the above expenses has grown by only 45.07% due to increase in activity level of the business of theCompany, sales promotion and exploring the new market.


Interest and financial charges comprise of interest payments of banks and financial institutions, others and bank charges.The interest and financial charges have decreased from Rs.76.23 lakhs in FY-2002-03 to Rs.70.48 lakhs in FY-2003-04because of reduction of term loan and interest rate on borrowing.

Other Matters

Unusual and Infrequent events of transactions

There have been no unusual or infrequent transactions affecting our business.

Significant economic changes that materially affected or likely to affect income from continuing operation:

There are no circumstances which have arisen since the date of last financial statement until the date of filing of Prospectuswith SEBI, which materially and adversely affect or likely to affect the turnover or the profitability of the Company or value ofits assets, or its ability to pay its liability within next 12 months.

Future changes in relationship between costs and revenues, in case of events such as future increase in labour ormaterial costs or prices that will cause a material change are known

We have successfully developed about 200 varieties of plastic house hold and other utility items and we continue to improveon the new developed items and operation of the Company. Other than as described in this Prospectus, to our knowledge,there are no known factors, which will affect the future relationship between cost and income, or which will have materialimpact on the operations and finances of our Company.

The extent to which the business is seasonal

The business of our company is not seasonal.

Any significant dependence on a single or few suppliers or customers

We are not significantly dependent on any single or few suppliers or customers.

Known Trends or Uncertainties

Other than as described in this Prospectus, to our knowledge, there are no known trends or uncertainties that have or hador are expected to have a material adverse impact on revenue or income of our Company from continuing operations.

New Products or Business Segments

Other than as described in the section titled “Objects of the Issue” and “our Business” of this Prospectus, we do not intendto produce or market any other products.

Competitive conditions

The plastic wood composite profiles/ sheets are new products and the other competitive products available in the marketsare Wood, Syntax Sheets, Gypsum Board, Acrylic Sheets & Panel, Particle Boards, Bakelite Formica Panels, Bison Boardsetc. With existing marketing network, the products introduced by the company are expected to have its demand. The companyalso manufactures a wide range of products of Thermoware, Vacuumware, Insulated-ware, Kitchenware, Utilities and PetProducts. The competitors in this range are Milton and Cello Group of Companies. With the network of 98 Distributors, andDealers / Sub-dealers and Retailers, the Company expects to market its products without any difficulty.

95


DETAILS OF OUTSTANDING LITIGATION

Except as described below, there are no outstanding litigations, suits or criminal or civil prosecutions or proceedings initiatedfor offence(s) (irrespective of whether specified in paragraph (I) of Part 1 of Schedule XIII of the Companies Act) or litigationfor tax liabilities against the Company, its directors, Promoters or companies promoted by its promoters that would have amaterial impact on the business of the Company and there are no defaults, non payment or statutory dues, institutional/bankdues and dues payable to holders of debentures, bonds and fixed deposits and arrears of preference shares that wouldhave a material adverse effect on the business other than unclaimed liabilities by the Company or its directors, its Promotersor companies promoted by its promoters. Further, the directors, promoters or companies promoted by the promoters have notbeen declared as willful defaulter by Reserve Bank of India, and also have not been debarred from dealing in securities and/or accessing the capital markets by SEBI and no disciplinary action has been taken against them by SEBI or any stockexchanges.

Claims against the Promoter

A criminal case being 1606 of 2004 has been filed in the Court at Palghar, District Thane under Section 138 of the NegotiableInstruments Act, 1882 against M/s Plusmore Marketing Pvt. Ltd. and its directors on account of dishonour of certain chequesaggregating Rs.2,23,460/-. Mr. Kamlesh Jain has been made a party to the criminal case since he used to be a director ofM/s. Plusmore Marketing Pvt. Ltd. However, at the time of dishonour of the cheques and the subsequent initiation of the caseagainst M/s Plusmore Marketing Pvt. Ltd., Mr. Kamlesh Jain had already resigned as a director and prior to his resignationwas never involved in day to day operations of M/s Plusmore Marketing Pvt. Ltd. Accordingly, he has filed a reply stating thathe had resigned from M/s Plusmore Marketing Pvt. Ltd. prior to dishonor of the said cheques and has also furnished FormNo.32 in that regard. On his application, he has been exempted from personal appearance in the Court. The case is pendingfor further hearing.

Claims/ litigation filed against the Company:

Save and except for the cases cited below, there are no Sales Tax, Central Excise Tax, cases filed against the Company andthere is no penalty or tax recovery proceedings initiated against the Company.

There has been search in June 2004 in the factory premises of the Company by Central Excise Department to ascertainwhether there is any unauthorized clearance of raw material involving any duty amount of Rs.25,71,000/-. On the day of thesearch itself, the Company has reversed the CENVAT amount of Rs.25,71,000 in its CENVAT account. However, the CentralExcise department has not served any show cause notice to the Company till date.

Income Tax Appeal filed by the Company:

Date of Order Disputed Amount(incl. penalty)

Details Status

12.2.2006 3,04,168/- Assistant Commissioner Income Tax, Income Tax Department,Range 9 (1), Mumbai had imposed income tax liability of Rs.3,04,168 by its Order u/s 143(3) of the Income Tax Act, 1961 bydisallowing deduction claimed by the company under PF/ESICpayments, deduction u/s 80IB and deduction u/s 80 HHC of theIncome Tax Act, 1961 during the assessment year 2003-2004.The company has made an appeal to the Commissioner ofIncome Tax (Appeal) IX, Mumbai against this Order.

The case is filed on March18, 2006 and is pendingbefore the Commissionerfor further hearing.

Refund claim filed by the Company:

1. The Company filed a refund claim of Rs.11,33,735/-. In the Show cause Notice No. V/18-16/2001-2001/R dated13.8.2002 issued in this regard upon the Company filing the reply, an O.I.O. No.SD/02/AC/R/03-04 dated 28.10.03was passed by the Assistant Commissioner whereby the refund claim was disallowed. The Company filed anappeal on 21.12.2003 against this OIO, which was decided in favour of the Company vide OIA No.NS/57/Daman/2005 dated 31.01.2005 passed by the Commissioner, Appeals. Commissioner Central Excise (Appeal) has filed anappeal in CESTAT against the said OIA. The matter is yet to be decided by CESTAT.

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Date of Order Disputed Amount(incl. penalty)

Details Status

Sales Tax Appeals filed by the Company:

19.1.2004 14,165/- Assistant Sales Tax Officer, Sales Tax Department, Daman hadimposed differential tax liability of Rs. 14,165 for applying wrongrate of sales tax on sale of raw material and steel during the period1/4/2000 to 31/3/2001. The company has made an appeal to theAsstt. Commissioner of Sales Tax, Daman against this order.

Notice not served

7.10.2004 65,034/- Assistant Sales Tax Officer, Sales Tax Department, Daman hadimposed differential tax liability of Rs. 65,034 for applying wrongrate of sales tax on sale of raw material and steel during the period1/4/2001 to 31/3/2002. The company has made an appeal to theAsstt. Commissioner of Sales Tax, Daman against this order

Notice not served

Outstanding Litigations against / by Alaska Industries (“Alaska”)

Excise matters:

Show CauseNotice No.

Claim Amount Status Remarks

V/15-33/OA/96/1761dated 22.1.1997

Rs.2,09,974 Certain goods worth Rs.8,39,895/- were found to be in excess ofthe declared quantity and were seized. Custom duty ofRs.1,25,354/- imposed thereon. The Assistant Commissioner calledupon Alaska to produce a Bank Guarantee for Rs.2,09,974/- whichwas produced by Alaska. Subsequently the seized goods werereleased.

The Bank Guarantee hasbeen renewed upto25.10.2005.The case ispending before theAssistant Commissionerfor further hearing.

V(CH-39) 15-3/OA/97 dated 15.5.2000

Rs.3,98,306/- andinterest onRs.1,99,153/-

Alaska filed an appeal to the Commissioner against order ofAssistant Commissioner’s order No.O.I.O. No.SD/AC/41/OA/04-05 dated 30.12.2004. Commissioner has passed order No. O.I.A.No.NS/161/Daman/ 2005 dated 28th March, 2005 and remandedthe matter back to the adjudicating authority for fresh adjudicationby allowing cross-examination of evidences.

The case is pendingbefore the adjudicatingauthority for freshadjudication.

V(CH-39)15-8/OA/97/3549 dated9.5.2000

R s . 5 , 2 5 , 3 9 9 / -towards excise duty,R s . 5 , 2 5 , 3 9 9 / -towards penalty, theplant, machinery andbuilding used byAlaska ordered to beconfiscated with anoption to Alaska toredeem the same onpayment of redem-ption of Rs.1,00,000/- within 30 days ofthe Order. Interest onRs.5,25,399/- till thedate of payment,penalty of Rs.50,000/- on Mr. KamleshJain, Rs.10,000/-each on Mr. RameshJain and VasantPurohit.

Alaska filed an appeal and stay application against the Order ofAdditional Commissioner. A Stay Order No.5-6-7-8 dated 3.2.04was passed for pre-deposit of Rs.5,25,399/-. Alaska filed aMiscellaneous Application on 19.2.2004 to stay the implementationof the Stay Order. The said Miscellaneous Application disposedof vide Stay Order No.39/stay/Daman/2004 dated 20.9.2004 bythe Commissioner, Appeal.

Alaska filed a Special Civil Application against the said Order inthe High Court of Gujarat. The High Court of Gujarat passed anorder dated 22.11.2004 upholding the pre-deposit of Rs.5,25,399/- within 4 weeks from the date therefrom.

Mr. Kamlesh Jain, Mr. Ramesh Jain and Vasant Purohit have filedAppeals and Stay Applications against the imposition of penaltyon each of them. The Company has paid Rs.5,25,399 as pre-deposit amount.

Alaska did not deposit therequisite amount ofRs.5,25,399 accordingly,the Commissionerpassed an order No.O.I.A.N o . N S / 1 1 - 1 2 - 1 3 - 1 4 /Daman/2004 on 22.12.2004 whereby the appealsfiled by Alaska, Mr.Kamlesh Jain, Mr. RameshJain and Mr. VasantPurohit were dismissed.An appeals lies form thisorder to the Commi-ssioner (Appeal) within aperiod of 3 months fromthe date of the order. Note:Alaska has filed an appealwith the Commissioner(Appeal) which wasdismissed as bring time-barred. Alaska has filed astay application inHighCourt of Gujarat atAhmedabad and referredthe case to CommissionerAppeals Daman at Vapi,The last hearing wasfixed on 14.9.2005 whichwas adjourned. The nexthearing date has not beenfixed.

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Show CauseNotice No.

Claim Amount Status Remarks

V(CH-39)15-75/OA/98/ 3556 dated8.5.2000

R s . 5 , 0 2 , 7 0 0 / -towards excise duty,penalty ofRs.5,02,700/-, theplant, machinery andbuilding used byAlaska ordered to beconfiscated with anoption to Alaska toredeem the same onpayment of redem-ption of Rs.1,00,000/- within 30 days ofthe Order, interest onRs.5,02,700/- till thedate of payment,penalty of Rs.1,50,000/- on Mr.Kamlesh Jain andRs.25,000/- on Mr.Vasant Purohit.

Alaska filed an appeal against the O.I.O. No.30/OA/Adj/2003/ JCdated 14.5.2003. The Commissioner, Appeal passed an orderbeing O.I.A.No.RKS/222-223-224/Daman/2004 dated 16.9.2004whereby penalty of Rs.5,02,700/- was set aside, redemption valuewas reduced to Rs.50,000/- and penalty on Mr. Vasant Purohitwas set aside while penalty on Mr. Kamlesh Jain was confirmedagainst which a Stay Application was filed. In the meanwhile theCentral Excise Commissioner filed an appeal against theO.I.A.No.RKS/222-223-224/Daman/ 2004.

On 26.7.2005 the StayApplication came up forhearing and an Order waspassed whereby penaltyagainst Alaska was setaside and the other co-accused were absolvedfrom penalty.3.Redemption amountagainst confiscation orderwere reduced to Rs.35,000/- and the amounthas been paid.

V/15-27/OA/2000-01 dated 28.2.2001

Goods worth Rs.3,08,344/- seizedand excise duty ofR s . 4 9 , 3 3 5 / -imposed.

For the shortage ofgoods of Rs.8,41,831 the duty ofRs.1,31,493 wasimposed.

Certain goods worth Rs. 3,08,344/- were found to be in excessof the declared quantity and were seized. Excise duty ofRs.49,335/- imposed thereon which was paid by Alaska in RG-23(ii) entry no. 77 dated 12.08.2001.

Certain goods worth Rs. 8,41,831 were found to be in Short ofthe declared quantity. Alaska has debited a duty amount ofRs.1,31,493/- in RG-23, Part – II, entry no. 292 dated 10/02/2001towards the short quantity of the goods amount under this showcause notice and requested for release of the seized goods.

The case is pending forfurther hearing.

Refund Claims:

Alaska has filed a Claim for refund of Rs.4,00,955/- paid under protest (S.H.No.3923) on 27.3.2001. Various reminders havebeen sent to the Assistant Commissioner in this regard.

Sales Tax Appeals:

Date of Order Disputed Amount(incl. penalty) in Rs.

Details Status

7.5.2004 14,000/- Assistant Sales Tax Officer, Sales Tax Department, Damanpassed an assessment order for FY 2001-02 and imposeddemand for central sales tax of Rs. 9,000 and penalty of Rs.5,000. Alaska Industries had made an appeal to the Asstt.Commissioner of Sales Tax, Daman against this order.

Notice not served

7.5.2004Notice not served

1,43,192/- Assistant Sales Tax Officer, Sales Tax Department, Damanpassed an assessment order for FY 2001-02 and imposeddemand for sales tax of Rs. 1,44,192. Alaska Industries had madean appeal to the Asstt. Commissioner of Sales Tax, Daman forthe disputed amount of Rs. 1,43,192 against this order.

Notice not served

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Date of Order Disputed Amount(incl. penalty) in Rs.

Details Status

7.5.2004 45,172/- Assistant Sales Tax Officer, Sales Tax Department, Damanpassed an assessment order for FY 2000-01 and imposeddemand for central sales tax of Rs. 40,172 and penalty of Rs.5,000. Alaska Industries had made an appeal to the Asstt.Commissioner of Sales Tax, Daman against this order.

Notice not served

7.5.2004 60,394 Assistant Sales Tax Officer, Sales Tax Department, Damanpassed an assessment order for FY 2000-01 and imposeddemand for sales tax of Rs. 61,394. Alaska Industries had madean appeal to the Asstt. Commissioner of Sales Tax, Daman forthe dispuated amount of Rs. 60,394 against this order.

Note: Pursuant to the Business Transfer Agreement dated 1.7.2005 made between Alaska on the one hand and the Company on the otherhand, Alaska has transferred and the Company has assumed all the assets and liabilities of Alaska for the consideration and on the termsand conditions contained therein. Accordingly, all references to Alaska must be read to mean references to the Company and the casespertaining to Alaska as referred to above are now assumed by the Company therefore any adverse outcome in any of the cases aboveshall deem to mean the liability of the Company w.e.f. 1.7.2005.

Notice not served

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MATERIAL DEVELOPMENTS

Significant development since the last audited balance sheet as on March 31, 2006 till the date of Prospectus

The Company has undergone an agreement on 20th April, 2006 with Bluplast Corporation, a partnership firm, to purchasethe Trademark ‘Bluplast’ for a consideration of Rs. 150 lakhs payable within 90 days of the execution of the agreement.

No circumstances except explained above have arisen since the date of last financial statement until the date of filing of thisProspectus with SEBI, which materially and adversely affect or is likely to affect the operations or profitability of our Company,or value of its assets, or its ability to pay its liability within next twelve months.

There is no subsequent development after the date of the Auditor’s Report, which will have a material impact on the reserves,profits, earnings per share and book value of the Equity Shares of our Company.

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GOVERNMENT APPROVALS

The Company does not require any letter of intent or industrial license from the GoI for carrying out its current operations orthose proposed in this Prospectus. The Company does not require any permission or approval from the GoI and various GoIagencies for proceeding with the proposed capital expenditure from the proceeds of the Issue except those mentioned inthis Prospectus. The Company does not require any further approval from any GoI authority or RBI to undertake the proposedactivities save and except those consents and approvals, which it may require to take in the normal course of business fromtime to time.

The Company has received all the necessary consents, licenses, permissions and approvals from the GoI and various GoIagencies / private certification bodies required for the present business and no further approvals are required for carrying onthe present as well as proposed business of the Company except as mentioned herein. It must, however, be distinctlyunderstood that in granting the above consents / licenses / permissions / approvals, the GoI does not take any responsibilityfor the financial soundness of the Company or for the correctness of any of statements or any commitments made or opinionsexpressed.

Industrial Entrepreneurs Memorandum (“IEM”)

For the purpose of manufacturing the new product ‘PVC Wood Composite Profiles / Sheet’, the Company has filed an IEMdated August 28, 2005 with the Secretariat of Industrial Assistance (“SIA”) which is duly acknowledged by SIA on September2, 2005 vide No.4228/SIA/IMO/2005 for the purpose of establishing a ‘New Undertaking’ at Daman.

For the existing manufacturing unit of the Company, the Company was registered as a permanent SSI vide Registrationcertificate dated December 15, 2000 from Directorate of Industries, Daman bearing registration No.6001001648 category ofunit (S.No.6) U1 granting permanent Small Scale Industry status for manufacturing insulated wares of plastic, tableware/kitchenware of plastic, vacuum ware of plastic and mould and dies of plastic articles to Company.

The Company has filed an IEM to the SIA which is duly acknowledged by SIA on October 31, 2005 vide No. 5111/SIA/IMO/2005 for manufacture of existing product i.e. table ware, kitchen ware, other household articles, toilet articles includingmanufacturing of vacuum flask and other vacuum vessels for enhanced capacity upto 9000 MTPA.

Local Licenses

Sales Tax No.: DA/5540

Registration certificate dated 24.3.2004 under section 11 of the Goa, Daman and Diu (Sales Tax) Act, 1964 w.e.f. 20.5.2000.

Central Sales Tax No.: DA/CST/5008

Registration certificate dated 30.3.1999 under section 7(2) of the Central Sales Tax Act, 1956 w.e.f. 19.3.1999.

Factory Registration:

Registration certificate under Factories Act, 1948 dated 28.7.2004 bearing registration No.2567. This certificate has beenrenewed from time to time and is in force till 31.12.2006.

License to work a factory:

The Company has been granted a license No.1589 on 27.4.2000 by the Chief Inspector of Factories, Daman. This licensehas been renewed from time to time and is in force till 31.12.2006.

Shops and Establishments Registration:

The business of the Company is registered under the Shops and Establishments Act under Registration No. PS-II/010915and the registration is valid upto October 31, 2007

Consent from Pollution Control Committee:

The Company has, in its erstwhile name, i.e. Thermoplast Industries Pvt. Ltd., obtained consent from the Pollution ControlBoard which is valid up to 31.12.2006. The Pollution Control Committee, by its letter dated 27.10.2005, has permitted thetransfer of the consent in favour of the Company.

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ISO 9001:2000 Certified Company

The Company has received the certificate from UKAS Quality Management, An Accreditation Body, dated November 17,2005and become ISO 9001:2000 certified company from that date.

Tax Registration

Service tax registration No.: AABCT0420FST001.PAN number: AABCT0420F.TAN number: MUMT10891G.EPFO No.: GJ /VP/45623Central Excise registration No.: AABCT0420F XM 001.

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OTHER REGULATORY AND STATUTORY DISCLOSURES

Authority for the Issue

Our Board of Directors has pursuant to a resolution dated August 17, 2005 authorized the Issue subject to approval by theshareholders under section 81 (1A) of the Companies Act. The shareholders of our Company have, pursuant to a specialresolution passed at the EGM of the Company held on September 20, 2005 authorized the Issue.

Prohibition by SEBI

Our Company, Directors, any of our Associates or Group Companies, and Companies with which the Directors of Issuer areassociated, as Directors or Promoters, have not been prohibited from accessing the capital market under any order or directionspassed by SEBI.

None of the Promoters, their relatives, the Company or the Promoter Group Companies are declared as willful defaulters byRBI/ Government authorities and there are no proceedings relating to violations of securities laws pending against them andthere are no violations of securities laws committed by them in the past.

Eligibility for the Issue

The Company is eligible for this Issue as per Clause 2.2.1 of SEBI (Disclosure & Investor Protection Guidelines, 2000 asexplained under:

� The Company has net tangible asset of atleast Rs. 300.00 Lakhs in each of the 3 preceding full years (of 12months each) of which not more than 50% is held in monetary assets.

� The Company has a track record of Distributable Profits as per Section 205 of the Companies Act, 1956 for at leastthree out of immediately preceding five years.

� We have a pre-issue Net Worth of not less than Rs. 100 Lakhs in each of the preceding three years (of 12 monthseach).

� The proposed issue size would not exceed five times the pre-issue net worth as per the audited accounts for theyear ended March 31, 2006.

(Rs. In Lakhs)

Financial Year 2005-06 2004-05 2003-04 2002-03 2001-02

Net Tangible Assets 1640.78 999.83 702.15 699.18 531.91

Monetary Assets 89.08 71.82 57.56 54.57 33.71

Distributable Profit After Tax 167.20 158.59 125.53 114.99 47.89

Net Worth 1295.90 740.71 462.83 353.56 254.69

(1) Net Tangible Assets are defined as the sum of fixed assets (including capital work in progress and excludingrevaluation reserves, if any), current assets (excluding deferred tax assets) less current liabilities (excluding deferredtax liabilities and secured as well as unsecured long term liabilities) less working capital loans / FCNR / CashCredit facility.

(2) Monetary Assets are defined as the sum of cash on hand, Non Trade Investments, Balance with Scheduled Bankin Current accounts and Fixed Deposits and balance with Post Office Savings account.

(3) Net Worth includes equity share capital and reserves (net off miscellaneous expenditure not written off)

SEBI DISCLAIMER CLAUSE

AS REQUIRED, A COPY OF THIS PROSPECTUS HAS BEEN SUBMITTED TO SEBI. IT IS TO BE DISTINCTLYUNDERSTOOD THAT SUBMISSION OF PROSPECTUS TO SEBI SHOULD NOT IN ANY WAY BE DEEMED ORCONSTRUED THAT THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANYRESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR THE PROJECT FOR WHICH THEISSUE IS PROPOSED TO BE MADE OR FOR THE CORRECTNESS OF THE STATEMENTS MADE OR OPINIONS

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EXPRESSED IN THE OFFER DOCUMENT. LEAD MANAGERS VIZ. ALLIANZ SECURITIES LIMITED HAS CERTIFIED THATTHE DISCLOSURES MADE IN THE PROSPECTUS ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITHSEBI (DISCLOSURES AND INVESTOR PROTECTION) GUIDELINES IN FORCE FOR THE TIME BEING. THIS REQUIREMENTIS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSEDISSUE.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER COMPANY IS PRIMARILY RESPONSIBLEFOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT INFORMATION IN THE PROSPECTUS,THE LEAD MANAGER IS EXPECTED TO EXERCISE DUE DILIGENCE TO ENSURE THAT THE COMPANY DISCHARGESITS RESPONSIBILITY ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE, THE LEAD MANAGERS VIZ.ALLIANZ SECURITIES LIMITED HAS FURNISHED TO SEBI A DUE DILIGENCE CERTIFICATE DATED JANUARY 21,2006 IN ACCORDANCE WITH SEBI (MERCHANT BANKERS) REGULATIONS 1992 WHICH READS AS FOLLOWS :

i) WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO LITIGATION LIKE COMMERCIALDISPUTES, PATENT DISPUTES, DISPUTES WITH COLLABORATORS ETC. AND OTHER MATERIALS IN CONNECTIONWITH THE FINALISATION OF THE OFFER DOCUMENT PERTAINING TO THE SAID ISSUE;

ii) ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY, ITS DIRECTORS AND OTHEROFFICERS, OTHER AGENCIES, INDEPENDENT VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTSOF THE ISSUE, PROJECTED PROFITABILITY, PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTSMENTIONED IN THE ANNEXURE AND OTHER PAPERS FURNISHED BY THE COMPANY.

WE CONFIRM THAT:

(a) THE PROSPECTUS FORWARDED TO SEBI IS IN CONFORMITY WITH THE DOCUMENTS, MATERIALS ANDPAPER RELEVANT TO THE ISSUE;

(b) ALL THE LEGAL REQUIREMENTS CONNECTED WITH THE SAID ISSUE, AS ALSO THE GUIDELINES,INSTRUCTIONS, ETC. ISSUED BY SEBI, THE GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY INTHIS BEHALF HAVE BEEN DULY COMPLIED WITH; AND

(c) THE DISCLOSURES MADE IN THE PROSPECTUS ARE TRUE, FAIR AND ADEQUATE TO ENABLE THEINVESTORS TO MAKE A WELL INFORMED DECISION AS TO THE INVESTMENT IN THE PROPOSED ISSUE.

WE CONFIRM THAT BESIDE OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE PROSPECTUS ARE REGISTEREDWITH SEBI AND TILL DATE SUCH REGISTRATION IS VALID.

ALL LEGAL REQUIREMENTS PERTAINING TO THE ISSUE WILL BE COMPLIED WITH AT THE TIME OF REGISTRATIONOF THE PROSPECTUS WITH THE ROC IN TERMS OF SECTION 60 OF THE COMPANIES ACT, 1956.

THE SECURITIES PROPOSED TO FORM PART OF THE PROMOTERS CONTRIBUTION SUBJECT TO LOCK IN, WILLNOT BE DISPOSED / SOLD/ TRANSFERRED BY THE PROMOTERS DURING THE PERIOD STARTING FROM THE DATEOF FILING THE PROSPECTUS WITH SEBI TILL THE DATE OF COMMENCEMENT OF LOCK IN PERIOD AS STATED INTHE PROSPECTUS.

THE FILING OF PROSPECTUS DOES NOT, HOWEVER, ABSOLVE THE COMPANY FROM ANY LIABILITIES UNDERSECTION 63 OR 68 OF THE COMPANIES ACT, 1956 OR FROM THE REQUIREMENT OF OBTAINING SUCH STATUTORYOR OTHER CLEARANCES AS MAY BE REQUIRED FOR THE PURPOSE OF THE PROPOSED ISSUE. SEBI, FURTHERRESERVES THE RIGHT TO TAKE UP, AT ANY POINT OF TIME, WITH THE LEAD MANAGER ANY IRREGULARITIES ORLAPSES IN THIS PROSPECTUS.

DISCLAIMER FROM THE ISSUER AND THE LEAD MANAGER

The Company, its Directors and the Lead Manager accepts no responsibility for statements made otherwise than in thisProspectus or in the advertisement or any other material issued by or at instance of the Company and that anyone placingreliance on any other source of information, including our website, www.bluplast.com, would be doing so at his or her ownrisk.

CAUTION

The Lead Managers accepts no responsibility, save to the limited extent as provided in the Memorandum of Understandingentered into between the Lead Managers and the Company.

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All information shall be made available by the Lead Managers and the Company to the public and investors at large and noselective or additional information would be available for a section of investors in any manner whatsoever including roadshow presentations, research or sales reports or at collection centres or elsewhere.

DISCLAIMER IN RESPECT OF JURISDICTION

This Issue is being made in India to persons resident in India, including Indian nationals resident in India, who are majors,Hindu Undivided Families, Companies, Corporate Bodies and Societies registered under the applicable laws in India andauthorized to invest in shares, Indian Mutual Funds registered with SEBI, Indian Financial Institutions, Commercial Banks,Regional Rural Banks, Co-operative Banks (subject to RBI permission) or Trusts registered under the applicable Trust lawand who are authorized under their constitution to hold and invest in shares, permitted insurance companies and pensionfunds and to permitted non residents including NRIs , FIIs and other eligible Foreign Investors (viz.Foreign Venture CapitalFunds registered with SEBI, multilateral and bilateral Development Financial Institutions). The Prospectus does not, however,constitute an invitation to subscribe to equity shares issued hereby in any other jurisdiction to any person to whom it isunlawful to make an invitation in such jurisdiction. Any person into whose possession this Prospectus comes is required toinform himself or herself, about and to observe, any such restrictions. Any dispute arising out of this Issue will be subject tothe jurisdiction of appropriate court(s) in Mumbai (India) only.

No action has been or will be taken to permit a public offering in any jurisdiction where action would be required for thatpurpose, except that this Prospectus has been filed with SEBI for observations and SEBI has given its observations.Accordingly, the Equity Shares, represented thereby may not be offered or sold, directly or indirectly, and this Prospectusmay not be distributed, in any jurisdiction, except in accordance with the legal requirements applicable in such jurisdiction.Neither the delivery of this Prospectus nor any sale hereunder shall, under any circumstances, create any implication thatthere has been no change in the our affairs from the date hereof or that the information contained herein is correct as of anytime subsequent to this date.

DISCLAIMER CLAUSE OF BOMBAY STOCK EXCHANGE LIMITED (BSE, the Designated Stock Exchange)

Bombay Stock Exchange Limited (“the Exchange”) has given vide its letter dated February 24, 2006 permission to thisCompany to use the Exchange’s name in this Offer Document as one of the stock exchanges on which this Company’ssecurities are proposed to be listed. The Exchange has scrutinized this Offer document for its limited internal purpose ofdeciding on the matter of granting the aforesaid permission to this Company. The Exchange does not in any manner:

i) warrant, certify or endorse the correctness or completeness of any of the contents of this Offer document; or

ii) warrant that the Company’s securities will be listed or will continue to be listed on the respective exchanges; or

iii) take any responsibility for the financial or other soundness of this Company, its Promoters, its management or anyscheme or project of the Company;

and it should not for any reason be deemed or construed that this Offer document has been cleared or approved by theExchange. Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuantto independent inquiry, investigation and analysis and shall not have any claim against Exchange whatsoever by reason ofany loss which may be suffered by such person consequent to or in connection with such subscription/acquisition whetherby reason of anything stated or omitted to be stated herein or for any other reason whatsoever.

DISCLAIMER CLAUSE OF THE NATIONAL STOCK EXCHANGE OF INDIA LIMITED (NSE)

As required, a copy of this Offer Document has been submitted to National Stock Exchange of India Limited (hereinafterreferred to as NSE). NSE has given vide its letter ref: NSE/LIST/20812-T dated March 8, 2006 permission to the Issuer to usethe Exchange’s name in this Offer Document as one of the stock exchanges on which the Issuer’s securities are proposedto be listed. The Exchange has scrutinized this draft offer document for its limited internal purpose of deciding on the matterof granting the aforesaid permission to this Issuer. It is to be distinctly understood that the aforesaid permission given by NSEshould not in any way be deemed or construed to mean that the Offer document has been cleared or approved by NSE; nordoes it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Prospectus;nor does it warrant that the Company’s securities will be listed or will continue to be listed on the Exchange; nor does it takeany responsibility for the financial or other soundness of this Issuer, its promoters, its management or any scheme or projectof this Issuer.

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Every person who desires to apply for or otherwise acquire any securities of this Issuer may do so pursuant to an independentinquiry, investigation and analysis and shall not have any claim against the Exchange whatsoever by reason of any losswhich may be suffered by such person consequent to or in connection with such subscription/acquisition whether by reasonof anything stated or omitted to be stated herein or any other reason whatsoever.

FILING

A copy of this Prospectus has been filed with SEBI at Corporation Finance Department, Ground Floor, Mittal Court, “A” Wing,Nariman Point, Mumbai - 400021.

A copy of the Prospectus, along with the material contracts and documents required to be filed under section 60 of theCompanies Act, 1956 having being attached thereto, will be delivered for registration to the Registrar of Companies, Mumbai,Maharashtra

ANNOUNCEMENT ON PRE-ISSUE ADVERTISEMENT

Subject to Section 66 of the Companies Act, the Company shall after receiving final observations, if any, on this Prospectusfrom SEBI, publish an advertisement, in the form prescribed by the SEBI (DIP) Guidelines in an English National daily withwide circulation, one Hindi National newspaper and a regional lanugauge newspaper (Marathi) with wide circulation.

IMPERSONATION

As a matter of abundant caution, attention of the applicants is specifically drawn to the provisions of sub-section (1) of Section68 A of the Companies Act, 1956 which is reproduced below:

“Any person who:

(a) makes in a fictitious name, an application to a Company for acquiring or subscribing for, any shares therein,or

(b) otherwise induces a Company to allot, or register any transfer of shares, therein to him, or any other personin a fictitious name,

shall be punishable with imprisonment for a term which may extend to five years.”

LISTING

This is an unlisted company. Initial listing applications have been made to Bombay Stock exchange (Designated StockExchange) and National Stock Exchange of India for permission to list equity shares and for an official Quotation of theequity shares of the company.

In case, the permission for listing and or dealing & official quotation of the Equity Shares is not granted by any of the abovementioned Stock Exchanges, the Company shall forthwith repay, without interest, all moneys received from the applicants inpursuance of this Prospectus. If such money is not repaid within 8 days after the day from which we become liable to repayit, i.e from the date of refusal or within 70 days from the bid /issue closing date, which ever is earlier, then we and everydirector of ours, be jointly and severallyshall, on and from such expiry of 8 days be liable to repay that money with interestas prescribed under Section 73 of the Companies Act, 1956.

The Company together with the Lead Managers shall ensure that all the steps for the completion of the necessaryrequirements for Listing and Commencement of trading at all the Stock Exchanges mentioned above are taken within 7working days of finalisation and adoption of the Basis of Allotment for the Issue.

CONSENTS

Consents in writing of: (a) our Directors, the Company Secretary, Compliance Officer, the Auditors, Bankers to the Company;and (b) Lead Managers to the Issue and Bankers to the Issue/ escrow collection, banker, Syndicate members, monitoringagency, Registrars to the Issue and Legal advisors to the Issue, to act in their respective capacities, have been obtained andsuch consents have not been withdrawn upto the delivery of this Prospectus.

M/s Singrodia Goyal & Co., Statutory Auditors, have also given their consent to the inclusion of their report as appearinghereinafter in the form and context in which it appears in this Prospectus and also tax benefits accruing to the Company andto the members of the Company and such consent and report have not been withdrawn up to the time of delivery of thisProspectus

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EXPERT OPINION

Except as stated in the section titled “Statement of Tax Benefits” And “Financial Statements” we have not obtained any expertopinion.

PUBLIC ISSUE EXPENSES

The expenses for this Issue includes issue management fees, selling commission, distribution expenses, legal fees, fees toadvisors, stationery costs, advertising expenses and listing fees payable to the Stock Exchanges, among others. The totalexpenses for this Issue are estimated at approximately Rs. 250 Lakhs, details of which are as under:

(Rs. In Lakhs)

Activity Amount (Rs. in lakhs) % of Total Issue Size

Issue Management, Brokerage & Selling commission 80.00 2.27%

Registrars fees 25.00 0.71%

Printing & Distribution of Issue Stationery 70.00 1.99%

Advertising and Marketing expenses 50.00 1.42%

Other expenses 25.00 0.71%

Total 250.00 7.10%

Fees Payable to Lead Managers to the Issue

The total fees payable to the Lead Manager for the issue will be as per the Memorandum of Understanding executed betweenthe Company and the LMs dated September 29, 2005, copy of which is available for inspection at the Registered Office ofthe Company.

Fees Payable to Registrar to the Issue

The total fees payable to the Registrar to the Issue will be as per the Memorandum of Understanding dated October 27,2005, copy of which is available for inspection at the Registered Office of the Company.

Adequate funds will be provided to the Registrar to the Issue for making refunds to unscessful applicants as per the modedisclosed which is appearing on page no. 116.

Previous Public or Rights Issues (during the last five years)

Bluplast Industries Limited has not made any public or rights Issue during last five years.

Companies under the same management

There are no companies within the meaning of Section 370 (1B) of the Companies Act, 1956 which made any capital issueduring the last three years.

PROMISE VIS-A-VIS PERFORMANCE

(A) LAST THREE ISSUES MADE BY BLUPLAST INDUSTRIES LTD.

The company has not made any issue of equity shares to the public prior to the present Public Issue.

(B) LAST ISSUE OF THE LISTED VENTURES OF PROMOTER GROUP

There is no listed venture of the Promoter Group.

Outstanding Debentures, Bonds, Redeemable Preference Shares or other Instruments

The Company, since its incorporation has not issued any Redeemable Preference shares and debentures, bonds or otherinstruments.

Stock Market Data for our Equity Shares

This being the first Public Issue of the Company, no Stock Market Data is available.

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Mechanism evolved for Redressal of Investor Grievances

The Company has appointed Bigshare Services Pvt. Ltd. as the Registrar o the Issue, to handle the investor grievances inco-ordination with Compliance Officer of the Company. All grievances relating to the present issue may be addressed to theregistrar with a copy to the Compliance Officer, giving full details such as name, address of the applicant, number of EquityShares applied for, amount paid on application and Bank branch where the application was submitted. The Company willmonitor the work of the Registrar to ensure that the grievances are settled expeditiously and satisfactorily.

Disposal of Investor Grievances

M/s.Bigshare services Pvt. Ltd., the Registrar to the Issue, will handle investor grievances pertaining to the Issue. A fortnightlystatus report of the complaints received and redressed by them would be forwarded to the Company. The Company wouldalso be coordinating with Registrar to the Issue in attending to the grievances of the investors. The Company assures thatthe Board of Directors, in respect of the complaints, if any, to be received shall adhere to the following schedules:

Sr. No. Nature of Complaint Time Taken

1. Non-receipt of refunds Within 7 days of receipt of complaint, subject to production ofsatisfactory evidence.

2. Change of Address notification Within 7 days of receipt of Information

3. Any other complaint in relation to Public Issue Within 7 days of receipt of complaint with all relevant details

The Company has appointed Mr. Shashinand Nagori, as Compliance Officer who would directly deal with SEBI with respectto implementation /compliance of various laws, regulations and other directives issued by SEBI and matters related to investorComplaints. The investor may contact the Compliance Officer in case of any pre issue/post issue related problems. TheCompliance Officer can be contacted at the following address:

Bluplast Industries limited,113/114, Vivek Industrial Estate,Uswala Road,Near Litotier Cama Estate, Goregaon (East),Mumbai 400 063Tel : (022) 26851631Fax : (022) 26851151Email: [email protected]

Changes in Auditors during the Last Three Years and Reasons thereof

There is no change in the auditors in the last three years.

Capitalization of Reserves or Profits (during last five years)

The Company has not capitalized its profits or reserves at any time except as stated in the section titled “Financial Informationof the Company” on page no. 70 of this Prospectus.

Revaluation of Assets, if any (during last five years)

None of the assets of the Company have been revalued during last five years.

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TERMS OF THE ISSUE

Ranking of Equity Shares

The Equity Shares to be issued shall be subject to the provisions of the Companies Act, our Memorandum and Articles ofAssociation and shall rank pari passu in all respects with the existing Equity Shares of the Company including rights inrespect of dividends. The persons in receipt of Allotment will be entitled to dividend or any other corporate benefits, if any,declared by the Company after the date of Allotment.

Mode of payment of Dividend

The declaration and payment of dividend will be recommended by the Board of Directors of the Company and its shareholders,in their discretion, and will depend on a number of factors, including but not limited to the Company’s earnings, capitalrequirements and overall financial condition.

Face Value and Issue Price

The Equity Shares with a face value of Rs. 10/- each are being issued at the Price of Rs. 32 per Equity Share. The Issueprice is 3.2 times of the face value. At any given point of time there shall be only one denomination for the Equity Shares.

Rights of the Equity Shareholder

Subject to applicable laws, the equity shareholders shall have the following rights:

� Right to receive dividend, if declared;

� Right to attend general meetings and exercise voting powers, unless prohibited by law;

� Right to vote on a poll either in person or by proxy;

� Right to receive offers for right shares and be allotted bonus shares, if announced;

� Right to receive surplus on liquidation;

� Right of free transferability;

� Such other rights, as may be available to a shareholder of a listed Public Company under the Companies Act andthe Memorandum and Articles of Association of the Company.

For a detailed description of the main provisions of the Articles of Association of the Company dealing with voting rights,dividend, forfeiture and lien, transfer and transmission and/or consolidation/splitting, refer to the section on “Main Provisionsof Articles of Association of the Company” on page 119 of this Prospectus.

Market Lot and Trading Lot

In terms of Section 68B of the Companies Act, the Equity Shares of the Company shall be allotted only in dematerialisedform. As per existing SEBI Guidelines, the trading of our Equity Shares shall only be in dematerialised form for all investors.

Since trading of our Equity Shares is compulsorily in dematerialized mode, the tradable lot is One Equity Share. Allotmentthrough this Issue will be done only in electronic form in multiples of one (1) Equity Shares subject to a minimum allotmentof 200 Equity Shares.

Nomination Facility to the Investor

In accordance with Section 109A of the Act, the sole or first applicant, along with other joint applicants may nominate anyone person with whom, in the event of the death of the sole applicant or in case of joint applicants, death of all applicantsas the case may be, the Equity Shares allotted, if any, shall vest. A person, being a nominee, becoming entitled to the EquityShares by reason of death of the original holder(s), shall in accordance with Section 109A of the Act, be entitled to the sameadvantage to which he/she would be entitled if he/she were the registered holder of the Equity Shares. Where the nomineeis a minor, the holder(s) may make a nomination to appoint, in the prescribed manner, any person to become entitled toEquity Shares in the event of his or her death during the minority. A nomination shall stand rescinded upon a sale of equityshares by the person nominating. A buyer will be entitled to make a fresh nomination in the manner prescribed. Freshnomination can be made on a prescribed form available on request at the Registered Office of the Company or the Registrar.

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In accordance with Section 109B of the Act, any person who becomes a nominee by virtue of the provisions of the Section109A of the Act, shall upon production of such evidence as may be required by the Board, elect either:

a) To register himself or herself as holder of Equity Shares or

b) To make such transfer of the Equity Shares, as the deceased holder could have made.

Further, the Board may at any time give notice requiring any nominee to elect either to be registered himself or herself or totransfer the Equity Shares, and if the notice is not complied within a period of 90 days, Board may thereafter withhold paymentof all dividends, bonuses or other monies payable in respect of the equity shares, until the requirement of the notice havebeen complied with.

Minimum Subscription

If the Company does not receive the minimum subscription of 90% of the issued amount on the date of closure of the issue,or if the subscription level falls below 90% after the closure of the issue on account of cheques having been returned unpaidor withdrawal of applications, the Company shall forthwith refund the entire subscription amount received. If there is a delaybeyond eight (8) days after the Company becomes liable to pay the amount, the Company shall pay interest as per Section73 of the Companies Act, 1956.

Arrangement for Disposal of Odd Lots

The Company’s share will be traded in dematerialized form only and therefore marketable lot is one (1) share. Therefore,there is no possibility of odd lots.

Restrictions, if any, on Transfer and Transmission of Shares and on their Consolidation/Splitting

For the description in respect of restrictions, if any, on transfer and transmission of shares and on their consolidation/splitting,please refer sub-heading “Main Provisions of the Articles of Association of Bluplast Industries Limited” of this Prospectus.

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ISSUE PROCEDURE

Principal Terms and Conditions of the Issue

The Equity Shares, now being issued, are subject to the terms and conditions of this Prospectus, the Application Form, theMemorandum & Articles of Association of the Company, the guidelines for listing of securities issued by Government of Indiaand guidelines issued by SEBI from time to time, the Depositories Act and the provisions of the Act.

In addition, the Equity Shares shall also be subject to such other terms and conditions as may be incorporated in the letterof allotment, Share Certificates, as per guidelines, notifications and other regulations for the issue of capital and listing ofsecurities laid down from time to time by the Government of India and/or other authorities and other documents that may beexecuted in respect of the Equity Shares.

HOW TO APPLY

Availability of Prospectus and Application Forms

The Memorandum, Form 2A containing the salient features of the Prospectus together with Application Forms and copies ofthe Prospectus may be obtained from the Registered Office of the Company, Lead Managers to the Issue, Registrar to theIssue and the Bankers to the Issue named herein or from their branches as mentioned on the reverse of the ApplicationForm.

The prescribed colour of the application form for various categories, is as follows:

Category Colour of Application Form

For General Public White

For Permanent Employees of the Company Pink

Terms of Payment for All Categories

The application must be for a minimum of 200 equity shares and thereafter in multiples of 200 shares. The equity shares ofRs. 10/- each are issued at a price of Rs.32/- per equity share.

In case of allotment of lesser number of Equity Shares than the number applied, the excess amount paid on application shallbe adjusted against the amount payable on allotment and the balance, if any, shall be refunded by the Company to theapplicant.

Reservation

Reservation on the Competitive basis have been made in the Public Issue for:

Employees of the company – reservation on the competitive basis of 10,00,000 Equity Shares out of the Public Issue ismade for the permanent employees of the Company aggregating to 10% of the Public Issue made by the Company.

Unsubscribed portion in the reserved category may be added back to the net offer to the public.

Option to Subscribe

Except as otherwise stated in this Prospectus, the Company has not entered into, nor does it at present propose to enter intoany contract or arrangements whereby any option or preferential right of any kind has been or is proposed to be, given toany person to subscribe for any Equity Shares of the Company.

The Investor shall have an option either to hold the security certificates or to hold the securities in dematerialized form withthe depository.

WHO CAN APPLY

Applications to be made by

a. Indian Nationals resident of India who are majors in single or joint names (not more than three);

b. Hindu Undivided Families through the Karta of the Hindu Undivided Family;

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c. Companies, Bodies Corporate and Societies registered under the applicable laws in India and authorised to investin Equity Shares;

d. Indian Mutual Funds registered with SEBI;

e. Indian Financial Institutions & Banks;

f. Regional Rural Banks and Commercial Banks. Co-operative Banks may also apply subject to permission fromReserve Bank of India;

g. Venture Capital Funds registered with SEBI;

h. Foreign Venture Capital investors registered with SEBI;

i. State Industrial Development Corporations;

j. Insurance Companies registered with Insurance Regulatory and Development Authority;

k. Provident Funds with minimum corpus of Rs. 2500 Lakhs and who are authorized under their constitution to investin Equity Shares;

l. Pension Funds with minimum corpus of Rs. 2500 Lakhs and who are authorized under their constitution to investin Equity Shares;

m. Trusts/Societies who are registered under the Societies Registration Act, 1860, as amended, or any other Trust lawand are authorized under its constitution to hold and invest in shares;

n. Permanent and Regular employees of the Company;

o. Non-Resident Indians (NRIs) on a non-repatriable basis;

p. Foreign Institutional Investors (FIIs) registered with SEBI;

Applications not to be made by

a. Minors

b. Overseas Corporate Bodies (OCBs)

c. Foreign Nationals (except NRIs on non-repatriation basis)

d. Partnership firms or their nominees

Minimum and Maximum Application Size

1) For Retail Individual Investors: Application should be for a minimum of 200 Equity Shares and in multiples of 200Equity Shares thereafter, so as to ensure that the amount payable by the applicant does not exceed Rs. 1,00,000.

2) For Other Investors: Application should be for a minimum of such number of Equity Shares so that the amountpayable by the applicant exceeds Rs. 100,000 and in multiples of 200 Equity Shares thereafter. An applicant in thenet offer to public category cannot make an application for that number of Equity Shares exceeding the number ofEquity Shares offered to the public.

3) For Employees of the Company: Application should be for a minimum of 200 Equity Shares and in multiples of200 Equity Shares thereafter, with a maximum number of Equity Shares applied for not exceeding 10,00,000 EquityShares.

Subscription by NRIs/ FIIs

As per the extant policy of the Government of India, OCBs cannot participate in this Issue. Investments made by NRIs / FIIsare governed by the regulations contained in FEMA 20/2000-RB dated May 3, 2000 read with AP (DIR Series) Circular No.38 dated December 2, 2003 shall be applicable. It is to be distinctly understood that there is no reservation and separateApplication Form for NRIs on non-repatriation basis and FIIs registered with SEBI and all NRI (on non-repatriation basis) andFII applicants will be treated on the same basis with other categories for the purpose of allotment.

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Please note that:

� Individual NRI applicants can obtain the Application Forms from the registered office of the company at 113/114,Vivek Industrial Estate, Uswala Road, Near Litolier, Cama Estate, Goregaon (East), Mumbai-400063 or from theoffice of Lead Managers.

� NRI applicants may please note that only such applications as are accompanied by payment in free foreignexchange shall be considered for allotment. NRIs who intend to make payment through Non-Resident (NRO)accounts shall use the application forms meant for Resident Indians.

PROCEDURE FOR APPLICATION

Application by Permanent Employees

Reservation on competitive basis has been made in the public issue to the permanent employees. Reservation on competitivebasis shall mean reservation wherein allotment of shares is made in proportion to the shares applied for.

1. Application by Permanent Employees shall be made only in the prescribed Application Form (i.e. Pink colour formmarked “Employees”).

2. The sole/first applicant should be a Permanent Employee of the Company.

3. Only Permanent Employees and Directors of the Company as on the cut-off date i.e. March 31, 2006 would beeligible to apply in this Issue under reservation for Permanent Employees of the Company on competitive basis.

4. The Application must be for minimum of 200 Equity Shares and shall be in multiples of 200 Equity Sharesthereafter.

5. The maximum application size in this category can be of 10,00,000 Equity Shares.

6. If the number of shares applied for in this category is less than or equal to 10,00,000 Equity Shares, full allotmentshall be made to the Permanent Employees of the Company to the extent of their demand.

7. If the number of shares applied for in this category is greater than 10,00,000 Equity Shares, the allotment shall bemade on a proportionate basis subject to a minimum of 200 Equity Shares. For the method of proportionate basisof allotment, please refer paragraph “Basis of Allotment” on page 115 of this Prospectus.

A. GENERAL INSTRUCTIONS

1. Applications must be made in the prescribed Application Form and completed in Full in BLOCK LETTERS inEnglish as per the instructions contained herein and in the Application Forms and are liable to be rejected ifnot so made.

2. The application for Equity Shares should be for a minimum of 200 equity shares and in multiples of 200shares thereafter.

3. Thumb impressions and signatures other than in English/ Hindi or any other language specified in the 8th

Schedule to the Constitution of India, must be attested by a Magistrate or a Notary Public or a SpecialExecutive Magistrate under his/ her official seal.

4. Bank Account Details of Applicant:

The name of the Applicant, Depository Participant’s Identification (DPID) number and Beneficiary numberprovided by the Depository participant must be correctly mentioned in the Application Form at theappropriate place. The Registrar will obtain the Demographic details such as address, applicant’s BankAccount Details and occupation from the depository participants. The refund orders, if any, will beprinted with the Bank details as given by the Depository Participant.

5. Applications under Power of Attorney:

In case of applications under Powers of Attorney or by Companies, Bodies Corporate, Societies registeredunder the applicable laws, trustees of trusts, Provident Funds, Superannuation Funds, Gratuity Funds, acertified copy of the Power of Attorney or the relevant authority, as the case may be, must be lodged

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separately at the office of the Registrars to the Issue simultaneously with the submission of the ApplicationForm, indicating the serial number of the Application Form and the name of the Bank and the branch officewhere the application is submitted.

The Company in its absolute discretion, reserves the right to relax the above condition of simultaneouslodging of the power of attorney along with the Application Form subject to such terms and conditions as itmay deem fit.

6. PAN/ GIR Number

Where an application is for a total value of Rs. 50,000/- or more, the applicant or in case of applications injoint names, each of the applicants should mention his/ her/ their Permanent Account number (PAN) allottedunder Income Tax Act, 1961 or where the same has not been allotted, the GIR Number and the IT Circle/Ward/ District should be mentioned. The copy of the PAN Card or PAN Allotment Letter is required to besubmitted with application form. In case, where neither the PAN nor the GIR Number has been allotted, or theapplicant is not assessed to Income Tax, the appropriate box provided for the purpose in the application formmust be ticked. Applicants who do not have PAN are required to provide a declaration in Form 60 prescribedunder the I.T. Act along with the application. Applications without this will be considered incomplete and areliable to be rejected.

7. Joint Applications in the case of individuals

Applications can be in single or joint names (not more than three). In the case of joint applications, allpayments will be made out in favour of the first applicant. All communications will be addressed to the firstnamed applicant whose name appears in the Application form at the address mentioned therein.

8. Applications by Hindu Undivided Families

Applications may be made by Hindu Undivided Families (HUF) through the Karta of the HUF and will betreated at par with individual applications.

9. Multiple Applications

An applicant should submit only one Application Form (and not more than one) for the total number of EquityShares applied for. Two or more applications in single or joint names will be deemed to be multiple applicationsif the sole and/or first applicant is one and the same.

The Company reserves the right to accept or reject, in its absolute discretion, any or all multiple applications.

A separate single cheque/draft must accompany each Application Form.

10. Application By Mutual Funds

In case of application by Mutual Funds, a separate application can be made in respect of each scheme of anIndian Mutual Fund registered with SEBI and such applications will not be treated as multiple applicationsprovided that the application made by the Asset Management Company/ Trustees/ Custodian clearly indicatetheir intention as to the scheme for which the application has been made.

11. Stockinvest

Investors will not have facility of applying through stockinvest instrument in the issue as RBI has withdrawnthe stockinvest scheme vide notification No.DBOD.NO.FSC.BC.42/24.47.001/2033-04 dated November 5, 2003.

Note:

� Applicants are requested to write their names and serial number of the Application Form, on the reverse of theinstruments by which the payments are being made to avoid misuse of instruments submitted along with theapplications for Equity Shares.

� Applications by NRIs on non-repatriation basis can be made using the Form meant for Public out of the funds heldin Non Resident (Ordinary) Account (NRO). The relevant Bank Certificate must accompany such forms. Suchapplications will be treated on par with the applications made by the public.

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B. PAYMENT INSTRUCTIONS

1. Payment shall be made only by way of cash or cheque/ demand draft (money/ postal orders will not beaccepted) drawn on any Bank, including a co-operative Bank which is situated at and is a member or sub-member of the Banker’s clearing-house located at the place where the application form is submitted, i.e. atdesignated collection centers.

2. Outstation cheques/demand drafts drawn on Banks not participating in the clearing process will not be accepted.

3. All cheques/ demand drafts accompanying the Application Form :

i. For Indian Public: should be payable in the “Name of the Bank - A/c Bluplast– IPO” and crossed“Account payee only”. For e.g. “ Bank - A/c Bluplast– IPO”.

ii. For Permanent Employees of the Company under the reserved category: should be payable in the“Name of Bank - A/c Bluplast– IPO - Employees” and crossed “Account payee only”. For e.g. “ Bank - A/c Bluplast - IPO –Employees”.

4. If the amount payable on application is Rs. 20,000 or more, such payment must be effected only by way of anaccount payee cheque or Bank draft in terms of section 269SS of the Income-Tax Act, 1961. Otherwise theapplications may be rejected and application money refunded without any interest.

APPLICATIONS WHICH ARE NOT COMPLETE IN EVERY RESPECT OR ARE IN CONTRAVENTION OF ANYPROVISIONS/INSTRUCTIONS CONTAINED IN THIS PROSPECTUS OR IN THE MEMORANDUM CONTAINING SALIENTFEATURES OF PROSPECTUS ARE LIABLE TO BE REJECTED.

Grounds for Technical Rejections

Applicants are advised to note that applications are liable to be rejected on technical grounds, including the following:

a. Age is not mentioned.

b. Applications by minors.

c. PAN or GIR no. is not given, if the value of the application is for Rs. 50,000/- or more.

d. A copy of PAN Card or PAN Allotment letter or Form 60 / Form 61 declaration is not submitted alongwith applicationform having value for Rs. 50,000/- or more.

e. Multiple Applications.

f. In case of applications under power of attorney or by limited companies, corporate, trust etc., relevant documentsare not submitted.

g. An application accompanied by Stock invests.

h. Applications by OCBs.

i. Applications by NRIs on repatriation basis

j. Applications not duly signed by the sole/joint applicants.

k. Application forms do not have the applicant’s depository account details.

l. Application not for a minimum of 200 shares or multiples of 200 thereafter.

m. Application size exceeding the maximum size for the respective category.

n. Applications by any entity other than the retail individual investor mentioned under the para “Applications to bemade by” on page no. 110 of this Prospectus applying for the Equity Shares of the value of Rs. 1,00,000 or less.

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FOR FURTHER INSTRUCTIONS REGARDING THE APPLICATIONS FOR THE EQUITY SHARES, INVESTORS AREREQUESTED TO READ THE APPLICATION FORM CAREFULLY.

SUBMISSION OF COMPLETED APPLICATION FORMS

All applications duly completed and accompanied by cash/ cheques/ demand drafts shall be submitted at any of the branchesof the Bankers to the Issue (listed in the Application Form) before the closure of the Issue. Applications should NOT be sentto the Office of the Company or to the Lead Managers to the Issue.

The investors from the places other than from the places where the collection centers are located can also be send theirApplication Forms alongwith bank Drafts payable at Mumbai by registered post with acknowledgement due to the Registrarto the Issue, Bigshare Services Private Limited so that the same can be received before the closure of the subscription list.The envelope should be superscribed with the word “Bluplast IPO”.

No separate receipts will be issued for the application money. However, the Bankers to the Issue or their approved collectingbranches receiving the duly completed Application Form will acknowledge receipt of the application by stamping and returningto the applicant the acknowledgement slip at the bottom of each Application form.

Applications shall be deemed to have been received by the Company only when submitted to the Bankers to the Issue attheir designated branches or on receipt by the Registrars as detailed above and not otherwise.

For further instructions, please read the application form carefully.

ACCEPTANCE OF APPLICATIONS

The Company reserves the rights to accept or reject, any application, in whole or in part, without assigning any reasonsthereof. If the application is rejected in full, the whole of the application money received will be refunded by Electronic transferof funds or through Registered Post, Speed Post or UPC, as the case may be, to the applicant. If the Application Form isaccepted in part, the excess application money will be refunded to the Applicant. Such refund if any will carry interest @ 15%p.a. after 30 days from the closure of the Issue for the period of delay beyond 30 days.

BASIS OF ALLOTMENT

In the event of public issue of equity shares being over-subscribed, the allotment will be on a proportionate basis subjectminimum allotment being equal to the minimum application size, i.e. 200 shares as explained below:

1. A minimum 50% of the Net Issue to the public will be made available for allotment in favour of those individualapplicants who have applied for equity shares of or for a value not more than Rs. 100,000/-. This percentage maybe increased in consultation with the Designated Stock Exchange depending on the extent of response to the Issuefrom investors in this category. In case allotments are made to a lesser extent than 50% because of lower subscriptionin the above category, the balance Equity Shares would be added to the higher category and allotment made ona proportionate basis as per relevant SEBI Guidelines. The Executive Director/Managing Director of the DesignatedStock Exchange (BSE) along with the Lead Managers and the Registrars to the issue shall be responsible toensure that the basis of allotment is finalised in a fair and proper manner in accordance with the guidelines.

2. The balance of the Net Issue to the Public shall be made available to investors including corporate bodies/institutions and individual applicants who have applied for allotment of equity shares of or for a value of more thanRs. 1,00,000/-.

3. The unsubscribed portion of the net issue to any of the categories specified in (1) or (2) shall/may be madeavailable for allotment to applicants in the other category, if so required.

4. Applicants will be categorized according to the number of Equity Shares applied for.

5. The total number of shares to be allotted to each category as a whole shall be arrived at on a proportionate basisi.e. the total number of shares applied for in that category (number of applicants in the category multiplied by thenumber of shares applied for) multiplied by the inverse of the over subscription ratio.

6. All the Application Forms where the proportionate allotment works out to less than 200 shares per applicant, theallotment shall be made as follows:

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i. Each successful applicant shall be allotted a minimum of 200 shares; and

ii. The successful applicants out of the total applicants for that category shall be determined by draw of lots insuch a manner that the total number of shares allotted in that category is equal to the number of sharesworked out as per (5) above.

7 If the proportionate allotment to an applicant works out to a number that is more than 200 but is a fraction, then thefraction equal to or higher than 0.50 shall be rounded off to the next integer and if that fraction is lower than 0.50,the fraction shall be ignored. All applicants in such categories shall be allotted shares arrived at after such roundingoff.

8. If the shares allotted on a proportionate basis to any category is more than the shares allotted to the applicants inthat category, the balance available shares for allotment shall be first adjusted against any other category, wherethe allocated shares are not sufficient for proportionate allotment to the successful applicants in that category. Thebalance shares if any, remaining after such adjustment shall be added to the category comprising applicantsapplying for minimum number of shares.

9. An Over -Subscription to the extent of 10% of the net offer to the Public can be retained for the purpose of roundingoff to the nearest integer to a minimum allotment being equal to 200 which is the minimum application size in theissue, while finalizing the allotment.

LETTERS OF ALLOTMENT OR REFUND ORDERS

In accordance with the Companies Act, the requirements of the Stock Exchange and the SEBI Guidelines, the Companyundertakes that:

� Allotment of Equity Shares will be made within 30 days from the Issue closing date.

� Dispatch of refund orders or refund instructions to the clearing system will be done within 30 days from the Issueclosing date

� The Company shall pay interest at 15% per annum (for delay beyond 30 day time as mentioned above), if refundorders are not dispatched and/or demat credit are not made to investors or refund instructions have not been givento the clearing system in the disclosed manner within the 30 day time prescribed above.

The Company will provide adequate funds required for making refunds to unscessful applicants as per the mode disclosedunder “Dispatch of Refund Order” appearing on page no. 116 to the Registrar to the Issue.

Refunds will be made through electronic transfer of funds or by cheques or pay-orders drawn on the bank(s) appointed bythe Company, as refund banker(s). Such instruments will be payable at par at the places where applications are accepted.Bank charges, if any, for encashing such cheques or pay orders will be payable by the applicant.

DESPATCH OF REFUND ORDERS

The Company shall ensure dispatch of refund orders by following mode:

a) In case of applicants residing at Ahmedabad, Bangalore, Bhubnehwar, Kolkata, Chandigarh, Chennai, Guwahati,Hyderabad, Jaipur, Kanpur, Mumbai, Nagpur, New Delhi, Patna and Thiruvananthapuram – refunds shall be creditedthrough electronic transfer of funds by using ECS (Electronic Clearing Service), Direct Credit, RTGS (Real TimeGross Settlement) or NEFT (National Electronic Funds Transfer);

b) In case of applicants residing at places other than those specified in (a) above and where the value of refund orderis Rs 1500/- or more, refund orders will be dispatched to the applicants by registered post;

c) In case of applicants residing at places other than those specified in (a) above and where the value of refund orderis less than Rs. 1500/-, refund orders will be dispatched under certificate of posting.

INTEREST IN CASE OF DELAY IN DISPATCH OF ALLOTMENT LETTERS / REFUND ORDERS

The Company agrees that as far as possible allotment of Equity Shares offered to the public shall be made within 30 daysof the closure of Public Issue. The Company further agrees that it shall pay interest @15% per annum if the allotment letters/refund orders have not been dispatched to the applicants or if, in a case where the refund or portion thereof is made inelectronic manner, the refund instructions have not been given to the clearing system in the disclosed manner appearing onpage no. 116 within 30 days from the date of the closure of the Issue.

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EQUITY SHARE IN DEMATERIALISED FORM WITH NSDL OR CDSL

As per the provisions of Section 68B of the Companies Act, the Equity Shares of the Company can be held in a dematerializedform, (i.e. not in the form of physical certificates but be fungible and be represented by the statement issued through electronicmode).

In this context, two tripartite agreements have been signed between the company, the Registrar to the Issue and theDepositories:

1. an agreement dated March 2, 2006 between the Company, NSDL and Bigshare Services Private Limited and

2. an agreement dated January 2, 2006 between the Company, CDSL and Bigshare Services Private Limited

All investors can seek allotment only in dematerialised mode. However, an investor will have an option to hold the sharesin physical from or Demat form. After the allotment in the proposed issue, allottees may request their respective DPs for re-materialisation of shares, if they wish to hold shares in physical form. Applications without relevant details of his or herdepository account are liable to be rejected.

1. An applicant applying for shares must have at least one beneficiary account with any of the Depository Participants(DPs) of NSDL or of CDSL, registered with SEBI, prior to making the application.

2. The applicant must necessarily fill in the details (including the beneficiary account no. and Depository Participant’sID no.) in the application form.

3. Equity Shares allotted to an applicant in the electronic account will be credited directly to the respective beneficiaryaccounts (with the DP).

4. Names in the share application form should be identical to those appearing in the account details in the depository.In case of joint holders, the names should necessarily be in the same sequence as they appear in the accountdetails in the depository.

5. Non-transferable allocation letters/ refund orders will be directly sent to the applicant by the Registrar to this issue.

6. If incomplete/incorrect details are given under the heading ‘Applicants Depository Account Details’ in the applicationform, it is liable to rejected.

7. The applicant is responsible for the correctness of the applicant’s demographic details given in the application formvis-à-vis those with his/ her DP.

8. It may be noted that Equity Shares in electronic shares can be traded only on the Stock Exchanges havingelectronic connectivity with NSDL and CDSL. Both the Stock Exchanges where the Equity Shares of the Companyare proposed to be listed are connected to NSDL and CDSL.

9. Trading in the Equity Shares of the Company would be only in dematerialised form for all investors.

UNDERTAKING BY THE COMPANY

The Company undertakes:

a. that the complaints received in respect of the Issue shall be attended to by the Company expeditiously andsatisfactorily;

b. that all steps for completion of the necessary formalities for listing and commencement of trading at all stockexchanges where the securities issued are to be listed, are taken within 7 working days of finalisation of basis ofallotment.

c. that the funds required for making refunds to unscessful applicants as per the mode(s) disclosed shall be madeavailable to the Registrar to the Issue by the Company.

d. that where refunds are made through electronic transfer of funds, a suitable communication shall be sent to theapplicant within 30 days of closure of the issue, giving details of the bank where refunds shall be credited alongwith the amount and expected date of electronic credit of refund.

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e. that the promoters’ contribution in full, wherever required, shall be brought in advance before the Issue opens forpublic subscription and the balance, if any, shall be brought in pro rata basis before the calls are made on public.

f. that the Certificates of the Equity Shares/Refund Orders to the NRI applicants shall be dispatched within specifiedtime.

g. that no further issue of securities shall be made till the Equity Shares offered through this Prospectus are listed ortill the application moneys are refunded on account of non-listing , undersubscription etc.

UTILISATION OF ISSUE PROCEEDS

The Board certifies that:

a. All monies received out of the issue of Equity Shares to the public shall be transferred to a separate Bank Accountother than the Bank Account referred to in Sub-section (3) of section 73 of the Act, 1956;

b. Details of all monies utilized out of this issue referred to in item (a) shall be disclosed under an appropriateseparate head in the Balance Sheet of the Company indicating the purpose for which such monies had beenutilized;

c. Details of all unutilized monies out of this Issue of shares, if any referred to in item (a) shall be disclosed under anappropriate head in the balance sheet of the Company indicating the manner in which such unutilized monies havebeen invested.

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CAPITAL

3. A. The minimum Authorised Share Capital of the Company is Rs. 5,00,000 (RupeesFive Lakh only) divided into 50,000 (Fifty Thousand) Equity Shares of Rs. 10/-(Rupees Ten Only) each.The authorized share capital of the company shall bethe capital as specified in Clause V of the Memorandum of Association, withpower to increase or reduce the share capital of the Company and to divide theshares in the capital for the time being into several classes as permissible inlaw and to attach thereto respectively such preferential, deferred, qualified orspecial rights, privileges or conditions as may be determined by or in accordancewith the Articles of Association of the Company and to vary, modify, amalgamateor abrotage any of such rights, privileges or conditions in such manner as mayfor the time being be provided in the Articles of Association.

4. Subject to the applicable provision of the Companies Act, 1956 and all otherapplicable provisions of law (including any statutory modifications or re-enactmentthereof for the time being in force or as may be enacted from time to time) andsubject to such other approvals/permissions or sanctions as may be necessary,the Company may issue shares with non-voting rights upon such terms andconditions and with such rights and privileges (including with regard to dividend)as may be permitted by law or guidelines issued by the statutory authorities and/or listing requirements and that the provisions of these Articles of Association, tothe extent they are concerning or relating to voting rights of shares shall not beapplicable to the aforesaid non-voting shares, if any, issued by the Company.

5. The Company in General Meeting may from time to time by Ordinary Resolutionincrease the capital by the creation of new shares, the increases to be of suchaggregate amount and to be divided into Shares of such respective amounts asthe Resolution shall prescribe, subject to the provisions of the Act, any shares ofthe original or increased capital shall be issued upon such terms and conditionsand with such rights and privileges annexed thereto as the General Meetingresolving upon the creation thereof, shall direct, and if no direction be given, asthe Directors shall determine, and in particular, such shares may be issued witha preferential or a qualified right to dividends, and in the distribution of the assetsof the Company in conformity with Section 87 and 88 of the Act. Whenever thecapital of the Company has been increased under the provisions of this Article,the Directors shall comply with the provisions of Section 97 of the Act.

7. Subject to the provisions of Sections 80 and 80A of the Act, the Company shallhave the power to issue Preference Shares, which are at the option of theCompany liable to the redeemed, and the resolution authorising such issue shallprescribe the manner, terms and conditions of redemption.

8. The holder of Preference Shares shall have a right to vote only on Resolutions,which directly affect the rights attached to his Preference Shares.

10. The Company may from time to time by Special Resolution, subject to theprovisions of Section 78, 80, 100 to 104 inclusive of the Act, reduce its ShareCapital and any Capital Redemption Reserve Account or Share Premium Accountin any manner for the time being authorised by law.

MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION

Pursuant to Schedule II of the Companies Act, 1956 and the SEBI Guidelines, the main provisions of our Articles of Associationare detailed below. Please note that each provision below is numbered as per the corresponding Article number in ourArticles of Association.

Authorised Capital

Non Voting Shares

Increase in Capital

Redeemable preferenceShares

Voting rights of preferenceshares

Reduction of Capital

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11. A. The Company in general meeting may subject to the provisions of Section 94 ofthe Act by Ordinary Resolution alter the conditions of its Memorandum.

12. B. Subject to and in accordance with the applicable provisions of the CompaniesAct, 1956 and all other applicable provisions of law (including any statutorymodification or re-enactment thereof for the time being in force or as may beenacted from time to time) and subject to such other approvals/permissions orsanctions as may be required, the Company shall have power to acquire,purchase, sell, dispose off, provide finance for the purchase of any of its ownfully/ partly paid shares whether or no they are redeemable and to make thepayment out of Capital Reserves or otherwise in respect of such acquisition,purchase, financing.

SHARES AND CERTIFICATES

14. The Company shall cause to be kept a Register and Index of Members inaccordance with all applicable provisions of the Act and the Depositories Act,1996 with details of shares held in material and dematerialized forms in anymedias may be permitted by law including in any form of electronic media. TheCompany shall be entitled to keep in any State or Country outside India a branchRegister of Members resident in the State or country.

21. Any application signed by or on behalf of a applicant for shares in the Company,followed by an allotment of any share therein, shall be an acceptance of shareswithin the meaning of these Articles, and every person who thus or otherwiseaccepts any shares and whose name is on the Register shall, for the purposesof these Articles, be a Member.

23. Every Member, or his heirs, executors or administrators, shall pay to the Companythe portion of the capital represented by his share or shares which may for thetime being, remain unpaid thereon, in such amounts at such time or times insuch manner as the Board shall from time to time in accordance with theCompany’s regulations, require or fix for the payment thereof.

24. a) Every Member of allottee of shares shall be entitled without payment, to receiveone certificate specifying the name of the person in whose favour it is issued,the shares to which it relates and the amount paid-up thereon.Provided however, that no share certificate (s) shall be issued in respect of theshares held in Depository.

c) If a share certificate is lost or destroyed, a new certificate in lieu thereof shall beissued only with the prior consent of the Board and on such terms, if any, as toevidence and indemnity as to the payment of out-of pocket expenses incurredby the Company in investigating evidence, as the Board thinks fit.

27. B. The Company shall be entitled to dematerialise its existing shares, debenturesand other securities, rematerialise its shares, debentures and other securitiesheld in the Depositories and/or to issue its fresh shares, debentures and othersecurities, in a dematerialised form pursuant to the Depositories Act, 1996 andthe rules framed there under, if any.

31. Except as provided in these Articles, none of the funds of the Company shall beapplied in the purchase of, or land on the security of shares of the Companyand the Company shall not, except as permitted by Section 77 of the Act, giveany financial assistance for the purpose of or in connection with any purchaseof shares in the Company.Nothing in this Article shall affect the right of the Company to redeem any sharesissued under Section 80 of the Act.

Sub-division, consolidationand cancellation of shares

Register and Index ofMembers

Acceptance of shares

Liability of members

Share Certificate

Dematerialisation andRematerialisation ofSecurities

Funds of Company may notbe applied in purchase ofthe shares of Company

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33. DEMATERIALISATION OF SECURITIES

b) Notwithstanding anything contained in these Articles, the Company shall beentitled to dematerialise its securities and to offer securities in a Company in adematerialised form pursuant to the Depositories Act, 1996.

c) Every person subscribing to securities offered by the Company shall have theoption to receive security certificate or to hold the securities with a depository.Such a person who is the beneficial owner of the securities can at any time optout of a depository, if permitted by the law, in respect of any security in themanner provided by the Depositories Act, and the Company shall, in the mannerand within the time prescribed, issue to the beneficial owner the requiredCertificate of Securities.If a person opts to hold his security with a depository, the Company shall intimatesuch depository the details of allotment of the security, and on receipt of theinformation, the depository shall enter in its record the name of the allottees asthe beneficial owner of the security.

d) All securities held by a depository shall be dematerialised and be in fungibleform. Nothing contained in Section 153, 153A, 153B, 187B, 187C and 372 ofthe Act shall apply to a depository in respect of the securities held by it on behalfof the beneficial owners.

e) (c) Every person holding securities of the Company and whose name is enteredas the beneficial owner in the records of the depository shall be deemed to bea member of the Company. The beneficial owner of securities shall be entitledto all the rights and benefits and be subject to all the liabilities in respect of hissecurities which are held by a depository.

g) Nothing contained in section 108 of the Act or these Articles shall apply to atransfer of securities effected by a transferor and transferee both of whom areentered as beneficial owners in the records of a depository.

h) Notwithstanding anything in the Act or these Articles, where securities dealt withby a depository, the Company shall intimate the details thereof to the depositoryimmediately on allotment of such securities.

34. In the event it is permitted by law to issue shares without voting rights attachedto them, the Directors may issue such share upon such terms and conditionsand with such rights and privileges annexed thereto as thought fit and as maybe permitted by law.

35. Notwithstanding anything contained in these articles, in the event it is permittedby law for a Company to purchase its own shares or securities, the Board ofDirectors may, when and if thought fit, buy back, such of the Company’s ownshares or securities as it may think necessary, subject to such limits, upon suchterms and conditions, and subject to such approvals, as may be permitted bylaw.

CALLS

42. The Board may, from time to time, subject to the terms on which any shares mayhave been issued and subject to the conditions of allotment, by a resolutionpassed at a meeting to the condition of allotment by a resolution passed at ameeting of the Board (and not by circular resolution) make such call as it thinksfit upon the Members in respect of all moneys unpaid on the shares held bythem respectively and such Member shall pay the amount of every call so madeon him to the person or persons and at the time and places appointed by theBoard. A call may be made payable by installments.

Dematerialisation ofSecurities

Option for Investors

Securities to be in FungibleForm

Rights of the Depositoriesand the Beneficial Owners

Transfer of Securities

Allotment of Securitiesdealt with a Depository

Issue of Shares withoutVoting Rights

Buy-Back of Shares andSecurities

Directors may make calls

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44. A call shall be deemed to have been made at the time when the resolutionauthorizing such call was passed at the meeting of the Board.

45. A call may be revoked or postponed at the discretion of the Board.

46. The joint-holders of any share shall be jointly and severally liable in respect ofall calls or installments and other payment, which ought to me made in respectof such shares.

47. The Board may from time to time at its discretion, extend the time fixed for thepayment of any call and may extend such time as to all or any of the Memberswho from residence at a distance or other cause, the Board may deem fairlyentitled to such extension but no Member shall be entitled to such extensionsave as a matter of grace and favor.

49. Any sum, which by the terms of issue of a share becomes payable on allotmentor at any time fixed date, whether on account of the nominal value of the shareor by way of premium shall for the purposes of these Articles be deemed to bea call duly made and payable on the date on which by the terms of issue thesame becomes payable, and in case of non-payment of such sum all the relevantprovisions of these Articles as to payment of interest and expenses, forfeiture orotherwise shall apply as if such sum had become payable by virtue of call dulymade and notified.

51. Neither a judgment nor a decree in favor of the Company for calls or othermoneys due in respect of any shares nor any payment or satisfaction thereofnor the receipt by the Company of a portion of any which shall from time to timebe due from any member in respect of any shares either by way of principal ofinterest nor any indulgence granted by the Company in respect of payment ofany such money shall preclude the forfeiture of such shares as herein provided.

52. a) The Board may, if it thinks fit, agree to and receive from any Member willing toadvance the same, all or any part of the amount of his shares beyond the sums,actually called up and upon the moneys so paid in advance or upon so muchthereof from time to time and at any time thereafter as exceeds the amount ofthe calls then made upon and due in respect of the shares on account of whichsuch advances are made the Board may pay or allow interest at such rate (notexceeding without the sanction of the Company in General Meeting up to fourteenper cent per annum) as the member paying the sum in advance and the Boardagree to repay at any time any amount so advanced or may at any time repaythe same upon giving to the Member three months notice in writing providedthat moneys paid in advance of calls shall not confer the right to dividend/s or toparticipate in profits.

b) No Member paying any such sum in advance shall be entitled to voting rights inrespect of the moneys so paid by him until the same would but for such paymentsbecome presently payable.

c) Advance payment made against future calls shall not be constructed depositswithin the meaning of Companies (Acceptance of deposits) Rules, 1975.

d) Payment made in advance against calls shall be credited in the member’saccount and it shall carry interest at the rate, which may be prescribed by theBoard from the date of payment up to the date of calls, or call, which may bemade by the Board from time to time.

Calls to date fromresolution

Call may be revoked orpostponed

Liability of joint holders

Directors may extend time

Sums deemed to be calls

Partial payment not topreclude forfeiture

Payment in anticipation ofcalls may carry interest

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53. A. Any calls for future share capital are made on shares such calls shall be madeon a uniform basis on all shares falling under the same class. For the purposeof this Article, shares of the same nominal value on which different amount havebeen paid up shall not be deemed to fall under the same class.

B. If by the condition of allotment for any shares the whole or part of the amount ofissue price thereof shall be payable by installments every such installment shall,when due be paid to the Company by the person who, for the time being andfrom time to time shall be registered holder of the share or his legal representative.

LIEN

54. The Company shall have a first and paramount lien upon all the shares (otherthan fully paid up shares) registered in the name of each Member (whether solelyor jointly with others) and upon the proceeds of sale thereof, for all moneys(Whether presently payable or not) called or payable at a fixed time in respect ofsuch shares, and no equitable interest in any shares shall be created exceptupon the footing and upon the condition that Article 30 hereof is to have fulleffect. Any such lien shall extend to all dividends from time to time declared inrespect of such shares. Unless otherwise agreed the registration of a transfer ofshares shall operate as a waiver of the Company’s lien, if any, on such shares.Provided that the Board Directors may at any time declare any shares wholly orin part to be exempt from the provisions of this clause.

56. For the purpose of enforcing such lien the Board may sell the shares subjecthereto in such manner as they shall think fit, and for that purpose may cause tobe issued a duplicate certificate in respect of such shares and may authorizeone of their members to execute a transfer thereof on behalf of and in the nameof such Member. No sale shall be made until such period as aforesaid shallhave arrived, and until notice in writing of the intention to sell shall have beenserved on such Member or his representatives and default shall have been madeby him or them in payment, fulfillment, or discharge of such debts, liabilities orengagements for fourteen days after such notice.

57. (a) To give effect to any such sale, the Board may authorize some person to transferthe shares sold to the purchase thereof.

(b) The purchaser shall be registered as the holder of the shares comprised in anysuch transfer.

(c) The purchaser shall not be bound to see to the application of the purchasemoney, nor shall his title to the shares be affected by any irregularity or invalidityin the proceedings in reference to the same

58. The net proceeds of any such sale shall be received by the Company and appliedin or towards payment of such part of the amount in respect of which the lienexists as is presently payable and the residue, if any, shall (subject to a like forsums not presently payable as existed upon the shares before the sale) be paidto person entitled to the shares at the date of the sale.

FORFEITURE AND SURRENDER OF SHARE

59. If any Member fails to pay the whole or any part of any call or installments or anymoney due in respect of any shares either by way of principal or interest on orbefore the day appointed for the payment of the same or any such extensionthereof as aforesaid, the Directors may at any time thereafter, during such timeas the call or installment or any part thereof or the other moneys remain unpaidor a judgment or decree in respect thereof remains unsatisfied in whole or in

Calls on shares of sameclass to be made onuniform basis

Installment on shares to beduly paid

Company to have lien onshares

As to enforcing lien bysale.

Transfer of share soldunder lien

Application of proceeds ofsales

If money payable onshares not paid notice to begiven to member

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part, send a notice on such Member or on the person (if any) entitled to theshare by transmission, requiring him to pay such call or installment or such partthereof or other moneys as remain unpaid together with any interest that mayhave accrued and all expenses that may have been incurred by the Companyby reason of such non-payment.

60. The notice shall name a day (not being less that fourteen days from the date ofthe notice) and a place or places on and at which such calls or installments andsuch interest thereon at such rate not exceeding 18 percent per annum as theDirectors shall determine from the day on which such call or installment ought tohave been paid and expenses as aforesaid are to the paid. The notice shallalso state that, in the event of the non-payment at or before the time and at theplace appointed, the shares in respect of which the calls was made or installmentis payable, will be liable to be forfeited.

61. If the requirements of any such notice as aforesaid shall not be complied with,every or any share in respect of which, such notice has been given, may at anytime thereafter before payment of all calls or installments, Interest and expensesdue in respect thereof be forfeited by a ordinary resolution of the Board to thateffect. Such forfeiture shall include all dividends declared or any other moneyspayable in respect of the forfeited shares and not actually paid before the dateof forfeiture which shall be the date on which the ordinary resolution of theDirectors is passed forfeiting the shares.

62. When any share shall have been so forfeited notice of the forfeiture shall begiven to the Member in whose name it stood immediately prior to the forfeiture,and an entry of the forfeiture, with the date thereof, shall forthwith be made inthe Register of Members, but no forfeiture shall be in any manner invalidated byany omission or neglect to give such notice or to make any such entry asaforesaid.

63. Any share so forfeited shall be deemed to be the property of the Company, andmay be sold, re-allotted, or otherwise disposed of, either to the original holderthereof or to any other person, upon such terms and in such manner as the Boardshall think fit and at any time before a sale or disposal as aforesaid the boardmay cancel the forfeiture on such terms as it thinks fit.

64. Upon forfeiture of shares, the member shall forthwith forfeit the shares to theCompany.

65. Any member whose shares have been forfeited shall cease to be a member inrespect of those shares but shall notwithstanding the forfeiture be liable to payand shall forthwith pay to the Company, on demand all calls, installments, interestand expenses owing upon or in respect f such shares at the time of the forfeituretogether with interest thereon from the time of the forfeiture until payment, at suchrate not exceeding eighteen percent per annum or as the Board may determineand the Board may enforce the payment thereof, if it thinks fit.

66. The forfeiture of a share shall involve extinction, at the time of the forfeiture, ofall interest in and all claims and demand against the Company, in respect of theshare and all other rights incidental to the share, except only such of those rightsas by these Articles are expressly saved.

67. A declaration in writing that the declarant is a Director or Secretary of theCompany and that a share in the Company has been duly forfeited in accordancewith these Articles on a date state in the declaration, shall be conclusive evidenceof the facts therein stated as against all persons claiming to be entitled to theshares.

Form of Notice

In default of paymentshares to be forfeited

Notice of Forfeiture toMember

Forfeited share to beproperty of the Companyand may be sold etc.

Surrender of forfeitedshares

Liability on forfeiture

Effect of forfeiture

Evidence of forfeiture

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68. Upon any sale after forfeiture or for enforcing a lien in purported exercise of thepowers therein before given, the Board may appoint some person to execute aninstrument of transfer of the shares sold and cause the Purchaser’s name to beentered in the Register in respect of the shares sold, and the purchaser shallnot be bound to see to the regularity of the proceedings, or to the application ofthe purchase money, and after his name has been entered in the Register inrespect of such shares, the validity of the sale shall not be impeached by anyperson and the remedy of any person aggrieved by the sale shall be in damagesonly and against the Company exclusively.

69. Upon any sale, re-allotment or other disposal under the provisions of thepreceding Articles, the certificate or certificates originally issued in respect of therelative shares shall (unless the same shall on demand by the Company havebeen previously surrendered to it by the defaulting Member) stand cancelledand become null and void and of no effect, and the Directors shall be entitled toissue a duplicate certificate or certificates in respect of the said shares to theperson or persons entitled thereto distinguishing it on them in such manner asthey think fit from the certificates not so delivered.

70. The Board may at any time before any share so forfeited shall have been sold,re-allotted or otherwise disposed of, annul the forfeiture thereof upon suchconditions as it thinks fit.

71. The Directors may subject to the provisions of the Act, accept a surrender of anyshare or by any member desirous of surrendering on such terms as the Directorsmay think fit.

72. The provisions of the Articles under this chapter to the extent applicable, shallmutates mutandis apply to debentures of the Company.

TRANSFER AND TRANSMISSION OF SHARES

73. The Company shall keep a book to be called “Register of Transfer”, and thereinshall be fairly and distinctly entered particulars of every transfer or transmissionof any share held in material form.

74. Shares in the Company may be transferred by instrument in writing in such formand by such procedure as may from time to time be prescribed by law. Subjectthereto the directors may prescribe a common form of for instruments of transferwhich may from time to time be altered by the Directors.

75. In the case of transfer of shares/debentures held by joint holders, the transferwill be effective only if it is made by all the joint holders.

76. The Instrument of Transfer duly stamped and executed by the transferor and thetransferee shall be delivered to the Company in accordance with the provisionsof the Act.

81. Subject to Article 30 hereof in the case of the death of any one or more of thepersons named in the Register of Members as the joint-holders of any shares,the survivor or survivors shall be the only persons recognised by the Companyas having any title to or interest in such shares, but nothing herein containedshall be taken to release the estate of a deceased joint-holder from any liabilitieson shares held by him jointly with any other person.

83. A holder or joint holders of shares in or debentures of the Company maynominate, in accordance with the provisions of Section 109A of the CompaniesAct, 1956 (including any amendment thereto or any re-enactment thereof) andin the manner prescribed there under, any person to whom all the rights in the

Validity of Sale under theseArticles

Cancellation of sharecertificate in respect offorfeited shares

Power to annul forfeiture

Surrender of shares

Provisions to apply todebentures also

Register of Transfer

Instrument of Transfer

Transfer by Joint Holders

Transfer form to becompleted and Presentedto the Company

Death of one or more Jointholders of shares

Nomination

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shares in or debentures of the Company shall vest in the event of death of suchholder (s). Any nomination so made shall be dealt with by the Company inaccordance Act,1956 or any statutory modification or re-enactment thereof forthe time being in force.

93. In the case of transfer or transmission of shares or other marketable securitieswhere the Company has not issued any certificates and where such shares orsecurities are being held in an electronic and fungible form in a Depository, theprovisions of the Depositories Act,1996 shall apply.

COPIES OF MEMORANDUM AND ARTICLES TO BE SENT TO MEMBERS

95. Copies of the Memorandum and Articles of Association of the Company andother documents referred to in Section 39 of the Act as in force for the time being,shall be sent/furnished to every Member at his request within seven days of therequest on payment of prescribed fees.

BORROWING POWER

96. Subject to the provisions of Section 58A, 292 and 293 of the Act and of theCompanies (Acceptance of Deposits) Rules, 1975 and of these Articles or anystatutory modification thereof for the time being in force the Board may, fromtime to time at its discretion by a resolution passed at a meeting of the Board,accept deposits from Members either in advance of calls or otherwise andgenerally raise or borrow or secure the payment of any sum or sums of moneyfor the purpose of the Company. Provided the payment of any sum or sums ofmoney for the purpose of the Company. Provided however where the moneys tobe borrowed together with the moneys already borrowed (apart from temporaryloans to be obtained from the Company’s bankers in the ordinary course ofbusiness) exceed the aggregate of the paid up capital of the Company and its,free reserves (not being reserves set apart for any specific purpose) the Boardof Directors shall not borrow such money without the sanction of the Companyin General Meeting. No Debt incurred by the Company in excess of the limitimposed by these Articles shall be valid or effectual unless the lender provesthat he advances the loan in good faith and without knowledge that the limitimposed by this Article had been exceeded.

101. The Board shall cause a proper Register to be kept in accordance with theprovisions of Section 143 of the Act of all mortgages, debentures and chargedspecifically affecting the property of the Company and shall cause therequirements of Section 118, 125 and 127 to 144 of the Act in that behalf to beduly complied with, (within the time prescribed by the said section or suchextension thereof as may be permitted by the Company Law Board or the Courtor the Registrar of Companies as the case may be) so far as they feel to becomplied with by the Board.

102. If any uncalled up capital of the Company is included in or charged by anymortgage or other security, the Directors shall, subject to the provisions of theAct and these Articles, make calls on the Members in respect of such uncalledup capital in trust for the person in whose favor such mortgage or security isexecuted or if permitted by the Act, may by instrument under the seal authorizethe person in whose favor such mortgage or security is executed or any otherperson in trust for him to make calls on the Members in respect of such uncalledup capital and the provisions hereinbefore contained in regard to calls shallmutants mutandis apply to calls made under such authority and such authoritymay be made exercisable either conditionally or unconditionally and either tothe exclusion or the Director’s power or otherwise and shall be assignable ifexpressed so to be.

Transfer of shares inDematerialised form

Copies of Memorandumand Articles to be sent bythe Company

Powers to borrow

Register of mortgage etc.to be kept

Mortgage of un called upcapital

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MEETING OF MEMBERS

113. The Statutory Meeting of the Company, shall as required by Section 165 of theAct, be held at such time not being less than one month and not more than sixmonths from the date at which the Company shall be entitled to commencebusiness and at such place as the Board may determine, and the Board shallcomply with the requirements of that Section, as to the report to be submittedand otherwise.

114. The Company shall in each year hold a General Meeting as its Annual GeneralMeeting in addition to any other meetings in that year. All General Meetings otherthan Annual General Meeting and the Statutory Meeting shall be calledExtraordinary General Meetings. The First Annual General Meeting shall be heldwithin eighteen months from the date of incorporation of the Company and thenext Annual General Meeting shall be held within six months after the expiry ofthe financial year in which the first Annual General Meeting was held andthereafter an Annual General Meeting of the Company shall be held within sixmonths after the expiry of each financial year.

115. a) Section 171 to 175 and Sections 177 to 186 of the Act with such adaptationsand modifications, if any, as may be prescribed shall apply with respect tomeetings of any class of members or of debenture holders or any class ofdebenture holders of the Company in like manner as they apply with respect toGeneral Meeting of the Company.

b) Section 176 of the Act with such adaptations and modifications if any, as may beprescribed shall apply with respect to meetings of any class of members or ofdebenture holders of the Company in like manner as it applies with respect toGeneral Meeting.

118. Every notice of a meeting of the Company shall specify the place, day and hourof the meeting and shall contain a statement of the business to be transactedtherat.

119. Where by any provision contained in this Act or in these Articles, special noticeis required of any resolution, notice in respect of the same shall be given asprovided in Section 190 of the Act.

121. When a meeting is adjourned for thirty days or more, notice of the adjournedmeeting shall be given as in the case of an original meeting. Save as aforesaidit shall not be necessary to give any notice of the adjournment or of the businessto be transacted at an adjourned meeting.

123. Any valid requisition so made by Members must state the object or objects ofthe meeting proposed to be called and must be signed by the requisitionistsand be deposited at the Office, provided that such requisition may consist ofseveral documents in like form each signed by one or more requisitionists.

126. The Directors shall on the requisition of members representing not less thanone-twentieth of the voting rights of members having a right to vote at any AnnualGeneral Meeting or being not less than one hundred members holding shareson which there has been paid up an aggregate sum of not less than one lakh ofrupees in all, give notice to the members of any resolution which can properlybe moved and intended to be moved a the meeting and circulate any statementsupplied by the requisitionsists in accordance with the requirements of Section188 of the Act with which the Company shall also comply.

The Statutory Meeting

Annual General Meeting

Section 171 to 186 of theAct shall apply to Meeting

Contents of Notice

Resolutions requiringSpecial Notice

Notice to be given where aMeeting is adjourned for 30days or more

Requisition of Members tostate object of Meeting

Circulation of Member’sResolution

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130. At least Twenty-one days notice of every General Meeting, Annual or ExtraordinaryGeneral Meeting, and by whomsoever called specifying the day, place and hourof meeting and the general nature of the business to be transacted threat, shallbe given in the manner hereinafter provided, to such persons as are under theseArticles entitled to receive notice from the Company. Provided that in the case ofan Annual General Meeting with the consent in writing of all the Members entitledto vote thereat and in case of any other meetings, with the consent of Membersholding not less than 95 percent of such part of the paid-up share capital of theCompany as gives a right to vote at the meeting, a meeting may be convenedby a shorter notice.

131. The accidental omission to give any such notice as aforesaid to any of themembers, or the non-receipt thereof, shall not invalidate any resolution passedat or the proceedings of any such meeting.

132. No General Meeting, Annual or Extraordinary General Meeting, shall becompetent to enter upon, discuss or transact any business which has not beenmentioned in the notice or notices upon which it was convened.

134. The Directors may in their absolute discretion on giving not less than seven cleardays notice in accordance with these Articles, postpone or cancel any meetingof members, except a meeting called pursuant to a member’s requisition.

135. Five Members present in person shall be the quorum for a General Meeting.

143. a) Before or on the declaration of the result of the voting on any resolution on ashow of hands, a poll may be ordered to be taken by the Chairman of the meetingof his own motion and shall be ordered to be taken by him on a demand madein that behalf in the manner mentioned in Section 179 of the Act.

b) The demand for a poll may be withdrawn at any time by the person or personswho made the demand.

c) A poll demand on a question of adjournment and on the question relation to theelection of the Chairman which is provided in Section 175 of the Act, shall betaken forthwith.

d) A poll demanded on a question shall be taken at such time not being later than48 (Forty-eight) hours from the time when the demand was made, as theChairman may direct.

e) Subject to the provisions of the Act, the Chairman of the Meeting shall havepowers to regulate the manner in which a poll shall be taken.

f) The result of the poll shall be deemed to be decision of the meeting on theresolution on which poll was taken.

144. Where a poll is to be taken, the Chairman of the meeting shall appoint twoscrutineers to scrutinse the votes cast at the poll and to report thereon to him.One of the scrutineers so appointed shall always be a Member (not being anofficer or employee of the Company) present at the meeting, provided such amember is available and willing to be appointed. The Chairman shall have powerat any time before the result of the poll is declared to remove a scrutineer fromoffice and fill vacancies in the office of scrutineer arising from such removal orfrom any other cause.

145. Any poll duly demanded on the election of a Chairman of a meeting or on anyquestion of adjournment shall be taken at the meeting forthwith.

Twenty-one days notice ofmeeting to be given

Omission to give notice notto invalidate a resolutionpassed

Meeting not to transactbusiness not mentioned innotice

Postponement orcancellation of meeting

Quorum at General Meeting

Poll to be taken ifdemanded

Scrutineers at Poll

In what case poll takenwithout adjournment

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146. The demand for a poll, except on the question of the election of the Chairmanand of an adjournment, shall not prevent the continuance of meeting for thetransaction of any business other than the question on which the poll has beendemanded.

VOTES OF MEMBERS

147. No Member shall be entitled in respect of any shares registered in his name tobe present or to exercise any voting right on any question at any General Meetingor be reckoned in a quorum whilst any call or other sum presently payable tothe Company in respect of such shares, shall remain unpaid or in regard to whichthe Company has exercised any right of lien; and no member shall be entitled tobe present or to vote in respect of any shares that he has acquired by transfer atany meeting unless his name has been entered as the registered holder of suchshare in respect of which he claims to vote.

148. Any shareholder whose name is entered in the Register of Members of theCompany shall enjoy the same rights and be subject to the same liabilities asall other shareholders of the same class.

149. Subject to the provisions of these Articles and without prejudice to any specialprivileges or restrictions as to voting for the time being attached to any class ofshares for the time being forming part of the capital of the Company, everymember, not disqualified by the last preceding Article shall be entitled to bepresent and to speak and vote at such meeting, and on a show of hands everyMember present in person or by proxy shall have one vote and upon a poll thevoting right of every Member present in person or by proxy shall be in proportionto his share of the paid-up equity share capital of the Company. Provided,however if any preference Shareholder be present at any meeting of theCompany, save as provided in clause (b) of sub-section (2) of Section 87, heshall have a right to vote only on resolutions placed before the meeting whichdirectly affect the rights attached to his preference shares.

150. On a poll taken at a meeting of the Company a Member entitled to more thanone vote or his proxy or other person entitled to vote for him, as the case maybe, need not, if he votes, use all his votes or cast in the same way all the voteshe uses.

152. If there be joint registered holders of any shares, any one of such persons mayvote at any meeting either personally or may appoint another person (whether aMember or not) as his proxy in respect of such shares, as if he were solely entitledthereto but the proxy so appointed shall not have any right to speak at the meetingthat one of the said person so present whose name stands higher on the registershall alone be entitled to speak and to vote in respect of such shares, but theother or others of the joint holders shall be entitled to be present at the meeting.Several executors or administrators of a deceased Member in whose namesshares stand for the purpose of these Articles be deemed as joint holders thereof.

153. Any member of the Company entitled to attend and vote at a meeting of theCompany shall be entitled to appoint any other person (whether a member ornot) as his proxy to attend and vote instead of himself. A member (and in caseof joint holders all holders) shall not appoint more than one person as proxy.

154. Any person entitled under the Transmission Article (Article 87) to transfer anyshare may vote at any General Meeting in respect thereof in the same manneras if he were the registered holder of such shares, provided that forty-eight hoursat least before the time of the holding the meeting or adjourned meeting, as thecase may be, at which he proposes to vote he shall satisfy the Director of his

Demand for poll not toprevent, continuance ofbusiness

Restrictions on Voting

Equal Rights ofShareholders

Number of votes to which amember is entitled

Casting of votes by aMember entitled to morethan one vote

Votes of joint members

Voting in person or byproxy

Votes in respect of sharesof deceased and insolventMember

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right to transfer of such shares and give such indemnity (if any) as the Directorsmay require or the Directors shall have previously admitted his right to vote atsuch meeting in respect thereof. For the purpose of the Article, the Directors shallhave same powers either to recognise or to refuse to recognise such right totransfer, as they have to reject or accept, a transfer or transmission of sharesunder these Articles.

155. Every proxy (whether a Member or not) shall be appointed in writing under thehand of the appointer or his attorney, duly authorized in writing, or if suchappointer is a body corporate under the common seal of such corporation, or besigned by an officer or any attorney duly authorised by it, and any Committee orguardian may appoint such proxy. The proxy so appointed shall not have anyright to speak at the meeting.

158. A Member present by proxy shall be entitled to vote only on a poll.

MINUTES OF MEETINGS

165. a) The Company shall cause minutes of all proceedings of every General Meetingto be kept in accordance with the provisions of Section 193 of the Act.

h) The book containing the Minutes of the proceedings of any General Meeting ofthe Company shall:

i) be kept at the Registered Office of the Company, and

ii) be open, during the business hours to the inspection of any members withoutcharge, subject, to such reasonable restrictions as the Company may, in GeneralMeeting impose so however that not less than two hours in each day are allowedfor inspection.

iii) Any Member shall be entitled to be furnished within seven days after he hasmade a request in that behalf to the Company, with a copy of any minutes referredto in Clause (h) above, on payment of such fees as prescribed under Section196 of the Act.

DIRECTORS

167. Until otherwise determined in a General Meeting of the Company and subject tothe provisions of Section 252 of the Act, the number of Directors of the Company(excluding Alternate Directors) shall not be less than three or more than twelve.

169. Two thirds of the total number of Directors of the Company shall:

a) be persons whose period of office is liable to determination by retirement ofDirectors by rotation and

b) save as otherwise expressly provided in the Act; be appointed by the Companyin General Meeting.

170. One third of the total number of Directors shall be non-retiring and the ManagingDirector of the Company shall not be liable to retire by rotation.

176. The Board may, in accordance with and subject to the provision of Section 313of the Act, appoint an Alternate Director during the letter’s absence for a periodof not less than three months from the state in which the meeting of the Board isordinarily held. An Alternate Director appointed under this Article shall not holdoffice for a period longer than that permissible to the original director in whoseplace he has been appointed and shall vacate office if and when the originaldirector returns to that State. If the term of office of the original Director isdetermined before so returns to that State, any provisions in the Act or in these

Appointment of proxy

Proxy to vote only on a poll

Minutes of General Meetingand inspection thereof bymembers

Number of Directors

Directors of the Company

Appointment of non-retiringDirectors

Appointment of AlternateDirector

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Articles for the automatic reappointment of a retiring Director in default of anotherappointment shall apply to the Original Director and not the Alternate Director.

177. Subject to the provisions of Section 260, 261 and 264 of the Act and furthersubject to Articles 174, the Board shall have power at any time and from time totime to appoint any person to be an Additional Director, but so that the totalnumber of Directors shall not at any time exceed the maximum fixed under Article169. Any such Additional Director shall hold office only up to the date of nextAnnual General Meeting.

189. A Director of the Company who is in any way, whether directly of indirectlyconcerned or interested in a contract or arrangement, or proposed contract orarrangement entered into or to be entered into by or on behalf of the Company,shall disclose the nature of his concern or interest at a meeting of the Board inthe manner provided in section 299(2) of the Act; provided that it shall not benecessary for a Director to disclose his concern or interest in any contract orarrangement entered into or to be entered into with any other Company whereany of the Directors of the Company or two or more of them together hold orholds not more than two percent of the paid-up share capital in any such otherCompany or the Company.

201. Subject to Sections 259 of the Act, the Company may by ordinary resolution,from time to time, increase or reduce the number of Directors, within the limitsfixed in that behalf by these Articles, and may alter their qualifications and theCompany may (subject to the provisions of Section 284 of the Act) remove anyDirector before the expiration of his period of office and appoint another qualifiedperson in his place. The person so appointed shall hold office during such timeas the Director in whose place he is appointed would have held the same if hehad not been removed.

202. a) A person who is not a retiring Director shall, in accordance with and subject tothe compliance of provisions of Section 257 of the Act and Article 205 of thisArticles of Association, be eligible for appointment to the office of Director at anyGeneral Meeting.

205. a) The Company shall keep at its Office a Registrar containing the particulars of itsDirectors, Secretary and other persons mentioned in Section 303 of the Act, andshall otherwise comply with the provisions of the said section in all respects.

MANAGING DIRECTOR

207. Subject to the provisions of the Act and these Articles, the Board shall have thepower to appoint from time to time any of its members as Managing Director orManaging Directors and/or Whole time Director/s and/or Special Directors likeTechnical Director, Financial Director etc. of the Company for a fixed term notexceeding five years at a time and upon such terms and conditions as the Boardthinks fit, and the Board may by resolution vest in such Managing Director orManaging Directors/Whole time Director(s) and Special Directors such of thepowers hereby vested in the Board generally as it thinks fit, and such powersmay be made exercisable for such period or periods, and upon such conditionsand subject to such restrictions as it may determine.

WHOLE TIME DIRECTOR

211. Subject to the provisions of the Act and of these Articles, the Board may fromtime to time with such sanction of the Central Government as may be requiredby law appoint one or more of its Director/s or other person/s as Whole-TimeDirector or Whole-Time Directors of the Company out of the Directors/ persons

Additional Director

Disclosure of Interest

Company may increase orreduce the number ofDirectors

Right of persons other thanretiring Directors to standfor Directorship

Register of Directors etc.and notifications of change,to Registrar

The Board to appointManaging Director/s

Power to appoint WholeTime Director and/orWhole-time Directors

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nominated under Article only either for a fixed term that the Board may determineor permanently for life time upon such terms and conditions as the Board maydetermine or permanently for life time upon such terms and conditions as theBoard thinks fit. The Board may by ordinary resolution and / or an agreement/svest in such Whole-Time Director or Whole Time Directors such of the powersauthorities and functions hereby vested in the Board generally as it thinks fit.

PROCEEDINGS OF THE BOARD OF DIRECTORS

214. The Directors may meet together as a Board for the dispatch of business fromtime to time, and shall so meet at least once in every three months and at leastfour such meetings shall be held in every year. The Directors may adjourn orotherwise regulate their meeting as they think fit.

216. Subject to the Section 287 of the Act, the quorum for a meeting of the Boardshall be one-third of its total strength (excluding Director, if any, whose placesmay be vacant at the time) any fraction contained in that one-third being roundedoff as one), or two Directors, whichever is higher, provided that where at anytime the number of interested Directors exceeds or equal to two-third of the totalstrength the number of the remaining Directors, that is to say, the number ofDirectors who are not interested present at the meeting being not less than two,shall be the quorum during such time.

POWERS OF DIRECTORS

228. The Board may exercise all such powers of the Company and do all such actsand things as are not, by the Act, or any other Act or by the Memorandum or bythe Articles of the Company required to be exercised by the Company in GeneralMeeting, but subject nevertheless to these Articles, to the provisions of the Act,or any other Act and to such regulations being not inconsistent with the aforesaidregulations or provisions, as may be prescribed by the Company in GeneralMeeting, but no regulation made by the Company in General Meeting shallinvalidate any prior act of the Board which would have been valid if that regulationhad not been made.

REGISTERS, BOOKS AND DOCU MENTS

231. a) (i) The Company shall maintain registers, books, and documents as required bythe Act or these Articles.

THE SEAL

234. a) The Board shall provide a Common Seal for the purposes of the Company, shallhave powers from time to time to destroy the same and substitute a new Seal inlieu thereof, and the Board shall provide for the safe custody of the Seal for thetime being, and the Seal shall never be used except by the authority of the Boardof Committee of the Board, previously given.

DIVIDEND

237. The Company in General Meeting may declare dividends to be paid to Membersaccording to their respective rights but no dividends shall exceed the amountrecommended by the Board, but the Company in General Meeting may declarea smaller dividend.

238. No dividend shall be declared or paid except in accordance with Section 205and Section 205 A of the Act and no dividend shall carry interest as against theCompany. The declaration of the Board as the amount of profits of the Companyshall be conclusive. Where a dividend has been declared, either the dividend

Meeting of Directors

Quorum

Power of Directors

Registers, Books andDocuments

The Seal, its custody anduse

The Company in GeneralMeeting may declare adividend

Dividends only not to bepaid out of profit

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shall be paid or the warrant in respect thereof shall be posted to the shareholderentitled to the payment of the dividend within time prescribed under Section 207of the Act.

239. No dividend shall be paid by the Company in respect of any share except to theregistered holder of such share or to his order or to his banker.

240. Subject to the provision of the Act, the Board may, from time to time pay to theMembers such interim dividend as in their judgment the position of the Companyjustifies.

244. A transfer of shares shall not pass the right to any dividend declared thereonbefore the registration of the transfer.

246. No member shall be entitled to receive payment of any interest or dividend inrespect of his share or shares, whilst any money may be due or owing from himto the Company in respect of such share or shares or otherwise on any otheraccount whatsoever, either alone or jointly with any other person or persons,and the Board may deduct from the interest or dividend payable to any Memberall sums of money so due from him to the Company.

248. The Company shall not forfeit any unpaid or unclaimed dividend and suchdividends shall be dealt with according to the provisions of Section 205A, 205B,205C and 205D of the Companies Act, 1956.

251. Where a dividend has been declared by a Company but has not been paid, orthe warrant in respect thereof has not been posted, within 42 days from the dateof the declaration to any shareholder entitled to the payment of the dividend, theCompany shall, within 7 days from the date of expiry of the said period of 42days transfer the total amount of dividend which remains unpaid or in relation towhich no dividend warrant has been posted within the said period of 42 days, tospecial account to be opened by the Company in that behalf in any scheduledBank to be called “Unpaid dividend account of BLUPLAST INDUSTRIES LIMITED.

ACCOUNTS

256. The Company shall keep at the Office or at such other place in India as theBoard thins fit, proper Books of Accounts in accordance with Section 209 of theAct.

AUDIT

262. a) Every Balance Sheet and Profit & Loss Account shall be audited by one or moreAuditors, as may be appointed from time to time.

b) The Company will comply with all the provisions prescribed in Section 224 toSection 233 (both inclusive) of the Act, as amended from time to time.

DOCUMENTS AND NOTICES

266. a) A document or notice may be served or given by the Company on any Membereither personally or be sending it by post to him to his registered address or (ifhe has no registered address in India) to the address, if any, in India suppliedby him to the Company for serving documents or notices on him.

b) Where a document or notice is sent by post, service of the document or noticeshall be deemed to be effected by properly addressing, preparing and posting aletter containing the document or notice, serving shall be deemed to have beeneffected in the case of a notice of a meeting, at the expiry of forty-eight hoursafter the letter containing the document or notice is posted and in any other case,at the time at which the letter would be delivered in the ordinary course of post.

Dividend payable toRegistered holders

Interim Dividend

Transfer of shares must beregistered

No member to receivedividend whilst indebted tothe Company andCompany’s right ofreimbursement there out

Unclaimed dividend

Unpaid dividend

Directors to keep trueaccounts

Accounts to be audited

Service of documents ornotice on Members byCompany

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c) Where a member has intimated to the Company in advance that documentsshould be sent to him under a certificate of posting or by Registered Post with orwithout acknowledgement due, and has deposited with the Company a sumsufficient to defray the expenses of doing so, service of the documents shall notbe deemed to be effected unless it is sent in the manner intimated by the member.

268. A document or notice may be served or given by the Company on or to the joint-holders of a share of serving or giving the document or notice to the joint-holdernamed first in the Register of Members in respect of the shares.

WINDING UP

275. A. Subject to the provisions of the Act, if the Company shall be wound up and theassets available for distribution among the members as such be less thansufficient to repay the whole of the paid up capital such assets shall be distributedso that, as nearly, as may be the losses shall be borne by the members inproportion to the Capital paid up, or which ought to have been paid up, at thecommencement of winding up, on the shares held by them respectively. And ifin winding up, the assets available for distribution amongst the members shallbe more than sufficient to repay the whole of the Capital paid up at thecommencement of winding up the excess shall be distributed amongst themembers in proportion to the Capital at the commencement of the winding up orwhich ought to have been paid up on the shares held by them respectively.

B. But this clause will not prejudice the rights of the holders of shares issued uponspecial terms and conditions.

INDEMNITY AND RESPONSIBILITY

277. a) Subject to the provisions of Section 201 of the Act, every Director, Manager,Auditor and other Officer or Servant of the Company shall be indemnified by theCompany against, and it shall be the duty of the Directors out of the Funds of theCompany to pay all costs, losses and expenses which any such Director,Manager, Auditor or other Officer of Servant may incur or become liable to byreason of any contract entered into, or act or thing done by him as such Director,Manager, Auditor of other Officer or servant or in any way in the discharge of hisduties including travelling, expenses and in particular and so as not to limit thegenerality of the forgoing provisions against all liabilities incurred by him as suchDirector, Manager, Auditor or other Officer in defending any proceedings,whether civil or criminal, in which judgment is given in his favor or he is acquitted,or in connection with any application under Section 633 of the Act in which reliefis provided shall immediately attach as a lien on the property of the Companyand have priority as between the members over all other claims.

b) Subject to the provision of Section 201 of the Act, no Director, Manager, or otherOfficer of the Company shall be liable for the acts, receipts neglects or defaultsof any other Director or Officer or for joining in any receipt or other Act forconformity or for any loss or for joining in any receipt or other Act for conformityor for any loss or expenses happening to the Company through the insufficiencyor deficiency of title to any property acquired by order of the Directors for and onbehalf of the Company or for the insufficiency or deficiency of any security in orupon which any of the moneys of the Company shall be invested or for any lossor damage arising from the bankruptcy, insolvency or tortuous act of any personwith whom any moneys, securities or effect shall be deposited or for any lossoccasioned by an error of judgment or oversight on his part, or for any otherloss, damage or misfortune whatever which shall happen in the execution of theduties of his office or in relation thereto unless the same happen through hisown dishonest.

On joint holders

Winding up

Director’s and other’s rightof indemnity

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GENERAL POWER

279. Wherever in the Companies Act, it has been provided that the Company shallhave any right, privilege or authority or that the Company could carry out anytransaction only if the Company is so authorized by its Articles, than and in thatcase this Clause hereto authorizes and empowers the Company to have suchright, privilege or authority and to carry such transactions as have been permittedby the Act, without there being any specific Regulation in that behalf hereinprovided.

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MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The following contracts (not being contracts entered into in the ordinary course of business carried on by the Company)which are or may be deemed material have been entered or to be entered into by the Company. These contracts, copies ofwhich have been attached to the copy of the Prospectus, have been delivered to the Registrar of Companies, Mumbai,Maharashtra, for registration and also the documents for inspection referred to hereunder, may be inspected at the RegisteredOffice of the Company, from 10.00 a.m. to 4.00 p.m. on any working day from the date of the Prospectus until the date ofclosing of the Issue.

Material Contracts

1. Memorandum of Understanding, dated September 29, 2005 signed between the Company and Allianz SecuritiesLimited, the Lead Managers to the Issue.

2. Memorandum of Understanding, dated October 27, 2005 signed between the Company and Bigshare ServicesPrivate Limited, the Registrar to the Issue.

3. Copy of the Tri-partite Agreement dated March 2, 2006 between NSDL, the Company and Bigshare ServicesPrivate Limited.

4. Copy of the Tri-partite Agreement dated January 2, 2006 between CDSL, the Company and Bigshare ServicesPrivate Limited.

5. Agreement with Bluplast Corpoation for transfer of “Bluplast” brand in the name of Company.

6. Business Transfer Agreement with Alaska Industries for take over of its business.

Documents for Inspection

1. Memorandum and Articles of Association of Bluplast Industries Ltd., as amended from time to time.

2. Copy of special resolution passed at EGM dated September 20, 2005 u/s 81 (1A) authorizing the Issue of EquityShares.

3. Copies of letters to BSE & NSE regarding In-principle approval for Listing.

4. Copies of In-principle approvals from BSE & NSE dated February 24, 2006 and dated March 8, 2006 respectively.

5. Copy of Auditor Report issued by Statutory Auditors of the Company M/s Shingrodia Goyal & Co., CharteredAccountants, dated May 2, 2006.

6. Certificate from Statutory Auditor dated May 2, 2006 regarding the deployment of funds in relation to the expansionprogramme till date.

7. Copy of Tax Benefits Certificate issued by Statutory Auditors of the Company M/s Shingrodia Goyal & Co., CharteredAccountants, dated May 5, 2006.

8. Copy of letter dated January 21, 2006 from Legal Advisors for the vetting and approval of the Prospectus.

9. Copy of Appraisal Note of BOB Capital Markets Ltd.

10. Copies of quotation obtained and purchase orders placed for plant and machinery.

11. Consent letters from Promoters, Directors, Lead Managers to the Issue, Bankers to the Issue, Bankers to theCompany, Auditors, Legal Advisors to the Issue, Registrar to the Issue, Company Secretary & Compliance Officer toact in their respective capacities and for inclusion of their names in the Prospectus.

12. Copies of Annual Reports of the Company for the last 5 accounting periods i.e. FY 2002, FY 2003, FY 2004,FY 2005 and FY ended on 31st March 2006.

13. Copies of Annual Reports of the Promoter Group Companies.

14. Due Diligence Certificate dated January 21, 2006 issued by Lead Managers to the Issue, Allianz Securities Limited.

15. A copy of the SEBI Final observation letter no. CFD/DIL/ISSUES/PB/PR/62387/2006 dated March 10, 2006 receivedfrom SEBI in respect of the Public Issue of Bluplast Industries Ltd.

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DECLARATION

All the relevant provisions of the Companies Act, 1956, and the guidelines issued by the Government of India or the guidelinesissued by Securities and Exchange Board of India, established under Section 3 of the Securities and Exchange Board ofIndia Act, 1992, as the case may be, have been complied with and no statement made in this Prospectus is contrary to theprovisions of the Companies Act, the Securities and Exchange Board of India Act, 1992 or rules made thereunder or guidelinesissued, as the case may be. We further certify that all statements in this Prospectus are true and fair.

SIGNED BY ALL THE DIRECTORS OF BLUPLAST INDUSTRIES LIMITED

Sd/- Sd/-Kamlesh L. Jain Indermal P. JainManaging Director Director

Sd/- Sd/-Arvind M. Mehta Prince H. JainDirector Director

Sd/- Sd/-R. D. Jain Janakraj R. VakilDirector Director

Sd/-Shashi Nand NagoriManager (Finance & Accounts)

Date: May 13, 2006

Place: Mumbai

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