Entertainment World Developers Ltd.

DRAFT RED HERRING PROSPECTUSDated July 12, 2010

Please read section 60B of the Companies Act, 1956(The Draft Red Herring Prospectus will be updated upon filing with the RoC)

100% Book Building Issue

ENTERTAINMENT WORLD DEVELOPERS LIMITEDThe Company was incorporated on July 22, 1999 as ‘R.M.M. Construction Private Limited’ as a private limited company under the Companies Act, 1956, as amended (the “Companies Act”). The name of the Company was changed to ‘Entertainment World Developers Private Limited’ on February 28, 2003. The name of the Company was further changed to Entertainment World Developers Limited on conversion into a public limited company on February 5, 2010. For further details of changes in the

name and registered office of the Company, see “History and Certain Corporate Matters” on page 106 of this Draft Red Herring Prospectus. Registered Office: G-16, R. R. Hosiery Building, Shree Laxmi Woolen Mills, Opp. Shakti Mills Compound, Off. Dr. E. Moses Road, Mahalaxmi, Mumbai 400 011

Corporate Office: 6th Floor, Treasure Island, 11, M.G. Road, Tukoganj, Indore 452 001Contact Person: Bimal K. Nanda, Company Secretary and Compliance Officer

Tel: (91 22) 4045 0555; Fax: (91 22) 4045 0512; Email: [email protected]; Website: www.ewdpl.com

Promoters of the Company: Manish Kalani, Kalani Brothers (Indore) Private Limited and Padma Homes Private Limited

PUBLIC ISSUE OF 38,928,943 EQUITY SHARES OF Rs. 10 EACH (“EQUITY SHARES”) OF ENTERTAINMENT WORLD DEVELOPERS LIMITED (THE “COMPANY” OR THE “ISSUER” OR “EWDL”) FOR CASH AT A PRICE OF Rs. [l] PER EQUITY SHARE (INCLUDING A SHARE PREMIUM OF Rs. [l] PER EQUITY SHARE) AGGREGATING TO Rs. [l] MILLION (THE “ISSUE”). THE ISSUE WILL CONSTITUTE 30% OF THE POST-ISSUE PAID-UP CAPITAL OF THE COMPANY.

THE FACE VALUE OF EQUITY SHARES IS Rs. 10 EACH. THE PRICE BAND AND THE MINIMUM BID LOT WILL BE DECIDED BY THE COMPANY IN CONSULTATION WITH THE BOOK RUNNING LEAD MANAGERS (“BRLMs”) AND WILL BE ADVERTISED AT LEAST TWO WORKING DAYS

PRIOR TO THE BID/ISSUE OPENING DATE.

In case of any revision to the Price Band, the Bid/Issue Period will be extended by three additional working days after such revision of the Price Band, subject to the Bid/Issue Period not exceeding 10 working days. Any revision in the Price Band and the revised Bid/Issue Period, if applicable, will be widely disseminated by notification to the Bombay Stock Exchange Limited (“BSE”) and the National Stock Exchange of India Limited (“NSE”), by issuing a press release, and also by indicating the change on the website of the BRLMs and at the terminals of the other members of the Syndicate.

In terms of Rule 19(2)(b)(i) of the Securities Contracts (Regulation) Rules, 1957 (“SCRR”), this is an issue for more than 25% of the post-Issue capital. The Issue is being made through the 100% Book Building Process wherein at least 50% of the Issue shall be allocated on a proportionate basis to Qualified Institutional Buyers (“QIB”) Bidders. 5% of the QIB Portion (excluding Anchor Investor Portion) shall be available for allocation on a proportionate basis to Mutual Funds only, and the remainder of the QIB Portion shall be available for allocation on a proportionate basis to all QIB Bidders, including Mutual Funds, subject to valid Bids being received at or above the Issue Price. Further, not less than 15% of the Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Issue shall be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid Bids being received at or above the Issue Price. If at least 50% of the Issue cannot be Allotted to QIBs, then the entire application money shall be refunded forthwith. Potential investors other than Anchor Investors may participate in this Issue through an Application Supported by Blocked Amount (“ASBA”) process providing details about the bank account which will be blocked by the Self Certified Syndicate Banks (“SCSBs”) for the same. For details, see “Issue Procedure” on page 332 of this Draft Red Herring Prospectus.

RISK IN RELATION TO THE FIRST ISSUEThis being the first public issue of the Company, there has been no formal market for the Equity Shares of the Company. The face value of the Equity Shares is Rs.10 and the Issue Price is [l] times of the face value. The Issue Price (has been determined and justified by the Company, and the BRLMs as stated under the section on “Basis for Issue Price” on page 45 of this Draft Red Herring Prospectus) should not be taken to be indicative of the market price of the Equity Shares after the Equity Shares are listed. No assurance can be given regarding an active or sustained trading in the Equity Shares or regarding the price at which the Equity Shares will be traded after listing.

IPO GRADINGThis Issue has been graded by [l] as [l], indicating [l]. For details, see “General Information” on page 18 of this Draft Red Herring Prospectus.

GENERAL RISKSInvestments in equity and equity-related securities involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this Issue. In taking an investment decision, investors must rely on their own examination of the Company and the Issue, including the risks involved. The Equity Shares offered in the Issue have not been recommended or approved by the Securities and Exchange Board of India (“SEBI”), nor does SEBI guarantee the accuracy or adequacy of the contents. Specific attention of the investors is invited to “Risk Factors” on page xi of this Draft Red Herring Prospectus.

ISSUER’S ABSOLUTE RESPONSIBILITYThe Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Draft Red Herring Prospectus contains all information with regard to the Company and the Issue, which is material in the context of the Issue, that the information contained in this Draft Red Herring Prospectus is true and correct in all material aspects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which make this Draft Red Herring Prospectus as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.

LISTINGThe Equity Shares offered through this Draft Red Herring Prospectus are proposed to be listed on the BSE and the NSE. We have received an ‘in-principle’ approval from each of the BSE and the NSE for the listing of the Equity Shares pursuant to the letters dated [l] and [l], respectively. For the purposes of the Issue, the Designated Stock Exchange shall be [l].

BOOK RUNNING LEAD MANAGERS REGISTRAR TO THE ISSUE

ICICI Securities Limited* ICICI Centre, H. T. Parekh Marg Churchgate, Mumbai 400 020Tel: (91 22) 2288 2460 Fax: (91 22) 2282 6580E-mail: [email protected] Grievance Email: [email protected]: www.icicisecurities.comContact Person: Mangesh Ghogle / Vishal KanjaniSEBI Registration No.: INM000011179* ICICI Securities Limited has made an application on April 7, 2010 with SEBI for renewal of its certificate of registration

Kotak Mahindra Capital Company Limited1st Floor, Bakhtawar 229 Nariman Point, Mumbai 400 021 Tel: (91 22) 6634 1100Fax: (91 22) 2283 7517Email: [email protected] Investor Grievance Email: [email protected]: www.kotak.comContact Person: Chandrakant BholeSEBI Registration No.: INM000008704

Edelweiss Capital Limited14th floor, Express TowersNariman Point, Mumbai 400 021Tel: (91 22) 4086 3535Fax: (91 22) 4086 3610Email: [email protected] Grievance Email: [email protected]: www.edelcap.comContact Person: Neetu RankaSEBI Registration No.: INM0000010650

Link Intime India Private Limited C-13, Pannalal Silk Mills CompoundL.B.S Marg, Bhandup (West)Mumbai 400 078Tel: (91 22) 2596 0320Fax: (91 22) 2596 0329 Email: [email protected]: www.linkintime.co.inContact Person: Chetan ShindeSEBI Registration No.: INR000004058

BID/ ISSUE PROGRAMME*

BID/ISSUE OPENS ON: [l] * BID/ISSUE CLOSES ON: [l] *** The Company may consider participation by Anchor Investors. The Anchor Investor Bid/ Issue Period shall be one working day prior to the Bid/ Issue Opening Date.** The Company may consider closing the Bid/Issue Period for QIBs one day prior to the Bid/Issue Closing Date.

TABLE OF CONTENTS

SECTION I: GENERAL ........................................................................................................................................... I DEFINITIONS AND ABBREVIATIONS .................................................................................................................... I PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA .................................................................... IX FORWARD-LOOKING STATEMENTS .................................................................................................................... X SECTION II: RISK FACTORS ................................................................................................................................. XI SECTION III: INTRODUCTION ............................................................................................................................... 1 SUMMARY OF INDUSTRY ..................................................................................................................................... 1 SUMMARY OF BUSINESS ..................................................................................................................................... 4 SUMMARY FINANCIAL INFORMATION ......................................................................................................... ....... 10 THE ISSUE .............................................................................................................................................................. 17 GENERAL INFORMATION ...................................................................................................................................... 18 CAPITAL STRUCTURE ........................................................................................................................................... 26 OBJECTS OF THE ISSUE ....................................................................................................................................... 38 BASIS FOR ISSUE PRICE ...................................................................................................................................... 45 STATEMENT OF TAX BENEFITS ........................................................................................................................... 48 SECTION IV: ABOUT THE COMPANY .................................................................................................................. 58 INDUSTRY OVERVIEW ........................................................................................................................................... 58 BUSINESS ............................................................................................................................................................... 76 REGULATIONS AND POLICIES ............................................................................................................................. 100 HISTORY AND CERTAIN CORPORATE MATTERS .............................................................................................. 106 MANAGEMENT........................................................................................................................................................ 113 SUBSIDIARIES AND JOINT VENTURE .................................................................................................................. 129 PROMOTERS AND PROMOTER GROUP ............................................................................................................. 149 GROUP COMPANIES .............................................................................................................................................. 155 RELATED PARTY TRANSACTIONS ...................................................................................................................... 160 DIVIDEND POLICY .................................................................................................................................................. 161 SECTION V: FINANCIAL INFORMATION .............................................................................................................. 162 FINANCIAL STATEMENTS ..................................................................................................................................... 162 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION ............... 266 FINANCIAL INDEBTEDNESS ................................................................................................................................. 286 SECTION VI: LEGAL AND OTHER INFORMATION ............................................................................................. 288 OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS ........................................................................ 288 GOVERNMENT APPROVALS ................................................................................................................................. 295 OTHER REGULATORY AND STATUTORY DISCLOSURES ................................................................................ 314 SECTION VII: ISSUE INFORMATION .................................................................................................................... 325 TERMS OF THE ISSUE .......................................................................................................................................... 325 ISSUE STRUCTURE ............................................................................................................................................... 328 ISSUE PROCEDURE .............................................................................................................................................. 332 RESTRICTIONS ON FOREIGN OWNERSHIP OF INDIAN SECURITIES ............................................................. 361 SECTION VIII: MAIN PROVISIONS OF ARTICLES OF ASSOCIATION................................................................ 365 SECTION IX: OTHER INFORMATION ................................................................................................................... 380 MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION ....................................................................... 380 DECLARATION ....................................................................................................................................................... 382

i

SECTION I: GENERAL

DEFINITIONS AND ABBREVIATIONS

General Terms

Term Description

“EWDL”, “the Company” or the

“Issuer”

Unless the context otherwise indicates or implies, refers to Entertainment World

Developers Limited, a company incorporated under the Companies Act and

having its registered office at G-16, R. R. Hosiery Building, Shree Laxmi

Woolen Mills, Opp. Shakti Mills Compound, Off. Dr. E. Moses Road,

Mahalaxmi, Mumbai 400 011

“We”, “us” or “our” Unless the context otherwise requires, means the Company, its Subsidiaries and

joint venture

Joint Venture The joint venture of the Company as disclosed in “Subsidiaries and Joint

Venture” on page 129 of this Draft Red Herring Prospectus

Subsidiaries The subsidiaries of the Company as disclosed in “Subsidiaries and Joint

Venture” on page 129 of this Draft Red Herring Prospectus

Company Related Terms

Term Description

AEWDPL Annapoorna Entertainment World Developers Private Limited

Articles/Articles of Association Articles of Association of the Company

ATBPL Amaravati Treasure Bazaar Private Limited

Auditor The statutory auditor of the Company, Deloitte Haskins & Sells, Chartered

Accountants

BCCL The Baroda Commercial Corporation Limited

Board/Board of Directors The board of directors of the Company or a duly constituted committee thereof

CEO Chief Executive Officer

CEWPL Chandigarh Entertainment World Private Limited

Completed Projects Projects where construction has been completed and where the revenues of the

project have started

Corporate Office 6th

Floor, Treasure Island, 11, M. G. Road, Tukoganj, Indore 452 001

CRPL Cassandra Realty Private Limited

CTIPL Chandigarh Treasure Island Private Limited

Directors The director(s) of the Company, unless otherwise specified

DPPL Dazzling Properties Private Limited

EFSHPL EWDPL Five Star Hospitality Private Limited

ERHPL EWDPL Residential Holdings Private Limited

EWDAPL Entertainment World Developers Amritsar Private Limited

EWDBPL Entertainment World Developers Bijalpur Private Limited

Forthcoming Projects Projects in which the necessary legal documents relating to acquisition of land or

development rights have been executed, key land related approvals are being

obtained and management has prepared an initial design plan of the project or an

architect has been appointed and a detailed architect plan is in the process of

being prepared

Group Companies Companies, firms and ventures promoted by the Promoters, irrespective of

whether such entities are covered under section 370(1)(B) of the Companies Act

or not and disclosed in “Group Companies” on page 155 of this Draft Red

Herring Prospectus

IAF - III IDBI Trusteeship Services Limited (the merged entity after its merger with the

Western India Trustee and Executor Company Limited) in its capacity as trustee

of India Advantage Fund - III represented by its investment manager ICICI

Venture Funds Management Company Limited

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Term Description

IAF - IV IDBI Trusteeship Services Limited (the merged entity after its merger with the

Western India Trustee and Executor Company Limited) in its capacity as trustee

of India Advantage Fund - IV represented by its investment manager ICICI

Venture Funds Management Company Limited

ITMCPL Indore Treasure Market City Private Limited

ITPL Intesys Technologies Private Limited

ITTPL Indore Treasure Town Private Limited

JEWDPL Jodhpur Entertainment World Developers Private Limited

JTIPL Jabalpur Treasure Island Private Limited

KBIPL Kalani Brothers (Indore) Private Limited

Memorandum/ Memorandum of

Association

Memorandum of Association of the Company, unless the context otherwise

specifies

MMDCPL Marvell Mall Development Company Private Limited

NMMCPL Naman Mall Management Company Private Limited

NTBPL Nanded Treasure Bazaar Private Limited

Ongoing Projects Projects in respect of which the necessary legal documents relating to the

acquisition of land or development rights have been executed by us and/ or key

land related approvals have been obtained and any one of the following activities

are being undertaken (not necessarily in the sequence set out herein): (a) on-site

construction of the project has commenced; (b) initial detailed design for civil

and landscaping is being undertaken and work has commenced on detailed

design; (c) project launch activity which includes the construction of a show

residence, sales office and other supporting infrastructure at the project site has

commenced; or (d) an architect has been appointed and a detailed concept design

has being prepared

PEWDPL Pune Entertainment World Developers Private Limited

PHPL Padma Homes Private Limited

PML The Phoenix Mills Limited

Promoters Manish Kalani, Kalani Brothers (Indore) Private Limited and Padma Homes

Private Limited

Promoter Group Unless the context otherwise requires, refers to such persons and entities

constituting the promoter group of the Company in terms of Regulation 2(zb) of

the SEBI Regulations and disclosed in “Promoters and Promoter Group” on page

149 of this Draft Red Herring Prospectus

Registered Office G-16, R. R. Hosiery Building, Shree Laxmi Woolen Mills, Opp. Shakti Mills

Compound, Off. Dr. E. Moses Road, Mahalaxmi, Mumbai 400 011

RTIPL Raipur Treasure Island Private Limited

TFBPL Treasure Food & Beverages Private Limited

THPL Treasure Hospitality Private Limited

TMEP Treasure MEP Services Private Limited

TSPL Treasure Showcase Private Limited

TWCPL Treasure World Constructions Private Limited

TWDPL Treasure World Developers Private Limited

UTBPL Ujjain Treasure Bazaar Private Limited

UTMCPL Udaipur Treasure Market City Private Limited

WREPL Wanderland Real Estates Private Limited

Issue Related Terms

Term Description

Allotment/Allot/Allotted Unless the context otherwise requires, means the allotment of Equity Shares

pursuant to the Issue to the successful Bidders

Allottee A successful Bidder to whom the Equity Shares are Allotted

iii

Term Description

Anchor Investor A Qualified Institutional Buyer, applying under the Anchor Investor Portion with

a minimum Bid of Rs. 100 million

Anchor Investor Allocation

Notice

Notice or intimation of allocation of Equity Shares sent to Anchor Investors who

have been allocated Equity Shares after discovery of the Issue Price if the Issue

Price is higher than the Anchor Investor Issue Price

Anchor Investor Bid/Issue

Period

The day, one working day prior to the Bid/Issue Opening Date, on which Bids by

Anchor Investors shall be submitted and allocation to Anchor Investors shall be

completed

Anchor Investor Issue Price The final price at which Equity Shares will be issued and Allotted to Anchor

Investors in terms of the Red Herring Prospectus and the Prospectus, which price

will be equal to or higher than the Issue Price but not higher than the Cap Price.

The Anchor Investor Issue Price will be decided by the Company in consultation

with the BRLMs

Anchor Investor Portion Up to 30% of the QIB Portion which may be allocated by the Company to

Anchor Investors on a discretionary basis. One-third of the Anchor Investor

Portion shall be reserved for domestic mutual funds, subject to valid Bids being

received from domestic mutual funds at or above the price at which allocation is

being done to Anchor Investors

Application Supported by

Blocked Amount/ ASBA

An application, whether physical or electronic, used by all Bidders other than

Anchor Investors to make a Bid authorising an SCSB to block the Bid Amount in

their ASBA Account maintained with the SCSB

ASBA Account An account maintained by the ASBA Bidders with the SCSB and specified in the

ASBA Bid cum Application Form for blocking an amount mentioned in the

ASBA Bid cum Application Form

ASBA Bid cum Application

Form

The form, whether physical or electronic, used by a Bidder (other than Anchor

Investor) to make a Bid through ASBA process, which contains an authorisation

to block the Bid Amount in an ASBA Account and will be considered as the

application for Allotment for the purposes of the Red Herring Prospectus and the

Prospectus

ASBA Bidder Prospective investors other than Anchor Investors in this Issue who intend to

Bid/apply through ASBA

ASBA Revision Form The form used by the ASBA Bidders to modify the quantity of Equity Shares or

the Bid Amount in any of their ASBA Bid cum Application Form or any

previous ASBA revision form(s)

Banker(s) to the Issue/Escrow

Collection Bank(s)

The banks which are clearing members and registered with SEBI as Bankers to

the Issue and with whom the Escrow Account will be opened, in this case being

[●]

Basis of Allotment The basis on which Equity Shares will be Allotted to successful Bidders under

the Issue and which is described under “Issue Procedure – Basis of Allotment” on

page 354 of this Draft Red Herring Prospectus

Bid An indication to make an offer during the Bid/Issue Period by a Bidder pursuant

to submission of the Bid cum Application Form, or during the Anchor Investor

Bid/ Issue Period by the Anchor Investors, to subscribe to the Equity Shares of

the Company at a price within the Price Band, including all revisions and

modifications thereto

Bid Amount The highest value of the optional Bids indicated in the Bid cum Application Form

Bid cum Application Form The form used by a Bidder (which, unless expressly provided, includes the

ASBA Bid cum Application Form by an ASBA Bidder, as applicable) to make a

Bid and which will be considered as the application for Allotment for the

purposes of the Red Herring Prospectus and the Prospectus

Bidder Any prospective investor who makes a Bid pursuant to the terms of the Red

Herring Prospectus and the Bid cum Application Form

Bid/Issue Closing Date Except in relation to any Bids received from Anchor Investors, the date after

which the Syndicate and the Designated Branches of the SCSBs will not accept

iv

Term Description

any Bids for the Issue, which shall be notified in [●] edition of English national

daily newspaper, [●] edition of Hindi national daily newspaper and [●] edition of

regional language newspaper, each with wide circulation

Bid/Issue Opening Date Except in relation to any Bids received from Anchor Investors, the date on which

the Syndicate and the Designated Branches of the SCSBs shall start accepting

Bids for the Issue, which shall be notified in [●] edition of English national daily

newspaper, [●] edition of Hindi national daily newspaper and [●] edition of

regional language newspaper, each with wide circulation

Bid/Issue Period The period between the Bid/Issue Opening Date and the Bid/Issue Closing Date,

inclusive of both days, during which prospective Bidders can submit their Bids,

including any revisions thereof

Book Building Process Book building process, as provided in Schedule XI of the SEBI Regulations, in

terms of which this Issue is being made

BRLMs Book Running Lead Managers to the Issue, in this case being ICICI Securities

Limited, Kotak Mahindra Capital Company Limited and Edelweiss Capital

Limited

CAN/Confirmation of

Allotment Note

Note or advice or intimation of Allotment sent to the Bidders who have been

Allotted Equity Shares after Basis of Allotment has been approved by the

Designated Stock Exchange

Cap Price The higher end of the Price Band, above which the Issue Price will not be

finalised and above which no Bids will be accepted

Cut-off Price Issue Price, finalised by the Company in consultation with the BRLMs. Only

Retail Individual Bidders are entitled to Bid at the Cut-off Price, for a Bid

Amount not exceeding Rs. 100,000. QIBs and Non-Institutional Bidders are not

entitled to Bid at the Cut-off Price

Designated Branches Such branches of the SCSBs which shall collect the ASBA Bid cum Application

Forms used by the ASBA Bidders and a list of which is available on

http://www.sebi.gov.in

Designated Date The date on which funds are transferred from the Escrow Account or the amount

blocked by the SCSB is transferred from the ASBA Account, as the case may be,

to the Public Issue Account or the Refund Account, as appropriate, after the

Prospectus is filed with the RoC, following which the Board of Directors shall

Allot Equity Shares to successful Bidders

Designated Stock Exchange [●]

Draft Red Herring Prospectus

or DRHP

This Draft Red Herring Prospectus issued in accordance with Section 60B of the

Companies Act and the SEBI Regulations, which does not contain complete

particulars of the price at which the Equity Shares will be issued and the size (in

terms of value) of the Issue

Edelweiss Edelweiss Capital Limited

Eligible NRI(s) NRI(s) from jurisdictions outside India where it is not unlawful to make an issue

or invitation under the Issue and in relation to whom the Red Herring Prospectus

constitutes an invitation to subscribe to the Equity Shares

Engagement Letter Engagement letter dated June 18, 2010 between the Company and the BRLMs

Equity Shares Equity shares of the Company of Rs. 10 each fully paid-up unless otherwise

specified in the context thereof

Escrow Account Account opened with the Escrow Collection Bank(s) and in whose favour the

Bidders (excluding the ASBA Bidders) will issue cheques or drafts in respect of

the Bid Amount when submitting a Bid

Escrow Agreement Agreement dated [●] to be entered into by the Company, the Registrar to the

Issue, the BRLMs, the Syndicate Members, the Escrow Collection Bank(s) and

the Refund Bank(s) for collection of the Bid Amounts and where applicable,

refunds of the amounts collected to the Bidders (excluding the ASBA Bidders)

on the terms and conditions thereof

First Bidder The Bidder whose name appears first in the Bid cum Application Form or

v

Term Description

Revision Form or the ASBA Bid cum Application Form or the ASBA Revision

Form

Floor Price The lower end of the Price Band, at or above which the Issue Price will be

finalised and below which no Bids will be accepted

I-Sec ICICI Securities Limited

Issue The public issue of 38,928,943 Equity Shares for cash at a price of Rs. [●] each

aggregating to Rs. [●] million

Issue Agreement The agreement entered into on July 2, 2010 between the Company and the

BRLMs, pursuant to which certain arrangements are agreed to in relation to the

Issue

Issue Price The final price at which Equity Shares will be issued and Allotted in terms of the

Red Herring Prospectus. The Issue Price will be decided by the Company in

consultation with the BRLMs on the Pricing Date

Issue Proceeds The proceeds of the Issue that are available to the Company

Mutual Funds A mutual fund registered with SEBI under the SEBI (Mutual Funds) Regulations,

1996, as amended

Mutual Fund Portion 5% of the QIB Portion (excluding the Anchor Investor Portion), or 681,257

Equity Shares available for allocation to Mutual Funds only

Net Proceeds The Issue Proceeds less the Issue expenses. For further information about use of

the Issue Proceeds and the Issue expenses, see “Objects of the Issue” on page 38

of this Draft Red Herring Prospectus

Non-Institutional Bidders All Bidders that are not QIBs or Retail Individual Bidders and who have Bid for

Equity Shares for an amount of more than Rs. 100,000 (but not including NRIs

other than eligible NRIs)

Non-Institutional Portion The portion of the Issue being not less than 5,839,341 Equity Shares available for

allocation to Non-Institutional Bidders

Non-Resident A person resident outside India, as defined under FEMA and includes a Non

Resident Indian

Price Band Price Band of a minimum price of Rs. [●] (Floor Price) and the maximum price

of Rs. [●] (Cap Price) and includes revisions thereof. The Price Band and the

minimum Bid Lot size for the Issue will be decided by the Company in

consultation with the BRLMs and advertised, at least two working days prior to

the Bid/ Issue Opening Date, in [●] edition of English national daily [●], [●]

edition of Hindi national daily [●], and [●] edition of [●] regional language

newspaper.

Pricing Date The date on which the Company in consultation with the BRLMs finalises the

Issue Price

Prospectus The Prospectus to be filed with the RoC in accordance with Section 60 of the

Companies Act, containing, inter alia, the Issue Price that is determined at the

end of the Book Building Process, the size of the Issue and certain other

information

Public Issue Account Account opened with the Bankers to the Issue to receive monies from the Escrow

Account and from the SCSBs on the Designated Date

QIB Portion The portion of the Issue being at least 19,464,472 Equity Shares to be Allotted to

QIBs

Qualified Institutional Buyers

or QIBs Public financial institutions as specified in Section 4A of the Companies Act,

scheduled commercial banks, mutual fund registered with SEBI, FIIs and sub-

account registered with SEBI, other than a sub-account which is a foreign

corporate or foreign individual, venture capital fund registered with SEBI, state

industrial development corporation, insurance company registered with IRDA,

provident fund with minimum corpus of Rs. 25 crores, pension fund with

minimum corpus of Rs. 25 crores, National Investment Fund

Red Herring Prospectus or RHP The Red Herring Prospectus issued in accordance with Section 60B of the

Companies Act, which does not have complete particulars of the price at which

vi

Term Description

the Equity Shares are offered and the size of the Issue. The Red Herring

Prospectus will be filed with the RoC at least three days before the Bid/Issue

Opening Date and will become a Prospectus upon filing with the RoC after the

Pricing Date

Refund Account(s) The account opened with the Escrow Collection Bank(s), from which refunds, if

any, of the whole or part of the Bid Amount (excluding the ASBA Bidder) shall

be made

Refund Bank(s) [●]

Refunds through electronic

transfer of funds

Refunds through ECS, Direct Credit, RTGS or NEFT, as applicable

Registrar to the Issue/ Registrar Registrar to the Issue, in this case being Link Intime India Private Limited

Retail Individual Bidder(s) Individual Bidders who have Bid for Equity Shares for an amount not more than

Rs. 100,000 in any of the bidding options in the Issue (including HUFs applying

through their Karta and eligible NRIs and does not include NRIs other than

Eligible NRIs)

Retail Portion The portion of the Issue being not less than 13,625,130 Equity Shares available

for allocation to Retail Individual Bidder(s)

Revision Form The form used by the Bidders (which, unless expressly provided, includes the

ASBA Revision Form) to modify the quantity of Equity Shares or the Bid

Amount in any of their Bid cum Application Forms or any previous Revision

Form(s)

Self Certified Syndicate

Bank(s) or SCSB(s)

A banker to the Issue registered with SEBI, which offers the facility of ASBA

and a list of which is available on http://www.sebi.gov.in

Syndicate The BRLMs and the Syndicate Members

Syndicate Agreement The agreement dated [●] to be entered into between the Syndicate and the

Company in relation to the collection of Bids in this Issue (excluding Bids from

the Bidders applying through ASBA process)

Syndicate Members [●]

TRS/Transaction Registration

Slip

The slip or document issued by the Syndicate, or the SCSB (only on demand), as

the case may be, to the Bidder as proof of registration of the Bid

Underwriters The BRLMs and the Syndicate Members

Underwriting Agreement The agreement among the Underwriters, the Company to be entered into on or

after the Pricing Date

Working Days All days excluding Sundays and bank holidays in Mumbai

Conventional Terms

Term Description

Companies Act The Companies Act, 1956 and amendments thereto.

AGM Annual General Meeting

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

AY Assessment Year

BSE Bombay Stock Exchange Limited

CAGR Compounded Annual Growth Return

CDSL Central Depository Services (India) Limited

CIN Corporate Identity Number

Consolidated FDI Policy Consolidated FDI Policy issued by the Government of India, Ministry of Commerce

and Industry effective from April 1, 2010

Depositories NSDL and CDSL

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

DIN Director Identification Number

DP/ Depository Participant A depository participant as defined under the Depositories Act

DP ID Depository Participant‟s Identification

vii

Term Description

EBITDA Earnings Before Interest, Tax, Depreciation and Amortisation

ECS Electronic Clearing Service

EGM Extraordinary General Meeting

EPS Earnings Per Share i.e., is calculated by dividing the net profit or loss for the period

attributable to equity shareholders by the weighted average number of equity shares

outstanding during the period.

FCNR Foreign Currency Non-Resident

FDI Foreign Direct Investment

FEMA

Foreign Exchange Management Act, 1999 read with rules and regulations thereunder

and amendments thereto

FEMA Regulations FEMA (Transfer or Issue of Security by a Person Resident Outside India)

Regulations 2000 and amendments thereto

FII(s) Foreign Institutional Investors as defined under SEBI (Foreign Institutional Investor)

Regulations, 1995, as amended, and registered with SEBI under applicable laws in

India

Financial Year/ Fiscal/ FY Unless stated otherwise, the period of 12 months ending March 31 of that particular

year

FIPB Foreign Investment Promotion Board

FVCI Foreign Venture Capital Investors

GDP Gross Domestic Product

GIR General Index Register

GoI/Government Government of India

HNI High Net Worth Individual

HUF Hindu Undivided Family

ICAI Institute of Chartered Accountants of India

IFRS International Financial Reporting Standards

Income Tax Act The Income Tax Act, 1961, as amended

Indian GAAP Generally Accepted Accounting Principles in India

LOI Letter of Intent

MCGM Municipal Corporation of Greater Mumbai

MHADA Maharashtra Housing Area Development Authority

Mn / mn Million

NA/ n.a. Not Applicable

National Investment Fund National Investment Fund set up by resolution no. F. No. 2/3/2005-DDII dated

November 23, 2005 of the Government of India published in the Gazette of India

NAV Net Asset Value

NEFT National Electronic Fund Transfer

NOC No Objection Certificate

NR Non-resident

NRE Account Non Resident External Account

NRI Non Resident Indian, being a person resident outside India, as defined under FEMA

and the FEMA Regulations

NRO Account Non Resident Ordinary Account

NSDL National Securities Depository Limited

NSE The National Stock Exchange of India Limited

OCB A company, partnership, society or other corporate body owned directly or

indirectly to the extent of at least 60% by NRIs including overseas trusts, in which

not less than 60% of beneficial interest is irrevocably held by NRIs directly or

indirectly as defined under the FEMA Regulations. OCBs are not allowed to invest

in this Issue.

p.a. Per annum

P/E Ratio Price/Earnings Ratio

PAN Permanent Account Number

viii

Term Description

PAT Profit After tax

PBT Profit Before tax

PIO Person of Indian Origin

PLR Prime Lending Rate

RBI The Reserve Bank of India

RoC The Registrar of Companies, Maharashtra located at 100, Everest, Marine Drive,

Mumbai 400 002

RONW Return on Net Worth

Rs./Rupees Indian Rupees

RTGS Real Time Gross Settlement

SCRA Securities Contracts (Regulation) Act, 1956, as amended

SCRR Securities Contracts (Regulation) Rules, 1957, as amended

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

as amended

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

SEBI Regulations SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009, as

amended

SEBI Takeover Regulations Securities and Exchange Board of India (Substantial Acquisition of Shares and

Takeovers) Regulations, 1997, as amended

SIA Secretariat for Industrial Assistance

SICA Sick Industries Companies (Special Provisions) Act, 1985

SPV Special Purpose Vehicle

Sq. Ft./ sq. ft. Square feet

Sq. Mts./ sq. mts. Square metres

State Government The government of a State of India

Stock Exchanges BSE and the NSE

UIN Unique Identification Number

US / United States United States of America

US GAAP Generally Accepted Accounting Principles in the United States of America

USD/US$ United States Dollars

Securities Act U.S. Securities Act, 1933, as amended

VCFs Venture Capital Funds as defined in and registered with SEBI under the SEBI

(Venture Capital Fund) Regulations, 1996, as amended

Technical/Industry Related Terms

Term Description

Developable Area The total construction area which we develop in each property, and includes carpet

area, wall area, common area, service and storage area, as well as other areas,

including car parking.

FSI Floor Space Index, which means the quotient of the ratio of the combined gross floor

area of all floors, excepting areas specifically exempted, to the total area of the plot

Leaseable Area Is calculated by the loading percentage (the percentage of a tenant‟s rent applied

towards a shopping center‟s common areas) of 10.00% to 60.00% of the carpet area

of the property, depending upon the use, and refers to the part of the Developable

Area that can be leased out to third parties

Saleable Area The part of the area relating to our economic interest in each property

ix

PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA

Financial Data

Unless stated otherwise, the financial data in this Draft Red Herring Prospectus is derived from the audited

consolidated and unconsolidated financial statements for the financial years ended March 31, 2010, 2009, 2008,

2007 and 2006, prepared in accordance with Indian GAAP and the Companies Act and restated in accordance with

the SEBI Regulations and included in this Draft Red Herring Prospectus. In this Draft Red Herring Prospectus, any

discrepancies in any table between the total and the sums of the amounts listed are due to rounding off. All decimals

have been rounded off to two decimals points.

Our fiscal year commences on April 1 and ends on March 31 of the next year, so all references to particular Fiscal,

unless stated otherwise, are to the 12 months period ended on March 31 of that year.

There are significant differences between Indian GAAP, US GAAP and IFRS. The Company has not attempted to

explain those differences or quantify their impact on the financial data included herein, and to the investors shall

consult their own advisors regarding such differences and their impact on the financial data. Accordingly, the degree

to which the Indian GAAP financial statements included in this Draft Red Herring Prospectus will provide

meaningful information is entirely dependent on the reader‟s level of familiarity with Indian accounting practices.

Any reliance by persons not familiar with Indian accounting practices on the financial disclosures presented in this

Draft Red Herring Prospectus should accordingly be limited.

Currency and Units of Presentation

All references to “Rupees” or “Rs.” are to Indian Rupees, the official currency of the Republic of India. All

references to “US$” or “USD” are to United States Dollars, the official currency of the United States of America.

In this Draft Red Herring Prospectus, the Company has presented certain information related to land in various units.

The conversion ratio of such units is as follows:

1 hectare = 2.47 acres

1 acre = 4,046.85 sq. mts.

1 acre = 43,560.00 sq. ft.

1 sq. mts. = 10.76 sq. ft.

Industry and Market Data

Unless stated otherwise, industry and market data used in this Draft Red Herring Prospectus has been obtained or

derived from publicly available information as well as industry publications and sources. Industry publications

generally state that the information contained in those publications has been obtained from sources believed to be

reliable but that their accuracy and completeness are not guaranteed and their reliability cannot be assured.

Accordingly, no investment decision should be made on the basis of such information. Although industry data used

in this Draft Red Herring Prospectus is reliable, it has not been independently verified.

The extent to which the market and industry data used in this Draft Red Herring Prospectus is meaningful depends

on the reader‟s familiarity with and understanding of the methodologies used in compiling such data.

x

FORWARD-LOOKING STATEMENTS

This Draft Red Herring Prospectus contains certain “forward-looking statements”. These forward-looking

statements generally can be identified by words or phrases such as “aim”, “anticipate”, “believe”, “expect”,

“estimate”, “intend”, “objective”, “plan”, “project”, “shall”, “will”, “will continue”, “will pursue” or other words or

phrases of similar import. Similarly, statements that describe the Company‟s strategies, objectives, plans or goals are

also forward-looking statements. All forward-looking statements are subject to risks, uncertainties and assumptions

about the Company that could cause actual results and property valuations to differ materially from those

contemplated by the relevant forward-looking statement.

Actual results may differ materially from those suggested by the forward-looking statements due to risks or

uncertainties associated with the expectations with respect to, but not limited to, regulatory changes pertaining to the

industries in India in which we have our businesses and our ability to respond to them, our ability to successfully

implement our strategy, our growth and expansion, technological changes, our exposure to market risks, general

economic and political conditions in India and which have an impact on our business activities or investments, the

monetary and fiscal policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange

rates, equity prices or other rates or prices, the performance of the financial markets in India and globally, changes

in domestic laws, regulations and taxes and changes in competition in our industry. Important factors that could

cause actual results to differ materially from our expectations include, but are not limited to, the following:

The performance of, and the prevailing conditions affecting, the real estate market in India generally;

development rights in respect of certain of our projects are subject to conditions, certain of which have not

been or may not be satisfied;

volatility in prices of, or shortages of, key building materials;

changes to the FSI/TDR regime;

financial stability of our tenants, in particular, our key tenants and our hotel and school operators;

changes to the slum rehabilitation schemes; and

difficulties in expanding our business into additional geographical markets in India.

For further discussion of factors that could cause the actual results to differ from the expectations, see “Risk

Factors”, “Business” and “Management‟s Discussion and Analysis of Financial Condition and Results of

Operations” on pages xi, 76 and 266 of this Draft Red Herring Prospectus, respectively. By their nature, certain

market risk disclosures are only estimates and could be materially different from what actually occurs in the future.

As a result, actual gains or losses could materially differ from those that have been estimated.

Forward-looking statements reflect the current views as of the date of this Draft Red Herring Prospectus and are not

a guarantee of future performance. Neither the Company, the Directors, the Underwriters nor any of their respective

affiliates have any obligation to update or otherwise revise any statements reflecting circumstances arising after the

date hereof 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 BRLMs will ensure that investors in India are

informed of material developments until the time of the grant of listing and trading permission by the Stock

Exchanges.

xi

SECTION II: RISK FACTORS

The risks and uncertainties described below together with the other information contained in this Draft Red Herring

Prospectus should be carefully considered before making an investment decision in the Equity Shares. The risks

described below are not the only ones relevant to the country, the industry in which we operate, or the Equity

Shares. Additional risks, not presently known to us or that we currently deem immaterial, may also impair our

business and operations. If any of the risks described below actually occur, our business, prospects, financial

condition and results of operations could suffer, the trading price of the Equity Shares could decline, and

prospective investors may lose all or part of their investment.

Prospective investors should pay particular attention to the fact that we are incorporated under the laws of India

and are subject to a legal and regulatory environment, which may differ in certain respects from that of other

countries.

This Draft Red Herring Prospectus also contains forward-looking statements that involve risk and uncertainties.

Our actual results could differ from those anticipated in these forward-looking statements as a result of certain

factors, including the considerations described below and elsewhere in this Draft Red Herring Prospectus. See

“Forward-Looking Statements” on page x of this Draft Red Herring Prospectus.

Unless specified or quantified in the relevant risk factors below, we are not in a position to quantify the financial or

other implication of any of the risks described in this section.

RISKS RELATING TO OUR BUSINESS

1. Most of our Ongoing Projects and Forthcoming Projects are still under development and have not

commenced operation; these projects are consequently exposed to a number of risks and uncertainties.

Most of our projects are still under development. The development of these new projects involves various

risks including, regulatory risks, financing risks and the risks that these projects may ultimately prove to be

unprofitable. These projects under development may pose significant challenges to our management,

administrative, financial and operational resources. We cannot provide any assurance that we will succeed

in any of these projects or that we will recover our investments. Any delay or failure in the development,

financing or operation of any of our new projects, or increase in their costs of development, is likely to

affect our business, prospects, financial condition and results of operations. We may be affected by the

development of our projects due to the following reasons:

the contractors and third parties hired to complete the projects may be unable to complete the

construction of the project on time, within budget or to the required specifications and standards;

delays in completion and commercial operation could increase the financing and other costs

associated with the construction and cause us to spend more capital than we anticipated for a

project;

we may be unable to obtain adequate capital or other financing at competitive rates to complete

construction of and to commence operations of these projects;

we may be unable to recover the amounts already invested in these projects if the assumptions

contained in the feasibility studies for these projects do not materialize.

While we expect most of the third parties for our projects to provide certain customary guarantees and

indemnities as to timely completion and cost overruns in the relevant construction contracts, these

guarantees and indemnities may not cover the entire amount of any cost overruns and we may be unable to

recover any or all amounts under such guarantees and indemnities. In addition, while we expect insurance

policies will be taken to cover natural disaster risks and other insurable risks, we cannot assure you that any

cost overruns or additional liabilities would be adequately covered by such insurance policies. As a result,

xii

we cannot assure you that our current or future projects under development will be completed, or, if

completed, will be completed on time or within budget.

2. We are dependent upon a few contractors and third party entities for the development of our projects,

and the inability or unwillingness of such third parties to provide their services to us on a timely and

cost-efficient basis may adversely affect our business and results of operations.

We undertake the management of our construction and fit out activity through Treasure MEP Services

Private Limited (“TMEP”) our wholly owned subsidiary and Intesys Technologies Private Limited

(“Intesys”), a Delhi based interior and fit-out specialist company in which we hold a 51.00% equity

interest. These companies in turn enter into agreements with other third parties and contractors such as

architects, engineers, and other suppliers of labor and materials to develop the property according to our

specifications and quality standards. The timing and quality of construction of the projects we develop

depends on the availability and skill of such third parties, as well as contingencies affecting them, including

labor and raw material shortages and industrial action such as strikes and lockouts. We may be unable to

identify appropriate experienced third parties and cannot assure you that skilled third parties will continue

to be available at reasonable rates and in the areas in which we undertake our projects, or at all. As a result,

we may be required to make additional investments or provide additional services to ensure the adequate

performance and delivery of contracted services. Any consequent delay in project execution could

adversely affect our profitability and reputation.

If such contractors or third party entities are unable to perform their contracts, including completing our

developments within the specifications, quality standards and time frames specified by us, at the estimated

cost, or at all, our business, reputation and results of operations could be adversely affected. While our

contractors provide us with back-to-back warranties, such warranties may be insufficient to cover our

losses and such losses could adversely affect our financial condition and results of operations. Further, we

cannot assure you that the services rendered by any of our independent construction contractors will always

be satisfactory or match our requirements for quality. We may therefore incur losses as a result of our

projects being delayed or disrupted or having to fund the repair of defective work or pay damages to

persons who have suffered losses as a result of such defective work. We have limited control over the cost,

availability or quality of their products or services, and as such the inability or unwillingness of other third-

party suppliers and sub-contractors to provide their products and services to us, including on a timely and

cost-efficient basis, may adversely affect our business and results of operations.

Further, the amount of property development in India has been significant in the recent past. As a result,

our contractors and other construction companies have had significant projects to complete and a

substantial backlog. If the services of these or other contractors do not continue to be available on terms

acceptable to us, or at all, our business and results of operations could be adversely affected. Additionally,

our operations may be affected by circumstances beyond our control such as work stoppages, labor

disputes, shortage of qualified skilled labor or lack of availability of adequate infrastructure.

Our joint venture partners, contractors and service providers may also face financial, legal or other

difficulties which may affect their ability to continue with a project. We may therefore be required to make

additional investments in the joint venture, provide extra funding or become liable for other obligations,

which could result in delays to our projects, reduced profits or, in some cases, significant losses.

3. The success of our future projects depends on our ability to identify properties in appropriate locations

to attract suitable businesses and customers.

Our ability to identify suitable new projects is fundamental to the growth of our business and involves

certain risks, including identifying and acquiring appropriate land, appealing to the tastes and needs of our

retail, residential, commercial and hospitality customers, understanding and responding to the requirements

of such customers and anticipating the changing trends in India. In identifying new projects, we also need

to take into account land use regulations, the land‟s location, including access and neighborhood, the land‟s

proximity to resources such as water and electricity and the availability and competence of third parties

such as architects, surveyors, engineers and contractors. We may not be as successful in identifying suitable

xiii

projects that meet market demand in the future. The failure to identify suitable projects and develop

properties that meet customer demand in a timely manner could result in loss or reduced profits. In

addition, it could reduce the number of projects we undertake and slow our growth.

In addition, we believe that in order to successfully operate retail developments we need to have the ability

to forecast demand, as well as enter into leasing arrangements with popular retailers. We believe that in

order to draw consumers away from traditional shopping environments, such as small local retail stores or

markets as well as from competing centers, we need to create demand for our retail developments where

customers can take advantage of a variety of consumer and retail options, such as large department stores,

in addition to amenities such as designer stores, comprehensive entertainment facilities, including

multiplexes, restaurants, bars, air conditioning and parking. Further, to help ensure our shopping centers‟

success, we must secure suitable anchor tenants and other retailers as they play a key role in generating

customer traffic. A decline in consumer and retail spending or a decrease in the popularity of the retailers‟

businesses could cause retailers to cease operations or experience significant financial difficulties that in

turn could harm our ability to continue to attract successful retailers and visitors to our projects.

4. There are criminal proceedings currently pending against one of the Promoters and certain Directors of

the Company.

There are criminal proceedings outstanding against one of our Promoters and certain Directors. A criminal

complaint has been filed by the State of Madhya Pradesh against the Promoter and Managing Director,

Manish Kalani and the Executive Director, B. Rajesh Nair in their capacity as directors of Naman Mall

Management Company Private Limited in relation to the death of a worker. A criminal complaint has been

filed by Mahesh Garg against Manish Kalani and others before the Director General of Police and

Superintendent of Police, Economic Offence Wing, Bhopal. Further, a complaint is pending against one of

the Directors, Mukesh Kacker in his capacity as the managing director of M.P Urja Vikas Nigam in relation

to alleged irregularities in the tender process for the supply of goods.

An adverse outcome in any or all of these criminal proceedings involving the Promoter or Directors could

have an adverse effect on their ability to serve our Company, as well as on our business, financial condition

and results of operations. We cannot assure you that any of these proceedings will be decided in favour of

the Directors, or that no further liability will arise out of these proceedings. For further details, see the

section “Outstanding Litigation and Material Developments” on page 288 of this Draft Red Herring

Prospectus.

5. There are outstanding legal proceedings involving our Company, our Subsidiaries, Directors and

Promoter.

There are outstanding legal proceedings involving our Company, our Subsidiaries, Directors and

Promoters. These proceedings are pending at different levels of adjudication before various courts,

tribunals, enquiry officers, appellate tribunals and arbitrators. A criminal complaint has also been filed

against Manish Kalani and B. Rajesh Nair, in relation to an accident at the construction site under the

Building and Other Construction Workers (Regulation of Employment & Condition of Service) Act, 1996,

in their capacity as directors of Naman Mall Management Company Private Limited. For further details,

see “Outstanding Litigation and Material Developments” on page 288 of this Draft Red Herring Prospectus.

In addition, further liability may arise out of these claims. Brief details of such outstanding litigation as of

the date of the Draft Red Herring Prospectus are as follows:

Litigation against the Company

Sr.

No.

Nature of cases No. of outstanding cases Amount Involved

(in Rs. million)

1. Civil proceedings 3 0.09

xiv

Litigation against the Subsidiaries

Sr.

No.

Nature of cases No. of outstanding cases Amount involved

(in Rs. million)

1. Civil proceedings 1 Amount not ascertainable

2. Notice#

4 22.12

Litigation against the Directors

Sr.

No.


(in Rs. million)

1. Criminal proceedings 3 Amount not ascertainable

Litigation against the Promoters

Sr.

No.


(in Rs. million)

1. Criminal proceedings* 2 Amount not ascertainable

2. Civil proceedings** 1 Amount not ascertainable

* Includes the criminal proceedings as mentioned under “Outstanding Litigation and Material Developments- Litigation against

the Directors.” ** Filed jointly against KBIPL and PHPL. # Includes three consumer notices.

Litigation against Group Companies

Sr.

No.


(in Rs. million)

1. Civil proceedings 2 Amount not ascertainable

2. Criminal proceedings 1 Amount not ascertainable

An adverse outcome in any of these proceedings may affect our reputation and standing and affect our

future business and could have an adverse effect on our business, prospects, financial condition and results

of operations. We cannot assure you that any of these proceedings will be decided in our favor, or in favor

of our Directors, Promoter, Subsidiaries, Joint Venture or Group Companies, or that no further liability will

arise out of these proceedings. For further details of outstanding litigation against us, our Directors,

Promoters, Subsidiaries, Joint Venture or Group Companies, see “Outstanding Litigation and Material

Developments” on page 288 of this Draft Red Herring Prospectus.

6. The real estate industry in India underwent a significant downturn which had, and if the downturn were

to occur again, could, adversely affect our business, liquidity and results of operations.

The success of our residential projects are heavily dependent on the performance of the real estate market

in India, particularly in the regions in which we operate or intend to operate, and could be adversely

affected if real estate prices or market conditions deteriorate in India. We currently generate most of our

revenues from sales of residential property and the lease of our retail and hospitality properties, and a

decrease in residential property prices and lease rates could adversely affect our financial condition and

results of operations. Our projects take a substantial amount of time to develop and we could incur losses if

we purchase land at high prices and sell or lease the developed projects during weaker economic periods.

Further, the real estate market, both for land and developed properties is relatively illiquid, which may limit

our ability to respond promptly to market events.

Economic developments outside India adversely affected the property market in India and our overall

business. The global credit markets experienced significant volatility which originated from the adverse

developments in the United States and the European Union credit and sub-prime residential mortgage

markets. These and other related events, such as the collapse of a number of financial institutions, had an

xv

adverse effect on the availability of credit and the confidence of the financial markets globally, as well as in

India.

In light of these events, the real estate industry was significantly affected. An industry-wide softening of

demand for property resulted from a lack of consumer confidence, decreased affordability, decreased

availability of mortgage financing, and large supplies of resale and new inventories. Though the global

credit market and the Indian real estate market have recovered, economic turmoil may have other

unforeseen consequences, leading to uncertainty about future conditions in the real estate industry. We

cannot assure you that Government responses to the disruptions in the financial markets have restored

consumer confidence, stabilized the markets or increased liquidity and the availability of credit. Such

recurrence of the downturn would have an adverse effect on our business, liquidity and results of

operations.

7. Our business is heavily dependent on the availability of real estate financing in India and the failure to

obtain additional financing may adversely affect our ability to grow and our future profitability.

Our business and growth strategy is highly capital intensive, requiring substantial capital on acceptable

terms to develop and market our projects. The actual amount and timing of our future capital requirements

may also differ from estimates as a result of, among other things, unforeseen delays or cost overruns in

developing our projects, unanticipated expenses, regulatory changes and engineering design changes. See

“Management‟s Discussion and Analysis of Financial Condition and Results of Operations - Financial

Condition, Liquidity and Capital Resources - Capital Expenditures” and “Business - Strategies” on pages

283 and 80, respectively of this Draft Red Herring Prospectus. To the extent our capital expenditure

requirements exceed our available resources we will be required to seek additional debt or equity financing.

Additional debt financing could increase our interest cost and require us to comply with additional

restrictive covenants in our financing agreements. Additional equity financing could dilute our earnings per

share which could adversely affect our share price. In addition, the Indian regulations on foreign investment

in townships, housing, built-up infrastructure and construction and development projects impose significant

restrictions on us.

Our ability to obtain additional financing on favorable commercial terms, if at all, will depend on a number

of factors, including:

● our future financial condition, results of operations and cash flows;

● the amount and terms of our existing indebtedness;

● our credit rating;

● general market conditions for financing activities by real estate companies; and

● economic, political and other conditions in the markets where we operate.

Our attempts to consummate future financings may not be successful or be on favorable terms and failure

to obtain financing on terms favorable to us could have an adverse effect on our business prospects and

results of operations.

In addition, it is customary in the real estate business in which we operate to provide mobilization advances

in favor of third party contractors to secure obligations under contracts. We may not be able to continue

obtaining additional indebtedness or other access to capital in sufficient amounts to meet our business

requirements. If we are unable to incur sufficient additional indebtedness or have access to capital, our

ability to grow could be limited.

xvi

8. Difficult conditions in the global financial markets and the economy may cause us to experience limited

availability of funds.

Changes in the global and Indian financial markets have significantly diminished the availability of credit

and led to an increase in the cost of financing. In many cases, the markets have exerted downward pressure

on the availability of liquidity and credit capacity. We may need liquidity for future growth and

development of our business and may have difficulty accessing the financial markets, which could make it

more difficult or expensive to obtain financing in the future. Without sufficient liquidity, we may not be

able to purchase additional land or develop additional projects, which would adversely affect our results of

operations. We cannot assure you that we will be able to raise additional financing on acceptable terms in a

timely manner, or at all. Our failure to renew existing funding or to obtain additional financing on

acceptable terms in a timely manner could adversely affect our planned capital expenditure, business and

results of operations including our growth prospects.

9. We will depend upon the satisfaction of the obligations of equity partners and investors in our project-

specific SPVs in the operation of our business.

The success of our projects depends upon the satisfaction of the obligations of our equity partners and other

investors in the project-specific SPVs that will undertake our projects, such as the provision of land,

financing and other services. Although shareholders‟ agreements, or other agreements may legally obligate

the equity partners and other investors to provide the relevant services and cooperate with us, we cannot

assure you that they will comply with such agreements, or that such equity partners and investors would

otherwise provide such services, on a timely basis, or at all. Termination of such agreements could also

adversely affect our business and results of operations.

10. Our Ongoing and Forthcoming projects under development and construction take significant periods of

time to complete and may not commence or be completed by their expected dates, or at all, which may

adversely affect our business, financial condition and results of operations.

As of March 31, 2010, we had 11 Ongoing Projects and three Forthcoming projects. Our business is

affected by construction schedules and the time required to develop our projects. In general, real estate

development projects take significant time to complete and, as a result, are often subject to delays in

completion. Due to the competitive nature of the real estate development business and the tender processes,

provisions in our contracts with third parties that contemplate liquidated damages in case of delays may not

fully, if at all, compensate us for our losses. As such, any delay or disruption in the start of construction,

construction schedules or projected timelines for the development of our projects could adversely affect our

business, financial condition and results of operations.

Our Ongoing and Forthcoming Projects are subject to significant changes and modifications from our

currently estimated management plans and timelines as a result of factors outside our control, including,

among others:

availability of raw materials and financing;

increases in construction costs;

natural disasters;

reliance on third party contractors; and

the risk of decreased market demand during the development of a project.

Such changes and modifications may have an adverse effect on our Ongoing and Forthcoming Projects, and

consequently, we may not develop these projects as planned, or at all, which may have an adverse effect on

our business, results of operations and financial condition.

xvii

11. We currently depend on sales and advance sales from our residential developments and rental income

from Treasure Island, Indore, Treasure Central, Indore and Treasure Bazaar, Nanded for almost all of

our income.

Our income from sales and advance sales of residential property in our residential developments and rental

income (including common area maintenance charges and other charges) from Treasure Island, Indore,

Treasure Central, Indore and Treasure Bazaar, Nanded for the financial years ended March 31, 2010, 2009,

2008, 2007 and 2006 was 85.82%, 71.43%, 84.69%, 94.29% and 99.62%, respectively, of our total income.

Until such time as we complete the development of our Ongoing and Forthcoming Projects our total

income is expected to be primarily from the revenues generated from the sale of residential property and

lease rentals from Treasure Island, Indore, Treasure Central, Indore and Treasure Bazaar, Nanded, and any

failure of sales from our residential developments and lease rentals from Treasure Island, Indore, Treasure

Central, Indore and Treasure Bazaar, Nanded to generate income would have an adverse effect on our total

income and profitability. Failure to complete or delays in the development of our residential developments

in which we have made advance sales could result in us having to return advance payments to buyers or

penalties, which would have an adverse effect on our business, results of operations and financial

condition. In addition, in the event of a regional slowdown in the business, economic or construction

activity in the cities in which we are developing projects or their surrounding areas, or any developments

that make projects in such cities less economically beneficial, our business, financial condition and results

of operations could be adversely affected.

12. The success of our residential property business is dependent on our ability to anticipate and respond to

consumer requirements.

The growing disposable income of India's middle and upper income classes, together with changes in

lifestyle, has resulted in a substantial change in the nature of their demands. In our residential business, our

focus is on developing residential townships in which we design, build and sell a wide range of properties,

including townhouses and apartments of varying sizes. Our focus on the development of high quality

residential townships requires us to satisfy these demanding consumer expectations. The amenities now

demanded by consumers include those that have historically been uncommon in India's residential real

estate market such as 24-hour electricity, parking, gardens, playgrounds, swimming pools, fitness centers,

tennis courts and golf courses. If we fail to anticipate and respond to consumer requirements, we could lose

potential clients to competitors, which in turn could adversely affect our business, results of operations,

financial condition and prospects.

13. Our shopping centers depend on tenants to generate rental revenues.

Our results of operations for our shopping centers depend on our tenants‟ ability to generate revenues from

their operations. If the sales of certain stores operating in our shopping centers do not generate sufficient

revenues, our tenants might be unable to pay their existing rents or common area maintenance charges,

since these rents and charges would represent a higher percentage of their sales. Our revenues, business,

results of operations and financial condition may be affected if:

our tenants delay the start of their leases;

our tenants decline to extend or renew leases upon expiration;

a significant number of our tenants are unable (due to poor operating results, capital constraints,

bankruptcy, or other reasons) to meet their obligations; or

for any other reason, we are unable to collect a significant amount of rental payments.

Any of these actions could result in the termination of a tenant‟s lease and the loss of rental income

attributable to the terminated leases. In addition, a decision by an anchor tenant, or other significant tenant

to cease operations at our shopping centers could also have an adverse effect on our financial condition.

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The closing of an anchor tenant‟s store or other significant tenant may adversely affect occupancy at our

shopping centers. Further, anchor tenants or other tenants at one or more shopping centers may terminate

their leases as a result of mergers, acquisitions, consolidations, dispositions or bankruptcies in the retail

industry. The bankruptcy and/or closure of retail stores, or sale of an anchor or store to a less desirable

retailer, may reduce occupancy levels, customer traffic and rental income, or otherwise adversely affect our

financial performance. Furthermore, if revenues generated by retailers operating in our shopping centers

declines sufficiently, tenants may be unable to pay their rent or common area maintenance charges. In the

event of a default by a lessee, we may experience delays and costs in enforcing our rights as lessor. Our

revenues, business, results of operations and financial condition may be affected if our tenants do not

generate sufficient revenues.

14. Market conditions affect the willingness and ability of our tenants to pay rent at suitable levels, which in

turn affects the revenues generated from our properties and projects.

Our retail and hospitality real estate businesses have historically targeted, and will continue to target, select

retailers and hotel operators. Our growth and success will therefore depend on the provision of high quality

space to attract and retain tenants who are willing and able to pay rent at suitable levels and on our ability

to anticipate the future needs and expansion plans of these customers. A number of market conditions,

which are beyond our control, may affect the income generated by our retail properties, including:

the national economic climate;

the regional and local economy (which may be adversely affected by unemployment, real estate

values, taxes, plant closings, industry slowdowns, union activity, adverse weather conditions,

natural disasters, terrorist activities and other factors);

local real estate conditions (such as an oversupply of, or a reduction in demand for, retail space or

retail goods, hotel rooms, decreases in rental rates, real estate values and the availability and

creditworthiness of current and prospective tenants);

levels of consumer spending, consumer confidence and seasonal spending (especially during

holiday or festive seasons when many retailers and hotels generate a disproportionate amount of

their annual profits); and

perceptions by retailers, shoppers of the safety, convenience and attractiveness of our shopping

centers.

Our retail and hospitality real estate businesses would be adversely affected if our targeted tenants were to

experience a slowdown or if companies were to scale down their operations. General economic conditions

and other factors may affect the financial stability and business prospects of our tenants and prospective

tenants and/or the demand for our retail or hospitality properties. In the event of a default or termination of

the lease by the tenant prior to its expiry, we will suffer a rental shortfall and incur additional costs,

including legal expenses, in maintaining, insuring and re-letting the property. If we are unable to re-let or

renew lease contracts promptly, if the rentals upon such renewals or re-leasing are lower than the expected

value or reserves, if any, for these purposes prove inadequate, our results of operations, financial condition

and the value of our real estate could be adversely affected.

For the financial year 2010, revenues from our retail real estate business represented 33.80% of our total

income. Our retail real estate business is focused on the development of retail space and leasing or entering

into revenue share arrangements for such retail space. Our growth and success will depend on the provision

of high quality retail space to attract and retain clients who are willing to make rental payments or enter

into revenue share arrangements at suitable levels, and on our ability to anticipate the future needs and

expansion plans of such clients. We will incur significant costs for the integration of modern fittings,

contemporary architecture and landscaping, as well interiors and fit-outs of the common areas expected by

our retailers and customers to the shopping center. Our inability to provide retailers with properties that

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correspond to their needs could adversely affect our business.

15. Inadequate project management could adversely affect the attractiveness of our projects and as a result,

adversely affect our results of operations and financial condition.

Our business depends on proper and timely management of our projects under development. For example,

our customers, including the occupants of our retail and residential properties, depend upon the timely

completion, quality construction and the effective management of the properties leased and sold to them.

Effective management includes the day-to-day operation of the project as well, including activities such as

regulation of traffic, cleanliness and security, availability of utilities and parking. Although we focus on

project management in a number of ways, including by appointing project managers and management

teams at our projects, ineffective or inefficient project management could adversely affect the attractiveness

of our projects, and as a result adversely affect our results of operations and financial condition.

16. We employ revenue sharing arrangements in leasing our retail and hospitality properties which exposes

us to operating risks of the retail and hospitality industries.

Our financial performance is influenced by conditions in the retail business, and to a lesser extent the

hospitality business, in India and the cities in which we operate. Our shopping centers and hotels businesses

derive revenues from fixed price leases from our tenants and as a percentage of our tenants‟ sales. Retail

and hospitality property markets and/or individual properties have historically been, and could in the future

be, adversely affected by any of the following:

cyclical downturns arising from changes in general and local economic conditions;

periodic oversupply of retail properties and/or hotel rooms;

the recurring need for renovation, refurbishment and improvement of the properties;

increases in interest rates and inflation;

weaknesses in the national, regional and local economies;

the adverse financial condition of some large retail and/or hospitality companies;

changes in wages, prices, energy costs and construction and maintenance costs that may result

from inflation, government regulations, changes in interest rates or currency fluctuations;

availability of financing for operating or capital requirements;

consolidation of retail or hotel operators in the retail or hospitality sectors;

strikes, work stoppages and labor-related disputes;

changes in consumer spending patterns;

changes in consumer preference in relation to property design and interior decoration or location;

unemployment levels;

an increase in consumer purchases from mail-order or internet purchases and consequent reduction

for retail;

competition from warehouse and outlet stores and competitors with new business models;

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transportation infrastructure developments in new areas;

decreases in the demand for hotel rooms and related lodging services, including a reduction in

business travel as a result of general economic conditions;

extreme weather conditions or acts of terrorism;

any changes in taxation and zoning laws; and

adverse government regulation.

The events described above are beyond our control and, could individually or together, have an adverse

effect on our business, results of operations and financial condition.

Further, the retail industry is a highly competitive industry with numerous participants, including individual

and chain fashion specialty stores, as well as international, regional and national department stores. Brand

recognition, fashion, price, service, store location, selection and quality are the principal competitive

factors in retail store and direct-to-consumer sales. The competitive challenges facing retailers include

anticipating and quickly responding to changing fashion trends and maintaining the aspirational positioning

of their brands so they can sustain their pricing positions. There can be no assurance that retailers operating

under fixed-or-percentage of sales leases or percentage of sales leases will be successful in generating

anticipated revenues from their sales and remaining competitive and any decline in a retailer‟s sales under a

fixed-or-percentage of sales lease or percentage of sales lease would adversely affect our rental income,

business, results of operations and financial condition.

17. Our business may suffer if we are unable to sustain the quality of our property management services.

As part of our business, we provide property management services to our completed retail and commercial

developments and we expect that we will provide property management services to the residential projects

that we are developing. These services include, among others, book keeping, security management,

building maintenance and the operation of leisure facilities such as swimming pools and fitness centers. We

believe that our property management services are an integral part of our business and are also important to

the successful marketing and promotion of our property developments. If customers of our property

management services elect to discontinue the services provided by us, our property management business

would be negatively affected, which in turn could adversely affect the attractiveness of our developments

and consequently, results of operations and financial condition.

18. We may experience volatility in prices of, or shortages of, key building materials.

Our ability to develop projects profitably is dependent upon our ability to source adequate building supplies

for use by our construction contractors. Any shortages in supply and volatility in prices of building

materials could arise from changes in import restrictions, such as changes to customs duties and licensing

policies, applicable to goods (such as certain building materials) imported into India. In addition, our

supply chain may be periodically interrupted by circumstances beyond our control, including work

stoppages and labor disputes affecting our suppliers, their distributors, or the transporters of our supplies.

During periods of shortages in building materials, such as cement and steel, we may not be able to

complete projects according to our previously established timelines, at our previously estimated project

cost, or at all, which could affect our results of operations and financial condition. In addition, during

periods of volatility in the price of building materials, where prices have increased significantly or

unexpectedly, we may not be able to pass the increase in construction costs through to our customers,

particularly as we generally aim to pre-sell a significant portion of our residential units prior to project

completion, which could reduce or eliminate the profits we attain with regards to our developments.

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19. Our plans to develop hotels within our retail developments are subject to risks inherent to such business

and other contingencies, and may not be successful.

Our success in developing hotel projects will depend on our ability to forecast and respond to demand in

the hospitality industry. The hospitality industry entails additional risks that are distinct from those

applicable to retail or commercial business, such as the branding of the hotel, the availability of hotel rooms

exceeding demand, the failure to attract and retain business and leisure travelers, as well as adverse

international, national or regional trends and security conditions. Further, operating margins may be

adversely affected by increases in electricity, insurance and environmental compliance expenses. Any of

these developments could have an adverse effect on our business, results of operations and financial

condition.

In addition, we have entered into a 29 year lease agreement for the hotel property we developed at Treasure

Island, Indore. We expect that we will enter into similar long-term lease agreements in the future with

respect to hotels under development. We will be subject to risks associated with these agreements. For

example, leasing arrangements are generally subject to renewal from time-to-time on mutually agreeable

terms, there may be a decrease in hotel property lease rates when we renew them. We may be unable to

renew such arrangements on terms that are favorable to us or that allow us to generate profit from the

relevant property. Further, the hotel operator may decide to terminate or not renew such arrangements.

20. We may not be able to successfully identify and acquire suitable land for future projects.

Our growth plans require us to develop retail, residential, hospitality and commercial developments in a

number of emerging cities in India. In order to maintain and grow our business, we will be required to

identify suitable land and purchase it for future development. Our ability to identify and acquire suitable

sites is dependent on a number of factors, some of which may be beyond our control. These factors include

the price and availability of suitable land, the willingness of land-owners to sell land on terms acceptable to

us, the ability to acquire contiguous parcels of land, the ability to obtain and complete an agreement to sell

from all the owners where the land has multiple owners, the availability and cost of financing,

encumbrances on targeted land, Government directives on land use and the obtaining of permits, consents

and approvals for land acquisition and development. The conveyance of land does not occur upon

executing the memorandum of understanding and the formal transfer of title to or interest in land by the

seller (at which time stamp duty becomes payable) is generally completed only after all the requisite

governmental consents and approvals have been obtained. Our acquisition of interests in land are therefore

also subject to the risk that sellers may, during such time, identify and transact with alternative purchasers

or decide not to sell the land. The failure to acquire targeted land may cause us to modify, delay or abandon

entire projects, which in turn could cause our business to suffer.

In addition, land acquisition in India has historically been subject to regulatory restrictions on foreign

investment. In addition to these restrictions being gradually relaxed, the aggressive growth strategies and

financing plans of real estate development companies as well as real estate investment funds in the country,

is likely to make suitable land increasingly expensive. If we are unable to compete effectively in the

acquisition of suitable land, our business and prospects will be adversely affected.

Additionally, once a potential development site has been identified, site visits and feasibility

studies/surveys are undertaken, which include detailed analyses of factors such as regional demographics,

analysis of current property development initiatives and market needs, and market trends. Such information

may not be accurate, complete or current. Any decision to acquire land which is based on inaccurate,

incomplete or outdated information or any change in circumstances may result in certain risks and

liabilities associated with the acquisition of such land, which could adversely affect our business, financial

condition and results of operations.

21. Our inability to procure contiguous parcels of land may affect our future development activities.

We acquire parcels of land and development rights over parcels of land in various locations from various

landholders, over a period of time, for future development. These parcels of land are subsequently

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consolidated to form a contiguous land mass, upon which we undertake development. In the past, we have

not experienced difficulties in procuring such parcels of land and consolidating them. However, we may be

unable to procure such parcels of land at all or on terms that are acceptable to us, which may affect our

ability to consolidate parcels of land into a contiguous mass. Failure to acquire such parcels of land may

cause delays or force us to abandon or modify the development of land in such locations, which may result

in our failing to realize our investment for acquiring such parcels of land. Accordingly, our inability to

procure contiguous parcels of land may adversely affect our business, results of operations, financial

condition and prospects.

22. We may enter into agreements with various third parties for the acquisition of land which may expire or

may be invalid which may lead to our inability to acquire these lands.

As part of our land acquisition process, we enter into purchase agreements or memoranda of understanding

with third parties prior to the transfer of interest or conveyance of title of the land. Although, we currently

do not have any purchase agreements or memoranda of understanding with third parties for the acquisition

of land, we may enter into such agreements as part of our projects. There can be no assurance that sellers of

land will be able to satisfy their conditions within the time frames stipulated, or at all. In addition, such

sellers may at any time decide not sell us the land identified.

In the event that we are unable to acquire this land, we may not be able to recover all or part of the advance

monies paid by us to these third parties. Further, in the event that these agreements are either held invalid or

have expired, we may lose the right to acquire these lands and also may not be able to recover the advances

made in relation to the land. Also, any indecisiveness on our part to perform our obligations or any delay in

performing our obligations under these agreements, may lead to us being unable to acquire these lands as

the agreements may also expire. Any failure to complete the purchases of land, renew these agreements on

terms acceptable to us or recover the advance monies from the relevant counterparties could adversely

affect our business, financial condition and results of operations.

23. We face uncertainty of title to properties owned by us or project-specific SPVs that will develop our

projects.

The difficulty of obtaining title guarantees in India means that title records provide only for presumptive

rather than guaranteed title. Property records in India have not been fully computerized and are generally

maintained and updated manually through physical records of all land-related documents. Accordingly,

existing land which is owned by us or owned by project-specific SPVs may have irregularities of title or

may be subject to, or affected by, encumbrances of which we may not be aware of. It is therefore difficult

to obtain and rely on accurate and up-to-date property records, which could delay or impede our

development. While we conduct due diligence and assessment exercises prior to acquiring land and

undertaking a project, we or they may not be able to assess or identify all risks and liabilities associated

with the land, such as faulty or disputed title, unregistered encumbrances or adverse possession rights. The

uncertainty of title to land makes the acquisition and development process more complicated and may

impede the transfer of title, expose us to legal disputes and adversely affect our land valuations. Legal

disputes in respect of land title can take several years and considerable expense to resolve if they become

the subject of court proceedings and their outcome can be uncertain. If we or the owners of the land on

which the project is to be developed are unable to resolve such disputes with claimants, we and the project-

specific SPVs may lose the interests in the land. The failure to obtain good title to a particular plot of land

may adversely prejudice the success of a development for which that plot is a critical part and may require

us to write off expenditures in respect of the development and, as a result, could adversely affect our

business and prospects.

In addition, title insurance is not commercially available in India to guarantee title or development rights in

respect of land. The absence of title insurance, coupled with the difficulties in verifying title to land, may

increase our exposure to third parties claiming title to the property. Some of these lands may have

irregularities of title, such as non-execution or non-registration of conveyance deeds and inadequate

stamping, and may be subject to encumbrances of which we may not be aware.

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24. We may not be able to compete effectively, particularly in regional markets and in our new businesses,

which may adversely affect our profitability.

We operate our businesses in an intensely competitive and highly fragmented environment. We face

significant competition in our business from a large number of Indian retail, residential and commercial

real estate development and hospitality companies. See “Business - Competition” on page 96 of this Draft

Red Herring Prospectus. In our retail business, we and certain of our tenants compete with other retail

distribution channels, including department stores and other shopping centers, in attracting customers.

Some of our competitors are larger than us and may have a larger land bank and financial resources. They

may also benefit from greater economies of scale and operating efficiencies. Competitors may, whether

through consolidation or growth, present more credible integrated projects. The extent of the competition

we face in a potential project depends on a number of factors, such as the sector, the size and type of

project, the complexity and location of the project and our reputation. Increasing competition could result

in price and supply volatility, which could cause our business to suffer. There can be no assurance that we

can continue to compete effectively with our competitors in the future, and our failure to compete

effectively may have an adverse effect on our business, financial condition and results of operations.

In the hospitality sector, we will compete for lessees with other real estate developers in a highly

competitive industry. Our success will be dependant on our ability to compete in areas such as design,

quality of accommodation, location, favorable lease rates and brand recognition, among others. There can

be no assurance that new or existing competitors will not significantly lower their rates or offer greater

convenience, design or locations than those which we will be able to provide. Such developments would

affect our ability to compete with them and have a negative effect on our profitability and financial

condition.

We are a recent entrant into the Indian residential real estate market and our performance is heavily

dependent on our ability to buy suitable land at reasonable prices. We face significant competition from

other more established residential real estate developers, many of whom may be better known as pan India

real estate developers. Increasing competition in our residential business could result in price and supply

volatility, which could cause our business to suffer. There can be no assurance that we may compete

effectively with our competitors in the future, and failure to compete effectively may have an adverse effect

on our business, financial condition and results of operations.

25. We may not be successful in implementing our strategies, particularly our growth strategy.

The success of our business will depend greatly on our ability to effectively implement our business and

strategies. See “Business - Strategies” on page 80 of this Draft Red Herring Prospectus. Even if we have

successfully executed our business strategies in the past, there can be no assurance that we will be able to

execute our strategies on time and within the estimated budget, or that we will meet the expectations of

targeted customers. We expect our strategies to place significant demands on our management and other

resources and require us to continue developing and improving our operational, financial and other internal

controls. Our inability to manage our business and strategies could have an adverse effect on our business,

financial condition and profitability.

We are embarking on an ambitious growth strategy, which involves, equity interests in, and the

development of, one Treasure Market City, five Treasure Islands, three Treasure Bazaars and five Treasure

Towns and Treasure Vihar projects. In addition, we also expect to derive significant revenues from the

growth of our property management business. Our expansion and diversification is on a scale that is

unprecedented in our history and places significant demands on our management as well as our financial,

accounting and operating systems. We may not be able to sustain such growth in revenues and profits or

maintain a similar rate of growth in the future. Further, as we grow and diversify, we may not be able to

execute our projects efficiently, which could result in delays, increased costs and diminished quality and

may adversely affect our reputation. If we are unable to manage our growth effectively, our business and

financial results will be adversely affected.

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26. Our indebtedness and the conditions and restrictions imposed by our financing agreements could

adversely affect our ability to conduct our business and operations.

As of March 31, 2010, we had total consolidated debt of Rs.9,125.52 million. We may incur additional

indebtedness in the future. Our and the project-specific SPVs‟ indebtedness could have several important

consequences, including but not limited to the following:

a portion of our and the project-specific SPVs‟ cash flow may be used towards payment of the

principal of, and interest on, existing and future debt, which will reduce the availability of cash

flow to fund working capital, capital expenditures and other requirements;

our and the project-specific SPVs‟ ability to obtain additional financing in the future at reasonable

terms may be restricted;

fluctuations in market interest rates may affect the cost of our and the project-specific SPVs‟

borrowings, as some of our or the project-specific SPVs‟ indebtedness are at variable interest

rates;

there could be an adverse effect on our business, financial condition and results of operations if we

or the project-specific SPVs are unable to service the indebtedness or otherwise comply with

financial and other covenants specified in the financing agreements; and

we may be more vulnerable to economic downturns, may be limited in our ability to withstand

competitive pressures and may have reduced flexibility in responding to changing business,

regulatory and economic conditions.

The agreements and instruments governing ours and the project-specific SPVs‟ existing indebtedness and

the agreements we and the project-specific SPVs expect to enter into for future indebtedness, contain and

are likely to contain restrictions and limitations, such as restrictions on issuance of new shares or other

securities, incurring further indebtedness, creating further encumbrances on assets, disposing off assets,

effecting any scheme of amalgamation or restructuring, undertaking guarantee obligations, declaring

dividends or incurring capital expenditures beyond certain limits. In addition, some of these financing

agreements contain and are likely to contain financial covenants, which may require us or the project-

specific SPVs to maintain, among other things, a specified net worth to assets ratio, debt service coverage

ratio, and maintenance of collateral. Most of our and the project-specific SPVs‟ financing arrangements are

secured by our or the project-specific SPVs‟, as applicable, immovable and movable assets. Many of our

and the project-specific SPVs‟ financing agreements also include various conditions and covenants that

require us or them, as applicable, to obtain lender consents prior to carrying out certain activities and

entering into certain transactions. Failure to meet these conditions or obtain these consents could have

significant consequences on our business and operations.

27. We face risks inherent in concentrating our business on developing residential properties and

developing and managing urban shopping centers in emerging cities in India.

Our principal business strategy is to own, develop, manage and operate urban shopping centers and to

develop residential projects in emerging cities in India. Our strategy is premised on our belief that urban

shopping centers and residential properties in emerging cities in India will benefit from the significant

economic and consumer growth potential in India‟s emerging cities. We are also currently developing large

scale residential real estate developments, hotels and commercial office space, and intend to selectively and

strategically develop other large scale residential real estate developments, hotels and commercial office

space in the future. Accordingly, our principal business strategies expose us to the risks inherent in

concentrating our business in a single type of market. Other real estate companies that invest in more than

two or three types of project or over a wider geographical target may not face these risks to the same extent,

or at all. These risks include, but are not limited to, a downturn in emerging cities, which have smaller and

less developed consumer markets, decreases in rental or occupancy rates and insolvency of tenants and

xxv

other counterparties. These risks could affect the valuations of our shopping centers, restrict our ability to

raise funds for our business and result in higher financing costs. If any of these events were to occur, or the

potential economic and consumer growth in emerging cities that we anticipate does not materialize, our

business, financial condition and results of operations may be adversely affected.

28. Renovation, asset enhancement works, physical damage or latent building or equipment defects to our

properties may disrupt the operations of the properties and collection of rental income or otherwise

result in adverse effect on our financial condition.

The quality and design of a shopping center has an influence on the demand for space in, and the rental

rates of, the shopping center, as well as its ability to attract strong shopper traffic. Our shopping centers

may need to undergo renovation or asset enhancement works from time to time to retain their attractiveness

to tenants as well as shoppers and may also require unforeseen maintenance or repairs in respect of faults or

problems that may develop or as a result of new planning laws or regulations. The costs of maintaining a

retail property and the risk of unforeseen maintenance or repair requirements tend to increase over time as

the building ages. The business and operations of the properties may suffer some disruption and it may not

be possible to collect the full rate of, or, as the case may be, any rental income on space affected by such

renovation works. Shopper traffic may also be adversely affected by such renovation and/or repair works.

In addition, physical damage to our shopping centers resulting from fire or other causes and design,

construction or other latent defects in our shopping centers in which we have an interest may lead to

additional capital expenditure, special repair or maintenance expenditure, business interruption, or payment

of damages or other obligations to third parties, and may in turn result in an adverse effect on our business,

financial condition and results of operations.

29. Our revenues from our shopping centers and hospitality properties may fluctuate on a seasonal basis,

causing our results of operations from our shopping centers business to be susceptible to changes in

seasonal shopping patterns.

The retail real estate industry is seasonal in nature, with shopping center tenant sales highest in the third

quarter due to the Dusshera, Diwali and year-end season, and with lesser, though still significant, sales

fluctuations associated with the summer months of June, July and August and the back-to-school period.

While our fixed-price shopping center leases are generally not subject to seasonal factors, our fixed-or-

percentage of sales leases and percentage of sales leases are affected by seasonal factors, and the majority

of new stores open in the second half of the year in anticipation of the Diwali selling season. Accordingly,

revenues and occupancy levels are generally highest in the third quarter. As a result of this seasonality, our

revenues for our shopping center business during any fiscal quarter cannot be used as an accurate indicator

of our financial year results.

The hotel industry is seasonal in nature and the periods during which our hotel tenants experience higher

revenue vary from property to property and depend principally upon location. As a result of this

seasonality, our revenues for our hospitality properties during any fiscal quarter cannot be used as an

accurate indicator of our financial year results.

30. The historical financial results included in this Draft Red Herring Prospectus may not be accurate

indicators of our future performance.

Our consolidated operating results may differ significantly from period to period due to factors such as the

launch of new projects, delays or difficulties in increasing our developed properties, changes in the real

estate market and inaccurate estimates of the resources and time required to complete Ongoing and

Forthcoming Projects or maintain and operate Completed Projects. Due to the foregoing factors, it is

possible that in some future financial quarters our operating results may be significantly below the

expectations of the market, analysts and investors and / or different from those in previous quarters.

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31. We recognize revenue based on the percentage of completion method of accounting on the basis of our

management’s estimates of revenues and development costs on a property by property basis. As a result,

our revenues and development costs may fluctuate significantly from period to period.

We recognize the revenue generated from our residential and commercial projects on the percentage of

completion method of accounting. Under this method, revenue recognized with respect to a property

development, is equal to the lower of (a) the percentage of completion of the property and (b) actual

amount received on booking or sale of the property as a percentage of total estimated property sales. The

percentage of completion of a property is determined on the basis of portion of the actual cost of the

property incurred thereon, including cost of land, as against the total estimated cost of the property under

execution. We cannot assure you that the estimates used under the percentage of completion method will

equal either the actual cost incurred or revenue received with respect to these projects. The effect of such

changes to estimates is recognized in the financial statements of the period in which such changes are

determined. This may lead to significant fluctuations in revenues and development costs and limit our

ability to undertake new projects. Therefore, we believe that period-to-period comparisons of our results of

operations are not necessarily meaningful and should not be relied upon as indicative of our future

performance. Such fluctuations in our revenues and costs could also cause our share price to fluctuate

significantly.

32. Certain information in this Draft Red Herring Prospectus is based on management estimates which may

change, and industry, statistical and financial data contained in this Draft Red Herring Prospectus may

be incomplete or unreliable.

Certain information contained in this Draft Red Herring Prospectus, such as the amount of land or the

location and type of development, the Leaseable Area, Saleable Area and Developable Area, estimated

construction commencement and completion dates, estimated construction costs, our funding requirements

and our intended use of proceeds of the Issue, is based solely on management estimates and our business

plan and has not been appraised by any bank, financial institution or independent agency. The total area of

property that is ultimately developed and the actual total Leaseable or Saleable Area may differ from the

descriptions of the property presented herein and a particular project may not be completely booked, sold,

leased or developed until a date subsequent to the expected completion date.

We may also have to revise our funding estimates, development plans (including the type of proposed

development) and the estimated construction commencement and completion dates of our projects

depending on future contingencies and events, including, among others:

changes in laws and regulations;

competition;

receipt of statutory and regulatory approvals and permits;

irregularities or claims with respect to title to land or agreements related to the acquisition of land;

the ability of third parties to complete their services on schedule and on budget;

delays, cost overruns or modifications to our ongoing and planned projects;

commencement of new projects and new initiatives; and

changes in our business plans due to prevailing economic conditions.

In addition, while facts and other statistics in this Draft Red Herring Prospectus relating to India, the Indian

economy, as well as the Indian real estate sector have been based on various publications and reports from

agencies that we believe are reliable, we cannot guarantee the quality or reliability of such materials.

xxvii

Industry facts and other statistics have not been prepared or independently verified by us or any of our

respective affiliates or advisers and, therefore we make no representation as to their accuracy or

completeness. These facts and other statistics include the facts and statistics included in “Industry

Overview” on page 58 of this Draft Red Herring Prospectus. Due to possibly flawed or ineffective data

collection methods or discrepancies between published information and market practice, the statistics

herein may be inaccurate or may not be comparable to statistics produced elsewhere and should not be

unduly relied upon. Further, there is no assurance that they are stated or compiled on the same basis or with

the same degree of accuracy, as the case may be, in reports or other publicly available information prepared

by the same or different third party analysts.

33. The estimated total Developable Area and Leaseable or Saleable Areas with respect to our Ongoing

Projects and Forthcoming Projects are based on existing real estate regulations and current

development plans, and may differ from the actual total Leaseable or Saleable Area once these projects

are complete.

The estimated total Developable Area and Leaseable or Saleable Area data presented in this Draft Red

Herring Prospectus with respect to our Ongoing Projects and Forthcoming Projects has been estimated by

us on a best case basis, based on the occurrence of certain events and our estimation of certain favorable

conditions that we expect to occur, but over which we do not have control. Any change in these events,

conditions, regulations or plans may lead to changes in the estimated Developable Area and Leaseable or

Saleable Areas, including a reduction in such areas, which could adversely affect our business and results

of operations. The Developable Areas are based on the concept of “super built-up” areas, which are

theoretical loadings, based on our understanding and perception of existing market conditions. In addition,

our estimates with respect to such area necessarily contain assumptions that may not prove to be correct. If

our estimated Developable Area or Leaseable or Saleable Area proves to be greater than our actual

Developable Area or Leaseable or Saleable Area, our results may fail to meet expectations and our share

price and business could suffer.

34. If we are unable to retain or recruit senior management or key personnel, our business could suffer.

Our senior management and key personnel, many of whom have a number of years of experience with us or

in the industries in which we operate, are difficult to replace. Any loss or interruption of the services of

such senior management or key personnel, or our inability to recruit qualified additional or replacement

personnel, could adversely affect our business by triggering a shortage of personnel, increasing the work-

load amongst existing personnel and/or increasing our personnel costs. We generally employ our senior

management and key personnel pursuant to an appointment letter, which requires the employee to serve

only one month‟s notice. Moreover, none of our senior management and key personnel owns any key

person insurance when they resign their positions. We also do not have non-compete agreements with our

senior management and key personnel.

35. We have entered into, and will continue to enter into, transactions with related parties.

We have entered into various transactions with related parties, including our Promoters and Promoter

Group entities. These related party transactions include entering into development and other agreements,

payment and receipt of advances for purchase of land, payment of managerial remuneration, reimbursement

of costs and expenses, including civil and infrastructure costs, grant and repayment of loans and grant of

corporate guarantees and reimbursement of bank guarantee charges. Such transactions are made on an

arm‟s length basis on no less favorable terms than if such transactions were carried out with unaffiliated

third parties. These transactions in the present and future may potentially involve a conflict of interest

which may adversely affect our business or harm our reputation. For details of related party transactions,

see “Related Party Transactions” on page 160 of this Draft Red Herring Prospectus.

36. Our Promoter Group will continue to exercise significant influence over us, and their interests in our

business may be different to those of other shareholders.

As of the date of this Draft Red Herring Prospectus, our Promoters and Promoter Group hold 66.98% of the

xxviii

issued and outstanding Equity Shares. Immediately following this Issue, but assuming no other changes in

shareholding, our Promoters and Promoter Group will own 37,549,606 Equity Shares (representing 28.94%

of our issued and outstanding equity shares). As such, our Promoter Group exercises and will continue to

exercise significant influence over our business, policies and affairs and all matters requiring a

shareholders‟ vote. This concentration of ownership also may delay, defer or even prevent a merger,

acquisition or change in control of us and may make some transactions more difficult or impossible without

the support of these shareholders. We cannot assure you that the interests of our Promoter Group may not

conflict with the interests of other shareholders and they could take decisions that may adversely affect our

business operations and the value of your investment in the Equity Shares.

37. Contingent liabilities could adversely affect our financial condition.

As of March 31, 2010, we had contingent liabilities in the following amounts, as disclosed in our

consolidated financial statements:

Particulars (Rs. in

million)

Bank guarantees outstanding……………………………………………………………. 103.16

Guarantees on behalf of other companies………………………………………………… 9,757.68

Demands of income tax authorities disputed in appeal……………………………………

Amount deposited by the Company against above demand………………………………

63.64

14.88

Demands of Sales tax authorities disputed in appeal……………………………………. 2.90

Obligation under “Export Promotion of Capital Goods Scheme” of the Central

Government……………………………………………………………………….............. 525.07

Service tax on rent from commercial properties…………………………………………. 54.04

Claim from Madhya Pradesh Housing Board on account of dispute …………………….. 115.00

Any or all of these contingent liabilities and commitments may become actual liabilities. If these contingent

liabilities materialize, our business and financial condition could be adversely affected. See “Financial

Statements” and “Outstanding Litigation and Material Developments” on pages 162 and 288 of this Draft

Red Herring Prospectus.

38. Our transition to IFRS reporting could have an adverse effect on our reported results of operations or

financial condition.

Public companies in India, including us, may be required to prepare annual and interim financial statements

under IFRS in accordance with the roadmap for the adoption of, and convergence with, IFRS announced by

the Ministry of Corporate Affairs, Government of India through press note dated January 22, 2010 (the

“Press Release”) and the clarification thereto dated May 4, 2010 (together with the Press Release, the

“IFRS Convergence Note”). Pursuant to the IFRS Convergence Note, all companies having a net worth in

excess of Rs.5,000.00 million and below Rs.10,000.00 million as of March 31, 2009, will be required to

convert their opening balance sheets as at April 1, 2013 (if the financial year commences on or after April

1, 2013) in compliance with the notified accounting standards which are convergent with IFRS.

Accordingly, we may be required to prepare our annual and interim financial statements under the

accounting standards which are convergent with IFRS from April 1, 2013. We have not yet determined

with any degree of certainty what impact the adoption of IFRS will have on our financial reporting.

Our financial condition, results of operations, cash flows or changes in shareholders‟ equity may appear

materially different under IFRS than under Indian GAAP or our adoption of IFRS may adversely affect our

reported results of operations or financial condition.

In addition, in our transition to IFRS reporting, we may encounter difficulties in the ongoing process of

implementing and enhancing our management information systems. Moreover, our transition may be

hampered by increasing competition and increased costs for the relatively small number of IFRS

experienced accounting personnel available as more Indian companies begin to prepare IFRS financial

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statements.

39. We are subject to third-party litigation risk by visitors, contractors and tenants of our shopping centers

which could result in significant liabilities and damage our reputation.

In general, as landlord, owner and manager of our shopping centers, we are exposed to the risk of litigation

or claims by visitors, contractors or tenants of our shopping centers, which may arise for a variety of

reasons, including any accidents or injuries that may be suffered by them while at our properties, our

tenants‟ inability to enjoy the use of the properties in accordance with the terms of their lease and our

failure to perform any of our obligations under any lease, construction or other contracts or agreements

entered into with contractors, tenants or other third parties. If we are required to bear all or a portion of the

costs arising out of litigation or investigations as a result of inadequate insurance proceeds or failure to

obtain indemnification from the owners of shopping centers we may manage, this may have an adverse

effect on our business, financial condition and results of operations.

40. Our insurance coverage may not adequately protect us against certain risks to or claims by our

employees, and we may be subject to losses that might not be covered in whole or in part by existing

insurance coverage.

We maintain insurance for a variety of risks, including for fire and allied perils, contractors‟ all risk

protection, third party liability, theft, certain other eventualities and director and officer liability. However,

there are various other types of risks and losses for which we are not insured, such as loss of business and

environmental liabilities, because they are either uninsurable or not insurable on commercially acceptable

terms. Should an uninsured loss or a loss in excess of insured limits occur, we could incur liabilities, lose

capital invested in that property or lose the anticipated future income derived from that business or

property, while remaining obligated for any indebtedness or other financial obligations related to our

business. Any such loss could result in an adverse effect to our financial condition. Furthermore, in the

future we may not be able to maintain insurance of the types or at levels which we deem necessary or

adequate. Moreover, any payments we make to cover any losses, damages or liabilities or any delays we

experience in receiving appropriate payments from our insurers could have an adverse effect on our

financial condition and results of operations. Any such uninsured losses or liabilities could result in an

adverse effect on our business operations, financial conditions and results of operations.

41. We operate in a highly regulated environment, and existing and new laws, regulations and Government

policies affecting the sectors in which we operate could adversely affect our operations and our

profitability.

The real estate sector in India is heavily regulated by the central, state and local Governments. Real estate

developers are therefore required to comply with various Indian laws and regulations, including policies

and procedures established and implemented by local authorities. Regulatory authorities may allege that we

are not in compliance with applicable laws and regulations and may subject us to regulatory action

including penalties, seizure of land and other civil or criminal proceedings. We may also not be able to

adapt to new laws, regulations or policies that may come into effect from time to time with respect to the

real estate sector, which may cause a delay in the implementation of our projects. For details, see

“Regulations and Policies” and “Government Approvals” on pages 100 and 295, respectively of this Draft


In particular, we are subject to various national and local laws and regulations relating to the protection of

the environment. These may require us to investigate and clean-up hazardous or toxic substances and

materials at a property and be liable for the costs of removal or remediation of such substances and

materials. Such liability may be imposed irrespective of whether we knew of, or were responsible for, any

environmental damage or pollution or the presence of such substances and materials. The cost of

investigation, remediation or removal of these substances and materials may be substantial. Environmental

laws may also impose compliance obligations on owners and operators of real property with respect to the

management of hazardous materials and other regulated substances. Failure to comply with these laws can

result in penalties or other sanctions and we cannot assure you that we will be completely in compliance

xxx

with these regulatory requirements at all times.

Environmental reports that we may request a third party to prepare with respect to any of our properties

may not reveal all environmental liabilities or material environmental conditions. Material environmental

conditions, liabilities or compliance concerns may also arise after a review has been completed or may arise

in the future. In addition, future laws, ordinances or regulations and future interpretations of existing laws,

ordinances or regulations may impose additional environmental liability. We may therefore be subject to

costs, liabilities or penalties relating to environmental matters which could adversely affect our business,

financial condition and results of operations.

42. We require regulatory approvals in the ordinary course of our business, and the failure to obtain them

in a timely manner, or at all, may adversely affect our operations.

We require regulatory approvals, licenses, registrations and permissions to develop our projects. These

approvals, licenses, registrations and permissions are required from central and state Governments and their

agencies. In addition, some of the regulatory approvals, licenses, registrations and permissions required for

operating our businesses differ from jurisdiction to jurisdiction and expires from time to time. We may

encounter difficulties in fulfilling the conditions precedent to the approvals described above or any

approvals that we may require in the future, some of which are onerous and may require us to incur

substantial expenditure that we may not have anticipated. We may also not be able to adapt to new laws,

regulations or policies that may come into effect from time to time with respect to the property industry in

general or the particular processes with respect to the granting of the approvals. There may also be delays

on the part of the administrative bodies in reviewing our applications and granting approvals or the

approvals issued to us may be suspended or revoked in the event of non-compliance or alleged non-

compliance with any terms or conditions thereof, or pursuant to any regulatory action. We generally apply

for renewals of such regulatory approvals, licenses, registrations and permissions prior to or upon their

expiry. However, we cannot assure you that we will obtain all regulatory approvals, licenses, registrations

and permissions that we may require in the future, or receive renewals of existing or future approvals,

licenses, registrations and permissions in the time frames required for our operations, or at all. For example,

we have not received approval for building construction permission for our retail projects at Amaravati,

Nanded and Thiruvananthapuram and we have not received approval to convert our land parcels for our

residential township project in Indore (at Kanadia) from agricultural land to residential land, due to which

the schedule of development and sale of projects could be substantially delayed or impeded, which could

adversely affect our business. See “Government Approvals” on page 295 of this Draft Red Herring

Prospectus.

43. Taxes and other levies imposed by the central or state Governments, as well as other financial policies

and regulations, may have an adverse effect on our business, financial condition and results of

operations.

We are subject to a number of taxes and other levies imposed by the central or state Governments in India,

particularly, property tax regimes in jurisdictions in which we operate, stamp duty, service tax on lease of

properties, as well as certain other taxes, duties or surcharges introduced on a permanent or temporary basis

from time to time. The Central and state tax scheme in India is extensive and subject to change from time to

time. Any adverse changes in any of the taxes levied by the central or state Governments may adversely

affect our competitive position and profitability. Any such changes in the incidence or rates or property

taxes or stamp duty or service or other value added tax could have an adverse affect on our financial

condition and results of operations.

44. The Government may exercise rights of compulsory purchase or eminent domain in respect of our lands.

We are subject to the risk that central and state Governments in India may exercise their rights of eminent

domain, or compulsory purchase in respect of lands. The Land Acquisition Act, 1894 allows the central and

state Governments to exercise rights of eminent domain or compulsory purchase, which, if used in respect

of our land, could require us to relinquish land with minimal compensation. The likelihood of such actions

may increase as the central and state Governments seek to acquire land for the development of

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infrastructure projects such as roads, airports and railways. Any such action in respect of one or more of

our major current or proposed developments could adversely affect our business.

45. Disruptions and other impairment of our information technologies and systems could adversely affect

our business.

Any disruption or other impairment in our information technology capabilities could harm our business.

Our business depends upon the use of sophisticated information technologies and systems for tenant sales

tracking systems, property management, communications, procurement, tenant record databases and

administrative systems. We cannot assure you that we will be able to continue to operate effectively and

maintain such information technologies and systems.

In addition, our information technologies and systems are vulnerable to damage or interruption from

various causes, including power losses, computer systems failures, Internet and telecommunications or data

network failures, computer viruses, hacking and similar events. We maintain certain disaster recovery

capabilities for critical functions in our business. However, we cannot assure you that these capabilities will

successfully prevent a disruption to or an adverse effect on our business or operations in the event of a

disaster or other business interruption. Any extended interruption in our technologies or systems could

significantly curtail our ability to conduct our business and generate revenue.

46. We had negative net cash flows from operating activities in the past and may do so in the future, which

may adversely affect our financial condition and results of operations.

Our net cash flows from operating activities for financial years 2010, 2008, 2007 and 2006 were negative,

amounting to Rs.919.50 million, Rs.1,494.51 million, Rs.166.04 million and Rs.367.38 million,

respectively. We anticipate that in the current operating environment, the domestic credit market for real

estate development activities remains challenging, as does the demand scenario from customers. We may

therefore experience negative cash flows from operating activities in the future which would adversely

affect our financial condition and results of operations.

47. Advance bookings for properties in our residential projects could be delayed or cancelled, which may

adversely affect our operating cash flows and income.

Advance bookings for properties in our residential projects could be delayed or cancelled, which may

adversely affect our operating cash flows and income. As of March 31, 2010, aggregate advance bookings

for our three launched residential township projects, Treasure Town and Treasure Vihar projects at AB

Road and Rangawasa in Indore and at Kharol Colony in Udaipur, was Rs.1,837.00 million. Advance

bookings do not necessarily indicate future earnings related to the delivery of booked properties but merely

refer to expected future income under signed contracts. Where our residential projects are delayed beyond

the scheduled completion date, our customers may have a right to cancel their bookings. In addition, we

may cancel bookings where our customers fail to make installment payments. Any delay, cancellation or

payment default may adversely affect our operating cash flows and income.

48. We recognize income from bookings in our residential projects and upon the occurrence of certain

events, we may be required to reverse some of the income recognized from such bookings.

We recognize income from the bookings for properties in our residential projects. The income from these

bookings constitute 46.94% of our total income for the financial year 2010. If our residential projects are

delayed beyond the scheduled completion date, our customers have a right to cancel their bookings. If our

customers cancel their bookings, we may be required to reverse the income recognized from these

bookings. If an increasing number of bookings are cancelled in respect of projects where we have

recognized income, our business, financial condition and results of operations could be adversely affected.

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49. Certain of our Group Companies have incurred losses or have had negative net worth in last three fiscal

years.

As set forth below, some of our Group Companies have incurred losses or have had negative net worth

during last three fiscal years (as per their respective standalone financial statements). They may continue to

incur losses in future periods, which may have an adverse effect on our results of operations.

The details of the Group Companies which have incurred losses in last three fiscal years are provided in the

following table:

(Rs. in million)

Sr.

No.

Name of the Group Company Profit/(Loss) after tax for the financial year

2009 2008 2007 1. Dreamworld Developers Private Limited 0.03 (0.02) (0.01) 2. Fantasy Real Estates Private Limited 0.23 (0.20) (0.003) 3. Four Dimension Properties Private Limited (0.41) (0.02) 0.004 4. Triple A Real Estates Private Limited 0.48 (0.02) (0.008)

The details of the Group Companies which have had negative net worth during last three fiscal years are

provided in the following table:

(Rs. in million)

Sr.

No.

Name of the Group Company Net worth for the financial year

2009 2008 2007 1. Fantasy Real Estates Private Limited 1.11 (0.12) 0.08 2. Crystal 3 Power Private Limited (0.28) - - 3. Four Dimension Properties Private Limited (0.33) 0.08 0.10

For further details on these Group Companies, see “Group Companies” on page 155 of this Draft Red

Herring Prospectus.

50. The Company has advanced unsecured loans to its Subsidiaries which involves a substantial degree of

risk.

As of March 31, 2010, we have advanced Rs.526.63 million of unsecured loans repayable on demand to

our Subsidiaries. These investments may be illiquid and we may not be able to realize any benefits or may

have to defer their realization potentially for a considerable period of time. Further, we may incur

additional costs or be unable to participate in other opportunities which may adversely affect our business,

financial condition and results of operations. The loans advanced to our Subsidiaries may not be repaid on a

timely basis or at all.

51. As a holding company for certain of our operations and assets, we depend on the availability and

upstream payment of cash from our Subsidiaries and project-specific SPVs.

We hold certain of our assets and interests indirectly through intermediate subsidiaries and project-specific

SPVs. Our cash flow will depend upon the cash of our operating subsidiaries and the payment of funds by

our operating subsidiaries to us.

Our operating subsidiaries and project-specific SPVs‟ ability to make any distributions or other payments

to us will depend on their profits, business and tax considerations and legal restrictions. Furthermore,

covenants in the financing arrangements governing the debt of our Subsidiaries and project-specific SPVs

restrict their ability to make distributions or other payments to us, which could adversely affect our


Further, in the event of a default under our Subsidiaries‟ and/or project-specific SPVs‟ credit facilities or

other financing arrangements, our Subsidiaries‟ and/or our project-specific SPVs‟ creditors could elect to

declare all amounts borrowed, together with accrued and unpaid interest and other fees, to be due and

xxxiii

payable. In such an event, our Subsidiaries‟ and/or our project-specific SPVs‟ credit facilities or other debt

financing arrangements will not permit our Subsidiaries and/or project-specific SPVs to distribute funds to

us. Any default under our Subsidiaries‟ and/or project-SPVs credit facilities would adversely affect our


52. We have not entered into any definitive agreements to use a substantial portion of the net proceeds of the

Issue towards construction of certain of our Ongoing Projects and the proceeds which we intend to

utilize for general corporate purposes may constitute more than 25.00% of the net proceeds of the Issue.

We have not entered into any definitive agreements to use a substantial portion of the net proceeds of the

Issue towards construction of certain of our Ongoing Projects. Our use of the proceeds of the Issue is at the

discretion of our Board of Directors and is not subject to monitoring by an independent monitoring agency

since the Issue Size is less than Rs.5,000.00 million. As described in “Objects of the Issue” on page 38 of

this Draft Red Herring Prospectus, we intend to use a portion of the proceeds from the Issue towards the

construction of certain of our Ongoing Projects, purchase of a portion of unsecured fully convertible

debentures issued by TWDPL from IAF - III, IAF - IV and PML and for general corporate purposes. We

may not be able to conclude the purchase of such debentures or such projects on the terms or within the

time or budget anticipated by us, or at all. Further, we have not specifically identified the general corporate

purpose for which we intend to utilize a portion of the net proceeds and the use of such proceeds will be at

the discretion of the Board of Directors and, may exceed 25.00% of the net proceeds of the Issue.

53. We may undertake acquisitions, investments, strategic relationships or divestments in the future, which

may pose management and integration challenges.

We may undertake acquisitions, investments, strategic relationships and divestments in the future as part of

our growth strategy in India. These activities may not necessarily contribute to our profitability and may

divert the attention of our management or require us to assume high levels of debt or contingent liabilities,

as part of such transactions. In addition, we could experience difficulty in combining operations and

cultures and may not realize the anticipated synergies or efficiencies from such transactions. These

difficulties could disrupt our ongoing business, distract our management and employees and increase our

expenses.

54. Our business will be adversely affected if mortgage financing becomes more costly or otherwise less

attractive or available.

Substantially all purchasers of our residential properties rely on mortgages to fund their purchases. An

increase in interest rates may significantly increase the cost of mortgage financing and affect the

affordability of residential properties. In addition, the Reserve Bank of India and consumer banks may also

increase the down-payment requirements, impose other conditions or otherwise change the regulatory

framework in a manner that would make mortgage financing unavailable or unattractive or less available or

less attractive to potential property purchasers. If the availability or attractiveness of mortgage financing is

reduced or limited, many of our prospective customers may not be able to purchase our properties and, as a

result, our business, financial condition and results of operations could be adversely affected.

55. Some of the marks used by us are not registered and the inability to use any such mark could adversely

affect our business and results of operations.

The brands and trademarks “TREASURE”, “TREASURE MARKET CITY”, “TREASURE ISLAND”,

“TREASURE BAZAR” and “TREASURE TOWN” and their associated logos are owned by us, and we are

the registered owner of the trademarks. Some of the marks used by us such as “Treasure Vihar” are not

registered, though applications have been made for their registration, and as a result, third parties could

attempt to stop us from using such marks or claim damages for the infringement by us for using such

marks. The inability to use any such marks could adversely affect our business and results of operations.

The infringement or the inability to register our trademarks, logo and other intellectual property rights

could adversely affect our business. Our intellectual property rights are important to our brand and we

believe the strength of our brand gives us a competitive advantage. We use our intellectual property rights

xxxiv

to protect the goodwill of our brand, promote our brand name recognition, enhance our competitiveness and

otherwise support our business goals and objectives. We cannot assure you that the steps we take to obtain,

maintain and protect our intellectually property rights will be adequate.

56. There may be potential conflicts of interests between us, our Directors and our Promoters, who have

interests in the real estate industry.

Our Promoters are engaged in the investment in, and the development and management of, among other

things, a large portfolio of properties, including retail properties. Some of our Directors are on the board of

various other companies engaged in the real estate industry. As a result, there may be circumstances where

our investments compete directly with the other retail properties that our Promoters operate (by itself or

with another joint venture partner).

Our Promoters may compete with us, in the same industries, businesses and locations in which we operate,

and we cannot assure you that conflicts of interests between us and our Promoters would not arise. Such

conflicts could adversely affect our prospects, business, results of operations and financial condition.

57. We may be involved in legal and administrative proceedings arising from our operations from time to

time.

We may be involved from time to time in disputes with various parties involved in the development and

sale of our properties, such as contractors, sub-contractors, suppliers, joint venture partners, occupants, and

claimants of title over land and governmental authorities. These disputes may result in legal and/or

administrative proceedings, and may cause us to suffer litigation costs and project delays. We may, for

example, have disagreements over the application of law with regulatory bodies or third parties in the

ordinary course of our business, which may subject us to administrative proceedings and unfavorable

decisions, resulting in financial losses and the delay of commencement or completion of our projects. Such

litigation may result in delays and additional costs to our projects, and could, in turn, adversely affect our


RISKS RELATING TO INDIA

58. A slowdown in economic growth in India could cause our business to suffer.

Our performance and growth are dependent on the health of the Indian economy. The economy could be

adversely affected by various factors including political or regulatory action, including adverse changes in

liberalization policies, social disturbances, lack of credit or other financing, terrorist attacks and other acts

of violence or war, natural calamities, increase in interest rates, changes in fiscal or monetary policies

commodity and energy prices and various other factors. In addition to the factors set forth above, our

business may be affected by adverse changes specific to the residential and retail real estate markets.

Demand in the residential real estate market may be adversely affected by changes such as a decrease in

disposable income or a rise in residential mortgage rates or a decline in the population. The business may

also be affected by adverse changes specific to the retail industry, which has historically been and could be

in the future adversely affected by, the adverse financial condition of some large retail companies, ongoing

consolidation in the retail sector in India, the excess amount of retail space in a number of Indian regional

markets, an increase in consumer purchases through catalogues or the Internet and reduction in the demand

for tenants to occupy the shopping centers as a result of the Internet and ecommerce, the timing and costs

associated with property improvements and rentals, any changes in taxation and zoning laws and adverse

Government regulation. Any slowdown in the Indian economy may adversely affect our business and

financial performance and the price of the Equity Shares.

xxxv

59. Political instability or changes in the Government could delay the liberalization of the Indian economy

and adversely affect economic conditions in India generally, which could affect our financial results

and prospects.

Since 1991, successive Indian Governments have pursued policies of economic liberalization, including

significantly relaxing restrictions on the private sector. Nevertheless, the role of the Indian central and state

Governments in the Indian economy as producers, consumers and regulators has remained significant. The

leadership of India has changed many times since 1996. Currently and in the past, the central Government

has been a coalition of several political parties. Although the current Government has announced policies

and taken initiatives that support the economic liberalization policies that have been pursued by previous

Governments, the rate of economic liberalization could change, and specific laws and policies affecting real

estate, foreign investment and other matters affecting investment in our securities could change as well.

60. Foreign direct investment in the real estate sector in India under the automatic route is governed by a

policy statement which may be ambiguous in its terms.

FDI regulations impose certain conditions on investments in the real estate sector in India. Government

policy in respect of FDI in the real estate sector in India is regulated by Consolidated FDI Policy issued by

the Government of India, Ministry of Commerce and Industry, which permits foreign direct investment of

up to 100.00% subject to the project fulfilling certain specified conditions. The Consolidated FDI Policy,

however, are subject to differing interpretations. For example, foreign direct investment is subject to the

condition that for joint ventures with Indian partners the “minimum capitalization” should be US$5 million.

However, there is some ambiguity on what is meant by “minimum capitalization”. In addition, although the

Consolidated FDI Policy stipulate that funds have to be brought in within six months of “commencement of

business of the Company”, the term “commencement of business of the Company” has not been defined or

explained and may also be subject to different interpretations. Further, the Consolidated FDI Policy

provides guidelines in relation to the calculation of total foreign investment in Indian companies. The same

is subject to different interpretations and may be subject to amendments as reported in various news

articles. Our inability to raise additional capital as a result of these and other restrictions could adversely

effect our business and prospects. For more information on these restrictions, see “Regulations and

Policies” on page 100 of this Draft Red Herring Prospectus.

61. Terrorist attacks, civil unrest and other acts of violence or war involving India and other countries could

adversely affect the financial markets and our business.

Terrorist attacks such as the Mumbai terror attacks in November 2008 and other acts of violence or war

may negatively affect the Indian markets on which the Equity Shares trade and also adversely affect the

worldwide financial markets. These acts may also result in a loss of business confidence, and adversely

affect our business. In addition, any deterioration in relations between India and its neighboring countries

might result in investor concern about stability in the region, which could adversely affect the price of the

Equity Shares.

India has also witnessed civil disturbances in recent years and it is possible that future civil unrest as well

as other adverse social, economic and political events in India could have a negative effect on us. Such

incidents could also create a greater perception that investment in Indian companies involves a higher

degree of risk and could have an adverse affect on our business and the price of the Equity Shares.

62. Any downgrading of India’s sovereign debt rating by an independent agency may harm our ability to

raise debt financing.

Any adverse revisions to India‟s credit ratings for domestic and international debt by international rating

agencies may adversely affect our ability to raise additional financing and the interest rates and other

commercial terms at which such additional financing is available. This could have an adverse effect on our

capital expenditure plans, business and financial performance.

xxxvi

63. Natural calamities could have a negative effect on the Indian economy and cause our business to suffer.

India has experienced natural calamities such as earthquakes, a tsunami, floods and drought in the past few

years. The extent and severity of these natural disasters determines their effect on the Indian economy. For

example, the erratic progress of the monsoon in 2009 has affected sowing operations for certain crops.

Further prolonged spells of below normal rainfall or other natural calamities could have a negative effect

on the Indian economy, adversely affecting our business and the price of the Equity Shares.

64. Inflation may adversely affect our financial condition and results of operations.

If inflation increases in the future, we may experience any or all of the following:

difficulty in replacing or renewing expiring leases with new leases at higher rents;

decreasing tenant sales as a result of decreased consumer spending which could adversely affect

the ability of our tenants to meet their rent obligations and/or result in lower percentage rents; and

an inability to receive reimbursement from our tenants for their share of certain operating

expenses, including common area maintenance, real estate taxes and insurance.

India has experienced very high levels of inflation in the past with inflation at 10.16% in May 2010.

However, recently inflation has fallen to less than 1.00%. In the event of a high rate of inflation, our costs,

such as salaries, price of transportation, wages, raw materials or any other of our expenses may increase.

Further, we will not be able to adjust our costs or pass our costs which have been fixed along during

periods of lower inflation to our customers. Accordingly, high rates of inflation in India could increase our

costs, could have an adverse effect on our profitability and, if significant, on our financial condition.

65. Foreign investors are subject to foreign investment restrictions under Indian law.

Under the foreign exchange regulations currently in force in India, transfers of shares between non-

residents and residents are freely permitted (subject to certain exceptions) if they comply with the pricing

guidelines and reporting requirements specified by the RBI. If the transfer of shares is not in compliance

with such pricing guidelines or reporting requirements or fall under any of the exceptions, then the prior

approval of the RBI will be required. Additionally, shareholders who seek to convert the Rupee proceeds

from a sale of shares in India into foreign currency and repatriate that foreign currency from India will

require a no objection or a tax clearance certificate from the income tax authority. We cannot assure you

that any required approval from the RBI or any other Government agency can be obtained on any particular

terms or at all.

RISKS RELATING TO THE INVESTMENT IN THE EQUITY SHARES

66. The Equity Shares issued pursuant to the Issue may not be listed on the Stock Exchanges in a timely

manner, or at all, and any trading closures at the Stock Exchanges may adversely affect the trading

price of the Equity Shares.

In accordance with Indian law and practice, permission for listing and trading of the Equity Shares issued

pursuant to the Issue will not be granted until after the Equity Shares have been issued and allotted.

Approval for listing and trading will require that all relevant documents authorizing the issue of the Equity

Shares are submitted to the Stock Exchanges and there could therefore be a failure or delay in listing and

trading the Equity Shares on the Stock Exchanges. Any failure or delay in obtaining such approval would

restrict your ability to dispose of your Equity Shares.

The regulation and monitoring of Indian securities markets and the activities of investors, brokers and other

participants differ, in some cases significantly, from those in Europe and the U.S. The Stock Exchanges

have in the past experienced problems, including temporary exchange closures, broker defaults, settlements

xxxvii

delays and strikes by brokerage firm employees, which, if continuing or recurring, could affect the market

price and liquidity of the securities of Indian companies, including the Equity Shares, in both domestic and

international markets. A closure of, or trading stoppage on, either of the Stock Exchanges could adversely

affect the trading price of the Equity Shares.

67. After this Issue, the Equity Shares may experience price and volume fluctuations or an active trading

market for the Equity Shares may not develop.

The price of the Equity Shares may fluctuate after this Issue as a result of several factors, including

volatility in the Indian and global securities markets, the results of our operations, the performance of our

competitors, developments in the Indian real estate sector and changing perceptions in the market about

investments in the Indian real estate sector, adverse media reports on us or the Indian real estate sector,

changes in the estimates of our performance or recommendations by financial analysts, significant

developments in India‟s economic liberalization and deregulation policies, and significant developments in

India‟s fiscal regulations.

There has been no recent public market for the Equity Shares prior to this Issue and an active trading

market for the Equity Shares may not develop or be sustained after this Issue. Further, the price at which

the Equity Shares are initially traded may not correspond to the prices at which the Equity Shares will trade

in the market subsequent to this Issue.

68. There are restrictions on daily movements in the price of the Equity Shares, which may adversely affect

a shareholder’s ability to sell, or the price at which it can sell, the Equity Shares at a particular point in

time.

The price of the Equity Shares may be subject to a daily circuit breaker imposed by all stock exchanges in

India which does not allow transactions beyond a certain level of volatility in the price of the equity shares.

This circuit breaker operates independently of the index-based market-wide circuit breakers generally

imposed by the SEBI on the Indian stock exchanges. The percentage limit on the circuit breaker is set by

the stock exchanges based on the historical volatility in the price and trading volume of the equity shares.

The stock exchanges do not inform us of the percentage limit of the circuit breaker from time to time, and

may change it without our knowledge. This circuit breaker effectively limits upward and downward

movements in the price of the Equity Shares. As a result, shareholders‟ ability to sell the Equity Shares, or

the price at which they can sell the Equity Shares, may be adversely affected at a particular point in time.

69. Conditions in the Indian securities market may affect the price or liquidity of the Equity Shares.

The Indian securities markets are smaller than securities markets in more developed economies. Indian

stock exchanges have in the past experienced substantial fluctuations in the prices of listed securities. These

exchanges have also experienced problems that have affected the market price and liquidity of the

securities of Indian companies, such as temporary exchange closures, broker defaults, settlement delays and

strikes by brokers. In addition, the governing bodies of the Indian stock exchanges have from time to time

restricted securities from trading, limited price movements and restricted margin requirements. Further,

disputes have occurred on occasion between listed companies and the Indian stock exchanges and other

regulatory bodies that, in some cases, have had a negative effect on market sentiment. If similar problems

occur in the future, the market price and liquidity of the Equity Shares could be adversely affected.

70. The Equity Shares have never been publicly traded and the Issue may not result in an active or liquid

market for the Equity Shares.

Prior to the Issue, there has been no public market for the Equity Shares and an active public market for the

Equity Shares may not develop or be sustained after the Issue. Listing and quotation does not guarantee that

a trading market for the Equity Shares will develop or, if a market does develop, the liquidity of that market

for the Equity Shares. Although we currently intend that the Equity Shares will remain listed on the Stock

Exchanges, there is no guarantee of the continued listing of the Equity Shares. Failure to maintain our

xxxviii

listing on the Stock Exchanges or other securities markets could adversely affect the market value of the

Equity Shares.

The Issue Price of the Equity Shares is proposed to be determined following a book-building process and

discussion between the BRLMs and us on the Pricing Date and may not be indicative of prices that will

prevail in the trading market. You may not be able to resell your Equity Shares at a price that is attractive to

you.

71. Any future issuance of Equity Shares by us may dilute your shareholding and adversely affect the

trading price of the Equity Shares.

Any future issuance of Equity Shares by us may dilute your shareholding in us, may adversely affect the

trading price of the Equity Shares and could affect our ability to raise capital through an issue of our

securities. In addition, any perception by investors that such issuances or sales might occur could also

affect the trading price of the Equity Shares. Additionally, the disposal of Equity Shares by any of our

major shareholders or the perception that such sales may occur may significantly affect the trading price of

the Equity Shares. No assurance may be given that we will not issue Equity Shares or that such

shareholders will not dispose of, pledge or encumber their Equity Shares in the future.

72. You will not be able to sell immediately on an Indian stock exchange any of the Equity Shares you

purchase in the Issue.

The Equity Shares will be listed on the Stock Exchanges. Pursuant to Indian regulations, certain actions

must be completed before the Equity Shares can be listed and trading may commence. Investors‟ book

entry, or “demat”, accounts with depository participants in India are expected to be credited within three

Working Days of the date on which the Basis of Allotment is approved by the Designated Stock Exchange.

Thereafter, upon receipt of final approval from the Designated Stock Exchange, trading in the Equity

Shares is expected to commence within four Working Days of the date on which the Basis of Allotment is

approved by the Designated Stock Exchange. We cannot assure that the Equity Shares will be credited to

investors‟ demat accounts, or that trading in the Equity Shares will commence, within the time periods

specified above.

73. You may be subject to Indian taxes arising out of capital gains on the sale of the Equity Shares.

Under current Indian tax laws and regulations, capital gains arising from the sale of equity shares in an

Indian company are generally taxable in India. Any gain realized on the sale of listed equity shares on a

stock exchange held for more than 12 months will not be subject to capital gains tax in India if Securities

Transaction Tax (“STT”) has been paid on the transaction. STT will be levied on and collected by a

domestic stock exchange on which the equity shares are sold. Any gain realized on the sale of equity shares

held for more than 12 months to an Indian resident, which are sold other than on a recognized stock

exchange and on which no STT has been paid, will be subject to long term capital gains tax in India.

Further, any gain realized on the sale of listed equity shares held for a period of 12 months or less will be

subject to short term capital gains tax in India. Capital gains arising from the sale of the Equity Shares will

be exempt from taxation in India in cases where the exemption from taxation in India is provided under a

treaty between India and the country of which the seller is resident. Generally, Indian tax treaties do not

limit India‟s ability to impose tax on capital gains. As a result, residents of other countries may be liable for

tax in India as well as in their own jurisdiction on a gain upon the sale of the Equity Shares. In addition,

changes in the terms of tax treaties or in their interpretation, as a result of renegotiations or otherwise, may

affect the tax treatment of capital gains arising from a sale of Equity Shares.

74. Our ability to pay dividends in the future will depend upon future earnings, financial condition, cash

flows, working capital requirements, capital expenditures and restrictive covenants in our financing

arrangements.

We develop, manage, own, sell and operate retail, residential, commercial and hospitality real estate

xxxix

properties. Our future ability to pay dividends will depend on the earnings, financial condition and capital

requirements of our Company. Dividends distributed by us will attract dividend distribution tax at rates

applicable from time to time. We cannot assure you that we will generate sufficient income to cover our

operating expenses and pay dividends to our shareholders, or at all.

Our business is capital intensive and we may plan to make additional capital expenditures to complete the

real estate that we are developing. Our ability to pay dividends could also be restricted under certain

financing arrangements that we may enter into. We may be unable to pay dividends in the near or medium

term, and our future dividend policy will depend on our capital requirements and financing arrangements

for the real estate projects, financial condition and results of operations.

75. Significant differences exist between Indian GAAP and other accounting principles with which

investors may be more familiar.

Financial statements included in this Draft Red Herring Prospectus are prepared in conformity with Indian

GAAP. Indian GAAP differs in certain significant respects from International Financial Reporting

Standards, U.S. GAAP and other accounting principles and auditing standards with which prospective

investors may be familiar with in other countries. We do not provide a reconciliation of these financial

statements to IFRS or U.S. GAAP or a summary of principal differences between Indian GAAP, IFRS and

U.S. GAAP relevant to our business. Furthermore, we have not quantified or identified the impact of the

differences between Indian GAAP and IFRS or between Indian GAAP and U.S. GAAP as applied to these

financial statements. As there are significant differences between Indian GAAP and IFRS and between

Indian GAAP and U.S. GAAP, there may be substantial differences in the results of operations, cash flows

and financial positions discussed in this Draft Red Herring Prospectus, if the relevant financial statements

were prepared in accordance with IFRS or U.S. GAAP instead of Indian GAAP. The significant accounting

policies applied in the preparation of these financial statements are as set forth in notes to the audited

financial statements included in this Draft Red Herring Prospectus. Prospective investors should review the

accounting policies applied in the preparation of these financial statements, and consult their own

professional advisors for an understanding of the differences between Indian GAAP and IFRS and between

Indian GAAP and U.S. GAAP and how they might affect the financial information contained in this Draft


Prominent Notes to risk factors

(a) The Company was originally incorporated as R.M.M Construction Private Limited on July 22, 1999 and

the name of the Company has been changed six times thereafter, to R.M.M Construction Limited on June

29, 2001, then to Entertainment World Developers Limited on June 29, 2001, to Entertainment World

Developers Private Limited on February 28, 2003, to EWDPL India Private Limited on April 5, 2007, to

Entertainment World Developers Private Limited on September 2, 2008. Subsequently, the status of the

Company was changed to public limited company and its name was changed to Entertainment World

Developers Limited on February 5, 2010. For details of the changes in our name, see “History and Certain

Corporate Matters” on page 106 of this Draft Red Herring Prospectus.

(b) Public Issue of 38,928,943 Equity Shares for cash at a price of Rs. [●] per Equity Share (including a share

premium of Rs. [●] per Equity Share) aggregating to Rs. [●] million.

(c) The net worth of the Company on a consolidated basis was Rs. 3,539.60 million as of March 31, 2010.

(d) The average cost of acquisition of the Equity Shares by the Promoters is as follows:

Manish Kalani - Rs. 25 per Equity Share;

KBIPL - Rs. 4.15 per Equity Share; and

PHPL - Rs. 3.95 per Equity Shares.

xl

(e) The net asset value per Equity Share was Rs. 38.97 as at March 31, 2010 as per the Company„s

consolidated financial statements, as restated.

(f) For details of the Group Companies having business interests or other interests in the Company, see

“Related Party Transactions” on page 160 of this Draft Red Herring Prospectus.

(g) For details of transactions by the Company with the Group Companies or Subsidiaries during the last year,

the nature of transactions and the cumulative value of transactions, see “Related Party Transactions” on

page 160 of this Draft Red Herring Prospectus.

(h) Any clarification or information relating to the Issue shall be made available by the BRLMs and the

Company to investors at large and no selective or additional information will be available for any subset of

investors in any manner whatsoever. Investors may contact the BRLMs for any complaints, information or

clarification pertaining to the Issue.

(i) There has been no financing arrangement whereby the Promoter Group, the directors of the Promoter, the

Directors and their relatives have financed the purchase by any other person of securities of the Company

other than in normal course of the business of the financing entity during the period of six months

immediately preceding the date of filing of the Draft Red Herring Prospectus.

1

SECTION III: INTRODUCTION

SUMMARY OF INDUSTRY

The information in this section is derived from various government publications and industry sources. Neither us

nor any other person connected with the Issue has verified this information. Industry sources and publications

generally state that the information contained therein has been obtained from sources generally believed to be

reliable, but that their accuracy, completeness and underlying assumptions are not guaranteed and their reliability

cannot be assured and, accordingly, investment decisions should not be based on such information.

We have also relied on reports prepared by Jones Lang Lasalle Meghraj (“JLLM”), entitled Residential

Opportunities in Central India, dated January 10, 2010 and Retail: Off the Beaten Track dated January 10, 2010

(together, the “JLLM Reports”). We commissioned the JLLM Reports for the purposes of confirming our

understanding of the industry in connection with the Issue. Neither we nor any other person connected with the Issue

has verified the information in the JLLM Reports.JLLM has advised that: (i) some information in JLLM database is

derived from estimates or subjective judgments; (ii) the information in the databases of other similar agencies may

differ from the information in JLLM database; (iii) while JLLM has taken reasonable care in the compilation of the

statistical and graphical information and believes it to be accurate and correct, data compilation is subject to

limited audit and validation procedures and may accordingly contain errors; (iv) JLLM, its agents, officers and

employees do not accept liability for any loss suffered in consequence of reliance on such information or in any

other manner; (v) the provision of such information does not obviate any need to make appropriate further

enquiries; and (vi) the provision of such information is not an endorsement of any commercial policies or any

conclusions by JLLM. Prospective investors are advised not to unduly rely on the JLLM Reports when making their

investment decision. The JLLM Reports contain estimates of market conditions based on samples. This information

should not be viewed as a basis for investment and references to the research should not be considered JLLM’s

opinion as to the value of any security or the advisability of investing in us.

Growth in the Indian Economy

India is the world‟s largest democracy by population size and one of the fastest growing economies in the world.

India‟s estimated population was approximately 1.16 billion people as of July 2009. India had an estimated Gross

Domestic Product (“GDP”) on a purchasing power parity basis of approximately US$ 3.3 trillion in 2008, making it

the fifth largest economy in the world after the European Union, United States of America, China and Japan.

(Source: CIA World Factbook) In the past few years, India has experienced rapid economic growth, with GDP

growing at an average growth rate of 8.8% between the fiscal year 2003 to the fiscal year 2007. This high growth

rate was slowed in the fiscal year 2009 with the growth rate of India‟s GDP decelerating to 6.7%, compared to 9.0%

in fiscal 2008, as a result of the global economic downturn. (Source: RBI, Macroeconomic and Monetary

Developments: Third Quarter Review 2009-10)

However, despite the global economic decline in the fiscal year 2008, India is showing positive signs of recovery

following the global economic downturn. Based on the Economic Outlook for fiscal 2010 by the Economic

Advisory Council to the Prime Minister, the Indian Economy may grow by about 7.2% in the fiscal year 2010 and

return to a 9% growth rate in the next two years. The world GDP growth rate for 2010 is estimated at 4.0%

according to the World Economic Outlook, January 2010 published by IMF.

The graph below is a comparison between India‟s expected GDP growth rate during calendar years 2009 and 2010,

as compared to advanced economies, developing economies, China and the world. As shown by the graph, all of the

countries are expected to experience positive growth in the calendar year 2010. This is due to the fact that economic

conditions have improved more than expected, owing mainly to Government intervention. Further, India‟s growth is

expected to outperform advanced and developing economies. Recent data suggests that the rate of decline in

economic activity is moderating, although this is occurring to varying degrees across different regions. Overall,

liquidity has improved and capital market activity has picked up substantially across the world.

2

3.0%

-0.8%

3.9%

-3.2%

2.1%

6.1%

2.1%

6.0%

7.3%

5.6%

7.7%

9.6%

8.7%

10.0%

0.5%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

2008 2009 2010

World Advanced Economies Developing Economies India China

Source: International Monetary Fund, World Economic Outlook Update, January 2010 (Calendar Year Growth Rates)

India‟s recovery from the global economic slowdown (and its own slowdown in credit availability) has been by the

country‟s large domestic savings and corporate retained earnings, which have been used to finance investment.

Similarly, although urban consumption has slowed as a result of a recent decline in the labor market and job losses,

low export dependence, large rural consumption and employment have helped India to sustain consumption. Finally,

fiscal policy, primarily in the form of reduced interest rates and Government intervention, has helped to maintain

private demand, liquidity and short-term rates, thereby reducing the risk of loan losses.

The Real Estate Sector in India

The real estate sector in India comprises the development of residential housing, commercial buildings, hotels,

restaurants, cinemas, retail outlets and the purchase and sale of land and development rights. The real estate and

construction sector play an important role in the overall development of India‟s core infrastructure. It also plays a

significant role in the country's economy. The real estate sector is second only to agriculture in terms of employment

generation and contributes heavily towards the GDP. Almost five per cent of the country's GDP is contributed to by

the housing sector. In the next five years, this contribution to the GDP is expected to rise to 6 per cent. (Source:

India Brand Equity Forum, www.ibef.org)

The real estate sector has evolved in the past 10 years, accompanied by various regulatory reforms. The following

factors have a significant effect on the various segments of the industry:

Economic growth: The International Monetary Fund has projected a positive growth rate for the Indian

economy during calendar years 2009 and 2010. India‟s growth rate is expected to be faster than that of both

the advanced and the developing economies as a whole. Increased ecomonic growth is expected to have

positive effect on the real estate sector. (Source: International Monetary Fund, World Economic Outlook

Update, January 2010)

Demographic profile: The percentage of the Indian population that is made up of the earning population (in

the 20-59 age bracket) is expected to increase. An increase in the earning population usually leads to

increased spending and consumption in the economy which may in turn lead to stronger demand for the

real estate industry.

Growth of mortgage finance and credit take-off: Growth in the real estate sector is directly affected by the

growth of mortgage finance and lending to the real estate sector in the country, both in terms of reach and

affordability. As a large proportion of the investment in real estate sector is funded by bank and financial

institutions, increased credit take-off acts as a stimulus to the sector.

3

Government policies: A number of Reserve Bank of India (“RBI”) initiatives have helped to increase the

real estate sector‟s access to capital. The Government of India in March 2005 amended existing legislation

to allow 100% Foreign Direct Investment (“FDI”) in the real estate sector, subject to certain restrictions. It

is expected that the increased FDI will provide the necessary funding to help meet demand in the

commercial and residential real estate sectors. The following table shows that FDI inflow in the housing

and real estate sector was second only to the services sector during the three most recent fiscal years:

Sector 2007-08

(Rs. in crore)

2008-09

(Rs. in crore)

2009-10

(Rs. in crore)

Services

(Financial and Non-Financial)

26,589 28,411 20,958

Computer Software and Hardware 5,623 7,329 4,350

Telecommunications 5,103 11,727 12,338

Housing and Real Estate 8,749 12,621 13,586

Construction Activities

(including roads & highways)

6,989 8,792 13,544

Power 3,875 4,382 6,908

Automobiles 2,697 5,212 5,609

Metallurgical Industries 4,686 4,157 1,935

Petroleum and Natural Gas 5,729 1,931 1,328

Chemicals

(other than fertilizers)

920 3427 1,707

(Source: Department of Industrial Policy and Promotion, Fact Sheet On Foreign Direc t Investment (FDI),

March 2010)

While the real estate sector in India has historically been unorganized, the sector has, in recent years,

exhibited a trend towards greater organization and transparency, accompanied by various regulatory

reforms. These reforms include:

the support of the Government of India in repealing of the Urban Land (Ceiling and Regulation)

Act (“ULCRA”), most state governments have repealed ULCRA except for West Bengal, Bihar

and Jharkhand;

modifications in the Rent Control Act to provide greater protection to homeowners wishing to rent

out their properties;

the rationalisation of property taxes in a numbers of states; and

the proposed computerisation of land records.

This trend has contributed towards the development of reliable indicators of value and organized

investment in the real estate sector by domestic and international financial institutions and has resulted in

the greater availability of financing for real estate developers and homeowners. The increased investment in

the real estate sector is being driven by: rising demand; heightened consumer expectations that are

influenced by higher disposable incomes; increased globalization and the introduction of new real estate

products and services.

4

SUMMARY OF BUSINESS

Overview

We own, develop, manage and operate urban city shopping centers, develop and sell large scale residential

townships, and own, develop and lease hospitality properties in fast growing and emerging cities in India (i.e.,

emerging non-metropolitan cities) under the brand name “TREASURE”. We have completed the development of

1.51 million square feet of Developable Area comprising three retail shopping centers and hospitality properties in

two cities, Indore in Madhya Pradesh and Nanded in Maharashtra, and we are in the process of developing 23.33

million square feet of Developable Area spread over 11 Ongoing Projects and three Forthcoming Projects in eight

emerging cities across seven states in India. Our Completed Projects include Treasure Island-Indore, which is one of

the largest shopping centers in Central India, as well as one of the first shopping centers in an emerging city

(Source: The Franchising World, November 2008), Treasure Central-Indore and Treasure Bazaar-Nanded. We have

launched three residential townships, including two Treasure Towns and Treasure Vihars in Indore and a Treasure

Town and Treasure Vihar in Udaipur. For the financial year 2010 we derived Rs.494.68 million of income from the

sale of residential properties and aggregate advance bookings for our three launched residential townships was Rs.

1,837.00 million as of March 31, 2010. As of March 31, 2010, the aggregate Developable Area of these three

launched residential townships was 11.03 million square feet.

We presently operate and have ownership interests in Treasure Island-Indore, Treasure Central-Indore and Treasure

Bazaar-Nanded. We completed Treasure Island-Indore in December 2005, which comprised 0.45 million square feet

of retail, hospitality, entertainment and food and beverage space and 0.18 million square feet dedicated to parking

space. It has won a number of awards, including the “Most Admired Shopping Center – Tier II Cities” by Images

Shopping Centre Awards (“ISCA”) in 2008, 2009 and 2010, “Best Retailer Award” by the India Franchise

Association in 2009 and “Best Designed Shopping Mall of India” by the CNBC – CRISIL Real Estate Awards in

2007. We completed Treasure Central–Indore in May 2009, which comprised 0.23 million square feet of retail

space, 0.05 million square feet of commercial space, 0.04 million square feet of entertainment space and 0.01

million square feet of food and beverage space and included certain anchor tenants such as Pantaloon. We

completed Treasure Bazaar-Nanded in January 2010, which comprised 0.25 million square feet of retail, hospitality,

entertainment, food and beverage space and commercial space and 0.11 million square feet of parking space.

To develop and operate our shopping centers, we analyze the consumption patterns of a particular city. The income

earning potential of a shopping center is not entirely dependent on traditional real estate development principles,

such as the floor space index (“FSI”) or construction costs. Rather, we believe that income earning potential is

dependent on having the right tenant mix and high operational standards, which in turn will lead to higher

consumption rates. With higher consumption rates, we are able to command higher lease rates from our tenants. As a

result, a driving factor in our business is to increase consumption in the shopping centers that we develop and

operate. We also focus on developing projects in fast growing and emerging cities, where we typically enjoy an

early-mover advantage with respect to retail projects, and where we believe there is significant growth potential.

Our shopping centers are divided into three formats, “Treasure Market City”, “Treasure Island” and “Treasure

Bazaar”. These formats are differentiated on the basis of size and type of retailers. Treasure Market City projects

include more than 1.00 million square feet of Developable Area and comprise a mix of premium and value retail

outlets, including department stores and other anchor tenants; a hypermarket and smaller shops; entertainment

facilities, such as a multiplex cinema, bowling alley, go-carting, rides and/or video arcade; food and beverage

outlets; and hospitality and commercial space. Treasure Island developments include primarily premium retail

outlets and other anchor stores, entertainment, food and beverage and hospitality space and have a Developable Area

of 400,000 square feet to 1.00 million square feet. Treasure Bazaar projects have a Developable Area of up to

400,000 square feet and comprise value retail outlets, entertainment, food and beverage and hospitality space.

We are also developing large scale residential townships with a total Developable Area of 15.22 million square feet

designed to cater to diverse budgets and different segments of society. We have divided our residential township

projects into two formats, “Treasure Town” and “Treasure Vihar”. Treasure Towns are premium residential

townships developed over land parcels of 20 to 200 acres with modern amenities including a gymnasium, club

house, swimming pool, spa, tennis courts, gardens, ponds and landscaped areas. These projects will include modern

infrastructure, including power back-up for common areas along with full-time security. Treasure Vihars are

5

affordable residential townships developed over land parcels of up to 50 acres with amenities such as power back-up

and full-time security. We believe that these projects will benefit from the TREASURE brand.

We are currently developing a Treasure Market City in Indore, Treasure Island projects in Raipur, Jabalpur, Bhilai

and Mohali and Treasure Bazaar projects in Ujjain, Amaravati and Baroda. Our retail and hospitality projects that

are part of our Ongoing Projects aggregate 5.11 million square feet of Leaseable Area, and our residential township

projects that are part of our Ongoing Projects aggregate 11.03 million square feet of Developable Area.

As of March 31, 2010, our “Forthcoming Projects” (i.e., projects in which the necessary legal documents relating to

acquisition of land or development rights have been executed, key land related approvals are being obtained and

management has prepared an initial design plan of the project or an architect has been appointed and a detailed

architect plan is in the process of being prepared), include a Treasure Island project in Thiruvananthapuram and

Treasure Town and Treasure Vihar projects in Indore (at Kanadia) and in Raipur (at Samta Colony), which are

expected to have 5.06 million square feet of Developable Area. Our retail and hospitality projects that are part of our

Forthcoming Projects aggregate 0.87 million square feet of Developable Area and our residential township projects

that are part of our Forthcoming Projects aggregate 4.19 million square feet of Developable Area.

“Developable Area” refers to the total construction area which we develop in each property, and includes carpet

area, wall area, common area, service and storage area, as well as other areas, including car parking. Such area,

other than car parking space, is often referred to in India as “super built-up” area. “Leaseable Area” is calculated by

the loading percentage (the percentage of a tenant‟s rent applied towards a shopping center‟s common areas) of

10.00% to 60.00% of the carpet area of the property, depending upon the use, and refers to the part of the

Developable Area that can be leased out to third parties.

The table below summarizes our Completed Projects, Ongoing Projects and Forthcoming Projects by type of project

and their total Developable and Leaseable Areas as of March 31, 2010:

Treasure

Market

City

Treasure

Island

Treasure

Bazaar

Treasure Town

and Vihar

Total

Completed Projects

No of Projects - 1 2 - 3

Total Developable Area

(million square feet) -

0.65

0.86 - 1.51

Total Leasable/Saleable Area


0.45

0.58 - 1.03

Ongoing Projects

No of Projects 1 4 3 3 11


(million square feet)

3.00

3.21

1.03 11.03 18.27



2.02

2.32

0.77 11.03 16.14

Forthcoming Projects

No of Projects - 1 - 2 3



0.87

- 4.19 5.06



0.75

- 4.19 4.94

Grand Total




3.00

4.73

1.89 15.22 24.84



2.02

3.52

1.35 15.22 22.11

6

We utilize project-specific SPVs and project-specific equity financing from investors for each of our projects. Some

of our key investors include PML, IAF - III and IAF - IV, funds managed by ICICI Venture Funds Management

Company Limited, MPC Synergy Limited, Edelweiss Trustee Services Limited, Kshitij Venture Fund and

Landmark Hi Tech Development Private Limited. As of March 31, 2010, our holdings across all our project-specific

SPVs range from 51.00% to 100.00% (except the project-specific SPVs of Treasure Central-Indore, Treasure Island-

Bhilai and Treasure Town and Treasure Vihar-Raipur), which enables us to consolidate and recognize income from

these project-specific SPVs in our balance sheet, as well as retain management control.

For the financial year 2010, our total income was Rs.1,062.34 million, our total net profit before tax and

depreciation was Rs.224.49 million and our net profit after tax before minority interest and share from associates

was Rs.148.15 million.

Strengths

We believe that the following are our principal strengths:

Ownership and operation of shopping centers resulting in predictable and stable revenues

In contrast to traditional real estate development companies which generally develop and sell properties, we own

most and operate all of our shopping center properties, including Treasure Island-Indore, Treasure Central-Indore

and Treasure Bazaar-Nanded. We currently own and operate a total Leaseable Area of 1.03 million square feet at

these three shopping centers through project-specific SPVs. This assures us of stable revenues for the terms of the

various leases which are generally for terms of 36 to 60 months. We have received rental income from the lease of

properties of Rs.230.35 million for the financial year 2010 (includes our share of rental income generated from our

joint venture project, Treasure Central-Indore). Upon completion of our retail and hospitality projects that are part of

our Ongoing Projects and Forthcoming Projects and along with our Completed Projects, we will operate and have

ownership interests in one Treasure Market City project, six Treasure Island projects and five Treasure Bazaar

projects, which will continue to provide us with steady revenues.

Consumption driven revenue model combined with stable rentals

We believe that the business of developing and operating successful shopping centers is attributable to the

consumption pattern of target customers, which comprises spending patterns and behavior within a catchment area

and is less related to real estate development. We also believe that the income earning potential of a shopping center

is not directly linked to the prevailing real estate prices in the vicinity, but is more linked to a shopping center‟s

tenant mix and quality of management. We intend to maximize the potential of a particular catchment area by

having the right tenant mix, which we believe leads to higher consumption rates.

For our shopping center developments, we have adopted a lease model, whereby we operate and maintain ownership

interests in the shopping centers we develop. We have leased and plan to lease out space across various properties

under lease structures where we receive basic minimum rentals and a percentage of revenue generated by the tenant.

While this assures us of minimum rentals across our retail properties, it also enables us to receive a share of the

revenues generated by our tenants‟ in-store sales, which aligns our interests with those of our tenants. Given our

business model and structuring of lease agreements, our lease rentals increase as consumption increases in a

particular location. This differentiates us from other typical real estate development companies and links our

business model to the consumption pattern of target micro-markets.

We have received rental income from the lease of properties of Rs.230.35 million for the financial year 2010

(includes our share of rental income generated from our joint venture project, Treasure Central-Indore), and

Rs.158.94 million and Rs.149.05 million for the financial years 2009 and 2008, respectively. We expect that we will

own most and operate all of our retail and hospitality projects that are part of our Ongoing Projects and Forthcoming

Projects including one Treasure Market City project, five Treasure Island projects and three Treasure Bazaar

projects, which will continue to provide us with stable rentals. With the completion of these projects, we are

expected to become one of the largest shopping center owners and operators in India in terms of number of

7

operational shopping centers. (Source: “Retail off the Beaten Track,” January 10, 2010, Jones Lang LaSalle

Meghraj)

Strategic relationships with large retailers

We believe that our shopping centers are the preferred choice among retailers in the cities in which we operate and

provide a platform for large retailers to expand their businesses in such cities with a common partner. To

successfully lease out a shopping center, we believe that the retailer‟s confidence in the developer is a very

important factor, especially in fast growing and emerging cities where there are few organized national developers.

We believe that retailers have confidence in us due to our track record in achieving financial closure for our projects,

our commitment to quality and our operational expertise. In addition, as an early mover in the shopping center

industry in India, as evidenced by Treasure Island-Indore being among one of the first 10 shopping centers in

existence in India, as well as the first shopping center in an emerging city in India, our association with retailers

began in the early days of organized retail in India. (Source: The Franchising World, November 2008) We are a

member of the International Council of Shop Centers and we have grown with the retail industry and have been

actively involved in forums, events and conferences on organized retail in India and outside India, which we believe

has fostered confidence in us among retailers. We have strong relationships with large retail brands, including the

Pantaloon Group, which occupies 0.10 million square feet at Treasure Island-Indore, 0.21 million square feet at

Treasure Central-Indore and 0.03 million square feet at Treasure Bazaar-Nanded, and has committed to occupy 0.36

million square feet in our Ongoing Projects. Other large retail brands, such as Big Bazaar, E-Zone, Gitanjali,

Spencer and Max have also committed to anchor spaces in our projects under development. We believe that such

relationships help us in securing tenants for our new developments.

Early mover advantage and track record in fast growing and emerging cities

All of our retail properties and projects are strategically located in city centers and high growth corridors of the cities

in which they are developed. As one of the first developers of a shopping center in an emerging city, we have been

recognized by the market as an early mover in the shopping center industry in fast growing and emerging cities of

India. (Source: The Franchising World, November 2008) We believe that many of our projects enjoy the status of

being either the first shopping center of the city in which it is located or the largest shopping center in the city

center. We believe that this has helped us to become one of the preferred shopping center partners for major retailers

in India.

In addition, we have a successful track record in the execution of projects, including opening the projects on the

projected timelines. We presently have three operational shopping centers, with four additional projects expected to

open by the end of the financial year 2011. With the completion of our Ongoing Projects, we are expected to

become one of the largest shopping center owners focused on fast growing and emerging cities in the country by the

end of financial year 2012. (Source: “Retail off the Beaten Track,” January 10, 2010, Jones Lang LaSalle Meghraj)

Quality project execution and professional management capabilities

Our position as a successful real estate developer is largely due to our execution capabilities, which we have

demonstrated with the successful and timely completion and the quality of operation and management of Treasure

Island-Indore, Treasure Central-Indore and Treasure Bazaar-Nanded, as well as the launches of the Treasure Town

and Treasure Vihar projects in Indore (at AB Road and Rangawasa) and Udaipur (at Kharol Colony). We believe

that we are one of the few developers in India that has the range of skills required to develop and operate a shopping

center, including construction, interiors, fit-outs, mechanical, engineering and plumbing (“MEP”) services, design

and project management. We have accomplished this by primarily developing organically and acquiring separate

businesses that fulfill these functions.

Through Treasure World Developers Private Limited (“TWDPL”), our construction company, civil contracts across

most of our projects are undertaken through a documented tendering system by the project-specific SPV. In

addition, we subscribed to 51.00% interest in Intesys Technologies Private Limited (“Intesys”), a Delhi based

interior and fit-out specialist company, to ensure that the fit-outs of our projects are carried out in a timely manner,

as well as at a competitive cost, as each project-specific SPV follows a transparent tendering system for awarding

fit-out contracts. Intesys is a fit-out specialist in India that has the ability to undertake the entire chain of work

8

required for fitting out a shopping center, including all elevational features, inside flooring, railings, false ceilings

and glazing. We also have our own MEP design company, Treasure MEP Services Private Limited (“TMEP”),

which is responsible for designing the MEP drawings and choosing the vendors and contractors for the MEP

services for all of our projects. Finally, we act as the project manager for all of our projects, which allows us to

closely monitor quality and costs.

Experienced and dedicated management

We have an experienced, qualified and dedicated management team, many of whom individually have over 15 years

of experience in their respective fields. We were one of the first real estate developers to build a modern shopping

center in central India, Treasure Island-Indore, which we completed on schedule and within budget. We believe our

operational properties illustrate our management‟s capability to deliver high quality projects in a highly competitive

business, secure financing and execute complex projects on time. For example, Treasure Island-Indore was

completed six months ahead of its scheduled completion date while meeting all specifications and requirements,

which we believe signifies the strength of our management in executing complex projects in new markets. All of

these properties have required attracting a number of anchor tenants and obtaining significant financing from a

number of institutional lenders. In addition, our brand name and reputation for project execution, have assisted us in

recruiting and retaining qualified management and employees. We also provide our staff with competitive

compensation packages and a corporate environment that encourages responsibility, autonomy and innovation. We

believe that the experience of our management team and its in-depth understanding of the real estate market in India

will enable us to take advantage of both current and future market opportunities.

Strategies

Our business strategy consists of the following principal elements:

Focus on “TREASURE” branded development projects in city-centric locations across India

We are committed to developing a large portfolio of retail projects and residential township projects under the

“TREASURE” brand wherein a consumer can relate to similar experiences across all our properties in India. We

have developed three formats for shopping centers and two formats for residential townships. The three formats are

differentiated on the basis of size of the shopping centers, the type of retailers and other facilities, including hotels,

multiplex cinemas and other entertainment venues and commercial space available at the development. We are also

developing residential townships, which are divided into two formats, “Treasure Town” and “Treasure Vihar”. As

of March 31, 2010, our retail and hospitality projects that are part of our Ongoing Projects include a Treasure

Market City in Indore, Treasure Island projects in Raipur, Jabalpur, Bhilai and Mohali and Treasure Bazaar projects

in Ujjain, Amaravati and Baroda. We are also developing Treasure Town and Treasure Vihar projects in Indore and

Udaipur. Our Forthcoming Projects include a retail and hospitality project in Thiruvananthapuram and residential

township projects in Indore (at Kanadia) and Raipur (at Samta Colony). Since most of our retail and hospitality

projects are developed in city center locations in fast growing and emerging cities, we envision our retail

developments as being the city center itself and becoming landmark destinations of the city. We aim to make

“TREASURE” a brand synonymous with quality and best management practices at viable rents across fast growing

and emerging cities in India.

Continue to develop projects in fast growing and emerging cities where we believe we are one of the dominant

organized retail, hospitality and residential developer

We will continue to focus on our strategy of developing shopping centers and residential townships in fast growing

and emerging cities in India where we typically enjoy an early-mover advantage, where we enjoy being the

dominant organized retail developer and where we believe there is significant growth potential. We believe that a

number of underlying factors will continue to provide India‟s retail sector with good growth prospects including,

favorable demographics, with two thirds of India‟s population below the age of thirty-five, continuing urbanization,

especially in emerging cities in which our projects are concentrated, India‟s economy continuing to grow steadily

and a growing middle class. We aim to be the largest shopping center owner and operator in fast growing and

emerging cities in India. We believe that our “TREASURE” brand is gaining in reputation and is recognized by

9

retailers as the first choice in these cities. (Source: “Retail off the Beaten Track,” January 10, 2010, Jones Lang

LaSalle Meghraj)

Focus on performance and project execution

We believe that we have developed a reputation for good quality construction projects and completing projects

ahead of schedule. For example, Treasure Island-Indore was completed in 21 months, six months ahead of schedule,

as a result of our efficient management practices and close collaboration with third party contractors on the project.

As of March 31, 2010, we have 11 Ongoing Projects aggregating 18.27 million square feet of Developable Area. We

intend to continue to focus on performance and project execution in order to maximize client satisfaction. We will

continue to leverage the capabilities of our subsidiary service companies, including TWDPL, a construction

company, Intesys, a fit-out company, TMEP, a MEP design company, as well as our in-house project management

services, to ensure that all of our projects are completed on time and within the budgeted cost.

Focus on shopping center management

We have developed our shopping center management expertise by successfully managing our three operational retail

properties, which we believe are managed in accordance with international standards. With respect to all of our

shopping center projects, we expect we will enter into management contracts with each of the project-specific SPVs.

We will continue to manage our retail developments with the knowledge that there is a distinct difference between

property management and shopping center management. While most shopping center developers operate under the

premise that shopping center management comprises housekeeping, security and maintenance, we believe that these

elements contribute a small fraction of the total activities required to successfully manage a shopping center.

Accordingly, we will continue to focus on creating the optimal tenant mix and adhering to high operational

standards at each of our developments, which we believe will lead to higher consumption rates. With higher

consumption rates (which translates to higher turnover for our tenants), we expect to command competitive lease

rates from our tenants and higher revenues from our revenue sharing contracts.

Develop the “Treasure Showcase” concept

In order to tap into the customer base of the large number of Indian brand manufacturers operating in unorganized

multi-brand outlets across India, we have recently launched the concept “Treasure Showcase” at Treasure Island-

Indore. Treasure Showcase is a “shop-in-shop” seamless concept which will provide Indian non-mall brands a

platform to showcase and sell their products in our shopping centers in categories such as apparel, footwear,

electronics, food, accessories, cosmetics, jewellery, home furnishings and appliances based on a revenue sharing

arrangement. Our aim is not only to expand the number of retailers in the organized sector, but also to convert non-

shopping center customers who shop at multi-brand outlets into shopping center customers. Under the terms of our

Treasure Showcase revenue sharing arrangements, we provide our retail partners space of approximately 15,000

square feet to 50,000 square feet and operating services such as billing and shopping administration. We typically

purchase the products from our Treasure Showcase partners and pay for the products once a customer has purchased

the partner‟s product. Products which we have purchased but were not sold are returned to the partner at no cost to

us. In return for providing our Treasure Showcase partners with retail floor space, we receive approximately 35.00%

to 40.00% of the revenues from sales of our retail partner‟s products, as negotiated on a case-by-case basis. We

expect that this model will enable us to cover our operational costs, increase footfall and provide customers with

differentiated choices in our shopping centers. We intend to launch 19 additional Treasure Showcases by the end of

the financial year 2013, 12 of which will be located in our own shopping centers and seven of which will be located

in the shopping centers of other developers, mainly projects developed by PML.

Continue to utilize effective development and ownership structures to optimize resources

We will continue to utilize project-specific SPVs and project-specific equity financing from investors, which will

assist us in reducing our working capital investment and diversifying our risk. Although we intend to own and lease

our projects under development, this model provides us with the flexibility to strategically exit any particular

property or project by selling our interest in such property or project where we believe an absolute sale or perpetual

leases will provide us with more favorable returns.

10

SUMMARY FINANCIAL INFORMATION

The following tables set forth summary financial information derived from our restated unconsolidated and

consolidated financial statements as of and for the years ended March 31, 2006, 2007, 2008 , 2009 and 2010.

These financial statements have been prepared in accordance with the Indian GAAP, the Companies Act and the

SEBI Regulations and presented under “Financial Statements” on page 162 of this Draft Red Herring Prospectus.

The summary financial information presented below should be read in conjunction with our restated

unconsolidated and consolidated financial statements, the notes thereto and the section “Management’s

Discussion and Analysis of Financial Condition and Results of Operations” and “Financial Statements” on pages

266 and 162 of this Draft Red Herring Prospectus, respectively.

Summary Consolidated Statement of Assets and Liabilities, as restated

Rs. In Million

PARTICULARS AS AT MARCH 31

2010 2009 2008 2007 2006

A FIXED ASSETS

Gross Block 3,733.19 2,474.38 2,004.17 1,444.38 660.43

Less: Depreciation/ Amortization 155.27 102.92 62.81 30.94 6.30

Net Block 3,577.92 2,371.46 1,941.36 1,413.44 654.12

Capital Work- In- Progress 5,017.18 4,447.12 1,842.22 570.16 53.71

Total (A) 8,595.10 6,818.58 3,783.58 1,983.60 707.83

B INVESTMENTS (B) 123.01 119.51 83.27 105.10 -

C CURRENT ASSETS, LOANS AND

ADVANCES

Inventories 3,078.60 2,467.66 1,435.39 291.32 -

Sundry Debtors 385.65 33.26 38.96 13.53 14.00

Cash and Bank Balances 795.61 1,246.85 281.29 117.66 24.86

Loans and Advances 1,221.46 1,048.99 1,301.19 495.73 468.18

Total (C) 5,481.32 4,796.76 3,056.83 918.24 507.04

D LIABILITIES AND PROVISIONS

Current Liabilities 1,276.58 1,452.99 452.65 137.53 105.96

Provisions 28.85 14.60 4.52 3.16 0.70

Deferred Tax Liability 4.50 1.77 - - -

Secured Loans 5,065.61 3,147.27 1,836.97 1,066.28 706.22

Unsecured Loans 4,059.91 4,029.95 2,293.53 560.00 4.77

Deposits from Licencees ( Refer Note

B.18 of Annexure IV)

224.38 210.27 136.20 111.96 66.63

Total (D) 10,659.83 8,856.85 4,723.87 1,878.93 884.28

E Net Worth (A+B+C-

D)

3,539.60 2,878.00 2,199.81 1,128.01 330.59

F Represented by:

1) Share Capital 158.46 158.46 158.46 140.39 102.83

2) Share Application Money - 97.50 879.99 62.73 128.83

3) Reserves and Surplus

11


2010 2009 2008 2007 2006

(a) Securities Premium Account 1,364.43 1,265.03 902.50 767.45 111.88

(b) General Reserve 6.00 6.00 - - -

(c) Profit and Loss Account - - - 6.05 -

Total [(1)+(2)+(3)] 1,528.89 1,526.99 1,940.95 976.62 343.54

Less: Debit balance in Profit and

Loss Account

(16.98) (142.72) (13.86) - (12.95)

Minority Interest 2,027.69 1,493.73 272.72 151.39 -

G Net Worth 3,539.60 2,878.00 2,199.81 1,128.01 330.59

The accompanying Summary of Significant Accounting Policies and Notes to Consolidated Summary Statements

are an integral part of this Statement.

Summary Consolidated Statement of Profits and Losses, as restated

Rs. In Million

PARTICULARS FOR THE YEARS ENDED MARCH 31,

2010 2009 2008 2007 2006

INCOME

Income From Operations 1,020.01 389.09 265.32 218.36 26.05

Other Income 42.33 34.59 16.75 13.23 0.10

Total Income 1,062.34 423.68 282.07 231.59 26.15

EXPENDITURE

Construction Expenses 268.93 29.65 - - -

Operating and Other Expenses 276.32 193.65 142.68 113.26 5.91

Employee Remuneration and Benefits 93.41 58.47 41.34 18.48 2.10

Interest 199.19 207.41 86.74 78.98 -

Depreciation/ Amortization 46.23 52.72 41.51 36.08 8.60

Total Expenditure 884.08 541.90 312.27 246.80 16.61

PROFIT/ (LOSS) BEFORE TAX 178.26 (118.22) (30.20) (15.21) 9.54

LESS: PROVISION FOR TAX

Current Tax 27.18 29.83 2.49 1.55 0.80

Deffered Tax 2.85 1.77 - - -

Wealth Tax 0.08 0.04 0.05 0.03 -

Fringe Benefits Tax - 1.64 1.73 1.00 0.35

Net Profit / (Loss) Before Minority Interest and Share from

Associates

148.15 (151.50) (34.47) (17.79) 8.39

Share of loss from Associates 0.16 (0.05) (0.10) - -

Minority Interest 22.25 12.99 (2.07) (0.01) -

Net Profit / (Loss) After Minority Interest and Share from

Associates

125.74 (164.54) (32.50) (17.78) 8.39

Adjustments made on account of restatement

( Refer Note B.2 of Annexure IV)

- 35.68 12.59 36.78 (21.34)


Associates, as Restated

125.74 (128.86) (19.91) 19.00 (12.95)

Balance brought forward from previous year (142.72) (13.86) 6.05 (12.95) -

BALANCE CARRIED FORWARD, AS RESTATED (16.98) (142.72) (13.86) 6.05 (12.95)

12

Summary Consolidated Statement of Cash Flows, as restated

Rs. In Million

Particulars FOR THE YEARS ENDED MARCH 31,

2010 2009 2008 2007 2006

Cash Flow From Operating Activities

Profit Before Tax 178.26 (82.54) (17.61) 21.57 (11.80)

Adjustments for:

Depreciation 46.23 38.40 28.92 23.73 5.51

Preliminary Expenses Written off - 0.19 - - 0.82

General reserve on account of land - 6.00 - - -

Loss on sale of Fixed Assets (Net) 0.77 0.45 0.40 0.11 -

Interest Income (10.68) (23.93) (6.11) (4.27) (0.10)

Dividend on Current Investments (0.06) (0.52) (2.92) (3.85) -

Profit on sale of Current Investments - - (0.54) (0.35) -

Profit on sale of Subsidiaries (20.29) - - - -

Sundry Balances Written Back (3.13) (0.53) (0.29) (0.05) -

Provision for Doubtful Debt 0.52 0.52 - - -

Balances Written off 1.29 0.26 0.82 0.03 -

Capital Work in Progress Written off - 1.74 1.91

Interest Expense 199.19 207.41 86.69 78.98 -

Operating profit before working capital changes 392.10 147.45 91.27 115.90 (5.57)

(Increase) / Decrease in receivables (354.21) 4.93 (26.64) 0.85 (14.00)

(Increase) / Decrease in loans and advances (139.36) 359.96 (679.69) (10.98) (446.97)

(Increase) / Decrease in inventories (610.94) (732.23) (1,159.96) (277.98) -

(Decrease) / Increase in provision (0.62) 2.41 (0.42) 2.23 -

(Decrease) / Increase in payables (164.86) 868.01 315.11 31.58 99.51

Cash (used in)/ generated from operations (877.89) 650.53 (1,460.34) (138.40) (367.02)

Less: Taxes (paid)/refund (41.61) (46.29) (34.17) (27.64) (0.35)

Net Cash Flow (used in)/ generated from

Operating Activities

(919.50) 604.24 (1,494.51) (166.04) (367.38)

Cash Flows from Investing Activities

Share application money pending allotment - 69.58 (94.58) 11.44 -

Sale of fixed assets 23.85 0.79 1.35 11.39 -

Purchase of fixed assets (1,858.70) (3,071.10) (1,814.56) (1,212.49) (292.58)

Investment in Associate Companies (3.33) - - (41.67) -

Sale of Investment in Subsidiaries and Associate

Companies

22.09 - - - -

Purchase Consideration paid on acquisition of

interest in subsidiary

(7.95) (0.00) (112.70) -

Purchase of Current Investments (0.16) (1,435.90) (1,712.94) (2,989.04) -

Sale of Current Investments - 1,470.97 1,740.41 2,927.27 -

Purchase of Long term Investment - (72.91) (5.20) - -

Dividend Received 0.06 0.52 2.92 3.85 -

Interest Received 6.07 9.57 4.86 2.19 0.10

Proceeds from issue of shares to minority

shareholders by subsidiaries

- -

Net Cash (used in)/Flow From Investing

Activities

(1,810.12) (3,036.42) (1,877.74) (1,399.76) (292.48)

13


2010 2009 2008 2007 2006

Cash Flows From Financing Activities

Proceeds from issue of share capital - 12.27 25.66 125.99

Proceeds from Securities Premium 99.93 - 93.93 251.60 -

Share application money (97.50) (782.50) 880.00 62.72 -

Debenture Issue Expenses (0.53) (1.00) (23.64) (6.43) -

Proceeds from Long Term Borrowings - - - 490.07

Proceeds from issue of debentures 1,000.00 1,699.99 550.00 -

Proceeds from / (Repayment of) Secured Loans 1,918.33 1,310.30 770.69 360.06 -

Proceeds from / (Repayment of) Unsecured Loans 29.97 - 33.54 10.00 4.77

Proceeds from / (Repayment of) Loans from Group

Companies

13.24 178.59 - (4.77) -

Proceeds from/ (Repayment to) loan from/ to others 236.74 - - -



511.55 1,569.06 131.21 443.46 -

Deposits from Licensees 14.12 74.08 24.25 45.28 61.32

Interest Paid (210.73) (187.52) (86.38) (78.98) -

Net Cash flow from/(used in) Financing

Activities

2,278.38 3,397.74 3,535.87 1,658.60 682.15

Net (Decrease)/ increase in cash and cash

equivalents

(451.24) 965.56 163.62 92.80 22.29

Cash and cash equivalents as at beginning of

years

1,246.85 281.29 117.66 24.86 2.57

Cash and cash equivalents as at end of years 795.61 1,246.86 281.29 117.66 24.86

Cash Equivalents Comprise of

Cash on Hand 3.91 31.06 2.29 1.62 1.05

Balance with Scheduled Banks

In Current Accounts 141.74 178.71 112.64 35.94 1.63

In Fixed Deposit Accounts* 649.96 1,034.78 166.36 80.10 22.18

In Overdraft Account - 2.30 - - -

Total 795.61 1,246.85 281.29 117.66 24.86

* Fixed Deposit Accounts are deposited with banks as security for the guarantees provided by the banks.

Summary Unconsolidated Statement of Assets and Liabilities, as restated

Rs. In Million


2010 2009 2008 2007 2006

A FIXED ASSETS

Gross Block 990.40 988.42 968.04 697.38 660.42

Less: Depreciation 121.84 91.89 58.44 29.97 6.30

Net Block 868.56 896.53 909.60 667.41 654.12

Capital Work- In- Progress - - 2.36 197.89 53.71

Total (A) 868.56 896.53 911.96 865.30 707.83

B INVESTMENTS (B) 1,301.13 1,088.93 1,113.09 554.71 -

14


2010 2009 2008 2007 2006


ADVANCES

Sundry Debtors 48.51 25.03 124.55 108.72 14.00

Cash and Bank Balances 46.03 75.43 63.20 81.82 24.86

Loans and Advances 939.32 1,065.90 1,448.18 955.30 468.18

Total (C) 1,033.86 1,166.36 1,635.93 1,145.84 507.04


Current Liabilities 42.21 78.69 61.13 135.53 105.96

Provisions 0.35 1.37 2.78 2.99 0.70

Secured Loans 760.56 804.71 990.93 1,053.13 706.22

Unsecured Loans 1,391.49 1,174.43 750.00 550.00 4.77



124.16 125.08 124.31 108.47 66.63

Total (D) 2,318.77 2,184.28 1,929.15 1,850.12 884.28

E Net Worth (A+B+C-

D)

884.78 967.54 1,731.83 715.73 330.59

F Represented by:

1) Share Capital 158.46 158.46 158.46 140.39 102.83


3) Reserves and Surplus:

(a) Securities Premium Account 624.82 624.82 624.82 473.97 111.88

(b) Profit and Loss Account 101.50 86.76 68.55 38.64 -

Total [(1)+(2)+(3)] 884.78 967.54 1,731.83 715.73 343.54

Less: Debit balance in Profit and Loss

Account - - - - (12.95)

G Net Worth 884.78 967.54 1,731.83 715.73 330.59

The accompanying Summary of Significant Accounting Policies and Notes to Unconsolidated Summary Statements are

an integral part of this Statement.

Summary Unconsolidated Statement of Profits and Losses, as restated

Rs. In Million


2010 2009 2008 2007 2006

INCOME

Income From Operation 266.68 248.35 352.28 309.17 26.05

Other Income 12.75 67.04 13.75 19.03 0.10

Total Income 279.43 315.39 366.03 328.20 26.15

EXPENDITURE



Interest 110.50 114.30 95.31 80.43 -

Depreciation 30.66 48.30 41.42 36.06 8.60

15


2010 2009 2008 2007 2006


PROFIT BEFORE TAX 17.85 4.74 21.24 17.39 9.54


-Current Tax 3.04 0.49 2.15 1.54 0.80

-Wealth Tax 0.07 0.06 0.05 0.03 -

-Fringe Benefits Tax - 0.30 1.72 1.01 0.35

NET PROFIT AFTER TAX AS PER AUDITED

FINANCIAL STATEMENTS

14.74 3.89 17.32 14.81 8.39

Adjustments made on account of restatement ( Refer Note B.1

of Annexure IV)

- 14.32 12.59 36.78 (21.34)

NET PROFIT / (LOSS) AFTER TAX, AS RESTATED 14.74 18.21 29.91 51.59 (12.95)

Balance brought forward from previous year, as restated 86.76 68.55 38.64 (12.95) -

BALANCE CARRIED FORWARD, AS RESTATED 101.50 86.76 68.55 38.64 (12.95)

The accompanying Summary of Significant Accounting Policies and Notes to Unconsolidated Summary Statements


Summary Unconsolidated Statement of Cash Flows, as restated

Rs. In Million


2010 2009 2008 2007 2006


Profit / (Loss) Before Tax, as restated 17.85 19.06 33.83 54.17 (11.80)

Adjustments for:

Depreciation 30.66 33.98 28.83 23.70 5.51

Preliminary Expenses Written off - - - - 0.82

Loss on sale of Fixed Assets 0.77 0.45 0.40 0.07 -

Interest Income (4.41) (64.54) (6.02) (10.40) (0.10)

Dividend Income - (0.06) (0.48) (3.80) -





Forfeiture of Security Deposit (0.12) (0.07) (0.99) (4.01) -



(Increase)/ Decrease in receivables (24.00) 99.01 (16.65) (94.72) (14.00)

Decrease/(Increase) in loans and advances 5.50 32.97 (446.72) (461.85) (446.97)

(Decrease) /Increase in payables (34.10) 16.92 (74.03) 35.78 99.51

Cash generated from/(used in) Operations 101.37 252.27 (386.05) (380.70) (367.03)

Less: Taxes paid 19.93 0.17 (36.10) (27.77) (0.35)

Net Cash generated from/(used in) Operating

Activities

121.30 252.44 (422.15) (408.47) (367.38)



Purchase of fixed assets (5.15) (19.73) (76.95) (181.76) (292.58)

16


2010 2009 2008 2007 2006

Investment in Subsidiaries and Associate Companies - (29.63) (1,166.04) (554.71) -


Companies

1.30 43.72 617.73 - -

Purchase of Current Investments - - (437.99) - -

Sale of Current Investments - 10.06 427.98 0.07 -

Share Application Money paid (Pending Allotment) (20.00) (1.10) - - -

Share Application Money Received Back 1.20

Dividend Received - 0.06 0.49 3.81 -

Interest Income 0.05 66.89 2.03 10.40 0.10

Refund of Loan from Other Companies 55.35 2,410.43 - - -

Loans to Other Companies (14.08) (2,348.87) (9.60) - -

Loans to Subsidiary Companies (680.46) 285.04 - - -

Refund of Loan from Subsidiary Companies 545.43 - - - -

Net Cash (used in) / Flow from Investing

Activities

(114.66) 417.60 (641.29) (721.65) (292.48)


Proceeds from issue of share capital - - 12.27 25.66 125.99

Proceeds from Securities Premium - - 93.93 251.60 -

Share application money - 250.00 880.00 62.72 -

Repayment of Share application money (97.50) (1,032.50) - - -

Proceeds from Long Term Borrowings - - - 346.91 490.07

Proceeds from issue of debentures - - 200.00 550.00 -

Debenture Issue Expenses - - - (6.43) -

Proceeds from Secured Loans - 101.74 215.57 - -

Repayment of Secured Loans (44.15) (287.97) (277.77) - -

Proceeds from Unsecured Loans 2,002.35 768.81 339.72 - -

Repayment of Unsecured Loans (1,785.29) (344.38) (339.72) (4.77) 4.77

Deposits from Licensees (0.95) 0.79 15.83 41.82 61.32

Interest Paid (110.50) (114.30) (95.01) (80.43) -

Net Cash (used in)/flow from Financing Activities (36.04) (657.81) 1,044.82 1,187.08 682.15

Net increase in cash and cash equivalents (29.40) 12.23 (18.62) 56.96 22.29


years

75.43 63.20 81.82 24.86 2.57

Cash and cash equivalents as at end of years 46.03 75.43 63.20 81.82 24.86


Cash on Hand 0.23 0.34 0.45 0.18 1.05



In Fixed Deposit Accounts* 34.91 41.37 25.36 79.10 22.19

Total 46.03 75.43 63.20 81.82 24.86


17

THE ISSUE

Number of Equity Shares

Issue of Equity Shares 38,928,943

Of which:

A) QIB Portion At least 19,464,472(2)

of which

Anchor Investor Portion(1)

Up to 5,839,342

Balance available for allocation to QIBs other than the

Anchor Investor Portion (assuming the Anchor Investor

Portion is fully subscribed)

13,625,130

of which

Available for allocation to Mutual Funds only

(5% of the QIB Portion (excluding the Anchor

Investor Portion))

681,257

Balance for all QIBs including Mutual Funds 12,943,873

B) Non-Institutional Portion(2)

Not less than 5,839,341

C) Retail Portion(2)

Not less than 13,625,130

Pre and post-Issue Equity Shares

Equity Shares outstanding prior to the Issue 62,957,184(3)

Equity Shares outstanding after the Issue 129,763,143

Use of Net Proceeds See “Objects of the Issue” on page 38 of this Draft Red

Herring Prospectus.

Allocation to all categories, except the Anchor Investor Portion, if any, shall be made on a proportionate basis. (1) The Company may allocate up to 30% of the QIB Portion to Anchor Investors on a discretionary basis. One-third of the Anchor Investor

Portion shall be reserved for domestic mutual funds, subject to valid Bids being received from domestic mutual funds at or above the price at which allocation is being done to Anchor Investors. For further details, see “Issue Procedure” on page 332 of this Draft Red Herring

Prospectus.

(2) If at least 50% of the Issue cannot be Allotted to QIBs, then the entire application money shall be refunded forthwith. Under - subscription, if

any, in the categories, except the QIB Portion would be allowed to be met with spill over from any other category at the sole discretion of the

Company, in consultation with the BRLMs and the Designated Stock Exchange.

(3) Pursuant to a securities subscription and shareholders’ agreement dated November 1, 2006 between the Company, IAF - III, Promoters and

Ashok Ruia Enterprises Private Limited (merged with PML) (“Agreement”), the Company has issued and allotted 7,500,000 optionally convertible debentures of Rs. 100 each (“OCDs”) to IAF - III which will convert into 27,877,016 Equity Shares at a conversion price to be

determined in accordance with the terms of the Agreement, prior to the filing of the Red Herring Prospectus with the RoC. Of, 27,877,016,

Equity Shares that will be allotted to IAF - III, 11,463,276 Equity Shares aggregating to 8.83% of the post-Issue paid-up capital of the Company will be held in an escrow account with an escrow agent in accordance with the terms of the Agreement(“Escrow Equity Shares”).

The Escrow Equity Shares shall be released from the escrow account proportionately to the Promoters and IAF - III depending on the value

realised on sale of balance Equity Shares by IAF - III and the return on investment computed as per a prescribed multiple of cost or IRR structure, whichever is higher, as specified under the Agreement, after the mandatory lock-in period of one year from the date of allotment of

Equity Shares in the Issue. The Promoters and IAF - III will enter into an escrow Agreement with an escrow agent prior to the conversion of

OCDs into Equity Shares and filing of the Red Herring Prospectus with the RoC. The details of the conversion price and the escrow

agreement will be updated in the Red Herring Prospectus prior to filing with the RoC. For further details in relation to the Agreement, see

“History and Certain Corporate Matters – Shareholder Agreements/ Other Key Agreements” on page 110 of this Draft Red Herring

Prospectus.

18

GENERAL INFORMATION

Registered Office and registration number of the Company

G-16, R. R. Hosiery Building,

Shree Laxmi Woolen Mills,

Opp. Shakti Mills Compound,

Off. Dr. E. Moses Road,

Mahalaxmi

Mumbai 400 011

Maharashtra

Tel: (91 22) 4045 0555

Fax: (91 22) 4045 0512

Website: www.ewdpl.com

CIN: U45202MH1999PLC164003

Address of Registrar of Companies

The Company is registered with the Registrar of Companies, Mumbai, Maharashtra, situated at the following

address:

Registrar of Companies

Everest, 5th

Floor

100 Marine Drive

Mumbai 400 002

Maharashtra

Board of Directors

The Board of Directors consists of:

Name of the Director Designation DIN Address

Manish Kalani

Managing Director 00169041 11, Tukoganj

M. G. Road

Indore 452 001

B. Rajesh Nair

Executive Director 00061165 302, Shalimar Township

A. B. Road

Opposite Scheme No. 78

Indore 452 010

Sudarshan Bajoria

Non-Independent,

Non- Executive

Director appointed as

nominee of ICICI

Venture Funds

Management

Company Limited

01853708 Flat no. A- 402

4th

Floor

Golden Square

Sundar Nagar

Kalina, Santa Cruz (East)

Mumbai 400 098

Atul Ruia Non-Independent,

Non-Executive

Director appointed by

PML

00087396 Ruia House, 19 Bhau Sahib,

Hire Marg, Malabar Hill,

Mumbai 400 006

Balaji Sreekantiah Gubbi

Non-Independent,

Non- Executive

Director appointed by

02585676 304, Phoenix Tower, B Wing,

Senapati Bapat Marg, Lower

Parel, Mumbai 400 013

19

Name of the Director Designation DIN Address

PML

Paras Nath Pathak Non –Executive,

Independent Director

03085406 14/118, Indra Nagar, Lucknow

226 016

Mukesh Kacker Non- Executive,


01569098 5, Munirka Marg, Ground

Floor, Vasant Vihar, New

Delhi 110 057

Girish Raj Non –Executive,


00080058 Athina Township, 3rd

Stage,

Billishivale, Doddagubbi Post,

Banglore 562 149

Homi Aibara Non –Executive,


00273262 Jhaveri Mansion, 3rd

Floor, 30

Little Gibbs Road, Malabar

Hills, Mumbai 400 006

Suhail Nathani Non –Executive,


01089938 No. 801, Prabhu Kutir, 15

Altamount Road, Mumbai 400

026

For further details of the Directors, see “Management” on page 113 of this Draft Red Herring Prospectus.

Company Secretary and Compliance Officer

Bimal K. Nanda





Mahalaxmi

Mumbai 400 011

Maharashtra

Tel: (91 22) 4045 0555

Fax: (91 22) 4045 0512

Email: [email protected]

Investors can contact the Compliance Officer or the Registrar to the Issue 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 and refund orders.

Book Running Lead Managers

ICICI Securities Limited*

ICICI Centre,

H. T. Parekh Marg,

Churchgate,

Mumbai 400 020

Tel: (9122) 2288 2460

Fax: (91 22) 2282 6580

E-mail: [email protected]

Investor Grievance Email:

[email protected]

Website: www.icicisecurities.com

Contact Person: Mangesh Ghogle / Vishal Kanjani

Kotak Mahindra Capital Company Limited

1st Floor, Bakhtawar

229 Nariman Point

Mumbai 400 021

Tel: (91 22) 6634 1100

Fax: (91 22) 2283 7517


Investor Grievance Email:

[email protected]

Website: www.kotak.com

Contact Person: Chandrakant Bhole

SEBI Registration No.: INM000008704

mailto:[email protected]

20

SEBI Registration No.: INM000011179 *ICICI Securities Limited has made an application on April 7, 2010 with SEBI for

renewal of its certificate of registration

Edelweiss Capital Limited

14th

floor

Express Towers

Nariman Point

Mumbai 400 021

Tel: (91 22) 4086 3535

Fax: (91 22) 4086 3610


Investor Grievance Email: [email protected]

Website: www.edelcap.com

Contact Person: Neetu Ranka

SEBI Registration No.: INM0000010650

Legal Advisors

Domestic Legal Counsel to the Issue International Legal Counsel to the Underwriters

Amarchand & Mangaldas & Suresh A. Shroff & Co. Jones Day

5th

Floor, Peninsula Chambers

Peninsula Corporate Park

Ganpatrao Kadam Marg,

Lower Parel

Mumbai 400 013

Tel: (91 22) 2496 4455

Fax: (91 22) 2496 3666

3 Church Street

# 14-02 Samsung Hub

Singapore 049483

Tel.: (65) 6538 3939

Fax: (65) 6536 3939

Syndicate Members

[●]

Auditors to the Company

Deloitte Haskins & Sells, Chartered Accountants

12, Dr. Annie Besant Road,

Opp. Shiv Sagar Estate, Worli,

Mumbai 400 018

Tel: (91 22) 6667 9000

Fax: (91 22) 6667 9100


Membership no. of Ashesh Jani: 46488

Registrar to the Issue

Link Intime India Private Limited

C-13, Pannalal Silk Mills Compound

L.B.S. Marg, Bhandup (West)

Mumbai 400 078

Tel: (91 22) 2596 0320

Fax: (91 22) 2596 0329


Website: www.linkintime.co.in

21

Contact Person: Chetan Shinde

SEBI Registration No.: INR000004058

IPO Grading Agency

This Issue has been graded by [●] as [●], indicating [●]. The rationale furnished by the grading agency for its

grading will be updated at the time of filing the Red Herring Prospectus with the RoC.

Experts

The Company has obtained architect certificates dated May 31, 2010 from P.G. Patki Architects, The Design

Syndicate and Sanjay Puri Architects, Architects in relation to projects being developed by us. P.G. Patki Architects,

The Design Syndicate and Sanjay Puri Architects, Architects have given their written consent to act as experts to the

Company for the Issue in relation to the land and/or rights in respect thereof we own and such consent has not been

withdrawn up to the time of submission of the Draft Red Herring Prospectus.

The Issue has been graded by [●]. The report of [●] in respect of the IPO grading of this Issue will be annexed to the


Bankers to the Issue and Escrow Collection Banks

[●]

Bankers to the Company

Axis Bank Limited

Kamal Palace

1, Y N Road

Indore 452 001

Tel: (91 731) 4295222

Fax: (91 731) 4295330


Website: www.axisbank.com

Contact Person: T. P. Rao

UCO Bank

2/5, 3/5, Girnar Tower

New Palasia

Indore 452 001

Tel: (91 731) 2545514

Fax: (91 731) 2544166


Website: www.ucobank.com

Contact Person: G. Rajendiran

Self Certified Syndicate Banks

The list of banks that have been notified by SEBI to act as a SCSB for the ASBA process are provided on

www.sebi.gov.in. For details on Designated Branches of SCSBs collecting ASBA Bid Cum Application Forms,

please refer to the above mentioned link.

Monitoring Agency

There will be no monitoring agency as the Issue Size is proposed to be less than Rs. 5,000 million. The Board will

monitor the utilization of the Net Proceeds. The Company will disclose the utilization of the Net Proceeds under a

separate head in its Balance Sheet for the relevant financial years subsequent to the Issue. The Company will

indicate investments, if any, of unutilized Net Proceeds in the Balance Sheet of the Company for the relevant

financial years subsequent to the Issue.

Inter Se Allocation of Responsibilities between the BRLMs

The following table sets forth the inter se allocation of responsibilities for various activities among the BRLMs for

the Issue:

22

Activities Responsibility Co-

ordinator

1. Capital structuring with relative components and formalities I-Sec, Kotak, Edelweiss I-Sec

2. Drafting and approval of all statutory advertisements I-Sec, Kotak, Edelweiss I-Sec

3. Due diligence of the Company including its

operations/management/ business/plans/legal, etc. Drafting and

design of the Draft Red Herring Prospectus and of statutory

advertisements including a memorandum containing salient

features of the Prospectus.

The BRLMs shall ensure compliance with stipulated requirements

and completion of prescribed formalities with the Stock

Exchanges, the RoC and SEBI including finalisation of the

Prospectus and RoC filing.

I-Sec, Kotak, Edelweiss I-Sec

4. Drafting and approval of all publicity material other than statutory

advertisements as mentioned above, including corporate

advertising, brochures, etc.

I-Sec, Kotak, Edelweiss Edelweiss

5. Appointment of Bankers to the Issue and Registrar to the Issue I-Sec, Kotak, Edelweiss I-Sec

6. Appointment of other intermediaries including, printers,

advertising agency


7. Marketing & road show presentation I-Sec, Kotak, Edelweiss Kotak

8. Non-institutional and Retail marketing of the Issue, which will

cover, inter alia:

Finalising media, marketing and public relations

strategy;

Finalising centre for holding conferences for brokers,

etc.;

Follow-up on distribution of publicity and Issue material

including forms, the Prospectus and deciding on the

quantum of Issue material; and

Finalising collection centres.

I-Sec, Kotak, Edelweiss Kotak

9. Domestic institutional marketing of the Issue, which will cover,

inter alia:

Finalising the list and division of investors for one to one

meetings, institutional allocation


10. International institutional marketing of the Issue, which will

cover, inter alia:

Finalising the list and division of investors for one-to-

one meetings, institutional allocation.


11. Pricing, Managing the book and allocation to QIB Bidders I-Sec, Kotak, Edelweiss Edelweiss

12. Co-ordination with the Stock Exchanges I-Sec, Kotak, Edelweiss Edelweiss

13. Post-Bidding activities including management of escrow

accounts, co coordinating, underwriting, co-ordination of non-

institutional allocation, announcement of allocation and dispatch

of refunds to Bidders, etc.

The post-Issue activities will involve essential follow up steps,

including the finalisation of trading, dealing of instruments, and

demat of delivery of shares with the various agencies connected

with the work such as the Registrars to the Issue, the Bankers to

the Issue, the bank handling refund business and SCSBs. The

I-Sec, Kotak, Edelweiss Kotak

23

BRLMs shall be responsible for ensuring that these agencies

fulfill their functions and discharge this responsibility through

suitable agreements with the Company. Note: ICICI Securities Limited has made an application on April 7, 2010 with SEBI for renewal of its certificate of registration

Credit Rating

As the Issue is of Equity Shares, there is no credit rating for this Issue.

Trustees

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

Book Building Process

Book Building Process, with reference to the Issue, refers to the process of collection of Bids on the basis of the Red

Herring Prospectus within the Price Band, which will be decided by the Company in consultation with the BRLMs

and advertised at least two working days prior to the Bid/Issue Opening Date. The Issue Price is finalised after the

Bid/ Issue Closing Date. The principal parties involved in the Book Building Process are:

1. the Company;

2. the BRLMs;

3. the Syndicate Members who are intermediaries registered with SEBI or registered as brokers with BSE/

NSE and eligible to act as Underwriters. The Syndicate Members are appointed by the BRLMs;

4. the SCSBs;

5. the Registrar to the Issue; and

6. the Escrow Collection Banks.

This Issue is being made in accordance with Rule 19(2)(b)(i) of the SCRR and under the SEBI Regulations, where

the Issue will be made through the 100% Book Building Process wherein at least 50% of the Issue will be allocated

on a proportionate basis to QIBs. Out of the QIB Portion (excluding the Anchor Investor Portion), 5% shall be

available for allocation on a proportionate basis to Mutual Funds only. The remainder shall be available for

allocation on a proportionate basis to QIBs and Mutual Funds, subject to valid Bids being received from them at or

above the Issue Price. If at least 50% of the Issue cannot be allotted to QIBs, then the entire application money will

be refunded forthwith. Further, not less than 15% of the Issue will be available for allocation on a proportionate

basis to Non-Institutional Bidders and not less than 35% of the Issue will be available for allocation on a

proportionate basis to Retail Individual Bidders, subject to valid Bids being received at or above the Issue Price.

In accordance with the SEBI Regulations, QIB Bidders are not allowed to withdraw their Bid(s) after the

Bid/Issue Closing Date. For further details, see “Terms of the Issue” on page 325 of this Draft Red Herring

Prospectus.

The Company shall comply with the SEBI Regulations and any other ancillary directions issued by SEBI for this

Issue. In this regard, the Company has appointed the BRLMs to manage the Issue and procure subscriptions to the

Issue.

The Book Building Process under the SEBI Regulations is subject to change from time to time and the

investors are advised to make their own judgment about investment through this process prior to making a

Bid or application in the Issue.

Illustration of Book Building Process and Price discovery process (Investors should note that this example is

solely for illustrative purposes and is not specific to the Issue; it excludes bidding by Anchor Investors or ASBA

process)

Bidders can bid at any price within the price band. For instance, assume a price band of Rs. 20 to Rs. 24 per equity

share, issue size of 3,000 equity shares and receipt of five bids from bidders, details of which are shown in the table

24

below. A graphical representation of the consolidated demand and price would be made available at the bidding

centres during the bidding period. The illustrative book below shows the demand for the equity shares of the issuer

company at various prices which is collated from bids received from various investors.

Bid Quantity Bid Amount (Rs.) Cumulative Quantity Subscription

500 24 500 16.67%

1,000 23 1,500 50.00%

1,500 22 3,000 100.00%

2,000 21 5,000 166.67%

2,500 20 7,500 250.00%

The price discovery is a function of demand at various prices. The highest price at which the issuer is able to issue

the desired number of shares is the price at which the book cuts off, i.e., Rs. 22 in the above example. The issuer, in

consultation with the BRLMs, will finalise the issue price at or below such cut-off price, i.e., at or below Rs. 22. All

bids at or above this issue price and cut-off bids are valid bids and are considered for allocation in the respective

categories.

Steps to be taken by the Bidders for Bidding

1. Check eligibility for making a Bid (see “Issue Procedure - Who Can Bid?” on page 333 of this Draft Red

Herring Prospectus);

2. Ensure that you have a demat account and the demat account details are correctly mentioned in the Bid cum

Application Form;

3. Ensure that you have mentioned your PAN, Client ID and DP ID in the Bid cum Application Form. In

accordance with the SEBI Regulations, PAN would be the sole identification number for participants

transacting in the securities market, irrespective of the amount of transaction (see “Issue Procedure –

Permanent Account Number or PAN” on page 349 of this Draft Red Herring Prospectus);

4. Ensure that the Bid cum Application Form is duly completed as per instructions given in this Draft Red

Herring Prospectus and in the Bid cum Application Form;

5. Bids by QIBs (including Anchor Investors) will only have to be submitted to the BRLMs and/or their

affiliates, other than Bids by QIBs (excluding the Anchor Investors) who Bid through ASBA process, who

shall submit the Bids to the Designated Branches of the SCSBs;

6. ASBA Bidders will have to submit Bids (physical form) to the Designated Branches. ASBA Bidders should

ensure that the ASBA Account has adequate credit balance at the time of submission to the SCSB to ensure

that the ASBA Bid cum Application Form is not rejected.

Underwriting Agreement

After the determination of the Issue Price but prior to the filing of the Prospectus with the RoC, the Company will

enter into an Underwriting Agreement with the Underwriters for the Equity Shares proposed to be offered through

the Issue. It is proposed that pursuant to the terms of the Underwriting Agreement, the BRLMs shall be responsible

for bringing in the amount devolved in the event that the Syndicate Members do not fulfil their underwriting

obligations. The underwriting shall be to the extent of the Bids uploaded by the Underwriters including through its

respective Syndicate Member/ sub-syndicate. The Underwriting Agreement is dated [ ].

The Underwriters have indicated their intention to underwrite the following number of Equity Shares:

This portion has been intentionally left blank and will be filled in before filing of the Prospectus with the RoC.

25

Name and Address of the Underwriters Indicated Number

of Equity Shares to

be Underwritten

Amount

Underwritten

(Rs. in Million)

ICICI Securities Limited ICICI Centre, H. T. Parekh Marg, Churchgate, Mumbai 400 020

[●] [●]

Kotak Mahindra Capital Company Limited

1st Floor, Bakhtawar, 229 Nariman Point, Mumbai 400 021

[●] [●]

Edelweiss Capital Limited

14th

floor, Express Towers, Nariman Point, Mumbai 400 021

[●] [●]

The above mentioned is indicative underwriting and this will be finalised after determination of the Issue Price and

actual allocation.

In the opinion of the Board of Directors (based on a certificate given by the Underwriters), the resources of the

above mentioned Underwriters are sufficient to enable them to discharge their respective underwriting obligations in

full. The above mentioned Underwriters are registered with SEBI under Section 12(1) of the SEBI Act or registered

as brokers with the Stock Exchange(s). The Board of Directors, at its meeting held on [●], has accepted and entered

into the Underwriting Agreement mentioned above on behalf of the Company.

Allocation among Underwriters may not necessarily be in proportion to their underwriting commitments.

Notwithstanding the table above, the BRLMs and the Syndicate Members shall be responsible for ensuring payment

with respect to Equity Shares allocated to investors procured by them. In the event of any default in payment, the

respective Underwriter, in addition to other obligations defined in the Underwriting Agreement, will also be required

to procure subscriptions for/subscribe to Equity Shares to the extent of the defaulted amount.

Notwithstanding the foregoing, the Issue is also subject to obtaining (i) final listing and trading approvals of the

Stock Exchanges, which the company shall apply for after Allotment, and (ii) the final approval of the RoC after the

Prospectus is filed with the RoC.

26

CAPITAL STRUCTURE

The Equity Share capital of the Company as of the date of this Draft Red Herring Prospectus is set forth below:

(In Rs. except share data)

Aggregate

Nominal Value

Aggregate Value

at Issue Price

A) AUTHORISED SHARE CAPITAL

150,000,000 Equity Shares of Rs. 10 each 1,500,000,000

B) ISSUED, SUBSCRIBED AND PAID UP SHARE CAPITAL

BEFORE THE ISSUE(1)

62,957,184 Equity Shares of Rs. 10 each 629,571,840

C) PRESENT ISSUE IN TERMS OF THIS DRAFT RED

HERRING PROSPECTUS

38,928,943 Equity Shares of Rs. 10 each 389,289,430 [●]

D) ISSUED, SUBSCRIBED AND PAID-UP EQUITY CAPITAL

AFTER THE ISSUE

129,763,143 Equity Shares of Rs. 10 each 1,297,631,430 [●]

E) SHARE PREMIUM ACCOUNT Before the Issue(1) 152,639,261 -

After the Issue [●] [●]

The present Issue in terms of this Draft Red Herring Prospectus has been authorised by the Board of Directors and

the shareholders of the Company, pursuant to their resolutions dated June 11, 2010 and June 15, 2010 respectively. (1) Pursuant to a securities subscription and shareholders’ agreement dated November 1, 2006 between the Company, IAF - III, Promoters and

Ashok Ruia Enterprises Private Limited (merged with PML) (“Agreement”), the Company has issued and allotted 7,500,000 optionally

convertible debentures of Rs. 100 each (“OCDs”) to IAF - III which will convert into 27,877,016 Equity Shares at a conversion price to be

determined in accordance with the terms of the Agreement, prior to the filing of the Red Herring Prospectus with the RoC. Of, 27,877,016, Equity Shares that will be allotted to IAF - III, 11,463,276 Equity Shares aggregating to 8.83% of the post-Issue paid-up capital of the

Company will be held in an escrow account with an escrow agent in accordance with the terms of the Agreement(“Escrow Equity Shares”). The Escrow Equity Shares shall be released from the escrow account proportionately to the Promoters and IAF - III depending on the value

realised on sale of balance Equity Shares by IAF - III and the return on investment computed as per a prescribed multiple of cost or IRR

structure, whichever is higher, as specified under the Agreement, after the mandatory lock-in period of one year from the date of allotment of Equity Shares in the Issue. The Promoters and IAF - III will enter into an escrow Agreement with an escrow agent prior to the conversion of

OCDs into Equity Shares and filing of the Red Herring Prospectus with the RoC. The details of the conversion price and the escrow

agreement will be updated in the Red Herring Prospectus prior to filing with the RoC. For further details in relation to the Agreement, see “History and Certain Corporate Matters - Shareholder Agreements/ Other Key Agreements” on page 110 of this Draft Red Herring

Prospectus.

Changes in Authorised Share Capital

1. The initial authorised share capital of Rs. 2,500,000 divided into 250,000 Equity Shares of Rs. 10 each was

increased to Rs. 100,000,000 divided into 2,092,745 Class A equity shares of Rs. 10 each with voting rights

and 7,907,255 Class B equity shares of Rs. 10 each without voting rights, pursuant to resolution of

shareholders passed at the AGM held on July 7, 2003.

2. The authorised share capital of Rs. 100,000,000 divided into 2,092,745 Class A equity shares of Rs. 10

each with voting rights and 7,907,255 Class B equity shares of Rs. 10 each without voting rights was

consolidated into 1,000,000 equity shares of Rs. 100 each with voting rights, pursuant to resolution of

shareholders passed at an EGM held on January 19, 2004.

3. The authorised share capital of Rs. 100,000,000 divided into 1,000,000 equity shares of Rs.100 each was

increased to Rs. 113,000,000 divided into 1,130,000 equity shares of Rs. 100 each pursuant to resolution of

shareholders passed at the AGM held on September 30, 2004.

27


increased to Rs. 150,000,000 divided into 1,500,000 equity shares of Rs. 100 each pursuant to resolution of

shareholders passed at an EGM held on March 10, 2006.


sub-divided into 15,000,000 Equity Shares of Rs. 10 each pursuant to resolution of shareholders passed at

an EGM held on March 10, 2006.

6. The authorised share capital of Rs. 150,000,000 divided into 15,000,000 Equity Shares of Rs. 10 each was

increased to Rs. 170,000,000 divided into 17,000,000 Equity Shares of Rs. 10 each pursuant to resolution

of shareholders passed at an EGM held on June 27, 2007.

7. The authorised share capital of Rs. 170,000,000 divided into 17,000,000 Equity Shares of Rs. 10 each was

increased to Rs. 1,000,000,000 divided into 100,000,000 Equity Shares of Rs. 10 each pursuant to

resolution of shareholders passed at an EGM held on January 22, 2010.

8. The authorised share capital of Rs. 1,000,000,000 divided into 100,000,000 Equity Shares of Rs. 10 each

was increased to Rs. 1,500,000,000 divided into 150,000,000 Equity Shares of Rs. 10 each pursuant to

resolution of shareholders passed at an EGM held on May 12, 2010.

Notes to Capital Structure

1. Share Capital History of the Company

(a) The history of the equity share capital and share premium account of the Company is set forth below:

Date of

allotment of

Equity Shares

No. of

Equity

Shares

allotted

Face

Value

(Rs.)

Issue

Price

(Rs.)

Consideration

Cumulative no.

of Equity

Shares

Cumulative paid-up

Equity Share

Capital (Rs.)

Cumulative

Share Premium

(Rs.)

July 22, 1999 20 10 10 Cash 20 200 -

December 7,

2002

249,980 10 10 Cash 250,000 2,500,000 -

July 7, 2003 775,445(1) 10 10 Cash 1,025,445 10,254,450 -

July 7, 2003 1,067,300(2) 10 - Other than

Cash(2)

2,092,745 20,927,450 -

July 7, 2003 7,907,255(3) 10 10 Cash 10,000,000 100,000,000 -

January 19, 2004(4)

- 100 - - 1,000,000 100,000,000 -

December 11,

2004

66,960 100 1,000 Cash 1,066,960 106,696,000 60,264,000

March 20, 2005 57,350 100 1,000 Cash 1,124,310 112,431,000 111,879,000

March 10, 2006(5)

- 10 - - 11,243,100 112,431,000 111,879,000

September 12,

2006

2,716,131 10 108.17 Cash 13,959,231 139,592,310 378,521,580

December 1,

2006

49,000 10 102.04 Cash 14,008,231 140,082,310 383,031,540

March 8, 2007 991,769 10 108.17 Cash 15,000,000 150,000,000 480,393,503

April 5, 2007 - - - - 13,932,700(6) 139,327,000(6) 473,968,095(7)

June 27, 2007 580,013 10 108.17 Cash 14,512,713 145,127,130 530,907,971

December 14,

2007

1,226,583 10 86.56 Cash 15,739,296 157,392,960 624,818,141

June 11, 2010 47,217,888 10 - Bonus issue in

the ratio 3:1

62,957,184(7) 629,571,840(7) 152,639,261(8)

(1) The Company issued 775,445 Class A equity shares of Rs. 10 each at par to PHPL and KBIPL.

(2) The Company issued 1,067,300 Class A equity shares of Rs. 10 each to Madhya Pradesh Housing Board as consideration for supervisory

services to be provided by MPHB.

(3) The Company issued 7,907,255 Class B equity shares of Rs. 10 each without voting rights to PHPL and KBIPL.

28

(4) The authorised share capital of Rs. 100,000,000 divided into 2,092,745 Class A equity shares of Rs. 10 each with voting rights and

7,907,255 Class B equity shares of Rs. 10 each without voting rights was consolidated into 1,000,000 equity shares of Rs. 100 each with

voting rights, pursuant to resolution of shareholders passed at an EGM held on January 19, 2004.

(5) The authorised share capital of Rs. 150,000,000 divided into 1,500,000 equity shares of Rs. 100 each was sub-divided into 15,000,000

equity shares of Rs. 10 each pursuant to resolution of shareholders passed at an EGM held on March 10, 2006.

(6) Forfeiture of 1,067,300 equity shares of Rs. 10 each allotted to Madhya Pradesh Housing Board.

(7) Rs. 6,425,408 has been provided towards debenture issue expenses on March 31, 2007. (8) Pursuant to a securities subscription and shareholders’ agreement dated November 1, 2006 between the Company, IAF - III, Promoters

and Ashok Ruia Enterprises Private Limited (merged with PML) (“Agreement”), the Company has issued and allotted 7,500,000 optionally convertible debentures of Rs. 100 each (“OCDs”) to IAF - III which will convert into 27,877,016 Equity Shares at a conversion

price to be determined in accordance with the terms of the Agreement, prior to the filing of the Red Herring Prospectus with the RoC. Of,

27,877,016, Equity Shares that will be allotted to IAF - III, 11,463,276 Equity Shares aggregating to 8.83% of the post-Issue paid-up capital of the Company will be held in an escrow account with an escrow agent in accordance with the terms of the Agreement(“Escrow

Equity Shares”). The Escrow Equity Shares shall be released from the escrow account proportionately to the Promoters and IAF - III

depending on the value realised on sale of balance Equity Shares by IAF - III and the return on investment computed as per a prescribed

multiple of cost or IRR structure, whichever is higher, as specified under the Agreement, after the mandatory lock-in period of one year

from the date of allotment of Equity Shares in the Issue. The Promoters and IAF - III will enter into an escrow Agreement with an escrow

agent prior to the conversion of OCDs into Equity Shares and filing of the Red Herring Prospectus with the RoC. The details of the conversion price and the escrow agreement will be updated in the Red Herring Prospectus prior to filing with the RoC. For further details

in relation to the Agreement, see “History and Certain Corporate Matters - Shareholder Agreements/ Other Key Agreements” on page

110 of this Draft Red Herring Prospectus.

(b) Equity Shares Allotted for consideration other than cash:

Date of allotment

of the Equity

Shares

No. of Equity

Shares

Face Value

(Rs.)

Issue Price

(Rs.)

Consideration

July 7, 2003 1,067,300*

10 - Issued by the Company

as consideration for the

supervisory services to

be provided by Madhya

Pradesh Housing Board

June 11, 2010 47,217,888 10 - Bonus issue in the ratio

3:1 * These Equity Shares were forfeited on April 5, 2007.

2. History of the Equity Share Capital held by the Promoters

(a) Details of the build up of Promoters shareholding in the Company is set forth below:

Date of

Allotment/Transfer

Nature of

Transaction

Nature of

consideration

No. of Equity

Shares

Face

Value

Issue/

Acquisition

Price (Rs.)

Cumulative no. of

Equity Shares

% of Pre Issue Capital % of

Post

Issue

Capital

Pre OCD

Conversion

Post OCD

Conversion

Manish Kalani

July 22, 1999 Issued pursuant

to subscription to

Memorandum of

Association

Cash 10 10 10 10 0.00 0.00 0.00

May 14, 2003 Transfer to

KBIPL

Cash (10) 10 10 - 0.00 0.00 0.00

December 23, 2005 Transfer from

KBIPL

Cash 10 100(1)

1,000 10 0.00 0.00 0.00

June 11, 2010 Bonus issue in

the ratio 3:1

- 300 10(2)

- 400 0.00 0.00 0.00

PHPL

February 28, 2003 Transfer from

Kalani Industries

Private Limited

Cash 73,780 10 10 73,780 0.12 0.08 0.06

July 7, 2003 Allotment of

Class A equity

shares to

augment the

Cash 228,911 10 10 302,691 0.48 0.33 0.23

29

Date of

Allotment/Transfer

Nature of

Transaction

Nature of

consideration

No. of Equity

Shares

Face

Value

Issue/

Acquisition

Price (Rs.)

Cumulative no. of

Equity Shares


Post

Issue

Capital

Pre OCD

Conversion

Post OCD

Conversion

financial

resources


Class B equity

shares to

augment the

financial

resources

Cash 2,334,222 10 10 2,636,913 4.19 2.90 2.03

December 11, 2004 Allotment of

equity shares to

augment the

financial

resources

Cash 19,669 100(1)

1,000 283,360 0.45 0.31 0.22

July 7, 2006 Transfer from

Oswal Tradelink

Private Limited

Cash 16,600 100 80 299,960 0.48 0.33 0.23

September 12, 2006 Transfer from

Manisha Kalani

Cash 100 10(2)

10 2,999,700 4.76 3.30 2.31

September 12, 2006 Allotment of

equity shares to

augment the

financial

resources

Cash 390,336 10 108.17 3,390,036 5.38 3.73 2.61

June 27, 2007 Transfer to

Kalani Holdings

Private Limited

(a wholly owned

subsidiary of The

Phoenix Mills

Limited)

Cash (390,336) 10 108.17 2,999,700 4.76 3.30 2.31


the ratio 3:1

- 8,999,100 10 - 11,998,800(3)

19.06 11.57 8.10

KBIPL

February 28, 2003 Transfer from

Kalani Industries

Private Limited

Cash 176,200 10 10 176,200 0.28 0.19 0.14

May 14, 2003 Transfer from

various persons(4)

Cash 20 10 10 176,220 0.28 0.19 0.14


Class A equity

shares to

augment the

financial

resources

Cash 546,534 10 10 722,754 1.15 0.80 0.56


Class B equity

shares

Cash 5,573,033 10 10 6,295,787 10.00 6.93 4.85

December 11, 2004 Allotment of

equity shares to

augment the

financial

resources

Cash 47,291 100(1)

1,000 676,870 1.08 0.75 0.52

December 23, 2005 Transfer from

various

companies(5)

Cash 2,000 100 100 678,870 1.08 0.75 0.52

December 23, 2005 Transfer to

various persons

and companies(6)

Cash (60) 100 100 678,810 1.08 0.75 0.52


Ratnagiri

Vinimay

Cash 38,750 100 80 717,560 1.14 0.79 0.55


various persons

and companies(7)

Cash 40 100 1,000 717,600 1.14 0.79 0.55

September 12, 2006 Allotment of

equity shares to

augment the

financial

resources

Cash 800,601 10(2)

108.17 7,976,601 12.67 8.78 6.15

June 27, 2007 Transfer to

Kalani Holdings

Private Limited

(a wholly owned

subsidiary of The

Phoenix Mills

Limited)

Cash (800,601) 10 108.17 7,176,000 11.40 7.90 5.53

January 19, 2008 Transfer to Ruia

Real Estate

Development

Company Private

Cash (824,739) 10 10 6,351,261 10.09 6.99 4.89

30

Date of

Allotment/Transfer

Nature of

Transaction

Nature of

consideration

No. of Equity

Shares

Face

Value

Issue/

Acquisition

Price (Rs.)

Cumulative no. of

Equity Shares


Post

Issue

Capital

Pre OCD

Conversion

Post OCD

Conversion

Limited (merged

with The Phoenix

Mills Limited)

January 21, 2010 Transfer to B.

Rajesh Nair

Cash (10) 10 10 6,351,251 10.09 6.99 4.89


the ratio 3:1

- 19,053,753 10 - 25,405,004(3)

40.35 24.52 17.17

(1) The authorised share capital of Rs. 100,000,000 divided into 2,092,745 Class A equity shares of Rs. 10 each with voting rights and

7,907,255 Class B equity shares of Rs. 10 each without voting rights was consolidated into 1,000,000 equity shares of Rs. 100 each with voting rights, pursuant to resolution of shareholders passed at an EGM held on January 19, 2004.

(2) The authorised share capital of Rs. 150,000,000 divided into 1,500,000 equity shares of Rs.100 each was sub-divided into 15,000,000

Equity Shares of Rs. 10 each pursuant to resolution of shareholders passed at an EGM held on March 10, 2006.

(3) PHPL and KBIPL have agreed to transfer 1,488,689 Equity Shares and 3,129,657 Equity Shares, respectively, to PML prior to the filing

of the Red Herring Prospectus with the RoC, in terms of a letter dated June 18, 2010, such that post conversion of the OCDs (prior to

filing of the Red Herring Prospectus with the RoC) held by IAF - III into the Equity Shares of the Company and prior to the Issue, KHPL

(a wholly owned subsidiary of PML) and PML together hold an aggregate of 33% of the pre-Issue equity share capital of the Company.

The details of this transfer will be updated prior to filing the Red Herring Prospectus with the RoC. Additionally, a deed of adherence and

modification to the securities subscription and shareholders agreement was executed on July 9, 2010 pursuant to which PML and KHPL

has agreed to transfer the Promoter Sale Shares (as defined below) back to the Promoters on default of certain obligations as provided under the said securities subscription and shareholders agreement. For further details, see “History and Certain Corporate Matters -

Shareholder Agreements/ Other Key Agreements”on page 110 of this Draft Red Herring Prospectus.

(4) Transferred from Manish Kalani, T.S. Summi, Padma Kalani, Manisha Kalani, S.K. Talati, Q.Y. Matkawala and Pawan Jain.

(5) Transferred from Money Penny Fincom Private Limited, Prmila Investment and Finance Limited and Maxtouch Securities Private

Limited.

(6) Transferred to Manish Kalani, Padma Kalani, Manisha Kalani, Anshuman Properties Private Limited, Vibgyor Laminates Private

Limited and Sanovi Trading Private Limited.

(7) Transferred from Sanovi Trading Private Limited, Anshuman Properties Private Limited, Vibgyor Laminates Private Limited and Padma

Kalani.

(b) Details of Promoters contribution locked in for three years

The minimum Promoter‟s contribution has been brought to the extent of not less than the specified

minimum lot and from persons defined as Promoters under the SEBI Regulations. Pursuant to the SEBI

Regulations, 20% of the fully diluted post-Issue capital of the Company held by the Promoters shall be

locked in for a period of three years from the date of Allotment of Equity Shares in the Issue. The Equity

Shares constituting minimum Promoters‟ contribution in the Issue which shall be locked-in for three years

are eligible therefor in terms of the SEBI Regulations. The details of such lock-in are set forth in the table

below:

Date of Acquisition

and when made

fully paid-up

Nature of

Allotment/Transfer

Nature of

consideration

No. of Equity Shares Face

Value

Issue/Acquisition

Price (Rs.)

Percentage of

Post-Issue

Paid-up

Capital

PHPL

February 28, 2003 Transfer from Kalani

Industries Private

Limited

Cash 73,780 10 10 0.06

July 7, 2003 Allotment of Class A

equity shares to augment the financial resources

Cash 228,911 10 10 0.18

July 7, 2003 Allotment of Class B

equity shares to augment

the financial resources

Cash 2,334,222 10 10 1.80

December 11, 2004 Allotment of equity

shares to augment the

financial resources

Cash 19,669 100(1) 1000 0.15

July 7, 2006 Transfer from Oswal Tradelink Private

Cash 16,600 100 80 0.13

31

Date of Acquisition

and when made

fully paid-up

Nature of

Allotment/Transfer

Nature of

consideration

No. of Equity Shares Face

Value

Issue/Acquisition

Price (Rs.)

Percentage of

Post-Issue

Paid-up

Capital

Limited

September 12, 2006

Transfer from Manisha Kalani

Cash 100 10(2) 10 0.00

June 11, 2010 Bonus Issue in the ratio

3:1

- 7,510,411 10 - 5.79

Total 10,510,111(3) 8.10

KBIPL

February 28, 2003 Transfer from Kalani Industries Private

Limited

Cash 176,200 10 10 0.14

May 14, 2003 Transfer from various

persons

Cash 20 10 10 0.00

July 7, 2003 Allotment of Class A

equity shares to augment

the financial resources

Cash 546,534 10 10 0.42

July 7, 2003 Allotment of Class B equity shares

Cash 4,748,284 10 10 3.66

December 11, 2004 Allotment of equity

shares to augment the financial resources

Cash 47,291 100(1) 1,000 0.36

December 23, 2005 Transfer from various

companies

Cash 1,940 100 100 0.02

July 7, 2006 Transfer from Ratnagiri Vinimay

Cash 38,750 100 80 0.30

July 7, 2006 Transfer from various

persons and companies

Cash 40 100 1,000 0.00

June 11, 2010 Bonus Issue - 9,091,267 10(2) - 7.01

Total 15,442,518(4) 11.90

Grand Total 25,952,629 20.00 (1) The authorised share capital of Rs. 100,000,000 divided into 2,092,745 Class A equity shares of Rs. 10 each with voting rights and

7,907,255 Class B equity shares of Rs. 10 each without voting rights was consolidated into 1,000,000 equity shares of Rs. 100 each with voting rights, pursuant to resolution of shareholders passed at an EGM held on January 19, 2004.

(2) The authorised share capital of Rs. 150,000,000 divided into 1,500,000 equity shares of Rs.100 each was sub-divided into 15,000,000

Equity Shares of Rs. 10 each pursuant to resolution of shareholders passed at an EGM held on March 10, 2006.

(3) The number of Equity Shares being offered by PHPL towards Promoter’s contribution have been computed on a fully diluted basis, taking

into account Equity Shares that will be issued to IAF - III on conversion of OCDs prior to filing the Red Herring Prospectus with RoC as well as the proposed transfer of 1,488,689 Equity Shares to PML prior to filing the Red Herring Prospectus with RoC. For further details,

see “History and Certain Corporate Matters - Shareholder Agreements/ Other Key Agreements”on page 110 of this Draft Red Herring

Prospectus. (4) The number of Equity Shares being offered by KBIPL towards Promoter’s contribution have been computed on a fully diluted basis, taking

into account Equity Shares that will be issued to IAF - III on conversion of OCDs prior to filing the Red Herring Prospectus with RoC as well as the proposed transfer of 3,129,657 Equity Shares to PML prior to filing the Red Herring Prospectus with RoC. For further details,

see “History and Certain Corporate Matters - Shareholder Agreements/ Other Key Agreements”on page 110 of this Draft Red Herring

Prospectus.

(c) Details of share capital locked in for one year

In addition to 20% of the post-Issue shareholding of the Company held by Promoters and locked in for

three years as specified above, the entire pre-Issue equity share capital will be locked-in for a period of one

year from the date of Allotment of the Equity Shares in this Issue.

In terms of SEBI Regulations, Equity Shares held by the shareholders who are venture capital funds /

venture capital investor, for a period of at least one year as on the date of this Draft Red Herring Prospectus

will not be subject to lock in as aforesaid. The details of such Equity Shares held by the venture capital

funds / venture capital investor are set forth in the table below:

32

Name of

shareholder

Date of acquisition Nature of

acquisition

No. of Equity Shares

IAF - III* November 1, 2006 Allotment 49,000

* IDBI Trusteeship Services Limited (the merged entity after its merger with the Western India Trustee and Executor Company

Limited) in its capacity as trustee of India Advantage Fund - III represented by its investment manager ICICI Venture Funds Management Company Limited which is registered with SEBI as a venture capital fund.

However, the Equity Shares held by IAF - III pursuant to the bonus issue on June 11, 2010, being 147,000

Equity Shares will be subject to lock-in for a period of one year from the date of allotment of the Equity

Shares in this Issue.

(d) Lock-in of Equity Shares to be issued, if any, to the Anchor Investor

Any Equity Shares that may be Allotted to Anchor Investors under the Anchor Investor Portion, if any,

shall be locked-in for a period of 30 days from the date of Allotment of Equity Shares in the Issue.

(e) Other Requirements in respect of lock-in

The Equity Shares held by Promoters may be transferred to and amongst the Promoter Group or to a new

promoter or persons in control of the Company, subject to continuation of the lock-in in the hands of the

transferees for the remaining period and compliance with the SEBI Takeover Regulations, as applicable.

The Equity Shares held by persons other than Promoters prior to the Issue may be transferred to any other

person holding Equity Shares which are locked-in along with the Equity Shares proposed to be transferred,

subject to continuation of the lock-in in the hands of the transferees for the remaining period and

compliance with the SEBI Takeover Regulations, as applicable.

The Equity Shares held by Promoters which are locked-in for a period of three years from the date of

Allotment in the Issue can be pledged with any scheduled commercial bank or public financial institution

as collateral security for loans granted by such banks or institution, provided that the pledge of Equity

Shares can be created when the loan has been granted by such bank or financial institution for financing

one or more of the objects of the Issue and pledge of Equity Shares is one of the terms of sanction of the

loan.

The Equity Shares held by the Promoter which are locked-in for a period of one year from the date of

Allotment in the Issue can be pledged with any scheduled commercial bank or public financial institution

as collateral security for loans granted by such bank or financial institution, provided that the pledge of the

Equity Shares is one of the terms of sanction of the loan.

3. Shareholding pattern of the Company

The table below presents the shareholding pattern before the proposed Issue and as adjusted for the Issue:

Category of

Shareholders

No. of

Sharehold

er

Pre-Issue (Prior to conversion of OCDs)(1)

Pre-Issue (Post-conversion of OCDs and transfer

of shares by PHPL and KBIL to PML) (2)

Post-Issue Shares pledged

or otherwise

encumbered

Total

No. of

Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Total

No. of

Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Total No.

of Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Numb

er of

shares

As a

% of

Total

No.

of

Shar

es As a

% of

(A+

B)

As a %

of

(A+B+

C)

As a

% of

(A+

B)

As a %

of

(A+B+

C)

As a

% of

(A+B

)

As a %

of

(A+B+

C)

(A)

Shareholding

of Promoter

and Promoter

Group*

(1) Indian

Individuals /

Hindu

Undivided

Family

1 400 Nil 0.00 0.00 400 Nil 0.00 0.00 400 0.00 0.00 Nil Nil

Central Government/

State

Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil

33

Category of

Shareholders

No. of

Sharehold

er





or otherwise

encumbered

Total

No. of

Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Total

No. of

Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Total No.

of Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Numb

er of

shares

As a

% of

Total

No.

of

Shar

es As a

% of

(A+

B)

As a %

of

(A+B+

C)

As a

% of

(A+

B)

As a %

of

(A+B+

C)

As a

% of

(A+B

)

As a %

of

(A+B+

C)

Governments

Bodies

Corporate 3 42,167,5

52

Nil 66.9

8

66.98 37,549,2

06

Nil 41.3

4

41.34 37,549,206 28.94 28.94 Nil Nil

Financial

Institutions/

Banks


Any other

(specify)


Sub Total(1) 4 42,167,9

52

Nil 66.9

8

66.98 37,549,6

06

Nil 41.3

4

41.34 37,549,606 28.94 28.94 Nil Nil

(2) Foreign

Individuals

(Non-Resident

Individuals/

Foreign

Individuals)


Bodies

Corporate


Institutions Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil

Any other

(specify)


Sub Total(2) Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil

Total

shareholding

of Promoter

and Promoter

Group (1) + (2)

(A)

4 42,167,9

52

Nil 66.9

8

66.98 37,549,6

06

Nil 41.3

4

41.34 37,549,606 28.94 28.94 Nil Nil

(B) Public

Shareholding

(1) Institutions

Mutual Funds /

UTI

Nil Nil Nil Nil Nil Nil Nil Nil Nil

Financial

Institutions /

Banks


Central

Government /

State Government(s)


Venture Capital Funds

1 196,000 Nil 0.31 0.31 28,073,016

Nil 30.91

30.91

Insurance Companies


Foreign Institutional

Investors


Foreign Venture

Capital

Investors


Any other

(specify)


Sub Total

(1)

1 196,000 Nil 0.31 0.31 28,073,0

16

Nil 30.9

1

30.91

(2) Non-

Institutions

Bodies

Corporate 1 20,593,1

92

Nil 32.7

1

32.71 25,211,5

38

Nil 27.7

6

27.76

Individuals

Individual

shareholders

holding nominal

share capital up

to Rs. 1 lakh

1 40 Nil 0.00 0.00 40 Nil 0.00 0.00

Individu

al

sharehol

ders

holding

nominal

share

capital in excess of

Rs. 1

lakh


Any Others

(Specify)

Non Resident

Indians


Trusts Nil Nil Nil Nil Nil Nil Nil Nil Nil

Clearing

Members


Overseas

Corporate

Bodies


Foreign

Corporate

Bodies


Foreign

Nationals


Sub Total (2) 2 20,593,2

32

Nil 32.7

1

32.71 25,211,5

78

Nil 27.7

6

27.76

Total Public

shareholding

(1) + (2) (B)

3 20,789,2

32

Nil 33.0

2

33.02 53,284,5

94

Nil 58.6

6

58.66 92,213,537 71.06 71.06

Total (A)+(B) 7 62,957,1 Nil 100 100 90,834,2 Nil 100 100 129,763,14 100.0 100.00

34

Category of

Shareholders

No. of

Sharehold

er





or otherwise

encumbered

Total

No. of

Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Total

No. of

Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Total No.

of Shares

No. of

Equity

Shares in

demateriali

sed form

Total

Shareholding as a

% of total No. of

Shares

Numb

er of

shares

As a

% of

Total

No.

of

Shar

es As a

% of

(A+

B)

As a %

of

(A+B+

C)

As a

% of

(A+

B)

As a %

of

(A+B+

C)

As a

% of

(A+B

)

As a %

of

(A+B+

C)

84 00 3(3)

0

(C) Shares

held by

Custodians

and against

which

Depository

Receipts have

been issued

Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil

Total

(A)+(B)+(C)

7 62,957,1

84

Nil 100 100 90,834,2

00

Nil 100 100 129,763,14

3 (3)

100.0

0

100.00

* The shareholding of the Promoter Group includes 4,763,748 Equity Shares held by Kalani Holdings Private Limited (a wholly owned

subsidiary of PML) which is a promoter group company in accordance with Regulation 2(zb)(iii)(C) of the SEBI Regulations. None of the Promoters of the Company hold any shares or have any interest in Kalani Holdings Private Limited (a wholly owned subsidiary of PML).

(1) Pursuant to a securities subscription and shareholders’ agreement dated November 1, 2006 between the Company, IAF - III, Promoters

and Ashok Ruia Enterprises Private Limited (merged with PML) (“Agreement”), the Company has issued and allotted 7,500,000 optionally

convertible debentures of Rs. 100 each (“OCDs”) to IAF - III which will convert into 27,877,016 Equity Shares at a conversion price to be

determined in accordance with the terms of the Agreement, prior to the filing of the Red Herring Prospectus with the RoC. Of, 27,877,016, Equity Shares that will be allotted to IAF - III, 11,463,276 Equity Shares aggregating to 8.83% of the post-Issue paid-up capital of the

Company will be held in an escrow account with an escrow agent in accordance with the terms of the Agreement(“Escrow Equity Shares”).

The Escrow Equity Shares shall be released from the escrow account proportionately to the Promoters and IAF - III depending on the value realised on sale of balance Equity Shares by IAF - III and the return on investment computed as per a prescribed multiple of cost or IRR

structure, whichever is higher, as specified under the Agreement, after the mandatory lock-in period of one year from the date of allotment of Equity Shares in the Issue. The Promoters and IAF - III will enter into an escrow Agreement with an escrow agent prior to the

conversion of OCDs into Equity Shares and filing of the Red Herring Prospectus with the RoC. The details of the conversion price and the

escrow agreement will be updated in the Red Herring Prospectus prior to filing with the RoC. For further details in relation to the Agreement, see “History and Certain Corporate Matters - Shareholder Agreements/ Other Key Agreements” on page 110 of this Draft Red

Herring Prospectus.

(2) PHPL and KBIPL have agreed to transfer 1,488,689 Equity Shares and 3,129,657 Equity Shares, respectively, to PML prior to the filing

of the Red Herring Prospectus with the RoC, in terms of a letter dated June 18, 2010, such that post conversion of the OCDs (prior to filing

of the Red Herring Prospectus with the RoC) held by IAF - III into the Equity Shares of the Company and prior to the Issue, KHPL (a wholly owned subsidiary of PML) and PML together hold an aggregate of 33% of the pre-Issue equity share capital of the Company. The

details of this transfer will be updated prior to filing the Red Herring Prospectus with the RoC. Additionally, a deed of adherence and

modification to the securities subscription and shareholders agreement was executed on July 9, 2010 pursuant to which PML and KHPL has agreed to transfer the Promoter Sale Shares (as defined below) back to the Promoters on default of certain obligations as provided

under the said securities subscription and shareholders agreement. For further details, see “History and Certain Corporate Matters -

Shareholder Agreements/ Other Key Agreements”on page 110 of this Draft Red Herring Prospectus.

(3) This includes 38,928,943 Equity Shares which are proposed to be issued and allotted in the Issue, which constitutes 30% of the post- Issue

paid up capital of the Company. The number of shareholders in the public category after the Issue cannot be ascertained as of the date of

the Draft Red Herring Prospectus.

4. The list of top shareholders of the Company and the number of Equity Shares held by them is as under:

(a) As on the date of this Draft Red Herring Prospectus:

S.

No.

Name of the Shareholder No. of Equity Shares held Percentage

1. Manish Kalani 400 0.00

2. B. Rajesh Nair 40 0.00

3. KBIPL 25,405,004 40.35

4. PHPL 11,998,800 19.06

5. PML 20,593,192 32.71

6. KHPL (a wholly owned subsidiary of

PML)

4,763,748 7.57

7. IAF - III 196,000 0.31

Total 62,957,184 100.00

35

(b) As of 10 days prior to the date of this Draft Red Herring Prospectus:

S.

No.



2. B. Rajesh Nair 40 0.00

3. KBIPL 25,405,004 40.35

4. PHPL 11,998,800 19.06

5. PML 20,593,192 32.71


PML)

4,763,748 7.57

7. IAF - III 196,000 0.31

Total 62,957,184 100.00

(c) As of two years prior to the date of this Draft Red Herring Prospectus:

S.

No.



2. KBIPL 6,351,261 40.35

3. PHPL 2,999,700 19.06

4. PML 5,148,298 32.71


PML)

1,190,937 7.57

6. IAF - III 49,000 0.31

Total 15,739,296 100.00

5. The Company, the Directors or the BRLMs have not entered into any buy-back arrangements for the

purchase of Equity Shares from any person.

6. Except as stated in section “Management - Shareholding of Directors” on page 119 of this Draft Red

Herring Prospectus, none of the Directors or key management personnel hold any Equity Shares in the

Company. None of the directors of the Promoters hold any Equity Shares in the Company, except for B.

Rajesh Nair who holds 40 Equity Shares in the Company.

7. Pursuant to a securities subscription and shareholders‟ agreement dated November 1, 2006 between the

Company, IAF - III, Promoters and Ashok Ruia Enterprises Private Limited (merged with PML)

(“Agreement”), the Company has issued and allotted 7,500,000 optionally convertible debentures of Rs.

100 each (“OCDs”) to IAF - III which will convert into 27,877,016 Equity Shares at a conversion price to

be determined in accordance with the terms of the Agreement, prior to the filing of the Red Herring

Prospectus with the RoC. Of, 27,877,016, Equity Shares that will be allotted to IAF - III, 11,463,276 Equity

Shares aggregating to 8.83% of the post-Issue paid-up capital of the Company will be held in an escrow

account with an escrow agent in accordance with the terms of the Agreement (“Escrow Equity Shares”).

The Escrow Equity Shares shall be released from the escrow account proportionately to the Promoters and

IAF - III depending on the value realised on sale of balance Equity Shares by IAF - III and the return on

investment computed as per a prescribed multiple of cost or IRR structure, whichever is higher, as specified

under the Agreement, after the mandatory lock-in period of one year from the date of allotment of Equity

Shares in the Issue. The Promoters and IAF - III will enter into an escrow Agreement with an escrow agent

prior to the conversion of OCDs into Equity Shares and filing of the Red Herring Prospectus with the RoC.

The details of the conversion price and the escrow agreement will be updated in the Red Herring

Prospectus prior to filing with the RoC. For further details in relation to the Agreement, see “History and

Certain Corporate Matters - Shareholder Agreements/ Other Key Agreements” on page 110 of this Draft

Red Herring Prospectus. Except as mentioned above, there are no outstanding convertible securities or any

other rights which would entitle any person any option to acquire the Equity Shares after the Issue.

36

8. PHPL and KBIPL have agreed to transfer 1,488,689 Equity Shares and 3,129,657 Equity Shares,

respectively, to PML prior to the filing of the Red Herring Prospectus with the RoC, in terms of a letter

dated June 18, 2010, such that post conversion of the OCDs (prior to filing of the Red Herring Prospectus

with the RoC) held by IAF - III into the Equity Shares of the Company and prior to the Issue, KHPL (a

wholly owned subsidiary of PML) and PML together hold an aggregate of 33% of the pre-Issue equity

share capital of the Company. The details of this transfer will be updated prior to filing the Red Herring

Prospectus with the RoC. Additionally, a deed of adherence and modification to the securities subscription

and shareholders agreement was executed on July 9, 2010 pursuant to which PML and KHPL has agreed to

transfer the Promoter Sale Shares (as defined below) back to the Promoters on default of certain obligations

as provided under the said securities subscription and shareholders agreement. For further details, see

“History and Certain Corporate Matters - Shareholder Agreements/ Other Key Agreements”on page 110 of

this Draft Red Herring Prospectus.

9. Subject to the conversion of 7,500,000 OCDs held by IAF - III into 27,877,016 Equity Shares prior to filing

of the Red Herring Prospectus with the RoC, there will be no further issue of Equity Shares, whether by

way of issue of bonus shares, preferential allotment, rights issue or in any other manner during the period

commencing from submission of this Draft Red Herring Prospectus with SEBI until the Equity Shares have

been listed.

10. An oversubscription to the extent of 10% of the Issue can be retained for the purposes of rounding off to

the nearer multiple of minimum allotment lot.

11. The Promoters, Promoter Group, the directors of the Promoters, the Directors and their immediate relatives

have not purchased or sold any Equity Shares within six months preceding the date of filing this Draft Red

Herring Prospectus with SEBI, except for B. Rajesh Nair who purchased 10 Equity Shares from KBIPL on

January 21, 2010 at Rs. 10 per Equity Share.

12. None of the Promoters, Promoter Group and Group Companies will participate in the Issue.

13. Neither the BRLMs nor their Associates hold any Equity Shares in the Company.

14. There shall be only one denomination of Equity Shares, unless otherwise permitted by law. We shall

comply with such disclosure and accounting norms as may be specified by SEBI from time to time.

15. The Equity Shares will be fully paid up at the time of Allotment failing which no Allotment shall be made.

16. As of the date of filing of this Draft Red Herring Prospectus, the total number of holders of Equity Shares is

seven.

17. No person connected with the Issue shall offer any incentive, direct or indirect, in any manner, whether in

cash, kind, services or otherwise, to any Bidder.

18. The Company has not issued any Equity Shares under any employee stock option scheme or employee

stock purchase scheme.

19. At least 50% of the Issue shall be allocated to QIBs on a proportionate basis. 5% of the QIB Portion

(excluding Anchor Investor Portion) shall be available for allocation to Mutual Funds only and the

remaining QIB Portion shall be available for allocation to the QIB Bidders including Mutual Funds subject

to valid Bids being received at or above the Issue Price. Further, not less than 15% of the Issue will be

available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the

Issue will be available for allocation to Retail Individual Bidders, subject to valid Bids being received from

them at or above the Issue Price. Under-subscription, if any, in the Non-Institutional and Retail Individual

categories would be allowed to be met with spill over from any other category at the discretion of the

Company in consulation with the BRLMs and the Designated Stock Exchange.

37

20. Under-subscription, if any, in any category, except the QIB Portion, would be allowed to be met with spill-

over from any other category or combination of categories at the discretion of the Company in consultation

with the BRLMs and the Designated Stock Exchange. For further details, see “Issue Structure” on page 328

of this Draft Red Herring Prospectus.

21. Other than the bonus issue on June 11, 2010, the Company has not issued any Equity Shares during a

period of one year preceding the date of this Draft Red Herring Prospectus at a price lower than the Issue

Price.

22. The Company presently does not intend or propose to alter the capital structure for a period of six months

from the Bid/Issue Opening Date, by way of split or consolidation of the denomination of Equity Shares or

further issue of Equity Shares (including issue of securities convertible into or exchangeable, directly or

indirectly for Equity Shares) whether on a preferential basis or issue of bonus or rights or further public

issue of specified securities or qualified institutions placement or otherwise. Also, if the Company enters

into acquisitions, joint ventures or other arrangements, the Company may, subject to necessary approvals,

consider raising additional capital to fund such activity or use Equity Shares as currency for acquisitions or

participation in such joint ventures.

23. There has been no financing arrangement whereby the Promoter Group, the directors of the Promoter, the

Directors and their respective relatives have financed the purchase by any other person of Equity Shares or

securities of the Company other than in normal course of the business of the financing entity during the

period of six months immediately preceding the date of filing of the Draft Red Herring Prospectus.

38

OBJECTS OF THE ISSUE

The proceeds of the Issue, after deducting the Issue related expenses (the “Net Proceeds”), are estimated to be

approximately Rs. [●] million.

The Net Proceeds are proposed to be utilised by the Company for the following objects:

(a) Construction of certain Ongoing Projects;

(b) Purchase of a portion of unsecured fully convertible debentures issued by TWDPL from IAF - III, IAF - IV

and PML; and

(c) General corporate purposes.

The main objects clause of the Memorandum of Association enables the Company to undertake the existing

activities and the activities for which the funds are being raised through this Issue.

The details of the proceeds of the Issue are summarised in the table below:

(In Rs. Million)

Amount

Gross Proceeds from the Issue [●]

Issue related Expenses [●]

Net Proceeds* [●] * To be finalised upon determination of the Issue Price

Any expenditure incurred towards the objects mentioned in this section will be recouped from the Net Proceeds of

the Issue.

Utilisation of Net Proceeds

The intended utilisation of the Net Proceeds is summarised in the table below:

(In Rs. million)

Particulars Amount

Construction of certain Ongoing Projects 875.01

Purchase of a portion of unsecured fully convertible debentures issued by

TWDPL from IAF - III, IAF - IV and PML

1,250.00

General corporate purposes(1)

[●]

Total Net Proceeds [●] (1) The amount to be deployed towards general corporate purposes will be decided after finalisation of Issue Price

Deployment of Net Proceeds of the Issue

The Net Proceeds of the Issue are currently expected to be deployed in accordance with the schedule set forth below:

(In Rs. million)

Project/ Activity Fiscal 2011 Fiscal 2012 Fiscal 2013 Total

Construction of certain Ongoing Projects 875.01 - - 875.01

Purchase of a portion of unsecured fully

convertible debentures of TWDPL from

IAF - III and IAF - IV and PML

1,250.00 - - 1,250.00

General corporate purposes(1)

[●] [●] [●] [●]

Total [●] [●] [●] [●] (1) The amount to be deployed towards general corporate purposes will be decided after finalisation of the Issue Price

39

Our management, in accordance with the policies set up by our Board, will have flexibility in deploying the Net

Proceeds, as well as the discretion to revise its business plan from time to time and consequently the funding

requirement and deployment of funds may also change. This may include rescheduling the proposed utilisation of

Net Proceeds and increasing or decreasing expenditure for a particular object vis-à-vis the utilisation of Net

Proceeds. In the event of significant variations in the proposed utilisation, approval of our shareholders shall be duly

sought. In case of variations in the actual utilisation of funds earmarked for the purposes set forth above, increased

fund requirements for a particular purpose may be financed by surplus funds, if any, available in respect of the other

purposes for which funds are being raised in this Issue, including the funds available for general corporate purposes.

If such surplus funds are unavailable, the required financing will be met through internal accruals and debt. We

believe that such alternative arrangements would be available to fund any such shortfall. In the event any surplus

funds remain from the Net Proceeds of the Issue after meeting all the aforesaid objectives, such surplus proceeds

will be used for general corporate purposes including for meeting future growth opportunities.

Details of the Objects of the Issue

1. Construction of Certain Ongoing projects

The Company proposes to deploy a portion of the Net Proceeds of the Issue towards construction and

development costs of the following Ongoing Projects:

(a) Treasure Market City, Indore (Phase I) being developed by Indore Treasure Market City Private

Limited;

(b) Treasure Island, Raipur being developed by Raipur Treasure Island Private Limited; and

(c) Treasure Island, Jabalpur being developed by Jabalpur Treasure Island Private Limited.

For further details on the projects mentioned above, see “Business” on page 76 of this Draft Red Herring

Prospectus.

The details of the projects, including the utilisation of the Net Proceeds of the Issue, are as follows:

S.

No.

Project

Name

Estimated

Gross

Leaseable/

Saleable

Area* (in

Sq. ft.)

Project

commencement

date

Estimated

completion

date

Total

estimated

project

cost

(including

land cost)

(In Rs.

million)##

Amount

deployed

as at

May 31,

2010#

(In Rs.

million)

Amount

proposed to

be utilised

from the Net

Proceeds of

the Issue

(In Rs.

million)

Proposed to be

funded by

internal

accruals (In Rs.

million)

Sanctioned

Debt available

to be drawn

down by the

Company (as at

May 31, 2010)

(In Rs. million)

1. Treasure

Market

City, Indore

(Phase I)

970,075 February 2008 June 2011 3,415.00 1,793.55 189.34 446.82 867.29

2. Treasure

Island,

Raipur

828,343 September 2007 March 2011 2,227.00 1,379.66 507.63 16.37 243.93

3. Treasure

Island,

Jabalpur

464,889 August 2007 March 2011 1,365.00 849.25 178.04 5.06 290.00

Total Costs 7,007.00 4022.46 875.01 468.25 1401.22 * As per certificate dated May 31, 2010 issued by P.G. Patki Architects and Sanjay Puri Architects. # As per certificate dated June 9, 2010 by R.L. Porwal & Co., Chartered Accountants. ## These are based on management estimates as per the certificate dated June 30, 2010. However, estimated civil construction costs excluding

mechanical, electrical and plumbing costs for each of the projects have also been certified by P.G. Patki Architects and Sanjay Puri Architects pursuant to their certificates dated May 31, 2010.

40

1. Treasure Market City, Indore (Phase I)

Break up of costs

The details of the break-up of the cost for Treasure Market City, Indore (Phase I) are set forth below:

(In Rs. million)

S.

No.

Particulars Total estimated

project cost

Amount deployed as

at May 31, 2010#

1. Land costs 134.52 134.52

2. Civil construction costs including mechanical,

electrical and plumbing costs

2,916.75 1,429.52

3. Pre-operative costs including finance costs,

selling, marketing, brokerage, administration and

other miscellaneous costs

363.73 229.51

Total 3,415.00 1,793.55 # As per certificate dated June 9, 2010 by R.L. Porwal & Co., Chartered Accountants.

Means of Finance

The details of our means of finance for Treasure Market City, Indore (Phase I) is set forth below:

(In Rs. million)

Particulars Amount

Total cost 3,415.00

(Less) Amounts deployed as of May 31, 2010# 1,793.55

(Less) Proposed funding through internal accruals 446.82 (Less) Expected funding from Net Proceeds of the Issue 189.34 Balance funds required 985.29 75% firm tie-up required in-terms of Regulation 4(g) of the SEBI Regulations 738.97 Sanctioned debt available to be drawn down by the Company (as at May 31, 2010) 867.29

##

# As per certificate dated June 9, 2010 by R.L. Porwal & Co., Chartered Accountants. ## UCO Bank and LIC Housing Finance Limited have granted a loan of Rs. 1,250 million pursuant to a joint deed of agreement for

term loan dated February 25, 2010. Further, State Bank of Indore has granted a loan of Rs. 400 million pursuant to a sanction letter

dated March 31, 2010.

Indore Treasure Market City Private Limited has sufficient cash and bank balance to finance the balance

funds required for construction and development of Treasure Market City Indore, (Phase I).

2. Treasure Island, Raipur

Break up of costs

The details of the break-up of the cost for Treasure Island, Raipur are set forth below:

(In Rs. million)

S.

No.


project cost

Amount deployed as at May

31, 2010#

1. Land costs 170.70 170.70 2. Civil construction costs including

mechanical, electrical and plumbing costs 1,669.19 914.03

3. Pre-operative cost including selling,

marketing, brokerage, administration and


387.11 294.93

Total 2,227.00 1,379.66 # As per certificate dated June 9, 2010 by R.L. Porwal & Co., Chartered Accountants.

41

Means of Finance

The details of our means of finance for Treasure Island, Raipur is set forth below:

(In Rs. million)

Particulars Amount

Total cost 2,227.00

(Less) Amounts deployed as of May 31, 2010# 1,379.66


##

# As per certificate dated June 9, 2010 by R.L. Porwal & Co., Chartered Accountants. ## Housing and Urban Development Corporation Limited has granted a loan of Rs. 900 million pursuant to a loan agreement dated

March 31, 2007.

Raipur Treasure Island Private Limited has sufficient cash and bank balance to finance the balance funds

required for construction and development of Treasure Island, Raipur.

3. Treasure Island, Jabalpur

Break up of costs

The details of the break-up of the cost for Treasure Island, Jabalpur are set forth below:

(In Rs. million)

S.

No.


project cost

Amount deployed as at May

31, 2010#

1. Land costs 125.47 125.47

2. Civil construction costs including

mechanical, electrical and plumbing costs 1,008.23 563.76

3. Pre-operative cost including selling,

marketing, brokerage, administration and


231.30 160.02

Total 1,365.00 849.25 # As per certificate dated June 9, 2010 by R.L. Porwal & Co., Chartered Accountants.

Means of Finance

The details of our means of finance for Treasure Island, Jabalpur is set forth below:

(In Rs. million)

Particulars Amount

Total cost 1,365.00

(Less) Amounts deployed as of May 31, 2010# 849.25


##

# As per certificate dated June 9, 2010 by R.L. Porwal & Co., Chartered Accountants. ## Housing and Urban Development Corporation Limited has granted a loan of Rs. 660 million pursuant to a loan agreement dated

December 14, 2007.

Jabalpur Treasure Island Private Limited has sufficient cash and bank balance to finance the balance funds

required for construction and development of Treasure Island, Jabalpur.

The Company shall be deploying the Net Proceeds in the project specific SPVs implementing the above

mentioned projects in the form of debt or equity.

42

2. Purchase of a portion of unsecured fully convertible debentures issued by TWDPL from IAF - III,

IAF - IV and PML

The Company proposes to utilise a portion of the Net Proceeds of the Issue aggregating to Rs. 750 million

to purchase a portion of unsecured fully convertible debentures (“Convertible Debentures”) of TWDPL, a

subsidiary of the Company, from IAF - III and IAF - IV which are venture capital funds registered with

SEBI and managed by ICICI Venture Funds Management Company Limited or any other holders of the

Convertible Debentures, if the Convertible Debentures are transferred by IAF - III and IAF - IV in

accordance with the a share and debenture subscription agreement dated November 15, 2007

(“Agreement”). IAF - III and IAF - IV subscribed to 149,999,150 Convertible Debentures of face value Rs.

10 each and 10 equity shares of face value Rs. 10 each, at a price of Rs. 850 per equity share aggregating to

Rs. 1,500 million through the Agreement. The Convertible Debentures are convertible into the Equity

Shares of TWDPL inter alia (i) after the the maturity date, which is the date falling on the expiry of four

years and 90 days from the date of issue of the Convertible Debentures or (ii) prior to the initial public

offering of TWDPL in the event that TWDPL proposes to undertake an initial public offering. The

Convertible Debentures will yield a maturity interest at the rate of 5% per annum compounded semi

annually to be paid by TWDPL in cash and the balance amount of 15% per annum may be paid by

TWDPL, totalling to an IRR of 20% per annum, which shall accrue and be converted into Equity Shares of

TWDPL in accordance with the Investor Agreement. Until conversion, TWDPL has an option of paying an

additional coupon over and above the 5% interest to be paid in cash as mentioned above and such

additional amount shall not exceed 8% compounded semi annually. For further details of the share and

debenture subscription agreement, see “Subsidiaries and Joint Venture - Treasure World Developers

Private Limited - Corporate Information” on page 129 of this Draft Red Herring Prospectus.

The Company also proposes to utilise a portion of the Net Proceeds of the Issue aggregating to Rs. 500

million to purchase a portion of Convertible Debentures of TWDPL from PML. PML subscribed to

100,000,000 Convertible Debentures of face value Rs. 10 each aggregating to Rs. 1,000 million through a

share and debenture subscription agreement dated October 10, 2008. The Convertible Debentures are

convertible into the Equity Shares of TWDPL inter alia (i) after the maturity date, which is the date falling

on the expiry of four years and 90 days from the date of issue of the Convertible Debentures or (ii) prior to

the initial public offering of TWDPL in the event that TWDPL proposes to undertake an initial public

offering. For further details of the share and debenture subscription agreement, see “Subsidiaries and Joint

Venture - Treasure World Developers Private Limited - Corporate Information” on page 129 of this Draft


IAF - III, IAF - IV and PML have not converted any Convertible Debentures held by them into equity

shares of TWDPL as on date of this Draft Red Herring Prospectus. The details of the proposed purchase of

a portion of Convertible Debentures of TWDPL by the Company from the Net Proceeds of the Issue are set

forth in the table below:

Investor Date of

Agreement

Amount Invested in

Convertible

Debentures as at

March 31, 2010(In Rs.

million)

Amount Proposed to be utilised

by the Company to purchase a

portion of Convertible

Debentures from the Net

Proceeds of the Issue (In Rs.

million)

IAF - III and IAF - IV

managed by ICICI

Venture Funds

Management Company

Limited

November

15, 2007

1,500 750

PML October 10,

2008

1,000 500

Total 2,500 1,250

43

3. General Corporate Purposes

The Net Proceeds of the Issue will be first utilised towards the aforesaid items and the balance is proposed

to be utilised for general corporate purposes including but not restricted to strategic initiatives,

partnerships, joint ventures and acquisitions, meeting exigencies, which the Company in the ordinary

course of business may face, or any other purposes as approved by the Board.

Issue Expenses

The estimated Issue related expenses are as follows:

(In Rs. million)

Particulars Amounts* As % of total

expenses

As a

percentage of

Issue Size

Lead merchant bankers (including, underwriting

commission, brokerage and selling commission)

[●] [●] [●]

Registrars to the Issue [●] [●] [●]

Advisors [●] [●] [●]

Bankers to the Issue [●] [●] [●]

Others:

- Printing and stationery [●] [●] [●]

- Listing fees [●] [●] [●]

- Advertising and marketing expenses [●] [●] [●]

- IPO Grading fees [●] [●] [●]

- Others [●] [●] [●]

Total Estimated Issue Expenses [●] [●] [●] *Will be incorporated after finalisation of Issue Price

Bridge Financing Facilities

The Company has not raised any bridge loans from any bank or financial institution as on the date of this

Draft Red Herring Prospectus.

Interim use of Net Proceeds of the Issue

The Company, in accordance with the policies formulated by its Board from time to time, will have

flexibility in deploying the Net Proceeds received from the Issue. The particular composition, timing and

schedule of deployment of the Net Proceeds of the Issue will be determined by the Company based on the

development of the projects. Pending utilisation of the Net Proceeds of the Issue for the purposes described

above, the Company intends to temporarily invest the funds in interest bearing liquid instruments including

deposits with banks and investments in money market mutual funds and other financial products and

investment grade interest bearing securities as may be approved by the Board.

Monitoring of Utilisation of Funds

There is no requirement for a monitoring agency as the Issue size is less than Rs. 5,000 million. The Board

shall monitor the utilisation of the proceeds of the Issue. The Company will disclose the utilisation of the

proceeds of the Issue under a separate head along with details, if any in relation to all such proceeds of the

Issue that have not been utilised thereby also indicating investments, if any, of such unutilised proceeds of

the Issue in the balance sheet of the Company for the relevant financial years commencing from Fiscal

2011.

Pursuant to clause 49 of the Listing Agreement, the Company shall, on a quarterly basis, disclose to its

Audit Committee the uses and applications of the proceeds of the Issue. On an annual basis, the Company

44

shall prepare a statement of funds utilised for purposes other than those stated in this Draft Red Herring

Prospectus and place it before the Audit Committee. Such disclosure shall be made only until such time

that all the proceeds of the Issue have been utilised in full. The statement shall be certified by the statutory

auditors of the Company. Furthermore, in accordance with clause 43A of the Listing Agreement, the

Company shall furnish to the Stock Exchanges on a quarterly basis, a statement including material

deviations if any, in the utilisation of the process of the Issue from the objects of the Issue as stated above.

This information will also be published in newspapers simultaneously with the interim or annual financial

results, after placing the same before the Audit Committee.

No part of the Issue proceeds will be paid by the Company as consideration to Promoters, the Directors, the

Company‟s key management personnel or the Group Companies, except in the ordinary course of business.

45

BASIS FOR ISSUE PRICE

The Issue Price of Rs. [●] has been determined by the Company in consultation with the BRLMs, on the basis of

assessment of market demand from the investors for the offered Equity Shares by way of Book Building process.

The face value of the equity shares is Rs 10 and the Issue price is [●] times the face value at the lower end of the

Price Band and [●] times the face value at the higher end of the Price Band. Investors should also refer to “Risk

Factors” and “Financial Statements” on pages xi and 162 of this Draft Red Herring Prospectus. The financial data

presented in this section are based on the Company‟s financial statements, as restated.

QUALITATIVE FACTORS







For more details on qualitative factors, refer to “Business” on page 76 of this Draft Red Herring Prospectus.

QUANTITATIVE FACTORS

Information presented in this section is derived from our Unconsolidated and Consolidated Restated Financial

Statements prepared in accordance with Indian GAAP. For more details, refer to “Financial Statements” on page


Some of the quantitative factors which may form the basis for computing the Issue Price are as follows:

1. EARNING PER SHARE (EPS):

As per our Restated Unconsolidated Summary Statements:

Year ended Basic EPS (in Rs.) Diluted EPS (in Rs.) Weight

March 31, 2010 0.23 0.16 3

March 31, 2009 0.29 0.20 2

March 31, 2008 0.48 0.36 1

Weighted Average 0.29 0.21

As per our Restated Consolidated Summary Statements:

Year ended Basic EPS (in Rs.) Diluted EPS (in Rs.) Weight

March 31, 2010 2.00 1.38 3

March 31, 2009 (2.05) (2.05) 2

March 31, 2008 (0.32) (0.32) 1

Weighted Average 0.26 (0.05)

Note:

a) The Earning per Share has been computed on the basis of the restated profits and losses of the

respective years.

b) EPS calculations have been done in accordance with Accounting Standard 20-“Earning per share”

issued by the Institute of Chartered Accountants of India.

c) The allocation of bonus shares issued pursuant to the board meeting on May 12, 2010 and the

same have been taken into account while computing the EPS.

46

2. PRICE EARNING RATIO (P/E RATIO)

Price/Earning (P/E) ratio in relation to Issue Price of Rs. [●] per share of face value of Rs. 10 each:

a) As per our Restated Unconsolidated Summary Statements for year ended March 31, 2010:

i. For Basic EPS: Rs. [●]

ii. For Diluted EPS: Rs. [●]

b) As per our Restated Consolidated Summary Statements for year ended March 31, 2010:

i. For Basic EPS: Rs. [●]

ii. For Diluted EPS: Rs. [●]

c) Industry P/E* –

a. Highest: 163.0

b. Lowest: 4.7

c. Industry Composite: 31.6

* Source: “Capital Market” magazine Vol. no. XXV/06 dated May 17 - May 30, 2010 (Industry – Construction Sector)

3. RETURN ON NET WORTH:

Return on Net Worth as Per Restated Unconsolidated Financial Statements

Year Ended RONW (%) Weight

March 31, 2010 1.67% 3

March 31, 2009 1.88% 2

March 31, 2008 1.73% 1

Weighted Average 1.75%

Return on Net Worth as Per Restated Consolidated Financial Statements

Year Ended RONW (%) Weight

March 31, 2010 3.55% 3

March 31, 2009 (4.48%) 2

March 31, 2008 (0.91%) 1

Weighted Average 0.13%

4. Minimum return on Increased Net Worth after the Issue required to maintain pre-issue EPS for the

year ended March 31, 2009:

a. Based on Restated Unconsolidated Financial Statements:

i. At the Floor Price - [●]

ii. At the Cap Price - [●]

b. Based on Restated Consolidated Financial Statements:

i. At the Floor Price - [●]

ii. At the Cap Price - [●]

47

5. NET ASSET VALUE PER EQUITY SHARE:

a. As of March 31, 2010 (Consolidated): Rs. 38.97

b. As of March 31, 2010 (Unconsolidated): Rs. 14.05

c. Issue Price [●]*

d. As of March 31, 2010 (Consolidated) after the Issue: Rs. [●]

e. As of March 31, 2010 (Unconsolidated) after the Issue: Rs. [●]

*Issue Price per Equity Share will be determined on conclusion of book building process.

Net Asset Value per Equity Share represents Net Worth, as restated, divided by the number of Equity

Shares outstanding at the end of the period.

6. COMPARISON WITH INDUSTRY PEERS:

S.No Name of the company

Face

Value (Rs.

per Share)

Basic

EPS (Rs.)

P/E Ratio RoNW

(%)

NAV (Rs.)

1 PML 2 4.1 51.2 3.6 105.8

2 Brigade Enterprises 10 4.1 34.5 8.6 91.3

3 Omaxe 10 4.5 - 6.3 74.7

4 Sobha Developers 10 13.9 20.9 10.3 174.2

5 Entertainment World

Developers Limited ##

10 0.23 [●] 1.67 14.05

Source: “Capital Market” magazine Vol. no. XXV/06 dated May 17 - May 30, 2010 (Industry –

Construction Sector- Based on the standalone audited financial statements.)

## Based on the Restated Unconsolidated Financial Statements for the year ended March 31, 2010

Since the Issue is being made through the 100% Book Building Process, the Issue Price will be determined on the

basis of investor demand.

The face value of our Equity Shares is Rs.10 each and the Issue Price is [●] times of the face value of our Equity

Shares.

The Issue Price of Rs. [●] has been determined by us, in consultation with the BRLMs on the basis of the demand

from investors for the Equity Shares through the Book-Building Process and is justified based on the above

quantitative and qualitative factors. For further details, see “Risk Factors” on page xi of this Draft Red Herring

Prospectus and the financials of the Company including important profitability and return ratios, as set out in

“Financial Statements” on page 162 of this Draft Red Herring Prospectus to have a more informed view. The trading

price of the Equity shares of the company could decline due to the factors mentioned in “Risk Factors” and you may

lose all or part of your investments.

48

STATEMENT OF TAX BENEFITS

9 June 2010

Entertainment World Developers Ltd.

G-16, R.R. Hosirey Building,

Shri Laxmi Woolen Mills Estate,

Dr.E.Moses Road,

Mahalaxmi

Mumbai – 400 011

Dear Sir,

Re: Statement of Possible Direct Tax Benefits

We hereby submit that the enclosed annexure states the possible tax benefits available to Entertainment World

Developers Ltd. (“Company”) and its shareholders under the current tax laws in India. Several of these benefits are

dependent on the Company or its shareholders fulfilling the conditions prescribed under the relevant tax laws.

Hence, the ability of the Company or its shareholders to derive the tax benefits is dependent upon fulfilling such

conditions, which based on business imperatives the Company faces in the future, the Company may or may not

choose to fulfill.

The benefits discussed in the attached annexure are not exhaustive. This statement is only intended to provide

general information to the investors and is neither designed nor intended to be a substitute for professional tax

advice. In view of the individual nature of the tax consequences and the changing tax laws, each investor is advised

to consult his or her own tax consultant with respect to the specific tax implications arising out of their participation

in the issue particularly in view of the fact that certain recently enacted legislation may not have a direct legal

precedent or may have a different interpretation on the benefits, which an investor can avail.

We do not express any opinion or provide any assurance whether:

the Company or its shareholders will continue to obtain these benefits in future; or

the conditions prescribed for availing the benefits have been or would be met with.

The contents of this annexure are based on information, explanations and representations obtained from the

Company and on the basis of our understanding of the business activities and operations of the Company.

49

ANNEXURE

STATEMENT OF POSSIBLE DIRECT TAX BENEFITS AVAILABLE TO ENTERTAINMENT WORLD

DEVELOPERS LTD. (“COMPANY”) AND TO ITS SHAREHOLDERS

A. Under the Income Tax Act, 1961 (“the Act”)

I. Special tax benefits available to the company

There are no special tax benefits available under the Act to the Company.

II. General tax benefits available to the company

1. As per section 10(34) of the Act, any income by way of dividends referred to in section 115-O received on

the shares of any Indian company is exempt from tax. However, as per section 94(7) of the Act, losses

arising from sale / transfer of shares, where such shares are purchased within three months prior to the

record date and sold within three months from the record date, will be disallowed to the extent such loss

does not exceed the amount of dividend claimed exempt.

2. As per section 10(35) of the Act, the following income will be exempt in the hands of the Company:

a. Income received in respect of the units of a Mutual Fund specified under clause (23D) of section

10; or

b. Income received in respect of units from the Administrator of the specified undertaking; or

c. Income received in respect of units from the specified company:

However, this exemption does not apply to any income arising from transfer of units of the Administrator

of the specified undertaking or of the specified Company or of a mutual fund, as the case may be.

For this purpose (i) “Administrator” means the Administrator as referred to in section 2(a) of the Unit Trust

of India (Transfer of Undertaking and Repeal) Act, 2002 and (ii) “Specified Company” means a Company

as referred to in section 2(h) of the said Act.

Further, as per section 94(7) of the Act, losses arising from the sale / redemption of units purchased within

three months prior to the record date (for entitlement to receive income) and sold within nine months from

the record date, will be disallowed to the extent such loss does not exceed the amount of income claimed

exempt.

As per section 94(8) of the Act, if an investor purchases units within three months prior to the record date

for entitlement of bonus, is allotted bonus units without any payment on the basis of holding original units

on the record date and such person sells / redeems the original units within nine months of the record date,

then the loss arising from sale/ redemption of the original units will be ignored for the purpose of

computing income chargeable to tax and the amount of loss ignored shall be regarded as the cost of

acquisition of the bonus units.

3. As per section 2(42A) of the Act, shares held in a company or any other security listed in a recognized

stock exchange in India or unit of the Unit Trust of India or a unit of a mutual fund specified under section

10(23D) or a zero coupon bonds will be considered as short term capital asset if the period of holding of

such security is 12 months or less. If the period of holding is more than 12 months, it will be considered as

long term capital assets. In respect of other assets the determinative period of holding is 36 months as

against 12 months mentioned above. Further, gain / loss arising from short term capital asset and long term

capital asset is regarded as short term capital gain and long term capital gain respectively.

50

4. As per section 10(38) of the Act, long term capital gains arising to the company from the transfer of long

term capital asset being an equity share in a company or a unit of an equity oriented fund where such

transaction has been entered into on a recognised stock exchange of India and is chargeable to securities

transaction tax will be exempt in the hands of the Company.

For this purpose, “Equity Oriented Fund” means a fund –

(i) where the investible funds are invested by way of equity shares in domestic companies to the

extent of more than sixty five percent of the total proceeds of such funds; and

(ii) which has been set up under a scheme of a Mutual Fund specified under section 10(23D) of the

Act.

As per section 115JB, while calculating “book profits” the Company will not be able to reduce the long

term capital gains to which the provisions of section 10(38) of the Act apply and will be required to pay

Minimum Alternate Tax @ 18% (plus applicable surcharge and education cess) of the book profits

including long term capital gains to which provisions of section 10(38) applies.

5. Section 14A of the Act restricts claim for deduction of expenses incurred in relation to incomes which do

not form part of the total income under the Act. Thus, any expenditure incurred to earn tax exempt income

is not tax deductible.

6. Under section 54EC of the Act and subject to the conditions and to the extent specified therein, long term

capital gain (in case not covered under section 10(38) of the Act) arising on the transfer of a Long Term

Capital Asset would be exempt from tax if such capital gain is invested within 6 months from the date of

such transfer in a “long term capital asset”. The investment in the long term specified assets is eligible for

such deduction to the extent of Rs.50,00,000 during any financial year. However, if the assessee transfers

or converts the long term specified asset into money within a period of three years from the date of its

acquisition, the amount of capital gains exempted earlier would become chargeable to tax as long-term

capital gains in the year in which the long term specified asset is transferred or converted into money.

A “long term specified asset” means any bond, redeemable after three years and issued on or after the 1st

day of April 2007:

(i) by the National Highways Authority of India constituted under section 3 of the National Highways

Authority of India Act, 1988; or

(ii) by the Rural Electrification Corporation Limited, a company formed and registered under the

Companies Act, 1956.

7. As per section 111A of the Act, short term capital gains arising to the Company from the sale of equity

share or a unit of an equity oriented fund, where such transaction is chargeable to securities transaction tax,

will be taxable at the rate of 15% (plus applicable surcharge and education cess). As per section 70 read

with section 74 of the Act, short-term capital loss, if any arising during the year can be set-off against short-

term capital gain as well as against the long-term capital gains and shall be allowed to be carried forward

upto eight assessment years immediately succeeding the assessment year for which the loss was first

computed.

8. As per section 112 of the Act, taxable long-term capital gains, on which securities transaction tax is not

paid, on sale of listed securities or units or zero coupon bonds will be charged to tax at the concessional rate

of 20% (plus applicable surcharge and education cess) after considering indexation benefits in accordance

with and subject to the provisions of section 48 of the Act or at 10% (plus applicable surcharge and

education cess) without indexation benefits, at the option of the Company. Under section 48 of the Act, the

long term capital gain arising out of the sale of capital asset will be computed after indexing the cost of

acquisition / improvement. As per section 70 read with section 74 of the Act, long-term capital loss, if any

51

arising during the year can be set-off only against long-term capital gain and shall be allowed to be carried

forward upto eight assessment years immediately succeeding the assessment year for which the loss was

first computed for set off against future long term capital gain.

9. As per the provisions of section 32(2) of the Act, where full effect cannot be given to the depreciation

allowance in any year, the same can be carried forward and claimed in the subsequent years as depreciation

of subsequent years. Further, as per the provisions of section 72 of the Act, unabsorbed business losses

which are not set off in any previous year can be carried forward upto eight assessment years immediately

succeeding the assessment year for which the loss was first computed and set off against the business

profits of the subsequent assessment years. However, the carry forward and set off of business losses is

subject to (i) the provisions of section 79 of the Act dealing with carry forward and set off of losses in case

of companies (not being companies in which public are substantially interested) in which change in

shareholding is more than 49% and (ii) section 80 of the Act dealing with submission of returns for losses.

10. As per section 115JAA(1A) of the Act, credit is allowed in respect of any Minimum Alternate Tax paid

under section 115JB of the Act for any assessment year commencing on or after 1st day of April 2006. Tax

credit to be allowed shall be the difference between Minimum Alternate Tax paid and the tax computed as

per the normal provisions of the Act for that assessment year. The Minimum Alternate Tax credit shall not

be allowed to be carried forward beyond tenth assessment year immediately succeeding the assessment

year in which tax credit become allowable.

III. General tax benefits available to Resident Shareholders






2. As per section 2(42A) of the Act, shares held in a company or any other security listed in a recognized

stock exchange in India or unit of the Unit Trust of India or a unit of a mutual fund specified under section

10(23D) or a zero coupon bonds will be considered as short term capital asset if the period of holding of

such security is 12 months or less. If the period of holding is more than 12 months, it will be considered as

long term capital assets. In respect of other assets the determinative period of holding is 36 months as

against 12 months mentioned above. Further, gain / loss arising from short term capital asset and long term

capital asset is regarded as short term capital gain and long term capital gain respectively.

3. As per section 10(38) of the Act, long term capital gains arising from the transfer of a long term capital

asset being an equity share of the Company, where such transaction has been entered into on a recognised

stock exchange of India and is chargeable to securities transaction tax, will be exempt in the hands of the

shareholder.

4. As per section 111A of the Act, short term capital gains arising from the sale of equity shares of the

Company, where such transaction is chargeable to securities transaction tax, will be taxable at the rate of

15% (plus applicable surcharge and education cess). As per section 70 read with section 74 of the Act,

short-term capital loss, if any arising during the year can be set-off against short-term capital gain as well as

against the long-term capital gains and shall be allowed to be carried forward upto eight assessment years

immediately succeeding the assessment year for which the loss was first computed.





capital gain (in case not covered under section 10(38) of the Act) arising on the transfer of shares of a

Company would be exempt from tax if such capital gain is invested within 6 months from the date of such

52

transfer in a “long term capital asset”. The investment in the long term specified assets is eligible for such

deduction to the extent of Rs.50,00,000 during any financial year. However, if the assessee transfers or

converts the long term specified asset into money within a period of three years from the date of its




day of April 2007:





7. As per section 54F of the Act, long term capital gains (in cases not covered under section 10(38)) arising on

the transfer of the shares of the Company held by an Individual or Hindu Undivided Family (HUF) will be

exempt from capital gains tax if the net consideration is utilized to purchase or construct a residential

house. The residential house is required to be purchased within a period of one year before or two years

after the date of transfer or to be constructed within three years after the date of transfer. Such benefit will

not be available:

(a) if the Individual or HUF -

owns more than one residential house, other than the new residential house, on the date of

transfer of the shares; or

purchases another residential house within a period of one year after the date of transfer

of the shares; or

constructs another residential house within a period of three years after the date of

transfer of the shares; and

(b) the income from such residential house, other than the one residential house owned on the date of

transfer of the original asset, is chargeable under the head “Income from house property”.

If only a part of the net consideration is so invested, so much of the capital gain as bears to the whole of the

capital gain the same proportion as the cost of the new residential house bears to the net consideration, will

be exempt.

If the new residential house is transferred within a period of three years from the date of purchase or

construction, the amount of capital gains on which tax was not charged earlier, will be deemed to be

income chargeable under the head “Capital Gains” of the year in which the residential house is transferred.

8. As per section 112 of the Act, taxable long-term capital gains, on which securities transaction tax is not

paid, on sale of listed securities will be charged to tax at the rate of 20% (plus applicable surcharge and

education cess) after considering indexation benefits or at 10% (plus applicable surcharge and education

cess) without indexation benefits, whichever is less. Under section 48 of the Act, the long term capital gain

arising out of the sale of capital asset will be computed after indexing the cost of acquisition /

improvement. As per section 70 read with section 74 of the Act, long-term capital loss, if any arising during

the year can be set-off only against long-term capital gain and shall be allowed to be carried forward upto

eight assessment years immediately succeeding the assessment year for which the loss was first computed

for set off against future long term capital gain.

53

9. As per section 36(1)(xv) of the Act, the securities transaction tax paid by the shareholder in respect of

taxable securities transactions entered in the course of the business will be eligible for deduction from the

income chargeable under the head “Profits and Gains of Business or Profession” if income arising from

taxable securities transaction is included in such income.

IV. General tax benefits available to Non-Resident Shareholders (Other than FIIs)






2. As per section 10(38) of the Act, long term capital gains arising from the transfer of long term capital asset

being an equity share of the Company, where such transaction has been entered into on a recognised stock

exchange of India and is chargeable to securities transaction tax, will be exempt in the hands of the

shareholder.

3. As per section 111A of the Act, short term capital gains arising from the sale of equity shares of the

Company, where such transaction is chargeable to securities transaction tax, will be taxable at the rate of

15% (plus applicable surcharge and education cess). As per section 70 read with section 74 of the Act,

short-term capital loss, if any arising during the year can be set-off against short-term capital gain as well as

against the long-term capital gains and shall be allowed to be carried forward upto eight assessment years

immediately succeeding the assessment year for which the loss was first computed.




5. As per first proviso to section 48 of the Act, in case of a non resident shareholder, the capital gain/loss

arising from transfer of shares of the Company, acquired in convertible foreign exchange, is to be

computed by converting the cost of acquisition, sales consideration and expenditure incurred wholly and

exclusively in connection with such transfer, into the same foreign currency which was initially utilized in

the purchase of shares. Cost Indexation benefit will not be available in such a case. As per section 112 of

the Act, taxable long-term capital gains, on which securities transaction tax is not paid, on sale of shares of

the company will be charged to tax at the rate of 20% (plus applicable surcharge and education cess). The

benefit of proviso to section 112(1) providing for tax rate of 10% on long-term capital gains without

indexation may be available to listed securities. As per section 70 read with section 74 of the Act, long-

term capital loss, if any arising during the year can be set-off only against long-term capital gain and shall

be allowed to be carried forward upto eight assessment years immediately succeeding the assessment year

for which the loss was first computed for set off against future long term capital gain.










day of April 2007:



54



7. As per section 54F of the Act, long term capital gains (in cases not covered under section 10(38)) arising on

the transfer of the shares of the Company held by an Individual or Hindu Undivided Family (HUF) will be

exempt from capital gains tax if the net consideration is utilized to purchase or construct a residential

house. The residential house is required to be purchased within a period of one year before or two years

after the date of transfer or to be constructed within three years after the date of transfer. Such benefit will

not be available:

(a) if the Individual or HUF -

owns more than one residential house, other than the new residential house, on the date of

transfer of the shares; or

purchases another residential house within a period of one year after the date of transfer

of the shares; or

constructs another residential house within a period of three years after the date of

transfer of the shares; and

(b) the income from such residential house, other than the one residential house owned on the date of

transfer of the original asset, is chargeable under the head “Income from house property”.

If only a part of the net consideration is so invested, so much of the capital gain as bears to the whole of the

capital gain the same proportion as the cost of the new residential house bears to the net consideration, will

be exempt.

If the new residential house is transferred within a period of three years from the date of purchase or

construction, the amount of capital gains on which tax was not charged earlier, will be deemed to be

income chargeable under the head “Capital Gains” of the year in which the residential house is transferred.

8. As per section 36(1)(xv) of the Act, the securities transaction tax paid by the shareholder in respect of

taxable securities transactions entered in the course of the business will be eligible for deduction from the

income chargeable under the head “Profits and Gains of Business or Profession” if income arising from

taxable securities transaction is included in such income.

9. In respect of non-residents, the tax rates and consequent taxation mentioned above will be further subject to

any benefits available under the Tax Treaty, if any, between India and the country in which the non-

resident is considered resident in terms of such Tax Treaty. As per the provisions of section 90(2) of the

Act, the provisions of the Act would prevail over the provisions of the Tax Treaty to the extent they are

more beneficial to the non-resident.

V. Special tax benefits available to Non-Resident Indians

1. As per section 115C(e) of the Act, the term “non-resident Indians” means an individual, being a citizen of

India or a person of Indian origin who is not a “resident”. A person shall be deemed to be of Indian origin if

he, or either of his parents or any of his grand-parents, was born in undivided India.

2. As per section 115E of the Act, in the case of a shareholder being a non-resident Indian, and subscribing to

the shares of the Company in convertible foreign exchange, in accordance with and subject to the

prescribed conditions, long term capital gains arising on transfer of the shares of the Company (in cases not

covered under section 10(38) of the Act) will be subject to tax at the rate of 10% (plus applicable surcharge

and education cess), without any indexation benefit.

55

3. As per section 115F of the Act and subject to the conditions specified therein, in the case of a shareholder

being a non-resident Indian, gains arising on transfer of a long term capital asset being shares of the

Company will not be chargeable to tax if the entire net consideration received on such transfer is invested

within the prescribed period of six months in any specified asset or savings certificates referred to in

section 10(4B) of the Act. If part of such net consideration is invested within the prescribed period of six

months in any specified asset or savings certificates referred to in section 10(4B) of the Act then this

exemption would be allowable on a proportionate basis. Further, if the specified asset or savings certificates

in which the investment has been made is transferred within a period of three years from the date of

investment, the amount of capital gains tax exempted earlier would become chargeable to tax as long term

capital gains in the year in which such specified asset or savings certificates are transferred.

4. As per section 115G of the Act, Non-Resident Indians are not obliged to file a return of income under

section 139(1) of the Act, if their only source of income is income from specified investments or long term

capital gains earned on transfer of such investments or both, provided tax has been deducted at source from

such income as per the provisions of Chapter XVII-B of the Act.

5. As per section 115H of the Act, where Non-Resident Indian becomes assessable as a resident in India, he

may furnish a declaration in writing to the Assessing Officer, along with his return of income for that year

under section 139 of the Act to the effect that the provisions of Chapter XII-A shall continue to apply to

him in relation to investment income derived from the investment in equity shares of the Company as

mentioned in section 115C(f)(i) of the Act for that year and subsequent assessment years until assets are

converted into money.

6. As per section 115I of the Act, a Non-Resident Indian may elect not to be governed by the provisions of

Chapter XII-A for any assessment year by furnishing a declaration along with his return of income for that

assessment year under section 139 of the Act, that the provisions of Chapter XII-A shall not apply to him

for that assessment year and accordingly his total income for that assessment year will be computed in

accordance with the other provisions of the Act.

7. In respect of non-resident Indian, the tax rates and consequent taxation mentioned above will be further

subject to any benefits available under the Tax Treaty, if any, between India and the country in which the

non-resident is considered resident in terms of such Tax Treaty. As per the provisions of section 90(2) of

the Act, the provisions of the Act would prevail over the provisions of the Tax Treaty to the extent they are

more beneficial to the non-resident.

VI. Benefits available to Foreign Institutional Investors („FIIs‟)

Special tax benefits

1. As per section 115AD of the Act, FIIs will be taxed on the capital gains that are not exempt under the

provision of section 10(38) of the Act, at the following rates:

Nature of income Rate of tax (%)

Long term capital gains 10

Short term capital gains (other than referred to in section 111A) 30

Short term capital gains referred in section 111A 15

The above tax rates have to be increased by the applicable surcharge and education cess.

2. As per section 196D(2) of the Act, no deduction of tax at source will be made in respect of income by way

of capital gain arising from the transfer of securities referred to in section 115AD.

3. In case of long term capital gains, (in cases not covered under section 10(38) of the Act), the tax is levied

on the capital gains computed without considering the cost indexation and without considering foreign

exchange fluctuation.

56

General tax benefits

4. As per section 10(34) of the Act, any income by way of dividends referred to in section 115-O (i.e.

dividends declared, distributed or paid on or after 1 April 2003 by the Company) received on the shares of

the Company is exempt from tax.

5. As per section 10(38) of the Act, long term capital gains arising from the transfer of long term capital asset

being an equity share of the Company, where such transaction is chargeable to securities transaction tax,

will be exempt to tax in the hands of the FIIs.

6. As per section 70 read with section 74 of the Act, short term capital loss, if any, arising during the year can

be set off against short term capital gain and long term capital gain. It also provides that long-term capital

loss, if any arising during the year can be set-off only against long-term capital gain. Both the short term

capital loss and long term capital loss shall be allowed to be carried forward upto eight assessment years

immediately succeeding the assessment year for which the loss was first computed. However the brought

forward long term capital loss can be set off only against future long term capital gains.

7. The tax rates and consequent taxation mentioned above will be further subject to any benefits available

under the Tax Treaty, if any, between India and the country in which the FII is considered as resident in

terms of such Tax Treaty. As per the provisions of section 90(2) of the Act, the provisions of the Act would

prevail over the provisions of the Tax Treaty to the extent they are more beneficial to the FII.










day of April 2007:





VII. Special tax benefits available to Mutual Funds

As per section 10(23D) of the Act, any income of Mutual Funds registered under the Securities and

Exchange Board of India Act, 1992 or Regulations made thereunder, Mutual Funds set up by public sector

banks or public financial institutions and Mutual Funds authorised by the Reserve Bank of India will be

exempt from income tax, subject to such conditions as the Central Government may, by notification in the

Official Gazette, specify in this behalf.

B. General benefits available under the Wealth Tax Act, 1957

Asset as defined under section 2(ea) of the Wealth tax Act, 1957 does not include shares in companies and

hence, shares are not liable to wealth tax.

The above Statement of Possible Direct Tax Benefits sets out the provisions of law in a summary manner

only and is not a complete analysis or listing of all potential tax consequences of the purchase, ownership

and disposal of shares.

57

NOTES:

(i) All the above benefits are as per the current tax laws.

(ii) In view of the individual nature of tax consequences, each investor is advised to consult his/her own tax

advisor with respect to specific tax consequences of his/her investments in the shares of the company.

58

SECTION IV: ABOUT THE COMPANY

INDUSTRY OVERVIEW

The information in this section is derived from various government publications and industry sources. Neither us

nor any other person connected with the Issue has verified this information. Industry sources and publications

generally state that the information contained therein has been obtained from sources generally believed to be

reliable, but that their accuracy, completeness and underlying assumptions are not guaranteed and their reliability

cannot be assured and, accordingly, investment decisions should not be based on such information.

We have also relied on reports prepared by Jones Lang Lasalle Meghraj (“JLLM”), entitled Residential

Opportunities in Central India, dated January 10, 2010 and Retail: Off the Beaten Track dated January 10, 2010

(together, the “JLLM Reports”). We commissioned the JLLM Reports for the purposes of confirming our

understanding of the industry in connection with the Issue. Neither we nor any other person connected with the Issue

has verified the information in the JLLM Reports.JLLM has advised that: (i) some information in JLLM database is

derived from estimates or subjective judgments; (ii) the information in the databases of other similar agencies may

differ from the information in JLLM database; (iii) while JLLM has taken reasonable care in the compilation of the

statistical and graphical information and believes it to be accurate and correct, data compilation is subject to

limited audit and validation procedures and may accordingly contain errors; (iv) JLLM, its agents, officers and

employees do not accept liability for any loss suffered in consequence of reliance on such information or in any

other manner; (v) the provision of such information does not obviate any need to make appropriate further

enquiries; and (vi) the provision of such information is not an endorsement of any commercial policies or any

conclusions by JLLM. Prospective investors are advised not to unduly rely on the JLLM Reports when making their

investment decision. The JLLM Reports contain estimates of market conditions based on samples. This information

should not be viewed as a basis for investment and references to the research should not be considered JLLM’s

opinion as to the value of any security or the advisability of investing in us.

Growth in the Indian Economy

India is the world‟s largest democracy by population size and one of the fastest growing economies in the world.

India‟s estimated population was approximately 1.16 billion people as of July 2009. India had an estimated Gross

Domestic Product (“GDP”) on a purchasing power parity basis of approximately US$ 3.3 trillion in 2008, making it

the fifth largest economy in the world after the European Union, United States of America, China and Japan.

(Source: CIA World Factbook) In the past few years, India has experienced rapid economic growth, with GDP

growing at an average growth rate of 8.8% between the fiscal year 2003 to the fiscal year 2007. This high growth

rate was slowed in the fiscal year 2009 with the growth rate of India‟s GDP decelerating to 6.7%, compared to 9.0%

in fiscal 2008, as a result of the global economic downturn. (Source: RBI, Macroeconomic and Monetary

Developments: Third Quarter Review 2009-10)

However, despite the global economic decline in the fiscal year 2008, India is showing positive signs of recovery

following the global economic downturn. Based on the Economic Outlook for fiscal 2010 by the Economic

Advisory Council to the Prime Minister, the Indian Economy may grow by about 7.2% in the fiscal year 2010 and

return to a 9% growth rate in the next two years. The world GDP growth rate for 2010 is estimated at 4.0%

according to the World Economic Outlook, January 2010 published by IMF.

The graph below is a comparison between India‟s expected GDP growth rate during calendar years 2009 and 2010,

as compared to advanced economies, developing economies, China and the world. As shown by the graph, all of the

countries are expected to experience positive growth in the calendar year 2010. This is due to the fact that economic

conditions have improved more than expected, owing mainly to Government intervention. Further, India‟s growth is

expected to outperform advanced and developing economies. Recent data suggests that the rate of decline in

economic activity is moderating, although this is occurring to varying degrees across different regions. Overall,

liquidity has improved and capital market activity has picked up substantially across the world.

59

3.0%

-0.8%

3.9%

-3.2%

2.1%

6.1%

2.1%

6.0%

7.3%

5.6%

7.7%

9.6%

8.7%

10.0%

0.5%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

2008 2009 2010

World Advanced Economies Developing Economies India China

Source: International Monetary Fund, World Economic Outlook Update, January 2010 (Calendar Year Growth Rates)

India‟s recovery from the global economic slowdown (and its own slowdown in credit availability) has been by the

country‟s large domestic savings and corporate retained earnings, which have been used to finance investment.

Similarly, although urban consumption has slowed as a result of a recent decline in the labor market and job losses,

low export dependence, large rural consumption and employment have helped India to sustain consumption. Finally,

fiscal policy, primarily in the form of reduced interest rates and Government intervention, has helped to maintain

private demand, liquidity and short-term rates, thereby reducing the risk of loan losses.

The Real Estate Sector in India

The real estate sector in India comprises the development of residential housing, commercial buildings, hotels,

restaurants, cinemas, retail outlets and the purchase and sale of land and development rights. The real estate and

construction sector play an important role in the overall development of India‟s core infrastructure. It also plays a

significant role in the country's economy. The real estate sector is second only to agriculture in terms of employment

generation and contributes heavily towards the GDP. Almost five per cent of the country's GDP is contributed to by

the housing sector. In the next five years, this contribution to the GDP is expected to rise to 6 per cent. (Source:

India Brand Equity Forum, www.ibef.org)

The real estate sector has evolved in the past 10 years, accompanied by various regulatory reforms. The following

factors have a significant effect on the various segments of the industry:

Economic growth: The International Monetary Fund has projected a positive growth rate for the Indian

economy during calendar years 2009 and 2010. India‟s growth rate is expected to be faster than that of both

the advanced and the developing economies as a whole. Increased ecomonic growth is expected to have

positive effect on the real estate sector. (Source: International Monetary Fund, World Economic Outlook

Update, January 2010)

Demographic profile: The percentage of the Indian population that is made up of the earning population (in

the 20-59 age bracket) is expected to increase. An increase in the earning population usually leads to

increased spending and consumption in the economy which may in turn lead to stronger demand for the

real estate industry.

Growth of mortgage finance and credit take-off: Growth in the real estate sector is directly affected by the

growth of mortgage finance and lending to the real estate sector in the country, both in terms of reach and

affordability. As a large proportion of the investment in real estate sector is funded by bank and financial

institutions, increased credit take-off acts as a stimulus to the sector.

60

Government policies: A number of Reserve Bank of India (“RBI”) initiatives have helped to increase the

real estate sector‟s access to capital. The Government of India in March 2005 amended existing legislation

to allow 100% Foreign Direct Investment (“FDI”) in the real estate sector, subject to certain restrictions. It

is expected that the increased FDI will provide the necessary funding to help meet demand in the

commercial and residential real estate sectors. The following table shows that FDI inflow in the housing

and real estate sector was second only to the services sector during the three most recent fiscal years:

Sector 2007-08

(Rs. in crore)

2008-09

(Rs. in crore)

2009-10

(Rs. in crore)

Services

(Financial and Non-Financial)

26,589 28,411 20,958

Computer Software and Hardware 5,623 7,329 4,350

Telecommunications 5,103 11,727 12,338

Housing and Real Estate 8,749 12,621 13,586

Construction Activities

(including roads & highways)

6,989 8,792 13,544

Power 3,875 4,382 6,908

Automobiles 2,697 5,212 5,609

Metallurgical Industries 4,686 4,157 1,935

Petroleum and Natural Gas 5,729 1,931 1,328

Chemicals

(other than fertilizers)

920 3427 1,707

(Source: Department of Industrial Policy and Promotion, Fact Sheet On Foreign Direct Investment (FDI),

March 2010)

While the real estate sector in India has historically been unorganized, the sector has, in recent years,

exhibited a trend towards greater organization and transparency, accompanied by various regulatory

reforms. These reforms include:

the support of the Government of India in repealing of the Urban Land (Ceiling and Regulation)

Act (“ULCRA”), most state governments have repealed ULCRA except for West Bengal, Bihar

and Jharkhand;

modifications in the Rent Control Act to provide greater protection to homeowners wishing to rent

out their properties;

the rationalisation of property taxes in a numbers of states; and

the proposed computerisation of land records.

This trend has contributed towards the development of reliable indicators of value and organized

investment in the real estate sector by domestic and international financial institutions and has resulted in

the greater availability of financing for real estate developers and homeowners. The increased investment in

the real estate sector is being driven by: rising demand; heightened consumer expectations that are

influenced by higher disposable incomes; increased globalization and the introduction of new real estate

products and services.

61

Key Segments of Indian Real Estate

Retail Real Estate Infrastructure

Changing Consumption Patterns of Indian Consumers

Historically, the Indian retail sector has been dominated by small independent local retailers, such as traditional

neighborhood grocery stores. However, during the 1990s, organized retail outlets gained increased acceptance due to

an increase in the number of working women, changes in perception of branded products, entry of international

retailers and a growing number of retail malls. India‟s retail boom primarily originated in the Mature cities and has

subsequently expanded to High Growth and Emerging cities (as defined below), with leading retailers and

developers continuing to plan shopping malls and hypermarkets in these locations.

The growth of organized retail segment is expected to be driven by demographic factors, increasing disposable

incomes, the increased purchasing power of the growing middle class and consumerist aspirations, in addition to

macro economic policy decisions, such as allowing FDI in single brand retailing and cash-and-carry formats.

Although real estate development in the retail sector is relatively new in India, both domestic and foreign investors

have invested substantial capital in this sector in recent years.

The size of the Indian retail market was approximately US$ 410 billion in calendar year 2008, out of which modern

retail was approximately US$ 18 billion. Projected retail demand figures show that Indian retail market is expected

to be approximately US$ 535 billion by 2013. Out of this, modern retail would constitute US$ 73 billion, which

would result in a Compounded Annual Growth Return (“CAGR”) of over 30%. Investment up to US$ 30 billion is

anticipated over next five years in the modern retail sector. Over 20,000 new retail outlets are expected to open in

next two years. (Source: Technopak Report: India Growth Story: Pyramid To Diamond – Rise Of Consuming Class,

March 2009)

0

10

20

30

40

50

60

70

80

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

0%

5%

10%

15%

20%

25%

30%

35%

Organised retail Growth Rate

(Source: Technopak Report: India Growth Story: Evolving Consumer & Retail, December 2009)

US$ Bn

62

8 18 73170

783

1161

1487

2135

280410

535

755

0

500

1000

1500

2000

2500

2003 2008 2013(P) 2018(P)

Modern Retail Retail GDP

(Source: Technopak Report: India Growth Story: Pyramid To Diamond – Rise Of Consuming Class, March 2009)

Following chart shows growth in the Indian retail sector in terms of number of stores, experienced in last five years

and expected in next two years, by some of the leading retail brands in India:

10105

24

1000

2000

2500

1000 1000

19465

693

489

10001214

700

11597 200

300

0

500

1000

1500

2000

2500

3000

Big Bazaar Tanishq Reebok Koutons The Mobile

Store

Reliance

Fresh

Café

Coffee Day

2003 2008 2010(P)

(Source: Technopak Report: India Growth Story: Pyramid To Diamond – Rise Of Consuming Class, March 2009)

Historically, the Indian consumer was focused more on basic items such as food and grocery. Research conducted

by Technopak estimates that the consumption pattern and spending habits of the Indian consumers are undergoing a

fundamental change as they shift their focus from basic to discretionary spending. From the period 2003 to 2013,

discretionary spending is expected to grow from 27% to 32%, whereas food and grocery spending is expected to

reduce from 40% to 32%.

Indian Retail Sector Overview

Organized retail is being driven throughout India by resilient consumers who are typically young, urbanized and

brand-conscious shoppers with changing preferences towards consumerism and the means to pursue it. This growth

in organized retail has been aided by the increased number of shopping malls built over the last three years, an

increasing number of which are located in the nation‟s smaller, underserved markets. (Source: Technopak Report:

India Growth Story: Pyramid To Diamond – Rise of Consuming Class, March 2009)

The penetration of organized retail is increasing and a large number of retailers are increasing their presence in

anticipation of growth opportunities. Organized retailers are planning to spread all over the country. In addition,

major global retailers are also establishing a presence in India to benefit from retail sector.

US$ Bn

63

Purchasing Power and Affluence of India’s Emerging Cities:

Two indicators are used to quantify the purchasing power and affluence levels of the markets represented by the

High Growth and Emerging cities:

Market Potential Value (“MPV”): Represents the aggregate purchasing power of a city

Market Intensity Index (“MII”): Represents the quality and affluence of consumers and markets.

The graphical analysis of 20 emerging cities by Jones Lang Lasalle Meghraj illustrates that while all cities score well

below the maximum MPV index value of 1000 for Greater Mumbai, the cities of Surat, Nagpur, Jaipur, Vadodara,

Coimbatore and Indore emerge from the group in terms of purchasing power. Over half of the 20 cities scored above

the all-India MII average of 100 with Goa, Mohali, Ludhiana, Vadodara, Coimbatore, Kochi and Nagpur showing

the highest levels of affluence within the group.

(Source: Jones Lang Lasalle Meghraj Report - “Retail: Off the beaten track”, January 2010).

64

Hospitality

The Indian hospitality industry has emerged as one of the key industries driving the growth of the services sector

and, thereby, the Indian economy. The hospitality sector has shown substantial growth over the last decade, growing

from 7.9% in the fiscal year 2001-02 to 11.5% in the fiscal year 2007-08, consistently exceeding India‟s GDP

growth rate every year.

Over the last three years, the sector has witnessed a substantial phase in performance, which has continued in the

first half of the fiscal year 2009. One of the key reasons for the increase in demand for hotel rooms in the country

has been the significant growth in the overall economy and substantial growth in sectors including information

technology, telecom, banking and finance, insurance, construction, retail and real estate. However, the global

economic downturn adversely affected the performance of the industry in the latter part of the fiscal year 2009.

The growth of the Indian hospitality sector can be attributed to factors that can be classified into three broad

categories: regulatory growth drivers, external growth drivers and internal growth drivers

Regulatory Growth Drivers

The Department of Tourism, Government of India has initiated a number of steps to ensure full utilization of the

potential which tourism holds for India‟s economy. Current regulations by the Government of India allow 100% FDI

in the Hospitality Sector through the automatic route. This has increased the amount of capital available for

investment into the sector.

Specific incentives given to the hospitality industry at the central and the state level include:

Incentives at Central Level:

Elimination of customs duty for import of raw materials, equipment and liquor among others;

Capital subsidy program for budget hotels fringe benefit tax exempted on crèche, employee sports and

guest house facilities; and

Five year income tax holiday granted to two to four star hotels established in specified districts which have

been declared UNESCO-declared 'World Heritage Sites'

Incentives at State Level:

Exemptions on luxury tax and sales tax for five to seven years for new projects;

Small capital subsidy for the development of budget hotels;

Below market rate allotment of land controlled by States for development projects;

Five year income tax holiday for two to four star hotels and convention centers (minimum 3,000 people) in

National Capital Region (“NCR”); and

In order to increase the built-up area of Delhi, zonal auction rate has been reduced by the Government of

India.

65

External Growth Drivers

1. Rising GDP

Overall India‟s economy has experienced a positive rate of growth with a growth rate of 9.6% and 9% in

the fiscal year 2007 and the fiscal year 2008 respectively. Despite slowdown, the GDP growth for the fiscal

year 2009 is projected at 7.1%. An increase in GDP may act as a stimulant to growth in the hospitality

sector.

GDP

7831,050

1,487

2,135

-

500

1,000

1,500

2,000

2,500

2003 2008 2013 2018

US

$ B

n

(Source: Technopak Report: Indian Hospitality Industry Outlook, February 2009)

2. FDI Inflow

Of the total FDI inflow between the fiscal years 2000 and 2008, the hospitality sector contributed 1.56% of

the total inflow, amounting to US$ 1.07 billion. The hospitality sector requires more than US$ 10 billion

investment in the next two to three years for which the government is relying on FDI. (Source: Technopak

Report: Indian Hospitality Industry Outlook, February 2009)

3. Changing Consumer Dynamics and Ease of Access to Finance

Nominal per capita income growth averaged at approximately 7.3%, which was higher than the average

inflation rate of 5.1% during fiscal years 2004 to 2008. India has also experienced significant growth in the

credit card market. The credit card base in 2008 was estimated to be 25 million and this is expected to grow

at 20 to 25% per annum. Driving this growth is the increased use of credit cards for the purpose of

purchasing due to attractive and consumer friendly schemes being offered by various banks. 35% of those

who use credit cards use it for travel, hotel and dining.

4. Increasing Domestic and International Tourist Arrivals

There has been an increase in the number of tourists, both domestic as well as international.

From 310 million domestic visits in 2003, the number rose to 529 million in 2007, a CAGR of 14%. The

Ministry of Tourism‟s vision is to achieve 760 million domestic visits by the year 2011, with an annual

average growth rate of 12%.

Foreign tourist arrivals (“FTAs”) increased by 5.7% during 2008 and reached 5.37 million compared to

5.08 million during 2007. Foreign exchange earnings increased by 8%, to US$ 11.5 billion in 2008 from

US$ 10.70 billion in 2007. The Ministry of Tourism aims to achieve a figure of US$ 11 billion by 2011.


66


Internal Growth Drivers

1. Demand Supply Imbalance

Statistics on the demand and supply for hotel rooms indicate that India currently has around 114,200 hotel

rooms spread across various hotel categories and is facing a shortfall of approximately 156,000 rooms. The effect of this demand and supply gap is felt through increased room tariffs.

Current Supply Gap in the number of rooms


2. New Entrants in the Sector

The Government of India until December 2007 has approved the construction of 85,000 hotel rooms

resulting in the emergence of different entrants in the industry ranging from real estate companies, private

equity firms, and IT companies. (Source: Technopak Report: Indian Hospitality Industry Outlook,

February 2009)

Residential Development

The residential segment consists of the development of apartments, houses and plotted developments in urban and

rural areas. Pan-India residential demand is estimated to be more than 7.5 million units by 2013 across all categories,

including luxury, mid-market and low income housing. Historically, cities have been a driving force in the economic

and social development of a nation. At present approximately 307 million Indians live in nearly 3,700 towns and

cities spread across the country. This represents 30.5% of its population, in contrast to only 15% (60 million) who

lived in urban areas in 1947 when the country achieved independence. Over the past 50 years, the population of

India has grown two and half times, while urban India has grown by nearly five times.

Today there are nearly two dozen cities in India with a population exceeding one million in addition to the county‟s

top eight metros, collectively making up nearly one third of the country‟s entire urban population. Most of the cities

are either state capitals or centres of large economic activity for their respective states. These non-metro cities, over

the last decade, have created their foot prints on India‟s real estate maps. These cities represent a large market which

67

is underserved by real estate developers from the organized residential sector. (Source: Jones Lang Lasalle Meghraj

Report: Residential Opportunities in Central India, January 2010)

The chart set forth below shows the “Residential Affordability Index” of some of India‟s fast growing and emerging

cities:

(Source: Jones Lang Lasalle Meghraj Report: Residential Opportunities in Central India, January 2010)

The demand-supply scenario in India‟s residential real estate sector is dependant on a number of factors, some of

which are described below:

Rapid urbanization: Historically, India has witnessed increasing urbanization, with the urban population increasing

from 18% of total population in 1961 to approximately 28% of total population by 2001. (Source: India Census)

This trend has given rise to increased need for quality housing within urban areas.

Rising disposable income and a trend towards ownership: The high economic growth rate that India has

experienced in recent years has led to an increase in disposable income and greater consumption. This, in turn, has

led to enhanced aspirations and a desire to own homes.

Growing middle class and favorable demographics: Increased demand for housing from the middle income segment

is expected to be a key feature in the growth of the Indian real estate industry. India‟s growing population in the

earning age bracket, along with an increase in disposable income in this bracket, is recognized as a key driver of

growth in housing demand.

Nuclear families: Indian families are gradually moving away from the concept of joint families to nuclear-single

household families, which has resulted in increased demand for housing in the country.

Fiscal incentives: Income tax incentives on housing loans are another contributing factor in supporting the growth of

residential housing property. Fiscal incentives are provided to the borrowers of housing loans in the form of

exemptions and rebates on interest and principal repayments. These have a significant effect on housing budgets and

support spending on housing facilities.

Housing finance: The level of penetration of housing finance as a financial product is directly related to the

affordability of the product to end consumers. Increased access and the growth of the secondary market will result in

reduced cost and also support the residential real estate sector.

68

Classification of Indian Cities based on Growth

Classification Characteristics Cities

Mature Strongest socio-economic fundamentals

Highest number of domestic and international brands

present

Highest number of operational and planned shopping

malls

Delhi, NCR and Mumbai

Transitional High economic growth rates, large middle class and

above average income

Developers are increasingly active with new

shopping mall projects

Most national brands are already present;

international brands have arrived or are planning to

make an entry

Ahmedabad, Bangalore, Chennai,

Hyderabad, Kolkata, Pune

High Growth On the radar of retailers who are attracted by high

incomes and strong brand awareness

Substantial level of shopping malls planned or under

development

Widely considered “the next retail destination”

Indore, Jaipur, Kochi, Ludhiana,

Mohali, Surat, Vadodara

Emerging Are part of the expansion plans of hypermarkets and

department stores

Consumers have growing incomes and rising

aspirations

Scarcity of brands and growing corporate activity are

leading to increased demand for organized retail

Coimbatore, Goa, Nagpur, Raipur,

Trivandrum, Udaipur

Nascent Organized retail is currently very limited though

department stores and hypermarkets may exist

On the “watch list” of pioneering retailers and

developers who are seeking to benefit from a “first

mover advantage”

Although development of organized retail sector is

slow, this can change quickly as local economies

react to new corporate arrivals

Bhilai, Bhopal, Guwahati, Jabalpur,

Nanded, Ujjain, Vijayawada

(Source: Jones Lang Lasalle Meghraj Report: Retail: Off the Beaten Track, January 2010)

Emerging Destinations and Tier III Cities

Indore

Indore, the commercial capital of Madhya Pradesh, is the centre of business and trading activities in Central India.

While the city is also known for its textile industry, Indore is undergoing fast-paced infrastructure development to

match the future demand from other industrial sectors. State and local governments are undertaking several

initiatives to promote Indore as a premier destination for investment. As a historic city, Indore has a distinct core

(old city) with newer developments spread spatially around in a concentric manner. Residential, retail and

institutional areas dominate the city’s core.

Indore

Population ('000s, 2008) Income / Capita (US$, 2008)

2,071 938

Prime Locations Secondary Locations

Capital Values (US$/sq ft) Capital Values (US$/sq ft)

54-86 36-54

69

Locales Locales

M G Road, Parts of A B Road,

Bypass, MR 10, New Palasia

Parts of A B Road, Vijay Nagar, Sanket Nagar, Shringar Colony, Kanchan

Baug, Ratlam Kothi, Gulmohur & Green Park Colony


Retail Market Dynamics:

In the old city of Indore, wholesale markets are prevalent and traditional high streets dominate the retail landscape.

Presently, a significant amount of retail activity is occurring in the central and eastern parts of the city close to the

high-end residential locations of Palasia, Race Course, Saket, Gulmohar and the upcoming locations of Vijay Nagar,

MR 10 and Indore Bypass.

A number of affluent entrepreneurs who reside in Indore are driving the demand for local brands along with national

and international retailers. Older, unorganised high street markets are slowly giving way to organised retail with the

arrival of new malls and shopping centres in the city. Approximately 1.7 million sq ft of retail space currently exists

in Indore with another 2.5 million sq ft expected in the next few years as 3 to 4 mall projects have been announced.

(Source: Jones Lang Lasalle Meghraj Report: Retail: Off the Beaten Track, January 2010)

Residential Market Dynamics:

Residential real estate development in Indore is active predominantly along the transport corridors of National

Highway No. 3 (Mumbai - Agra) and National Highway No. 59 (Indore - Ahmedabad). Established residential areas

in the city are the Old City (Juni Indore), M.G. Road, A.B. Road, Vijay Nagar, Sanket Nagar, New Palasia, Shringar

Colony, Kanchan Baug, Ratlam Kothi, Gulmohur & Green Park Colony. The emerging residential areas within the

city are Ring Road - Mahalakshmi Nagar, Bypass and MR 10. Many national level developers are developing

residential townships that include social infrastructure such as schools, small hospitals, club houses, recreation

spaces, retail space areas and multiplexes. Most of the proposed township projects are situated along the Bypass,

A.B. Road and MR - 10. (Source: Jones Lang Lasalle Meghraj Report: Residential Opportunities in Central India,

January 2010)

Mohali

Mohali is a city adjacent to Chandigarh, in the state of Punjab. The city has a high average literacy rate of 83%. The

economy of Mohali is characterized by the presence of a number of state-local companies including Punjab Tractor

Limited, ICI Paints and the Godrej Group. Recently, technology leaders such as Infosys, Dell, Quark, Philips and

SCL have established their development centres in Mohali. Denver based Quark has created Quark City, a US$ 500

million, 46-acre business park in Mohali, complete with a residential complex and facilities for shopping,

entertainment, medical, and education. It is expected to generate 25,000 direct and 100,000 indirect jobs.


Mohali may be regarded as a planned extension of the city of Chandigarh. Residents of this town are required to

travel to Chandigarh to shop due to a shortage of quality local retail destinations. The main markets of Mohali have

been developed as sector markets as the cities of Chandigarh and Mohali are collectively divided into 74 sectors.

Many of Mohali‟s sector markets are located on a straight road from Sector 58 to 65. Most of the ground floor space

in this retail corridor has been occupied by local merchants including restaurants, grocery shops, departmental

stores, jewellers, white good showrooms and banks. The Punjab Urban planning and Development Authority

(“PUDA”) is developing Sector 70 as a local market to entice Mohali residents to shop locally.

Underlying factors including a large segment of the population with higher socio-economic profiles seeking

residential options in the region, proximity to Chandigarh and initiatives taken by the Government of Punjab to

promote industrial and IT / ITES development are likely to have a positive effect on Mohali‟s retail development.

Shalimar Mall and Mall Matrix, with a combined area of 300,000 sq. ft. were the first malls proposed in Mohali. Six

additional malls, are in various stages of construction. These projects, along with others that have been planned,

could add an additional 5.5 million sq. ft. of new retail space.

70

Udaipur

Udaipur with its several lakes and picturesque setting is a major tourist destination for both domestic and

international tourists. The city is also a center for performing arts, crafts and its famed miniature paintings. The

city‟s primary commercial occupations are tourism and mining. Secondary and tertiary activities are increasing in

the northeast of the city. Amberi, Sukher, Sobhagpura, Raghunathpura and Bhuwana located in the north / northeast

of Udaipur have small scale industries and mining pits. The Dabok, Gudli and Gadwa areas are in the developed

Mewar industrial area. Other small-scale industries have also come up along the corridor towards Chittorgarh. Major

development activities have increased near the rivers, lakes and highways of Udaipur. Udaipur is developing

outward along National Highway No. 8 to Ahmedabad and National Highway No. 76 to Chittorgarh.

Udaipur


550 1,583



54-64 36-54

Locales Locales

Madhuban, Ashoknagar, Sukhadia Circle, Fatehpura,

Panchvati, Bhupalpura, Parts of HiranMagri

Navratan Complex, Savina, Pratapnagar, Parts of

HiranMagri, Shobhagpura, Badgaon, Bhuvana



The lake city of Udaipur is a popular tourist destination in India. Historically, retail markets in Udaipur have been an

integral part of the city. As Udaipur grew beyond the banks of its lakes, major transportation arteries developed into

retail corridors. Retail high streets continue to be a fixture along Bapu Bazaar, Chetak Circle, Suraj Pole, Ashwini

Bazaar, Nehru Bazaar, Bada Bazaar, Shastri Circle, Delhi Gate, Sindhi Bazaar, Town Hall and Chand Pole. These

are complimented by specialized high streets at Ghantaghar Market (jewellery), Malda Estate (apparel) and Hathi

Pole (antiques).

Organized retail is widespread throughout Udaipur with Durga Nursery Road, Shakti Nagar and Sudkhadia Circle

possessing the largest concentration of new entrants. The 372,000 sq. ft. Celebration Mall, a joint venture between

Singapore based CapitaLand and Delhi based Advance India Projects, is under construction at Bhuwana along

National Highway No. 8 and is expected to become operational shortly after Rkay Mall Shopping Complex, a

100,000 sq. ft. project being developed at Panchawati becomes operational. A wide selection of international and

domestic brands are present in Udaipur across various categories of retail including Nokia, Adidas, John Players,

Levi Strauss and Pizza Hut. Domestic supermarkets such as Big Bazaar and Reliance Fresh have also established

themselves in prominent locations in Udaipur. Movie theatres, both new (Fun Cinemas) and reconstructed (Paras

Cinema) are also well present in the city.


The major typology of residential development in Udaipur has been low-rise bungalow type developments. High

land prices and less space availability have led to the development of apartments in some new developments. Also

as a result of the difficult topography of the city, limited area is available for horizontal expansion and hence the

trend of apartment houses and flats is developing in the city. The upscale residential areas of Udaipur are Madhuban,

parts of HiranMangri, Sukhadia Circle, Fatehpura, Bhupalpura, Polo Ground, and Navratan Complex, Sectors 3, 4, 5

and 11 among others.

71

Raipur

The general real estate trend in Raipur has shown upward trend in large scale construction and development

activities in the last three to four years. This may be attributed to the creation of Chhattisgarh as a separate state and

Raipur as its capital in the year 2001, which led to the city becoming an administrative center, in addition to trade

and business. This has led to increased migration of population in the state.

Naya Raipur is located between two national highways NH6 and NH43. The city is spread over an area of 8,000

hectares. It will be the fourth planned city in India after Gandhinagar, Chandigarh and Bhubaneshwar. The main

activity of the Naya Raipur city will be to administer the affairs of the state of Chhattisgarh. However, other

economic activities like software technology parks, gems and jewellery, business offices, health education and

research services and other regional recreational activities have also been proposed for the city.

Raipur


1,166 1,583



39-51 32-43

Locales Locales

Sadar Bazaar , Malviya Road, Areas of Tatyapara, Civil

Lines, Fafdi, Shankar Nagar, Anupam Nagar, Shanti

Nagar VIP colony, Khamadi, Mova, Avanti Vihar



Raipur, a major trading and business hub for the entire Chhattisgarh region, has a large number of specialized

markets for various commodities. A majority of these traditional markets are located in the centre of the city with

new retail areas emerging along the Grand Eastern Road (National Highway No. 6). The stretch on National

Highway No. 6 between Tati Bandh to Teli Bandha has emerged as the most active retail destination in the recent

years. Sharda Chowk and Jaistambh Chowk are well established markets in the city centre.

A few small, unorganised shopping centres have been completed over the past few years, with Raipur getting its first

shopping mall, City Mall 36, last year. Three additional shopping malls are in advanced stages of development, two

of which, Celebration Mall and Treasure Island, are located on Grand Eastern Road / National Highway No. 6 with

the third located in Pandri, Raipur‟s traditional cloth market. Other major retail projects include the Lal Ganga

Shopping Complex and Millennium Plaza. The Lal Ganga Mall is an unorganised shopping center, which includes

some prominent national brands.


The decision to create a new capital, Naya Raipur City, which would include an addition of about 600,000 residents

by 2020 is a major reason for the increase in real estate development activity. The city has a dense core dominated

by commercial, retail and institutional activities. Residential development in Raipur is concentrated around this

retail and commercial hub along the Grand Eastern Road (National Highway No. 6). The central business district

area of Raipur City comprises of Sadar Bazaar and Malviya Road. The neighbouring areas of Tatyapara, Civil Lines,

Fafdi, Shankar Nagar, Anupam Nagar and Shanti Nagar among others are primarily residential in nature. Emerging

micro-markets like VIP colony, Khamadi, Mova and Avanti Vihar which are developing outwards from the core and

closer to the airport as well as in Naya Raipur city.

72

Bhilai

Bhilai is located in the durg district of Chhattisgarh State, approximately 40 kilometers from the State capital Raipur

along National Highway No. 6. Bhilai is the second largest city in the state of Chattisgarh and is known as the steel

capital of India. Home to India‟s largest steel plant, SAIL, Bhilai is one of the most industrialized areas of the state.

The influx of professionals working at SAIL has added a cosmopolitan atmosphere to the local culture and created

demand for organized retail. Bhilai is ranked as the top city in Chhattisgarh for its market potential and affluency.

Bhilai


1,253 1,146



25-32 21-26

Locales Locales

Nehru Nagar, Ashok Nagar, Smriti Nagar MR (Main Road) 9 parallel to National Highway No. 6



National Highway No. 6 is the central retail corridor in Bhilai with major developments located around the main

junctions of the highway. Among the city‟s sectoral markets, the city centre and Sector-6 markets are the most

popular. The format of retail developments in Bhilai are mostly high street in nature with some mixed-use retail and

office complexes found in projects such as Chauhan Estate and Dhillon Complex. A number of brands including

Raymond, Reebok, Titan, Koutons, Gini & Jony and Peter England may be found in markets along National

Highway No. 6 such as Supela Chowk and Akash Ganga.

Retail projects in the upcoming areas of Bhilai typically do not have an independent existence but can be located on

the ground and first floors of residential apartments. These are mostly full service department stores. Although there

are no multiplexes in Bhilai, some traditional cinema halls including Venkatesh, Maurya and Chandra have

undertaken upgrades to cater to the city‟s present needs. Presently, Bhilai does not have any shopping mall although

a 690,000 sq ft project is being developed by Entertainment World Developers, which is expected to launch in 2011.


Organised real estate in Bhilai was underdeveloped until recently. The facilities, both residential and social

amenities, provided in the steel plant townships probably weakened the urge to develop organised real estate outside

the township area. However, recently Bhilai has experienced rapid growth in residential real estate.

Most of the urban growth is occurring in and around corporation area. Moreover, since the stretch of National

Highway No. 6 around SAIL corporation area operates as a toll road, Main Road 9 of corporation area, which runs

parallel to National Highway No. 6, has become a major thoroughfare. This has increased the physical growth of

corporation area towards the north. Apart from the township, other urban areas include Bhilai Municipal

Corporation, notified urban areas such as Bhilai - 3 and Kumhari.

The evolution of townships started along the national highway and developed further south. The main residential

areas are located in Nehru nagar, Ashok nagar, Smriti nagar among others. With the increased importance of Main

Road 9, which runs parallel to National Highway No. 6, the residential development is moving towards Durg. There

have been some successful organised real estate projects developed during the last two to three years. The success of

some of the real estate projects has encouraged other developers to start new ventures. (Source: Jones Lang Lasalle

Meghraj Report: Residential Opportunities in Central India, January 2010)

73

Nanded

Nanded is the capital of Nanded district region of Maharashtra with an area of 51.76 sq. km. The economy of the

city is based on agriculture which is also the largest employer of people living in the city. Nanded is also a religious

hub to India‟s Sikh community and has one of most prominent Gurudwaras in the country.


As a trading and business center for nearby towns and the rural hinterland, the city of Nanded has well established

retail markets. Station Road, Vazirabad, Shivaji Nagar and Doctors Lane are the prominent retail and commercial

hubs of the city. A 380,000 sq. ft. mall being constructed by Entertainment World Developers will be Nanded‟s first

mall. Barara Tower and Alibhai Complex are the only two prominent mixed-use retail and commercial projects

being developed with a total area of approximately 30,000 sq. ft. (Source: Jones Lang Lasalle Meghraj Report:

Retail: Off the Beaten Track, January 2010)

Trivandrum

Trivandrum, the capital of Kerala, is the second largest city in the state, with a large population of urban

professionals. As per the census of India 2001, Trivandrum has a high literacy rate of 93%, as compared to Kerala

(91%) and India (79.9%). Technopark, a 340 acre IT park located in Trivandrum, is one of the largest IT parks in

India with 150 IT firms and over 20,000 employees. Large scale employment opportunities are a major reason why

Trivandrum experienced a 42% increase in population from 1991 to 2001 and why it is ranked second in the state of

Kerala for its market potential and affluence.


Trivandrum‟s central business district is also the center of the city‟s traditional retail district with Palayam, Chala

and East Fort being the three most prominent markets. M.G. Road and the area between Pattom and

Kesavadasapuram are the growth corridors of retail in the city. Kedaram, Karimpanal Arcade and Attukal Shopping

Complex are some of the noteworthy shopping destinations within the city. While retailers have land banks in the

suburban areas (in close proximity to Technpark), major developments are yet to take place. (Source: Jones Lang

Lasalle Meghraj Report: Retail: Off the Beaten Track, January 2010)

Vadodara

Vadodara lies along Gujarat‟s golden corridor which extends from Ahmedabad to Vapi. The city is one of India‟s

foremost industrial centres with a large group of chemicals and pharmaceuticals manufacturers.


The center of Vadodara consists of residential, commercial and institutional districts. Wholesale markets and high

street retail areas dominate the retail typology in this core area of the old city and adjacent areas. The old city

comprises Vadodara‟s traditional markets, which can be found along the prominent shopping corridors of Mahatma

Gandhi Road (Nyay Mandir Gate to Mandavi Gate), Raopura Road, Rajmahal Road, Mangal Bazaar and Dandiya

Bazaar.

Vadodara‟s emerging commercial and retail districts are principally located on the western side of the city‟s railway

line. R.C. Dutt Road, Race Course Road and Old Padra Road have emerged as prime retail and commercial

destinations within the city. A majority of the national and international brands operating in Vadodara are primarily

located along these roads. The predominant typology of retail developments found here are commercial complexes

with retail space on the lower and upper ground floors with office space above. Approximately 4.6 million sq. ft. of

retail space is operational in Vadodara with another 1 million sq. ft. of new retail space expected to enter the market

in the next few years. (Source: Jones Lang Lasalle Meghraj Report: Retail: Off the Beaten Track, January 2010)

74

Ujjain

As a city of cultural and religious importance, Ujjain receives a large number of tourists throughout the year. In

addition, Ujjain is host to a number of famous religious fares which draw up to half a million pilgrims. Economic

activity in Ujjain is based on the agricultural industry for which the city serves as a regional wholesale market.


Small, traditional shops dominate the retail landscape in Ujjain. The main market area of the city, adjacent to Free

Ganj Tower, is resident to domestic apparel brands including Peter England, John Players, Charlie Outlaw and

Raymond. Gopal Mandir and Satigate are two other prominent shopping districts within the city. Presently, the city

does not have an organized retail shopping center, however Treasure Island (Ujjain), a 400,000 sq. ft. shopping mall

on Dhanwantri Chikisa Kendra Road, is in an advanced stage of development. (Source: Jones Lang Lasalle Meghraj

Report: Retail: Off the Beaten Track, January 2010)

Jabalpur

Jabalpur, with 1.2 million residents, is one of the wealthier cities in the state of Madhya Pradesh. It is the

headquarter to several important central and state government departments which employ thousands of government

workers. Jabalpur serves as a distribution center for a wide variety of products and natural resources. It is ranked

third in the state for its market potential and affluence.


Residents of Jabalpur, who have relatively higher disposable incomes among the Nascent cities, shop at the

traditional markets of Soni Bazaar, Madhital and Sadar Market. The development of Treasure Island (Jabalpur), a

680,000 sq. ft. retail project, is expected to add a new dynamic to the local retail landscape. (Source: Jones Lang

Lasalle Meghraj Report: Retail: Off the Beaten Track, January 2010)

Challenges Facing the Indian Real Estate Sector

Lack of national reach of existing real estate development companies

There are currently very few real estate development companies in India who can claim to have operations

throughout the country. Most real estate developers in India are regionally based and active in areas where the

conditions are most familiar to them. This is due to factors such as:

the differing tastes of customers in different regions;

difficulties with respect to large scale land acquisition in unfamiliar locations;

inadequate infrastructure to market projects in new locations;

the large number of approvals which must be obtained from different authorities at various stages of

construction under local laws; and

the long gestation periods of projects.

Local know how is a critical factor

The nature of demand and the regulatory framework of the local authorities significantly vary in different regions.

Demand is dependent on many factors

Real estate developers face challenges in generating adequate demand for many projects. The factors that influence a

customer‟s choice in a property are not restricted to quality alone, but also depend on a number of external factors,

including proximity to urban areas, and facilities and infrastructure such as schools, roads and water supply, each of

which is often beyond the developer‟s control. Demand for housing units is also influenced by policy decisions

relating to housing incentives.

75

Increasing raw material prices

Construction activities are often funded by the client, who makes cash advances at different stages of construction.

In other words, the final amount of revenue from a project is pre-determined and the realisation of this revenue is

scattered across the period of construction. A significant challenge that real estate developers face is dealing with the

increasing costs for raw materials. The real estate sector is dependent on a number of components including cement,

steel, bricks, wood, sand, gravel and paints. As the revenues from sale of units are predetermined, adverse changes

in the price of any raw material directly affect developers‟ results.

Interest rates

One of the main drivers of the growth in demand for housing is the availability of finance at low rates of interest.

Interest rates have increased between 2004 and 2008, however, interest rates have shown signs of reducing recently

and most leading financial institutions have recently reduced the rates which they charge on housing loans.

However, any adverse changes in interest rates, which are beyond the developer‟s control, may affect the real estate

demand.

Tax incentives

The existing tax incentives available for housing loans are one of the major factors influencing demand. These tax

incentives, however, are based on the recommendations of various committees and panels and are likely to be

withdrawn. The Kelkar Panel has recommended phasing out the income tax deduction available on interest on

housing loans for owner-occupied houses.

76

BUSINESS

Overview

















































77























Treasure

Market

City

Treasure

Island

Treasure

Bazaar

Treasure Town

and Vihar

Total

Completed Projects




0.65

0.86 - 1.51



0.45

0.58 - 1.03

Ongoing Projects




3.00

3.21

1.03 11.03 18.27



2.02

2.32

0.77 11.03 16.14





0.87

- 4.19 5.06



0.75

- 4.19 4.94

Grand Total




3.00

4.73

1.89 15.22 24.84



2.02

3.52

1.35 15.22 22.11

78











Strengths

We believe that the following are our principal strengths:


In contrast to traditional real estate development companies which generally develop and sell properties, we own

most and operate all of our shopping center properties, including Treasure Island-Indore, Treasure Central-Indore

and Treasure Bazaar-Nanded. We currently own and operate a total Leaseable Area of 1.03 million square feet at

these three shopping centers through project-specific SPVs. This assures us of stable revenues for the terms of the

various leases which are generally for terms of 36 to 60 months. We have received rental income from the lease of

properties of Rs.230.35 million for the financial year 2010 (includes our share of rental income generated from our

joint venture project, Treasure Central-Indore). Upon completion of our retail and hospitality projects that are part of

our Ongoing Projects and Forthcoming Projects and along with our Completed Projects, we will operate and have

ownership interests in one Treasure Market City project, six Treasure Island projects and five Treasure Bazaar

projects, which will continue to provide us with steady revenues.


We believe that the business of developing and operating successful shopping centers is attributable to the

consumption pattern of target customers, which comprises spending patterns and behavior within a catchment area

and is less related to real estate development. We also believe that the income earning potential of a shopping center

is not directly linked to the prevailing real estate prices in the vicinity, but is more linked to a shopping center‟s

tenant mix and quality of management. We intend to maximize the potential of a particular catchment area by

having the right tenant mix, which we believe leads to higher consumption rates.

For our shopping center developments, we have adopted a lease model, whereby we operate and maintain ownership

interests in the shopping centers we develop. We have leased and plan to lease out space across various properties

under lease structures where we receive basic minimum rentals and a percentage of revenue generated by the tenant.

While this assures us of minimum rentals across our retail properties, it also enables us to receive a share of the

revenues generated by our tenants‟ in-store sales, which aligns our interests with those of our tenants. Given our

business model and structuring of lease agreements, our lease rentals increase as consumption increases in a

particular location. This differentiates us from other typical real estate development companies and links our

business model to the consumption pattern of target micro-markets.

We have received rental income from the lease of properties of Rs.230.35 million for the financial year 2010

(includes our share of rental income generated from our joint venture project, Treasure Central-Indore), and

Rs.158.94 million and Rs.149.05 million for the financial years 2009 and 2008, respectively. We expect that we will

own most and operate all of our retail and hospitality projects that are part of our Ongoing Projects and Forthcoming

Projects including one Treasure Market City project, five Treasure Island projects and three Treasure Bazaar

projects, which will continue to provide us with stable rentals. With the completion of these projects, we are

expected to become one of the largest shopping center owners and operators in India in terms of number of

79

operational shopping centers. (Source: “Retail off the Beaten Track,” January 10, 2010, Jones Lang LaSalle

Meghraj)


We believe that our shopping centers are the preferred choice among retailers in the cities in which we operate and

provide a platform for large retailers to expand their businesses in such cities with a common partner. To

successfully lease out a shopping center, we believe that the retailer‟s confidence in the developer is a very

important factor, especially in fast growing and emerging cities where there are few organized national developers.

We believe that retailers have confidence in us due to our track record in achieving financial closure for our projects,

our commitment to quality and our operational expertise. In addition, as an early mover in the shopping center

industry in India, as evidenced by Treasure Island-Indore being among one of the first 10 shopping centers in

existence in India, as well as the first shopping center in an emerging city in India, our association with retailers

began in the early days of organized retail in India. (Source: The Franchising World, November 2008) We are a

member of the International Council of Shop Centers and we have grown with the retail industry and have been

actively involved in forums, events and conferences on organized retail in India and outside India, which we believe

has fostered confidence in us among retailers. We have strong relationships with large retail brands, including the

Pantaloon Group, which occupies 0.10 million square feet at Treasure Island-Indore, 0.21 million square feet at

Treasure Central-Indore and 0.03 million square feet at Treasure Bazaar-Nanded, and has committed to occupy 0.36

million square feet in our Ongoing Projects. Other large retail brands, such as Big Bazaar, E-Zone, Gitanjali,

Spencer and Max have also committed to anchor spaces in our projects under development. We believe that such

relationships help us in securing tenants for our new developments.


All of our retail properties and projects are strategically located in city centers and high growth corridors of the cities

in which they are developed. As one of the first developers of a shopping center in an emerging city, we have been

recognized by the market as an early mover in the shopping center industry in fast growing and emerging cities of

India. (Source: The Franchising World, November 2008) We believe that many of our projects enjoy the status of

being either the first shopping center of the city in which it is located or the largest shopping center in the city

center. We believe that this has helped us to become one of the preferred shopping center partners for major retailers

in India.

In addition, we have a successful track record in the execution of projects, including opening the projects on the

projected timelines. We presently have three operational shopping centers, with four additional projects expected to

open by the end of the financial year 2011. With the completion of our Ongoing Projects, we are expected to

become one of the largest shopping center owners focused on fast growing and emerging cities in the country by the

end of financial year 2012. (Source: “Retail off the Beaten Track,” January 10, 2010, Jones Lang LaSalle Meghraj)


Our position as a successful real estate developer is largely due to our execution capabilities, which we have

demonstrated with the successful and timely completion and the quality of operation and management of Treasure

Island-Indore, Treasure Central-Indore and Treasure Bazaar-Nanded, as well as the launches of the Treasure Town

and Treasure Vihar projects in Indore (at AB Road and Rangawasa) and Udaipur (at Kharol Colony). We believe

that we are one of the few developers in India that has the range of skills required to develop and operate a shopping

center, including construction, interiors, fit-outs, mechanical, engineering and plumbing (“MEP”) services, design

and project management. We have accomplished this by primarily developing organically and acquiring separate

businesses that fulfill these functions.

Through Treasure World Developers Private Limited (“TWDPL”), our construction company, civil contracts across

most of our projects are undertaken through a documented tendering system by the project-specific SPV. In

addition, we subscribed to 51.00% interest in Intesys Technologies Private Limited (“Intesys”), a Delhi based

interior and fit-out specialist company, to ensure that the fit-outs of our projects are carried out in a timely manner,

as well as at a competitive cost, as each project-specific SPV follows a transparent tendering system for awarding

fit-out contracts. Intesys is a fit-out specialist in India that has the ability to undertake the entire chain of work

80

required for fitting out a shopping center, including all elevational features, inside flooring, railings, false ceilings

and glazing. We also have our own MEP design company, Treasure MEP Services Private Limited (“TMEP”),

which is responsible for designing the MEP drawings and choosing the vendors and contractors for the MEP

services for all of our projects. Finally, we act as the project manager for all of our projects, which allows us to

closely monitor quality and costs.


We have an experienced, qualified and dedicated management team, many of whom individually have over 15 years

of experience in their respective fields. We were one of the first real estate developers to build a modern shopping

center in central India, Treasure Island-Indore, which we completed on schedule and within budget. We believe our

operational properties illustrate our management‟s capability to deliver high quality projects in a highly competitive

business, secure financing and execute complex projects on time. For example, Treasure Island-Indore was

completed six months ahead of its scheduled completion date while meeting all specifications and requirements,

which we believe signifies the strength of our management in executing complex projects in new markets. All of

these properties have required attracting a number of anchor tenants and obtaining significant financing from a

number of institutional lenders. In addition, our brand name and reputation for project execution, have assisted us in

recruiting and retaining qualified management and employees. We also provide our staff with competitive

compensation packages and a corporate environment that encourages responsibility, autonomy and innovation. We

believe that the experience of our management team and its in-depth understanding of the real estate market in India

will enable us to take advantage of both current and future market opportunities.

Strategies

Our business strategy consists of the following principal elements:

Focus on “TREASURE” branded development projects in city-centric locations across India

We are committed to developing a large portfolio of retail projects and residential township projects under the

“TREASURE” brand wherein a consumer can relate to similar experiences across all our properties in India. We

have developed three formats for shopping centers and two formats for residential townships. The three formats are

differentiated on the basis of size of the shopping centers, the type of retailers and other facilities, including hotels,

multiplex cinemas and other entertainment venues and commercial space available at the development. We are also

developing residential townships, which are divided into two formats, “Treasure Town” and “Treasure Vihar”. As

of March 31, 2010, our retail and hospitality projects that are part of our Ongoing Projects include a Treasure

Market City in Indore, Treasure Island projects in Raipur, Jabalpur, Bhilai and Mohali and Treasure Bazaar projects

in Ujjain, Amaravati and Baroda. We are also developing Treasure Town and Treasure Vihar projects in Indore and

Udaipur. Our Forthcoming Projects include a retail and hospitality project in Thiruvananthapuram and residential

township projects in Indore (at Kanadia) and Raipur (at Samta Colony). Since most of our retail and hospitality

projects are developed in city center locations in fast growing and emerging cities, we envision our retail

developments as being the city center itself and becoming landmark destinations of the city. We aim to make

“TREASURE” a brand synonymous with quality and best management practices at viable rents across fast growing

and emerging cities in India.

Continue to develop projects in fast growing and emerging cities where we believe we are one of the dominant

organized retail, hospitality and residential developer

We will continue to focus on our strategy of developing shopping centers and residential townships in fast growing

and emerging cities in India where we typically enjoy an early-mover advantage, where we enjoy being the

dominant organized retail developer and where we believe there is significant growth potential. We believe that a

number of underlying factors will continue to provide India‟s retail sector with good growth prospects including,

favorable demographics, with two thirds of India‟s population below the age of thirty-five, continuing urbanization,

especially in emerging cities in which our projects are concentrated, India‟s economy continuing to grow steadily

and a growing middle class. We aim to be the largest shopping center owner and operator in fast growing and

emerging cities in India. We believe that our “TREASURE” brand is gaining in reputation and is recognized by

81

retailers as the first choice in these cities. (Source: “Retail off the Beaten Track,” January 10, 2010, Jones Lang

LaSalle Meghraj)

Focus on performance and project execution

We believe that we have developed a reputation for good quality construction projects and completing projects

ahead of schedule. For example, Treasure Island-Indore was completed in 21 months, six months ahead of schedule,

as a result of our efficient management practices and close collaboration with third party contractors on the project.

As of March 31, 2010, we have 11 Ongoing Projects aggregating 18.27 million square feet of Developable Area. We

intend to continue to focus on performance and project execution in order to maximize client satisfaction. We will

continue to leverage the capabilities of our subsidiary service companies, including TWDPL, a construction

company, Intesys, a fit-out company, TMEP, a MEP design company, as well as our in-house project management

services, to ensure that all of our projects are completed on time and within the budgeted cost.

Focus on shopping center management

We have developed our shopping center management expertise by successfully managing our three operational retail

properties, which we believe are managed in accordance with international standards. With respect to all of our

shopping center projects, we expect we will enter into management contracts with each of the project-specific SPVs.

We will continue to manage our retail developments with the knowledge that there is a distinct difference between

property management and shopping center management. While most shopping center developers operate under the

premise that shopping center management comprises housekeeping, security and maintenance, we believe that these

elements contribute a small fraction of the total activities required to successfully manage a shopping center.

Accordingly, we will continue to focus on creating the optimal tenant mix and adhering to high operational

standards at each of our developments, which we believe will lead to higher consumption rates. With higher

consumption rates (which translates to higher turnover for our tenants), we expect to command competitive lease

rates from our tenants and higher revenues from our revenue sharing contracts.

Develop the “Treasure Showcase” concept

In order to tap into the customer base of the large number of Indian brand manufacturers operating in unorganized

multi-brand outlets across India, we have recently launched the concept “Treasure Showcase” at Treasure Island-

Indore. Treasure Showcase is a “shop-in-shop” seamless concept which will provide Indian non-mall brands a

platform to showcase and sell their products in our shopping centers in categories such as apparel, footwear,

electronics, food, accessories, cosmetics, jewellery, home furnishings and appliances based on a revenue sharing

arrangement. Our aim is not only to expand the number of retailers in the organized sector, but also to convert non-

shopping center customers who shop at multi-brand outlets into shopping center customers. Under the terms of our

Treasure Showcase revenue sharing arrangements, we provide our retail partners space of approximately 15,000

square feet to 50,000 square feet and operating services such as billing and shopping administration. We typically

purchase the products from our Treasure Showcase partners and pay for the products once a customer has purchased

the partner‟s product. Products which we have purchased but were not sold are returned to the partner at no cost to

us. In return for providing our Treasure Showcase partners with retail floor space, we receive approximately 35.00%

to 40.00% of the revenues from sales of our retail partner‟s products, as negotiated on a case-by-case basis. We

expect that this model will enable us to cover our operational costs, increase footfall and provide customers with

differentiated choices in our shopping centers. We intend to launch 19 additional Treasure Showcases by the end of

the financial year 2013, 12 of which will be located in our own shopping centers and seven of which will be located

in the shopping centers of other developers, mainly projects developed by PML.

Continue to utilize effective development and ownership structures to optimize resources

We will continue to utilize project-specific SPVs and project-specific equity financing from investors, which will

assist us in reducing our working capital investment and diversifying our risk. Although we intend to own and lease

our projects under development, this model provides us with the flexibility to strategically exit any particular

property or project by selling our interest in such property or project where we believe an absolute sale or perpetual

leases will provide us with more favorable returns.

82

Description of Our Business

We operate two shopping centers in Indore and a shopping center in Nanded and we are developing urban city

shopping centers in fast growing and emerging cities in India under the brand name “TREASURE”, which we

intend to own and operate upon completion. We are also developing residential townships in fast growing and

emerging cities, which we intend to manage upon completion. Our shopping centers are divided into three formats,

“Treasure Market City,” “Treasure Island” and “Treasure Bazaar” and our residential townships are divided into two

formats, “Treasure Town” and “Treasure Vihar”.

Completed Projects

We have completed the development of three shopping centers, including Treasure Island-Indore, Treasure Central-

Indore and Treasure Bazaar-Nanded. The following table provides key information with respect to our Completed

Projects:

Project Developable

Area (in

million

square feet)

Leaseable

Area (in

million

square

feet)

Leaseable

Area

Leased as

of March

31, 2010

(in million

square

feet)

Project

Cost (Rs.

in

millions)

Our Equity

Interest in the

Project-

Specific SPV as

per

Shareholders‟

Agreement

Our

Equity

Interest

in the

project-

specific

SPV as of

March

31, 2010*

Completion

Date

Treasure

Island-

Indore

0.65 0.45 0.44 1,110.00 100.00% 100.00% December

2005

Treasure

Central-

Indore

(Treasure

Bazaar)

0.48 0.33 0.33 905.00 50.00% 50.00% May 2009

Treasure

Bazaar-

Nanded

0.38 0.25 0.21 711.00 75.00% 75.20% January

2010

*Based on funds contributed to the project-specific SPV as of March 31, 2010.

Treasure Island-Indore

We currently own and operate Treasure Island-Indore, which opened in December 2005. Treasure Island-Indore is

situated in Indore, Madhya Pradesh along M. G. Road and is currently one of the largest shopping centers in central

India. (Source: The Franchising World, November 2008) This project comprised 0.65 million square feet of

Developable Area and 0.45 million square feet of Leaseable Area. Treasure Island-Indore includes 0.28 million

square feet of retail space, 0.05 million square feet of entertainment space (including a multiplex and other

entertainment facilities), 0.03 million square feet of food and beverage space, 0.08 million square feet of hospitality

space and 0.01 million square feet of commercial space. The shopping center is currently anchored by retailers such

as Big Bazaar, Pantaloon, Max, Nike and E-Zone, a five-screen multiplex cinema by PVR, a food court and a

number of restaurants, including Rajdhani, McDonalds, Pizza Hut and Barista. Treasure Island-Indore also includes

a four-star hotel under a leave and licence agreement for a period of 29 years.

The shopping center also provides parking space of 0.18 million square feet. Treasure Island-Indore won the “Most

Admired Shopping Centre – Tier II Cities” in 2008 and “Most Admired Shopping Centre – Mini Metros” awards in

2008, 2009 and 2010 by ISCA, “Best Retailer Award” by the India Franchise Association in 2009 and “Best

Designed Shopping Mall of India” by the CNBC – CRISIL Real Estate Awards in 2007. The total cost of the project

was Rs.1,110.00 million, which was financed by Rs.255.00 million of equity and Rs.855.00 million of debt.

83

For the financial years 2010 and 2009, revenues from our operations at Treasure Island-Indore were Rs.266.68

million and Rs.248.35 million, respectively.

Treasure Central-Indore

We currently operate Treasure-Central Indore, which opened in May 2009 and is situated at RNT Marg, central

Indore, Madhya Pradesh. This project comprised 0.48 million square feet of Developable Area and 0.33 million

square feet of Leaseable Area. As per the project-specific SPV shareholders‟ agreement, we hold a 50.00% equity

interest in Naman Mall Management Company Limited, the project-specific SPV that implemented the project, with

the balance held by Kshitij Venture Capital Fund. Treasure Central-Indore includes 0.23 million square feet of retail

space (including retail anchor tenants such as Pantaloon), 0.04 million square feet of entertainment space (including

a multiplex cinema) and 0.01 million square feet of food and beverage space. Treasure Central-Indore also includes

0.05 million square feet of saleable commercial space.

As at March 31, 2010, the total cost of the project was Rs.905.00 million, which was financed by Rs.311.00 million

of equity capital and reserves (except profit and loss), Rs.543.00 million of debt and Rs.51.00 million of internal

accruals and security deposits.

For the 11 month period ended March 31, 2010, our share of the revenue from Treasure Central-Indore was

Rs.75.05 million.

Treasure Bazaar-Nanded

We currently own and operate Treasure Bazaar-Nanded, which was completed in January 2010 and is situated at

Latur Road, central Nanded, Maharashtra. This project comprised 0.38 million square feet of Developable Area and

0.25 million square feet of Leaseable Area. As per the project-specific SPV shareholders‟ agreement, we hold a

75.00% equity interest in Nanded Treasure Bazaar Private Limited, the project-specific SPV that implemented the

project. Treasure Bazaar-Nanded includes 0.13 million square feet of retail space (including retail anchor tenants

such as Gitanjali and Big Bazaar), 0.04 million square feet of entertainment space (including a multiplex cinema by

PVR and other entertainment facilities), and 0.01 million square feet of food and beverage space. Treasure Bazaar-

Nanded also includes 0.02 million square feet of commercial space and a 0.05 million square foot hotel.

As at March 31, 2010, the total cost of the project was Rs.711.00 million, which was financed by Rs.60.00 million

of equity capital and reserves (except profit and loss) and Rs.651.00 million of debt.

For the three month period ended March 31, 2010, revenues from our operations at Treasure Bazaar-Nanded were

Rs.13.85 million.

Ongoing Retail and Hospitality Projects

We are in the process of developing a Treasure Market City project in Indore, Treasure Island projects in Raipur,

Jabalpur, Bhilai and Mohali, and Treasure Bazaar projects in Ujjain, Amaravati and Baroda, in which our Company

will hold an interest through its subsidiaries and project-specific SPVs. The following table provides key

information with respect to our retail and hospitality projects that are part of our Ongoing Projects:

84

Project Developable

Area (in

million

square feet)

Leaseable

Area (in

million

square

feet)

Leaseable

Area

Leased as

of March

31, 2010

(in

million

square

feet)

Approximate

Project Cost

(Rs. in

millions)

Our Equity

Interest in the

Project-

Specific SPV

as per

Shareholders‟

Agreement

Our

Equity

Interest

in the

Project-

Specific

SPV as

of

March

31,

2010*

Estimated

Completion

Date

Treasure Market City Project

Treasure

Market

City-

Indore

3.00 2.02 0.16 5,015.00 56.10% 57.09% June 2012

Treasure Island Projects

Treasure

Island-

Raipur

1.04 0.83 0.51 2,227.00 67.00% 68.35% March 2011

Treasure

Island-

Jabalpur

0.68 0.46 0.23 1,365.00 51.80% 52.73% March 2011

Treasure

Island-

Bhilai

0.69 0.52 0.24 1,416.00 17.00% 17.51% March 2011

Treasure

Island-

Mohali

0.80 0.51 0.05 1,787.00 51.00% 52.53% January

2012

Treasure Bazaar Projects

Treasure

Bazaar-

Ujjain

0.37 0.29 0.19 683.00 100.00% 100.00% September

2010

Treasure

Bazaar-

Amaravati

0.28 0.22 - 505.00 100.00% 100.00% March 2012

Treasure

Bazaar-

Baroda

0.38 0.26 - 631.00 51.00% 51.00% September

2012

*Based on funds contributed to the project-specific SPV as of March 31, 2010.

Treasure Market City-Indore

We are currently developing Treasure Market City-Indore, which is expected to comprise 3.00 million square feet

(including 1.03 million square feet of parking) of Developable Area and 2.02 million square feet of Leaseable Area

in the center of Indore. As per the project-specific SPV shareholders‟ agreement, we will hold a 56.10% equity

interest in Indore Treasure Market City Private Limited, the project-specific SPV that is implementing the project,

with the balance being held between K2C Residential Limited and, Weser River Limited which is owned by MPC

Synergy Limited.

As of March 31, 2010, we have commitments in the form of letters of intent with security deposits for the lease of

0.16 million square feet, which represents 7.90% of the total Leaseable Area (including retail anchor tenants such as

Max and Gitanjali). We plan to enter into an agreement with a hotel operator for the operation of the hotel located in

the project.

85

The land for this project has been acquired by Indore Treasure Market City Private Limited, and permits

commensurate with the stage of development and construction have been obtained, including environmental

clearance, town and country planning approval and construction permission from Indore Municipal Corporation. Out

of the total Developable Area of 3.00 million square feet, civil construction of 1.07 million square feet was

completed as of March 31, 2010.

We expect that the total development costs (including land and construction costs) for this project will be

Rs.5,015.00 million, of which we expect Rs.1,994.00 million will be contributed to the project-specific SPV in the

form of equity. As of March 31, 2010, Rs.1,514.53 million in equity capital and reserve (except profit and loss) has

been contributed to the project-specific SPV. Rs.2,818.00 million will be secured through debt financing and

Rs.203.00 million will be financed through internal accruals and security deposits. As of March 31, 2010, we have

received sanctions for secured debt financing of Rs.1,650.00 million. The total capital incurred on this project

(defined as total assets including current assets less current liabilities less cash and bank balances) as on March 31,

2010 was Rs.1,748.07 million. We expect to open the first phase of Treasure Market City-Indore, which is expected

to comprise 0.97 million square feet of Gross Leaseable Area by June 2011, and complete the project by June 2012.

Treasure Island-Raipur

We are currently developing Treasure Island, Raipur, which is expected to comprise 1.04 million square feet of

Developable Area and 0.83 million square feet of Leaseable Area in the center of Raipur. As per the project-specific

SPV shareholders‟ agreement, we will hold a 67.00% equity interest in Raipur Treasure Island Private Limited, the

project-specific SPV that is implementing the project, with the balance being held by Diemel River Limited owned

by MPC Synergy Limited.


0.51 million square feet, which represents 61.40% of the total Leaseable Area (including retail anchor tenants such

as Max). We plan to enter into an agreement with a hotel operator for the operation of the hotel located in the

project.

The land for this project has been acquired by Raipur Treasure Island Private Limited and permits commensurate

with the stage of development and construction have been obtained, including environmental clearance, town and

country planning approval and construction permission from the Raipur Town and Country Planning Department.

Out of the total Developable Area of 1.04 million square feet, civil construction of 0.94 million square feet was

completed as of March 31, 2010.


Rs.2,227.00 million, of which we expect Rs.847.00 million will be contributed to the project-specific SPV in the

form of equity. As of March 31, 2010, Rs.645.20 million in equity capital and reserve (except profit and loss) and

Rs.33.13 million in unsecured debt financing have been contributed to the project-specific SPV. Rs.1,291.00 million

will be secured through debt financing and Rs.89.00 million will be financed through internal accruals and security

deposits. As of March 31, 2010, we have received sanctions for secured debt financing of Rs.900.00 million. The

total capital incurred (defined as total assets including current assets less current liabilities less cash and bank

balances) on this project as on March 31, 2010 was Rs.1,323.57 million. We expect to open Treasure Island-Raipur

by March 2011.

Treasure Island-Jabalpur

We are currently developing Treasure Island-Jabalpur, which is expected to comprise 0.68 million square feet of

Developable Area and 0.46 million square feet of Leaseable Area in the center of Jabalpur. As per the project-

specific SPV shareholders‟ agreement, we will hold a 51.80% equity interest in Jabalpur Treasure Island Private

Limited, the project-specific SPV that is implementing the project, with the balance being held by Emmer River

Limited and Baljinder Singh Khanna.



86

as Max). We plan to enter into an agreement with a hotel operator for the operation of the hotel located in the

project.

The land for this project has been acquired by Jabalpur Treasure Island Private Limited and permits commensurate


country planning approval and construction permission from Jabalpur Municipal Corporation. Out of the total

Developable Area of 0.68 million square feet, civil construction of 0.50 million square feet was completed as of

March 31, 2010.




Rs.6.00 million in unsecured debt financing have been contributed to the project-specific SPV. Rs.810.00 million


deposits. As of March 31, 2010, we have received sanctions for secured debt financing of Rs.660.00 million. The


balances) on this project as on March 31, 2010 was Rs.819.26 million. We expect to open Treasure Island-Jabalpur

by March 2011.

Treasure Island-Bhilai

We are currently developing Treasure Island-Bhilai, which is expected to comprise 0.69 million square feet of

Developable Area and 0.52 million square feet of Leaseable Area in the center of Bhilai. As per the project-specific

SPV shareholders‟ agreement, we will hold a 17.00% equity interest in Surya Treasure Island Private Limited, the

project-specific SPV that is implementing the project, with the balance being held by Fliede River Limited,

Edelweiss Trustee Services Private Limited and Shiraj Traders Private Limited.



as Big Bazaar, Pantaloon, Max and Gitanjali). We plan to enter into an agreement with a hotel operator for the

operation of the hotel located in the project.

The land for this project has been acquired by Surya Treasure Island Private Limited and most of the permits


clearance and town and country planning approval. We have applied for a renewal of our construction permit for the

land, which expired on April 23, 2009. Out of the total Developable Area of 0.69 million square feet, civil

construction of 0.52 million square feet was completed as of March 31, 2010.



form of equity. As of March 31, 2010, Rs.475.20 million in equity capital and reserve (except profit and loss) has

been contributed to the project-specific SPV. Rs.850.00 million will be secured through debt financing and Rs.58.00

million will be financed through internal accruals and security deposits. As of March 31, 2010, we have received

sanctions for secured debt financing of Rs.570.00 million. The total capital incurred (defined as total assets

including current assets less current liabilities less cash and bank balances) on this project as on March 31, 2010 was

Rs.615.96 million. We expect to open Treasure Island-Bhilai by March 2011.

Treasure Island-Mohali

We are currently developing Treasure Island-Mohali, which is expected to comprise 0.80 million square feet of

Developable Area and 0.51 million square feet of Leaseable Area in the center of Mohali. As per the project-specific

SPV shareholders‟ agreement, we will hold a 51.00% equity interest in Chandigarh Treasure Island Private Limited,

the project-specific SPV that is implementing the project, with the balance being held by Ochtum River Limited.

87


0.05 million square feet, which represents 9.80% of the total Leaseable Area.

The land for this project has been acquired by Chandigarh Treasure Island Private Limited and all permits


clearance, town and country planning approval and construction permission from Chandigarh, Punjab. Out of the

total Developable Area of 0.80 million square feet, civil construction of 0.06 million square feet was completed as of

March 31, 2010.




Rs.3.20 million in unsecured debt financing have been contributed to the project-specific SPV. Rs.1,071.00 million


deposits. As of March 31, 2010 we have received sanctions for secured debt financing of Rs.1,000.00 million. The


balances) on this project as on March 31, 2010 was Rs.614.45 million. We expect to open Treasure Island-Mohali

by January 2012.

Treasure Bazaar-Ujjain

We are currently developing Treasure Bazaar-Ujjain, which is expected to comprise 0.37 million square feet of

Developable Area and 0.29 million square feet of Leaseable Area in the center of Ujjain. As per the project-specific

SPV shareholders‟ agreement, we will hold a 100.00% equity interest in Ujjain Treasure Bazaar Private Limited, the

project-specific SPV that is implementing the project.



as Big Bazaar, Max and Gitanjali).

The land for this project has been acquired by Ujjain Treasure Bazaar Private Limited and permits commensurate


country planning approval and construction permission from Ujjain Municipal Corporation. Out of the total

Developable Area of 0.37 million square feet, civil construction of 0.35 million square feet was completed as of

March 31, 2010.

We expect that the total development costs (including land and construction costs) for this project will be Rs.683.00

million, of which we expect Rs.258.00 million will be contributed to the project-specific SPV in the form of equity.

As of March 31, 2010, Rs.3.25 million in equity capital and reserve (except profit and loss) and Rs.218.25 million in

unsecured debt financing have been contributed to the project-specific SPV. Rs.399.00 million will be secured

through debt financing and Rs.26.00 million will be financed through internal accruals and security deposits. As of

March 31, 2010 we have received sanctions for secured debt financing of Rs.250.00 million. The total capital

incurred (defined as total assets including current assets less current liabilities less cash and bank balances) on this

project as on March 31, 2010 was Rs.452.39 million We expect to open Treasure Bazaar-Ujjain by September 2010.

Treasure Bazaar- Amaravati

We are currently developing Treasure Bazaar- Amaravati, which is expected to comprise 0.28 million square feet of

Developable Area and 0.22 million square feet of Leaseable Area in the center of Amaravati. As per the project-

specific SPV shareholders‟ agreement, we will hold a 100.00% equity interest in Amaravati Treasure Bazaar Private

Limited, the project-specific SPV that is implementing the project.

The land for this project has been acquired by Amaravati Treasure Bazaar Private Limited and EWDPL Five Star

Hospitality Private Limited and most permits commensurate with the stage of development and construction have

88

been obtained, including town and country planning approval and construction permission from Amaravati

Municipal Corporation. We plan to commence construction of the project in July 2010.



As of March 31, 2010, Rs.0.10 million in equity and Rs.100.89 million in unsecured debt financing have been

contributed to the project-specific SPV. Rs.299.00 million will be secured through debt financing and Rs.25.00

million will be financed through internal accruals and security deposits. As of March 31, 2010, we have not sought

sanctions for secured debt financing. The total capital incurred (defined as total assets including current assets less

current liabilities less cash and bank balances) on this project as on March 31, 2010 was Rs.100.49 million. We

expect to open Treasure Bazaar- Amaravati by March 2012.

Treasure Bazaar-Baroda

We are currently developing Treasure Bazaar- Baroda, which is expected to comprise 0.38 million square feet of

Developable Area and 0.26 million square feet of Leaseable Area in the center of Baroda. As per the project-specific

SPV shareholders‟ agreement, we will hold a 51.00% equity interest in Marvell Mall Development Company Private

Limited, the project-specific SPV that is implementing the project with the balance being held by Kshitij Venture

Capital Fund, Edelweiss Trustee Services Private Limited and others.

The land for this project has been acquired by Marvell Mall Development Company Private Limited and its

subsidiary, The Baroda Commercial Corporation Limited and we have submitted applications for permits

commensurate with the stage of development and construction, including environmental clearance, town and

country planning approval and construction permission from Baroda Municipal Corporation. We plan to commence

construction of the project in October 2010.





million will be financed through internal accruals and security deposits. As of March 31, 2010 we had not sought

sanctions for secured debt financing. The total capital incurred (defined as total assets including current assets less

current liabilities less cash and bank balances) on this project as of March 31, 2010 was Rs.137.34 million. We

expect to open Treasure Bazaar-Baroda by September 2012.

Ongoing Residential Township Projects

We are in the process of developing two Treasure Towns and two Treasure Vihars in Indore (at AB Road and

Rangawasa) and a Treasure Town and Treasure Vihar in Udaipur (at Kharol Colony), in which our Company will

hold an interest through its subsidiaries and project-specific SPVs. The following table provides key information

with respect to our residential township projects that are part of our Ongoing Projects:

Project Developable

Area (in

million

square feet)

Area

Sold as of

March

31, 2010

(in

million

square

feet)

Approximate

Development

Cost (Rs. in

millions)

Our Equity

Interest in the

Project-Specific

SPV/AoP as per

Shareholders‟

Agreement

Our Equity

Interest in

the Project-

Specific

SPV/AoP as

of March 31,

2010*

Estimated

Completion

Date

Treasure Town

and Treasure

Vihar - Indore

(AB Road)

4.88 0.90 6,891.00 60.00% 60.00% June 2013

Treasure Town 1.27 0.19 1,638.00 51.00% 51.00% December

89

Project Developable

Area (in

million

square feet)

Area

Sold as of

March

31, 2010

(in

million

square

feet)

Approximate

Development

Cost (Rs. in

millions)

Our Equity

Interest in the

Project-Specific

SPV/AoP as per

Shareholders‟

Agreement

Our Equity

Interest in

the Project-

Specific

SPV/AoP as

of March 31,

2010*

Estimated

Completion

Date

and Treasure

Vihar -

Udaipur

2012

Treasure Town

and Treasure

Vihar - Indore

(Rangawasa)

4.88 0.39 4,986.00 51.00% 51.00% December

2013

*Based on funds contributed to the project-specific SPV/AoP as of March 31, 2010.

Treasure Town and Treasure Vihar-Indore (AB Road)

We are currently developing a Treasure Town and a Treasure Vihar in Indore at AB Road, which is expected to

comprise a total of 4.88 million square feet of Developable Area across both of the projects. As per the project-

specific SPV shareholders‟ agreement, we will hold a 60.00% equity interest in Indore Treasure Town Private

Limited, the project-specific SPV that is implementing the projects, with the balance being held by K2C Residential

Limited.

As of March 31, 2010, we have received advance bookings for the sale of 0.90 million square feet, which represents

18.44% of the total Developable Area of the two projects.

The land for the projects have been acquired by Indore Treasure Town Private Limited and its SPVs, Pune

Entertainment World Developers Private Limited and Entertainment World Developers Bijalpur Private Limited,

and most permits commensurate with the stage of development and construction have been obtained, including town

and country planning approval and construction permission from Indore Municipal Corporation. We have applied

for environmental clearance from Indore Municipal Corporation and expect to receive clearance by August 2010.

We expect that the total development costs (including land and construction costs) for these projects will be

Rs.6,891.00 million, of which we expect Rs.1,030.00 million will be contributed to the project-specific SPV in the

form of equity. As of March 31, 2010, Rs.1,026.85 million in equity capital and reserve (except profit and loss) has

been contributed to the project-specific SPV. Rs.700.00 million will be secured through debt financing and

Rs.5,161.00 million will be financed through internal accruals and deposits. As of March 31, 2010, we have received

sanctions for secured debt financing of Rs.700.00 million. The total capital incurred (defined as total assets

including current assets less current liabilities less cash and bank balances) on these projects as on March 31, 2010

was Rs.1,311.39 million. We expect to complete the project by June 2013.

Treasure Town and Treasure Vihar, Udaipur

We are currently developing a Treasure Town and a Treasure Vihar in Udaipur at Kharol Colony, which is expected

to comprise a total of 1.27 million square feet of Developable Area across both the projects. As per the project-

specific SPV shareholders‟ agreement, we will hold a 51.00% equity interest in Landmark Treasure Town, an AoP

that is implementing the projects, with the balance being held by Landmark Hi Tech Development Private Limited.


14.96% of the total Developable Area of the two projects.

The land for the projects have been acquired by Dazzling Properties Private Limited, a member of the AoP, and all

permits commensurate with the stage of development and construction have been obtained, including environmental

clearance, town and country planning approval and construction permission from Udaipur Municipal Corporation.

90

Out of the total Developable Area of 1.27 million square feet, civil construction of 0.21 million square feet was

complete as of March 31, 2010.


Rs.1,638.00 million, of which we expect Rs.467.00 million to be contributed to the project-specific SPV in the form

of equity. As of March 31, 2010 Rs.424.49 million has been contributed in equity capital and reserves (except profit

and loss). Rs.250.00 million will be secured through debt financing and Rs.921.00 million will be financed through

internal accruals and deposits. As of March 31, 2010, we have received sanctions for secured debt financing of

Rs.96.30 million. The total capital incurred (defined as total assets including current assets less current liabilities less

cash and bank balances) on these projects as on March 31, 2010 was Rs.466.18 million. We expect to complete the

project by December 2012.

Treasure Town and Treasure Vihar, Indore (Rangawasa)

We are currently developing a Treasure Town and a Treasure Vihar in Indore at Rangawasa, which is expected to


specific SPV shareholders‟ agreement, we will hold a 51.00% equity interest in Wanderland Real Estates Private

Limited, the project-specific SPV that is implementing the projects, with the balance being held by various real

estate investors.


approximately 7.99% of the total Developable Area of the two projects.

The land for the projects have been acquired by Wanderland Real Estates Private Limited and it is currently

submitting applications for permits commensurate with the stage of development and construction, including

environmental clearance, town and country planning approval and construction permission from Indore Municipal

Corporation.


Rs.4,986.00 million, of which Rs.500.00 million will be contributed to the project-specific SPV in the form of

equity. As of March 31, 2010, Rs.5.25 million in equity capital and reserves (except profit and loss) and Rs.449.31

million in unsecured debt financing have been contributed to the project-specific SPV. Rs.250.00 million will be

secured through debt financing and Rs.4,236.00 million will be financed through internal accruals and deposits. As

of March 31, 2010, we have not sought sanctions for secured debt financing. The total capital incurred (defined as

total assets including current assets less current liabilities less cash and bank balances) on these projects as of March

31, 2010 was Rs.489.58 million. We expect to complete the project by December 2013.


Our Forthcoming Projects include a retail and hospitality project, Treasure Island- Thiruvananthapuram, and two

residential township projects, Treasure Town and Treasure Vihar projects in Indore (at Kanadia) and Raipur (at

Samta Colony), in which our Company will hold an interest through its subsidiaries and project-specific SPVs. The

following table provides key information with respect to these Forthcoming Projects:

Project Developable

Area (in

million

square feet)

Estimated

Leaseable/Saleable

Area (in million

square feet)*

Approximate

Project Cost

(Rs. in

millions)

Our Equity

Interest in the

Project-

Specific SPV as

per

Shareholders‟

Agreement

Our

Equity

Interest in

the

Project-

Specific

SPV as of

March 31,

2010#

Estimated

Completion

Date

Treasure Island -

Thiruvananthapuram

0.87 0.75 1,452.00 100.00% 100.00% September

2012

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Project Developable

Area (in

million

square feet)

Estimated

Leaseable/Saleable

Area (in million

square feet)*

Approximate

Project Cost

(Rs. in

millions)

Our Equity

Interest in the

Project-

Specific SPV as

per

Shareholders‟

Agreement

Our

Equity

Interest in

the

Project-

Specific

SPV as of

March 31,

2010#

Estimated

Completion

Date

Treasure Town and

Treasure Vihar -

Indore (Kanadia)

2.26 2.26 2,016.00 100.00% 99.99% June 2013

Treasure Town and

Treasure Vihar –

Raipur (Samta

Colony)

1.93 1.93 1,950.00 33.33% 33.33% October

2013

*The estimated Leaseable/Saleable Area included in this table has been estimated by us on a best case basis and may change. See “Risk Factors - The estimated total Developable Area and Leaseable or Saleable Areas with respect to our Ongoing Projects and Forthcoming Projects are

based on existing real estate regulations and current development plans, and may differ from the actual total Leaseable or Saleable Area once

these projects are complete” on page xxvii of this Draft Red Herring Prospectus. # Based on funds contributed to the project-specific SPV as of March 31, 2010.

Treasure Island-Thiruvananthapuram

We plan to develop a Treasure Island in Thiruvananthapuram, which is expected to comprise 0.87 million square

feet of Developable Area and 0.75 million square feet of Leaseable Area in the center of Thiruvananthapuram. As

per the project-specific SPV shareholders‟ agreement, we will hold a 100.00% equity interest in Annapoorna

Entertainment World Developers Private Limited, the project-specific SPV that is implementing the project.

The land for this project has been acquired by Annapoorna Entertainment World Developers Private Limited and we

plan to submit applications for permits commensurate with the stage of development and construction, including

environmental clearance, town and country planning approval and construction permission in October 2010.

We expect that the total development costs (including land and construction costs) for this project will be Rs.1,452




million will be financed through internal accruals and security deposits. As of March 31, 2010, we have not sought

secured debt financing. The total capital incurred (defined as total assets including current assets less current

liabilities less cash and bank balances) on this project as on March 31, 2010 was Rs.401.89 million. We expect to

complete the project by September 2012.

Treasure Town and Treasure Vihar, Indore (Kanadia)

We plan to develop a Treasure Town and a Treasure Vihar in Indore at Kanadia, which is expected to comprise a

total of 2.26 million square feet of Developable Area across both of the projects. As per the project-specific SPV

shareholders‟ agreement, we will hold a 100.00% equity interest in Treasure World Developers Private Limited, the

project-specific SPV that is implementing the projects.

The land for the projects have been acquired by Treasure World Developers Private Limited and its subsidiaries,

Entertainment World Developers Amritsar Private Limited, Chandigarh Entertainment World Private Limited and

Jodhpur Entertainment World Developers Private Limited, and we plan to submit applications for permits

commensurate with the stage of development and construction, including environmental clearance, town and

country planning approval and construction permission from Indore Municipal Corporation in October 2010.

92



form of equity capital and reserves (except profit and loss). Rs.250.00 million will be secured through debt financing

and Rs.1,304.0 million will be financed through internal accruals and deposits. As of March 31, 2010, we have not

sought debt financing. The total cost incurred on these projects as on March 31, 2010 was Rs.461.54 million. The

following table shows the total cost incurred on this project (defined as total assets including current assets less

current liabilities less cash and bank balances) as on March 31, 2010 by Treasure World Developers Private Limited

and its subsidiaries, Entertainment World Developers Amritsar Private Limited, Chandigarh Entertainment World

Private Limited and Jodhpur Entertainment World Developers Private Limited towards this project:

Project Specific SPVs Cost incurred as of March 31, 2010 (Rs. In

Millions)

Treasure World Developers Private Limited 178.23

Entertainment World Developers Amritsar Private Limited 70.31

Chandigarh Entertainment World Private Limited 104.52

Jodhpur Entertainment World Developers Private Limited 108.48

We expect to complete the project by June 2013.

Treasure Town and Treasure Vihar, Raipur (Samta Colony)

We plan to develop a Treasure Town and a Treasure Vihar in Raipur at Samta Colony, which is expected to


specific SPV shareholders‟ agreements, we will hold a 33.33% equity interest in Ramayana Realtors Private Limited

and 33.33% equity interest in Picasso Developers Private Limited, respectively, the project-specific SPVs that are

implementing the projects, with the balance being held by PML, Sharyans Resources Limited, Pantaloon Fashion

Limited and Kishore M. Gandhi and others.

The land for the projects have been acquired by Ramayana Realtors Private Limited and Picasso Developers Private

Limited and we plan to submit applications for permits commensurate with the stage of development and

construction, including environmental clearance, town and country planning approval and construction permission

from the Raipur Town and Country Planning Department in August 2010.


Rs.1,950.00 million, of which we expect Rs.417.00 million will be contributed to the project-specific SPVs in the

form of equity. As of March 31, 2010, Rs.161.89 million in equity capital and reserves (except profit and loss) and

Rs.33.76 million in unsecured debt financing have been contributed to the project-specific SPVs. Rs.250.00 million

will be secured through debt financing and Rs.1,283.00 million will be financed through internal accruals and

deposits. As of March 31, 2010, we have not sought secured debt financing. The total capital incurred (defined as

total assets including current assets less current liabilities less cash and bank balances) on these projects as of March

31, 2010 was Rs.353.28 million. We expect to complete the project by October 2013.

Retail Properties Lease Structure

We typically enter into three types of lease arrangements with our tenants for our retail properties, fixed-price leases,

fixed-or-percentage of sales leases and percentage of sales leases.

Fixed-price lease. In a typical fixed price lease, a tenant pays rent at a specified price, monthly, for a fixed duration.

The rent a tenant pays is determined using a combination of assessing the prevailing market lease rates of the

shopping center‟s location along with an assessment of the tenant‟s ability to pay the proposed rental rates. All of

our fixed price leases are subject to an industry standard escalation rental increase clause at pre-determined intervals

during the term of the lease.

Fixed-or-percentage of sales lease. A fixed-or-percentage of sales lease, is an arrangement whereby a tenant pays a

base rental fee or additional rental fee based upon a percentage of its sales (whichever is higher); this percentage is

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calculated from the sales made by a tenant on its leased space, at the end of each month of the lease period. The base

rent is typically arrived at by taking into account the ongoing market lease rate for the space which a tenant intends

to occupy and its brand (which is determined by assessing its gross margins, operational expenditure and capital

expenditure levels). For example, if a tenant‟s percentage of sales paid as rental fees is high, the tenant will typically

receive a larger discount on its base rent. If a tenant pays a low percentage of its sales as rental fees, its base rent will

typically be higher.

Percentage of sales lease. The rental fee paid to us under percentage of sales leases are based entirely on the

tenant‟s sales, which is calculated from the sales made by the tenant on its leased space, at the end of each month of

the lease period. This percentage is typically arrived at by analyzing the tenant‟s business category (which is

determined by the sales volume and margin structure of a tenant), the tenant‟s brand (which is determined by

assessing its gross margins, operational expenditure and capital expenditure levels) and the tenant‟s trading density

(which is determined by the ability of the tenant to absorb our rental rates).

As of March 31, 2010, approximately 68.00% of our tenants were on fixed-price leases. The trend in the Indian

retail industry over the past year has been to move towards fixed-or-percentage of sales leases and percentage of

sales leases, which we expect to continue. Over the long term, we expect that the level of retail property tenant sales

will become the most important determinant of revenues of a retail property because a tenant‟s retail sales will

determine the amount of rent, percentage of rent and recoverable expenses (together, the “total occupancy costs”)

that shopping center tenants will be able to afford to pay. In addition, levels of retail property tenant sales can be

considerably more volatile in the short run than total occupancy costs, and may be affected significantly, by the

success or lack of success of a small number of tenants or a single tenant. We believe that the ability of tenants to

pay occupancy costs and earn profits over long periods of time increases as sales per square foot increase, whether

through inflation or real growth in consumer spending. Therefore, under our fixed-or-percentage of sales leases and

percentage of sales leases our tenants‟ sales directly affects the amount of rent we receive under such leases, which

in turn affects our results of operations and financial condition.

We monitor our retail tenants sales who are on fixed-or-percentage of sales leases and percentage of sales leases

through our WIN CORE sales tracking system, which connects to our tenants‟ point of sale terminals. This system

tracks the sales of our tenants which provides us and our tenants with real-time sales data and assists us in

calculating a tenant‟s rent, footfalls, average amount spent and shopper‟s preferences.

Hospitality Properties Lease Structure

We typically enter into fixed-plus-percentage of sales leases for a period of approximately 29 years with our

hospitality tenants for the hotels we develop. The hotel operator pays a base rental fee for the hotel and additional

rental fee based upon a percentage of its sales (usually limited to a specific segment of the hotel‟s business, such as

food and beverage); this percentage is calculated from the sales made by the hotel, at the end of each month of the

lease period. Furthermore, in certain circumstances, if the hotel achieves a certain revenue threshold from its hotel

room bookings, we are entitled to receive 35.00% of the incremental revenue achieved over and above the threshold

level. The base rent is typically arrived at by taking into account the ongoing market lease rate for the hotel. The

percentage of sales we negotiate as a rental fee on fixed-plus-percentage of lease arrangements varies between hotel

operators and depends on various factors including the hotel operator‟s business model and brand.

The Real Estate Development Process

Land identification and acquisition of ownership interests or development rights

To identify land acquisition and development opportunities, we focus on the consumption patterns in the city in

which we are considering developing a project, and whether the consumption patterns of the residents of that city

justify the acquisition and development cost. We also consider whether we will be an early-mover in that city and

whether the proposed project site is located within the city center. In addition, we focus on identifying development

opportunities in fast growing and emerging cities where we believe there is significant growth potential.

94

We have a dedicated team that analyzes and monitors these parameters, as well as industry economics, property

market trends and government policies. We also use the feedback we receive from customers, along with our

relationships with property consultants, constructors, sub-contractors and suppliers, to assess future market demand

and industry outlook. We also undertake extensive market research to identify potential cities where projects can be

launched. This exercise helps us to identify market competition in these locations and assists us in determining the

most appropriate retail mix. After we have identified a potential development site, we evaluate and estimate the

costs which will be incurred for the development of the project. This process is jointly undertaken by our

engineering department and our team which identified the land.

Prior to undertaking each project, we conduct due diligence and assessment exercises in relation to immovable

properties and financial viability of the project. Once we have identified a plot that may be suitable for development,

our local lawyers undertake due diligence investigations in respect of land we desire to develop, including a review

of land records, planning records and ownership records, and publish a notice in newspapers soliciting objections

from persons claiming ownership of the land. Assuming that our investigations show no significant problems with

the identified land, we enter into negotiations pursuant to which we enter into a preliminary agreement with the

landowners to acquire the land. Formal conveyance of land by the seller (at which time stamp duty becomes

payable), for acquisitions of land, is completed shortly before construction is due to start and after all requisite

governmental consents and approvals have been obtained.

Obtaining consents, authorizations and approvals

Once we have identified and entered into an agreement to acquire title to the land, we seek requisite governmental

and regulatory consents, sanctions, authorizations and approvals, including site plan, development plan and

environmental approvals. We have considerable experience in working with governmental and regulatory authorities

to obtain such approvals. This experience has given us a good understanding of the regulatory regime in which we

operate, thereby enabling us to obtain requisite approvals on a timely basis and to obtain approval for the project of

the maximum permitted square footage given for the size of each plot.

Project development and execution

We generally finance the commencement of our projects with equity contributions from our shareholders, security

deposits from customers, internally generated funds from sales revenues, unsecured loans and bank borrowings

secured by the particular project for which funds are being borrowed. Our planning and development team models

the procurement process in conjunction with our finance and accounting teams in order to precisely budget for the

project and assist our sales and marketing team with pricing the project. During this stage, contractors will be

selected, usually through an open tender process. Materials procurement contracts are entered into between our

contractor and the suppliers and large scale equipment such as bulldozers are provided by third party building

contractors. We generally engage our subsidiaries, TWDPL, Intesys and TMEP and other contractors with whom we

have worked on previous developments. In some cases we may enter into turnkey contracts with contractors. These

contracts involve not only construction but also the outsourcing of procurement of the raw materials and labor to

such contractors. In such cases, we still undertake necessary project management and ensure that the execution by

such contractors meets our required standard operating procedures to ensure the uniformity and quality of our

developments.

We typically staff each of our projects with an on-site project manager, civil engineers, surveyors, quality control

officers, sales and marketing personnel, finance and accounting personnel, IT personnel, legal personnel, human

resources personnel and inventory control officers. Our personnel retain all on-site project management and

oversight roles, while construction services are provided.

Marketing, including sales or leasing, and post-completion

With respect to our retail developments, our sales and marketing department is responsible for leasing out the entire

development. Our in-house team approaches this task from the retailer‟s perspective. A viability study is prepared

for key prospective anchor tenants, which includes a summary of the consumption patterns of the city‟s residents

and the projected sales volume of the prospective tenant. This viability study helps us to support our proposed lease

95

rates. The following table identifies our anchor tenants and the amount of square feet leased (including letters of

intent) by each such anchor tenant in our shopping centers as of March 31, 2010.

Name Number of

Anchor Stores

Gross Leaseable Area

Leased by Anchor

(square feet)

Gross Leaseable Area

Leased by Anchor

(square feet) 1

Total Gross Leaseable

Area Occupied by

Anchor (square feet)

Completed Projects Ongoing Projects

Big Bazaar 4 83,687 103,496 187,183

(Pantaloon)

Central 1 213,064 - 213,064

(Pantaloon)

Stellar 1 11,570 - 11,570

E-zone 1 11,451 - 11,451

(Pantaloon)

Pantaloon 2 33,642 31,387 65,029

Spencers 1 - 39,495 39,495

Next 1 8,141 - 8,141

Max 2 32,166 71,840 104,006

Gitanjali 6 9,047 112,878 121,925

Fashion Yatra 1 10,289 - 10,289

Multiplex

PVR 5 53,400 130,289 183,689

FUN 1 - 46,420 46,420

Adlabs 1 - 63,600 63,600

Treasure

Showcase

7 269,089 - 269,089

Total 34 735,546 599,405 1,334,951

1 Includes Letter’s of Intent signed, as of March 31, 2010

Units in our retail developments (not including hotel space, which we pre-lease prior to completion), are leased

around the time of completion of the development. In connection with perpetual leases, we may require that

customers pay advances on the purchase price at the time of entering into the long-term lease agreement.

With respect to residential township projects, our sales and marketing department is responsible for procuring

customers for the units in our developments. Most of our units are sold through word of mouth, but if required, we

market our units through marketing initiatives such as advertisements in newspapers, the internet and billboards,

launch events and corporate presentations. We also engage the services of real estate brokers and selling agents in

connection with the sale of our residential developments. We seek to foster good relations with our customers. In

96

each of our residential developments, we provide our customers with a pre-occupancy inspection accompanied by

our site engineers.

With the exception of hotel developments, we manage all of our properties.

Insurance

We maintain insurance coverage with Indian insurers, such as the New India Assurance Company and

Cholamandalam General Insurance. The insurance that we procure varies with respect to each project and generally

includes coverage for fire and allied perils, contractors‟ all-risk protection and third party liability. We also maintain

insurance coverage for theft from the New India Assurance Company for the products at our Treasure Showcase

outlets. Our operations are subject to hazards inherent in the real estate industry which may cause various losses or

liability and such losses or liability may not be adequately covered by our insurance policies. See “Risk Factors -

Our insurance coverage may not adequately protect us against certain risks to or claims by our employees, and we

may be subject to losses that might not be covered in whole or in part by existing insurance coverage” on page xxix


Competition

The real estate development industry in India, while fragmented and regionalized, is highly competitive. We face

competition from various Indian commercial and retail real estate development companies and shopping centers. In

our retail real estate business we currently face competition from local developers in the cities in which we operate.

In our residential real estate business we currently face competition from Omaxe Limited, Sahara Prime City

Limited, the DLF Group and Parsvnath Developers Limited.

Given our strategy of expanding our business activities in other fast growing and emerging cities, we expect that we

will face competition in the future from various Indian commercial and retail real estate investment and

development companies with significant operations in India. Given the fragmented nature of the real estate

development industry, we often do not have adequate information about the projects our competitors are developing

and accordingly, we run the risk of underestimating supply in the market. Although we intend to focus on fast and

emerging cities where we believe we have an early-mover advantage, we face the risk that some of our competitors,

who are also engaged in real estate development, may be better known in these markets, enjoy better relationships

with land owners and international or domestic joint venture partners, gain early access to information regarding

attractive parcels of land and be better placed to acquire such land. We and certain of our tenants compete with other

retail distribution channels, including department stores and shopping centers, in attracting customers. Moreover, we

compete with an increasing number of commercial real estate developers. In our hotel business, we will compete

with other hotels and service apartments operating in the neighborhood where the hotels are located. Increasing

competition could result in price and supply volatility, which could cause our business to suffer. We may also face

competition in the future from certain foreign real estate development companies operating in India or which may in

the future enter the Indian market.

Employees

As of March 31, 2010, we had 557 employees. Out of these employees, we had 27 employees in engineering, 50 in

accounting and finance, 11 in architecture and design, 65 in shopping center operations and maintenance, 26 in

procurement, 120 in projects, 37 in sales and marketing and others in legal, human resources, administration and

information systems. We believe that a skilled and motivated employee base is essential to maintain our competitive

advantage. None of our employees are represented by any labor or workers‟ unions. We believe that we have good

relations with our employees. Since 1999, when we began our real estate development operations, we have not

experienced any work stoppages or strikes.

Environment, Health and Safety

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We believe that we are generally in compliance with applicable environmental laws and regulations. We are not

currently a party to any environmental proceedings which, if adversely determined, would reasonably be expected to

have an adverse effect on our financial condition or results of operations.

We are committed to complying with applicable health, safety and environmental legislations and other

requirements in our operations. To ensure the effective implementation of our practices, we seek to identify at every

project all potential hazards at the beginning of our work on a project, evaluate the associated risks and institute and

monitor appropriate controls and risk mitigation methods.

We believe that all accidents and occupational health hazards can be prevented through systematic analysis and

control of risks. We encourage our employees to work constantly and proactively towards eliminating or minimizing

the impact of hazards to people and the environment. We encourage the adoption of occupational health and safety

procedures as an integral part of our operations.

Intellectual Property

EWDPL has been registered by us as a trademark under Class 35, 36, 37, 41 and 42 of the Trademark Act, 1999.

The trademarks “TREASURE”, “TREASURE MARKET CITY”, “TREASURE ISLAND”, “TREASURE TOWN”

and “TREASURE BAZAR” and their associated logos are owned by us, and we are the registered owner of the

trademarks. We have applied for registration of other various marks that we use in our business, including “Treasure

Vihar.”

Properties

Our registered office is located at G-16, R. R. Hosiery Building, Shree Laxmi Woolen Mills, Opp. Shakti Mills

Compound, Off. Dr. E. Moses Road, Mahalaxmi, Mumbai 400 011 and our corporate office is located at 6th

Floor,

Treasure Island, 11, M.G. Road, Tukoganj, Indore 452 001, which are owned by us.

Land Reserves

The table below provides certain details of our Land Reserves and estimated Developable Area and

Leasable/Saleable Area as of June 15, 2010:

S.

No

Land Reserves

(Category wise)

Acreage

(in

acres)

% of

total

acreage

Estimated

Developable

Area

(million

sq.ft.)

% of

Developable

Area

Estimated

Leasable/Saleable

Area (million sq.

ft.)

% of

Leasable/Saleable

Area

(i) Land owned by the

Company

1. By itself 0 0.00 0.00 0.00 0.00 0.00

2. Through its

Subsidiaries

10.13 1.73 1.52 6.12 1.06 4.79

3. Through entities

other than (1) and (2)

above

568.85 97.40 22.30 89.77 20.31 91.86

(ii) Land over which the

Company has sole

development rights

1. Directly by the

Company

0 0.00 0.00 0.00 0.00 0.00

2. Through its

Subsidiaries

2.76 0.47 0.37 1.49 0.29 1.31

3. Through entities


0 0.00 0.00 0.00 0.00 0.00

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S.

No

Land Reserves

(Category wise)

Acreage

(in

acres)

% of

total

acreage

Estimated

Developable

Area

(million

sq.ft.)

% of

Developable

Area

Estimated

Leasable/Saleable

Area (million sq.

ft.)

% of

Leasable/Saleable

Area

above

(iii) Land held through

memoranda of

understanding/

agreements to

acquire/ letters of

acceptance and/ or

through agreements

to which its Group

Companies are

parties, of which:

1. Land subject to

government

allocation

0 0.00 0.00 0.00 0.00 0.00

2. Land subject to

private acquisition

2.30 0.39 0.65 2.62 0.45 2.04

(A) Sub-total

(i)+(ii)+(iii):

584.03 100.00 24.84 100.00 22.11 100.00

Joint developments

with partners

(iv) Land for which joint

development

agreements have

been entered into by:

1. By the Company

directly

0 0.00 0.00 0.00 0.00 0.00

2. Through the

Subsidiaries

0 0.00 0.00 0.00 0.00 0.00

3. Through entities


above

0 0.00 0.00 0.00 0.00 0.00

(v) Proportionate

interest in lands

owned indirectly by

the Company through

joint ventures

0 0.00 0.00 0.00 0.00 0.00

(B) Sub-total (iv)+(v): 0.00 0.00 0.00 0.00 0.00 0.00

(C) Total

(i)+(ii)+(iii)+(iv)+(v):

584.03 100.00 24.84 100.00 22.11 100.00

(i) Land Owned by us

Land reserves that we own comprise lands for which sale deeds and other instruments including long-term

lease deeds have been executed and registered in our favour. As of June 15, 2010, the total land owned by

us directly and by our Subsidiaries and other related entities was approximately 578.98 acres representing

99.13% of our total land reserves. Of this, approximately 10.13 acres, representing 1.73% of the land

reserves, is owned through our Subsidiaries. See “Risk Factors - We face uncertainty of title to properties

owned by us or project-specific SPVs that will develop our projects” on page xxii of this Draft Red Herring

Prospectus.

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(ii) Sole Development Rights

As of June 15, 2010, we had been granted sole development rights in respect of approximately 2.76 acres of

land. We acquire sole development rights by entering into agreements with parties having ownership or

other interests over the land. Certain parties granting us development rights may have not yet acquired

ownership rights or title in respect of land that we have categorised as part of our land reserves. As of June

15, 2010, land on which we have been granted sole development rights comprised approximately 0.47% of

our land reserves. Under our agreements relating to sole development rights, upon completion of the

development, we either acquire (a) right, title and interest over 100% of the total developed area of the land

or (b) right, title and interest over a specified proportion of the total developed area of the land or a

specified portion of the gross or net revenue generated from the developed project.

(iii) MoUs/ Agreements to Sell and Purchase/ Letters of Acceptance

As of June 15, 2010, we had been granted rights to acquire and/or develop approximately 2.30 acres of land

pursuant to MoUs/agreements to sell and purchase/letters of acceptance. These land reserves are all subject

to private acquisition and none of our lands are subject to government allocation. These also include land

held by us on the basis of long term lease for a period of 30 years. We generally enter into

MoUs/agreements to sell and purchase/letters of acceptance to acquire and/or develop identified lands.

These MoUs/agreements to sell and purchase/letters of acceptance are expected to be followed by the

execution of definitive agreements, such as sale or lease deeds. At the time of execution of the agreements

to sell and purchase or MoUs for acquisition of land, we make payments of a portion of the total

consideration for the land. Sale or conveyance deeds for such lands are executed after we have conducted

satisfactory due diligence and/or obtained approvals and/or paid the remaining consideration for such land.

At the time of entering into agreements to sell and purchase or MoUs for land to be acquired and/or

developed by us, the vendors or parties seeking to grant us development rights may not have ownership or

title over such land or may have created encumbrances over such land.

(iv) Joint Development Agreements

Under the joint development agreements that we have entered into, the counterparty is typically a land

owner or a person with development rights to the land who grants us permission to develop and sell our

portion of the developed plot in one or several parts but does not convey the title of the land to us. We are

generally required to pay a refundable or non-refundable deposit to the owner of the land and are entitled to

an agreed share of the revenue from the land subject to any restrictions placed on us by the terms of the

agreements entered into. We do not have any land through joint development arrangements.

(v) Joint Venture Arrangements

We do not own any land through joint venture arrangements.

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REGULATIONS AND POLICIES

The following description is a summary of certain laws and regulations, which are relevant for the business. The

information detailed in this chapter has been obtained from publications available in the public domain. The

regulations set out below may not be exhaustive, and are only intended to provide general information to the

investors and are neither designed nor intended to be a substitute for professional legal advice.

We are engaged in business of the development, management, maintenance, selling and leasing of shopping malls,

hospitality, residential, multiplexes, mixed use complexes and commercial, acquisition, office. Since the business of

the Company involves the acquisition of land and land development rights, we are governed by a number of Central

and State legislations regulating substantive and procedural aspects of the acquisition of, and transfer of land as well

as town and city planning. For the purposes of executing the projects, we may be required to obtain licenses and

approvals depending upon the prevailing laws and regulations applicable in the relevant State and/or local governing

bodies such as the Municipal Corporation, the Fire Department, the Environmental Department, the City Survey

Department and the Collector. For details of such approvals, see “Government Approvals” on page 295 of this Draft

Red Herring Prospectus. Additionally, the projects require, at various stages, the sanction of the concerned

authorities under the relevant Central and State legislations and local byelaws.

PROPERTY RELATED LAWS

Central Laws

The Urban Land (Ceiling and Regulation) Act, 1976 (the “Urban Land Ceiling Act”)

The Urban Land Ceiling and Act, prescribes the ceiling on acquisition of vacant urban land by a single entity. It has

however been repealed in some states by the Urban Land (Ceiling and Regulation) Repeal Act, 1999. In states where

the urban land ceiling law is still operative, there are restrictions on the purchase of large areas of land.

The Land Acquisition Act, 1894 (the “Land Acquisition Act”)

Land holdings are subject to the provisions of the Land Acquisition Act which provides for the compulsory

acquisition of land by the Central Government or appropriate State Government for public purposes, including

planned development and town and rural planning. However, any person having an interest in such land has the right

to object to such compulsory acquisition and has the right to compensation. Some states have their own land

acquisition statutes.

Transfer of Property Act, 1882 (the “TP Act”)

The TP Act establishes the general principles relating to transfer of property in India and governs the transfer of

immovable property, except agricultural land. It forms a basis for identifying the categories of property that are

capable of being transferred, the persons competent to transfer property, the validity of restrictions and conditions

imposed on the transfer and the creation of contingent and vested interest in the property. The TP Act also provides

for the rights and liabilities of the vendor and purchaser in a transaction of sale of land.

Registration Act, 1908 (the “Registration Act”)

The Registration Act has been enacted with the objective of providing public notice of the execution of documents

affecting, inter alia, the transfer of interest in immoveable property. The purpose of the Registration Act is the

conservation of evidence, assurances, title, publication of documents and prevention of fraud. It details the

formalities for registering documents. Section 17 of the Registration Act identifies documents for which registration

is compulsory and includes, among other things, any non-testamentary instrument which purports or operates to

create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested

or contingent, in any immovable property of the value of one hundred rupees or more, and a lease of immovable

property for any term exceeding one year or reserving a yearly rent. A document will not affect the property

comprised in it, nor be treated as an evidence of any transaction affecting such property (except as evidence of a

contract in a suit for specific performance or as evidence of part performance under the TP Act or as collateral),

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unless it has been registered. Further, registration of a document does not guarantee title of land. The amount of fees

under the Registration Act for the purpose of registration, vary from State to State.

The Indian Stamp Act, 1899 (the “Stamp Act”)

Stamp duty is payable on instruments evidencing a transfer or creation or extinguishment of any right, title or

interest in immoveable property. Stamp duty needs to be paid on all instruments specified under the Stamp Act at

the rates specified in the schedules to the Stamp Act. Certain states in India have enacted their own legislation in

relation to stamp duty, while other states have amended the Stamp Act, as per rates applicable to in the State.

Instruments chargeable to duty under the Stamp Act, which are not duly stamped, are incapable of being admitted in

court as evidence of the transaction contained therein and it also provides for impounding of instruments that are not

sufficiently stamped or not stamped at all.

The Indian Easements Act, 1882 (the “Easements Act”)

The law relating to easements is governed by the Easements Act An easement is a right which the owner or occupier

of land possesses for the beneficial enjoyment of that land and which permits him to do or to prevent something

from being done, in or upon, other land not his own. Under the Easements Act, a license is defined as a right to use

property without any interest in favour of the lessee. The period and incident may be revoked may be provided in the

license agreement entered in between the licensee and the licensor.

Laws for classification of land user

Usually, land is broadly classified under one or more categories, such as residential, commercial or agricultural.

Land classified under a specified category is permitted to be used only for such specified purpose. In order to use

land for any other purpose, the classification of the land may need to be changed in the appropriate land records by

making an application to the relevant municipal or land revenue authorities. In addition, some State governments in

India have imposed various restrictions, which vary from State to State, on the transfer of property within such

states.

Development of Agricultural Land

The acquisition of land is regulated by State land reform laws, which prescribe limits up to which an entity may

acquire agricultural land. Any transfer of land which results in the aggregate land holdings of the acquirer in the

State to exceed this ceiling is void, and the surplus land is deemed, from the date of the transfer, to have been vested

in the State government free of all encumbrances.

When local authorities declare certain agricultural areas as earmarked for non-agricultural use such as, townships

and commercial complexes, agricultural lands may be acquired by different entities for development. After

obtaining a conversion certificate from the appropriate authority with respect to a change in use of the land from

agricultural to non-agricultural, the ceilings referred to above will not be applicable. While granting licenses for

development of townships, the authorities generally levy proportional development charges for the provision of

services such as laying down of main lines, drainage, sewerage, water supply and electricity, where the authority is

carrying out the same. Such licenses require approvals of layout plans for development and building plans for

construction activities.

Land use planning

Land use planning and its regulation, including the formulation of regulations for building construction, form a vital

part of the urban planning process. Various enactments, rules and regulations have been made by the Central

Government, concerned State governments and other authorised agencies and bodies such as the Ministry of Urban

Development, State land development and/or planning boards, local municipal or village authorities, which deal

with the acquisition, ownership, possession, development, zoning, planning of land and real estate. All relevant

applicable laws, rules and regulations have to be taken into consideration by any person or entity proposing to enter

into any real estate development or construction activity in this sector in India.

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Building Consents

Each State and city has its own set of laws, which govern planned development and rules for construction (such as

floor area ratio or floor space index limits). The various authorities that govern building activities in states are the

Town and Country Planning Department (the “TCPD”), municipal corporations and the Urban Arts Commission.

Any application for undertaking any construction or development activity has to be made to the TCPD, which is a

State level department engaged in the physical planning of urban centres and rural areas in the State.

The municipal authorities regulate building development and construction norms. For example, building plans are

required to be approved by the relevant municipal authority. The Urban Arts Commission advises the relevant State

Government in the matter of preserving, developing and maintaining the aesthetic quality of urban and

environmental design in some states and also provides advice and guidance to any local body with respect to

building or engineering operations or any development proposal which affects or is likely to affect the skyline or the

aesthetic quality of the surroundings or any public amenity provided therein.

Under certain State laws, the local body, before it accords its approval for building operations, engineering

operations or development proposals, is obliged to refer all such operations to the Urban Arts Commission and seek

its approval for the project. Additionally, certain approvals and consents may also be required from various other

departments, such as the Fire Department, the Airports Authority of India and the Archaeological Survey of India.

Urban Development Laws

State legislations provide for the planned development of urban areas and the establishment of regional and local

development authorities charged with the responsibility of planning and development of urban areas within their

jurisdiction. Real estate projects have to be planned and developed in conformity with the norms established in these

laws and regulations made there under and require sanctions from the government departments and developmental

authorities at various stages.

STATE LAWS

Madhya Pradesh

The Madhya Pradesh Housing Development Board Act, 1972 (the “Madhya Pradesh Housing Development

Board Act”)

The Madhya Pradesh Housing Development Board Act provides for the incorporation and regulation of housing

boards in Madhya Pradesh for the purpose of taking measures to deal with and satisfying the need of housing

accommodation. The Madhya Pradesh Housing Development Board Act also includes provisions regarding conduct

of business of board and its committees, the powers of housing board and its chairman.

The Madhya Pradesh Nagar Tatha Gram Nivesh Rules, 1975 (the “Madhya Pradesh Nagar Tatha Gram Nivesh

Rules”)

The Madhya Pradesh Nagar Tatha Gram Nivesh Rules have provisions regarding regional planning, control,

development and use of land. The Madhya Pradesh Nagar Tatha Gram Nivesh Rules also provide for provisions

regarding constitution and functioning town and country development authority.

The Madhya Pradesh Land Development Rules, 1984 (The “LD Rules”)

The LD Rules provide for authorities and powers of land development officers, development of plans and powers of

land development officers in case of violation of land development plans. The LD rules also include provisions

relation to inspection of premises.

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The Madhya Pradesh Griha Nirman Mandal Regulations, 1998 (the “Griha Nirman Regulations”)

The Griha Nirman Regulations provide for provisions regarding appointment, promotion, grant or leave and

punishment of officers and servants of the housing development board. The GNM Regulations also provide for

powers of chairman, housing commissioner and other officers of the board and appointment and functions of

committees.

Guidelines for Joint Venture Projects (the “Joint Venture Guidelines”)

According to the guidelines for Joint Venture projects, in order to meet the basic urban infrastructure requirements,

the Madhya Pradesh Housing Board, in addition to its own efforts, may enter into joint venture partnership with

private developers and landowners for housing schemes or other commercial / infrastructure projects including

swimming pools, fitness clubs, family entertainment centers, multiplexes-shopping malls / hotels etc. and other

educational and health related projects and other similar projects related to housing and other needs of the

population. The JV Guidelines provide basic framework regarding terms and conditions of the aforementioned joint

venture partnerships.

Labour Laws

The employment of construction workers is regulated by a wide variety of generally applicable labour laws. The

company is required to comply with the provisions of the Employee Provision Fund and Miscellanies Provision Act,

1952, the Payment of Gratuity Act, 1972, the Employee State Insurance Act, 1948, the Contract Labour (Regulation

and Abolition) Act, 1970, the Minimum Wages Act, 1948, the Payment of Bonus Act, 1965, the Building and Other

Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, the Payment of Wages

Act, 1936 and Workmen (Regulation of Employment and Condition of Service) Act, 1979.

Environment Laws

Environmental Regulation

The three major statutes in India, which seek to regulate and protect the environment against pollution, related

activities in India are the Water (Prevention and Control of Pollution) Act 1974, the Air (Prevention and Control of

Pollution) Act, 1981 and the Environment Protection Act, 1986. The basic purpose of these statutes is to control,

abate and prevent pollution. In order to achieve these objectives, Pollution Control Boards (“PCB”) which are

vested with diverse powers to deal with water and air pollution, have been set up in each State. The PCBs are

responsible for setting the standards for maintenance of clean air and water, directing the installation of pollution

control devices in industries and undertaking investigations to ensure that industries are functioning in compliance

with the standards prescribed. These authorities also have the power of search, seizure, and investigation if the

authorities are aware of or suspect pollution.

In addition, the Ministry of Environment and Forests looks into Environment Impact Assessment (“EIA”). The

Ministry receives proposals for expansion, modernisation and setting up of projects and the impact which, such

projects would have on the environment is assessed by the above mentioned Ministry before granting clearances for

the proposed projects.

REGULATIONS REGARDING FOREIGN INVESTMENT

Foreign Investment Regulations

Foreign investment in the real estate sector is regulated by the relevant provisions of the FDI Manual dated

November 2005 (“FDI Manual”), the Foreign Exchange Management (Transfer of Issue of Security by a person

Resident Outside India) Regulations, 2000 (“FEMA Regulations”), and the relevant Press Notes issued by the

Secretariat for Industrial Assistance, Government of India.

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FDI Manual

Item No. 9 of Annexure II to the said FDI Manual outlines the sectoral caps in relation to „Housing and Real Estate‟.

The said annexure specifies the following as activities under the automatic route in which Investment is permitted

only by NRIs:

1. Development of serviced plots and construction of built up residential premises;

2. Investment in real estate covering construction of residential and commercial premises including business

centres and offices;

3. Development of townships;

4. City and regional level urban infrastructure facilities, including both roads and bridges;

5. Investment in manufacture of building materials, which is also open to FDI;

6. Investment in participatory ventures in (1) to (5) above; and

7. Investment in housing finance institutions, which is also open to FDI as an NBFC.

FEMA Regulations

The FEMA Regulations, states that the investment cap in the real estate on the activities in the „Housing and Real

Estate‟ permits investment to the extent of 100% only by NRIs in the following specified areas:

1. Development of serviced plots and construction of built up residential premises;

2. Investment in real estate covering construction of residential and commercial premises including business


3. Development of townships;

4. City and regional level urban infrastructure facilities, including both roads and bridges;

5. Investment in manufacture of building materials, which is also open to FDI;

6. Investment in participatory ventures in (1) to (3) above; and

7. Investment in housing finance institutions, which is also open to FDI as an NBFC.

However, all other forms of FDI are prohibited in relation to Housing and Real Estate Business.

Consolidated FDI Policy

The law in relation to investment in the real estate sector is provided under the Consolidated FDI Policy.

Under the Consolidated FDI Policy, FDI up to 100% under the automatic route is allowed in „townships, housing,

built-up infrastructure and construction-development projects (which would include, but not be restricted to,

housing, commercial premises, hotels, resorts, hospitals, educational institutions, recreational facilities, city and

regional level infrastructure)‟, subject to the compliance with the following requirements.

(i) Minimum area to be developed under each project is as under:

(a) In case of development of serviced housing plots, a minimum land area of 10 hectares;

(b) In case of construction-development projects, a minimum built up area of 50,000 square meters;

and

(c) In case of a combination project, anyone of the above two conditions would suffice.

(ii) Minimum capitalisation of US$ 10 million for wholly owned subsidiaries and US$ 5 million for joint

ventures with Indian partners. The funds are to be brought in within six months of commencement of

business of the Company.

(iii) Original investment is not to be repatriated before a period of three years from completion of minimum

capitalisation. The investor is to be permitted to exit earlier with prior approval of the Government through

the FIPB. At least 50% of the project must be developed within a period of five years from the date of

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obtaining all statutory clearances. The investor would not be permitted to sell undeveloped plots.

Therefore applicable law only permits investment by an NRI under the automatic route in the „Housing and Real

Estate‟ sector upto 100% in relation to townships, housing, built-up infrastructure and construction-development

projects (which would include, but not be restricted to, housing, commercial premises, hotels, resorts, hospitals,

educational institutions, recreational facilities, city and regional level infrastructure) and additionally permits upto

100 % FDI in the „Housing and Real Estate‟ subject to compliance with the terms provided in the Consolidated FDI

Policy.

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HISTORY AND CERTAIN CORPORATE MATTERS

Brief History of the Company

The Company is involved in the business of owning, developing, managing and operating urban city shopping

centers, develop and sell large scale residential townships, and own, develop and lease hospitality properties in fast

growing and emerging cities in India (i.e., emerging non-metropolitan cities) under the brand name

“TREASURE”.The Company was incorporated as „R.M.M Construction Private Limited‟ under the Companies Act

and a certificate of incorporation dated July 22, 1999 was issued by Registrar of Companies, Madhya Pradesh at

Gwalior. Consequent upon the conversion of the Company to a public limited company, the name of the Company

was changed to „R.M.M Construction Limited‟ on June 29, 2001. Subsequently, the name of the Company was

changed to „Entertainment World Developers Limited‟ and a fresh certificate of incorporation dated June 29, 2001

was issued by Registrar of Companies, Madhya Pradesh and Chhattisgarh. Consequent upon the conversion of the

Company to a private limited company, on February 28, 2003 the name of the Company was changed to

„Entertainment World Developers Private Limited‟. Further, the name of the Company was changed to „EWDPL

India Private Limited‟ and a fresh certificate of incorporation dated April 5, 2007 was issued by Registrar of

Companies, Maharashtra at Mumbai. Subsequently, a fresh certificate of incorporation dated September 2, 2008 was

issued by the Registrar of Companies, Maharashtra at Mumbai for change of name of the Company to

„Entertainment World Developers Private Limited‟. The name of the Company was further changed to

„Entertainment World Developers Limited‟ consequent upon the conversion of the Company to a public limited

company and a fresh certificate of incorporation dated February 5, 2010 was issued by the Registrar of Companies,

Maharashtra at Mumbai.

The Board of Directors noted in its meeting dated June 11, 2010, that the management of the Company may

consider an amalgamation or merger of TWDPL with the Company after one year from the date of allotment of

equity shares being offered in the Issue. Such amalgamation or merger of TWDPL with the Company will be subject

to applicable laws, regulations and guidelines including laws in relation to foreign investment and any approval of

statutory or regulatory authorities as may be applicable, the approval of shareholders, debenture holders and other

parties as required under applicable laws or any agreements entered into by the Company and TWDPL.

Changes in the Registered Office

The details of changes in the Registered Office are set forth below:

Date of Resolution Changes in the address of Registered Office

August 20, 2004 Change in registered office from 11, Tukoganj, Main Road, Indore 452 001, Madhya

Pradesh to 161, Suniket, Srinagar Extension, Khajrana Main Road, Indore 452 018.

March 19, 2006 Change in registered office from 161, Suniket, Srinagar Extension, Khajrana Main Road,

Indore 452 018, Madhya Pradesh to 5/B, Bharat House, 2nd

floor, 104, Mumbai Samachar

Marg, New BSE, Mumbai 400 023

July 15, 2006(1)

Change in registered office from 5/B, Bharat House, 2nd


Marg, New BSE, Mumbai 400 023, Maharashtra to 5th

floor, Phoenix House, Senapati

Bapat Marg, Lower Parel, Mumbai 400 013

July 24, 2008(2)

Change in registered office from 5th

floor, Phoenix House, Senapati Bapat Marg, Lower

Parel, Mumbai 400 013, Maharashtra to G-16, R. R. Hosiery Building, Shree Laxmi

Woolen Mills, Opp. Shakti Mills Compound, Off. Dr. E. Moses Road, Mahalaxmi,

Mumbai 400 011 (1) Change in Registered Office with effect from September 1, 2006. (2) Change in Registered Office with effect from August 1, 2008.

The changes mentioned above were made to enable greater operational efficiency.

Main Objects of the Company

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

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1. To construct, own, acquire, develop, provide, secure, arrange or deal in or manage, run, hire or let out,

sell or lease Family Entertainment Center or Centers for offering all types of comprehensive Entertainment

facilities and/or multiplex, Cineplex, cinema halls, theatres (open air, close), shops, shopping malls,

shopping junctions, or centers providing comprehensive food and beverages facilities, bars, restaurants,

hotels, food courts, eateries, fast food centers or centers providing cultural activities, music and dance

centers, ballets, pantomime, spectacular pieces, promenade, concerts, circus or centers for offering sports

facilities, bowing alleys, pool and billiards, tables or centers offering other kind of entertainment facilities

such as laser tags, carousals, bumper car, virtual reality, simulator rides and theatres, horror trials, safari

adventures, redemption games etc. or centers for club activities, card room, health club swimming pools,

other sports facilities such as table tennis, badminton, squash etc. or centers providing facilities for

banquet halls, holding parties and reception etc. or execute and develop all the above mentioned facilities

or acquire rights for carrying out franchisee or Indian or Foreign Collaborators in the above areas or to

act as an agent for carrying out all the activities or to offer consultancy services in all the areas and/or join

hands with the collaborators, venture partners to achieve the above objectives or to borrow. Monies or

offer equity for attaining the above objects.

2. To carry on the business of builders, constructors, developers, contractors, or otherwise deal in houses,

land, buildings, sheds, or any other property, to carry on the construction or demolition work of any kind to

purchase or otherwise acquire land, houses, offices, workshops, buildings and premises for the purpose of

aforesaid business to purchase, acquire, take on lease or exchange or in any other lawful manner, any

area, land, building, structures, and to dispose of or maintain the same and to build township, markets, or

other buildings, residential or commercial or conveniences thereon and to equip the same or part thereof

with all or any amenities or conveniences, drainage facility, electric, telephone, television installation and

to deal with the same in any manner whatsoever and buy, advance money to and enter into contracts and

arrangements of all kinds with builders, tenants and others.

The main objects as contained in the Memorandum of Association enable the Company to carry on the business

presently carried out as well as business proposed to be carried out and the activities proposed to be undertaken

pursuant to the Objects of the Issue.

Amendments to the Memorandum of Association

Date of shareholders‟

resolution

Nature of Amendment

June 18, 2001 The object clause of the Memorandum of Association was amended to replace the clause

III A (1) with the following clause:

“To construct, own, acquire, develop, provide, secure, arrange or deal in or manage, run,

hire or let out, sell or lease family entertainment center or centers for offering all types of

comprehensive entertainment facilities and/or multiplex, Cineplex, cinema halls, theatres

(open air, close), shops, shopping malls, shopping junctions or centers providing

comprehensive food and beverages facilities, bars, restaurants, hotels, food courts,

eateries, fast food centers or centers providing cultural activities, music and dance

centers, ballets, pantomime, spectacular pieces, promenade, concerts, circus or centers

for offering sports facilities, bowling alleys, pool and billiards, tables or centers offering

other kind of entertainment facilities such as laser tages, carousals, bumper car, virtual

reality, simulator rides and theatres, horror trials, safari adventures, redemption games,

etc, or centers for club activities, card room, health club swimming pools, other sports

facilities such as table tennis, badminton, squash, etc, or centers providing facilities for

banquet halls, holding parties and reception, etc. or execute and develop all the above

mentioned facilities or acquire rights for carrying out franchisee or Indian or foreign

collaborators in the above areas or to act as an agent for carrying out all the activities or

to offer consultancy services in all the areas and/or join hands with the collaborators,

venture partners to achieve the above objectives or to borrow monies or offer equity for

attaining the above objectives.”

June 18, 2001 Consequent upon the conversion of the Company to a public limited company, the name

of the Company was changed to „R.M.M Construction Limited‟ and certificate in this

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resolution

Nature of Amendment

regard was issued by the Registrar of Companies, Madhya Pradesh and Chattisgarh

June 18, 2001 The name of the Company was changed to „Entertainment World Developers Limited‟

and a fresh certificate of incorporation was issued by the Registrar of Companies,

Madhya Pradesh and Chattisgarh

January 24, 2003 The name of the Company was changed to „Entertainment World Developers Private

Limited‟ and a fresh certificate of incorporation was issued by the Registrar of

Companies, Madhya Pradesh and Chattisgarh

July 7, 2003 The object clause of the Memorandum of Association was amended to insert the

following clause:

“To carry on the business of builders, constructors, developers, contractors or otherwise

deal in houses, land, buildings, sheds or any other property, to carry on the construction

or demolition work of any kind to purchase or otherwise acquire land, houses, offices,

workshops, buildings and premises for the purpose of the aforesaid business to purchase,

acquire, take on lease or exchange or in any other lawful manner, any area, land,

building, structures and to dispose of or maintain the same and to build township,

markets or other buildings, residential or commercial or conveniences thereon and to

equip the same or part thereof with all or any amenities or conveniences, drainage

facility, electric, telephone, television installation and to deal with the same in any

manner whatsoever and buy, advance money to and enter into contracts and

arrangements of all kinds with builders, tenants and others.”

July 7, 2003 The initial authorised share capital of Rs. 2,500,000 divided into 250,000 equity shares

of Rs. 10 each was increased to Rs. 100,000,000 divided into 2,092,745 Class A equity

shares of Rs. 10 each with voting rights and 7,907,255 Class B equity shares of Rs. 10

each

January 19, 2004 The authorised share capital of Rs. 100,000,000 divided into 2,092,745 Class A equity

shares of Rs. 10 each with voting rights and 7,907,255 Class B equity shares of Rs. 10

each without voting rights was consolidated into 1,000,000 equity shares of Rs. 100 each

September 30, 2004 The authorised share capital of Rs. 100,000,000 divided into 1,000,000 equity shares of

Rs.100 was increased to Rs. 113,000,000 divided into 1,130,000 equity shares of Rs. 100

each

March 10, 2006 The authorised share capital of Rs. 113,000,000 divided into 1,130,000 equity shares of


each

March 10, 2006 The authorised share capital of Rs. 150,000,000 divided into 1,500,000 equity shares of

Rs.100 was sub-divided into 15,000,000 equity shares of Rs. 10 each

March 10, 2006 The object clause of the Memorandum of Association was amended to insert the

following clause:

“To provide information technology to any person, firm, company, trusts, association,

institution, society, body corporate, government or government department, public or

local authority in India and outside India, in the field of information technology and

related areas and/or to develop procedures, methods, and principles for, and engage in

research relating thereto to carry on the business of designers and manufacturers, buyers,

sellers, assemblers, exporters, importers, distributors, agents, hirers and dealers of and as

maintenance and service engineers, and system engineers, of mainframe, mini, micro and

personal computer systems and process control systems and computer peripherals and

accessories including floppy disk drives, hard disk drives, printers, readers, tape drivers,

cartridge, plotters, magnetic or otherwise, recording heads, CRT terminals and display

systems, cables, interfaces, computer ribbons, stationery, furniture and control valves,

instruments, transducers, recorders, measuring devices and computer hardware including

large systems, mini, micro systems and personal computers and process control systems

and hardware in computer and electronics.”

“To carry on business process outsourcing in Human resources, Finance and accounting

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resolution

Nature of Amendment

Customer relationship management, Employee relocation, Content management,

Procurement outsourcing.”

October 20, 2005 Change in registered office to 5/B, Bharat House, 2nd


Marg, New BSE, Mumbai 400 023, Maharashtra

April 2, 2007 The name of the Company was changed to „EWDPL India Private Limited‟ and a fresh

certificate of incorporation was issued by Registrar of Companies, Maharashtra at

Mumbai.

June 27, 2007 The authorised share capital of Rs. 150,000,000 divided into 15,000,000 equity shares of


each

August 18, 2008 A fresh certificate of incorporation was issued by the Registrar of Companies,

Maharashtra at Mumbai for change of name of the Company to „Entertainment World

Developers Private Limited‟

January 22, 2010 The authorised share capital of Rs. 170,000,000 divided into 17,000,000 Equity Shares

of Rs. 10 each was increased to Rs. 1,000,000,000 divided into 100,000,000 Equity

Shares of Rs. 10 each

January 22, 2010 The name of the Company was further changed to „Entertainment World Developers

Limited‟ consequent upon the conversion of the Company to a public limited company

and a fresh certificate of incorporation was issued by the Registrar of Companies,

Maharashtra at Mumbai

May 12, 2010 The authorised share capital of Rs. 1,000,000,000 divided into 100,000,000 Equity

Shares of Rs. 10 each was increased to Rs. 1,500,000,000 divided into 150,000,000

Equity Shares of Rs. 10 each

Major events of the Company

Date Event

April 2004 Started the construction of the Company‟s first project – Treasure Island, Indore

December 2005 Operationalisation of the Company‟s first project- Treasure Island, Indore

September 2006 Investment of Rs. 164,980,235 in the Company by Ashok Ruia Enterprises Private

Limited (merged with PML) by subscribing to 1,525,194 equity shares

November 2006 Investment of Rs. 755,000,000 by IDBI Trusteeship Services Limited (the merged entity

after its merger with the Western India Trustee and Executor Company Limited) in its

capacity as trustee of India Advantage Fund – III in the Company by subscribing to

7,500,000 optionally convertible debentures of Rs. 100 each and 49,000 equity shares of

Rs. 10 each at a price of Rs. 102.04 per equity share

June 2007 Investment of Rs. 62,740,000 in the Company by Moon Light Developers Private

Limited (merged with PML) by subscribing to 580,013 equity shares

August 2007 Company won the CNBC-CRISIL award for best designed shopping mall

December 2007 Investment of Rs. 106,176,000 in the Company by Moon Light Developers Private

Limited (merged with PML) in the form of Equity Shares

March 2008 Company won Images Shopping Centre Award (ISCA) for most admired shopping centre

(Tier-II) of 2008

May 2009 Operationalisation of the second project- Treasure Central, Indore, being developed by

NMMCPL

August 2009 Launched the residential projects – Indore Treasure Town and Treasure Vihar, being

developed by ITTPL

October 2009 Launched the residential projects - Udaipur Treasure Town and Treasure Vihar, being

developed by Landmark Treasure Town

December 2009 Operationalisation of the third project- Treasure Bazaar, Nanded, developed by NTBPL

December 2009 Launched the residential projects -Indore Fantasy Treasure Town and Treasure Vihar,

being developed by WREPL

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Shareholder Agreements/ Other Key Agreements

1. Securities subscription and shareholders‟ agreement dated November 1, 2006 between the Company,

IAF - III represented by its investment manager, ICICI Venture Funds Management Company

Limited (the “Investor”), Promoters and Ashok Ruia Enterprises Private Limited (merged with

PML) (“AREPL”) (the “Agreement”)

The Company, the Investor, Promoters and AREPL (the “Parties”) entered into the Agreement on

November 1, 2006 in terms of which the Investor subscribed to 49,000 equity shares of Rs. 10 each and 7.5

million optionally convertible debentures of Rs. 100 each aggregating to Rs. 755 million. The Agreement

inter alia provides for various rights, obligations, terms and conditions for regulating the relationship

between the Parties and for managing and operating the Company.

The Agreement provides that the board of directors shall consist of a minimum of four directors and a

maximum of 12 directors. The Promoters and AREPL have a right to nominate five directors whilst the

Investor has a right to nominate two directors. The presence of one nominated director representing each of

the Investor and AREPL or the Promoters is required to constitute a valid quorum. The Investor also has a

right to appoint one non-voting observer to attend meetings of the board of directors or its committees. In

the event a consent vote is required of the director nominated by the Investor under the terms of the

Agreement, such vote will be deemed to be cast only upon obtaining a written approval from the Investor.

Further, the Investor has a right to nominate a director on the board of subsidiaries or SPVs of the

Company as a nominee of the Company, provided that the Company has a right to nominate at least two

directors on the board of such subsidiary or SPV. Any fundamental issues which are to be decided at the

subsidiary or SPV level would require the consent from the nominated director of the Investor.

No discussions or resolutions, pertaining to any fundamental issue or reserved matters as provided in the

Agreement, which require affirmative vote of the Investor shall be taken up at the board meetings unless

the Investor or the representative director of the Investor is present at the meeting or gives his written

approval or a written approval waiving this requirement is provided. The Investor has affirmative voting

rights inter alia in relation to changes in capital structure, any revenue or capital expenditure beyond 10%

of an amount budgeted for, acquisition or disposal of equity shares or property or assets of other businesses,

creation of joint ventures except for those created in the normal course of business, increase, alteration or

reduction of authorised capital and equity and preference paid-up capital, grant of any option or other

interest (in the form of convertible securities or in any other form) over or in its share capital, investment or

divestment of shares of any subsidiary or SPV, changing the rights and preference of securities,

reconstitution of the board of directors, entering into any commitment with any person for an amount

exceeding Rs. 10 million, changes in the business or commencement of new line of business and

commencement or settlement of litigation where the amount involved is more than Rs. 10 million or any

other fundamental issue or reserved matters as provided in the Agreement.

The Promoters have agreed to a non-compete arrangement in relation to the business of the Company. The

Investor also has certain „drag option‟ and „put option‟ rights on the occurrence of an event of default. In

the case, of an event of default under Agreement and the Promoters being unable to fulfil their obligations

under the „put option‟, the Investor has certain rights which include appointment of the managing director

and to control management decisions, cause a sale of assets or business of the Company or a merger,

acquisition or takeover of the Company.

The Parties have agreed that the Company will undertake an initial public offer of Equity Shares within a

period of three years and six months from November 1, 2006 which has been extended up to February 15,

2011 through letters dated January 25, 2010, May 3, 2010 and July 2, 2010. In the event, the Company is

unable to file the draft red herring prospectus with SEBI by July 15, 2010 or to undertake an initial public

offer by February 15, 2011, the Investor inter alia has the right to require the Promoters and/or the

Company to purchase all Equity Shares and optionally convertible debentures and/or redeem all optionally

convertible debentures at a fair value.

In connection with an initial public offer, the optionally convertible debentures (“OCDs”) held by the

111

Investor will be converted into Equity Shares at the lower-end of a prescribed valuation range and allotted

to the Investor. Accordingly, 27,877,016 Equity Shares aggregating to 21.48% of the post-Issue paid up

capital of the Company will be allotted to Investor on conversion of OCDs prior to filing the Red Herring

Prospectus with the RoC. Of, 27,877,016 Equity Shares allotted to the Investor, 11,463,276 Shares (which

was arrived at by computing the difference between the higher-end of the prescribed valuation range and

lower-end of the prescribed valuation range) aggregating to 8.83% of the post-Issue paid up capital of the

Company will be held in escrow by a mutually acceptable bank (“Escrow Equity Shares”). The Investor

shall continue to enjoy all rights and benefits in relation to the Escrow Equity Shares including but not

limited to dividend, voting, rights and bonus. The Escrow Equity Shares shall be released from the escrow

account proportionately to the Promoters and the Investor which will depend on the value realised on sale

of balance Equity Shares by the Investor after the mandatory lock-in period of one year from date of

allotment of Equity Shares in the Issue in accordance with SEBI Regulations (“Lock-In Period”) and the

return on investment calculated as per a prescribed multiple of cost or IRR structure, whichever is higher.

The Promoters and the Investor will enter into an escrow agreement with an escrow agent prior to

conversion of OCDs into Equity Shares.

In the event, the Investor does not sell the balance Equity Shares, the Promoters have the option to notify

the Investor of a reference date (which will be a date six months after the expiry of the Lock-In Period)

which will be used to calculate a deemed exit value for the Investor for purposes of proportionate release of

Escrow Equity Shares as mentioned above, provided certain liquidity thresholds (based on volume of

Equity Shares of the Company traded on the Stock Exchanges) have been met. In the event, the Investor is

unable to exit after three years from the date of completion of the Issue and the Promoters are unable to

give a reference date; the Escrow Equity Shares will be released to the Investor.

The Agreement shall terminate on completion of the initial public offer subject to the Investor having a

right to nominate two directors.

In terms of a letter dated January 25, 2010, the Investor has provided its consent for filing the draft red

herring prospectus, red herring prospectus and the prospectus in relation the proposed initial public offering

and filing of the amended articles of association of the Company and to complete the initial public offer

within nine months from January 25, 2010. Further, in terms of a letter dated May 3, 2010, the Investor has

consented to the filing of the draft red herring prospectus with SEBI by June 30, 2010 and to complete the

initial public offer by January 2011. Further, pursuant to the letter dated July 2, 2010, the Investor has

consented and extended the filing of the draft red herring prospectus with SEBI from June 30, 2010 to July

15, 2010 and to complete the initial public offer by February 15, 2011. In the event that the Company is

unable to file the draft red herring prospectus with SEBI by July 15, 2010 or complete the initial public

offer by February 15, 2011 or any extended period as may be approved by the Investor, the articles of

association will be reinstated with all the rights of the Investor which were prevalent in the articles of

association of the Company prior to its amendment.

2. Letter dated June 18, 2010 from the Promoters to PML and Kalani Holdings Private Limited (a

wholly owned subsidiary of PML)

Promoters have issued a letter dated June 18, 2010 (the “Phoenix Letter”) to PML and Kalani Holdings

Private Limited (a wholly owned subsidiary of PML) (the “Phoenix Group”) in relation to the Phoenix

Group‟s stake in the Company. In terms of the Phoenix Letter, PHPL has undertaken to transfer 1,488,689

Equity Shares and KBIPL has undertaken to transfer 3,129,657 Equity Shares, respectively, aggregating to

4,618,346 Equity Shares to PML for an aggregate consideration of Rs. 1,154,586.50. The transfer of Equity

Shares to PML has been proposed to be undertaken in view of an understanding between the Promoters and

the Phoenix Group, whereby the Promoters had agreed to ensure that the Phoenix Group would hold 33%

of the Equity Share capital of the Company, post conversion of the optionally convertible debentures held

by IAF - III into Equity Shares of the Company and prior to the IPO. The above mentioned transfer of

Equity Shares would be made by PHPL and KBIPL to PML upon the conversion of optionally convertible

debentures held by IAF - III into the Equity Shares and prior to the filing of the Red Herring Prospectus

with the RoC.

112

3. Deed of adherence and modification to the securities subscription and shareholders agreement dated

July 9, 2010 between the Company, the Promoters, IAF - III, Kalani Holdings Private Limited (a

wholly owned subsidiary of PML) (“KHPL”) and PML (the “Deed of Adherence”)

Pursuant to the Deed of Adherence, PML and KHPL have agreed to abide by the obligations under the

Securities Subscription and Shareholders‟ Agreement dated November 1, 2006 (“Agreement”) mutatis

mutantis other than those expressly excluded in the Deed of Adherence. The Promoters had earlier

transferred 1,190,937 equity shares and 824,739 equity shares to KHPL and Ruia Real Estate Development

Company Private Limited (now merged with PML) respectively. Additionally, pursuant to the Phoenix

Letter, the Promoters have agreed to transfer 4,618,346 equity shares to PML (collectively with the equity

shares acquired earlier referred to as “Promoter Sale Shares”). In the event that the obligations under the

Agreement (as specifically provided in the Deed of Adherence) are not fulfilled by the Promoters, IAF - III

shall notify the Promoters, PML and KHPL of such breach. Accordingly, PML and KHPL shall transfer the

Promoter Sale Shares for a nominal consideration of Re. 1 per equity share within 15 days of the receipt of

such notice to the Promoters. Subsequent to the completion of such transfer, PML and KHPL shall no

longer be bound by the terms and conditions under the Agreement and/or the Deed of Adherence. In case

PML and KHPL fail to undertake the transfer of the Promoter Sale Shares within the prescribed time

period, they shall comply with the terms and conditions of the Agreement other than those expressly

excluded in the Deed of Adherence. However, the aggregate liability of PML and KHPL shall be limited to

the fair value of the Promoter Sale Shares as determined by an expert in accordance with the Deed of

Adherence.

It is further agreed that for the purpose of exercise of the affirmative rights on the Promoters Sale Shares,

PML and KHPL has executed an irrevocable power of attorney in favour of IAF – III dated July 9, 2010.

4. Shareholders Agreement dated June 17, 2006 among the Company, Kshitij Venture Capital Fund

(“KVCF”) and Naman Mall Management Company Private Limited (“NMMCPL”) (“the SHA”)

Pursuant to the SHA, the Company and KVCF, the existing shareholders of NMMCPL, have agreed to

increase the authorised share capital of NMMCPL from Rs. 100,000 to Rs. 10,000,000. The Company and

KVCF have subscribed to the equity shares of NMMCPL in the ratio of 50:50. NMMCPL is engaged in the

development and construction of a commercial complex, Treasure Central in Indore. The Company and

KVCF shall also participate in the management of NMMCPL. The Company and KVCF shall have two

directors each on the board of NMMCPL and the managing director shall be nominated by the Company.

Any change of control in the Company or KVCF shall constitute a default and a ground for termination of

the SHA.

Subsidiaries and joint venture

The Company has 29 Subsidiaries and a Joint Venture. For details regarding the Subsidiaries and Joint Venture of

the Company, see “Subsidiaries and Joint Venture” on page 129 of this Draft Red Herring Prospectus.

Promoter

For details, see “Promoters and Promoter Group” on page 149 of this Draft Red Herring Prospectus.

Capital raising activities through equity or debt

For details regarding the capital raising activities of the Company through debt, see “Financial Indebtedness” on


Our Shareholders

For details regarding the shareholders of the Company, see “Capital Structure” on page 26 of this Draft Red Herring

Prospectus.

113

MANAGEMENT

Under the Articles of Association we are required to have not less than three Directors and not more than 12

Directors. We currently have 10 directors on the Board.

The following table sets forth details regarding the Board as of the date of filing the Draft Red Herring Prospectus:

Name, Father‟s Name, Designation,

Address, Term, Occupation, Nationality

and DIN

Age

(Years)

Other Directorships

Manish Kalani

(S/o P. S. Kalani)

Managing Director

Address: 11, Tukoganj, M. G. Road, Indore

452 001

Term: Five years with effect from February

12, 2010

Occupation: Business

Nationality: Indian

DIN: 00169041

41 Other directorships

Flexituff International Limited;

Jabalpur Treasure Island Private Limited;

Raipur Treasure Island Private Limited;

Crystal 3 Power Private Limited;

MRK Pipes Limited;

Four Dimension Properties Private Limited; and

Triple A Real Estates Private Limited.

Partnerships

Nil

Trusteeships

Nil

B. Rajesh Nair

(S/o Ramakrishnan B. Nair)

Executive Director

Address: 302, Shalimar Township, A. B.

Road Opposite Scheme No. 78, Indore 452

010

Term: Liable to retire by rotation

Occupation: Service

Nationality: Indian

DIN: 00061165


Jabalpur Treasure Island Private Limited;

Raipur Treasure Island Private Limited;

Kalani Brothers (Indore) Private Limited; and

Padma Homes Private Limited.

Partnerships

Nil

Trusteeships

Nil

Sudarshan Bajoria (S/o Dr. Viswanath Bajoria)

Non-Independent, Non- Executive Director

appointed as nominee of ICICI Venture

Funds Management Company Limited

Address: Flat no. A- 402, 4th

Floor, Golden


I-Ven Residential Properties (Mumbai) Limited;

I-Ven Kolte-Patil Projects (Pune) Private

Limited;

I-Ven Realty Limited;

Corolla Realty Private Limited;

Kolte-Patil I-Ven Townships (Pune) Private

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and DIN

Age

(Years)

Other Directorships

Square, Sundar Nagar, Kalina Santacruz (E)

Mumbai 400 098


Occupation: Service

Nationality: Indian

DIN: 01853708

Limited;

Delta Corp Limited; and

Indian Express Newspapers (Mumbai) Limited.

Partnerships

Nil

Trusteeships

Nil

Atul Ruia

(S/o Ashok Kumar Ruia)


appointed by PML

Address: Ruia House, 19, Bhau Sahib,

Hire Marg, Malabar Hill, Mumbai 400 006



Nationality: Indian

DIN: 00087396


The Phoenix Mills Limited;

Bellona Finvest Limited;

Galaxy Entertainment Corporation Limited;

Galaxy Rain Restaurants Private Limited;

Graceworks Realty & Leisure Private Limited;

Phoenix Hospitality Company Private Limited;

Ruia International Holding Company Private

Limited;

Mugwort Developers Private Limited;

Destiny Hospitality Services Private Limited;

Kalani Holdings Private Limited;

Ashok Apparels Private Limited;

Senior Holding Private Limited;

Ashbee Investment & Finance Private Limited;

C.R. Retail Malls (India) Private Limited;

Thana Properties Private Limited;

Radhakrishna Ramnarain Private Limited;

R.R. Hosiery Private Limited;

Padmashil Hospitality and Leisure Private

Limited;

Excelsior Hotels Private Limited;

Pinnacle Real Estate Development Private

Limited;

Caravan Realty Private Limited;

UPAL Developers Private Limited;

Gangetic Developers Private Limited; and

Gangetic Hotels Private Limited.

Partnerships

R. R. Hosiery; and

R. R. Textiles.

Trusteeships

Radhakrishna Ruia Charitable Trust;

Rajkumari Radhakrishna Ruia Charitable Trust;

115



and DIN

Age

(Years)

Other Directorships

Aakaar Charitable Trust; and

Yogakshema Trust.


(S/o Sreekantiah Venkara Subbiah Gubbi)


appointed by PML

Address: 304, Phoenix Tower, B Wing,

Senapati Bapat Marg, Lower Parel, Mumbai

400 013


Occupation: Service

Nationality: Indian

DIN: 02585676


Pallazzio Hotels & Leisure Limited;

Classic Mall Development Company Private

Limited;

Classic Housing Projects Private Limited;

Starboard Hotels Private Limited; and

Escort Developers Private Limited.

Partnerships

Nil

Trusteeships

Nil

Paras Nath Pathak

(S/o R S Pathak)

Non- Executive, Independent Director

Address: 14/118, Indra Nagar, Lucknow

226 016


Occupation: Retired

Nationality: Indian

DIN: 03085406


NIL

Partnerships

Nil

Trusteeships

Nil

Mukesh Kacker

(S/o Brij Mohan Kacker)


Address: 5, Munirka Marg, Ground Floor,

Vasant Vihar, New Delhi 110 057


Occupation: Professional

Nationality: Indian

DIN: 01569098


Kacker & Daughter Infrastructure Consultancy

Services (Private) Limited; and

Arshiya International Limited.

Partnerships

Nil

Trusteeships

Nil

116



and DIN

Age

(Years)

Other Directorships

Girish Raj

(S/o Sethu Madhavan)


Address: Athina Township, 3rd

Stage,

Billishivale, Doddagubbi Post, Banglore 562

149


Occupation: Service

Nationality: Indian

DIN: 00080058


NIL

Partnerships

Nil

Trusteeships

Nil

Homi Aibara

(S/o Sorab Burjor Aibara)


Address: Jhaveri Mansion, 3rd

Floor, 30

Little Gibbs Road, Malabar Hills, Mumbai

400 006



Nationality: Indian

DIN: 00273262


Radhakrishna Foodland Private Limited;

Boot Export (Bombay) Private Limited;

Mahajan & Aibara Consulting Private Limited;

Shrashti Properties Services Private Limited;

and

deGustibus Hospitality Private Limited.

Partnerships

Mahajan & Aibara

Trusteeships

Nil

Suhail Nathani

(S/o Amin Husain Nathani)


Address: No. 801, Prabhu Kutir, 15

Altamount Road, Mumbai 400 026


Occupation: Professional

Nationality: Indian

DIN: 01089938


The Phoenix Mills Limited;

Development Credit Bank Limited;

B L A Industries Private Limited;

B L A Power Private Limited;

Siddhesh Capital Market Services Private

Limited (NBFC);

Indian Globalization Capital, Inc. (US

Corporation);

ELP Advisory Services Private Limited; and

Salaam Bombay Foundation (Section 25 Co).

Partnerships

Economic Law Practice

117



and DIN

Age

(Years)

Other Directorships

Trusteeships

V.O. Somani Family Trust; and

Everest Industries Staff Welfare Trust.

All the Directors of the Company are Indian nationals and none of the Directors of the Company are related to each

other.

Brief Profile of the Directors

Manish Kalani, is the Managing Director of the Company. He joined the Company on July 22, 1999. He completed

his Bachelors‟ degree in Arts from the Daly College, Indore. He also completed a course on Business

Administration from Sydenham College, Bombay University and thereafter completed financial workshop from

Wharton College of USA. He has 18 years of experience in the real estate industry. Before joining the Company, he

worked with Kalani Industries Private Limited.

B. Rajesh Nair, is the Executive Director of the Company. He joined the Company on July 1, 2003. He holds a

Bachelor‟s degree in Civil Engineering from Maulana Azad College of Technology, Bhopal and a Post Graduate

Diploma in Personnel Management from Indra Gandhi National Open University, New Delhi. He has 19 years of

experience in various industries. Before joining the Company, he worked with Kurtarkar Real Estate.

Sudarshan Bajoria, is the Non-Independent, Non- Executive Director appointed as a nominee of ICICI Venture

Funds Management Company Limited on the Board of the Company. He joined the Company on December 1, 2006.

He holds a Bachelor‟s degree in Electrical and Electronics Engineering from Manipal Institute of Technology and a

master‟s degree in Management from the School of Management, IIT, Mumbai. He has 10 years of experience in

handling private equity transactions.

Atul Ruia, is the Non-Independent, Non- Executive Director of the Company appointed by PML. He joined the

Company on May 4, 2010. He holds a dual Degree in Chemical Engineering and Finance from the University of

Pennsylvania and the Wharton School of Finance. He has been active in the real estate sector in India and was

instrumental in setting up and managing the project „High Street Phoenix‟ at lower parel, Mumbai. He is actively

involved in the development of various retail malls, restaurants, multiplex cinemas and other entertainment

complexes in India.

Balaji Sreekantiah Gubbi, is the Non-Independent, Non- Executive Director appointed by PML on the Board of

the Company. He joined the Company on March 16, 2009. He holds a Bachelor‟s degree in Civil Engineering. He

has 22 years of cross functional experience in engineering projects. Prior to joining Phoenix, he was associated with

companies like Dhafir Development & Contracting LLC, Sree Constructions, OBC Management Services Limited,

Taj Services Limited and EIH Limited.

Paras Nath Pathak, is the Non-Executive, Independent Director of the Company. He joined the Company on May

4, 2010. He holds a Masters Degree in Economics from Allahabad University and is a Law Graduate from Kanpur

University. He worked with the U.P. Electricity Regulatory Commission for five years and in the Indian Revenue

Services (Income Tax) for 35 years. During his tenure in the Indian Revenue Services (Income Tax), he worked as

Income Tax Officer, Assistant Director of Investigation, Additional Commissioner of Income Tax, Commissioner of

Income Tax, Director General of Investigation and Chief Commissioner of Income Tax at various places including

Mumbai, Bangalore, Kolkata, Kanpur, Indore and Lucknow.

Mukesh Kacker, is the Non-Executive, Independent Director of the Company. He joined the Company on May 4,

2010. He holds a Masters Degree in Economics from Harvard University, U.S.A. He was a topper in Bachelor of

Science (Physics, Mathematics and Statistics) and Master of Arts (Political Science) from the Allahabad University.

He was earlier working with the government as an I.A.S. officer of the 1979 batch. He worked as member of

118

National Highways Authority of India, as joint secretary (Petrochemicals), executive director of NAFED, and

director of Ministry of Human Resource Development. In his state cadre of Madhya Pradesh, he has held various

positions. He opted for premature voluntary retirement from the I.A.S. in 2007 and since then he is working as an

independent consultant and advisor in the field of infrastructure.

Girish Raj, is the Non-Executive, Independent Director of the Company. He joined the Company on May 4, 2010.

He holds a Bachelor Degree in English (Honors) from Delhi University and a Post Graduate Diploma in Business

Management in marketing from the Institute of Management Technology, Ghaziabad. He has over 17 years of cross

function experience in advertising sector. Presently, he is working with Idiom Design & Consulting Limited and is

responsible for strategic planning, design strategy, financial management, business planning and new business

development, copy writing and relationship management.

Homi Aibara, is the Non-Executive, Independent Director of the Company. He joined the Company on May 4,

2010. He holds a Bachelors Degree in Commerce (Honors), Calcutta and is a fellow of Institute of the Chartered

Accountants (England & Wales). He has cross functional experience in finance, hotel consultancy and management

consultancy activities. He worked with Hays Allan, a chartered accountants firm in London, ITC Limited and A.F.

Ferguson & Co. Presently, he is a partner of Mahajan & Aibara, which is involved in management consultancy

services.

Suhail Nathani, is the Non- Executive, Independent Director of the Company. He joined the company on May 4,

2010. He holds a Bachelor‟s Degree in Arts (Law) from Cambridge University, England and a Masters Degree in

Law from the Duke University,U.S. He is a partner of Economic Laws Practice, a law firm with offices in Mumbai,

Delhi, Ahmedabad and Pune. He is enrolled as an advocate in India and is also admitted to the New York State Bar

and the US Court of International Trade. With around two decades of experience, his areas of specialization include

corporate and commercial matters, private equity and international trade. He has advised on several investments in

the manufacturing, services and real estate sector in India. He has also represented the Government of India at the

WTO, most recently in the wines and spirits dispute against the USA.

Payment or benefit to Directors/ officers of the Company

The sitting fees/other remuneration paid to the Directors for the last fiscal year are as follows:

1. Remuneration to Executive Directors:

Manish Kalani was appointed as a Managing Director of the Company with effect from February 12, 2010

for a period of five years as approved by the shareholders at the EGM of the Company held on February 12,

2010. Presently, Manish Kalani does not receive any remuneration from the Company. He is also an

employee of TWDPL and has received a remuneration (including salary and perquisites) aggregating to Rs.

8.4 million during Fiscal 2010. By a resolution under section 314 of the Companies Act dated February 12,

2010, the shareholders of the Company have consented to the appointment of Manish Kalani as an

employee of TWDPL.

B. Rajesh Nair was appointed as an Executive Director of the Company with effect from February 12, 2010

as approved by the shareholders at the EGM of the Company held on February 12, 2010. Presently, B.

Rajesh Nair does not receive any remuneration from the Company. He is also an employee of TWDPL and

has received a remuneration (including salary and perquisites) aggregating to Rs. 9.64 million during Fiscal

2010. By a resolution under section 314 of the Companies Act dated February 12, 2010, the shareholders of

the Company have consented to the appointment of B. Rajesh Nair as an employee of TWDPL.

Presently, none of the other Directors except Manish Kalani and B. Rajesh Nair receive any remuneration,

including sitting fees, from the Company or any of its subsidiaries.

2. Remuneration to Non-Executive Directors

Presently, the Company does not pay any sitting fees or other remuneration to the Non- Executive

Directors. None of the Non-Executive Directors were paid any sitting or other fees during Fiscal 2010. The

119

Company may, however, in the future, pay sitting fees and/or other remuneration to the Non-Executive

Directors.

Except as stated in “Management” on page 113 of this Draft Red Herring Prospectus, no amount or benefit

(other than salaries paid in due course) has been paid within the two preceding years or is intended to be

paid or given to any of the Company‟s officers including the Directors and key management personnel.

Further, except statutory benefits upon termination of their employment in the Company or retirement, no

officer of the Company, including the Directors and key management personnel, are entitled to any benefits

upon termination of employment.

Shareholding of Directors

The shareholding of the Directors as of the date of filing this Draft Red Herring Prospectus is set forth below:

Name of Director Number of Equity Shares held

Manish Kalani 400

B. Rajesh Nair 40

Borrowing Powers of the Board

In accordance with the Articles of Association, the Board may, from time to time, at its discretion by a resolution

passed at its meeting raise or borrow or secure the payment of any sum or sums of money for the purposes of the

Company. However, if the moneys sought to be borrowed together with the moneys already borrowed (apart from

temporary loans obtained from the Company‟s bankers in the ordinary course of business) should 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 is required to obtain the consent of the shareholders in general meeting prior to undertaking

such borrowing.

In this regard, the Company had pursuant to a resolution passed by the Board and shareholders on March 29, 2010

under section 292 of the Companies Act, resolved that the Company is authorised to avail borrowings to the extent

of Rs. 3,000 million on the terms and conditions as agreed between the banks/ financial institutions and the

Company.

Corporate Governance

The provisions of the Listing Agreement to be entered into with the Stock Exchanges with respect to corporate

governance will be applicable to the Company immediately upon the listing of the Equity Shares with the Stock

Exchanges. The Company believes it is in compliance with the requirements of the applicable regulations, including

the Listing Agreement with the Stock Exchanges and the SEBI Regulations, in respect of corporate governance

including constitution of the Board and committees thereof. The corporate governance framework is based on an

effective independent Board, separation of the Board‟s supervisory role from the executive management team and

constitution of the Board Committees, as required under law.

We have a Board of Directors constituted in compliance with the Companies Act and Listing Agreement with Stock

Exchanges and in accordance with best practices in corporate governance. The Board of Directors functions either as

a full board or through various committees constituted to oversee specific operational areas. The executive

management provides the Board of Directors detailed reports on its performance periodically.

Currently the Board has ten Directors, of which the Chairman is an Executive Director. In compliance with the

requirements of Clause 49 of the Listing Agreement, we have two Executive Directors and eight Non-Executive

Directors, including five independent directors, on the Board.

120

Committees of the Board in accordance with the Listing Agreement

Audit Committee

The members of the Audit Committee are:

1. Paras Nath Pathak, Chairman;

2. Homi Aibara;

3. Mukesh Kacker;

4. Manish Kalani;

5. B. Rajesh Nair; and

6. Girish Raj.

The Audit Committee was constituted by a meeting of the Board held on May 4, 2010.

Terms of reference of the Audit Committee are:

a. Overseeing the Company‟s financial reporting process and disclosure of its financial information;

b. Recommending to the Board the appointment, re-appointment, and replacement of the statutory auditors

and the fixation of the audit fee;

c. Approval of payments to the statutory auditors for any other services rendered by them;

d. Reviewing, with the management, the annual financial statements before submission to the Board for

approval, with particular reference to:

(i) Matters required to be included in the Director‟s Responsibility Statement to be included in the

Board‟s report in terms of clause (2AA) of section 217 of the Companies Act, 1956;

(ii) Changes, if any, in accounting policies and practices and reasons for the same;

(iii) Major accounting entries involving estimates based on the exercise of judgement by management;

(iv) Significant adjustments made in the financial statements arising out of audit findings;

(v) Compliance with listing and other legal requirements relating to financial statements;

(vi) Disclosure of any related party transactions; and

(vii) Qualification in the draft audit report.

e. Reviewing, with the management, the quarterly, half-yearly and annual financial statements before

submission to the Board for approval;

f. Reviewing, with the management, the performance of statutory and internal auditors, and adequacy of the

internal control systems;

g. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit

department, staffing and seniority of the official heading the department, reporting structure coverage and

frequency of internal audit;

h. Discussion with internal auditors on any significant findings and follow up there on;

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i. Reviewing the findings of any internal investigations by the internal auditors into matters where there is

suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the

matter to the Board;

j. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well

as post-audit discussion to ascertain any area of concern;

k. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders,

shareholders (in case of non payment of declared dividends) and creditors;

l. Reviewing the functioning of the whistle blower mechanism, in case the same is existing;

m. Review of management discussion and analysis of financial condition and results of operations, statements

of significant related party transactions submitted by management, management letters/ letters of internal

control weakness issued by the statutory auditors, internal audit reports relating to internal control

weaknesses, and the appointment, removal and terms of remuneration of the chief internal auditors;

n. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee; and

o. Such other matters as may from time to time be required by any statutory, contractual or other regulatory

requirements to be attended to by such committee.

The powers of the Audit Committee are:

a. To investigate activity within its terms of reference;

b. To seek information from any employees;

c. To obtain outside legal or other professional advise; and

d. To secure attendance of outsiders with relevant expertise, if it considers necessary.

Shareholders’/Investors’ Grievance Committee

The members of the Shareholders‟/Investors‟ Grievance Committee are:

1. Suhail Nathani, Chairman;

2. Homi Aibara;

3. Manish Kalani; and

4. B. Rajesh Nair.

The Shareholders‟/Investors‟ Grievance Committee was constituted by a meeting of the Board held on May 4, 2010.

This Committee is responsible to carry out such functions for the redressal of shareholders‟ and investors‟

complaints, including but not limited to, transfer of shares, non-receipt of balance sheet, non-receipt of dividends,

and any other grievance that a shareholder or investor of the Company may have against the Company.

Compensation Committee

The members of the Compensation Committee are:

1. Manish Kalani, Chairman;

2. Mukesh Kacker;

3. Homi Aibara; and

4. B. Rajesh Nair.

The Compensation Committee was constituted by a meeting of the Board held on May 4, 2010. The terms of

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reference of the Committee are as follows:

a. Framing suitable policies and systems to ensure that there is no violation, by an employee of any applicable

laws in India or overseas, including:

(i) The Securities and Exchange Board of India (Insider Trading) Regulations, 1992; or

(ii) The Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices

relating to the Securities Market) Regulations, 1995.

b. Determine on behalf of the Board and the shareholders the Company‟s policy on specific remuneration

packages for executive directors including pension rights and any compensation payment;

c. Perform such functions as are required to be performed by the Compensation Committee under the

Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase

Scheme) Guidelines, 1999 (“ESOP Guidelines”), in particular, those stated in Clause 5 of the ESOP

Guideline; and

d. Such other matters as may from time to time be required by any statutory, contractual or other regulatory

requirements to be attended to by such committee.

Policy on Disclosures and Internal Procedure for Prevention of Insider Trading

The provisions of Regulation 12 (1) of the SEBI (Prohibition of Insider Trading) Regulations, 1992 will be

applicable to the Company immediately upon the listing of its Equity Shares on the Stock Exchanges. We shall

comply with the requirements of the SEBI (Prohibition of Insider Trading) Regulations, 1992 on listing of the

Equity Shares.

Interest of Directors

All the Directors may be deemed to be interested to the extent of fees payable to them if any, for attending meetings

of the Board or a committee thereof as well as to the extent of other remuneration and reimbursement of expenses

payable to them, if any under the Articles of Association, and to the extent of remuneration paid to them, if any for

services rendered as an officer or employee of the Company.

The Directors may also be regarded as interested in the Equity Shares, if any, held by them or by the

companies/firms/ventures promoted by them or that may be subscribed by or allotted to the companies, firms, trusts,

in which they are interested as Directors, members, partners, trustees and Promoter, pursuant to this Issue. All of the

Directors may also be deemed to be interested to the extent of any dividend payable to them and other distributions

in respect of the said Equity Shares.

The Directors have no interest in any property acquired by the Company within two years of the date of this Draft


Except as stated in “Related Party Transactions” on page 160 of this Draft Red Herring Prospectus, the Directors do

not have any other interest in the business of the Company.

Changes in Board in the last three years

The following changes have occurred in Board of Directors of the Company in the last three years:

Name of Director Date of Appointment /

Re-appointment

Date of Cessation Reason

Pawan Kumar Jain August 28, 2005 April 14, 2008 Resignation

O. P. Srivastava December 1, 2006 April 14, 2008 Resignation

B. Rajesh Nair April 14, 2008 - Appointment

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Name of Director Date of Appointment /

Re-appointment

Date of Cessation Reason

Atul Ruia September 30, 2005 September 24, 2008 Resignation

Farzana Mojgani September 24, 2008 March 16, 2009 Resignation

Balaji Sreekantiah Gubbi March 16, 2009 - Appointment

Pradeep Varshney April 14, 2008 September 24, 2008 Resignation

Mukesh Kacker May 4, 2010 - Appointment

Girish Raj May 4, 2010 - Appointment

Paras Nath Pathak May 4, 2010 - Appointment

Homi Aibara May 4, 2010 - Appointment

Atul Ruia May 4, 2010 - Appointment

Suhail Nathani May 4, 2010 - Appointment

Shishir Srivastava December 12, 2006 May 4, 2010 Resignation

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Key Managerial Personnel

The details of the key managerial personnel are as under:

1. B. Rajesh Nair, For further details, see “Management - Brief Profile of the Directors” on page 117 of this


2. Kush Medhora, aged 44 years and an Indian national, is the Chief Operating Officer of TWDPL. He

joined TWDPL on January, 15 2009. He holds a Bachelor‟s Degree in Commerce from the Bangalore

University. He has 20 years of experience in various industries. Before joining TWDPL, he worked with

Desarch Pentacle Private Limited. During Fiscal 2010, he was paid a gross compensation of Rs. 5.05

million.

3. Yagnesh Sanghrajka, aged 43 years and an Indian national, is the Chief Finance Officer of TWDPL and is

responsible for discharging all finance related functions for the EWDL group. He joined TWDPL on

September 26, 2009. He is a qualified Chartered Accountant from the Institute of Chartered Accountants of

India. He has 20 years of experience in various industries. Before joining TWDPL, he worked with

Bessemer Venture Partners. During Fiscal 2010, he was paid a gross compensation of Rs. 2.96 million.

4. Vikas Aggarwal, aged 50 years and an Indian national, is the Managing Director of ITPL. He joined ITPL

on April 1, 2008. He holds a Post Graduate Degree in Architecture from the School of Planning and

Architecture, New Dehi. He has 24 years of experience in various industries. Before joining ITPL, he was

self employed. During Fiscal 2010, he was paid a gross compensation of Rs. 2.95 million.

5. Kamal Kishore Chaturvedi, aged 50 years and an Indian national, is the Executive Vice President – Legal

of TWDPL. He has been associated with us since November 16, 2006 and joined TWDPL on April 1,

2008. He holds a Bachelor‟s Degree in Science (Chemistry & Biology) from the Bundelkhan University-

Jhansi, a Master of Laws from the Bombay University, a Diploma in Business Management (D.B.M.) from

the Dahnukar Institute of Management, Mumbai and ATA from Textile Association of India, Mumbai. He

has 29 years of experience in various industries. Before joining TWDPL, he worked with Grasim Industries

Limited of Aditya Birla Group. During Fiscal 2010, he was paid a gross compensation of Rs. 2.01 million.

6. Bimal K. Nanda, aged 40 years and an Indian national, is the Executive Vice President– Corporate Affairs

& Company Secretary of the Company. He joined the Company on April 2, 2008. He is qualified Company

Secretary from the Institute of Company Secretaries of India and Cost & Works Accountants from the

Institute of Cost & Works Accountants of India. He has 17 years of experience in various industries. Before

joining the Company, he worked with Sahara Group as company secretary. During Fiscal 2010, he was

paid a gross compensation of Rs. 2.59 million.

7. Sanjay Sangamnerkar, aged 41 years and an Indian national, is the Chief Operating Officer-Projects of

TWDPL. He has been associated with us since January 1, 2007 and joined ITTPL on May 1, 2010. He

holds a Bachelor‟s Degree in Civil Engineering from the Govindram Seksaria Institute of Technical

Sciences, Indore. He has 22 years of experience in various industries. Before joining TWDPL, he was self

employed. During Fiscal 2010, he was paid a gross compensation of Rs. 3.85 million.

8. Sunil Malhotra, aged 51 years and an Indian national, is the Chief Operating Officer-MEP Services of

Treasure MEP Services Private Limited. He has been associated with us since March 16, 2006 and joined

Treasure MEP Services Private Limited on April 1, 2008. He holds a Bachelor‟s Degree in Mechanical

Engineering from the Govindram Seksaria Institute of Technical Sciences, Indore. He has 28 years of

experience in various industries. Before joining Treasure MEP Services Private Limited, he was self

employed. During Fiscal 2010, he was paid a gross compensation of Rs. 3.08 million.

9. Avnish Hasija, aged 46 years and an Indian national, is the Executive Vice President – Leasing of

TWDPL. He has been associated with us since May 10, 2004 and joined TWDPL on April 1, 2008. He

holds a Bachelor‟s Degree in Commerce from the Indore University and a Master of Business

Administration (Diploma in Marketing) from Hyderabad (distance education). He has 28 years of

126

experience in various industries. Before joining TWDPL, he was self employed. During Fiscal 2010, he

was paid a gross compensation of Rs. 3.05 million.

10. Col. Sunil Sharma, aged 52 years and an Indian national, is the Centre Director – Indore Projects

(Treasure Island, Treasure Market City & Ujjain Treasure Bazaar) of ITMCPL. He joined ITMCPL on May

26, 2008. He holds a Bachelor‟s Degree in Telecom Engineering from the Jawaharlal Nehru University,

Delhi. He has 32 years of experience in various industries. Before joining ITMCPL, he worked with DLF.

During Fiscal 2010, he was paid a gross compensation of Rs. 2.01 million.

11. Ravindra K. Chourasiya, aged 43 years and an Indian national, is the Executive Vice President- Finance

& Accounts of TWDPL. He has been associated with us since January 1, 2004 and joined TWDPL on April

1, 2008. He is a qualified Chartered Accountant from the Institute of Chartered Accountants of India. He

has 20 years of experience in various industries. Before joining TWDPL, he worked with Gajra Bevel

Group. During Fiscal 2010, he was paid a gross compensation of Rs. 2.62 million.

12. Manisha Kalani, aged 41 years and an Indian national, is the Head – Mall Promotions of TWDPL. She has

been associated with us since December 1, 2006 and joined TWDPL on April 1, 2008. She holds a

Bachelor‟s Degree in Arts from the University of Delhi. She has three years of experience in various

industries. Before joining TWDPL, she was self employed. During Fiscal 2010, she was paid a gross

compensation of Rs. 0.56 million.

13. Quresh Y. Matkawala, aged 53 years and an Indian national, is the Vice President – Project Accounts of

TWDPL. He has been associated with us since December 1, 2004 and joined TWDPL on June 1, 2010. He

holds Bachelor‟s Degree in Commerce from the University of Mumbai. He has 27 years of experience in

various industries. During Fiscal 2010, he was paid a gross compensation of Rs. 1.08 million.

14. Rajendra Kumar Shukla, aged 45 years and an Indian national, is the Vice President-Planning of

TWDPL. He has been associated with us since December 3, 2007 and joined TWDPL on April 1, 2008. He

holds a Bachelor‟s Degree in Civil Engineering from the Regional Engineering College, Calicut. He has 20

years of experience in various industries. Before joining TWDPL, he worked with Indiabulls Real Estate

Private Limited. During Fiscal 2010, he was paid a gross compensation of Rs. 1.92 million.

15. Naveen Seth, aged 43 years and an Indian national, is the Vice President - Materials of TWDPL. He has

been associated with us since February 18, 2008 and joined TWDPL on April 1, 2008. He holds a

Bachelor‟s Degree in Commerce from the University of Delhi and a Post Graduate in Materials

Management from the University of Delhi. He has 17 years of experience in various industries. Before

joining TWDPL, he worked with Mahindra Holidays and Resorts India Limited. During Fiscal 2010, he

was paid a gross compensation of Rs. 1.43 million.

16. Inder Arora, aged 40 years and an Indian national, is the Vice President – Projects of TWDPL. He has

been associated with us since September 1, 2007 and joined ITMCPL on May 1, 2010. He holds a

Bachelor‟s Degree in Civil Engineering from the Regional Engineering College, Kurukshetra. He has 17

years of experience in various industries. Before joining TWDPL, he worked with Golden Green Golf &

Resorts Limited. During Fiscal 2010, he was paid a gross compensation of Rs. 1.87 million.

17. Manoj Sharma, aged 35 years and an Indian national, is the Vice President-Projects of Landmark Treasure

Town. He has been associated with us since September 10, 2007 and joined Landmark Treasure Town on

March 1, 2009. He holds a Bachelor‟s Degree in Civil Engineering from the Institute of Engineers (India).

He has 16 years of experience in various industries. Before joining Landmark Treasure Town, he worked

with Today Homes & Infrastructure Limited. During Fiscal 2010, he was paid a gross compensation of Rs.

1.33 million.

18. Adarsh Gupta, aged 34 years and an Indian national, is the Vice President – Corporate Finance of

TWDPL. He joined TWDPL on August 6, 2008. He is a qualified Chartered Accountant from the Institute

of Chartered Accountants of India. He has 14 years of experience in various industries. Before joining

TWDPL, he worked with Brescon Corporate Advisors Limited. During Fiscal 2010, he was paid a gross

127

compensation of Rs. 2.36 million.

19. Manjit Garkel, aged 45 years and an Indian national, is the Vice President-Leasing of TWDPL. He joined

TWDPL on July 27, 2009. He holds a Bachelor‟s Degree in Science from the Mumbai University and a

Master of Business Administration in Marketing from Mumbai. He has 21 years of experience in various

industries. Before joining TWDPL, he worked with Desarch Pentacle Private Limited. During Fiscal 2010,

he was paid a gross compensation of Rs. 1.37 million.

20. Rajen P Savla, aged 34 years and an Indian national, is the Vice President –Leasing and Business

Development for the Company. He has been associated with us since November 2, 2009 and joined

TWDPL on January 1, 2010. He is a Master of Business Administration from Welingkar‟s Institute of

Management and Research, Mumbai. He has 15 years of experience in the real estate industry. Before

joining us, he worked with Mahindra Lifespace Developers Limited. During Fiscal 2010, he was paid a

gross compensation of Rs. 0.75 million.

21. Ravindra Dey, aged 36 years and an Indian national, is the Vice President- Human Resource &

Administration of TWDPL. He joined TWDPL on October 24, 2009. He holds a Master‟s Degree in

Commerce from the University of Mumbai, a Master of Business Administration in Human Resource from

SIMSR, Mumbai University, a post graduate diploma in software engineering from Aptech, Mumbai. He

has 15 years of experience in various industries. Before joining TWDPL, he worked with the Chatterjee

Group Real Estate. During Fiscal 2010, he was paid a gross compensation of Rs. 1.03 million.

22. Venu G. Vedula, aged 45 years and an Indian national, is the Vice President-Leasing of TWDPL. He

joined TWDPL on September 4, 2009. He holds a Bachelor‟s Degree in Arts from the Andhra

University. He has 21 years of experience in various industries. Before joining TWDPL, he worked with

Lals Group of Dubai. During Fiscal 2010, he was paid a gross compensation of Rs. 1.14 million.

23. Sameer Monga, aged 33 years and an Indian national, is the Corporate Chef of TFBPL. He joined TFBPL

on June 7, 2008. He holds a Diploma in Hotel Management from the National Council for Hotel

Management Catering Technology & Applied Nutrition from Ahmedabad Institute, a Diploma in

Marketing Management and Personnel Management from Annamalai University and Post Graduate in Arts

with honours in English from Andhra University. He has 14 years of experience in various

industries. Before joining TWDPL, he worked with Bangkok International Cuisine Company Limited,

Thailand. During Fiscal 2010, he was paid a gross compensation of Rs. 1.62 million.

All the key managerial personnel other than Bimal K. Nanda are permanent employees of TWDPL and other

subsidiaries of the Company and none of the Directors and the key managerial personnel are related to each

other.

Shareholding of the Key Managerial Personnel

None of the key managerial personnel other than B. Rajesh Nair hold any Equity Shares in the Company.

Bonus or Profit Sharing Plan for the Key Managerial Personnel

There is no bonus or profit sharing plan for the key managerial personnel.

Interests of key management personnel

Except Manisha Kalani (as part of Promoter Group) and B. Rajesh Nair (to the extent of dividend entitlement on the

Equity Shares held by him), none of the key management personnel of the Company have any interest in the

Company other than to the extent of the remuneration or benefits to which they are entitled to as per their terms of

appointment, reimbursement of expenses incurred by them during the ordinary course of business and the employee

stock options held, if any.

None of the key management personnel have been paid any consideration of any nature from the Company, other

128

than their remuneration.

Changes in Key Management Personnel during the last three years

Name Designation Date of change Reason for

change

Sanjay Sangamnerkar Chief Operating Officer- Projects January 1, 2007 Appointment Inder Arora Vice President – Projects September 1,

2007 Appointment

Manoj Sharma Vice President – Projects September 10,

2007

Appointment

Rajendra Kumar

Shukla

Vice President – Planning December 3, 2007 Appointment

Naveen Seth Vice President – Materials February 18, 2008 Appointment

Vikas Aggrawal Managing Director – ITPL (Intesys) April 1, 2008 Appointment

Bimal K. Nanda EVP –Corporate Affairs & Strategic Planning April 2, 2008 Appointment

Manu Dhir Chief Operating Officer April 31, 2010 Resignation

Col. Sunil Sharma Centre Director May 26, 2008 Appointment

Sameer Monga Corporate Chef June 9, 2008 Appointment

C. Krishnakumar

Menon

Centre Director July 1, 2008 Resignation

Saurabh Saxena Deputy Director – Development July 10, 2008 Resignation

Adarsh Gupta Vice President – Corporate Finance August 6, 2008 Appointment

Sanjay S. D. Panchal Chief Design Officer October 10, 2008 Resignation

Kush Medhora Chief Operating Officer January 15, 2009 Appointment

Siddharth Dadlani Chief Investment Officer February 5, 2009 Resignation

Vinay Pradhan Executive Vice President – Human Resource May 30, 2009 Resignation

Shekhar Grover Executive Vice President – Corporate

Communications

June 3, 2009 Resignation

Manjit Garkel Vice President – Leasing July 27, 2009 Appointment

Vinu G. Vedula Vice President – Leasing September 4,

2009

Appointment

Yagnesh Sanghrajka Chief Finance Officer September 26,

2009

Appointment

Santosh Pandey Deputy Director – Development October 12, 2009 Resignation

Ravindra Dey Vice President – Human Resource &

Administration

October 24, 2009 Appointment

K. Shankar Narayanan Executive Director October 25, 2009 Resignation

Rajen P. Savla Vice President – Leasing November 2, 2009 Appointment

Baldev Kumar Gupta Vice President – Accounts December 22,

2009

Resignation

K. Madhusudhan Chief Finance Officer July 31, 2008 Resignation

Ashok Binder Vice President-Corporate Affairs November 17,

2007

Resignation

Payment or Benefit to officers of the Company

No non-salary related amount or benefit has been paid or given within two years, or intended to be paid or given, to

any officer of the Company (including Directors and Key Management Personnel).

129

SUBSIDIARIES AND JOINT VENTURE

The Company has 29 Subsidiaries and a Joint Venture. None of the Subsidiaries have made any public or rights

issue in the last three years and have not become sick companies under the meaning of SICA and are not under

winding up. Other than as disclosed in “Promoters and Promoter Group” on page 149 of this Draft Red Herring

Prospectus, the Promoters have not disassociated from any of the companies during the preceding three years.

Interest of the Subsidiaries in the Company

None of the Subsidiaries hold any Equity Shares in the Company. Except as stated in “Related Party Transactions”

on page 160 of this Draft Red Herring Prospectus, the Subsidiaries do not have any other interest in the Company‟s

business.

1. Treasure World Developers Private Limited (“TWDPL”)

Corporate Information

TWDPL was incorporated as „Gwalior Entertainment World Private Limited‟ on July 18, 2006 under the

Companies Act. The name was subsequently changed to „Indore Entertainment World Developers Private

Limited‟ on September 3, 2007 and to „Treasure World Developers Private Limited‟ on October 7, 2008.

TWDPL is engaged in the business of development of shopping malls, commercial complexes including

multiplex, hotels, food courts and project management.

Further, pursuant to the order dated May 7, 2010 by the High Court of Bombay, the scheme of

amalgamation of Treasure World Constructions Private Limited (“TWCPL”) with TWDPL was sanctioned

and approved. TWCPL was engaged in the business of builders, construction, developers, contractors and

other real estate development. Since TWCPL was a wholly owned subsidiary company of TWDPL, no

equity shares were issued or allotted and accordingly all equity shares held by TWDPL in TWCPL were

cancelled.

Share and debenture subscription agreement dated November 15, 2007 (“Investor Agreement”)

IAF - III and IAF - IV represented by their investment manager, ICICI Venture Funds Management

Company Limited (the “Investors”) has invested Rs. 1,500 million by subscribing to 149,999,150

unsecured fully convertible debentures of TWDPL of Rs. 10 each aggregating to Rs. 1,499,991,500

(“Convertible Debentures”) and 10 equity shares of TWDPL of face value Rs. 10 each at a price of Rs. 850

per equity share, aggregating to Rs. 8,500 pursuant to the Investor Agreement with TWDPL and the

Company. The Convertible Debentures have a term of four years and 90 days from the date of issue and

will accrue, until converted, a yield to maturity interest at the rate of 5% per annum compounded semi



TWDPL in accordance with the Investor Agreement. Until conversion, TWDPL has an option of paying an

additional coupon over and above the 5% interest to be paid in cash as mentioned above and such

additional amount shall not exceed 8% compounded semi annually.

In terms of the Investor Agreement, the Convertible Debentures can inter alia be converted into equity

shares of TWDPL prior to the initial public offering of TWDPL. The Investors have the right to convert all

Convertible Debentures into paid-up equity shares of TWDPL upon determination of the price band in

relation to the initial public offering of TWDPL. The Convertible Debentures can also be converted into the

equity shares of TWDPL on maturity, which is the date falling on the expiry of four years and 90 days from

the date of issue of the Convertible Debentures. The Investor Agreement also provides that in the event, the

Company proposes to undertake an initial public offer before TWDPL, it would use reasonable and

commercial efforts to offer an exit to the Investors through a conversion of the Convertible Debentures into

the Equity Shares of the Company.

130

On the occurrence of an event of default under the Investor Agreement, the Investors, inter alia have a right

to require the Company, to purchase all the outstanding Convertible Debentures and equity shares held by

the Investors in TWDPL at a price that will be determined under the terms of the Investor Agreement. In

the event that the Company fails to purchase the Convertible Debentures and the equity shares as required

by the Investors within 30 days of a notice from the Investors, the Investors will have a right to convert the

Convertible Debentures into the equity shares of TWDPL constituting 51% of equity share capital of

TWDPL in addition to a right to sell the Convertible Debentures to any third party. If the Investors elects to

transfer the Convertible Debentures and equity shares held by it in TWDPL to a third party, then the

Investors will also have a right to require the Company or any of its affiliates to transfer such number of

equity shares of TWDPL to such third party purchaser such that the third party purchaser will obtain an

aggregate of 51.0% of the equity share capital of TWDPL. In case of default under clause 11.1.11 of the

Investor Agreement, i.e. no exit option on an initial public offer by the Company, the Investors shall be

entitled to receive such further amount which ensures an IRR of 25% on the amount invested after

adjustments as specified in the Investor Agreement. The Investors have the right to sell, transfer, assign or

otherwise create any interest in all or part of the Convertible Debentures subject to the provisions of the

applicable laws and such third party signing a letter agreeing to the terms and conditions under the Investor

Agreement and the letter dated June 11, 2010.

The Investors also have the right to nominate a director on the board of directors of TWDPL and a right to

affirmative vote on certain corporate matters, including, alteration of the authorised and paid up equity

share capital of TWDPL, amendment to the memorandum and articles of association of TWDPL,

recommendation of dividend, changing the nature of business and effecting any change in control.

Share and debenture subscription agreement dated October 10, 2008 (“Phoenix Agreement”)

PML has subscribed to 100 million unsecured fully convertible debentures of TWDPL of Rs. 10 each

aggregating to Rs. 1,000 million (“Convertible Debentures”) and 10 equity shares of TWDPL of Rs. 10

each at a premium of Rs. 840 per equity share aggregating to Rs. 8,500 in terms of the Phoenix Agreement

with TWDPL, the Company, IAF - III and IAF - IV (IAF - III and IAF - IV collectively referred to as the

“Investors”). The Convertible Debentures have a term of four years and 90 days from the date of issue and

will accrue, until converted, a yield to maturity interest at the rate of 5% per annum compounded semi



TWDPL in accordance with the Phoenix Agreement.

In terms of the Phoenix Agreement, the Convertible Debentures can inter alia be converted into equity

shares of TWDPL prior to the initial public offering of TWDPL. PML has the right to convert all

Convertible Debentures into paid-up equity shares of TWDPL upon determination of the price band in

relation to the initial public offering of TWDPL. The Convertible Debentures can also be converted into the

equity shares of TWDPL on maturity, which is the date falling on the expiry of four years and 90 days from

the date of issue of the Convertible Debentures. The Phoenix Agreement also provides that in the event, the

Company proposes to undertake an initial public offer before TWDPL, it would use reasonable and

commercial efforts to offer an exit to PML through a conversion of the Convertible Debentures into the

Equity Shares of the Company.

On the occurrence of an event of default under the Phoenix Agreement, PML, inter alia, has a right to

require the Company, to purchase all the outstanding Convertible Debentures and equity shares held by

PML in TWDPL at a price that will be determined under the terms of the Phoenix Agreement. In the event

that the Company fails to purchase the Convertible Debentures and the equity shares as required by PML

within 30 days of a notice from PML, PML will have a right to convert the Convertible Debentures into the

equity shares of TWDPL constituting 48.5% of equity share capital of TWDPL in addition to a right to sell

the Convertible Debentures to any third party. If PML elects to transfer the Convertible Debentures and

equity shares held by it in TWDPL to a third party, then PML will have a right to require the Company or

any of its affiliates to transfer such number of equity shares of TWDPL to such third party purchaser such

that the third party purchaser will obtain an aggregate of 48.5% of the equity share capital of TWDPL.

However, PML‟s right to transfer the Convertible Debentures and equity shares held by it to any third party

131

purchaser is subject to a right to first offer of the Investors to purchase such Convertible Debentures and

equity shares.

PML also has the right to nominate a director on the board of directors of TWDPL and a right to

affirmative vote on certain corporate matters including, alteration of the authorised and paid-up equity

share capital of TWDPL, amendment to the memorandum and articles of association of TWDPL,

recommendation of dividend, changing the nature of business and effecting any change in control.

The Company, TWDPL, PML and the Investors have entered into a letter dated June 11, 2010 whereby the

Investors and PML have agreed to the Company purchasing a portion of Convertible Debentures held by

the Investors or any other holder(s) of the Convertible Debentures, if such Convertible Debentures are

transferred by the Investors before the purchase by the Company subject to such third party signing a letter

agreeing to the terms and conditions under the Investor Agreement and the letter dated June 11, 2010 for an

aggregate price of Rs. 750 million and a portion of Convertible Debentures held by PML for an aggregate

price of Rs. 500 million by utilising a portion of the Net Proceeds from the Issue aggregating to Rs. 1,250

million. Additionally, the Investors and PML have waived their pre-emptive rights in relation to such

portion of Convertible Debentures proposed to be purchased by the Company. In the event that the

Company is unable to complete the Issue before January 31, 2011 or any further period as agreed by the

Investors and/or PML, the consents and waivers provided under the letter will be terminated. In this regard,

pursuant to the letter dated July 2, 2010, the Investors has consented and extended the filing of the draft red

herring prospectus with SEBI from June 30, 2010 to July 15, 2010 and to complete the Issue by February

15, 2011. All other rights, terms and conditions under the Investor Agreement and the Phoenix Agreement

including rights, terms and conditions with respect to the balance Convertible Debentures held by the

Investors and PML respectively, shall continue to be binding on parties to the Investor Agreement and the

Phoenix Agreement.

Capital Structure as of June 30, 2010

No. of equity shares of Rs. 10 each

Authorised capital 1,250,000

Issued, subscribed and paid-up capital 1,000,010

Shareholding Pattern as of June 30, 2010

The shareholding pattern of TWDPL is as follows:

S.

No.

Name of the Shareholder No. of equity shares

of Rs. 10 each

Percentage of total of

equity holding (%)

1. EWDL 999,990 99.99

2. IAF - III 5 -

3. IAF - IV 5 -

4. PML 10 -

Total 1,000,010 100.00

2. Ujjain Treasure Bazaar Private Limited (“UTBPL”)


UTBPL was incorporated as „Horizon Complex Private Limited‟ on February 24, 2006 under the

Companies Act. On September 29, 2008 the name was changed to „Ujjain Treasure Bazaar Private

Limited‟. UTBPL is engaged in the business of development of shopping mall, commercial complexes

including multiplex, hotel and food courts.


132


Authorised capital 50,000

Issued, subscribed and paid-up capital 50,000


The shareholding pattern of UTBPL is as follows:

S.

No.

Name of the Shareholder No. of equity shares of

Rs. 10 each


equity holding (%)

1. EWDL 49,990 99.98


Total 50,000 100.00

3. Amaravati Treasure Bazaar Private Limited (“ATBPL”)


ATBPL was incorporated as „Amaravati Entertainment World Developers Private Limited‟ on April 3,

2008 under the Companies Act. On September 19, 2008 the name was changed to „Amaravati Treasure

Bazaar Private Limited‟. ATBPL is engaged in the business of development of shopping mall, commercial

complexes including multiplex, hotel and food courts.






The shareholding pattern of ATBPL is as follows:

S.

No.

Name of the Shareholder No. of equity shares

of Rs. 10 each


equity holding (%)

1. EWDL 9,980 100

2. Manish Kalani* 10 -

3. B. Rajesh Nair* 10 -

Total 10,000 100.00 *

Equity Shares held on behalf of EWDL

4. EWDPL Five Star Hospitality Private Limited (“EFSHPL”)


EFSHPL was incorporated as „EWDPL Five Star Hospitality Private Limited‟ on March 13, 2008 under the

Companies Act. EFSHPL is engaged in the business of development of shopping mall, commercial






133


The shareholding pattern of EFSHPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. EWDL 9,980 100



Total 10,000 100.00 *

Equity shares held on behalf of EWDL

5. Nanded Treasure Bazaar Private Limited (“NTBPL”)


NTBPL was incorporated as „Entertainment World Developers Nanded Private Limited‟ on January 25,

2007 under the Companies Act. On September 23, 2008, the name was changed to „Nanded Treasure

Bazaar Private Limited‟. NTBPL is engaged in the business of development of shopping mall, commercial


Memorandum of Understanding and Shareholders Agreement between the Company and Thakkar

Industries

NTBPL was incorporated pursuant to a Memorandum of Understanding dated January 11, 2007 (the

“MoU”) and Shareholders Agreement dated April 23, 2008 among the Company and Thakkar Industries

(the “SHA”) as a special purpose vehicle for developing a shopping mall and a hotel at Nanded. The parties

have agreed to contribute to the paid-up equity capital of NTBPL in the ratio of 75:25. In terms of the sale

deed dated April 4, 2007, Thakkar Industries have sold 117,790 sq.ft. land (the “Land”) for a total

consideration of Rs. 82,300,000 for the development of the shopping mall and the hotel. In terms of the

MoU, an amount of Rs. 20,575,000 was paid by Thakkar Industries towards the issue of equity shares of

NTBPL constituting 25% of the paid-up equity share capital of NTBPL. The SHA provides that,

relationship of the Company and Thakkar Industries shall be governed by the terms and conditions of the

MoU and the memorandum and articles of association of NTBPL. Any further equity contribution required

in NTBPL shall be made by the Company and Thakkar Industries in the ratio of 75:25.






The shareholding pattern of NTBPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. EWDL 757,980 75.20



4. Thakkar Industries 250,000 24.80

134

Total 1,008,000 100.00 *

Equity shares held on behalf of EWDL

6. Treasure Showcase Private Limited (“TSPL”)


TSPL was incorporated as „EWDPL Holdings Private Limited‟ on May 3, 2007 under the Companies Act.

On January 20, 2010, the name was changed to „Treasure Showcase Private Limited‟. TSPL is engaged in

the business of development of shopping mall, commercial complexes including multiplex, hotel and food

courts.






The shareholding pattern of TSPL is as follows:

S.

No.


Rs.10 each


equity holding (%)

1. Entertainment World Developers Limited 9,980 100



Total 10,000 100.00 * Equity shares held on behalf of EWDL

7. EWDPL Residential Holdings Private Limited (“ERHPL”)


ERHPL was incorporated as „EWDPL Residential Holdings Private Limited‟ on July 23, 2007 under the

Companies Act. ERHPL is engaged in the business of investment in shares, stock, debentures, debentures

stocks and bonds.






The shareholding pattern of ERHPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. EWDL 9,980 100



Total 10,000 100.00 * Equity Shares held on behalf of EWDL

8. Marvell Mall Development Company Private Limited (“MMDCPL”)

135


MMDCPL was incorporated as Marvell Mall Development Company Private Limited on March 14, 2006

under the Companies Act. MMDCPL, under the memorandum of association, is permitted to engage in the

business of development of shopping mall, commercial complex including multiplex, hotel and food courts.




Issued and susbcribed capital 14,000,000

Paid-up capital 12,091,500#

# These Equity Shares were issued as partly paid Equity Shares to Kshitij Venture Capital Fund at Rs. 5 per Equity Share, EWDL at

Re. 1 and Rs. 9 per Equity Share and Sharyans Resources Limited at Rs. 5 per Equity Share.


The shareholding pattern of MMDCPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. EWDL 7,140,000 51.00

2. Kshitij Venture Capital Fund 3,640,000 26.00

3. Edelweiss Trustee Services Private Limited 1,680,000 12.00

4. Sharyans Resources Limited 700,000 05.00

5. Parthiv Kilachand 350,000 02.50

6. Nandish Kilachand 350,000 02.50

7. Shishir Srivastava 62,402 0.45

8. PML 77,598 0.55

Total 14,000,000 100.00

9. The Baroda Commercial Corporation Limited (“BCCL”)


BCCL was incorporated as „The Baroda Commercial Corporation Limited‟ on October 22, 1942 under the

Baroda State Companies Act. In 1956, BCCL was registered under the Companies Act as a private limited

company and was converted into a public company in 1988. BCCL is engaged in the business of trade,

commercial operation, agriculture and manufacture.






The shareholding pattern of BCCL is as follows:

S.

No.

Name of the Shareholder No. of equity shares of Rs.

500 each

Percentage of total

of equity holding

(%)

1. MMDCPL 1,994 99.70 2. K B Gandhi

* 1 0.05

136

3. PML* 1 0.05

4. Farzana Mojgani* 1 0.05

5. Abhilash Sunny* 1 0.05

6. Gaurav Mardia* 1 0.05

7. Mahesh Iyer* 1 0.05

Total 2000 100.00 *Equity shares held jointly with MMDCPL

10. Raipur Treasure Island Private Limited (“RTIPL”)


RTIPL was incorporated as „Raipur Entertainment World Private Limited‟ on July 17, 2006 under the

Companies Act. On September 23, 2008 the name was changed to „Raipur Treasure Island Private

Limited‟. RTIPL is engaged in the business of developing shopping malls, commercial complexes


Shareholders agreement dated September 30, 2008 between RTIPL, Indore Entertainment World

Developers Private Limited (“IEWDPL”), Manish Kalani, B. Rajesh Nair and Diemel River Limited

(“DRL”) (the “SHA”)

Pursuant to the SHA, RTIPL has issued 327,488 equity shares at a price of Rs. 1,454.55 per equity share

for an amount aggregating to Rs. 476,346,695 constituting 32.83% of the total issued and paid-up equity

share capital to DRL. DRL has further agreed to invest an additional amount of Rs. 3,653,305 by

subscribing to 2,512 equity shares at a price of Rs. 1,454.55 per equity share. IEWDPL, Manish Kalani, B.

Rajesh Nair and DRL have proposed RTIPL to undertake the development and construction of retail

shopping space, food and beverage outlets, multiplex cinema and hotel in Treasure Island, Raipur in

accordance with the business plan. In terms of the SHA, the board of RTIPL shall be solely responsible for

the management, supervision, direction and control of RTIPL. DRL shall be entitled to nominate two

directors on the board of RTIPL. IEWDPL, Manish Kalani and B. Rajesh Nair shall not transfer/ encumber

any equity share such that their equity shareholding in RTIPL falls below 30%, for a period of three years

from the effective date or completion of civil construction of the project. The managing director and chief

executive officer of RTIPL shall be nominated by IEWDPL.






The shareholding pattern of RTIPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. TWDPL 669,980 67.17 2. Manish Kalani

* 10 0 3. B. Rajesh Nair

* 10 0 4. DRL 327,488 32.83

Total 997,488 100.00 *Equity shares held on behalf of TWDPL

11. Chandigarh Treasure Island Private Limited (“CTIPL”)

137


CTIPL was incorporated as „Turning Point Estates Private Limited‟ on July 25, 2006 under the Companies

Act. On September 29, 2008 the name was changed to „Chandigarh Treasure Island Private Limited‟.

CTIPL is engaged in the business of developing shopping malls, commercial complexes including

multiplex, hotel and food courts.

Shareholders agreement dated June 30, 2009 between CTIPL, Manish Kalani, TWDPL and Ochtum

River Limited (“ORL”) (the “SHA”)

CTIPL has entered into the SHA with Manish Kalani, TWDPL and ORL and has issued 486,270 equity

shares at a price of Rs. 714.29 per equity share for an amount aggregating to Rs. 347,336,130 constituting

48.81% of the paid-up equity share capital to ORL. ORL has further agreed to invest an additional amount

of Rs. 2,663,870 by subscribing to 3,729 equity shares at a price of Rs. 714.29 per equity share. TWDPL,

Manish Kalani and ORL have proposed CTIPL to undertake the development and construction of retail

shopping space, food and beverage outlet, multiplex cinema and hotel in Treasure Island, Chandigarh in

accordance with the business plan. In terms of the SHA, the board of CTIPL shall be solely responsible for

the management, supervision, direction and control of CTIPL. ORL shall be entitled to nominate two

directors on the board of CTIPL. TWDPL and Manish Kalani shall not transfer/ encumber any equity share

such that their equity shareholding in CTIPL falls below 30%, for a period of three years from the effective

date or completion of civil construction of the project. It has been stipulated that, if due to mismanagement

by TWDPL and Manish Kalani, the business expenditure exceeds 10% of the estimate provided in the

business plan, then the additional cost overruns shall be provided by TWDPL and Manish Kalani in the

form of non-convertible debt to CTIPL. ORL shall have the right to appoint an independent auditor. The

SHA provides for extinguishment of rights of the parties in the event the shareholding in CTIPL falls below

5% of the paid-up equity share capital of CTIPL.






The shareholding pattern of CTIPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. TWDPL 509,900 51.19 2. Manish Kalani

* 100 - 3. ORL 486,270 48.81 Total 996,270 100.00

*Equity shares held on behalf of TWDPL

12. Jabalpur Treasure Island Private Limited (“JTIPL”)


JTIPL was incorporated as „Entertainment World Jabalpur Private Limited‟ on June 29, 2006 under the

Companies Act. On October 08, 2008 the name was changed to „Jabalpur Treasure Island Private Limited‟.

JTIPL is engaged in the business of developing shopping malls, commercial complexes including


138

Shareholders agreement dated September 30, 2008 between JTIPL, TWDPL, Baljinder Singh

Khanna and Emmer River Limited (“ERL”) (the “SHA”)

Pursuant to the SHA, JTIPL has issued 445,856 equity shares at a price of Rs. 556.45 per equity share for

an amount aggregating to Rs. 248,097,210 constituting 30.84% of the total issued and paid-up equity share

capital to ERL. ERL has further agreed to invest an additional amount of Rs. 3,653,305 by subscribing to

3,419 equity shares at a price of Rs. 556.45 per equity share. JTIPL is engaged in undertaking the

construction and development work of Treasure Island, at Jabalpur. In terms of the SHA, the board of

JTIPL shall be solely responsible for the management, supervision, direction and control of JTIPL. ERL

shall be entitled to nominate two directors on the board of JTIPL. TWDPL and Baljinder Singh Khanna

shall not transfer/ encumber any equity share such that their shareholding in JTIPL falls below 30% and

10% respectively, for a period of three years from the effective date or completion of civil construction of

the project. The rights of ERL and Baljinder Singh Khanna shall expire if their shareholding falls below 5%

and 15% respectively of the paid-up equity share capital of JTIPL.






The shareholding pattern of JTIPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. TWDPL 750,000 51.87 2. Baljinder Singh Khanna 250,000 17.29 3. ERL 445,856 30.84 Total 1,445,856 100.00

13. Annapoorna Entertainment World Developers Private Limited (“AEWDPL”)


AEWDPL was incorporated as „Bhopal Entertainment World Developers Private Limited‟ on April 18,

2007 under the Companies Act. On October 05, 2007 the name was changed to „Annapoorna Entertainment

World Developers Private Limited‟. AEWDPL is engaged in the business of developing shopping malls,

commercial complexes including multiplex, hotel and food courts.






The shareholding pattern of AEWDPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. TWDPL 19,980 100 2. Manish Kalani

* 10 -

139


Total 20,000 100.00 * Equity shares held on behalf of TWDPL

14. Indore Treasure Market City Private Limited (“ITMCPL”)


ITMCPL was incorporated as „Five Star Developers Private Limited‟ on February 23, 2006 under the

Companies Act. On November 25, 2008 the name was changed to „Indore Treasure Market City Private

Limited‟. ITMCPL is engaged in the business of developing shopping malls, commercial complexes


Share subscription agreement dated September 23, 2006 (the “SSA”) and Shareholders‟ agreement

dated October 20, 2006 (the “SHA”) between ITMCPL, K2C Residential Limited (“K2C”), the

Company and Manish Kalani

ITMCPL has entered into the SSA and the SHA with K2C, the Company and Manish Kalani. ITMCPL has

issued 300,000 partly paid equity shares at a price of Rs. 1,901.66 per equity share for an amount

aggregating to Rs. 570,500,000 to K2C and 660,000 partly paid equity shares for an amount aggregating to

Rs. 398,058,600 to the Company constituting 30% and 66%, respectively of the equity share capital of

ITMCPL on a diluted basis. Additionally, Caravan Realty Private Limited was holding 40,000 equity

shares constituting 4% of the equity share capital of ITMCPL which were transferred to K2C on November

4, 2008. The Company, Manish Kalani and K2C proposed ITMCPL to undertake the development and

construction of residential blocks, commercial complex, shopping mall and hotel to be located at village

Khajrana, Indore. Pursuant to an amendment agreement dated November 7, 2008 among ITMCPL,

TWDPL, Manish Kalani, K2C and Weser River Limited (“WRL”), WRL has agreed to subscribe to

194,118 equity shares of ITMCPL at a price of Rs. 2,359.39.






The shareholding pattern of ITMCPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. TWDPL 704,238 56.62 2. K2C 346,813 27.89 3. WRL 192,641 15.49 Total 1,243,692 100.00

15. Udaipur Treasure Market City Private Limited (“UTMCPL”)


UTMCPL was incorporated as „Udaipur Entertainment World Private Limited‟ on January 25, 2007

under the Companies Act. On September 29, 2008, the name was changed to „Udaipur Treasure Market

City Private Limited‟. UTMCPL is engaged in the business of developing shopping malls, commercial


140


No. of equity shares of Rs.10 each




The shareholding pattern of UTMCPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)


* 10 -


Total 100,000 100.00 * Equity shares held on behalf of TWDPL

16. Dazzling Properties Private Limited (“DPPL”)


DPPL was incorporated as „Dazzling Properties Private Limited‟ on August 10, 2006 under the Companies

Act. DPPL is engaged in the business of developing shopping malls, commercial complexes including


Joint development agreement dated September 20, 2008 between DPPL, Landmark Hi Tech

Development Private Limited (“Landmark”) and TWDPL (the “JDA”)

Pursuant to the JDA, DPPL, Landmark and TWDPL, have formed Landmark Treasure Town (“LTT”), an

association of persons to undertake the planning, designing, construction, development, marketing and sale

of a multiple group housing project “Landmark Treasure Town and Treasure Vihar” in Udaipur. DPPL and

Landmark have contributed Rs. 204,000,000 and Rs. 196,000,000 respectively thereby constituting 51%

and 49% sharing ratio. In terms of the JDA, DPPL has granted irrevocable and exclusive development

rights to LTT and it is also entitled to obtain loans from banks and financial institutions by creating

equitable mortgage/ charge on the project property. LTT shall be managed and controlled by a board

constituting of four members with two representations each from DPPL and Landmark. Landmark shall

also have a right to nominate two directors on the board of DPPL. LTT shall complete the project within

three years from the signing of the JDA. Further, TWDPL has agreed to pledge the share certificates

representing its holding of 49% of the total paid-up equity share capital in DPPL with Landmark till the

completion of the project.






The shareholding pattern of DPPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)


* 100 -

141


17. Entertainment World Developers Amritsar Private Limited (“EWDAPL”)


EWDAPL was incorporated as „Entertainment World Developers Amritsar Private Limited‟ on April 11,

2007 under the Companies Act. EWDAPL is engaged in the business of developing shopping malls,







The shareholding pattern of EWDAPL is as follows:

S.

No.


Rs.10 each


equity holding (%)


* 10 -



18. Chandigarh Entertainment World Private Limited (“CEWPL”)


CEWPL was incorporated as „Chandigarh Entertainment World Private Limited‟ on January 27, 2007

under the Companies Act. CEWPL is engaged in the business of developing shopping malls, commercial







The shareholding pattern of CEWPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)


* 10 - 3. B. Rajesh Nair

* 10 -


142

19. Jodhpur Entertainment World Developers Private Limited (“JEWDPL”)


JEWDPL was incorporated as „Jodhpur Entertainment World Developers Private Limited‟ on September

10, 2007 under the Companies Act. JEWDPL is engaged in the business of developing shopping malls,







The shareholding pattern of JEWDPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)



* 10 - Total 10,000 100.00


20. Intesys Technologies Private Limited (“ITPL”)


ITPL was incorporated as „Intesys Technologies Private Limited‟ on March 7, 2008 under the Companies

Act. ITPL is engaged in the business of interior fitout of buildings, interior contracts, project management

and architecture.

Joint Venture Agreement dated February 19, 2008 between the Company, Manashi Construction

Private Limited (“MCPL”), Vikas Aggarwal and Abhik Roy Choudhury (the “JVA”)

Pursuant to the JVA, the Company, MCPL, Vikas Aggarwal and Abhik Roy Choudhury agreed to

incorporate ITPL, as a private limited company for execution of interior fit outs of malls and other

commercial buildings. The Company shall hold 51% of the Class B equity shares and MCPL, Vikas

Aggarwal and Abhik Roy Choudhury shall collectively hold 49% of the Class A equity shares. The initial

and permanent members of the board of directors of ITPL shall consist of Manish Kalani, B. Rajesh Nair,

Vikas Aggarwal and Abhik Roy Choudhury. The Company has agreed to provide an unsecured interest free

loan for working capital and initial investment in fixed assets and MCPL, Vikas Aggarwal and Abhik Roy

Choudhury has collectively agreed to provide an interest free unsecured loan for the office place and the

initial investment in setting up the head office. In terms of the JVA the Company has agreed to provide the

interior design work of the malls set up by the Company to ITPL under separate competitive item rate

contract. All the parties have agreed not to independently undertake the work which is given to ITPL,

except that MCPL, Vikas Aggarwal and Abhik Roy Choudhury are allowed to execute such work not

exceeding Rs. 200 million and shall not undertake any acoustic work in areas in which Intesys operates.


143





The shareholding pattern of ITPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. Manish Kalani* 2,600 26.00

2. B. Rajesh Nair* 2,500 25.00

3. Abhik Roy Choudhury 2,200 22.00 4. Abhik Roy Choudhury

** 500 5.00

5. Vikas Agarwal 2,200 22.00

Total 10,000 100.00 *Equity shares held on behalf of TWDPL **Equity shares held on behalf of MCPL

21. Treasure MEP Services Private Limited (“TMEP”)


TMEP was incorporated as „EWDPL Engineering Private Limited‟ on February 12, 2008 under the

Companies Act. On September 19, 2008 the name was changed to „Treasure MEP Services Private

Limited‟. TMEP is engaged in the business of execution of turnkey projects and providing consultancy

services in connection with the planning, developing, constructing, working, maintaining, modernizing,

improvising, developing of plants and machineries.






The shareholding pattern of TMEP is as follows:

S.

No.


Rs. 10 each


equity holding (%)



* 10 - Total 10,000 100


22. Treasure Food & Beverages Private Limited (“TFBPL”)


TFBPL was incorporated as „EWDPL Food & Beverages Private Limited‟ on March 13, 2008 under the

Companies Act. On September 19, 2008 the name was changed to „Treasure Food & Beverages Private

144

Limited‟. TFBPL is engaged in the business of running food courts, chains of food courts, restaurants,

chains of restaurants and hoteliers.






The shareholding pattern of TFBPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)



* 10 - Total 95,000 100.00


23. Cassandra Realty Private Limited (“CRPL”)


CRPL was incorporated as „R.M.K. Power Private Limited‟ on August 13, 1999 under the Companies Act.

On October 16, 2006 the name was changed to „Cassandra Reality Private Limited‟. On January 10, 2007

the name was further changed to „Cassandra Realty Private Limited‟. CRPL is engaged in the business of

developing shopping malls, commercial complexes including multiplex, hotel and food courts.


No. of equity shares of Rs.10 each




The shareholding pattern of CRPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. TWDPL 99,990 100

2. TWDPL jointly with Manish Kalani 10 -

Total 100,000 100.00

24. Treasure Hospitality Private Limited (“THPL”)


THPL was incorporated as „EWDPL Raipur Hospitality Private Limited‟ on March 13, 2008 under the

Companies Act. On September 19, 2008 the name was changed to „Treasure Hospitality Private Limited‟.

THPL is engaged in the business of running hotels, spa, resorts and motels, recreations centre, amusement

and entertainment parks, restaurants, picnic spots.

145






The shareholding pattern of THPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)



* 10 - Total 10,000 100.00

* Equity shares held on behalf of TWDPL

25. Indore Treasure Town Private Limited (“ITTPL”)


ITTPL was incorporated as „21st Centuri Properties Private Limited‟ on February 23, 2006 under the

Companies Act. On July 3, 2006 the name was changed to „Twenty First Century Properties Private

Limited‟. The name was further changed to „Indore Treasure Town Private Limited‟ on December 29,

2008. ITTPL is engaged in the business of acquiring land for residential, business, industrial, commercial,

agricultural, or other purposes and preparing building sites, constructing, reconstructing, decorating,

improving, altering, furnishing and maintaining Shopping Malls, offices, flats, houses, factories, cinema

theatres, opera houses, auditoriums, warehouses.

Share subscription agreement dated September 23, 2006 between ITTPL, K2C Residential Limited

(“K2C”), the Company and Manish Kalani (the “SSA”)

ITTPL has issued 900,000 class A equity shares of Rs. 10 each for an amount aggregating to Rs.

625,665,108 to the Company and 525,000 class B equity shares and 75,000 class A equity shares to K2C

for an amount aggregating to Rs. 401,186,500 constituting 60% and 40%, respectively of the paid-up equity

share capital of ITTPL under the SSA and supplementary agreement dated January 31, 2009. Additionally,

Caravan Realty Private Limited was holding 50,000 class A equity shares constituting 5% of the equity

share capital of ITTPL which were transferred to K2C on November 4, 2008. The Company, Manish

Kalani and K2C have proposed ITTPL to undertake the development and construction of a residential

township to be located in Bijalpur, Indore.






The shareholding pattern of ITTPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. TWDPL 900,000 60.00

146

2. K2C 600,000 40.00 Total 1,500,000 100.00

26. Wanderland Real Estates Private Limited (“WREPL”)


WREPL was incorporated as „Wanderland Real Estates Private Limited‟ on February 24, 2006, under the

Companies Act. WREPL is engaged in the business of acquiring land for residential, business, industrial,

commercial, agricultural, or other purposes and preparing building sites, constructing, reconstructing,

decorating, improving, altering, furnishing and maintaining Shopping Malls, offices, flats, houses,

factories, cinema theatres, opera houses, auditoriums, warehouses.






The shareholding pattern of WREPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. Kalani Industries Private Limited 37,250 7.10 2. Patwari Real Estates Private Limited 31,000 5.90 3. Padma Kalani 45,000 8.57 4. Namita Kalani 10,500 2.00

5. P. S. Kalani 5,500 1.05

6. Manisha Kalani 26,250 5.00

7. Yuvraj Trust 26,250 5.00

8. Ridhima Family Trust 26,250 5.00

9. Vinayak Kalani 26,250 5.00

9. TWDPL 267,750 51.00

10. Manish Kalani 9,000 1.71

11. P. S. Kalani (HUF) 5,000 0.95

12. Manish Kalani (HUF) 9,000 1.71

Total 525,000 100.00

27. Pune Entertainment World Developers Private Limited (“PEWDPL”)


PEWDPL was incorporated as „Pune Entertainment World Developers Private Limited‟ on April 19, 2007

under the Companies Act. PEWDPL is engaged in the business of developing shopping malls, residential

township, commercial complexes including multiplex, hotel and food courts.





147


The shareholding pattern of PEWDPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. ITTPL 9,980 100 2. Manish Kalani


* 10 - Total 10,000 100.00

*Equity shares held on behalf of ITTPL

28. Entertainment World Developers Bijalpur Private Limited (“EWBDPL”)


EWBDPL was incorporated as „Entertainment World Developers Bijalpur Private Limited‟ on January 17,

2007 under the Companies Act. EWBDPL is engaged in the business of developing shopping malls,

residential township, commercial complexes including multiplex, hotel and food courts.






The shareholding pattern of EWBDPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. ITTPL 9,980 100 2. Manish Kalani


* 10 - Total 10,000 100.00

*Equity shares held on behalf of ITTPL

29. Banglore Entertainment World Developers Private Limited (“BEWDPL”)


BEWDPL was incpororated as „Banglore Entertainment World Developers Private Limited‟ on April 3,

2008 under the Companies Act. BEWDPL is engaged in the business of developing shopping malls,

residential township, commercial complexes including multiplex, hotel and food court.






The shareholding pattern of BEWDPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. TWDPL 9,980 100

148

2. TWDPL jointly with Manish Kalani 20 - Total 10,000 100.00

Joint Venture

Naman Mall Management Company Private Limited (“NMMCPL”)


NMMCPL was incorporated as „Naman Mall Management Company Private Limited‟ on June 2, 2005

under the Companies Act. NMMCPL is engaged in the business of development of shopping mall,







The shareholding pattern of NMMCPL is as follows:

S.

No.


Rs. 10 each


equity holding (%)

1. EWDL 390,000 50 2. Kshitij Venture Capital Fund 390,000 50 Total 780,000 100.00

Association of Persons

Landmark Treasure Town (“Landmark”)


Landmark is an unincorporated joint venture arrangement of the TWDPL, Dazzling Properties Private

Limited and Landmark Hi Tech Development Private Limited on September 20, 2008 to undertake the

exclusive construction, development, marketing and sale of the multiple group housing project at village

Badgaon, Udaipur, Rajasthan.

The Capital contribution in Landmark is as follows:

S.

No.

Name of the Shareholder Capital

Contribution

Percentage of total

Capital Contribution

(%)

1. Dazzling Properties Private Limited 204,000,000 51.00

2. Landmark Hi Tech Development Company

Private Limited

196,000,000 49.00

Total 400,000,000 100.00

149

PROMOTERS AND PROMOTER GROUP

Promoters

Manish Kalani, Padma Homes Private Limited and Kalani Brothers (Indore) Private Limited are the Promoters of

the Company.

Details of individual Promoter

Manish Kalani is the Managing Director of the Company. He is a resident Indian

national. For further details, see “Management” on page 113 of this Draft Red Herring

Prospectus.

The driving license number of Manish Kalani is MP09R-2009-0580329 and his voter

identification number is LHV3458247.

We confirm that the permanent account number, bank account number and passport

number of Manish Kalani shall be submitted to the Stock Exchanges, at the time of

filing the Draft Red Herring Prospectus with them.

Details of corporate Promoters

1. Padma Homes Private Limited (“PHPL”)

PHPL was incorporated under the Companies Act on January 31, 2002. The registered office of PHPL is

situated at 11, Tukoganj, Main Road, Indore 452 001. PHPL is involved in the business of dealing in real

estate and properties.

Board of Directors:

1. Padma Kalani;

2. B. Rajesh Nair; and

3. S.K. Talati

Shareholding Pattern of PHPL is as follows:

S. No Name of the Shareholder No. of Equity Shares held Percentage

1. Kartikey Family Trust 30,000 12.21

2. Manisha Kalani 73,468 29.90

3. Padma Kalani 73,413 29.88

4. S. F. Trust 34,823 14.17

5. Vinayak Family Trust 33,986 13.83

Total 245,690 100.00

Financial Performance

(Rs. in million except share data)

Particulars Fiscal 2010 Fiscal 2009 Fiscal 2008

Sales and Other Income 0.03 0.03 0.06

PAT (0.31) (0.19) (0.21)

Equity Capital 2.45 2.46 2.46

Reserves (excluding revaluation

reserves)

Nil Nil Nil

EPS (Rs.) (1.27) (0.80) (0.88)

Book Value (Rs.) 6.65 7.92 8.72

150

Promoter of PHPL

Padma Kalani, Manisha Kalani, Kartikey Family Trust, S.F. Trust and Vinayak Family Trust are the

promoters of PHPL.

Other Information

PHPL is an unlisted company. PHPL is neither a sick company within the meaning of Sick Industrial

Companies (Special Provisions) Act, 1985 nor is under the process of winding up. PHPL had no negative

net worth as of the date of the respective last audited financial statements.

There has been no change in the management or in the persons holding controlling interest in PHPL since

incorporation.

The Company confirms that the permanent account number, bank account number, company registration

number and the address of the registrar of companies where PHPL is registered shall be submitted to the

Stock Exchanges at the time of filing the Draft Red Herring Prospectus.

2. Kalani Brothers (Indore) Private Limited (“KBIPL”)

KBIPL was incorporated under the Companies Act on December 28, 1959. The registered office of KBIPL

is situated at 11 Tukoganj, Main Road, Indore 452 001. KBIPL is involved in dealing of real estate and

properties.

Board of Directors:

1. Padma Kalani;

2. B. Rajesh Nair;

3. N.K. Malviya; and

4. S.K. Talati

Shareholding Pattern of KBIPL is as follows:

S.

No.


1. Kalani Family Trust 144,300 2.89

2. Kartikey Family Trust 610,500 12.22

3. Manish Saurabh Trust 144,300 2.89

4. Manisha Kalani 1,365,300 27.33

5. Padma Kalani 1,365,300 27.33

6. Ridhima Family Trust 754,800 15.11

7. Vinayak Family Trust 610,500 12.22

Total 4,995,000 100.00

Financial Performance

(Rs. in million except share data)


Sales and Other Income 2.77 2.41 2.23

PAT 1.35 0.003 1.21


Reserves (excluding revaluation

reserves)

94.67 93.32 93.31

EPS (Rs.) 0.27 0.001 0.24

Book Value (Rs.) 28.95 28.68 28.68

151

Promoters of KBIPL

Padma Kalani, Manisha Kalani, Kartikey Family Trust, Vinayak Family Trust, Kalani Family Trust,

Manish Saurabh Trust and Ridhima Family Trust are the promoters of KBIPL.

Other Information

KBIPL is an unlisted company. KBIPL is neither a sick company within the meaning of Sick Industrial

Companies (Special Provisions) Act, 1985 nor is under the process of winding up. KBIPL had no negative

net worth as of the date of the respective last audited financial statements.

There has been no change in the management or in the persons holding controlling interest in KBIPL since

incorporation.

The Company confirms that the permanent account number, bank account number, company registration

number and the address of the registrar of companies where KBIPL is registered shall be submitted to the

Stock Exchanges at the time of filing the Draft Red Herring Prospectus.

Interests of Promoters and Common Pursuits

The Promoters are interested to the extent of their shareholding in the Company. For details of the Promoters‟

shareholding in the Company, see “Capital Structure” and “Management” on pages 26 and 113 of this Draft Red

Herring Prospectus, respectively.

Further, the individual Promoter who is also a Director may be deemed to be interested to the extent of fees, if any,

payable to him for attending meetings of the Board or a Committee thereof as well as to the extent of other

remuneration, reimbursement of expenses payable to him. For further details, see “Management” on page 113 of this


Further, the individual Promoter is also a director on the boards, or is a member, or is a partner, of certain Promoter

Group entities and may be deemed to be interested to the extent of the payments made by the Company, if any, to

these Promoter Group entities. For the payments that are made by the Company to certain Promoter Group entities,

see “Related Party Transactions” on page 160 of this Draft Red Herring Prospectus.

Except as stated otherwise in this Draft Red Herring Prospectus, the Company has not entered into any contract,

agreements or arrangements during the preceding two years from the date of this Draft Red Herring Prospectus in

which the Promoter is directly or indirectly interested and no payments have been made to him in respect of the

contracts, agreements or arrangements which are proposed to be made with him including the properties purchased

by the Company other than in the normal course of business.

Further, the Promoter does not have any interest in any venture that is involved in any activities similar to those

conducted by us except as disclosed in this section and “Group Companies” on page 155 of this Draft Red Herring

Prospectus.

Payment of benefits to Promoters

Except as stated in “Related Party Transactions” on page 160 of this Draft Red Herring Prospectus, there has been

no payment of benefits to the Promoters during the two years prior to the filing of this Draft Red Herring Prospectus.

Confirmations

Further, none of the Promoters has been declared as a wilful defaulter by the RBI or any other governmental

authority and there are no violations of securities laws committed by the Promoters in the past or are pending against

them. However, Gilt Pack Limited, a public limited company, promoted by P. S. Kalani (father of Manish Kalani)

and Saurabh Kalani (brother of Manish Kalani) defaulted on certain loans and was wound up by an order of the

Board for Industrial and Financial Reconstruction in 1991. Pursuant to this event, P. S. Kalani, being the promoter of

152

Gilt Pack Limited, was included in the list of wilful defaulters by RBI.

Companies with which Promoters have disassociated in the last three years

None of the Promoters have disassociated with any companies in the last three years.

Promoter Group

1. Natural persons who are part of the Promoter Group

The natural persons who are part of the Promoter Group (due to their relationship with Manish Kalani),

other than the Promoter are as follows:

Name Relationship with Promoter

P.S. Kalani Father Padma Kalani Mother Manisha Kalani Wife

Saurabh Kalani Brother

Ridhima Kalani Daughter

Deepak Dhar Gupta Father of the spouse

Usha Gupta Mother of the spouse

Jai Dhar Gupta Brother of the spouse

Mandira Malhotra Sister of the spouse

2. Corporate entities forming part of the Promoter Group

S. No Name of the Entity

1. Anshuman Properties Private Limited

2. Chitrakoot Mercantiles Private Limited

3. Ecstasy Heights Private Limited

4. Excellence Properties Private Limited

5. Gemini Heights Private Limited

6. High Beam Reality Private Limited

7. High-Skey Properties Private Limited

8. Kalani Industries Private Limited

9. Samarpit Developers Private Limited

10. TI Travels Private Limited

11. Wanderland Constructions Private Limited

12. Crystal 3 Power Private Limited

13. Flexituff International Limited

14. Four Dimension Properties Private Limited

15. Ratangiri Vinimay Private Limited

16. Ambika Commercial Private Limited

17. Indore Land and Finance Private Limited

18. Herbal Dream Ayurveda Creations Private Limited

19. Satguru Polyfab Private Limited

20. Triple A Real Estates Private Limited

21. Nanofil Technologies Private Limited

22. Saka Tradings Private Limited

23. Saurabh Properties Private Limited

153


24. Seven Star Properties Private Limited

25. Sunrise Properties Private Limited

26. Vibgyor Laminates Private Limited

27. MRK Pipes Limited

28. Vindhya Cement Private Limited

29. Dumet Wire India Private Limited

30. Fab Syntex Private Limited

31. Fantasy Real Estates Private Limited

32. Gagan Commercial Agencies Limited

33. Dreamworld Developers Private Limited

34. Pusti Trading Private Limited

35. Sanovi Trading Private Limited

36. Skyline Advisory Services Private Limited

37. Triple A Constructions Private Limited

38. Miscellani Global Private Limited

39. Olive Commercial Company Limited

40. Kartikey Family Trust

41. Ridhima Family Trust

42. S. F. Trust

43. Vinayak Family Trust

44. B.N.Kalani & Sons HUF

45. Prem Swarup Kalani HUF

46. Prem Swarup Manish Kalani HUF

47. Manish Kalani HUF

Further, the following entities have been included in the Promoter Group in accordance with Regulation

2(zb)(iii)(C) of the SEBI Regulations. None of these entities, except Kalani Holdings Private Limited (a

wholly owned subsidiary of PML), hold any equity shares in the Company or have any other interest in the

Company as on the date of this Draft Red Herring Prospectus. Further, none of the Promoters of the

Company holds any shares or has any other interest in any of the entities mentioned below, as on the date



1. Pinnacle Real Estate Development Private Limited

2. Market City Resources Private Limited

3. Classic Mall Development Company Private Limited

4. Starboard Hotels Private Limited

5. Offbeat Developers Private Limited

6. Island Star Mall Developers Private Limited

7. Vamona Developers Private Limited

8. Juniper Developers Private Limited

9. Escort Developers Private Limited

10. Palladium Constructions Private Limited

11. Kalani Holdings Private Limited (a wholly owned subsidiary of PML)

12. Market City Management Private Limited

13. Bellona Finvest Limited

154


14. Pallazzio Hotels & Leisure Limited

15. Big Apple Real Estate Private Limited

16. Plutocrat Assets & Capital Management Private Limited

17. Bartraya Mall Development Private Limited

18. Ramayana Realtors Private Limited

19. Picasso Developers Private Limited

155

GROUP COMPANIES

Companies forming part of Group Companies

Unless otherwise stated, none of the companies forming part of Group Companies is a sick company under the

meaning of SICA and none of them are under winding up. Further, all the Group Companies are unlisted companies

and they have not made any public issue of securities in the preceding three years.

The Group Companies of our Company are as follows:

S.no Name of the Company

1. Flexituff International Limited

2. MRK Pipes Limited

3. Triple A Real Estates Private Limited

4. Fantasy Real Estates Private Limited

5. Dreamworld Developers Private Limited



The details of the Group Companies are set forth below:

1. Flexituff International Limited (“FIL”)


FIL was incorporated on April 08, 1993 under the Companies Act. The registered office of FIL is situated

at 2nd

Floor, Main Building, Dr. R R Mukerjee Road, Kolkata, 700001. FIL is engaged in the business of

manufacture of woven polypropylene fabric and its products.

Interest of the Promoter

Manish Kalani, one of the Promoters of the Company is the managing director of FIL. None of the

Promoters of the Company hold any equity shares in FIL other than Manish Kalani, who holds 11,400

Equity Shares aggregating to 0.1% of the equity share capital of FIL.

Financial Information (In Rs. million, except share data)


Equity Capital 113.14 110.91 26.98

Reserves (excluding revaluation reserves) and surplus 573.17 469.53 391.39

Income (including other income) 2618.06 2239.78 1690.63

Profit After Tax 81.52 76.23 82.06

Earning Per Share (face value Rs. 10 each) (Basic) 7.13 11.94 39.81

Net asset value per share 60.66 52.33 155.08

2. MRK Pipes Limited (“MRKPL”)


MRKPL was incorporated on July 31, 2000 under the Companies Act. The registered office of MRKPL is

situated at Parasrampuria Chambers, opposite Road No. 1, VKI Area, Jaipur 302 013. MRKPL is engaged

in the business of manufacturing, producing, buying and selling all types of pipes and ancillary businesses.

156


Manish Kalani, one of the Promoters of the Company holds 364,010 equity shares aggregating to 7.28% of

the issued and paid up capital of MRKPL.



Equity Capital 158.63 93.34 106.22



Profit After Tax 4.79 4.62 1.16

Earning Per Share (face value Rs. 10 each) 0.96 0.92 0.23


3. Triple A Real Estates Private Limited (“TREPL”)


TREPL was incorporated on January 10, 1990 under the Companies Act. The registered office of TREPL is

situated at 161, Suniket Apartment, Khajrana Road, Indore 452010. TREPL is engaged in the business of

Builder, Developers and construction and ancillary business.


Manish Kalani, one of the Promoters of the Company holds 901 equity shares of Rs. 100 each aggregating

to 90.10% of the issued and paid up capital of TREPL.






Profit After Tax 0.48 (0.02) (0.01)

Earning Per Share (face value Rs. 10 each) 47.89 (2.45) (0.81)


4. Fantasy Real Estates Private Limited (“FREPL”)


FREPL was incorporated on February 20, 2007 under the Companies Act. The registered office of FREPL

is situated at G-16, R. R. Hosiery Building, Shree Laxmi Woolen Mills, Off. Dr. E. Moses Road,

Mahalaxmi, Mumbai. FREPL is involved in dealing in real estate and ancillary businesses.


Manish Kalani, one of the Promoters of the Company was the intial subscriber to the memorandum of

association of FREPL. None of the Promoters of the Company hold any equity shares in FREPL.

157


Particulars Fiscal 2009 Fiscal 2008

One month

period ended

March 31,

2007


Reserves (excluding revaluation reserves) and surplus

(net of P&L debit balance)

0.03 (0.20) (0.00)


Profit After Tax 0.23 (0.197) (0.003)

Earning Per Share (face value Rs. 10 each) 2.05 (19.69) (0.30)

Net asset value per share 10.08 (11.93) 7.52

5. Dreamworld Developers Private Limited (“DDPL”)


DDPL was incorporated on June 26, 2006 under the Companies Act. The registered office of DDPL is

situated at 161-162, Suniket Apartment, Shree Nagar Extension, Khajrana Main Road, Indore 452 001.

DDPL is engaged in the business of constructing shopping malls, multiplex and hotels.


Manish Kalani, one of the Promoters of the Company holds 900 equity shares aggregating to 9% of the

issued and paid up capital of DDPL.




Reserves (excluding revaluation reserves) and

surplus

0.00 0.00 0.00


Profit After Tax 0.03 (0.02) (0.009)

Earning Per Share (face value Rs. 10 each) 3.24 (2.32) (.91)


6. Four Dimension Properties Private Limited (“FDPPL”)


FDPPL was incorporated on October 22, 1996 under the Companies Act. The registered office of FDPPL is

situated at B-4, Parekh Apartment, Ground Floor, Sarojani Road, Vile Parle (West), Mumbai 400 056.

FDPPL is engaged in the business of Builder, Developers and construction and ancillary business.


Manish Kalani, one of the Promoters of the Company holds 18,100 equity shares aggregating to 90.50% of

the issued and paid up capital of FDPPL.




158

Reserves (excluding revaluation reserves) and

surplus (net of P&L debit balance)

0.00 0.00 0.00


Profit After Tax (0.41) (0.02) 0.004

Earning Per Share (face value Rs. 10 each) (20.47) (1.05) 0.21

Net asset value per share* (16.55) 3.91 4.97 *NAV per share is negative for FY 2009 on account of miscellaneous expenditure incurred.

7. Crystal 3 Power Private Limited (“CPPL”)


CPPL was incorporated on August 22, 2008 under the Companies Act. The registered office of CPPL is

situated at 2nd

Floor, Main Building, 19 R.N. Mukherjee Road, Kolkata 700 001. CPPL is engaged in the

business of building, erecting, constructing, establishing, maintaining, improving, managing and operating

electricity generating station and ancillary businesses.


Manish Kalani, one of the Promoters of the Company was one of the first directors of CPPL. None of the

Promoters of the Company hold any equity shares in CPPL.


Particulars Fiscal 2009

Equity Capital 0.10

Reserves (excluding revaluation reserves) and surplus (net of P&L debit

balance)

0.00

Income (including other income) 0.00

Profit After Tax 0.00

Earning Per Share (face value Rs. 10 each) 0.00

Net asset value per share* (27.96) *NAV per share is negative for FY 2009 on account of miscellaneous expenditure incurred.

The Group Companies with negative net worth are as follows:


For details in relation to Four Dimension Properties Private Limited, see “Group Companies” on page 155



For details in relation to Crystal 3 Power Private Limited, see “Group Companies” on page 155 of this


Nature and Extent of Interest of Promoter and Group Companies

(a) In the promotion of our Company

None of our Group Companies have any interest in the promotion of our Company.

(b) In the properties acquired or proposed to be acquired by our Company in the past two years before filing

the Draft Red Herring Prospectus with SEBI

159

Other than KBIPL and PHPL, neither our Promoter nor any of our Group Companies is interested in the

properties acquired or proposed to be acquired by our Company in the two years preceding the filing of the


(c) In transactions for acquisition of land, construction of building and supply of machinery

Neither our Promoter nor any of our Group Companies is interested in any transactions for the acquisition

of land, construction of building or supply of machinery.

Common Pursuits amongst the Group Companies and Associate Companies with our Company

There are no common pursuits amongst any of our Group Companies and our Company.

Related Business Transactions within the Group Companies and Significance on the Financial Performance

of our Company

For details, see “Related Party Transactions” on page 160 of this Draft Red Herring Prospectus.

Sale/Purchase between Group Companies, Subsidiaries and Associate Companies

For details, see “Related Party Transactions” on page 160 of this Draft Red Herring Prospectus.

Business Interest of Group Companies, Subsidiaries and Associate Companies in our Company

We have entered into certain business contracts with our subsidiaries. For details, see “Related Party Transactions”

on page 160 of this Draft Red Herring Prospectus. None of our Group Companies and associate companies have any

business interest in our Company.

Defunct Group Companies

None of our Group Companies remain defunct and no application has been made to the registrar of companies for

striking off the name of any of our Group Companies, during the five years preceding the date of filing the Draft

Red Herring Prospectus with SEBI. None of our Group Companies fall under the definition of sick companies under

SICA and none of them is under winding up.

Public issue or rights issue

None of our Group Companies has made any public or rights issue in the last three years preceding the date of filing

the Draft Red Herring Prospectus.

160

RELATED PARTY TRANSACTIONS

For details of the related party transactions, please see “Consolidated Summary Statement of Related Party

Disclosures” and “Unconsolidated Summary Statement of Related Party Disclosures” on pages 207 and 252,

respectively.

161

DIVIDEND POLICY

The declaration and payment of dividends will be recommended by Board and approved by the shareholders, in their

discretion, and will depend on a number of factors, including, but not limited to our earnings, capital requirements

and overall financial position. The Company has no stated dividend policy and has not declared any dividends in the

last five years.

In addition, our ability to pay dividends may be impacted by a number of factors, including restrictive covenants

under the loan or financing arrangements we may enter into to finance our expansion plans and also the funding

requirements for our expansion plans.

162

SECTION V: FINANCIAL INFORMATION


AUDITOR‟S REPORT

To,

The Board of Directors,

Entertainment World Developers Limited

(Formerly known as Entertainment World Developers Private Limited)

G-16, R.R.Hosiery Building,



Off Dr. E. Moses Road,

Mahalaxmi, Mumbai- 400 011

Dear Sirs,

Re: Proposed initial public offer of equity shares having a face value of Rs. 10/- each for cash, at an issue

price to be arrived at by the book building process (referred as the „Offer‟).

We have reviewed and examined the consolidated financial information of Entertainment World Developers Limited

(Formerly known as Entertainment World Developers Private Limited) („EWDL‟ or „the Company‟) annexed to this

report and initialed by us for identification. The consolidated financial information has been prepared in accordance

with the requirements of Part II of Schedule II to the Companies Act, 1956 („the Act‟), the Securities and Exchange

Board of India („SEBI‟) – (Issue of Capital and Disclosure Requirements) Regulations, 2009 (the „ICDR

Regulations‟) and terms of engagement agreed upon by us with the Company. The consolidated financial

information has been prepared by the Company and approved by its Board of Directors.

A. Consolidated Financial Information:

The consolidated financial information referred to above, relating to profits and losses and assets and liabilities

of EWDL is contained in Annexures I, II, III and IV to this report:

a) Annexure I contains Consolidated Summary Statement of Assets and Liabilities, as restated as at March

31, 2010, 2009, 2008, 2007, 2006;

b) Annexure II contains Consolidated Summary Statement of Profits and Losses, as restated for the years

ended March 31, 2010, 2009, 2008, 2007, 2006;

c) Annexure III contains Consolidated Summary Statement of Cash Flows, as restated for the years ended

March 31, 2010, 2009, 2008, 2007, 2006;

d) Annexure IV contains the Summary of Significant Accounting Policies and Notes to Consolidated

Summary Statements, as restated.

B. Other Consolidated Financial Information:

Other consolidated financial information relating to EWDL prepared by the Company is attached in Annexures V to

XXII to this report:

a) Consolidated Summary Statement of Share Capital, as restated (Annexure V).

b) Consolidated Summary Statement of Reserves and Surplus, as restated (Annexure VI)

c) Consolidated Summary Statement of Secured Loans, as restated (Annexure VII)

d) Consolidated Summary Statement of Unsecured Loans, as restated (Annexure VIII)

163

e) Consolidated Summary Statement of Inventories, as restated (Annexure IX)

f) Consolidated Summary Statement of Fixed Assets, as restated (Annexure X)

g) Consolidated Summary Statement of Sundry Debtors, as restated (Annexure XI)

h) Consolidated Summary Statement of Loans and Advances, as restated (Annexure XII)

i) Consolidated Summary Statement of Cash and Bank Balances, as restated (Annexure XIII)

j) Consolidated Summary Statement of Investments, as restated (Annexure XIV)

k) Consolidated Summary Statement of Current Liabilities and Provisions, as restated (Annexure XV)

l) Consolidated Summary Statement of Income from Operations and Other Income, as restated (Annexure

XVI)

m) Consolidated Summary Statement of Construction Expenses, as restated (Annexure XVII)

n) Consolidated Summary Statement of Employee Remuneration and Benefits, as restated (Annexure XVIII)

o) Consolidated Summary Statement of Operating and Other Expenses, as restated (Annexure XIX)

p) Consolidated Summary Statement of Interest and Finance Charges, as restated (Annexure XX)

q) Consolidated Summary Statement of Related Party Disclosures, as restated (Annexure XXI)

r) Consolidated Capitalisation Statement, as restated (Annexure XXII).

s) Consolidated Summary Statement of Accounting Ratios, as restated (Annexure XXIII).

t) The Company has not declared any dividend (whether interim or final) during the financial years covered

in this report and hence the information regarding rates of dividend in respect of each class of shares has

not been disclosed;

C. We have reviewed and examined, as appropriate, the consolidated financial information contained in the

aforesaid Annexures and are to state as follows:

i. The consolidated financial information contained in these Annexures is based on the audited consolidated

financial statements of the Company for the years ended March 31, 2010, 2009, 2008, 2007 and 2006.

ii. The Consolidated Summary Statement of Assets and Liabilities, Profits and Losses and Statement of Cash

Flows have been restated with retrospective effect to reflect the Significant Accounting Policies being

adopted by the Company as at March 31, 2010, if material.

D. We did not audit the financial statements of the following for the years ended March 31, 2010, 2009, 2008 and

2007:

i. Certain subsidiaries, whose financial statements reflect total assets of Rs. 2,910.31 million, Rs. 2,971.77

million, Rs. 1469.97 million and 309.46 million as at March 31, 2010, 2009, 2008 and 2007 respectively,

total revenues of Rs. 287.66 million, Rs. 179.70 million, Rs. 0.08 million and Rs. 0.33 million and net cash

(outflows) / inflows amounting to (Rs. 5.24 million), Rs. 13.05 million, Rs. 9.42 million and (Rs. 21.63

million) for the financial years ended March 31, 2010, 2009, 2008 and 2007 respectively. Certain associates

whose financial statements reflect the Group‟s share of loss (net) of Rs. 0.16 million and Rs. 0.03 million

for the financial year ended March 31, 2010 and 2009, respectively.

Those financial statements have been audited by other auditors whose reports have been furnished to us by

the Management of the Company, and our opinion is based solely on the reports of the other auditors.

ii. Financial Statements of a joint venture, which reflect the Group‟s share of total assets of Rs. 140.23 million

as at March 31, 2007 and net cash outflows amounting to Rs. 28.81 million for the year ended on that date.

Those financial statements have been audited by M/s Shankarlal Jain and Associates, Chartered

Accountants whose report has been furnished to us by the Management of the Company, and our opinion is

based solely on the report of the other auditors.

iii. Financial Statements of the Company for the year ended March 31, 2006 which have been audited by M/s

M. Munshi & Company, Chartered Accountants. We have relied on these financial statements for the year

ended March 31, 2006 which have been audited by the other auditors for the purpose of this report.

164

E. In our opinion, the consolidated financial information of the Company attached to this report and contained in

the aforesaid Annexures has been prepared in accordance with Part II of Schedule II of the Act and the ICDR

Regulations.

F. This report is intended for your information and for inclusion in the Offer Document being issued by the

Company with regard to the aforesaid proposed initial public offer of equity shares of the Company for cash and

is not to be used, referred to or distributed for any other purpose without our prior written consent.

For Deloitte Haskins & Sells

Chartered Accountants

(Firm‟s Registration No.: 117366W)

A. B. Jani

Mumbai Partner

Dated: June 11, 2010 Membership No.: 46488

165

ANNEXURE I

CONSOLIDATED SUMMARY STATEMENT OF ASSETS AND LIABILITIES, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

A FIXED ASSETS

Gross Block 3,733.19 2,474.38 2,004.17 1,444.38 660.43

Less: Depreciation/ Amortization 155.27 102.92 62.81 30.94 6.30

Net Block 3,577.92 2,371.46 1,941.36 1,413.44 654.12

Capital Work- In- Progress 5,017.18 4,447.12 1,842.22 570.16 53.71

Total (A) 8,595.10 6,818.58 3,783.58 1,983.60 707.83

B INVESTMENTS (B) 123.01 119.51 83.27 105.10 -


ADVANCES

Inventories 3,078.60 2,467.66 1,435.39 291.32 -

Sundry Debtors 385.65 33.26 38.96 13.53 14.00

Cash and Bank Balances 795.61 1,246.85 281.29 117.66 24.86

Loans and Advances 1,221.46 1,048.99 1,301.19 495.73 468.18

Total (C) 5,481.32 4,796.76 3,056.83 918.24 507.04


Current Liabilities 1,276.58 1,452.99 452.65 137.53 105.96

Provisions 28.85 14.60 4.52 3.16 0.70

Deferred Tax Liability 4.50 1.77 - - -

Secured Loans 5,065.61 3,147.27 1,836.97 1,066.28 706.22

Unsecured Loans 4,059.91 4,029.95 2,293.53 560.00 4.77



224.38 210.27 136.20 111.96 66.63

Total (D) 10,659.83 8,856.85 4,723.87 1,878.93 884.28

E Net Worth (A+B+C-

D)

3,539.60 2,878.00 2,199.81 1,128.01 330.59

F Represented by:

1) Share Capital 158.46 158.46 158.46 140.39 102.83


3) Reserves and Surplus

(a) Securities Premium Account 1,364.43 1,265.03 902.50 767.45 111.88

(b) General Reserve 6.00 6.00 - - -

(c) Profit and Loss Account - - - 6.05 -

Total [(1)+(2)+(3)] 1,528.89 1,526.99 1,940.95 976.62 343.54

Less: Debit balance in Profit and

Loss Account

(16.98) (142.72) (13.86) - (12.95)

Minority Interest 2,027.69 1,493.73 272.72 151.39 -

166


2010 2009 2008 2007 2006

G Net Worth 3,539.60 2,878.00 2,199.81 1,128.01 330.59

The accompanying Summary of Significant Accounting Policies and Notes to Consolidated Summary Statements


167

ANNEXURE II

CONSOLIDATED SUMMARY STATEMENT OF PROFIT AND LOSS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

INCOME

Income From Operations 1,020.01 389.09 265.32 218.36 26.05

Other Income 42.33 34.59 16.75 13.23 0.10

Total Income 1,062.34 423.68 282.07 231.59 26.15

EXPENDITURE




Interest 199.19 207.41 86.74 78.98 -

Depreciation/ Amortization 46.23 52.72 41.51 36.08 8.60


PROFIT/ (LOSS) BEFORE TAX 178.26 (118.22) (30.20) (15.21) 9.54


Current Tax 27.18 29.83 2.49 1.55 0.80

Deffered Tax 2.85 1.77 - - -

Wealth Tax 0.08 0.04 0.05 0.03 -

Fringe Benefits Tax - 1.64 1.73 1.00 0.35

Net Profit / (Loss) Before Minority Interest and Share from

Associates

148.15 (151.50) (34.47) (17.79) 8.39

Share of loss from Associates 0.16 (0.05) (0.10) - -

Minority Interest 22.25 12.99 (2.07) (0.01) -


Associates

125.74 (164.54) (32.50) (17.78) 8.39


( Refer Note B.2 of Annexure IV)

- 35.68 12.59 36.78 (21.34)


Associates, as Restated

125.74 (128.86) (19.91) 19.00 (12.95)

Balance brought forward from previous year (142.72) (13.86) 6.05 (12.95) -

BALANCE CARRIED FORWARD, AS RESTATED (16.98) (142.72) (13.86) 6.05 (12.95)

168

ANNEXURE III

CONSOLIDATED SUMMARY STATEMENT OF CASH FLOWS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006


Profit Before Tax 178.26 (82.54) (17.61) 21.57 (11.80)

Adjustments for:

Depreciation 46.23 38.40 28.92 23.73 5.51

Preliminary Expenses Written off - 0.19 - - 0.82

General reserve on account of land - 6.00 - - -

Loss on sale of Fixed Assets (Net) 0.77 0.45 0.40 0.11 -

Interest Income (10.68) (23.93) (6.11) (4.27) (0.10)

Dividend on Current Investments (0.06) (0.52) (2.92) (3.85) -


Profit on sale of Subsidiaries (20.29) - - - -




Capital Work in Progress Written off - 1.74 1.91



(Increase) / Decrease in receivables (354.21) 4.93 (26.64) 0.85 (14.00)

(Increase) / Decrease in loans and advances (139.36) 359.96 (679.69) (10.98) (446.97)

(Increase) / Decrease in inventories (610.94) (732.23) (1,159.96) (277.98) -

(Decrease) / Increase in provision (0.62) 2.41 (0.42) 2.23 -

(Decrease) / Increase in payables (164.86) 868.01 315.11 31.58 99.51

Cash (used in)/ generated from operations (877.89) 650.53 (1,460.34) (138.40) (367.02)

Less: Taxes (paid)/refund (41.61) (46.29) (34.17) (27.64) (0.35)

Net Cash Flow (used in)/ generated from

Operating Activities

(919.50) 604.24 (1,494.51) (166.04) (367.38)


Share application money pending allotment - 69.58 (94.58) 11.44 -


Purchase of fixed assets (1,858.70) (3,071.10) (1,814.56) (1,212.49) (292.58)

Investment in Associate Companies (3.33) - - (41.67) -


Companies

22.09 - - - -

Purchase Consideration paid on acquisition of

interest in subsidiary

(7.95) (0.00) (112.70) -

Purchase of Current Investments (0.16) (1,435.90) (1,712.94) (2,989.04) -

Sale of Current Investments - 1,470.97 1,740.41 2,927.27 -

Purchase of Long term Investment - (72.91) (5.20) - -

Dividend Received 0.06 0.52 2.92 3.85 -

Interest Received 6.07 9.57 4.86 2.19 0.10



- -

Net Cash (used in)/Flow From Investing (1,810.12) (3,036.42) (1,877.74) (1,399.76) (292.48)

169


2010 2009 2008 2007 2006

Activities


Proceeds from issue of share capital - 12.27 25.66 125.99

Proceeds from Securities Premium 99.93 - 93.93 251.60 -

Share application money (97.50) (782.50) 880.00 62.72 -

Debenture Issue Expenses (0.53) (1.00) (23.64) (6.43) -

Proceeds from Long Term Borrowings - - - 490.07

Proceeds from issue of debentures 1,000.00 1,699.99 550.00 -

Proceeds from / (Repayment of) Secured Loans 1,918.33 1,310.30 770.69 360.06 -

Proceeds from / (Repayment of) Unsecured Loans 29.97 - 33.54 10.00 4.77

Proceeds from / (Repayment of) Loans from Group

Companies

13.24 178.59 - (4.77) -

Proceeds from/ (Repayment to) loan from/ to others 236.74 - - -



511.55 1,569.06 131.21 443.46 -

Deposits from Licensees 14.12 74.08 24.25 45.28 61.32

Interest Paid (210.73) (187.52) (86.38) (78.98) -

Net Cash flow from/(used in) Financing

Activities

2,278.38 3,397.74 3,535.87 1,658.60 682.15

Net (Decrease)/ increase in cash and cash

equivalents

(451.24) 965.56 163.62 92.80 22.29


years

1,246.85 281.29 117.66 24.86 2.57

Cash and cash equivalents as at end of years 795.61 1,246.86 281.29 117.66 24.86


Cash on Hand 3.91 31.06 2.29 1.62 1.05





Total 795.61 1,246.85 281.29 117.66 24.86


170

ANNEXURE IV

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO CONSOLIDATED

SUMMARY STATEMENTS, AS RESTATED:

A. SIGNIFICANT ACCOUNTING POLICIES:

a. Basis of preparation of Accounts:

The Accounts have been prepared to comply in all material aspects with applicable Accounting Principles

in India and the relevant provisions of the Companies Act, 1956.

As far as possible, the consolidated financial statements are prepared using uniform accounting policies for

like transactions and other events in similar circumstances and are presented in the same manner as the

Company‟s separate financial statements.

The Financial Statements of the Subsidiaries, Associates and Joint Venture are drawn up to March 31 of

each year.

b. Principles of Consolidation:

The Consolidated Financial Statements relate to Entertainment World Developers Limited (EWDL, the

Company) (Formerly Known as Entertainment World Developers Private Limited) and its subsidiaries (the

Group). The Consolidated Financial Statements have been prepared in accordance with Accounting

Standard 21 (AS 21) “Consolidated Financial Statements”, Accounting Standard 23 (AS 23) “Accounting

for Investment in Associates in Consolidated Financial Statements” and Accounting Standard 27 (AS 27)

“Financial Reporting of Interests in Joint Ventures” notified under the Companies (Accounting Standards)

Rules, 2006. The Consolidated Financial Statements have been prepared on the following basis:

i) Investments in Subsidiaries :

a. The Financial Statements of the Company and its subsidiary companies have been

combined on a line by line basis by adding together the book values of like items of

assets, liabilities, income and expenses. Intra group balances, intra group transactions and

unrealized profits or losses have been fully eliminated.

b. The difference between the costs of investment in the subsidiaries over the Company‟s

share of equity of the subsidiary is recognized in the financial statements as Goodwill or

Capital Reserve, as the case may be.

c. The difference between the proceeds from disposal of investment in a subsidiary and the

carrying amount of its assets less liabilities as of date of disposal is recognized in the

Profit and Loss Account as profit or loss on disposal of investment in subsidiary/s.

d. Minority interest in the net assets of the consolidated subsidiaries consists of the amount

of equity attributable to the minority shareholders at the dates on which investments are

made in the subsidiary Company/s and further movements in their share in the equity,

subsequent to the dates of investments. Minority interest also includes share application

money received from minority shareholders. The losses in subsidiary/s attributable to the

minority shareholder are recognized to the extent of their interest in the equity of the

subsidiaries.

ii) Investment in Associates:

a. Investments in Associates where the Company has significant influence and which is

neither a subsidiary nor a joint Venture are accounted for using the equity method in

171

accordance with AS 23.

b. The Company accounts for its share in the change in the net assets of the associates, post

acquisition, after eliminating unrealized profits and losses resulting from transactions

between the Company and its associates to the extent of its share, through its profit and

loss account to the extent such change is attributable to the associates‟ profit and loss

account and through its reserves for the balance, based on available information.

iii) Investment in Joint venture:

The Group‟s interest in a Joint Venture, which is in the nature of a Jointly Controlled Entity, is

accounted for using the Proportionate Consolidation Method.

c. Use of Estimates:

The preparation of financial statements, in conformity with the generally accepted accounting principles,

requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on

the date of financial statements and the reported amounts of revenues and expenses during the reported

year. Differences between the actual results and estimates are recognised in the year in which the results are

known/ materialized.

d. Revenue Recognition:

i) Rental income, Common Area Maintenance Charges, Project Management Fees and sales etc. are

recognized when no significant uncertainty as to collectability or realisability exists.

ii) Revenue from Construction contracts is recognized by reference to the Percentage of Completion

of the Contract Activity. The stage of completion is determined in proportion of the contract cost

incurred for the work performed upto the reporting date to the estimated total contract cost. Future

expected loss, if any, is recognized as an expense.

iii) Interest income is recognized on time proportion basis.

iv) Dividend income is recognized when right to receive the same is established.

e. Fixed Assets:

i) Fixed Assets are stated at cost net of recoverable CENVAT and rebates etc.

ii) Costs include finance costs till the completion of constructions and directly attributable costs.

iii) Expenses incidental and related to certain projects prior to completion of construction are included

in Capital Work-In-Progress (CWIP). The same will be allocated on completion of project.

f. Inventories:

Items of inventories are valued at lower of cost and net realizable value. Cost of inventories comprises of

cost of land, work in progress and other costs incurred in bringing the inventory to its present location and

condition.

g. Depreciation:

Depreciation is provided on Straight-Line basis at the rate and in manner specified in Schedule XIV of the

Companies Act, 1956 except in case of certain categories of Plant and machinery of the Company and

Office Equipments, which are being depreciated based on the management‟s estimate of useful life of such

assets as follows:

172

Type of Assets Estimated Useful Life (In

Years)

Electrical Installations/ Generators/ Transformers 15

Central Cooling Equipments 15

Office Equipments 7

Depreciation on Assets acquired during the year is provided on pro-rata basis with reference to the month

of addition.

Leasehold land is amortized over the period of lease.

h. Leases:

Assets given on lease are accounted in accordance with Accounting Standard 19 on “Leases”.

Operating Lease:

Assets given on Operating Leases are included in Fixed Assets. Lease income is recognized in the Profit

and Loss Account.

i. Borrowing costs:

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as

part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to

get ready for its intended use or sale. All other borrowing costs are charged to revenue.

j. Investments:

Long-term investments are carried at cost. Provision for diminution is made to recognise a decline other

than temporary, in the value of the investments. Current investments are valued at the lower of cost and fair

value.

k. Foreign Currency Transactions:

Transactions in Foreign Currency are recorded at the exchange rates prevailing on the date of transaction.

Monetary items are translated at the year-end rates. The exchange difference between the rate prevailing on

the date of transaction and on the date of settlement as also on translation of monetary items at the end of

the year is recognised as income or expense, as the case may be.

l. Impairment of Assets:

At the end of each year, the Group determines whether a provision should be made for impairment loss on

fixed assets by considering the indications that an impairment loss may have occurred in accordance with

Accounting Standard 28 (AS 28) „„Impairment of Assets‟‟. Where the recoverable amount of any Fixed

Asset is lower than its carrying amount, a provision for impairment loss on Fixed Asset is made for the

difference.

m. Employee Benefits:

(a) Post Employment Benefits and Other Long Term Benefits:

i) Contributions under Defined Contribution Plans in the form of Provident Fund and

Employees‟ State Insurance Corporation (ESIC) are recognized in the Profit and Loss

Account in the year in which the employee has rendered the service.

173

ii) Defined Benefit and Other Long term Benefit Plans :

The Group‟s Liability towards Defined Benefit Plan in the form of Gratuity is funded

through scheme administered by the Life Insurance Corporation of India (LIC) and

administered through respective Trusts set-up by the Group. The liability is determined

on the basis of actuarial valuation being carried out at each Balance Sheet date using the

Projected Unit Credit Method. The retirement benefit obligation recognized in the

Balance Sheet represents the total of present value of the defined benefit obligation as

reduced by unrecognized past service cost and the fair value of plan assets as at the

balance sheet date. Any assets resulting from this calculation is restricted to the present

value of available refunds from the plan or reductions in future contributions to the plan.

Actuarial gains and losses are recognized immediately in the Profit and Loss Account in

the period of occurrence of such gains and losses. Past service cost is recognized as an

expense on a straight-line basis over the average period until the benefits become vested

to the extent that the benefits are already vested immediately following the introduction

of, or changes to, a defined benefit plan, past service cost is recognized immediately.

(b) Short Term Employee Benefits:

Short-term employee benefits are recognized as expenses at the undiscounted amount in the Profit

and Loss Account of the year in which the related services are rendered.

n. Income Taxes:

Tax expense comprises of current tax, deferred tax and fringe benefits tax. Current tax is measured at

amount expected to be paid to / recovered from tax authorities using the applicable tax rates. Deferred

income tax reflect the current period timing differences between taxable income and accounting income for

the period and reversal of timing differences of earlier years/ period. Deferred tax assets are recognised

only to the extent that there is reasonable certainty that sufficient future income will be available except

that deferred tax assets, in case there are unabsorbed depreciation and losses, are recognised if there is

virtual certainty that sufficient future taxable income will be available to realise the same. Fringe benefits

tax is recognized in accordance with the relevant provisions of the Income-tax Act, 1961 and the Guidance

Note on Fringe benefits tax issued by the Institute of Chartered Accountants of India (ICAI) (Refer Note B

6 below).

o. Contingent Liabilities:

Contingent Liabilities, if any, are disclosed in the Notes on Accounts. Provision is made in the Accounts if

it becomes probable that any outflow of resources embodying economic benefits will be required to settle

the obligation.

B. NOTES TO RESTATED CONSOLIDATED SUMMARY STATEMENTS:

1. The consolidated Financial Statements present the consolidated accounts of the Group, which consists of

the accounts of the Company and the following subsidiaries.

(a) Subsidiaries:

Name of the

Subsidiaries

Country

of

Incorporation

Proportion of ownership interest

As at

March

31, 2010

As at

March

31, 2009

As at

March

31, 2008

As at

March

31, 2007

As at

March

31, 2006

Ujjain Treasure

Bazaar Private

Limited

India 99.98% 99.98% 99.98% 99.98% -

174

Name of the

Subsidiaries

Country

of

Incorporation


As at

March

31, 2010

As at

March

31, 2009

As at

March

31, 2008

As at

March

31, 2007

As at

March

31, 2006

Nanded Treasure

Bazaar Private

Limited

India 75.20% 75.20% 75% 100% -

Amaravati Treasure

Bazaar Private

Limited

India 100% 100% - - -

Treasure Showcase

Private Limited

India 100% 100% 100% - -

Gwalior

Entertainment World

Developers Private

Limited

India - 100% 100% - -

Bhubaneshwar

Entertainment World

Developers Private

Limited

India - 100% 100% - -

EWDPL Residential

Holdings Private

Limited

India 100% 100% 100% - -

EWDPL West Realty

Private Limited

India - 100% 100% - -

EWDPL North Realty

Private Limited

India - 100% 100% - -

EWDPL South Realty

Private Limited

India - 100% 100% - -

Nagpur Treasure

Market City Private

Limited

India - 100% 100% - -

Trivandrum Treasure

Market City Private

Limited

India - 100% 100% - -

Sangli Entertainment

World Developers

Private Limited

India - 100% - - -

EWDPL Bhilai

Hospitality Private

Limited

India - 100% - - -

EWDPL Chandigarh

Hospitality Private

Limited

India - 100% 100% - -

Aloha Hospitals

Private Limited

India - 100% 100% - -

EWDPL Five Star

Hospitality Private

Limited

India 100% 100% 66% - -

EWDPL Jabalpur

Hospitality Private

Limited

India - 100% 75% - -

Skyline Treasure

Structural Engineers

Private Limited

India - 100% 100% - -

175

Name of the

Subsidiaries

Country

of

Incorporation


As at

March

31, 2010

As at

March

31, 2009

As at

March

31, 2008

As at

March

31, 2007

As at

March

31, 2006

Marvell Mall

Development

Company Private

Limited

India 51% 51% 51% 51% -

Treasure World

Developers Private

Limited

India 99.99% 99.99% 99.99% 100% -

Indore Treasure Town

Private Limited

India 60% 60% 60% 60% -

Entertainment World

Developers Bijalpur

Private Limited

India 60% 60% 60% 60% -

Pune Entertainment

World Developers

Private Limited

India 60% 60% 60% - -

Nasik Entertainment

World Developers

Private Limited

India 60% 60% 60% - -

Raipur Treasure

Island Private Limited

India 68.35% 69% 100% 100% -

Chandigarh Treasure


India 52.53% 100% 100% 100% -

Chandigarh

Entertainment World

Private Limited

India 100% 100% 100% 100% -

Jabalpur Treasure


India 52.73% 53% 75% 75% -

Udaipur Treasure

Market City Private

Limited

India 100% 100% 100% 100% -

Banglore

Entertainment World

Developers Private

Limited

India - 100% - - -

Treasure World

Constructions Private

Limited

India 100% 100% 100% - -

Indore Treasure

Market City Private

Limited

India 57.09% 56% 66% 66% -

Cassandra Realty

Private Limited

India 100% 90% 90% 90% -

Dazzling Properties

Private Limited

India 100% 100% 100% - -

Annapoorna

Entertainment World

Developers Private

Limited

India 100% - - - -

Ludhiana

Entertainment World

Private Limited

India - 100% 100% - -

176

Name of the

Subsidiaries

Country

of

Incorporation


As at

March

31, 2010

As at

March

31, 2009

As at

March

31, 2008

As at

March

31, 2007

As at

March

31, 2006

Kolhapur

Entertainment World

Developers Private

Limited

India - 100% - - -

Treasure MEP

Services Private

Limited

India 100% 100% 100% - -

Arc Retail Private

Limited

India - 100% - - -

Treasure Hospitality

Private Limited

India 100% 100% 100% - -

Aashling

Entertainment Private

Limited

India - 100% - - -

Intesys Technologies

Private Limited

India 51% 51% 51% - -

Treasure Food and

Beverages Private

Limited

India 100% 100% 100% - -

Jodhpur

Entertainment World

Developers Private

Limited

India 100% 100% 100% - -

Landmark Treasure

Town

India 51% 51% - - -

Entertainment World

Developers Amritsar

Private Limited

India 100% 100% 100% - -

Wanderland Real

Estates Private

Limited

India 51% 51% - - -

The Baroda

Commercial

Corporation Limited

India 51% 51% 51% 51% -

Notes:

i. The names of the subsidiaries are as per their latest certificates of incorporation.

ii. The Company did not have any subsidiaries, during the year ended March 31, 2006. However, for the

purposes of these Consolidated Financials Information‟s, the figures of the Company as at and for the year

ended March 31, 2006 are disclosed in the respective column.

(b) The following are the associates of the Group:

Name of the

Associates

Country

of

Incorporation


As at

March

31, 2010

As at

March

31, 2009

As at

March

31, 2008

As at

March

31, 2007

As at

March

31, 2006

Surya Treasure Island

Private Limited

India 17.51% 17.78% 33.33% - -

Ramayana Realtors India 33.33% 33.33% 33.33% 33.33% -

177

Name of the

Associates

Country

of

Incorporation


As at

March

31, 2010

As at

March

31, 2009

As at

March

31, 2008

As at

March

31, 2007

As at

March

31, 2006

Private Limited

Picasso Developers

Private Limited

India 33.33% 33.33% - - -

Annapoorna

Entertainment World

Developers Private

Limited

India - 50% 50% - -

Market City

Management Private

Limited

India 40% 40% - - -

Shri Venktesh Real

Estate Private

Limited

India - - 50% - -

* - Surya Treasure Island Private Limited has been considered as an associate as the Group

exercises significant influence over its management.

(c) The following is a Joint Venture of the Company:

Name of the Joint

venture

Country

Of

Incorporation


As at

March

31, 2010

As at

March

31, 2009

As at

March

31, 2008

As at

March

31, 2007

As at

March

31, 2006

Naman Mall

Management

Company Private

Limited

India 50% 50% 50% - -

2. Adjustments/reclassifications done in the Consolidated Summary Statements:

The following adjustments/ reclassifications have been made in the Consolidated Summary Statement of

Assets and Liabilities, Consolidated Summary Statement of Profit and Losses and Consolidated Summary

Statement of Cash Flows:

Adjustments:

Adjustments have been made in the Consolidated Summary Statement of Assets and Liabilities,

Consolidated Summary Statement of Profit and Loss and Consolidated Summary Statement of Cash Flows

on account of the following:

(Rs. in Million)

For the years ended March 31,

2006 2007 2008 2009

Net Profit (Loss) after tax and Minority Interest as per

Consolidated Audited Financial Statements (A)

8.39 (17.78) (32.50) (164.54)

Adjustments on Account of Restatement

Preliminary expenses written off and Deferred Revenue

Expenditure

(14.80) 14.80 - -

Prepayment Charges (9.63) 9.63 - -

Depreciation 3.09 12.35 12.59 14.32

Adjustment on account of Amalgamation - - - 21.36

Total of Adjustments (B) (21.34) 36.78 12.59 35.68

178


2006 2007 2008 2009

Net Profit/ (Loss) after tax, as restated (A+ B) (12.95) 19.00 (19.91) (128.86)

Notes:

Adjustment on Account of Amalgamation:

Vide Order of the Hon‟ble High Court of Mumbai dated May 7, 2010 Treasure World Constructions

Private Limited a wholly owned subsidiary of Treasure World Developers Private Limited (TWDPL), an

existing subsidiary of the Company, was amalgamated with TWDPL with effect from April 1, 2008, the

appointed date (Refer Note 5 below). Consequent to the aforesaid amalgamation, the provision for taxation

(current and deferred tax) for the year ended March 31, 2009 stands reduced by Rs. 21.36 million. The

effect of such reduction has been adjusted in the said year ended March 31, 2009.

Preliminary expenses and deferred revenue expenditure:

Preliminary expenses and deferred revenue expenditure written off in the Audited Financial Statements of

the Company for the year ended March 31, 2007 have been adjusted in the year ended March 31, 2006 to

which the same relate.

Prepayment charges:

Prepayment charges pertaining to loan repaid by the Company were originally accounted in the year ended

March 31, 2006. The same were, however, not written off in the Profit and Loss Account in the said year

but were carried forward in the Balance sheet as the Company expected a waiver for the same from the

lender. Subsequently, the Company could not get a waiver from the lender on the said charges, which were

then written off in the year ended March 31, 2007. However, for the purposes of the Consolidated

Summary Statement of Profit and Loss, the Prepayment charges are considered in the year ended March 31,

2006.

Depreciation:

The Company has, during the year ended March 31, 2010, revised the estimated useful life of some of its

fixed assets, resulting into the depreciation for the said year being lower by Rs. 42.35 million and the profit

for the said year being higher by the like amount (Refer note 21 below). However, for the purposes of the

Consolidated Summary Statement of Profit and Loss, the effect of the aforesaid has been considered in the

respective years from the year in which the said assets were capitalised in the books of account.

Reclassifications:

Reclassifications have been made in the Consolidated Summary Statement of Assets and Liabilities and

Consolidated Summary Statement of Profit and Losses and Consolidated Summary Statement of Cash

Flows on account of the following:

a. Overdrawn bank balances aggregating to Rs. 66.56 Million, disclosed as part of Secured Loan in

the Audited Financial Statements of the Company as at March 31, 2006 have been reclassified as

part of Current Liabilities in the Consolidated Summary Statement of Assets and Liabilities in the

respective years..

b. Refundable Security deposits aggregating to Rs. 150.00 Million as at March 31, 2005 and Rs.

300.00 Million as at March 31, 2006, which were disclosed as part of Fixed Assets in the Audited

Financial Statements of the Company for the respective years have been reclassified as part of

Loans and Advances in the Consolidated Summary Statement of Assets and Liabilities in the

respective years.

179

c. Share Application Money aggregating to Rs. 61.27 Million, which were disclosed as part of

Investments in the Audited Financial Statements of the Company as at March 31, 2006, have been

reclassified as part of Loans and Advances in the Consolidated Summary Statement of Assets and

Liabilities in the respective year.

d. Certain Freehold land and Capital Work-in-Progress which were reclassified as part of inventories

in the Audited Financial Statements of some of the subsidiaries for the year ended March 31, 2008

have been reclassified accordingly in the Consolidated Summary Statement of Assets and

Liabilities for the year ended March 31, 2007 – Freehold Land reclassified Rs. 275.44 Million.;

Capital Work-in-Progress reclassified Rs. 2.54 Million.

The effects of the following have not been given in the Consolidated Summary Statement of Assets

and Liabilities, Consolidated Summary Statement of Profit and Loss and Consolidated Summary

Statement of Cash Flows on the grounds that the figures involved are not material:

a. Excess provision of Income-tax of Rs. 0.12 million of the Company relating to the year ended

March 31, 2007, computed on the completion of the Assessment by the Income-tax authorities has

not been adjusted in the respective year.

b. Sundry Balances written back aggregating to Rs. 3.13 million, Rs. 0.53 million, Rs. 0.29 million

and Rs. 0.05 million in the Audited Financial Statements for the years ended March 31, 2010,

March 31, 2009, March 31, 2008 and March 31, 2007 respectively have not been adjusted in the

respective years to which they pertain.

c. Sundry Balances written off aggregating to Rs. 1.29 million, Rs. 0.26 million, Rs. 0.82 million and

Rs. 0.03 million in the Audited Financial Statements of the Company for the years ended March

31, 2010, March 31, 2009, March 31, 2008 and March 31, 2007 respectively have not been

adjusted in the respective years to which they pertain.

d. Capital Work in Progress written off aggregating to Rs. 1.74 million and Rs. 1.91 million in the

Audited Financial Statements of some of the subsidiaries for the year ended March 31, 2009 and

March 31, 2008 respectively have not been adjusted in the respective years to which they pertain.

e. Preliminary Expenses written off aggregating to Rs. 0.82 million in the Audited Financial

Statements of the Company for the year ended March 31, 2006 has not been adjusted in the year to

which it pertains.

f. Tax impact of adjustments has not been considered as the Company was covered by the provisions

relating to Minimum Alternate Tax under the Income-tax Act, 1961 and the tax impact is also not

material.

g. The Company has adopted the Revised Accounting Standard (AS) 15 on „Employee Benefits‟

with effect from the year ended March 31, 2007. The effect of the Revised AS 15 has not been

given in the years prior to the said year-end on the grounds of the same not being material.

3. Contingent Liabilities:

The following are the details of the Contingent Liabilities:

(Rs. in Million)

Particulars As at March 31,

2010 2009 2008 2007 2006

a) Bank Guarantees Outstanding 103.16 87.35 6.63 7.13 6.60

b) Corporate Guarantees given to Banks / Financial

Institutions

9757.68 4179.88 2915.20 200.00 -

c) Demands of Income Tax Authorities disputed in

180


2010 2009 2008 2007 2006

appeal Amounts deposited by the Company against

above demand

63.64

14.88

13.77

14.88

13.77

5.11

1.91

1.00

-

-

d) Demands of Sales Tax Authorities disputed in

appeal

2.90 2.90 - - -

e) Claim by Madhya Pradesh Housing Board in

respect of forfeiture of shares

115.00 115.00 115.00 115.00 10.67

f) Export obligation undertaken under "Export

Promotion of Capital Goods Scheme".

525.07 387.65 152.32 77.46 50.22

g) Service Tax not collected and paid on rental income 54.04 33.40 14.59 - -

h) Claims against Subsidiary Company not

acknowledged as debt

- 0.03 0.03 0.03 0.03

4. The estimated amount of contracts remaining to be executed on Capital Account, (net of advances), and not

provided for, at the year-end are:

(Rs. in Million)

Year ended Amount

March 31, 2010 728.11

March 31, 2009 555.45

March 31, 2008 2631.17

March 31, 2007 802.36

March 31, 2006 100.00

5. Changes in the Group Structure:

During the year ended March 31, 2010 the following changes in Group Structure have taken place and the

same have been appropriately dealt with in the Consolidated Financial Statements.

In accordance with a scheme of amalgamation sanctioned by the Hon‟ble High Court of Mumbai vide its

order dated May 7, 2010, Treasure World Constructions Private Limited (TWCPL), a wholly owned

subsidiary of Treasure World Developers Private Limited (TWDPL) has merged with effect from April 1,

2008, the appointed date, with TWDPL, an existing subsidiary of the Company.

6. The tax effect of significant timing differences during the year that have resulted in Deferred Tax Assets

and Liabilities are given below.

(Rs. in Million)

Particulars As at

March 31,

2010

As at

March 31,

2009

As at

March 31,

2008

As at

March 31,

2007

As at

March 31,

2006

Deferred Tax Liabilities :

Depreciation 33.34 10.58 8.38 6.03 3.96

Other timing differences: - 0.27 - -

Total Deferred Tax Liabilities 33.34 10.58 8.65 6.03 3.96

Deferred Tax Assets:

Other timing differences: 0.77 1.62 2.14 0.93 0.09

Carried forward unabsorbed

depreciation/business loss as per

Income-tax Act

75.33 76.79 22.61 11.49 4.82

Total deferred tax assets 76.10 78.41 24.75 12.42 4.91

181

Net Deferred Tax Assets # 47.26 69.60 16.10 6.39 0.95

Net Deferred Tax Liabilities 4.50 1.77 - - -

# Net Deferred Tax Assets have not been accounted in view of the requirements of certainty/virtual

certainty as stated in the Accounting Standard 22 on “Accounting for Taxes on Income”.

7. The Group is entitled to tax credit in respect of Minimum Alternate Tax (MAT credit) under the provisions

of the Income-tax Act, 1961. However, considering the degree of probability of availment of the MAT

Credit in future years, which is based on convincing evidence that the Group will pay normal tax in future

as envisaged by the Guidance Note on “Accounting for Credit available in respect of Minimum Alternate

Tax (MAT) under the Income-tax Act, 1961” issued by the ICAI, the MAT credit has not been accounted

by the Group. The accounting for the same will be reviewed at each Balance Sheet date.

(Rs. in Million)

Year Mat Credit (Cumulative amounts)

2009-10 11.07

2008-09 4.77

2007-08 4.34

2006-07 2.77

2005-06 0.80

8. Leases

As a Lessor:

The Group has given Shopping Malls on operating lease on leave and license basis.

Income recognized in the Profit and Loss Account for five years are as follows

(Rs. in Million)

Year ended Income recognized in the

Profit and Loss Account

Share in Joint Venture Total

March 31, 2010 180.00 50.35 230.35

March 31, 2009 158.94 - 158.94

March 31, 2008 149.05 - 149.05

March 31, 2007 141.56 - 141.56

March 31, 2006 22.55 - 22.55

Details of Assets, included in Fixed Assets, given on operating lease are given below:

(Rs. in Million)

Particulars As at March

31, 2010

As at March

31, 2009

As at March

31, 2008

As at March

31, 2007

As at March

31, 2006

Building:

Gross Block 1,075.77 588.44 626.93 415.99 415.99

Depreciation for

the year

13.40 9.59 7.76 6.78 1.70

Accumulated

Depreciation

39.23 25.83 16.24 8.48 1.70

Details of future minimum lease rentals receivable are given below:

(Rs. in Million)


31, 2010

As at March

31, 2009

As at March

31, 2008

As at

March 31,

2007

As at

March 31,

2006

182

Not later than one year 206.59 136.04 131.01 140.73 -

Later than one year and

not later than five years

913.12 445.91 306.13 339.41 -

Later than five years 1,645.75 777.27 680.58 243.58 -

Total 2,765.46 1,359.22 1,117.72 723.72 -

9. Cost of fixed assets of the Company include vehicles which are in the process of being transferred in the

name of the Company as follows:

(Rs. in Million)

Year ended Book Value Written Down Value

March 31, 2010 - -

March 31, 2009 1.05 0.77

March 31, 2008 2.12 1.75

March 31, 2007 2.13 1.96

10. EWDL had issued unsecured optionally fully convertible debentures of the face value of Rs. 750 million.

The Convertible Debentures have tenure of upto five years which is extendable at the option of the

Convertible Debenture holders.

Treasure World Developers Private Limited (TWDPL) has issued the following debentures:

a) 149,999,150, 5% Fully Convertible Debentures of Rs. 10/- each, were issued during the year

ended March 31, 2008 and are convertible after 4 years and 90 days from the date of issue,

b) 100,000,000 Series B 5% Fully Convertible Debentures of Rs. 10/- each, have been issued during

the year ended March 31, 2009 and are convertible after 2 years from the date of issue.

For the debentures stated above at (a) and (b), interest @ 5% per annum compounded semi annually will

accrue on these debentures. These Debentures are to be converted into Equity Shares at a price such that

debenture holders would get a 15 % internal rate of return (IRR) over and above 5% coupon as stated

above. This return (i.e. 15% IRR) shall accrue and become payable only if the debentures are not converted

into Equity Shares in accordance with "The Conversion Rights" as mentioned in the Debenture Agreement.

Further, TWDPL also has an option of paying an additional interest over and above the 5% stated above in

future.

11. Investment in Associates:

(Rs. in Million)

Particulars No. of

Equity

Shares

held

% of

Holding

Cost of

Investment

Goodwill/

(Capital

Reserve)

Share in

Accumulated

(Losses)/

Reserves

Carrying

Amount

Surya Treasure

Island Private

Limited

100,000 17.51% 55.00 (28.23) - 55.00

Ramayana

Realtors Private

Limited

333,333 33.33% 41.77 5.31 - 41.77

Picasso

Developers

Private Limited

166,670 33.33% 20.00 18.33 - 20.00

Market City

Management

Private Limited

40,000 40.0% 0.40 - 0.75 1.15

Total 117.17 (4.57) 0.75 117.92

183

12. Earnings per share (EPS) computed in accordance with Accounting Standard 20 (AS 20) on “Earnings Per

Share”:

(Rs. in Million)

Particulars

Year ended

March 31,

2010

Year ended

March 31,

2009

Year ended

March 31,

2008

Year ended

March 31,

2007

Year ended

March 31,

2006

Profit After Taxation

and exceptional item as

Restated

125.74 (128.86) (19.91) 19.00 (12.95)

Equity Shares

outstanding as at the year

end (in Nos.)

15,739,296 15,739,296 15,739,296 15,000,000 1,124,310

Weighted average

number of Equity

Shares used as

denominator for

calculating Basic

Earnings Per Share

(Including Bonus

Shares see Note iii

below) Add:

Dilutive number of

Shares

62,957,184

62,957,184

61,958,606 58,970,876 57,393,688

Conversion of

debentures

27,877,016

27,877,016

21,359,648

6,777,044 -

Share application money - - - 580,013 1,190,937

Number of Equity

Shares used as

denominator for

calculating Diluted

Earnings Per Share

90,834,200 90,834,200 83,318,254 66,327,933 58,584,625

Nominal Value per

Equity Share (in Rs.)

10.00 10.00 10.00 10.00 10.00

Earnings Per Share

(Basic) (in Rs.)

2.00

(2.05) (0.32) 0.32 (0.23)

Earnings Per Share

(Diluted) (in Rs.)

1.38 (2.05) (0.32) 0.29 (0.23)

Notes:

i) The effect of conversion of Debentures is not considered in calculation of Diluted Earnings per

share for the years ended March 31, 2009, 2008 and 2007 as its effect is of Anti Dilutive nature.

ii) The Company has repaid share application money entirely and hence it has not been considered

while computing dilutive EPS for the years ended March 31, 2009 and 2008

iii) The Company has issued 47,217,888 bonus Equity Shares on June 11, 2010, which have been

considered in the calculation of weighted average number used in the denominator.

13. Employee Benefits:

The disclosures required by Accounting Standard 15 on “Employee Benefits” (AS 15), are given below.

i. Contributions are made to Provident Fund and ESIC, which covers all the regular employees.

184

ii. Defined Benefit Plan

The disclosures as required under AS 15 as per actuarial valuation regarding the Employees

Retirement Benefits Plan for gratuity are as follows:

(Rs. in Million)

Particulars As at

March 31,

2010

As at

March 31,

2009

As at

March 31,

2008

As at

March 31,

2007

Projected benefit obligation, at the

beginning of the year

1.47 0.82 0.30 0.10

Service cost 1.12 0.96 0.47 0.14

Interest cost 0.14 0.06 0.03 0.01

Actuarial (gain)/ loss 0.86 1.03 0.01 0.05

Benefits paid 1.59 1.40 - -

Projected benefit obligation, at

the end of the year

2.00 1.47 0.82 0.30

Defined Benefit obligation liability

as at the Balance Sheet date is

wholly funded

Change in Plan Assets

Fair Value of Assets at the


1.94 0.61 0.21 -

Expected Return on Assets 0.15 0.05 0.02 0.01

Actuarial Gain/ (Loss) 0.21 0.00 0.03 -

Contributions 2.52 1.29 0.34 0.21

Benefits Paid 1.59 - - -

Fair Value of Plan Assets at the

end of the year

3.23 1.95 0.61 0.21

Gratuity Cost for the year

Service Cost 1.12 0.85 0.47 0.14

Interest Cost 0.14 0.06 0.03 0.01

Expected Return on Assets 0.15 0.05 (0.02) (0.01)

Amortization of Actuarial Loss

/(Gain)

0.63 (0.35) (0.02) 0.05

Net Periodic Gratuity Cost 1.74 0.62 0.47 0.19

Net Asset/ (Liability) at the end of

the year

Present Value of Obligation at end

of the year

2.00 1.47 0.82 0.30

Fair Value of Plan Asset at end of

the year

3.23 1.95 0.61 0.21

Funded Status 1.23 0.48 (0.21) (0.09)

Unrecognized actuarial gain/ loss at

end of the year

- - - -

Net Asset/ (Liability) Recognized in

Balance Sheet

1.23 0.48 (0.21) (0.09)

Assumptions:

For year ended

March 31, 2010

For year ended

March 31, 2009

For year ended

March 31, 2008

For year ended

March 31, 2007

Discount rate 8.50% 7.50% 8.50% 8.25%

Inflation Rate 5.00% 5.00% 6.00% 4.00%

185

For year ended

March 31, 2010

For year ended

March 31, 2009

For year ended

March 31, 2008

For year ended

March 31, 2007

Rate of Return

on Plan Assets

8.00% 8.00% 8.00% 7.50%

14. In the month of April 2009, the Income-tax Department had conducted a search on the Company and had

seized some of the documents and accounting records (electronic databases) from the Company. For the

purpose of audit, the Company has restored the accounting records from the back-up databases available

with the Company, which continues to be used thereafter as master records. The documents relevant for the

purpose of preparation of financial statements and audit thereof are available with the Company.

15. On April 5, 2007, the name of the Company had been changed to EWDPL India Private Limited from

Entertainment World Developers Private Limited. The name had been rechanged to Entertainment World

Developers Private Limited during the year ended March 31, 2009.

On February 5, 2010, the Company has been converted from a private limited company to public limited

company. Consequently, its name has been changed from Entertainment World Developers Private Limited

(EWDPL) to Entertainment World Developers Limited (EWDL) and the amended certificate of

incorporation has been received from the Registrar of Companies.

16. During the year ended March 31, 2010, the Company has provided for professional charges aggregating to

Rs 15.89 Million on account of services received for the proposed initial public offering (IPO) of the

Company. The same is being carried forward under Loans and Advances to be adjusted against securities

premium on completion of the said IPO.

17. The Group has not received any intimation from the suppliers regarding their status under Micro, Small and

Medium Enterprises Development Act, 2006 and hence the disclosures required under the Act have been

given accordingly.

18. Deposits from licensees, refundable on termination/ alteration of leave and license agreements are

considered as long-term fund.

19. The Group has credits on account of CENVAT on Purchases and Service Tax as follows which are being

carried forward to be set-off against future Service Tax liability.

(Rs. in Million)


31, 2010

As at March

31, 2009

As at March

31, 2008

As at March

31, 2007

As at March

31, 2006

Credit on account of

CENVAT and Service

Tax

275.38 203.10 122.87 43.88 25.07

20. The principal business of the Group is real estate development which includes construction of residential

buildings, commercial complexes, mall operations etc. and all other activities of the Group revolve around

its main business. Hence, there is only one reportable segment as defined by Accounting Standard 17

“Segment Reporting”.

21. Considering the organization structure of the Group and the nature of construction activities involved in the

Group and in accordance with Accounting Standard 16 (AS 16) on “Borrowing Costs”, interest expenses

have been capitalized as part of Capital work-in-progress and as part of inventory (land) considering the

respective assets as qualifying assets under AS 16 as follows:

(Rs. in Million)

Borrowing cost Capitalised to: For year ended

March 31, 2010

For year ended

March 31, 2009

For year ended

March 31, 2008

186

Borrowing cost Capitalised to: For year ended

March 31, 2010

For year ended

March 31, 2009

For year ended

March 31, 2008

Capital Work-In-Progress 110.91 89.55 38.86

Inventory 29.47 27.58 -

22. Income from Construction Activities includes income from assignment of rights in the plots of Rs 132.81

million during the year ended March 31, 2010.

187

ANNEXURE V

CONSOLIDATED SUMMARY STATEMENT OF SHARE CAPITAL, AS RESTATED

Rs. In Million

Particulars AS AT March 31,

2010 2009 2008 2007 2006

AUTHORISED:

Authorised Capital

Nos. of Equity Share 100,000,000 17,000,000 17,000,000 15,000,000 1,500,000

Face Value (In Rs.) 10 10 10 10 100

Total Value 1,000.00 170.00 170.00 150.00 150.00

ISSUED, SUBSCRIBED AND PAID-UP:

Nos. of Equity Share 15,739,296 15,739,296 15,739,296 13,932,700 1,017,580

Face Value (In Rs.) 10 10 10 10 100

Total Value 157.39 157.39 157.39 139.32 101.76

Nos. of Equity Share - - - 1,067,300 106,730

Face Value (In Rs.) - - - 10.00 100.00

Paid up Value (In Rs.) - - - 1.00 10.00

Total Value - - - 1.07 1.07

Add: 1,067,300 Equity Shares of Rs.10/-

each; Re.1/- paid-up forfeited

1.07 1.07 1.07 - -

Total 158.46 158.46 158.46 140.39 102.83

Note:

a) Of the above 1,067,300 Equity Shares of Rs.10/- each, Re.1/- paid-up, were issued for consideration other

than cash.

b) 1,067,300 equity shares of Rs 10/- each were forfeited during the year ended March 31, 2008.

c) During the year ended March 31, 2007, 1,017,580 Equity Shares of Rs. 100/- each were split into

10,175,800 Equity Shares of Rs 10/- each.

188

ANNEXURE VI

CONSOLIDATED SUMMARY STATEMENT OF RESERVES AND SURPLUS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Securities Premium Account 1,364.43 1,265.03 902.50 767.45 111.88

General Reserve 6.00 6.00 - - -

Profit and Loss Account 6.05

Total 1,370.43 1,271.03 902.50 773.50 111.88

189

ANNEXURE VII

CONSOLIDATED SUMMARY STATEMENT OF SECURED LOANS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Loans and Advances from Banks

Cash Credit (Refer Note below)

Dena Bank 454.80 449.75 - - -

Indian Overseas Bank 148.28 - - - -

Uco Bank 293.87 - - - -

Term loans from Banks and Financial Institutions (Refer

Note below)

State Bank of Indore - - 100.00 -

UCO Bank 1,265.60 798.26 981.58 945.21 704.49

Centurion Bank 1.01 2.87 4.52 - -

HUDCO Term 1,026.01 1,473.31 628.75 - -

Central Bank of India 240.51 135.96 69.29 - -

M.P.F.C Capital Market 27.25 41.01 - - -

SICOM Limited 347.25

LIC Housing Finance Ltd. 460.00

Allahabad Bank 30.36

Punjab National Bank 70.66

Indian Overseas Bank 402.44 - - - -

Vehicle Loans for Banks*

Centurion Bank - - - 0.02 0.31

HDFC Bank 13.21 7.65 5.48 0.16 0.44

ICICI Bank 0.66 1.73 3.48 7.05 0.98

Kotak Mahindra Bank 0.12 0.49 0.91 1.29 -

Overdraft from Allahabad Bank 17.20 - 0.46 - -

4,799.23 2,911.03 1,694.47 1,053.73 706.22

Share in Joint Venture 266.38 236.24 142.50 12.55 -

Total 5,065.61 3,147.27 1,836.97 1,066.28 706.22

* Secured by hypothecation of Vehicles acquired out of the Loans

Note:

a) Cash Credits and Term loans are secured by:

i. Equitable mortgage belonging to group companies

ii. Personal guarantee of Managing Director and corporate guarantees of group companies

iii. Hypothecation of present and future project assets and current assets

iv. First charge by way of equitable mortgage of the land and building thereon

190

Rs. In Million

Lender Sanctioned

Amount

Utilized

Amount

Rate of

Interest

(in %)

Repayment

Date

Prepayment Security offered

Term

Loans

UCO

Bank

Term

Loan-

10678

825.00 825.00 PLR + 1%

(As at

March 31,

2010)

(Reset

after every

three

years)

Equal

Monthly

Instalments

from June

2006 to

December

2014

None Equitable mortgage of

Land belonging to

Group Companies,

Personal guarantee of

Managing Director,

Assignment of future

lease rent receivable

from licensees and First

charge by way of

equitable mortgage of

the Land and Building

thereon

UCO

Bank

Term

Loan-

9106

175.00 175.00 PLR + 1%

(As at

March 31,

2010)

(Reset

after every

three

years)

Equal

Monthly

Instalments

from

November

2006 to

December

2014

prepayment of

loan will attract

penalty 2% of

prepaid amount

Equitable mortgage of

Land belonging to

Group Companies,

Personal guarantee of

Managing Director,

Assignment of future

lease rent receivable


charge by way of

equitable mortgage of

the Land and Building

thereon

Hudco 900.00 655.97 13.25% Nov'2009 prepayment of

loan will attract

prepayment

charges as per

financing pattern


Land, Hypothecation of

movable assets and

Personal guarantee of a

Director of the Holding

Company

Central

bank of

India

250.00 240.51 12.00% June'2010 prepayment of

loan will attract

penalty of 1% of

prepaid amount


immovable property and

Hypothecation of Plant

and Machinery proposed

to be acquired

Hudco 660.00 370.04 13.25% Nov'2010 Equitable mortgage of

immovable property and

Hypothecation of Plant

and Machinery proposed

to be acquired

UCO

Bank

250.00 50.64 13.50% April' 2010 waived if

prepaid through

rent

securitisation

route. On all

other cases 1%

on prepaid

amount.

1st Pari-passu mortgage

& hypo.

Charge over the land

building, plant &

machinery and other

immovable & movable

fixed assets of the

proposed project of the

company (existing &

191

Lender Sanctioned

Amount

Utilized

Amount

Rate of

Interest

(in %)

Repayment

Date


future)

UCO

Bank

750.00 456.80 13.50% June' 2011 to

June 2014

1% except

repayment out of

lease rent

discounting


& hypo. Charge over the

land building, plant &

machinery and other

immovable & movable

fixed assets of the


company (existing &

future)

MPFC

Capital

Market

24.00 24.00 13.75% Start from

April' 2009

Secured by

hypothecation of Plant

and Machinery and

personal guarantee

SICOM 350.00 347.25 15.75% Jan' 2010 to

Dec' 2018

prepayment of

loan will attract

penalty 2% of

prepaid amount

Mortgage of Land and

Building,

Hypothecation of all

movable assets, present

or future. First charge

by way of hypothecation

of lease rent receivable

of the company.

LIC

Housing

Finance

Limited

700.00 285.00 15.00% May 2011 to

August 2014

prepayment of

loan will attract

penalty 2% of

prepaid amount

Mortgage of part of the

land, Assignment of

receivables from the

project "Bijalpur

Residential Township,

Negative lien of flats at

least up to two times of

the outstanding loan

amount.

LIC

Housing

Finance

Limited

500.00 175.00 13.50% April' 2011 to

Jun' 2014

prepayment of

loan will attract

penalty 2% of

prepaid amount




machinery and other

immovable & movable

fixed assets of the


company (existing &

future)

Allahabad

Bank

96.30 30.36 prepayment of

loan will not

attract

penalty

Equitable mortgage on

land, Hypothecation of

Stocks/ Building

material for construction

equipments, assigment

of entire receivables of

the project.

Punjab

National

Bank

350.00 70.66 14.00% from April'

2011

prepayment of

loan will attract

penalty 2% of

prepaid amount




machinery and other

immovable & movable

192

Lender Sanctioned

Amount

Utilized

Amount

Rate of

Interest

(in %)

Repayment

Date


fixed assets of the


company (existing &

future)

Punjab

National

Bank

580.00 580.00 13.00% Nov' 2009 Equitable mortgage of

Immovable property

(except commercial area

office of 6th & 7th

floor), and assignment of

future lease rentals

Indian

Overseas

Bank

400.00 84.94 13.50% from April'

2010

waived if

prepaid through

rent

securitisation

route. On all

other cases 1%

on the amount

prepaid.




machinery and other

immovable & movable

fixed assets of the


company (existing &

future)

State Bank

of Indore

100.00 100.00 10.5 Payable from

May 13, 2007

to September

13, 2007

No prepayment

is allowed

Nil

Vehicle

loans

HDFC,

ICICI and

Kotak

13.99 13.99 It ranges

from 4%

to 11%

Monthly

installments

Secured by

hypothecation of

Vehicles acquired out of

the Loans

193

ANNEXURE VIII

CONSOLIDATED SUMMARY STATEMENT OF UNSECURED LOANS, AS RESTATED

Rs.in Million


2010 2009 2008 2007 2006

Loan from Group Companies

Kalani Industries Private Limited 284.37 164.09 - - 4.77

Kalani Brothers (I) Private Limited 16.07 14.50 - - -

Total 300.44 178.59 - - 4.77

Loans from others

Fab Syntex Private Limited 0.26 0.65 - - -

The Phoenix Mills Limited 250.00 - - - -

Triple A Real Estates Private Limited 7.54 1.66 - - -

Apex Procon Private Limited - 0.61 - - -

Agam Cement Products Private Limited - 0.15 - - -

Dumet Wire India Private Limited 9.10 10.87 - - -

Paceman Traders Private Limited - 0.82 - - -

Shri Ganpati Asbestos Private Limited - 0.10 - - -

Thakkar Industries 13.54 13.54 13.54 - -

G. S. India Services Private Limited - 1.00 - - -

Shree Raj Traders Private Limited 0.50 0.50 - - -

Manisha Kalani 23.73 18.04 - - -

Manish Kalani 29.98 0.55 - - -

Manish Kalani ( HUF ) 13.01 18.80 - - -

Namita Kalani 0.12 4.60 - - -

Aachman Vanijya Private Limited 8.62 8.40 - - -

Bazigar Trading Private Limited 16.09 16.08 - - -

Ellisbridge Estates Private Limited 8.61 8.40 - - -

Anshuman Properties Private Limited 0.84 0.79 - - -

Dumet Wire India Private Limited 9.10 10.81 - - -

Ecstasy Heights Private Limited 0.23 0.19 - - -

Excellence Properties Private Limited 0.20 0.14 - - -

Fab Syntex Private Limited 0.26 0.47 - - -

Four Dimension Properties Private Limited 6.92 - - - -

Gagan Commercial Agencies Private Limited 0.30 2.35 - - -

Gemini Heights Private Limited 0.16 0.11 - - -

High Beam Reality Private Limited 0.07 0.10 - - -

High-Skey Properties Private Limited 0.22 1.84 - - -

Indore Land and Finance Limited 5.54 1.63 - - -

Pusti Trading Private Limited 2.63 1.70 - - -

Ratangiri Vinimay Private Limited 0.67 15.00 - - -

Saka Tradings Private Limited 0.47 0.50 - - -

Sanovi Trading Private Limited 1.60 2.43 - - -

Saurabh Properties Private Limited 0.82 0.45 - - -

Seven Star Properties Private Limited 10.96 0.59 - - -

Triple A Constructions Private Limited 0.05 0.54 - - -

Triple A Real Estates Private Limited 7.54 1.59 - - -

Vibgyor Laminates Private Limited 3.11 0.95 - - -

Vindhya Cement Private Limited 9.01 1.23 - - -

Skyline Advisory Services Private Limited 3.75 2.36 - - -

Kirti Seeds Biotech Limited 15.89 15.67 - - -

194


2010 2009 2008 2007 2006

Manimudra Vincom Private Limited 20.65 20.31 - - -

PKC Credit Private Limited 1.25 - - - -

Right Aid Consultants Private Limited 8.04 8.05 - - -

Crochet Trade and Investment Private Limited 7.15 - - - -

JMD Sound Limited 0.54 - - - -

Neha Cassette Private Limited 0.25 - - - -

P. S. Kalani (HUF) 20.72

Wanderland Constructions Private Limited 0.16 - - - -

Warner Multimedia 0.23 - - - -

Upal Developers Private Limited 3.45 - - - -

Scientific Mes-Technik Private Limited 2.50 - - - -

Shri Vanktesh Softech Private Limited - - 30.00 - -

Khanna Builders and Developers - - - 10.00 -

Total 509.48 181.70 43.54 10.00 -

Bank Overdraft from Axis Bank - 414.71 - - -

Debentures 3,249.99 3,249.99 2,249.99 550.00 -

(Refer Note 1 below)

Group Share in Unsecured Loans of Joint Venture - 4.95 - - -

Total 4,059.91 4,029.95 2,293.53 560.00 4.77

Note:

EWDL had issued unsecured optionally fully convertible debentures of the face value of Rs. 750 million. The

Convertible Debentures have tenure of upto five years which is extendable at the option of the Convertible

Debenture holders.

Treasure World Developers Private Limited (TWDPL) has issued the following debentures:

a) 149,999,150, 5% Fully Convertible Debentures of Rs. 10/- each, were issued during the year ended March

31, 2008 and are convertible after 4 years and 90 days from the date of issue,

b) 100,000,000 Series B 5% Fully Convertible Debentures of Rs. 10/- each, have been issued during the year

ended March 31, 2009 and are convertible after 2 years from the date of issue.

For the debentures stated above at (a) and (b), interest @ 5% per annum compounded semi annually will accrue on

these debentures. These Debentures are to be converted into Equity Shares at a price such that debenture holders

would get a 15 % internal rate of return (IRR) over and above 5% coupon as stated above. This return (i.e. 15%

IRR) shall accrue and become payable only if the debentures are not converted into Equity Shares in accordance

with "The Conversion Rights" as mentioned in the Debenture Agreement. Further, TWDPL also has an option of

paying an additional interest over and above the 5% stated above in future.

195

ANNEXURE IX

CONSOLIDATED SUMMARY STATEMENT OF INVENTORIES, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Land (For development of integrated residential township) 2,355.22 2,240.46 1,255.09 275.44 -

Stores, Spares and Consumables 56.45 50.94 - - -

Construction Material 19.62 16.15 - - -

Work-in-Progress 647.31 160.11 180.30 15.88 -

Total 3,078.60 2,467.66 1,435.39 291.32 -

19

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197

ANNEXURE XI

CONSOLIDATED SUMMARY STATEMENT OF SUNDRY DEBTORS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Sundry Debtors

Debts outstanding for a period exceeding six month:

Secured, Considered good 1.64 1.13 0.59 - -

Unsecured, Considered good 0.24 2.01 - 0.26 -

Unsecured, Considered Doubtful 0.52 0.11 - - -

A 2.40 3.25 0.59 0.26 -

Other Debt:

Secured, Considered good 22.88 20.72 12.47 13.27 -

Unsecured, Considered good 360.07 9.40 25.90 - 14.00


B 383.47 30.53 38.37 13.27 14.00

A+B 385.87 33.78 38.96 13.53 14.00

Less Provision 1.04 0.52 - - -

384.83 33.26 38.96 13.53 14.00

Share in Joint Venture 0.82 - - - -

Total 385.65 33.26 38.96 13.53 14.00

Note: Refer Annexure XXI for debts due from Related Parties.

198

ANNEXURE XII

CONSOLIDATED SUMMARY STATEMENT OF LOANS AND ADVANCES, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Loans and advances

(Unsecured, considered good)

Advances recoverable in cash or in kind or for value to be

received

555.39 427.57 651.99 82.62 97.70

Security Deposits 312.72 313.75 312.72 309.01 307.29

Unbilled Revenue 6.64 5.66 - - -

Mobilisation Advance to Contractors 12.29 20.70 - - -

Advance to Contractors 19.08 13.44 - - -

Advance to Suppliers 34.26 19.91 - - -

Loans to Group Companies 13.36 21.40 - - -

Loans to Other Companies 22.15 27.34 119.30 16.80 -

Share Application money (Pending Allotment) 74.83 74.83 144.42 49.84 61.27

Advance Tax (Net of Provisions) 128.18 102.54 58.75 27.08 1.78

Advance Fringe Benefit Tax (Net of Provisions) 0.09 0.04 0.01 - -

Accrued Interest on Fixed Deposits 22.43 17.82 3.47 2.22 0.14

1,201.42 1,045.00 1,290.66 487.57 468.18


Total 1,221.46 1,048.99 1,301.19 495.73 468.18

Note: Refer Annexure XXI for loans and advances given to Subsidiaries and other Related Parties.

199

ANNEXURE XIII

CONSOLIDATED SUMMARY STATEMENT OF CASH AND BANK BALANCES, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Cash in hand 3.91 31.06 2.29 1.62 1.05

Balances with Scheduled Banks




779.57 1,236.58 272.77 116.47 24.86


Total 795.61 1,246.85 281.29 117.66 24.86


200

ANNEXURE XIV

CONSOLIDATED SUMMARY STATEMENT OF INVESTMENTS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Long Term Investments (At Cost )

In Shares - (unquoted - (Trade))

Associates ( Refer Note B.12 of Annexure IV)

40,000 Equity Shares of Market City Management Private Limited of

Rs.10/- each fully paid-up

1.15 1.31 - - -

500,000 Equity Shares of Shri Venktesh Real Estate Private Limited of


- - 5.00 - -

2,78,889 Equity Shares (previous year Nil) of Addon Retail Private

Limited

3.50 - - - -

100,000 (2008: 10,000) Equity Shares of Surya Treasure Island Private

Limited of Rs.10/- each fully paid-up

55.00 55.00 0.10 - -

333,333 Equity Shares of Ramayana Realtors Private Limited of


41.77 41.77 41.67 41.66 -

166,670 Equity Shares of Picasso Developers Private Limited of


20.00 20.00 - - -

Others

10 Shares of Antop Hill Warehousing Co. Ltd. of face value of Rs.

1000/- each fully paid-up

- 0.01 0.01 0.01 -

Current Investments: Non-Trade

(Unquoted, at lower of cost and fair value)

25,637.01 units of Rs.10.02 each of HDFC Cash Management Fund-

Saving Plan Weekly Dividend

- - - 0.26 -

4,941,688.08 units of Rs. 10.12 each of TATA Dynamic Bond Fund - - - 50.00 -

1,43,301.002 (2007: 1,061,044.20) units of Rs. 10.9801 of LICMF

liquid fund

1.59 1.42 1.42 11.65 -

19,977.30 units of Rs. 1,001.14/- each of Reliance Liquid Fund - - 20.00 - -

6,165.23 units of Rs.10.015/- each of HDFC Cash Management Fund

Saving Plus Plan

- - 0.07 - -

14,982.973 units of Rs. 1,001.1364 each of Reliance Liquid Fund Daily

Dividend Plan

- - 15.00 - -

123.01 119.51 83.27 103.58 -

Share in Joint Venture - - - 1.52 -

Total 123.01 119.51 83.27 105.10 -

Note:

Aggregate book values:

Quoted Investments - - - - -

Unquoted Investments 123.01 119.51 83.27 105.10 -

Total 123.01 119.51 83.27 105.10 -

201

ANNEXURE XV

CONSOLIDATED SUMMARY STATEMENT OF CURRENT LIABILITIES AND PROVISION, AS

RESTATED

Rs. In Million


2010 2009 2008 2007 2006

CURRENT LIABILITIES

Sundry Creditors

Total Outstanding dues of creditors other than Micro Enterprises

and Small Enterprises

1,048.45 1,135.74 174.82 54.33 39.40

Security Deposits 29.93 32.85 53.00 - -

Mobilization advance from customers - - - - -

Advances from customers 94.07 25.52 - - -

Over drawn Bank Balances as per books 85.51 230.19 220.38 81.23 66.56

Interest Accrued but not due on Loans 8.65 20.19 0.30 - -

1,266.61 1,444.49 448.50 135.56 105.96


Total (A) 1,276.58 1,452.99 452.65 137.53 105.96

PROVISIONS

For Leave Encashment and Gratuity 4.29 4.91 2.50 2.93 0.70

For Fringe Benefits Tax (Net of advance tax) 0.20 1.72 0.46 0.09 -

For Income Tax (Net of advance tax) 23.50 7.81 1.39 0.01 -

For Wealth tax 0.08 0.06 0.08 0.03 -

For Outstanding Exp - - - -

28.07 14.50 4.43 3.06 0.70


Total (B) 28.85 14.60 4.52 3.16 0.70

Grand Total (A)+(B) 1,305.43 1,467.59 457.17 140.69 106.66

Note:

The Group has not received any intimation from the suppliers regarding their status under Micro, Small and Medium

Enterprises Development Act, 2006 and hence the disclosures required under the Act have been given accordingly.

202

ANNEXURE XVI

CONSOLIDATED SUMMARY STATEMENT OF INCOME FROM OPERATIONS AND OTHER

INCOME, AS RESTATED

Rs. In Million

Particulars Nature FOR THE YEARS ENDED MARCH 31,

2010 2009 2008 2007 2006

Income From Operations

Rental Income 180.00 158.94 149.05 141.56 22.55

Common Area Maintenance Charges 40.25 39.99 39.56 35.55 3.50

Sale of Food and Beverages 63.80 56.46 - - -

Recovery of Expenses 53.90 47.26 50.27 41.25 -

Project Management Fees 64.85 7.78 24.32 - -

Income from Construction Activities 43.48 78.66 - - -

Sale of Construction Properties 498.68 - - - -

Commission Received - - 2.12 - -

944.96 389.09 265.32 218.36 26.05


Total (A) 1,020.01 389.09 265.32 218.36 26.05

Other Income

Interest

Deposits with Bank Recurring 6.48 9.43 2.59 2.77 -

Others Non-Recurring 4.20 14.50 3.52 1.50 -

Dividend Received on Current Investments Non-Recurring 0.06 0.52 2.92 3.85 -

Profit on Sale of Fixed Assets Non-Recurring - 2.90 - - -

Income from Hire of Plant and Machinery Non-Recurring 1.95 1.92 - - -

Profit on Sale of Current Investments ( Net ) Non-Recurring - - 0.54 0.35 -

Sundry Balances Written Back Non-Recurring 3.13 0.53 0.29 0.05 -

Miscellaneous Income Non-Recurring 5.14 4.79 2.79 4.71 0.10

Foreign Exchange Gain (Net) Non-Recurring - - 4.10 - -

Profit on Sale of Subsidiary Non-Recurring 20.29 - - - -

41.25 34.59 16.75 13.23 0.10


Total (B) 42.33 34.59 16.75 13.23 0.10

Grand Total (A)+(B) 1,062.34 423.68 282.07 231.59 26.15

203

ANNEXURE XVII

CONSOLIDATED SUMMARY STATEMENT OF CONSTRUCTION EXPENSES, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Construction Expenses

Material Consumption


Cost of Land 233.81 1.65 - - -

Other Construction Material 5.92 - - - -

Total 268.93 29.65 - - -

204

ANNEXURE XVIII

CONSOLIDATED SUMMARY STATEMENT OF EMPLOYEE REMUNERATION, AND BENEFITS, AS

RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Salaries, Wages and Bonus 90.40 55.94 39.64 18.19 2.10

Contribution to Provident and Other Fund 3.01 2.53 1.70 0.29 -

Total 93.41 58.47 41.34 18.48 2.10

205

ANNEXURE XIX

CONSOLIDATED SUMMARY STATEMENT OF OPERATING AND OTHER EXPENSES, AS

RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Insurance 1.51 1.12 1.45 1.49 -

Survey Charges - - 0.05 - -

Traveling and Conveyance Expenses 8.53 4.07 2.22 0.22 0.02

General and Administrative Charges 16.80 4.28 1.17 0.002 0.03

Advertisement and Sales Promotion 33.31 8.16 1.93 2.26 -

Donation 0.20 0.16 1.60 - -

Office Expenses 1.67 - - - -

Purchases 25.37 20.91 - - -

Water Expenses 3.84 5.19 1.92 2.02 -

Repairs

-Building 2.23 4.95 2.63 0.37 -

-Plant and Machinery 3.40 1.67 1.92 0.55 -

-Others 5.11 2.09 2.07 0.92 0.03

Power and Fuel 79.25 76.92 77.28 70.02 2.26

Rent, Rates and Taxes 18.73 19.38 4.56 3.64 2.58

Legal and Professional Fees 35.92 8.09 10.26 1.87 0.02

Loss on Sale of Fixed Assets 0.77 0.45 0.40 0.11 -

Bad debts Written off 1.29 0.26 0.82 0.03 -


Miscellaneous Expenses 5.63 5.52 7.11 3.73 0.97

Preliminary Expenses Written off 0.19 5.21 18.44 14.80

Foreign Exchange Loss - 22.79 - - -

Advance Forfeited - - 4.50 - -

Brokerage and Commission 0.05 0.17 0.44 1.58 -

Capital Work In Progress written off - 1.74 1.91 - -

Prepayment Charges - - - 9.63 -

Total 244.32 193.65 142.68 113.26 5.91


Total 276.32 193.65 142.68 113.26 5.91

206

ANNEXURE XX

CONSOLIDATED SUMMARY STATEMENT OF INTEREST AND FINANCE CHARGES, AS

RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Interest on:

On Debentures 137.10 120.11 28.22 - -

On Overdraft Accounts 54.72 38.45 2.27 - -

On Bank Loan 3.16 - - - -

On Term Loans 404.52 500.35 137.21 94.23 -

Loan Processing Charges 7.84

Others (Bank Charges etc.) 1.36 5.74 14.81 1.45 -

608.70 664.65 182.51 95.68 -

Less: Capitalised during the year to Capital Work-in-Progress 400.07 429.65 95.77 16.70 -

Less: Capitalised during the year to Inventories 38.44 27.59 - - -

170.19 207.41 86.74 78.98 -


Total 199.19 207.41 86.74 78.98 -

207

ANNEXURE XXI

CONSOLIDATED SUMMARY STATEMENT OF RELATED PARTY DISCLOSURES, AS RESTATED

Related party disclosures as required by Accounting Standard (AS) 18, "Related Party Disclosures", are

given below:

(i) List of Related Parties:

a. Entities having substantial interest in the Group

The Phoenix Mills Limited

Emmer River Limited

Diemel River Limited

Weser River Limited

Khanna Builders and Developers

Kshitij Venture Capital Fund

Landmark Hi Tech Development Private Limited

Padma Homes Private Limited

Yuvraj Trust

Ochtum River Limited

K2C Residential Limited

Thakkar Industries

Biltech Engineers Private Limited

b. Joint Venture

Naman Mall Management Company Private Limited

c. Associate Enterprises

Ramayana Realtors Private Limited

Surya Treasure Island Private Limited

Market City Management Private Limited

Picasso Developers Private Limited

d. Key Management Personnel and their relatives

Mr. Manish Kalani

Mr. B. Rajesh Nair

Mr. Shishir Baijal

Mr. Shishir Shrivastava

Mr. Parthiv Khilachand

Mr. Nandish Khilachand

Mrs. Padma Kalani

Mrs. Namita Kalani

Mr. P. S. Kalani

Mrs. Manisha Kalani

Mr. Vinayak Kalani

e. Group entities:

Kalani Industries Private Limited

Tambe Financial Services Private Limited

208

Flexituff International Limited

Kalani Brothers (Indore )Private Limited

P Kalani and Associates

Pusti Trading Private Limited

High Beam Reality Private Limited

Excellence Properties Private Limited

Gemini Heights Private Limited

Ratnagiri Vinimay Private Limited

Saka Tradings Private Limited

Vibgyor Laminates Private Limited

209

Transactions undertaken/balances outstanding with the related parties:

Rs. In Million


2010 2009 2008 2007 2006

Allotment of Equity Shares

Ochtum River Limited 4.61 - - - -

Weser River Limited 0.06 1.77 - - -

Emmer River Limited 0.13 4.09 - - -

Diemel River Limited 0.10 3.00 - - -

Thakkar Industries - - 2.50 - -

K2C Residential Limited 0.07 2.00 - 6.50 -

Edelweiss Trustee Services Private Limited - - 0.10 - -

Surya Treasure Island Private Limited - 0.10 - - -

The Phoenix Mills Limited - - 0.10 - -


Kshitij Venture Capital Fund - - - 3.80 -

Vikas Aggarwal (Director) 0.02

Abhik Roy Choudhary 0.02

Manashi Construction Private Limited. -

Landmark Hi Tech Development Private Limited 28.50

Landmark Hi Tech Development Private Limited (208.00)

15% Unsecured Fully Convertible Debentures

The Phoenix Mills Limited - 1,000.00 - - -

Share Application Money Paid - - - - -

Intesys Technologies Private Limited - 1.10 - - -

Naman Mall Management Company Private limited - - 0.10 - -


Share Application Money Refunded

K2C Residential Limited 12.27 117.27 - - -


Thakkar Industries - 3.00 - - -

Emmer River Limited - 227.50 - - -

Weser River Limited - 416.78 - - -

Kshitij Venture Capital Fund 14.40 14.30 - - -

The Phoenix Mills Limited 97.50 0.01 - - -

Naman Mall Management Company Private Limited 0.10

Vikas Aggarwal (Director) 0.45

Abhik Roy Choudhary 0.45

Manashi Construction Private Limited. 0.20

Edelweiss Trustee Services Private Limited - - 50.93 - -

Ramayana Realtors Private Limited - - 74.83 - -

Brij Mohan - - - 0.79 -

Kalani Brothers (Indore) Private Limited - - - - 86.61

Padma Homes Private Limited - - - - 42.22

Investment in Shares (including Securities Premium) - - - - -

Weser River Limited - 415.01 - - -

K2C Residential Limited - 105.00 - - -

Shri Venktesh Real Estate Private Limited - - 5.00 - -

Surya Treasure Island Private Limited - 54.90 0.10 - -

Picasso Developers Private Limited - 20.00 - - -

210


2010 2009 2008 2007 2006

Addon Retail Private Limited 3.50

Annapoorna Entertainment World Developers Private Limited - - 0.10 - -

Security Premium Received

Emmer River Limited 7.37 223.41 - - -

K2C Residential Limited 263.13 281.97 108.42 323.50 -

The Phoenix Mills Limited - 0.01 150.85 - -



Khanna Builders and Developers - - 5.10 22.92 -

Diemel River Limited 14.30

Ochtum River Limited 324.39 - - - -

Weser River Limited 13.68

Kshitij Venture Capital Fund - - - 121.60 -

Issue of Shares

Ruia Real Estate Development Company Private Limited - - 18.07 - -

Sale of Shares

Shri Venktesh Real Estate Private Limited - 5.00 - - -

Aashling Entertainment Private Limited -

Arc Retail Private Limited 0.20

Gwalior Entertainment World Developers Limited 1.50

Purchase of Shares

Padma Kalani 0.01 2.03 - - -

Kalani Industries Private Limited 0.01 2.03 - - -

Namita Kalani - 1.49 - - -

P. S. Kalani - 0.81 - - -

Manisha Kalani 0.05 1.01 - - -

Yuvraj Trust - 0.34 - - -

Vinayak Kalani - 0.34 - - -

Manish Kalani 0.03 - - -

Others - 1.80

Loans taken

Kalani Industries Private Limited 479.29 171.20 152.96 54.48 -

Kalani Brothers (Indore) Private Limited - - 94.80 2.00 -

Padma Homes Private Limited - - 42.22 - -

Kshitij Venture Capital Fund - 9.90 - - -



Anshuman Properties Private Limited 4.01 - - - -

Ecstasy Heights Private. Limited 0.60 - - - -

Excellence Properties Private Limited 1.00

Four Dimension Properties Private Limited 22.24

Gemini Heights Private Limited 1.00

High Beam Reality Private Limited 0.70

High-Skey Properties Private Limited 1.20

Manish Kalani 50.29

Manish Kalani (HUF) 72.00

The Phoenix Mills Limited 450.00

211


2010 2009 2008 2007 2006

Pusti Trading Private Limited 1.34

Saka Tradings Private Limited 3.03

Skyline Advisory Services Private Limited 3.64 - - - -

Triple A Real Estates Private Limited 18.61 - - - -

Vibgyor Laminates Private Limited 7.49 - - - -

Vindhya Cement Private Limited 8.07 - - - -



Loans repaid


Kalani Industries Private Limited 383.22 167.91 - 54.48 -

High Beam Reality Private Limited 0.73 - - - -

Excellence Properties Private Limited 0.94 - - - -

Gemini Heights Private Limited 0.96 - - - -

Ratnagiri Vinimay Private Limited - - - -

Saka Tradings Private Limited 3.21 - - - -


Manish Kalani 24.61 - - - -

Manish Kalani (HUF) 80.10 - - - -

Kalani Brothers (Indore) Private Limited - - 2.00 -

Anshuman Properties Private Limited 4.17

Ecstasy Heights Private Limited 0.58


EWDPL South Realty Private Limited 149.20



Skyline Advisory Services Private Limited 2.92

Triple A Real Estates Private Limited 1.94

Vindhya Cement Private Limited 0.80

Wanderland Constructions Private Limited 0.28


Loans given


EWDPL Bhilai Hospitality Private Limited 0.02


Khanna Builders and Developers - - 10.00 - -

Naman Mall Management Company Private limited 13.58 - 95.00 - -

Sangli Entertainment World Private Limited 0.13

Trivandrum Treasure Market City Private Limited 0.48

Kalani Industries Private Limited - - 15.00 - -


Surya Treasure Island Private Limited - - - - -

Ramayana Realtors Private Limited - - - - -


Ashok Apparels Private Limited - - - 16.80 -

- - - - -

Loan received back - - - - -

Shri Venktesh Real Estate Private Limited - 60.00 - - -

Surya Treasure Island Private Limited - 6.20 40.43 - -

212


2010 2009 2008 2007 2006


Bhubaneshwar Entertainment World Developers Private

Limited

0.32

EWDPL Bhilai Hospitality Private Limited 0.12

EWDPL Chandigarh Hospitality Private Limited 0.14

EWDPL Jabalpur Hospitality private Limited 0.14

EWDPL North Realty Private Limited 0.14


EWDPL Ujjain Hospitality Private Limited 0.14

EWDPL West Realty Private Limited 0.14

Kshitij Venture Capital Fund 21.00

Gwalior Entertainment World Developers Private Limited 0.26

Nagpur Treasure Market City Private Limited 1.17


Sangli Entertainment World Developers Private Limited 0.13

Trivandrum Treasure Market City Private Limited 1.46

Ramayana Realtors Private Limited - - - -


Advances Given

Kalani Industries Private Limited - 96.65 85.38 52.50 -

Kamaskhya Tracom Private Limited - 0.01 - - -

Tambe Financial Services Private Limited - 0.01 - - -

Crest Hospitality Private Limited - 0.00 - - -

Surya Treasure Island Private Limited 0.55 6.20 - - -

Ramayana Realtors Private Limited 13.36 9.10 - - -


Aashling Entertainment Private Limited 0.03

Banglore Entertainment World Developers Private Limited 0.14


Kolhapur Entertainment World Developers Private Limited 0.02

Ludhiana Entertainment World Private Limited 0.92

Karpre Trading Private Limited 0.20

Advances Received back


Aashling Entertainment Private Limited 0.09


Banglore Entertainment World Developers Private Limited 0.14

Kolhapur Entertainment World Developers Private Limited 1.24

Ramayana Realtors Private Limited 9.10

Surya Treasure Island Private Limited 0.55

EWDPL Chandigarh Hospitality Private Limited 0.02


Karpre Trading Private Limited 0.20

Advance paid

Karpre Trading Private Limited 0.20 - - - -

Purchase of Land



213


2010 2009 2008 2007 2006


Sale


Capital Contribution

Landmark Hi Tech Development Private Limited - - - - -

Rent Paid (Lease Rent)

Padma Homes Private Limited 0.03 0.34 0.03 0.04 -

Kalani Brothers (Indore) Private Limited 0.08 0.08 - 0.10 -

Kalani Industries Private Limited - - - 0.01 -


Interest paid

Kalani Industries Private Limited 20.59 8.60 5.55 - -


Anshuman Properties Private. Limited. 0.24


Excellence Properties Private Limited 0.01


Gemini Heights Private Limited 0.00

High Beam Reality Private Limited 0.00


Kalani Brothers (I) Private Limited 17.04

Manish Kalani 4.17

Manish Kalani (HUF) 2.56


Saka Tradings Private Limited 0.16





Vindhya Cement Private Limited 0.56 - - - -



Interest Received

High Beam Reality Private Limited - - - - -

Excellence Properties Private Limited - - - - -

Gemini Heights Private Limited - - - - -


The Phoenix Mills Limited - (17.35) - - -

Reimbursement of Expenses from Subsidiary/Group

Companies

- - - - -

Surya Treasure Island Private Limited 2.04 - 4.95 - -

Ramayana Realtors Private Limited 0.05 - 0.01 - -


P. Kalani and Associates 0.09 - - - -

Naman Mall Management Company Private. Limited - - - -

Kalani Industries Private Limited 6.90 - 0.05 - 14.72

214


2010 2009 2008 2007 2006

Flexituff International Limited - - 0.00 - -


Kalani Holdings Private Limited - - 0.04 - -

Skyline Advisory Services Private Limited - - - - 0.10

MRK Foods - - - - 1.04


Interest on Sub Debts

Kalani Industries Private Limited 5.89

Ramayana Realtors Private Limited 0.00

Project Technical Consultancy Charges


Hire Charges Received


Naman Mall Management Company Private Limited 0.06 0.12 - - -

Remuneration to Directors

Remuneration paid or provided to the Directors 18.05 5.86 - - -

Commitment Deposits

Landmark Hi Tech Development Private Limited - 24.50 53.00 - -

Designing Charges


Rent Received

Kalani Industries Private Limited 0.11 - 0.10 - -

Others - 2.13 - - -

Flexituff International Limited 0.06 - 0.06 - -

Surya Treasure Island Private Limited - - 0.01 - -

Kalani Holdings Private Limited - - 0.01 0.05 -

Project Management Fees Received

Surya Treasure Island Private Limited 7.60 - 23.60 - -

Naman Mall Management Company Private limited 0.25 - 1.45 - -

Others - 0.10 - - -

Professional Fees

Market City Management Private Limited - 2.45 - - -

License fees and Others charges Recd.

Kalani Industries Private Limited - - 10.03 10.59 -

Skyline Advisory Services Private Limited - 0.19 1.18 - 3.91

MRK Foods - - - - 1.04

Purchase of material

Flexituff International Limited - - - - 2.91

MRK Pipes Limited - - - - 0.55

215


2010 2009 2008 2007 2006

Security deposit received

MRK Foods - - - - 0.16

Security deposit paid

Kalani Brothers (Indore) Private Limited - - - - 105.96


Security Provided by the Company by way of Mortgage of

Land

Corporate Guarantee given by Company


Others - 604.68

Construction Income

Naman Mall Management Company Private Limited 17.96 - - - -

Consultancy Income


Closing Balance : Receivable / ( Payable)

-As Creditors

Naman Mall Management Company Private Limited 1.32 (1.27) - - -

Naman Mall Management Company Private Limited (S.D.) 1.10 - - -

Kshitij Investment Advisory Company Limited (0.04) - - -




Kalani Industries Private Limited (0.73)

The Phoenix Mills Limited (295.56) (17.35) - - -

-Purchase of Shares - - - - -

Padma Kalani - (1.89) - - -

Kalani Industries Private Limited - (1.89) - - -

Namita Kalani - (1.39) - - -

P. S. Kalani - (0.76) - - -

Manisha Kalani - (0.95) - - -

Yuvraj Trust - (0.32) - - -

Vinayak Kalani - (0.32) - - -

-As Unsecured Loans (Given)

Kshitij Venture Capital Fund (9.90) - - -

Kalani Industries Private Limited 103.14 143.72 68.97 - -

Thakkar Industries (13.54) (13.54) (13.54) - -


Pusti Trading Private Limited 2.63 1.70 - - -

High Beam Reality Private Limited 0.07 0.10 - - -

Excellence Properties Private Limited 0.20 0.14 - - -

Gemini Heights Private Limited 0.16 0.11 - - -

Ratnagiri Vinimay Private Limited 0.67 15.00 - - -

Saka Tradings Private Limited 0.47 0.50 - - -

Vibgyor Laminates Private Limited 3.11 0.95 - - -

Vindhya Cement Private Limited 9.01

Naman Mall Management Company Private limited 16.07 14.50 95.00 - -

Kalani Brothers (I) Private Limited 14.50 - - -

216


2010 2009 2008 2007 2006

Manish Kalani 29.98 0.55 - - -

Manish Kalani(HUF) 13.01 18.81 - - -

Market City Management Private Limited - - - -

Anshuman Properties Private Limited 0.84

BrijMohan 30.56




Kalani Brothers (I) Private Limited 16.07




Upal Developers Private Limited 3.45

Wanderland Construction Private Limited 0.16

Landmark Hi Tech Development Private Limited - - (53.00) - -


Kshitij Venture Capital Fund - 9.90

-As Debtors

Naman Mall Management Company Private Limited - 0.11 - - -

Kalani Industries Private Limited - 0.03 - - -

Naman Mall Management Company Private Limited (Cr) - - - - -

Surya Treasure Island Private Limited - - - - -

-As Advances

Kalani Industries Private Limited - 56.06 - 0.02 -


Naman Mall Management Company Private Limited - - 0.82 - -

Khanna Builders and Developers - - - (10.00) -


Ashok Apparels Private Limited - - 16.80 16.80 -

Kalani Industries Private Limited - - (0.05) - -


Ramayana Realtors Private Limited - - 0.01 - -

-As Capital Account

Landmark Hi Tech Development Private Limited - (179.50) - - -

Share Application Money (Pending Allotment)

Kshitij Venture Capital Fund - (14.40) - - -

Naman Mall Management Company Private Limited - - - - -

Corporate Guarantee given by the Company


217

ANNEXURE XXII

CONSOLIDATED CAPITALISATION STATEMENT, AS RESTATED

Rs. In Million

Particulars As at MARCH 31, 2010

Borrowings

Short term 1,724.06

Long Term debt 7,401.46

Total debt 9,125.52

Shareholders' funds

Share capital 158.46

Minority Interest 2,027.69

Share Application Money -

Securities Premium 1,364.43

General Reserve 6.00

Debit balance in Profit and Loss Account (16.98)

Total shareholders' funds 3,539.60

Long-term debt/equity ratio 2.09

Total Short term debt/equity ratio 0.49

Notes 1. Short term debts represent debts which are due within twelve months from March 31, 2010

2. Long term debts represent debts other than short term debts, as defined above.

3. The figures disclosed above are based on the Summary Statement of Assets and Liabilities, as Restated of

the Company as at March 31, 2010

4. Long Term Debts/ Equity = Long Term Debts/Shareholders' Funds

5. Post Issue figure will be determined only after finalization of the issue price.

6. Vide Resolution passed at the Shareholders Meeting of the company held on July 20, 2006, the Company

has sub-divided each share of Rs. 100/- each into 10 shares of Rs.10/- each.

7. Vide Resolution passed at the meeting of the Board of Directors of the company held on June 11, 2010, the

company issued 47,217,888 Equity Shares as Bonus Shares by capitalisation of general reserves and

securities premium account.

218

ANNEXURE XXIII

CONSOLIDATED SUMMARY STATEMENT OF ACCOUNTING RATIOS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

1) (a) Restated Basic Earning per share Rs. 2.00 (2.05) (0.32) 0.32 (0.23)

(b) Restated Diluted earning per share Rs. 1.38 (2.05) (0.32) 0.29 (0.23)

(c) Restated net asset value per share Rs. 38.97 31.68 26.40 17.01 5.64

2) Return on Net Worth (%) 3.55% -4.48% -0.91% 1.68% -3.92%

3) (a) No. of Shares* 15,739,296 15,739,296 15,739,296 13,932,700 1,017,580

(b) Weighted Average no. of shares*

- for Basic Earnings per share 15,739,296 15,739,296 14,740,718 11,752,988 10,175,800

-for Bonus Shares 47,217,888 47,217,888 47,217,888 47,217,888 47,217,888

- for Diluted Earnings per share 43,616,312 43,616,312 36,100,366 19,110,045 11,366,737

* Equity shares of Rs.10 each

Notes:

1) The ratios have been computed as follows:

Earning per Share – Basic and Diluted = Adjusted Profit / (Loss) after Tax but before Extraordinary

Items

Weighted average number of equity shares outstanding during

the year

Net Asset Value per Share = Net Worth excluding Revaluation Reserve

Weighted Average Number of Equity Shares Outstanding

during the year

Return on Net Worth = Adjusted Profit / (Loss) after Tax but before Extraordinary

Items

Net Worth excluding Revaluation Reserve

2) Earnings per share (EPS) has been calculated in accordance with Accounting Standard 20 - Earnings Per

Share. EPS for the half year ended March 31, 2010 has not been annualised.

3) Restated profit / (loss) has been considered for the purpose of computing the above ratios.

4) Vide Resolution passed at the meeting of the Board of Directors of the company held on June 11, 2010, the

company issued 47,217,888 Equity Shares as Bonus Shares by capitalisation of general reserves and

securities premium account.

5) Vide Resolution passed at the Shareholders Meeting of the company held on July 20, 2006, the Company

has sub-divided each share of Rs. 100/- each into 10 shares of Rs.10/- each.

6) 1,067,300 equity shares of Rs 10/- each were forfeited during the year ended March 31, 2008

219

AUDITORS‟ REPORT

To,

The Board of Directors,

Entertainment World Developers Limited.

(Formerly known as Entertainment World Developers Private Limited)

G-16, R.R.Hosiery Building,



Off Dr. E. Moses Road,

Mahalaxmi, Mumbai- 400 011

Dear Sirs,

Re: Proposed initial public offer of equity shares having a face value of Rs. 10/- each for cash, at an issue

price to be arrived at by the book building process (referred as the „Offer‟).

____________________________________________________________________________________________

We have reviewed and examined the unconsolidated financial information of Entertainment World Developers

Limited (Formerly known as Entertainment World Developers Private Limited) („EWDL‟ or „the Company‟)

annexed to this report and initialed by us for identification. The financial information has been prepared in

accordance with the requirements of Part II of Schedule II to the Companies Act, 1956 („the Act‟), the Securities and

Exchange Board of India („SEBI‟) – (Issue of Capital and Disclosure Requirements) Regulations, 2009 (the „ICDR

Regulations‟) and terms of engagement agreed upon by us with the Company. The unconsolidated financial

information has been prepared by the Company and approved by its Board of Directors.

A. Unconsolidated Financial Information:

The unconsolidated financial information referred to above, relating to profits and losses and assets and

liabilities of EWDL is contained in Annexure I, II, III and IV to this report:

e) Annexure I contains Unconsolidated Summary Statement of Assets and Liabilities, as restated as at March

31, 2010, 2009, 2008, 2007, 2006;

f) Annexure II contains Unconsolidated Summary Statement of Profits and Losses, as restated for the years

ended March 31, 2010, 2009, 2008, 2007, 2006;

g) Annexure III contains Unconsolidated Summary Statement of Cash Flows, as restated for the years ended

March 31, 2010, 2009, 2008, 2007, 2006,

h) Annexure IV contains the Summary of Significant Accounting Policies and Notes to Unconsolidated

Summary Statements, as restated.

B. Other Unconsolidated Financial Information:

Other unconsolidated financial information relating to EWDL prepared by the Company is attached in

Annexures V to XXII to this report:

a) Unconsolidated Summary Statement of Share Capital, as restated (Annexure V);

b) Unconsolidated Summary Statement of Reserves and Surplus, as restated (Annexure VI);

c) Unconsolidated Summary Statement of Secured Loans, as restated (Annexure VII);

d) Unconsolidated Summary Statement of Unsecured Loans, as restated (Annexure VIII);

e) Unconsolidated Summary Statement of Fixed Assets, as restated (Annexure IX);

f) Unconsolidated Summary Statement of Debtors, as restated (Annexure X);

g) Unconsolidated Summary Statement of Loans and Advances, as restated (Annexure XI);

220

h) Unconsolidated Summary Statement of Cash and Bank Balances, as restated (Annexure XII);

i) Unconsolidated Summary Statement of Investments, as restated (Annexure XIII);

j) Unconsolidated Summary Statement of Current Liabilities and Provisions, as restated (Annexure XIV);

k) Unconsolidated Summary Statement of Income from Operations and Other Income, as restated (Annexure

XV);

l) Unconsolidated Summary Statement of Employee Remuneration and Benefits, as restated (Annexure XVI)

m) Unconsolidated Summary Statement of Operating and Other Expenses, as restated (Annexure XVII);

n) Unconsolidated Summary Statement of Interest, as restated (Annexure XVIII);

o) Unconsolidated Summary Statement of Related Party Disclosures, as restated (Annexure XIX);

p) Unconsolidated Capitalisation Statement, as restated (Annexure XX);

q) Unconsolidated Summary Statement of Accounting Ratios, as restated (Annexure XXI);

r) Unconsolidated Summary Statement of Tax Shelters, as restated (Annexure XXII);

s) the Company has not declared any dividend (whether interim or final) during the financial years covered in

this report and hence the information regarding rates of dividend in respect of each class of shares has not

been disclosed;

C. We have reviewed and examined, as appropriate, the unconsolidated financial information contained in these

Annexures and are to state as follows:

(i) The unconsolidated financial information contained in these Annexures is based on the audited

unconsolidated financial statements of the Company for the years ended March 31, 2010, 2009, 2008, 2007

and 2006.

(ii) The unconsolidated financial statements for the year ended March 31, 2006 have been audited by M/s M.

Munshi & Company, Chartered Accountants. We have relied on these financial statements for the year ended

March 31, 2006 which have been audited by other auditors for the purpose of this report.

(iii) The Unconsolidated Summary Statement of Assets and Liabilities, Profits and Losses and Statement of

Cash Flows have been restated with retrospective effect to reflect the Significant Accounting Policies being

adopted by the Company as at March 31, 2010, if material.

D. In our opinion, the unconsolidated financial information of the Company attached to this report and contained in

the aforesaid Annexures has been prepared in accordance with Part II of Schedule II of the Act and the ICDR

Regulations.

E. This report is intended for your information and for inclusion in the Offer Document being issued by the

Company with regard to the aforesaid proposed initial public offer of equity shares of the Company for cash and

is not to be used, referred to or distributed for any other purpose without our prior written consent.

For Deloitte Haskins & Sells

Chartered Accountants

(Firm‟s Registration No.: 117366W)

Mumbai A. B. Jani

Partner

Dated: June 11, 2010 Membership No.: 46488

221

ANNEXURE I

UNCONSOLIDATED SUMMARY STATEMENT OF ASSETS AND LIABILITIES, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

A FIXED ASSETS

Gross Block 990.40 988.42 968.04 697.38 660.42

Less: Depreciation 121.84 91.89 58.44 29.97 6.30

Net Block 868.56 896.53 909.60 667.41 654.12

Capital Work- In- Progress - - 2.36 197.89 53.71

Total (A) 868.56 896.53 911.96 865.30 707.83

B INVESTMENTS (B) 1,301.13 1,088.93 1,113.09 554.71 -


ADVANCES

Sundry Debtors 48.51 25.03 124.55 108.72 14.00

Cash and Bank Balances 46.03 75.43 63.20 81.82 24.86

Loans and Advances 939.32 1,065.90 1,448.18 955.30 468.18

Total (C) 1,033.86 1,166.36 1,635.93 1,145.84 507.04


Current Liabilities 42.21 78.69 61.13 135.53 105.96

Provisions 0.35 1.37 2.78 2.99 0.70

Secured Loans 760.56 804.71 990.93 1,053.13 706.22

Unsecured Loans 1,391.49 1,174.43 750.00 550.00 4.77



124.16 125.08 124.31 108.47 66.63

Total (D) 2,318.77 2,184.28 1,929.15 1,850.12 884.28

E Net Worth (A+B+C-

D)

884.78 967.54 1,731.83 715.73 330.59

F Represented by:

1) Share Capital 158.46 158.46 158.46 140.39 102.83


3) Reserves and Surplus:

(a) Securities Premium Account 624.82 624.82 624.82 473.97 111.88

(b) Profit and Loss Account 101.50 86.76 68.55 38.64 -

Total [(1)+(2)+(3)] 884.78 967.54 1,731.83 715.73 343.54

Less: Debit balance in Profit and Loss

Account - - - - (12.95)

G Net Worth 884.78 967.54 1,731.83 715.73 330.59

The accompanying Summary of Significant Accounting Policies and Notes to Unconsolidated Summary Statements are

an integral part of this Statement.

222

ANNEXURE II

UNCONSOLIDATED SUMMARY STATEMENT OF PROFIT AND LOSS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

INCOME

Income From Operation 266.68 248.35 352.28 309.17 26.05

Other Income 12.75 67.04 13.75 19.03 0.10

Total Income 279.43 315.39 366.03 328.20 26.15

EXPENDITURE



Interest 110.50 114.30 95.31 80.43 -

Depreciation 30.66 48.30 41.42 36.06 8.60


PROFIT BEFORE TAX 17.85 4.74 21.24 17.39 9.54


-Current Tax 3.04 0.49 2.15 1.54 0.80

-Wealth Tax 0.07 0.06 0.05 0.03 -

-Fringe Benefits Tax - 0.30 1.72 1.01 0.35

NET PROFIT AFTER TAX AS PER AUDITED


14.74 3.89 17.32 14.81 8.39

Adjustments made on account of restatement ( Refer Note B.1

of Annexure IV)

- 14.32 12.59 36.78 (21.34)

NET PROFIT / (LOSS) AFTER TAX, AS RESTATED 14.74 18.21 29.91 51.59 (12.95)

Balance brought forward from previous year, as restated 86.76 68.55 38.64 (12.95) -

BALANCE CARRIED FORWARD, AS RESTATED 101.50 86.76 68.55 38.64 (12.95)

The accompanying Summary of Significant Accounting Policies and Notes to Unconsolidated Summary Statements


223

ANNEXURE III

UNCONSOLIDATED SUMMARY STATEMENT OF CASH FLOWS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006


Profit / (Loss) Before Tax, as restated 17.85 19.06 33.83 54.17 (11.80)

Adjustments for:

Depreciation 30.66 33.98 28.83 23.70 5.51

Preliminary Expenses Written off - - - - 0.82

Loss on sale of Fixed Assets 0.77 0.45 0.40 0.07 -

Interest Income (4.41) (64.54) (6.02) (10.40) (0.10)

Dividend Income - (0.06) (0.48) (3.80) -





Forfeiture of Security Deposit (0.12) (0.07) (0.99) (4.01) -



(Increase)/ Decrease in receivables (24.00) 99.01 (16.65) (94.72) (14.00)

Decrease/(Increase) in loans and advances 5.50 32.97 (446.72) (461.85) (446.97)

(Decrease) /Increase in payables (34.10) 16.92 (74.03) 35.78 99.51

Cash generated from/(used in) Operations 101.37 252.27 (386.05) (380.70) (367.03)

Less: Taxes paid 19.93 0.17 (36.10) (27.77) (0.35)

Net Cash generated from/(used in) Operating

Activities

121.30 252.44 (422.15) (408.47) (367.38)



Purchase of fixed assets (5.15) (19.73) (76.95) (181.76) (292.58)

Investment in Subsidiaries and Associate Companies - (29.63) (1,166.04) (554.71) -


Companies

1.30 43.72 617.73 - -

Purchase of Current Investments - - (437.99) - -

Sale of Current Investments - 10.06 427.98 0.07 -

Share Application Money paid (Pending Allotment) (20.00) (1.10) - - -

Share Application Money Received Back 1.20

Dividend Received - 0.06 0.49 3.81 -

Interest Income 0.05 66.89 2.03 10.40 0.10

Refund of Loan from Other Companies 55.35 2,410.43 - - -

Loans to Other Companies (14.08) (2,348.87) (9.60) - -

Loans to Subsidiary Companies (680.46) 285.04 - - -

Refund of Loan from Subsidiary Companies 545.43 - - - -

Net Cash (used in) / Flow from Investing

Activities

(114.66) 417.60 (641.29) (721.65) (292.48)


Proceeds from issue of share capital - - 12.27 25.66 125.99

224


2010 2009 2008 2007 2006

Proceeds from Securities Premium - - 93.93 251.60 -

Share application money - 250.00 880.00 62.72 -

Repayment of Share application money (97.50) (1,032.50) - - -

Proceeds from Long Term Borrowings - - - 346.91 490.07

Proceeds from issue of debentures - - 200.00 550.00 -

Debenture Issue Expenses - - - (6.43) -

Proceeds from Secured Loans - 101.74 215.57 - -

Repayment of Secured Loans (44.15) (287.97) (277.77) - -

Proceeds from Unsecured Loans 2,002.35 768.81 339.72 - -

Repayment of Unsecured Loans (1,785.29) (344.38) (339.72) (4.77) 4.77

Deposits from Licensees (0.95) 0.79 15.83 41.82 61.32

Interest Paid (110.50) (114.30) (95.01) (80.43) -

Net Cash (used in)/flow from Financing Activities (36.04) (657.81) 1,044.82 1,187.08 682.15

Net increase in cash and cash equivalents (29.40) 12.23 (18.62) 56.96 22.29


years

75.43 63.20 81.82 24.86 2.57

Cash and cash equivalents as at end of years 46.03 75.43 63.20 81.82 24.86


Cash on Hand 0.23 0.34 0.45 0.18 1.05



In Fixed Deposit Accounts* 34.91 41.37 25.36 79.10 22.19

Total 46.03 75.43 63.20 81.82 24.86


225

ANNEXURE IV

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO UNCONSOLIDATED

SUMMARY STATEMENTS, AS RESTATED

A. SIGNIFICANT ACCOUNTING POLICIES:

a. Basis for preparation of Accounts:

The accounts have been prepared to comply in all material aspects with applicable Accounting Principles in

India and the relevant provisions of the Companies Act, 1956.

b. Use of Estimates:

The preparation of Financial Statements, in conformity with the generally accepted Accounting Principles,

requires estimates and assumptions to be made that affect the reported amounts of Assets and Liabilities on

the date of Financial Statements and the reported amounts of Revenues and Expenses during the reported

period. Differences between the actual results and estimates are recognized in the year in which the results

are known / materialized.

c. Revenue Recognition:

(i) Rental income, Common Area Maintenance charges, Project Management fees etc. are recognized

when no significant uncertainty as to collectability or realisability exists.

(ii) Interest income is recognized on time proportion basis.

(iii) Dividend income is recognized when right to receive the same is established.

d. Fixed Assets:

(i) Fixed Assets are stated at cost net of recoverable CENVAT and rebates etc.

(ii) Costs include finance costs till the completion of constructions and directly attributable costs.

(iii) Expenses incurred relating to project prior to completion of construction are classified as

incidental expenses and disclosed under Capital Work-In-Progress (CWIP).

e. Depreciation:

Depreciation is provided on Straight-Line basis at the rate and in manner specified in Schedule XIV of the

Companies Act, 1956 except in case of certain categories of Plant and Machinery and Office Equipment,

which are being depreciated based on the management‟s estimate of useful life of such assets as follows:

Type of Assets Estimated Useful Life (In

Years)

Electrical Installations/ Generators/ Transformers 15

Central Cooling Equipments 15

Office Equipments 7

Depreciation on Assets acquired during the year is provided on pro-rata basis with reference to the month

of addition.

f. Leases:

Assets given on lease are accounted in accordance with Accounting Standard 19 on “Leases”.

226

Operating Lease:

Assets given on Operating Leases are included in Fixed Assets. Lease income is recognized in the Profit

and Loss Account.

g. Borrowing costs:

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as

part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to

get ready for its intended use or sale. All other borrowing costs are charged to revenue.

h. Investments:

Long term Investments are carried at cost. Provision is made to recognize any diminution, other than

temporary, in the value of such Investments.

Current Investments are stated at lower of cost and fair value.

i. Foreign Currency Transactions:

Transactions in Foreign Currency are recorded at the exchange rates prevailing on the date of transaction.

Monetary items are translated at the year-end rates. The exchange difference between the rate prevailing on

the date of transaction and on the date of settlement as also on translation of monetary items at the end of

the year is recognised as income or expense, as the case may be.

j. Impairment of Assets:

At the end of each year, the Company determines whether a provision should be made for impairment loss

on fixed assets by considering the indications that an impairment loss may have occurred in accordance

with Accounting Standard 28 on „„Impairment of Assets‟‟. Where the recoverable amount of any Fixed

Asset is lower than its carrying amount, a provision for impairment loss on Fixed Asset is made for the

difference.

k. Employee Benefits:

(a) Post Employment Benefits and Other Long Term Benefit:

i) Contributions under Defined Contribution Plans in the form of Provident Fund and

Employees‟ State Insurance Corporation (ESIC) are recognized in the Profit and Loss

Account in the year in which the employee has rendered the service.

ii) Defined Benefit and Other Long term Benefit Plans :

The Company‟s Liability towards Defined Benefit Plan in the form of Gratuity is funded

through scheme administered by the Life Insurance Corporation of India (LIC) and

administered through respective Trust set-up by the Company. The liability is determined

on the basis of actuarial valuation being carried out at each Balance Sheet date using the

Projected Unit Credit Method. The retirement benefit obligation recognized in the

Balance Sheet represents the total of present value of the defined benefit obligation as

reduced by unrecognized past service cost and the fair value of plan assets as at the

balance sheet date. Any assets resulting from this calculation are restricted to the present

value of available refunds from the plan or reductions in future contributions to the plan.

Actuarial gains and losses are recognized immediately in the Profit and Loss Account in

the year of occurrence of such gains and losses. Past service cost is recognized as an

227

expense on a straight-line basis over the average period until the benefits become vested

to the extent that the benefits are already vested immediately following the introduction

of , or changes to, a defined benefit plan, past service cost is recognized immediately.

(b) Short Term Employee Benefits:

Short-term employee benefits are recognized as expenses at the undiscounted amount in the Profit

and Loss Account of the year in which the related services are rendered.

l. Income taxes:

Tax expense comprises of current tax, deferred tax and fringe benefits tax. Current tax is measured at

amount expected to be paid to / recovered from tax authorities using the applicable tax rates. Deferred

income tax reflect the current period timing differences between taxable income and accounting income for

the period and reversal of timing differences of earlier years/ period. Deferred tax assets are recognised

only to the extent that there is reasonable certainty that sufficient future income will be available except

that deferred tax assets, in case there are unabsorbed depreciation and losses, are recognised if there is

virtual certainty that sufficient future taxable income will be available to realise the same. Fringe benefits

tax is recognized in accordance with the relevant provisions of the Income-tax Act, 1961 and the Guidance

Note on Fringe benefits tax issued by the Institute of Chartered Accountants of India (ICAI). (Refer Note B

5 below)

m. Contingent Liabilities:

Contingent Liabilities, if any, are disclosed in the Notes on Accounts. Provision is made in the Accounts if

it becomes probable that any outflow of resources embodying economic benefits will be required to settle

the obligation.

B. NOTES TO UNCONSOLIDATED SUMMARY STATEMENTS, AS RESTATED

1. Adjustments/reclassifications done in the Unconsolidated Summary Statements:

The following adjustments/reclassifications have been made in the Unconsolidated Summary Statement of

Assets and Liabilities, Unconsolidated Summary Statement of Profit and Loss and Unconsolidated

Summary Statement of Cash Flows:

Adjustments:

Adjustments have been made in the Unconsolidated Summary Statement of Assets and Liabilities,

Unconsolidated Summary Statement of Profit and Loss and Unconsolidated Summary Statement of Cash


(Rs. in Million)


2006 2007 2008 2009

Net Profit (Loss) after tax as per Audited Financial Statements

(A)

8.39 14.81 17.32 3.89

Preliminary expenses and deferred revenue expenditure written

off

(14.80) 14.80 - -

Prepayment Charges (9.63) 9.63 - -

Depreciation 3.09 12.35 12.59 14.32

Total of Adjustments (B) (21.34) 36.78 12.59 14.32

Net (Loss)/Profit after tax, as restated (A+ B) (12.95) 51.59 29.91 18.21

228

Notes:

Preliminary expenses and deferred revenue expenditure:

Preliminary expenses and deferred revenue expenditure written off in the Audited Financial Statements for

the year ended March 31, 2007 have been adjusted in the year ended March 31, 2006 to which the same

relate.

Prepayment charges:

Prepayment charges pertaining to loan repaid were originally accounted in the year ended March 31, 2006.

The same were, however, not written off in the Profit and Loss Account in the said year but were carried

forward in the Balance sheet as the Company expected a waiver for the same from the lender.

Subsequently, the Company could not get a waiver from the lender on the said charges, which were then

written off in the year ended March 31, 2007. However, for the purposes of the Unconsolidated Summary

Statement of Profit and Loss, the Prepayment charges are considered in the year ended March 31, 2006.

Depreciation:

The Company has, during the year ended March 31, 2010, revised the estimated useful life of some of its

fixed assets, resulting into the depreciation for the said year being lower by Rs. 42.35 million and the profit

for the said year being higher by the like amount. However, for the purposes of the Unconsolidated

Summary Statement of Profit and Loss, the effect of the aforesaid has been considered in the respective

years from the year in which the said assets were capitalised in the books of account.

Reclassifications:

Reclassifications have been made in the Unconsolidated Summary Statement of Assets and Liabilities and

Unconsolidated Summary Statement of Profit and Losses and Unconsolidated Summary Statement of Cash


a. Deposits received from Licensee have been reclassified from Current Liabilities and disclosed

separately in the Unconsolidated Summary Statement of Assets and Liabilities for all the years

presented.

b. Overdrawn bank balances aggregating to Rs. 66.56 Million, disclosed as part of Secured Loan in

the Audited Financial Statements as at March 31, 2006 have been reclassified as part of Current

Liabilities.

c. Refundable Security deposits aggregating to Rs. 150.00 Million as at March 31, 2005 and Rs.

300.00 Million as at March 31, 2006, which were disclosed as part of Fixed Assets in the Audited

Financial Statements for the respective years have been reclassified as part of Loans and Advances

in the Unconsolidated Summary Statement of Assets and Liabilities in the respective years.

d. Share Application Money aggregating to Rs. 61.27 Million, which were disclosed as part of

Investments in the Audited Financial Statements as at March 31, 2006, have been reclassified as

part of Loans and Advances in the Unconsolidated Summary Statement of Assets and Liabilities

in the respective years.

The effects of the following have not been given in the Unconsolidated Summary Statement of Assets

and Liabilities, Unconsolidated Summary Statement of Profit and Loss and Unconsolidated

Summary Statement of Cash Flows on the grounds that the figures involved are not material:

229

a. Excess provision of income-tax of Rs. 0.12 million relating to the year ended March 31, 2007

computed on the completion of the Assessment by the Income-tax authorities has not been

adjusted in the respective years.

b. Sundry Balances written back aggregating to Rs. 3.09 million, Rs. 0.53 million, Rs. 0.29 million

and Rs. 0.05 million in the Audited Financial Statements for the year ended March 31, 2010,

March 31, 2009, March 31, 2008 and March 31, 2007 respectively have not been adjusted in the


c. Preliminary Expenses aggregating to Rs. 0.82 million written off in the Audited Financial

Statements for the year ended March 31, 2006 and relating to earlier years have not been adjusted

in the respective years.

d. Tax impact of adjustments has not been considered as the Company was covered by the provisions

relating to Minimum Alternate Tax under the Income-tax Act, 1961 and the tax impact is also not

material.

e. The Company has adopted the Revised Accounting Standard (AS) 15 on „Employee Benefits‟

with effect from the year ended March 31, 2007. The effect of the Revised AS 15 has not been

given in the years prior to the said year-end on the grounds of the same not being material.

f. Sundry Balances written off aggregating to Rs. 1.29 million, Rs. 0.26 million, Rs. 0.82 million and

Rs. 0.03 million in the Audited Financial Statements for the year ended March 31, 2010, March

31, 2009, March 31, 2008 and March 31, 2007 respectively have not been adjusted in the


2. Contingent Liabilities:

The following are the details of the Contingent Liabilities :

(Rs. in Million)


2010 2009 2008 2007 2006

a) Bank Guarantees Outstanding 55.68 55.68 6.13 6.13 6.60

b) Corporate Guarantees given to Banks / Financial

Institutions

7248.88 4179.88 2915.20 - -

c) Demands of Income Tax Authorities disputed in

appeal

Amounts deposited by the Company against above

demand

13.77

14.88

13.77

14.88

13.77

5.11

1.91

1.00

-

-

d) Demands of Sales Tax Authorities disputed in

appeal

2.90 2.90 - - -

e) Uncalled liabilities in respect of Investment in

partly paid-up Equity shares

22.68 22.68 30.81 644.61 -

f) Claim by Madhya Pradesh Housing Board in

respect of forfeiture of shares

115.00 115.00 115.00 115.00 10.67

g) Export obligation undertaken under "Export

Promotion of Capital Goods Scheme"

83.24 83.24 83.24 77.46 50.22

h) Service Tax not collected and paid on rental

income

54.04 33.40 14.59 - -

3. The Company has not received any intimation from the suppliers regarding their status under Micro, Small

and Medium Enterprises Development Act, 2006 and hence the disclosures required under the Act have

been given accordingly.

4. The Principal business of the Company is Mall Operations and all other activities of the Company revolve

230

around its main business. Hence there is only one reportable segment as defined by Accounting Standard

17 on “Segment Reporting”.

5. The tax effect of significant timing differences during the year that have resulted in Deferred Tax Assets

and Liabilities are given below.

(Rs. in Million)

PARTICULARS As at March 31,

2010 2009 2008 2007 2006

Deferred Tax Liabilities:

Depreciation 15.50 9.38 8.38 6.03 3.96

Other timing differences: - 0.27 - -

Total Deferred Tax Liabilities 15.50 9.38 8.65 6.03 3.96

Deferred Tax Assets:

Carried forward business loss as per Income-tax Act 3.33 - - - -

Carried forward unabsorbed depreciation as per Income-tax Act 48.12 40.35 22.61 11.49 4.83

Other timing differences: 0.54 1.24 2.14 0.93 0.09

Total Deferred Tax Assets 51.99 41.59 24.75 12.42 4.92

Net Deferred Tax Assets 36.49 32.21 16.10 6.39 0.96

The net Deferred Tax Assets as at March 31, 2010 have not been accounted in view of the requirements of

certainty/virtual certainty as stated in the Accounting Standard 22 on “Accounting for Taxes on Income”.

6. The Company is entitled to tax credit in respect of Minimum Alternate Tax (MAT credit) under the

provisions of the Income-tax Act, 1961. However, considering the degree of probability of availment of

the MAT Credit in future years, which is based on convincing evidence that the Company will pay normal

tax in future as envisaged by the Guidance Note on Accounting for Credit available in respect of Minimum

Alternate Tax (MAT) under the Income-tax Act, 1961, the MAT credit has not been accounted by the

Company. The accounting for the same will be reviewed at each Balance Sheet date.

(Rs. in Million)

Year Mat Credit (Cumulative amounts)

March 31, 2010 8.14

March 31, 2009 4.77

March 31, 2008 4.34

March 31, 2007 2.18

March 31, 2006 -

7. Leases

As a Lessor:

The Company has designated area in a Shopping Mall on operating lease on leave and license basis. Details

of Assets, included in Fixed Assets, given on operating lease are given below:

(Rs. in Million)

Year ended Income recognized in the Profit and Loss Account

March 31, 2010 177.65

March 31, 2009 161.01

March 31, 2008 149.18

March 31, 2007 141.55

March 31, 2006 22.55

231

(Rs. in Million)


31, 2010

As at March

31, 2009

As at March

31, 2008

As at March

31, 2007

As at March

31, 2006

Building:

Gross Block 588.44 588.44 588.44 415.99 415.99

Depreciation for

the year

9.59 9.59 7.48 6.78 1.70

Accumulated

Depreciation

35.14 25.55 15.96 8.48 1.70

Details of future minimum lease rentals receivable are given below:

(Rs. in Million)


31, 2010

As at March

31, 2009

As at March

31, 2008

As at

March 31,

2007

As at

March 31,

2006

Not later than one year 143.77 136.04 131.01 140.73 -

Later than one year and

not later than five years

523.85 445.91 306.13 339.41 -

Later than five years 1181.53 777.27 680.58 243.58 -

Total 1,849.15 1,359.22 1,117.72 723.72 -

8. The following are the disclosures in relation to Joint Venture of the Company:

a. Jointly Controlled Entity :

Name of the Entity Country of Incorporation % Holding

Naman Mall Management Company Private Limited India 50 %

b. Interests in the Assets, Liabilities, Income and Expenses with respect to Jointly Controlled

Entity.

(Rs. in Million)

PARTICULARS As at March

31, 2010

As at March

31, 2009

As at March

31, 2008

As at March

31, 2007

ASSETS

1 Fixed Assets 337.51 397.83 258.98 129.12

2 Investment - - - 1.52

3 Current Assets, Loans

and Advances

a Cash and Bank

Balances

16.04 10.27 8.52 1.19

b Loans and Advances 32.10 3.99 10.53 8.11

c Inventories 60.95 - - -

d Sundry Debtors 0.82 - - -

LIABILITIES

1 Loan Funds

a Secured Loans 126.54 236.24 142.50 12.55

b Unsecured Loans - 17.05 4.75 -

2 Current Liabilities and

Provisions

a Liabilities 10.62 25.95 5.09 1.94

b Provisions 0.79 0.10 0.09 0.06

232

PARTICULARS As at March

31, 2010

As at March

31, 2009

As at March

31, 2008

As at March

31, 2007

PROFIT & LOSS

ACCOUNT

1. Income

a. Income from

Operations

75.02 - - -

b. Other Income 1.08 - - -

2. Expenditure

a. Operating and

other Expenses

32.00 - - -

b. Interest 29.00 - - -

c. Depreciation 6.50 - - -

d. Provision for

Taxation

3.69 - - -

OTHER MATTERS

Capital Commitments - 17.01 103.02 12.15

Contingent Liability 8.92 8.92 - -

9. Fixed assets include vehicles which are in the process of being transferred in the name of the company.

(Rs. in Million)

As at March 31, Cost WDV

2010 - -

2009 1.05 0.77

2008 2.12 1.75

2007 2.12 1.96

10. Deposits from licensees, refundable on termination / alteration of leave and license agreements are

considered as long-term fund.

11. The following expenses disclosed in Annexure XVI, XVII and XVIII are net of amounts claimed from

various group companies as reimbursement of expenses incurred on their behalf, as detailed below:

(Rs. in Million)

Particulars As at March 31, 2010 As at March 31, 2009

Advertisement and Sales Promotion 3.70 -

Legal and Professional Fees 1.83 1.64

Travelling and Conveyance Expenses 1.69 2.54

Salary, Wages and Bonus 5.18 33.39

Miscellaneous Expenses - 2.92

Interest on Term Loan - 0.87

Insurance - 0.66

12. Employee Benefits:

The disclosure required by Accounting Standard 15 on “Employee Benefits” (AS 15), given below, has

been adopted by the Company with effect from April 1, 2006.

233

i) Contributions are made to Provident Fund and ESIC, which cover all the regular employees.

Amount recognized as expense in respect of these defined contribution plans as follows:

(Rs. in Million)


31, 2010

As at March

31, 2009

As at March

31, 2008

As at March

31, 2007

Contribution made to

Provident Fund and

ESIC

0.55 1.72 3.65 0.91

ii) Defined Benefit Plan

The disclosure as required under AS 15 as per actuarial valuation at the year-end regarding the

Employees Retirements Benefits Plan for gratuity is as follows:

(Rs. in Million)


31, 2010

As at March

31, 2009

As at March

31, 2008

As at March

31, 2007

Projected benefit

obligation, at the


0.29 0.82 0.30 0.10

Service cost 0.07 0.16 0.47 0.14

Interest cost 0.02 0.06 0.03 0.01

Actuarial loss 1.38 0.75 0.01 0.05

Benefits paid 1.60 1.29 - -

Projected benefit

obligation, at the end of

the year

0.16 0.29 0.82 0.30

Defined Benefit obligation

liability as at the Balance

Sheet date is wholly

funded by the Company

Change in Plan Assets

Fair Value of Assets at the


1.95 0.61 0.21 -

Expected Return on Assets 0.16 0.05 0.02 0.01

Actuarial Gain (Loss) 0.21 - 0.03 -

Benefits Paid 1.60 - - -

Contributions - 1.29 0.34 0.21

Fair Value of Plan Assets

at the end of the year

0.71 1.95 0.61 0.21

Gratuity Cost for the

year

Service Cost 0.07 0.16 0.47 0.14

Interest Cost 0.02 0.06 0.03 0.01

Expected Return on Assets 0.16 0.05 (0.02) (0.01)

Amortisation of Actuarial

Loss /(Gain)

1.17 (0.75) (0.02) 0.05

Net Periodic Gratuity

Cost

1.10 (0.58) 0.47 0.20

Net Asset/ (Liability) at

the end of the year.

234


31, 2010

As at March

31, 2009

As at March

31, 2008

As at March

31, 2007

Present Value of

Obligation at end of the

Year

0.16 0.29 0.82 0.30

Fair Value of Plan Asset at

end of the Year

0.71 1.95 0.61 0.21

Funded Status 0.55 1.65 (0.21) (0.09)

Unrecognized actuarial

gain/loss at end of the year

- - - -

Net Asset/ (Liability)

Recognized in Balance

Sheet

0.55 1.65 (0.21) (0.09)

Assumptions:

For year ended

March 31, 2010

For year ended

March 31, 2009

For year ended

March 31, 2008

For year ended

March 31, 2007

Discount rate 8.50% 7.50% 8.50% 8.25%

Inflation Rate 5.00% 5.00% 6.00% 4.00%

Rate of Return

on Plan Assets

8.00% 8.00% 8.00% 7.50%

13. Earnings per share (EPS) computed in accordance with Accounting Standard 20 (AS 20) on “Earnings Per

Share”:

(Rs. in Million)

Particulars Year ended

March 31,

2010

Year ended

March 31,

2009

Year ended

March 31,

2008

Year ended

March 31,

2007

Year ended

March 31,

2006

Profit After Taxation and

exceptional item, as

restated

14.74 18.21 29.91

51.59

(12.95)

Equity Shares outstanding

as at the year end (in Nos.)

15,739,296 15,739,296 15,739,296 15,000,000 11,243,100

Weighted average

number of Equity Shares

used as denominator for

calculating Basic

Earnings Per Share

(Including Bonus Shares

see Note ii below)

62,957,184 62,957,184

61,958,606 58,970,876 57,393,688

Add: Dilutive number of

Shares

Conversion of debentures 27,877,016 27,877,016 21,359,648 6,777,044 -

Share application money - - - 580,013 1,190,937

Number of Equity Shares

used as denominator for

calculating Diluted

Earnings Per Share

90,834,200 90,834,200 83,318,254 66,327,933 58,584,625

Nominal Value per Equity

Share (in Rs.)

10.00 10.00 10.00 10.00 10.00

Earnings Per Share (Basic)

(in Rs.)

0.23

0.29 0.48 0.87 (0.23)

Earnings Per Share

(Diluted) (in Rs.)

0.16 0.20 0.36 0.78 (0.23)

235

Notes:

i) The Company plans to repay share application money entirely and hence it has not been

considered while computing dilutive EPS for the year ended March 31, 2010, March 31,2009 and

March 31, 2008.

ii) The Company has issued 47,217,888 bonus Equity Shares on June 11, 2010, which have been

considered in the calculation of weighted average number used in the denominator.

14. In the month of April 2009, the Income-tax Department had conducted a search on the Company and had

seized some of the documents and accounting records (electronic databases) from the Company. For the

purpose of audit, the Company has restored the accounting records from the back-up databases available

with the Company, which continues to be used thereafter as master records. The documents relevant for the

purpose of preparation of financial statements and audit thereof are available with the Company.

15. During the year ended March 31, 2010, the company has provided for professional charges aggregating to

Rs 15.89 Million on account of services received for the proposed initial public offering (IPO) of the

company. The same is being carried forward under Loans and Advances to be adjusted against securities

premium on completion of the said IPO.

16. On April 5, 2007 the name of the Company had been changed to EWDPL India Private Limited from

Entertainment World Developers Private Limited. The name had been rechanged to Entertainment World

Developers Private Limited during the year ended March 31, 2009.

On February 5, 2010, the Company has been converted from a private limited company to public limited company.

Consequently, its name has been changed from Entertainment World Developers Private Limited (EWDPL) to

Entertainment World Developers Limited (EWDL).

236

ANNEXURE V

UNCONSOLIDATED SUMMARY STATEMENT OF SHARE CAPITAL, AS RESTATED

Rs. In Millions


2010 2009 2008 2007 2006

AUTHORISED:

Authorised Capital

Nos. of Equity Shares 100,000,000 17,000,000 17,000,000 15,000,000 1,500,000

Face Value (In Rs.) 10 10 10 10 100

Total Value 1,000.00 170.00 170.00 150.00 150.00

ISSUED, SUBSCRIBED AND PAID-UP:

Nos. of Equity Shares 15,739,296 15,739,296 15,739,296 13,932,700 1,017,580

Face Value (In Rs.) 10 10 10 10 100

Total Value 157.39 157.39 157.39 139.32 101.76

Nos. of Equity Shares - - - 1,067,300 106,730

Face Value (In Rs.) - - - 10.00 100.00

Paid up Value (In Rs.) - - - 1.00 10.00

Total Value - - - 1.07 1.07

Add: 1,067,300 Equity Shares of Rs.10/- each;

Re.1/- paid-up forfeited

1.07 1.07 1.07 - -

(Refer note B 2 (f) of Annexure IV)

Total 158.46 158.46 158.46 140.39 102.83

Notes:

a) Of the above 1,067,300 Equity Shares of Rs.10/- each, Re.1/- paid-up, are issued for consideration other

than cash.

b) 1,067,300 equity shares of Rs 10/- each were forfeited during the year ended March 31, 2008.

c) During the year ended March 31, 2007, 1,017,580 Equity Shares of Rs. 100/- each were split into

10,175,800 Equity Shares of Rs 10/- each.

237

ANNEXURE VI

UNCONSOLIDATED SUMMARY STATEMENT OF RESERVES AND SURPLUS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Securities Premium Account: 624.82 624.82 624.82 473.97 111.88

Surplus in Profit and Loss Account 101.50 86.76 68.55 38.64 -

Total 726.32 711.58 693.36 512.61 111.88

238

ANNEXURE VII

UNCONSOLIDATED SUMMARY STATEMENT OF SECURED LOANS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Loans and Advances from Banks

Term loans from Banks and Financial Institutions (Refer

Note below)

UCO Bank 758.16 798.26 981.58 945.21 704.49

State Bank of Indore - - - 100.00 -

Total 758.16 798.26 981.58 1,045.21 704.49

Vehicle Loans from Banks*

HDFC Bank 1.75 4.52 4.96 0.16 0.44

ICICI Bank 0.53 1.44 3.43 6.44 0.98

Centurion Bank - - - 0.03 0.31

Kotak Mahindra Bank 0.12 0.49 0.96 1.29 -

760.56 804.71 990.93 1,053.13 706.22

*Secured by hypothecation of Vehicles acquired out of the Loans

Notes: The following table shows the major Terms and Conditions of the secured Term loans obtained.

Lender Sanctioned

Amount (in

Million)

Rate of

Interest (in

%)

Repayment

Date

Prepayment

terms

Security offered Lender

Term

Loans

UCO

Bank

825.00 PLR + 1%

(As at

March 31,

2010)

(Reset after

every three

years)

Equal Monthly

Instalments

from June 2006

to December

2014

None Equitable mortgage of Land

belonging to Group

Companies, Personal

guarantee of Managing

Director, Assignment of

future lease rent receivable


charge by way of equitable

mortgage of the Building on

the aforesaid land.

UCO

Bank

175.00 PLR + 1%

(As at

March 31,

2010)

(Reset after

every three

years)

Equal Monthly

Instalments

from

November

2006 to

December

2014

Prepayment

of loan will

attract

penalty 2% of

prepaid

amount

Equitable mortgage of Land

belonging to Group

Companies, Personal

guarantee of Managing

Director, Assignment of

future lease rent receivable


charge by way of equitable

mortgage of the Building on

the aforesaid land.

State

Bank of

Indore

100.00 10.5 payable from

May 13, 2007

to September

13, 2007

No

prepayment is

allowed

Nil

239

ANNEXURE VII

UNCONSOLIDATED SUMMARY STATEMENT OF UNSECURED LOANS, AS RESTATED

Rs. In Million

PARTICULARS Interest

rate

Repayment terms AS AT MARCH 31,

2010 2009 2008 2007 2006

Loans from Subsidiaries:

Treasure World Developers

Private Limited

0% Repayable by

March-2012

- 423.46 - - -

Treasure World Constructions

Private Limited

0% Repayable by

March-2012

391.49 - - - -

Loan from Group Company:

Kalani Industries Private

Limited

12% - 0.73 - - -

Loan from Shareholder:

The Phoenix Mills Limited 19.57% 250.00 - - - -

Loans from Others:

Fab Syntex Private Limited 10% Payable on

demand

- 0.17 - - -

Triple A Real Estates Private

Limited

10% Payable on

demand

- 0.07 - - -

Debentures 0% 750.00 750.00 750.00 550.00 -

(Refer Note below)

Inter Corporate Deposits 10% - - - - 4.77

Total 1,391.49 1,174.43 750.00 550.00 4.77

Note:

The Company has issued unsecured optionally fully convertible debentures of the face value of Rs. 750.00 Millions.

The Convertible Debentures have tenure of up to five years which is extendable at the option of the Debenture

holders.

24

0

AN

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XU

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UN

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Rs.

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Sr.

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AR

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As

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March

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As

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Ma

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As

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March

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March

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Gro

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N

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ing

626.9

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0.1

8

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6.9

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00

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6

26

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1

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0.6

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428.7

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420.1

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295.2

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238.6

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15.4

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5

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1

2.5

1

2.9

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Fu

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33.2

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3

0.2

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26

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1

9.3

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1.3

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8.2

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0.3

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0.2

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F

Veh

icle

s 15.8

7

4.9

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10

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1

9.0

5

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14

.98

1

8.5

6

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13.9

6

1.4

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12.5

0

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tan

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G

So

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3.5

5

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2.9

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3.5

4

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- -

- -

- -

- -

-

T

ota

l 990.4

0

121.8

4

86

8.5

6

98

8.4

2

91

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8

96

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5

8.4

4

90

9.6

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667.4

1

660.4

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-

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865.3

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241

ANNEXURE X

UNCONSOLIDATED SUMMARY STATEMENT OF DEBTORS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Sundry Debtors

Debts outstanding for period exceeding six months:


Unsecured, Considered good 0.24 1.23 - 0.26 -


A 2.40 2.47 0.59 0.26 -

Other Debts:


Unsecured, Considered good 26.11 1.95 111.48 108.46 14.00


B 47.15 23.08 123.96 108.46 14.00

A+B 49.55 25.55 124.55 108.72 14.00

Less: Provision 1.04 0.52 - - -

Total 48.51 25.03 124.55 108.72 14.00

Note: Refer point 29 Annexure XIX for debts due from Related Parties.

242

ANNEXURE XI

UNCONSOLIDATED SUMMARY STATEMENT OF LOANS AND ADVANCES, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Loans and advances

(Unsecured, considered good)

Advances recoverable in cash or in kind or for value to be

received

36.63 38.94 158.73 71.06 97.70

Security Deposits 310.63 311.97 312.13 308.44 307.29

Loans and Advances to Subsidiary Companies 526.63 616.97 902.02 471.73 -

Loans to Other Companies 5.35 34.75 9.60 - -

Share Application money (Pending Allotment) 22.75 3.95 2.85 74.78 61.27

Advance Tax (Net of Provisions) 35.24 58.46 59.64 27.07 1.78

Accrued Interest on Fixed Deposit Receipts 2.09 0.86 3.21 2.22 0.14

TOTAL 939.32 1,065.90 1,448.18 955.30 468.18

Note:

Refer point 12 Annexure XIX for loans given to Subsidiaries and other Related Parties.

243

ANNEXURE XII

UNCONSOLIDATED SUMMARY STATEMENT OF CASH AND BANK BALANCES, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Cash in hand 0.23 0.34 0.45 0.18 1.05

- - - - -

Balance with Scheduled Banks - - - - -

In Current Accounts 10.8

9

33.72 37.39 2.54 1.62

In Fixed Deposit Accounts* 34.9

1

41.37 25.36 79.10 22.19

Total 46.03 75.43 63.20 81.82 24.86


244

ANNEXURE XIII

UNCONSOLIDATED SUMMARY STATEMENT OF INVESTMENTS, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Long Term:

(Unquoted-At cost)

Non-Trade

In Equity Shares of Subsidiary Companies :

49,990 Equity Shares of Ujjain Treasure Bazaar Private Limited

(Formerly known as Horizon Complex Private Limited) of


0.50 0.50 0.50 0.50 -

10,000 Equity Shares of Bhubaneshwar Entertainment World

Developers Private Limited of Rs.10/- each fully paid-up

- 0.10 0.10 - -

10,000 Equity Shares of Entertainment World Developers

Amritsar Private Limited of Rs.10/- each fully paid-up

- - 0.10 - -

10,000 Equity Shares of Gwalior Entertainment World


- 0.10 0.10 - -

750,000 Equity Shares of Jabalpur Treasure Island Private

Limited of Rs.10/- each partly paid up

- - - 75.34 -

100,000 Equity Shares of Raipur Treasure Island Private Limited

of Rs.10/- each fully paid up

- - - 1.00 -

10,000 Equity Shares of Amaravati Treasure Bazaar Private


0.10 0.10 - - -

7,140,000 Equity Share of Marvell Mall Development Company

Private Limited of Rs.10/- each partly paid-up

71.40 71.40 71.40 71.40 -

660,000 Equity Share of Indore Treasure Market City Private

Limited of Rs.10/- each partly paid-up

- - - 73.80 -

600,000 Equity Share of Indore Treasure Town Private Limited

of Rs.10/- each partly paid-up

- - - 163.10 -

89,980 Equity Share of Cassandra Realty Private Limited of


- - - 0.90 -

10,000 Equity Shares of Chandigarh Entertainment World

Private Limited of Rs.10/- each fully paid-up

- - 0.10 0.10 -

758,000 Equity Shares (2008: 7,50,000; 2007: 10,000) of

Nanded Treasure Bazaar Private Limited of Rs.10/- each fully

paid-up

39.42 39.42 11.30 0.10 -

10,000 Equity Shares of Trivandrum Treasure Market City


- 0.10 0.10 - -

10,000 Equity Shares of Treasure World Constructions Private


- - 0.10 - -

10,000 Equity Shares of Treasure MEP Services Private Limited

of Rs.10/- each fully paid-up

- - 0.10 - -

10,000 Equity Shares of Treasure Food & Beverages Private


- - 0.10 - -

10,000 Equity Shares of Nagpur Treasure Market City Private


- 0.10 0.10 - -

10,000 Equity Shares of Treasure Showcase Private Limited

(formerly known as EWDPL Holdings Private Limited) of


0.10 0.10 0.10 - -

10,000 Equity Shares of EWDPL North Realty Private Limited


- 0.10 0.10 - -

245


2010 2009 2008 2007 2006

10,000 Equity Shares of EWDPL Residential Holdings Private


0.10 0.10 0.10 - -

10,000 Equity Shares of EWDPL South Realty Private Limited


- 0.10 0.10 - -

10,000 Equity Shares of EWDPL West Realty Private Limited of


- 0.10 0.10 - -

5,100 Equity Shares of Intesys Technologies Private Limited of


- - 0.05 - -

999,990 Equity Shares (2007: 10,000) of Treasure World


850.01 850.01 850.01 0.10 -

10,000 Equity Shares of Dazzling Properties Private Limited of


- - 0.10 - -

10,000 Equity Shares of Ludhiana Entertainment World Private


- - - 0.10 -

100,000 Equity Shares of Udaipur Treasure Market City Private


- - 1.00 1.00 -

10,000 Equity Shares of Chandigarh Treasure Island Private


- - - 0.10 -

10,000 Equity Shares of Jodhpur Entertainment World


- - 0.10 - -

10,000 Equity Shares of EWDPL Bhilai Hospitality Private


- 0.10 - - -

10,000 Equity Shares of EWDPL Chandigarh Hospitality Private


- 0.10 - - -

10,000 Equity Shares of EWDPL Five Star Hospitality Private


0.10 0.10 - - -

10,000 Equity Shares of EWDPL Jabalpur Hospitality Private


- 0.10 - - -

10,000 Equity Shares of Skyline Treasure Structural Engineers


- 0.10 - - -

10,000 Equity Shares of Aloha Hospitals Private Limited of


- 0.10 - - -

40,000 Equity Shares of Market City Management Private


- 0.40 - - -

10,000 Equity Shares of Sangli Entertainment World Developers


- 0.10 - - -

In Debentures of Subsidiary Companies :

21,350,000 0% Optionally Fully Convertible Debentures

(previous year Nil) of Nanded Treasure Bazaar Private Limited

of Rs. 10/- each fully paid-up

213.50 - - - -

In Equity Shares of Other than Subsidiary Companies :

390,000 Equity Shares of Naman Mall Management Company


125.50 125.50 125.50 125.50 -

333,333 Equity Shares of Ramayana Realtors Private Limited of


- - 41.67 41.67 -

40,000 Equity Shares of Market City Management Private

Limited

0.40 - - - -

Current Investments: Non-Trade

(Unquoted, at lower of cost and fair value)

9988.65 units of Rs. 1,001.14/- each of Reliance Liquid Fund. - - 10.00 - -

6165.23 units of Rs.10.02/- each of HDFC Cash Management - - 0.06 - -

246


2010 2009 2008 2007 2006

Total 1,301.13 1,088.93 1,113.09 554.71 -

Note:

Aggregate book values:

Quoted Investments - - - - -

Unquoted Investments 1,301.13 1,088.93 1,113.09 554.71 -

Total 1,301.13 1,088.93 1,113.09 554.71 -

247

ANNEXURE XIV

UNCONSOLIDATED SUMMARY STATEMENT OF CURRENT LIABILITIES AND PROVISIONS, AS

RESTATED

Rs. In Million


2009 2009 2008 2007 2006

Current liabilities

Sundry Creditors

Total outstanding dues of Micro Enterprises and Small

Enterprises

- - - - -

Total outstanding dues of creditors other than Micro

Enterprises and Small Enterprises

35.34 70.34 55.29 54.54 39.40

Security Deposits 6.87 8.35 5.52 - -

Over drawn Bank Balances as per books - - 0.01 80.99 66.56

Interest Accrued but not due on Loans - - 0.31 - -

Total 42.21 78.69 61.13 135.53 105.96

Provisions

For Leave Encashment 0.21 1.04 1.46 2.89 0.70

For Gratuity - - 0.82 - -

For Fringe benefits tax 0.07 0.27 0.42 0.07 -

For Wealth tax 0.07 0.06 0.08 0.03 -

Total 0.35 1.37 2.78 2.99 0.70

Grand Total 42.56 80.06 63.91 138.52 106.66

Note: The Company has not received any intimation from the suppliers regarding their status under Micro, Small

and Medium Enterprises Development Act, 2006 and hence the disclosures required under the Act have been given

accordingly.

248

ANNEXURE XV

UNCONSOLIDATED SUMMARY STATEMENT OF INCOME FROM OPERATION AND OTHER

INCOME, AS RESTATED

Rs. In Million

Particulars Nature FOR THE YEARS ENDED MARCH 31,

2010 2009 2008 2007 2006

Income From Operation

Rental Income 177.65 161.01 149.18 141.55 22.55

Common Area Maintenance Charges 38.69 39.99 39.56 35.56 3.50

Recovery of Expenses from tenants 50.09 47.26 50.27 41.25 -

Project Management Fees 0.25 0.09 113.27 90.81 -

Total 266.68 248.35 352.28 309.17 26.05

Other Income

Interest on

Deposits with Bank Recurring 3.82 2.75 2.50 2.77 -

Interest on Income Tax Refund Non-Recurring 2.80 - - - -

Others Non-Recurring 0.60 14.44 3.52 7.63 0.10

Loan to Subsidiary and Associate Companies Non-Recurring 0.01 47.35 - - -

Dividend Received on Current Investments Non-Recurring - 0.06 0.49 3.80 -

Foreign Exchange Gain (Net) Non-Recurring - - 4.10 - -

Profit on Sale of Current Investments ( Net ) Non-Recurring - - 0.06 0.07 -

Sundry Balances Written Back Non-Recurring 3.09 0.53 0.29 0.05 -

Miscellaneous Income Non-Recurring 2.43 1.91 2.79 4.71 -

Total 12.75 67.04 13.75 19.03 0.10

Grand Total 279.43 315.39 366.03 328.20 26.15

249

ANNEXURE XVI

UNCONSOLIDATED SUMMARY STATEMENT OF EMPLOYEE REMUNERATION AND BENEFITS,

AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Salaries, Wages and Bonus 21.67 25.63 91.31 42.52 2.10

(Refer note B 11 of Annexure IV)

Contribution to Provident and Other Fund 0.55 1.72 3.65 0.91 -

Staff Welfare Expenses 0.30 0.68 1.94 0.82 -

Total 22.52 28.03 96.90 44.25 2.10

250

ANNEXURE XVII

UNCONSOLIDATED SUMMARY STATEMENT OF OPERATING AND OTHER EXPENSES, AS

RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Insurance 1.03 1.11 1.98 1.76 -


Travelling and Conveyance Expenses 0.40 0.13 0.23 8.35 0.02


Advertisement and Sales Promotion 2.41 0.31 1.91 10.78 0.03


Brokerage and Commission 0.05 0.17 0.17 1.57 -

Water Expenses 2.78 4.39 1.93 2.02 -

Rent 0.62 0.71 0.12 0.12 -

Repairs and Maintenance - - - - -

-Building 2.37 3.54 2.63 0.36 -

-Plant and Machinery 3.39 1.67 1.92 0.56 -

-Others 2.37 1.89 2.07 0.92 0.03

Power and Fuel 68.37 70.49 77.30 70.02 2.26

Rates and Taxes 6.08 6.78 3.52 3.52 2.58

Legal and Professional Fees 3.45 2.14 4.62 13.87 0.02


Loss on Sale of Fixed Assets 0.78 0.45 0.40 0.07 -

Pre-Payments Charges - - - 9.63

Advances Written off - - - 0.03 -

Preliminary Expenses Written off - - - 0.87

Deferred revenue Expenditure Written off - - - 13.93 -

Balances Written off 1.29 0.26 0.82 - -


Miscellaneous Expenses 1.99 2.67 11.54 11.69 0.97


Foreign Exchange Loss - 22.79 - - -

Total 97.90 120.02 111.16 150.07 5.91

251

ANNEXURE XVIII

UNCONSOLIDATED SUMMARY STATEMENT OF INTEREST, AS RESTATED

Rs. In Million


2010 2009 2008 2007 2006

Interest on:

Term Loans 108.08 110.43 90.01 78.98 -


Others 2.42 3.87 12.01 1.45 -

110.50 114.30 102.02 80.43 -

Less: Capitalised during the year - - 6.71 - -

Total 110.50 114.30 95.31 80.43 -

252

ANNEXURE XIX

UNCONSOLIDATED SUMMARY STATEMENT OF RELATED PARTY DISCLOSURES, AS

RESTATED

Related party disclosures as required by Accounting Standard (AS) 18, "Related Party Disclosures", are

given below:

(i) List of Related Parties

a. Entities having substantial interest in the Company

The Phoenix Mills Limited

Kalani Brothers (Indore) Private Limited.


b. Subsidiary Companies:

Treasure World Developers Private Limited

Nanded Treasure Bazaar Private Limited

Ujjain Treasure Bazaar Private Limited

Udaipur Treasure Market City Private Limited

Gwalior Entertainment World Developers Private Limited

Dazzling Properties Private Limited

Treasure Food & Beverages Private Limited

Treasure MEP Services Private Limited

Marvell Mall Development Company Private Limited

Chandigarh Entertainment World Private Limited

Bhubaneshwar Entertainment World Developers Private Limited

Entertainment World Developers Amritsar Private Limited

Treasure Showcase Private Limited (formerly known as EWDPL Holdings Private

Limited)

EWDPL Residential Holdings Private Limited

Jodhpur Entertainment World Developers Private Limited

EWDPL West Realty Private Limited

Treasure World Constructions Private Limited

Nagpur Treasure Market City Private Limited

EWDPL South Realty Private Limited

EWDPL North Realty Private Limited

Trivandrum Treasure Market City Private Limited

Intesys Technologies Private Limited

Treasure Hospitality Private Limited

Indore Treasure Market City Private Limited

Raipur Treasure Island Private Limited

Chandigarh Treasure Island Private Limited

Jabalpur Treasure Island Private Limited

Indore Treasure Town Private Limited

Pune Entertainment World Developers Private Limited

Nasik Entertainment World Developers Private Limited

Entertainment World Developers Bijalpur Private Limited

Cassandra Realty Private Limited

EWDPL Five Star Hospitality Private Limited

Aloha Hospital Private Limited (formerly known as EWDPL Ujjain Hospitality Private

Limited)

253

EWDPL Chandigarh Hospitality Private Limited

Skyline Treasure Structural Engineers Private Limited

EWDPL Jabalpur Hospitality Private Limited

EWDPL Bhilai Hospitality Private Limited

Sangli Entertainment World Developers Private Limited

Amaravati Treasure Bazaar Private Limited

Annapoorna Entertainment World Developers Private Limited

Wanderland Real Estate Private Limited

Landmark Treasure Town

The Baroda Commercial Corporation Limited

Banglore Entertainment World Developers Private Limited

Ludhiana Entertainment World Private Limited

Kolhapur Entertainment World Developers Private Limited

Arc Retail Private Limited (formerly known as Archisan Design Solutions Private

Limited)

Aashling Entertainment Private Limited

c. Joint Venture

Naman Mall Management Company Private Limited

d. Associate Enterprises

Ramayana Realtors Private Limited

Surya Treasure Island Private Limited

Market City Management Private Limited

Picasso Developers Private Limited

e. Key Management Personnel and their relatives

Mr. Manish Kalani - Managing Director

Mr. B. Rajesh Nair

f. Entities where Key Management person or relative of key management person is having

significant influence:


Flexituff International Limited

Kalani Industries Private Limited

Kalani Brothers (Indore) Private Limited

254

Transactions undertaken/balances outstanding with the related parties:

Rs. In Million

Sr.

No.

PARTICULARS For the Year

ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006

1 Investment in Shares

(including Securities

Premium)

Nanded Treasure Bazaar

Private Limited

- 28.13 - - -


Private Limited

- - 849.91 - -

Kalani Brothers (Indore)

Private Limited

- - - - 86.61

Padma Homes Private

Limited

- - - - 42.22

Jabalpur Treasure Island

Private Limited

- - - 75.34 -


Private Limited

- - - 163.00 -

Indore Treasure Market

City Private Limited

- - - 73.70 -

Others - - 25.55 3.60 -

2 Share Application Money

Paid


Private Limited

- 1.10 - - -

Ujjain Treasure Bazaar

Private Limited

- - 2.75 - -


Private Limited

20.00 - - - -

Others - - 0.10 - -


Refunded

Dazzling Properties Private

Limited

- - 32.50 - -

Ramayana Realtors Private

Limited

- - 54.83 - -


Private Limited

- - 22.50 - -


Limited

- - - - 2.84


Others - - 118.83 - -


Received back


Private Limited

1.10 - - -


Private Limited

- 20.00 - - -

Others 0.10 - - -

5 Security Premium

255

Sr.

No.


ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006

Received

Ruia Real Estate

Development Company

Private Limited

- - 150.85 - -

6 Issue of Shares

Ruia Real Estate

Development Company

Private Limited

- - 18.07 - -

7 Sale of Shares

Gwalior Entertainment

World Developers Private

Limited

1.20 - - - -


Private Limited

- - 0.20 - -


Private Limited

- 43.72 617.53 - -

Others 0.10

8 Purchase of Shares


Private Limited

- - 290.07 - -

Market City Management

Private Limited

- 0.40 - - -

Others - 1.40 - - -


(Pending Allotment)


Private Limited

- 2.75 2.75 2.75 -


Private Limited

- 1.10 - - -

Raipur Treasure Island

Private Limited

- - - 8.10 -

Cassandra Realty Private

Limited

- - - 4.10 -

Udaipur Treasure Market


- - - 46.00 -


Private Limited

- - - 5.10 -

Others - 0.10 - 0.20 -

10 Loans taken


Private Limited

1,014.39 1,691.00 - - -


Limited

- - 137.96 26.48 -


Private Limited

- - 94.80 2.00 -

Padma Homes Private

Limited

- - 42.22 - -

Treasure World


Limited

612.12 307.40 - - -

256

Sr.

No.


ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006

Flexituff International

Limited

- - - 11.32 -


Private Limited

- - - 56.15 -



- - - 147.64 -


Others - 32.61 - - -

11 Loans repaid


Private Limited

1,482.33 1,033.33 - - -

Treasure World


Limited

218.92 307.40 - - -


Limited

- - - 26.48 -


Private Limited

- - - 2.00 -


Limited

- - - 11.32 -


Others 0.73 32.61 - - -

12 Loans given



- - 181.12 180.00 -


Private Limited

- - 58.87 216.18 -


Limited

- - 3.30 84.10 -


Private Limited

- - 1,325.01 - -

EWDPL Residential

Holdings Private Limited

- - 390.25 - -

Amaravati Treasure Bazaar

Private Limited

- 101.85 - - -


Private Limited

439.26 167.48 - - -


Private Limited

81.25 110.21 - - -



- - - 160.25 -

Trivandrum Treasure

Market City Private

Limited

126.00 - - -

Naman Mall Management

Company Private Limited

13.58 - - - -

Others 44.06 111.42 355.97 159.95 -

13 Loan received back

EWDPL Residential


- 292.56 - - -

Treasure World Developers - - 1,106.29 - -

257

Sr.

No.


ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006

Private Limited



- - 291.12 - -


Private Limited

- - 252.04 - -


Private Limited

354.60 118.58 - - -


Private Limited

- - - 66.05 -



- - - 223.75 -

Others 131.68 105.90 504.58 149.88 -

14 Rent Paid (Lease Rent)

Padma Homes Private

Limited

0.03 0.03 0.03 0.01 -


Private Limited

0.08 0.08 - 0.02 -

15 Interest paid


Limited

- 0.94 4.46 - -



Private Limited

0.49 - - - -

16 Interest Received


Private Limited

- 8.83 - - -


Private Limited

- 28.28 - - -


Private Limited

- 10.24 - - -


Private Limited

- - - 1.11 -



- - - 5.02 -

Treasure World


Limited

0.45 - - - -

Others 0.02 - - - -

17 Advance Given


Private Limited

0.63 - - - -

18 Reimbursement of

Expenses from

Subsidiary/Group

Companies


Private Limited

- 11.60 - - -


Private Limited

- - 14.05 - -

Raipur Treasure Island - - 10.73 - -

258

Sr.

No.


ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006

Private Limited


Private Limited

- 14.38 - - -


Private Limited

- - 8.42 - -


Private Limited

13.74 41.47 - - -


Limited

6.90 - - 14.72 14.72

Skyline Advisory Services

Private Limited

- - - - 0.10

MRK Foods - - - - 1.04

Padma Homes Private

Limited

- - - - 1.06

Others 0.30 4.13 35.23 - -

19 Rent Received


Limited

- - 0.06 0.02 -


Limited

- - 0.10 0.03 -

Others 2.75 2.12 0.13 0.02 -

20 Project Management Fees

Received


Private Limited

- - 14.10 28.76 -



- - 11.20 12.62 -


Limited

- - 5.60 12.62 -


Private Limited

- - 10.20 18.45 -

Chandigarh Treasure Island

Private Limited

- - 8.80 - -


Private Limited

- - 23.60 - -



0.25 0.10 1.45 - -

Others - - 38.40 16.17 -

21 Fitout Work


Private Limited

3.12 11.60 - - -

22 License fees and Others

charges Recd.


Limited

- - 10.03 10.59 -

Treasure Food & Beverages

Private Limited

9.93 7.63 - - -

Skyline Advisory Services - - 1.18 - 3.91

259

Sr.

No.


ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006

Private Limited

MRK Foods - - - - 1.04

Others - 0.19

23 Purchase of Goods


Limited

- - - 3.30 2.91

MRK Pipes Limited - - - - 0.55

24 Security Provided by the

Company by way of

Mortgage of Land

Corporate Guarantee

given by Company


Private Limited

1,010.00 1,010.00 900.00 - -



1,250.00 700.00 700.00 100.00 -


Private Limited

740.00 740.00 660.00 - -


Private Limited

360.00 670.00 360.00 - -


Private Limited

455.20 455.20 - - -


Private Limited

700.00 - - - -


Private Limited

390.00 330.00 - - -


private Limited

250.00 250.00 - - -


Private Limited

24.68 24.68 295.16 - -

Chandigarh Treasure Island

Private Limited

1,000.00 - - - -

Treasure World


Limited

1,069.00 - - - -

25 Security deposit received

MRK Foods - - - - 0.16

26 Security deposit paid


Private Limited

- - - - 105.96

Padma Homes Private

Limited

- - - - 44.04

27 Miscellaneous Expenses

Incurred on behalf of

SPVs


Private Limited

- - - 5.33 -

260

Sr.

No.


ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006


Private Limited

- - - 1.88 -

28 Allotment of Debentures


Private Limited

213.50 - - - -

29 Closing Balance :

Receivable / ( Payable)

-As Creditors

Treasure World


Limited

- 0.45 - - -


Private Limited

(2.60) 35.05 - - -


Private Limited

2.33 (3.28) - - -

Marvell Mall Development


- (0.25) - - -


Chandigarh Entertainment

World Private Limited

0.01

Skyline Treasure Structural

Engineers Private Limited

0.02


Private Limited

- (0.10) - - -


Private Limited

(1.12) -


Limited

(0.26) -

-As Unsecured Loans


Private Limited

- - 165.04 - -


Private Limited

44.48 (423.46) 234.22 15.50 -

EWDPL Residential


72.72 97.71 390.25 - -

Treasure World


Limited

(391.49) 2.11 - - -


Private Limited

100.89 89.54 - - -


Private Limited

84.67 213.51 - - -


Private Limited

218.25 142.56 - 51.20 -


Limited

- - - 79.60 -


Private Limited

- - - 22.26 -

261

Sr.

No.


ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006


Private Limited

- - - 193.18 -



- - - 110.00 -


Limited

- (0.73) - - -

EWDPL Five Star

Hospitality Private Limited

0.13 0.11 - - -

EWDPL South Realty

Private Limited

3.76 11.88 - - -

Arc Retail Private Limited - 5.96 - - -

Bhubaneshwar

Entertainment World

Developers Private Limited

- 0.32 - - -

EWDPL Bhilai Hospitality

Private Limited

- 0.10 - - -

EWDPL Chandigarh


- 0.14 - - -

Nagpur Treasure Market


- 1.17 - - -

Treasure MEP Services

Private Limited

- 1.00 - - -

EWDPL Jabalpur


- 0.14 - - -

EWDPL North Realty

Private Limited

- 0.14 - - -

Aloha Hospital Private

Limited

- 0.14 - - -

EWDPL West Realty

Private Limited

- 0.14 - - -

Gwalior Entertainment


Limited

- 0.26 - - -



- 24.21 - - -

The Phoenix Mills Limited (250.00) - - - -

Treasure Showcase Private

Limited

4.92 - - - -


Private Limited

0.50 - - - -

Marvell Mall Development


0.50 - - - -

-As Debtors


Private Limited

0.43 0.08 - - -

Treasure World


Limited

- - - - -

Annapoorna Entertainment


- 0.49 - - -

262

Sr.

No.


ended

March 31,

2010

For the Year

ended

March 31,

2009

For the Year

ended

March 31,

2008

For the

Year ended

March 31,

2007

For the

Year ended

March 31,

2006

Limited


Private Limited

0.02

Nagpur Treasure Market


0.18


Private Limited

0.01

Dazzling Properties Private

Limited

0.02

Sangli Entertainment World


- 0.02 - - -

-As Advances


Private Limited

- - 10.59 - -


Private Limited

- - 14.00 - -


Private Limited

- - 8.41 - -


Private Limited

- - 6.67 - -

Others - - 26.94 - -

-As Share Application

Money


Private Limited

2.75 2.75 - - -


Private Limited

20.00 - - - -

263

ANNEXURE XX

UNCONSOLIDATED CAPITALISATION STATEMENT, AS RESTATED

Rs. In Million

Particulars As at MARCH 31, 2010

Borrowings

Short term 641.49

Long Term debt 1,510.56

Total debt 2,152.05

Shareholders' funds

Share capital 158.46

Share Application Money -

Securities Premium Account 624.82

Profit and Loss Account 101.50

Total shareholders' funds 884.78

Long-term debt/equity ratio 1.71

Total Short term debt/equity ratio 0.73

Notes: 1. Short term debts represent debts which are due within twelve months from March 31, 2010.

2. Long term debts represent debts other than short term debts, as defined above.

3. The figures disclosed above are based on the Summary Statement of Assets and Liabilities, as Restated of

the Company as at March 31, 2010.

4. Long Term Debts/ Equity = Long Term Debts/Shareholders' Funds

5. Post Issue figure will be determined only after finalization of the issue price.

6. Vide Resolution passed at the Shareholders Meeting held on July 20, 2006, the Company has sub-divided

each share of Rs. 100/- each into 10 shares of Rs.10/- each.

7. Vide Resolution passed at the meeting of the Board of Directors held on June 11, 2010, the company issued

47,217,888 Equity Shares as Bonus Shares by capitalisation of general reserves and securities premium

account.

264

ANNEXURE XXI

UNCONSOLIDATED SUMMARY STATEMENT OF ACCOUNTING RATIOS, AS RESTATED


2010 2009 2008 2007 2006

1) Restated Basic Earnings per share Rs. 0.23 0.29 0.48 0.87 (0.23)

2) Restated Diluted Earnings per share Rs. 0.16 0.20 0.36 0.78 (0.23)

3) Restated net asset value per share Rs. 14.05 15.37 27.95 12.14 5.76

4) Return on Net Worth (%) 1.67% 1.88% 1.73% 7.21% -3.92%

5) (a) No. of Shares* 15,739,296 15,739,296 15,739,296 15,000,000 10,175,800

(b) Weighted Average no. of shares*

- for Basic Earnings per share 15,739,296 15,739,296 14,740,718 11,752,988 10,175,800

- for Bonus Shares 47,217,888 47,217,888 47,217,888 47,217,888 47,217,888

- for Diluted Earnings per share 43,616,312 43,616,312 36,100,366 19,110,045 11,366,737

* Equity shares of Rs.10 Each

Notes:

1) The ratios have been computed as follows:

Earning per Share - Basic and Diluted = Adjusted Profit / (Loss) after Tax but before Extraordinary

Items

Weighted average number of equity shares outstanding during

the year

Net Asset Value per Share = Net Worth excluding Revaluation Reserve

Weighted Average Number of Equity Shares Outstanding

during the year

Return on Net Worth = Adjusted Profit / (Loss) after Tax but before Extraordinary

Items

Net Worth excluding Revaluation Reserve

2) Earnings per share (EPS) has been calculated in accordance with Accounting Standard 20 - Earnings Per

Share.

3) Restated profit / (loss) has been considered for the purpose of computing the above ratios.

4) Vide Resolution passed at the meeting of the Board of Directors held on June 11, 2010, the company issued

47,217,888 Equity Shares as Bonus Shares by capitalisation of general reserves and securities premium

account.

5) 1,067,300 equity shares of Rs 10/- each were forfeited during the year ended March 31, 2008.

6) Vide Resolution passed at the Shareholders Meeting held on July 20, 2006, the Company has sub-divided

each share of Rs. 100/- each into 10 shares of Rs.10/- each.

265

ANNEXURE XXII

UNCONSOLIDATED SUMMARY STATEMENT OF TAX SHELTERS, AS RESTATED

Rs. In Million

PARTICULARS As At March 31

2010 2009 2008 2007 2006

(Loss)/Profit before tax as restated A 17.85 19.06 33.83 54.17 (11.80)

Tax rate % (including surcharge and cess, as

applicable)

B 30.90% 30.90% 33.99% 33.66% 33.66%

Tax at notional rate C=A*B 5.52 5.89 11.50 18.23 (3.97)

Adjustments:

Permanent Differences

Penalty - 2.22 - - -

Deductions U/S 24 (a) (51.56) (47.14) (43.70) (41.41) (4.94)

Deductions U/S 24 (b) (9.68) (9.68) (14.87) (8.21) (8.21)

Others 0.50 (0.36) (4.86) 8.69 -

Total D (60.74) (54.96) (63.43) (40.93) (13.15)

Timing Difference :

Tax depreciation and book value depreciation (7.07) 3.47 (0.61) (1.75) (9.98)

Others 1.43 1.91 2.66 5.98 (3.46)

Total E (5.64) 5.38 2.05 4.23 (13.44)

Net Adjustments F=D+E (66.38) (49.58) (61.38) (36.70) (26.59)

Tax Expenses / (Saving) Thereon G=F*B (20.51) (15.32) (20.86) (12.35) (8.95)

Net Tax Expenses / (Saving) Thereon H=C+G (15.00) (9.43) (9.36) 5.88 (12.92)

Taxable Income / (Loss) I=A+F (48.53) (30.52) (27.55) 17.47 (38.39)

NOTES: 1) The above working is based on the summary statement of profit and loss, as restated for the respective years.

266

MANAGEMENT‟S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF

OPERATION

The following discussion and analysis of our financial condition and results of operations is based on and should be

read in conjunction with our audited consolidated financial statements as of and for the financial years ended

March 31, 2010, 2009, 2008, 2007 and 2006, including the schedules and notes thereto, and the report thereon,

which appear elsewhere in this Draft Red Herring Prospectus. These financial statements are based on our audited

consolidated financial statements and are restated in accordance with paragraph B(1) of Part II of Schedule II of

the Companies Act and the SEBI Regulations. Our audited consolidated financial statements are prepared in

accordance with Indian GAAP. Our financial year ends on March 31 of each year. Accordingly, all references to a

particular financial year are to the twelve month period ended March 31 of that year.

The following discussion and analysis contains forward-looking statements that involve risks and uncertainties. For

additional information regarding such risks and uncertainties, see “Forward-Looking Statements” and “Risk

Factors” on pages x and xi respectively of this Draft Red Herring Prospectus.

Overview




































267




































Treasure

Market

City

Treasure

Island

Treasure

Bazaar

Treasure Town

and Vihar

Total

Completed Projects




0.65

0.86 - 1.51



0.45

0.58 - 1.03

Ongoing Projects




3.00

3.21

1.03 11.03 18.27

Total Leasable/Saleable Area 11.03 16.14

268

Treasure

Market

City

Treasure

Island

Treasure

Bazaar

Treasure Town

and Vihar

Total

(million square feet) 2.02 2.32 0.77





0.87

- 4.19 5.06



0.75

- 4.19 4.94

Grand Total




3.00

4.73

1.89 15.22 24.84



2.02

3.52

1.35 15.22 22.11











Significant Factors Affecting Our Results of Operations

Our results of operations and financial condition are affected by a number of factors, including the following, which

are of particular importance:

Volume of developed property and its development cycle

Historically, we derived substantially all of our income from rental income from our properties and our results of

operations are dependent on the amount and area of developed properties we lease in any financial period. As of

March 31, 2010, we had 1.03 million square feet of Leasable Area from our completed projects. We derived in the

financial years 2010, 2009 and 2008, Rs.230.35 million (includes our share of rental income from our joint venture

project, Treasure Central- Indore (Treasure Bazaar), which was Rs.50.35 million for the financial year 2010),

Rs.158.94 million and Rs.149.05 million, respectively, of rental income.

We also sell units within our residential projects and our results of operations vary significantly from period to

period due to the amount of property sold in such periods. For the financial year 2010 we derived Rs.498.68 million

of income from the sale of construction properties as compared to nil for the financial year 2009.

In addition, developments in the real estate sector are driven by:

demand for more housing units in cities and towns due to the growing urbanization of the Indian populace,

an expanding middle class, disposable income, trend towards nuclear families and the availability of

housing finance and tax incentives;

demand for shopping centers and entertainment venues;

269

demand for hotels/resorts due to business travel and tourism; and

the development of infrastructure, including roads, airports and intra-city connectivity.

Our revenue sharing arrangements in leasing our retail and hospitality properties

We typically enter into three types of lease arrangements with our tenants for our retail properties, fixed-price leases,

fixed-or-percentage of sales leases and percentage of sales leases.

Retail

Fixed-price lease. In a typical fixed price lease, a tenant pays rent at a specified price, monthly, for a fixed duration.

The rent a tenant pays is derived from a combination of assessing the prevailing market lease rates of the shopping

center‟s location along with an assessment of the tenant‟s ability to pay the proposed rental rates. All our fixed price

leases are subject to an industry standard escalation rental increase clause at pre-determined intervals during the

term of the lease.

Fixed-or-percentage of sales lease. A fixed-or-percentage of sales lease, is an arrangement whereby a tenant pays a

base rental fee or additional rental fee based on a percentage of its sales (whichever is higher); this percentage is

calculated from the sales made by a tenant from its leased space in our shopping center, at the end of each month of

the lease period. The base rent is typically arrived at by taking into account the ongoing market lease rate for the

space which a tenant intends to occupy and its brand (which is determined by assessing its gross margins,

operational expenditure and capital expenditure levels). For example, if a tenant‟s percentage of sales paid as rental

fees is high, the tenant will typically receive a larger discount on its base rent. If a tenant pays a low percentage of its

sales as rental fees, its base rent will typically be higher.

Percentage of sales lease. The rental fee paid to us under percentage of sales leases are based entirely on the tenant‟s

sales, which is calculated from the sales made by the tenant on its leased space, at the end of each month of the lease

period. This percentage is typically arrived at by analyzing the tenant‟s business category (which is determined by

the sales volume and margin structure of a tenant), the tenant‟s brand (which is determined by assessing its gross

margins, operational expenditure and capital expenditure levels) and the tenant‟s trading density (which is

determined by the ability of the tenant to absorb our rental rates).

As of March 31, 2010, approximately 68.00% of our tenants were on fixed-price leases. The trend in the Indian

retail industry over the past year has been to move towards fixed-or-percentage of sales leases and percentage of

sales leases, which we expect to continue. Over the long term, we expect that the level of retail property tenant sales

will become the most important determinant of revenues of a retail property because a tenant‟s retail sales will

determine the amount of rent, percentage of rent and recoverable expenses (together, the “total occupancy costs”)

that shopping center tenants will be able to afford to pay.

Hospitality Properties Lease Structure

We typically enter into fixed-plus-percentage of sales leases for a period of approximately 29 years with our

hospitality tenants for the hotels we develop. The hotel operator pays a base rental fee for the hotel and additional

rental fee based upon a percentage of its sales (usually limited to a specific segment of the hotel‟s business, such as

food and beverage); this percentage is calculated from the sales made by the hotel, at the end of each month of the

lease period. Furthermore, in certain circumstances, if the hotel achieves a certain revenue threshold from its

occupancy rate, we are entitled to receive 35.00% of the incremental revenue achieved over and above the threshold

level. The base rent is typically arrived at by taking into account the ongoing market lease rate for the hotel. The

percentage of sales we negotiate as a rental fee on fixed-plus-percentage of lease arrangements varies between hotel

operators and depends on various factors including the hotel operator‟s business model and brand.

Our financial performance is influenced by conditions in the retail business and the hospitality business in India and

the cities in which we operate and could, in the future be, affected by:

270

cyclical downturns arising from changes in general and local economic conditions;

periodic oversupply of retail properties and/or hotel rooms;

the recurring need for renovation, refurbishment and improvement of the properties;

increases in interest rates and inflation;

the adverse financial condition of some large retail and/or hospitality companies;

changes in wages, prices, energy costs and construction and maintenance costs that may result from

inflation, government regulations, changes in interest rates or currency fluctuations;

consolidation of retail or hotel operators in the retail or hospitality sectors;

changes in consumer spending patterns;

changes in consumer preference in relation to property design and interior decoration or location;

unemployment levels;

an increase in consumer purchases from mail-order or internet purchases and consequent reduction for

retail;

competition from warehouse and outlet stores and competitors with new business models;

transportation infrastructure developments in new areas;

decreases in the demand for hotel rooms and related lodging services, including a reduction in business

travel as a result of general economic conditions;

extreme weather conditions or acts of terrorism;

any changes in taxation and zoning laws; and

adverse government regulation.

General Economic and Demographic Condition in India

All our operations are currently located in India and the economic condition in India has a direct impact on our

income. In the past, India experienced rapid economic growth, with GDP growing at an average growth rate of 8.8%

between the financial years 2003 to 2008. However, this high GDP growth trajectory significantly reduced in the

financial year 2009 to 6.7%, compared to 9.0% in the financial year 2008, as a result of the global economic

downturn. (Source: RBI, Macroeconomic and Monetary Developments: First Quarter Review, 2009-10). The

success of our projects is dependant on general economic conditions in India. Growth in the GDP and per capita

income in India generally results in an increase in our income. In addition, the growth in the Indian economy has

also resulted in the growth of industries such as hospitality and information technology. We believe that growth in

the general economic condition in India will not only increase the demand for more houses for those employed in

these industries but will also require substantial real estate development activities, such as building of office space,

IT parks, hotels and resorts and shopping-centers.

271

Condition and Performance of the Real Estate Market of India

The economic condition of India, particularly in and around emerging cities, has a direct impact on our income and

the success of our developments is dependent on the general economic conditions in India. Growth in the GDP and

per capita income of the Indian population generally results in increased demand for retail and entertainment,

commercial, hospitality and other properties. The real estate development industry has shown an increase in demand

for all types of developments, including housing, information technology parks, hotels, serviced residences, resorts

and shopping centers, and rising disposable incomes in the middle and higher income groups have historically

resulted in an increase in demand for higher quality retail space, as well as improved residential housing.

However, the real estate development industry recently underwent a significant downturn due to the global

economic slowdown and increase in the interest rates, among other factors. The global credit markets and financial

services industry have experienced a period of upheaval characterized by the bankruptcy, failure, collapse or sale of

various financial institutions, severely diminished liquidity and credit availability, declines in consumer confidence,

declines in economic growth, increases in unemployment rates, uncertainty about economic stability and an

unprecedented intervention by governments and monetary authorities. While the global markets have shown signs of

recovery, we are unable to predict whether the current upward trend will be sustained. The ultimate outcome of

these events cannot be predicted and it may have an adverse effect on our ability to borrow or raise additional funds

in the capital markets on favorable terms, which may have an adverse effect on our operations, financial condition

and results of operation.

Cost of land and construction

Our Ongoing Projects and Forthcoming Projects will require us to incur significant costs for their development. See

“Management‟s Discussion and Analysis of Financial Condition and Results of Operations – Financial Condition,

Liquidity and Capital Resources – Capital Expenditures” on page 283 of this Draft Red Herring Prospectus for our

capital expenditures for the past three financial years. In addition, as we hold or intend to hold equity interests in

other Treasure Market City, Treasure Island, and Treasure Town and Treasure Vihar projects through project-

specific companies, our profitability will be affected by the construction and land costs incurred by these entities.

Our growth is directly linked to the availability of land in fast growing and emerging cities in India in areas where

we can develop properties that are marketable and meet our development criteria. Any government regulations,

policies or other developments that restrict the acquisition of land or increase competition for land may therefore

affect our operations.

The cost of construction primarily comprises costs of materials such as steel, cement, wood, flooring materials,

electrical, plumbing and labor costs. Any shortages in supply and volatility in prices of building materials could

arise from changes in import restrictions, such as changes to customs duties and licensing policies, applicable to

goods (such as certain building materials) imported into India. In addition, our supply chain may be periodically

interrupted by circumstances beyond our control, including work stoppages and labor disputes affecting our

suppliers, their distributors, or the transporters of our supplies. During periods of shortages in building materials,

such as cement and steel, we may not be able to complete projects according to our previously established timelines,

at our previously estimated project cost, or at all, which could affect our results of operations and financial

condition. In addition, during periods of volatility in the price of building materials, where prices have increased

significantly or unexpectedly, we may not be able to pass the increase in construction costs through to our

customers, particularly as we generally aim to pre-sell a significant portion of our residential units prior to project

completion, which could reduce or eliminate the profits we attain with regards to our residential developments.

Availability of Credit and Prevailing Interest Rates in India

Our results of operations and the purchasing power of our real estate and retail customers are substantially affected

by prevailing interest rates and the availability of credit in the Indian economy. We finance each of our real estate

projects, primarily through borrowings from Indian banks which we repay during the development of each project.

Based on our restated consolidated financial statements, as of March 31, 2010, we had outstanding secured and

unsecured loans of Rs.5,065.61 million and Rs.4,059.91 million, respectively. Recent changes in the global and

Indian credit and financial markets have led to, and events similar to this may lead to, significantly diminished

availability of credit and an increase in the cost of financing. Our ability to borrow funds for the development of our

272

real estate projects is also affected by the prevailing interest rates available from leading Indian banks. Changes in

the prevailing interest rates affect our interest expense in respect of our borrowings and our interest income with

respect to our interest on short-term deposits with banks and loans to associates. The interest rate at which we may

borrow funds and the availability of capital for development purposes affects our results of operations by limiting or

facilitating the number of projects we may undertake and determining the return which we must obtain from each

project to meet our obligations under our borrowings.

One of the major reasons for the growth of demand for housing units is low interest rates on housing loans. Changes

in interest rates also affect the ability and willingness of our prospective real estate customers, particularly, the

customers for our residential properties to obtain financing for their purchases of our completed developments. In

the past, lower interest rates combined with the favorable tax treatment of loans, helped to fuel the growth of the

Indian real estate market. The interest rate at which our real estate customers may borrow funds for the purchase of

our properties affects the affordability and purchasing power of and hence, the market demand for our residential

real estate developments.

Significant Accounting Policies

Our audited consolidated financial statements included in this Draft Red Herring Prospectus have been prepared in

accordance with Indian GAAP, the accounting standards prescribed by the Institute of Chartered Accountants of

India and the relevant provisions of the Companies Act. Certain significant accounting policies that are relevant to

our business and operations are described below.

Basis of Preparation

The following discussion and analysis is based on the audited consolidated financial statements of our Company

which have been prepared in accordance with Indian GAAP. Indian GAAP differs in certain material respects with

IFRS and U.S. GAAP. See “Risk Factors – Risks Related to India – Significant differences exist between Indian

GAAP and other accounting principles with which investors may be more familiar” on page xxxix of this Draft Red

Herring Prospectus. As far as possible, the consolidated financial statements are prepared using uniform accounting

policies for like transactions and other events in similar circumstances and are presented in the same manner as the

Company‟s separate financial statements.

Principles of Consolidation

The consolidated financial statements relate to the Company, its Subsidiaries and Joint Venture and have been

prepared in accordance with Accounting Standard 21 – „Consolidated Financial Statements‟, Accounting Standard

23 – „Accounting for Investment in Associates in Consolidated Financial Statements‟ and Accounting Standard 27 –

„Financial Reporting of Interests in Joint Ventures‟ notified under the Companies (Accounting Standards) Rules,

2006.

Our consolidated financial statements have been prepared on the following basis:

Investments in Subsidiaries:

Our Subsidiaries are consolidated on a line-by-line basis by adding together the book values of the same

items of assets, liabilities, income and expenses, after eliminating all significant intra-group balances and

intra-group transactions and also unrealized profits or losses.

The difference between the costs of investment in the Subsidiaries over the Company‟s portion of equity of

the Subsidiary is recognized in the financial statements as „goodwill‟ or „capital reserve‟.

The difference between the proceeds from the disposal of an investment in a Subsidiary and the carrying

amount of its assets, less liabilities, as of date of such disposal is recognized in the profit and loss account

as profit or loss on disposal of investment in a Subsidiary.

273

Minority interest in the net assets of the Subsidiaries consists of the amount of equity attributable to the

minority shareholders at the dates on which investments are made in such Subsidiaries and further

movements in their share in the equity, subsequent to the dates of investments. Minority interest also

includes share application money received from minority shareholders. The losses in Subsidiaries

attributable to the minority shareholder are recognized to the extent of their interest in the equity of the

Subsidiaries.

Investment in Associates:

Investments in Associates where the Company has significant influence and which is neither a Subsidiary

nor a joint venture, are accounted for using the equity method in accordance with Accounting Standard 23

– „Accounting for Investment in Associates in Consolidated Financial Statements‟.

The Company accounts for its share in the change in the net assets of the Associates, post acquisition, after

eliminating unrealized profits and losses resulting from transactions between the Company and its

Associates to the extent of its share, through its profit and loss account to the extent such change is

attributable to the Associates‟ profit and loss account and through its reserves for the balance, based on

available information.

The difference between the costs of investment in the Associates over the Company‟s share of equity of the

Associate is recognized in the financial statements as „goodwill‟ or „capital reserve‟, as the case may be.

Investment in joint venture:

Our interest in a joint venture, which is in the nature of a jointly controlled entity, is accounted for using the

proportionate consolidation method.

Revenue Recognition

Rental income, common area maintenance charges and project management fees are recognized when no

significant uncertainty as to collectability or realisability exists.

Sales are inclusive of value added tax (“VAT”).

Revenue from constructed or under construction property is recognized on the “percentage of completion

method”. Total sale consideration as per the agreement to sell entered into is recognized as revenue on the

basis of percentage of actual project cost incurred thereon to total estimated project cost. Project cost

includes cost of land, estimated construction and development costs. The estimates of saleable area and

costs are reviewed on a periodic basis and the effect of any change in such estimates is recognized in the

period such changes are determined. Future expected loss, if any, is recognized as an expense.

Interest income is recognized on a time proportion basis.

Dividend income is recognized when the right to receive the same is established.

Fixed Assets

Fixed Assets are stated at cost net of recoverable CENVAT and rebates.

Costs include finance costs till the completion of construction and costs that are directly attributable.

Expenses incidental and related to project prior to completion of construction are included in capital work-

in-progress. The same will be allocated on the completion of the project.

274

Inventories

Items of inventories are valued at the lower of cost and net realizable value. Cost of inventories comprises cost of

land, work in progress and other costs incurred in bringing the inventory to its present location and condition.

Depreciation

Depreciation is provided on a straight-line basis at the rate and in manner specified in Schedule XIV of the

Companies Act except in case of certain categories of plant and machinery and office equipment, which are

depreciated at 13.91% based on the management‟s estimate of useful life of such assets. Depreciation on assets

acquired during the period is provided on pro-rata basis with reference to the month of addition.

Leases

Assets given on lease are accounted for in accordance with Accounting Standard 19 – „Leases‟. Assets given on

operating leases are included in fixed assets. Lease income is recognized in the profit and loss account. Leasehold

land is amortized over the period of the lease.

Borrowing costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of

the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its

intended use or sale. All other borrowing costs are charged to revenue.

Income Taxes

Tax expense comprises current tax, deferred tax and fringe benefits tax. Current tax is measured at the amount

expected to be paid to or recovered from tax authorities using the applicable tax rates. Deferred income tax reflect

the current period timing differences between taxable income and accounting income for the period and reversal of

timing differences of earlier years or periods. Deferred tax assets are recognized only to the extent that there is

reasonable certainty that sufficient future income will be available except that deferred tax assets, in case there are

unabsorbed depreciation and losses, are recognized if there is virtual certainty that sufficient future taxable income

will be available to realize such depreciation and losses. Fringe benefits tax is recognized in accordance with the

relevant provisions of the Income Tax Act, 1961 and the Guidance Note on Fringe benefits Tax issued by the

Institute of Chartered Accountants of India.

Results of Operations

The following table sets forth select financial data from our consolidated restated profit and loss statement for the

financial years 2010, 2009, 2008, 2007 and 2006 the components of which are also expressed as a percentage of

total income for such periods:

Particulars For the Year Ended March 31,

(Rs. in million)

2010 % of

Total

Income

2009 % of

Total

Income

2008 % of

Total

Income

2007 % of

Total

Income

2006 % of

Total

Income

INCOME

Income From

Operations…………….

1,020.01 96.02 389.09 91.84 265.32 94.06 218.36 94.29 26.05 99.62

Other Income ……….. 42.33 3.98 34.59 8.16 16.75 5.94 13.23 5.71 0.10 0.38

Total Income 1,062.34 100.00 423.68 100.00 282.07 100.00 231.59 100.00 26.15 100.00

EXPENDITURE

Construction

Expenses

268.93 25.31 29.65 7.00 - - - - - -

Operating and Other

Expenses

276.32 26.01 193.65 45.71 142.68 50.58 113.26 48.90 5.91 22.60

Employee Remuneration 93.41 8.79 58.47 13.80 41.34 14.66 18.48 7.98 2.10 8.03

275

Particulars For the Year Ended March 31,

(Rs. in million)

2010 % of

Total

Income

2009 % of

Total

Income

2008 % of

Total

Income

2007 % of

Total

Income

2006 % of

Total

Income

and Benefits

Interest 199.19 18.75 207.41 48.95 86.74 30.75 78.98 34.10 - -

Depreciation/

Amortization

46.23 4.35 52.72 12.44 41.51 14.72 36.08 15.58 8.60 32.88

Total Expenditure 884.08 83.22 541.90 127.90 312.27 110.71 246.80 106.56 16.61 63.51

Profit/ (loss) before tax 178.26 16.78 (118.22) (27.90) (30.20) (10.71) (15.21) (6.56) 9.54 36.49

PROVISION FOR

TAX:

Current Tax 27.18 2.55 29.83 7.04 2.49 0.88 1.55 0.66 0.80 3.05

Deferred Tax 2.85 0.27 1.77 0.42 - - - - - -

Wealth Tax 0.08 0.01 0.04 0.01 0.05 0.02 0.03 0.01 - -

Fringe Benefits

Tax

- - 1.64 0.39 1.73 0.61 1.00 0.43 0.35 1.33

Net Profit / (Loss)

Before Minority Interest

and Share from

Associates

148.15 13.94 (151.50) (35.75) (34.47) (12.22) (17.79) (7.68) 8.39 32.09

Share of loss from

Associates

0.16 0.02 (0.05) (0.01) (0.10) (0.04) - - - -

Minority Interest 22.25 2.09 12.99 3.07 (2.07) (0.73) (0.01) (0.00) - -

Net Profit / (Loss) After

Minority Interest and

Share from Associates

125.74 11.83 (164.54) (38.83) (32.50) (11.52) (17.78) (7.67) 8.39 32.09


- - 35.68 8.42 12.59 4.46 36.78 15.88 (21.34) (81.60)

Net Profit / (Loss) After

Minority Interest and

Share from Associates,

as Restated

125.74 11.83 (128.86) (30.41) (19.91) (7.05) 19.00 8.20 (12.95) (49.52)

Income. Income consists of income from operations and other income.

Our income from operations consists primarily of rental income from the lease of properties, and income from the

sale of construction properties, income from project management fees that we generate by providing project

management services to third parties, income from food and beverages from our shopping centers, recovery of

expenses which comprises recovering electricity and water charges from our tenants at our Treasure Island – Indore

shopping center, construction income which comprises income from providing services such as architectural

services and interior design services and common area maintenance charges for our shopping centers.

The table below provides our income and percentage of total income from rental income and sale of construction

properties for the periods indicated:

For the Year Ended March 31,

(Rs. in million) 2010 2009 2008 2007 2006

Activity (Rs. in

million)

% of

Total

Income

(Rs. in

million)

% of

Total

Income

(Rs. in

million)

% of

Total

Income

(Rs. in

million)

% of

Total

Income

(Rs. In

million)

% of

Total

Income

Rental

Income...

230.351 21.68 158.94 37.51 149.05 52.84 141.56 61.13 22.55 86.23

Sale of

Construction Properties...

498.68 46.94 - - - - - - - -

Total…. 729.03 68.62 158.94 37.51 149.05 52.84 141.56 61.13 22.55 86.23

__________

1. Includes our share of rental income generated from our joint venture project, Treasure Central - Indore (Treasure Bazaar), which was Rs.50.35

million for the financial year 2010.

276

Other income consists primarily of interest received from deposits with banks and others, dividend received on

current investments, sale of land, income from hiring our plant and machinery and miscellaneous income.

Our total income was Rs.1,062.34 million for the financial year 2010 as compared to Rs.423.68 million for the

financial year 2009 and Rs.282.07 million for the financial year 2008.

Expenditure. Our total expenditure consists of construction expenses; employee remuneration and benefits;

operating and operating and other expenses which includes general and administrative charges, advertising and sales

promotion, purchases of food and consumable items, power and fuel costs and legal fees; interest and finance

charges and depreciation and amortization. Our total expenditure accounted for 83.22% of our total income for the

financial year 2010 as compared to 127.90% of our total income for the financial year 2009.

Construction Expenses. Construction expenses consist of costs of construction material and costs of land.

Construction expenses accounted for 25.31% of our total income for the financial year 2010 as compared to 7.00%

for the financial year 2009.

Operating and Other Expenses. Operating and other expenses includes general and administrative charges,

advertising and sales promotion, purchases of food and consumable items, power and fuel costs and legal fees.

Operating and other expenses accounted for 26.01% of our total income for the financial year 2010 as compared to

45.71% of our total income for the financial year 2009.

Employee Remuneration and Benefits. Employee remuneration and benefits consists of salaries, wages and

bonuses paid to our officers and employees, contributions to provident and other funds for the benefit of our officers

and employees and other staff welfare expenses. Staff cost does not include the costs of labour, architects or

consultants, which are allocable to specific developments and are provided for under cost of sales. Employee

remuneration and benefits costs accounted for 8.79% of our total income for the financial year 2010 as compared to

13.80% of our total income for the financial year 2009.

Interest. Interest consists of interest paid on outstanding debentures, term loans and other loans obtained from

banks, financial institutions and other lenders, as well as the related processing charges. Interest includes the effect

of interest received from deposits. Interest charges accounted for 18.75% of our total income for the financial year

2010 as compared to 48.95% of our total income for the financial year 2009. See “Financial Condition, Liquidity

and Capital Resources – Indebtedness” on page 283 of this Draft Red Herring Prospectus for a description of our

Indebtedness.

Depreciation / Amortization. Depreciation / amortization is provided on straight line basis in accordance with the

rates specified under Schedule XIV of the Companies Act, except for certain categories of office equipment which

are depreciated based on the basis of the management‟s estimate of the useful life of such assets.

The following table provides the depreciation rates for our tangible assets as of March 31, 2010:

Assets Annual Depreciation Rate

Building 1.63%

Plant and machinery 13.91%

Office equipments 13.91%

Furniture and fixtures 6.33%

Vehicles 9.50%

Computers 16.21%

Software 16.21%

Leasehold land Over the lease period

The management‟s estimation of the useful lives of certain assets are as follows:

Type of Assets Estimated Useful Life (In Years)

Electrical installations/ generators/ transformers 15

277

Central cooling equipment 15

Office equipment 7

Taxation. We provide for both current taxes, and deferred taxes, wealth tax and fringe benefits tax. Current tax is

measured at the amount expected to be paid to or recovered from tax authorities using the applicable tax rates.

Deferred income tax reflect the current period timing differences between taxable income and accounting income for

the period and reversal of timing differences of earlier years or period. Deferred tax assets are recognized only to the

extent that there is reasonable certainty that sufficient future income will be available except that deferred tax assets,

in case there are unabsorbed depreciation and losses, are recognized if there is virtual certainty that sufficient future

taxable income will be available to realize the same. Fringe benefits tax is recognized in accordance with the

relevant provisions of the Income-tax Act, 1961 and the Guidance Note on Fringe benefits tax issued by the Institute

of Chartered Accountants of India.

Tax rates applicable to us for the financial year 2010 are as follows:

Rate of Tax Percentage

Income Tax 30.00%

Surcharge on Tax 10.00%

Education Cess on Rate of Tax and Surcharge 2.00%

Secondary and Higher Education Cess on Rate

of Tax and Surcharge

1.00%

Total Tax Rate 33.90%

For a summary of tax benefits available to us, see “Statement of Tax Benefits” on page 48 of this Draft Red Herring

Prospectus.

Financial Year 2010 Compared to Financial year 2009

Income. Our total income increased to Rs.1,062.34 million for the financial year 2010 from Rs.423.68 million for

the financial year 2009, primarily due to an increase in income from operations as a result of the sale of residential

property.

Income from Operations. Our income from operations increased to Rs.1,020.01 million for the financial year 2010

from Rs.389.09 million for the financial year 2009. This increase was primarily due to income generated from the

sale of construction properties, which comprises sales of residential property, of Rs.498.68 million for the financial

year 2010 from nil for the financial year 2009. The increase was as a result of the sale of residential units in our

Treasure Town and Treasure Vihar project in Indore (at AB Road and Rangwasa) and Treasure Town and Treasure

Vihar in Udaipur (at Kharol Colony). Our income from operations also increased due to an increase in rental income

by 13.25% to Rs.180.00 million for the financial year 2010 from Rs.158.94 million for the financial year 2009 as a

result of increased rental income from Treasure Island – Indore shopping center and Treasure Bazaar – Nanded

shopping centre, income of Rs.50.35 million for the 11 month period ended March 31, 2010 from Treasure Central -

Indore (Treasure Bazaar) shopping center, a joint venture, which was completed in May 2009, an increase in project

management fees to Rs.64.85 million for the financial year 2010 from Rs.7.78 million for the financial year 2009 as

a result of an increase in third party clients for the financial year 2010 from the financial year 2009, an increase in

income from food and beverages of 13.00% to Rs.63.80 million for the financial year 2010 from Rs.56.46 million

for the financial year 2009 as a result of Treasure Bazaar - Nanded shopping centre commencing its food and

beverage services during the financial year 2010 compared to only Treasure Island - Indore generating income from

food and beverages for the financial year 2009, an increase in the recovery of expenses by 14.04% to Rs.53.90

million for the financial year 2010 from Rs.47.26 million for the financial year 2009 and an increase in common

area maintenance charges by 0.65% to Rs.40.25 million for the financial year 2010 from Rs.39.99 million for the

financial year 2009. This increase in operating income was offset by a decrease in income from construction

activities by 44.72% to Rs.43.48 million for the financial year 2010 from Rs.78.66 million for the financial year

2009.

278

Other Income. Our other income increased by 22.37% to Rs.42.33 million for the financial year 2010 from Rs.34.59

million for the financial year 2009, primarily due to recognizing a one time profit of Rs.20.29 million for the

financial year 2010 as a result of the sale of 17 of our subsidiaries which were shell companies, an increase in

miscellaneous income of 7.49% to Rs.5.14 million from Rs.4.79 million, an increase in sundry balances written back

to Rs.3.13 million for the financial year 2010 from Rs.0.53 million for the financial year 2009 which was off-set by

decreases in interest received from bank deposits of 31.21% to Rs.6.48 million for the financial year 2010 from

Rs.9.43 million and decreases in interest received on others by 71.03% to Rs.4.20 million for the financial year 2010

from Rs.14.50 million for the financial year 2009.

Total Expenditure. Our total expenditure increased by 63.14% to Rs.884.08 million for the financial year 2010 from

Rs.541.90 million for the financial year 2009, primarily due to an increase in construction expenses, operating and

other expenses and employee remuneration and benefits.

Construction Expenses. Our construction expenses increased to Rs.268.93 million for the financial year 2010 from

Rs.29.65 million for the financial year 2009, primarily due to an increase in the cost of land and development to

Rs.233.81 million for the financial year 2010 from Rs.1.65 million for the financial year 2009 as a result of an

increase in construction activity at our Treasure Town and Treasure Vihar - Indore (AB Road) residential project.

Operating and Other Expenses. Our total operating expenses increased by 42.68% to Rs.276.32 million for the

financial year 2010 from Rs.193.65 million for the financial year 2009 primarily due to an increase in general and

administrative charges to Rs.16.80 million for the financial year 2010 from Rs.4.28 million for the financial year

2009, an increase in advertisement and sales promotion to Rs.33.31 million for the financial year 2010 from Rs.8.16

million for the financial year 2009 as a result in an increase in advertising activity for the two Treasure Towns and

Treasure Vihars in Indore (AB Road and Rangwasa) and Treasure Town and Treasure Vihar in Udaipur, an increase

in purchases of food and beverages of 21.32% to Rs.25.37 million for the financial year 2010 from Rs.20.91 million

for the financial year 2009, an increase in power and fuel charges by 3.02% to Rs.79.25 million for the financial

year 2010 from Rs.76.92 million for the financial year 2009, an increase in legal and professional fees to Rs.35.92

million for the financial year 2010 from Rs.8.09 million for the financial year 2009 as a result of launching our

residential projects, and as a result in incurring share in a joint venture, which was our contribution for the operation

of our joint venture project Treasure Central – Indore, of Rs.32.00 million for the financial year 2010 from nil for

the financial year 2009.

Employee Remuneration and Benefits. Employee remuneration and benefits increased by 59.75% to Rs.93.41

million for the financial year 2010 from Rs.58.47 million for the financial year 2009, primarily due to an increase in

salaries, wages and bonus by 61.60% to Rs.90.40 million for the financial year 2010 from Rs.55.94 million for the

financial year 2009 as a result of an increase in the number of our employees from 606 as of March 31, 2010 from

416 as of March 31, 2009.

Interest. Our net interest charges decreased by 3.96% to Rs.199.19 million for the financial year 2010 from

Rs.207.41 million for the financial year 2009, primarily due to a decrease in interest paid on term loans of 19.15% to

Rs.404.52 million for the financial year 2010, from Rs.500.35 million for the financial year 2009 as a result of a

decrease in interest rates and interest being capitalized and a decrease in interest on others (bank charges) to Rs.1.36

million for the financial year 2010 from Rs.5.74 million for the financial year 2009.

Depreciation / Amortization. Our depreciation / amortization charge decreased by 12.31% to Rs.46.23 million for

the financial year 2010 from Rs.52.72 million for the financial year 2009.

Taxation. Our provision for taxes decreased to Rs.30.11 million for the financial year 2010 from Rs.33.28 million

for the financial year 2009. The provision for income tax was as a result of the sale of residential units during the

financial year 2010.

Net Profit after minority interest and share from associates, as restated. Our profit after tax, minority interest and

share from associates as restated was Rs.125.74 million for the financial year 2010 from a loss of Rs.128.86 million


279

Financial Year 2009 Compared to Financial Year 2008

Income. Our total income increased by 50.20% to Rs.423.68 million for the financial year 2009 from Rs.282.07

million for the financial year 2008, primarily due to an increase in income from operations as a result of an increase

in income from food and beverage and construction income.

Income from Operations. Our income from operations increased by 46.65% to Rs.389.09 million for the financial

year 2009 from Rs.265.32 million for the financial year 2008, primarily due to an increase in rental income by

6.64% to Rs.158.94 million for the financial year 2009 from Rs.149.05 million for the financial year 2008,

recognizing construction income of Rs.78.66 million for the financial year 2009 from nil for the financial year 2008

as a result of undertaking architectural and design activities for certain third parties, recognizing income from food

and beverages of Rs.56.46 million for the financial year 2009 from nil for the financial year 2008 as a result of

acquiring our wholly owned subsidiary, Treasure Food & Beverages Private Limited, which commenced our food

and beverages business at Treasure Island – Indore during the financial year 2009 and an increase in common area

maintenance charges by 1.10% to Rs.39.99 million for the financial year 2009 from Rs.39.56 million for the

financial year 2008 for Treasure Island – Indore. The increase in income from operations was offset by a decrease in

recovery of expenses by 5.99% to Rs.47.26 million for the financial year 2009 from Rs.50.27 million for the

financial year 2008 and a decrease in project management fees by 68.01% to Rs.7.78 million for the financial year

2009 from Rs.24.32 million for the financial year 2008 as a result of the completion of certain project management

contracts during the financial year 2008.

Other Income. Our other income increased to Rs.34.59 million for the financial year 2009 from Rs.16.75 million for

the financial year 2008, primarily due to an increase in interest received on others to Rs.14.50 million for the

financial year 2009 from Rs.3.52 million for the financial year 2008, an increase interest received on bank deposits

to Rs.9.43 million for the financial year 2009 from Rs.2.59 million for the financial year 2008, an increase in

miscellaneous income by 71.61% to Rs.4.79 million for the financial year 2009 from Rs.2.79 million for the

financial year 2008, recognizing income from the sale of land of Rs.2.90 million for the financial year 2009 from nil

for the financial year 2008 and recognizing income from the hire of plant and machinery of Rs.1.92 million for the

financial year 2009 from nil for the financial year 2008. The increase in other income was offset by not recognizing

foreign exchange gain for the financial year 2009 from recognizing Rs.4.10 million for the financial year 2008 and a

decrease in dividend received on current investments to Rs.0.52 million for the financial year 2009 from Rs.2.92



Rs.312.27 million for the financial year 2008, primarily as a result of an increase in interest and finance charges and

operating and other expenses and construction expenses.

Construction Expenses. Our construction expenses were Rs.29.65 million for the financial year 2009 and comprised

Rs.28.00 million of construction expenses and Rs.1.65 million of costs of land. We did not incur other construction

material costs in the financial year 2008.


financial year 2009 from Rs.142.68 million for the financial year 2008, primarily due to recognizing foreign

exchange losses of Rs.22.79 million for the financial year 2009 from nil for the financial year 2008 as a result of

losses on account of a currency swap transaction, recognizing purchases of food and beverages of Rs.20.91 million

for the financial year 2009 from nil for the financial year 2008 as a result of acquiring our wholly owned subsidiary,

Treasure Food & Beverages Private Limited, which commenced our food and beverages business during the

financial year 2009, an increase in rent, rates and taxes to Rs.19.38 million for the financial year 2009 from Rs.4.56

million for the financial year 2008 and an increase in advertisement and sales promotion to Rs.8.16 million for the

financial year 2009 from Rs.1.93 million for the financial year 2008. The operating and other expenses was offset

by a decrease in power and fuel charges by 0.46% to Rs.76.92 million for the financial year 2009 from Rs.77.28


Employee Remuneration and Benefits. Employee remuneration and benefits increased by 41.44% to Rs.58.47

million for the financial year 2009 from Rs.41.34 million for the financial year 2008, primarily due to an increase in

the number of our employees to 416 as of March 31, 2009 from 263 as of March 31, 2008.

280

Interest. Our interest charges increased by 139.12% to Rs.207.41 million for the financial year 2009 from Rs.86.74

million for the financial year 2008, primarily due to an increase in interest paid on debentures of Rs.120.11 million

for the financial year 2009 from Rs.28.22 million for the financial year 2008, an increase in interest paid on

overdraft accounts to Rs.38.45 million for the financial year 2009 from Rs.2.27 million for the financial year 2008

and an increase in interest paid on term loans to Rs.500.35 million for the financial year 2009 from Rs.137.21

million for the financial year 2008, as a result of an increase in our term loans for this period as a result of

refinancing the debt for our Treasure Island – Indore Project.

Depreciation / Amortization. Our depreciation / amortization charge increased by 27.00% to Rs.52.72 million for the

financial year 2009 from Rs.41.51 million for the financial year 2008.

Taxation. Our provision for taxes increased to Rs.33.28 million for the financial year 2009 from Rs.4.27 million for

the financial year 2008, primarily due to an increase in our current tax liability to Rs.29.83 million for the financial

year 2009 from Rs.2.49 million for the financial year 2008.

Net Loss after minority interest and share from associate, as restated. Our net loss after tax, minority interest and

share from associates, as restated increased to Rs.128.86 million for the financial year 2009 from Rs.19.91 million


Financial Year 2008 Compared to Financial Year 2007

Income. Our total income increased by 21.80% to Rs.282.07 million for the financial year 2008 from Rs.231.59

million for the financial year 2007, primarily due to an increase in income from operations.

Income from Operations. Our income from operations increased by 21.51% to Rs.265.32 million for the financial

year 2008 from Rs.218.36 million for the financial year 2007, primarily due to an increase in rental income by

5.29% to Rs.149.05 million for the financial year 2008 from Rs.141.56 million for our Treasure Island – Indore

shopping center, an increase in recovery of expenses by 21.86% to Rs.50.27 million for the financial year 2008 from

Rs.41.25 million for the financial year 2007, an increase in common area maintenance charges by 11.27% to

Rs.39.56 million for the financial year 2008 from Rs.35.55 million for the financial year 2007 and due to

recognizing project management fees of Rs.24.32 million for the financial year 2008 compared to nil for the

financial year 2007.

Other Income. Our other income increased by 26.60% to Rs.16.75 million for the financial year 2008 from Rs.13.23

million for the financial year 2007, primarily as a result of recognizing foreign exchange gain in the financial year

2008 of Rs.4.10 million.


Rs.246.80 million for the financial year 2007, primarily as a result of an increase in operating and other expenses.

Construction Expenses. We did not incur construction expenses during the financial years 2008 and 2007.


financial year 2008 from Rs.113.26 million for the financial year 2007, primarily due to an increase in power and

fuel charges by 10.36% to Rs.77.28 million for the financial year 2008 from Rs.70.02 million for the financial year

2007, an increase in preliminary expenses written off by 24.63% to Rs.18.44 million for the financial year 2008

from Rs.14.80 million for the financial year 2007 and an increase in legal and professional fees to Rs.10.26 million

for the financial year 2008 from Rs.1.87 million for the financial year 2007.

Employee Remuneration and Benefits. Employee remuneration and benefits increased to Rs.41.34 million for the

financial year 2008 from Rs.18.48 million for the financial year 2007, primarily due to increases in salaries, wages

and bonus to Rs.39.64 million for the financial year 2008 from Rs.18.19 million for the financial year 2007 as a

result of an increase in the number of our employees from 263 as of March 31, 2008 from 142 as of March 31, 2007.

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Interest. Our interest charges increased by 9.82% to Rs.86.74 million for the financial year 2008 from Rs.78.98

million for the financial year 2007, primarily due to interest paid on debentures of Rs.28.22 million for the financial

year 2008, interest paid on overdraft accounts of Rs.2.27 million for the financial year 2008 and an increase in

interest paid on term loans to Rs.137.21 million for the financial year 2008 from Rs. 94.23 million in the financial

year 2007.

Depreciation / Amortization. Our depreciation / amortization charges increased by 15.05% to Rs.41.51 million for

the financial year 2008 from Rs.36.08 million for the financial year 2008.

Taxation. Our provision for taxes increased by 65.50% to Rs.4.27 million for the financial year 2008 from Rs.2.58

million for the financial year 2007. The primary component of this increase was an increase in our current tax

liability to Rs.2.49 million for the financial year 2008 from Rs.1.55 million for the financial year 2007.

Net Profit / (Loss) after minority interest and share from associate, as restated. Our net loss after tax, minority

interest and share from associates, as restated, was Rs.19.91 million for the financial year 2008 from a profit of

Rs.19.00 million for the financial year 2007.

Financial Condition, Liquidity and Capital Resources

We broadly define liquidity as our ability to generate sufficient funds from both internal and external sources to

meet our obligations and commitments. In addition, liquidity includes the ability to obtain appropriate equity and

debt financing and loans and to convert into cash those assets that are no longer required to meet existing strategic

and financial objectives. Therefore, liquidity cannot be considered separately from capital resources that consist of

current or potentially available funds for use in achieving long-range business objectives and meeting debt service

and other commitments.

We have historically financed our capital requirements primarily through funds generated from our operations,

financing from banks and other financial institutions in the form of term loans, as well as from sales of equity. We

believe that we will have sufficient capital resources from our operations, net proceeds of this Issue of Equity Shares

and other financings from banks and financial institutions to meet our Company‟s capital requirements for at least

the next 12 months.

Cash Flows

The table below summarizes our cash flows for the financial years 2010, 2009, 2008, 2007 and 2006:

(Rs. in million) Financial Year

2010 2009 2008 2007 2006

Net cash generated from / (used in)

operating activities

(919.50) 604.24 (1,494.51) (166.04) (367.38)


investing activities

(1,810.12) (3,036.42) (1,877.74) (1,399.76) (292.48)


financing activities

2,278.38 3,397.74 3,535.87 1,658.60 682.15

Net increase/ (decrease) in cash and cash

equivalents

(451.24) 965.56 163.62 92.80 22.29

Cash Flows from Operating Activities

Our net cash used in operating activities was Rs.919.50 million for the financial year 2010. The cash used in

operating activities for the financial year 2010 was primarily utilized towards increasing our receivables and our

inventories. Net cash used in operating activities consisted of profit before tax of Rs.178.26 million, as adjusted for a

number of non-cash items, primarily depreciation of Rs.46.23 million, interest expense of Rs.199.19 million and

profit on sale of subsidiaries of Rs.20.29 million and changes in working capital, such as an increase in receivables

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of Rs.354.21 million, increases in loans and advances of Rs.139.36 million, increases in inventories of Rs.610.94

million and a decrease in payables of Rs.164.86 million.

Our net cash generated from operating activities was Rs.604.24 million for the financial year 2009. The cash

generated from operating activities for the financial year 2009 was primarily on account of realization of revenue

from rental income from our shopping centers. Net cash generated from operating activities consisted of loss before

tax of Rs.82.54 million, as adjusted for a number of non-cash items, primarily depreciation of Rs.38.40 million,

interest expense of Rs.207.41 million and interest income of Rs.23.93 million and changes in working capital, such

as a decrease in receivables of Rs.4.93 million, decreases in loans and advances of Rs.359.96 million, increases in

inventories of Rs.732.23 million and an increase in payables of Rs.868.01 million.

Our net cash used in operating activities was Rs.1,494.51 million for the financial year 2008. The cash used in

operating activities for the financial year 2008 was primarily utilized towards increasing our loans and advances and

our inventories. Net cash used in operating activities consisted of loss before tax of Rs.17.61 million, as adjusted for

a number of non-cash items, primarily depreciation of Rs.28.92 million and interest expenses of Rs.86.69 million

and changes in working capital, such as an increase in receivables of Rs.26.64 million, increases in loans and

advances of Rs.679.70 million, increases in inventories of Rs.1,159.96 million and an increase in payables of

Rs.315.11 million.


Our net cash flows used in investing activities was Rs.1,810.12 million for the financial year 2010, primarily as a

result of the purchase of fixed assets of Rs.1,858.70 million and investment in associate companies of Rs.3.33

million, partially offset by net sales proceeds received on sale of fixed assets of Rs.23.85 million.

Net cash used in investing activities was Rs.3,036.42 million for the financial year 2009, primarily as a result of the

purchase of fixed assets of Rs.3,071.10 million and purchase of current investments of Rs.1,435.90 million and

purchase of long term investments of Rs.72.91 million, partially offset by sale of current investments of Rs.1,470.97

million and share application money pending allotment of Rs.69.58 million.

Net cash used in investing activities was Rs.1,877.74 million for the financial year 2008, primarily as a result of the

purchase of fixed assets of Rs.1,814.56 million and purchase of current investments of Rs.1,712.94 million, partially

offset by the sale of current investments of Rs.1,740.41 million, and share application money pending allotment of

Rs.94.58 million.

Cash Flows from Financing Activities

Net cash generated from financing activities was Rs.2,278.38 million for the financial year 2010, primarily as a

result of incurrence of secured loans of Rs.1,918.33 million and unsecured loans of Rs.29.97 million and proceeds

from the issue of shares to minority shareholders by subsidiaries of Rs.511.55 million, partially offset by share

application money paid of Rs.97.50 million and interest payments of Rs.210.73 million.


result of incurrence of secured loans of Rs.1,310.30 million, proceeds from, the issue of debentures of Rs.1,000.00

million and proceeds from the issue of shares to minority shareholders by subsidiaries of Rs.1,569.06 million,

partially offset by share application money paid of Rs.782.50 million and interest payments of Rs.187.52 million.


result of proceeds from the issuance of debentures of Rs.1,699.99 million, proceeds from share application money of

Rs.880.00 million, the incurrence of secured loans of Rs.770.69 million, partially offset by interest payments of

Rs.86.38 million.

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Capital Expenditures

For the financial years 2010, 2009 and 2008, we incurred Rs.1,258.81 million, Rs.470.21 million and Rs.559.79

million, respectively, on capital expenditures (excluding capital work in progress). The capital expenditures for each

of the financial years 2010, 2009 and 2008 were primarily as a result of the completion of our ongoing retail and

residential projects. Our growth plans will require us to incur substantial additional expenditure in the future

financial years, particularly as a result of various ongoing retail and residential projects commencing operations.

Indebtedness

As of March 31, 2010, we had Rs.9,125.52 million of aggregate principal amount of indebtedness outstanding. The

following table summarizes our outstanding consolidated outstanding indebtedness as of March 31, 2010:

(Rs. in Million)

Particulars As of March 31, 2010

Long term loans .......................................................... 7,401.46

Short term loans.......................................................... 1,724.06

Total ............................................................................. 9,125.52

See “Financial Indebtedness” on page 286 of this Draft Red Herring Prospectus for a more detailed summary of our

outstanding indebtedness.

Contingent Liabilities

The following table provides our contingent liabilities as of March 31, 2010:

Particulars (Rs. in

million)

Bank guarantees outstanding………………………………………………………………………….. 103.16

Guarantees on behalf of other companies……………………………………………………………... 9,757.68

Demands of income tax authorities disputed in appeal………………………………………………..

Amount deposited by the Company against above demand…………………………………………...

63.64

14.88

Demands of Sales tax authorities disputed in appeal………………………………………………….. 2.90

Obligation under “Export Promotion of Capital Goods Scheme” of the Central Government …........ 525.07

Service tax on rent from commercial properties…………………………………………. 54.04

Claim from Madhya Pradesh Housing Board on account of dispute …………………….. 115.00

Contractual Obligations and Commercial Commitments

Our contractual obligations and commercial commitments consist principally of the following, as of March 31,

2010, classified by maturity:

(Rs. in Million)

Particulars Payment due by period

Total Less than

one year

One to three

years

Three to

five years

More than

five years

Long term debt 14,081.50 2,144.79 6,285.07 3,416.57 2,235.08

Short term debt 1,724.07 1,724.06 - - -

Contractual commitments 728.11 478.52 249.59 - -

Related Party Transactions

We have engaged in the past, and may engage in the future, in transactions with related parties, including with our

affiliates and certain key management members on an arm‟s lengths basis. Such transactions could be for provision

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of services, purchase and sale of goods, lease of assets or property, sale or purchase of equity shares or entail

incurrence of indebtedness. For details of our related party transactions, see “Related Party Transactions” on page


Off Balance Sheet Commitments and Arrangements

We do not have any off-balance sheet arrangements, derivative instruments, swap transactions or relationships with

affiliates or other unconsolidated entities or financial partnerships that would have been established for the purpose

of facilitating off-balance sheet arrangements.

Quantitative and Qualitative Disclosures About Market Risk

Market risk is the risk of loss related to adverse changes in market prices, including interest rate risk and

commodities risk. We are exposed to commodity risk, interest rate risk and credit risk in the normal course of our

business.

Interest Rate Risk

We currently have floating rate indebtedness for our working capital requirements and also maintain deposits of

cash and cash equivalents with banks and other financial institutions and thus are exposed to market risk as a result

of changes in interest rates. As of March 31, 2010, Rs.5,065.61 million of our indebtedness consisted of floating rate

indebtedness. Upward fluctuations in interest rates increase the cost of both existing and new debts and affect our

results of operations. It is likely that in the current financial year and in future periods our borrowings will rise

substantially given our planned expenditures. We do not currently use any derivative instruments to modify the

nature of our exposure to floating rate indebtedness or our deposits so as to manage interest rate risk.

Commodity Risk

We are exposed to market risk with respect to the prices of raw materials and components used in our developments.

These commodities primarily are steel and cement. The costs of these raw materials and components are subject to

fluctuation based on commodity prices. In the normal course of business, we purchase these raw materials and

components either on a purchase order basis or pursuant to supply agreements. We currently do not have any

hedging instruments in respect of any of the commodities we purchase.

Credit Risk

We are exposed to credit risk on sales receivables owed to us by our customers. If our customers do not pay us in a

timely manner, or at all, we may have to make provisions for or write-off such amounts.

Seasonality

Our revenues and results may be affected by seasonal factors. Seasonal factors particularly affect our fixed-or-

percentage of sales leases and percentage of sales leases. The retail real estate industry has shopping center tenant

sales highest in the third quarter due to the Dusshera, Diwali and the calendar year-end season, and with lesser sales

during the summer months of June, July and August and the back-to-school period. The hotel industry is also

seasonal in nature and the periods during which our hotel tenants experience higher revenue during school vacations

and towards the calendar year-end season.

Adoption of IFRS effective April 2011

The Institute of Chartered Accountants of India, the accounting body that regulates the accounting firms in

India, has announced a road map for the adoption of, and convergence with the IFRS pursuant to which all public

companies in India will be required to prepare their annual and interim financial statements under IFRS,

beginning with the financial year commencing April 1, 2011 to April 1, 2014. Companies with a networth of less

than Rs.5,000.00 million are required to implement IFRS conversion from the financial year 2014. Because there is

285

significant lack of clarity on the adoption of and convergence with IFRS and there is no significant body of

established practice upon which to draw in forming judgments regarding its implementation and application, we

have not determined with a degree of certainty the impact that such adoption will have on our financial reporting.

There can be no assurance that our financial condition, results of operations, cash flows or changes in shareholders‟

equity will not appear materially worse under IFRS than under Indian GAAP.

Known Trends or Uncertainties

Other than as described in this section and the section titled “Risk Factors” on page xi of this Draft Red Herring

Prospectus, to our knowledge there are no known trends or uncertainties that have or had or are expected to have a

material adverse impact on our income from continuing operations.

Significant Developments after March 31, 2010

Except as stated elsewhere in this Draft Red Herring Prospectus, to our knowledge no circumstances have arisen

since March 31, 2010, which is the date of the most recent financial statements included in this Draft Red Herring

Prospectus, which materially and adversely affect or are likely to affect our profitability, our financial condition or

our ability to pay our material liabilities within the next 12 months.

286

FINANCIAL INDEBTEDNESS

Details of Secured Loans

The details of the Company‟s secured loans are as follows:

(a) Fund Based

S.

No.

Name of

the

Lenders

Nature of

Borrowing

Amount

Sanctioned

(in Rs.

Million)

Amount

outstanding as

of May 31,

2010 (in Rs.

Million)

Interest (in %

per annum)

Tenure Repayment Security

1. UCO

Bank

Sanction

Letter dated

December 9, 2005 (Term

loan- I)

825.00 624.60 PLR+ 1.00% (1)

108 months

after completion

of one month from the date of

disbursement.

Repayable in equal

monthly instalments

commencing after completion of one

month from the date

of disbursement till December 2014

Refer to

Note 1

Loan

agreement dated

September

28, 2006 (Term loan –

II )

175.00 112.50 PLR+ 1.00% (1)

100 months

commencing after completion

of one month

from the date of disbursement

Repayable in equal

monthly instalments commencing after

completion of one

month from the date of disbursement till

December 2014 (1) The Company will be liable to pay penal interest at 2% per annum over and above the applicable rate of interest in the event of any failure to repay the installment, on all amounts outstanding for the period of default.

Note 1:

1. Primary: Assignment of future lease rent receivables from the tenant/ licenses of the property, Treasure

Island including the future lease rent receivables from 6th

to 8th

floor, Treasure Island, 11, Tukoganj, M.G.

Road, Indore.

2. Collateral: Exclusive first charge by way of equitable mortgage by deposit of title deeds of land

admeasuring 1,00,000 sq ft and building constructed/ to be constructed thereon, including 6th

to 8th

floor

Treasure Island, 11, Tukogan, M.G. Road, Indore.

3. Personal guarantee of Manish Kalani.

4. Corporate guarantee of Padma Homes Private Limited and Kalani Brothers (Indore) Private Limited.

Corporate Actions

Certain corporate actions, for which the Company requires the prior written approval of the lenders, inter alia

include:

1. Change in the tenant (or lessee of 6th

to 8th

floor, Treasure Island, 11, Tukoganj, M.G. Road, Indore) during

the period of the loan.

2. Change in capital structure.

3. Implement any scheme of expansion/ modernisation/ diversification renovation or acquire any fixed assets

during any accounting year.

4. Formulate any scheme of amalgamation or re-construction.

5. Invest by way of share capital in, or lend or advance funds to, or place deposits with any other concern.

6. Enter into borrowing arrangement either secured or unsecured with any other bank, financial institutions,

company or persons.

7. Undertake guarantee obligations on behalf of any other company, firm or person

8. Declare dividends for any year except out of profits relating to that year after making all due necessary

provisions and provided further that no default had occurred in any repayment obligations.

9. Repay monies brought in by principal shareholders/ directors/ depositors

10. Make drastic changes in their management set up

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11. Effect change in the remuneration payable to the directors either in the form or sitting fees or otherwise.

12. Create further charge, lien or encumbrance over the assets and properties of the Company charged to the

bank in favour of any other bank, financial institutions, company, firm or persons.

13. Sale, assign, mortgage or otherwise dispose off any of the fixed assets charged to the bank.

14. Undertake any trading activity other than the sale of products arising out of its own operations.

(b) Non – Fund Based

S.

No.

Name of the

Lenders

Nature of

Borrowing

Amount

Sanctioned (in

Rs. Million)

Amount

outstanding as

of May 31,

2010

(in Rs. Million)

Interest (in %

p.a.)

Security

1. State Bank

of Indore

Letter of guarantee

and hypothecation

agreement dated

October 7, 2005

4.55 4.55 - Refer Note 1

2. UCO Bank Sanction letter

dated May 17, 2008

100.00 0.69 - Refer Note 2

Note 1:

1. The company has assigned by way of first charge and hypothecated whole of the Company‟s stocks of

construction material and equipment and other raw materials and stores whether raw or in process of

manufacture and all materials and all articles manufactured there from which now or hereafter from time to

time during this security shall be brought into store or be in or about the Company‟s godowns or premises

at 11, Tukoganj, Main Road, Indore or wherever else the same may be including any such goods in course

of transit or delivery.

2. Personal Guarantee of Manish Kalani.

3. Corporate Guarantee of Flexituff International Limited.

Note 2:

1. Primary: Assignment of future lease rent receivables from the tenants of the property, Treasure Island, 11,

Tukoganj, M.G. Road, Indore. Counter Guarantee/indemnity of the Company.

2. Collateral: Exclusive first charge by way of equitable mortgage by deposit of title deeds of land

admeasuring 100,000 sq. ft. and building constructed/ to be constructed thereon.

3. Personal Guarantee of Manish Kalani.

4. Corporate Guarantee of Padma Homes Private Limited and Kalani Brothers (Indore) Private Limited.

288

SECTION VI: LEGAL AND OTHER INFORMATION

OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS

Except as stated below there are no outstanding litigation, suits, criminal or civil prosecutions, proceedings or tax

liabilities against the Company, Promoters and Group Companies and there are no defaults, non-payment of

statutory dues, over-dues to banks/financial institutions, defaults against banks/financial institutions, defaults in

dues payable to holders of any debenture, bonds and fixed deposits and arrears of preference shares issued by the

Company, defaults in creation of full security as per terms of issue/other liabilities, proceedings initiated for

economic/civil/any other offences (including past cases where penalties may or may not have been awarded and

irrespective of whether they are specified under paragraph (I) of Part 1 of Schedule XIII of the Companies Act)

other than unclaimed liabilities of the Company and no disciplinary action has been taken by SEBI or any stock

exchanges against the Company, its Promoters, Group Companies or Directors.

a. Cases involving the Company

Litigation against the Company

1. Ajay Khare has filed a case before the Assistant Labour Commissioner, Indore against the Company

seeking reinstatement to services of the Company and claiming back wages alleging that his services were

terminated as he belonged to a backward caste. Ajay Khare was employed as the House Keeping

Supervisor in the Company from July 1, 2006 whose services were terminated by the Company. Ajay

Khare has sought an amount of Rs. 99,346 as backwages and compensation. The Company has stated that

Ajay Khare had abruptly stopped attending duty and abandoned his work for almost a year from May 28,

2007 and hence Ajay Khare‟s name was struck down from the roll of the Company. The matter is

currently pending for conciliation.

2. Piyush Jain and Dipak Kaushal (“Applicants”) have filed a case before the Additional District Judge,

Indore against the Company, Commissioner – Indore Municipal Corporation, Building Officer - Indore

Municipal Corporation and the Chairman – High Rise Committee, Indore. The Applicants have alleged

certain irregularities and violation of the provisions of the M.P. Municipal Corporation Act, 1956 and the

Madhya Pradesh Bhoomi Vikas Niyam, 1984 with respect to the construction of “Treasure Island” in

Indore and have sought removal of the illegal construction. The Company has replied stating that the

construction of the mall is in accordance with the applicable law and that it has received all requisite

permissions and approvals. The matter is currently pending.

3. Madhukar has filed a case before the Joint Civil Judge, Senior Division, Nanded against the Company,

Milind Narwade, Rahul Narwade, Nilesh Thakkar, Mohammed Mohasin and Mirza Samdani Baig. The

case is in relation to family dispute over the partition of the property bearing survey No.71/4/4

admeasuring 1H 27R situated at Vasarni Taluq in Nanded District, out of which 87R was bought by

NTBPL from Nilesh Thakkar and others who had in turn bought the property from Milind Narwade and

Rahul Narwade in the year 2003. Madhukar has alleged that the property is a joint family property which

has not been partitioned and has alleged fraud in the transfer of the said property. Madhukar has claimed

that he is entitled to half share of the said property. The Company has filed its reply stating that the

property was not bought by the Company but by its subsidiary NTBPL. It is also stated that the suit

property was not an ancestral property, as it was bought by Gangaram (F/o Milind and Rahul) and that

Madhukar has no right to claim partition. The matter is currently pending.

Litigation by the Company

1. The Company, KBIPL and PHPL (“Plaintiffs”) have filed a declaratory suit before the District Court,

Indore against Tata Finance Limited (“TFL”) and Saurabh Kalani in relation to the plot admeasuring

100,000 sq. ft. situated at 11, Tukoganj, Main Road, Indore where the Company has constructed a mall by

the name “Treasure Island” (“Plot”). TFL had advanced a loan to Gilt Pack Limited for which Saurabh

Kalani provided a personal guarantee of Rs. 5,000,000. TFL, later on obtained an arbitration award

against Saurabh Kalani for execution. Upon assignment of the debt to Kotak Mahindra Bank Limited by

TFL, the execution proceedings were carried on by Kotak Mahindra Bank Limited wherein the manager

of Kotak Mahindra Bank Limited filed an affidavit stating that Saurabh Kalani has right, title and interest

in the Plot. The Plaintiffs have sought a declaration that Company is the lessee and KBIPL and PHPL are

289

the lessors of the said Plot and that Saurabh Kalani has no interest in the Plot. The matter is currently

pending.

2. The Company has filed an appeal before the Appellate Tribunal for Electricity, New Delhi against the

Madhya Pradesh Electricity Regulatory Commission (“State Commission”), Madhya Pradesh Paschim

Kshetra Vidyut Vitran Company Limited (“MPPKVVCL”), Indore and its senior accounts officer. In the

appeal, the Company has challenged the order dated October 3, 2008 passed by the State Commission in a

petition filed by the Company, wherein the Company had challenged the order dated April 23, 2007

passed by MPPKVVCL directing the disconnection of power supply to the Company‟s shopping mall

situated at 11, Tukoganj, Main Road, Indore. The order dated April 23, 2007 based on orders dated

October 31, 2006 and November 15, 2006 passed by the State Commission in a suo motu petition

directing MPPKVVCL to disconnect the single point HT connection served through bulk supply to a

group of non-domestic consumers as they do not fall within the 7th

proviso of section 14 of the Electricity

Act, 2003 and was further directed to provide individual connections to all such non-domestic consumers.

In the impugned order dated October 3, 2008 the State Commission upheld the order passed by

MPPKVVL and imposed a levy of Rs. 19,469,717 in accordance with the tariff applicable to the new

category “Shopping Malls” that was notified on April 15, 2008. The Company, in its appeal has sought to

set aside the order dated October 3, 2008 and the demand of Rs. 19,469,717. The matter is currently

pending.

3. The Company has filed a writ petition before the High Court of Madhya Pradesh, Indore Bench against

the Building Officer-Indore Municipal Corporation, challenging the notices dated September 11, 2008

and September 16, 2009 issued by the Building Officer asking the Company to demolish, remove or stop

the use of the shopping mall cum multiplex “Treasure Island” situated at 11, Tukoganj, Main Road,

Indore. The notices allege that (i) the height of the cinema hall is more than the height mentioned in the

approval; (ii) occupation certificate has not been obtained; and (iii) the Company converted the terrace in

to a hotel which was against the map that was approved. The Company has stated that it has received all

permits and approvals including the occupancy certificate for all the floors, except the eighth floor of the

mall, for which an application was made to the Building Officer on December 6, 2006. The Company has

also alleged that the action proposed to be taken by the Building Officer is against the principles of

natural justice. The Company has sought to restrain the Building Officer from interfering with the use and

enjoyment of the mall. The matter is currently pending.

4. The Company has filed a complaint before the First Class Judicial Magistrate, Indore against Suresh

Waran in relation to the dishonour of cheque of Rs. 300,000 issued by the accused. The cheque was

issued towards the payment of security deposit pursuant to a letter of intent dated September 12, 2008

between the Company and the accused for leave and license of a shop on the fifth floor of the Company‟s

mall situated at 11, Tukoganj, M.G. Road, Indore. The Company filed the complaint as the accused failed

to comply with the statutory notice issued by the Company on January 12, 2009. The matter is currently

pending.

Notices issued by the Company

The Company has issued a notice to Pranav Parikh, sole proprietor of Technova, Mumbai on the ground of

misrepresentation on the part of Pranav Parikh in relation to the leave and license agreement dated June 15, 2008

executed between Pranav Parikh, the Company and PML for an area admeasuring 4,540 sq. ft. on the second

floor and an area admeasuring 2,270 sq. ft. at the mezzanine level of the building known as Shree Laxmi

Woollen Mills Estate, Mumbai. The Company has alleged that Pranav Parikh had represented that construction

of the mezzanine area would only cost Rs. 1,500,000 and that the approval for the construction at the mezzanine

would be received from Bombay Municipal Corporation (“BMC”). However, approval for the construction at the

mezzanine was not received and BMC issued a stop work order. In the notice, the Company claimed an amount

of Rs. 5,538,268 from Pranav Parikh. In his reply dated May 29, 2009, Pranav Parikh alleged that the Company

had breached the terms of the leave and license agreement dated June 15, 2008 wherein the Company was

obliged to obtain all necessary approvals for the construction. Pranav Parikh alleged that the Company vacated

the premises during the lock in period and stopped paying the monthly fee payable in terms of the agreement.

Pranav Parikh claimed an amount of Rs. 13,264,776 from the Company in his reply. The Company replied on

July 16, 2009 denying the allegations and in turn sought an enhanced compensation of Rs. 22,217,982 in relation

to the amount paid to the architects employed by the Company during the period in which the construction work

290

was delayed and no work was possible in the office area, which was further enhanced to Rs. 23,285,205 by a

letter dated October 31, 2009. On October 6, 2009, Pranav Parikh sent a letter to the Company enhancing his

claim to Rs. 14,764,776 reflecting the additional cost incurred by him in relation to the construction work

undertaken at the mezzanine area.

Others

Madhya Pradesh Housing Board (“MPHB”) had initiated arbitration proceedings against the Company, PHPL

and KBIPL in 2007. The matter was in relation to a memorandum of understanding dated May 21, 2003

(“MoU”) entered between PHPL, KBIPL, MPHB and the Company, to set up a joint venture, being the

Company, for developing the property situated at 11, Tukoganj, Main Road, Indore into a „Housing cum Family

Entertainment Centre cum Multiplex cum Shopping Mall‟. In terms of the MoU, MPHB was entitled to 51% of

the voting rights in the Company in lieu of the supervisory services to be provided by MPHB and was

accordingly allotted 1,067,300 class A equity shares of face value of Rs. 10 each as partly paid up equity shares

for Re. 1 each, on July 7, 2003. The chairman of MPHB terminated the MoU by a letter dated November 25,

2003 on account of progress not having been made on the project. On March 9, 2004, MPHB alleged that the

MoU was still valid and claimed that the termination by the chairman of MPHB was unauthorized. MPHB, in the

arbitration petition, had amongst other claims, claimed an amount of Rs. 115 million which included

consideration for the supervisory services and compensation. The class A equity shares allotted to MPHB were

forfeited by the Company on April 5, 2007, as no supervisory services were provided by MPHB. The arbitral

tribunal on June 27, 2010 passed an award dismissing the claims made by MPHB and directing the Company to

pay an amount of Rs. 2,187,965 to MPHB on account of the Company utilizing the goodwill of MPHB to obtain

conversion of land use.

b. Cases involving Directors

A. Manish Kalani

1. State of Madhya Pradesh has filed a criminal complaint (No. 15020/2007) before the Chief Judicial

Magistrate, Indore against Manish Kalani and B. Rajesh Nair in their capacity as the directors of Naman

Mall Management Company Private Limited and others. The complaint has been filed under the

provisions of the Building and Other construction Workers (Regulation of Employment & Condition of

Service) Act, 1996 in relation to an accident at the construction site situated at 170, RNT Marg, Indore

resulting in the death of a contract labourer. The matter is currently pending.

2. Mahesh Garg has filed a complaint against Manish Kalani and others before the Director General of

Police and Superintendent of Police, Economic Offence Wing, Bhopal in relation to the change of land

use of the property situated at 11, M. G. Road, Indore from residential to commercial. It was alleged that

the land on which the Treasure Island mall was constructed was changed by the government to favour the

project. Subsequently a public interest litigation was filed by Kishore Samarite before the High Court of

Jabalpur seeking directions as no receipt was filed in relation to the matter. The High Court of Jabalpur

has by an order dated April 19, 2010 dismissed the public interest litigation. The matter is pending before

the Director General of Police and Superintendent of Police, Economic Offence Wing, Bhopal.

B. B. Rajesh Nair

For details, see “Outstanding Litigation and Material Defaults - Cases involving Directors - Manish Kalani” on


C. Mukesh Kacker

A first information report was filed by the Special Police Establishment, Madhya Pradesh (“SPE”) against

Mukesh Kacker, in his capacity as the managing director of M.P. Urja Vikas Nigam and others in relation to the

alleged irregularities in the purchase and supply of 5,000 solar lanterns to M.P. Urja Vikas Nigam, a state public

sector undertaking, by M/s Kriti Fabricators Limited, Indore. Pursuant to the investigation, the SPE prosecuted

14 persons, including Mukesh Kacker under sections 13(1) (d) and 13(2) of the Prevention of Corruption Act,

1988 (“PC Act”) and section 120-B of the Indian Penal Code. However, it was contended that public servants are

protected from prosecution under the provisions of section 19 of the PC Act and under section 197 of the Code

of Criminal Procedure (“Cr.P.C”) and thus, they cannot be prosecuted unless the government concerned grants

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sanction for prosecution. In this case, the Government of Madhya Pradesh and the Government of India refused

to grant sanction to prosecute Mukesh Kacker under section 197 of the Cr.P.C. and under section 19 of the PC

Act respectively. However, after the voluntary retirement by Mukesh Kacker, the SPE filed a supplementary

charge-sheet in the case no. 2/05 against Mukesh Kacker on the ground that as of date no sanction was required

from the Government since he had retired from the government service. The objections raised by Mukesh

Kacker before the court of Special Judge, Bhopal, against taking such cognizance of the case were dismissed by

the order dated August 16, 2007. Mukesh Kacker then filed a petition under section 482 of Cr.P.C before the

Madhya Pradesh High Court against the order of the Special Judge, Bhopal, which was dismissed by its order

dated March 29, 2010. Thereafter, Mukesh Kacker has filed a special leave petition before the Supreme Court

challenging the order passed by the High Court of Madhya Pradesh challenging the taking of cognizance by the

Special Judge, Bhopal. The matter is currently pending.

c. Cases involving Subsidiaries

Cassandra Realty Private Limited (“CRPL”)

Notices issued by CRPL

CRPL has filed a complaint before Judicial Magistrate, Class I, Indore against M/s Sukhsagar Motors Private

Limited, Amandeep Singh Khanna and B.S. Khanna in relation to the dishonour of cheque of Rs. 5,000,000

issued by the accused. The cheque was issued by the accused as security for the inter corporate deposit of Rs.

5,000,000 placed by CRPL with the accused for a period of 30 days from June 30, 2009 to July 30, 2009. On the

request of the accused, the said inter corporate deposit was extended from July 30, 2009 to September 30, 2009.

CRPL has filed the case as the accused failed to comply with the requirement of the statutory notice issued by

CRPL on October 28, 2009. The accused had given post dated cheques in reply to the statutory notice dated

October 28, 2009 and stated that CRPL was intimated well in advance not to present the cheque. The matter is

currently pending.

Indore Treasure Market City Private Limited (“ITMCPL”) (Formerly known as Five Star Developers

Private Limited)

Cases filed against ITMCPL

Pradeep Hinduja has filed a case before the Additional District Judge, Indore against ITMCPL, Commissioner-

Indore Municipal Corporation and Joint Director Town and Country Planning, Indore alleging that ITMCPL has

been constructing a mall cum multiplex in Khajrana area, Indore in violation of plans approved by the Indore

Municipal Corporation (“IMC”). Pradeep Hinduja has sought for a direction from the court to the

Commissioner, IMC to remove the alleged illegal construction and to initiate legal action against the concerned

engineers of IMC. ITMCPL has filed its reply and has stated that the construction carried out by them is in

accordance with the permission of High-Rise Committee of the State Government and that there has been no

illegality in the construction. The matter is currently pending.

Indore Treasure Town Private Limited (“ITTPL”)

Notices received by ITTPL

1. ITTPL has received a notice dated September 19, 2009 from Advocate Arun Kumar Mundada on behalf

of Madhuri Tawari W/o Purushottam (“Notice”) alleging misrepresentation in relation to the booking

made by Madhuri for a unit in “Treasure Vihar”, a residential complex being developed by ITTPL.

Madhuri had paid an advance of Rs. 31,000 in lieu of the booking made by her for the unit. In the Notice

it was alleged that ITTPL had misrepresented that the rate of the unit was Rs. 1,400 per sq. ft. aggregating

to Rs. 841,000 and that in the receipt given it was stated that rate of the unit was Rs. 1,700 per sq. ft.

aggregating to Rs. 1,021,000. It is also alleged in the Notice that the flat has been sold to another person.

ITTPL replied on October 3, 2009 stating that there was no misrepresentation on the part of ITTPL and

that it was a misunderstanding of Madhuri. It has also been stated by ITTPL that the flat has been sold to

another person as Madhuri failed to make the payment of Rs. 70,000 within the stipulated period.

292

2. ITTPL has received a notice dated September 28, 2009 from Amar Singh Rathore (“Notice”) alleging

misrepresentation in relation to the booking made by Amar for a unit in “Treasure Town”, a residential

complex being developed by ITTPL. Amar had paid an advance of Rs. 51,000 in lieu of the booking

made by him for the unit. In the Notice it was alleged that ITTPL had misrepresented regarding the

schedule of payments. ITTPL replied on October 27, 2009 stating that there was no misrepresentation on

the part of ITTPL and also as Amar failed to comply with the necessary formalities and payment

schedule, ITTPL has cancelled his booking and refunded Rs. 51,000 which was received as an advance.

3. ITTPL has received a notice dated October 14, 2009 from Advocate G.S. Solanki on behalf of Rajesh

Tiwari (“Notice”) alleging misrepresentation in relation to the booking made by Rajesh for a unit in

“Treasure Vihar”, a residential complex being developed by ITTPL. Rajesh has paid an advance of Rs.

31,000 in lieu of the booking made by him for the unit. In the Notice it was alleged that ITTPL had

misrepresented regarding the rate and the schedule of payments and hence in addition to the advance

amounts he also claimed Rs. 50,000 as damages. ITTPL replied on October 29, 2009 sating that there was

no misrepresentation on the part of ITTPL and cancelled his booking and refunded Rs. 31,000 which was

received as an advance.

Nanded Treasure Bazaar Private Limited (“NTBPL”)

Notices received by NTBPL

NTBPL has received a notice dated September 29, 2009 from Advocate S.M. Chaoosh on behalf of M/s Devra

Constructions (“Notice”) seeking payment of balance amount due from NTBPL to Devra Constructions on

account of the construction work done pursuant to the work order dated May 2, 2007, in relation to the

construction of the shopping mall at Nanded, developed by NTBPL. Devra Constructions has claimed Rs.

22,072,363 consisting of Rs. 19,972,363 as the amount due from NTBPL and rent for six months on the props

and span in the premises of the shopping mall. NTBPL has sent its reply on November 10, 2009 stating that a

letter was sent to Devra Constructions by NTBPL on September 5, 2009 claiming that Devra Constructions had

received additional amount from NTBPL. It is stated that Devra Constructions had done actual work for Rs.

14,952,912 but had received Rs. 24,671,257 from NTBPL. The letter dated September 5, 2009 had claimed the

balance amount of Rs. 9,718,345 from Devra Constructions. NTBPL has now claimed Rs. 10,039,450 which

includes the balance amount payable and the interest at the rate of 18% and has denied all the claims made by

Devra Constructions in its notice dated September 29, 2009.

d. Cases involving Promoters

Manish Kalani

For details, see “Outstanding Litigation and Material Defaults - Cases involving Directors - Manish Kalani” on


Kalani Brothers (Indore) Private Limited (“KBIPL”)

Cases filed against KBIPL

For details of the cases filed against KBIPL, see “Outstanding Litigation and Material Developments - Cases

involving Promoters - Cases filed against PHPL” on page 293 of this Draft Red Herring Prospectus.

Cases filed by KBIPL

1. KBIPL has filed a case (No. 8386/2004) before the Commissioner Municipal Corporation, Indore against

the Assessment Officer, Municipal Corporation, Indore in relation to the assessment of property tax.

KBIPL has challenged the demand made by the Municipal Corporation, Indore for property tax on

commercial use of the land for the mall namely, Treasure Island for the year 2004 - 2005 and has claimed

that the property tax for the year 2004 - 2005 in relation to the said land was already paid during the

293

construction of the mall. The amount involved in the matter is Rs. 2.11 million. The matter is currently

pending.

2. KBIPL has filed a case (No. 2462/2004) before the Mayor - in - Council, Municipal Corporation, Indore

against the Commissioner of Indore Municipal Corporation and Assistant Engineer cum Assessment

Officer, Indore Municipal Corporation in relation to the assessment of property tax. KBIPL has

challenged the demand made by the Municipal Corporation, Indore for property tax on commercial use of

the land for the mall namely, Treasure Island for the year 2004 - 2005 and has claimed that the property

tax for the year 2004 - 2005 in relation to the said mall was already paid during the construction of the

mall. The amount involved in the matter is Rs. 2.11 million. The matter is currently pending.

Padma Homes Private Limited (“PHPL”)

Cases filed against PHPL

The State of Madhya Pradesh has filed a case (No. 80/06-07/48 (3)) before Collector of Stamp, Indore against

PHPL and KBIPL in relation to the payment of stamp duty on refundable security deposit with respect to the

property owned by PHPL and KBIPL situated at 11, Tukoganj, Main Road, Indore and leased out to the

Company. PHPL and KBIPL have stated that the stamp duty demanded is in excess of the amount payable in

accordance with the market value of the property. The matter is currently pending.

Cases filed by PHPL

Nil

e. Cases involving Group Companies

MRK Pipes Limited (“MRKPL”)

Cases filed by MRKPL

MRKPL has filed an appeal (No. 612/06-07) before the Commissioner of Income Tax (Appeals), Indore against

the Assistant Commissioner of Income Tax challenging the order dated December 1, 2006, passed by the

assessing officer for the assessment year 2004-05. In the assessment order dated December 1, 2006, the assessing

officer has made an addition of Rs. 2.41 million on account of non-verification of creditors under the provisions

of the Income Tax Act. MRKPL has sought to set aside the aforementioned addition made by the assessing

officer. The matter is currently pending.

Cases filed against MRKPL

Nil

Triple A Real Estates Private Limited (“TREPL”)

Cases filed against TREPL

Indore Development Authority and the State of Madhya Pradesh have filed two special leave petitions before the

Supreme Court of India, against TREPL and Saurabh Properties Private Limited challenging the order passed by

the High Court of Madhya Pradesh in relation to the dispute regarding a plot bearing survey no. 67/4/3 in village

Bicholi Hapsi, Indore, which is owned by TREPL. The site plan submitted by the TREPL to the Town and

Country Planning Department was not approved on the grounds that the said plot was included in the draft

development scheme No. 164 announced by the Indore Development Authority in the year 1994. Subsequently,

TREPL filed a writ petition in the High Court of Madhya Pradesh challenging the draft development scheme No.

164 announced by the Indore Development Authority in the year 1994, and the scheme was quashed by the High

Court by its order dated May 15, 2007. The High Court of Madhya Pradesh in a contempt petition filed by

TREPL, sanctioned the site plan and granted the permission for construction of the house on the said plot. The

294

said order has been challenged by the Indore Development Authority and the State of Madhya Pradesh before the

Supreme Court of India and the matters are still pending.

Cases filed by TREPL

Nil

Flexituff International Limited (“FIL”)

Cases filed against FIL

1. Cogent Silver Fiber Private Limited has filed a case (No. 1321/2005) before the High Court of Delhi

against Noble Fiber Technologies Inc., USA, Country Manager - Noble Fiber Technologies Inc. and FIL

seeking specific performance of a memorandum of understanding dated April 28, 2005 between Cogent

Silver Fiber Private Limited and Noble Fiber Technologies Inc. The memorandum of understanding was

in relation to exclusive marketing of the products of Noble Fiber Technologies Inc. under the brand name

“X – Static”. Cogent Silver Fiber Private Limited has alleged that Noble Fiber Technologies Inc. has

violated the terms of the memorandum of understanding and has entered into a marketing arrangement

with FIL. FIL has stated there is no marketing arrangement between FIL and Noble Fiber Technologies

Inc. The matter is currently pending.

2. The Assistant Development Commissioner Labour Department, has filed a criminal case (No. 2782/2009)

before the Chief Judicial Magistrate, Dhar against Pawan Kumar Jain and FIL in relation to the accidental

death of Gajanan Bawanthade on June 11, 2009 while loading a container in the factory premises of FIL.

The matter is currently pending.

Cases filed by FIL

1. FIL has filed a case (No. 38386/2007) before the District Court, Indore, against Verma Fibers and Suman

Verma under section 138 of the Negotiable Instruments Act, 1881 on the ground that the cheque no.

64870 issued by Verma Fibers was dishonoured with a remark “funds insufficient”. The cheque was

issued by Verma Fibers towards amount outstanding from Verma Fibers to FIL in relation to certain cloth

fabrics purchased by Verma Fibers from FIL. The amount involved in the matter is Rs. 0.1 million. The

matter is currently pending.

2. FIL has filed a criminal complaint before the Chief Judicial Magistrate, Dhar against Maxam Packaging

Inc., USA, Divya Shipping & Clearing Services Private Limited, Rushmi Logistics Private Limited and

Maersk India Private Limited in relation to misappropriation of a consignment of Jumbo Bags dispatched

on August 27, 2007. It has been alleged that the consignment was delivered without obtaining duly

discharged documents and accordingly FIL was not able to recover the payment. The Chief Judicial

Magistrate, Dhar has forwarded the case for police investigation. The matter is currently pending.

3. FIL has filed a writ petition (No. 254/2010) before the High Court of Madhya Pradesh against the

Commercial Tax Department seeking a direction to return the cheques issued by FIL. FIL had issued four

cheques aggregating to an amount of Rs. 9.39 million to the Commercial Tax Department towards the

levy of Entry Tax. It has been alleged that the Commercial Tax Department collected the tax payment

without adjudicating the liability to pay the tax. The matter is currently pending.

Notices issued by FIL

FIL has issued a notice on March 16, 2009 to Madhya Pradesh Audyogik Kendra Vikas Nigam (Indore) Limited

and its managing director claiming refund of the penalty and surcharge of Rs. 1,574,321 imposed on FIL for

allegedly drawing electric power in excess of the contracted demand. The matter is under discussion for

settlement.

295

GOVERNMENT APPROVALS

In view of the approvals listed below, the Company can undertake this Issue and its current business activities and

no further major approvals from any governmental or regulatory authority or any other entity are required to

undertake the Issue or continue the business activities. Unless otherwise stated, these approvals are all valid as of

the date of this Draft Red Herring Prospectus.

Approvals for the Issue

1. The Board of Directors have, pursuant to resolution passed at its meeting held on June 11, 2010, authorised

the Issue, subject to the approval by the shareholders of the Company under Section 81(1A) of the

Companies Act.

2. The shareholders have, pursuant to a resolution dated June 15, 2010 under Section 81(1A) of the

Companies Act, authorised the Issue.

3. In - principle approval from the NSE dated [●].

4. In - principle approval from the BSE dated [●].

Approvals in relation to incorporation, change of name and registered office

I. The Company

1. Certificate of Incorporation dated July 22, 1999 issued by the Registrar of Companies, Madhya Pradesh,

Gwalior to R.M.M. Construction Private Limited.

2. Fresh Certificate of Incorporation dated June 29, 2001 issued by the Registrar of Companies, Madhya

Pradesh & Chhattisgarh pursuant to change of its name to R.M.M. Construction Limited.

3. Fresh Certificate of Incorporation dated June 29, 2001 issued by the Registrar of Companies, Madhya

Pradesh & Chhattisgarh pursuant to change of its name to Entertainment World Developers Limited.

4. Fresh Certificate of Incorporation dated February 28, 2003 issued by the Registrar of Companies, Madhya

Pradesh & Chhattisgarh pursuant to change of its name to Entertainment World Developers Private

Limited.

5. Fresh Certificate of Incorporation dated April 5, 2007 issued by the Registrar of Companies, Maharashtra,

Mumbai pursuant to change of its name to EWDPL India Private Limited.

6. Fresh Certificate of Incorporation dated September 2, 2008 issued by the Registrar of Companies,

Maharashtra, Mumbai pursuant to change of its name to Entertainment World Developers Private Limited.

7. Fresh Certificate of Incorporation dated February 5, 2010 issued by the Deputy Registrar of Companies,

Maharashtra, Mumbai pursuant to change of its name to Entertainment World Developers Limited.

II. Subsidiaries of the Company

1. Ujjain Treasure Bazaar Private Limited

Certificate of Incorporation dated February 24, 2006 issued by the Deputy Registrar of

Companies, West Bengal to Horizon Complex Private Limited.

Certificate of Registration of company law board order for change of state from West Bengal to

Maharashtra dated May 8, 2008 issued by Assistant Registrar of Companies, Maharashtra

Mumbai.

296

Fresh Certificate of Incorporation dated September 29, 2008 issued by the Deputy Registrar of

Companies, Maharashtra, Mumbai pursuant to change of name from Horizon Complex Private

Limited to Ujjain Treasure Bazaar Private Limited.

2. Nanded Treasure Bazaar Private Limited

Certificate of Incorporation dated January 25, 2007 issued by the Registrar of Companies,

Maharashtra, Mumbai to Entertainment World Developers Nanded Private Limited.

Fresh Certificate of Incorporation dated September 23, 2008 issued by the Registrar of

Companies, Maharashtra, Mumbai pursuant to change of name from Entertainment World

Developers Nanded Private Limited to Nanded Treasure Bazaar Private Limited.

3. Amaravati Treasure Bazaar Private Limited

Certificate of Incorporation dated April 3, 2008 issued by the Assistant Registrar of Companies,

Maharashtra, Mumbai to Amaravati Entertainment World Developers Private Limited.

Fresh Certificate of Incorporation dated September 19, 2008 issued by the Registrar of

Companies, Maharashtra, Mumbai pursuant to change of name from Amaravati Entertainment

World Developers Private Limited to Amaravati Treasure Bazaar Private Limited.

4. EWDPL Residential Holdings Private Limited

Certificate of Incorporation dated July 23, 2007 issued by the Registrar of Companies,

Maharashtra, Mumbai to EWDPL Residential Holdings Private Limited.

5. EWDPL Five Star Hospitality Private Limited

Certificate of Incorporation dated March 13, 2008 issued by the Assistant Registrar of Companies,

Maharashtra, Mumbai to EWDPL Five Star Hospitality Private Limited.

6. Marvell Mall Development Company Private Limited


Maharashtra, Mumbai to Marvell Mall Development Company Private Limited.

7. The Baroda Commercial Corporation Limited

Certificate of Incorporation dated October 22, 1942 issued by the Registrar of Companies, Baroda

to The Baroda Commercial Corporation Limited.

8. Treasure World Developers Private Limited

Certificate of Incorporation dated July 18, 2006 issued by the Assistant Registrar of Companies,

Maharashtra, Mumbai to Gwalior Entertainment World Private Limited.


Companies, Maharashtra, Mumbai pursuant to change of name from Gwalior Entertainment

World Private Limited to Indore Entertainment World Developers Private Limited.

Fresh Certificate of Incorporation dated October 7, 2008 issued by the Deputy Registrar of

Companies, Maharashtra, Mumbai pursuant to change of name from Indore Entertainment World

Developers Private Limited to Treasure World Developers Private Limited.

297

III. Subsidiaries of Treasure World Developers Private Limited

1. Raipur Treasure Island Private Limited

Certificate of Incorporation dated July 17, 2006 issued by the Assistant Registrar of Companies,

Maharashtra, Mumbai to Raipur Entertainment World Private Limited.


Companies, Maharashtra, Mumbai pursuant to change of name from Raipur Entertainment World

Private Limited to Raipur Treasure Island Private Limited.

2. Chandigarh Treasure Island Private Limited

Certificate of Incorporation dated July 25, 2006 issued by the Registrar of Companies, Punjab,

H.P. & Chandigarh to Turning Point Estates Private Limited.

Certificate of Registration of company law board order for change of state from Punjab to

Maharashtra dated July 18, 2008 issued by Assistant Registrar of Companies, Maharashtra,

Mumbai.


Companies, Maharashtra, Mumbai pursuant to change of name from Turning Point Estates Private

Limited to Chandigarh Treasure Island Private Limited.

3. Jabalpur Treasure Island Private Limited

Certificate of Incorporation dated June 29, 2006 issued by the Assistant Registrar of Companies,

Maharashtra, Mumbai to Entertainment World Jabalpur Private Limited.


Companies, Maharashtra, Mumbai pursuant to change of name from Entertainment World

Jabalpur Private Limited to Jabalpur Treasure Island Private Limited.

4. Annapoorna Entertainment World Developers Private Limited

Certificate of Incorporation dated April 18, 2007 issued by the Registrar of Companies,

Maharashtra, Mumbai, to Bhopal Entertainment World Developers Private Limited.


Companies, Maharashtra, Mumbai pursuant to change of name from Bhopal Entertainment World

Developers Private Limited to Annapoorna Entertainment World Developers Private Limited.

5. Indore Treasure Market City Private Limited


Companies, West Bengal to Five Star Developers Private Limited.



Mumbai.

Fresh Certificate of Incorporation dated November 25, 2008 issued by the Deputy Registrar of

Companies, Maharashtra, Mumbai pursuant to change of name from Five Star Developers Private

Limited to Indore Treasure Market City Private Limited.

298

6. Udaipur Treasure Market City Private Limited

Certificate of Incorporation dated January 25, 2007 issued by the Assistant Registrar of

Companies, Maharashtra, Mumbai to Udaipur Entertainment World Private Limited.


Companies, Maharashtra, Mumbai pursuant to change of name from Udaipur Entertainment

World Private Limited to Udaipur Entertainment World Private Limited.

7. Dazzling Properties Private Limited

Certificate of Incorporation dated August 10, 2006 issued by the Assistant Registrar of

Companies, National Capital Territory of Delhi and Haryana to Dazzling Properties Private

Limited.

Certificate of Registration of company law board order for change of state from Delhi to

Maharashtra dated March 14, 2009 issued by Assistant Registrar of Companies, Maharashtra

Mumbai.

8. Entertainment World Developers Amritsar Private Limited


Maharashtra, Mumbai to Entertainment World Developers Amritsar Private Limited.

9. Chandigarh Entertainment World Private Limited

Certificate of Incorporation dated January 27, 2007 issued by the Assistant Registrar of

Companies, Maharashtra, Mumbai to Chandigarh Entertainment World Private Limited.

10. Jodhpur Entertainment World Developers Private Limited

Certificate of Incorporation dated September 10, 2007 issued by the Assistant Registrar of

Companies, Maharashtra, Mumbai to Jodhpur Entertainment World Developers Private Limited.

11. Treasure MEP Services Private Limited

Certificate of Incorporation dated February 12, 2008 issued by the Assistant Registrar of

Companies, Maharashtra, Mumbai to EWDPL Engineering Private Limited.


Companies, Maharashtra, Mumbai pursuant to change of name from EWDPL Engineering Private

Limited to Treasure MEP Services Private Limited.

12. Intesys Technologies Private Limited


Maharashtra, Mumbai to Intesys Technologies Private Limited.

13. Treasure Food & Beverages Private Limited


Maharashtra, Mumbai to EWDPL Food & Beverages Private Limited.

299


Companies, Maharashtra, Mumbai pursuant to change of name from EWDPL Food & Beverages

Private Limited to Treasure Food & Beverages Private Limited.

14. Cassandra Realty Private Limited

Certificate of Incorporation dated August 13, 1999 issued by the Registrar of Companies, Madhya

Pradesh, Gwalior to RMK Power Private Limited.

Fresh Certificate of Incorporation dated October 16, 2006 issued by the Registrar of Companies,

Madhya Pradesh and Chhattisgarh pursuant to change of name from RMK Power Private Limited

to Cassandra Reality Private Limited.

Fresh Certificate of Incorporation dated January 10, 2007 issued by the Registrar of Companies,

Madhya Pradesh and Chhattisgarh pursuant to change of name from Cassandra Reality Private

Limited to Cassandra Realty Private Limited.

15. Treasure Showcase Private Limited

Certificate of Incorporation dated May 3, 2007 issued by the Registrar of Companies,

Maharashtra, Mumbai to EWDPL Holdings Private Limited.

Fresh Certificate of Incorporation dated January 20, 2010, issued by the Deputy Registrar of

Companies, Maharashtra, Mumbai purusnat to change of name from EWDPL Holdings Private

Limited to Treasure Showcase Private Limited

16. Treasure Hospitality Private Limited


Maharashtra, Mumbai to EWDPL Raipur Hospitality Private Limited.


Companies, Maharashtra, Mumbai pursuant to change of name from EWDPL Raipur Hospitality

Private Limited to Treasure Hospitality Private Limited.

17. Indore Treasure Town Private Limited


Companies, West Bengal to 21st Centuri Properties Private Limited.

Fresh Certificate of Incorporation dated July 3, 2006 issued by the Assistant Registrar of

Companies, West Bengal pursuant to change of name from 21st Centuri Properties Private Limited

to Twenty First Century Properties Private Limited.



Mumbai.

Fresh Certificate of Incorporation dated December 29, 2008 issued by the Deputy Registrar of

Companies, Maharashtra, Mumbai pursuant to change of name from Twenty First Century

Properties Private Limited to Indore Treasure Town Private Limited.

300

18. Wanderland Real Estates Private Limited


Companies, West Bengal to Wanderland Real Estates Private Limited.

19. Banglore Entertainment World Developers Private Limited

Certificate of Incorporation dated April 3, 2008 issued by the Assistant Registrar of Companies,

Maharashtra, Mumbai to Banglore Entertainment World Developers Private Limited.

IV. Subsidiaries of Indore Treasure Town Private Limited

1. Pune Entertainment World Developers Private Limited


Maharashtra, Mumbai to Pune Entertainment World Developers Private Limited.

2. Entertainment World Developers Bijalpur Private Limited

Certificate of Incorporation dated January 17, 2007 issued by the Registrar of Companies, West

Bengal to Entertainment World Developers Bijalpur Private Limited.



Mumbai.

Project wise approvals:

1. Chandigarh Treasure Island, Chandigarh

Approval (Memo No. 8455 / CTP (Pb) /SP-432 (Mohali)) dated October 22, 2008 issued by the

Chief Town Planner, Punjab, Chandigarh for change of land use for commercial purpose.

Grant of special package of incentive (Memo No CC/JDP/Mega/Turning/8388) dated November

15, 2006 issued by the Department of Industries and Commerce, Government of Punjab to the

mega multiplex project of Turning Point Estates Private Limited.

Approval (No.10054/CTP (PB) MPR-69) dated December 12, 2008 issued by the Chief Town

Planner, Office of Town and Country Planning, Chandigarh, regarding the building plan.

Technical sanction (No. 9179/CTP (PB) MPR-69) dated November 25, 2008 issued by the Chief

Town Planner, Country and Town Planning Department, Chandigarh, regarding the zoning plan

sheet No. ZN-01.

NOC (No. 319) dated January 28, 2009 issued by the Executive Engineer, PWD (B &R) Central

Works Division, Roopnagar, for setting up multiplex project in Village Badmajra.

Certificate (No. R-222/2008) dated April 30, 2008 issued by the Assistant Labour Commissioner,

Office of Registering Officer, Government of Punjab, under the provisions of the Contract Labour

(Regulation and Abolition) Act,1970, in relation to the registration of the contract labour.

Provisional NOC (No.22) dated June 29, 2009 issued by the Assistant Divisional Fire Officer, Fire

Brigade, S.A.S, for erection of building as part of the project at Badmajra, Mohali.

301

Environment Clearance (No. 21-1094/2007-IA.III) dated August 11, 2008 issued by the

Additional Director (IA), Ministry of Environment and Forests, Government of India for setting

up mall, multiplex and hotel project at Mohali, Punjab.

NOC (No. MHL/Hotel/57/2009/806) dated February 25, 2009 issued by the Punjab Pollution

Control Board for setting up of a multiplex cum mall and hotel at Badmajra, Mohali, valid for one

year from the date of issue or till the completion of the project, whichever earlier.

NOC from aviation angle (No. AirHQ/s17726/4/ATS(PC-CDLXXI)/Dy.No.550/F/2009/D(Air-II))

dated September 16, 2009 issued by the Ministry of Defence, Government of India, for

construction of mega multiplex in village Badmajra, Chandigarh, Punjab.

Sanction (Memo No. 733/CTP (PB)/MPR-69) dated February 22, 2010, issued by the Office of

Town and Country Planning, Punjab, for the revised business plans.

2. Surya Treasure Island, Bhilai

Approval dated March 18, 2008 issued by the Chairman, Site Approval Committee & the

Commissioner of Municipal Corporation at Bhilai, as permission for high rise.

Approval (No. 2247/Na.Gra.Ni./2008 and 105/Na.Gra.Ni./2007/) dated January 1 and July 24,

2008 issued by the Office of Joint Director, Town and Country Planning Department, Indore as a

permission for development for the purpose of multiplex.

Certificate (No. 336/DG/2008) dated May 20, 2008 issued by the Registering Officer, Office of

the Registering Officer, Government of Chhattisgarh, under the provisions of the Contract Labour

(Regulation and Abolition) Act,1970, in relation to the registration of the contract labour. The

licence is valid till December 31, 2010.

Environment Clearance (No. 27/SEAC-CG/EC/Bldg.Const./DRG/30/09) dated October 16, 2009

issued by the Member Secretary, State Level Environment Impact Assessment Authority,

Chhattisgarh.

Approval’s applied for:

Application dated August 12, 2009 to the Building Officer, Municipal Corporation, Bhilai for

renewal of permission (No. 2461) dated August 23, 2008 with respect to the building construction.

3. Raipur Treasure Island, Raipur (Jora)

Certificate (No. 532/RPR/2007) dated January 25, 2007 issued by the Registering Officer, Office

of the Registering Officer, Government of Chhattisgarh, under the provisions of the Contract

Labour (Regulation and Abolition) Act, 1970, in relation to the registration of the contract labour.

Certificate dated March 12, 2010, issued by the Land Diversion Branch, Collectors Office

Diversion Branch, Raipur, for the change of land for commercial use.

Environment Clearance (No. 21-594/2006-IA.III) dated January 31, 2008 issued by the Director

(IA), Ministry of Environment and Forests, Government of India for construction of shopping mall

cum multiplex at Raipur, Chhattisgarh.

Permission to Establish (No. 4564/TS/CECB/2008) dated August 07, 2008 issued by the Member

Secretary, Chhattisgarh Environment Conservation Board, Raipur, under the provisions of the

Water (Prevention & Control of Pollution) Act, 1974 and under the Air (Prevention & Control of

Pollution) Act, 1981.

302

Approval (No. 1547/NGN/PL-102007) dated March 28, 2007 issued by the Joint Director, City

and Village Investment, Raipur (C.G.) with regard to the development permission.

Approval (No. 5382/RPR/57/2007) dated June 28, 2008 issued by the Joint Director, City and

Village Investment, Raipur C.G., as permission for high rise.

Permission (No. 1983/NGN/CB/BN/Case No. 07/2007) dated April 25, 2007 issued by the Joint

Director, City and Village Investment, Raipur C.G, for the purpose of building construction.

Permission (No. 5512/NGN/Bhawan-07/07/2008) dated September 18, 2008 issued by the Joint

Director, Town and Country Planning, Raipur C.G., for the purpose of development.

4. Jabalpur Treasure Island, Jabalpur

Approval (No. 274/Nagrane/Baithak/Multi/07/L.171206) dated February 21, 2007 issued by the

Office of the Joint Director, Town and Country Planning Department, Jabalpur, and a consent

dated February 07, 2008 by the Site Approval Committee, formed for the purpose of permission

on High Buildings under Rule 14 of the Madhya Pradesh Land Development Rules, 1984.

Permission (No. B.Adhi/07/08/188) dated April 30, 2007 issued by the Building Officer, Office of

the Building Officer, Municipal Corporation, Jabalpur, for the purpose of construction/

reconstruction/ conversion of building till April 30, 2010.

Permission (No. 102/144) dated April 27, 2007 issued by the Officer of The Commissioner/

Competent Authority, Municipal Corporation, Jabalpur, for commencement of development works

in respect of construction of Multiplex in the approved layout.

Certificate (No. 102) dated April 17, 2007 issued by the Office of the Commissioner, Municipal

Corporation, Jabalpur, for the purpose of registration of Coloniser, valid till five years from the

period of bank guarantee.

Environment Clearance (No. 21-580/2006-I.A.III) dated January 07, 2008 issued by the Director

(IA), Ministry of Environment and Forests, Government of India for construction of shopping

mall-cum-multiplex at Jabalpur, M.P.

Permission to Establish (No.17381/TS/MPPCB/2008) dated September 29, 2008 issued by the

Member Secretary, Madhya Pradesh Pollution Control Board, Bhopal, under the provisions of the

Water (Prevention & Control of Pollution) Act, 1974 & under the Air (Prevention & Control of


Permission (No. 579/Nagrani/07/L-171206) dated April 3, 2007 issued by the Joint Director,

Office of the Joint Director, Town and Country Planning, Jabalpur, for the purpose of building

construction.

Certificate (No. 05/2007) dated May 9, 2007 issued by the Registering Officer, Registering

Officer, Building Construction Department, Jabalpur, in relation to the registration of the contract

labour.

Certificate (No. 167/JBP/L/07) dated June 18, 2007 issued by the Licensing Officer, Officer of the

Registrar, Government of Madhya Pradesh, in relation to the registration of the contract labour.

303

5. Ujjain Treasure Bazaar, Ujjain

Permission to Establish (No.9196/TS/MPPCB/2008) dated October 31, 2008 issued by the


Water (Prevention & Control of Pollution) Act, 1974 & under the Air (Prevention & Control of


Approval (No. 1457/PPU/1/07) dated September 3, 2007 issued by the Office of Deputy Director,

Urban and Rural Investment, Ujjain, regarding the high rise building approval given in the

committee meeting held on August 23, 2007.

Permission (No. 1888/PPU/130/07/NGN) dated December 17, 2007 issued by the Deputy

Director, Urban and Rural Investment, Ujjain for the purpose of development. The permission is

valid for three years from the date of issue.

Approval (No. 479/2007/3) dated March 30, 2009 issued by the Office of Municipal Corporation,

Ujjain, for the renovation work with regard to the building construction. The time period for the

construction has been increased for one more year from the date of issue of this approval.

Certificate of registration (No. 89) dated November 13, 2007 by the Office of Municipal

Corporation, Ujjain, for the registration of „M/s Horizon Complex Private Limited‟ as a builder

and developer. The registration is valid for a period of five years from the date of issue of this

certificate.

Certificate (No. 167/UJN.08) dated June 12, 2008 issued by the Registering Officer, Office of the

Registering Officer, Government of Madhya Pradesh, under the provisions of the Contract Labour

(Regulation and Abolition) Act, 1970, in relation to the registration of the contract labour. The

license is valid for five years from the date of issue.


Application dated January 28, 2010 to the Deputy Inspector General, Fire Police Services,

Madhya Pradesh, Indore for renewal of the provisional NOC (No.UMN/Fire Brigade/NOC/655-

D/07) issued dated August 8, 2007 for the purpose of fire brigade arrangement.

6. Treasure Market City (MR-10), Indore

Environment Clearance (No. 21-682/2006-I.A.III) dated June 11, 2007 issued by the Director

(IA), Ministry of Environment and Forests, Government of India for construction of shopping mall

cum multiplex, office building, 200 room hotel and residential apartments at Indore, Madhya

Pradesh.

Permission to Establish (No.6682/TS/MPPCB/2007) dated August 20, 2007 issued by the Member

Secretary, Madhya Pradesh Pollution Control Board, Bhopal, under the provisions of the Water

(Prevention & Control of Pollution) Act, 1974 and under the Air (Prevention & Control of


Diversion order (Case No. 169-A-2/07-08) dated February 23, 2008 issued by the Court Divisional

Officer, Division Indore, regarding the diversion of 7.904 hectors of agricultural land into

Multiplex Complex u/s 172 (1) of Madhya Pradesh Revenue Code 1959.

Approval (No. 2333/SHMT/NGN/07) dated April 15, 2008 issued by the High Rise Committee,

Office of Town and Country Planning Department, Indore, for the construction of 60 meters high

building.

304

Permission (No. Dist.Office/NGN/276/08/5519) dated October 17, 2008 issued by the Office of

Joint Director, City and Village Nivesh, Indore, for the high rise building.

NOC (No. AAI/Indore/LM/7717) dated November 28, 2007 issued by the Manager, Airport

Authority of India.

NOC (No. 437/TS/NH/2007) dated February 25, 2008 issued by the Executive Engineer, PWD

NH division, Indore for usage of road the project.

Permission (No. SDM/T&CP/2006/2334) dated April 18, 2007 issued by the Office of the Joint

Director, Town & Country Planning, Indore, for the development, planning and construction of

multiplex premiseswithin a period of three years from the date of issue of the permission.

Permission (No. 24138//Building Permission/Zone no/08/2009) dated October 16, 2009 issued by

the Building Officer of Municipal Corporation, Indore, in relation to the construction of the

building. The permission is valid till September 22, 2012.

Certificate of registration (No. 293/C.C./2007/Indore) dated April 19, 2007 by the Commissioner,

Office of the Municipal Corporation, Indore, for the registration of „Five Star Developers Private

Limited‟ as a builder and developer. The registration is valid for a period of five years from the

date of issue of this certificate.

Certificate (No. 364/Ind/07) dated June 8, 2007 issued by the Registering Officer, Assistant

Labour Commissioner Indore Division, Indore, under the provisions of the Contract Labour

(Regulation and Abolition) Act, 1970, in relation to the registration of the maximum 20 contract

labour per day.

Approval (No. 278/col.cell/2006) dated May 9, 2007 issued by the Deputy Commissioner and

Officer Incharge of Colony Cell, Municipal Corporation, Indore, as a sanction of the site plan of

multiplex building on the land of village Khajrana.

7. Indore Central, Indore

Approval (No. 2196/NGN/SDM/2007) dated April 13, 2007 issued by the Office of Joint Director,

Urban and Rural Investment, Indore, regarding the High Rise Committee site approval to construct

30 meter high building.

Approval (No. SDM/TCP/2006/4363) dated May 29, 2006 issued by the Office of Joint Director,

Town and Country Planning, Indore, approving the site for construction of a shopping mall.

Certificate of registration (No. 24/K.S/2006/Indore) dated June 5, 2006 by the Commissioner,

Office of the Municipal Corporation, Indore, for the registration of „M/s Naman Mall Management

Company Private Limited‟ as a builder and developer. The registration is valid for a period of five

years from the date of issue of this certificate.

Certificate (No. 347/IND/2006) dated August 3, 2006 issued by the Office of Registrar,

Government of Madhya Pradesh, under the provisions of the Contract Labour (Regulation and

Abolition) Act, 1970, in relation to the registration of the contract labour.

Final NOC (Temporary) (No. PFS/HQ/NOC/FP-CELL/52-J) dated May 26, 2009 issued by the

IGP & Fire Authority, Police Fire Services, H.Q., Bhopal, in relation to the fire safety.

Permission to Establish (No. 66861/TS/MPPCB/2007) dated August 20, 2007 issued by the


305

Water (Prevention & Control of Pollution) Act, 1974 and under the Air (Prevention & Control of


NOC (No. AB/MNKR/2009) dated June 8, 2009 issued under the Rule 6 of Madhya Pradesh

Cinema (Control) 1972, by the Office of District Magistrate and Licencing Officer, Dist. Indore,

in relation to the showing of cinema. The NOC is valid for two years.

Approval (No. 22496) dated May 29, 2009 issued by the Building Officer, Office of the Municipal

Corporation, Indore, in relation to the partial occupancy of basement III, basement II, basement I,

ground floor, first floor, second floor, third floor, fourth floor and fifth floor except multiplex.

Permission (No. /S/Building Permission/North/South; File No. 107412) dated July 1, 2006 issued

by the Building Officer, Office of Municipal Corporation, Indore, in relation to the building

construction. The permission is valid till June 30, 2009.

Partial Permission (No. 800/BO-7/BP/09) dated July 17, 2009 issued by the Building Officer,

Office of the Municipal Corporation of Indore, for occupancy of the fourth floor, fifth floor

(multiplex) and sixth floor (office).

8. Nanded Treasure Bazaar, Nanded

Certificate (No. NED/ 168) dated May 14, 2007 issued by the Assistant Commissioner of Labour

and Licensing/ Registering Officer, Office of The Registering Officer, Government of

Maharashtra, under the provisions of the Contract Labour (Regulation and Abolition) Act, 1970,

in relation to the registration of the contract labour. The registration is valid till December 31,

2010.

Consent to Establish (No. BO/RO(P&P)/R/CC-219) dated March 5, 2008 issued by the Member

Secretary, Maharashtra Pollution Control Board, Mumbai, under the provisions of the Water

(Prevention & Control of Pollution) Act, 1974 and under the Air (Prevention & Control of

Pollution) Act, 1981 and Authorisation under Rule 5 of the Hazardous Wastes (Management &

Handling) Rules 1989 and Amendment Rules, 2003.

Consent to Operate (No. BO/RO(P&P)/AD-3039-09/CC-373) dated October 10, 2009 issued by

the Maharashtra Pollution Control Board, Mumbai, under the provisions of the Water (Prevention

& Control of Pollution) Act, 1974 and under the Air (Prevention & Control of Pollution) Act,

1981 and Authorisation under Rule 5 of the Hazardous Wastes (Management & Handling) Rules

1989 and Amendment Rules, 2003, valid till September 30, 2011.

Order (No. 08/MSB-2/JMB/NAP/CR-107) dated January 12, 2009 issued by the Collector, Office

of the Collector, Nanded, in relation to the amalgamation of land for commercial use.

Permission (No. NWCMC/TPS/134/A/09) dated December 16, 2009 issued by the Assistant

Director, Nanded Waghala City Municipal Corporation, Nanded, in relation to the building

construction. The interim construction sanction will be valid for one year from the date of issue.

Provisional NOC (No. Navashamanp/AVAS/NHPP/154/8) dated January 12, 2009 issued by the

Fire Brigade & Emergency Services, Nanded Vaghala City Corproation, Nanded, in relation to the

fire brigade arrangements.

9. Indore Treasure Town (Bijalpur), Indore

Order (Case No. 127/A2/08-09) dated December 29, 2008 issued by the Court of Divisional

Officer, Indore, with regard to the change of land use from agricultural land into non-agricultural

use only for the residential purposes.

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Approval (No. 2616/2008/NGN/Indore) dated May 12, 2008 issued by the Office of Joint

Director, Town and Country Planning, Indore, in relation to the residential plan for the land at

village Bijalpur and for public use and semi public uses, office, complex and multiplex use of the

land at village Bijalpur.

Approval (No. 3742/LY-60/09NGN/09/Indore) dated July 3, 2009 issued by the Office of Joint

Director, Town and Country Planning, Indore, with regard to the plan.

Certificate of registration (No. KS/2009/Indore/387) dated July 21, 2009 issued by the

Commissioner, Office of the Municipal Corporation, Indore, for the registration of „M/s Indore

Treasure Town Private Limited; Entertainment World Developers Bijalpur Private Limited; Pune

Entertainment World Developers Private Limited‟ as a builder and developer. The registration is

valid for five years from the date of issue.

Certificate of registration (No. 389) dated August 7, 2009 issued by the The Commissioner,

Municipal Corporation of Indore, Madhya Pradesh, for registration of „M/s Indore Treasure Town

Private Limited; Entertainment World Developers Bijalpur Private Limited; Pune Entertainment

World Developers Private Limited‟ as a colonizer. The registration is valid for five years from the

date of issue.

Permission (No. 2315/Col.Cell/09) dated November 10, 2009 issued by the Deputy Commissioner

and Office Incharge, Office of Municipal Corporation of Indore, in relation to the development

work.

Permission (No 27027/Build Permission/North/South) dated May 25, 2010 issued by Building

Officer, Municipal Corporation, Indore in relation to construction of building valid till April 25,

2013.

NOC (No. 389) dated October 19, 2009 issued by the Member Secretary, Central Ground Water

Authority, Ministry of Water Resources, Indore, in relation to the abstraction of 1500 m3 per day

of ground water for drinking and domestic purposes.


Application dated December 29, 2006, made to the Superintendent Engineer, Madhya Pradesh

Pollution Control Board, Bhopal for the consent of Air and Water for proposed residential

township at Bijalpur, Indore.

10. Land Mark Treasure Town, Udaipur (Badgaon)

Environment Clearance (No. 21-1097/2007-IA.III) dated July 14, 2008 issued by the Additional

Director (IA), Ministry of Environment and Forests, Government of India for proposed

construction of residential project at Badgaon, Udaipur, Rajasthan.

Permission (No. B-Plan/NVP/208/1702) dated November 10, 2008 issued by the Office of the

City Development Authority, Udaipur, in relation to the building construction. The permission is

valid till 3 years from the date of issue of this permission.

Certificate (No. 11/08) dated October 31, 2008 issued by the Registration Officer, Labour

Department, Government of Rajasthan, in relation to the registration of the contract labour. The

registration is valid till November 2011.

Permission (No. B-Plan/NVP/2009/2412) dated October 22, 2009 issued by the Office of the City

Development Authority, in relation to the construction of residential flats.

307

Permission (No. B-Plan/CDT/2010/7494) dated May 3, 2010 issued by the Office of the City

Development Trust, Udaipur in relation to the construction of residential flats.

Letter (No. UIT/Reg./08/714) dated July 14, 2008 issued by the office of the Urban Improvement

Trust, Udaipur, for the mutation of land.

11. Treasure Market City Udaipur, Udaipur (Shobhagpura)

Environment Clearance (No. 21-1096/2007-IA.III) dated July 14, 2008 issued by the Additional

Director (IA), Ministry of Environment and Forests, Government of India for proposed

construction of mall cum hotel, multiplex and residential complex at Udaipur, Rajasthan.

Approval (No. 91/2008) dated September 25, 2008 issued by the Member Secretary, State Level

Land Use Changes Committee, Rajasthan, Jaipur, in relation to the change of land use from

residential to commercial.

Letter (No. LandAllotment/ Relation/CIT/2009/3595) dated September 29, 2009 issued by the

Secretary, Office of City Development Trust, Udaipur, in relation to the amended allotment of the

land as a leasehold right for a period of 99 years.


Application dated November 10, 2008, made to the Member Secretary, Rajasthan State Pollution

Control Board, Jaipur for the grant of Consent to Establish under Air (Prevention & Control of

Pollution) Act, 1981 and Water (Prevention & Control Pollution) Act, 1974 for the proposed mall

cum residential cum hotel project of Udaipur Entertainment World Private Limited, Sobhagoura,

Udaipur, Rajasthan.

12. Treasure Fantasy, Indore

Order (Case no. 210/A-2/08-09) dated March 20, 2009 issued by the Divisional Officer, the Court

of Divisional Officer Revenue, Indore, in relation to the change of land use from agricultural to

residential and commercial purposes

Approval (No. NGN/Jica/2007/LY113/6527) dated October 10, 2007 issued by the Office of Joint

Director, Town and Country Planning Department, District Office, Indore, in relation to the use of

land for residential and commercial purpose.

Certificate (No. 17/2009) dated July 4, 2009 issued by the Office of the Divisional Officer,

Revenue, Indore, for the purpose of registration of Coloniser, valid till five years from the date of

issue of the certificate.

Approval (No. 5773/SP-199/09/T&CP/09) dated October 15, 2009 issued by the Joint Director,

Town and Country Planning Department, District Office, Indore, as permission for development

of plots/group housing and shops and multiplex. The permission is valid for three years from the

date of issue.

NOC (No. 21-4(37)NCR/CGWA/2008-873) dated October 19, 2009 issued by the Member

Secretary, Central Ground Water Authority, Ministry of Water Resources, Indore, in relation to

the abstraction of 1062 m2 per day of ground water for drinking and domestic purposes.

308

13. Treasure Island (Indore)

Partial Use Certificate (No. 1716) dated December 22, 2005, issued under the Rule 31 (G)

Schedule Appendix (H) and as per the Land Development Rule 1984, by the Office of Municipal

Corporation, Indore, as a NOC for use of the basement 3, ground floor and upto third floor.

Partial Use Certificate (No. 70/BO) dated April 7, 2006 issued under the Rule 31 (G) Schedule

Appendix (H) Issued as per the Land Development Rule 1984, by the Office of Municipal

Corporation, Indore, as a permission to use the fourth and fifth floor.

Partial Use Certificate (No. 675/BO) dated July 12, 2007, issued under the Rule 31 (G) Schedule

Appendix (H) Issued as per the Land Development Rule 1984, by the Indore Municipal

Corporation, Indore, as a permission to use the sixth and seventh floor.

14. Treasure Bazaar, Amaravati

Order (No./NAP-34/SATURNA-18/2008-2009) dated January 5, 2009 issued by the Office of the

Collector, Amaravati, with regard to the change of land use from agricultural land into commercial

purpose.

Permission (No. AMNP/SSNR/BP/139/08) dated November 7, 2008, issued by the Office of

Amaravati Corporation, Amaravati, in relation to the construction on the area.

Permission (No. 854) dated November 14, 2008 issued by the Town Planning Corporation,

Amaravati for commencement of construction work till November 13, 2009.

15. Treasure Bazaar, Baroda

NOC (No. AAI/20012/841/2006-ARI(NOC)) dated November 10, 2006 issued by the Airport

Authority of Inidia, New Delhi, in relation to the construction of the proposed building by The

Baroda Commercial Corporation Limited.

Preliminary fire NOC (No. ASJ 3784/05-07) dated February 20, 2007 issued by the Fire Brigade

and Emergency Services, Vadodra for the fire safety to be implemented in the proposed multi

floor building construction.

Zone certificate (No. UDA/Bh.po.t.v.o/zone cert/1/2006) dated December 13, 2006 issued by the

Vadodra City Development Authority, Vadodra.

Approvals regarding Intellectual Property Rights

A. Trademark Licenses:

Trademark No. 1538464 granted to the Company in Class “42” under the name of “Entertainment

World Developers Private Limited” with respect to food and dirks, temporary accommodation,

rest homes, retirement homes, computer programming, rental of portable buildings, architectural

construction, hotel, restaurant, cafeterias, rental of meeting rooms and other services cannot be

classified in other classes, valid for a period of 10 years from October 14, 2008.


World Developers Private Limited” with respect to insurances, financial affairs, monetary affairs,

real estate affairs, valid for a period of 10 years from October 10, 2008.


World Developers Private Limited” with respect to building construction & supervision,

309

maintenance and repairing services, construction information, rental of construction equipment,

mining extraction, pluming, painting, interior, and exterior, road paving, underwater repair,

building insulating, safe maintenance and repair, restoration repair, installation services in

shipping industry, cleaning services, chimney cleaning, dry cleaning, disinfecting, housekeeping

services, lubrication services, township, valid for a period of 10 years from October 10, 2008.


World Developers Private Limited” with respect to education, providing of training,

entertainment, sporting and cultural activities, shopping malls, production of shows, arranging and

conducting of symposiums, providing of recreation facilities and information, valid for a period of

10 years from October 11, 2008.

Trademark No. 1491358 granted to Five Star Developers Private Limited and Entertainment

World Developer Private Limited in Class “37” under the name of “TREASURE CITY” with

respect to township, building and construction services, valid for a period of 10 years from March

28, 2008.

Trademark No. 1489285 granted to the Company in Class “37” under the name of “THE

MIRAGE” with respect to building construction, valid for a period of 10 years from March 28,

2008.

Trademark No. 1489378 granted to the Company in Class “41” under the name of “THE

MIRAGE” with respect to multiplex theatre included, valid for a period of 10 years from March

28, 2008.

Trademark No. 1050238 granted to Entertainment World Developers Limited in Class “16” under

the name of “THE MIRAGE” with respect to publication, stationery & printed matter, valid for a

period of 10 years from July 6, 2006.

Trademark No. 1044912 granted to the Company in Class “16” under the name of “TREASURE

ISLAND” with respect to publication stationery and printed matter valid for a period of 10 years

from July 1, 2007.

Trademark No. 1538468 granted to the Company in Class “41” under the name of “EWDPL” with

respect to education, providing of training, entertainment, sporting and cultural activities,

shopping malls, production of shows, arranging and conducting of symposiums, providing of

recreation facilities and information, valid for a period of 10 years from March 9, 2007. Trademark No. 01636485 granted to the Company in Class “36” under the name of “TREASURE

HOMES” with respect to real estate affairs.


HOMES” with respect to township, building constructions of residential and commercial

complexes.


HOMES” with respect to shopping mall multiplex theatre and other entertainment services.


HOMES” with respect to providing of food drinks, temporary accommodation.


TOWN” with respect real estate affairs, property brokerage and related consultancy.

310


TOWN” with respect township, building construction of residential and commercial complexes,

repair and maintenance of building.


MARKET CITY” with respect real estate affairs.


MARKET CITY” with respect township, building constructions of residential and commercial

complexes.


MARKET CITY” with respect providing of food drinks, temporary accommodation.


BAZAR” with respect real estate affairs.


BAZAR” with respect township, building constructions of residential and commercial complexes.


BAZAR” with respect providing of food and drinks temporary accommodation.

Trademark No. 01636481 granted to the Company in Class “36” under the name of

“TREASURE” with respect real estate affairs.


“TREASURE” with respect township, building constructions of residential and commercial

complexes.


“TREASURE” with respect shopping mall, multiplex theatre and other entrainment services.


“TREASURE” with respect providing of food drinks, temporary accommodation.

Trademark No. 01636497 granted to the Company in Class “36” under the name of “TI” with

respect real estate affairs.


respect township, building constructions of residential and commercial complexes.


respect shopping mall. multiplex theatre and other entertainment services.


respect providing of food and drinks, temporary accommodation.

Trademark No. 1674796 granted to EWDPL Food & Beverages Private Limited in Class “42”

under the name of “PUNJABI TADKA” with respect restaurants, hotels, cafeterias, fast food, self

service restaurants, snack and sandwich bar services, coffee bar & other food & drinks related

services included in class 42.


under the name of “COCONUT CHUTNEY‟S” with respect restaurants, hotels, cafeterias, fast

311

food, self service restaurants, snack and sandwich bar services, coffee bar & other food & drinks

related services included in class 42.


under the name of “PUNJABI TADKA” with respect restaurants, hotels, cafeterias, fast food, self

service restaurants, snack and sandwich bar services, coffee bar & other food & drinks related

services included in class 42.


under the name of “COCONUT CHUTNEY‟S” with respect restaurants, hotels, cafeterias, fast

food, self service restaurants, snack and sandwich bar services, coffee bar & other food & drinks

related services included in class 42.

Trademark No. 1538465 granted to the Company in Class “35” under the name of “EWDPL”

with respect importers and exporters, marketing and distributions, advertising, subscriptions

agency for magazine newspaper, journal, business management, business administration, office

functions, sales promotion, help in the working and management of commercial undertakings.


with respect insurance, financial affairs, monetary affairs, real estate affairs.


with respect building construction & supervision, maintenance & repairing services, construction

information, rental of construction equipment, mining extraction, plumbing, painting, interior and

exterior, road paving, underwater repair, building insulating, safe maintenance & repair,

restoration repair; installation services in shipping industry, cleaning services, chimney cleaning,

dry cleaning, disinfecting, housekeeping services, lubrication services, township.


with respect providing of food and drinks, temporary accommodation, rest homes, retirement

homes, computer programming , rental of portable buildings, architectural consultation, hotel,

restaurant, cafeterias, rental of meeting rooms and other services cannot be classified in other

classes.


World Developers Private Limited” with respect importers and exporters, marketing and

distributions, advertising, subscriptions agency for magazine newspaper, journal, business

management, business administration, office functions, sales promotion, help..


CITY” with respect real estate affairs.


CITY” with respect providing of food and drinks, temporary accommodation.


ISLAND” with respect real estate affairs.

B. Copyright Licenses

Copyright Registration Certificate No. A-81801/2008 granted to Five Star Developers Private

Limited under the name of “Treasure City” issued on January 7, 2008.

Copyright Registration Certificate No. A-81866/2008 granted to EWDPL India Private Limited

under the name of “EWDPL” issued on November 17, 2007.

312

C. Applications pending for registration of trademarks

Name of the company Trade mark applied

for

Date of

application

Class Application

Number

M/s EWDPL India Private

Limited

“TREASURE

MARKET CITY”

December 10,

2007

41 01636495


Limited

“EWDPL India Private

Limited”

June 19, 2007 37 01569829


Limited

“TREASURE BAZAR” December 10,

2007

41 01636490

M/s Treasure Food &

Beverages Private Limited

“FOOD.COM” November 25,

2009

42 1888354

M/s Treasure Food &


“THANDA FUNDA” May 23, 2009 42 1888370

M/s Treasure Food &


“NAWABI BLUE” May 23, 2009 42 1888348

M/s Treasure Food &


“105 EAST” May 23, 2009 42 1888352

M/s EWDPL Food &


“ORIENTAL SPICE” March 27, 2008 42 1674797

M/s EWDPL Food &


“ORIENTAL SPICE”

(logo)

March 27, 2008 42 1674798

EWDPL India Private Limited “TREASURE CITY” December 31,

2007

41 1636503

EWDPL India Private Limited “TREASURE CITY” December 31,

2007

37 1636504

Entertainment World

Developers Limited

“TREASURE VIHAR” June 2, 2010 35 1974452

Entertainment World

Developers Limited

“GREEN GOLD” June 2, 2010 36 1974455

Entertainment World

Developers Limited

“GREEN GOLD” June 2, 2010 37 1974457

Entertainment World

Developers Limited

“GREEN GOLD” June 2, 2010 35 1974454

Entertainment World

Developers Limited


Entertainment World

Developers Limited


Tax related registrations

S.

No.

Name of the Company Service Tax Code PAN

1. Entertainment World Developers

Limited (Formerly Entertainment World

Developers Private Limited)

AAACE9739KST001 AAACE9739K

2. Treasure Food & Beverages Private

Limited (Formerly EWDPL Food &

Beverages Private Limited )

AABCE9406EST001 , ODC/99 AABCE9406E

3. Indore Treasure Market City Private

Limited (Formerly Five Star Developers

Private Limited.)

AAACF9660QST001R-

ST/IND/ARCH/129/2006-07

AAACF9660Q

4. Naman Mall Management Company

Private Limited

AACCN1164HST001(R-

ST/IND/GTA/1957/2006-07)

AACCN1164H

313

S.

No.

Name of the Company Service Tax Code PAN

5. Indore Treasure Town Private Limited

(Formerly Twenty First Century

Properties Private Limited.)

AAACZ2541GST001(R-

ST/IND/ARCH/130/2006-07)

AAACZ2541G

6. Chandigarh Treasure Island Private

Limited (Formerly Turning Point Estates

Private Limited)

AACCT7457RST001 / GTA-2229 AACCT7457R

7. Intesys Technologies Private Limited AABCI8639RST002 WCS/27 AABCI8639R

8. Nanded Treasure Bazaar Private Limited

(Formerly Entertainment World

Developers Nanded Private Limited)

AABCE7134RST001 , GTA-2031 AABCE7134R

9. Udaipur Treasure Market City Private

Limited. (Formerly Udaipur

Entertainment World Limited.)

AAACU8782CST001 / GTA-2228 AAACU8782C

10. Treasure MEP Services Private Limited

(Formerly EWDPL Engineering Private

Limited.)

AABCE9208QST001, CE/259 AABCE9208Q

11. Jabalpur Treasure Island Private Limited

( Formerly Entertainment World

Jabalpur Private Limited )

AABCE6191JST001 , GTA-2032 AABCE6191J

12. Raipur Treasure Island Private Limited

(Formerly Raipur Entertainment World

Private Limited)

AADCR3382GST001,

GTA-2030

AADCR3382G

13. Treasure World Developers Private

Limited

AACCG6934EST001/MC/96 AACCG6934E

14. Ujjain Treasure Bazaar Private Limited

(Formerly Horizon Complex Private

Limited)

AABCH6953MST001 / GTA-2227 AABCH6953M

15. Amaravati Treasure Bazaar Private

Limited

- AAHCA0086G


Amritsar Private Limited

- AABCE7814N

17. Annapoorna Entertainment World


- AADCB1542J

18. Banglore Entertainment World


- AADCB4307M


Bijalpur Private Limited

- AABCE7049R

20. Cassandra Realty Private Limited - AACCR0633H

21. Chandigarh Entertainment World Private

Limited

- AADCC0029R

22. Dazzling Properties Private Limited - AACCD4633P

23. Treasure Showcase Private Limited - AABCE7813M

24. Treasure Hospitality Private Limited AABCE9403BST001 AABCE9403B

25. EWDPL Residential Holdings Private

Limited

- AABCE8455D

26. Jodhpur Entertainment World


- AABCJ8852H

27. Pune Entertainment World Developers

Private Limited

- AACEP2817R

28. Surya Treasure Island Private Limited AADCB1463EST001 AADCB1463E

29. Five Star Hospitality Privae Limited - AABCE9404G

314

OTHER REGULATORY AND STATUTORY DISCLOSURES

Authority for the Issue

The Issue has been authorised by the resolution of the Board of Directors passed at their meeting held on June 11,

2010, subject to the approval of shareholders through a special resolution to be passed pursuant to section 81 (1A) of

the Companies Act.

The shareholders have authorised the Issue by a special resolution passed pursuant to Section 81(1A) of the

Companies Act at the Extra-Ordinary General Meeting of the Company held on June 15, 2010.

Prohibition by SEBI

The Company, Promoter, Directors, Promoter Group entities and Group Companies have not been prohibited from

accessing or operating in capital markets under any order or direction passed by SEBI.

The companies, with which Promoter, Directors or persons in control of the Company are associated as promoters,

directors or persons in control have not been prohibited from accessing or operating in capital markets under any

order or direction passed by SEBI.

Details of the entities that our Directors are associated with, which are engaged in securities market related business

and are registered with SEBI for the same, have been provided to SEBI.

Prohibition by RBI

Except as stated below, neither the Company, its Promoters, the Directors, the relatives of Promoters (as defined

under the Companies Act) or the Group Companies have been identified as wilful defaulters by the RBI or any other

governmental authority. There are no violations of securities laws committed by them in the past or are pending

against them.

Gilt Pack Limited, a public limited company, promoted by P. S. Kalani (father of Manish Kalani) and Saurabh

Kalani (brother of Manish Kalani) defaulted on certain loans and was wound up by an order of the Board for

Industrial and Financial Reconstruction in 1991. Pursuant to this event, P. S. Kalani, being the promoter of Gilt Pack

Limited, was included in the list of wilful defaulters by RBI.

Eligibility for the Issue

The Company is eligible for the Issue in accordance with the Regulation 26(2) of the SEBI Regulations, which states

as follows:

(2) “An issuer not satisfying any of the conditions stipulated in sub-regulation (1) may make an initial public

offer if:

(a) (i) the issue is made through the book building process and the issuer undertakes to allot at

least fifty per cent. of the net offer to public to qualified institutional buyers and to refund

full subscription monies if it fails to make allotment to the qualified institutional buyers;

OR

(ii) at least fifteen per cent. of the cost of the project is contributed by scheduled commercial

banks or public financial institutions, of which not less than ten per cent. shall come from

the appraisers and the issuer undertakes to allot at least ten per cent. of the net offer to

public to qualified institutional buyers and to refund full subscription monies if it fails to

make the allotment to the qualified institutional buyers;

315

AND

(b) (i) the minimum post-issue face value capital of the issuer is ten crore rupees;

OR

(ii) the issuer undertakes to provide market-making for at least two years from the date of

listing of the specified securities, subject to the following:

(A) the market makers offer buy and sell quotes for a minimum depth of three

hundred specified securities and ensure that the bid-ask spread for their quotes

does not, at any time, exceed ten per cent.;

(B) the inventory of the market makers, as on the date of allotment of the specified

securities, shall be at least five per cent. of the proposed issue.”

We are an unlisted company not complying with the conditions specified in the Regulations 26(1) SEBI Regulations

and are therefore required to meet both the conditions detailed in Clause (a) and Clause (b) of Regulation 26(2) of

the SEBI Regulations.

We are complying with Regulation 26(2) (a) (i) of the SEBI Regulations and at least 50% of the Issue is

proposed to be allocated to QIBs and in the event we fail to do so, the full subscription monies shall be

refunded to the Bidders.

We are complying with Regulation 43(2) of the SEBI Regulations and Non-Institutional Bidders and Retail

Individual Bidders will be allocated 15% and 35% of the Issue respectively.

We are also complying with Regulation 26(b)(i) of the SEBI Regulations and the post-issue face value

capital of the Company shall be Rs. 1,297.63 million, which is more than the minimum requirement of Rs.

10 Crore (Rs. 100 million).

Hence, we are eligible for the Issue under Regulation 26(2) of the SEBI Regulations.

Disclaimer Clause of SEBI

AS REQUIRED, A COPY OF THE DRAFT RED HERRING PROSPECTUS HAS BEEN SUBMITTED TO

SEBI. IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF THE DRAFT RED HERRING

PROSPECTUS TO SEBI SHOULD NOT, IN ANY WAY, BE DEEMED OR CONSTRUED THAT THE

SAME HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANY

RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR THE

PROJECT FOR WHICH THE ISSUE IS PROPOSED TO BE MADE OR FOR THE CORRECTNESS OF

THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THE DRAFT RED HERRING

PROSPECTUS. THE BOOK RUNNING LEAD MANAGERS HAVE CERTIFIED THAT THE

DISCLOSURES MADE IN THE DRAFT RED HERRING PROSPECTUS ARE GENERALLY

ADEQUATE AND ARE IN CONFORMITY WITH SEBI (ISSUE OF CAPITAL AND DISCLOSURE

REQUIREMENTS) REGULATIONS, 2009 IN FORCE FOR THE TIME BEING. THIS REQUIREMENT

IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING AN

INVESTMENT IN THE PROPOSED ISSUE.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE COMPANY IS PRIMARILY

RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT

INFORMATION IN THE DRAFT RED HERRING PROSPECTUS, THE BOOK RUNNING LEAD

MANAGERS ARE EXPECTED TO EXERCISE DUE DILIGENCE TO ENSURE THAT THE COMPANY

DISCHARGES ITS RESPONSIBILITY ADEQUATELY IN THIS BEHALF AND TOWARDS THIS

PURPOSE, THE BOOK RUNNING LEAD MANAGERS, HAVE FURNISHED TO SEBI, A DUE

316

DILIGENCE CERTIFICATE DATED JULY 12, 2010 WHICH READS AS FOLLOWS:

WE, THE LEAD MERCHANT BANKER(S) TO THE ABOVE MENTIONED FORTHCOMING ISSUE,

STATE AND CONFIRM AS FOLLOWS:

1. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO

LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH

COLLABORATORS, ETC. AND OTHER MATERIAL IN CONNECTION WITH THE

FINALISATION OF THE DRAFT RED HERRING PROSPECTUS (IN CASE OF A BOOK BUILT

ISSUE) / DRAFT PROSPECTUS (IN CASE OF A FIXED PRICE ISSUE) / LETTER OF OFFER (IN

CASE OF A RIGHTS ISSUE) PERTAINING TO THE SAID ISSUE;

2. ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE ISSUER, ITS

DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, AND INDEPENDENT

VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE ISSUE, PRICE

JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS AND OTHER PAPERS

FURNISHED BY THE ISSUER, WE CONFIRM THAT:

(A) THE DRAFT RED HERRING PROSPECTUS FILED WITH THE BOARD IS IN

CONFORMITY WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO

THE ISSUE;

(B) ALL THE LEGAL REQUIREMENTS RELATING TO THE ISSUE AS ALSO THE

REGULATIONS GUIDELINES, INSTRUCTIONS, ETC. FRAMED/ISSUED BY THE

BOARD, THE CENTRAL GOVERNMENT AND ANY OTHER COMPETENT

AUTHORITY IN THIS BEHALF HAVE BEEN DULY COMPLIED WITH; AND

(C) THE DISCLOSURES MADE IN THE DRAFT RED HERRING PROSPECTUS ARE TRUE,

FAIR AND ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED

DECISION AS TO THE INVESTMENT IN THE PROPOSED ISSUE AND SUCH

DISCLOSURES ARE IN ACCORDANCE WITH THE REQUIREMENTS OF THE

COMPANIES ACT, 1956, THE SECURITIES AND EXCHANGE BOARD OF INDIA

(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009

AND OTHER APPLICABLE LEGAL REQUIREMENTS.

3. WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE

DRAFT RED HERRING PROSPECTUS ARE REGISTERED WITH THE BOARD AND THAT

TILL DATE SUCH REGISTRATION IS VALID.

4. WE HAVE SATISFIED OURSELVES ABOUT THE CAPABILITY OF THE UNDERWRITERS TO

FULFIL THEIR UNDERWRITING COMMITMENTS.

5. WE CERTIFY THAT WRITTEN CONSENT FROM PROMOTERS HAS BEEN OBTAINED FOR

INCLUSION OF THEIR SPECIFIED SECURITIES AS PART OF PROMOTERS‟ CONTRIBUTION

SUBJECT TO LOCK-IN AND THE SPECIFIED SECURITIES PROPOSED TO FORM PART OF

PROMOTERS‟ CONTRIBUTION SUBJECT TO LOCK-IN SHALL NOT BE DISPOSED / SOLD /

TRANSFERRED BY THE PROMOTERS DURING THE PERIOD STARTING FROM THE DATE

OF FILING THE DRAFT RED HERRING PROSPECTUS WITH THE BOARD TILL THE DATE

OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT RED HERRING

PROSPECTUS.

6. WE CERTIFY THAT REGULATION 33 OF THE SECURITIES AND EXCHANGE BOARD OF

INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009,

WHICH RELATES TO SPECIFIED SECURITIES INELIGIBLE FOR COMPUTATION OF

PROMOTERS CONTRIBUTION, HAS BEEN DULY COMPLIED WITH AND APPROPRIATE

DISCLOSURES AS TO COMPLIANCE WITH THE SAID REGULATION HAVE BEEN MADE IN

317

THE DRAFT RED HERRING PROSPECTUS/DRAFT PROSPECTUS.

7. WE UNDERTAKE THAT SUB-REGULATION (4) OF REGULATION 32 AND CLAUSE (C) AND

(D) OF SUB-REGULATION (2) OF REGULATION 8 OF THE SECURITIES AND EXCHANGE

BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS,

2009 SHALL BE COMPLIED WITH. WE CONFIRM THAT ARRANGEMENTS HAVE BEEN

MADE TO ENSURE THAT PROMOTERS‟ CONTRIBUTION SHALL BE RECEIVED AT LEAST

ONE DAY BEFORE THE OPENING OF THE ISSUE. WE UNDERTAKE THAT AUDITORS‟

CERTIFICATE TO THIS EFFECT SHALL BE DULY SUBMITTED TO THE BOARD. WE

FURTHER CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT

PROMOTERS‟ CONTRIBUTION SHALL BE KEPT IN AN ESCROW ACCOUNT WITH A

SCHEDULED COMMERCIAL BANK AND SHALL BE RELEASED TO THE ISSUER ALONG

WITH THE PROCEEDS OF THE PUBLIC ISSUE. NOT APPLICABLE.

8. WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE ISSUER FOR WHICH THE FUNDS

ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE „MAIN OBJECTS‟ LISTED

IN THE OBJECT CLAUSE OF THE MEMORANDUM OF ASSOCIATION OR OTHER CHARTER

OF THE ISSUER AND THAT THE ACTIVITIES WHICH HAVE BEEN CARRIED OUT UNTIL

NOW ARE VALID IN TERMS OF THE OBJECT CLAUSE OF ITS MEMORANDUM OF

ASSOCIATION.

9. WE CONFIRM THAT NECESSARY ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT

THE MONEYS RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE BANK

ACCOUNT AS PER THE PROVISIONS OF SUB-SECTION (3) OF SECTION 73 OF THE

COMPANIES ACT, 1956 AND THAT SUCH MONEYS SHALL BE RELEASED BY THE SAID

BANK ONLY AFTER PERMISSION IS OBTAINED FROM ALL THE STOCK EXCHANGES

MENTIONED IN THE PROSPECTUS. WE FURTHER CONFIRM THAT THE AGREEMENT

ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE ISSUER SPECIFICALLY

CONTAINS THIS CONDITION. NOTED FOR COMPLIANCE.

10. WE CERTIFY THAT A DISCLOSURE HAS BEEN MADE IN THE DRAFT RED HERRING

PROSPECTUS THAT THE INVESTORS SHALL BE GIVEN AN OPTION TO GET THE SHARES

IN DEMAT OR PHYSICAL MODE. NOT APPLICABLE.

AS THE OFFER SIZE IS MORE THAN 10 CRORES, HENCE UNDER SECTION 68B OF THE

COMPANIES ACT, 1956, THE EQUITY SHARES ARE TO BE ISSUED IN DEMAT ONLY.

11. WE CERTIFY THAT ALL THE APPLICABLE DISCLOSURES MANDATED IN THE

SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE

REQUIREMENTS) REGULATIONS, 2009 HAVE BEEN MADE IN ADDITION TO DISCLOSURES

WHICH, IN OUR VIEW, ARE FAIR AND ADEQUATE TO ENABLE THE INVESTOR TO MAKE

A WELL INFORMED DECISION.

12. WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THE DRAFT

RED HERRING PROSPECTUS:

(A) AN UNDERTAKING FROM THE ISSUER THAT AT ANY GIVEN TIME, THERE

SHALL BE ONLY ONE DENOMINATION FOR THE EQUITY SHARES OF THE

ISSUER AND

(B) AN UNDERTAKING FROM THE ISSUER THAT IT SHALL COMPLY WITH SUCH

DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY THE BOARD FROM

TIME TO TIME.

13. WE UNDERTAKE TO COMPLY WITH THE REGULATIONS PERTAINING TO

ADVERTISEMENT IN TERMS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA

318

(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 WHILE

MAKING THE ISSUE.

14. WE ENCLOSE A NOTE EXPLAINING HOW THE PROCESS OF DUE DILIGENCE HAS BEEN

EXERCISED BY US IN VIEW OF THE NATURE OF CURRENT BUSINESS BACKGROUND OR

THE ISSUER, SITUATION AT WHICH THE PROPOSED BUSINESS STANDS, THE RISK

FACTORS, PROMOTERS EXPERIENCE, ETC.

15. WE ENCLOSE A CHECKLIST CONFIRMING REGULATION-WISE COMPLIANCE WITH

THE APPLICABLE PROVISIONS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA

(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009,

CONTAINING DETAILS SUCH AS THE REGULATION NUMBER, ITS TEXT, THE STATUS

OF COMPLIANCE, PAGE NUMBER OF THE DRAFT RED HERRING PROSPECTUS WHERE

THE REGULATION HAS BEEN COMPLIED WITH AND OUR COMMENTS, IF ANY.

The filing of the Draft Red Herring Prospectus does not, however, absolve the Company from any liabilities under

Section 63 or Section 68 of the Companies Act or from the requirement of obtaining such statutory and/or other

clearances as may be required for the purpose of the proposed issue. SEBI further reserves the right to take up at any

point of time, with the BRLMs, any irregularities or lapses in the Draft Red Herring Prospectus.

All legal requirements pertaining to the Issue will be complied with at the time of filing of the Red Herring

Prospectus with the RoC in terms of Section 60B of the Companies Act. All legal requirements pertaining to the

Issue will be complied with at the time of registration of the Prospectus with the RoC in terms of Sections 56, 60 and

60B of the Companies Act.

Caution - Disclaimer from the Company and the BRLMs

The Company, the Directors and the BRLMs accept no responsibility for statements made otherwise than in this

Draft Red Herring Prospectus or in the advertisements or any other material issued by or at our instance and anyone

placing reliance on any other source of information, including our website www.ewdpl.com, would be doing so at

his or her own risk.

The BRLMs accept no responsibility, save to the limited extent as provided in the MOU entered into between the

BRLMs, the Company and the Underwriting Agreement to be entered into between the Underwriters, the Company.

All information shall be made available by the Company and the BRLMs to the public and investors at large and no

selective or additional information would be available for a section of the investors in any manner whatsoever

including at road show presentations, in research or sales reports, at bidding centres or elsewhere.

Neither the Company nor the Syndicate is liable for any failure in downloading the Bids due to faults in any

software/hardware system or otherwise.

Investors who Bid in the Issue will be required to confirm and will be deemed to have represented to the Company,

the Underwriters and their respective directors, officers, agents, affiliates, and representatives that they are eligible

under all applicable laws, rules, regulations, guidelines and approvals to acquire Equity Shares of the Company and

will not Issue, sell, pledge, or transfer the Equity Shares of the Company to any person who is not eligible under any

applicable laws, rules, regulations, guidelines and approvals to acquire Equity Shares of the Company. The

Company, the Underwriters and their respective directors, officers, agents, affiliates, and representatives accept no

responsibility or liability for advising any investor on whether such investor is eligible to acquire Equity Shares of

the Company.

The BRLMs and their respective associates and affiliates may engage in transactions with, and perform services for,

the Company and their respective group companies, affiliates or associates or third parties in the ordinary course of

business and have engaged, or may in future engage, in commercial banking and investment banking transactions

with the Company and their respective group companies, affiliates or associates or third parties, for which they have

received, and may in future receive, compensation.

319

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

not minors, HUFs, companies, corporate bodies and societies registered under the applicable laws in India and

authorised 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 under applicable trust law and

who are authorised under their constitution to hold and invest in shares, permitted insurance companies and pension

funds) and to FIIs, Eligible NRIs and other eligible foreign investors (viz. FVCIs, multilateral and bilateral

development financial institutions). This Draft Red Herring Prospectus does not, however, constitute an invitation to

purchase shares offered hereby in any jurisdiction other than India to any person to whom it is unlawful to make an

offer or invitation in such jurisdiction. Any person into whose possession this Draft Red Herring Prospectus comes

is required to inform himself or herself about, and to observe, any such restrictions. Any dispute arising out of this

Issue will be subject to the 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 that purpose, except that this Draft Red Herring Prospectus has been filed with SEBI for its observations and

SEBI shall give its observations in due course. Accordingly, the Equity Shares represented thereby may not be

offered or sold, directly or indirectly, and this Draft Red Herring Prospectus may not be distributed, in any

jurisdiction, except in accordance with the legal requirements applicable in such jurisdiction. Neither the delivery of

this Draft Red Herring Prospectus nor any sale hereunder shall, under any circumstances, create any implication that

there has been no change in the affairs of the Company since the date hereof or that the information contained herein

is correct as of any time subsequent to this date.

The Equity Shares have not been and will not be registered under the US Securities Act of 1933 (the

“Securities Act”) or any state securities laws in the United States and may not be offered or sold within the

United States or to, or for the account or benefit of, “U.S. persons” (as defined in Regulation S under the

Securities Act), except pursuant to an exemption from, or in a transaction not subject to, the registration

requirements of the Securities Act. Accordingly, the Equity Shares are only being offered and sold (i) in the

United States to “qualified institutional buyers”, as defined in Rule 144A of the Securities Act in reliance on

Rule 144A under the Securities Act, and (ii) outside the United States to certain persons in offshore

transactions in compliance with Regulation S under the Securities Act.

The Equity Shares have not been and will not be registered, listed or otherwise qualified in any other

jurisdiction outside India and may not be offered or sold, and Bids may not be made by persons in any such

jurisdiction, except in compliance with the applicable laws of such jurisdiction.

Disclaimer Clause of BSE

As required, a copy of the Draft Red Herring Prospectus had been submitted to BSE. BSE has given vide its letter

dated [●], permission to the Company to use BSE‟s name in the Draft Red Herring Prospectus as one of the stock

exchanges on which the Company‟s further securities are proposed to be listed. BSE has scrutinised the Draft Red

Herring Prospectus for its limited internal purpose of deciding on the matter of granting the aforesaid permission to

the Company. BSE does not in any manner:

Warrant, certify or endorse the correctness or completeness of any of the contents of the Draft Red Herring

Prospectus; or

Warrant that the Company‟s securities will be listed or will continue to be listed on BSE; or

Take any responsibility for the financial or other soundness of the Company, its promoters, its management

or any scheme or project of the Company;

and it should not for any reason be deemed or construed to mean that the Draft Red Herring Prospectus has been

320

cleared or approved by BSE. Every person who desires to apply for or otherwise acquires any securities of the

Company may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim

against BSE whatsoever by reason of any loss which may be suffered by such person consequent to or in connection

with such subscription/acquisition whether by reason of anything stated or omitted to be stated herein or for any

other reason whatsoever.

Disclaimer Clause of the NSE

As required, a copy of the Draft Red Herring Prospectus had been submitted to NSE. NSE has given vide its letter

dated [●] permission to the Company to use the Exchange‟s name in this Draft Red Herring Prospectus as one of the

stock exchanges on which the Company‟s securities are proposed to be listed. NSE has scrutinised the Draft Red

Herring Prospectus for its limited internal purpose of deciding on the matter of granting the aforesaid permission to

this Company. It is to be distinctly understood that the aforesaid permission given by NSE should not in any way be

deemed or construed that the Draft Red Herring Prospectus has been cleared or approved by NSE; nor does it in any

manner warrant, certify or endorse the correctness or completeness of any of the contents of the Draft Red Herring

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 take any responsibility for the financial or other soundness of the Company, its promoters, its

management or any scheme or project of this Company.

Every person who desires to apply for or otherwise acquires any of the Company‟s securities may do so pursuant to

independent inquiry, investigation and analysis and shall not have any claim against NSE whatsoever by reason of

any loss which may be suffered by such person consequent to or in connection with such subscription/acquisition

whether by reason of anything stated or omitted to be stated herein or any other reason whatsoever.

Filing

A copy of the Draft Red Herring Prospectus has been filed with SEBI at Corporation Finance Department, Plot

No.C4-A,'G' Block, Bandra Kurla Complex, Bandra (East), Mumbai 400 051.

A copy of the Red Herring Prospectus, along with the documents required to be filed under Section 60B of the

Companies Act, would be delivered for registration to the RoC and a copy of the Prospectus to be filed under

Section 60 of the Companies Act would be delivered for registration with RoC at the Office of the Registrar of

Companies, Maharashtra, Mumbai.

Listing

Applications have been made to the Stock Exchanges for permission to deal in and for an official quotation of the

Equity Shares. [●] will be the Designated Stock Exchange with which the Basis of Allotment will be finalised.

If the permissions to deal in and for an official quotation of the Equity Shares are not granted by any of the Stock

Exchanges mentioned above, the Company will forthwith repay, without interest, all moneys received from the

applicants in pursuance of this Draft Red Herring Prospectus. If such money is not repaid within eight days after the

Company becomes liable to repay it, i.e. from the date of refusal or within seven days from the Bid/Issue Closing

Date, whichever is earlier, then the Company and every Director of the Company who is an officer in default shall,

on and from such expiry of eight days, be liable to repay the money, with interest at the rate of 15% per annum on

application money, as prescribed under Section 73 of the Companies Act.

The Company shall ensure that all steps for the completion of the necessary formalities for listing and

commencement of trading at all the Stock Exchanges mentioned above are taken within seven working days of

finalisation of the Basis of Allotment for the Issue.

Consents

Consents in writing of the Directors, the Company Secretary and Compliance Officer, the Auditors, the legal

advisors, Bankers to the Company and Bankers to the Issue, BRLMs, Syndicate Members, Escrow Collection

321

Bankers, Registrar to the Issue, and Architects, to act in their respective capacities, will be obtained and will be filed

along with a copy of the Red Herring Prospectus with the RoC, as required under Sections 60 and 60B of the

Companies Act and such consents shall not be withdrawn up to the time of delivery of the Red Herring Prospectus

for registration with the RoC.

Deloitte Haskins & Sells, Chartered Accountants, statutory auditors, have given their written consent to statement of

the tax benefits available to the Company and its members in the form and context in which it appears in this Draft

Red Herring Prospectus and such consent has not be withdrawn up to the time of submission of the Draft Red

Herring Prospectus with SEBI.

Deloitte Haskins & Sells, Chartered Accountants, statutory auditors, have given their written consent to the

inclusion of their report in the form and context in which it appears in this Draft Red Herring prospectus and such

consent and report has not been withdrawn up to the time of submission of the Draft Red Herring Prospectus with

SEBI.

Expert to the Issue

Except as stated below, the Company has not obtained any expert opinions:

[●], the IPO grading agency engaged by us for the purpose of obtaining IPO grading in respect of this Issue, have

given their written consent as experts to the inclusion of their report in the form and context in which they will

appear in the Red Herring Prospectus and such consents and reports will not be withdrawn up to the time of delivery

of the Red Herring Prospectus and the Prospectus to the Designated Stock Exchange.

The Company has obtained architect certificates dated May 31, 2010 from P.G. Patki Architects, The Design

Syndicate and Sanjay Puri Architects, Architects in relation to projects being developed by us. P.G. Patki Architects,

The Design Syndicate and Sanjay Puri Architects, Architects have given their written consent to act as experts to the

Company for the Issue in relation to the land and/or rights in respect thereof we own and such consent has not been

withdrawn up to the time of submission of the Draft Red Herring Prospectus.

Expenses of the Issue

The total expenses of the Issue are estimated to be approximately Rs. [ ] million. The expenses of this Issue include,

among others, underwriting and management fees, selling commission, printing and distribution expenses, legal

fees, statutory advertisement expenses and listing fees. All expenses with respect to the Issue would be paid by the

Company.

The estimated Issue expenses are as under:

Activity Expense*

(Rs. In Million)

Expense* (% of

total expenses)

Expense* (% of

Issue Size)

Lead merchant bankers [ ] [ ] [ ] Co-lead merchant bankers, if any [ ] [ ] [ ] Co-managers, if any [ ] [ ] [ ] Other merchant bankers [ ] [ ] [ ] Registrar to the Issue [ ] [ ] [ ] Advisors [ ] [ ] [ ] Bankers to the Issue [ ] [ ] [ ] Trustees for the debt instrument holders [ ] [ ] [ ] Underwriting commission, brokerage and selling

commission [ ] [ ] [ ]

IPO Grading Expenses [●] [●] [●]

Printing and Distribution [●] [●] [●]

Advertising and Marketing [●] [●] [●]

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Activity Expense*

(Rs. In Million)

Expense* (% of

total expenses)

Expense* (% of

Issue Size)

Others, if any (specify) [ ] [ ] [ ] Total estimated Issue expenses [ ] [ ] [ ] * Will be completed after finalisation of the Issue Price.

Fees Payable to the Syndicate

The total fees payable to the Syndicate will be as per the memorandum of understanding and the Engagement Letter

with the BRLMs, a copy of which is available for inspection at Registered Office.

Fees Payable to the Registrar to the Issue

The fees payable by the Company to the Registrar to the Issue for processing of application, data entry, printing of

CAN/refund order, preparation of refund data on magnetic tape, printing of bulk mailing register will be in terms of

the memorandum of understanding between the Company and the Registrar to the Issue dated June 16, 2010.

The Registrar to the Issue will be reimbursed for all out of pocket expenses including cost of stationery, postage,

stamp duty, and communication expenses. Adequate funds will be provided to the Registrar to the Issue to enable

them to send refund orders or Allotment advice by registered post/speed post/under certificate of posting.

Underwriting commission, brokerage and selling commission on Previous Issues

Since this is the initial public offer of the Company, no sum has been paid or has been payable as commission or

brokerage for subscribing to or procuring or agreeing to procure subscription for any of the Equity Shares since

inception of the Company.

Particulars regarding Public or Rights Issues during the last Five Years

We have not made any public or rights issues during the last five years.

Previous issues of Equity Shares otherwise than for cash

Except as stated in “Capital Structure” on page 26 of this Draft Red Herring Prospectus and “History and Corporate

Matters” on page 106 of this Draft Red Herring Prospectus, the Company has not issued any Equity Shares for

consideration otherwise than for cash.

Commission and Brokerage paid on previous issues of the Equity Shares

Since this is the initial public issue of Equity Shares, no sum has been paid or has been payable as commission or

brokerage for subscribing to or procuring or agreeing to procure subscription for any of the Equity Shares since the

Company‟s inception.

Previous capital issue during the previous three years by listed Group Companies, Subsidiaries and associates

of the Company

None of the Group Companies, associates and Subsidiaries of the Company is listed on any stock exchange.

Performance vis-à-vis objects – Public/ Rights Issue of the Company and/ or listed Group Companies,

Subsidiaries and associates of the Company

The Company has not undertaken any previous public or rights issue.

None of the Group Companies, associates and Subsidiaries of the Company is listed on any stock exchange.

323

Outstanding Debentures or Bonds

Except as mentioned in the section “Capital Structure” on page 26 of this Draft Red Herring Prospectus, the

Company does not have any outstanding debentures or bonds as of the date of filing this Draft Red Herring

Prospectus.

Outstanding Preference Shares

The Company does not have any outstanding preference shares other than those mentioned in “Capital Structure” on


Stock Market Data of Equity Shares

This being an initial public issue of the Company, the Equity Shares are not listed on any stock exchange.

Mechanism for Redressal of Investor Grievances

The agreement between the Registrar to the Issue, the Company will provide for retention of records with the

Registrar to the Issue for a period of at least one year from the last date of despatch of the letters of allotment, demat

credit and refund orders to enable the investors to approach the Registrar to the Issue for redressal of their

grievances.

All grievances relating to the Issue may be addressed to the Registrar to the Issue, giving full details such as name,

address of the applicant, number of Equity Shares applied for, amount paid on application and the bank branch or

collection centre where the application was submitted.

All grievances relating to the ASBA process may be addressed to the SCSB, giving full details such as name,

address of the applicant, application number, number of Equity Shares applied for, amount paid on application and

the Designated Branch or the collection centre of the SCSB where the ASBA Bid cum Application Form was

submitted by the ASBA Bidders.

Disposal of Investor Grievances

The Company estimates that the average time required by the Company, or the Registrar to the Issue for the

redressal of routine investor grievances shall be 10 working days from the date of receipt of the complaint. In case of

non-routine complaints and complaints where external agencies are involved, the Company will seek to redress

these complaints as expeditiously as possible.

The Company has appointed a Shareholders‟/Investors‟ Grievance Committee comprising Suhail Nathani, Homi

Aibara, Manish Kalani and B. Rajesh Nair as members.

We have also appointed Bimal K. Nanda, Company Secretary of the Company as the Compliance Officer for this

Issue and he may be contacted in case of any pre-Issue or post-Issue related problems, at the following address:

Bimal K. Nanda





Mahalaxmi, Mumbai 400 011

Maharashtra

Tel: (91 22) 4045 0555

Fax: (91 22) 4045 0512


324

Changes in Auditors in the last three years

Date Name of the auditor Reason for change

April 2, 2007 M. Munshi & Co. Resignation

June 27, 2007 Deloitte Haskins and Sells Appointed

Capitalisation of Reserves or Profits

Except as disclosed in this Draft Red Herring Prospectus, we have not capitalised the reserves or profits at any time

during the last five years.

Revaluation of Assets

The Company has not revalued its assets in the last five years.

325

SECTION VII: ISSUE INFORMATION

TERMS OF THE ISSUE

The Equity Shares being issued are subject to the provisions of the Companies Act, the Memorandum and Articles

of Association, the terms of this Draft Red Herring Prospectus, the Red Herring Prospectus and the Prospectus, Bid

cum Application Form, ASBA Bid cum Application Form, the Revision Form, the CAN and other terms and

conditions as may be incorporated in the Allotment advices and other documents/ certificates that may be executed

in respect of the Issue. The Equity Shares shall also be subject to laws, guidelines, notifications and regulations

relating to the issue of capital and listing and trading of securities issued from time to time by SEBI, the

Government, Stock Exchanges, RoC, RBI and/or other authorities, as in force on the date of the Issue and to the

extent applicable.

Ranking of Equity Shares

The Equity Shares being issued shall be subject to the provisions of the Memorandum and Articles of Association

and shall rank pari passu with the existing Equity Shares of the Company including rights in respect of dividend.

The Allotees in receipt of Allotment of Equity Shares under this Issue will be entitled to dividends and other

corporate benefits, if any, declared by the Company after the date of Allotment. For further details, see “Main

Provisions of the Articles of Association” on page 365 of this Draft Red Herring Prospectus.

Mode of Payment of Dividend

The Company shall pay dividends to its shareholders in accordance with the provisions of the Companies Act.

Face Value and Issue Price

The face value of the Equity Shares is Rs. 10 each and the Issue Price is Rs. [ ] per Equity Share. The Anchor

Investor Issue Price is Rs. [●] per Equity Share.

At any given point of time there shall be only one denomination for the Equity Shares.

Compliance with SEBI Regulations

The Company shall comply with all disclosure and accounting norms as specified by SEBI from time to time.

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 rights shares and be allotted bonus shares, if announced;

Right to receive surplus on liquidation;

Right of free transferability; and

Such other rights, as may be available to a shareholder of a listed public company under the Companies

Act, the terms of the listing agreement executed with the Stock Exchanges, and the Company‟s

Memorandum and Articles of Association.

326

For a detailed description of the main provisions of the Articles relating to voting rights, dividend, forfeiture and lien

and/or consolidation/splitting, see “Main Provisions of the Articles of Association” on page 365 of this Draft Red

Herring Prospectus.

Market Lot and Trading Lot

In terms of Section 68B of the Companies Act, the Equity Shares shall be Allotted only in dematerialised form. As

per the SEBI Regulations, the trading of the Equity Shares shall only be in dematerialised form. Since trading of the

Equity Shares is in dematerialised form, the tradable lot is one Equity Share. Allotment in this Issue will be only in

electronic form in multiples of one (1) Equity Share subject to a minimum Allotment of [ ] Equity Shares.

The Price Band and the minimum Bid Lot size for the Issue will be decided by the Company in consultation with the

BRLMs and advertised in [●] edition of English national daily [●], [●] edition of Hindi national daily [●], and [●]

edition of regional language newspaper [●] at least two days prior to the Bid/ Issue Opening Date.

Jurisdiction

Exclusive jurisdiction for the purpose of this Issue is with the competent courts/authorities in Mumbai.

Nomination Facility to Investor

In accordance with Section 109A of the Companies Act, the sole or first Bidder, along with other joint Bidders, may

nominate any one person in whom, in the event of the death of sole Bidder or in case of joint Bidders, death of all

the Bidders, as the case may be, the Equity Shares Allotted, if any, shall vest. A person, being a nominee, entitled to

the Equity Shares by reason of the death of the original holder(s), shall in accordance with Section 109A of the

Companies Act, be entitled to the same advantages to which he or she would be entitled if he or she were the

registered holder of the Equity Share(s). Where the nominee is a minor, the holder(s) may make a nomination to

appoint, in the prescribed manner, any person to become entitled to Equity Share(s) in the event of his or her death

during the minority. A nomination shall stand rescinded upon a sale of equity share(s) by the person nominating. A

buyer will be entitled to make a fresh nomination in the manner prescribed. Fresh nomination can be made only on

the prescribed form available on request at the Registered Office/ Corporate Office of the Company or to the

Registrar and Transfer Agents of the Company.

In accordance with Section 109B of the Companies Act, any Person who becomes a nominee by virtue of Section

109A of the Companies Act, shall upon the production of such evidence as may be required by the Board, elect

either:

To register himself or herself as the holder of the Equity Shares; or

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 choose either to be registered himself or

herself or to transfer the Equity Shares, and if the notice is not complied with within a period of ninety days, the

Board may thereafter withhold payment of all dividends, bonuses or other moneys payable in respect of the Equity

Shares, until the requirements of the notice have been complied with.

Since the Allotment of Equity Shares in the Issue will be made only in dematerialised form, there is no need to make

a separate nomination with the Company. Nominations registered with respective depository participant of the

applicant would prevail. If the investors require changing their nomination, they are requested to inform their

respective depository participant.

Minimum Subscription

If the Company does not receive the minimum subscription of 90% of the Issue, including devolvement of

327

underwriters within 60 days from the Bid/Issue Closing Date, the Company shall forthwith refund the entire

subscription amount received. If there is a delay beyond eight days after the Company becomes liable to pay the

amount, the Company shall pay interest as prescribed under Section 73 of the Companies Act.

If at least 50% of the Issue cannot be allotted to QIBs, then the entire application money will be refunded forthwith.

Further, the Company shall ensure that the number of prospective Allotees to whom Equity Shares will be Allotted

shall not be less than 1,000.



jurisdiction.

Arrangement for disposal of Odd Lots

There are no arrangements for disposal of odd lots.

Restriction on transfer of shares

Except for lock-in of the pre-Issue Equity Shares, Promoters‟ minimum contribution and Anchor Investor lock-in in

the Issue as detailed in “Capital Structure” on page 26 of this Draft Red Herring Prospectus, and except as provided

in the Articles of Association, there are no restrictions on transfers of Equity Shares. There are no restrictions on

transfers of debentures except as provided in the Articles of Association. There are no restrictions on transmission of

shares/ debentures and on their consolidation/ splitting except as provided in the Articles of Association. See “Main

Provisions of the Articles of Association” on page 365 of this Draft Red Herring Prospectus.

328

ISSUE STRUCTURE

Issue of 38,928,943 Equity Shares for cash at a price of Rs. [●] per Equity Share (including share premium of Rs.

[●] per Equity Share) aggregating to Rs. [●] million. The Issue will constitute 30% of the post-Issue paid-up

capital of the Company.

The Issue is being made through the 100% Book Building Process.

QIBs(1)

Non-Institutional

Bidders

Retail Individual

Bidders

Number of Equity

Shares(2)

At least 19,464,472 Equity Shares Not less than

5,839,341 Equity

Shares available for

allocation or Issue less

allocation to QIB

Bidders and Retail

Individual Bidders.

Not less than

13,625,130

Equity Shares

available for allocation

or Issue less allocation

to QIB Bidders and

Non-Institutional

Bidders.

Percentage of Issue

Size available for

Allotment/allocation

At least 50% of the Issue Size being

allocated. However, up to 5% of the

QIB Portion (excluding the Anchor

Investor Portion if any) shall be

available for allocation proportionately

to Mutual Funds only.

Not less than 15% of

Issue or the Issue less

allocation to QIB

Bidders and Retail

Individual Bidders.

Not less than 35% of

the Issue or the Issue

less allocation to QIB

Bidders and Non-

Institutional Bidders.

Basis of

Allotment/allocation if

respective category is

oversubscribed

Proportionate as follows:

(a) 681,257 Equity Shares shall be

allocated on a proportionate basis to

Mutual Funds only; and

(b) 12,943,873 Equity Shares shall be

allocated on a proportionate basis to

all QIBs including Mutual Funds

receiving allocation as per (a) above.

Proportionate Proportionate

Minimum Bid Such number of Equity Shares that

the Bid Amount exceeds Rs. 100,000

and in multiples of [●] Equity Shares

thereafter.

Such number of

Equity Shares that the

Bid Amount exceeds

Rs. 100,000 and in

multiples of [●]

Equity Shares

thereafter.

[●] Equity Shares and

in multiples of [●]

Equity Shares

thereafter

Maximum Bid Such number of Equity Shares not

exceeding the Issue, subject to

applicable limits.

Such number of

Equity Shares not

exceeding the Issue

subject to applicable

limits.

Such number of

Equity Shares

whereby the Bid

Amount does not

exceed Rs. 100,000.

Mode of Allotment Compulsorily in dematerialised form.

Compulsorily in

dematerialised form.

Compulsorily in

dematerialised form.

Bid Lot [●] Equity Shares and in multiples of

[●] Equity Shares thereafter.



Equity Shares

thereafter.



Equity Shares

thereafter.

329

QIBs(1)

Non-Institutional

Bidders

Retail Individual

Bidders

Allotment Lot [●] Equity Shares and in multiples of

one Equity Share thereafter


in multiples of one

Equity Share

thereafter


in multiples of one

Equity Share

thereafter

Trading Lot One Equity Share One Equity Share

One Equity Share

Who can Apply (3)

Public financial institutions as

specified in Section 4A of the

Companies Act, scheduled commercial

banks, mutual funds registered with

SEBI, FIIs and sub-accounts registered

with SEBI, other than a sub-account

which is a foreign corporate or foreign

individual, venture capital funds

registered with SEBI, state industrial

development corporations, insurance

companies registered with Insurance

Regulatory and Development

Authority, provident funds (subject to

applicable law) with minimum corpus

of Rs. 250 million, pension funds with

minimum corpus of Rs. 250 million in

accordance with applicable law, and

National Investment Fund and

insurance funds set up and managed

by army, navy or air force of the

Union of India.

Resident Indian

individuals, Eligible

NRIs, HUF (in the

name of Karta),

companies, corporate

bodies, scientific

institutions societies

and trusts,

sub-accounts of FIIs

registered with SEBI,

which are foreign

corporates or foreign

individuals.

Resident Indian

individuals, Eligible

NRIs and HUF (in the

name of Karta)

Terms of Payment Amount shall be payable at the time of

submission of Bid cum Application

Form to the Syndicate Members

(except for Anchor Investors).(4)

Amount shall be

payable at the time of

submission of Bid

cum Application

Form.(4)

Amount shall be

payable at the time of

submission of Bid

cum Application

Form.(4)

Margin Amount Full Bid Amount on bidding

Full Bid Amount on

bidding

Full Bid Amount on

bidding

(1) The Company may allocate up to 30% of the QIB Portion to Anchor Investors on a discretionary basis. One-third of the Anchor Investor

Portion shall be reserved for domestic Mutual Funds, subject to valid Bids being received from domestic Mutual Funds at or above the price at which allocation is being done to Anchor Investors. For further details, see “Issue Procedure” on page 332 of this Draft Red

Herring Prospectus.

(2) Subject to valid Bids being received at or above the Issue Price. This Issue is being made in accordance with Rule 19(2)(b)(i) of the SCRR,

as amended under the SEBI Regulations, where the Issue will be made through the 100% Book Building Process wherein at least 50% of

the Issue will be allocated on a proportionate basis to QIBs. Out of the QIB Portion (excluding the Anchor Investor Portion), 5% shall be available for allocation on a proportionate basis to Mutual Funds only. The remainder shall be available for allocation on a proportionate

basis to QIBs and Mutual Funds, subject to valid Bids being received from them at or above the Issue Price. If at least 50% of the Issue

cannot be allotted to QIBs, then the entire application money will be refunded forthwith. However, if the aggregate demand from Mutual Funds is less than 681,257 Equity Shares, the balance Equity Shares available for Allotment in the Mutual Fund Portion will be added to

the QIB Portion and allocated proportionately to the QIB Bidders in proportion to their Bids. Further, not less than 15% of the Issue will

be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Issue will be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid Bids being received at or above the Issue Price.

Under-subscription, if any, in any category except in the QIB category would be met with spill-over from other categories at sole discretion of the Company, in consultation with the BRLMs and the Designated Stock Exchange.

(3) In case the Bid cum Application Form is submitted in joint names, the Bidders should ensure that the demat account is also held in the same

330

joint names and are in the same sequence in which they appear in the Bid cum Application Form.

(4) In case of ASBA Bidders, the SCSB shall be authorised to block such funds in the bank account of the ASBA Bidder that are specified in the

ASBA Bid cum Application Form.

Withdrawal of the Issue

The Company, in consultation with the BRLMs, reserves the right not to proceed with the Issue anytime after the

Bid/Issue Opening Date but before the Allotment of Equity Shares. In such an event the Company would issue a

public notice in the newspapers, in which the pre-Issue advertisements were published, within two days of the Bid/

Issue Closing Date, providing reasons for not proceeding with the Issue. The BRLMs, through the Registrar to the

Issue, shall notify the SCSBs to unblock the bank accounts of the ASBA Bidders within one day from the day of

receipt of such notification. The Company shall also inform the same to Stock Exchanges on which the Equity

Shares are proposed to be listed.

Any further issue of Equity Shares by the Company shall be in compliance with applicable laws.

Bid/ Issue Programme

BID/ISSUE OPENS ON [●]*

BID/ISSUE CLOSES ON [●]**

* The Company may consider participation by Anchor Investors. The Anchor Investor Bid/ Issue Period shall be one working day prior to the Bid/

Issue Opening Date. ** The Company may consider closing the Bid/Issue Period for QIB Bidders one day prior to the Bid/Issue Closing Date.

Bids and any revision in Bids shall be accepted only between 10.00 a.m. and 5.00 p.m. (Indian Standard Time,

“IST”) during the Bid/ Issue Period as mentioned above at the bidding centres mentioned on the Bid cum

Application Form. On the Bid/ Issue Closing Date, the Bids shall be accepted only between 10.00 a.m. and 3.00

p.m. (IST) and shall be uploaded until (i) 4.00 p.m. (IST) in case of Bids by QIB Bidders and Non-Institutional

Bidders, and (ii) until 5.00 p.m. (IST) or such extended time as permitted by the Stock Exchanges, in case of Bids by

Retail Individual Bidders. It is clarified that the Bids not uploaded in the book would be rejected. Bids by the ASBA

Bidders shall be uploaded by the SCSB in the electronic system to be provided by the Stock Exchanges.

In case of discrepancy in the data entered in the electronic book vis-à-vis the data contained in the physical Bid cum

Application Form, for a particular Bidder, the details as per the physical Bid cum Application Form of the Bidder

may be taken as the final data for the purpose of Allotment.

Due to limitation of time available for uploading the Bids on the Bid/ Issue Closing Date, the Bidders are advised to

submit their Bids one day prior to the Bid/ Issue Closing Date and, in any case, no later than 3.00 p.m. (IST) on the

Bid/ Issue Closing Date. All times mentioned in the Red Herring Prospectus are Indian Standard Time. Bidders are

cautioned that in the event a large number of Bids are received on the Bid/ Issue Closing Date, as is typically

experienced in public offerings, some Bids may not get uploaded due to lack of sufficient time. Such Bids that

cannot be uploaded will not be considered for allocation under the Issue. Bids will be accepted only on Business

Days, i.e., Monday to Friday (excluding any public holiday).

On the Bid/ Issue Closing Date, extension of time will be granted by the Stock Exchanges only for uploading the

Bids received by Retail Individual Bidders after taking into account the total number of Bids received up to the

closure of time period for acceptance of Bid cum Application Forms as stated herein and reported by the BRLMs to

the Stock Exchanges within half an hour of such closure.

The Company, in consultation with the BRLMs, reserves the right to revise the Price Band during the Bid/ Issue

Period, provided that the Cap Price shall be less than or equal to 120% of the Floor Price and the Floor Price shall

not be less than the face value of the Equity Shares. The revision in Price Band shall not exceed 20% on the either

side i.e. the floor price can move up or down to the extent of 20% of the floor price and the Cap Price will be revised

accordingly.

331

In case of revision of the Price Band, the Bid/Issue Period will be extended for three additional Working Days

after revision of Price Band subject to the Bid/Issue Period not exceeding 10 Working Days. Any revision in

the Price Band and the revised Bid/Issue Period, if applicable, will be widely disseminated by notification to

the Stock Exchanges, by issuing a press release and also by indicating the changes on the web site of the

BRLMs and at the terminals of the Syndicate.

332

ISSUE PROCEDURE

This section applies to all Bidders. Please note that all Bidders other than Anchor Investors can participate in the

Issue through the ASBA process. ASBA Bidders should note that the ASBA process involves application procedures

that are different from the procedure applicable to Bidders other than the ASBA Bidders. Bidders applying through

the ASBA process should carefully read the provisions applicable to such applications before making their

application through the ASBA process. Please note that all the Bidders are required to make payment of the full Bid

Amount along with the Bid cum Application Form.

Book Building Procedure

This Issue is being made through the 100% Book Building Process wherein at least 50% of the Issue will be

allocated to QIBs on a proportionate basis. Out of the QIB Portion (excluding the Anchor Investor Portion), 5%

shall be available for allocation on a proportionate basis to Mutual Funds only. The remainder shall be available for

allocation on a proportionate basis to QIBs and Mutual Funds, subject to valid Bids being received from them at or

above the Issue Price. If at least 50% of the Issue cannot be allotted to QIBs, then the entire application money will

be refunded forthwith. Further, not less than 15% of the Issue will be available for allocation on a proportionate

basis to Non-Institutional Bidders and not less than 35% of the Issue will be available for allocation on a

proportionate basis to Retail Individual Bidders, subject to valid Bids being received at or above the Issue Price.

Allocation to Anchor Investors shall be on a discretionary basis and not on a proportionate basis.

All Bidders other than the ASBA Bidders are required to submit their Bids through the Syndicate. ASBA Bidders

are required to submit their Bids to the SCSBs.

Investors should note that the Equity Shares will be Allotted to all successful Bidders only in dematerialised form.

The Bid cum Application Forms which do not have the details of the Bidders‟ depository account shall be treated as

incomplete and rejected. Bidders will not have the option of being Allotted Equity Shares in physical form. The

Equity Shares on Allotment shall be traded only in the dematerialised segment of the Stock Exchanges.

Bid cum Application Form

The prescribed colour of the Bid cum Application Form for the various categories is as follows:

Category Colour of Bid cum

Application Form

Resident Indians and Eligible NRIs applying on a non-repatriation basis (ASBA as

well as non ASBA Bidders)

[●]

Eligible NRIs and FIIs applying on a repatriation basis (ASBA as well as non ASBA

Bidders)

[●]

Anchor Investors* [●]

*Bid cum Application forms for Anchor Investors have been made available at the offices of the BRLMs.

Bidders (other than ASBA Bidders) are required to submit their Bids through the Syndicate. Such Bidders shall only

use the specified Bid cum Application Form bearing the stamp of a member of the Syndicate for the purpose of

making a Bid in terms of the Red Herring Prospectus. The Bidder shall have the option to make a maximum of three

Bids in the Bid cum Application Form and such options shall not be considered as multiple Bids.

ASBA Bidders shall submit an ASBA Bid cum Application Form either in physical or electronic form to the SCSB

authorising blocking of funds that are available in the bank account specified in the ASBA Bid cum Application

Form only. Only QIBs can participate in the Anchor Investor Portion and such Anchor Investors cannot submit their

Bids through the ASBA process.

Upon the filing of the Prospectus with the RoC, the Bid cum Application Form shall be considered as the

Application Form. Upon completion and submission of the Bid cum Application Form to a Syndicate or the SCSB,

the Bidder or the ASBA Bidder is deemed to have authorised the Company to make the necessary changes in the

333

Red Herring Prospectus as would be required for filing the Prospectus with the RoC and as would be required by

RoC after such filing, without prior or subsequent notice of such changes to the Bidder or the ASBA Bidder.

Who can Bid?

Indian nationals resident in India who are not minors in single or joint names (not more than three);

Hindu Undivided Families or HUFs, in the individual name of the Karta. The Bidder should specify that

the Bid is being made in the name of the HUF in the Bid cum Application Form as follows: “Name of

Sole or First bidder: XYZ Hindu Undivided Family applying through XYZ, where XYZ is the name of the

Karta”. Bids by HUFs would be considered at par with those from individuals;

Companies, corporate bodies and societies registered under the applicable laws in India and authorised to

invest in equity shares;

Mutual Funds registered with SEBI;

Eligible NRIs on a repatriation basis or on a non repatriation basis subject to applicable laws. NRIs other

than eligible NRIs are not eligible to participate in this issue;

Indian financial institutions, commercial banks (excluding foreign banks), regional rural banks, co-

operative banks (subject to RBI regulations and the SEBI Regulations and other laws, as applicable);

FIIs and sub-accounts registered with SEBI, other than a sub-account which is a foreign corporate or

foreign individual;

Sub-accounts of FIIs registered with SEBI, which are foreign corporates or foreign individuals only under

the Non-Institutional Bidders category.

Venture Capital Funds registered with SEBI;

Multilateral and bilateral development financial institutions;

State Industrial Development Corporations;

Trusts/societies registered under the Societies Registration Act, 1860, as amended, or under any other law

relating to trusts/societies and who are authorised under their respective constitutions to hold and invest in

equity shares;

Scientific and/or industrial research organisations authorised to invest in equity shares;

Insurance Companies registered with Insurance Regulatory and Development Authority;

Provident Funds with a minimum corpus of Rs. 250 million and who are authorised under their constitution

to hold and invest in equity shares;

Pension Funds with a minimum corpus of Rs. 250 million and who are authorised under their constitution

to hold and invest in equity shares;

National Investment Fund; and

Insurance funds set up and managed by the army, navy or air force of the Union of India.

As per the existing regulations, OCBs cannot participate in this Issue.

Participation by associates and affiliates of the BRLMs and the Syndicate Members

The BRLMs and the Syndicate Members shall not be allowed to subscribe to this Issue in any manner except

towards fulfilling their underwriting obligations. However, the associates and affiliates of the BRLMs and Syndicate

Members may subscribe to or purchase Equity Shares in the Issue, either in the QIB Portion or in Non-Institutional

Portion as may be applicable to such Bidders, where the allocation is on a proportionate basis.

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The BRLMs and any persons related to the BRLMs or the Promoter and the Promoter Group cannot apply in the

Issue under the Anchor Investor Portion.

Bids by Mutual Funds

An eligible Bid by a Mutual Fund shall first be considered for allocation proportionately in the Mutual Fund Portion.

In the event that the demand is greater than [●] Equity Shares, allocation shall be made to Mutual Funds

proportionately, to the extent of the Mutual Fund Portion. The remaining demand by the Mutual Funds shall, as part

of the aggregate demand by QIBs, be available for allocation proportionately out of the remainder of the QIB

Portion, after excluding the allocation in the Mutual Fund Portion.

One-third of the Anchor Investor Portion shall be reserved for domestic Mutual Funds, subject to valid Bids being

received from domestic Mutual Funds at or above the price at which allocation is being done to other Anchor

Investors.

In case of a Mutual Fund, a separate Bid can be made in respect of each scheme of the Mutual Fund

registered with SEBI and such Bids in respect of more than one scheme of the Mutual Fund will not be

treated as multiple Bids provided that the Bids clearly indicate the scheme concerned for which the Bid has

been made.

No mutual fund scheme shall invest more than 10% of its net asset value in equity shares or equity related

instruments of any single company provided that the limit of 10% shall not be applicable for investments in

index funds or sector or industry specific funds. No Mutual Fund under all its schemes should own more than

10% of any company‟s paid-up share capital carrying voting rights.

Bids by Eligible NRIs

1. Bid cum Application Forms have been made available for Eligible NRIs at the Registered Office, with the

Syndicate and the Registrar to the Issue.

2. Eligible NRIs applicants should note that only such applications as are accompanied by payment in free

foreign exchange shall be considered for Allotment. Eligible NRIs who intend to make payment through

Non-Resident Ordinary (NRO) accounts should use the form meant for Resident Indians.

Bids by FIIs

As per the current regulations, the following restrictions are applicable for investments by FIIs:

The issue of Equity Shares to a single FII should not exceed 10% of total post-Issue paid-up share capital (i.e. 10%

of 129,763,143 Equity Shares). In respect of an FII investing in our Equity Shares on behalf of its sub-accounts, the

investment on behalf of each sub-account shall not exceed 10% of our total paid-up share capital or 5% of our total

paid-up share capital in case such sub-account is a foreign corporate or a foreign individual. As of now, the

aggregate FII holding in the Company cannot exceed 24% of the total issued capital. With the approval of the board

and the shareholders by way of a special resolution, the aggregate FII holding can go up to 100%. The Board and

shareholders of the Company through the resolutions dated January 21, 2010 and January 22, 2010 respectively have

increased the limit for FII shareholding in the Company up to 49% of the total issued capital.

Subject to compliance with all applicable Indian laws, rules, regulations guidelines and approvals in terms of

regulation 15A(1) of the Securities Exchange Board of India (Foreign Institutional Investors) Regulations 1995, as

amended (the “SEBI FII Regulations”), an FII, as defined in the SEBI FII Regulations, deal or hold, offshore

derivative instruments (as defined under the SEBI FII Regulations as any instrument, by whatever name called,

which is issued overseas by a FII against securities held by it that are listed or proposed to be listed on any

recognised stock exchange in India, as its underlying) directly or indirectly, only in the event (i) such offshore

derivative instruments are issued only to persons who are regulated by an appropriate regulatory authority; and (ii)

such offshore derivative instruments are issued after compliance with „know your client‟ norms. An FII is also

required to ensure that no further issue or transfer of any offshore derivative instrument is made by or on behalf of it

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to any persons that are not regulated by an appropriate foreign regulatory authority as defined under the SEBI FII

Regulations. Associates and affiliates of the underwriters including the BRLMs and the Syndicate Members that are

FIIs may issue offshore derivative instruments against Equity Shares Allotted to them in the Issue. Any such

Offshore Derivative Instrument does not constitute any obligation or claim or claim on or an interest in the

Company.

Bids by SEBI registered Venture Capital Funds and

The SEBI (Venture Capital Funds) Regulations, 1996 inter alia prescribe the investment restrictions on venture

capital funds registered with SEBI.

Accordingly, the holding by any individual venture capital fund registered with SEBI in one company should not

exceed 25% of the corpus of the venture capital fund. Further, venture capital funds can invest only up to 33.33% of

the investible funds by way of subscription to an IPO of a venture capital undertaking whose shares are proposed to

be listed.

The above information is given for the benefit of the Bidders. The Company, the BRLMs are not liable for

any amendments or modification or changes in applicable laws or regulations, which may occur after the date

of this Draft Red Herring Prospectus. Bidders are advised to make their independent investigations and

Bidders are advised to ensure that any single Bid from them does not exceed the investment limits or

maximum number of Equity Shares that can be held by them under applicable law or regulation or as

specified in this Draft Red Herring Prospectus.

Maximum and Minimum Bid Size

(a) For Retail Individual Bidders: The Bid must be for a minimum of [ ] Equity Shares and in multiples of

[ ] Equity Share thereafter, so as to ensure that the Bid Amount payable by the Bidder does not exceed Rs.

100,000. In case of revision of Bids, the Retail Individual Bidders have to ensure that the Bid Amount does

not exceed Rs. 100,000. In case the Bid Amount is over Rs. 100,000 due to revision of the Bid or revision

of the Price Band or on exercise of Cut-off Price option, the Bid would be considered for allocation under

the Non-Institutional Portion. The Cut-off Price option is an option given only to the Retail Individual

Bidders indicating their agreement to Bid and purchase at the final Issue Price as determined at the end of

the Book Building Process.

(b) For Other Bidders (Non-Institutional Bidders and QIBs): The Bid must be for a minimum of such

number of Equity Shares such that the Bid Amount exceeds Rs. 100,000 and in multiples of [ ] Equity

Shares thereafter. A Bid cannot be submitted for more than the Issue Size. However, the maximum Bid by

a QIB investor should not exceed the investment limits prescribed for them by applicable laws. A QIB

Bidder cannot withdraw its Bid after the Bid/Issue Closing Date and is required to pay the Bid

Amount upon submission of the Bid.

In case of revision in Bids, the Non-Institutional Bidders, who are individuals, have to ensure that the Bid

Amount is greater than Rs. 100,000 for being considered for allocation in the Non-Institutional Portion. In

case the Bid Amount reduces to Rs. 100,000 or less due to a revision in Bids or revision of the Price Band,

Bids by Non-Institutional Bidders who are eligible for allocation in the Retail Portion would be considered

for allocation under the Retail Portion. Non-Institutional Bidders and QIBs are not allowed to Bid at „Cut-

off Price‟.

(c) For Bidders in the Anchor Investor Portion: The Bid must be for a minimum of such number of Equity

Shares such that the Bid Amount exceeds Rs. 100 million and in multiples of [ ] Equity Shares thereafter.

Bids by Anchor Investors under the Anchor Investor Portion and the QIB Portion shall not be considered as

multiple Bids. A Bid cannot be submitted for more than 30% of the QIB Portion under the Anchor Investor

Portion. Anchor Investors cannot withdraw their Bids after the Anchor Investor Bid/ Issue Period

and are required to pay the Bid Amount at the time of submission of the Bid. In case the Anchor

Investor Issue Price is lower than the Issue Price, the balance amount shall be payable as per the pay-

in date mentioned in the revised Anchor Investor Allocation Notice.

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Information for the Bidders:

(a) The Company, the BRLMs shall declare the Bid/Issue Opening Date and Bid/Issue Closing Date in the Red

Herring Prospectus to be registered with the RoC and also publish the same in two national newspapers

(one each in English and Hindi) and in one regional newspaper with wide circulation. This advertisement

shall be in the prescribed format.

(b) The Company will file the Red Herring Prospectus with the RoC at least three days before the Bid/Issue

Opening Date.

(c) Copies of the Bid cum Application Form and copies of the Red Herring Prospectus will be available with

the Syndicate. The SCSBs shall ensure that the abridged prospectus is made available on their websites.

(d) Any Bidders (who is eligible to invest in the Equity Shares) who would like to obtain the Red Herring

Prospectus and/ or the Bid cum Application Form can obtain the same from the Registered Office of the

Company.

(e) Eligible Bidders who are interested in subscribing for the Equity Shares should approach any of the

BRLMs or Syndicate Members or their authorised agent(s) to register their Bids. Bidders (other than ASBA

Bidders) who wish to use the ASBA process should approach the Designated Branches of the SCSBs to

register their Bids.

(f) The Bids should be submitted on the prescribed Bid cum Application Form only. Bid cum Application

Forms (other than the ASBA Bid cum Application Forms) should bear the stamp of the Syndicate,

otherwise they will be rejected. Bids by ASBA Bidders shall be accepted by the Designated Branches of

the SCSBs in accordance with the SEBI Regulations and any circulars issued by SEBI in this regard.

Bidders (other than Anchor Investors) applying through the ASBA process also have an option to submit

the ASBA Bid cum Application Form in electronic form.

The applicants may note that in case the DP ID and Client ID and PAN mentioned in the Bid cum

Application Form and entered into the electronic bidding system of the Stock Exchanges by the

Syndicate do not match with the DP ID and Client ID and PAN available in the Settlement

Depository database, the application is liable to be rejected.

Method and Process of Bidding

(a) The Company in consultation with the BRLMs will decide the Price Band and the minimum Bid lot size for

the Issue and the same shall be advertised in two national newspapers (one each in English and Hindi) and

in one regional newspaper with wide circulation at least two Working Days prior to the Bid/ Issue Opening

Date. The Syndicate and the SCSBs shall accept Bids from the Bidders during the Bid/Issue Period.

(b) The Bid/Issue Period shall be for a minimum of three Working Days and shall not exceed 10 Working

Days. The Bid/ Issue Period maybe extended, if required, by an additional three Working Days, subject to

the total Bid/Issue Period not exceeding 10 Working Days. Any revision in the Price Band and the revised

Bid/ Issue Period, if applicable, will be published in two national newspapers (one each in English and

Hindi) and one regional newspaper with wide circulation and also by indicating the change on the websites

of the BRLMs and at the terminals of the Syndicate.

(c) During the Bid/Issue Period, Bidders, other than QIBs, who are interested in subscribing for the Equity

Shares should approach the Syndicate or their authorised agents to register their Bids. The Syndicate shall

accept Bids from all Bidders and have the right to vet the Bids during the Bid/ Issue Period in accordance

with the terms of the Red Herring Prospectus. Bidders (other than Anchor Investors) who wish to use the

ASBA process should approach the Designated Branches of the SCSBs to register their Bids.

(d) Each Bid cum Application Form will give the Bidder the choice to Bid for up to three optional prices (for

details refer to the paragraph entitled “Bids at Different Price Levels” below) within the Price Band and

337

specify the demand (i.e., the number of Equity Shares Bid for) in each option. The price and demand

options submitted by the Bidder in the Bid cum Application Form will be treated as optional demands from

the Bidder and will not be cumulated. After determination of the Issue Price, the maximum number of

Equity Shares Bid for by a Bidder at or above the Issue Price will be considered for allocation/Allotment

and the rest of the Bid(s), irrespective of the Bid Amount, will become automatically invalid.

(e) The Bidder cannot Bid on another Bid cum Application Form after Bids on one Bid cum Application Form

have been submitted to any member of the Syndicate or the SCSBs. Submission of a second Bid cum

Application Form to either the same or to another member of the Syndicate or SCBS will be treated as

multiple Bids and is liable to be rejected either before entering the Bid into the electronic bidding system,

or at any point of time prior to the allocation or Allotment of Equity Shares in this Issue. However, the

Bidder can revise the Bid through the Revision Form, the procedure for which is detailed under the

paragraph entitled “Build up of the Book and Revision of Bids”.

(f) Except in relation to the Bids received from the Anchor Investors, the Syndicate/the SCSBs will enter each

Bid option into the electronic bidding system as a separate Bid and generate a Transaction Registration

Slip, (“TRS”), for each price and demand option and give the same to the Bidder. Therefore, a Bidder can

receive up to three TRSs for each Bid cum Application Form.

(g) The BRLMs shall accept the Bids from the Anchor Investors during the Anchor Investor Bid/ Issue Period

i.e. one Working Day prior to the Bid/ Issue Opening Date. Bids by QIBs under the Anchor Investor

Portion and the QIB Portion shall not be considered as multiple Bids.

(h) Along with the Bid cum Application Form, all Bidders (other than ASBA Bidders) will make payment in

the manner described in “Issue Procedure - Escrow Mechanism, terms of payment and payment into the

Escrow Accounts” on page 338 of this Draft Red Herring Prospectus.

(i) Upon receipt of the ASBA Bid cum Application Form, submitted whether in physical or electronic mode,

the Designated Branch of the SCSB shall verify if sufficient funds equal to the Bid Amount are available in

the ASBA Account, as mentioned in the ASBA Bid cum Application Form, prior to uploading such Bids

with the Stock Exchanges.

(j) If sufficient funds are not available in the ASBA Account, the Designated Branch of the SCSB shall reject

such Bids and shall not upload such Bids with the Stock Exchanges.

(k) If sufficient funds are available in the ASBA Account, the SCSB shall block an amount equivalent to the

Bid Amount mentioned in the ASBA Bid cum Application Form and will enter each Bid option into the

electronic bidding system as a separate Bid and generate a TRS for each price and demand option. The TRS

shall be furnished to the ASBA Bidder on request.

(l) The Bid Amount shall remain blocked in the aforesaid ASBA Account until finalisation of the Basis of

Allotment and consequent transfer of the Bid Amount against the Allotted Equity Shares to the Public Issue

Account, or until withdrawal/failure of the Issue or until withdrawal/rejection of the ASBA Bid cum

Application Form, as the case may be. Once the Basis of Allotment is finalized, the Registrar to the Issue

shall send an appropriate request to the Controlling Branch of the SCSB for unblocking the relevant ASBA

Accounts and for transferring the amount allocable to the successful Bidders to the Public Issue Account. In

case of withdrawal/failure of the Issue, the blocked amount shall be unblocked on receipt of such

information from the Registrar to the Issue.

Bids at Different Price Levels and Revision of Bids

(a) The Company, in consultation with the BRLMs and without the prior approval of, or intimation, to the

Bidders, reserves the right to revise the Price Band during the Bid/ Issue Period, provided that the Cap

Price shall be less than or equal to 120% of the Floor Price and the Floor Price shall not be less than the

face value of the Equity Shares. The revision in Price Band shall not exceed 20% on the either side i.e. the

floor price can move up or down to the extent of 20% of the floor price disclosed at least two days prior to

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the Bid/ Issue Opening Date and the Cap Price will be revised accordingly.

(b) The Company, in consultation with the BRLMs will finalise the Issue Price within the Price Band in

accordance with this clause, without the prior approval of, or intimation, to the Bidders.

(c) The Company, in consultation with the BRLMs, can finalise the Anchor Investor Issue Price within the

Price Band in accordance with this clause, without the prior approval of, or intimation, to the Anchor

Investors.

(d) The Bidders can Bid at any price within the Price Band. The Bidder has to Bid for the desired number of

Equity Shares at a specific price. Retail Individual Bidders may Bid at the Cut-off Price. However, bidding

at Cut-off Price is prohibited for QIB and Non-Institutional Bidders and such Bids from QIB and Non-

Institutional Bidders shall be rejected.

(e) Retail Individual Bidders who Bid at Cut-off Price agree that they shall purchase the Equity Shares at any

price within the Price Band. Retail Individual Bidders shall submit the Bid cum Application Form along

with a cheque/demand draft for the Bid Amount based on the Cap Price with the Syndicate. In case of

ASBA Bidders (excluding Non-Institutional Bidders and QIB Bidders) bidding at Cut-off Price, the ASBA

Bidders shall instruct the SCSBs to block an amount based on the Cap Price.

Escrow mechanism, terms of payment and payment into the Escrow Accounts

For details of the escrow mechanism and payment instructions, please see “Issue Procedure - Payment Instructions”

on page 346 of this Draft Red Herring Prospectus.

Electronic Registration of Bids

(a) The Syndicate and the SCSBs will register the Bids using the on-line facilities of the Stock Exchanges.

(b) The Syndicate and the SCSBs will undertake modification of selected fields in the Bid details already

uploaded within one Working Day from the Bid/Issue Closing Date.

(c) There will be at least one on-line connectivity facility in each city, where a stock exchange is located in

India and where Bids are being accepted. The Syndicate Members and/or SCSBs shall be responsible for

any acts, mistakes or errors or omission and commissions in relation to, (i) the Bids accepted by the

Syndicate Members and the SCSBs, (ii) the Bids uploaded by the Syndicate Members and the SCSBs, (iii)

the Bids accepted but not uploaded by the Syndicate Members and the SCSBs or (iv) with respect to the

Bids by ASBA Bidders, Bids accepted and uploaded without blocking funds in the ASBA Accounts. It

shall be presumed that for Bids uploaded by the SCSBs, the Bid Amount has been blocked in the relevant

ASBA Account.

(d) The Stock Exchanges will offer an electronic facility for registering Bids for the Issue. This facility will be

available with the Syndicate and their authorised agents and the SCSBs during the Bid/ Issue Period. The

Syndicate Members and the Designated Branches of the SCSBs can also set up facilities for off-line

electronic registration of Bids subject to the condition that they will subsequently upload the off-line data

file into the on-line facilities for Book Building on a regular basis. On the Bid/ Issue Closing Date, the

Syndicate and the Designated Branches of the SCSBs shall upload the Bids till such time as may be

permitted by the Stock Exchanges. This information will be available with the BRLMs on a regular basis.

(e) Based on the aggregate demand and price for Bids registered on the electronic facilities of the Stock

Exchanges, a graphical representation of consolidated demand and price as available on the websites of the

Stock Exchanges would be made available at the Bidding centres during the Bid/Issue Period.

(f) At the time of registering each Bid other than ASBA Bids, the Syndicate shall enter the following details of

the Bidders in the on-line system:

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Name of the Bidder: Bidders should ensure that the name given in the Bid cum Application Form

is exactly the same as the name in which the Depositary Account is held. In case the Bid cum

Application Form is submitted in joint names, Bidders should ensure that the Depository Account

is also held in the same joint names and are in the same sequence in which they appear in the Bid

cum Application Form.

Investor Category – Individual, Corporate, FII, NRI, Mutual Fund, etc.

Numbers of Equity Shares Bid for.

Bid Amount.

Cheque Details.

Bid cum Application Form number.

DP ID and client identification number of the beneficiary account of the Bidder.

PAN.

With respect to Bids by ASBA Bidders, at the time of registering such Bids, the Designated Branches of

the SCSBs shall enter the following information pertaining to the ASBA Bidders into the online system:

Name of the ASBA Bidder(s);

Application Number;

PAN (of First ASBA Bidder, in case of more than one ASBA Bidder);

Investor Category and Sub-Category:

Retail Non- Institutional QIB

(No sub category) Individual

Corporate

Others

Mutual Funds

Financial Institutions

Insurance companies

Foreign Institutional investors other than corporate and

individual sub-accounts

Others

Employee/shareholder (if reservation);

DP ID and client identification number;

Beneficiary account number of Equity Shares Bid for;

Quantity;

Bid Amount; and

Bank account number.

(g) A system generated TRS will be given to the Bidder as a proof of the registration of each of the bidding

options. It is the Bidder‟s responsibility to obtain the TRS from the Syndicate or the Designated Branches

of the SCSBs. The registration of the Bid by the member of the Syndicate or the Designated Branches of

the SCSBs does not guarantee that the Equity Shares shall be allocated/Allotted either by the Syndicate or

the Company.

(h) Such TRS will be non-negotiable and by itself will not create any obligation of any kind.

(i) In case of QIB Bidders, only the BRLMs and their Affiliate Syndicate Members have the right to accept the

Bid or reject it. However, such rejection shall be made at the time of receiving the Bid and only after

assigning a reason for such rejection in writing. In case of Non-Institutional Bidders and Retail Individual

Bidders, Bids will be rejected on technical grounds listed on page 350 of this Draft Red Herring Prospectus.

The Members of the Syndicate may also reject Bids if all the information required is not provided and the

Bid cum Application Form is incomplete in any respect. The SCSBs shall have no right to reject Bids,

except on technical grounds.

(j) The permission given by the Stock Exchanges to use their network and software of the online IPO system

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should not in any way be deemed or construed to mean that the compliance with various statutory and other

requirements by the Company and/or the BRLMs are cleared or approved by the Stock Exchanges; nor

does it in any manner warrant, certify or endorse the correctness or completeness of any of the compliance

with the statutory and other requirements nor does it take any responsibility for the financial or other

soundness of the Company, the Promoter, the management or any scheme or project of the Company; nor

does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of

this Draft Red Herring Prospectus; nor does it warrant that the Equity Shares will be listed or will continue

to be listed on the Stock Exchanges.

(k) Only Bids that are uploaded on the online IPO system of the Stock Exchanges shall be considered for

allocation/ Allotment. Members of the Syndicate will be given up to one day after the Bid/Issue Closing

Date to verify DP ID and Client ID uploaded in the online IPO system during the Bid/Issue Period after

which the Registrar to the Issue will receive this data from the Stock Exchanges and will validate the

electronic bid details with depositories records.

(l) Details of Bids in the Anchor Investor Portion will not be registered on the on-line facilities of the

electronic facilities of the Stock Exchanges.

Build up of the book and revision of Bids

(a) Bids received from various Bidders through the Syndicate and the SCSBs shall be electronically uploaded

to the Stock Exchanges‟ mainframe on a regular basis.

(b) The Book gets built up at various price levels. This information will be available with the BRLMs at the

end of the Bid/Issue Period.

(c) During the Bid/Issue Period, any Bidder who has registered his or her interest in the Equity Shares at a

particular price level is free to revise his or her Bid within the Price Band using the printed Revision Form,

which is a part of the Bid cum Application Form.

(d) Revisions can be made in both the desired number of Equity Shares and the Bid Amount by using the

Revision Form. Apart from mentioning the revised options in the Revision Form, the Bidder must also

mention the details of all the options in his or her Bid cum Application Form or earlier Revision Form. For

example, if a Bidder has Bid for three options in the Bid cum Application Form and such Bidder is

changing only one of the options in the Revision Form, he must still fill the details of the other two options

that are not being revised, in the Revision Form. The Syndicate and the Designated Branches of the SCSBs

will not accept incomplete or inaccurate Revision Forms.

(e) The Bidder can make this revision any number of times during the Bid/Issue Period. However, for any

revision(s) in the Bid, the Bidders will have to use the services of the same member of the Syndicate or the

SCSB through whom such Bidder had placed the original Bid. Bidders are advised to retain copies of the

blank Revision Form and the revised Bid must be made only in such Revision Form or copies thereof.

(f) In case of an upward revision in the Price Band announced as above, Retail Individual Bidders who had

Bid at Cut-off Price could either (i) revise their Bid or (ii) shall make additional payment based on the cap

of the revised Price Band (such that the total amount i.e., original Bid Amount plus additional payment

does not exceed Rs. 100,000 if the Bidder wants to continue to Bid at Cut-off Price), with the Syndicate to

whom the original Bid was submitted. In case the total amount (i.e., original Bid Amount plus additional

payment) exceeds Rs. 100,000, the Bid will be considered for allocation under the Non-Institutional Portion

in terms of the Red Herring Prospectus. If, however, the Bidder does not either revise the Bid or make

additional payment and the Issue Price is higher than the cap of the Price Band prior to revision, the

number of Equity Shares Bid for shall be adjusted downwards for the purpose of allocation, such that no

additional payment would be required from the Bidder and the Bidder is deemed to have approved such

revised Bid at Cut-off Price.

(g) In case of a downward revision in the Price Band, announced as above, Retail Individual Bidders who have

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Bid at Cut-off Price could either revise their Bid or the excess amount paid at the time of bidding would be

refunded from the Escrow Account.

(h) The Company, in consultation with the BRLMs, shall decide the minimum number of Equity Shares for

each Bid to ensure that the minimum application value is within the range of Rs. 5,000 to Rs. 7,000.

(i) Any revision of the Bid shall be accompanied by payment in the form of cheque or demand draft for the

incremental amount, if any, to be paid on account of the upward revision of the Bid. With respect to the

Bids by ASBA Bidders, if revision of the Bids results in an incremental amount, the relevant SCSB shall

block the additional Bid Amount. In case of Bids, other than ASBA Bids, the Syndicate shall collect the

payment in the form of cheque or demand draft if any, to be paid on account of the upward revision of the

Bid at the time of one or more revisions by the QIB Bidders. In such cases, the Syndicate will revise the

earlier Bids details with the revised Bid and provide the cheque or demand draft number of the new

payment instrument in the electronic book. The Registrar will reconcile the Bid data and consider the

revised Bid data for preparing the Basis of Allotment.

(j) When a Bidder revises his or her Bid, he or she shall surrender the earlier TRS and may get a revised TRS

from the Syndicate or the SCSB, as applicable. It is the responsibility of the Bidder to request for and

obtain the revised TRS, which will act as proof of his or her having revised the previous Bid.

Price Discovery and Allocation

(a) Based on the demand generated at various price levels, the Company in consultation with the BRLMs shall

finalise the Issue Price.

(b) Under-subscription, if any, in any category, except the QIB Portion, would be allowed to be met with spill-

over from any other category or combination of categories at the sole discretion of the Company in

consultation with the BRLMs and the Desginated Stock Exchange. If at least 50% of the Issue is not

allocated to the QIBs, the entire subscription monies shall be refunded.

(c) Allocation to Non-Residents, including Eligible NRIs and FIIs registered with SEBI, applying on

repatriation basis will be subject to applicable law, rules, regulations, guidelines and approvals.

(d) Allocation to Anchor Investors shall be at the discretion of the Company in consultation with the BRLMs,

subject to the compliance with the SEBI Regulations.

(e) QIB Bidders shall not be allowed to withdraw their Bid after the Bid/Issue Closing Date. Further the

Anchor Investors shall not be allowed to withdraw their Bids after the Anchor Investor Bid/Issue Period.

(f) The Basis of Allotment shall be put up on the website of the Registrar.

Signing of the Underwriting Agreement and the RoC Filing

(a) the Company, the BRLMs and the Syndicate Members shall enter into an Underwriting Agreement on or

immediately after the finalisation of the Issue Price.

(b) After signing the Underwriting Agreement, the Company will update and file the updated Red Herring

Prospectus with the RoC in accordance with the applicable law, which then would be termed as the

„Prospectus‟. The Prospectus will contain details of the Issue Price, Issue size, underwriting arrangements

and will be complete in all material respects.

Pre-Issue Advertisement

Subject to Section 66 of the Companies Act, the Company shall, after registering the Red Herring Prospectus with

the RoC, publish a pre-Issue advertisement, in the form prescribed by the SEBI Regulations, in one English

language national daily newspaper, one Hindi language national daily newspaper and one Regional language daily

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newspaper, each with wide circulation.

Advertisement regarding Issue Price and Prospectus

The Company will issue a statutory advertisement after the filing of the Prospectus with the RoC. This

advertisement, in addition to the information that has to be set out in the statutory advertisement, shall indicate the

Issue Price and the Anchor Investor Issue Price. Any material updates between the date of the Red Herring

Prospectus and the date of Prospectus will be included in such statutory advertisement.

Issuance of Confirmation of Allotment Note (“CAN”)

(a) Upon approval of the Basis of Allotment by the Designated Stock Exchange, the Registrar shall send to the

Syndicate a list of the Bidders who have been Allotted Equity Shares in the Issue.

(b) The Registrar will then dispatch a CAN to the Bidders who have been Allotted Equity Shares in the Issue.

The dispatch of a CAN shall be deemed a valid, binding and irrevocable contract for the Bidder.

(c) The Issuance of CAN is subject to “Notice to Anchor Investors – Allotment Reconciliation and Revised

CANs” as set forth under “Issue Procedure” on page 332 of this Draft Red Herring Prospectus.

Notice to Anchor Investors: Allotment Reconciliation and CANs

A physical book will be prepared by the Registrar on the basis of the Bid cum Application Forms received from

Anchor Investors. Based on the physical book and at the discretion of the Company and the BRLMs, selected

Anchor Investors will be sent an Anchor Investor Allocation Notice and/or a revised Anchor Investor Allocation

Notice, as the case may be. All Anchor Investors will be sent Anchor Investor Allocation Notice post Anchor

Investor Bidding Period and in the event that the Issue Price is higher than the Anchor Investor Issue Price, the

Anchor Investors will be sent a revised Anchor Investor Allocation Notice within one day of the Pricing Date

indicating the number of Equity Shares allocated to such Anchor Investor and the pay-in date for payment of the

balance amount. Anchor Investors should note that they shall be required to pay any additional amounts, being the

difference between the Issue Price and the Anchor Investor Issue Price, as indicated in the revised Anchor Investor

Allocation Notice within the pay-in date referred to in the revised Anchor Investor Allocation Notice. The revised

Anchor Investor Allocation Notice will constitute a valid, binding and irrevocable contract (subject to the issue of

CAN) for the Anchor Investor to pay the difference between the Issue Price and the Anchor Investor Issue Price and

accordingly the CAN will be issued to such Anchor Investors. In the event the Issue Price is lower than the Anchor

Investor Issue Price, the Anchor Investors who have been Allotted Equity Shares will directly receive CAN. The

dispatch of CAN shall be deemed a valid, binding and irrevocable contract for the Allotment of Equity Shares to

such Anchor Investors.

The final allocation is subject to the physical application being valid in all respect along with receipt of stipulated

documents, the Issue Price being finalised at a price not higher than the Anchor Investor Issue Price and Allotment

by the Board of Directors.

Designated Date and Allotment of Equity Shares

(a) The Company will ensure that (i) the Allotment of Equity Shares; and (ii) credit to the successful Bidder‟s

depositary account will be completed within 12 Working Days of the Bid/Issue Closing Date. After the

funds are transferred from the Escrow Account to the Public Issue Account on the Designated Date, the

Company will ensure the credit to the successfull Bidder‟s depository account is completed within two

Working Days from the date of Allotment.

(b) In accordance with the SEBI Regulations, Equity Shares will be issued and Allotment shall be made only in

the dematerialised form to the Allottees.

(c) Allottees will have the option to re-materialise the Equity Shares so Allotted as per the provisions of the

Companies Act and the Depositories Act.

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Investors are advised to instruct their Depository Participant to accept the Equity Shares that may be

allocated/ Allotted to them pursuant to this Issue.

GENERAL INSTRUCTIONS

Do‟s:

(a) Check if you are eligible to apply;

(b) Ensure that you have Bid within the Price Band;

(c) Read all the instructions carefully and complete the Bid cum Application Form;

(d) Ensure that the details about the Depository Participant and the beneficiary account are correct as

Allotment of Equity Shares will be in the dematerialised form only;

(e) Ensure that the Bids are submitted at the bidding centres only on forms bearing the stamp of a member of

the Syndicate or with respect to ASBA Bidders, ensure that your Bid is submitted at a Designated Branch

of the SCSB where the ASBA Bidder or the person whose bank account will be utilised by the Bidder for

bidding has a bank account;

(f) With respect to Bids by ASBA Bidders, ensure that the ASBA Bid cum Application Form is signed by the

account holder in case the applicant is not the account holder. Ensure that you have mentioned the correct

bank account number in the ASBA Bid cum Application Form;

(g) Ensure that you request for and receive a TRS for all your Bid options;

(h) Ensure that you have funds equal to the Bid Amount in your bank account maintained with the SCSB

before submitting the ASBA Bid cum Application Form to the respective Designated Branch of the SCSB;

(i) Ensure that the full Bid Amount is paid for the Bids submitted to the Syndicate and funds equivalent to the

Bid Amount are blocked in case of any Bids submitted though the SCSBs.

(j) Instruct your respective banks to not release the funds blocked in the bank account under the ASBA

process;

(k) Submit revised Bids to the same member of the Syndicate through whom the original Bid was placed and

obtain a revised TRS;

(l) Except for Bids submitted on behalf of the Central Government or the State Government and officials

appointed by a court, all Bidders should mention their PAN allotted under the IT Act;

(m) Ensure that the Demographic Details (as defined herein below) are updated, true and correct in all respects;

(n) Ensure that the name(s) given in the Bid cum Application Form is exactly the same as the name(s) in which

the beneficiary account is held with the Depository Participant. In case the Bid cum Application Form is

submitted in joint names, ensure that the beneficiary account is also held in same joint names and such

names are in the same sequence in which they appear in the Bid cum Application Form.

Don‟ts:

(a) Do not Bid for lower than the minimum Bid size;

(b) Do not Bid/ revise Bid Amount to less than the Floor Price or higher than the Cap Price;

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(c) Do not Bid on another Bid cum Application Form after you have submitted a Bid to the Syndicate or the

SCSBs, as applicable;

(d) Do not pay the Bid Amount in cash, by money order or by postal order or by stockinvest;

(e) Do not send Bid cum Application Forms by post; instead submit the same to a member of the Syndicate or

the SCSBs only;

(f) Do not Bid at Cut-off Price (for QIB Bidders and Non-Institutional Bidders, for Bid Amount in excess of

Rs. 100,000);

(g) Do not Bid for a Bid Amount exceeding Rs. 100,000 (for Bids by Retail Individual Bidders);

(h) Do not fill up the Bid cum Application Form such that the Equity Shares Bid for exceeds the Issue Size

and/ or investment limit or maximum number of Equity Shares that can be held under the applicable laws

or regulations or maximum amount permissible under the applicable regulations;

(i) Do not submit the GIR number instead of the PAN as the Bid is liable to be rejected on this ground; and

(j) Do not submit the Bids without the full Bid Amount.

INSTRUCTIONS FOR COMPLETING THE BID CUM APPLICATION FORM

Bids must be:

(a) Made only in the prescribed Bid cum Application Form or Revision Form, as applicable.

(b) Completed in full, in BLOCK LETTERS in ENGLISH and in accordance with the instructions contained

herein, in the Bid cum Application Form or in the Revision Form. Incomplete Bid cum Application Forms

or Revision Forms are liable to be rejected. Bidders should note that the Syndicate and / or the SCSBs, as

appropriate, will not be liable for errors in data entry due to incomplete or illegible Bid cum Application

Forms or Revision Forms.

(c) Information provided by the Bidders will be uploaded in the online IPO system by the Syndicate and the

SCSBs, as the case may be, and the electronic data will be used to make allocation/ Allotment. The

Bidders should ensure that the details are correct and legible.

(d) For Retail Individual Bidders, the Bid must be for a minimum of [] Equity Shares and in multiples of []

thereafter subject to a maximum Bid Amount of Rs. 100,000.

(e) For Non-Institutional Bidders and QIB Bidders, Bids must be for a minimum of such number of Equity

Shares that the Bid Amount exceeds or equal to Rs. 100,000 and in multiples of [] Equity Shares

thereafter. Bids cannot be made for more than the Issue size. Bidders are advised to ensure that a single Bid

from them should not exceed the investment limits or maximum number of Equity Shares that can be held

by them under the applicable laws or regulations.

(f) For Anchor Investors, Bids must be for a minimum of such number of Equity Shares that the Bid Amount

exceeds or equal to Rs. 100 million and in multiples of [] Equity Shares thereafter.

(g) In single name or in joint names (not more than three, and in the same order as their Depository Participant

details).

(h) Thumb impressions and signatures other than in the languages specified in the Eighth Schedule to the

Constitution of India must be attested by a Magistrate or a Notary Public or a Special Executive Magistrate

under official seal.

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Bidder‟s PAN, Depository Account and Bank Account Details

Bidders should note that on the basis of PAN of the Bidders, DP ID and beneficiary account number provided

by them in the Bid cum Application Form, the Registrar will obtain from the Depository the demographic

details including address, Bidders bank account details, MICR code and occupation (hereinafter referred to

as “Demographic Details”). These bank account details would be used for giving refunds (including through

physical refund warrants, direct credit, NECS, NEFT and RTGS) or unblocking of ASBA Account. Hence,

Bidders are advised to immediately update their bank account details as appearing on the records of the

Depository Participant. Please note that failure to do so could result in delays in despatch/ credit of refunds to

Bidders or unblocking of ASBA Account at the Bidders sole risk and neither the BRLMs or the Registrar or

the Escrow Collection Banks or the SCSBs nor the Company shall have any responsibility and undertake any

liability for the same. Hence, Bidders should carefully fill in their Depository Account details in the Bid cum

Application Form.

IT IS MANDATORY FOR ALL THE BIDDERS TO GET THEIR EQUITY SHARES IN

DEMATERIALISED FORM. ALL BIDDERS SHOULD MENTION THEIR DEPOSITORY

PARTICIPANT‟S NAME, DEPOSITORY PARTICIPANT IDENTIFICATION NUMBER AND

BENEFICIARY ACCOUNT NUMBER IN THE BID CUM APPLICATION FORM. INVESTORS MUST

ENSURE THAT THE NAME GIVEN IN THE BID CUM APPLICATION FORM IS EXACTLY THE

SAME AS THE NAME IN WHICH THE DEPOSITORY ACCOUNT IS HELD. IN CASE THE BID CUM

APPLICATION FORM IS SUBMITTED IN JOINT NAMES, IT SHOULD BE ENSURED THAT THE

DEPOSITORY ACCOUNT IS ALSO HELD IN THE SAME JOINT NAMES AND ARE IN THE SAME

SEQUENCE IN WHICH THEY APPEAR IN THE BID CUM APPLICATION FORM.

These Demographic Details would be used for all correspondence with the Bidders including mailing of the

CANs/allocation advice and printing of bank particulars on the refund orders or for refunds through electronic

transfer of funds, as applicable. The Demographic Details given by Bidders in the Bid cum Application Form would

not be used for any other purpose by the Registrar.

By signing the Bid cum Application Form, the Bidder would be deemed to have authorised the Depositories to

provide, upon request, to the Registrar, the required Demographic Details as available on its records.

Refund orders/ CANs would be mailed at the address of the Bidder as per the Demographic Details received

from the Depositories. Bidders may note that delivery of refund orders/ CANs may get delayed if the same

once sent to the address obtained from the Depositories are returned undelivered. In such an event, the

address and other details given by the Bidder (other than ASBA Bidders) in the Bid cum Application Form

would be used only to ensure dispatch of refund orders. Please note that any such delay shall be at such

Bidder‟s sole risk and neither the Company, the Escrow Collection Banks, Registrar, the BRLMs shall be

liable to compensate the Bidder for any losses caused to the Bidder due to any such delay or liable to pay any

interest for such delay.

In case no corresponding record is available with the Depositories, which matches the three parameters, namely,

PAN of the sole/First Bidder, the DP ID and the beneficiary‟s identity, then such Bids are liable to be rejected.

Bids by Non-Residents including Eligible NRIs and FIIs on a repatriation basis

Bids and revision to Bids must be made in the following manner:

1. On the Bid cum Application Form or the Revision Form, as applicable (blue in colour), and completed in

full in BLOCK LETTERS in ENGLISH in accordance with the instructions contained therein.

2. In a single name or joint names (not more than three and in the same order as their Depositary Participant

Details).

3. Bids on a repatriation basis shall be in the names of individuals, or in the name of FIIs but not in the names

of minors, OCBs, firms or partnerships, foreign nationals (excluding NRIs) or their nominees.

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Bids by Eligible NRIs for a Bid Amount of up to Rs. 100,000 would be considered under the Retail Portion for the

purposes of allocation and Bids for a Bid Amount of more than Rs. 100,000 would be considered under Non-

Institutional Portion for the purposes of allocation.

Refunds, dividends and other distributions, if any, will be payable in Indian Rupees only and net of bank

charges and/or commission. In case of Bidders who remit money through Indian Rupee drafts purchased

abroad, such payments in Indian Rupees will be converted into US Dollars or any other freely convertible

currency as may be permitted by the RBI at the rate of exchange prevailing at the time of remittance and will

be dispatched by registered post or if the Bidders so desire, will be credited to their NRE accounts, details of

which should be furnished in the space provided for this purpose in the Bid cum Application Form. The

Company will not be responsible for loss, if any, incurred by the Bidder on account of conversion of foreign

currency.

There is no reservation for Eligible NRIs and FIIs and all Bidders will be treated on the same basis with other

categories for the purpose of allocation.

Bids under Power of Attorney

In case of Bids made pursuant to a power of attorney or by limited companies, corporate bodies, registered societies,

FIIs, Mutual Funds, insurance companies and provident funds with a minimum corpus of Rs. 250 million (subject to

applicable law) and pension funds with a minimum corpus of Rs. 250 million, a certified copy of the power of

attorney or the relevant resolution or authority, as the case may be, along with a certified copy of the memorandum

of association and articles of association and/or bye laws must be lodged along with the Bid cum Application Form.

Failing this, the Company reserves the right to accept or reject any Bid in whole or in part, in either case, without

assigning any reason therefor.

In addition to the above, certain additional documents are required to be submitted by the following entities:

(a). With respect to Bids by FIIs and Mutual Funds, a certified copy of their SEBI registration certificate must

be lodged along with the Bid cum Application Form.

(b). With respect to Bids by insurance companies registered with the Insurance Regulatory and Development

Authority, in addition to the above, a certified copy of the certificate of registration issued by the Insurance

Regulatory and Development Authority must be lodged along with the Bid cum Application Form.

(c). With respect to Bids made by provident funds with a minimum corpus of Rs. 250 million (subject to

applicable law) and pension funds with a minimum corpus of Rs. 250 million, a certified copy of a

certificate from a chartered accountant certifying the corpus of the provident fund/pension fund must be

lodged along with the Bid cum Application Form.

The Company in its absolute discretion, reserves the right to relax the above condition of simultaneous lodging of

the power of attorney along with the Bid cum Application form, subject to such terms and conditions that the

Company, the BRLMs may deem fit.

PAYMENT INSTRUCTIONS

Escrow Mechanism for Bidders other than ASBA Bidders

The Company and the Syndicate shall open Escrow Account(s) with one or more Escrow Collection Bank(s) in

whose favour the Bidders shall make out the cheque or demand draft in respect of his or her Bid and/or revision of

the Bid. Cheques or demand drafts received for the full Bid Amount from Bidders would be deposited in the Escrow

Account.

The Escrow Collection Banks will act in terms of the Red Herring Prospectus and the Escrow Agreement. The

Escrow Collection Banks for and on behalf of the Bidders shall maintain the monies in the Escrow Account until the

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Designated Date. The Escrow Collection Banks shall not exercise any lien whatsoever over the monies deposited

therein and shall hold the monies therein in trust for the Bidders. On the Designated Date, the Escrow Collection

Banks shall transfer the funds represented by allocation of Equity Shares (other than ASBA funds with the SCSBs)

from the Escrow Account, as per the terms of the Escrow Agreement, into the Public Issue Account with the

Bankers to the Issue. The balance amount after transfer to the Public Issue Account shall be transferred to the

Refund Account. Payments of refund to the Bidders shall also be made from the Refund Account as per the terms of

the Escrow Agreement and the Draft Red Herring Prospectus.

The Bidders should note that the escrow mechanism is not prescribed by SEBI and has been established as an

arrangement between the Company, the Syndicate, the Escrow Collection Banks and the Registrar to facilitate

collections from the Bidders.

Payment mechanism for ASBA Bidders

The ASBA Bidders shall specify the bank account number in the ASBA Bid cum Application Form and the SCSB

shall block an amount equivalent to the Bid Amount in the bank account specified in the ASBA Bid cum

Application Form. The SCSB shall keep the Bid Amount in the relevant bank account blocked until withdrawal/

rejection of the ASBA Bid or receipt of instructions from the Registrar to unblock the Bid Amount. In the event of

withdrawal or rejection of the ASBA Bid cum Application Form or for unsuccessful ASBA Bid cum Application

Forms, the Registrar shall give instructions to the SCSB to unblock the application money in the relevant bank

account within one day of receipt of such instruction. The Bid Amount shall remain blocked in the ASBA Account

until finalisation of the Basis of Allotment in the Issue and consequent transfer of the Bid Amount to the Public

Issue Account, or until withdrawal/ failure of the Issue or until rejection of the Bid by ASBA Bidder, as the case

may be.

Payment into Escrow Account for Bidders other than ASBA Bidders

Each Bidder shall draw a cheque or demand draft or (for Anchor Investors) remit the funds electronically through

the RTGS mechanism for the Bid Amount payable on the Bid as per the following terms:

1. All Bidders would be required to pay the full Bid Amount at the time of the submission of the Bid cum

Application Form.

2. The Bidders shall, with the submission of the Bid cum Application Form, draw a payment instrument for

the Bid Amount in favour of the Escrow Account and submit the same to the Syndicate. If the payment is

not made favouring the Escrow Account along with the Bid cum Application Form, the Bid of the Bidder

shall be rejected.

3. The payment instruments for payment into the Escrow Account should be drawn in favour of:

(a) In case of Resident QIB Bidders: “[●]”

(b) In case of Non-Resident QIB Bidders: “[●]”

(c) In case of Resident Retail and Non-Institutional Bidders: “[●]”

(d) In case of Non-Resident Retail and Non-Institutional Bidders: “[●]”

4. Anchor Investors would be required to pay the Bid Amount at the time of submission of the Bid cum

Application Form. In the event of the Issue Price being higher than the price at which allocation is made to

Anchor Investors, the Anchor Investors shall be required to pay such additional amount to the extent of

shortfall between the price at which allocation is made to them and the Issue Price as per the pay-in date

mentioned in the revised Anchor Investor Allocation Notice. If the Issue Price is lower than the price at

which allocation is made to Anchor Investors, the amount in excess of the Issue Price paid by Anchor

Investors shall not be refunded to them.

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5. For Anchor Investors, the payment instruments for payment into the Escrow Account should be drawn in

favour of:

(a) In case of resident Anchor Investors: “[●]”

(b) In case of non-resident Anchor Investors: “[●]”

6. In case of Bids by NRIs applying on repatriation basis, the payments must be made through Indian Rupee

drafts purchased abroad or cheques or bank drafts, for the amount payable on application remitted through

normal banking channels or out of funds held in Non-Resident External (NRE) Accounts or Foreign

Currency Non-Resident (FCNR) Accounts, maintained with banks authorised to deal in foreign exchange

in India, along with documentary evidence in support of the remittance. Payment will not be accepted out

of Non-Resident Ordinary (NRO) Account of Non-Resident Bidder bidding on a repatriation basis.

Payment by drafts should be accompanied by bank certificate confirming that the draft has been issued by

debiting to NRE Account or FCNR Account.

7. In case of Bids by NRIs applying on non-repatriation basis, the payments must be made through Indian

Rupee Drafts purchased abroad or cheques or bank drafts, for the amount payable on application remitted

through normal banking channels or out of funds held in Non-Resident External (NRE) Accounts or

Foreign Currency Non-Resident (FCNR) Accounts, maintained with banks authorised to deal in foreign

exchange in India, along with documentary evidence in support of the remittance or out of a Non-Resident

Ordinary (NRO) Account of a Non-Resident Bidder bidding on a non-repatriation basis. Payment by drafts

should be accompanied by a bank certificate confirming that the draft has been issued by debiting an NRE

or FCNR or NRO Account.

8. In case of Bids by FIIs, the payment should be made out of funds held in a Special Rupee Account along

with documentary evidence in support of the remittance. Payment by drafts should be accompanied by a

bank certificate confirming that the draft has been issued by debiting the Special Rupee Account.

9. The monies deposited in the Escrow Account will be held for the benefit of the Bidders (other than ASBA

Bidders) till the Designated Date.

10. On the Designated Date, the Escrow Collection Banks shall transfer the funds from the Escrow Account as

per the terms of the Escrow Agreement into the Public Issue Account with the Bankers to the Issue.

11. On the Designated Date and no later than 10 Working Days from the Bid/Issue Closing Date, the Escrow

Collection Bank shall also refund all amounts payable to unsuccessful Bidders (other than ASBA Bidders)

and also the excess amount paid on bidding, if any, after adjusting for allocation/Allotment to such Bidders.

12. Payments should be made by cheque, or a demand draft drawn on any bank (including a co-operative

bank), which is situated at, and is a member of or sub-member of the bankers‟ clearing house located at the

centre where the Bid cum Application Form is submitted. Outstation cheques/bank drafts drawn on banks

not participating in the clearing process will not be accepted and applications accompanied by such cheques

or bank drafts are liable to be rejected. Cash/ stockinvest/money orders/postal orders will not be accepted.

Submission of Bid cum Application Form

All Bid cum Application Forms or Revision Forms duly completed and accompanied by account payee cheques or

drafts shall be submitted to the Syndicate at the time of submission of the Bid. With respect to the ASBA Bidders,

the ASBA Bid cum Application Form or the ASBA Revision Form shall be submitted to the Designated Branches of

the SCSBs.

No separate receipts shall be issued for the money payable on the submission of Bid cum Application Form or

Revision Form. However, the collection centre of the Syndicate will acknowledge the receipt of the Bid cum

Application Forms or Revision Forms by stamping and returning to the Bidder the acknowledgement slip. This

acknowledgement slip will serve as the duplicate of the Bid cum Application Form for the records of the Bidder.

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OTHER INSTRUCTIONS

Joint Bids in the case of Individuals

Bids may be made in single or joint names (not more than three). In the case of joint Bids, all payments will be made

out in favour of the Bidder whose name appears first in the Bid cum Application Form or Revision Form. All

communications will be addressed to the First Bidder and will be dispatched to his or her address as per the

Demographic Details received from the Depository.

Multiple Bids

A Bidder should submit only one Bid (and not more than one) for the total number of Equity Shares required. Two

or more Bids will be deemed to be multiple Bids if the sole or First Bidder is one and the same.

In case of a Mutual Fund, a separate Bid can be made in respect of each scheme of the Mutual Fund registered with

SEBI and such Bids in respect of more than one scheme of the Mutual Fund will not be treated as multiple Bids

provided that the Bids clearly indicate the scheme concerned for which the Bid has been made. Bids by QIBs under

the Anchor Investor Portion and QIB Portion (excluding Anchor Investor Portion) will not be considered as multiple

Bids.

The Company reserves the right to reject, in its absolute discretion, all or any multiple Bids in any or all categories.

In this regard, the procedures which would be followed by the Registrar to detect multiple Bids are given below:

1. All Bids will be checked for common PAN and will be accumulated and taken to a separate process file

which would serve as a multiple master.

2. In this master, a check will be carried out for the same PAN. In cases where the PAN is different, the same

will be deleted from this master.

3. The Registrar will obtain, from the depositories, details of the applicant‟s address based on the DP ID and

Beneficiary Account Number provided in the Bid data and create an address master.

4. The addresses of all the applications in the multiple master will be strung from the address master. This

involves putting the addresses in a single line after deleting non-alpha and non-numeric characters i.e.

commas, full stops, hash etc. Sometimes, the name, the first line of address and pin code will be converted

into a string for each application received and a photo match will be carried out amongst all the

applications processed. A print-out of the addresses will be taken to check for common names. The Bids

with same name and same address will be treated as multiple Bids.

5. The Bids will be scrutinised for DP ID and Beneficiary Account Numbers. In case applications bear the

same DP ID and Beneficiary Account Numbers, these will be treated as multiple applications.

Permanent Account Number or PAN

Except for Bids on behalf of the Central or State Government and the officials appointed by the courts, the Bidders,

or in the case of a Bid in joint names, each of the Bidders, should mention his/ her PAN allotted under the I.T. Act.

In accordance with the SEBI Regulations, the PAN would be the sole identification number for participants transacting

in the securities market, irrespective of the amount of transaction. Any Bid cum Application Form without the

PAN is liable to be rejected. It is to be specifically noted that Bidders should not submit the GIR number

instead of the PAN as the Bid is liable to be rejected on this ground.

REJECTION OF BIDS

In case of QIB Bidders, the Company in consultation with the BRLMs may reject Bids provided that the reasons for

rejecting the same shall be provided to such Bidders in writing. In case of Non-Institutional Bidders and Retail

Individual Bidders, the Company has a right to reject Bids based on technical grounds. Consequent refunds shall be

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made by RTGS/NEFT/NES/Direct Credit/cheque or pay order or draft and will be sent to the Bidder‟s address at the

Bidder‟s risk. With respect to Bids by ASBA Bidders, the Designated Branches of the SCSBs shall have the right to

reject Bids by ASBA Bidders if at the time of blocking the Bid Amount in the Bidder‟s bank account, the respective

Designated Branch of the SCSB ascertains that sufficient funds are not available in the Bidder‟s bank account

maintained with the SCSB. Subsequent to the acceptance of the ASBA Bid by the SCSB, the Company would have

a right to reject the ASBA Bids only on technical grounds.

Grounds for Technical Rejections

Bidders are advised to note that Bids are liable to be rejected inter alia on the following technical grounds:

Amount paid does not tally with the amount payable for the highest value of Equity Shares Bid for. With

respect to Bids by ASBA Bidders, the amounts mentioned in the ASBA Bid cum Application Form does

not tally with the amount payable for the value of the Equity Shares Bid for;

In case of partnership firms, Equity Shares may be registered in the names of the individual partners and no

firm as such shall be entitled to apply;

Bid by persons not competent to contract under the Indian Contract Act, 1872 including minors, insane

persons;

PAN not mentioned in the Bid cum Application Form;

GIR number furnished instead of PAN;

Bids for lower number of Equity Shares than specified for that category of investors;

Bids at a price less than the Floor Price;

Bids at a price more than the Cap Price;

Signature of sole and/or joint Bidders missing;

Submission of more than five ASBA Bid cum Application Forms per bank account;

Submission of Bids by Anchor Investors through ASBA process;

Bids at Cut-off Price by Non-Institutional and QIB Bidders;

Bids for number of Equity Shares which are not in multiples of [ ];

Category not ticked;

Multiple Bids as defined in the Draft Red Herring Prospectus;

In case of Bids under power of attorney or by limited companies, corporate, trust etc., relevant documents

are not submitted;

Bids accompanied by stockinvest/money order/postal order/cash;

Bid cum Application Forms does not have the stamp of the BRLMs or Syndicate Members or the SCSB;

Bid cum Application Forms does not have Bidder‟s depository account details;

Bid cum Application Forms are not delivered by the Bidders within the time prescribed as per the Bid cum

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Application Forms, Bid/Issue Opening Date advertisement and the Draft Red Herring Prospectus and as per

the instructions in the Draft Red Herring Prospectus and the Bid cum Application Forms;

In case no corresponding record is available with the Depositories that matches three parameters namely,

names of the Bidders (including the order of names of joint holders), the Depositary Participant‟s identity

(DP ID) and the beneficiary‟s account number;

With respect to Bids by ASBA Bidders, inadequate funds in the bank account to block the Bid Amount

specified in the ASBA Bid cum Application Form at the time of blocking such Bid Amount in the bank

account;

Bids for amounts greater than the maximum permissible amounts prescribed by the regulations;

Bids where clear funds are not available in Escrow Accounts as per final certificate from the Escrow

Collection Banks;

Bids by QIBs not submitted through the BRLMs or in case of ASBA Bids for QIBs (other than Anchor

Investors) not intimated to the BRLMs;

Bids by persons in the United States excluding “qualified institutional buyers” as defined in Rule 144A of

the Securities Act or other than in reliance of Regulation S under the Securities Act;

Bids by FVCIs;

Bids by multilateral and bilateral development institutions;

Bids by any person outside India if not in compliance with applicable foreign and Indian Laws;

Bids not uploaded on the terminals of the Stock Exchanges; and

Bids by persons prohibited from buying, selling or dealing in the shares directly or indirectly by SEBI or

any other regulatory authority.

IN CASE THE DP ID, CLIENT ID AND PAN MENTIONED IN THE BID CUM APPLICATION FORM

AND ENTERED INTO THE ELECTRONIC BIDDING SYSTEM OF THE STOCK EXCHANGES OR

THE SYNDICATE/THE SCSBs DO NOT MATCH WITH THE DP ID, CLIENT ID AND PAN

AVAILABLE IN THE RECORDS WITH THE DEPOSITARIES, THE APPLICATION IS LIABLE TO BE

REJECTED.

EQUITY SHARES IN DEMATERIALISED FORM WITH NSDL OR CDSL

As per the provisions of Section 68B of the Companies Act, the Allotment of Equity Shares in this Issue shall be

only in a dematerialised form, (i.e., not in the form of physical certificates but be fungible and be represented by the

statement issued through the electronic mode).

In this context, two agreements have been signed among the Company, the respective Depositories and the

Registrar:

Agreement dated [●] between NSDL, the Company and the Registrar;

Agreement dated [●], between CDSL, the Company and the Registrar.

All Bidders can seek Allotment only in dematerialised mode. Bids from any Bidder without relevant details of his or

her depository account are liable to be rejected.

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(a) A Bidder applying for Equity Shares must have at least one beneficiary account with either of the

Depository Participants of either NSDL or CDSL prior to making the Bid.

(b) The Bidder must necessarily fill in the details (including the Beneficiary Account Number and Depository

Participant‟s identification number) appearing in the Bid cum Application Form or Revision Form.

(c) Allotment to a successful Bidder will be credited in electronic form directly to the beneficiary account

(with the Depository Participant) of the Bidder.

(d) Names in the Bid cum Application Form or Revision 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 account details in the Depository.

(e) If incomplete or incorrect details are given under the heading „Bidders Depository Account Details‟ in the

Bid cum Application Form or Revision Form, it is liable to be rejected.

(f) The Bidder is responsible for the correctness of his or her Demographic Details given in the Bid cum

Application Form vis-à-vis those with his or her Depository Participant.

(g) Equity Shares in electronic form can be traded only on the Stock Exchanges having electronic connectivity

with NSDL and CDSL. All the Stock Exchanges where the Equity Shares are proposed to be listed have

electronic connectivity with CDSL and NSDL.

(h) The trading of the Equity Shares of the Company would be in dematerialised form only for all Bidders in

the demat segment of the respective Stock Exchanges.

Communications

All future communications in connection with Bids made in this Issue should be addressed to the Registrar quoting

the full name of the sole or First Bidder, Bid cum Application Form number, Bidders Depository Account Details,

number of Equity Shares applied for, date of Bid form, name and address of the member of the Syndicate or the

Designated Branch of the SCSBs where the Bid was submitted and cheque or draft number and issuing bank thereof

or with respect to ASBA Bids, bank account number in which the amount equivalent to the Bid Amount was

blocked.

Bidders can contact the Compliance Officer or the Registrar 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

accounts, refund orders etc. In case of ASBA Bids submitted to the Designated Branches of the SCSBs, the

Bidders can contact the Designated Branches of the SCSBs.

PAYMENT OF REFUND

Bidders other than ASBA Bidders must note that on the basis of the names of the Bidders, Depository Participant‟s

name, DP ID, beneficiary account number provided by them in the Bid cum Application Form, the Registrar will

obtain, from the Depositories, the Bidders‟ bank account details, including the nine digit Magnetic Ink Character

Recognition (“MICR”) code as appearing on a cheque leaf. Hence, Bidders are advised to immediately update their

bank account details as appearing on the records of the Depository Participant. Please note that failure to do so could

result in delays in despatch of refund order or refunds through electronic transfer of funds, as applicable, and any

such delay shall be at the Bidders‟ sole risk and neither the Company, the Registrar, Escrow Collection Bank(s),

Bankers to the Issue, the BRLMs shall be liable to compensate the Bidders for any losses caused to the Bidder due

to any such delay or liable to pay any interest for such delay.

Mode of making refunds for Bidders other than ASBA Bidders

The payment of refund, if any, for Bidders other than ASBA Bidders would be done through various modes in the

353

following order of preference:

1. NECS – Payment of refund would be done through NECS for applicants having an account at any of the

centres where such facility has been made available. This mode of payment of refunds would be subject to

availability of complete bank account details including the MICR code as appearing on a cheque leaf, from

the Depositories. The payment of refunds is mandatory for applicants having a bank account at any of the

abovementioned centres, except where the applicant, being eligible, opts to receive refund through direct

credit or RTGS.

2. Direct Credit – Applicants having bank accounts with the Refund Bank (s), as mentioned in the Bid cum

Application Form, shall be eligible to receive refunds through direct credit. Charges, if any, levied by the

Refund Bank(s) for the same would be borne by the Company.

3. RTGS – Applicants having a bank account at any of the abovementioned centres and whose refund amount

exceeds Rs. 5 million, have the option to receive refund through RTGS. Such eligible applicants who

indicate their preference to receive refund through RTGS are required to provide the IFSC code in the Bid

cum Application Form. In the event the same is not provided, refund shall be made through NECS.

Charges, if any, levied by the Refund Bank(s) for the same would be borne by the Company. Charges, if

any, levied by the applicant‟s bank receiving the credit would be borne by the applicant.

4. NEFT – Payment of refund shall be undertaken through NEFT wherever the applicants‟ bank has been

assigned the Indian Financial System Code (IFSC), which can be linked to a Magnetic Ink Character

Recognition (MICR), if any, available to that particular bank branch. IFSC Code will be obtained from the

website of RBI as on a date immediately prior to the date of payment of refund, duly mapped with MICR

numbers. Wherever the applicants have registered their nine digit MICR number and their bank account

number while opening and operating the demat account, the same will be duly mapped with the IFSC Code

of that particular bank branch and the payment of refund will be made to the applicants through this

method. The process flow in respect of refunds by way of NEFT is at an evolving stage and hence use of

NEFT is subject to operational feasibility, cost and process efficiency. The process flow in respect of

refunds by way of NEFT is at an evolving stage, hence use of NEFT is subject to operational feasibility,

cost and process efficiency. In the event that NEFT is not operationally feasible, the payment of refunds

would be made through any one of the other modes as discussed in the sections.

5. For all other applicants, including those who have not updated their bank particulars with the MICR code,

the refund orders will be despatched under certificate of posting for value upto Rs. 1,500 and through

Speed Post/ Registered Post for refund orders of Rs. 1,500 and above. Such refunds will be made by

cheques, pay orders or demand drafts drawn on the Escrow Collection Banks and payable at par at places

where Bids are received. Bank charges, if any, for cashing such cheques, pay orders or demand drafts at

other centres will be payable by the Bidders.

Mode of making refunds for ASBA Bidders

In case of ASBA Bidders, the Registrar shall instruct the relevant SCSB to unblock the funds in the relevant ASBA

Account to the extent of the Bid Amount specified in the ASBA Bid cum Application Forms for withdrawn, rejected

or unsuccessful or partially successful ASBA Bids within 12 Working Days of the Bid/Issue Closing Date.

DISPOSAL OF APPLICATIONS AND APPLICATION MONEYS AND INTEREST IN CASE OF DELAY

With respect to Bidders other than ASBA Bidders, the Company shall ensure dispatch of Allotment advice, refund

orders (except for Bidders who receive refunds through electronic transfer of funds) and give benefit to the

beneficiary account with Depository Participants and submit the documents pertaining to the Allotment to the Stock

Exchanges within two Working Days of date of Allotment of Equity Shares.

In case of applicants who receive refunds through NECS, direct credit or RTGS, the refund instructions will be

given to the clearing system within 12 Working Days from the Bid/ Issue Closing Date. A suitable communication

shall be sent to the Bidders receiving refunds through this mode within 12 Working Days of Bid/ Issue Closing

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Date, giving details of the bank where refunds shall be credited along with amount and expected date of electronic

credit of refund.

The Company shall use best efforts to ensure that all steps for completion of the necessary formalities for listing and

commencement of trading at all the Stock Exchanges where the Equity Shares are proposed to be listed, are taken

within 12 Working Days of the Bid/Issue Closing Date.

In accordance with the Companies Act, the requirements of the Stock Exchanges and the SEBI Regulations, the

Company further undertakes that:

Allotment of Equity Shares shall be made only in dematerialised form within 12 Working Days of the

Bid/Issue Closing Date; and

With respect to Bidders other than ASBA Bidders, dispatch of refund orders or in a case where the refund

or portion thereof is made in electronic manner, the refund instructions are given to the clearing system

within 12 Working Days of the Bid/Issue Closing Date would be ensured. With respect to the ASBA

Bidders, instructions for unblocking of the ASBA Bidder‟s Bank Account shall be made within 12

Working Days from the Bid/Issue Closing Date.

The Company shall pay interest at 15% p.a. for any delay beyond the 15 days from the Bid/Issue Closing

Date as mentioned above, if Allotment is not made and refund orders are not dispatched or if, in a case

where the refund or portion thereof is made in electronic manner, the refund instructions have not been

given to the clearing system in the disclosed manner and/or demat credits are not made to investors within

the 12 Working Days prescribed above. If such money is not repaid within eight days from the day the

Company becomes liable to repay, the Company and every Director of the Company who is an officer in

default shall, on and from expiry of eight days, be jointly and severally liable to repay the money with

interest as prescribed under the applicable law.

IMPERSONATION

Attention of the applicants is specifically drawn to the provisions of sub-section (1) of Section 68 A of the

Companies Act, 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

person in a fictitious name,

shall be punishable with imprisonment for a term which may extend to five years.”

BASIS OF ALLOTMENT

A. For Retail Individual Bidders

Bids received from the Retail Individual Bidders at or above the Issue Price shall be grouped

together to determine the total demand under this category. The Allotment to all the successful

Retail Individual Bidders will be made at the Issue Price.

The Issue size less Allotment to Non-Institutional and QIB Bidders shall be available for

Allotment to Retail Individual Bidders who have Bid in the Issue at a price that is equal to or

greater than the Issue Price.

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If the aggregate demand in this category is less than or equal to 13,625,130 Equity Shares at or

above the Issue Price, full Allotment shall be made to the Retail Individual Bidders to the extent of

their valid Bids.

If the aggregate demand in this category is greater than 13,625,130 Equity Shares at or above the

Issue Price, the Allotment shall be made on a proportionate basis up to a minimum of [ ] Equity

Shares. For the method of proportionate Basis of Allotment, refer below.

B. For Non-Institutional Bidders

Bids received from Non-Institutional Bidders at or above the Issue Price shall be grouped together

to determine the total demand under this category. The Allotment to all successful Non-

Institutional Bidders will be made at the Issue Price.

The Issue size less Allotment to QIBs and Retail shall be available for Allotment to Non-

Institutional Bidders who have Bid in the Issue at a price that is equal to or greater than the Issue

Price.

If the aggregate demand in this category is less than or equal to 5,839,341 Equity Shares at or

above the Issue Price, full Allotment shall be made to Non-Institutional Bidders to the extent of

their demand.

In case the aggregate demand in this category is greater than 5,839,341 Equity Shares at or above

the Issue Price, Allotment shall be made on a proportionate basis up to a minimum of [ ] Equity

Shares. For the method of proportionate Basis of Allotment refer below.

C. For QIBs (other than Anchor Investors)

Bids received from the QIB Bidders at or above the Issue Price shall be grouped together to

determine the total demand under this portion. The Allotment to all the successful QIB Bidders

will be made at the Issue Price.

The QIB Portion shall be available for Allotment to QIB Bidders who have Bid in the Issue at a

price that is equal to or greater than the Issue Price.

Allotment shall be undertaken in the following manner:

(a) In the first instance allocation to Mutual Funds for up to 5% of the QIB Portion

(excluding Anchor Investor Portion) shall be determined as follows:

(i) In the event that Bids by Mutual Fund exceeds 5% of the QIB Portion

(excluding Anchor Investor Portion), allocation to Mutual Funds shall be done

on a proportionate basis for up to 5% of the QIB Portion (excluding Anchor

Investor Portion).

(ii) In the event that the aggregate demand from Mutual Funds is less than 5% of the

QIB Portion (excluding Anchor Investor Portion) then all Mutual Funds shall

get full Allotment to the extent of valid Bids received above the Issue Price.

(iii) Equity Shares remaining unsubscribed, if any, not allocated to Mutual Funds

shall be available for Allotment to all QIB Bidders as set out in (b) below;

(b) In the second instance Allotment to all QIBs shall be determined as follows:

(i) In the event that the oversubscription in the QIB Portion (excluding Anchor

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Investor Portion), all QIB Bidders who have submitted Bids above the Issue

Price shall be allotted Equity Shares on a proportionate basis for up to 95% of

the QIB Portion.

(ii) Mutual Funds, who have received allocation as per (a) above, for less than the

number of Equity Shares Bid for by them, are eligible to receive Equity Shares

on a proportionate basis along with other QIB Bidders (excluding Anchor

Investor Portion).

(iii) Under-subscription below 5% of the QIB Portion (excluding Anchor Investor

Portion), if any, from Mutual Funds, would be included for allocation to the

remaining QIB Bidders on a proportionate basis.

The aggregate Allotment to QIB Bidders shall not be less than 13,625,130 Equity Shares.

D. For Anchor Investor Portion

Allocation of Equity Shares to Anchor Investors at the Anchor Investor Issue Price will be at the

discretion of the Company, in consultation with the BRLMs, subject to compliance with the

following requirements:

(a) not more than 30% of the QIB Portion will be allocated to Anchor Investors;

(b) one-third of the Anchor Investor Portion shall be reserved for domestic Mutual Funds,

subject to valid Bids being received from domestic Mutual Funds at or above the price at

which allocation is being done to other Anchor Investors;

(c) allocation to Anchor Investors shall be on a discretionary basis and subject to a minimum

number of two Anchor Investors for allocation upto Rs. 2,500 million and minimum

number of five Anchor Investors for allocation more than Rs. 2,500 million.

The number of Equity Shares Allotted to Anchor Investors and the Anchor Investor Issue Price,

shall be made available in the public domain by the BRLMs before the Bid/ Issue Opening Date

by intimating the same to the Stock Exchanges.

Method of Proportionate Basis of Allotment in the Issue

Except in relation to Anchor Investors, in the event of the Issue being over-subscribed, the Company shall finalise

the Basis of Allotment in consultation with the Designated Stock Exchange. The executive director (or any other

senior official nominated by them) of the Designated Stock Exchange along with the BRLMs and the Registrar shall

be responsible for ensuring that the Basis of Allotment is finalised in a fair and proper manner.

The Allotment shall be made in marketable lots, on a proportionate basis as explained below:

a) Bidders will be categorised according to the number of Equity Shares applied for.

b) The total number of Equity Shares to be Allotted to each category as a whole shall be arrived at on a

proportionate basis, which is the total number of Equity Shares applied for in that category (number of

Bidders in the category multiplied by the number of Equity Shares applied for) multiplied by the inverse of

the over-subscription ratio.

c) Number of Equity Shares to be Allotted to the successful Bidders will be arrived at on a proportionate

basis, which is total number of Equity Shares applied for by each Bidder in that category multiplied by the

inverse of the over-subscription ratio.

d) In all Bids where the proportionate Allotment is less than [ ] Equity Shares per Bidder, the Allotment shall

357

be made as follows:

The successful Bidders out of the total Bidders for a category shall be determined by draw of lots

in a manner such that the total number of Equity Shares Allotted in that category is equal to the

number of Equity Shares calculated in accordance with (b) above; and

Each successful Bidder shall be Allotted a minimum of [ ] Equity Shares.

e) If the proportionate Allotment to a Bidder is a number that is more than [ ] but is not a multiple of one

(which is the marketable lot), the decimal would be rounded off to the higher whole number if that decimal

is 0.5 or higher. If that number is lower than 0.5 it would be rounded off to the lower whole number.

Allotment to all in such categories would be arrived at after such rounding off.

f) If the Equity Shares allocated on a proportionate basis to any category are more than the Equity Shares

Allotted to the Bidders in that category, the remaining Equity Shares available for Allotment shall be first

adjusted against any other category, where the Allotted Equity Shares are not sufficient for proportionate

Allotment to the successful Bidders in that category. The balance Equity Shares, if any, remaining after

such adjustment will be added to the category comprising Bidders applying for minimum number of Equity

Shares.

g) Subject to valid Bids being received, allocation of Equity Shares to Anchor Investors shall be at the sole

discretion of the Company, in consultation with the BRLMs.

Illustration of Allotment to QIBs and Mutual Funds (“MF”)

A. Issue Details

Sr. No. Particulars Issue details

1. Issue size 2000 million equity shares

2. Allocation to QIB* 1,000 million equity shares

3. Anchor Investor Portion 300 million equity shares

4. Portion available to QIBs other than Anchor

Investors [(2) minus (3)]

700 million equity shares

Of which:

a. Allocation to MF (5%) 35 million equity shares

b. Balance for all QIBs including MFs 665 million equity shares

3 No. of QIB applicants 10

4 No. of shares applied for 5000 million equity shares * Where 50% of the issue size is required to be alloted to QIBs.

B. Details of QIB Bids

Sr. No. Type of QIB bidders# No. of shares bid for (in million)

1 A1 500

2 A2 200

3 A3 1,300

4 A4 500

5 A5 500

6 MF1 400

7 MF2 400

8 MF3 800

9 MF4 200

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Sr. No. Type of QIB bidders# No. of shares bid for (in million)

10 MF5 200

Total 5,000

# A1-A5: ( QIB bidders other than MFs), MF1-MF5 (QIB bidders which are Mutual Funds)

C. Details of Allotment to QIB Bidders/ Applicants

(Number of equity shares in million)

Type of

QIB

bidders

Shares

bid for

Allocation of 35 million

Equity Shares to MF

proportionately (please see

note 2 below)

Allocation of balance 665

million Equity Shares to QIBs

proportionately (please see

note 4 below)

Aggregate

allocation to

MFs

(I) (II) (III) (IV) (V)

A1 500 0 66.50 0

A2 200 0 26.60 0

A3 1,300 0 172.90 0

A4 500 0 66.50 0

A5 500 0 66.50 0

MF1 400 7 53.20 60.20

MF2 400 7 53.20 60.20

MF3 800 14 106.40 120.40

MF4 200 3.50 26.60 30.10

MF5 200 3.50 26.60 30.10

5,000 35 665 301

Please note:

1. The illustration presumes compliance with the requirements specified in this Draft Red Herring

Prospectus in “Issue Structure” on page 328 of this Draft Red Herring Prospectus.

2. Out of 700 million equity shares allocated to QIBs, 35 million (i.e. 5%) will be allocated on

proportionate basis among five Mutual Fund applicants who applied for 2000 million equity

shares in QIB category.

3. The balance 665 million equity shares (i.e. 700-35 (available for MFs)) will be allocated on

proportionate basis among 10 QIB applicants who applied for 5000 million equity shares

(including five MF applicants who applied for 2000 million equity shares).

4. The figures in the fourth column entitled “Allocation of balance 665 million Equity Shares to

QIBs proportionately” in the above illustration are arrived as under:

For QIBs other than Mutual Funds (A1 to A5)= No. of shares bid for (i.e. in column II) X

665 / 4,965.

For Mutual Funds (MF1 to MF5)= [(No. of shares bid for (i.e. in column II of the table

above) less Equity Shares allotted ( i.e., column III of the table above)] X 665 / 4,965.

The numerator and denominator for arriving at allocation of 665 million shares to the 10

QIBs are reduced by 35 million shares, which have already been allotted to Mutual Funds

in the manner specified in column III of the table above.

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Letters of Allotment or Refund Orders or instructions to the SCSBs

The Company shall give credit to the beneficiary account with depository participants within 12 Working Days from

the Bid/Issue Closing Date. Applicants residing at the centres where clearing houses are managed by the RBI, will

get refunds through NECS only except where applicant is otherwise disclosed as eligible to get refunds through

direct credit and RTGS. The Company shall ensure dispatch of refund orders, if any, of value up to Rs. 1,500, by

“Under Certificate of Posting”, and shall dispatch refund orders above Rs. 1,500, if any, by registered post or speed

post at the sole or First Bidder‟s sole risk within 12 Working Days of the Bid/Issue Closing Date. Bidders to whom

refunds are made through electronic transfer of funds will be sent a letter through ordinary post, intimating them

about the mode of credit of refund within 12 Working Days of the Bid/ Issue Closing Date. In case of ASBA

Bidders, the Registrar shall instruct the relevant SCSBs to unblock the funds in the relevant ASBA Account to the

extent of the Bid Amount specified in the ASBA Bid cum Application Forms for withdrawn, rejected or

unsuccessful or partially successful ASBA Bids within 12 Working Days of the Bid/Issue Closing Date.

Interest in case of delay in despatch of Allotment Letters or Refund Orders/ instruction to the SCSBs by the

Registrar.

The Company agrees that (i) Allotment of Equity Shares; and (ii) credit to the successful Bidders‟ depositary

accounts will be completed within 12 Working Days of the Bid/ Issue Closing Date. The Company further agrees

that it shall pay interest at the rate of 15% p.a. if the Allotment letters or refund orders have not been despatched to

the applicants or if, in a case where the refund or portion thereof is made in electronic manner, the refund

instructions have not been given in the disclosed manner within 15 days from the Bid/ Issue Closing Date.

The Company will provide adequate funds required for dispatch of refund orders or Allotment advice to the

Registrar.

Refunds will be made by cheques, pay-orders or demand drafts drawn on a bank appointed by the Company as a

Refund Bank and payable at par at places where Bids are received. Bank charges, if any, for encashing such

cheques, pay orders or demand drafts at other centres will be payable by the Bidders.

UNDERTAKINGS BY THE COMPANY

The Company undertakes the following:

That the complaints received in respect of this Issue shall be attended to by the Company expeditiously and

satisfactorily;

That all steps for completion of the necessary formalities for listing and commencement of trading at all the

Stock Exchanges where the Equity Shares are proposed to be listed within 12 Working Days of the

Bid/Issue Closing Date;

That funds required for making refunds to unsuccessful applicants as per the mode(s) disclosed shall be

made available to the Registrar by the Issuer;

That where refunds are made through electronic transfer of funds, a suitable communication shall be sent to

the applicant within 15 days of the Bid/ Issue Closing Date, as the case may be, giving details of the bank

where refunds shall be credited along with amount and expected date of electronic credit of refund;

That the Promoter‟s contribution in full has already been brought in;

That the certificates of the securities/ refund orders to Eligible NRIs shall be despatched within specified

time;

That no further issue of Equity Shares shall be made till the Equity Shares offered through the Red Herring

Prospectus are listed or until the Bid monies are refunded on account of non-listing, under-subscription etc.;

360

and

That adequate arrangements shall be made to collect all ASBA Bid cum Application Forms and to consider

them similar to non-ASBA applications while finalising the Basis of Allotment.

The Company shall not have recourse to the Net proceeds until the final approval for listing and trading of the

Equity Shares from all the Stock Exchanges where listing is sought, has been received.

Withdrawal of the Issue

The Company, in consultation with the BRLMs, reserves the right not to proceed with the Issue anytime after the

Bid/Issue Opening Date but before the Allotment of Equity Shares. In such an event, the Company would issue a

public notice in the newspapers, in which the pre-Issue advertisements were published, within two days of the Bid/

Issue Closing Date, providing reasons for not proceeding with the Issue. The Company shall also inform the same to

Stock Exchanges on which the Equity Shares are proposed to be listed.

Any further issue of Equity Shares by the Company shall be in compliance with applicable laws.

Utilisation of Issue proceeds

The Board of Directors certify that:

all monies received out of the Issue shall be credited/transferred to a separate bank account other than the

bank account referred to in sub-section (3) of Section 73 of the Companies Act;

details of all monies utilised out of the Issue shall be disclosed, and continue to be disclosed till the time

any part of the issue proceeds remains unutilised, under an appropriate head in our balance sheet indicating

the purpose for which such monies have been utilised;

details of all unutilised monies out of the Issue, if any shall be disclosed under an appropriate separate head

in the balance sheet indicating the form in which such unutilised monies have been invested;

the utilisation of monies received under Promoter‟s contribution shall be disclosed, and continue to be

disclosed till the time any part of the Issue proceeds remains unutilised, under an appropriate head in the

balance sheet of the Company indicating the purpose for which such monies have been utilised; and

the details of all unutilised monies out of the funds received under Promoter‟s contribution shall be

disclosed under a separate head in the balance sheet of the issuer indicating the form in which such

unutilised monies have been invested.

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RESTRICTIONS ON FOREIGN OWNERSHIP OF INDIAN SECURITIES

Foreign investment in Indian securities is regulated through the Industrial Policy, 1991 of the Government of India

and the FEMA and circulars and notifications issued thereunder. While the Industrial Policy, 1991 prescribes the

limits and the conditions subject to which foreign investment can be made in different sectors of the Indian

economy, FEMA regulates the precise manner in which such investment may be made. Under the Industrial Policy,

unless specifically restricted, foreign investment is freely permitted in all sectors of the Indian economy up to any

extent and without any prior approvals, but the foreign investor is required to follow certain prescribed procedures

and reporting requirements for making such investment. The government bodies responsible for granting foreign

investment approvals are the Foreign Investment Promotion Board of the Government of India (“FIPB”) and the

RBI.

FIIs are permitted to subscribe to shares of an Indian company in a public offer without the prior approval of the

RBI, so long as the price of the equity shares to be issued is not less than the price at which the equity shares are

issued to residents.

The transfer of shares between an Indian resident and a non-resident does not require the prior approval of the FIPB

or the RBI, provided that (i) the activities of the investee company are under the automatic route under the foreign

direct investment (FDI) Policy and transfer does not attract the provisions of the SEBI (Substantial Acquisition of

Shares and Takeovers) Regulations, 1997 (ii) the non-resident shareholding is within the sectoral limits under the

FDI policy; and (iii) the pricing is in accordance with the guidelines prescribed by the SEBI/RBI.

As per the existing policy of the Government of India, OCBs cannot participate in this Issue.

Foreign Investment in the Real Estate Sector

Foreign investment in the real estate sector is regulated by the relevant provisions of the FDI Manual dated

November 2005, FEMA Regulations, and the relevant Press Notes issued by the Secretariat for Industrial

Assistance, GoI.

Investments by NRIs

FDI Manual

Item No. 9 of Annexure II to the said FDI Manual outlines the sectoral caps in relation to „Housing and Real Estate‟.

Annexure II specifies the following as activities under the automatic route in which investment is permitted only by

NRIs:

(a) Development of serviced plots and construction of built up residential premises;

(b) Investment in real estate covering construction of residential and commercial premises including business


(c) Development of townships;

(d) City and regional level urban infrastructure facilities, including both roads and bridges;

(e) Investment in manufacture of building materials, which is also open to FDI;

(f) Investment in participatory ventures in (a) to (e) above;

(g) Investment in housing finance institutions, which is also open to FDI as an NBFC.

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FEMA Regulations

The FEMA Regulations, state that the investment cap in the real estate on the activities in the „Housing and Real

Estate‟ is permit investment to the extent of 100% only by NRIs in the following specified areas:

I. Development of serviced plots and construction of built up residential premises;

II. Investment in real estate covering construction of residential and commercial premises including business


III. Development of townships;

IV. City and regional level urban infrastructure facilities, including both roads and bridges;

V. Investment in manufacture of building materials, which is also open to FDI;

VI. Investment in participatory ventures in (a) to (c) above;

VII. Investment in housing finance institutions, which is also open to FDI as an NBFC.

However, all other forms of FDI are prohibited in relation to Housing and Real Estate Business.

Consolidated FDI Policy

The law in relation to investment in the real estate sector is provided under the Consolidated FDI Policy. The said

press note has also amended certain press notes which have been issued earlier, in the same field.

Under the Consolidated FDI Policy, FDI up to 100% under the automatic route is allowed in „townships, housing,

built-up infrastructure and construction-development projects (which would include, but not be restricted to,

housing, commercial premises, hotels, resorts, hospitals, educational institutions, recreational facilities, city and

regional level infrastructure)‟, subject to the compliance with the following requirements.

(a) Minimum area to be developed under each project is as under:

(i) In case of development of serviced housing plots, a minimum land area of 10 hectares;

(ii) In case of construction-development projects, a minimum built up area of 50,000 square meters;

(iii) In case of a combination project, anyone of the above two conditions would suffice.

(b) Minimum capitalisation of US$ 10 million for wholly owned subsidiaries and US$ 5 million for joint

ventures with Indian partners. The funds are to be brought in within six months of commencement of

business of the Company.

(c) Original investment is not to be repatriated before a period of three years from completion of minimum

capitalisation. The investor is to be permitted to exit earlier with prior approval of the Government through

the FIPB.

(d) At least 50% of the project must be developed within a period of five years from the date of obtaining all

statutory clearances. The investor would not be permitted to sell undeveloped plots. “Underdeveloped

plots” will mean where roads, water supply, street lighting, drainage, sewerage and other conveniences as

applicable under prescribed regulations have not been made available.

(e) The State Government/Municipal Local Body concerned, which approves the building/development plans,

would monitor compliance of the above conditions by the developer.

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Therefore applicable law only permits investment by an NRI under the automatic route in the „Housing and Real

Estate‟ sector up to 100% in relation to townships, housing, built-up infrastructure and construction-development

projects (which would include, but not be restricted to, housing, commercial premises, hotels, resorts, hospitals,

educational institutions, recreational facilities, city and regional level infrastructure) and additionally permits up to

100% FDI in the „Housing and Real Estate‟ subject to compliance with the terms provided in the Consolidated FDI

Policy.

Investments by FIIs

FIIs including institutions such as pension funds, investment trusts, asset management companies, nominee

companies and incorporated, institutional portfolio managers can invest in all the securities traded on the primary

and secondary markets in India. FIIs are required to obtain an initial registration from SEBI and a general

permission from the RBI to engage in transactions regulated under FEMA. FIIs must also comply with the

provisions of the SEBI (Foreign Institutional Investors) Regulations, 1995, as amended from time to time. The initial

registration and the RBI‟s general permission together enable the registered FII to buy (subject to the ownership

restrictions discussed below) and sell freely securities issued by Indian companies, to realise capital gains or

investments made through the initial amount invested in India, to subscribe or renounce rights issues for shares, to

appoint a domestic custodian for custody of investments held and to repatriate the capital, capital gains, dividends,

income received by way of interest and any compensation received towards sale or renunciation of rights issues of

shares.

By way of Circular No. 53 dated December 17, 2003, the RBI has permitted FIIs to subscribe to shares of an Indian

company in a public offer without the prior approval of the RBI, so long as the price of the equity shares to be issued

is not less than the price at which the equity shares are issued to residents.

Transfers of equity shares previously required the prior approval of the FIPB. However, vide a RBI circular dated

October 4, 2004 issued by the RBI, the transfer of shares between an Indian resident and a non-resident does not

require the prior approval of the FIPB or the RBI, provided that (i) the activities of the investee company are under

the automatic route under the foreign direct investment (FDI) Policy and transfer does not attract the provisions of

the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (ii) the non-resident shareholding is

within the sectoral limits under the FDI policy, and (iii) the pricing is in accordance with the guidelines prescribed

by the SEBI/RBI.

The Company is eligible to issue Shares to FIIs under the portfolio investment scheme, covered under notification

FEMA No. 20/2000-RB dated May 3, 2000 and subsequent amendments thereto.

Pursuant to the Portfolio Investment Scheme, FII registered with the SEBI may buy or sell securities of Indian

companies on stock exchanges in India through registered stock brokers. FIIs are also permitted to purchase shares

and convertible debentures of an Indian company, subject to the specified percentage limits.

The Equity Shares have not been and will not be registered under the US Securities Act of 1933 (the

“Securities Act”) or any state securities laws in the United States and may not be offered or sold within the

United States or to, or for the account or benefit of, “U.S. persons” (as defined in Regulation S under the

Securities Act), except pursuant to an exemption from, or in a transaction not subject to, the registration

requirements of the Securities Act. Accordingly, the Equity Shares are only being offered and sold (i) in the

United States to “qualified institutional buyers”, as defined in Rule 144A of the Securities Act in reliance on

Rule 144A under the Securities Act, and (ii) outside the United States to certain persons in offshore

transactions in compliance with Regulation S under the Securities Act.



jurisdiction, except in compliance with the applicable laws of such jurisdiction.

The above information is given for the benefit of the Bidders. The Company and the BRLMs are not liable

for any amendments or modification or changes in applicable laws or regulations, which may occur after the

date of this Draft Red Herring Prospectus. Bidders are advised to make their independent investigations and

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ensure that the number of Equity Shares Bid for do not exceed the applicable limits under laws or

regulations.

The above information is given for the benefit of the Bidders. The Company and the BRLMs are not liable for any

amendments or modification or changes in applicable laws or regulations, which may occur after the date of this

Draft Red Herring Prospectus. Bidders are advised to make their independent investigations and ensure that the

number of Equity Shares Bid for do not exceed the applicable limits under laws or regulations.

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SECTION VIII: MAIN PROVISIONS OF ARTICLES OF ASSOCIATION

Capitalised terms used in this section have the meaning that has been given to such terms in the Articles of

Association of the Company. Pursuant to Schedule II of the Companies Act and the SEBI Regulations, the main

provisions of the Articles of Association of the Company are detailed below:

Authorised Share Capital

Article 1 provides that “The authorized Share Capital of the Company shall be such amount as is given in Clause V

of the Memorandum of Association and minimum paid-up share capital of the Company shall be Rs.5,00,000/-

(Rupees Five Lakh Only).”

Increase of Capital

Article 5 provides that “The Company at its General Meeting may, from time to time, by an Ordinary Resolution

increase the Capital by the creation of new Shares, such increase to be of such aggregate amount and to be divided

into Shares of such respective amounts as the resolution shall prescribe. The new Shares shall be issued on such

terms and conditions and with such rights and privileges annexed thereto as the resolution shall prescribe, and in

particular, such Shares may be issued with a preferential or qualified right to Dividends, and in the distribution of

assets of the Company and with a right of voting at General Meeting of the Company in conformity with Section 87

of the Companies Act, 1956. Whenever the Capital of the Company has been increased under the provisions of the

Articles, the Directors shall comply with the provisions of Section 97 of the Act.”

Reduction of Capital

Article 6 provides that “The Company may, subject to the provisions of Sections 78, 80, 100 to 105 (both inclusive)

and other applicable provisions of the Act from time to time, by Special Resolution reduce its Capital and any

Capital Redemption Reserve Account or Share Premium Account in any manner for the time being authorized by

law, and in particular, the Capital may be paid off on the footing that it may be called up again or otherwise.”

Sub-division and Consolidation of Share Certificate

Article 7 provides that “Subject to the provisions of Section 94 of the Act, the Company in General Meeting, may by

an Ordinary Resolution from time to time:

(a) Divide, sub-divide or consolidate its Shares, or any of them, and the resolution whereby any Share is sub-

divided, may determine that as between the holders of the Shares resulting from such sub-division one or

more of such shares have some preference of special advantage as regards Dividend Capital or otherwise as

compared with the others

(b) Cancel Shares which at the date of such general meeting have not been taken or agreed to be taken by any

person and diminish the amount of its Share Capital by the amount of the Shares so cancelled.”

New Capital part of the existing Capital

Article 8 provides that “Except so far as otherwise provided by the conditions of the issue or by these presents any

Capital raised by the creation of new Shares, shall be considered as part of the existing Capital and shall be subject

to the provisions herein contained, with reference to the payment of calls and installments, forfeiture, lien, surrender,

Transfer and transmission, voting and otherwise.”

Power to issue preference Shares

Article 10 provides that “Subject to the provisions of Section 80 of the Act, the Company shall have the powers to

issue preference Shares which are liable to be redeemed and the resolution authorizing such issue shall prescribe the

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manner, terms and conditions of such redemption.”

Further Issue of Shares

Article 11 provides that

(1) “Where at any time after the expiry of two years from the formation of the Company or at any time after

the expiry of one year from the allotment of Shares in the Company made for the first time after its

formation, whichever is earlier, it is proposed to increase the subscribed Capital of the Company by

allotment of further Shares then

a) Such further Shares shall be offered to the persons who at the date of the offer, are holders of the

equity Shares of the Company, in proportion, as nearly as circumstances admit, to the Capital Paid

up on those Shares at that date.

b) The offer aforesaid shall be made by a notice specifying the number of Shares offered and limiting

a time not being less than fifteen days from the date of offer within which the offer, if not

accepted, will be deemed to have been declined.

c) The offer aforesaid shall be deemed to include a right exercisable by the person concerned to

renounce the Shares offered to him or any of them in favour of any other person and the notice

referred to in sub clause (b) hereof shall contain a statement of this right.

d) After the expiry of the time specified in the aforesaid notice or on receipt of earlier intimation

from the person to whom such notice is given that he declines to accept the Shares offered, the

Board may dispose of them in such manner as they think most beneficial to the Company

(2) Notwithstanding anything contained in sub-clause (1) the further Shares aforesaid may be offered to any

persons (whether or not those persons include the persons referred to in clause (a) of sub- clause (1) hereof)

in any manner whatsoever.

(a) If a special resolution to that effect is passed by the Company in General Meeting, or

(b) Where no such Special Resolution is passed, if the votes cast (whether on a show of hands or on a

poll as the case may be) in favour of the proposal contained in the resolution moved in the general

meeting (including the casting vote, if any, of the Chairman) by the Members who, being entitled

to do so, vote in person, or where Proxies are allowed, by proxy, exceed the votes, if any, cast

against the proposal by Members so entitled and voting and the Central Government is satisfied,

on an application made by the Board of Directors in this behalf that the proposal is most beneficial

to the Company.

(3) Nothing in sub-clause (c) of (1) hereof shall be deemed:

(a) To extend the time within which the offer should be accepted; or

(b) To authorize any person to exercise the right of renunciation for a second time on the ground that

the person in whose favour the renunciation was first made has declined to take the Shares

comprised in the renunciation.

(4) Nothing in this Article shall apply to the increase of the subscribed Capital of the Company caused by the

exercise of an option attached to the Debentures issued or loans raised by the Company:

(i) To convert such Debentures or loans into Shares in the Company; or

(ii) To subscribe for Shares in the Company.

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PROVIDED THAT the terms of issue of such Debentures or the terms of such loans include a term

providing for such option and such term:

(a) Either has been approved by the Central Government before the issue of the Debentures or the

raising of the loans or is in conformity with Rules, if any, made by that Government in this behalf;

and

(b) In the case of Debentures or loans other than Debentures issued to or loans obtained from the

Government or any institution specified by the Central Government in this behalf, has also been

approved by a Special Resolution passed by the Company in General Meeting before the issue of

the Debentures or raising of the loans.”

Commission for placing Shares, Debentures, etc


(d) “Subject to the provisions of the Act, the Company may at any time pay a commission to any person for

subscribing or agreeing to subscribe (whether absolutely or conditionally) for any Shares, Debentures, or

debenture-stock of the Company or underwriting or procuring or agreeing to procure subscriptions

(whether absolute or conditional) for Shares, Debentures or debenture-stock of the Company.

(e) The Company may also, in any issue, pay such brokerage as may be lawful.”

Company‟s lien on Shares /Debentures

Article 25 provides that “The Company shall have a first and paramount lien upon all the Shares /Debentures (other

than fully Paid up Shares/Debentures) registered in the name of each Member (whether solely or jointly with others)

and upon the proceeds of sale thereof for all moneys (whether presently payable or not) called or payable at fixed

time in respect of such Shares/Debentures, and no equitable interest in any Shares shall be created except upon the

footing and condition that this Article will have full effect and such lien shall extend to all Dividends and bonuses

from time to time declared in respect of such Shares/Debentures. Unless otherwise agreed, the registration of a

Transfer of Shares/Debentures shall operate as a waiver of the Company‟s lien if any, on such Shares/Debentures.

The Directors may at any time declare any Shares/Debentures wholly or in part to be exempt from provisions of this

clause. The fully Paid up shares shall be free from all lien and that in the case of partly paid Shares the Company‟s

lien shall be restricted to moneys called or payable at a fixed time in respect of such Shares.”

Enforcing lien by sale

Article 26 provides that “For the purpose of enforcing such lien, the Board may sell the Shares subject thereto in

such manner as they think fit, and for that purpose may cause to be issued a duplicate certificate in respect of such

Shares and may authorize one of their members to execute a Transfer thereof on behalf of and in the name of such

Member. No sale shall be made until such period as aforesaid shall have arrived and until notice in writing of the

intention to sell have been served on such Member or his representative and default shall have been made by him or

them in payment, fulfillment or discharge of such debts, liabilities or engagements for fourteen days after such

notice.”

Board to have right to make calls on Shares

Article 28 provides that “The Board may, from time to time, subject to the terms on which any Shares may have

been issued and subject to the conditions of allotment, by a resolution passed at a meeting of the Board (and not by

circular resolution), make such call as it thinks fit upon the Members in respect of all moneys unpaid on the Shares

held by them respectively and each Member shall pay the amount of every call so made on him to the person or

persons and the Member(s) and place(s) appointed by the Board. A call may be made payable by installments.

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Provided that the Board shall not give the option or right to call on Shares to any person except with the sanction of

the Company in General Meeting.”

Notice for call

Article 29 provides that “Fourteen (14) days notice in writing of any call shall be given by the Company specifying

the date, time and places of payment and the person or persons to whom such call be paid.”

Call when made

Article 30 provides that “The Board of Directors may, when making a call by resolution, determine the date on

which such call shall be deemed to have been made, not being earlier than the date of resolution making such call,

and thereupon the call shall be deemed to have been made on the date so determined and if no such date is so

determined a call shall be deemed to have been made at the date when the resolution authorizing such call was

passed at the meeting of the Board.”

Liability of joint holders for a call

Article 31 provides that “The joint-holders of a Share shall be jointly and severally liable to pay all calls in respect

thereof.”

Board to extend time to pay call

Article 32 provides that “The Board may, from time to time, at its discretion extend the time fixed for the payment

of any call and may extend such time to all or any of the Members. The Board may be fairly entitled to grant such

extension, but no Member shall be entitled to such extension, save as a matter of grace and favour.”

Calls to carry Interest

Article 33 provides that “If a Member fails to pay any call due from him on the day appointed for payment thereof,

or any such extension thereof as aforesaid, he shall be liable to pay interest on the same from the day appointed for

the payment thereof to the time of actual payment at 5% (five percent) per annum or such lower rate as shall from

time to time be fixed by the Board but nothing in this Article shall render it obligatory for the Board to demand or

recover any interest from any such Member.”

Dues deemed to be calls

Article 34 provides that “Any sum, which as per the terms of issue of a Share becomes payable on allotment or at a

fixed date whether on account of the nominal value of the Share or by way of premium, shall for the purposes of the

Articles be deemed to be a call duly made and payable on the date on which by the terms of issue the same may

become payable and in case of non payment all the relevant provisions of these Articles as to payment of interest

and expenses, forfeiture or otherwise shall apply as if such sum had become payable by virtue of a call duly made

and notified.”

Proof of dues in respect of Share

Article 35 provides that “On any trial or hearing of any action or suit brought by the Company against any Member

or his representatives for the recovery of any money claimed to be due to the Company in respect of his Shares it

shall be sufficient to prove (i) that the name of the Members in respect of whose Shares the money is sought to be

recovered appears entered in the Register of Members as the holder, at or subsequent to the date on which the money

sought to be recovered is alleged to have become due on the shares, (ii) that the resolution making the call is duly

recorded in the minute book, and that notice of such call was duly given to the Member or his representatives

pursuance of these Articles, and (iii) it shall not be necessary to prove the appointment of the Directors who made

such call, nor any other matters whatsoever, but the proof of the matters aforesaid shall be conclusive of the debt.”

369

Partial payment not to preclude forfeiture

Article 36 provides that “Neither a judgment nor a decree in favour of the Company, for call or other moneys due in

respect of any Share nor any part payment or satisfaction there under, nor the receipt by the Company of a portion of

any money which shall, from time to time be due from any Member to the Company in respect of his Shares either

by way of principal or interest, nor any indulgence granted by the Company in respect of the payment of any such

money shall preclude the Company from thereafter proceeding to enforce forfeiture of such Shares as hereinafter

provided.”

Payment in anticipation of call may carry interest


“(a) The Directors may, if they think fit, subject to the provisions of Section 92 of the Act, agree to and receive

from any Member willing to advance the same, whole or any part of the moneys due upon the Shares held

by him beyond the sums actually called for and upon the amount so paid or satisfied in advance, or so much

thereof as from time to time exceeds the amount of the calls then made upon the Shares in respect of which

such advance has been made, the Company may pay interest at such rate, as the Member paying such sum

in advance and the Directors agree upon, provided that money paid in advance of calls shall not confer a

right to participate in profits or Dividend. The Directors may at any time repay the amount so advanced.

(b) The Member shall not be entitled to any voting rights in respect of the moneys so paid by him until the

same would but for such payment become presently payable.

(c) The provisions of these Articles shall mutatis mutandis apply to the calls on Debentures of the Company.”

Board to have right to forfeit Shares

Article 38 provides that “If any Member fails to pay any call or installment of a call or before the day appointed for

the payment of the same or any such extension thereof as aforesaid, the Board may at any time thereafter during

such time as the call or installment remains unpaid, give notice to him requiring him to pay the same together with

any interest that may have accrued and all expenses that may have been incurred by the Company by reason of such

non-payment.”

Forfeited Share to be the property of the Company

Article 42 provides that “Any Share so forfeited shall be deemed to be the property of the Company and may be

sold, re-allocated or otherwise disposed of either to the original holder thereof or to any other person upon such

terms and in such manner as the Board shall think fit.”

Board entitled to cancel forfeiture

Article 48 provides that “The Board may at any time before any Share so forfeited shall have them sold, re-allotted

or otherwise disposed of, cancel the forfeiture thereof upon such conditions at it thinks fit.”

Instrument of Transfer

Article 51 provides that “The instrument of Transfer of any Share shall be in writing and all the provisions of

Section 108 of the Act, and of any statutory modification thereof for the time being shall be duly complied with in

respect of all Transfer of Shares and registration thereof. The Company shall use a common form of Transfer in all

cases.”

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Directors may refuse to register Transfer

Article 54 provides that “Subject to the provisions of Section 111A of the Act, these Articles and other applicable

provisions of the Act or any other law for the time being in force, the Board may refuse whether in pursuance of any

power of the Company under these Articles or otherwise to register the Transfer of, or the transmission by operation

of law of the right to, any Shares or interest of a Member in or Debentures of the Company. The Company shall

within one Month from the date on which the instrument of Transfer, or the intimation of such Transfer, as the case

may be, was delivered with the Company, send notice of refusal to the transferee and transferor or to the person

giving notice of such transmission, as the case may be, giving reasons for such refusal. Provided that registration of

a Transfer shall not be refused on the ground of the transferor being either alone or jointly with any other person or

persons indebted to the Company on any account whatsoever except where the Company has a lien on Shares.”

Transmission of Shares

Article 59 provides that “Subject to the provisions of these presents, any person becoming entitled to Shares in

consequence of the death, lunacy, bankruptcy or insolvency of any Members, or by any lawful means other than by

a Transfer in accordance with these Articles may, with the consent of the Board (which it shall not be under any

obligation to give), upon producing such evidence as the Board thinks sufficient, that he sustains the character in

respect of which he proposes to act under this Articles, or of his title, either be registering himself as the holder of

the Shares or elect to have some person nominated by him and approved by the Board, registered as such holder,

provided, nevertheless, if such person shall elect to have his nominee registered, he shall testify that election by

executing in favour of his nominee an instrument of Transfer in accordance with the provision herein contained and

until he does so he shall not be freed from any liability in respect of the Shares.”

Rights on Transmission

Article 60 provides that “A person entitled to a Share by transmission shall, subject to the Directors right to retain

such Dividends or money as hereinafter provided, is entitled to receive and may give discharge for any Dividends or

other moneys payable in respect of the Share.”

Nomination Facility


“(I) Every holder of Shares, or holder of Debentures of the Company may at any time, nominate, in the

prescribed manner a person to whom his Shares in or Debentures of the Company shall rest in the event of

his death.

(II) Where the Shares in or Debentures of the Company or held by more than one person jointly, the joint

holders may together nominate in the prescribed manner, a person to whom all the rights in the Shares or

Debentures of the Company shall rest in the event of death of all the joint holders.

(III) Notwithstanding any thing contained in any other law for the time being in force or in any disposition,

whether testamentary or otherwise in respect of such Shares in or Debentures of the Company where a

nomination made in the prescribed manner purports to confer on any person the right to vest the Shares in

or Debentures of the Company, the nominee shall, on the death of the Shareholder or Debentures holder of

the Company or as the case may be on the death of the joint holders become entitled to all the rights in the

Shares or Debentures of the Company or as the case may be all the joint holders in relation to such Shares

in or Debenture of the Company to the exclusion of all the other persons, unless the nomination is varied or

cancelled in the prescribed manner.

(IV) Where the nominee is a minor it shall be lawful for the holder of Shares or Debentures, to make the

nomination and to appoint in the prescribed manner any person to become entitled to Shares in or

Debentures of the Company in the event of his death in the event of minority of the nominee.

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Any person who becomes a nominee by virtue of the provisions of Section 109 A upon the production of

such evidence as may be required by the Board and subject as hereinafter provided elect either

a) To be registered himself as holder of the Shares or Debentures as the case may be, or

b) To make such Transfer of the Share or debenture as the case may be, as the deceased Shareholder

or debenture holder, as the case may be could have made.

If the person being a nominee, so becoming entitled, elects to be registered himself as a holder of the Share

or debenture as the case may be, he shall deliver or send to the Company a notice in writing signed by him

stating that he so elects and such notice shall be accompanied with a Death Certificate of the deceased

Share holder or debenture holder as the case may be.

All the limitations, restrictions and provisions of this Act, relating to the right to Transfer and registration

of Transfer of Shares or Debentures shall be applicable to any such notice or Transfer as aforesaid as if the

death of the Member had not occurred and the notice or Transfer where a transfer is signed by that

Shareholder or debenture holder, as the case may be.

A person being a nominee, becoming entitled to a Share or debenture by reason of the death of the holder

shall be entitled to same Dividends and other advantages to which he would be entitled if he were the

registered holder of the Share or debenture, except that he shall not, before being registered a Member in

respect of his Share of debenture, be entitled in respect of it to exercise any right conferred by Membership

in relation to the meetings of the Company.

Provided that the Board may, at any time, give notice requiring any such person to elect either to be

registered himself or to Transfer the Share or debenture and if the notice is not complied with within 90

days, the Board may thereafter withhold payments of all Dividends, bonus, or other monies payable in

respect of the Share or Debenture, until the requirements of the notice have been complied with.

A Depository may in terms of Section 58 A at any time, make a nomination and above provisions shall as

far as may be, apply to such nomination.”

Buy Back of Shares

Article 67 provides that “The Company shall be entitled to purchase its own Shares or other securities, subject to

such limits, upon such terms and conditions and subject to such approvals as required under Section 77 A and other

applicable provisions of the Act, The Securities and Exchange Board of India Act, 1992 and the Securities and

Exchange Board of India (Buy Back of Securities) Regulations 1998 and any amendments, modification(s),

repromulgation (s) or re- enactment(s) thereof.”

Rights to convert Shares into stock & vice-versa

Article 73 provides that “The Company in General Meeting may, by an Ordinary Resolution, convert any fully paid-

up shares into stock and when any Shares shall have been converted into stock the several holders of such stock,

may henceforth Transfer their respective interest therein, or any part of such interest in the same manner and subject

to the same Regulations as, and subject to which Shares from which the stock arise might have been transferred, if

no such conversion had taken place. The Company may, by an Ordinary Resolution reconvert any stock into fully

Paid up shares of any denomination. Provided that the Board may, from time to time, fix the minimum amount of

stock transferable, so however such minimum shall not exceed the nominal amount of Shares from which the stock

arose.”

Annual General Meetings

Article 75 provides that “The Company shall, in addition to any other meetings hold a General Meeting which shall

be called as its Annual General Meeting, at the intervals and in accordance with the provisions of the Act.”

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Extraordinary Meetings on requisition

Article 77 provides that “The Board shall on, the requisition of Members convene an Extraordinary General Meeting

of the Company in the circumstances and in the manner provided under Section 169 of the Act.”

Quorum for General Meeting

Article 81 provides that “Five Members or such other number of Members as the law for the time being in force

prescribes, shall be entitled to be personally present shall be quorum for a General Meeting and no business shall be

transacted at any General Meeting unless the requisite quorum is present at the commencement of the meeting.”

Voting at Meeting

Article 86 provides that “At any General Meeting, a resolution put to the vote at the meeting shall be decided on a

show of hands, unless a poll is (before or on the declaration of the result of the show of hands) is demanded in

accordance with the provisions of Section 179 of the Act. Unless a poll is so demanded, a declaration by the

Chairman that the resolution had, on a show of hands been carried unanimously or by a particular majority or lost

and an entry to that effect in the book of the proceedings of the Company shall be conclusive evidence of the fact

without proof of the number or proportion of the votes recorded in favour of or against that resolution.”

Casting vote of Chairman

Article 88 provides that “In case of equal votes, whether on a show of hands or on a poll, the Chairman of the

meeting at which the show of hands takes place or at which the poll is demanded shall be entitled to a second or a

casting vote in addition to the vote or votes to which he may be entitled to as a Member.”

Passing resolutions by Postal Ballot


“(a) Notwithstanding any of the provisions of these Articles the Company may, and in the case of resolutions

relating to such business as notified under the Companies (Passing of the Resolution by Postal Ballot)

Rules, 2001 to be passed by postal ballot, shall get any resolution passed by means of a postal ballot,

instead of transacting the business in the general meeting of the Company.

(b) Where the Company decides to pass any resolution by resorting to postal ballot, it shall follow the

procedures as prescribed under section 192A of the Act and the Companies (Passing of the Resolution by

Postal Ballot) Rules, 2001, as amended from time.”

No right to vote unless calls are paid

Article 93 provides that “No Member shall be entitled to vote at any General Meeting unless all calls or other sums

presently payable by him have been paid, or in regard to which the Company has lien and has exercised any right of

lien.”

Instrument of Proxy

Article 95 provides that “The instrument appointing a Proxy shall be in writing under the hand of appointer or of his

attorney duly authorized in writing or if appointed by a Corporation either under its common Seal or under the hand

of its attorney duly authorized in writing. Any person whether or not he is a Member of the Company may be

appointed as a Proxy.

The instrument appointing a Proxy and Power of Attorney or other authority (if any) under which it is signed must

be deposited at the registered office of the Company not less than forty eight hours prior to the time fixed for

holding the meeting at which the person named in the instrument proposed to vote, or, in case of a poll, not less than

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twenty four hours before the time appointed for the taking of the poll, and in default the instrument of Proxy shall

not be treated as valid.

Article 96 provides that “The form of Proxy shall be two way proxies as given in Schedule IX of the Act enabling

the Share holder to vote for/against any resolution.”

Number of Directors

Article 99 provides that “Unless otherwise determined by General Meeting, the number of Directors shall not be less

than three and not more than twelve, including all kinds of Directors.”

Share qualification not necessary

Article 100 provides that “Any person whether a Member of the Company or not may be appointed as Director and

no qualification by way of holding Shares shall be required of any Director.”

Director‟s power to fill-up casual vacancy

Article 101 provides that “Any casual vacancy occurring in the Board of Directors may be filled up by the Directors,

and the person so appointed shall hold office up to the date, up to which Director in whose place he is appointed

would have office if it has not been vacated as aforesaid”

Additional Directors

Article 102 provides that “The Board of Directors shall have power at any time and from time to time to appoint one

or more persons as Additional Directors provided that the number of Directors and Additional Directors together

shall not exceed the maximum number fixed. An additional Director so appointed shall hold office up to the date of

the next Annual general Meeting of the Company and shall be eligible for re-election by the Company at that

Meeting.”

Alternate Directors

Article 103 provides that “The Board of Directors may appoint an Alternate Director to act for a Director

(hereinafter called the original Director) during the absence of the original Director for a period of not less than 3

Months form the state in which the meetings of the Board are ordinarily held. An Alternate Director so appointed

shall vacate office if and when the original Director return to the state in which the meetings of the Board are

ordinarily held. If the term of the office of the original Director is determined before he so returns to the state

aforesaid any provision for the automatic reappointment of retiring Director in default of another appointment shall

apply to the original and not to the Alternate Director.”

Remuneration of Directors

Article 104 provides that “Every Director other than the Managing Director and the Whole-time Director shall be

paid a sitting fee not exceeding such sum as may be prescribed by the Act or the Central Government from time to

time for each meeting of the Board of Directors or any Committee thereof attended by him and shall be paid in

addition thereto all traveling, hotel and other expenses properly incurred by him in attending and returning from the

meetings of the Board of Directors or any committee thereof or General Meeting of the Company or in connection

with business of the Company to and from any place.”

Remuneration for extra services

Article 105 provides that “If any Director, being willing, shall be called upon to perform extra services or to make

any special exertions in going or residing away from the town in which the Registered Office of the Company may

be situated for any purposes of the Company or in giving any special attention to the business of the Company or as

Member of the Board, then subject to the provisions of the Act the Board may remunerate the Director so doing

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either by a fixed sum, or by a percentage of profits or otherwise and such remuneration, may be either in addition to

our in substitution for any other remuneration to which he may be entitled.”

Directors may contract with the Company

Article 116 provides that “Subject to the provisions of Section 297, 299, 300, 302 and 314 of the Act , the Directors

shall not be disqualified by reason of his or their office as such from contracting with the Company either as vendor,

purchaser, lender, agent, broker, lessor or otherwise nor shall any such contract, or arrangement entered into by or

on behalf of the Company with such Director or with any Company or partnership in which he shall be a Member or

otherwise interested be avoided nor shall any Director so contracting or being such Member or so interested be

liable to account to the Company for any profit realized by such contract or arrangement by reason only of such

Director holding that office or of fiduciary relation thereby established but the nature of the interest must be

disclosed by him or them at the meeting of Directors at which the contract or arrangement is determined if the

interest then exists or in any other case at the first meeting of the Directors after the acquisition of the interest.”

Quorum

Article 120 provides that “The quorum for a meeting of the Board shall be one-third (1/3rd

) of its total strength (any

fraction contained in that one-third being rounded off as one) or two Directors whichever is higher, provided that

where at any time the number of interested Directors is equal to or exceeds two-thirds of total strength, the number

of remaining Directors, that is to say the number of Directors who are not interested, present at the meeting being

not less than two, shall be the quorum during such time, The total strength of the Board shall mean the number of

Directors actually holding office as Directors on the date of the resolution or meeting, that is to say, the total

strength of Board after deducting there from the number of Directors, if any, whose places are vacant at the time.”

Power to Borrow


a) “The Board of Directors may from time to time but with such consent of the Company in General Meeting

as may be required under the Act raise any moneys or sums of money for the purpose of the Company

provided that the moneys to be borrowed by the Company apart from temporary loans obtained from the

Company‟s bankers in the ordinary course of business shall not, without the sanction of the Company at a

General Meeting, exceed the aggregate of the Paid up Capital of the Company and its free reserves, that is

to say, reserves not set apart for any specifies purpose and in particular, but subject to the provisions of

Section 292 of the Act, the Board may from time to time at their discretion raise or borrow or secure the

payment of any such sum of money for the purpose of the Company, by the issue of Debentures, perpetual

or otherwise, including debenture convertible into Shares of this or any other Company or perpetual

annuities and to secure any such money so borrowed, raised or received mortgage, pledge or charge the

whole or any part of the property, assets or revenue of the Company present or future, including its

uncalled Capital by special assignment or otherwise or to Transfer or convey the same absolutely or in

trust and to give the lenders powers of sale and other powers as may be expedient and to purchase, redeem

or pay off any such securities.

Provided that every resolution passed by the Company in General Meeting in relation to the exercise of the

power to borrow as stated shall specify the total amount up to which moneys may be borrowed by the

Board Directors.

b) The Directors may by resolution at a meeting of the Board delegate the above power to borrow money

otherwise than on Debentures to a committee of Directors or the Managing Director, if any, within the

limits prescribed.

c) Subject to provisions of the above sub-clause, the Directors may, from time to time, at their discretion, raise

or borrow or secure the repayment of any sum or sums of money for the purposes of the Company, at such

time and in such manner and upon such terms and conditions in all respects as they think, fit and in

375

particular, by promissory notes or by receiving deposits and advances with or without security or by the

issue of bonds, perpetual or redeemable Debentures (both present and future) including its uncalled Capital

for the time being or by mortgaging or charging or pledging any lands, buildings, goods or other property

and securities of the Company, or by such other means as they may seem expedient.

d) To the extent permitted under the applicable law and subject to compliance with the requirements thereof,

the Directors shall be empowered to grant loans to such entities at such terms as they may deem to be

appropriate and the same shall be in the interests of the Company.”

Nominee Directors


a) “So long as any moneys remain owing by the Company to any All India Financial Institutions, State

Financial Corporation or any financial institution owned or controlled by the Central Government or State

Government or any Non Banking Financial Company controlled by the Reserve Bank of India or or each

of the above has granted any loans / or subscribes to the Debentures of the Company or so long as any of

the aforementioned companies of financial institutions holds or continues to hold Debentures /Shares in the

Company as a result of underwriting or by direct subscription or private placement or so long as any

liability of the Company arising out of any guarantee furnished on behalf of the Company remains

outstanding, and if the loan or other agreement with such corporation so provides, the corporation shall

have a right to appoint from time to time any person or persons as a Director or Directors whole- time or

non whole- time (which Director or Director/s is/are hereinafter referred to as “Nominee Directors/s) on

the Board of the Company and to remove from such office any person or person so appointed and to

appoint any person or persons in his /their place(s).

b) The Board of Directors of the Company shall have no power to remove from office the Nominee

Director/s. At the option of the Corporation such Nominee Director/s shall not be liable to retirement by

rotation of Directors. Subject as aforesaid, the Nominee Director/s shall be entitled to the same rights and

privileges and be subject to the same obligations as any other Director of the Company.

The Nominee Director/s so appointed shall hold the said office only so long as any moneys remain owing

by the Company to the Corporation or so long as they holds or continues to hold Debentures/Shares in the

Company as result of underwriting or by direct subscription or private placement or the liability of the

Company arising out of the Guarantee is outstanding and the Nominee Director/s so appointed in exercise

of the said power shall vacate such office immediately on the moneys owing by the Company to the

Corporation are paid off or they ceasing to hold Debentures/Shares in the Company or on the satisfaction

of the liability of the Company arising out of the guarantee furnished.

c) The Nominee Director/s appointed under this Article shall be entitled to receive all notices of and attend all

General Meetings, Board Meetings and of the Meetings of the Committee of which Nominee Director/s

is//are Member/s as also the minutes of such Meetings. The Corporation shall also be entitled to receive all

such notices and minutes.

d) The Company shall pay the Nominee Director/s sitting fees and expenses to which the other Directors of

the Company are entitled, but if any other fees commission, monies or remuneration in any form is payable

to the Directors of the Company the fees, commission, monies and remuneration in relation to such

Nominee Director/s shall accrue to the nominee appointer and same shall accordingly be paid by the

Company directly to the Corporation.

e) Provided that the sitting fees, in relation to such Nominee Director/s shall also accrue to the appointer and

same shall accordingly be paid by the Company directly to the appointer.”

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Powers to be exercised by Board only by Meeting


a) “The Board of Directors shall exercise the following powers on behalf of the Company and the said powers

shall be exercised only by resolution passed at the meeting of the Board:

(i) Power to make calls on Shareholders in respect of moneys unpaid on their Shares;

(ii) Power to issue Debentures;

(iii) Power to borrow money otherwise than on Debentures:

(iv) Power to invest the funds of the Company;

(v) Power to make loans.

b) The Board of Directors may by a meeting delegate to any committee or the Directors or to the Managing

Director the powers specified in sub clauses (iii), (iv) and (v) above.

c) Every resolution delegating the power set out in sub clause (iii) above shall specify the total amount up to

which moneys may be borrowed by the said delegate.

d) Every resolution delegating the power referred to in sub-clause (iv) above shall specify the total amount, up

to which the fund may invested and the nature of the investments which may be made by the delegate.

e) Every resolution delegating the power referred to in sub-clause (v) above shall specify the total amount up

to which the loans may be made by the delegate, the purposes for which the loans may be made and the

maximum amount of loans which may be made for each such purpose in individual cases.”

Managing Director(s))/ Whole-Time Director(s)


a) “The Board may from time to time and with such sanction of the Central Government as may be required

by the Act, appoint one or more of the Directors to the office of the Managing Director or whole-time

Directors.

b) The Directors may from time to time resolve that there shall be either one or more Managing Directors or

Whole time Directors.

c) In the event of any vacancy arising in the office of a Managing Director or Whole-time Director, the

vacancy shall be filled by the Board of Directors subject to the approval of the Members.

d) If a Managing Director or whole time Director ceases to hold office as Director, he shall ipso facto and

immediately cease to be Managing Director/whole time Director.

e) The Managing Director or whole time Director shall not be liable to retirement by rotation as long as he

holds office as Managing Director or whole-time Director.”

Remuneration of Managing Directors/whole time Directors

Article 140 provides that “Subject to the provisions of the Act and subject to such sanction of Central

Government\Financial Institutions as may be required for the purpose, the Managing Directors\whole-time Directors

shall receive such remuneration (whether by way of salary commission or participation in profits or partly in one

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way and partly in another) as the Company in General Meeting may from time to time determine.”

Right to Dividend


a) “The profits of the Company, subject to any special rights, relating thereto created or authorized to be

created by these presents and subject to the provisions of the presents as to the Reserve Fund, shall be

divisible among the Members in proportion to the amount of capital Paid up on the Shares held by them

respectively and the last day of the year of account in respect of which such Dividend is declared and in the

case of interim Dividends on the close of the last day of the period in respect of which such interim

Dividend is paid.

b) Where Capital is paid in advance of calls, such Capital shall not, confer a right to participate in the profits.”

Declaration of Dividends

Article 146 provides that “The Company in General Meeting may declare Dividends but no Dividend shall exceed

the amount recommended by the Board.”

Interim Dividends

Article 147 provides that “The Board may from time to time pay to the Members such interim Dividends as appear

to them to be justified by the profits of the Company.”

Dividends to be paid out of profits

Article 148 provides that “No Dividend shall be payable except out of the profits of the year or any other

undistributed profits except as provided by Section 205 of the Act.”

Dividends not be bear interest

Article 154 provides that “No Dividends shall bear interest against the Company.”

Capitalisation of Profits


a) “The Company in General Meeting, may, on recommendation of the Board resolve:

(i) That it is desirable to capitalise any part of the amount for the time being standing to the credit of

the Company‟s reserve accounts or to the credit of the profit and loss account or otherwise

available for distribution; and

(ii) That such sum is accordingly set free for distribution in the manner specified in the sub-clause (b)

amongst the Members who would have been entitled thereto if distributed by way of Dividend and

in the same proportion.

b) The sum aforesaid shall not be paid in cash but shall be applied, either in or towards:

(i) Paying up any amounts for the time being unpaid on Shares held by such Members respectively

(ii) Paying up in full, unissued Share of the Company to be allotted and distributed, credited as fully

Paid up, to and amongst such Members in the proportions aforesaid; or

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(iii) Partly in the way specified in sub-clause (i) and partly that specified in sub clause (ii)

c) The Board shall give effect to the resolution passed by the Company in pursuance of this regulation.

d) A Share premium account and a Capital redemption reserve account may, only be applied in the paying up

of unissued Shares to be issued to Members of the Company as fully paid bonus Shares.”

Power of Directors for declaration of bonus issue


a) “Whenever such a resolution as aforesaid shall have been passed, the Board shall:

(i) make all appropriations and applications of the undivided profits resolved to be capitalized thereby

and all allotments and issues of fully paid Shares, if any, and

(ii) generally do all acts and things required to give effect thereto.

b) The Board shall have full power:

(i) to make such provisions, by the issue of fractional certificates or by payments in cash or otherwise

as it thinks fit, in the case of Shares or Debentures becoming distributable in fraction; and also

(ii) to authorize any person, on behalf of all the Members entitled thereto, to enter into an agreement

with the Company providing for the allotment to such Members , credited as fully paid up, of any

further Shares or Debentures to which they may be entitled upon such capitalization or (as the case

may require) for the payment of by the Company on their behalf, by the application thereto of their

respective proportions of the profits resolved to the capitalised of the amounts or any parts of the

amounts remaining unpaid on the Shares.

c) Any agreement made under such authority shall be effective and binding on all such Members.”

Division of assets of the Company in specie among Members

Article 177 provides that “If the Company shall be wound up whether voluntarily or otherwise, the liquidators may

with sanction of a Special Resolution divide among the contributories in specie or kind any part of the assets of the

Company and any with like sanction vest any part of the assets of the Company in trustees upon such trusts for the

benefit of the contributories of any of them, as the liquidators with the like sanction shall think fit, in case any Share

to be divided as aforesaid involve as liability to calls or otherwise any persons entitled under such division to any of

the said Shares may within ten days after the passing of the Special Resolution by notice in writing, direct the

liquidators to sell his proportion and pay them the net proceeds, and the liquidators shall, if practicable, act

accordingly.”

Director‟s and others‟ right to indemnity


a) “Subject to the provisions of the Act, the Managing Director and every Director, Manager, Secretary and

other Officer or Employee of the Company shall be indemnified by the Company against any liability and it

shall be the duty of Directors, out of the funds of the Company to pay, all costs and losses and expenses

(including traveling expenses) which any such Director, Officer or Employee may incur or become liable to

by reason of any contract entered into or act or deed done by him as such Managing Director, Director,

Officer or Employee or in any way in the discharge of his duties.

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b) Subject as aforesaid the Managing Director and every Director, Manager, Secretary or other Officer or

Employee of the Company shall be indemnified against any liability incurred by them or in defending any

proceeding whether civil or criminal in which judgment is given in their or his favour or in which he is

acquitted or discharged or in connection with any application under Sec. 633 of the Act in which relief is

given to him by the Court.”

Secrecy

Article 180 provides that “No Member shall be entitled to inspect the Company‟s works without the permission of

the Managing Director or to require discovery of any information respectively any detail of the Company‟s trading

or any matter which is or may be in the nature of a trade secret, history of trade or secret process which may be

related to the conduct of the business of the Company and which in the opinion of the Managing Director it will be

inexpedient in the interest of the Members of the Company to communicate to the public.”

Duties of Officers to observe secrecy

Article 181 provides that “Every Director, Managing Directors, Manager, Secretary, Auditor, Trustee, Members of

Committee, Officer, Servant, Agent, Accountant or other persons employed in the business of the Company shall, if

so required by the Director before entering upon his duties, or any time during his term of office, sign a declaration

pledging himself to observe secrecy relating to all transactions of the Company and the state of accounts and in

matters relating thereto and shall by such declaration pledge himself not to reveal any of such matters which may

come to his knowledge in the discharge of his official duties except which are required so to do by the Directors or

any meeting or by a Court of Law and except so far as may be necessary in order to comply with any of the

provision of these Articles or law.”

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SECTION IX: OTHER INFORMATION

MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The copies of the following contracts which are or may be deemed material have been entered into or will be

entered into by the Company (not being contracts entered into in the ordinary course of business carried on by the

Company or contracts entered into more than two years before the date of this Draft Red Herring Prospectus) will

be attached to the copy of the Red Herring Prospectus to be delivered to the RoC for registration. Copies of these

documents will be available for inspection at the Registered Office, from 10.00 am to 4.00 pm on all working days

from the date of filing of the Red Herring Prospectus delivered to the RoC for registration until the Bid/Issue

Closing Date.

A. Material Contracts to the Issue

1. Letter of Engagement dated June 18, 2010 issued by the Company for the appointment of the BRLMs.

2. Issue Agreement dated July 2, 2010 between the Company and the BRLMs.

3. Memorandum of Understanding dated June 16, 2010 between the Company and the Registrar to the Issue.

4. Escrow Agreement dated [●] between the Company, the BRLMs, the Escrow Collection Banks and the

Registrar to the Issue.

5. Syndicate Agreement dated [●] between the Company, the BRLMs and the Syndicate Members.

6. Underwriting Agreement dated [●] between the Company and the Underwriters.

B. Material Documents

1. Certified copies of our Memorandum and Articles of Association as amended.

2. Certificate of Incorporation dated February 5, 2010 consequent upon change of status from private limited

company to public limited company and consequent change in the name of the Company to „Entertainment

World Developers Limited‟.

3. Resolution of the Board of Directors of the Company dated June 11, 2010 approving this Issue and other

related matters.

4. Shareholders‟ resolution dated June 15, 2010 approving this Issue and other related matters.

5. Statement of tax benefits from, M/s. Deloitte Haskins & Sells, Chartered Accountants dated June 9, 2010.

6. The report of M/s. Deloitte Haskins & Sells, Chartered Accountants, the statutory auditors, dated June 11,

2010, prepared as per Indian GAAP and mentioned in this Draft Red Herring Prospectus together with

copies of balance sheet and profit and loss account of the Company for the years ended March 31, 2006,

2007, 2008, 2009 and 2010.

7. Consent of M/s. Deloitte Haskins & Sells, Chartered Accountants for inclusion of their names as the

statutory auditors and of their reports on accounts in the form and context in which they appear in this Draft

Red Herring Prospectus and statement of tax benefits in the form and context in which they appear in the


8. Copies of annual reports of the Company for the last five financial years.

9. Consents of Bankers to the Company, BRLMs, Syndicate Members, Registrar to the Issue, Escrow

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Collection Bank(s), Bankers to the Issue, Legal Advisors to the Issue, IPO Grading Agency, Directors,

Company Secretary and Compliance Officer, Architects as referred to, in their respective capacities.

10. Architect certificates dated May 31, 2010 from P.G. Patki Architects, The Design Syndicate and Sanjay

Puri Architects.

11. Certificates dated June 9, 2010 issued by R.L. Porwal & Co. in relation to the Objects of the Issue.

12. Certificate dated July 2, 2010 issued by R.L. Porwal & Co. in relation to the aggregate advance bookings

for three residential projects launched by the Company.

13. Initial listing applications dated July 12, 2010 and July 12, 2010 filed with the BSE and the NSE

respectively.

14. In-principle listing approvals dated [●] and [●] from the BSE and the NSE respectively.

15. Tripartite Agreement between the Company, NSDL and the Registrar to the Issue dated [●].

16. Tripartite Agreement between the Company, CDSL and the Registrar to the Issue dated [●].

17. IPO Grading Report dated [●] by [●].

18. Due diligence certificate dated July 12, 2010 to SEBI from the BRLMs.

19. SEBI observation letter no. [●] dated [●].

C. Material Agreements

1. Securities subscription and shareholders‟ agreement dated November 1, 2006 between the Company, IAF -

III, Promoters and Ashok Ruia Enterprises Private Limited (merged with PML).

2. Letters dated January 25, 2010, May 3, 2010 and July 2, 2010 between the Company, IAF - III, Promoters

and Ashok Ruia Enterprises Private Limited (merged with PML).

3. Letter dated June 18, 2010 between the Promoters, PML and Kalani Holdings Private Limited (a wholly

owned subsidiary of PML).

4. Deed of adherence and modification to the securities subscription and shareholders agreement dated July 9,

2010 between the Company, the Promoters, IAF - III, Kalani Holdings Private Limited (a wholly owned

subsidiary of PML) and PML.

5. Shareholders Agreement dated June 17, 2006 among the Company, Kshitij Venture Capital Fund and

Naman Mall Management Company Private Limited.

Any of the contracts or documents mentioned in this Draft Red Herring Prospectus may be amended or modified at

any time if so required in the interest of the Company or if required by the other parties, without reference to the

shareholders subject to compliance of the provisions contained in the Companies Act and other relevant statutes.

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DECLARATION

All relevant provisions of the Companies Act and the guidelines issued by the Government or the regulations or

guidelines issued by SEBI, established under Section 3 of the SEBI Act, as the case may be, have been complied

with and no statement made in this Draft Red Herring Prospectus is contrary to the provisions of the Companies Act,

the SEBI Act or rules or regulations made thereunder or guidelines issued, as the case may be. We further certify

that all the statements in this Draft Red Herring Prospectus are true and correct.

SIGNED BY THE DIRECTORS OF THE COMPANY

________________________

Manish Kalani

(Managing Director)

________________________

B. Rajesh Nair

(Executive Director)

________________________

Sudarshan Bajoria

(Non-Executive, Non Independent Director)

________________________

Atul Ruia

(Non-Executive, Non Independent Director)

________________________


(Non- Executive, Non Independent Director)

________________________

Paras Nath Pathak

(Non-Executive, Independent Director)

________________________

Mukesh Kacker


________________________

Girish Raj


________________________

Homi Aibara


________________________

Suhail Nathani


Date: July 12, 2010

________________________

Yagnesh Sanghrajka* * (responsible for discharging all finance related functions for the

EWDL group.)

Place: Mumbai

Entertainment World Developers Ltd.

Documents

Transcript of Entertainment World Developers Ltd.