TEJORA TECHNOLOGIES LIMITED

transcript

TEJORA TECHNOLOGIES LIMITEDOur Company was originally incorporated as ‘RTEngines Software Private Limited’ a private limited company under the Companies Act pursuant to Certificate of Incorporation dated April 28, 2003 issued by the Assistant Registrar of Companies, Maharashtra, Mumbai. The name of our Company was changed to ‘Tejora Technologies Private Limited’ pursuant to fresh certificate of incorporation consequent upon change of name dated March 29, 2011 issued by the Assistant Registrar of Companies, Maharashtra, Mumbai. Thereafter our Company was converted into a public limited company under the Companies Act and the name of our Company was changed to ‘Tejora Technologies Limited’ pursuant to fresh certificate of incorporation consequent upon change of name on conversion to public limited company dated April 8, 2011 issued by the Deputy Registrar of Companies, Maharashtra, Mumbai. Our corporate identification number is U72900MH2003PLC140182. For further details of our Company, please refer to the chapters titled ‘General Information’ and ‘History and Certain Corporate Matters’ beginning on pages 8 and 74 respectively, of the Draft Red Herring Prospectus.

Registered Office: Unit No.2, A Wing, 8th Floor, Prism Tower, Mindspace, Goregaon (West), Mumbai – 400 064, Maharashtra.Tel. No.: +91 22 4003 4222; Fax No.: +91 22 4003 4226;

Company Secretary and Compliance Officer: Rohit Kudtarkar; Email: cs@tejora.com; Website: www.tejora.comPROMOTERS: HARIDAS SHENOY, NITIN SHENOY AND SURABHI SHENOY

PUBLIC ISSUE OF 40,00,000 EQUITY SHARES OF FACE VALUE ` 10 EACH OF TEJORA TECHNOLOGIES LIMITED (“COMPANY” OR “ISSUER”) FOR CASH AT A PRICE OF ` [●] PER EQUITY SHARE (INCLUDING A SHARE PREMIUM OF ` [●] PER EQUITY SHARE) AGGREGATING ` [●] LACS (THE “ISSUE”). THE ISSUE WILL CONSTITUTE 30.75 % OF THE FULLY DILUTED POST ISSUE PAID-UP EQUITY SHARE CAPITAL OF THE COMPANY. THE FACE VALUE OF THE EQUITY SHARES IS ` 10 EACH. THE PRICE BAND AND THE MINIMUM BID LOT WILL BE DECIDED BY THE COMPANY IN CONSULTATION WITH THE BOOK RUNNING LEAD MANAGER AND ADVERTISED AT LEAST TWO WORKING DAYS PRIOR TO THE BID/ISSUE OPENING DATE.In case of any revision in the Price Band, the Bid / Issue Period shall be extended for at least three additional Working Days after such revision of the Price Band, subject to the total Bidding Period not exceeding 10 Working Days. Any revision in the Price Band, and the revised Bidding Period, if applicable, shall be widely disseminated by notification to the Self Certified Syndicate Banks (“SCSBs”), the National Stock Exchange of India Limited (“NSE”) and the Bombay Stock Exchange Limited (“BSE”), by issuing a press release and also by indicating the change on the website of the Book Running Lead Manager (“BRLM”) and at the terminals of the other members of the Syndicate.This being an Issue for Equity Shares representing more than 25% of the post-Issue equity share capital of the Company, Equity Shares will be offered to the public for subscription in accordance with Rule 19(2)(b)(i) of the Securities Contracts (Regulation) Rules, 1957, as amended ("SCRR"), and the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended ("SEBI ICDR Regulations"). The Issue is being made pursuant to Regulation 26(1) of the SEBI ICDR Regulations through the 100% Book Building Process wherein not more than 50% of the Issue shall be allocated on a proportionate basis to Qualified Institutional Buyers (“QIBs”) (“QIB Portion”). 5% of the QIB 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. All non-retail Bidders, shall participate in this Issue through the Application Supported by Blocked Amount ("ASBA") process. Retail Bidders participating in this Issue may also utilise the ASBA process to submit their Bids. For details, please refer to the chapter titled ‘Issue Procedure’ beginning on page 149 of the Draft Red Herring Prospectus.

RISKS IN RELATION TO FIRST ISSUEThis being the first public issue of the Issuer, there has been no formal market for our Equity Shares. The face value of the Equity Shares of our Company is ` 10. The Floor Price is [●] times of the face value and the Cap Price is [●] times of the face value. The Issue Price (as determined by our Company in consultation with the BRLM, on the basis of the assessment of market demand for the Equity Shares by way of the Book Building Process and as stated in the chapter titled ‘Basis for the Issue Price’ beginning on page 40 of the Draft Red Herring Prospectus) should not be taken to be indicative of the market price of the Equity Shares after such Equity Shares are listed. No assurance can be given regarding an active and/or sustained trading in the Equity Shares or regarding the price at which the Equity Shares will be traded after listing.

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. For taking an investment decision, investors must rely on their own examination of the Issuer and this Issue, including the risks involved. The Equity Shares 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 of the Draft Red Herring Prospectus. Specific attention of the investors is invited to the section titled ‘Risk Factors’ beginning on page xv of the Draft Red Herring Prospectus.

IPO GRADINGThe Issue has been graded by [●], as [●] indicating [●]. The IPO grading is assigned on a scale of 1 to 5, with ‘IPO Grade 5’ indicating strong fundamentals and ‘IPO Grade 1’ indicating poor fundamentals. The Issue has not been graded by any other rating agency. For details regarding the grading of the Issue, please refer to the chapter titled ‘General Information’ beginning on page 8 of the Draft Red Herring Prospectus.

ISSUER’S ABSOLUTE RESPONSIBILITYThe Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that the Draft Red Herring Prospectus contains all information with regard to the Issuer and this Issue, which is material in the context of this Issue, that the information contained in the 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 makes the 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 of our Company offered through the Red Herring Prospectus are proposed to be listed on the BSE and the NSE. Our Company has received in-principle approval from the BSE pursuant to letter dated [•] and from the NSE pursuant to letter dated [•] for the listing of our Equity Shares. BSE shall be the Designated Stock Exchange for this Issue.

BOOK RUNNING LEAD MANAGER REGISTRAR TO THE ISSUE

Unicon Capital Services Private Limited3rd Floor, ‘A’ wing, Vilco Center8, Subhash Road, Vile Parle (East)Mumbai – 400 057MaharashtraTel No: +91–22–3390 1234Fax No: +91–22–3390 1547Website: www.uniconindia.inEmail: mb@unicon.in Investor Grievance ID: investors@unicon.in Contact Person: Pritam Pandya/ Ganesh HadvaleSEBI Registration No: INM000011609

Bigshare Services Private LimitedE-2, Ansa Industrial Estate,Sakivihar Road, Saki Naka,Andheri (East),Mumbai – 400 072MaharashtraTel No: +91–22 – 4043 0200Fax No: +91–22– 2847 5207Website: www.bigshareonline.comEmail: ipo@bigshareonline.comContact Person: Ashok ShettySEBI Registration No: INR000001385

BID/ISSUE PROGRAMMEFOR ALL BIDDERS BID / ISSUE OPENS ON [●]

FOR QIBS* BID / ISSUE CLOSES ON [●]FOR NON- INSTITUTIONAL AND RETAIL BIDDERS BID / ISSUE CLOSES ON [●]

* Our Company may consider closing the Bidding by QIBs one day prior to the Bid / Issue Closing Date subject to the Bid / Issue Period being for a minimum of three Working days.

Draft Red Herring ProspectusJuly 9, 2011

Please read Section 60B of the Companies Act, 1956Book Building Issue

(The Draft Red Herring Prospectus will be updated upon RoC filing)

Tejora Technologies Limited

SECTION I – GENERAL ..................................................................................................................................... III

DEFINITIONS AND ABBREVIATIONS....................................................................................................... III

PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA ................................................. XII

FORWARD LOOKING STATEMENTS ..................................................................................................... XIII

SECTION II - RISK FACTORS .........................................................................................................................XV

SECTION III – INTRODUCTION ........................................................................................................................ 1

SUMMARY OF OUR INDUSTRY ................................................................................................................... 1

SUMMARY OF OUR BUSINESS .................................................................................................................... 3

SUMMARY OF OUR FINANCIAL INFORMATION ..................................................................................... 4

THE ISSUE ........................................................................................................................................................ 7

GENERAL INFORMATION............................................................................................................................. 8

CAPITAL STRUCTURE ................................................................................................................................. 17

OBJECTS OF THE ISSUE .............................................................................................................................. 27

BASIC TERMS OF THE ISSUE ..................................................................................................................... 37

BASIS FOR ISSUE PRICE .............................................................................................................................. 40

STATEMENT OF TAX BENEFITS................................................................................................................ 42

SECTION IV – ABOUT THE COMPANY ........................................................................................................ 47

INDUSTRY OVERVIEW ................................................................................................................................ 47

OUR BUSINESS .............................................................................................................................................. 57

KEY REGULATIONS AND POLICIES ......................................................................................................... 70

HISTORY AND CERTAIN CORPORATE MATTERS ................................................................................. 74

OUR MANAGEMENT .................................................................................................................................... 79

OUR PROMOTERS AND PROMOTER GROUP .......................................................................................... 91

OUR GROUP ENTITIES ................................................................................................................................. 95

DIVIDEND POLICY ....................................................................................................................................... 98

SECTION V – FINANCIAL INFORMATION .................................................................................................. 99

FINANCIAL INFORMATION ........................................................................................................................ 99

MANAGEMENT‟S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND

RESULTS OF OPERATIONS ....................................................................................................................... 119

FINANCIAL INDEBTEDNESS .................................................................................................................... 127

SECTION VI – LEGAL AND OTHER INFORMATION .............................................................................. 128

OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS .................................................... 128

GOVERNMENT AND OTHER APPROVALS ............................................................................................ 131

OTHER REGULATORY AND STATUTORY DISCLOSURES ................................................................. 133

SECTION VII - ISSUE RELATED INFORMATION ..................................................................................... 144

TERMS OF THE ISSUE ................................................................................................................................ 144

ISSUE STRUCTURE ..................................................................................................................................... 147

ISSUE PROCEDURE .................................................................................................................................... 149

RESTRICTIONS ON FOREIGN OWNERSHIP OF INDIAN SECURITIES .............................................. 184

SECTION VIII – MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION ................................... 185

SECTION IX – OTHER INFORMATION ....................................................................................................... 223

MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION ....................................................... 223

DECLARATION ............................................................................................................................................ 225

Tejora Technologies Limited – Draft Red Herring Prospectus

SECTION I – GENERAL

DEFINITIONS AND ABBREVIATIONS

In the Draft Red Herring Prospectus, unless the context otherwise requires, the terms defined and abbreviations

stated hereunder shall have the meanings as assigned therewith as stated in this Section.

Company Related Terms

Term Description

“the Company”, “our Company”,

“Issuer”, “Issuer Company”, “we”,

“us”, “our”

Tejora Technologies Limited, a public limited company incorporated

under the Companies Act, 1956, and having its registered office at Unit

No.2, A Wing, 8th

Floor, Prism Tower, Mindspace, Goregaon (West),

Mumbai – 400 064, Maharashtra

Articles or Articles of Association

or AoA or our Articles

The Articles of Association of our Company, as amended from time to

Board, Board of Directors or our

The Board of Directors of our Company, duly constituted from time to

time, including any committee thereof

Director(s) The Director(s) of our Company

Memorandum, our Memorandum

or Memorandum of Association or

The Memorandum of Association of our Company, as amended from time

to time

Our Group Entities Such entities as are included in the chapter titled „Our Group Entities‟

beginning on page 95 of the Draft Red Herring Prospectus

Our Promoters Haridas Shenoy, Nitin Shenoy and Surabhi Shenoy

Registered and Corporate Office/

Registered Office

The registered and corporate office of our Company, situated at Unit

No.2, A Wing, 8th

Mumbai – 400 064, Maharashtra RoC / Registrar of Companies,

Mumbai

The Registrar of Companies located at Everest Building, 100, Marine

Drive, Mumbai – 400 002, Maharashtra

Peer Review Auditor The peer review auditor of our Company being, M/s. L. T. Jadav & Co.,

Chartered Accountants

Statutory Auditor The statutory auditor of our Company, being, M/s. Gopal Rao &

Associates, Chartered Accountants

Issue Related Terms

Term Description

“Issue” or “the Issue” or “this

Issue” Public Issue of 40,00,000 Equity Shares of face value of ` 10 each for cash at

a price of ` [●] per Equity Share (including share premium of ` [●] per

Equity Share) aggregating to ` [●] lacs

“you”, “your” or “yours” All such references are to the Bidders to the Issue, unless the context

otherwise specifies

Allocation / Allocation of

Equity Shares

Unless the context otherwise requires, the allocation of Equity Shares

pursuant to this Issue to the successful Bidders

Allot / Allotted / Allotment/

Allotment of Equity Shares

Unless the context otherwise requires, means the allotment of Equity Shares

pursuant to this Issue to successful Bidders

Allotment Advice The note or advice or intimation of Allotment, sent to each successful Bidder

who has been or is to be Allotted the Equity Shares after discovery of the

Issue Price in accordance with the Book Building Process, including any

revisions thereof

Allottee A successful Bidder to whom the Equity Shares are Allotted pursuant to this

Application Supported by

Blocked Amount/ ASBA

An application, whether physical or electronic, used by all Bidders to make a

Bid authorising a SCSBs to block the Bid Amount in a specified bank

account maintained with the SCSBs

ASBA Account Account maintained with a SCSBs which will be blocked by such SCSBs to

the extent of the appropriate Bid Amount of the ASBA Bidder, as specified

in the ASBA Bid cum Application Form.

ASBA Bid cum Application

Form / ASBA Form

The form, whether physical or electronic, used by an ASBA Bidder to submit

a Bid, which contains an authorisation to block the Bid Amount in an ASBA

Term Description

Account and would be considered as an application for Allotment to ASBA

Bidders in terms of the Red Herring Prospectus and the Prospectus

Pursuant to SEBI circular number CIR/CFD/DIL/7/2010 dated July 13, 2010,

ASBA Bid cum Application Forms shall be made available for download

from the respective websites of the Stock Exchange(s)

ASBA Bidder(s) Any prospective investor(s) in this Issue who Bid/ apply through the ASBA

process

Pursuant to SEBI circular number CIR/CFD/DIL/1/2011 dated April 29,

2011, non-retail Investors i.e. QIBs and Non-Institutional Investors

participating in this Issue are required to mandatorily use the ASBA facility

to submit their Bids

ASBA Revision Form The form, whether physical or electronic, used by an ASBA Bidder to

modify the quantity of Equity Shares or the Bid Amount in any of his/her

ASBA Bid cum Application Form or any previous ASBA Revision Form(s)

Pursuant to SEBI circular number CIR/CFD/DIL/7/2010 dated July 13, 2010,

ASBA Revision Forms shall be made available for download from the

respective websites of the Stock Exchange(s)

Banker(s) to the Issue/

Escrow Collection Bank(s)

The bank(s) which are clearing members and registered with SEBI as Banker

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

being [●]

Bankers to our Company Such entities which are disclosed as Bankers to our Company in the chapter

titled „General Information‟ beginning on page 8 of the Draft Red Herring

Prospectus

Basis of Allotment / Basis of

Allocation

The basis on which Equity Shares will be Allotted / Allocated to successful

Bidders pursuant to the Issue and which is described under chapter titled

„Issue Procedure‟ beginning on page 149 of the Draft Red Herring

Prospectus

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

Form and payable by a Bidder on submission of a Bid in the Issue and in

case of ASBA Bidders, the amount mentioned in the ASBA Bid cum

Application Form

Bid cum Application Form The form used by a Bidder to make a Bid including the ASBA Bid cum

Application Form (as applicable), which will be considered as the application

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

Prospectus

Bid(s) An indication to make an offer during the Bid / Issue Period by the Bidders,

pursuant to submission of the Bid cum Application Form or ASBA Form as

the case may be, to subscribe to the Equity Shares of our Company in this

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

modifications if any, made to such Bid(s)

Bid / Issue Closing Date The date after which the members of the Syndicate and the designated

branches of the SCSBs shall not accept any Bids for the Issue, which shall be

a date notified in two national daily newspapers (one each in English and in

Hindi) of wide circulation, and one regional (Marathi) daily newspaper of

wide circulation, where the Registered Office of our Company is situated.

Our Company may consider closing the Bidding by QIB Bidders one

Working Day prior to the Bid / Issue Closing Date, which shall also be

notified in the said advertisement in two national daily newspapers (one each

in English and in Hindi) of wide circulation, and one regional (Marathi) daily

newspaper of wide circulation, where the Registered Office of our Company

is situated

Bid / Issue Opening Date The date on which the members of the Syndicate and the SCSBs shall start

accepting Bids for the Issue, which shall be a date notified in two national

daily newspapers (one each in English and in Hindi) of wide circulation and

one regional (Marathi) daily newspaper of wide circulation, where the

Registered Office of our Company is situated

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

Date, both days inclusive, during which prospective Bidders and the ASBA

Term Description

Bidders can submit their Bids, including any revisions thereof

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

Herring Prospectus and the Bid cum Application Form including an ASBA

Bidder who Bids through an ASBA Bid cum Application Form

Book Building Process / Book

Building Method

The book building route as provided under Schedule XI of the SEBI ICDR

Regulations, in terms of which this Issue is being made

BRLM / Book Running Lead

Manager

Book Running Lead Manager to the Issue, in this case being Unicon Capital

Services Private Limited

Business Day Any day on which commercial banks in Mumbai are open for business

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

Compliance Officer The Company Secretary of our Company, being Rohit Kudtarkar

Controlling Branches Such branches of the SCSBs which coordinate under this Issue by the ASBA

Bidders with the BRLM, the Registrar to the Issue and the Stock Exchanges,

a list of which is available at http://www.sebi.gov.in/pmd/scsb/html

Cut-off Price Any price within the Price Band finalised by our Company in consultation

with the Book Running Lead Manager. Only Retail Individual Bidders are

entitled to Bid at the Cut-off Price, for a Bid Amount not exceeding ` 2 lacs.

No other category of Bidders are entitled to Bid at the Cut-off Price

Demographic Details The demographic details of the Bidders such as their address, PAN,

occupation and bank account details.

Depositories Depositories registered with the SEBI under the Securities and Exchange

Board of India (Depositories and Participants) Regulations, 1996, as

amended from time to time, being NSDL and CDSL

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

Application Form used by ASBA Bidders, a list of which is available at

http://www.sebi.gov.in/pmd/scsb/html

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

Public Issue Account or the Refund Account, as appropriate, or the amount

blocked by the SCSBs is transferred from the ASBA Account specified by

the ASBA Bidder to the Public Issue Account, as the case may be, after the

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

shall Allot Equity Shares to successful Bidders

Designated Stock Exchange The Bombay Stock Exchange Limited

Draft Red Herring Prospectus

or DRHP

The draft red herring prospectus dated July 9, 2011 issued in accordance with

Section 60B of the Companies Act and SEBI ICDR Regulations, filed with

SEBI and which does not contain complete particulars of the price at which

the Equity Shares would be issued and the size of the Issue

Eligible NRIs NRIs 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 offered

herein

Equity Shares Equity shares of our Company of face value of ` 10 each, fully paid up,

unless otherwise specified in the context thereof

Escrow Account(s) Account opened with the Escrow Collection Bank(s) for the Issue and in

whose favour the Bidder (excluding ASBA Bidders) will issue cheques or

drafts in respect of the Bid Amount when submitting a Bid

Escrow Agreement Agreement to be entered into by our Company, the Registrar to the Issue, the

BRLM, the Syndicate Members and the Escrow Collection Bank(s) for

collection of the Bid Amounts and where applicable, refunds of the amounts

collected from the Bidders (excluding ASBA Bidders) on the terms and

conditions thereof

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

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

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

Issue Agreement The agreement dated July 1, 2011 entered into by our Company and the

BRLM, pursuant to which certain arrangements are agreed to, in relation to

the Issue

Term Description

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

of the Red Herring Prospectus. The Issue Price will be decided by our

Company in consultation with the BRLM on the Pricing Date

Issue Proceeds Proceeds from the Issue that will be available to our Company, being ` [●]

Listing Agreement Equity listing agreements to be entered into by our Company with the Stock

Exchange(s)

Mutual Fund Portion 5% of the QIB Portion or 1,00,000 Equity Shares available for allocation to

Mutual Funds, out of the QIB Portion

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

Regulations, 1996, as amended from time to time

Net Proceeds The Issue Proceeds less the Issue related expenses. For further information

about use of the Issue Proceeds and the Issue related expenses, please refer to

the chapter titled „Objects of the Issue‟ beginning on page 27 of the Draft

Red Herring Prospectus

NIF National Investment Fund set up by resolution F. No. 2/3/2005-DD-II dated

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

Non-Institutional Bidders As defined in the SEBI ICDR Regulations and includes all Bidders including

sub-accounts of FIIs registered with SEBI, which are foreign corporates or

foreign individuals, that are not QIBs or Retail Individual Bidders and who

have Bid for Equity Shares for a cumulative amount more than ` 2 lacs (but

not including NRIs other than eligible NRIs)

Non-Institutional Portion The portion of the Issue being not less than 15% of the Issue, consisting of

6,00,000 Equity Shares, available for Allocation to Non Institutional Bidders

on a proportionate basis, subject to receipt of valid Bids at or above the Issue

NR / Non-Resident A person resident outside India, as defined under FEMA including eligible

NRIs and FIIs

NRI(s) / Non Resident Indian A “person resident outside India”, as defined under FEMA and who is a

citizen of India or is a person of Indian origin (as defined under the Foreign

Exchange Management (Deposit) Regulations, 2000, as amended)

OCB(s) / Overseas Corporate

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 Foreign Exchange Management

(Deposit) Regulations, 2000. OCBs are not allowed to invest in this Issue.

Pay-in-Period / Pay-in Period The period commencing on the Bid / Issue Opening Date and continuing till

the Bid / Issue Closing Date

Payment through electronic

transfer of funds

Payment made through NECS, Direct Credit or NEFT, as applicable

Price Band Price band of a minimum price (Floor Price) of ` [●] and the maximum price

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

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

consultation with the BRLM and advertised at least two Working Days prior

to the Bid / Issue Opening Date, in two national daily newspapers (one each

in English and in Hindi) of wide circulation, and one regional (Marathi) daily

newspaper, of wide circulation, where the Registered Office of our Company

is situated

Pricing Date The date on which our Company in consultation with the BRLM, 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

additional information

Public Issue Account Account opened with the Bankers to the Issue by our Company to receive

monies from the Escrow Account and the SCSBs from the bank accounts of

the ASBA Bidders on the Designated Date

QIB Portion The portion of the Issue being not more than 50% of the Issue, consisting of

not more than 20,00,000 Equity Shares, available for Allocation to QIBs,

subject to receipt of valid Bids at or above the Issue Price.

Term Description

Qualified Institutional Buyers

or QIBs

As defined under the SEBI ICDR Regulations, including public financial

institutions as specified in Section 4A of the Companies Act, scheduled

commercial banks, mutual fund registered with SEBI, FII and sub-account

(other than a sub-account which is a foreign corporate or foreign individual)

registered with SEBI, multilateral and bilateral development financial

institution, venture capital fund registered with SEBI, foreign venture capital

investor registered with SEBI, state industrial development corporation,

insurance company registered with Insurance Regulatory and Development

Authority, provident fund with minimum corpus of ` 2,500 lacs, pension

fund with minimum corpus of ` 2,500 lacs, NIF and insurance funds set up

and managed by army, navy or air force of the Union of India, insurance

funds set up and managed by the Department of Posts, India

Red Herring Prospectus / 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 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 the Prospectus upon filing with the

RoC after the Pricing Date

Refund Account(s) No-lien account maintained by the Refund Bank(s) to which the surplus

money shall be transferred and from which refunds of the whole or part of

the Bid Amount (excluding that of the ASBA Bidders), if any, shall be made.

Refund Bank (s) / Refund

Banker(s)

The bank(s) which have been appointed / designated for the purpose of

refunding the amount to investors either through the electronic mode as

prescribed by SEBI and / or physical mode in accordance with the procedure

contained in the chapter titled „Issue Procedure‟ beginning on page 149 of

the Draft Red Herring Prospectus

Refunds through electronic

transfer of funds

Refunds made through ECS / NECS, Direct Credit, NEFT or the ASBA

process, as applicable

Registrar to the Issue Registrar to this Issue, being Bigshare Services Private Limited

Resident Retail Individual

Bidder / Resident Retail

Individual Investor

A Retail Individual Bidder who is a “person resident in India” (as defined in

FEMA).

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

than ` 2 lacs in any of the bidding options in the Issue (includes HUFs

applying through their Karta and does not include NRIs other than Eligible

Retail Portion The portion of the Issue being not less than 35% of the Issue, consisting of

14,00,000 Equity Shares, available for Allocation to Retail Individual

Bidders on a proportionate basis.

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

Bid Price in any of their Bid cum Application Forms or any previous

Revision Form(s)

SCSB Agreement The deemed agreement between the SCSBs, the BRLM, the Registrar to the

Issue and our Company, in relation to the collection of Bids from the ASBA

Bidders and payment of funds by the SCSBs to the Public Issue Account.

Self Certified Syndicate Bank

or SCSBs

Self Certified Syndicate Bank is a Banker to an Issue registered with SEBI

which offers the facility of making a Applications Supported by Blocked

Amount and recognised as such by SEBI, a list of which is available at

http://www.sebi.gov.in/pmd/scsb/html

Stock Exchanges The Bombay Stock Exchange Limited and the National Stock Exchange of

India Limited

Sub Syndicate Member A SEBI registered member of BSE and / or NSE appointed by the BRLM

and / or Syndicate Member to act as a Sub Syndicate Member in the Issue

Syndicate Jointly, the BRLM, the Syndicate Members and the Sub Syndicate Members

Syndicate Agreement The agreement to be entered into between the BRLM along with the

Syndicate Members and our Company in relation to the collection of Bids

(excluding Bids by ASBA Bidders) in this Issue

Syndicate Member(s) An intermediary registered with the SEBI to act as a syndicate member and

who is permitted to carry on the activity as an underwriter, in this case being

Term Description

Transaction Registration Slip /

The slip or document issued by member of the Syndicate or the SCSBs (only

on demand), as the case may be, to the Bidder as proof of registration of the

Underwriters The Book Running Lead Manager and the Syndicate Members

Underwriting Agreement The agreement among the Underwriters and our Company to be entered into,

on or after the Pricing Date

Working Day Unless the context otherwise requires:

(i) Till the Bid / Issue closing date: All days other than a Saturday, Sunday

or a public holiday;

(ii) Post the Bid / Issue closing date: All days other than a Sunday or a

public holiday

And on which commercial banks in Mumbai are open for business in

accordance with the SEBI circular no. CIR/CFD/DIL/3/2010 dated April 22,

Technical / Industry Related Terms / Abbreviations

Term Description

APAC Asia Pacific

ASIC Application Specific Integrated Circuits

ATE Automated Test Equipment

ATM Automated Teller Machine

BFSI Banking, Financial Services and Insurance

BI Business Intelligence

BPO Business Process Outsourcing

CAGR Compounded Annual Growth Rate

CEMA Central & Eastern Europe, Middle East and Africa

CMS Case Management System

CRM Customer Relationship Management

EDS Engineering Design Solutions/Services

EoU Export oriented Unit

ERP Enterprise Resource Planning

EU European Union

FDI Foreign Direct Investment

FIFO First in First Out

GDP Gross domestic profit

GOI Government of India

HIPAA Health Insurance Portability and Accountability Act

IEM Industrial Entrepreneurs Memorandum

ISV Independent Software Vendor

IT Information Technology

ITES Information Technology Enabled Service

IVR Interactive Voice Response

MIS Management Information System

NASSCOM The National Association of Software and Services Companies

NEGP National E-Governance Plan

NIC National Informatics Centre

NMS Network Management System

OS Operating System

QA Quality Assurance

QC Quality Control

R&D Research & Development

RFID Radio Frequency Identification

RMS Resource Management System

SMB Small and Medium Businesses

SSI Small Scale Industries

STPI Software Technology Parks of India

TMS Transportation Management System

UNDP United Nations Development Programme

Term Description

UNIDO United Nations Industrial Development Organisation

WebPM Web Based Project Management

Conventional/General Terms / Abbreviations

Abbreviation/Acronym Description

A/c Account

AGM Annual General Meeting.

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

AY Assessment Year; the period of twelve months commencing from the 1

st day of

April every year

BSE Bombay Stock Exchange Limited

CDSL Central Depository Services (India) Limited.

CENVAT Central Value Added Tax

CIN Corporate Identity Number

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

CRR Cash Reserve Ratio

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

DIN Director‟s identification number

DIPP Department of Industrial Policy and Promotion, Ministry of Commerce and

Industry, Government of India.

DP A Depository Participant as defined under the Depositories Act

EBIDTA Earnings before Interest, Depreciation, Tax, Amortisation and extraordinary

ECB External Commercial Borrowings

ECS Electronic Clearing System

EGM Extraordinary General Meeting

EPS Earnings per Share

ESIC Employee State Insurance Corporation

FCNR Account Foreign Currency Non Resident Account

FDI Foreign Direct Investment

FEMA The Foreign Exchange Management Act, 1999, together with rules and

regulations framed thereunder, as amended

FEMA Regulations Foreign Exchange Management (Transfer or Issue of Security by a Person

Resident Outside India) Regulations, 2000, as amended

FII Foreign Institutional Investor, as defined under the FII Regulations and

registered with the SEBI under applicable laws in India

FII Regulations Securities and Exchange Board of India (Foreign Institutional Investors)

Regulations, 1995, as amended

Financial Year / Fiscal / Fiscal

Year / FY

Period of twelve months ended March 31 of that particular year, unless

specifically stated otherwise

FIPB Foreign Investment Promotion Board

FVCI Foreign venture capital investor as defined in and registered under the FVCI

Regulations.

FVCI Regulations Securities and Exchange Board of India (Foreign Venture Capital Investors)

Regulations, 2000, as amended.

GER Gross Enrolment Ratio

GIR Number General Index Registry Number

GoI/ Government Government of India

HUF Hindu Undivided Family

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

I. T. Rules The Income Tax Rules, 1962, as amended from time to time

IFRS International Financial Reporting Standards.

Indian GAAP Generally Accepted Accounting Principles in India.

IPO Initial Public Offer

IRDA Insurance Regulatory and Development Authority

IT Information technology

Key Managerial Personnel /

The officers vested with executive powers and the officers at the level

immediately below the Board of Directors of the Issuer Company and other

persons whom the Issuer has declared as a Key Managerial Personnel and as

mentioned in the chapter titled „Our Management‟ beginning on page 79 of the

Draft Red Herring Prospectus

Ltd. Limited

Merchant Banker Merchant banker as defined under the Securities and Exchange Board of India

(Merchant Bankers) Regulations, 1992 as amended from time to time

MICR Magnetic Ink Character Recognition

MNC Multi National Company

MOU Memorandum of Understanding

N.A. Not Applicable

Net Asset Value being paid-up equity share capital plus free reserves

(excluding reserves created out of revaluation, preference share capital and

share application money) less deferred expenditure not written off (including

miscellaneous expenses not written off) and debit balance of „profit and loss

account‟, divided by number of issued Equity Shares outstanding at the end of

the Fiscal.

NBFC Non-Banking Finance Company

NECS National Electronic Clearing System

NEFT National Electronic Fund Transfer

NIFTY National Stock Exchange Sensitive Index

NSDL National Securities Depository Limited

NSE National Stock Exchange of India Limited

NTA Net Tangible Assets

p.a. Per annum

P/E Ratio Price/Earnings Ratio

PAN Permanent Account Number

PAT Profit After Tax

PBT Profit Before Tax

R & D Research and Development

RBI Reserve Bank of India

RBI Act The Reserve Bank of India Act, 1934, as amended from time to time.

RoNW Return on Net Worth

Rs./`/INR/Rupees Indian Rupees, the legal currency of the Republic of India

RTGS Real Time Gross Settlement

SCRA Securities Contracts (Regulation) Act, 1956, as amended from time to time

SCRR Securities Contracts (Regulation) Rules, 1957, as amended from time to time

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

SEBI Act Securities and Exchange Board of India Act, 1992, read with rules and

regulations thereunder and amendments thereto and as amended from time to

SEBI ICDR Regulations / ICDR

Regulations / SEBI ICDR /

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

amended from time to time, including instructions and clarifications issued by

SEBI from time to time.

SEBI Insider Trading

Regulations

SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended from

time to time, including instructions and clarifications issued by SEBI from time

to time.

SEBI Rules and Regulations SEBI ICDR Regulations, SEBI (Underwriters) Regulations, 1993, as amended,

the SEBI (Merchant Bankers) Regulations, 1992, as amended, and any and all

other relevant rules, regulations, guidelines, which SEBI may issue from time

to time, including instructions and clarifications issued by it from time to time.

SEBI Takeover Regulations/

Takeover Code

SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, as

amended from time to time.

Sec. Section

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

SICA Sick Industrial Companies (Special Provisions) Act, 1985, as amended from

time to time

Sq.ft. Square feet

sq.mtrs. Square meters

Sub-account Sub-accounts registered with SEBI under the Securities and Exchange Board of

India (Foreign Institutional Investor) Regulations, 1995, as amended.

TDS Tax Deducted at Source

U.S. or US or U. S. A. The United States of America

UIN Unique Identification Number issued in terms of SEBI (Central Database of

Market Participants) Regulations, 2003, as amended from time to time.

ULIP Unit Linked Insurance Plan

UoI Union of India

VCF Regulations Securities and Exchange Board of India (Venture Capital Funds) Regulations,

1996, as amended from time to time

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

Regulations

Notwithstanding the foregoing:

1. In the section titled „Main Provisions of the Articles of Association‟ beginning on page 185 of the Draft Red

Herring Prospectus , defined terms shall have the meaning given to such terms in that section;

2. In the chapters titled „Summary of Business‟ and „Our Business‟ beginning on pages 3 and 57 respectively,

of the Draft Red Herring Prospectus, defined terms shall have the meaning given to such terms in that

section;

3. In the section titled „Risk Factors‟ beginning on page xv of the Draft Red Herring Prospectus, defined terms

shall have the meaning given to such terms in that section;

4. In the chapter titled „Statement of Tax Benefits‟ beginning on page 42 of the Draft Red Herring Prospectus,

defined terms shall have the meaning given to such terms in that section;

5. In the chapter titled „Management‟s Discussion and Analysis of Financial Conditions and Results of

Operation‟ beginning on page 119 of the Draft Red Herring Prospectus, defined terms shall have the

meaning given to such terms in that section.

PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA

Certain Conventions

Unless otherwise specified or the context otherwise requires, all references to „India‟ in the Draft Red Herring

Prospectus are to the Republic of India, together with its territories and possessions, all references to the „US‟,

the „USA‟, the „United States‟ or the „U.S.‟ are to the United States of America, together with its territories and

possessions.

Financial Data

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

financial statements for the Fiscals 2007, 2008, 2009, 2010 and 2011 prepared in accordance with Indian

GAAP, the Companies Act and restated in accordance with the SEBI ICDR Regulations and the Indian GAAP

which are included in the Draft Red Herring Prospectus, and set out in the section titled „Financial Information‟

beginning on page 99 of the Draft Red Herring Prospectus. Our Fiscal commences on April 1 and ends on

March 31 of the following year, so all references to a particular Fiscal are to the twelve-month period ended

March 31 of that year. In the Draft Red Herring Prospectus, discrepancies in any table, graphs or charts between

the total and the sums of the amounts listed are due to rounding-off.

There are significant differences between Indian GAAP, IFRS and U.S. GAAP. Our Company has not attempted

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

should consult their own advisors regarding such differences and their impact on the financial data.

Accordingly, the degree to which the restated financial statements included in the 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 the Draft Red Herring Prospectus should accordingly be limited.

Any percentage amounts, as set forth in the sections / chapters titled „Risk Factors‟, „Our Business‟ and

„Management's Discussion and Analysis of Financial Condition and Results of Operations‟ beginning on pages

xv, 57 and 119 respectively, of the Draft Red Herring Prospectus and elsewhere in the Draft Red Herring

Prospectus, unless otherwise indicated, have been calculated on the basis of our restated financial statements

prepared in accordance with Indian GAAP, the Companies Act and restated in accordance with the SEBI ICDR

Regulations and the Indian GAAP.

Currency and units of presentation

In the Draft Red Herring Prospectus, unless the context otherwise requires, all references to;

• „Rupees‟ or „`‟ or „Rs.‟ Or „INR‟ are to Indian rupees, the official currency of the Republic of India.

• „US Dollars‟ or „US$‟ or „USD‟ or „$‟ are to United States Dollars, the official currency of the United

States of America.

All references to the word „Lakh‟ or „Lac‟, means „One hundred thousand‟ and the word „Million‟ means „Ten

Lacs‟ and the word „Crore‟ means „Ten Million‟ and the word „Billion‟ means „One thousand Million‟.

Industry and Market Data

Unless stated otherwise, industry data used throughout the Draft Red Herring Prospectus has been obtained from

industry publications and publicly available government documents. 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. Similarly, while

information contained in the publicly available government documents that is relied upon for the purposes of the

Draft Red Herring Prospectus is believed to be complete and reliable, there can be no assurance of the same.

Accordingly, no investment decisions should be made based on such information. The extent to which the

industry and market data used in the Draft Red Herring Prospectus is meaningful depends on the reader‟s

familiarity with and understanding of, the methodologies used in compiling such data. Further, the extent to

which the industry and market data presented in the Draft Red Herring Prospectus is meaningful depends on the

reader's familiarity with and understanding of, the methodologies used in compiling such data.

FORWARD LOOKING STATEMENTS

All statements contained in the Draft Red Herring Prospectus that are not statements of historical facts constitute

„forward-looking statements‟. All statements regarding our expected financial condition and results of

operations, business, plans and prospects are forward-looking statements. These forward-looking statements

include statements as to our business strategy, our revenue and profitability, planned projects and other matters

discussed in the Draft Red Herring Prospectus regarding matters that are not historical facts. These forward

looking statements and any other projections contained in the Draft Red Herring Prospectus (whether made by

us or any third party) are predictions and involve known and unknown risks, uncertainties and other factors that

may cause our actual results, performance or achievements to be materially different from any future results,

performance or achievements expressed or implied by such forward-looking statements or other projections.

These forward-looking statements generally can be identified by words or phrases such as „aim‟, „anticipate‟,

„believe‟, „expect‟, „estimate‟, „intend‟, „objective‟, „plan‟, „predict‟, „project‟, „prospect‟, „may‟, „might‟, „risk‟,

„strategy‟, „uncertain‟, „will‟, „will continue‟, „will pursue‟ or other words or phrases of similar import.

Similarly, statements that describe our aims, strategies, objectives, plans or goals are also forward-looking

statements. All forward-looking statements are subject to risks, uncertainties and assumptions about us that

could cause actual results and property valuations to differ materially from those contemplated by the relevant

statement.

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

uncertainties associated with our 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, among

others:

1. Implementation risks involved in our projects;

2. Significant changes in the exchange rates;

3. Increase in freight, interest rates, etc.;

4. Competition from existing players;

5. Working capital arrangements;

6. Growth of unorganised sector and threat from national/regional players;

7. Changes in laws and regulations relating to the industry in which we operate;

8. Disruption in supply of raw materials;

9. Changes in political and social conditions in India, the monetary and interest rate policies in India and / or

other countries, inflation, deflation, anticipated turbulence in interest rates, equity prices or other rates or

prices;

10. Imposition of any anti- dumping duties in the Industry in which we operate;

11. Our ability to successfully implement our strategy, growth and expansion plans;

12. The outcome of legal or regulatory proceedings that we are or might become involved in;

13. Contingent liabilities and uninsured losses;

14. Changes in government policies and regulatory actions that apply to or affect our business;

15. Developments affecting the Indian economy;

16. Ability to retain appropriate personnel;

17. Uncertainty in global financial markets; and

18. Occurrence of natural disasters or calamities affecting the areas in which our Company has its operations.

For further discussion of factors that could cause our actual results to differ from our expectations, please refer

sections / chapter titled „Risk Factors‟, „Our Business‟ and „Management‟s Discussion and Analysis of

Financial Condition and Results of Operations‟ beginning on pages xv, 57 and 119 respectively, of the Draft

Red Herring Prospectus. 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 future gains or losses could

materially differ from those that have been estimated.

Forward looking statements reflects views as of the date of the Draft Red Herring Prospectus and not a

guarantee of future performance. Neither our Company, our Directors and officers and the BRLM nor any of the

Syndicate Members nor any of their respective affiliates has any obligation to, and do not intend 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, our Company and the BRLM will ensure that investors in India are informed of material

developments until the time of the grant of listing and trading approvals by the Stock Exchanges.

SECTION II - RISK FACTORS

An investment in the Equity Shares involves a high degree of risk. You should carefully consider all the

information in the Draft Red Herring Prospectus, including the risks and uncertainties summarised below,

before making an investment in our Equity Shares. The risks described below are relevant to the industries our

Company is engaged in, our Company and our Equity Shares. To obtain a complete understanding of our

Company, you should read this section in conjunction with the chapters titled „Our Business‟ and

„Management‟s Discussion and Analysis of Financial Condition and Results of Operations‟ beginning on pages

57 and 119 respectively, of the Draft Red Herring Prospectus as well as the other financial and statistical

information contained in the Draft Red Herring Prospectus. Prior to making an investment decision,

prospective investors should carefully consider all of the information contained in the section titled „Financial

Information‟ beginning on page 99 of the Draft Red Herring Prospectus. Unless stated otherwise, the financial

data in this section is as per our financial statements prepared in accordance with Indian GAAP.

If any one or more of the following risks as well as other risks and uncertainties discussed in the Draft Red

Herring Prospectus were to occur, our business, financial condition and results of our operation could suffer

material adverse effects, and could cause the trading price of our Equity Shares and the value of investment in

the Equity Shares to materially decline which could result in the loss of all or part of investment. Prospective

investors should pay particular attention to the fact that our Company is incorporated under the laws of India,

and is therefore subject to a legal and regulatory environment that may differ in certain respects from that of

other countries.

The Draft Red Herring Prospectus also contains forward looking statements that involve risks and

uncertainties. Our actual results could differ materially from those anticipated in these forward-looking

statements as a result of many factors, including the considerations described below and elsewhere in the Draft

Red Herring Prospectus.

These risks are not the only ones that our Company face. Our business operations could also be affected by

additional factors that are not presently known to us or that we currently consider to be immaterial to our

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

financial or other implication of any risks mentioned herein.

Materiality

The Risk factors have been determined on the basis of their materiality. The following factors have been

considered for determining the materiality.

1. Some events may not be material individually but may be material when considered collectively.

2. Some events may have an impact which is qualitative though not quantitative.

3. Some events may not be material at present but may have a material impact in the future.

Internal risks

1. Our Company is involved in certain legal proceedings. Any adverse decision in such proceedings may

render us liable to liabilities / penalties and may adversely affect our business and results of operations.

Our Company is involved in certain legal proceedings and claims in relation to certain tax matters. These legal

proceedings are pending at different levels of adjudication. Any adverse decision may render us liable to

liabilities / penalties and may adversely affect our business and results of operations. A classification of these

legal and other proceedings are given in the following table:

Entity involved in the cases Tax cases Financial implications

(` in lacs)*

Cases against our Company 5 99.15 Cases by our Company NIL - *The table above does not include those penalties, interests and costs, if any, which may be imposed or which

may have been pleaded but not quantified in the course of legal proceedings, or which the tribunal otherwise

has the discretion to impose. The imposition and amount of such penalties / interests / costs are at the discretion

of the tribunal where the case is pending. Such liability, if any, would crystallize only on the order of the

tribunal where the case(s) is / are pending.

For further details regarding these legal proceedings, please refer to the chapter titled „Outstanding Litigations

and Material Developments‟ beginning on page 128 of the Draft Red Herring Prospectus.

2. Our Company had negative cash flow in recent fiscals, details of which are given below. Sustained

negative cash flow could adversely impact our business, financial condition and results of operations.

(` in lacs)

Cash flow from As at March 31

2011 2010 2009

Investing activities (258.20) (147.08) (3.82) Financing activities 329.76 (17.43) (102.29)

Cash flow of a company is a key indicator to show the extent of cash generated from operations to meet its

capital expenditure, pay dividends, repay loans and make new investments without raising finance from external

resources. If we are not able to generate sufficient cash flow, it may adversely affect our business and financial

operations. For further details please refer to the section titled „Financial Information‟ and chapter titled

„Management‟s Discussion and Analysis of Financial Condition and Results of Operations as reflected in the

Financial Statements‟ beginning on pages 99 and 119 respectively, of the Draft Red Herring Prospectus.

3. Our Promoters and Directors have direct interest in Norr Advisors Private Limited, our Group Company

whose main objects are similar to that of our Company , which may create a conflict of interest. Further

we do not enjoy contractual protection by way of a non–compete or other agreement or arrangement

with Norr Advisors Private Limited.

Our Promoters and Directors Nitin Shenoy and Surabhi Shenoy are also promoters and directors and have equity

interest / investments in our Group Company, Norr Advisors Private Limited whose main objects allows it to

engage in the business, inter alia, to carry on the business of rendering consultancy services for clients and to

act as counsel and provide consultancy, advisory and all related services in all areas of information technologies

which is similar to that of our Company‟s business. As Norr Advisors Private Limited does not have any non–

compete agreement in place with our Company, there may arise a conflict of interest in addressing business

opportunities and strategies and implementing new plans. However, as on the date of the Draft Red Herring

Prospectus Norr Advisors Private Limited is not carrying any business that is competing with that of our

Company. For further details please refer to the chapters titled „Our Promoters and Promoter Group‟ and „Our

Group Entities‟ beginning on page 91 and 95 respectively of the Draft Red Herring Prospectus.

4. Substantial portion of our revenues has been dependent upon our few clients. The loss of any one or

more of our major clients would have a material adverse effect on our business operations and

profitability.

For the financial year ended March 31, 2011, our five largest clients accounted for approximately 97.39% of our

net sales. The loss of a significant client or clients would have a material adverse effect on our financial results.

We cannot assure you that we can maintain the historical levels of business from these clients or that we will be

able to replace these clients in case we lose any of them. Further the business with clients is based on regular

requirements and orders, rather than yearly contracts.

Financial Year % of Net Sales Contribution from Top 5 clients

FY 2010-2011 97.39

FY 2009-2010 99.81

FY 2008-2009 100.00

5. Our revenues, expenses and profits may vary significantly from period to period. This could cause the

market value of our Equity Shares to decline.

Our operating results may vary significantly from period to period. Our revenue, expenses, and profit after tax

have varied as follows in the Fiscal 2011, 2010 and 2009:

(` in lacs except stated otherwise)

Particulars For the Fiscal

2011 2010 2009

Operating Income 3,502.42 2,194.72 482.25

Expenses 3,026.93 2,109.37 438.72

Profit after tax 248.31 70.52 (5.49)

Particulars For the Fiscal

2011 2010 2009

Expenses as a percentage of

Operating Income(%)

86.42 96.11 90.97

Profit After Tax as a percentage

of Operating Income (%)

7.09 3.21 (1.14)

As a large part of any period‟s revenues is derived from existing customers, revenue growth can vary due to

project start and stops and customer-specific situations. In addition, revenue from new customers also varies

from period to period. Factors that affect the fluctuation of our revenues, expenses and profits include (a)

variations, expected or unexpected, in the duration, size, timing and scope of our projects, particularly with our

major customers; (b) our pricing policies or those of our customers or competitors; (c) unanticipated attrition

and the time required to hire, train and productively utilise our new employees; (d) loss of clients; (e) our ability

to acquire new clients; (f) annual increases in compensation of our employees; (g) the size and timing of

expansion of our facilities; (h) unanticipated cancellations, non-renewal of our contracts by our clients, contract

terminations or deferrals of projects; (i) changes in our employee utilisation ratios due to various factors etc.

A significant part of our expenses, particularly those related to personnel and facilities are fixed in advance of

any particular period. As a result, unanticipated variations in the number and timing of our projects or employee

utilisation rates may cause significant variations in our operating results in any particular period. There are also

a number of factors other than our performance that are not within our control that could cause fluctuations in

our operating results. These include (a) the duration of tax holidays or exemptions and the availability of other

incentives; (b) the outcome of any tax, legal or regulatory review, action or litigation; (c) currency exchange rate

movements, particularly when the rupee appreciates in value against the US$ since the majority of our revenues

are in US$ and a significant part of our expenses are in Indian Rupees; (d) other general economic factors.

6. Any inability to manage our growth could disrupt our business and reduce our profitability.

We have experienced significant growth in recent years. Our revenues, as restated, grew at an annual growth

rate of 59.58%, 355.10% and (41.04)% during Fiscal 2011, 2010 and 2009, respectively in Indian Rupee terms.

We expect our future growth to place significant demands on both our management and our resources. This will

require us to continuously evolve and improve our operational, financial and internal controls across the

organisation. In particular, continued expansion increases the challenges we face in:

recruiting, training and retaining sufficient skilled technical and management personnel;

adhering to our high quality and process execution standards;

maintaining high levels of customer satisfaction;

managing a larger number of customers in a greater number of industry sectors;

integrating expanded operations while preserving our culture, values and entrepreneurial environment;

developing and improving our internal administrative infrastructure, particularly our financial,

operational, communications, and other internal systems.

If we are unable to manage our growth it could have an adverse effect on our business, results of operations and

financial condition.

7. We are at risk of termination of our contracts as our Company does not have long-term agreements with

any of our clients and is subject to uncertainties in demand for our IT products and services. There is no

assurance that these clients will continue to render our IT products and services or that they will not

scale down their requirements. Any such termination may detrimentally affect our business and

operations.

Though our Company has been dealing with some of our customers for several years, our clients typically retain

us through non-exclusive service contracts. We do not have any long term agreements with majority of our

clients and such agreements are typically terminable by the clients without cause on a short notice period. As a

result, our clients can terminate their relationships with us due to circumstances beyond our control, such as

change in strategic software requirements of the client, financial constraints of the client, a more competitive

option offered by a competitor, a change in policy regarding outsourcing of software by the client or a perceived

failure to provide services and products as required by the client or any other reason upon relatively short notice,

which could materially and adversely impact our business. Additionally, our service agreements with customers

are typically without any commitment to a specific volume of business or future work. The contracts entered

into between us and our clients relate to particular assignments in relation to which a set of quality control

norms and mechanisms as well as a time-frame for delivery is typically stipulated. If we are not able to provide

our software products or services within these particular parameters, our clients may be able to terminate these

contracts. Although, we have a strong emphasis on quality, timely delivery of our IT products and services and

personal interaction by the top management with the clients, any change in the preferences of our clients can

adversely affect the business of our Company.

8. Failure to obtain pre-qualifications and/or certifications could adversely impact our business.

Certain clients generally require software suppliers to undergo pre-qualification processes. These processes

evaluate both the technical ability to provide relevant products with the exact specifications needed by the end-

user, and the production capabilities of the supplier. These processes generally take time to complete and

involve the incurrence of considerable up-front expenses in learning and meeting customer qualification

requirements.

9. Our revenues are dependent upon our meeting specific customer requirements largely on a case-to-case

basis. Any failure or limitation on our ability to provide customized software services may detrimentally

affect our future growth.

Our assignments for providing services largely involve us providing business and software solutions on a case-

to-case basis, depending upon the needs of each client. Our inability to provide customized software solutions

could lead to erosion of our market image and brand value, which could lead to clients discontinuing their work

with us and stagnation of our client base, which in turn could harm our business and profitability. Our future

growth will depend on our continued evolution of specific sets of customized services to deal with the rapidly

evolving and diverse needs of our clients in a cost competitive and effective manner.

10. Our fixed-price contracts may expose us to risks beyond our control, which could reduce our

profitability.

We provide services either on a fixed price basis, where we provide our services for a fixed price and agree to

complete the project within a fixed time, or on a time spent and materials basis, where we charge based on the

number of people dedicated and the effort invested in the project. Although we use our past project experience

and contractual provisions to reduce the risks associated with estimating, planning and performing fixed-price

projects, we bear the risk of cost overruns and completion delays in connection with these projects. Many of

these risks are beyond our control. Any failure to accurately estimate the effort including the number of people

and time required for a project or any failure to complete our contractual obligations within the time frame

committed could adversely affect our revenues and profitability.

11. We are subject to risks arising from exchange rate movements. Our financial results could detrimentally

be affected by such unfavourable movements in exchange rates.

Although our functional currency is the Indian Rupee, we transact a significant portion of our business in

several other currencies, particularly the US$. Our exchange rate risk primarily arises from our foreign currency

revenues, receivables, payables etc. We expect that a significant portion of our revenues will continue to be

generated in US$ for the foreseeable future. During Fiscal 2011 and 2010, our US$ denominated revenues were

US$ 34.17 lacs and US$ 11.35 lacs respectively, which represented 44.01 % and 24.18 % of our total revenues,

respectively. A significant portion of our expenses, comprising personnel expenses and operating and other

expenses are and will continue to be denominated and incurred in Indian Rupees. During Fiscal 2011 and 2010,

our Indian Rupee expenses represented 76.05% and 96.00% of our total operating expenses. Therefore, changes

in the exchange rate between the Indian Rupee and other currencies, especially with respect to the US$, may

have a material adverse effect on our revenues, other income, cost of services, operating costs and net income,

which may in turn have a negative impact on our business, operating results and financial condition. The

exchange rate between the Indian Rupee and the US$ has been volatile in recent years and may fluctuate

substantially in the future.

Further, we have not entered into any foreign exchange forward contracts or currency options to reduce the

effect of exchange rate movements on our outstanding accounts receivables and projected earnings in foreign

currency. Also, in future even if we enter into any such foreign exchange forward contracts or currency options,

such contracts may not perform effectively as a hedging mechanism. For further details please refer to the

paragraph titled „Foreign Exchange Risk‟ under the chapter titled „Management‟s Discussion and Analysis of

Financial Condition and Results of Operations‟ beginning on page 119 of the Draft Red Herring Prospectus.

12. Our success depends largely on our senior management and key personnel and our ability to attract and

retain them.

We are highly dependent on the senior management of our Company. Our future performance will be affected

by the lack of continued service of these persons. We do not maintain key man life insurance for any of the

senior members of our management team or other key personnel. Competition for senior management in our

industry is intense, and we may not be able to retain such senior management personnel or attract and retain new

senior management personnel in the future. The loss of any of the members of our senior management or other

key personnel may adversely affect our business, results of operations and financial condition. For further

details on all of our key managerial personnel please refer to paragraph titled “Our Key Managerial Personnel”

in the chapter titled “Our Management” beginning on page 132 of this Draft Red Herring Prospectus.

13. We face significant competition for highly skilled professionals who are not readily replaceable. Our

success depends in large part upon our ability to attract and retain these professionals. Any inability on

our part to attract and retain these professionals may adversely affect our business and results of

operations.

Our ability to execute projects and to obtain new clients depends largely on our ability to attract, train, motivate

and retain highly skilled software professionals. We have trained personnel in this line of business and lay

emphasis on training and skill upgradation through training programmes for our employees. We invest

significant time and money in training the professionals that we hire to perform the services we provide. Our

ability to sustain our growth depends, in large part, on our ability to attract, train, motivate and retain highly

skilled key personnel, particularly in the creative area of product and software development. These professionals

are often targeted by the lateral recruitment efforts of our competitors, and in some cases by our clients. We

believe that there is also a significant competition in our industry among employers to attract software

professionals with the skills necessary to perform the services we offer. Our inability to hire and retain

additional qualified personnel will impair our ability to continue to expand our business. The attrition rates in

the industry in which we operate have been high due to a highly competitive skilled labour market. An increase

in the rate of attrition for our experienced employees, would adversely affect our growth strategy.

In addition, we may have difficulty redeploying and retraining our software professionals to keep pace with

continuing changes in technology, evolving standards and changing client preferences. If we cannot hire and

retain additional qualified personnel, our ability to bid on and obtain new projects / mandates may be impaired

and our revenues could decline. In addition, we may not be able to expand our business effectively thereby

affecting our revenues and profitability.

14. Increases in wages for IT professionals could reduce our cash flow and profit margins.

Historically, wage costs in the Indian IT services industry have been significantly lower than wage costs in the

developed countries for comparable skilled technical personnel. However, in recent years wage costs in the

Indian IT services industry have been increasing at a faster rate than those in certain developed countries. In the

long term, wage increases may make us less competitive unless we are able to continue increasing the efficiency

and productivity of our professionals and the prices we can charge for our products and services. Increase in

wages, including an increase in the cash component of our compensation expenses, may reduce our cash flow

and our profit margins.

15. Our Registered office is not owned by us and we have only license agreement in respect of this property.

In the event we are unable to renew the license agreement, or if such agreement is terminated, we may

suffer a disruption in our operations.

Our Registered office situated at Unit No. 2, A Wing, 8th

Mumbai – 400 064, Maharashtra, India is taken on lease basis from Hamlet Constructions (India) Private

Limited, (“the Licensor”) vide a license agreement for a period of 36 months commencing from January 24,

2011upto January 23, 2014.

Upon the termination of the license, we are required to return the said office premises to the Licensor. The term

of the agreements may or may not be renewed. In the event the Licensor terminates or does not renew the

license on commercially acceptable terms, or at all, and we are required to vacate our registered office, we may

be required to identify alternative premises and enter into fresh lease or leave and licence agreement. Such a

situation could result in loss of business and may adversely affect our operations and profitability.

16. Some of our agreements may be inadequately stamped and some of our immovable properties may have

certain irregularities in title.

As on the date of the Draft Red Herring Prospectus, our Company utilize one premise as our registered office

situated at Unit No. 2, A Wing, 8th Floor, Prism Tower, Mindspace, Goregaon (West), Mumbai – 400 064,

Maharashtra, on leave and license basis and our Company is a joint owner of a piece of land. The same are

detailed in the paragraph titled “Our Properties” in the chapter titled “Our Business” beginning on page 57 of

the Draft Red Herring Prospectus. Though our Company has previously not been subject to litigation with

respect to irregularities in the title of properties owned / leased by our Company; we may not be able to assess or

identify certain risks and liabilities associated with the irregularities of title such as inadequate stamping and/or

non registration of deeds and agreements, non execution of lease deeds and non renewal of lease agreements.

The un-registered documents / inadequately stamped documents cannot be received as evidence in legal

proceedings under the Registration Act, 1908 and we may not be able to adequately protect our interest, unless

the same are registered. In such a situation, our Company may lose such premises if any eviction proceedings

succeed against our Company. Such eviction may adversely affect the business, operations and profits of our

Company.

17. Our registered office is located in Mumbai, India. Our results of operations could be materially and

adversely affected if such facilities are disrupted.

All our employees as on the date of the Draft Red Herring Prospectus are based in our registered office located

in Mumbai, India. Because of the concentration of all our personnel and other resources at this facility, our

results of operations could be materially and adversely affected if this facility is damaged as a result of a natural

disaster, including an earthquake, flood, fire, or other event that disrupts our business or causes material damage

to our property. Although we have back-up facilities for some of our operations, it could be difficult for us to

maintain or resume our operations quickly in the aftermath of such a disaster. We cannot assure you that our

property insurance would cover any loss or damage to our assets.

18. Our Company may be unable to consummate strategic acquisition(s) and/or make investments. Our

inability to manage such acquisition(s) timely could have an adverse effect on our business, financial

condition and profitability.

Out of the proceeds of the Issue, we propose to earmark ` 1,500 lacs for acquisitions and other strategic

initiatives wherein we have not identified targets / strategic plans as on the date of the Draft Red Herring

Prospectus. 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 our targeted clients. We cannot assure that we would

be able to consummate acquisitions or conclude such definitive agreements on terms acceptable to us, or if at

all. We cannot assure that our acquisitions, if any, would be at an optimum price, or that the same will not turn

out to be overpriced or overvalued, which may adversely affect our projected returns in relation to such

acquisition. Further, the inability to identify the right acquisition targets could lead to consequential difficulties

like integration of business of both partners, including its operations, personnel, technology and software.

In addition to the above, potential acquisitions could involve a number of specific risks, including diversion of

management‟s attention, higher costs, unanticipated events or circumstances, legal liabilities, failure of the

business of the acquired company, fall in value of investments and amortization of acquired intangible assets,

some or all of which could have a material adverse impact on our business, financial condition and results of

operations. In the event of an overseas acquisition, our Company may be required to obtain the prior approval of

the RBI, other regulators and/or the Government of India and there can be no assurance that such approvals will

be obtained in a timely manner or at all. For further details please refer the chapter titled “Objects of the Issue”

beginning on page 27 of the Draft Red Herring Prospectus.

19. The balance working capital requirements of our Company is not firmly tied up with any financial

institutions/banks and the delay or failure to tie-up can affect our operations and financial performance

adversely.

Additional working capital requirements of our Company has been estimated at ` 1,707.72 lacs, for the financial

year 2012 – 13, out of which, ` 1,000 lacs is to be funded from the Issue proceeds and the balance amount of `

707.72 lacs would be arranged by way of internal accruals or borrowings from the financial institutions / banks.

As on date of the Draft Red Herring Prospectus, our Company has not tied up with any financial institutions /

banks for the balance working capital requirement of our Company. In case we are not able to tie up for the

balance working capital requirement, our operations and financial performance will be adversely affected.

20. The objects of the Issue for which funds are being raised have not been appraised by any bank or

financial institution. The deployment of funds in the project is entirely at our discretion and as per the

details mentioned in the chapter titled “Objects of the Issue”. Any revision in the estimates may require

us to reschedule our proposed expenditure and may have a bearing on our expected revenues and

earnings.

Our funding requirements and the deployment of the proceeds of the Issue are based on management estimates

and have not been appraised by any bank or financial institution. We may have to revise our management

estimates from time to time and consequently our funding requirements may also change. Our estimates for the

proposed expenditure may exceed the value that would have been determined by third party appraisals and may

require us to reschedule our proposed expenditure which may have a bearing on our expected revenues and

earnings. Further, the deployment of the funds towards the objects of the Issue is entirely at the discretion of our

Board of Directors and is not subject to monitoring by external independent agency. However, the deployment

of funds is subject to monitoring by our audit committee.

21. The construction of our new Software Development Office is dependent on performance of external

agencies and non performance by them may lead to delay in project implementation and may adversely

affect our business and profitability.

The construction of our new Software Development Office is dependent on performance of external agencies,

which are responsible for construction of the building and other related facilities. We cannot assure that the

performance of external agencies will meet the required specifications or performance parameters. If the

performance of these agencies is inadequate in terms of the requirements with respect to timeline and quality of

performance, we may be required to replace these external agencies, which could result in incremental cost and

time overruns, and in turn could adversely affect our business operations and profitability.

22. We have not made definite arrangements for procurement/order placement of equipment worth ` 595.55

lacs (being 100% of the equipment cost) and [●]% of the total issue proceeds for our proposed new

Software Development Office. Any delay in placing the orders or delay at the suppliers‟ end may result in

time and cost overrun.

While, we have received estimates/quotations for the equipment, we would be placing orders for the equipment

at an appropriate time, as the same are available at reasonably short notice. The purchase of equipments would

require us to consider factors including but not limited to pricing, delivery schedule and after-sales maintenance.

There may also be a possibility of delay at the suppliers‟ end in providing timely delivery of these computer

equipments, which in turn may delay the implementation of our project. Further, we cannot assure you that the

purchase of the equipment would occur at the estimated price only.

23. Our business and profitability will suffer if we fail to anticipate and develop new products and services

and enhance existing products and services in order to keep pace with rapid changes in technology and

the industries on which we focus.

We operate in a technologically intensive environment, where we compete on a global scale. Information

Technology by its very nature is dynamic and ever changing and we may not be able to keep pace with the

rapidly changing environment. The IT products and services market is characterized by rapid technological

change, evolving industry standards, changing client preferences and new product and new service

introductions. Our future success will depend on our ability to anticipate these advances and develop new

product and service offerings to meet client needs. We may not be successful in anticipating or adequately

responding to these advances on timely basis, or, if we do respond, the services or technologies we develop may

not be successful in the marketplace. Any such failure on our part could adversely affect our ability to compete

efficiently, our cost-competitiveness, ability to develop new products and the consequential quality of our

products, and could also adversely affect our sales and profitability.

24. Increasing intense competition in the market for IT products and services could affect our margins, and

could also reduce our share of business from clients and may adversely impact our revenues and

profitability.

The IT products and services markets are highly competitive. Our competitors include large consulting firms,

large multinational technology firms, IT outsourcing firms, Indian IT services firms, software firms etc. The IT

industry is experiencing rapid changes that are affecting the competitive landscape, including recent divestitures

and acquisitions that have resulted in consolidation within the industry. These changes may result in larger

competitors with significant resources. Many of our competitors are larger than us and have significant

experience with international operations, and we may face competition from them in countries in which we

currently offer our products and services, as well as in countries in which we expect to begin offering our

products and services. While we have historically been able to provide our products and services in our principal

markets at competitive prices and on a cost-efficient basis, there can be no assurance that we will be able to do

so in the future, as our competitors may be able to offer products and services in those markets.

Additionally, we believe that our ability to compete also depends in part on factors outside our control, such as

the price at which our competitors offer comparable products and services, and the extent of our competitors‟

responsiveness to their clients‟ needs. Growing competition may force us to reduce the prices of our products

and services, which may reduce our revenues and margins and/or decrease our market share, any of which could

have a material adverse effect on our business, financial condition and results of operations.

25. Our Promoters and the members of our Promoter Group will continue to retain significant control in our

Company after the Issue, which will allow them to influence the outcome of matters submitted to

shareholders for approval. Such a concentration of ownership may also have the effect of delaying,

preventing or deterring a change in control.

After the completion of this Issue, our Promoter and Promoter Group will continue to hold 45.90% of the paid

up Equity Share capital of our Company. As a result, our Promoter will continue to exercise significant control

over us, including being able to control the composition of our Board of Directors and determine decisions

requiring simple or special majority voting, and our other shareholders will be unable to affect the outcome of

such voting. Our Promoters may take or block actions with respect to our business, which may conflict with our

interests or the interests of our minority shareholders, such as actions which delay, defer or cause a change of

our control or a change in our capital structure, merger, consolidation, takeover or other business combination

involving us, or which discourage or encourage a potential acquirer from making a tender offer or otherwise

attempting to obtain control of us. We cannot assure you that our Promoters and members of our Promoter

Group will act in our interest while exercising their rights in such entities, which may in turn materially and

adversely affect our business and results of operations. We cannot assure you that our Promoters will act to

resolve any conflicts of interest in our favour. If our Promoters sells a substantial number of the Equity Shares in

the public market, or if there is a perception that such sale or distribution could occur, the market price of the

Equity Shares could be adversely affected. No assurance can be given that such Equity Shares that are held by

the Promoter will not be sold any time after the Issue, which could cause the price of the Equity Shares to

decline.

26. Our Group Company, Elixir Fitness Private Limited promoted by our Promoters has incurred losses in

the last two years. Sustained financial losses by our Group Company, Elixir Fitness Private Limited may

not be perceived positively by external parties such as clients, suppliers etc, which may affect our

credibility and business operations.

Group Company, Elixir Fitness Private Limited promoted by our Promoters has incurred losses in the past two

years:

(` in Lacs)

Name of the Company

Profit after tax for the financial year ended

March 31,

2009 2010

Elixir Fitness Private Limited (15.88) (23.94)

Sustained financial losses by our Group Companies may not be perceived positively by external parties such as

clients, suppliers etc, which may affect our credibility and business operations.

27. We have issued below mentioned Equity Shares in the last twelve months from the date of filing the

Draft Red Herring Prospectus with SEBI, the price of which may be lower than the Issue Price.

Our Company has on the following dates, issued shares to the following persons/entities on a preferential basis:

Name of the Allottee Whether belongs

to Promoter Group

Number

of Equity

Shares

% of Pre-Issue

capital

Allotted on March 24, 2011

1) Dominic Romell No 1,27,000 10.00 1.41

2) Meera Shenoy Yes 60,000 10.00 0.67

Name of the Allottee Whether belongs

to Promoter Group

Number

of Equity

Shares

% of Pre-Issue

capital

3) Nitin Shenoy Yes 3,08,158 10.00 3.42

Allotted on March 30, 2011

1) Quantum Eservices Private Limited No 2,08,800 125.00 2.32

The price at which Equity Shares have been issued in the past 12 months is not indicative of the price at which

Equity Shares may be offered in the Issue or at the price at which they will trade upon listing.

28. Our Company has in the past entered into related party transactions with our Promoters and Promoter

Group Entities and may continue to do so in the future. There can be no assurance that such

transactions, individually or in the aggregate, will not have an adverse effect on our financial condition

and results of operations.

Our Company has entered into related party transactions with our Promoters and Promoter Group Entities in the

past. While our Company believes that all such transactions have been conducted on an arm‟s length basis and

are accounted as per Accounting Standard 18, however there can be no assurance that we could not have

achieved more favourable terms had such transactions not been entered into with related parties. Furthermore, it

is likely that we may enter into related party transactions in the future. There can be no assurance that such

transactions, individually or in the aggregate, will not have an adverse effect on our financial condition and

results of operations. For further details please refer to the section titled „Financial Information‟ beginning on

of the Draft Red Herring Prospectus.

29. Our Company has made application for registration of trademark, which is under process of registration.

We are unable to assure that the future viability or value of any of our intellectual property or that the

steps taken by us to protect the proprietary rights of our Company will be adequate.

We have not made any application for registration of trademark „ ‟, and the registration for the said

trademark in our name is important to retain our brand equity. Consenquently, we do not enjoy any statutory

protection under the Trade Marks Act, 1999 for such trademark. Further, we cannot assure that the same would

be granted registration or will not be challenged or if granted registration, will not be invalidated or

circumvented or will offer us any meaningful protection. Further, the laws of some countries in which we may

market our products and services may not protect our intellectual property rights adequately. We are unable to

assure that the future viability or value of any of our intellectual property or that the steps taken by us to protect

the proprietary rights of our Company will be adequate.

30. We could become liable to claims by our clients, suffer adverse publicity and incur substantial costs as a

result of defects in our products or services, which in turn could adversely affect our results of

operations.

Many of our contracts involve providing products and services that are critical to the operations of our clients'

business. Any failure or defect in our software or in our products, networks or computer systems could result in

a claim against us for substantial damages, regardless of our responsibility for such a failure or defect. Although

we attempt to limit our contractual liability for all damages, including consequential damages, in rendering our

services, we cannot be assured that the limitations on liability we provide for in our service contracts will be

enforceable in all cases, or that they will otherwise be sufficient to protect us from liability for damages. A

successful assertion of one or more large claims against us could adversely affect our financial condition and

results of operations.

31. If we are unable to successfully protect our computer systems from security risks, our business could

suffer particularly since our Company‟s operations involve transmission of data through Internet, which

involves security risks.

Few of our products and solutions operate on web technologies. Our client contracts require us to comply with

certain security obligations, including maintenance of network security, back-up of data, ensuring our network is

virus-free and ensuring the credentials of those employees who work with our clients. We cannot assure you that

we will be able to comply with all these obligations and not incur any liability. Further, while we have

implemented industry-standard security measures, our network may still be vulnerable to unauthorized access,

computer viruses and other disruptive problems. Anybody who is able to circumvent security measures could

misappropriate proprietary information and cause interruptions in our operations. We may be required to expend

significant capital or other resources to protect against the threat of security breaches or to alleviate problems

caused by such breaches. There can be no assurance that any measures implemented will not be circumvented in

the future.

32. Our insurance cover may be inadequate to fully protect us from all losses and may inturn adversely

affect our financial condition.

We maintain such insurance coverage as we believe is customary in the IT industry in India. Our insurance

policies, however, may not provide adequate coverage in certain circumstances and are subject to certain

deductibles, exclusions and limits on coverage. We maintain premises and vehicle insurance coverage.

However, we cannot assure you that the terms of our insurance policies will be adequate to cover any damage or

loss suffered by us or that such coverage will continue to be available on reasonable terms or will be available in

sufficient amounts to cover one or more large claims, or that the insurer will not disclaim coverage as to any

future claim. Further, there can be no assurance that any claim under the insurance policies maintained by us

will be honoured fully, in part or on time. To the extent that we suffer loss or damage that is not covered by

insurance or which exceeds our insurance coverage, our results of operations or cash flow may be affected.

33. Our clients‟ proprietary rights may be misappropriated by our employees in violation of applicable

confidentiality and non-disclosure agreements and as a result, cause us to breach our contractual

obligations in relation to such proprietary rights. Further, our employees may infringe intellectual

property rights of third parties, which may adversely affect our reputation and financial condition.

We require our employees to enter into non-disclosure and assignment of rights arrangements to limit access to

and distribution of our clients‟ proprietary and confidential information. We can give no assurance that the steps

taken by us will be adequate to enforce our clients intellectual property rights or to adequately prevent the

disclosure of confidential information by an employee. If our clients‟ proprietary rights are misappropriated by

our employees in violation of any applicable confidentiality agreements or otherwise, our clients may consider

us liable for that act and seek damages and compensation from us. In addition to these confidentiality

agreements, our client contracts may require us to comply with certain security obligations including

maintenance of network security, back-up of data, ensuring our network is virus free and ensuring the

credentials of our people that work with our clients. We cannot assure you that we will be able to comply with

all such obligations and that we will not incur liability nor have a claim for substantial damages against us. Any

such happening could adversely effect our business reputation, business operations and financial conditions.

34. Immigration restrictions could limit our ability to expand our operations in the United States and

Europe. We derive a high proportion of our revenues from clients located in the United States and Europe

which may be materially affected by such legislation. Offshore outsourcing has come under increased

scrutiny by various state governments in the United States and European countries.

We have Indian nationals, as our employees, working in the United States, Europe and other countries, as many

be necessary. Our employees posted outside India depend on our ability to obtain necessary visas and work

permits. Immigration laws in the United States and in other countries are subject to legislative change, as well as

to variations in standards of application and enforcement due to political forces and economic conditions. It is

difficult to predict the political and economic events that could affect immigration laws, or the restrictive impact

they could have on obtaining or monitoring work visas for our software professionals. Our reliance on work

visas for a number of our software professionals makes us particularly vulnerable to such changes and

variations. As a result, we may not be able to obtain a sufficient number of visas for our software professionals

or may encounter delays or additional costs in obtaining or maintaining such visas which in course may restrict

our ability to generate incremental revenues.

35. The valuations of companies in the software / information technology industry are presently high, which

may not be sustained in the future and may also not be reflective of future valuations in the industry.

There is no standard valuation methodology or accounting practices as the sector is domain centric and

technology driven.

The valuations in the Software / IT industry have been varying substantially in the recent past and hence current

valuation may not be reflective of future valuations in the industry. There is no standard valuation methodology

in the IT related industries. Our financials are not strictly comparable with the players in the industry. These

valuations in the software / information technology industry may not be sustained in future and current

valuations may not be reflective of future valuations for the industry.

36. Delays or defaults in client payments could result in a reduction of our profits.

We regularly commit resources to projects prior to receiving advances or other payments from our clients in

amounts sufficient to cover expenditures on projects as they are incurred. We may be subject to working capital

shortages due to delays or defaults in client payments. If clients default in their payments on a project to which

we have devoted significant resources or if a project in which we have invested significant resources is delayed,

cancelled or does not proceed to completion, it could have a material adverse effect on our business, financial

condition and results of operations and could cause the price of our Equity Shares to decline.

37. Our ability to pay dividends will depend upon future earnings, financial condition, cash flow, working

capital requirements, capital expenditures, lender‟s approvals and other factors.

Our Company has paid dividends in two of the past five financial years. The amount of our future dividend

payments, if any, will depend upon our future earnings, financial condition, cash flow, working capital

requirements, capital expenditures, lender‟s approvals and other factors. There can be no assurance that we shall

have distributable funds or that we will declare dividends in the future. Additionally, the terms of any financing

we obtain in the future, may contain restrictive covenants which may also affect some of the rights of our

shareholders, including the payment of the dividend.

38. We may be subject to liability in connection with our use of open source software, which could lead to

our loss of control over our software products or services and expose us and/or our clients to intellectual

property related legal disputes.

Upon receiving instructions from our customers, we help them integrate open source components into their own

platforms and products. Upon receiving instructions from our customers, we also test and certify customer

platforms that have been created with open source software. Under the various versions of the GNU General

Public License (the “GPL”) and certain compatible licenses (“GPL Compatibles”) that govern a large number of

open-source products, such open-source products or software code extracted therefrom can only be integrated

into other open-source products and proprietary software that either incorporates open source code or is linked

to or integrated with such open source code that may potentially be made subject to the GPL or GPL

Compatibles and may consequently be required to be distributed as open source software.

The use of software that is licensed under GPL and GPL Compatibles may potentially expose our clients and

our Company to the potential loss of control over revenue generating proprietary software when open source

code and proprietary software source code are mixed together in one primary software work. As a result, this

could expose our clients or us to intellectual property related legal disputes, on the grounds of violation of

license terms or as a patent or copyright infringement, which could lead to our loss of control over our software

products or services.

Risks Associated with the Equity Shares

39. 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, among

other things, volatility in the Indian and global securities markets, the results of our operations and performance,

the performance of our competitors, developments in the Indian software / information technology industry and

changing perceptions in the market about participation in these sectors, 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 public market for our Equity Shares 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 Issue Price. The share prices of companies participating in business assets can fluctuate

significantly, which subjects an investment in the Equity Shares to substantial volatility.

40. 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

The price of the Equity Shares will be subject to a daily circuit breaker imposed by 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 Indian stock exchanges. The percentage limit on our 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.

41. Conditions in the Indian securities market may affect the price or liquidity of our Equity Shares.

The Indian securities markets are smaller than securities markets in more developed economies and 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 the more developed economies. Indian stock

exchanges have in the past experienced substantial fluctuations in the prices of listed securities. Further, the

Indian stock exchanges have experienced volatility in the recent times. The Indian stock 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 and

limited price movements. A closure of, or trading stoppage on, the BSE or the NSE also could adversely affect

the trading price of the Equity Shares.

42. Fluctuations in operating results and other factors may result in decreases in our Equity Share price.

Stock markets have experienced extreme volatility that has often been unrelated to the operating performance of

particular companies. These broad market fluctuations may adversely affect the trading price of our Equity

Shares. There may be significant volatility in the market price of our Equity Shares. If we are unable to operate

profitably or as profitably as we have in the past, investors could sell our Equity Shares when it becomes

apparent that the expectations of the market may not be realized, resulting in a decrease in the market price of

our Equity Shares. In addition to our operating results, the operating results of other competitor companies,

changes in financial estimates or recommendations by analysts, governmental investigations and litigation,

speculation in the press or investment community, changes in general conditions in the economy or the financial

markets, or other developments affecting the industry in which we operate, could cause the market price of our

Equity Shares to be issued to fluctuate substantially.

43. Additional issuances of equity may dilute your holdings.

Any future issuance of our Equity Shares or securities linked to our Equity Shares may dilute your shareholding

in our Company. Any issuance of Equity Shares may dilute the holdings of our existing shareholders. After the

completion of the Issue, our Promoters and members of the Promoter Group will own, directly and indirectly,

approximately 45.90 % of our outstanding Equity Shares. Sales of a large number of our Equity Shares by our

Promoters and the members of the Promoter Group could adversely affect the market price of our Equity Shares.

Similarly, the perception that any such primary or secondary sale may occur could adversely affect the market

price of our Equity Shares.

44. Investors 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 realised 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 realised on the sale of equity shares held for more than 12 months to

an Indian resident, which are sold other than on a recognised stock exchange and on which no STT has been

paid, will be subject to long term capital gains tax in India. Further, any gain realised 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.

45. The Equity Shares issued pursuant to the Issue may not be listed on the BSE and the NSE in a timely

manner, or at all, and any trading closures at the BSE and the NSE may adversely affect the trading

price of our 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 all relevant documents authorising the issuing of Equity Shares to be

submitted and there could therefore be a failure or delay in listing the Equity Shares on the BSE and the NSE.

Any failure or delay in obtaining such approval would restrict your ability to dispose of your Equity Shares. The

BSE and the NSE have in the past experienced problems, including temporary exchange closures, broker

defaults, settlements 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 our Equity Shares. A

closure of, or trading stoppage on, either of the BSE and the NSE could adversely affect the trading price of the

Equity Shares.

External Risk

46. We cannot guarantee the accuracy or completeness of facts and other statistics with respect to India, the

Indian economy and the financial services and Information Technology sector contained in the Draft

While facts and other statistics in the Draft Red Herring Prospectus relating to India, the Indian economy and

the financial services and Information Technology sector has been based on various publications and reports

from agencies that we believe are reliable, we cannot guarantee the quality or reliability of such materials. While

we have taken reasonable care in the reproduction of such information, 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 the chapter titled „Industry Overview‟ beginning on page 47 of the Draft Red Herring

Prospectus. Due to possibly flawed or ineffective data collection methods or discrepancies between published

information and market practice and other problems, 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,

elsewhere.

Risks Associated with the Indian Economy

47. A slowdown in economic growth in India could cause our business to suffer.

We are incorporated in India, and all of our assets and employees (except the ones located at client locations

abroad) are located in India. As a result, we are highly dependent on prevailing economic conditions in India

and our results of operations are significantly affected by factors influencing the Indian economy. A slowdown

in the Indian economy could adversely affect our business, including our ability to grow our assets, the quality

of our assets, and our ability to implement our strategy. Factors that may adversely affect the Indian economy,

and hence our results of operations, may include:

any increase in Indian interest rates or inflation;

any scarcity of credit or other financing in India;

prevailing income conditions among Indian consumers and Indian corporations;

volatility in, and actual or perceived trends in trading activity on, India's principal stock exchanges;

variations in exchange rates;

changes in India‟s tax, trade, fiscal or monetary policies;

political instability, terrorism or military conflict in India or in countries in the region or globally,

including in India‟s various neighbouring countries;

prevailing regional or global economic conditions, including in India‟s principal export markets; and

other significant regulatory or economic developments in or affecting India.

Any slowdown in the Indian economy or in the growth of the sectors we participate in or future volatility in

global commodity prices could adversely affect our borrowers and contractual counterparties. This in turn could

adversely affect our business and financial performance and the price of our Equity Shares.

48. Our transition to IFRS reporting could have a material adverse effect on our reported results of

operations or financial condition.

Our Company may be required to prepare annual and interim financial statements under IFRS in accordance

with the roadmap for the adoption of, and convergence with, the IFRS announced by the Ministry of Corporate

Affairs, Government of India through a press note dated January 22, 2010 (“IFRS Convergence Note”). The

Ministry of Corporate Affairs by a press release dated February 25, 2011 has notified that 35 Indian Accounting

Standards are to be converged with IFRS. The date of implementation of such converged Indian accounting

standards has not yet been determined and will be notified by the Ministry of Corporate Affairs after various tax

xxviii

related issues are resolved. We have not yet determined with certainty what impact the adoption of IFRS will

have on our financial reporting. Our financial condition, results of operations, cash flow 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. This may have a material

adverse effect on the amount of income recognised during that period.

In addition, in our transition to IFRS reporting, we may encounter difficulties in the ongoing process of

implementing and enhancing our management information systems and internal controls. Moreover, our

transition may be hampered by increasing competition for the relatively small number of IFRS-experienced

accounting personnel available as more Indian companies begin to prepare IFRS financial statements. There can

be no assurance that our adoption of IFRS will not adversely affect our reported results of operations or

financial condition and any failure to successfully adopt IFRS by an agreed deadline could have a material

adverse effect on the price of our Equity Shares.

49. Our revenues could be significantly affected if the governments in countries in which our clients are

based restrict companies from outsourcing work to non-domestic corporations.

The issue of companies outsourcing services to organizations operating in other countries has become a topic of

political discussion in many countries especially in the US. In addition, there has been recent publicity about

negative experiences associated with offshore outsourcing, such as theft and misappropriation of sensitive client

data, particularly involving service providers in India. Current or prospective clients may elect to perform such

services themselves or may be discouraged from transferring these services from onshore to offshore providers

to avoid negative perceptions that may be associated with using an offshore provider. Any slowdown or reversal

of existing industry trends toward offshore outsourcing, or any legislation aimed at limiting or restricting

offshore outsourcing, could seriously harm our ability to compete effectively with competitors that provide

services from other countries.

50. A third party could be prevented from acquiring control of our Company because of anti-takeover

provisions under Indian law.

There are provisions in Indian law that may delay, deter or prevent a future takeover or change in control of our

Company. Under the takeover regulations, an acquirer has been defined as any person who, directly or

indirectly, acquires or agrees to acquire shares or voting rights or control over a company, whether individually

or acting in concert with others. Although these provisions have been formulated to ensure that interests of

investors/shareholders are protected, these provisions may also discourage a third party from attempting to take

control of our Company. Consequently, even if a potential takeover of our Company would result in the

purchase of the Equity Shares at a premium to their market price or would otherwise be beneficial to its

shareholders, such a takeover may not be attempted or consummated because of Indian takeover regulations.

51. 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 impact 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. The current central government, which came to power

in May 2009, is headed by the Indian National Congress and is 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 foreign investment and other matters affecting investment in our securities

could change as well. Additionally, any change in these policies could have a significant impact on

infrastructure development, business and economic conditions in India.

52. Instability in financial markets could materially and adversely affect our results of operations and

financial condition.

The Indian economy and financial markets are significantly influenced by worldwide economic, financial and

market conditions. Any financial turmoil, especially in the U.S. or Europe, may have a negative impact on the

Indian economy. Although economic conditions differ in each country, investors‟ reaction to any significant

developments in one country can have adverse effects on the financial and market conditions in other countries.

A loss in investor confidence in the financial systems, particularly in other emerging markets, may cause

increased volatility in Indian financial markets. Any prolonged financial crisis may have an adverse impact on

the Indian economy and us, thereby resulting in a material and adverse effect on our business, operations,

financial condition, profitability and price of our Equity Shares.

53. Natural disasters could have a negative impact on the Indian economy and cause our business to suffer.

India has experienced significant natural disasters such as earthquakes, a tsunami, floods, drought, fires and

spread of pandemic diseases such as the H5N1 avian flu and the H1N1 swine flu, in the past few years. The

extent and severity of these natural disasters determines their impact on the Indian economy and infrastructure.

Prolonged spells of abnormal rainfall and other natural calamities could have an adverse impact on the Indian

economy in which we operate, which could adversely affect our business and the price of our Equity Shares.

54. Any disruption in the supply of power, IT infrastructure, telecom lines and disruption in internet

connectivity could disrupt our business process or subject us to additional costs.

Any disruption in basic infrastructure or the failure of the Government to improve the existing infrastructure

facilities could negatively impact our business since we may not be able to provide timely or adequate services

to our clients. We do not maintain business interruption insurance and may not be covered for any claims or

damages if the supply of power, IT infrastructure, internet connectivity or telecom lines is disrupted. This may

result in the loss of a client, impose additional costs on us and have an adverse effect on our business, financial

condition and results of operations and could lead to decline in the price of our Equity Shares.

55. The complexity of transfer pricing regulations across countries may result in substantial tax liabilities to

Each country‟s transfer pricing regulations require that international transactions involving associated

enterprises be at an arm‟s-length price. Transactions between our Company and our Subsidiaries in other

countries fall into this classification, at least for purposes of Indian tax laws and regulations. Accordingly, we

will determine the pricing among our associated enterprises on the basis of detailed functional and economic

analysis involving benchmarking against transactions with entities that are not under common control. If the

applicable income tax authorities, on review of our tax returns, determine that the transfer price we applied was

not appropriate, we may incur increased tax liability, including accrued interest and penalties. These penalties

could be substantial and have an adverse effect on our business.

Prominent Notes:

1. This is a Public Issue of 40,00,000 Equity Shares of face value of ` 10/- each for cash at a price of ` [●] per

Equity Share (including share premium of ` [●] per Equity Share) aggregating to ` [●]. The Issue will

constitute 30.75% of the post Issue paid-up capital of our Company.

2. Our Company was originally incorporated as „RTEngines Software Private Limited‟ a private limited

company under the Companies Act pursuant to Certificate of Incorporation dated April 28, 2003 issued by

the Assistant Registrar of Companies, Maharashtra, Mumbai. The name of our Company was changed to

„Tejora Technologies Private Limited‟ pursuant to fresh certificate of incorporation consequent upon

change of name dated March 29, 2011 issued by the Assistant Registrar of Companies, Maharashtra,

Mumbai. Thereafter our Company was converted into a public limited company under the Companies Act

and the name of our Company was changed to „Tejora Technologies Limited‟ pursuant to fresh certificate of

incorporation consequent upon change of name on conversion to public limited company dated April 8,

2011 issued by the Deputy Registrar of Companies, Maharashtra, Mumbai. Our corporate identification

number is U72900MH2003PLC140182. For further details of our Company, please refer to the chapters

titled „General Information‟ and „History and Certain Corporate Matters‟ beginning on pages 8 and 74

respectively, of the Draft Red Herring Prospectus.

3. This being an Issue for Equity Shares representing more than 25% of the post-Issue equity share capital of

our Company, Equity Shares will be offered to the public for subscription in accordance with Rule

19(2)(b)(i) of the Securities Contracts (Regulation) Rules, 1957, as amended ("SCRR"), and the SEBI

ICDR Regulations. The Issue is being made pursuant to Regulation 26(1) of the SEBI ICDR Regulations

through the 100% Book Building Process wherein not more than 50% of the Issue shall be allocated on a

proportionate basis to Qualified Institutional Buyers (“QIBs”) (“QIB Portion”). 5% of the QIB 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. All potential non-retail Bidders, shall

participate in this Issue through the Application Supported by Blocked Amount ("ASBA") process. Retail

Bidders participating in this Issue may also utilize the ASBA process to submit their Bids. For details,

please refer to the chapter titled „Issue Procedure‟ beginning on page 149 of the Draft Red Herring

Prospectus.

4. Investors may contact any of the BRLM for any complaint pertaining to the Issue. All grievances relating to

ASBA may be addressed to the Registrar to the Issue, with a copy to the relevant SCSBs, giving full details

such as name, address of the Bidder, number of Equity Shares for which the Bidder applied, Bid Amounts

blocked, ASBA Account number and the Designated Branch of the SCSBs where the ASBA Form has been

submitted by the ASBA Bidder. For contact details of the BRLM and the compliance officer, please refer to

chapter titled „General Information‟ beginning on page 8 of the Draft Red Herring Prospectus.

5. Our Net Worth as at March 31, 2011 was ` 1209.42 lacs, as per our restated audited financial statements,

under Indian GAAP included in the Draft Red Herring Prospectus. The Net Asset Value per Equity Share as

at March 31, 2011 was ` 15.44, as per our restated audited financial statements, under Indian GAAP

included in the Draft Red Herring Prospectus. For further details, please refer to chapter titled „Financial

Information‟ beginning on page 99 of the Draft Red Herring Prospectus.

6. The average cost of acquisition per Equity Share by our Promoters is set forth in the table below:

Name of the Promoter Average cost of acquisition (in `)

Haridas Shenoy 0.17 Nitin Shenoy 0.81 Surabhi Shenoy 1.71

7. For details of Group Companies/Entities having business interest or other interests in our Company, please

refer to the chapter titled „Our Group Entities‟ beginning on page 95 of the Draft Red Herring Prospectus.

8. Except as disclosed in Annexure – XVI under chapter titled „Financial Information‟, „Our Promoters and

Promoter Group‟, „Group Entities‟ and „Capital Structure‟ on pages 99, 91, 95 and 17 respectively, of the

Draft Red Herring Prospectus, none of our Promoters, Directors, Key Managerial Personnel or Group

Entities have any business or other interest, other than to the extent of Equity Shares held by them and to

the extent of the benefits arising out of such shareholding.

9. There has been no financing arrangement whereby the Promoter Group, our Directors and their relatives

have financed the purchase, by any other person, of securities of our Company during the period of six

months immediately preceding the date of the Draft Red Herring Prospectus.

SECTION III – INTRODUCTION

SUMMARY OF OUR INDUSTRY

Global Information Technology Industry

World wide technology products and services related spend is estimated to reach USD 1.6 trillion in 2010, a

growth of 4 per cent over 2009, with emerging verticals and emerging geographies, in addition to the US,

driving growth. Worldwide hardware spends increased by 6.4 per cent on the back of a global refresh cycle. IT

services spend increased by 1.4 per cent in 2010, within which IT outsourcing grew by 2.4 per cent. Continuous

ROI focus led to BPO growth by 4 per cent, while software products rose by 3.7 per cent led by increased focus

on security, storage and application development. Within IT outsourcing, global sourcing grew by 10.4 per cent

in 2010, validating the industry‟s integral position in service delivery chain.

The year saw wide ranging contract restructuring exercises, and deal size reductions as buyers came to terms

with new business models and budgetary constraints. However multi-sourcing saw higher adoption, precipitated

by the increased maturity of Indian providers. Recent global M&A activity in the sector indicates select

acquisitions by established service providers to enhance skill and scale. While cost and talent remain essential

considerations for global sourcing, savvy customers are constantly demanding more immediate value from IT

and forward-looking strategies that support growth and innovation, service providers are adopting agile methods

focusing on operational excellence through ongoing innovation, diversification, renewed partnerships/alliances

and new business nodels.

Key takeaways:

Global economy bouncing back, significant improvement in macro-economic conditions leading to IT

spending growing by 4 per cent

Worldwide hardware spending rising by 6.4 per cent.

Emerging verticals (such as Healthcare, Government and Utilities) emerging geographies (such as Asia

Pacific, and RoW), emerging customer segments (SMB) experienced highest IT adoption

With a growth of 10.2 per cent global sourcing outpacing worldwide IT spending

Emerging technologies altering business landscape, and adding value

(Source: NASSCOM, Strategic Review 2011)

Growth of the Indian IT-BPO sector

The Indian IT-BPO sector is expected to reach USD 88.1 billion in FY 2011, and aggregate growth of 19.2 per

cent. Export revenues of IT and BPO services (excluding hardware exports) in FY 2011 are expected to grow by

18.7 per cent. As a proportion of the national GDP, the sector revenues have grown from 1.2 per cent in FY

1998 to an estimated 6.4 per cent in FY 2011. Its share of total Indian exports (merchandise plus services)

increased from less than 4 per cent in FY 1998 to almost 26 per cent in FY 2011.

While in 2009, the global recession has significantly impacted technology spending levels across the world, the

industry displayed remarkable resilience by enhanced efficiencies, invested in future growth plans along

disruptive technologies and changed existing business models to stay on the growth path. With the demand

situation improving in 2010, this ability of the industry to break-out from pre-existing moulds helped it ride the

growth curve this year.

India remains an integral part of the global sourcing strategy, and registered a growth rate twice that of other

competitors in the global sourcing arena, to account for approximately 55 per cent of the addressable global

sourcing market in 2010, up from 51 per cent in 2009. It is estimated that India-based resources account for

about 60-70 per cent of the offshore delivery capacities available across the leading multinational IT-BPO

players.

Future Outlook

The underlying theme of 2010 has been the steady recovery of the recession. Worldwide GDP, which had

declined by 0.6 per cent in 2009, grew 5 per cent in 2010 and is expected to stabilise at about 4.4. per cent in

2011. Developing nations continue to grow faster than the developed countries by atleast three times. IT spend

is directly linked to growth in GDP and in line with this trend, IT spend in 2011 is expected to grow nearly 4 per

cent. Worldwide IT spending will also benefit from the accelerated recovery in emerging markets, which will

generate more than half of the new IT spending worldwide in 2011. In 2011, growth will reflect new demand for

IT goods and services, not pent up demand from prior years. 2011 will also see a major surge in the use of

private and public cloud and mobile computing on a variety of devices and through a range of new applications.

Hardware is likely to grow the fastest at about 7 per cent, led by the refresh cycle in Government sector.

Shipments of app-capable, non-PC mobile devices (smartphones, media tablets) are expected to outnumber PC

shipments.

IT services is expected to grow by about 3.5 per cent in 2011 and 4.5 per cent in 2012. While focus on cost

control and efficiency/productivity remain, customers are also evaluating how investments in IT impact can

further business goals – ROI led transformation – leading to increase in project-based spending. Services such as

virtualisation, consolidation, and managed services that focus on ROI in the short term will drive opportunities

in the market. Emerging Asian enterprises across multiple industries will continue to accelerate services

spending in their efforts to challenge existing global MNCs. Organisations will look for alternative IT models –

Cloud, on demand services as SaaS – in order to reduce hardware infrastructure costs and provide stability on

demand.

SUMMARY OF OUR BUSINESS

Tejora Technologies Limited was originally incorporated as RTEngines Software Private Limited in the year

2003 in Mumbai.

We provide a wide range of Technology Consulting, Cloud Computing & SaaS, Mobile Application

Development, Social Network Development, Enterprise Application Development & Maintenance, Product

Design, Engineering, Development & Testing, and Product Support services. Our expertise with the

technologies, applications, standards, regulations and compliances that are relevant in each domain, quality of

service & global resource base, enables us to offer a distinctive value proposition to our clients. Located in

Mumbai, we believe that we act as an effective enabler to achieving our clients' business, technical, operational,

and financial objectives, through proper product engineering techniques and technology skills.

Our Global delivery model combined with our smart asset product range helps organizations to improve their

business processes, functions through the effective application of Enterprise solutions that align with

organization‟s business objectives and strategies.

Our key expertise and the Domain verticals on which we work can be represented as under:

SUMMARY OF OUR FINANCIAL INFORMATION

Statement of Assets and Liabilities (As Restated) (` in Lacs)

Particulars

For the Year Ended at March 31

2007 2008 2009 2010 2011

A. Fixed Assets

Gross Fixed Assets 219.74 269.32 271.87 479.82 733.73

Less : Accumulated Depreciation 81.67 128.43 165.39 198.45 330.92

Net Fixed Assets 138.07 140.89 106.47 281.37 402.81

Less:- Revaluation reserves - - - - -

Net Fixed Assets After Revaluation

Reserves 138.07 140.89 106.47 281.37 402.81

Capital Work in Progress - - - - -

Total Fixed Assets 138.07 140.89 106.47 281.37 402.81

B. Investments 133.54 172.26 173.54 112.67 113.31

C. Current Assets, Loans & Advances

Sundry Debtors 312.45 158.02 88.10 188.61 866.33

Cash and Bank Balances 97.23 46.27 68.18 10.63 557.52

Loans and Advances 48.97 254.97 273.15 473.04 74.58

Sundry Deposit 65.78 66.22 17.64 18.64 18.39

Deferred Tax Assets 1.00 4.38 7.93 0.36

Total (C) 525.43 529.85 455.00 691.28 1,516.82

D. Liabilities & Provisions

Secured Loans 43.00 68.45 34.31 9.89 75.86

Unsecured Loans 81.60 92.75 31.88 42.05 -

Deferred Tax Liability (Net) - - - - 23.46

Current Liabilities 5.11 4.01 4.90 288.82 620.79

Provisions 12.95 28.86 20.49 30.60 103.42

Total (D) 142.66 194.08 91.58 371.36 823.53

E. Net Worth ( A + B+C-D ) 654.37 648.93 643.44 713.95 1,209.42

F. Represented by

Equity Share Capital 100.00 100.00 100.00 100.00 783.41

Share Premium - - - - 240.12

Share Application Money Pending allotment - - - - -

Reserves & Surplus

General Reserves 460.00 460.00 460.00 480.00 50.00

Profit & Loss Account 94.37 88.93 83.44 133.96 199.25

Total 654.37 648.93 643.44 713.96 1,272.78

Less : - Miscellaneous Expenditure not w/off - - - - 63.37

G. Net Worth 654.37 648.93 643.44 713.96 1,209.42

Summary Statement of Profit and Loss, As Restated

(` in Lacs)

Particulars

2007 2008 2009 2010 2011

Income

Sales & Operating Incomes

Export Income

Income from Software Services 974.34 817.92 434.17 530.58 726.80

Software Trading 0.00 0.00 0.00 0.00 814.66

Domestic Income

Other Income 2.47 2.22 1.51 54.43 5.19

Increase/(Decrease) in Inventory 0.00 0.00 0.00 0.00 0.00

Total Income 976.80 820.14 483.76 2249.15 3507.61

Expenditure

Purchase 0.00 0.00 0.00 1727.76 2528.25

Direct cost of Sales / Services 101.35 135.55 24.42 87.12 120.18

Personnel Cost 208.11 264.00 244.33 154.65 226.51

Administrative and Other Expenses 126.80 293.67 169.97 139.84 151.99

Total Operating Expenses 436.26 693.22 438.72 2109.37 3026.93

PBDIT 540.54 126.92 45.04 139.78 480.68

Less: Finance Cost 2.83 6.54 7.28 3.18 4.68

PBDT 537.72 120.38 37.76 136.60 476.01

Less: Depreciation & Amortisation 38.48 42.64 36.96 33.05 135.88

PBT 499.24 77.74 0.80 103.55 340.13

Add / ( Less) : Provision for Tax

Current Tax 6.05 10.48 5.95 24.00 68.00

Fringe Benefit Tax 3.56 5.89 3.90 1.45 0.00

Deferred Tax Liability (1.00) (3.38) (3.56) 7.57 23.82

Profit After Tax 490.63 64.75 (5.49) 70.52 248.31

Profit or Loss as Restated 490.63 64.75 (5.49) 70.52 248.31

Balance brought forward from previous

year 17.77 94.37 88.93 83.44 133.96

Net Profit Available for Appropriation 508.40 159.13 83.44 153.96 382.27

Proposed Dividend on Equity Shares 100.00 60.00 0.00 0.00 0.00

Tax on Dividend 14.03 10.20 0.00 0.00 0.00

Transfer to General Reserves 300.00 0.00 0.00 20.00 50.00

Capitalized during the year for Bonus

Shares 0.00 0.00 0.00 0.00 133.01

Balance carried forward as restated 94.37 88.93 83.44 133.96 199.25

Summary Statement of Cash Flow:

(` in Lacs)

Particulars

2007 2008 2009 2010 2011

A Cash Flow from Operating Activities

Profit before tax, as restated 499.24 77.74 0.80 103.55 340.13

Adjustments for

Depreciation 38.48 42.64 36.96 33.05 135.88

Interest 2.83 6.54 7.28 3.18 4.68

Loss/(Profit) on sale of Fixed Asset (0.55) 4.12 0.24

Operating Income before working capital

changes 540.00 131.04 45.04 139.78 480.92

Adjustments for:

Decrease/(Increase) in Sundry Deposit (49.33) (0.44) 48.58 (1.00) 0.25

Decrease/(Increase) in Sundry Debtors (149.86) 154.44 69.92 (100.51) (677.72)

Decrease/(Increase) in Loans & Advances (15.86) (206.00) (18.18) (199.89) 398.45

Decrease/(Increase) in Misc. Exps (63.37)

Increase/(Decrease) in Current Liabilities 2.44 (1.10) 0.89 283.92 331.97

Increase/(Decrease) in Provisions (21.50) 15.90 (8.37) 10.11 72.81

Cash Generated from Operations 305.89 93.84 137.88 132.41 543.32

Direct Taxes (Net) 9.61 16.36 9.85 25.45 68.00

Net Cash Flow from Operating Activities 296.29 77.48 128.03 106.96 475.32

B Cash Flow from Investing Activities

Purchase of Fixed Assets (89.60) (45.47) (2.55) (207.95) (257.32)

Decrease /(Increase) in Investments (133.19) (38.72) (1.28) 60.87 (0.64)

Profit/(Loss) on sales of fixed assets 0.55 (4.12) 0.00 0.00 (0.24)

Net Cash used from Investing Activities (222.24) (88.31) (3.82) (147.08) (258.20)

C Cash Flow from Financing Activities

- Share Capital 0.00 0.00 0.00 0.00 70.40

- Share Premium 0.00 0.00 0.00 0.00 240.12

Dividends paid (100.00) (60.00) 0.00 0.00 0.00

Tax on Dividend (14.03) (10.20) 0.00 0.00 0.00

Change in the Borrowings

- Secured Loans 43.00 25.46 (34.15) (24.41) 65.97

- Unsecured Loans 81.60 11.15 (60.87) 10.17 (42.05)

Interest Paid (2.83) (6.54) (7.28) (3.18) (4.68)

Net Cash Flow from Financing Activities 7.75 (40.13) (102.29) (17.43) 329.76

Net Increase/(Decrease) in Cash & Cash

Equivalents (A+B+C) 81.79 (50.96) 21.91 (57.54) 546.89

Cash & Cash Equivalents at Beginning of

the Year 15.43 97.23 46.27 68.18 10.63

Cash & Cash Equivalents at End of the

Year 97.23 46.27 68.18 10.63 557.52

Notes:

1. The above Cash Flow Statement has been prepared under the "Indirect Method" as set out in

Accounting Standard -3 'Cash Flow Statement'.

2. Previous year's figures have been regrouped / rearranged /recasted wherever necessary to make them

comparable with those of current year.

THE ISSUE

Equity Shares offered:

Public Issue of Equity Shares by our Company 40,00,000 Equity Shares

Of which1

1. Qualified Institutional Buyers portion (QIBs) QIB Portion of not more than 20,00,000 Equity Shares

constituting not more than 50% of the Issue

Of which

Mutual Fund Portion 1,00,000 Equity Shares

Balance for all QIBs Portion 19,00,000 Equity Shares

2. Non-Institutional Portion 6,00,000 Equity Shares constituting not less than 15%

of the Issue

3. Retail Portion 14,00,000 Equity Shares constituting not less than

35% of the Issue

Equity Shares outstanding prior to the Issue 90,09,222 Equity Shares

Equity Shares outstanding after the Issue 1,30,09,222 Equity Shares

Use of Issue proceeds Please refer to the chapter titled „Objects of the Issue‟

beginning on page 27 of the Draft Red Herring

Prospectus.

1 Allocation to all categories shall be made on a proportionate basis subject to valid Bids received at or above the Issue

Price. Under-subscription, if any, in any category would be allowed to be met with spill over from any other category or

combination of categories at the discretion of our Company, in consultation with the BRLM, and the Designated Stock

Exchange; and in accordance with applicable laws, rules, regulations and guidelines, subject to valid bids being received at

or above the Issue Price. For more information, please refer to chapter titled „Issue Procedure‟ beginning on page 149 of

the Draft Red Herring Prospectus.

GENERAL INFORMATION

Our Company was originally incorporated as „RTEngines Software Private Limited‟ a private limited company

under the Companies Act pursuant to Certificate of Incorporation dated April 28, 2003 issued by the Assistant

Registrar of Companies, Maharashtra, Mumbai. The name of our Company was changed to „Tejora

Technologies Private Limited‟ pursuant to fresh certificate of incorporation consequent upon change of name

dated March 29, 2011 issued by the Assistant Registrar of Companies, Maharashtra, Mumbai. Thereafter our

Company was converted into a public limited company under the Companies Act and the name of our Company

was changed to „Tejora Technologies Limited‟ pursuant to fresh certificate of incorporation consequent upon

change of name on conversion to public limited company dated April 8, 2011 issued by the Deputy Registrar of

Companies, Maharashtra, Mumbai. Our Company is promoted by Haridas Shenoy, Nitin Shenoy and Surabhi

Shenoy.

Registered Office of our Company:

Unit No.2, A Wing,

8th Floor, Prism Tower,

Mindspace, Goregaon (West),

Tel: +91 - 22 - 4003 4222

Fax: +91- 22- 4003 4226

Email: ipo@tejora.com

Website: tejora.com

For details of changes to our Registered Office, please refer to the chapter titled „History and Certain Corporate

Matters‟ beginning on page 74 of the Draft Red Herring Prospectus.

Our Company is registered with the Registrar of Companies, Maharashtra, Mumbai with corporate identification

number U72900MH2003PLC140182.

Registrar of Companies:

Registrar of Companies, Maharashtra, Mumbai

Everest Building, 100, Marine Drive,

Our Board of Directors:

The following table sets out details regarding our Board as on the date of the Draft Red Herring Prospectus:

Name, Designation and

Occupation

(in years)

DIN Address

1. Nitin Shenoy

Designation: Managing

Director

(Executive and Non

Independent)

Occupation: Business

36 01394117 102, Ivory Heights, 2nd

Cross Lane, Jhulelal

Chowk, Lokhandwala,

Andheri (West),

Mumbai – 400 053,

Maharashtra

2. Surabhi Shenoy

Designation: Executive

Director

(Executive and Non

Independent)

35 02293497 102, Ivory Heights, 2nd

Cross Lane, Jhulelal

Chowk, Lokhandwala,

Andheri (West), Mumbai

– 400 053, Maharashtra

3. Neeshchal Mehta

Designation: Director

43 00128406 C/104, Highland

Harmony,

Mahavir Nagar,

Name, Designation and

Occupation

(in years)

DIN Address

(Non-executive and

Independent)

Occupation: Professional

Kandivali (West),

Mumbai – 400067,

Maharashtra

4. Chhotulal Bhagwat Designation: Director

(Non-executive and

Independent)

49 03534822 Flat No. 104,

First Floor,

Neha Apartments,

Plot No. 7,

Sector No. 20 C,

Airoli,

Navi Mumbai – 400 708

Maharashtra

5. Roofi Shaikh Designation: Director

(Non-executive and

Independent)

35 03533136 22 A/3/ 10,

Budhwar Peth,

Parvati Deshmukh Nagar,

Solapur – 413 002

Maharashtra

For detailed profile of our Directors, please refer to the chapter titled „Our Management‟ beginning on page 79

Company Secretary and Compliance Officer:

Rohit Kudtarkar

Unit No.2, A Wing,

Tel: +91- 22 - 4003 4222

Fax: +91- 22 - 4003 4226

Email: cs@tejora.com

Investors may contact our Company Secretary and 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 Equity Shares in the respective beneficiary account or refunds.

For all Issue related queries and for redressal of complaints, investors may also write to the Book

Running Lead Manager. All complaints, queries or comments received by SEBI shall be forwarded to the

Book Running Lead Manager, who shall respond to the same.

All grievances relating to the ASBA process may be addressed to the Registrar to the Issue, with a copy to

the SCSBs or the Syndicate / Sub – Syndicate Members to whom the Bid was submitted (at ASBA

Bidding Locations), giving full details such as name and address of the applicant, number of Equity

Shares applied for, Bid Amount blocked, ASBA Account number and the Designated Branch of the

SCSBs or details of the Syndicate / Sub – Syndicate Members to whom the Bid was submitted (at ASBA

Bidding Locations) where the ASBA Form was submitted by the ASBA Bidders.

Book Running Lead Manager:

Unicon Capital Services Private Limited

3rd Floor, „A‟ wing, Vilco Center,

8, Subhash Road, Vile Parle (East),

Tel No: +91 - 22 - 3390 1234

Fax No: +91- 22 - 3390 1547

Website: www.uniconindia.in

Email: mb@unicon.in

Investor Grievance ID: investors@unicon.in

Contact Person: Pritam Pandya / Ganesh Hadvale

SEBI Registration No: INM000011609

Registrar to the Issue:

Bigshare Services Private Limited

E-2, Ansa Industrial Estate,

Sakivihar Road, Saki Naka,

Andheri (East),

Mumbai – 400 072

Maharashtra

Tel No: +91–22 – 4043 0200

Fax No: +91–22– 2847 5207

Website: www.bigshareonline.com

Email: ipo@bigshareonline.com

Contact Person: Ashok Shetty

SEBI Registration No: INR000001385

Legal Advisor to the Issue:

M/s. Crawford Bayley & Co.

State Bank Buildings,

floor, N. G. N. Vaidya Marg,

Fort, Mumbai - 400 023,

Maharashtra

Tel No: +91–22–2266 8000

Fax No: +91–22–2266 0355

Bankers to our Company:

Dena Bank

Tarapore Towers CHS Limited,

Ground Floor, Phase II, New Link Road,

Lokhandwala Complex,

Andheri (West), Mumbai – 400 053,

Maharashtra

Tel No: +91- 22- 2639 6701

Fax No: +91- 22- 2639 6702

Email: lokhan@denabank.co.in

Website: www.denabank.com

Contact Person: Sunil Pai

Bankers to the Issue / Escrow Collection Bank(s):

The Bankers to the Issue shall be appointed prior to filing of the Red Herring Prospectus with the RoC.

Syndicate Member(s):

The Syndicate Member(s) will be appointed prior to filing the Red Herring Prospectus with the RoC.

Self Certified Syndicate Banks:

The SCSBs are as per the updated list available on SEBI‟s website http://www.sebi.gov.in/pmd/scsb.html

Refund Banker(s):

The Refund Banker(s) shall be appointed prior to filing of the Red Herring Prospectus with the RoC.

Statutory Auditor to our Company:

M/s. Gopal Rao & Associates, Chartered Accountants

318, Creative Industries,

Road number 2, Kalina,

Santacruz (East),

Mumbai – 400 098,

Maharashtra

Tel No: +91–22– 3016 3626/3620

Fax No.: +91–22– 6692 0223

Email: ngraoca@yahoo.com

Contact Person: N. G. Rao

Firm Registration Number: 127055W

Independent Auditor (Peer Review Certified)*

M/s. L.T. Jadav & Co., Chartered Accountants

601, Madhuban, 6th Floor,

T.P.S. Road,

Borivali (West),

Mumbai – 400 092,

Maharashtra

Tel No: +91–22– 2899 1344/0515

Fax No.: +91–22– 2682 4516

Email: lalitjadav51@yahoo.co.in

Contact Person: Lalit Jadav

* M/s. L.T. Jadav & Co., Chartered Accountants hold a peer reviewed certificate dated February 11, 2010

issued by the Peer Review Board of The Institute of Chartered Accountants of India, New Delhi.

Statement of responsibilities:

Unicon Capital Services Private Limited is the sole BRLM to the Issue and shall be responsible for the

following activities:

Sr. No. Activity

1. Capital structuring with the relative components and formalities such composition of debt and equity,

type of instruments, etc.

2. Conducting a Due diligence of our Company‟s operations / management / business plans / legal, etc.

Drafting and designing the Draft Red Herring Prospectus/ Red Herring Prospectus/ Prospectus.

Ensuring compliance with the SEBI (ICDR) Regulations, 2009 and other stipulated requirements and

completion of prescribed formalities with the Stock Exchanges (pre-issue), RoC and SEBI.

3. Primary co-ordination with SEBI, RoC and Stock Exchanges up to bidding and coordinating

interface with lawyers for agreements.

4. Appointment of the Registrar, Bankers to the issue and appointment of other intermediaries viz.

printers and advertising agency

5. Primary coordination of drafting/proofing of the design of the Prospectus, bid forms including

memorandum containing salient features of the Prospectus with the printers. Primary coordination of

the drafting and approving the statutory advertisement.

6. Drafting and approving all publicity material other than statutory advertisement as mentioned in (4)

above including corporate advertisement, brochure, etc.

7. Retail and HNI segment Marketing, Which will cover inter alia:

Preparation of road show presentation.

Finalising centres for holding Brokers‟ conference

Finalising media, marketing and PR Strategy

Follow up on distribution of publicity and issue material including application form, brochure

and deciding on quantum of issue material

Finalising collection centres as per schedule III of SEBI (ICDR) Regulations, 2009

8. Institutional Marketing, which will cover inter alia:

Finalisation of list of investors.

Finalisation of one to one meetings and allocation of institutions.

Finalisation of presentation material

9. Managing Book and co-ordination with stock Exchanges for bidding terminals, mock trading etc.

10. Pricing and QIB allocation

11. Follow – up with the bankers to the issue to get quick estimates of collection and advising the issuer

about closure of the issue, based on the correct figures.

12. The post-Issue activities for the Issue will involve essential follow up steps, which include finalizing

basis of allotment / weeding out of multiple applications, the listing of instruments and dispatch of

certificates/demat credits or refunds and dematerialized delivery of shares with the various agencies

connected with the work such as the Registrars to the Issue and Bankers to the Issue, Self Certified

Syndicate Banks, the bank handling refund business. The Book Running Lead Manager shall be

responsible for ensuring that these agencies fulfil their functions and enable it to discharge this

responsibility through suitable agreements with our Company.

Credit Rating:

This being an issue of Equity Shares, there is no requirement of credit rating for the Issue.

IPO Grading Agency

IPO Grading:

This Issue has been graded by [●], and has been assigned the “IPO Grade [●]” indicating [●] through its letter

dated [●], which is valid for a period of [●] months. The IPO grading is assigned on a five point scale from 1 to

5 wherein an “IPO Grade 5” indicates strong fundamentals and “IPO Grade 1” indicates poor fundamentals.

A copy of the report provided by [●], furnishing the rationale for its grading, will be annexed to the Red Herring

Prospectus and will be made available for inspection at our Registered Office from 10.00 a.m. to 4.00 p.m. on

working days from the date of filing of the Red Herring Prospectus, until the Bid/Issue Closing Date.

Expert Opinion:

Except the report of [●] in respect of the IPO grading of this Issue (a copy of which will be annexed to the Red

Herring Prospectus as Annexure I), furnishing the rationale for its grading and the reports of the Statutory

Auditor of our Company on the restated financial statements and Statement of Tax Benefits, included in the

Draft Red Herring Prospectus, our Company has not obtained any expert opinions.

Trustees:

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

Appraisal and Monitoring Agency:

The objects of the Issue have not been appraised by any agency. The Objects of the Issue and means of finance,

therefore, are based on internal estimates of our Company. As the net proceeds of the Issue will be less than `

50,000 lacs, under the sub-regulation (1) of Regulation 16 of SEBI (ICDR) Regulations, 2009 it is not required

that a monitoring agency be appointed by our Company.

However, as per the Clause 49 of the Listing Agreement to be entered into with the Stock Exchanges upon

listing of the Equity Shares and in accordance with the corporate governance requirements, the Audit

Committee of our Company would be monitoring the utilization of the Issue Proceeds.

Book Building Process:

Book Building refers to the process of collection of Bids made by the investors on the basis of the Red Herring

Prospectus. The Issue Price shall be determined by our Company, in consultation with the Book Running Lead

Manager, after the Bid/Issue Closing Date. The principal parties involved in the Book Building Process are:

1. Our Company;

2. BRLM, in this case being Unicon Capital Services Private Limited;

3. Syndicate Member(s) who are intermediaries registered with SEBI or registered as brokers with the Stock

Exchange(s) and eligible to act as underwriters. Syndicate members are appointed by the BRLM;

4. Registrar to the issue, in this case being Bigshare Services Private Limited;

5. Banker(s) to the issue, Refund Bank(s); and

6. Self Certified Syndicate Banks.

This Issue is being made in compliance with Regulation 26(1) of the SEBI ICDR Regulations and through the

Book Building Process. In accordance with Regulation 26(4) of the SEBI ICDR Regulations, our Company shall

ensure that the number of Allottees shall be not less than 1,000.

This being an Issue for Equity Shares representing more than 25% of the post-Issue equity share capital of our

Company, Equity Shares will be offered to the public for subscription in accordance with Rule 19(2)(b)(i) of the

SCRR and SEBI ICDR Regulations. The Issue is being made pursuant to Regulation 26(1) of the SEBI ICDR

Regulations through the 100% Book Building Process wherein not more than 50% of the Issue shall be allocated

on a proportionate basis to Qualified Institutional Buyers (“QIBs”) (“QIB Portion”). 5% of the QIB 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 Net Issue shall be

available for allotment to Non Institutional Bidders and not less than 35% of the Net Issue shall be available for

allotment to Retail Individual Bidders on a proportionate basis, subject to valid Bids being received at or above

the Issue Price. Under subscription, if any, in any category, would be allowed to be met with spill over from any

other category or combination of categories at the discretion of our Company, in consultation with the Book

Running Lead Manager and the Designated Stock Exchange.

Under-subscription, if any, in any category, would be allowed to be met with spill-over from any other category

or combination of categories, at the discretion of our Company, in consultation with the BRLM and the

Designated Stock Exchange and in accordance with applicable laws, rules, regulations and guidelines, subject to

valid Bids being received at or above the Issue Price. For further details, please refer to the chapter titled „Issue

Procedure‟ beginning on page 149 of the Draft Red Herring Prospectus.

Pursuant to SEBI circular number CIR/CFD/DIL/1/2011 dated April 29, 2011 all non- retail Investors i.e.

QIBs and Non Institutional Investors are mandatorily required to utilise the ASBA facility to submit

their Bids and participate in this Issue. For further details please refer to the chapter titled „Issue

Attention of all QIBs is specifically drawn to the fact that all QIBs are required to pay the entire Bid

Amount at the time of the submission of the Bid cum Application Form. In accordance with the SEBI

ICDR Regulations, QIBs Bidding in the QIB Portion are not allowed to withdraw their Bids after the QIB

Bid Closing Date. Further, allocation to QIBs will be on a proportionate basis. For further details, please

refer to the chapter titled „Terms of the Issue‟ and „Issue Procedure‟ beginning on pages 144 and 149

respectively, of the Draft Red Herring Prospectus.

Our Company will comply with the SEBI ICDR Regulations and any other ancillary directions issued by SEBI

for this Issue. In this regard, our Company has appointed the BRLM to manage this Issue and procure

subscriptions to this Issue.

The Book Building Process is subject to change from time to time and investors are advised to make their

own judgment about an investment through this process prior to submitting a Bid in the Issue.

Steps to be taken by the Bidders for making a Bid or application in this Issue:

1. Check eligibility for making a bid (for further details, please refer to the chapter titled „Issue Procedure‟

beginning on page 149 of the Draft Red Herring Prospectus). Specific attention of ASBA Bidders is invited

to the chapter titled „Issue Procedure‟ beginning on page 149 of the 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, as the case may be;

3. Ensure that the Bid cum Application Form is duly completed as per the instructions given in the Red

Herring Prospectus and in the respective forms;

4. Ensure that you have mentioned your PAN in the Bid cum Application Form or ASBA Form (for further

details, please refer to the chapter titled „Issue Procedure‟ beginning on page 149 of the Draft Red Herring

Prospectus). Bidders are specifically requested not to submit their GIR number instead of the PAN as the

Bid is liable to be rejected on this ground;

5. Ensure the correctness of your Demographic Details (as defined under the paragraph titled „Bidder‟s

Depository Account Details‟, in chapter titled „Issue Procedure‟ beginning on page 149 of the Draft Red

Herring Prospectus), given in the Bid cum Application Form, and the details recorded with your Depository

Participant; and

6. Bids by ASBA Bidders have to be submitted to the SCSBs at the Designated Branches or members of the

syndicate (at ASBA Bidding Locations). ASBA Bidders should ensure that their bank accounts have

adequate credit balance at the time of submission to the SCSBs to ensure that their ASBA Form is not

rejected.

Illustration of Book Building and Price Discovery Process

(Investors should note that the following is solely for the purpose of illustration and is not specific to this Issue)

Bidders (including ASBA Bidders) can bid at any price within the price band. For instance, assuming a price

band of ` 200 to ` 240 per share, an issue size of 3,000 equity shares and receipt of five bids from Bidders

details of which are shown in the table below. A graphical representation of the consolidated demand and price

would be made available at the website of the BSE (www.bseindia.com) and the NSE (www.nseindia.com)

during the bidding period. The illustrative book shown below shows the demand for the shares at various prices

and is collated from bids from various investors.

Number of equity

shares Bid for

Bid Price

Cumulative Equity

Shares Bid for

Subscription

500 240 500 16.67%

1,000 230 1,500 50.00%

1,500 220 3,000 100.00%

2,000 210 5,000 166.67%

2,500 200 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 quantum of shares is the price at which the book cuts off, i.e., ` 220 in the above example. The

Issuer, in consultation with the BRLM will finalize the issue price at or below such cut off price, i.e. at or below

` 220. All bids at or above this issue price and cut off bids by Retail Individual Bidders are valid bids and are

considered for allocation in the respective categories.

Bid/Issue Program:

Bidding /Issue Period:

BID/ISSUE OPENS ON [●]

BID/ISSUE CLOSES ON (QIB BIDDERS) * [●]

BID/ISSUE CLOSES ON (EXCEPT QIB BIDDERS) [●]

*Our Company may consider closing the Bidding by QIB Bidders one Working Day prior to the Bid/Issue

Closing Date subject to the Bid/Issue period being for a minimum of three Working Days.

Bids and any revision in Bids shall be accepted only between 10 a.m. and 5.00 p.m. (Indian Standard Time)

during the Bid / Issue Period as mentioned above at the Bidding Centres mentioned on the Bid cum Application

Form or in case of Bids submitted through ASBA Form, the Designated Branches or the Syndicate/Sub-

syndicate members (at ASBA Bidding Locations) except that on the Bid / Issue Closing Date (which for the

QIBs may be a day prior to that of the other Bidders), the Bids shall be accepted only between 10 a.m. and 3.00

p.m. (Indian Standard Time) and uploaded till (i) 4.00 p.m. in case of Bids by QIBs, (ii) until 4.00 p.m in case of

Bids by Non Institutional Bidders, and (iii) until 5.00 p.m. in case of Bids by Retail Individual Bidders, which

may be extended up to such time as deemed fit by the Stock Exchanges after taking into account the total

number of applications received up to the closure of timings and reported by BRLM to the Stock Exchanges

within half an hour of such closure.

Due to limitation of the time available for uploading the Bids on the Bid/Issue Closing Date, the Bidders are

advised to submit their Bids one Working Day prior to the Bid / Issue Closing Date and, in any case, no later

than 3.00 p.m. (Indian Standard Time) on the Bid/Issue Closing Date. Bidders are requested to note that due to

clustering of last day applications, as is typically experienced in public offerings, some Bids may not get

uploaded on the last date. Such Bids that cannot be uploaded will not be considered for allocation under the

Issue. Bids not uploaded in the book would be rejected. If such Bids are not uploaded, our Company, BRLM,

Syndicate Members, Sub-syndicate members and the SCSBs will not be responsible. Bids will be accepted only

on Working Days. Bids by ASBA Bidders shall be uploaded by the SCSBs in the electronic system to be

provided by the NSE and the BSE.

On the Bid/Issue Closing Date, extension of time may 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 timings for acceptance of Bid cum Application Forms and ASBA Form as stated herein and reported

by the BRLM to the Stock Exchanges within half an hour of such closure. All times mentioned in the Draft Red

Herring Prospectus are Indian Standard Time.

Our Company in consultation with the BRLM reserves the right to revise the Price Band during the Bid/Issue

Period in accordance with the SEBI ICDR Regulations, provided that the Cap Price is 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 Floor

Price can be revised up or down to a maximum of 20% of the Floor Price advertised at least two Working Days

before the Bid /Issue Opening Date.

In case of revision of the Price Band, the Bid / Issue Period will be extended for a minimum of three

additional 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, if applicable, will be widely disseminated by

notification to the BSE and the NSE, by issuing a press release and also by indicating the changes on the

websites of the BRLM and at the terminals of the Syndicate.

Withdrawal of the Issue:

Our Company, in consultation with the BRLM, reserves the right not to proceed with the Issue at any time after

the Bid / Issue Opening Date, but prior to allotment, without assigning any reason thereof. In such an event, it

shall issue a public notice, within 2 days of the Bid / Issue Closing Date. The public notice shall be issued in the

same newspapers where, the pre-Issue advertisement had appeared. The Stock Exchanges where the specified

securities were proposed to be listed shall also be informed promptly.

Notwithstanding the foregoing, the Issue is also subject to obtaining (i) the final listing and trading approvals of

the Stock Exchanges, which our Company shall apply for after Allotment; and (ii) the final RoC approval of the

Prospectus after it is filed with the RoC.

In terms of the SEBI ICDR Regulations, QIB Bidders shall not be allowed to withdraw their Bid after the QIB

Bid / Issue Closing Date.

If our Company withdraws the Issue and thereafter determines that it will proceed with an IPO, our Company

shall be required to file a fresh Draft Red Herring Prospectus with SEBI.

Underwriting Agreement:

After the determination of the Issue Price but prior to filing of the Prospectus with RoC, we intend to enter into

an Underwriting Agreement with the Underwriters for the Equity Shares proposed to be issued through this

Issue. It is proposed that pursuant to the terms of the Underwriting Agreement, the BRLM shall be responsible

for bringing in the amount devolved in the event that the Syndicate Member(s) do not fulfil their underwriting

obligations. The underwriting shall be to the extent of the bids procured by each Underwriter, including through

its respective syndicates/sub-syndicates. Pursuant to the terms of the Underwriting Agreement, the obligations

of the Underwriters are several and are subject to certain conditions, as specified therein.

The Underwriters have indicated their intention to underwrite the following number of Equity Shares:

Name and address of the Underwriter/(s) Indicated Number of

Equity Shares to be

Underwritten

Amount Underwritten

(` lacs)

Unicon Capital Services Private Limited

Floor, „A‟ wing, Vilco Center,

8, Subhash Road, Vile Parle (East),

Mumbai – 400 057, Maharashtra.

Tel No: +91 - 22 - 3390 1234

Fax No: +91- 22 - 3390 1547

Website: www.uniconindia.in

Email: mb@unicon.in

[●] [●]

Name and address of the Underwriter/(s) Indicated Number of

Equity Shares to be

Underwritten

Amount Underwritten

(` lacs)

Investor Grievance ID: investors@unicon.in

Contact Person: Pritam Pandya / Ganesh

Hadvale

SEBI Registration No: INM000011609

[●] [●] [●]

Total 40,00,000 [●]

(This portion has been intentionally left blank and will be filled in before filing of the Prospectus with RoC)

The above mentioned amount is an indicative underwriting and would be finalised after the determination of the

Issue Price and actual Allocation of the Equity Shares. The above underwriting agreement is dated [] and has

been approved by the Board of Directors on [].

In the opinion of the Board of Directors of our Company (based on a certificate given by the Underwriters), the

resources of all the above mentioned Underwriter(s) are sufficient to enable them to discharge their respective

underwriting obligations in full. All the above-mentioned Underwriter(s) are registered with SEBI under Section

12(1) of the SEBI Act or registered as brokers with the Stock Exchange(s).

Allocation among the Underwriter(s) may not necessarily be in proportion to their underwriting commitments.

Notwithstanding the above table, the Underwriters shall be severally responsible for ensuring payment with

respect to the Equity Shares allocated to investors procured by them. In the event of any default in payment, the

respective Underwriter(s), in addition to other obligations defined in the Underwriting Agreement, will also be

required to procure subscriptions for Equity Shares to the extent of the defaulted amount, in accordance with the

Underwriting Agreement.

The underwriting arrangements mentioned above shall not apply to the subscriptions by the ASBA Bidders in

the Issue. The underwriting agreement shall list out the role and obligations of each Syndicate Member.

CAPITAL STRUCTURE

The share capital of our Company as on the date of the Draft Red Herring Prospectus and after giving effect to

the Issue, is set forth below:

(` in lacs)

No. Particulars

Aggregate

Nominal

Aggregate

value at

A Authorised Share Capital

1,50,00,000 Equity Shares 15,00,00,000

B Issued, Subscribed and Paid Up Share Capital before the Issue

90,09,222 Equity Shares 9,00,92,220

C Present Issue to the Public in terms of the Draft Red Herring Prospectus(a)

40,00,000 Equity Shares(b)

4,00,00,000 [●]

D Issued, Subscribed and Paid Up Share Capital after the Issue

1,30,09,222 Equity Shares 13,00,92,220

E Share Premium Account

Before the Issue 2,40,12,000

After the Issue [●]

a) The Issue has been authorised by the Board of Directors vide a resolution passed at its meeting held on

June 1, 2011 and by the shareholders of our Company vide a special resolution passed pursuant to section

81(1A) of the Companies Act at the AGM held on June 25, 2011.

b) Subject to valid Bids being received at or above the Issue Price, under-subscription, if any, in any portion

would be met with spillover from other categories, at the discretion of our Company, in consultation with

the BRLM and the Designated Stock Exchange. Investors may note that in case of over-subscription in the

Issue, allotment to QIB Bidders, Non-Institutional Bidders and Retail Individual Bidders shall be on a

proportionate basis.

NOTES TO CAPITAL STRUCTURE

1. Details of Increase in Authorised Share Capital

Since the incorporation of our Company, the authorised share capital of our Company has been altered in

the manner set forth below:

Particulars of Change Date of

Shareholders‟

Meeting

AGM/EGM

From To

` 10,00,000 consisting of 1,00,000 Equity shares of ` 10 each. On incorporation -

` 10,00,000 consisting of 1,00,000

Equity shares of ` 10 each.

` 5,00,00,000 consisting of

50,00,000 Equity shares of ` 10

March 31, 2006 EGM

50,00,000 Equity shares of ` 10

1,50,00,000 Equity shares of ` 10

February 26, 2011 EGM

2. History of Equity Share Capital of our Company:

Date of

Allotment /

Fully Paid-

Number of

Equity

Shares

allotted

Nature of

Consideration

Nature of

allotment

Cumulative

number of

Shares

Cumulative

Paid up

Capital

Cumulative

Securities

Premium (` )

April 28,

10,000 10 10 Cash Initial

Subscription(1)

10,000 1,00,000 Nil

March 25,

10,000 10 10 Cash Preferential

allotment (2)

20,000 2,00,000 Nil

March 28,

allotment (3)

76,000 760,000 Nil

March 24,

allotment (4)

1,00,000 1,000,000 Nil

March 31,

9,00,000 10 Nil Other than

Bonus Issue (5)

10,00,000 10,000,000 Nil

March 24,

4,95,158 10 10 Cash Preferential

allotment (6)

14,95,158 14,951,580 Nil

March 26,

Bonus Issue (7)

76,25,306 76,253,060 Nil

March 30,

2,08,800 10 125 Cash Preferential

allotment (8)

78,34,106 78,341,060 2,40,12,000

May 30,

Bonus Issue (9)

90,09,222 90,092,220 2,40,12,000

1. Initial allotment of 5,000 Equity Shares each to the subscribers to the MoA of our Company being Nitin

Shenoy and Haridas Shenoy.

2. Preferential allotment of 1,000 Equity Shares to Meera Shenoy and 9,000 Equity Shares to Nitin Shenoy.

3. Preferential allotment of 14,400 Equity Shares to Dommic Romell, 1,000 Equity Shares to Kalyani

Godbole, 4000 Equity Shares to Meera Shenoy, 35,600 Equity Shares to Nitin Shenoy and 1,000 Equity

Shares to Ravindra Godbole.

4. Preferential allotment of 5,600 Equity Shares to Dommic Romell, 3,400 Equity Shares to Nitin Shenoy,

5,000 Equity Shares to Ganesh Ramani, 5000 Equity Shares to Isaac Nadar and 5,000 Equity Shares to

Mahesh Chotrani.

5. Our Company vide its Board Resolution dated March 31, 2006, issued 9,00,000 Equity Shares of ` 10 each

as bonus shares to the existing shareholders, as on March 31, 2006 in the ratio of 9 Equity Shares for every

equity share held by them by utilising ` 90,00,000 out of the General Reserves of our Company.

6. Preferential allotment of 1,27,000 Equity Shares to Dominic Romell, 60,000 Equity Shares to Meera

Shenoy and 3,08,158 Equity Shares to Nitin Shenoy.

7. Our Company vide its Board Resolution dated March 24, 2011, issued 61,30,148 Equity Shares of ` 10

each as bonus shares to the existing shareholders, as on March 25, 2011 in the ratio of 4.10 Equity Shares

for every Equity Share held by them by utilising ` 6,13,01,480 out of the General Reserves of our Company.

8. Preferential allotment of 2,08,800 Equity Shares to Quantum EServices Private Limited.

9. Our Company vide its Board Resolution dated May 24, 2011, issued 11,75,116 Equity Shares of ` 10 each

as bonus shares to the existing shareholders, as on May 27, 2011 in the ratio of 0.15 Equity Share for every

Equity Share held by them by utilising ` 1,17,51,160 out of the General Reserves of our Company.

3. Equity Shares issued for consideration other than cash

Save and except as mentioned below, our Company has not issued any Equity Shares for consideration

other than cash:

a. Our Company vide its Board Resolution dated March 31, 2006, issued 9,00,000 Equity Shares of ` 10

each as bonus shares to the existing shareholders, as on March 31, 2006 in the ratio of 9 Equity Shares

for every equity share held by them by utilising ` 90,00,000 out of the General Reserves of our

Company.

b. Our Company vide its Board Resolution dated March 24, 2011, issued 61,30,148 Equity Shares of ` 10

each as bonus shares to the existing shareholders, as on March 25, 2011 in the ratio of 4.10 Equity

Shares for every Equity Share held by them by utilising ` 6,13,01,480 out of the General Reserves of

our Company.

c. Our Company vide its Board Resolution dated May 24, 2011, issued 11,75,116 Equity Shares of ` 10

each as bonus shares to the existing shareholders, as on May 27, 2011 in the ratio of 0.15 Equity Share

for every Equity Share held by them by utilising ` 1,17,51,160 out of the General Reserves of our

Company.

4. Details of Promoters‟ contribution and Lock-in

The Equity Shares held by the Promoters were acquired / allotted in the following manner:

Details of build-up of shareholding of the Promoters and lock-in

Date of Allotment

/ Transfer /

Acquisition

No. of

Equity

Shares

Issue /

Acqui-

sition

Price (`)

Nature

consid-

eration

Nature of Issue % of Pre-

issue paid

up capital

% of Post-

issue paid

up capital

Lock-in

period

Haridas Shenoy (A)

April 28, 2003 5,000 10 10 Cash Initial

Subscription

0.06 0.04 3 years

March 31, 2006 45,000 10 Nil Other than

Bonus Issue 0.50 0.35 3 years

March 26, 2011 2,05,000 10 Nil Other than

May 30, 2011 38,250 10 Nil Other than

Total (A) 2,93,250 3.25 2.25

Nitin Shenoy (B)

April 28, 2003 5,000 10 10 Cash Initial

Subscription

0.06 0.04 -

March 25, 2004 9,000 10 10 Cash Preferential

allotment

0.10 0.07 -

allotment

0.40 0.27 -

allotment

0.04 0.03 -

March 29, 2006 (10,000) 10 10 Cash Transferred to

Sunpreetsingh

(0.11) (0.08) -

Sub-total 43,000 0.48 0.33 3 years

March 24, 2011 3,08,158 10 10 Cash Preferential

allotment

3.42 2.37 1 year

March 26, 2011 17,63,000

10 Nil Other than

cash Bonus Issue

19.57 13.55 3 years

12,63,448 1 year

May 30, 2011 1,15,595

10 Nil Other than

cash Bonus Issue

1.28 0.89 3 years

4,49,096 4.98 3.45 1 year

Total (B) 43,29,297 48.05 33.28

Surabhi Shenoy (C)

January 16, 2011 1,00,000 10 10 Cash Purchased from

Sunpreetsingh

1.11 0.77 1 year

Bonus Issue 4.55 3.15 1 year

May 30, 2011 76,500 10 Nil Other than

Bonus Issue 0.85 0.59 1 year

Total (C) 5,86,500 6.51 4.51

Total (A+B+C) 52,09,047 57.82 40.04

As per clause (a) sub-regulation (1) Regulation 32 of the SEBI ICDR Regulations and in terms of the aforesaid

table, an aggregate of 20% of the post-Issue Equity Share Capital of our Company shall be locked in by our

Promoters for a period of three (3) years from the date of Allotment (“minimum Promoters‟ contribution”).

The Promoter‟s contribution has been brought in to the extent of not less than the specified minimum amount

and has been contributed by the persons defined as Promoter under the SEBI ICDR Regulations. Our Company

has obtained consents from our Promoters for the lock-in of 26,01,845 Equity Shares, held by them, for a period

of three years from the date of Allotment in the Issue. Haridas Shenoy has offered to lock-in his entire

shareholding of 2,93,250 Equity Shares for a period of 3 years, while the balance requirement of 23,08,595

Equity Shares will be locked-in from the eligible Equity Shares held by Nitin Shenoy.

The balance pre-Issue Equity Share capital of our Company, i.e. 64,07,377 Equity Shares shall be locked in for

a period of one year from the date of Allotment in the Issue. Equity Shares offered by the Promoters for the

minimum Promoter‟s contribution are not subject to pledge. Lock-in period shall commence from the date of

Allotment of Equity Shares in the Issue.

We confirm that the minimum Promoters‟ contribution of 20% which is subject to lock-in for three years does

not consist of:

a) equity shares acquired during the preceding three years for consideration other than cash and revaluation of

assets or capitalisation of intangible assets;

b) equity shares acquired during the preceding three years resulting from a bonus issue by utilisation of

revaluation reserves or unrealised profits of the issuer or from bonus issue against equity shares which are

ineligible for minimum Promoters‟ contribution;

c) equity shares acquired by Promoters during the preceding one year at a price lower than the price at which

equity shares are being offered to public in the Issue; or equity shares pledged with any creditor.

The share certificates for the Equity Shares in physical form, which are subject to lock-in, shall carry the

inscription „non-transferable‟ and the non-transferability details shall be informed to the depositories. The

details of lock-in shall be included in the Prospectus to be filed with the RoC.

Further, our Company has not been formed by the conversion of a partnership firm into a company.

5. Equity Shares locked-in for one year

In addition to 20% of the post-Issue shareholding of our Company locked-in for three years as the minimum

Promoters contribution, the balance Pre-Issue Paid-up Equity Share Capital i.e. 64,07,377 Equity Shares, would

be locked-in for a period of one year from the date of Allotment in the proposed Initial Public Offering. Further,

such lock-in of the Equity Shares would be created as per the bye laws of the Depositories. Pursuant to proviso

(b) to Regulation 37 of the SEBI ICDR Regulations, Equity Shares held by VCFs or FVCIs for at least one year

prior to filing of the Draft Red Herring Prospectus with SEBI would not be subject to the above lock-in.

6. Other requirements in respect of „lock-in‟

In terms of Regulation 40 of the SEBI ICDR Regulations, the Equity Shares held by persons other than the

Promoters prior to the Issue may be transferred to any other person holding the Equity Shares which are locked-

in as per Regulation 37 of the SEBI ICDR Regulations, subject to continuation of the lock-in in the hands of the

transferees for the remaining period and compliance with the Takeover Code as applicable.

In terms of Regulation 40 of the SEBI ICDR Regulations, the Equity Shares held by our Promoters which are

locked in as per the provisions of Regulation 36 of the SEBI ICDR Regulations, may be transferred to and

amongst Promoters / members of the Promoter Group or to a new promoter or persons in control of our

Company, subject to continuation of lock-in in the hands of transferees for the remaining period and compliance

of Takeover Code, as applicable.

In terms of Regulation 39 of the SEBI ICDR Regulations, the locked-in Equity Shares held by our Promoters

can be pledged only with any scheduled commercial banks or public financial institutions as collateral security

for loans granted by such banks or financial institutions, subject to the following:

If the specified securities are locked-in in terms of sub-regulation (a) of Regulation 36 of the SEBI ICDR

Regulations, the loan has been granted by such bank or institution for the purpose of financing one or more

of the objects of the issue and the pledge of specified securities is one of the terms of sanction of the loan;

If the specified securities are locked-in in terms of sub-regulation (b) of Regulation 36 of the SEBI ICDR

Regulations and the pledge of specified securities is one of the terms of sanction of the loan.

7. Our shareholding pattern

The table below represents the shareholding pattern of our Company, before and after the proposed Issue:

Pre-Issue Post-Issue

Category of shareholder

No. of

holders

number of

shares

Number

shares

held in

demater

ialised

shareholding as

a percentage of

total number of

shares

No. of

holders

number of

shares

Number of

shares held in

dematerialised

shareholding as

a percentage of

total number of

shares

percen

tage of

percenta

(A+B+C

percen

tage of

percenta

(A+B+C)

(A) Promoter and Promoter

(1) Indian

(a) Individuals/ Hindu Undivided

Family

6 59,71,497 Nil 66.28 66.28 6 59,71,497 - 45.90 45.90

(b) Central Government/ State

Government(s)

- - - - - - - - - -

(c) Bodies Corporate - - - - - - - - - -

(d) Financial Institutions/ Banks - - - - - - - - - -

(e) Any Other (specify) - - - - - - - - - -

(f) Immediate relatives - - - - - - - - - -

Sub-Total (A)(1) 6 59,71,497 Nil 66.28 66.28 6 59,71,497 - 45.90 45.90

(2) Foreign

Individuals (Non-Resident

Individuals/ Foreign Individuals)

- - - - - - - - - -

(b) Bodies Corporate - - - - - - - - - -

(c) Institutions - - - - - - - - - -

(d) Any Other (specify) - - - - - - - - - -

Sub-Total (A)(2) - - - - - - - - - -

Total Shareholding of

Promoter and Promoter

Group (A)= (A)(1)+(A)(2)

6 59,71,497 Nil 66.28 66.28 6 59,71,497 - 45.90 45.90

(B) Public shareholding

(1) Institutions

(a) Mutual Funds/UTI - - - - - [●] [●] [●] [●] [●] (b) Financial Institutions/ Banks - - - - - [●] [●] [●] [●] [●]

(c) Central Government/ State

Government(s)

- - - - - [●] [●] [●] [●] [●]

(d) Venture Capital Funds - - - - - [●] [●] [●] [●] [●] (e) Insurance Companies - - - - - [●] [●] [●] [●] [●] (f) Foreign Institutional Investors - - - - - [●] [●] [●] [●] [●]

(g) Foreign Venture Capital Investors

- - - - - [●] [●] [●] [●] [●]

(h) Any Other (specify) - - - - - [●] [●] [●] [●] [●] Sub-Total (B)(1) - - - - - [●] [●] [●] [●] [●]

(2) Non-institutions - - - - - [●] [●] [●] [●] [●]

(a) Bodies Corporate 1 2,40,120 Nil 2.67 2.67 [●] [●] [●] [●] [●]

Individuals –

i. Individual shareholders

holding nominal share

capital up to ` 1 lacs

- - - - - [●] [●] [●] [●] [●]

Pre-Issue Post-Issue

Category of shareholder

No. of

holders

number of

shares

Number

shares

held in

demater

ialised

shareholding as

a percentage of

total number of

shares

No. of

holders

number of

shares

Number of

shares held in

dematerialised

shareholding as

a percentage of

total number of

shares

percen

tage of

percenta

(A+B+C

percen

tage of

percenta

(A+B+C)

ii. Individual shareholders

holding nominal share

capital in excess of ` 1

4 27,97,605 Nil 31.05 31.05 [●] [●] [●] [●] [●]

(c) Any Other (specify) - - - - - [●] [●] [●] [●] [●]

Non-Resident Indians - - - - [●] [●] [●] [●] [●]

Directors & their Relatives - - - - - [●] [●] [●] [●] [●]

Sub-Total (B)(2) 5 30,37,725 Nil 33.72 33.72 [●] [●] [●] [●] [●]

Total Public Shareholding

(B)= (B)(1)+(B)(2)

5 30,37,725 Nil 33.72 33.72 [●] 70,37,725 [●] 54.10 54.10

TOTAL (A)+(B) 11 90,09,222 Nil 100.00 100.00 [●] 1,30,09,222 [●] 100.00 100.00

Shares held by Custodians

and against which

Depository Receipts have

been issued

- - - - - - - - - -

GRAND TOTAL

(A)+(B)+(C) 11 90,09,222 Nil 100.00 100.00 [●] 1,30,09,222 [●] 100.00 100.00

Note: This is based on the assumption that the existing shareholders, shall continue to hold the same number of

Equity Shares after the Issue. This does not include any Equity Shares that shareholders (excluding Promoters)

may subscribe for and be Allotted pursuant to this Issue.

8. The details of the shareholding of the Promoters and the Promoter Group as on the date of the Draft Red

Herring Prospectus:

(Equity Shares of Face Value of ` 10 each)

Name of the Shareholders Number of

Equity Shares

Percentage of

Pre-Issue Equity

Capital

Percentage of

Post – Issue

Equity Capital

(A) Promoters

Haridas Shenoy 2,93,250 3.25 2.25

Nitin Shenoy 43,29,297 48.05 33.28 Surabhi Shenoy 5,86,500 6.51 4.51 Total (A) 52,09,047 57.82 40.04

Promoter Group

Meera Shenoy 6,45,150 7.16 4.96

Ravindra Godbole 58,650 0.65 0.45

Kalyani Godbole 58,650 0.65 0.45

Total (B) 7,62,450 8.46 5.86

Total (A) + (B) 59,71,497 66.28 45.90

9. Particulars of the top ten shareholders

(a) Particulars of the top ten shareholders as on the date of the Draft Red Herring Prospectus with SEBI.

Sr. No. Name of Shareholders Number of Equity

Shares

Percentage of Total

Paid-Up Capital

1. Nitin Shenoy 43,29,297 48.05

2. Domnic Romell 19,17,855 21.29

3. Meera Shenoy 6,45,150 7.16

4. Surabhi Shenoy 5,86,500 6.51

5. Haridas Shenoy 2,93,250 3.25

6. Mahesh Chotrani 2,93,250 3.25

Shares

Percentage of Total

Paid-Up Capital

7. Ganesh Ramani 2,93,250 3.25

8. Isaac Nadar 2,93,250 3.25

9. Quantum Eservices Private Limited 2,40,120 2.67

10. Ravindra Godbole 58,650 0.65

Kalyani Godbole 58,650 0.65

TOTAL 90,09,222 100.00

(b) Particulars of top ten shareholders ten days prior to the date of the Draft Red Herring Prospectus with

Shares

Percentage of Total

Paid-Up Capital

1. Nitin Shenoy 43,29,297 48.05

2. Domnic Romell 19,17,855 21.29

3. Meera Shenoy 6,45,150 7.16

5. Haridas Shenoy 2,93,250 3.25

8. Isaac Nadar 2,93,250 3.25

9. Quantum Eservices Private Limited 2,40,120 2.67

Kalyani Godbole 58,650 0.65

TOTAL 90,09,222 100.00

(c) Particulars of the top ten shareholders two years prior to the date of the Draft Red Herring Prospectus with

Shares

Percentage of Total

Paid-Up Capital

1. Nitin Shenoy 4,30,000 43.00

2. Domnic Romell 2,00,000 20.00

3. Sunpreet Singh 1,00,000 10.00

4. Haridas Shenoy 50,000 5.00

5. Meera Shenoy 50,000 5.00

6. Mahesh Chotrani 50,000 5.00

7. Ganesh Ramani 50,000 5.00

8. Isaac Nadar 50,000 5.00

10. Kalyani Godbole 10,000 1.00

Total 10,00,000 100.00

1. None of our Directors or Key Managerial Personnel hold Equity Shares in our Company, other than as

follows:

Sr. No. Name of shareholder Number of Equity

Shares held

Pre Issue

Percentage

Post Issue

Percentage

Directors

a. Nitin Shenoy 43,29,297 48.05 33.28

b. Surabhi Shenoy 5,86,500 6.51 4.51

Key Managerial Personnel

c. Mahesh Chotrani 2,93,250 3.25 2.25 d. Ganesh Ramani 2,93,250 3.25 2.25 e. Isaac Nadar 2,93,250 3.25 2.25

10. Our Promoters, our Promoter Group, the Directors of our Company and their immediate relatives, as

defined under the SEBI ICDR Regulations, have not purchased or financed the purchase by any other

person, or sold any Equity Shares, during a period of six months preceding the date of filing the Draft Red

Herring Prospectus with SEBI, except as mentioned below:

Name of the

transferee

Name of the

transferor

No. of Equity

Shares

Transfer price per

Equity Share (`)

Date of transfer

Surabhi Shenoy Sunpreetsingh Arora 1,00,000 10 January 16, 2011

11. Our Company, our Promoters, our Directors and the BRLM have not entered into any buy back, standby or

similar arrangements for the purchase of Equity Shares from any person.

12. Neither the BRLM, nor their associates hold any Equity Shares of our Company as on the date of the Draft

13. For the details of transactions by our Company with our Promoter Group, Group Companies during the last

five Fiscals i.e. 2007, 2008, 2009, 2010 and 2011, please refer to paragraph titled “Statement of

Transactions with Related Parties, as Restated” in the chapter titled „Financial Information‟ beginning on

of the Draft Red Herring Prospectus

14. As on the date of the Draft Red Herring Prospectus with the Registrar of Companies there are no

outstanding Warrants, options or rights to convert debentures, loans or other financial instrument into

Equity Shares.

15. As per RBI regulations, OCBs are not allowed to participate in this Issue.

16. All the Equity Shares of our Company are fully paid up as on the date of the Draft Red Herring Prospectus.

Further, since the entire money in respect of the Issue is being called on application, all the successful

applicants will be issued fully paid-up equity shares.

17. In terms of Rule 19(2)(b)(i) of the SCRR, this Issue is for 25% of the post-Issue capital of our Company.

Pursuant to the SEBI ICDR Regulations not more than 50% of the Issue shall be available for allocation to

QIBs. If the minimum public shareholding requirements of Rule 19(2)(b)(i) of the SCRR cannot be met, the

entire application money will be refunded by our Company forthwith.

18. Under subscription, if any, in any category, shall be met with spill-over from any other category or

combination of categories at the discretion of our Company, in consultation with the BRLM and the

Designated Stock Exchange.

19. Oversubscription, if any, to the extent of 10% of the Issue, can be retained for the purpose of rounding off

and making allotments in minimum lots, while finalising the „Basis of Allotment‟. Consequently, the

Allotment may increase by a maximum of 10% of the Issue, as a result of which the post-Issue paid-up

capital would also increase by the excess amount of Allotment so made. In such an event, the Equity Shares

to be locked-in towards the Promoter‟s Contribution shall be suitably increased, so as to ensure that 20% of

the post-Issue paid-up capital is locked in.

20. The total number of members of our Company as on the date of the Draft Red Herring Prospectus is eleven.

21. Our Company has not raised any bridge loan against the proceeds of this Issue.

22. There will be no further issue of capital, whether by way of issue of bonus shares, preferential allotment,

rights issue or in any other manner during the period commencing from the date of the Draft Red Herring

Prospectus with SEBI until the Equity Shares have been listed. Further, our Company presently does not

have any intention or proposal to alter our capital structure for a period of six months from the date of

opening of this Issue, by way of split / consolidation of the denomination of Equity Shares or further issue

of Equity Shares (including issue of securities convertible into exchangeable, directly or indirectly, for our

Equity Shares) whether preferential or otherwise, except that if we enter into acquisition(s) or joint

venture(s), we may consider additional capital to fund such activities or to use Equity Shares as a currency

for acquisition or participation in such joint ventures.

23. There shall be only one denomination of Equity Shares, unless otherwise permitted by law.

24. We shall comply with such disclosure and accounting norms as may be specified by SEBI from time to

25. An investor cannot make a Bid for more than the number of Equity Shares offered through the Issue,

subject to the maximum limit of investment prescribed under relevant laws applicable to each category of

investor.

26. Our Company has not revalued its assets since its incorporation and has not issued any Equity Shares out of

revaluation reserves.

27. Our Company has not made any public issue since its incorporation.

28. The shares locked in by our Promoters are not pledged to any party.

29. No payment, direct or indirect in the nature of discount, commission, and allowance or otherwise shall be

made either by us or our Promoters or Directors to the persons who receive allotments, if any, in this Issue.

30. Our Company does not have any Employee Stock Option Scheme / Employee Stock Purchase Scheme for

our employees.

31. Our Promoters and the members of our Promoter Group will not participate in this Issue.

32. There has been no allotment of Equity Shares that may be at a price lower than the Issue Price within the

last 12 months from the date of the Draft Red Herring Prospectus except as under:

Date of

Allotment

Nature of

Allotment

Name of Allottee No. of

Equity

Shares

Equity

Nature of

consideration

March 24,

Preferential

Nitin Shenoy 3,08,158 10 10 Cash

Domnic Romell 1,27,000

Meera Shenoy 60,000

March 26,

Nitin Shenoy 30,26,448 10 Nil Other than

cash Domnic Romell 13,40,700

Meera Shenoy 4,51,000

Surabhi Shenoy 2,05,000

Haridas Shenoy 2,05,000

Mahesh Chotrani 2,05,000

Ganesh Ramani 2,05,000

Isaac Nadar 2,05,000

Ravindra Godbole 41,000

Kalyani Godbole 41,000

March 30,

Preferential

Quantum Eservices

Private Limited

2,08,800 10 125 Cash

May 30,

Nitin Shenoy 5,64,691 10 Nil Other than

cash Domnic Romell 2,50,155

Meera Shenoy 84,150

Surabhi Shenoy 76,500

Haridas Shenoy 38,250

Mahesh Chotrani 38,250

Ganesh Ramani 38,250

Isaac Nadar 38,250

Quantum Eservices

Private Limited

31,320

Ravindra Godbole 7,650

Kalyani Godbole 7,650

33. The Company shall ensure that transactions in the Equity Shares by the Promoters and the Promoter Group

between the date of registering the Red Herring Prospectus with the RoC and the Bid/Issue Closing Date

shall be reported to the Stock Exchanges within twenty-four hours of such transactions.

OBJECTS OF THE ISSUE

The objects of the Issue are:

1. To set up a Software Development Center at Thane

2. To finance the funds required for our potential acquisitions

3. Additional Working Capital requirements

4. General Corporate Purposes

5. Meeting public Issue expenses

The other Objects of the Issue also include creating a public trading market for the Equity Shares of our

Company by listing them on BSE and NSE. We believe that the listing of our Equity Shares will enhance our

visibility and brand name and enable us to avail of future growth opportunities.

The main object clause of Memorandum of Association of our Company enables us to undertake the existing

activities and the activities for which the funds are being raised by us through the present Issue. Further, we

confirm that the activities which we have been carrying out till date are in accordance with the object clause of

our Memorandum of Association.

Cost of Project & Means of Finance

The Cost of Project and Means of Finance as estimated by our management are given below:

Cost of Project

(` in Lacs)

Sr. No. Particulars Amount

A. To set up a Software Development Center at Thane 2,032.23

B. Proposed acquisitions 1,500.00

C. Additional Working Capital requirements 1,000.00

D. Public Issue Expenses [●]

E. General Corporate Purposes [●]

Total [●]

Means of Finance

(` in Lacs)

Sr. No. Particulars Amount

A. Proceeds from Initial Public Offer [●]

Total [●]

The entire requirements of the objects detailed above are intended to be funded from the Issue Proceeds.

Accordingly, we confirm that there is no requirement for us to make firm arrangements of finance through

verifiable means towards at least 75% of the stated means of finance, excluding the amount to be raised through

the Issue.

In case the IPO does not go as planned, our Company will make alternative arrangements like availing of fresh

loans from bank(s) and/or utilizing internal accruals. In case of excess funds remaining after deployment as per

the Objects of the Issue, the same will be utilized for General Corporate Purposes, as detailed in the chapter

titled “Objects of the Issue” beginning on page 27 of the Draft Red Herring Prospectus.

The fund requirement and deployment are based on internal management estimates and quotations received

from the third parties, and have not been appraised by any bank or financial institution or any independent

organization. Our plans are subject to a number of variables, including possible cost overruns; receipt of critical

governmental approvals; and changes in management‟s views of the desirability of current plans, among others.

In case of any variations in the actual utilization of funds earmarked for the above activities, increased fund

deployment for a particular activity may be financed by surplus funds, if any available in any other project for

which funds are being raised in the Issue. If surplus funds are unavailable, the required financing will be through

internal accruals, and/ or the term loans/working capital loans that may be availed from the Banks/ Financial

Institutions, as required.

Brief Details about the Project

(A) Setting up of Software development Center at Thane

With increasing opportunities for companies like ours, it is imperative for us to maintain a cost advantage over

the bigger players in this sector. In this effort, our Company intends to set up a Software Development Center at

Thane, Maharashtra, located at a distance of about 36 kms from Mumbai. The proposed facility shall be well

connected through Company provided transportation, as is the case with most IT companies.

The proposed facility shall be a Ground+6 storied structure, which shall have a capacity to house approx 400

employees, and shall house our entire business operations.

Sr. No. Particulars ` in Lacs

1. Land 430.52

2. Land development, Building, civil and electrical works 634.40

3. Interior 387.00

4. Office Equipment 595.55

Total 2047.47

Land details

Our Company proposes to purchase a plot of land admeasuring approximately 1,000 sq.mts at Thane to

construct a building for its new software development facility. We have received a quotation from M/s. Sweet

Home, Real Estate Agents, dated March 28, 2011 detailing that the rate at which land is available in Thane is @

` 4,000/- per sq.ft in and around Thane Industrial Estate. We estimate that the land (approximately measuring

1,000 sq.mts) would cost us ` 430.52 lacs with a permissible built-up area of 21,528 sq.ft.

Building and civil construction and electrical works

The building plan is for a G+6 storied structure with cost as detailed hereunder:

Sr. No. Details Unit Qty. Rate Amount (` in

A SUBSTRUCTURE

Excavation Cft 1,83,664.00 8.50 15.61

Backfilling with available earth Cft 5,298.00 2.50 0.13

Backfilling with earth bought from outside Cft 7,346.00 9.50 0.70

Portland Cement Concrete (1:4:8) Cft 2,296.00 95.00 2.18

Masonry Works for Sump Cft 225.00 70.00 0.16

Reinforced Cement Concrete Cft 6,063.14 195.00 11.82

Finishing Plaster Sft 198.00 25.00 0.05

SUB - TOTAL (A ) 30.65

B BASEMENT FLOOR

Portland Cement Concrete (1:4:8) Cft 2,296.50 90.00 2.07

RCC (1:2:4) for Retaining wall, Lift Shaft, Cft 4,468.70 195.00 8.71

Column, Beam, Roof, Shear Wall-Lift &

Stairs,

Ramp & Stairs Cft 1,340.70 175.00 2.35

Finished

Plastering Sft 17,491.00 20.00 3.50

Flooring Sft 6,996.00 40.00 2.80

Painting Sft 18,000.00 12.00 2.16

Doors Sft 95.00 850.00 0.81

SUB - TOTAL (B ) 22.39

C GROUND FLOOR

RCC (1:2:4) for Column, Beam Roof, Stair, Cft 3,814.00 195.00 7.44

Lintels, Shear Wall of Lift & Stairs

C.B. Masonry Sft 482.00 70.00 0.34

Finishing Sft 17,222.00 18.20 3.13

Flooring for Main Hall, Stairs, Skirting Sft/Rft 4,305.60 180.00 7.75

Ceramic Glazed tiles for Toilets & Kitchenette 430.00 145.00 0.62

Ceramic Glazed tiles for Toilets &

Kitchenette (Non Skid) 1,550.00 155.00 2.40

Painting Sft 10,764.00 12.00 1.29

Door, Revolving door around the Main

entrance

Sft 36.00 3,50,00.00 12.60

Other Doors Sft 140.00 850.00 1.19

Curtain Walls Sft 1,250.00 1,600.00 20.00

Toilet Cubicles Nos 4.00 30,000.00 1.20

Urinals Nos 2.00 5,000.00 0.10

SUB - TOTAL (C ) 58.07

D FIRST FLOOR

RCC (1:2:4) for Column, Beam, Roof, Stairs, Cft 3,814.00 190.00 7.25

Lintels, Shear wall of Lift & Stairs

C.B. Masonry Sft 482.00 70.00 0.34

Finishing Sft 17,222.00 20.00 3.44

Flooring for Main Hall, Stairs, Skirting Sft/Rft 4,305.60 180.00 7.75

Ceramic Glazed tiles for Toilets & Kitchenette 430.00 145.00 0.62

Ceramic Glazed tiles for Toilets & Kitchenette

(Non Skid) 1,430.00 155.00 2.22

Painting Sft 10,764.00 12.00 1.29

Doors Sft 140.00 850.00 1.19

Curtain Walls Sft 1,250.00 1,600.00 20.00

Toilet Cubicles Nos 4.00 30,000.00 1.20

Urinals Nos 2.00 5,000.00 0.10

SUB - TOTAL (D) 45.40

E SECOND FLOOR

Masonry works Sft 482.00 70.00 0.34

Finishing Sft 17,222.00 20.00 3.44

Granite flooring for Main Hall, Stairs,

skirting

Sft/Rft 4,305.60 180.00 7.75

Kitchenette

430.00 145.00 0.62

Kitchenette

(Non Skid) 1,430.00 155.00 2.22

Painting Sft 10,764.00 12.00 1.29

Doors Sft 140.00 850.00 1.19

Curtain Walls Glazed with Spider Glazing Sft 1,250.00 1,600.00 20.00

Toilet cubicles Nos 4.00 30,000.00 1.20

Urinals Nos 2.00 5,000.00 0.10

SUB - TOTAL (E) 45.59

F THIRD FLOOR

Finishing Sft 17,222.00 20.00 3.44

skirting

Sft/Rft 4,305.60 180.00 7.75

Kitchenette

430.00 145.00 0.62

Kitchenette

(Non Skid) 1,430.00 155.00 2.22

Painting Sft 10,764.00 12.00 1.29

Doors Sf 140.00 850.00 1.19

Curtain Walls Glazed with Spider Glazing Sft 1,250.00 1,600.00 20.00

Urinals Nos 2.00 5,000.00 0.10

SUB - TOTAL (F) 45.59

G FOURTH FLOOR (similar to third floor) 45.59

H FIFTH FLOOR (similar to third floor) 45.59

I SIXTH FLOOR (similar to third floor) 45.59

J TERRACE FLOOR

Finishing Sft 8,050.00 20.00 1.61

skirting

Sft/Rft 1,250.00 180.00 2.25

Kitchenette

430.00 145.00 0.62

Kitchenette

(Non Skid) 1,430.00 155.00 2.22

Painting Sft 9,750.00 12.00 1.17

Doors Sft 80.00 850.00 0.68

Curtain Walls Glazed with Spider Glazing Sft 850.00 1,600.00 13.60

Urinals Nos 2.00 5,000.00 0.10

SUB - TOTAL (J) 27.88

K OTHER MISCELLANEIOUS

a) Stone Cladding Sft 455.00 150.00 0.68

b) Steel Roofing Sft 2,850.00 450.00 12.83

c) S. S. Railing Sft 225.00 350.00 0.79

d) Water proofing Sft 4,305.60 80.00 3.44

e) Landscaping for roof garden & Gr. Floor Sft 2,600.00 450.00 11.70

f) Site Development for Gr. Floor Sft 3,767.00 120.00 4.52

g) Structural Steel MT 39.48 52,000.00 20.53

TOTAL MISCELLANEOUS (K) 54.49

L MECHANICAL SYSTEM

a) Lifts 50.00

b) Plumbing & Sanitary works 25.50

c) Air Conditioning System 31.01

d) Fire Fighting System 12.50

SUB - TOTAL (L) 69.01

M ELECTRICAL & SECURITY SYSTEMS

a) Lighting System 12.50

b) Power D.G. etc. 12.50

c) Telephone & Networking 16.20

d) UPS, Fire-alarm, Generator & Security

System

SUB - TOTAL (M) 50.20

DIRECT COST FOR BUILDING 586.05

N OTHER INDIRECT COSTS

Consultancy @ 4% of the above 23.44

Sanctioning & Approvals @ 1.75% 10.26

Contingencies & Misc expenses @ 2.50% 14.65

SUB-TOTAL (N) 48.35

O INTERIOR FITOUTS

Cost of Fit-outs Sft 21,500.00 1,800.00 387.00

TOTAL BUILDING COSTS 1,021.40

The above estimates are based on quotation provided by Girish Chaudhari, Architect & Government Approved

Valuers, vide their letter dated June 15, 2011.

Details of Office Equipment, including computers and servers, for which quotations have been received,

but orders not placed are as under:

Sr. No. Particular Price Per

Unit (In `)

Quantity Amount (` in

1 Dell PowerEdge M910 Blade Server 32GBMemory

(8X4GB), 1066 MHz, Dual Ranked LV RDIMMs for 2 or

4 Processors 2x Intel Xenon E7-2870 2.40 GHz, 30M

cache 6.4 GT/s QPL, Turbo, HT, 10C, 1066MHz Max

Mem500GB 7.2 K RPM Near Line SAS 2.5 in Hot Plug

Hard drive window server 2008 R2, Enterprise Edition

8,02,260 10 80.23

2 Dell XPS 9000

Processor Intel Core i7920 Processor (2,66 GHz, 8MB L3

Cache) RAM 6 GB Hard Disk: 1TB/1024GB Display LCD

Size: 21.5” inch Dell S2209W LCD monitor, Video

graphics card: ATI Radeon HD 4350 graphics, Sound

blaster X-Fi audio, Std keyboard, optical mouse

80,000 300 240.00

3 Win Pro 7 SNGL OLP NL Legalization Get Genuine 12,000 300 36.00

4 Desktop Projector VPL-DX15 Window Vista Network

Projector High Picture Quality and Bright Images Off &

Go Short Projection Distance Lens Shutter Variety of

Network function- via LAN or WALN

1,09,900 2 2.20

5 Microsoft Visio 2010 45,000 100 45.00

6 Microsoft Project Server 2010 3,32,100 1 3.32

7 Microsoft Exchange Server 2010 1,80,000 1 1.80

8 Microsoft Exchange Server 2010 standard CAL 3,015 300 9.05

Sr. No. Particular Price Per

Unit (In `)

Quantity Amount (` in

9 Microsoft Sharepoint Server 2,48,000 1 2.48

10 Visual Studio 2010 Enterprise Edition 1,70,955 50 85.48

11 Microsoft Project 2010 45,000 100 45.00

12 Microsoft Office 2010 Professional Edition 22,500 200 45.00

Total 595.55

The above estimates are based on the quotation provided by Nexus Computers Private Limited, vide their

quotation dated June 11, 2011.

We confirm that none of the above equipments are second hand in nature.

Note: The actual suppliers of above-mentioned equipment may differ while negotiating the prices for the

respective equipment. Further, the specification of equipment may also differ considering the conditions

prevailing at the time of placing the orders.

(B) Proposed Acquisitions

Our Company intends to raise funds for proposed Acquisitions. It is a key component of our strategy to grow

through acquisitions and strategic partnerships. The acquisition will be by way of acquiring the equity of the

target or in any other manner as may be deemed feasible. These initiatives will be governed by medium to long

term goals and other business objectives. Accordingly, we intend to earmark and use a substantial part of the

Issue proceeds (` 1,500 lacs) for strategic investments and acquisitions.

We believe current valuations are moderate and thus it is a favorable situation for companies like ours, which

may be able to get a better foothold in US, Middle East and other countries including India at relatively fair

valuations. While we would always strive to get the best possible deal at the lowest valuations, we cannot assure

that this situation shall prevail over the next 12 months, which is the timeframe we are looking at for closing the

acquisition.

Going forward, we believe that strategic investments and acquisitions may act as an enabler to growing

business. While this would be a component of our strategy, presently we do not have any legally binding

commitments to enter into any such arrangements.

The business we are currently in is highly competitive and very dynamic. The technology advancements are

almost a daily feature across the globe. The key to this dynamism is innovation in software and a major part of

the software innovation is commonly initiated by the end users, rather than due to software innovation. In such a

situation, the investment in the next generation of technology or framework begins when the previous

technology solution is at its peak. We are confident that we can build these capabilities in an inorganic way by

acquiring Companies / Businesses / Products, rather than in an organically slow and steady manner.

We intend to acquire Companies/Businesses/products which have the synergy and are complementary to our

technology domain. Primarily, we would target acquisition of companies /Businesses/products in the Healthcare

and or/transport logistics segment. Any specific acquisition opportunity will be considered based on actual value

estimates at that time.

Following are the major benefits we intend to derive from the acquisitions:

1. Endeavour to be a complete solutions provider:

Currently we cater to different verticals and our products and services undergo evolution as per the customers‟

requirements from time to time. In our effort we have received queries from our existing clients as well as new

customers to provide certain services or extension/modification of certain products and services, which we do

not provide currently.

In this endeavour, we are targeting to acquire companies which shall match with our products and services and

help us reach the next level in the value chain. There are always certain missing links, which the customers

demand, and having identified those, we plan to target companies, which would fit into that role.

2. New technologies

Our proposed acquisition shall help us to be conversant with technologies that our employees have not worked

on or are not very conversant with. This in turn shall help our existing team members to service our clients in a

more efficient and effective manner, with updated knowledge of new technologies/products/services.

3. Localized knowledge of employees of the target company

Our proposed acquisition shall also help us to have a more localized knowledge about the requirements of the

clients. This shall reduce the time for our team to get acclimatized to that particular geographical location.

4. Enhancing our geographical reach

Currently our Company is operating primarily in US, India and the Middle East. One of our strategies is to

expand our business reach to countries and regions where we do not have presence, or entrench deeply with the

proposed acquisitions. In this context, we may possibly look to acquire a company which has a geographical

presence, which is diverse from our current presence, but not necessarily so.

5. Sizeable presence to support our existing clients and addition of new clients

The proposed acquisition shall also help us with critical mass for taking our business operations to a next level.

The proposed acquisition shall help us scale up the employee headcount and reduce our risk of being dependant

on only a few key employees. Other obvious benefit includes addition of the target company‟s client list, where

we can effectively leverage our relationship and offer our existing products to them without incurring the

overheads usually required to service a first-instance client

As of the date of this Draft Red Herring Prospectus, we have not entered in to any letter of intent or definitive

commitment for such acquisition/investment for which the funds are being raised. However, we would follow

the below mentioned acquisition strategy for inorganic growth and the same would be consistently followed

under the supervision of the Board of Directors. The broad practices which we intend to follow for potential

acquisition are as under:

(a) Identifying the target company

(b) Entering into a Non-Disclosure Agreement with the Target Company

(c) A preliminary analysis: Our Company goes through the information pertaining to the Target company,

which is confidential and it includes its financials and information about its clientele

(d) Broader terms of valuation are agreed upon subject to due-diligence. On the basis of this our Company

enters into a Memorandum of Understanding (MOU) with the target Company and then starts the formal

due-diligence, which may need hiring specialists and outside agency

(e) On satisfactory conclusion of due diligence our company enters into definitive „purchase agreement‟ with

the target company and the legal formalities are complied.

Based on the above considerations, there are acquisition opportunities available where we can acquire a

controlling/majority stake for ` 1,500 Lacs. Our Company would follow the above modalities for any

acquisitions out of the Issue Proceeds and have envisaged a requirement of upto ` 1,500 Lacs for the proposed

acquisitions. The proceeds of the Issue allocated towards acquisitions may not be the total value of the

acquisition, but may provide us with leverage to enter into binding agreements.

(C) Additional Working Capital requirements

As on date of the Draft Red Herring Prospectus we do not have any working capital limits sanctioned. Till date

our internal accruals are adequate to meet our existing requirements. However, our Company will utilize a part

of the proceeds of the Issue to fund additional future working capital requirements.

Considering the existing growth rate and the proposed expansion, the total working capital needs of our

Company, as assessed based on the internal working of our Company is expected to reach ` 1,707.72 lacs by

fiscal 2013 out of which we propose to fund ` 1,000.00 lacs through this Public Issue, details of which are

mentioned hereunder:

Particulars No. of

Working

Capital

Requirement

FY 2011

(` in lacs)

Working

Capital

Requirement

FY 2012

(` in lacs)

Working

Capital

Requirement

FY 2013

(` in lacs)

(Actual) (Projected) (Projected)

Current Assets

Sundry Debtors 90.28 866.33 120 2,268.49 3,550.68

Other Current Assets 9.69 92.97 30 567.12 887.67

Total Current Assets 959.30 2,835.62 4,438.36

Current Liabilities

Sundry Creditors 79.00 620.79 90 1,261.96 1,935.57

Other Liabilities -- 0.00 90 133.24 284.07

Provisions -- 127.24 -- 316.50 511.00

Total Current Liabilities 748.03 1,711.70 2,730.64

Working Capital Gap 211.27 1,123.91 1,707.72

Less: Existing Bank Borrowings 0.00 0.00 0.00

Net Working Capital Requirement 211.27 1,123.91 1,707.72

Proposed Working Capital to be

funded from IPO

0 0 1,000.00

Funding through Own Funds and/or

Borrowings

211.27 1,123.91 707.72

(D) Public Issue Expenses

The expenses of this Issue include, among others, underwriting and management fees, selling commission,

printing and distribution expenses, legal fees, advertising expenses and listing fees. The estimated Issue

expenses are as follows:

(` in lacs)

Activity Estimated

expenses*

percentage of

the total

estimated Issue

expenses*

percentage of

the total Issue

Fees payable to the Book Running Lead Manager [] [] []

Advertising and marketing expenses [] [] []

Fees payable to the Registrar to the Issue [] [] [] Fees payable to the Bankers to the Issue [] [] [] Underwriting commission, brokerage and selling

commission [] [] []

SCSB commission [] [] []

IPO Grading expense [] [] []

Others (legal fees, listing fees, monitoring agency

fees, printing and stationery expenses, distribution

expenses etc.)

[] [] []

Total estimated Issue expenses [] [] [] *Will be incorporated at the time of filing of the Prospectus.

(E) General Corporate Purposes

Our Company intends to deploy the balance of the Proceeds of the Issue aggregating ` [●] Lacs, towards general

corporate purposes, including but not restricted to strategic initiatives, organic growth opportunities

strengthening of our marketing capabilities, brand building exercises meeting exigencies and contingencies

which our Company in the ordinary course of business may not foresee, or any other purposes as approved by

our Board of Directors.

Our management, in accordance with the policies of our Board, will have flexibility in utilizing the proceeds

earmarked for general corporate purposes.

Our management, in response to the dynamic nature of the industry, will have the discretion to revise its

business plan from time to time and consequently our funding requirement and deployment of funds may also

change. This may also include rescheduling the proposed utilization of Proceeds and increasing or decreasing

expenditure for a particular object vis-à-vis the utilization of Proceeds. In case of a shortfall in the Proceeds of

the Issue, our management may explore a range of options which include utilisation of our internal accruals

and/or seeking debt from future lenders. Our management expects that such alternate arrangements would be

available to fund any such shortfall. Our management, in accordance with the policies of our Board, will have

flexibility in utilizing the proceeds earmarked for general corporate purposes.

Schedule of implementation

Particulars

Month of Commencement Month of Completion

Setting up of Software Development centre Feb 2012 July 2013

Proposed Acquisitions Feb 2012 July 2012

Deployment of Funds in the Project

We have incurred the following expenditure on the project till July 1, 2011. The same has been certified by our

statutory auditors M/s. Gopal Rao & Associates, Chartered Accountants vide their certificate dated July 2, 2011.

Sr. No Particulars Amount deployed

(` Lacs)

(a) Public Issue expenses 13.18

Total 13.18

The above mentioned deployment has been financed by way of internal accruals.

Details of balance fund deployment

(` in Lacs)

Particulars Expenses

incurred till

July 1, 2011

FY 2012 FY 2013 FY 2014 Total

Setting up of Software

Development centre

- 150.00 550.00 1,332.23 2,032.23

Proposed Acquisitions - - 1,500.00 - 1,500.00

Additional Working Capital

requirements

- - 1,000.00 - 1,000.00

Public Issue Expenses 13.18 [●] - - [●] General Corporate Purposes - [●] - - [●] Total 13.18 [●] 3,050.00 1,332.23 [●]

Appraisal Report

None of the projects for which the Net Proceeds will be utilised have been financially appraised by any financial

institutions/banks.

Interim Use of Funds

The management, in accordance with the approval of the Board of Directors, will have the flexibility in

deploying the Issue Proceeds received by us. Pending utilization for the purposes described above, we intend to

invest the funds in high quality interest/dividend bearing liquid instruments including money market mutual

funds and deposits with banks for the necessary duration or for reducing overdraft.

Monitoring of Issue proceeds

Our Audit Committee will also monitor the utilization of the Issue Proceeds. We will disclose the utilization of

the Issue proceeds under separate head in our balance sheet for the Financial Year 2012, 2013 and 2014.

Further, on an annual basis, our Company shall prepare a statement of funds utilized for purposes other than

those stated in the Draft Red Herring Prospectus and place it before the Audit Committee. The said disclosure

shall be made till such time that the full money raised through the Issue has been fully spent. The statement shall

be certified by the Statutory Auditors. Further, our Company will furnish to the Stock Exchanges on a quarterly

basis, a statement indicating material deviations, if any, in the use of Issue Proceeds from the Objects stated in

the Draft Red Herring Prospectus. Pursuant to Clause 49 of the listing agreement, our Company shall on a

quarterly basis disclose to the Audit Committee the uses and application of the Issue Proceeds. We will disclose

the utilization of the Issue Proceeds under a separate head in our balance sheet till such time the Issue Proceeds

have been utilized, clearly specifying the purpose for which such proceeds have been utilized. We will also, in

our balance sheet till such time the Issue Proceeds have been utilized, provide details, if any, in relation to all

such Issue Proceeds that have not been utilized thereby also indicating investments, if any, of such unutilized

Issue Proceeds.

No part of the Issue Proceeds of this issue will be paid as consideration to our Promoters, Directors, key

managerial employees or Group Concerns/Companies promoted by our Promoters.

BASIC TERMS OF THE ISSUE

Principal Terms and Conditions of the Issue

The Equity Shares being offered are subject to the provisions of the Companies Act, the SCRR, the

Memorandum and Articles of Association of our Company, conditions of RBI approval, if any, the terms of the

Draft Red Herring Prospectus, Red Herring Prospectus and Prospectus, Bid-cum-Application Form, the

Revision Form, including ASBA forms, Listing Agreements with the Stock Exchanges and other terms and

conditions as may be incorporated in the Allotment Advice, and other documents/certificates that may be

executed in respect of the Issue. The Equity Shares shall also be subject to laws as applicable, guidelines,

notifications and regulations relating to the issue of capital and listing and trading of securities issued from time

to time by SEBI, Government of India, Stock Exchanges, RBI, RoC, FIPB 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 offered shall be subject to the provisions of the Memorandum and Articles of

Association and shall rank pari passu in all respects with the other existing Equity Shares of our Company

including in respect of the rights to receive dividends. The Allottees of the Equity Shares in this Issue shall be

entitled to dividends and/or any other corporate benefits, if any, declared by our Company after the date of

Allotment. For further details, please refer to the section titled „Main Provisions of the Articles of Association‟

Mode of payment of dividend

We shall pay dividend, if declared, to our shareholders as per the provisions of the Companies Act, the Articles

of Association of our Company and the Listing Agreements entered into with the Stock Exchanges.

Face Value and Issue Price per Share

The face value of each Equity Share is ` 10. The Issue Price is [●]. The Floor Price of Equity Shares is ` [●] per

Equity Share and the Cap Price is ` [●] per Equity Share. At any given point of time there shall be only one

denomination of Equity Shares, subject to applicable law. The Price Band and Minimum Bid Lot for the Issue

will be decided by our Company in consultation with the BRLM. These will be published by our Company at

least two Working Days prior to the Issue/Bid opening date, in an English national daily newspaper and a Hindi

national daily newspaper, each with wide circulation.

Compliance with SEBI Rules and Regulations

Our Company shall comply with all applicable 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 subject to any statutory and other preferential claims being

satisfied;

Right of free transferability subject to applicable foreign direct investment policy, foreign exchange

regulations and other applicable laws; 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 agreements executed with the Stock Exchanges, and the Memorandum and

Articles of Association of our Company.

For a detailed description of the main provisions of our Articles of Association such as those dealing with voting

rights, dividend, forfeiture and lien, transfer and transmission and / or consolidation / splitting, please refer to

the section titled „Main Provisions of the Articles of Association‟ beginning on page 185 of the Draft Red

Herring Prospectus.

Market Lot and Trading Lot

Under Section 68B of the Companies Act, the Equity Shares shall be allotted only in dematerialised form. In

terms of existing SEBI ICDR Regulations, the trading in the Equity Shares shall only be in dematerialised form

for all investors. Since trading of the Equity Shares is in dematerialised mode, the tradable lot is one Equity

Share.

Allocation and allotment of Equity Shares through this Issue will be done only in electronic form, in multiple of

one Equity Share, subject to a minimum allotment of [●] Equity Shares.

Jurisdiction

Exclusive jurisdiction for the purpose of the Issue is with the competent courts/authorities in Mumbai.

Joint Holders

Where two or more persons are registered as the holders of any Equity Shares, they shall be deemed to hold the

same as joint – tenants with benefits of survivorship.

Nomination Facility to the 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, the Equity Shares that are 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 such person would be entitled if such person 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/ transfer/ alienation 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 our Company‟s

Registered Office or with the Registrar of our Company.

In accordance with Section 109B of the Companies Act, any person who becomes a nominee by virtue of the

provisions of Section 109A of the Companies Act, shall upon the production of such evidence as may be

required by the Board, elect either:

1. to register himself or herself as the holder of the Equity Shares; or

2. 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 (90)

days, the Board may thereafter withhold payment of all dividends, bonuses or other monies 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 mode, there is no

need to make a separate nomination with us. Nominations registered with respective depository

participant of the applicant will prevail. If the investors require changing the nomination, they are

requested to inform their respective depository participant.

Minimum Subscription

If we do not receive the minimum subscription of 90% of the Issue through the Red Herring Prospectus

including devolvement of Underwriters within 60 days from the date of closure of the Issue, our Company shall

forthwith refund the entire subscription amount received. If there is a delay beyond eight days after our

Company becomes liable to pay the amount, our Company shall pay interest as prescribed under Section 73 of

the Companies Act and the rules formulated thereunder.

Further, in accordance with Regulation 26(4) of the SEBI ICDR Regulations, our Company shall ensure that the

number of prospective allottees to whom the Equity Shares will be Allotted shall not be less than 1,000.

Arrangement for disposal of odd lots

The Equity Shares will be traded in dematerialised form only and therefore the marketable lot is one (1) Equity

Share. Hence, there is no possibility of any odd lots.

The above information is given for the benefit of the Bidders. The Bidders are advised to make their own

enquiries about the limits applicable to them. Our Company and the BRLM do not accept any responsibility for

the completeness and accuracy of the information stated hereinabove. Our Company and the BRLM are not

liable to inform the investors of any amendments or modifications or changes in applicable laws or regulations,

which may occur after the date of the 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.

BASIS FOR ISSUE PRICE

The Issue Price will be determined by our Company in consultation with the BRLM on the basis of assessment

of market demand for the Equity Shares through the Book Building Process. The face value of the Equity Shares

is ` 10 each. The financial data presented in this section are based on our Company‟s restated financial

statements. Investors should also refer to the sections titled „Risk Factors‟ and „Financial Information‟ on pages

xv and 99 respectively, of the Draft Red Herring Prospectus to get a more informed view before making the

investment decision.

Qualitative Factors

For details of Qualitative factors please refer to the heading „Our Competitive Strengths‟ in the chapter titled

“Our Business” beginning on page 57 of the Draft Red Herring Prospectus.

Quantitative Factors

1. Basic & Diluted Earnings Per Share (EPS):

Period Basic and Diluted EPS (`) Weightage

Fiscal 2011 3.48 3

Fiscal 2010 7.05 2

Fiscal 2009 (0.55) 1

Weighted Average 4.00

2. Price to Earnings (P/E) ratio in relation to Issue Price of ` [●]:

a. Based on the basic and diluted EPS of ` 3.48 as per restated financial statements for the year ended

March 31, 2011, the P/E ratio is [●]*

b. Based on the weighted average EPS of ` 4.00, as per restated financial statements the P/E ratio is [●]*

*P/E Ratio will be determined on conclusion of book building process.

c. Industry P/E

Industry P/E

Highest – Unisys Softwares & Holding Industries Limited 113.6

Lowest – Micro Tecnologies (India) Limited 2.7

Average 10.7

Source: Capital Market, VolumeXXVI/07, May 30 – June 12, 2011

3. Return on Net Worth

Period Return on Net Worth (%) Weights

Year ended March 31, 2011 20.53 3

Year ended March 31, 2010 9.88 2

Year ended March 31, 2009 (0.85) 1

Weighted Average 13.42

4. Minimum Return on increased Net Worth required to maintain pre-Issue EPS.

The minimum return on increased net worth required to maintain pre-Issue EPS for the Fiscal 2011:

A) Based on Basic and Diluted EPS of ` 3.48

a. At the Floor Price – [●] % based on restated financial statements.

b. At the Cap Price – [●] % based on restated financial statements.

B) Based on Weighted Average EPS of ` 4.00

a. At the Floor Price – [●] % based on restated financial statements.

b. At the Cap Price – [●] % based on restated financial statements.

5. Net Asset Value per Equity Share

As of March 31, 2011, ` 15.44

NAV per Equity Share after the Issue is ` [●]

Issue Price per Equity Share is ` [●]*

*Issue Price per Equity Share will be determined on conclusion of book building process.

6. Comparison of Accounting Ratios

Particulars EPS – TTM P/E RONW NAV Face

(`) Ratio (%) (`) Value

ASM Technologies Limited 10.3 6.3 25.5 29.7 10

Glodyne Technoserve Limited 34.2 10.0 45.3 119.6 6

GSS America Infotech Limited 8.8 19.5 5.4 200.2 10

Mindteck (India) Limited 2.3 11.0 1.4 57.2 10

Saksoft Limited 1.1 43.6 3.5 46.7 10

Tejora Technologies Limited (FY 2011) 3.48 [●] 20.53 15.44 10

All the above figures are on Standalone basis

Source: Capital Market, VolumeXXVI/07, May 30 – June 12, 2011

7. The face value of Equity Shares of our Company is ` 10 per Equity Share and the Issue price is [●] times

the face value at the Floor Price and [●] times the face value at the Cap Price. The Issue Price of ` [●] is

determined by our Company, in consultation with the BRLM, on the basis of assessment of market demand

for the Equity Shares through the Book Building Process and is justified based on the above accounting

ratios. For further details, please refer to the section titled „Risk Factors‟, and chapters titled „Our Business‟

and „Financial Information‟ beginning on pages xv, 57 and 99 respectively of the Draft Red Herring

Prospectus.

STATEMENT OF TAX BENEFITS

The Board of Directors,

Tejora Technologies Limited,

Unit No. 2, 8th

Floor, A-Wing,

Prism Towers, Mindspace,

Goregaon (West),

Mumbai – 400 104,

Maharashtra.

Dear Sirs,

Statement of Possible Direct Tax Benefits

We hereby confirm that the enclosed annexure, prepared by Tejora Technologies Limited („the Company‟),

states the possible tax benefits available to the Company and the shareholders of the Company under the

Income-tax Act, 1961 („IT Act‟) and the Wealth Tax Act, 1957, presently in force in India. Several of these

benefits are dependent on the company or its shareholders fulfilling the conditions prescribed under the relevant

provisions of the Act. Hence, the ability of the Company or its shareholders to derive the tax benefits is

dependent upon fulfilling such conditions, which is based on the business imperatives, the company may or may

not choose to fulfil.

The benefits discussed in the Annexure are not exhaustive and the preparation of the contents stated is the

responsibility of the Company‟s management. We are informed that this statement is only intended to provide

general information to the investors and hence is neither designed nor intended to be a substitute for professional

tax advice.

In view of the individual nature of the tax consequences, 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.

Our confirmation is based on the information, explanations and representations obtained from the company and

on the basis of our understanding of the business activities and operations of the company and the interpretation

of the current tax laws in force in India.

We do not express any opinion or provide any assurance as to whether:

The Company or its shareholders will continue to obtain these benefits in future; or

The conditions prescribed for availing the benefits, where applicable have been/would be met.

The contents of the 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.

No assurance is given that the revenue authorities/courts will concur with the views expressed herein. Our views

are based on the existing provisions of law and its interpretation, which are subject to change from time to time.

Yours faithfully,

For Gopal Rao & Associates

N.G. Rao

Proprietor

Membership No. 033665

Firm Registration No. 127055W

Date: June 30, 2011

STATEMENT OF POSSIBLE DIRECT TAX BENEFITS AVAILABLE TO TEJORA

TECHNOLOGIES LIMITED AND TO ITS SHAREHOLDERS

A. TO COMPANY

I. SPECIAL TAX BENEFITS

There are no special benefits accruing to the Company.

II. GENERAL TAX BENEFITS

1. As per section 10(34) of the Act, income earned by the Company by way of dividend from another

domestic company referred to in section 115-O of the Act is exempt from tax.

2. As per section 10(35) of the Act, the following income will be exempt from tax in the hands of the

Company:

a) Income received in respect of the units of a Mutual Fund specified under section 10(23D);

b) Income received in respect of units from the Administrator of the specified undertaking;

c) Income received in respect of units from the specified company

3. As per section 10(38) of the Act, long term capital gains arising to the Company from the transfer of a long

term capital asset being an equity share in a company or a unit of an equity oriented fund, where such

transaction is chargeable to securities transaction tax, will be exempt in the hands of the Company.

4. Under section 32 of the Act, the Company is entitled to claim depreciation subject to the conditions

specified therein, at the prescribed rates on its specified assets used for its business.

5. As per section 54EC of the Act and subject to the conditions and to the extent specified therein, long-term

capital gains (in cases not covered under section 10(38) of the Act) arising on the transfer of a long-term

capital asset will be exempt from tax if the capital gains are invested in a “long term specified asset” within

a period of six months after the date of such transfer, subject to the limit of Rupees Five Millions in a year.

6. As per section 111A of the Act, short term capital gains arising to the Company from the sale of Equity

Shares or units of an equity oriented mutual fund transacted through a recognized stock exchange in India,

where such transaction is chargeable to securities transaction tax, will be taxable at the rate of 15%.

7. As per section 112 of the Act, the tax on capital gains on transfer of listed securities or units where the

transaction is not chargeable to securities transaction tax, held as long term capital assets will be the lower

a) 20% of the capital gains as computed after indexation of the cost; or

b) 10% of the capital gains as computed without indexation.

8. As per Section 80G of the Act, the Company is entitled to claim deduction of an specified amount in respect

of eligible donations subject to the fulfilment of the conditions specified in that section as per the provisions

of Chapter XVII-B of the Income-Tax Act.

9. The amount of tax paid under section 115JB by the Company will be available as credit to the extent

specified in section 115JAA for ten years succeeding the assessment year in which MAT credit becomes

allowable in accordance with the provisions of Section 115JAA.

B. TO MEMBERS

I. Special Benefits

There are no special benefits accruing to the members.

II. General Benefits

(A) Resident Members

1. As per section 10(34) of the Act, income earned by the resident members by way of dividend from the

domestic company referred to in section 115-O of the Act is exempt from tax.

2. As per section 10(38) of the Act, long term capital gains arising to the resident members from the transfer

of a long term capital asset being an equity share in a company or a unit of an equity oriented fund, where

such transaction is chargeable to securities transaction tax, will be exempt in the hands of such members.

3. As per section 111A of the Act, short term capital gains arising to the resident members from the sale of

equity shares or units of an equity oriented mutual fund transacted through a recognized stock exchange in

India, where such transaction is chargeable to securities transaction tax, will be taxable at the rate of 15%.

a. 20% of the capital gains as computed after indexation of the cost; or

b. 10% of the capital gains as computed without indexation.

6. As per the provisions of 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 will be exempt from tax if the net consideration is utilised, within a period of one year before, or

two years after the date of transfer, in the purchase of a residential house, or for construction of a residential

house within three years.

(B) Non-Resident Indian Members

1. As per section 10(34) of the Act, income earned by way of dividend from the domestic company referred to

in section 115-O of the Act is exempt from tax.

2. 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 in a company or a unit of an equity oriented fund, where such transaction is

chargeable to securities transaction tax, will be exempt.

3. As per section 111A of the Act, short term capital gains arising from the sale of equity shares or units of an

equity oriented mutual fund transacted through a recognized stock exchange in India, where such

transaction is chargeable to securities transaction tax, will be taxable at the rate of 15%.

a. 20% of the capital gains as computed after indexation of the cost; or

b. 10% of the capital gains as computed without indexation.

5. As per the first proviso to section 48 of the Act, in case of a non resident shareholder, the capital gain/loss

arising from transfer of shares or debentures of the Company, acquired in convertible foreign exchange,

will be computed by converting the cost of acquisition, sales consideration and expenditure incurred wholly

and exclusively incurred 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.

7. As per the provisions of 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 will be exempt from tax if the net consideration is utilised, within a period of one year before, or

two years after the date of transfer, in the purchase of a residential house, or for construction of a residential

house within three years.

8. As per section 115E of the Act, income from investment or income from long term capital gains on transfer

of assets other than specified asset shall be taxable at the rate of 20%. Income by way of long term capital

gains in respect of a specified asset (as defined in section 115C (f) of the Act) shall be chargeable at 10%.

9. In accordance with section 115F of the Act, subject to the conditions and to the extent specified therein,

long term capital gains arising from transfer of shares of the Company acquired out of convertible foreign

exchange, and on which securities transaction tax is not payable, shall be exempt from capital gains tax, if

the net consideration is invested within six months of the date of transfer in any specified asset.

10. In accordance with section 115G of the Act, It is not necessary for a non-resident Indian to file a return of

income under section 139 (1) of the Act, if his total income consist only of investment income earned on

shares of the Company acquired out of convertible foreign exchange or Income by way of long term capital

gains earned on transfer of shares of the company acquired out of convertible foreign exchange, and the tax

has been deducted at source from such income as per the provisions of Chapter XVII-B of the Income-Tax

11. As per section 115H of the Act, where a 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 such investment income derived from the specified assets for that year and subsequent

assessment years until such assets are converted into money.

12. In accordance with section 115-I of the Act, Where a non-resident Indian opts not to be governed by the

provisions of Chapter XII-A for any assessment year, his total Income for that assessment year (Including

Income arising from Investment in the Company) will be computed and tax will be charged according to the

other provisions of the Income-Tax Act.

13. 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 has Fiscal domicile.

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.

(C) Foreign Institutional Investors (FII‟s)

1. As per section 10(34) of the Act, any income earned by way of dividend income from the domestic

Company referred to in section 115-O of the Act is exempt from tax.

2. 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 is chargeable to securities transaction

tax, will be exempt.

3. As per section 115AD read with section 111A of the Act, short term capital gains arising from the sale of

Equity Shares of the Company transacted through a recognized stock exchange in India, where such

transaction is chargeable to securities transaction tax, will be taxable at the rate of 15%.

4. As per section 115AD of the Act, FIIs will be taxed on the capital gains that are not exempt under the

provisions 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

In case of long term capital gains, (in cases not covered under section 10(38) and section 115 AD of the

Act), the tax is levied on the capital gains computed without considering the cost indexation and without

considering foreign exchange fluctuation.

5. 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 has fiscal domicile. 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.

a period of six months after the date of such transfer, subject to the limit of ` 5 million in a year.

(D) 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.

(E) Venture Capital Companies / Funds

As per section 10(23FB) of the Act, all Venture Capital Companies/Funds registered with the Securities and

Exchange Board of India, subject to the conditions specified, are eligible for exemption from income tax on

their entire income, including income from sale of shares of the company. However, under section 115U of the

Act, income received by a person out of investment made in a venture capital company or in a venture capital

fund will be chargeable to tax in the hands of such person.

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.

(i) In the above statement only basic tax rates have been enumerated and the same is subject to surcharge

and education cess, wherever applicable.

(ii) 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 equity shares.

(iii) All the above benefits are as per the current tax laws, legislation, its judicial interpretation and the

policies of the regulatory authorities are subject to change from time to time, and these may have a

bearing on the benefits listed above. Accordingly, any change or amendments in the law or relevant

regulations would necessitate a review of the above.

(iv) Several of these benefits are dependent on the company and its shareholders fulfilling the conditions

prescribed under the provisions of the relevant sections under the relevant tax laws.

(v) This statement is only extended 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 tax

consequences, being based on all the facts, in totality, of the investors, each investor is advised to

consult his/her/its own tax advisor with respect to specific tax consequences of his/her/its investments

in the shares of the Company.

SECTION IV – ABOUT THE COMPANY

INDUSTRY OVERVIEW

Disclaimer: Pursuant to the requirements of the SEBI ICDR Regulations, the discussion on the business of Our

Company in this Draft Red Herring Prospectus consists of disclosures pertaining to industry grouping and

classification. The industry grouping and classification is based on our Company's own understanding and

perception and such understanding and perception could be substantially different or at variance from the views

and understanding of third parties. Our Company acknowledges that certain products described in the Draft

Red Herring Prospectus could be trademarks, brand names and/ or generic names of products owned by third

parties and the reference to such trademarks, brand names and/or generic names in the Draft Red Herring

Prospectus is only for the purpose of describing the products. The industry data has been collated from various

industry and/or research publications and from information available from the World Wide Web.

The information in this section is derived from various government/Industry Association publications and other

sources. Neither we, 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 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.

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