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Private & Confidential – Not for Circulation (The Information Memorandum is neither a Prospectus nor Statement in Lieu of Prospectus)

Dated: 25th February, 2015 (This is a Disclosure Document prepared in conformity with Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 issued vide circular no. LAD‐NRO/GN/2008/13/127878 dated June 06, 2008 and Securities & Exchange Board of India (Issue & Listing of Securities) (Amendment) Regulations, 2012)) and Securities & Exchange Board of India (Issue & Listing of Securities) (Amendment) Regulations, 2014 issued vide circular no. LAD‐NRO/GN/2013‐14/43/207 dated January 31, 2014 and the Companies Act, 2013 read with the Companies (Prospectus and Allotment of Securities) Rules, 2014

TALWALKARS BETTER VALUE FITNESS LTD.

Registered / Corporate Office : 801‐813, Mahalaxmi Chambers, 22, Bhulabhai Desai Road, Mumbai – 400 026

Contact Person : Ms. Avanti Sankav

Telephone : 022‐66126300 (324)

Fax : 022‐66126363

E‐Mail : [email protected]

PRIVATE PLACEMENT OF SECURED, REDEEMABLE, NON‐CONVERTIBLE DEBENTURES OF RS. 10,00,000/‐ EACH FOR TOTAL FACE VALUE OF RS. 25 CRORES

Rating “AA‐” BY CARE LIMITED

GENERAL RISK For taking an investment decision, investors must rely on their own examination of the issue, the disclosure document and the risk involved. The Securities have not been recommended or approved by SEBI nor does SEBI guarantee the accuracy or adequacy of this disclosure document.

ISSUER’S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Disclosure Document contains all information with regard to the Issuer and the Issue, which is material in the context of the Issue, that the information contained in this Disclosure Document is true and correct in all material respects 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 this document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.

CREDIT RATING ‘CARE AA‐’ by Credit Analysis and Research Ltd. (CARE). This rating indicates high safety and issuer’s capacity for timely servicing of debt obligations. The rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. The rating may be subject to revision or withdrawal at any time by the assigning rating agency and each rating should be evaluated independently of any other rating. The ratings obtained are subject to revision at any point of time in the future. The rating agency has the right to suspend, withdraw the rating at any time on the basis of new information etc.

LISTING The Secured Redeemable Non‐Convertible Debentures are proposed to be listed on the Whole Sale Debt Market Segment of the BSE Limited (‘BSE’).

ARRANGER TO THE ISSUE

DEBENTURE TRUSTEE REGISTRAR AND TRANSFER AGENT

Axis Bank Ltd

Axis House, 8th Floor, Wadia International Centre, P B Marg,

Worli, Mumbai – 400 025 Tel : (91‐22) 24252869 Fax: +91 22 – 24253800

SBICAP Trustee Company Limited

6th Floor, Apeejay House, 3, Dinshaw Wachha Road,

Churchgate, Mumbai 400 020

Tel: (O) 022 – 43025555 Fax No:‐ 022 –22040465

Link Intime India Private Ltd C‐13, Pannalal Silk Mills Compound

L.B.S Marg Bhandup (West)

Mumbai – 400 078 Tel No.: (022) 25946970 Fax No.: (022) 2596 2691

Deemed date of Allotment : 4TH March, 2015

ISSUE OPEN FROM 4th March, 2015 to 4th March, 2015

TABLE OF CONTENTS

INDEX TITLE Page No.

I. DEFINITIONS/ ABBREVIATIONS 3

II. DISCLAIMER 4

III. NAME AND ADDRESS OF REGISTERED/ HEAD OFFICE OF THE ISSUER 6

IV. NAMES AND ADDRESSES OF THE DIRECTORS OF THE ISSUER 7

V. BRIEF SUMMARY OF BUSINESS/ ACTIVITIES OF ISSUER AND ITS LINE OF BUSINESS 8

VI BRIEF HISTORY OF ISSUER SINCE INCORPORATION, DETAILS OF ACTIVITIES INCLUDING ANY REORGANIZATION, RECONSTRUCTION OR AMALGAMATION, CHANGES IN CAPITAL STRUCTURE, (AUTHORIZED, ISSUED AND SUBSCRIBED) AND BORROWINGS

13

VII. SUMMARY TERM SHEET 32

VIII.

TERMS OF OFFER (DETAILS OF DEBT SECURITIES PROPOSED TO BE ISSUED, MODE OF ISSUANCE, ISSUE SIZE, UTILIZATION OF ISSUE PROCEEDS, STOCK EXCHANGES WHERE SECURITIES ARE PROPOSED TO BE LISTED, REDEMPTION AMOUNT, PERIOD OF MATURITY, YIELD ON REDEMPTION, DISCOUNT AT WHICH OFFER IS MADE AND EFFECTIVE YIELD FOR INVESTOR)

34

IX. CREDIT RATING & RATIONALE THEREOF 44

X. NAME OF DEBENTURE TRUSTEE 45

XI. STOCK EXCHANGE WHERE SECURITIES ARE PROPOSED TO BE LISTED 45

XII.

DETAILS OF OTHER BORROWINGS (DETAILS DEBT SECURITIES ISSUED IN THE PAST, PARTICULARS OF DEBT SECURITIES ISSUED FOR CONSIDERATION OTHER THAN CASH OR AT A PREMIUM OR DISCOUNT OR IN PURSUANCE OF AN OPTION, HIGHEST TEN HOLDERS OF EACH CLASS OR KIND OF SECURITIES, DEBT EQUITY RATIO)

46

XIII. SERVICING BEHAVIOR ON EXISTING DEBT SECURITIES AND OTHER BORROWINGS 47

XIV. UNDERTAKING REGARDING COMMON FORM OF TRANSFER 48

XV. MATERIAL EVENT, DEVELOPMENT OR CHANGE AT THE TIME OF ISSUE 48

XVI. PERMISSION / CONSENT FROM PRIOR CREDITORS 48

XVII. MATERIAL CONTRACTS & AGREEMENTS INVOLVING FINANCIAL OBLIGATIONS OF THE ISSUER

48

XVIII. DECLARATION 48

XIX. ANNEXURES

A. CREDIT RATING LETTER FROM CARE 50

B. RATING RATIONALE FROM CARE 52

C. CONSENT LETTER FROM SBICAP TRUSTEE COMPANY LTD 60

D. APPLICATION FORM 61

E. INSTRUCTIONS 63

I. DEFINITIONS/ ABBREVIATIONS

Act The Companies Act, 2013 as amended from time to time till date

Application Form The form in terms of which the investors shall apply for the Secured Taxable Redeemable Non‐Convertible Debentures of the Company.

Board Board of Directors of Talwalkars Better Value Fitness Ltd.

Bondholder(s) The holder(s) of the NCDs

BSE Bombay Stock Exchange

NCDs Secured Taxable Redeemable Non‐Convertible NCDs issued under the terms of this Disclosure Document

CBDT Central Board of Direct Taxes

CDSL Central Depository Services (India) Ltd.

Debt Securities Non‐Convertible debt securities which create or acknowledge indebtedness and include debenture, NCDs and such other securities of the Issuer, whether constituting a charge on the assets of the Issuer or not, but excludes security receipts and securitized debt instruments

DDA Deemed Date of Allotment

EPS Earnings Per Share

FIs Financial Institutions

FIIs Foreign Institutional Investors

FY Financial Year

GOI Government of India

Issuer Company/ the Company/ TBVFL

Talwalkars Better Value Fitness Ltd., a company incorporated under the Companies Act, 1956 and having its Registered Office at 801‐813, Mahalaxmi Chambers, 22, Bhulabhai Desai Road, Mumbai – 400 026

IT Act Income Tax Act, 1961 as amended from time to time till date

IST Indian Standard Time (Greenwich Mean Time + 0530 hours)

Arranger Axis Bank Limited

MFs Mutual Funds

NCDs Secured Taxable Redeemable Non‐Convertible Debentures

NRIs Non Resident Indians

NSDL National Securities Depository Ltd.

OCBs Overseas Corporate Bodies

Offer / Issue Private Placement of NCDs of TBVFL in terms of this Disclosure Document

Disclosure Document

The Disclosure Document dated 25th February, 2015 for issue of Secured, Taxable, Redeemable, Non‐Convertible Debentures of Rs. 10,00,000/‐ each for total face value of Rs. 25 crores to be issued by Talwalkars Better Value Fitness Ltd

RBI Reserve Bank of India

Registrars to the issue

Link Intime India Pvt. Ltd.

RTGS Real Time Gross Settlement

SEBI Securities and Exchange Board of India

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

SEBI Regulations Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 issued vide Circular No. LAD‐NRO/GN/2008/13/127878 dated June 06, 2008 and Securities & Exchange Board of India (Issue & Listing of Securities) (Amendment) Regulations, 2012) & Securities & Exchange Board of India (Issue & Listing of Securities) (Amendment) Regulations, 2014 issued vide circular no. LAD‐NRO/GN/2013‐14/43/207 dated January 31, 2014

Trustee for the Bondholders

SBICAP Trustee Company Limited

YTM Yield to Maturity

II. DISCLAIMER GENERAL DISCLAIMER This Disclosure Document is neither a Prospectus nor a Statement in Lieu of Prospectus and is prepared in accordance with Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 issued vide Circular No. LAD‐NRO/GN/2008/13/127878 dated June 06, 2008 and Securities & Exchange Board of India (Issue & Listing of Securities) (Amendment) Regulations, 2012) and Securities & Exchange Board of India (Issue & Listing of Securities) (Amendment) Regulations, 2014 issued vide circular no. LAD‐NRO/GN/2013‐14/43/207 dated January 31, 2014 and the Companies Act, 2013 read with the Companies (Prospectus and Allotment of Securities) Rules, 2014. This document does not constitute an offer to the public generally to subscribe for or otherwise acquire the NCDs to be issued by Talwalkars Better Value Fitness Ltd (the “Issuer”/ “TBVFL”). The document is for the exclusive use of the Institutions to whom it is delivered and it should not be circulated or distributed to third party(ies). TBVFL certifies that the disclosures made in this document are generally adequate and are in conformity with the captioned SEBI Regulations. This requirement is to facilitate investors to take an informed decision for making investment in the proposed Issue.

This Issue is being made strictly on a private placement basis and nothing in this Disclosure Document shall constitute and/or deem to constitute an offer or an invitation to an offer to the Indian public or any section thereof to subscribe for or otherwise acquire the NCDs. This Disclosure Document should not be construed to be a prospectus or a statement in lieu of prospectus under the Companies Act.

This Disclosure Document and the contents hereof are restricted for only the intended recipient(s) who have been addressed directly and specifically through a communication by the Issuer and only such recipients are eligible to apply for the NCDs. All investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this Issue. Therefore, as per the applicable provisions, a copy of this Disclosure Document has not been filed or submitted to the SEBI for its review and/or approval. Further, since this Issue is being made on a private placement basis, the provisions of Section 60 of the Companies Act shall not be applicable and accordingly, a copy of this Disclosure Document has not been filed with the RoC or the SEBI.

DISCLAIMER OF THE SECURITIES & EXCHANGE BOARD OF INDIA This Disclosure Document has not been filed with Securities & Exchange Board of India (SEBI). The Securities have not been recommended or approved by SEBI nor does SEBI guarantee the accuracy or adequacy of this document. It is to be distinctly understood that this document should not, in any way, be deemed or construed that the same has been cleared or vetted by SEBI. SEBI does not take any responsibility either for the financial soundness of any scheme or the project for which the Issue is proposed to be made, or for the correctness of the statements made or opinions expressed in this document. The issue of NCDs being made on private placement basis, filing of this document is not required with SEBI, however SEBI reserves the right to take up at any point of time, with the Issuer, any irregularities or lapses in this document. DISCLAIMER OF THE ARRANGER

The Issuer is solely responsible for the truth, accuracy and completeness of all the information provided in this Information Memorandum. Neither is the Arranger responsible for preparing, clearing, approving, scrutinizing or vetting this Information Memorandum, nor is the Arranger responsible for doing any due diligence for verification of the truth, correctness or completeness of the contents of this Information Memorandum. The Arranger shall be entitled to rely on the truth, correctness and completeness of this Information Memorandum. It is to be distinctly understood that the aforesaid use of this Information Memorandum by the Arranger should not in any way be deemed or construed to mean that the Information Memorandum has been prepared, cleared, approved, scrutinized or vetted by the Arranger. Nor should the contents of this Information Memorandum in any manner be deemed to have been warranted, certified or endorsed by the Arranger as to the truth, correctness or completeness thereof. Each recipient must satisfy itself as to the accuracy, reliability, adequacy, reasonableness or completeness of the Information Memorandum. The Arranger has not conducted any due diligence review on behalf or for the benefit of the Debenture Trustee or any of the Debenture Holder. Each of the Debenture Holder should conduct such due diligence on the Issuer, the Debentures and the Security, as it deems appropriate and make its own independent assessment thereof.

Distribution of this Information Memorandum does not constitute a representation or warranty, express or implied by the Arranger that the information and opinions herein will be updated at any time after the date of this Information Memorandum. The Arranger does not undertake to notify any recipient of any information coming to the attention of the Arranger after the date of this Information Memorandum. No responsibility or liability or duty of care is or will be accepted by the Arranger for updating or supplementing this Information Memorandum nor for providing access to any additional information as further information becomes available. Neither the Arranger nor any of their respective directors, employees, officers or agents shall be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying on any statement in or omission from this Information Memorandum or in any other information or communications made in connection with the Debentures. The Arranger is acting for the Company in relation to the Issue of the Debentures and not on behalf of the recipients of this Information Memorandum. The receipt of this Information Memorandum by any recipient is not to be constituted as the giving of investment advice by the Arranger to that recipient, nor to constitute such a recipient a customer of the Arranger. The Arranger is not responsible to any other person for providing the protection afforded to the customers of the Arranger nor for providing advice in relation to the Debentures. Each recipient of this Information Memorandum acknowledges that: (a) each recipient has been afforded an opportunity to request and to review and has received all additional

information considered by the recipient to be necessary to verify the accuracy of or to supplement the information contained herein; and

(b) such recipient has not relied on the Sole Arranger in connection with its investigation of the accuracy of such information or its investment decision.

DISCLAIMER OF THE ISSUER The Issuer certifies that the disclosures made in this Disclosure Document are generally adequate and in conformity with the SEBI/ RBI regulations and directions. Further, the Issuer accepts no responsibility for statements made otherwise than in this Disclosure Document or any other material issued by or at the instance of the Issuer and anyone placing reliance on any source of information other than this Disclosure Document would be doing so at his own risk. Further, the Issuer and its directors have not been prohibited from accessing the capital market under any order or directions passed by SEBI. DISCLAIMER OF THE STOCK EXCHANGE As required, a copy of this Disclosure Document has been submitted to the Bombay Stock Exchange (BSE)for hosting the same on its website. It is to be distinctly understood that such submission of the document with BSE or hosting the same on its website should not in any way be deemed or construed that the document has been cleared or approved by BSE; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this document; nor does it warrant that this Issuer’s securities will be listed or continue to be listed on the Exchange; nor does it take responsibility for the financial or other soundness of this Issuer, its promoters, its management or any scheme or project of the Issuer. Every person who desires to apply for or otherwise acquire any securities of this Issuer may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against the Exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or any other reason whatsoever.

III. NAME AND ADDRESS OF REGISTERED/ HEAD OFFICE OF THE ISSUER Name of the Issuer : Talwalkars Better Value Fitness Ltd. Registered Office : 801‐813, Mahalaxmi Chambers, 22, Bhulabhai Desai Road, Mumbai – 400 026

Tel. No. : +91‐022‐66126300 (324)

Fax No. : +91‐022‐66126363 E‐mail : [email protected]

Website : www.talwalkars.net

Compliance Officer of the issuer : Ms. Avanti Sankav

Chief Financial Officer of the Issuer : Mr. Anant Gawande

Auditors of the issuer : M. K. Dandeker & Co., Chartered Accountants.

(Since Annual General Meeting of the Company held on 12th August, 2012, earlier Statutory Auditors ‐ Saraf Gurkar & Associates, Chartered Accountants.)

Arrangers of the Issue : Axis Bank Limited Axis House C‐2, Wadia International Centre, Pandurang Budhkar Marg, Worli

Mumbai ‐ 400025 Tel no : (022)24252525 Contact Person : Mr. Sharad Sawant Email: [email protected]

Trustee of the issue : SBICAP Trustee Company Limited 6th Floor, Apeejay House, 3, Dinshaw Wachha Road, Churchgate, Mumbai 400 020 Tel: (O) 022 – 43025555 Fax No:‐ 022 –22040465 Contact Person : Mr. Ajit Joshi Email : [email protected]

Registrar of the issue : Link Intime India Private Limited C‐13, Pannalal Silk Mills Compound LBS Marg, Bhandup (West), Mumbai ‐ 400 078 Tel No:‐ 022 – 25963838 Fax No:‐ 022 ‐ 2594 6979 Contact Person : Mr. Ganesh Jadhav Email : [email protected]

Credit Rating Agency of the issue : Credit Analysis & Research Ltd. 4th Floor, Godrej Coliseum, Somaiya Hospital Road, Off Eastern Express Highway, Sion (East), Mumbai – 400 022 Tel No:‐ 022 – 67543429 ; Fax No:‐ 022 – 67543457 Email: [email protected] Contact Person : Ms. Rashmi Narvankar

IV. NAME & ADDRESSES OF THE DIRECTORS OF THE ISSUER The composition of the Board of Directors of the TBVFL as on date of this Disclosure Document is as under:

Sr. No.

Name Designation Address

1.

Mr. Girish Madhukar Talwalkar

Chairman

D‐22, New Juhu, Park Co‐operative Housing Society, 3rd floor, Opp. ISKON Temple, Juhu,Mumbai 400 049.

2. Mr. Madhukar Vishnu Talwalkar Director

C‐37/40, Pandurang Society, Dr. A. B. Nair Road, Juhu, Mumbai 400 049.

3.

Mr. Prashant Sudhakar Talwalkar Managing Director & CEO

26, Sheesh Mahal, D’Monte Park Road, Bandra (West), Mumbai 400 050.

4.

Mr. Vinayak Ratnakar Gawande Whole‐time Director

A‐231, Twin Towers, Twin Tower Lane, Opp. Siddhivinayak Temple, Prabhadevi, Mumbai – 400 025

5.

Mr. Harsha Ramdas Bhatkal

Whole‐time Director

N‐5, Prathamesh CHS, Off. Veer Savarkar Road, Prabhadevi, Mumbai‐ 400 025.

6.

Mr. Anant Ratnakar Gawande

Whole‐time Director & CFO

A/173, Twin Tower, Twin Tower Lane, Off. Veer Savarkar Marg, Prabhadevi, Mumbai‐ 400 025, Maharashtra

7.

Mr. Manohar Gopal Bhide

Independent Director

A/5, Bageshree, Shankar Ghanekar Marg, Prabhadevi, Mumbai‐ 400 025.

8.

Mr. Raman Hirji Maroo


21/A, Woodland, 67 Dr. G. Deshmukh Marg, Mumbai 400 026.

9.

Mr. Mohan Motiram Jayakar


12, Makani Manor, Peddar Road, Mumbai‐ 400 026.

10 Dr. Avinash Achyut Phadke


A‐Flat No. 41, 4th Floor, The Shrieesh CHS, 187, V.S. Marg, Mahim, Mumbai – 400016.

11 Mr. Abhijeet Rajaram Patil


3rd Floor, 214, Sweet Home, L.J Road, Mahim (West), Mumbai 400 016.

12 Mr. Dinesh Kishanrao Afzulpurkar Independent Director

P‐11, 5 Buena Vista, General Jagannath BhosaleMarg, Mumbai – 400021.

V. BRIEF SUMMARY OF BUSINESS/ ACTIVITIES OF THE ISSUER AND ITS LINE OF BUSINESS

Indian Wellness Industry In India, wellness is a concept which has been in vogue since ancient times. Traditional medicinal and health practices like Ayurveda and Yoga have propounded the concept of mental and bodily wellness. Most of the ancient wellness concepts have largely focused on the basic needs of an individual within the need hierarchy, namely a focus on health, nutrition and relaxation. With the progress of time, wellness as a concept has taken up a multi‐dimensional definition, encompassing the individual’s desire for social acceptance, exclusivity and collective welfare. Chiefly influenced by changes in society and in the lifestyles of individuals, this change has also been accelerated by extraneous factors like globalization and a great awareness of the need for wellness among individuals. The Indian wellness industry is divided into the following segments:

Beauty services and cosmetic products – Salons and beauty centers, Cosmetic treatments (invasive and non‐invasive)

Fitness Centers – Gyms, Health Clubs and Slimming centers

Nutrition – Health and wellness foods, Organic food etc.

Alternate therapy ‐ Ayurveda, Homeopathy, Unani, Naturopathy etc.

Rejuvenation – Spas, Foot reflexology etc. Indian Fitness Market The fitness and slimming market in India is Rs. 60 billion of which, 50% is the fitness services sector. The fitness services sector in India continues to be fragmented with a large number of players. Most leading fitness chains have grown aggressively and have doubled their number of centers. Expansion has been mostly driven by entry into Tier 2 and Tier 3 cities and towns. In order to attract new customers and retain interest levels, organized fitness service providers are looking beyond plain‐ vanilla services and adding new service offerings like pilates, spinning, and power yoga to boost revenues. Presently, the fitness industry is in its nascent stages. The industry is very fragmented with majority of the market being dominated by a large number of mom‐and‐pop gyms. Every club offers similar basic gym facilities and there is complete lack of product differentiation. The market also appears to have a shortage of talent, since qualified personal trainers, nutrition consultants and professional managers are scarce, which also contributes to the lack of differentiation. This high degree of fragmentation, lack of product differentiation, and customer price sensitivity result in prevalent price competition and low margins. Yet, on the other hand, awareness about fitness and a healthy lifestyle is growing; along with higher disposable incomes and a growing young population. This is largely under penetrated market with less than 5% penetration of the urban population. Organized players focus on below the line marketing to increase awareness about fitness among consumers. Source: PWC FICCI Wellness Report, September 2011; PWC FICCI Winds of change, August 2012, PWC FICCI Imperatives for growth August 2013 Growth Drivers for Fitness Industry in India:

Change in demographic profile India has a population of around a billion which is growing at a rate of about 1.7%. In general, more people between the ages of 18‐54 exercise. However, in India age group 20‐44 can be mainly identified as prime market for fitness clubs. The proportion of people in the age group of 20‐44 is projected to go up. The rising youth population becomes the prime users of the health clubs in India. Increase in young and working population coupled with increase in disposable income will have a positive effect on the industry with larger number of people enrolling for health related services and products. The desire to be fit, backed by increase in disposable income, will create more demand for niche fitness services like personal training, massage, spinning, aerobics etc.

Source: PWC FICCI Wellness Report, September 2011

Increasing incidence of lifestyle diseases Significant changes in lifestyle related to lack of physical activity and increased consumption of fast foods among both affluent and working class population has led to the greater need for healthy lifestyles through sports, fitness centers and counseling on dietary habits. According to International Diabetic Federation (IDF)’s latest report released at the 20th annual World Diabetes Congress in Oct 2009, India leads the world in the number of people suffering from diabetes and by 2030 nearly 9 per cent of the country's population is likely to be affected from the disease. About 50.8 million people are now suffering from the looming epidemic of diabetes, followed by China with 43.2 million. IDF estimates that Type 2 diabetes constitutes about 85% to 95% of all diabetes cases in developed countries and accounts for an even higher percentage in developing countries. There is a huge emphasis on regular exercise to prevent obesity and diabetes. IDF estimates that up to 80% of type 2 diabetes is preventable by adopting a healthy diet and increased physical activity.

As per PWC FICCI Wellness Report the incidence of coronary heart disease in India by 2015 is expected to rise by 46% as compared to 2010 while cases for diabetes are expected to grow 32% as compared to 2010. Health clubs can play a vital role in taking preventive measures towards lifestyle diseases.


Growing realization of a need for healthy lifestyle Awareness in the country on diseases like diabetes is increasing. According to AC Nielsen’s Global Online Consumer Survey findings released in Feb 2009, 54 percent Indian respondents think they have issues with their weight. About 80% people said they exercise at least once a week. Going to a gym is second most preferred option for exercise after walking.

The findings of the survey are very encouraging. Indians are adopting various actions to reduce their weight. 79 percent respondents plan to exercise more, the second highest percentage for a country globally after New Zealand (86), that is planning to exercise more to lose weight. 69 percent of Indians are changing their diet plans to lose weight.

Increased awareness among the masses has opened a huge vista for the industry to expand. The demand for fitness related products and services will increase tremendously with more and more people becoming sensitive towards their health.

35%

18%17%

16%

14%

Walking

Gym

Yoga/Pilates

Running/Jogging

Others

Forms of exercise preferred by Indians

Source: Nielsen survey Feb 2009

20%

22%

36%

22%Never

1‐2days a week

3‐6days a week

Daily

Source: Nielsen survey Feb 2009

Frequency of exercise

Indian youth (in the age group 15 to 34 years) comprises over 34% of the total population. This is expected to cross over 400mn by 2015 and forms the core target group for wellness products and services.

Higher disposable income India’s growing middle‐class is fuelling demand for fitness.


Source: PWC FICCI Wellness Report, September 2011 This rapid increase in wealth can also be visibly seen in the several posh residential complexes that have emerged in the top few Indian cities like Mumbai, NCR, Chennai, Kolkata, Hyderabad, Bangalore and Pune. This segment of population provides an upscale market for fitness centers to offer not just the basic gym facility but also advanced value added activities like spas, steam/sauna bath, nutrition centers, aerobics, spinning studios and personal training program.

Growing urbanisation is resulting in higher awareness levels. o The urban population constituted 28% of total population in 2001, this is expected to increase to 37%

in 2025.

o Increasing urbanisation has the dual impact of higher availability and awareness of wellness products

as well as higher incidence of stress‐related disorders and lifestyle diseases.

o This is driving growth in products and services in the enhancement and curative segments.

Source: PWC FICCI Wellness Report, September 2011 The urbanization, industrialization and economic liberalization have led to a rapid rise in the middle and upper class in Indian population. The steep rise in urban population will leave limited scope for open area physical activities leading to a sedentary lifestyle. Along with urbanization there has been regional development with smaller towns becoming mini‐metro of India, which has led to an increased demand for fitness services.

Source: PWC FICCI Wellness Report, August, 2012

9070

30

187

377

0

50

100

150

200

250

300

350

400

Tier 1 Tier 2 Tier 3 Other Urban

Total Urban

Urban population in Million

Increase in discretionary spends is positive for the industry.

• Rising incomes are resulting in increasing discretionary expenditures.

• Aspirational products and services are finding many takers.

Tier 2, Tier 3 cities offers a huge opportunity due to urbanization, rising income and awareness in these cities

Key success factors for the Industry: Location, availability of quality gym equipment, range of add‐on facilities, skills and experience of gym staff, membership pricing and club ambience are some of the key success factors in the industry. A fitness club taking care of all these factors can expand its membership base very rapidly.

Location: A dominant driver for gym selection is convenience of location. In fitness industry, a 15‐minute driving distance in metro cities is considered as the maximum anyone would travel for a gym. Hence, to target a particular locality, setting up a gym in near proximity is essential.

Facilities: Gym equipment like cardio, strength and free weights from reputed suppliers are an integral part of quality service offering. Additionally, basic facilities like separate area for warm up and free style exercise, locker rooms for customers and juice bars are necessary to create a differentiated product offering. Advanced facilities like aerobics, spas, spinning equipment, sauna bath, massage and personal training programs etc. can help attract more members as well as enhance revenues from existing members thus increasing profitability of the gyms.

Quality Gym staff: The most important success factor in a service industry is the quality of the service staff. It is essential that gym trainers are knowledgeable, experienced, have good communication skills and are soft‐spoken. In absence of any accrediting body for gym trainers and instructors, a customer is quick to form his own perception of the service levels at a particular fitness club. The ability of the local club management to maintain the service quality levels has a major impact on a club’s success.

Viral Marketing: In a locality with more than one gym, most people make a decision of which gym to join based on word of mouth recommendations by existing members who could be friends/families/acquaintances. Additionally, fitness industry has a very peculiar characteristic that enrolment often happens in groups of two or more, which could be either friends or relatives. Thus, service quality offered to existing members has a direct and major impact on future potential of garnering more memberships.

Price: Customers tend to look for best price and quality proposition. Typically, a young person in his early twenties would be ready to pay about Rs.12,000 p.a. while customers in the 30s and 40s would be ready to try the advanced facilities in a gym which would cost an additional Rs.2,000‐10,000.

Challenges for the Health & Fitness Industry:

Lack of Standardization The industry does not have established standards for the infrastructure facilities, trainer’s qualification, quality of services, type of equipment etc. There are no accreditation agencies in India for regulating the quality of service offerings being offered. Thus, the unorganized sector suffers from this customer perception of variable standards in service offering.

Lack of Accredited Training Institutes Industry is facing a shortage of properly trained and skilled professionals. There is no ready pool of trained staff available. This is a critical problem area in a service industry which relies on knowledge, expertise and good soft‐spoken skills of the gym staff.

High cost of Equipment India does not have quality equipment manufacturers. The duty structure on the imported gym equipment inflates the cost, which leads to higher service cost for the members. Thus, majority of the industry comprising of the unorganized gyms are not able to provide such world‐class equipment.

High real estate rentals/prices Real estate rentals/prices are increasing significantly, which makes it difficult to find a suitable location for the health club. This prevents a new entrant from ramping up and gaining scale very rapidly.

Lack of Government focus

Unlike in most developed countries, the sector doesn't have an industry status in India. There are no tax deductions for fitness center memberships in India. However, in some developed nations, the fitness center membership is tax‐deductible. Other nations such as the US are lobbying for it. Indian government doesn’t make a substantial allocation for investing in the preventive health of the people unlike in most developed countries where government sets community fitness centers, parks & recreational areas for physical activity.

Interesting Industry Trends:

Emerging Health clubs formats: Some players are planning to set up ‘only for women’ fitness centers. The concept of health clubs at the doorstep is also emerging. These clubs are located either in the residence or in the residential complex of the member. Fitness centers have also started renting the equipment and providing them personal trainers. The organized players are also experimenting with opening gyms in high footfall locations like a high street or a shopping/entertainment mall.

Focus on Corporate Sector: Some chains are also targeting the fitness needs of big corporate. Smaller corporates with fewer employees generally opt for corporate membership at the local health club, whereas larger corporates opt for an on‐campus fitness center, managed either by the professional gym staff or by the corporate client.

Peer influence: Fitness has become a fashion statement. Celebrities and sportsmen have played a vital role in creating awareness for a strong beautiful body and overall a healthier India. A larger audience is aspiring to be fit and identical of their role model‐ thus generating demand for more health clubs in the nation. Another trend which has picked up in recent times is competing on the physical fitness front with peers. This is creating a need for more niche fitness services and demand for personal training.

Other factors: Poor health & fitness conditions of the general public at large, combined with a heightened national emphasis on daily exercise for good fitness have been key contributors to high health club penetration rates in several countries. To give an idea, anti‐diabetic medications form a whopping US$21bn pa market globally. Daily exercise and healthy diet can substantially bring down this healthcare spends. Lifestyle related diseases are restricted not just to the developed markets. Even developing nations face a mounting risk of large number of people suffering from diseases like diabetes. For instance among the BRIC nations, China is staring at a massive accumulated income losses of USD 558bn for 2005‐15.

Country Estimated income loss ‐

2005 (USD bn) Estimated income loss ‐

2015 (USD bn)Accumulated loss 2005‐15(in 2005 value) (USD bn)

China 18.3 131.8 557.7

Russia 11.1 66.4 303.2

India 8.7 54 236.6

Brazil 2.7 9.3 49.2

Source: World Health Organisation, World Economic Forum

Although diabetes per se is not the highest contributor to healthcare spends around the world, it is important, since it can lead secondarily to several of the other lifestyle diseases, including coronary artery disease. The concern of the Chinese population to these statistics already reflects in its membership penetration rates. Interestingly, India is following a similar trajectory in potential income losses due to unhealthy lifestyle. Yet, Indian penetration rates are lower than even the Asia‐Pacific average. Total membership in India is only 0.41 million members compared to 3.5 million in China. As the realization mounts on Indian population of the various healthcare related costs, more people are expected to enroll into a fitness club and the penetration rates would thus inch up. The organized players in India are set to grab major share of the expanding market with their focus on product differentiation, qualified personal trainers and professional managers.

VI. BRIEF HISTORY OF ISSUER SINCE INCORPORATION, DETAILS OF ACTIVITIES INCLUDING ANY REORGANIZATION, RECONSTRUCTION OR AMALGAMATION, CHANGES IN CAPITAL STRUCTURE, (AUTHORIZED, ISSUED AND SUBSCRIBED) AND BORROWINGS

OUR BUSINESS: We are one of the largest fitness chains in India offering a diverse suite of services in fitness including gyms, spas, aerobics and health counseling under the brand “Talwalkars”. “Talwalkars” has pioneered the concept of gyms in India and today is a recognized name in the health and fitness industry. The first gym was setup in the year 1932 by late Mr. Vishnu Talwalkar in Mumbai. Mr. Madhukar Talwalkar, eldest son of late Mr. Vishnu Talwalkar, carried on with the legacy and started his first gym in Bandra, Mumbai by the name “Talwalkars Gymnasium”. Mr. Madhukar Talwalkar has been instrumental in creating the brand “Talwalkars” over the past several decades. Our Company, Talwalkars Better Value Fitness Limited, was co‐promoted in the year 2003 by the Talwalkars Group and the Gawande Group with the object of developing “Talwalkars” brand as a leader in gyms. Through the industry expertise of Mr. Madhukar Talwalkar and guidance of our co‐promoters namely, Girish Talwalkar, Prashant Talwalkar, Vinayak Gawande, Anant Gawande and Harsha Bhatkal, we have enhanced our brand equity and pan‐India presence. As on December 31, 2014, there are 150 Fitness Centers operating under our registered trade name “Talwalkars”, in 78 cities across 20 states of the country serving over 145,000 members. These 150 Fitness Centers comprise of 96 gyms owned and operated by us, 16 gyms owned and operated by our Subsidiaries, 13 franchisees & licensed gyms, 17 HiFi gyms and 8 NuForm exercise studios. We are rolling out gyms under the brand “Healthy India Fit India” (“HiFi”) since we believe that there is a lot of potential for an affordable gym facility in Tier 3 and Tier 4 cities and some congested pockets in larger cities. The HiFi gyms in smaller formats is aimed to enable us enter into Tier 3/Tier 4 cities where the full service “Talwalkars” brand is not present, as well as selectively rollout this format in Metro and Tier 1/Tier 2 cities to further enhance our existing presence. We constantly strive to offer innovative fitness solutions and in this pursuit we have widened our offerings in fitness. After setting up the hub and spoke model for Talwalkars gyms and rolling out HiFi gyms, we have undertaken further initiatives in the areas of health and fitness. As on December 31, 2014, we have introduced Reduce program in 43 of our gyms. As on date of this Placement Document we have 48 products in our Reduce weight loss program. In the current Fiscal, we have introduced Transform, a new combination package bringing together NuForm and Reduce. A brilliant and effective platform to speedy transformation, this package perfectly blends together weight loss and muscle toning to deliver overall fitness. Transform is a unique weight loss and fitness model, uniting the benefits of weight training and calorie burning. It affords the member luxury of time and convenience. NuForm and Reduce effortlessly complement each other by restricting unwanted calorie intake and burning of calories through and active form of exercise, equivalent to 4‐5 days of gym workouts. Following this routine increases the metabolism rate consequently facilitating body toning and weight loss. Transform is currently available in the 8 NuForm studios and also is provided as an online service. In our pursuit to become a holistic fitness player we are broadening our scope of fitness solutions to our customers, be it in the form of gymming, dietary counseling, PEP training, aerobics, spas, NuForm exercise studios, Reduce and now Transform. This has distinguished us as a market leader with a strong brand to provide health and fitness solutions to all categories of customers across all borders of age and gender. We have demonstrated a consistent growth in our business and profitability. We have doubled the number of our gyms and the number of members we serve over the last four years. Our Income from Operations (Net) on a standalone basis grew at a 3 year CAGR (FY12‐ FY14) of 27.23% achieving Rs.1610.12 million during Fiscal 2014. Similarly, our EBITDA and Profits After Tax on a standalone basis for the year ended March 31, 2014, were Rs.806.30 million and Rs.334.03 million respectively, growing at a 3 year CAGR (FY12‐ FY14) of 33.78% and 31.91% respectively. For the nine months period ended

December 31, 2014, our standalone Income from Operations (Net) was Rs.1361.94 million, our EBITDA and Profits After Tax were Rs.691.28 million and Rs.260.63 million respectively. Our Income from Operations (Net) on a consolidated basis grew at 24.44% on y‐o‐y basis achieving Rs.1872.74 million during Fiscal 2014 as compared to Rs.1508.52 million in Fiscal 2013. Similarly, our EBITDA and Profits After Tax after minority for the year ended March 31, 2014, on a consolidated basis were Rs.927.12 million and Rs.365.89 million respectively, representing a y‐o‐y growth of 27.76% and 21.76% respectively. For the nine months period ended December 31, 2014 our consolidated Income from Operations (Net) was Rs.1570.48 million, our EBITDA and Profits after Tax were Rs.784.71 million and Rs.281.92 million respectively. Our Competitive Strengths: We believe that the following are our principal competitive strengths which have contributed to our current position in the industry: Brand Equity Brand “Talwalkars” relates to the concept of gym in India. Late Mr. Vishnu Talwalkar, father of one of our promoters, Mr. Madhukar Talwalkar, had set up his first gym way back in 1932. Our Company owns this brand as its registered trade name since the year 2005. We believe the long existence of our brand and the strength of our brand equity enables us to stay ahead of the competition. Today, we are one of the largest fitness chains in India. Our brand “Talwalkars” is known for consistent, standardized and quality offerings and has a good brand recall which helps in breaking the competitive clutter within the industry. Market Leadership We are one of the largest fitness chains in India. We have grown rapidly since our inception and, as on December 31, 2014, we have 150 Fitness Centers in 78 cities across the country serving over 145,000 members. Our Company has its roots in the vision of our Promoter, Mr. Madhukar Talwalkar, who is associated with this industry for nearly five decades. Being a pioneer in the health and fitness industry, we enjoy a significant lead over our competitors. We believe that the above factors demonstrate our industry leading position which we can capitalize on to attract potential members and grow our revenues. Pan India Presence In a fragmented health and fitness industry, where the demand for quality services is high while the supply is largely unorganized (primarily from single city operators) and non‐standardized, we benefit immensely due to our pan India presence. Our Company has been able to achieve a country wide footprint, which we believe may be very difficult to replicate. We are currently present in 78 cities across 20 states of the country. And we believe our continuous expansion plans through Talwalkars and further through HiFi and NuForm brands will further enhance our brand visibility across the length and breadth of India. Diverse Service Offerings Over the years of our existence we have dominated and led the gymming business in India. In the process we have widened the fitness concepts into areas beyond gyms. We constantly innovate our offerings viz., we have spa facilities in 13 of our gyms, aerobics and spinning facility in 30 of our gyms. Additionally, we provide personal training program with dieticians working on weight management program, specialized fitness training programs and diet counseling. In our pursuit to become a holistic fitness player we are broadening our scope of fitness solutions to our customers, be it in the form of gymming, dietary counseling, PEP training, aerobics, spas and now NuForm exercise studios and Reduce. This has distinguished us as a market leader with a strong brand to provide health and fitness solutions to all categories of customers across all borders of age and gender. Standardized and Quality Offering In an unorganized and fragmented service industry with a large untapped demand, we provide quality service consistently across all our locations. One of the key investments in a gym is the fitness equipment. We maintain high quality standards by procuring our equipment from reputed international manufacturers, viz., Precor Incorporated and Johnson Health Tech Co. Limited from the USA for cardio and strength equipments; Rebar Investments Holding Limited from China for free weights; and Hoist Fitness Systems from USA for strength equipments, etc. Several key issues such as flooring, air conditioners, generator back up, wet area designs, etc. are benchmarked to a model gym and quality guidelines followed. We buy all these balance

equipment from reputed companies like Daikin and Toshiba (for Air Conditioners), Powerica (for Generator Sets), etc. Besides, we have a residential training academy at Thane where we offer a 4‐6 weeks induction training period for our trainers. This ensures that all the gym staff is trained to offer the same kind of services across all our locations. We believe that this “consistency” factor in providing quality service gives us a substantial edge in this competitive and unorganized market. Proven Track Record Over the last ten years of our existence we have consistently grown the number of gyms we operate to reach 150 Fitness Centers as on December 31, 2014. In fact, we have doubled our number of gyms and the number of members we serve in the last four years. By achieving this level of growth we have proved our expertise to enhance our presence and our ability to continue growing further from here, broadening our member base and revenues. Promoters’ experience and expertise We have an experienced promoter director team steering our Company. The Talwalkars Group has several decades of experience in the health and fitness industry. Mr. Madhukar Talwalkar has nearly 50 years of experience in operating a gym. He was the founder President of Greater Bombay Body Builders Association and is the current President of Maharashtra State Body Builders Federation. Similarly, Mr. Girish Talwalkar and Mr. Prashant Talwalkar both have also been associated with this industry for the last several years. The Gawande Group has vast experience in several areas of business including finance, marketing and legal. Our Company draws on this healthy blend of expertise to manage the challenges of growth effectively. Our Business Strategies: We intend to pursue the following strategies in order to consolidate our position and grow further:

Geographic Spread and Penetration We continuously explore attractive business opportunities in potential locations in pursuit of enhancing our geographic spread. We intend to increase our penetration in the country by setting up new gyms in cities where we already have presence, as also entering into new areas in the country. We believe there is a potential for growth in Tier 2, 3 and 4 towns. We have expanded our reach to several Tier 1 and Tier 2 cities and will continue entering newer markets to tap the opportunity strategically fit for us. In Fiscal 2012 we launched our small format HiFi gyms to tap the vast opportunity in Tier 3 and Tier 4 cities as well as to selectively rollout in Metro and Tier 1/Tier 2 cities to further enhance our existing presence. Affordability factor of a HiFi gym membership would benefit us from this market opportunity. Our strategy lies in achieving a distinct size and scale, covering the entire length and breadth of the country. Location Entry Strategy We have followed multiple market entry strategies to enhance our presence in the country, i.e. either directly, or through our Subsidiaries, or through franchisee route. There are 104 gyms which are owned and managed

by our Company, 16 are operated through our Subsidiaries, 13 are operate as franchisees & licensed gyms and 17 operate as HiFi gyms. Our preferred strategy is to enter a new market on our own, however, we are also constantly in lookout for partnering with strong local players in cities where we do not have presence. For instance, for our HiFi gyms, we are taking franchisee route. Hub & Spoke will continue to remain a strategy to enter newer locations and deepen our presence across India. We believe in having a nimble attitude in our gym rollout strategy to ensure profitability of both owned as well as franchised route. Continuous Broadening of Service Offerings We believe in keeping pace with current trends and overall customer satisfaction allowing us to attract more number of members and to increase revenue potential and retain existing members. In the current fiscal 2014‐15, we introduced Transform, new combination package bringing together NuForm and Reduce. A brilliant and effective platform to speedy transformation, this package perfectly blends together weight loss and muscle toning to deliver overall fitness. It is one of our core growth strategies to continue to innovate and explore opportunities to broaden our service offerings within the ambit of fitness industry. Our Business: We are one of the largest fitness chains in India offering a diverse suite of services including gyms, spas, aerobics and health counseling under the brand “Talwalkars”. “Talwalkars” has pioneered the concept of gyms in India and today is a recognized name in the health and fitness industry. As on December 31, 2014, we have 150 Fitness Centers in 78 cities across 20 states and serving over 145,000 members.

Out of the 150 Fitness Centers, 96 gyms are owned and managed by our Company, 16 are operated through our Subsidiaries, 7 are operated through our franchisees, 17 operate as HiFi gyms, 8 are NuForm exercise studios and there are 6 Trademark Licensed Gyms which are managed by our Promoter Group Entities (Mr. Madhukar Talwalkar, Mr. Girish Talwalkar, Mr. Prashant Talwalkar through their entities i.e. M/s Talwalkars (two gyms), M/s Talwalkars Health Complex (one gym), M/s Talwalkars Health and Leisure (two gyms), M/s Talwalkars Health Club (one gyms), M/s Life Fitness Private Limited (four gyms). These 6 gyms are spread in Mumbai. Our Service Offerings: We constantly work towards broadening our horizon of offerings across the spectrum of a Fitness industry. In the recent past, we have added services, viz.,Transform, NuForm exercise studios, Zumba® program and Reduce in our portfolio of offerings in our pursuit to transform from a Gym player to a Fitness player. GYM: The following chart depicts the broad set of services we offer through our Gym:

104

16

13

17

Own Subsidiaries Franchise & Licensed HiFi

We have a complete gym to help our customers achieve their fitness objectives. PEP Training: Over the past years in the health and fitness industry, we have consistently gone through a lot of research and improvisation to design health programs that target specific requirements of members. We have specialized programs such as Personal Exercise Program, Body Sculpting and Body Shaping to make our members achieve the desired results. Our team of experts analyses and exactly formulates the required programs for the members accordingly following the health standards. Personal Exercise Program (PEP) PEP is for those members who require individualized attention as well as workout on specialized equipment. We have a team of highly trained personal trainers who can cater to personal training regime of different individuals. A personal trainer is assigned to members who enroll for this program. The trainer motivates and encourages, without being forceful. The one‐to‐one attention creates a rapport between the member and the trainer, with the trainer being able to understand each member's limits and potential. The special attention paid by the personal trainer on this program gives motivation and encouragement, enhancing the result. Body Sculpting / Body Shaping Body Sculpting is drawn from the strengths of body building and Body Shaping is drawn from the advantages of cardiovascular exercises. Both of these are body transformation packages used for toning up one’s body muscles. Drawing heavily from techniques commonly used by body builders around the world, a carefully planned mix of resistance training and cardio exercise is what makes this program highly effective. A specific food supplement especially marketed for this program helps in boosting muscle power, and improves the performance during weight training. Besides the above, we offer fitness program for women, fitness program for aged over 45 years, fitness program for back problems, fitness program for cardiovascular problems, fitness program for diabetics, etc. based on individual requirements. Nutrition Center: The Nutrition Center is an inherent part of the gym. Under Nutrition Centers we offer specialized programs like Kiloburners, weight loss, weight maintenance and weight gain programs. It comprises 3‐6 qualified dieticians working in shifts. Dieticians not only cater to overweight, obese, and underweight cases, but also prescribe diets to customers with various health conditions like diabetes, heart diseases, hypertension, hypercholesterolemia, gout, etc. Dieticians, by way of diet counseling, effective diet planning and weight monitoring, motivate customers and guide them towards achieving their weight management goals. Weight Loss / Maintenance Program Talwalkars Nutrition Center provides a simple and effective way to lose weight, which includes daily diet counseling, gym, steam/sauna, etc. We offer two different programs i.e. weight loss which is to lose the amount of weight desired and weight maintenance which is to maintain the lost weight. The weight loss program ranges from the 5 kg ‐ 1 month plan to the 30 kg ‐ 8 month plan. The programs offered are decided

Personal Exercise Program

Body Sculpting / Shaping

Spa / Massage

Aerobics

Spinning

Weight Loss Program

Weight Gain Program

Kiloburner

only after a careful study of the customer including height, weight and medical history. In addition to its regular weight loss/maintenance program our Company has recently launched a new focused weight loss/maintenance program under a new brand called Kiloburner in some of the gyms. Kiloburner is a scientific weight loss program wherein a consulting team of experts assesses the physical condition of the client taking into account their habits, preferences and lifestyle; and chalks out a special diet‐n‐exercise plan for them while constantly monitoring their progress. It's the most safe and sensible way to get trim, and in just 3 months. There are various weight loss and weight management program under the Kiloburner brand suiting any duration and kilo loss as per the consumer’s requirement. Weight Gain Program It helps to gain weight, a healthy body and also to develop a good figure or physique. The program offers diet counseling, natural high protein power packed food supplement, massage and steam/sauna. The Nutrition Center not only brings the customer in shape but also reforms eating patterns and changes one’s attitude towards diet. Value add‐ons: In addition to the above, we offer other value added services as follows: Spa / Massage We entered a new line of activity by putting up a day spa. We offer therapeutic facilities and beauty correctional treatments at our spas. We also offer a variety of passive fitness regimes through Ayurveda, body touch, face touch and hair touch. Our fitness treatments are a suitable mix of gym, beauty and Ayurveda termed as “The Ayurveda Gym fitness regime”, one of its kind. Our skilled masseurs are also trained in giving head and face massage as well as Aroma Therapy sessions to make one feel revitalized and rejuvenated physically and mentally. Massage stimulates and peps up the entire nervous system, improves blood circulation and rejuvenates tired and aging skin. It also has an invigorating effect on the digestive system leading to better digestion and absorption. Aerobics The dance exercise popularly called 'Aerobics' is just one the moderate exercises, performed for extended periods of time, that increase one's heart and breathing rates. It confers many health benefits, apart from burning calories very effectively. We have introduced low impact aerobics, bench workout, circuit training, interval training and cross training. Spinning Spinning classes are done in a fitness studio, with various light and music settings to create an energized atmosphere. Instructors guide participants through workout phases like warm‐up, steady up‐tempo cadences, sprints, climbs and cool‐downs. Spinning is a relatively recent phenomenon, where participants take part in a group workout on exercise bikes that typically lasts anywhere from 30‐75 minutes. The classes are led by instructors who normally guide participants through a series of phases, from warm‐up to more challenging phases, to a period of peak effort followed by a cool down. Gym Formats: We operate gyms under different formats viz., the full service gyms rolled out under the Talwalkars brand either with our 100% ownership or through our Subsidiaries or through franchisees and HiFi, the gym format for deeper penetration and faster rollouts.

Gym Rollout Strategy‐ different gym formats for deeper penetration, faster rollout and capital efficiency:

As on December 31, 2014; TBVFL has a right to buy out all gyms operated through our Subsidiaries and 2 of our franchisee gyms; # TBVFL offers turnkey solution to its franchisee partners including for the set‐up of gym, equipment, staffing, etc. Talwalkars Full Service Gyms Our full service gyms typically occupy an average area of about 5,000 sq ft. A full service gym is divided into sections like the gym hall consisting of cardio facility, free weights, physical training, massage, steam/sauna, nutritional counseling, changing rooms with locker and juice bar. The target clientele for this full format gym are Metros, Tier 1 and Tier 2 cities. The entire capex for this concept is done by us. We have grown diametrically through this format with focus and control on quality maintenance and training. In certain geographies where we want to mark our presence and have immediate access, we partner a local franchisee or set up gyms through a 51% subsidiary approach. The capex is shared and we receive an incremental royalty for the management of the gyms and brand usage. This can help us enhance our EBITDA margins and increase RoCE. We also reserve the right to buy 5 of our gyms operated through our Subsidiaries and 2 of our franchisee gyms. HiFi Gyms Unlike a full service Talwalkars gym, a HiFi gym would typically be of smaller format, with an average area of about 2,500 sq.ft. A HiFi gym will have all the key facilities of a full service gym including imported fitness equipments, air‐conditioning, and generator back up, quality ambience and high quality personal trainers. A HiFi gym format enables us to enter Tier 3 and Tier 4 cities and some congested pockets in larger cities, depending on location and space availability. Considering these target destinations we decided to introduce this franchised small format gyms with no capex unlike the usual capex of a full service gym format. We collect an upfront fee and an annual royalty payment as an agreed share of these gyms’ revenues. With no capex and only franchisee income we aim to improve our RoCE. While it takes 14‐16 weeks to setup a Talwalkars gym, a HiFi gym would typically be rolled out in 8‐10 weeks from the time a gym site is finalized.

Gym Rollout Activity Flowchart: Setting up a full‐service gym is a two phase process. The planning phase involves finalizing of the site location. Once this is done, it typically takes 14‐16 weeks for setting up the gym.

Planning Phase

Planning phase involves identifying the city/town and shortlisting of a locality within the city for the proposed gym. A few critical parameters like income distribution, population density and demographic profile of the local area are studied. After a detailed feasibility study, the site in the chosen area is identified. Estimates of various revenue and cost items like lease rents for the premise, market demand, etc are made. A business plan capturing revenue, cost projections, breakeven time, etc. is submitted to the management for discussion. If the project looks viable, management gives an in‐principle approval and the execution phase begins. Execution Phase From the point the management gives an “in‐principle approval” for the site, it usually takes 14‐16 weeks to set up a gym.

Stage 1:

A1

A2

City and region/area identification for the proposed gym Feasibility study based on critical parameters

Site identification in the chosen city region Preparation of Business Plan – Revenue projections, Costing (lease rent, physical infrastructure etc.) In-principle management consent

Gym Rollout Flowchart - Planning Phase

A1

A2

City and region/area identification for the proposed gym Feasibility study based on critical parameters

Site identification in the chosen city region Preparation of Business Plan – Revenue projections, Costing (lease rent, physical infrastructure etc.) In-principle management consent

Execution phase begins with a few critical actions initially. A detailed due diligence is done on the identified site. Clear title and permissions/conformance with various local laws for conducting business is verified. Terms and conditions of the lease agreement are negotiated. After the management gives a final consent, lease agreement is signed and deposit payment is made. Stage 2: Several processes occur simultaneously at this stage: An Architect is appointed who finalizes the designs for the club layout. Contractors for job work are appointed after evaluating quotations from few vendors. Sourcing of Equipment: Orders are placed for gym equipment like cardio, strength and free weights. We source gym equipment from reputed international manufactures like Precor Incorporated, Hoist Fitness Systems, Johnson Health Tech Co Limited, Rebar Investments Holding Limited ensuring quality of international standards. Process of receiving utility connections is initiated. Stage 3: Typical expected time for shipping of equipment and completion of construction is about 7‐8 weeks. Towards the end of this period, other accessories like balance of gym equipment, generators, air conditioners etc are also ordered. Recruitment and Training and Promotional Activities are two most important activities in this stage. Recruitment and Training: Recruitment and Training for a new gym is about six week process. All new recruits undergo intense six week training at our residential academy in Thane. A gym would typically have general trainers as well as operational staff like branch manager and accountants. Our Company recruits local people for its trainers and operational staff requirements and train them before employing them in the gym. Apart from this, a gym can have several experts including cardio trainer, personal trainer, dietician, fitness expert, masseur, aerobics instructor, spa therapist and yoga trainer. Our gyms are usually open from 6am to 10pm. Trainers and fitness experts are employed in two shifts. Branch managers and other operational staff work on an 8 am to 6 pm shift. The total staff requirement for a gym can vary from 35‐40 people. Promotional Activity: Launch related promotional activities begin in this period. Awareness about the gym launch in the neighborhood is built through various media like newspaper inserts and poster/banners. Once the above activities are completed, it is ensured that all the relevant business licenses according to the local by‐laws are in place. Gym equipment are installed and tested for smooth operating conditions before the gym is open for rendering services. Strategy to remain competitively ahead:

Our new initiatives in fitness suite:

Transform Transform is a new combination package bringing together NuForm and Reduce. A brilliant and effective platform to speedy transformation, this package perfectly blends together weight loss and muscle toning to deliver overall fitness. Transform is a unique weight loss and fitness model, uniting the benefits of weight training and calorie burning. It affords the member luxury of time and convenience. NuForm and Reduce effortlessly complement each other by restricting unwanted calorie intake and burning of calories through and active form of exercise, equivalent to 4‐5 days of gym workouts. Following this routine increases the metabolism rate consequently facilitating body toning and weight loss. NuForm We launched NuForm exercise studios wherein we introduced fitness program using the EMS technology. EMS technology targets to improve BMR muscle formation and strengthening and weight loss. NuForm exercise studios offer the EMS method of working out. It is a machine assisted dynamic form of activity, that not only helps to strengthen and tone muscles but leads to a long term exercise habit. In EMS method of working out all muscle groups are targeted at the same time thus reducing the amount of time spent on the workout. EMS method of work out trains all the muscle group in 20 minutes, just once a week. In addition, it gives the member a great mind‐body connection, training both muscular system and establishing a better neural connection to muscle fiber. NuForm exercise studios are set up in affluent areas with very high visibility of Tier 1 cities. Typically set up in an average area of about 750 sq.ft, these studios have tasteful ambience and deploy EMS technology machines. Each studio will have 2‐3 EMS machines along with nutrition counseling room. Unlike a gym, a customer has to work out just 20 minutes a week to get the same level of workout. This will help us to target that category of people which feel that there is not enough time for workout in a gym or have health and aging related issues. The staff is trained for four weeks in our training academy for both operational as well as soft skills required for handling the customers. Zumba® Fitness Program Our Company vide its corporate announcement made to the Stock Exchanges in June 2012 has informed the launch of Zumba® Fitness Program, a dance inspired fitness program. Zumba® Fitness Program is introduced by a Miami‐based Zumba® Fitness LLC, the largest branded fitness program in the world. This program is a muscle strengthening, full‐body cardio, body toning, and stress relieving fitness dance style. We plan to launch this fitness program where we already have presence through our gyms in a phased manner but also through schools, auditoriums, halls and company locations. Reduce Program As a part of the nutrition program we also provide special weight reduction program through controlled diet. “Reduce” is a personalized weight loss program using diet meals, which tackles weight issue without having to starve, do strenuous workout or spend time on making specific recipes. This program aims at providing an easy way to reduce weight without compromising on health. As a part of the program every day we provide low calorie and high fiber based food products in our clients’ daily meal plans. These diet meals are provided with

carefully planned daily menus. Our dieticians draft the daily diet plan which targets to fuel the body with nutrients but keep hunger away, thereby, resulting to an effective weight loss.

TBVFL – transforming from a gym player to a fitness player

Talwalkars David Lloyd Leisure Consulting The company has entered in to a venture with David Lloyd Leisure Limited (UK), to leverage the opportunity to expand leisure and sports clubs in India. The joint venture, which will be known as Talwalkars David Lloyd Leisure Consulting, aims to provide consulting for leisure and sports clubs in high‐end residential developments, gated community townships and corporate campuses. The joint venture’s key areas of focus will be: consulting, execution, management and operations of leisure and sports clubs. David Lloyd Leisure limited (DLL) is Europe’s leading premium sports, health and leisure group. DLL has a unique sporting heritage and is renowned for its unrivalled health and fitness expertise, state of the art facilities and superior levels of service. The Group currently operates 81 premium David Lloyd Leisure sports, health and leisure clubs in the UK, as well as a further 10 clubs across Europe in Belgium, Holland, Spain and Ireland. David Lloyd Leisure has 30 years’ worth of unparalleled expertise and strategic knowledge on costs, implementation and execution of premium health clubs. Geographic Spread and Penetration: We have grown rapidly since our inception and, as on December 31, 2014, we have 150 Fitness Centers in 78 cities across 20 states of the country serving over 145,000 members.

The detailed breakup of our presence is as given below: Tier‐wise distribution Region‐wise presence

We believe that there is considerable pent‐up demand in Metros and Tier 1 cities and we continuously try to tap this lucrative business opportunity through our full‐service Talwalkars gyms. We will also penetrate aggressively into Tier 2/Tier 3 cities and select city suburbs through HiFi gyms to expand our network and make quality fitness affordable in these areas. Today, we have covered the length and breadth of the country and this reflects in as set out in the map below:

*as on December 31, 2014; Note: Cities highlighted in bold (red) have more than 1 gym; above Map is not to scale and not intended to mean political map of India Our proven success in all the locations where we have presence has further strengthened our belief that we should replicate our business model and take our fitness centers to other cities in India. We believe that the strength of our brand coupled with our quality facilities offered at the right price point would help us penetrate into markets newer to us and we are in a position to implement our Hub & Spoke model to its complete advantage.

37%

39%

24%Tier 3 Tier 1

Tier 2

5%

44%

26%

25%

South

East

West

North

Agra

LudhianaPanchkula

Guntur

Amritsar

DehradunMerrut

Ghaziabad

Bareily

Ambala

Delhi/NCR

Ajmer

Aligarh

Allahabad

Faridabad

Ahmedabad

Anand

Aurangabad

Bengaluru

Belgaum

Bhavnagar

Bhopal

BhubaneswarBhilai

Bhimavaram

Calicut

Bilaspur

Ranchi

Chennai

Cochin

Coimbatore

Gandhinagar

Kakinanda

Nellore

Guwahati

Gwalior

HubliVijayawada

HyderabadIchalkaranji

Indore

Jabalpur

Jaipur

Jalandhar

Kolkata

Jamshedpur

Kolhapur

Jamnagar

Jodhpur

Kota

Lucknow

Madurai

Mangalore

Thane, Mumbai &

Navi Mumbai

Mysore

Nagpur

Noida

NandedPune

Raipur

Rajkot

Rajahmundry

SangliSecunderabadSholapur

Surat

Trichy

Thiruvananthapuram

Udaipur

Ujjain

Varanasi

Vishakhapatnam

Moradabad

Jalgaon

Pondicherry

Nasik

Goa

Latur

Proven Track Record The execution cycle of a gym comprises of several activities in close coordination. Negotiation with architects, contractors, equipment suppliers, etc is conducted almost on a simultaneous basis. Recruitment, training, promotional activities, etc, follow in constricted timelines. Speed and execution capabilities are of utmost essence in executing several gyms at the same time. Our management team has consistently proven its superior execution track record, which is evident from the number of gyms that we have rolled out in the past couple of years. The following charts exhibits our growth track record of our gyms and the members we serve: Gym rollout – Track Record*

*as on December 31, 2014

*till December 31, 2014 Growth in No. of Members* Statistics #as on December 31, 2014

Zone No. of Gyms#

North 39

East 8

West 66

South 37

Grand Total 150

23 3042

5463

94

115

135149

712

12

9

31

21

20

141

0

15

30

45

60

75

90

105

120

135

150

FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Q3FY15

Additions

Beginning of the year

CAGR 22.3%

2938

55 59

83

120

133135

145

0

20

40

60

80

100

120

140

160

180

FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15*

Members ('000)

CAGR 22.28%

Sr. No. States No. of Gyms Sr. No. States No. of Gyms

1 Andhra Pradesh 15 11 Madhya Pradesh 6

2 Assam 1 12 Maharashtra 54

3 Chattisgarh 3 13 Orrisa 1

4 Delhi 2 14 Pondicherry 1

5 Goa 1 15 Punjab 4

6 Gujarat 11 16 Rajasthan 9

7 Haryana 3 17 Tamil Nadu 9

8 Jharkhand 2 18 Uttar Pradesh 11

9 Karnataka 9 19 Uttaranchal 1

10 Kerala 3 20 West Bengal 4

Grand Total 150

Ownership Wise No of Gyms

Owned 104

Subsidiaries 16

Franchise & Licensed 13

HiFi 17

Grand Total 150

Sr. No.

City No. of Gyms

Sr. No.

City No. of Gyms Sr. No. City No. of Gyms

1 Agra 1 27 Goa 1 53 Mumbai 33

2 Ahmedabad 5 28 Guntur 1 54 Mysore 1

3 Ajmer 1 29 Guwahati 1 55 Nagpur 2

4 Aligarh 1 30 Gwalior 1 56 Nanded 1

5 Allahabad 1 31 Hubli 1 57 Nasik 1

6 Ambala 1 32 Hyderabad 7 58 NCR 2

7 Amritsar 1 33 Ichalkaranji 1 59 Nellore 1

8 Anand 1 34 Indore 2 60 Noida 1

9 Aurangabad 1 35 Jabalpur 1 61 Panchkula 1

10 Bangalore 5 36 Jaipur 5 62 Pondicherry 1

11 Baraeily 1 37 Jalandhar 1 63 Pune 10

12 Belgaum 1 38 Jalgaon 1 64 Raipur 1

13 Bhavnagar 1 39 Jamnagar 1 65 Rajkot 1

14 Bhilai 1 40 Jamshedpur 1 66 Rajmundhry 1

15 Bhimavaram 1 41 Jodhpur 1 67 Ranchi 1

16 Bhopal 1 42 Kakinada 1 68 Sangli 1

17 Bhubhaneshwar 1 43 Kolhapur 1 69 Secunderabad 1

18 Bilaspur 1 44 Kolkata 4 70 Solapur 1

19 Calicut 1 45 Kota 1 71 Surat 1

20 Chennai 6 46 Latur 1 72 Trichi 1

21 Cochin 1 47 Lucknow 2 73 Trivandrum 1

22 Coimbatore 1 48 Ludhiana 1 74 Udaipur 1

23 Dehradoon 1 49 Madurai 1 75 Ujjain 1

24 Faridabad 2 50 Mangalore 1 76 Varanasi 1

25 Gandhinagar 1 51 Meerut 1 77 Vijaywada 1

26 Ghaziabad 1 52 Moradabad 1 78 Vizag 1

Grand Total 150

Other Initiatives: Talwalkars Training Academy We have established a 25,000 square feet training academy at Thane in the year 2009, in order to impart training to our fitness trainers both newly recruited as well as the existing staff. The course duration typically ranges from 30 days – 45 days. A significant part of the training is focused on the nuances of fitness, incorporating both practical and theoretical aspects covering weight training, cardio vascular fitness, special cases and nutrition. On the job training is provided to the recruits at various gyms after completion of the theory classes at academy. We have plans to transform the academy into a profit center by providing fitness certification courses to the outside trainees for a fee. We have 10 residential flats adjoining this academy to accommodate 40‐60 recruits at a time during the course duration.

Corporate Segment We have started focusing on tapping the revenue potential from the corporate segment recently. Many corporate are increasingly focusing on ensuring general wellness of their employees. This concern is addressed by way of having dedicated on‐campus gym or indoor sports section. Smaller corporate premises which do not have these facilities on campus are looking at subscribing to corporate membership schemes in our various fitness centers. To tap this segment, we have set up a dedicated corporate sales team which deals with such clients on a pan‐India level. We can leverage our pan‐India network to cater to these corporate clients who could be sitting out of multiple locations in India. This new initiative has gathered pace and we have seen interest from prestigious clients. Marketing and Advertising We are constantly looking for opportunities to promote our brand on a nationwide platform. Our Company launched several marketing promotional campaigns viz. New Year Scheme, Valentines Scheme, Women’s Day Scheme and Annual August Scheme 2014. Talwalkars also introduced new products to help consumers stay fit and lose weight through NuForm exercise studios and Reduce diet plan and also a newly introduced combo package named Transform. In a country with estimated 100 million internet users, Talwalkars has taken various initiatives in digital marketing, Social media marketing. Our Company is active on various social media platforms like Facebook, Twitter and YouTube. We have also explored various mediums like Webinars, Google, Wikipedia and Blogs to create awareness and promote the various offering among people. In future, we continue to look out for similar regional or national campaigns and events which can give us a stage to showcase our brand across the country. We have, from time to time, carried out mega promotional campaigns. We are associated with national/state events with focus on brand building, to name a few: Sponsorship and stall at 6th World Body Building & Physique Sports Championship

Online Initiatives like alliance with 6th Street Yogurt, Mills and Boon and Harlequin India .

Losers Challenge 2014 was organized by Talwalkars Better Value Fitness Ltd

Social Initiatives carried out by Talwalkars Better Value Fitness Ltd like World Environment Day, World Health

day, World Heart Day, World Diabetes Day, Anti Obesity Day.

Talwalkars Classique 2013 organized by Talwalkars Better Value Fitness Ltd and Maharashtra Body Building

Association, under the aegis of Indian Body Builders Federation

Pinkathon – Run to lead 2012

Ms. Hyderabad beauty pageant, held in October 2011.

Talwalkars Kingfisher Calendar Girls Event in 2011

Co‐branding activities with various corporates including Britannia Nutri Choice, RCom, Café Coffee Day in Fiscal

2011

“Official Trainer” for “Standard Chartered Mumbai Marathon” for the year 2008, 2009 and 2010.

“ Official Fitness Partner” for “Femina Miss India Contest” 2009

Our Subsidiaries Step‐down Subsidiary Wholly‐Owned Subsidiary

66.67%

Denovo Enterprises Pvt. Ltd. (50.10%)

Aspire Fitness Pvt. Ltd. (50.001%)

Equinox Wellness Pvt. Ltd.

Jyotsna Fitness Pvt. Ltd. (50.02%)

TBVFL Subsidiaries

Talwalkars Club Pvt. Ltd. (100%)

A. Subsidiaries: Denovo Enterprises Private Limited (“Denovo”) Our Company and Palestra Enterprises Limited (“Palestra”) held 50% equity shares each in the joint venture company, Denovo, incorporated pursuant to Memorandum of Understanding (MoU) dated November 14, 2005 and Shareholders Agreement dated August 10, 2006 between our Company, Palestra, Ms. Apurva Shanghavi, Mr. Rajesh Mehta and Mr. Vipul Doshi. Denovo became our Company’s subsidiary vide approval of the Board of Directors held on October 28, 2010. As on the date of this Placement Document our Company holds 50.10% equity stake in Denovo. As on December 31, 2014, Denovo operates six gyms i.e. one each in Indore, Jamnagar, Bhavnagar, Gandhinagar and two in Jaipur. Equinox Wellness Private Limited (“Equinox”) Equinox became our step down subsidiary with effect from October 28, 2010, following increase in our equity holding in Denovo. As on date of this Placement Document, Denovo holds 66.67% of equity shares in Equinox. As on December 31, 2014, Equinox operates one gym in Kolkata. As per the terms of the Share Subscription Agreement dated August 24, 2006, Denovo shall have the right to buy equity shares held by other shareholders in Equinox at any time. Aspire Fitness Private Limited (“Aspire”) Aspire was incorporated pursuant to Memorandum of Understanding dated November 5, 2009 (MoU) and Shareholders Agreement dated April 26, 2010 (SHA) between our Company and Life Fitness India Private Limited (“LFIPL”) as joint venture company with 50% equity stake between Company and LFIPL each. Aspire became our Company’s subsidiary vide approval of the Board of Directors granted in the meeting held on October 28, 2010. As on the date of this Placement Document our Company holds 50.001% equity stake in Aspire. As on December 31, 2014, Aspire operates 6 gyms in Pune. As per the terms of MoU and SHA, our Company shall have the right to acquire shares from LFIPL in Aspire in full or in part at the sole discretion of our Company on March 31, 2013. Jyotsna Fitness Private Limited (“Jyotsna”) Jyotsna was incorporated on July 05, 2011 with Mr. Vishwas Shinde and Mrs. Jyotsna Shinde as the original shareholders. Jyotsna became a subsidiary of our Company vide board resolution dated November 14, 2011. As on the date of this Placement Document our Company holds 50.02% equity stake in Jyotsna. As on December 31, 2014, Jyotsna operates 3 gyms i.e. one gym each in Nanded, Jalgaon and Mumbai

Talwalkars Club Private Limited (“TCPL”) TCPL was incorporated on March 21, 2014 as Wholly Owned Subsidiary of Talwalkars Better Value Fitness Limited. TCPL became wholly‐owned subsidiary of our Company vide board resolution dated 8th May, 2014. TCPL would be setting up a sports and recreation health club in Pune offering activities like Gym, Sports training, Swimming Pool, Racquet Sports, Restaurant/F&B, Banquet Hall, and Entertainment Zone. With the parent entity TBVFL engaged in operating fitness centres, catering to lower and middle income group through its large format and affordable gyms (HiFi Franchisees), TCPL is a logical extension from fitness centres to health and recreation centres for the Talwalkars Group. As on date of this Disclosure Document our Company holds 100% equity stake in TCPL. Human Resources Our employees are key contributors to the success of our business. We have a residential training academy at Thane, where all our potential gym staff undergoes intense six week training in soft skills and service delivery. We view this process as a necessary tool to maximize the performance of our employees. We have policy of hiring fresh graduates. Our workforce consists of (i) permanent employees, (ii) contractual staff and (iii) fitness experts. Permanent Employees: We have core team of managers which is involved in identifying potential new locations and overall project management of the expansion projects. We conduct periodic reviews of our

employee’s job performance and determine salaries and discretionary bonuses based upon these reviews. In addition, we offer internal training programs tailored to different job requirements to enhance our employees’ talents and skills. As on December 31, 2014 we have 16 permanent employees. Contractual Staff: The staff at the gym is on the payrolls of various agencies with whom we have exclusive arrangement for sourcing the manpower. All the general trainers and operational managers are sourced from these agencies. Our Company offers an incentive by way of certain percentage of revenues on the achievement of targets by the branch staff. Reputed hospitality service providers are engaged to maintain good ambience and hygiene in our fitness centers. As on December 31, 2014 we have about 3561 contractual staff. Fitness Experts: We also utilize the services of professionals for add‐on services like spa, massage and personal training, etc. on revenue sharing basis. Our Company does not pay them a fixed salary, but shares with them a certain percentage of the fee charged to a customer. As on December 31, 2014 we have about 2283 fitness experts.

(i) Details of acquisition or amalgamation in the last one year: NIL

(ii) Details of reorganization or reconstruction in the last one year: NIL (VI) SHARE CAPITAL STRUCTURE (as on December 31, 2014)

Particulars Amount (Rs. In Lacs)

1. AUTHORIZED SHARE CAPITAL:

30,000,000 Equity Shares of Rs.10/‐ each 3,000.00

2) ISSUE OF SUBSCRIBED AND PAID UP CAPITAL :

2,61,80,888 Equity Shares of Rs.10/‐ each fully called up

2,618.08

1. SHARE CAPITAL HISTORY Equity Share Capital:

Date of Allotment of fully Paid‐up Equity Shares

No. of Equity Shares Allotted

Cumulative number of shares

Face Value (Rs.)

Securities Premium (Rs.)

Issue Price (Rs.)

Nature of payment of consideration

Reasons for Allotment

Cumulative securities premium account (Rs. in million)

Cumulative paid ‐up capital (Rs. in million)

25‐Apr‐03 1,000 1,000 100 NIL 100 Cash Subscription to Memorandum

NIL 0.1

9‐Jun‐03 1,001 2,001 100 NIL 100 Cash Further Allotment

NIL 0.2

15‐Jul‐03 55,000 57,001 100 NIL 100 Other than cash **

Further Allotment

NIL 5.7

15‐Jul‐03 120,000 177,001 100 NIL 100 Cash Further Allotment

NIL 17.7

24‐Mar‐04 17 177,018 100 NIL 100 Cash Further Allotment

NIL 17.7

12‐Jan‐06 12,643 189,661 100 1481.9 1581.9

Cash Further Allotment

18.73 18.96

7‐Dec‐07 * 7,026 196,687 100 2120.3 2220.3

Cash Further Allotment against Redemption of Preference Shares

33.63 19.67

Sub‐division of nominal value of Equity shares of our Company from Rs. 100 per Equity Share to Rs. 10 per Equity Share vide AGM dated September 30, 2008.

5‐Oct‐09 291,339 2,258,209 10 625 635 Cash Further Allotment

215.71 22.58

16‐Nov‐09 15,807,463 18,065,672 10 NIL NIL Other than Cash

Bonus Issue 215.71 180.66

04‐May‐10 6,050,000 24,115,672 10 118 128 Cash Initial Public Offer

713.9 241.15

13‐Dec‐12 2,065,216 26180888 10 195.18 205.18

Cash Qualified Institutions Placement

1116.99 261.80

Preference Share Capital

Date of Allotment of the

preference shares

No. of preference shares

Cumulative Number of shares

Face Value

Issue Price

Securities

Premium

Nature of payment of consideratio

n

Reasons for

Allotment

Cumulative securities premium account

Cumulative paid ‐up

capital

(Rs.) (Rs.) (Rs. in Million)

12‐Jan‐06 156,000 156,000 100 100 NIL Cash Allotment of 0.1% Cumulative Convertible Preference Shares

NIL 1.56*

7‐Dec‐07* (1,56,000) 0 N.A. N.A. N.A. N.A. Converted into 7026 Equity Shares

NIL NIL

SHAREHOLDING PATTERN (as on December 31, 2014)

SI. NO

Category of Shareholder No. of shares held Shareholding as a % of Total no.

of shares

(A) Shareholding of Promoter and Promoter Group

1 Indian

(a) Individuals/ Hindu Undivided Family 12473240 47.64

(b) Bodies Corporate 7683 0.03

Sub‐Total (A) 1 12480923 47.67

2 Foreign (a) Individuals (Non‐ Resident Individuals/ Foreign Individuals) 0 0.00

(b) Any other (specify) 0 0.00

Sub‐Total (A) 2 0 0.00

Total Shareholding of Promoter and Promoter Group (A) 12480923 47.67

(B) Public shareholding

1 Institutions

(a) Mutual Funds/ UTI 1710935 6.54

(b) Financial Institutions/ Banks 34448 0.13

(iii) Holding of Promoters, Promoter Group and Persons Acting in Concert (PACs)of the Company as on

December 31, 2014:

Sr. No. (I)

Name of the shareholder

(II)

PAN of the Shareholder

(III)

Total Shares held Shares pledged or otherwise

encumbered

Details of warrants

Details of convertible securities

Total shares

(including underlying shares assuming

full conversio

n of warrants

& convertib

le securities) as a % of diluted share capital(XIII)

Number (IV)

as a % of grand total (A) + (B) + (C) (V)

Number (VI)

as a percentage (VII) = (VI) / (IV)*100

as a % of grand total (A) + (B) + (C) of sub‐clause (I)(a) (VIII)

Number of warrants held(XI)

As a % total number of warrants of the same class (X)

Number of convertible securities held (XI)

As a % total number of convertible securities of the same class (XII)

1 Prashant Sudhakar Talwalkar

AAAPT3528N 2876080 10.99 0 0.00 0.00 0 0 0 0 0

2 Girish Madhukar Talwalkar

AAAPT8175H 2864280 10.94 0 0.00 0.00 0 0 0 0 0

3 Madhukar Vishnu Talwalkar

AAAPT8172A 1332280 5.09 0 0.00 0.00 0 0 0 0 0

4 Anant Ratnakar Gawande

AABPG3008P 1920200 7.33 0 0.00 0.00 0 0 0 0 0

5 Vinayak Ratnakar Gawande

AABPG4476B 1920200 7.33 0 0.00 0.00 0 0 0 0 0

6 Harsha Ramdas Bhatkal

AACPB3100C 1560200 5.96 0 0.00 0.00 0 0 0 0 0

7 Better Value Leasing & Finance Ltd.

AAACB4410A 7683 0.03 0 0.00 0.00 0 0 0 0 0

TOTAL 12480923 47.67 0 0.00 0.00 0 0.00 0 0.00 0.00

(c ) Foreign Institutional Investors 2967434 11.33

Sub‐Total (B) 1 4712817 18.00

2 Non‐institutions

(a) Bodies Corporate 3092942 11.81

(b) Individuals

(i) Individual shareholders holding nominal share capital up to Rs. 1 lakh 1994321 7.62

(ii) Individual shareholders holding nominal share capital in excess of Rs. 1 lakh

2648629 10.12

(c ) Any Other 1251256 4.78

Sub‐Total(B) 2 8987148 34.33

Total Public Shareholding (B) 13699965 52.33

TOTAL(A)+(B) 26180888 100.00

(iv) A list of Top Ten Equity Shareholders (other than Promoters) of the Company as on December 31, 2014:

Sr. No. (I)

Name of the shareholder (II)

Total Shares held

Number

% of grand total

1 Prashant Sudhakar Talwalkar 2876080 10.99

2 Girish Madhukar Talwalkar 2864280 10.94

3 Madhukar Vishnu Talwalkar 1332280 5.09

4 Anant Ratnakar Gawande 1920200 7.33

5 Vinayak Ratnakar Gawande 1920200 7.33

6 Harsha Ramdas Bhatkal 1560200 5.96

7 SmallCap World Fund, Inc. 1694000 6.47

8 Laxmi Shivanand Mankekar and Kedar Shivanand Mankekar

1573520 6.01

9 Bajaj Allianz Life Insurance Company Limited 1080980 4.13

10

Reliance Capital Trustee Co Ltd‐A/C Reliance Monthly Income Plan

933816 3.57

VII. SUMMARY TERM SHEET

Issuer Talwalkars Better Value Fitness Limited

Issue Size Rs. 25 crores (Rupees Twenty Five Crores only)

Instrument Secured Taxable Redeemable Non‐Convertible Debentures

Issuance/ Trading In Demat Mode

Credit Rating Debenture to have a minimum investment grade of “AA‐” by CARE or from any other SEBI registered credit rating agency.

Rating Event In case of downgrade of the NCD from the Stipulated CARE AA‐ rating, the interest will increase by 25 bps on each notch downgrade. On further downgrade of the rating below “A” the interest will increase by 100 bps on each notch downgrade

In case of non‐agreement on the revised interest rate on NCDs by the Company, the debenture holder reserves the right to recall the outstanding debentures along with all outstanding interest dues.

Face Value Rs. 10,00,000/‐ per Bond

Issue Price At par (Rs. 10,00,000/‐ per Bond)

Redemption Price At par (Rs. 10,00,000/‐ per Bond)

Application Money The Issue Price i.e. Rs. 10,00,000/‐ per bond

Tenure 6 Years from the Deemed Date of Allotment

Put & Call Option At par at the end of 3rd year from the Deemed Date of Allotment

Redemption/ Maturity

3 equal installments at the end of the 4th , 5th and 6th year respectively.

Redemption Date 3 equal installments at the end of the 4th , 5th and 6th year respectively. ( depending on the opening of the issue )

Coupon Rate * 9.80% p.a. payable annually every year from the date of allotment on the outstanding amount of NCDs.

If any of the interest or principal payment dates is a holiday in Mumbai, interest will be payable on the next business day in Mumbai and Principal will be payable

on the Preceding business day in Mumbai and shall be the interest/principal payment date.

Interest Payment Annual from the date of allotment

Security First pari passu charge on the entire movable and immovable fixed assets and current assets of the company including Gymnasium equipments, furniture and fixtures and any other equipment installed in the Gymnasium.

The offered security to provide minimum asset coverage of 1.25 times during the tenure of the NCDs.

The company to provide the list of the offered security acceptable to the bank and also the latest valuation report of the same.

The company to create primary security in favor of trustees within 60 days from the date of first disbursement of funds. If security is not created within 60 days from the date of allotment, an additional interest of 2% p.a. (payable monthly) shall be payable by the company to the subscriber from the date of allotment till the date of actual security creation.

In case the company fails to create security within the stipulated time and no additional time is given, then the Debenture holder reserve the right to recall the debentures along with all outstanding and interest dues.

Listing The issuer shall get the NCDs listed on WDM segment of the BSE within 15 working days from the date of allotment.

In case of delay in listing of the debt securities beyond 15 working days from the date of allotment, the company will pay penal interest of at least 1% p.a. over the coupon rate from the expiry of 15 days from the date of allotment till the listing of such debt securities to the investors.

Trustee SBICAP Trustee Company Limited has been appointed by the Company to act as Trustees for and on behalf of the holder(s) of the NCDs

Depository National Securities Depository Ltd. and Central Depository Services (India) Ltd.

Registrars Link Intime India Private Ltd

Day Count Basis actual‐by‐365 days a year or in case of leap year the interest will be computed on ‘actual‐by‐ 366’

Settlement Payment of interest and repayment of principal shall be made by way of cheque(s)/ interest/ redemption warrant(s)/ demand draft(s)/ credit through RTGS system

Mode of Subscription Cheque(s)/ demand draft(s) may be drawn in favour of “Talwalkars Better Value Fitness Ltd” and crossed “Account Payee Only” payable at par at designated centers mentioned elsewhere in the Disclosure Document or remittance through RTGS as per details given in application form

Issue Opens on ^ 4th March, 2015

Issue Closes on ^ 4th March, 2015

Deemed Date of Allotment ^

4th March, 2015

^ TBVFL reserves its sole and absolute right to modify (pre‐pone/ postpone) the issue opening/ closing/ pay‐in date(s) without giving any reasons or prior notice. In such a case, investors shall be intimated about the revised time schedule by the TBVFL. The TBVFL also reserves the right to keep multiple Deemed Date(s) of Allotment at its sole and absolute discretion without any notice.

VIII. TERMS OF OFFER (DETAILS OF DEBT SECURITIES PROPOSED TO BE ISSUED, MODE OF ISSUANCE, ISSUE SIZE, UTILIZATION OF ISSUE PROCEEDS, STOCK EXCHANGES WHERE SECURITIES ARE PROPOSED TO BE LISTED, REDEMPTION AMOUNT, PERIOD OF MATURITY, YIELD ON REDEMPTION, DISCOUNT AT WHICH OFFER IS MADE AND EFFECTIVE YIELD FOR INVESTOR)

PRIVATE PLACEMENT OF SECURED TAXABLE REDEEMABLE NON‐CONVERTIBLE NCDS IN THE NATURE OF DEBENTURES OF RS. 10,00,000/‐ EACH FOR TOTAL FACE VALUE OF RS. 25 CRORES Issue Size Talwalkars Better Value Fitness Limited (“the Company”/ “the Issuer”) proposes to raise Rs.25 Crores through the issue of Secured, Taxable, Redeemable, Non‐Convertible Debentures of Rs. 10,00,000/‐ each for cash at par for total face value of Rs. 25 Crores by way of private placement (“the issue”). Governing Law & Provisions This present issue of NCDs is being made in accordance with extant statutory guidelines for floatation of NCDs as amended from time to time. The Issuer can undertake the activities proposed by it in view of the present approvals and no further approval from any government authority(ies) is required by the Issuer except those approvals which may be required to be taken in the normal course of business from time to time. Authority for the Placement The Issue is made pursuant to Clause 17 of the Memorandum of Associations of TBVFL and has been authorized by its Board of Directors vide resolutions passed at its meeting held May 8, 2014. The proposed NCD issue is within the overall borrowing limit approved in the Annual General Meeting of the shareholders of the Company held on September 18, 2014. TBVFL can issue the NCDs proposed by it in view of the present approvals and no further approvals in general from any Government Authority are required by TBVFL to undertake the proposed issue.

Objects of the Issue The proceeds of the issue would be utilized for general corporate purpose of the Company which is eligible for Bank Finance. The funds will not be utilized by the Company for subscription to or purchase of shares/ debentures, any speculative purposes, investment in real estate sector or any other capital market activities. The Company will provide the specific end use certificate obtained from its Auditors to the Debenture holder/ Debenture Trustee within 30 days from the closing date The expenses of the present issue would be met from the proceeds of the issue. The Main Object clause of the Memorandum of Association of the Company enables it to undertake the activities for which the funds are being raised through the present issue and also the activities which the Company has been carrying on till date. The proceeds of this Issue after meeting all expenses of the Issue will be used by the Company for meeting issue objects. Utilisation of Issue Proceeds The funds raised through this private placement are not restricted for any specific project as such and therefore the proceeds of this Issue shall be utilized inter‐alia for the General Corporate purposes of the Company. The Company is managed by professionals under the supervision of its Board of Directors. Further, the Issuer is subject to a number of regulatory checks and balances as stipulated in its regulatory environment. Therefore, the management shall ensure that the funds raised via this private placement shall be utilized only towards satisfactory fulfilment of the Objects of the Issue. Minimum Subscription As the current issue of NCDs is being made on private placement basis, the requirement of minimum subscription shall not be applicable and therefore the TBVFL shall not be liable to refund the issue subscription(s)/ proceed(s) in the event of the total issue collection falling short of issue size or certain percentage of issue size. Underwriting The present Issue of NCDs on private placement basis has not been underwritten.

Nature and Status of NCDs The NCDs are to be issued in the form of Secured Taxable Redeemable Non‐Convertible Debentures.

Face Value, Issue Price, Effective Yield for Investor Each NCD has a face value of Rs.10,00,000/‐ and is issued at par i.e. for Rs.10,00,000/‐. The NCDs shall be redeemable at par i.e. for Rs.10,00,000/‐ per Bond. Since the issue is at par, the effective yield for the investors shall remain at 9.80% p.a.

Credit Rating

Credit Analysis & Research Ltd. (CARE) has assigned a rating of “AA‐(Double A Minus)” to the current bond issue. This rating indicates high safety and issuer’s capacity for timely servicing of debt obligations.

Listing The Company has applied for an in‐principle approval from the Bombay Stock Exchange (BSE) for listing of current issue Secured Taxable Redeemable Non‐Convertible Debentures on its Wholesale Debt Market (WDM) Segment. The company shall make an application to the BSE to list the NCDs to be issued and allotted under this Disclosure Document and complete all the formalities relating to listing of the NCDs within reasonable time from the date of closure of the Issue. The issuer shall get the NCDs listed on WDM segment of the BSE within 15 working days from the date of allotment. In case of delay in listing of the debt securities beyond 15 working days from the date of allotment, the company will pay penal interest of at least 1% p.a. over the coupon rate from the expiry of 15 days from the date of allotment till the listing of such debt securities to the investors. Terms of Payment The full issue price of the NCDs applied for is to be paid along with the Application Form. Investor(s) need to send in the Application Form and the cheque(s)/ demand draft(s) for the issue price of the NCDs applied for.

Face Value per Bond Amount Payable on Application per Bond

Rs. 10,00,000/‐ Rs. 10,00,000/‐ Deemed Date of Allotment Interest on NCDs shall accrue to the NCD holder(s) with effect from, which shall be the Deemed Date of Allotment. All benefits relating to the NCDs will be available to the investors from the Deemed Date of Allotment. The actual allotment of NCDs may take place on a date other than the Deemed Date of Allotment. The Company reserves the right to keep multiple allotment date(s)/ deemed date(s) of allotment at its sole and absolute discretion without any notice. In case if the issue closing date is changed (pre‐poned/ postponed), the Deemed Date of Allotment may also be changed (pre‐poned/ postponed) by the Company at its sole and absolute discretion Letter(s) of Allotment/ Bond Certificate(s)/ Refund Order(s) Issue of Letter(s) of Allotment The beneficiary account of the investor(s) with National Securities Depository Limited (NSDL)/ Central Depository Services (India) Limited (CDSL)/ Depository Participant will be given initial credit within 7 working days from the Deemed Date of Allotment. The initial credit in the account will be akin to the Letter of Allotment. On completion of the all statutory formalities, such credit in the account will be akin to a Bond Certificate. Issue of Bond Certificate(s) Subject to the completion of all statutory formalities within 3 months from the Deemed Date of Allotment, or such extended period as may be approved by the appropriate authority(ies), the initial credit akin to a Letter of Allotment in the Beneficiary Account of the investor would be replaced with the number of NCDs allotted. The NCDs since issued in electronic (dematerialized) form, will be governed as per the provisions of The Depository Act, 1996, Securities and Exchange Board of India (Depositories and Participants) Regulations,

1996, rules notified by NSDL/ CDSL/ Depository Participant from time to time and other applicable laws and rules notified in respect thereof. Depository Arrangements The Company has appointed “Link Intime India Private Ltd, C‐13, Pannalal Silk Mills Compound, L.B.S Marg, Bhandup (West) Mumbai – 400 078, Tel :(022) 25946970, Fax No. (022) 2596 2691 as Registrars & Transfer Agent for the present NCD issue. The Company is in the process of making necessary depository arrangements with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) for issue and holding of NCDs in dematerialised form. In this context the Company will sign two tripartite agreements as under:

Tripartite Agreement between the Company, Link Intime India Private Ltd and National Securities Depository Ltd. (NSDL) for offering depository option to the investors.

Tripartite Agreement between the Company, Link Intime India Private Ltd and Central Depository Services (India) Ltd. (CDSL) for offering depository option to the investors.

Investors can hold the NCDs only in dematerialized form and deal with the same as per the provisions of Depositories Act, 1996 as amended from time to time.

Procedure for applying for Demat Facility

The applicant must have at least one beneficiary account with any of the Depository Participants (DPs) of NSDL or CDSL prior to making the application.

The applicant must necessarily fill in the details (including the beneficiary account number and Depository Participant’s ID) appearing in the Application Form under the heading ‘Details for Issue of NCDs in Electronic/ Dematerialised Form’.

NCDs allotted to an applicant will be credited directly to the applicant’s respective Beneficiary Account(s) with the DP.

For subscribing the NCDs, names in the application form should be identical to those appearing in the account details in the depository. In case of joint holders, the names should necessarily be in the same sequence as they appear in the account details in the depository.

The Registrars to the Issue will directly send non‐transferable allotment advice/refund orders to the applicant.

If incomplete/ incorrect details are given under the heading ‘Details for Issue of NCDs in Electronic/ Dematerialised Form’ in the application form, it will be deemed to be an incomplete application and the same may be rejected at the sole discretion of the Company.

For allotment of NCDs, the address, nomination details and other details of the applicant as registered with his/her DP shall be used for all correspondence with the applicant. The Applicant is therefore responsible for the correctness of his/her demographic details given in the application form vis‐à‐vis those with his/her DP. In case the information is incorrect or insufficient, the Issuer would not be liable for losses, if any.

It may be noted that NCDs being issued in electronic form, the same can be traded only on the Stock Exchanges having electronic connectivity with NSDL or CDSL. Bombay Stock Exchange where the NCDs of the Company are proposed to be listed has connectivity with NSDL and CDSL.

Interest or other benefits would be paid to those Bondholders whose names appear on the list of beneficial owners given by the Depositories to the Company as on Record Date/ Book Closure Date. In case of those NCDs for which the beneficial owner is not identified by the Depository as on the Record Date/ Book Closure Date, the Company would keep in abeyance the payment of interest or other benefits, till such time that the beneficial owner is identified by the Depository and conveyed to the Company, whereupon the interest or benefits will be paid to the beneficiaries, as identified, within a period of 30 days.

Investors may note that pursuant to circular no. SEBI/MRD/SE/AT/36/2003/30/09 dated September 30, 2003 issued by SEBI, the NCDs of the Company would be issued and traded only in dematerialised form. Market Lot The market lot will be one NCD (“Market Lot”). Since the NCDs are being issued only in dematerialised form, the odd lots will not arise either at the time of issuance or at the time of transfer of NCDs.

Trading of NCDs The trading of NCDs would be permitted in demat mode only in standard denomination of Rs.10 lakhs in the anonymous, order driven system of the stock exchanges in a separate trading segment. The marketable lot would be Rs.10 lakhs. All class of investors would be permitted to trade subject to the standard denomination/ marketable lot. The trades executed on spot basis shall be required to be reported to the stock exchange(s). Mode of Transfer of NCDs NCDs shall be transferred subject to and in accordance with the rules/ procedures as prescribed by the NSDL/ CDSL/ Depository Participant of the transferor/ transferee and any other applicable laws and rules notified in respect thereof. The normal procedure followed for transfer of securities held in dematerialized form shall be followed for transfer of these NCDs held in electronic form. The seller should give delivery instructions containing details of the buyer’s DP account to his depository participant.

Transfer of NCDs to and from NRIs/ OCBs, in case they seek to hold the NCDs and are eligible to do so, will be governed by the then prevailing guidelines of RBI. The transferee(s) should ensure that the transfer formalities are completed prior to the Record Date. In the absence of the same, interest will be paid/ redemption will be made to the person, whose name appears in the records of the Depository. In such cases, claims, if any, by the transferee(s) would need to be settled with the transferor(s) and not with the Company. Interest on the NCDs Interest on the NCDs are payable at the rate of 9.80% p.a. payable annually on the face value of the NCDs. Payment of interest on the NCDs will be made by cheque(s)/warrants(s) in the name of the Bondholder(s) whose name appear on the List of Beneficial Owners given by NSDL/ CDSL to the Company as on the Record Date. Interest warrants/ Cheques (net of any tax deducted at source, wherever applicable) will be mailed by registered post well before the relevant interest payment date. In due course, efforts shall be made to remit the amount of interest and redemption proceeds through ECS/ EFT. The Company’s liability shall extinguish upon dispatch of Interest Warrants by Registered Post and/ or remitting the interest proceeds through ECS/ EFT to the above said Beneficiaries. The Company shall not be responsible on account of postal delays, failure of bank’s systems, etc. Interest rate Reset: The interest rate on NCDs is subject to upward change. In case, the credit rating of the Debentures is downgraded from the current CARE rating of “AA‐”. The interest rate will be increase by 25 bps for each notch downgrade from the current credit rating. On further downgrade of the rating below “A” the interest will increase by 100 bps on each notch downgrade. In case of non‐agreement on the revised interest rate on NCDs by the Company, the debenture holder reserves the right to recall the outstanding debentures along with all outstanding interest dues.

Computation of interest

Interest for each of the interest periods shall be computed on an actual‐by‐365 days a year basis on the principal outstanding on the Debentures at the Coupon rate. In case of leap year the interest will be computed on ‘actual‐by‐366’, on the face value of principal outstanding on the Debentures at the respective coupon rate rounded off to the nearest Rupee. Record Date The ‘Record Date’ for the NCDs shall be 15 days prior to each interest payment and/ or principal repayment date.

Penal interest

The company will be required to pay additional 2% interest over and above the coupon rate from the date of first disbursement in case the company could not create security within stipulated period of 60 days as mentioned above. In case of default in payment in Interest, Additional Interest and/or Principal / non‐compliance of the documentation advised by the Trustees, an additional Interest @ 2% over the interest rate will be payable by the company for defaulting period. Deduction of Tax at Source Tax as applicable under the Income Tax Act, 1961, or any other statutory modification or re‐enactment thereof will be deducted at source. The investor(s) desirous of claiming exemption from deduction of income tax at source on the interest on application money are required to submit the necessary certificate(s), in duplicate, along with the Application Form in terms of Income Tax rules. Interest payable subsequent to the Deemed Date of Allotment of NCDs will be treated as “Interest on Securities” as per Income Tax Rules. NCD holders desirous of claiming exemption from deduction of income tax at source on the interest payable on NCDs should submit tax exemption certificate/ document, under Section 193 of the Income Tax Act, 1961, if any, at the Registered Office of the Company, at least 45 days before the payment becoming due. Regarding deduction of tax at source and the requisite declaration forms to be submitted, prospective investors are advised to consult their own tax consultant(s). However, Finance Act 2008 has inserted clause (ix) under the proviso to Section 193, which reads as under: “Any interest payable on any security issued by a company, where such security is in dematerialized form and is listed on a recognized stock exchange in India in accordance with the Securities Contracts (Regulation) Act, 1956 and rules made thereunder.” The amendment, which will be effective 1st June 2008, will have following implications: Tax will not to be deducted at source by the Company from interest paid on these debentures issued by the company, which are listed on the recognized stock exchanges and held in dematerialized form by investors.

Put/ Call Option The Put & Call option can be exercised at par by investor & Issuer at the end of 3rd year from the deemed date of allotment.

In respect of instruments issued with a ‘put’/or ’call’ option, the investor shall give notice to the Issuer of his intention to exercise the ‘put’ option at least one month but not exceeding two months before the ‘put’ option exercise date and the issuer shall give a notice of his intention to exercise the ‘call’ option at least one month but not exceeding two months before the ‘call’ option exercise date. Redemption The NCDs will be redeemed at par in three equal instalments starting at the end of 4th, 5th and 6th year from the date of allotment Events of Default The Trustee at its discretion may, and if so required in writing by the holders of not less than 25%. In principal amount of the NCDs then outstanding or if so directed by an Extraordinary Resolution shall (subject to being indemnified and/or secured by the NCD holders to its satisfaction), give notice to the Issuer that the NCDs are, and they shall accordingly thereby become, due and repayable at their Early Redemption Amount if any of the events listed below (each, an “Event of Default”) has occurred. Each of the following events shall be an Event of Default:

(i) Default is made in any payment of the principal or payment in respect of the NCDs or any of them when due. In case of default in redemption when due, the Issuer shall be liable to pay additional interest at 2% over and above the rate of 9.80% p.a. from the due date.

(ii) Default is made in any payment of any interest in respect of the NCDs or any of them when due and such failure continues for a period of 90 days. In case of default in payment of interest when due, the Issuer shall be liable to pay additional interest at 2% over and above the rate of 9.80% p.a. from the date of default.

(iii) The Issuer fails to create the security as identified in the Debenture Trust Deed after a period of 60 days after allotment or not meet the shortfall in security. In case of default in creation of security/ meeting the shortfall in security, the Issuer shall be liable to pay penal interest at the rate of 2% from the date of allotment till the date of creation/perfection of the security. If the company fails to create the security even after the due date and the investors decide to re‐call the investment/NCD along with all outstanding the company shall redeem the debentures of such investor within 30 days from the date of receipt of notice.

(iv) The Issuer does not perform or comply with one or more of its other obligations in relation to the NCDs or the Debenture Trust Deed which default is incapable of remedy or, if in the opinion of the Debenture Trustee capable of remedy, is not remedied within 30 days after written notice of such default shall have been given to the Issuer by the Debenture Trustee;

(v) the Issuer is (or is deemed by law or a court to be) insolvent or bankrupt or unable to pay (in the opinion of the Debenture Trustee) a material part of its debts, or stops, suspends or threatens to stop or suspend payment of all or (in the opinion of the Debenture Trustee) a material part of (or of a particular type of) its debts, proposes or makes any agreement for the deferral, rescheduling or other readjustment of all or (in the opinion of the Debenture Trustee) a material part of (or all of a particular type of) its debts (or of any part which it will or might otherwise be unable to pay when due), proposes or makes a general assignment or an arrangement or composition with or for the benefit of the relevant creditors in respect of any of such debts or a moratorium is agreed or declared in respect of or affecting all or any part of (or of a particular type of) the debts of the Issuer;

(vi) a distress, attachment, execution or other legal process is levied, enforced or sued out on or against any material part of the property, assets or revenues of the Issuer and is not discharged or stayed within 45 days;

(vii) an order is made or an effective resolution passed for the winding‐up or dissolution, judicial management or administration of the Issuer, or the Issuer ceases or threatens to cease to carry on all or substantially all of its business or operations, except for the purpose of and followed by a reconstruction, amalgamation, reorganisation, merger or consolidation on terms approved by an Extraordinary Resolution of the NCD holders;

(viii) an encumbrance takes possession or an administrative or other receiver or an administrator is appointed of the whole or (in the opinion of the Trustee) any substantial part of the property, assets or revenues of the Issuer (as the case may be) and is not discharged within 90 days;

(ix) the Issuer commences a voluntary proceeding under any applicable bankruptcy, insolvency, winding up or other similar law now or hereafter in effect, or consent to the entry of an order for relief in an involuntary proceeding under any such law, or consent to the appointment or taking possession by a receiver, liquidator, assignee (or similar official) for any or a substantial part of its property or take any action towards its reorganisation, liquidation or dissolution;

(x) It is or will become unlawful for the Issuer to perform or comply with any one or more of its obligations under any of the NCDs or the Debenture Trust Deed;

(xi) any step is taken by governmental authority or agency or any other competent authority, with a view to the seizure, compulsory acquisition, expropriation or nationalisation of all or (in the opinion of the Trustee) a material part of the assets of the Issuer which is material to the Issuer;

(xii) any event occurs which under the laws of any relevant jurisdiction has an analogous effect to any of the events referred to in any of the foregoing paragraphs.

(xiii) Debt Service Coverage Ratio below 1.25 times (xiv) Wilful defaulter/defaulter declared by lender to the company (xv) Non listing of NCDs within 15 days from the date of subscription of NCDs or delisting of NCDs during the tenure of NCDs

(i) Change in the control of the Company (caused by either the shareholding of the existing promoters in the Company going below the shareholding as at the time of sanction of the Facility or a change in the composition of the majority of the board of directors of the Company).

(ii) Failure to comply with the applicable regulations (as amended from time to time) pertaining to this

transaction including but not limited to requirements prescribed by Reserve Bank of India, Securities and Exchange Board of India or the Stock Exchange.

(iii) Disclosure in the default list of RBI/CIBIL/UNSCR/ECGC List. If any Event of Default or any event which, after the notice, or lapse of time, or both, would constitute an Event of Default has happened, the Issuer shall, forthwith give notice thereof to the Debenture Trustee in writing specifying the nature of such event of default or of such event.

The security created in favour of the Debenture Trustee under the Debenture Trust Deed shall become enforceable by the Debenture Trustee upon the occurrence of an Event of Default.

Settlement/ Payment on Redemption Payment on redemption will be made by RTGS/ cheque(s)/ redemption warrants(s) in the name of the Bondholder(s) whose name appears on the List of Beneficial Owners given by NSDL/ CDSL/ Depository to the Company as on the Record Date. The Issuer’s liability to Bondholder(s) towards all their rights including payment of interest or otherwise shall cease and stand extinguished from the due date of redemption in all events. Further, the Issuer will not be liable to pay interest, income or compensation of any kind from the date of such redemption of the NCDs. The NCDs shall be taken as discharged on payment of the interest and redemption amount by the Company. Such payment will be a legal discharge of the liability of the Company towards the Bondholders. On such payment being made, the Company will inform NSDL/ CDSL/ Depository and accordingly the account of the Bondholders with NSDL/ CDSL/ Depository will be adjusted.

The liability of the Company shall stand discharged on posting of redemption warrants by Registered Post and/ or remitting the redemption proceeds through ECS/ EFT to the above said Beneficiaries No claim, damages or penal interest in respect of delayed payment, etc. shall lie upon the Company in the event of non‐receipt of the same by the addressee Bondholder(s).

In case if the Redemption date falls on a day which is not a Business Day (‘Business Day’ being a day on which scheduled Commercial Banks are open for Business in the State of Maharashtra), then the payment due shall be made on the next Business Day together with additional interest for the intervening period. Security Pari passu charge on the entire movable and immovable fixed assets and current assets of the company including Gymnasium equipments, furniture and fixtures and any other equipment installed in the Gymnasium. The offered security to provide minimum asset coverage of 1.25 times during the tenure of the NCDs. The company to provide the list of the offered security acceptable to the bank and also the latest valuation report of the same before disbursement. Security Creation Security to be created within 60 days from the date of allotment or extended period as agreed by the Debenture Holders, the company shall, within 21 days thereafter, convene the meeting of the Debenture Holders to explain reasons for delay and seek an approval for extension. A penal interest of 2% will be payable from the date of allotment till the date of security creation/ perfection /shortfall in security, if the Company fails to create the security/meet shortfall in security within the stipulated time. In case the company fails to create the security even within the additional time, then the investors reserve the right to re‐call the Debentures, along with all outstanding and interest due. The company shall provide a certificate for Asset Cover at the end of each quarter by the Auditor of Company or a practicing Chartered Accountant Firm. Description of Security First Pari Passu Charge on entire movable and immovable Fixed Assets and Current Assets of the Company including gymnasium equipments, furniture and fixtures and any other equipment installed in the gymnasiums.

Effect of Holidays If any of the interest or principal payment dates fall on Sunday or a Public Holiday in Mumbai, interest will be payable on the next business day in Mumbai and Principal will be payable on the Preceding business day in Mumbai and shall be the interest/principal payment date. List of Beneficial Owners The Issuer shall request the Depository to provide a list of Beneficial Owners as at the end of the Record Date. This shall be the list, which shall be considered for payment of interest or repayment of principal amount, as the case may be. Succession In the event of the demise of the sole/first holder of the Bond(s) or the last survivor, in case of joint holders for the time being, the Company will recognize the executor or administrator of the deceased Bondholder, or the holder of succession certificate or other legal representative as having title to the Bond(s). The Company shall not be bound to recognize such executor or administrator, unless such executor or administrator obtains probate, wherever it is necessary, or letter of administration or such holder is the holder of succession certificate or other legal representation, as the case may be, from a Court in India having jurisdiction over the matter. The Company may, in its absolute discretion, where it thinks fit, dispense with production of probate or letter of administration or succession certificate or other legal representation, in order to recognize such holder as being entitled to the Bond(s) standing in the name of the deceased Bondholder on production of sufficient documentary proof or indemnity. Where a non‐resident Indian becomes entitled to the Bond by way of succession, the following steps have to be complied with: a. Documentary evidence to be submitted to the Legacy Cell of the RBI to the effect that the Bond was

acquired by the NRI as part of the legacy left by the deceased holder. b. Proof that the NRI is an Indian National or is of Indian origin. Such holding by the NRI will be on a non‐repatriation basis. Registrar to the Bondholders

The Company has appointed Link Intime India Private Ltd. to act as Registrar for and on behalf of the holder(s) of the NCDs (“Registrar”). The address and contact details of the Registrar are as under:

Name Link Intime India Private Ltd

Address

C‐13, Pannalal Silk Mills Compound, L.B.S Marg, Bhandup (West), Mumbai 400078

Contact Details Tel.: (022) 25946970, Fax: (022) 25962691

E‐mail Address [email protected]

Who Can Apply Only those entities, which are individually addressed through direct communication by the Company, are eligible to apply for the NCDs. No other entity may apply. The Company may address its offer to apply to potential Investors who may include: 1. Commercial Banks, 2. Financial Institutions, 3. Companies within the meaning of the Companies Act, 1956 or Companies Act, 2013, 4. Regional Rural Banks, 5. Co‐operative Banks, 6. Non‐Banking Finance Companies and Residuary Non‐Banking Finance Companies, 7. Insurance Companies, 8. Port Trusts, 9. Provident Funds, Superannuation Funds and Gratuity Funds, 10. Mutual Funds, 11. Foreign Institutional Investors (Subject to existing regulations)

All investors are required to comply with the relevant regulations/ guidelines applicable to them for investing in the issue of NCDs. Although above investors are eligible to apply however only those persons, who are individually addressed through direct communication by the Company/ Arranger, are eligible to apply for the NCDs. No other person may apply. Hosting of Information Memorandum on the website of Bombay Stock Exchange should not be construed as an offer to issue and the same has been hosted only as it is stipulated by SEBI.

Application under Power of Attorney or by Limited Companies In case of applications made under a Power of Attorney or by a Limited Company or a Body Corporate or Registered Society or Mutual Fund, and scientific and/or industrial research organisations or Trusts etc, the relevant Power of Attorney or the relevant resolution or authority to make the application, as the case may be, together with the certified true copy thereof along with the certified copy of the Memorandum and Articles of Association and/or Bye‐Laws as the case may be must be attached to the Application Form or lodged for scrutiny separately with the photocopy of the Application Form, quoting the serial number of the Application Form and the Bank’s branch where the application has been submitted, at the office of the Registrars to the Issue after submission of the Application Form to the bankers to the issue or any of the designated branches as mentioned on the reverse of the Application Form, failing which the applications are liable to be rejected. Such authority received by the Registrars to the Issue more than 10 days after closure of the subscription list may not be considered. How to Apply This being a Private Placement Offer, Investors as specified under the head “who can apply ” and who have been addressed through this Communication directly or on behalf of the Company, only are eligible to apply. The application should be accompanied with the Cheque/ Demand Draft (high value clearing) for the total amount of issue price of NCDs applied for subscription. Applications along with High Value Cheques/ Demand Drafts for the requisite amount & other necessary documents may be deposited with the Banker to the Issue at Mumbai by 10.00 am on the Pay in Date. For details please refer to the “instructions” detailed in the “Application Form”. Photocopy of Application Form duly filled in and signed to be faxed to the Company after deposit of application money. All Cheque(s) /Demand Draft(s) should be made payable in favour of “Talwalkars Better Value Fitness Ltd.” and crossed “Account Payee only”. Cheque(s)/ Demand Draft(s) may be drawn on any bank and must be payable at Mumbai. Outstation Cheques, money orders or postal orders will NOT be accepted. No cash and stock invest will be accepted. Investors can also opt for the RTGS mechanism to make the payments. The payments have to be made on the Inter‐bank platform of the RTGS and funds are to be transferred to Axis Bank Ltd, A/c. Talwalkars Better Value Fitness Ltd., 004010200059343 that carries the IFSC code of UTIB0000004. Applications for the NCDs must be in the prescribed form (enclosed) and completed in BLOCK LETTERS in English and as per the instructions contained therein. Applications complete in all respects (along with all necessary documents as detailed in this Disclosure Document) must be submitted before the last date indicated in the issue time table or such extended time as decided by the Company, at any of the designated collection centres, accompanied by the subscription amount by way of cheque(s)/ demand draft(s) drawn on any bank including a co‐operative bank which is situated at and is a member of the Bankers’ clearing house located at a place where the application form is submitted. Outstation cheque(s)/ Bank draft(s) drawn on Bank(s) not participating in the clearing process at the designated clearing centres will not be accepted. Money orders/ postal orders will also not be accepted. The Company assumes no responsibility for any applications/ cheques/ demand drafts lost in mail.

No separate receipt will be issued for the application money. However, the Company’s designated collection branches or Arranger(s) receiving the duly completed Application Form will acknowledge receipt of the application by stamping and returning to the applicant the Acknowledgment Slip at the bottom of the each Application Form.

The Applications must be accompanied by certified true copies of (1) Memorandum and Articles of Association/ Constitution/ Bye‐laws (2) Resolution authorizing investment and containing operating instructions (3) Specimen signatures of authorized signatories and (4) Necessary forms for claiming exemption from deduction of tax at source on the interest income/ interest on application money, wherever applicable.

As a matter of precaution against possible fraudulent encashment of interest warrants/ cheques due to loss/ misplacement, the applicant should furnish the full particulars of his or her bank account (i.e. Account Number, name of the bank and branch) at the appropriate place in the Application Form. Interest warrants will then be made out in favour of the bank for credit to his/ her account so specified and dispatched to the investors, who may deposit the same in the said bank.

Right to Accept or Reject Applications The Company reserves it’s full, unqualified and absolute right to accept or reject any application, in part or in full, without assigning any reason thereof. The rejected applicants will be intimated along with the refund warrant, if applicable, to be sent. Interest on application money will be paid from the date of realisation of the cheque(s)/ demand drafts(s) till one day prior to the date of refund. The application forms that are not complete in all respects are liable to be rejected and would not be paid any interest on the application money. Application would be liable to be rejected on one or more technical grounds, including but not restricted to: a. Number of NCDs applied for is less than the minimum application size; b. Applications exceeding the issue size; c. Bank account details not given; d. Details for issue of NCDs in electronic/ dematerialized form not given; PAN/GIR and IT

Circle/Ward/District not given; e. In case of applications under Power of Attorney by limited companies, corporate bodies, trusts, etc.

relevant documents not submitted; In the event, if any Bond(s) applied for is/ are not allotted in full, the excess application monies of such NCDs will be refunded, as may be permitted. PAN/GIR Number All applicants should mention their Permanent Account Number or the GIR Number allotted under Income Tax Act, 1961 and the Income Tax Circle/ Ward/ District. In case where neither the PAN nor the GIR Number has been allotted, the fact of such a non‐allotment should be mentioned in the Application Form in the space provided. Signatures Signatures should be made in English and in any of the Indian Languages. Thumb impressions must be attested by an authorized official of a Bank or by a Magistrate/ Notary Public under his/her official seal. Nomination Facility As per Section 72 of the Companies Act, 2013 read with the Companies (Share Capital and Debentures) Rules, 2014, only individuals applying as sole applicant/Joint Applicant can nominate, in the prescribed manner, a person to whom his NCDs shall vest in the event of his death. Non‐individuals including holders of Power of Attorney cannot nominate.

Bondholder not a Shareholder The bondholders will not be entitled to any of the rights and privileges available to the shareholders. If, however, any resolution affecting the rights attached to the NCDs is placed before the members of the Company, such resolution will first be placed before the bondholders for their consideration. Modification of Rights The rights, privileges, terms and conditions attached to the NCDs may be varied, modified or abrogated with the consent, in writing, of those holders of the NCDs who hold at least three fourth of the outstanding amount of the NCDs or with the sanction accorded pursuant to a resolution passed at a meeting of the Bondholders, provided that nothing in such consent or resolution shall be operative against the Company

where such consent or resolution modifies or varies the terms and conditions of the NCDs, if the same are not acceptable to the Company.

Future Borrowings The Company shall not be entitled to borrow / raise loan or avail of financial assistance in whatever form Debentures/ NCDs /Term Loans or raise further funds from such persons /Banks/Financial Institutions or Body Corporate/or any other Agency, issue any corporate guarantee over and above the limit of Rs. 100 crores to its subsidiaries, group Companies or any other Companies and shall not create any mortgage or charge (including the superior charge if any) on any of the offered fixed asset without obtaining prior written approval of the Debenture holders. Debenture Redemption Reserve The Company needs to create Debenture Redemption Reserve (DRR) and credit to DRR such amounts as specified under Section 71 of the Companies Act, 2013 read with the Companies (Share Capital and Debentures) Rules, 2014 and MCA circulars issued from time to time by the Central Government in this regard.

Notices All notices required to be given by the Company or by the Trustees to the Bondholders shall be deemed to have been given if sent by ordinary post/ courier to the Bond holders and/ or if published in one All India English daily newspaper and one regional language newspaper.

All notices required to be given by the Bondholder(s), including notices referred to under “Payment of Interest” and “Payment on Redemption” shall be sent by registered post or by hand delivery to the Company or to such persons at such address as may be notified by the Company from time to time. Tax Benefits to the Bondholders of the Company The holder(s) of the NCDs are advised to consider in their own case, the tax implications in respect of subscription to the NCDs after consulting their own tax advisor/ counsel. Disputes & Governing Law The NCDs are governed by and shall be construed in accordance with the existing laws of India. Any dispute arising thereof will be subject to the jurisdiction of district courts of Maharashtra. Compliance Officer Ms. Avanti Sankav 801‐813, Mahalaxmi Chambers, 22, Bhulabhai Desai Road, Mumbai – 400 026. Tel. No.: +91 – 22 – 6612 6300 (Ext. 324) Fax No.: +91 – 22 – 6612 6363 The investors can contact the Compliance Officer in case of any pre‐issue/ post‐issue related problems such as non‐credit of letter(s) of allotment/ bond certificate(s) in the demat account, non‐receipt of refund order(s), interest warrant(s)/ cheque(s) etc.

IX. CREDIT RATING & RATIONALE THEREOF Credit Analysis & Research Ltd. (CARE) has assigned a rating of “AA‐” (Pronounced "double A minus”) to these NCDs indicating high safety and issuer’s capacity for timely servicing of debt obligations of financial commitments, vide Copy of rating letter from CARE is enclosed as Annexure to the Disclosure Document. In case of downgrade of the NCD from the Stipulated CARE AA‐ rating, the interest will increase by 25 bps on each notch downgrade. On further downgrade of the rating below “A” the interest will increase by 100 bps on each notch downgrade In case of non‐agreement on the revised interest rate on NCDs by the Company, the debenture holder reserves the right to recall the outstanding debentures along with all outstanding interest dues.

Other than the credit rating mentioned hereinabove, the TBVFL has not sought any other credit rating from any other credit rating agency(ies) for the NCDs offered for subscription under the terms of this Disclosure

Document. The above rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. The rating may be subject to revision or withdrawal at any time by the assigning rating agency. The rating obtained is subject to revision at any point of time in the future. The rating agency has the right to suspend, withdraw the rating at any time on the basis of new information etc. X. NAME OF DEBENTURE TRUSTEE In accordance with the provisions of Section 117B of the Companies Act, 1956 (1 of 1956) and Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993, the TBVFL has appointed SBICAP Trustee Company Limited to act as Trustees (“Trustees”) for and on behalf of the holder(s) of the NCDs. A copy of letter from SBICAP Trustee Company Limited conveying their consent to act as Trustee for the current issue of NCDs is enclosed elsewhere in this Disclosure Document. TBVFL hereby undertakes that a Trust Deed shall be executed by it in favour of the Trustees within two months of the closure of the Issue. The Trust Deed shall contain such clauses as may be prescribed under section 117A of the Companies Act, 1956 and those mentioned in Schedule IV of the Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993. Further the Trust Deed shall not contain any clause which has the effect of (i) limiting or extinguishing the obligations and liabilities of the Trustees or the TBVFL in relation to any rights or interests of the holder(s) of the NCDs, (ii) limiting or restricting or waiving the provisions of the Securities and Exchange Board of India Act, 1992 (15 of 1992); Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 and circulars or guidelines issued by SEBI, (iii) indemnifying the Trustees or the TBVFL for loss or damage caused by their act of negligence or commission or omission. The Bondholder(s) shall, without further act or deed, be deemed to have irrevocably given their consent to the Trustees or any of their agents or authorized officials to do all such acts, deeds, matters and things in respect of or relating to the NCDs as the Trustees may in their absolute discretion deem necessary or require to be done in the interest of the holder(s) of the NCDs. Any payment made by the TBVFL to the Trustees on behalf of the Bondholder(s) shall discharge the TBVFL pro tanto to the Bondholder(s). The Trustees shall protect the interest of the Bondholders in the event of default by the TBVFL in regard to timely payment of interest and repayment of principal and shall take necessary action at the cost of the TBVFL. No Bondholder shall be entitled to proceed directly against the TBVFL unless the Trustees, having become so bound to proceed, fail to do so. In the event of TBVFL defaulting in payment of interest on NCDs or redemption thereof, any distribution of dividend by the TBVFL shall require approval of the Trustees.

XI. STOCK EXCHANGE WHERE SECURITIES ARE PROPOSED TO BE LISTED

The Secured Taxable Redeemable Non‐Convertible Debentures in the nature of Debentures are proposed to be listed on the Wholesale Debt Market (WDM) Segment of the Bombay Stock Exchange (BSE) The TBVFL has obtained an in‐principle approval from the BSE for listing of said NCDs on its Wholesale Debt Market (WDM) Segment. The TBVFL shall make an application to the BSE to list the NCDs to be issued and allotted under this Disclosure Document and complete all the formalities relating to listing of the NCDs within 15 days from the date of closure of the Issue. If such permission is not granted within 15 working days from the date of closure of the Issue or where such permission is refused before the expiry of the 15 working days from the closure of the Issue, the TBVFL shall forthwith repay without interest, all monies received from the applicants in pursuance of the Disclosure Document, and if such money is not repaid within 8 days after the TBVFL becomes liable to repay it (i.e. from the date of refusal or 15 working days from the date of closing of the subscription list, whichever is earlier), then the TBVFL and every director of the TBVFL who is an officer in default shall, on and from expiry of 8 days, will be jointly and severally liable to repay the money, with interest at the rate of 15 per cent per annum on application money, as prescribed under Section 73 of the Companies Act, 1956. In connection with listing of NCDs with BSE, the TBVFL hereby undertakes that: (a) It shall comply with conditions of listing of NCDs as may be specified in the Listing Agreement with BSE. (b) Rating obtained by the TBVFL shall be periodically reviewed by the credit rating agencies and any

revision in the rating shall be promptly disclosed by the TBVFL to BSE.

(c) Any change in rating shall be promptly disseminated to the holder(s) of the NCDs in such manner as BSE may determine from time to time.

(d) The TBVFL, the Trustees and BSE shall disseminate all information and reports on NCDs including compliance reports filed by the TBVFL and the Trustees regarding the NCDs to the holder(s) of NCDs and the general public by placing them on their websites.

(e) Trustees shall disclose the information to the holder(s) of the NCDs and the general public by issuing a press release in any of the following events: (i) default by the TBVFL to pay interest on NCDs or redemption amount; (ii) revision of rating assigned to the NCDs;

(f) The information referred to in para (e) above shall also be placed on the websites of the Trustees, TBVFL and BSE.

Undertaking by the Company The Issuer undertakes that: a) The complaints received in respect of the Issue shall be attended to by the issuer expeditiously and

satisfactorily; b) It shall take all steps for completion of formalities for listing and commencement of trading at the

concerned stock exchange where Non‐Convertible Debentures are to be listed within specified time frame;

c) Necessary co‐operation to the credit rating agencies shall be extended in providing true and adequate information till the debt obligations in respect of the instrument are outstanding.

d) It shall use a common form of transfer for the instrument. XII. DETAILS OF OTHER BORROWINGS (DEBT EQUITY RATIO, HIGHEST TEN HOLDERS OF EACH CLASS OR KIND OF SECURITIES, DETAILS DEBT SECURITIES ISSUED IN THE PAST, PARTICULARS OF DEBT SECURITIES ISSUED FOR CONSIDERATION OTHER THAN CASH OR AT A PREMIUM OR DISCOUNT OR IN PURSUANCE OF AN OPTION)

a. SECURED LOANS:

Term Loans Rs. in Lacs

Particulars As on March 31 2014 As on Dec 31 2014

(A) From Financial Institutions:

BMW Financial Services 84.21 67.47

OAIS Auto Financial Services 49.67 42.10

(B) From Bank:

Union Bank of India – Term Loan 9672.92 ‐

State Bank of India – Term Loan ‐ 12893.19

Union Bank of India – Acceptances 1220.82 1066.70

Non‐ Convertible Debentures 5500.00 8000.00

TOTAL:‐ 16527.62 22069.46

b. UNSECURED LOANS: Rs in Lacs


Unsecured Loans 3019.07 241.70

TOTAL:‐ 3019.07 241.70

Details of Unsecured Loans: Rs in Lacs


FirstRand Bank – Short term loan 2000.00 ‐Ratnakar Bank – Short term loan 1000.00 ‐Better Value Leasing and Finance Ltd. 15.42 238.05In‐House Productions Ltd. 2.58 2.58Sigmatograph Pvt. Ltd. 1.07 1.07

Grand Total 3019.07 241.70

c. DEBT EQUITY RATIO: (Rs. In Lacs)

Particulars Pre issue Post Issue

As on 31.12.2014 As on _____

Long Term Debt 22311.16

Shareholders’ Fund:

Share Capital 2618.09

Capital Suspense Account

Reserves and Surplus 23006.43

Net Worth 25624.52

Long Term Debt / Net Worth 0.87 3. TOP 10 HOLDERS OF EACH CLASS AND KIND OF SECURITIES A. TOP 10 EQUITY SHAREHOLDERS

TOP 10 EQUITY SHAREHOLDERS AS AT 31/12/2014:

Sr. No. Name of Shareholder Number of

Equity Shares held

1 Mr. Prashant Sudhakar Talwalkar 28,76,080

2 Mr. Girish Madhukar Talwalkar 28,64,280

Mr. Vinayak Ratnakar Gawande 19,20,200

Mr. Anant Ratnakar Gawande 19,20,200

3 Mr. Harsha Ramdas Bhatkal 15,60,200

4 Mr. Madhukar Vishnu Talwalkar 13,32,280

5 Smallcap World Fund Inc 16,94,000 6 Laxmi Shivanand Mankekar & Kedar Shivanand Mankekar 15,73,520 7 Bajaj Allianz Life Insurance Company Ltd. 10,80,980 8 Reliance Capital Trustee Co Ltd‐A/C Reliance Monthly Income Plan 9,33,816

9 Franklin India Smaller Companies Fund 6,82,119

10 American Funds Insurance Series Global Small Capitalisation Fund 6,50,000

TOTAL 1,90,87,675 B. TOP 10 HOLDERS OF NCDS (as on 31/12/2014) 1. Axis Bank Limited 2. Union Bank of India 3. Bank of Maharashtra 4. PARTICULARS OF DEBT SECURITIES ISSUED (I) FOR CONSIDERATION OTHER THAN CASH, WHETHER IN

WHOLE OR PART, (II) AT A PREMIUM OR DISCOUNT, OR (III) IN PURSUANCE OF AN OPTION The TBVFL hereby confirms that it has not issued any debt securities or agreed to issue debt securities for consideration other than cash, whether in whole or in part, at a premium or discount or in pursuance of an option since inception. XIII. SERVICING BEHAVIOR ON EXISTING DEBT SECURITIES AND OTHER BORROWINGS The Issuer Company hereby confirms that: a) The main constituents of Company’s borrowings have been in the form of borrowings from term money

borrowings from banks. b) There are no defaults on debt/ interest servicing obligations on borrowings. c) The Company shall obtain the required Consent(s) from the existing lenders/ trustees for current issue of

NCDs. Further the lenders/ trustees have not nominated any directors in the Board of Directors of the Company.

XIV. UNDERTAKING REGARDING COMMON FORM OF TRANSFER The NCDs shall be transferred subject to and in accordance with the rules/ procedures as prescribed by the NSDL/ CDSL/ Depository Participant of the transferor/ transferee and any other applicable laws and rules notified in respect thereof. The normal procedure followed for transfer of securities held in dematerialized form shall be followed for transfer of these NCDs held in electronic form. The seller should give delivery instructions containing details of the buyer’s DP account to his depository participant. The transferee(s) should ensure that the transfer formalities are completed prior to the Record Date. In the absence of the same, interest will be paid/ redemption will be made to the person, whose name appears in the records of the Depository. In such cases, claims, if any, by the transferee(s) would need to be settled with the transferor(s) and not with the TBVFL. The TBVFL undertakes that it shall use a common form/ procedure for transfer of NCDs issued under terms of this Disclosure Document.

XV. MATERIAL EVENT/ DEVELOPMENT/ CHANGE AT THE TIME OF ISSUE Company paid back Rs. 25 Cr NCD issued to Axis Bank Ltd. in 2011. Axis Bank subscribed to fresh NCD of Rs. 25 cr. New NCDs issued are for a period of six years under the same terms as earlier.

XVI. PERMISSION/ CONSENT FROM PRIOR CREDITORS The TBVFL hereby confirms that it has requisite corporate approvals including borrowing power and accordingly is entitled to raise money through current issue of NCDs. The required consent/ permission/ approval from the Bondholders/ Trustees/ Lenders/ other creditors of the TBVFL shall be obtained in due course.

XVII. MATERIAL CONTRACTS INVOLVING FINANCIAL OBLIGATIONS OF THE COMPANY The contracts referred to in Para A below (not being contracts entered into in the ordinary course of the business carried on by the Company or entered into more than 2 years before the date of the Information Memorandum) which are or may be deemed to be material have been entered into by the Company. Copies of these contracts together with the copies of documents referred to in Para B may be inspected at the Corporate Office of the Company between 10 am and 12 noon on any working day until the closing of the subscription list. A. MATERIAL CONTRACTS a. Copy of letters appointing Arranger to the Issue. b. Copy of letter appointing Registrar and Transfer Agents and copy of MoU entered into between the

Company and the Registrar. c. Copy of letter appointing SBICAP Trustee Company Limited as Trustees to the Bondholders. B. DOCUMENTS 1. Memorandum and Articles of Association of the Company. 2. Certificate of Incorporation. 3. Certificate of Commencement of Business. 4. Copy of the Board Resolution dated 5th February, 2015 authorising the current issue of NCDs. 5. Annual Reports of the Company for Financial Years 2011‐12, 2012‐13 and 2013‐14 6. Credit Rating letter from and the rating rationale relating thereto. 7. Tripartite Agreement which will be executed between the Company, NSDL and the Registrar & Transfer

Agents. 8. Tripartite Agreement which will be executed between the Company, CDSL and the Registrar & Transfer

Agents.

XVIII. DECLARATION

It is hereby declared that this Disclosure Document contains full disclosures in accordance with Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 issued vide Circular No. LAD‐NRO/GN/2008/13/127878 dated June 06, 2008 and Securities & Exchange Board of India (Issue & Listing of Securities) (Amendment) Regulations, 2012) and Securities & Exchange Board of India (Issue & Listing of Securities) (Amendment) Regulations, 2014 issued vide circular no. LAD‐NRO/GN/2013‐14/43/207 dated

XIX. ANNEXURES A. CREDIT RATING LETTER FROM CARE

B. RATING RATIONALE FROM CARE.

C. CONSENT LETTER FROM SBICAP TRUSTEE COMPANY LIMITED.

D. APPLICATION FORM

TALWALKARS BETTER VALUE FITNESS LTD. Registered Office: 801‐813, Mahalaxmi Chambers, 22, Bhulabhai Desai Road, Mumbai – 400 026 Tel No: 022‐66126300 (324)

APPLICATION FORM FOR SECURED TAXABLE REDEEMABLE NON‐CONVERTIBLE BONDS IN THE NATURE OF DEBENTURES The Board of Directors Dear Sirs, Having read, understood and agreed to the contents and terms and conditions of Talwalkars Better Value Fitness Limited Disclosure Document dated 25

th February, 2015, I/we hereby apply for allotment to me/us, of the under

mentioned NCDs (hereinafter referred to as “NCDs”), out of the Private Placement Issue. I/We irrevocably give my/ our authority and consent to SBICAP Trustee Company Limited, to act as my/our Trustees and for doing such acts and signing such documents as are necessary to carry out their duties in such capacity. The amount payable on application as shown below is remitted herewith. I/We note that the Board of Directors are entitled in their absolute discretion to accept or reject this application in whole or in part without assigning any reason whatsoever. I/We confirm that I/we have not received and will not receive any commission or brokerage or any other incentive in any form, directly or indirectly, for subscribing to the Issue. APPLICANT’S DETAILS SOLE/FIRST APPLICANT’S NAME IN FULL SIGNATORY/AUTHORISED SIGNATORY

SECOND APPLICANT’S NAME

THIRD APPLICANT’S NAME

ADDRESS (Do not repeat name) (Post Box No. alone is not sufficient)

TEL FAX PIN CODE

SOLE/ FIRST APPLICANT CATEGORY (Tick one) INVESTMENT DETAILS

DETAILS FOR INTEREST PAYMENT/ REDEMPTION (Ref. Instructions) PAYMENT DETAILS

RTGS details of Sole/ First Applicant

Cheque/ Demand Draft No.

Bank A/c No. Dated

Name of the Bank Drawn on (Name of the Bank)

Address of the Branch Branch

Banker’s IFSC Code

Applicants can alternatively remit their application money through RTGS to Talwalkars Better Value Fitness Ltd. (IFSC code UTIB0000004). SOLE/ FIRST APPLICANT’S BANK DETAILS (Ref. Instructions) INCOME TAX DETAILS (Ref. Instructions)

Bank Name Sole/ First Applicant

Second Applicant

Third Applicant

Branch P.A,N. / G.I.R. NO.

City

Account Number I.T. Circle/ Ward/ District No.

Type of Account Savings Current Others

Scheduled Commercial Bank Face Value Rs. 10,00,000/‐ (Rupees Ten Lacs Only) per NCD

Financial Institution Issue Price Rs. 10,00,000/‐

Insurance Company Minimum Application 5 NCDs and in multiples of 1 NCD thereafter

Mutual Fund Tenure 6 Years

Company/ Body Corporate Put/ Call Option at the end of 3rd year

Provident/ Gratuity/ Superannuation Fund Trust

Redemption In three equal installments starting at the end of 4th Year

from

deemed date of allotment

Others (please specify) – Amount payable per Bond (i) Rs. 10,00,000/‐

No. of Bonds Applied For (ii)

For Office Use Only

Date of Receipt of Application

/ /

Date of Clearance of Cheque

/ /

(PLEASE READ CAREFULLY THE INSTRUCTIONS ON THE NEXT PAGE BEFORE FILLING UP THIS FORM)

Application Form No. ----------

TO BE FILLED IN ONLY IF THE APPLICANT IS AN INSTITUTION

Name of the Authorized Signatory(ies) Designation Signature

1. 1.

2. 2.

3. 3.

4. 4.

DETAILS FOR ISSUE OF NCDS IN ELECTRONIC/ DEMATERIALISED FORM APPLICANT’S SIGNATURE(S)

Depository Name (please tick) NSDL CDSL Sole/ First Applicant

Depository Participant Name

DP‐ID Number

Client‐ID Second Applicant

Beneficiary Account Number

Name of the Applicant Third Applicant

‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐(Tear Here)‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐‐‐*‐‐‐‐‐‐‐‐‐‐‐*

TALWALKARS BETTER VALUE FITNESS LTD. Registered Office: 801‐813, Mahalaxmi Chambers, 22, Bhulabhai Desai Road, Mumbai – 400 026 Tel No: 022‐66126300 (324)

All future communication in connection with this application should be addressed to the Registrars: “Link Intime India Private Ltd.” [Address: C‐13, Pannalal Silk Mills Compound, L.B.S Marg, Bhandup (West) Mumbai – 400 078. Tel: (022) 25946970; Fax No: (022) 2596 2691] quoting full name of Sole/ First Applicant, Application No., Number of Bonds applied for, Date, Bank and Branch where the application was submitted and Cheque/ Demand Draft Number and Issuing Bank.

(To be filled in by the Applicant) Received from_________________________________________________________________ Address______________________________________________________________________ an application for ___________ NCDs vide Cheque/ Demand Draft No. ___________________ Drawn on_____________________________________________________________________

Dated____________ amounting to Rs. _____________________________________________.

Note: Cheque(s) are subject to realisation.

Application Form No. ______

ACKNOWLEDGEMENT SLIP

E. INSTRUCTIONS

INSTRUCTIONS

1. Application forms must be completed in full in BLOCK LETTERS IN ENGLISH. A blank space must be left

between two or more parts of the name.

A B C D E L T D

Signatures should be made in English or in any of the Indian languages. Thumb impressions must be attested by an authorised official of a Bank or by a Magistrate/ Notary Public under his/ her official seal.

2. Application forms duly completed in all respects must be submitted with the respective Collecting

Banker. Cheque(s)/ Demand Draft(s) should be drawn in favour of “Talwalkars Better Value Fitness Ltd.” and crossed “Account Payee only”. Cheque(s)/ Demand draft(s) may be drawn on any bank including a co‐operative bank, which is a member or a sub‐member of the Banker’s Clearing House located at Chennai, Bangalore, Hyderabad, Ahmedabad, Kolkata, New Delhi or Mumbai.

3. Applicants can alternatively remit the application money through RTGS to Axis Bank Ltd, A/c.

Talwalkars Better Value Fitness Ltd., 004010200059343 that carries the IFSC code of UTIB0000004. 4. Outstation cheques, cash, money orders, postal orders and stock invest shall not be accepted. 5. As a matter of precaution against possible fraudulent encashment of interest warrants due to

loss/misplacement, applicants are requested to mention the full particulars to their bank account, as specified in the Application Form. Interest warrants will then be made out in favour of the bank for credit to the applicant’s account. In case the full particulars are not given, cheques will be issued in the name of the applicant at his/ her risk. Alternatively the applicants may furnish their RTGS details for receipt of interest/ redemption amount(s) through RTGS mode.

6. Receipt of applications will be acknowledged by the respective Collecting Branch of the Bank in the

“Acknowledgment Slip”, appearing below the Application Form. No separate receipt will be issued. 7. All applicants should mention their Permanent Account Number or the GIR number allotted under

Income‐Tax Act, 1961 and the Income‐Tax Circle/Ward/District. In case where neither the PAN nor GIR number has been allotted, the fact of non‐allotment should be mentioned in the application form in the space provided.

8. The application would be accepted as per the terms of the Scheme outlined in the Disclosure

Document for Private Placement dated 25th February, 2015.

Financial Data

BALANCE SHEET (Standalone) Rs. In Millions

PARTICULARS As at March 31, 2014 As at March 31, 2013 As at March 31, 2012

I. EQUITY & LIABILITIES

1) Shareholders' Funds

(a)Share Capital 261.81 261.81 241.16

(b)Reserves and Surplus 2048.73 1,760.64 1,163.57

2) Non‐Current Liabilities

(a)Long Term Borrowings 1238.51 1,191.26 1,135.66

(b)Deferred Tax Liabilities(Net) 227.36 184.73 136.75

(c)Other Long Term Liabilities 122.58 157.61 92.26

3) Current Liabilities

(a)Short Term Borrowings 300.00 43.17 100.00

(b)Trade Payables 82.49 60.35 52.06

(c)Other Current Liabilities 367.21 311.64 186.19

(d)Short Term Provisions 141.29 130.83 89.74

TOTAL 4,789.98 4,102.04 3,197.39

II. ASSETS

1) Non‐Current Assets

(a)Fixed Assets

(i)Tangible Assets 3699.35 2,890.99 2,178.52

(ii)Intangible Assets 39.44 40.50 43.19

(iii)Capital Work In Progress 340.72 293.66 216.20

(iv) Intangible Assets under development 3.32 3.32 ‐

(b)Non‐Current Investments 109.50 248.30 193.86

(c)Long Term Loans and Advances 199.67 212.72 186.11

(d) Other Non‐Current Assets 0.09 1.60 1.60

2) Current Assets

(a)Current Investments 0.22 0.22 0.09

(b)Inventories 0.63 1.55 ‐

(c)Trade Receivables 274.20 138.24 147.68

(d)Cash and Cash Equivalents 41.56 193.84 180.38

(e)Short Term Loans and Advances 81.28 77.10 49.77

TOTAL 4,789.98 4,102.04 3,197.39

STATEMENT OF PROFIT AND LOSS (Standalone) Rs. In Millions

PARTICULARS

For the NineMonths Ended December 31,

2014

For the Year Ended March 31, 2014



1. REVENUE

a. Revenue from operations 1,523.70 1,800.47

1,459.03

1,093.52

Less: Service tax 161.75 190.35

154.67

98.87

1,361.94 1,610.12

1,304.36

994.65

b. Other Income 5.50 8.25

12.54

14.15

Total Revenue 1,367.44 1,618.37

1,316.90

1,008.80

2. EXPENSES

(a) Changes in Inventories 0.13 0.92

(1.55)

‐

(b) Purchase of stock‐in‐trade ‐ 1.18

2.87

‐

(c) Employee benefit expenses 248.46 293.97

266.90

211.26

(d) Financial costs 87.97 95.58

94.79

77.86

(e)Depreciation and amortization expenses 271.38 222.66

132.27

109.43

(f) Other expenses 422.07 507.75

411.00

332.84

Total Expenses 1,030.02 1,122.06

906.28

731.39

3. Profit before exceptional and extraordinary items and tax (1 ‐ 2) 337.42 496.31

410.62

277.41

4. Exceptional Items ‐ (0.28) ‐

3.68

5. Profit before extraordinary items and tax (3 + 4) 337.42 496.03

410.62

281.10

6. Extraordinary Items ‐ ‐ ‐

‐

7. Profit before tax (5 + 6 ) for the year 337.42 496.03 410.62 281.10

8. Tax expense:

(a) Current tax 76.79 110.79

88.26

60.05

Less : MAT credit Entitlement ‐ 8.58

(3.64)

(0.74)

(b) Deferred tax 9. Profit(Loss) from the period from continuing operations (7 ‐ 8)

‐ 42.63

49.32

29.82

260.63 334.03

276.68

191.97

10. Profit/(Loss) from Discontinuing operations ‐ ‐

‐

‐

11. Profit/(Loss) for the period (9 + 10) 260.63 334.03

276.68

191.97

12. Earning per equity share (of Rs 10 each) :

(1) Basic 9.96 12.76

11.19

7.96

(2) Diluted 9.96 12.76

11.19

7.96

CASH FLOW STATEMENT (Standalone) Rs. In Millions

Particulars Year ended 31.03.2014

Year ended 31.03.2013


A CASH FLOW FROM OPERATING ACTIVITIES:

Net profit before Taxes

496.03

410.62

281.10

Non‐cash expenses

222.66

132.27

109.43

Finance cost (Net)

95.58

94.79

77.86

Income from Investment activity

(1.93)

(3.45)

(3.49)

(Profit)/Loss on sale of assets

0.28

‐

(3.68)

316.59

223.61

180.12

Operating Profit before Working capital changes

812.62

634.23

461.22

(Increase)/Decrease in Current Assets

(10.87)

(54.20)

(62.03)

(Increase)/Decrease in Trade and other receivables

(135.96)

9.45

(3.31)

Increase/(Decrease) in Trade and other payables

28.06

39.94

10.93

(118.76)

(4.81)

(54.41)

Cash generated from operations

639.86

629.42

406.81

Direct taxes paid

(100.64)

(59.12)

(15.44)

Net cash from operating activities 593.22

570.30

391.37

B CASH FLOW FROM INVESTING ACTIVITES:

Investment in Joint Venture

‐

(3.35)

(8.85)

Payment towards purchase of Fixed Assets, CWIP

(1,023.42)

(840.69)

(881.84)

Proceeds from sale of fixed assets

44.95

‐

263.38

Dividend Received

1.93

3.07

0.01

Purchase of Short Term Investments

(412.80)

(452.08)

(690.81)

Proceeds from sale of Short Term Investments

568.86

401.22

606.11

Net cash (used in)/from Investing activities

(820.48)

(891.83)

(712.00)

C CASH FLOW FROM FINANCING ACTIVITIES:

QIP Share issue Proceeds

‐

423.74 ‐

Repayment of NCDs

(250.00) ‐ ‐

Issue proceeds from NCDs

250.00

‐

250.00

NCD interest

(62.77)

(64.44)

(34.50)

QIP related expenses

‐

(37.07) ‐

Borrowings done

991.27

691.08

446.19

Repayment of Long term and other borrowings

(679.18)

(528.41)

(283.45)

Finance cost paid

(130.20)

(114.87)

(121.38)

Dividend Paid

(39.27)

(30.15)

(24.12)

Dividend Tax Paid

(6.37)

(4.89)

(4.00)

Net cash used in Financing Activities

73.48

334.99

228.74

NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C)

(153.78)

13.46

(91.89)

CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD

195.43

181.97

273.86

Cash & Bank Balance including Fixed Deposits

41.65

195.43

181.97

CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD

41.65

195.43

181.97

BALANCE SHEET (Consolidated) Rs. In Millions

PARTICULARS As at March 31, 2014 As at March 31, 2013 As at March 31, 2012

I. EQUITY & LIABILITIES

1) Shareholders' Funds

(a)Share Capital 261.81

261.81 241.16

(b)Reserves and Surplus 2143.11 1823.16 1,202.19

2) Minority Interest 112.52 80.62 50.27

3) Non‐Current Liabilities

(a)Long Term Borrowings 1373.15 1351.80 1,220.14

(b)Deferred Tax Liabilities(Net) 237.51 192.14 142.77

(c)Other Long Term Liabilities 131.69 165.88 92.26

4) Current Liabilities

(a)Short Term Borrowings 307.54 47.93 100.00

(b)Trade Payables 98.22 80.34 39.30

(c)Other Current Liabilities 414.07 347.44 186.65

(d)Short Term Provisions 177.03 154.86 101.41

TOTAL 5256.65 4505.98 3,376.15

II. ASSETS

1) Non‐Current Assets

(a)Fixed Assets

(i)Tangible Assets 4012.44 3112.16 2,316.17

(ii)Intangible Assets 39.45 40.54 43.25

(iii)Capital Work In Progress 449.93 421.80 216.21

(iv) Intangible Assets under development 3.32

3.32 ‐

(b)Non‐Current Investments 87.79 226.59 175.00

(c)Long Term Loans and Advances 241.61 251.79 199.43

(d) Other Non‐Current Assets 1.58 2.12 2.19

2) Current Assets

(a)Current Investments 0.22

0.22 0.08

(b)Inventories 0.63

1.55 ‐

(c)Trade Receivables 320.45 177.48 200.96

(d)Cash and Cash Equivalents 60.03 229.24 198.47

(e)Short Term Loans and Advances 39.20 39.17 24.39

TOTAL 5256.65 4505.98 3,376.15

STATEMENT OF PROFIT AND LOSS (Consolidated) Rs. In Millions

PARTICULARS

For the Nine Months Ended December 31,

2014




1. REVENUE

a. Revenue from operations 1,757.24 2094.56 1687.83

1,305.31

Less: Service tax 186.76 221.82 179.31

111.67

1,361.94 1872.74 1508.52

1,193.64

b. Other Income 5.35 10.77 13.06

15.70

Total Revenue 1,575.83 1883.51 1521.58

1,209.34

2. EXPENSES

(a) Changes in Inventories 0.13 0.92

(1.55)

‐

(b) Purchase of stock‐in‐trade ‐ 1.18

2.87

‐

(c) Employee benefit expenses 299.91 358.61 311.74

248.23

(d) Financial costs 107.04 119.66 107.91

91.28

(e)Depreciation and amortization expenses 292.73 241.77 146.47

117.73

(f) Other expenses 485.74 584.91 469.77

402.58

Total Expenses 1185.55 1307.05 1037.21

859.82

3. Profit before exceptional and extraordinary items and tax (1 ‐ 2) 398.28 576.46 484.37

349.52

4. Exceptional Items ‐ (0.28) ‐

3.68

5. Profit before extraordinary items and tax (3 + 4) 390.28 576.18 484.37

353.20

6. Extraordinary Items ‐ ‐ ‐

‐

7. Profit before tax (5 + 6 ) for the year 390.28 576.18 484.37 353.20

8. Tax expense:

(a) Current tax 77.61 125.19 111.63

73.27

Less : MAT Credit Reversal / (Entitlement) ‐ 7.87

(3.64)

(0.74) (b) Deferred Tax ‐ 45.37 50.23

31.50

(c) Prior Year Tax ‐ (0.04) ‐ ‐

9. Profit(Loss) for the period from continuing operations (7 ‐ 8) 312.67 397.79 326.15

249.17

10. Profit/(Loss) from Discontinuing operations ‐ ‐

‐

‐

11. Profit/(Loss) for the period (9 + 10) 312.67 397.79 326.15

249.17

12. Share of Minority Interest 13. Profit/(Loss) after Minority Interest (11 ‐ 12)

30.75 31.90 25.65 28.57

281.92 365.89

300.50 220.60

12. Earning per equity share (of Rs 10 each) :

(1) Basic 10.77 13.98 12.15

9.15

(2) Diluted 10.77 13.98 12.15

9.15

CASH FLOW STATEMENT (Consolidated) Rs. In Millions

Particulars Year ended 31.03.2014



A CASH FLOW FROM OPERATING ACTIVITIES:

Net profit before Taxes 576.18 484.37 353.20

Non‐cash expenses 241.77 146.55 117.73

Finance cost (Net) 119.66 107.91 91.31

Income from Investment activity (1.93) (3.45) (3.49)

(Profit)/Loss on sale of assets 0.28 ‐ (3.68)

Interest Income (0.68) (0.03) (0.16)

359.10 250.98 201.71

Operating Profit before Working capital changes 935.28 735.35 554.91

(Increase)/Decrease in Current Assets (10.29) (55.31) (63.98)

(Increase)/Decrease in Non‐Current Assets 0.02 (4.61) (0.05)

(Increase)/Decrease in Trade and other receivables (152.42) 2.67 1.74

Increase/(Decrease) in Trade and other payables 48.19 75.79 (38.34)

Increase/(Decrease) in Current Liabilities 9.09 (2.41) (19.71)

(105.41) 16.13 (120.34)

Cash generated from operations 829.87 751.48 434.57

Direct taxes paid (103.33) (62.02) (16.76)

Share of Minority Interest (67.70) (60.76) (13.63)

Net cash from operating activities 658.84 628.70 404.18

B CASH FLOW FROM INVESTING ACTIVITES:

Investment in Joint Venture ‐ (3.35) (8.85)

Payment towards purchase of Fixed Assets, CWIP (1,129.74) (1,032.60) (889.07)

Proceeds from sale of fixed assets 44.95 ‐ 263.38

Dividend Received 1.93 3.07 0.01

Purchase of Short Term Investments (412.80) (452.07) (690.81)

Proceeds from sale of Short Term Investments 568.86 401.23 606.11

Interest Income 0.68 0.03 0.16

Preliminary Expenditure ‐ (0.02)

Share of Minority Interest 53.10 97.28 3.58

Net cash (used in)/from Investing activities (873.02) (986.41) (715.51)

C CASH FLOW FROM FINANCING ACTIVITIES:

QIP Share issue Proceeds ‐ 423.74 ‐

Share Application Money ‐ 1.35 7.45

Share issue Proceeds (Net of refund including Security Premium)

‐ 5.60 ‐

Repayment of NCDs (250.00) ‐ ‐

Issue proceeds from NCDs 250.00 ‐ 250.00

NCD interest (62.77) (64.44) (34.50)

QIP related expenses ‐ (37.07) ‐

Borrowings done 995.40 848.62 514.70

Repayment of Long term and other borrowings (702.81) (580.74) (363.35)

Finance cost paid (154.28) (134.91) (134.03)

Dividend Paid (39.27) (30.15) (24.12)

Dividend Tax Paid (6.37) (4.89) (4.00)

Share of Minority Interest 22.66 (45.91) 8.80

Net cash used in Financing Activities 52.56 381.20 220.95

NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C)

(161.62) 23.49 (90.37)

CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD

212.76 189.27 279.64

Cash & Bank Balance including Fixed Deposits 61.17 230.84 196.75

Less : Share of Minority Interest (10.03) (18.08) (7.48)

CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD

51.14 212.76 189.27

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