PREET REMEDIES LIMITED

Draft Prospectus

September 10 , 2018

Please read Section 32 of the Companies Act, 2013

Fixed Price Issue

PREET REMEDIES LIMITED CIN: U24230CH2005PLC027954

Our Company was originally incorporated as ‘Preet Remedies Private Limited’ on February 10, 2005 with the Registrar of Companies, Jalandhar under the provisions of the Companies Act, 1956. Subsequently, our Company was converted into a Public Limited Company and

the name of our Company was changed to ‘Preet Remedies Limited’. A fresh certificate of incorporation consequent upon conversion to

public limited Company was issued by the Registrar of Companies, Chandigarh on February 06, 2018. For further details of our Company, please refer to “General Information” and “History and Certain Other Corporate Matter” on Page No. 3 and 120, respectively, of this Draft

Prospectus.

Registered Office: Plot No 194-195, Third Floor, Industrial Area Phase II, Chandigarh-160 002

Contact Person: Mr. Sanjeev Kumar, Company Secretary & Compliance Officer

Tel. No.: +91 172 4651 105, Fax No.: +91 172 2656 855, Website: www.preetremedies.com, E-Mail Id: [email protected]

Promoters: Mr. Sanjeev Kumar Singnal, Mr. Harpeet Singh, Mr. Sanjay Dhir and Mr. Satish Kumar

THE ISSUE

PUBLIC ISSUE OF 24,00,000 EQUITY SHARES OF FACE VALUE OF ₹10 EACH FULLY PAID UP OF “PREET” OR “THE

COMPANY” OR “THE ISSUER” FOR CASH AT A PRICE OF ₹51 PER EQUITY SHARE (THE “ISSUE PRICE”)

(INCLUDING SHARE PREMIUM OF ₹41 PER EQUITY SHARE) AGGREGATING ₹ 1224.00 LAKHS (THE “ISSUE”) BY

OUR COMPANY OF WHICH 1,20,000 EQUITY SHARES OF FACE VALUE OF ₹10 EACH FULLY PAID UP WILL BE

RESERVED FOR SUBSCRIPTION BY THE MARKET MAKER TO THE ISSUE (“MARKET MAKER RESERVATION

PORTION”). THE ISSUE LESS THE MAKER RESERVATION PORTION I.E. ISSUE OF 22,80,000 EQUITY SHARES OF

FACE VALUE OF ₹10 EACH FULLY PAID UP IS HEREINAFTER REFERRED TO AS THE “NET ISSUE”. THE ISSUE

AND THE NET ISSUE WILL CONSTITUTE 28.57% AND 27.14% RESPECTIVELY OF THE POST ISSUE PAID UP

EQUITY SHARE CAPITAL OF THE COMPANY

₹THE FACE VALUE OF THE EQUITY SHARES IS ₹10 EACH AND THE ISSUE PRICE IS ₹ 51.

THE ISSUE PRICE IS 5.1 TIMES OF THE FACE VALUE.

THIS ISSUE IS BEING MADE IN TERMS OF CHAPTER XB OF SEBI (ICDR) REGULATIONS, 2009, AS AMENDED FROM TIME TO TIME

For further details please refer to “Section VIII - Issue Information” beginning on Page No.238 of this Prospectus

RISK IN RELATION TO THE FIRST ISSUE

This being the first issue of Equity Shares of our Company, there has been no formal market for the Equity Shares of our Company. The face value of the Equity Shares is ₹10 and the Issue Price is 5.1 times of the face value. The Issue Price (as determined and justified by

the Company and the Lead Manager as stated under chapter titled “Basis for Issue Price” beginning on Page No. 78 of this Prospectus)

should not be taken to be indicative of the market price of the Equity Shares after the Equity Shares are listed. No assurance can be given

regarding an active and/or sustained trading in the Equity Shares of our Company or regarding the price at which the Equity Shares will

be traded after listing.

GENERAL RISKS

Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their investment. Investors are advised to read the Risk Factors carefully before taking an

investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of our Company and

the Issue including the risks involved. The Equity Shares offered in the Issue have not been recommended or approved by the Securities and Exchange Board of India (“SEBI”) nor does SEBI guarantee the accuracy or adequacy of this Prospectus. Specific attention of the

investors is invited to the section titled “Risk Factors” on Page No. 15 of this Prospectus

COMPANY’S ABSOLUTE RESPONSIBILITY

Our Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Prospectus contains all information with regard to our Company and the Issue, which is material in the context of this Issue; that the information contained in this Prospectus

is true and correct in all material aspects and is not misleading in any material respect; that the opinions and intentions expressed herein

are honestly held and that there are no other facts, the omission of which makes this Prospectus as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.

LISTING

The Equity Shares offered through this Prospectus are proposed to be listed on the NSE EMERGE Platform. Our Company has received

an in-principle approval letter dated [●] from NSE for using its name in this Prospectus for listing of our Equity Shares on the NSE

Emerge. For the purpose of this Issue, the Designated Stock Exchange will be the National Stock Exchange of India Limited (“NSE”).

LEAD MANAGER TO THE ISSUE REGISTRAR TO THE ISSUE

Mark Corporate Advisors Private Limited CIN: U67190MH2008PTC181996

404/1, The Summit Business Bay,

Sant Janabai Road (Service Lane), Off W. E. Highway, Vile Parle (East),

Mumbai-400 057.

Contact Person: Mr. Manish Gaur Tel. No.: +91 22 2612 3207/08

E-Mail ID: [email protected]

SEBI Regn No.: INM000012128

Investor Grievance Email:

[email protected]

Bigshare Services Private Limited CIN: U99999MH1994PTC076534

1st Floor, Bharat Tin Works Building,

Opp. Vasant Oasis, Makhwana Road, Marol, Andheri (E), Mumbai – 400 059.

Contact Person: Mr. Ashok S Shetty

Tel No.: +91 22 2847 0652/4043 0200 E-Mail ID: [email protected]

SEBI Regn No.: INR000001385

ISSUE PROGRAMME

Issue Opens On [●] Issue Closes on [●]

2

Particulars Page No

SECTION I- GENERAL INFORMATION 3

USE OF FINANCIAL INFORMATION AND MARKET DATA AND CURRENCY

OF PRESENTATION

12

FORWARD LOOKING STATEMENTS 14

SECTION II - RISK FACTORS 15

SECTION III - INTRODUCTION 42

SUMMARY OF OUR INDUSTRY 42

SUMMARY OF OUR BUSINESS 44

SUMMARY OF OUR FINANCIAL STATEMENTS 48

THE ISSUE 56

GENERAL INFORMATION 57

CAPITAL STRUCTURE 63

SECTION - IV OBJECTS OF THE ISSUE 73

BASIC TERMS OF THE ISSUE 77

BASIS FOR ISSUE PRICE 78

STATEMENT OF TAX BENEFITS 81

SECTION V - ABOUT OUR COMPANY 83

OUR INDUSTRY 83

OUR BUSINESS 93

KEY INDUSTRY REGULATIONS AND POLICIES 108

OUR HISTORY AND OTHER CORPORATE MATTERS 120

OUR MANAGEMENT 123

OUR PROMOTERS/PROMOTER GROUP 136

GROUP ENTITIES 141

RELATED PARTY TRANSACTIONS 149

DIVIDEND POLICY 150

SECTION VI - FINANCIAL INFORMATION 151

FINANCIAL STATEMENTS 151

FINANCIAL INDEBTEDNESS 202

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS

AND RESULTS OF OPERATIONS

204

SECTION VII-LEGAL AND OTHER INFORMATION OUTSTANDING

LITIGATION AND MATERIAL DEVELOPMENTS

213

OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS 213

GOVERNMENT AND OTHER APPROVALS

222

OTHER REGULATORY AND STATUTORY DISCLOSURES 224

SECTION VIII- ISSUE RELATED INFORMATION 238

TERMS OF THE ISSUE 238

ISSUE STRUCTURE 244

ISSUE PROCEDURE 246

RESTRICTION ON FOREIGN OWNERSHIP OF INDIAN SECURITIES 285

SECTION IX – DESCRIPTION OF EQUITY SHARES AND TERMS OF THE

ARTICLE OF ASSOCIATION MAIN PROVISIONS OF ARTICLES OF

ASSOCIATION

288

SECTION X-OTHER INFORMATION 313

MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION 313

DECLARATION 314

3

SECTION I- GENERAL INFORMATION

DEFINITIONS AND ABBREVIATIONS

Unless the context otherwise indicates or implies, the following terms shall have the meanings provided below

in this Draft Prospectus, and references to any statute or regulations or policies will include any amendments or

re-enactments thereto, from time to time. In case of any inconsistency between the definitions given below and

the definitions contained in the General Information Document (as defined below), the definitions given below

shall prevail.

The words and expressions used but not defined herein shall have the same meaning as is assigned to such terms

under the SEBI (ICDR) Regulations, the Companies Act 1956/2013, the SCRA, the Depositories Act and the

rules and regulations made thereunder.

General Terms:

Term(s) Description

‘Our Company’ or ‘The

Company’ or ‘The Issuer’

Preet Remedies Limited, a company incorporated under the Companies Act,

1956 and having its Registered office at Plot No 194-195, Third Floor,

Industrial Area Phase II, Chandigarh – 160 002

‘we’, ‘us’ or ‘our’ Unless the context otherwise indicates or implies, refers to our Company

together with its Subsidiaries

Company related Terms:

Term(s) Description

Articles or Articles of

Association or AOA

The articles of association of our Company, as amended from time to time

Auditor/Statutory Auditor/

Peer Reviewed Auditor

M/s. Vijay Darji and Associates, having office at 1062, 10th Floor, Solaris

Hubtown, N S Phadke Marg, Andheri (East), Mumbai – 400 069

Bankers to our Company HDFC Bank Limited

Board/Board of

Directors/Our Board

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

time, or committee(s) thereof

Company Secretary and

Compliance Officer

Mr. Sanjeev Kumar

Director(s) The Director(s) of our Company, unless otherwise specified

Equity Shares Equity Shares of our Company of face value of ₹10 each

Equity Shareholders Persons holding equity shares of our Company

Group Companies/Entities Such companies/entities as covered under the applicable accounting

standards and such other companies as considered material by the Board. For

details, please refer “Group Entities” on Page No. 141 of this Draft

Prospectus

Key Management Personnel/

KMP

Key Management Personnel of our Company in terms of the SEBI (ICDR)

Regulations, 2009 and Companies Act, 2013. For details, please refer “Our

Management” on Page No. 123 of this Draft Prospectus

Memorandum/Memorandum

of Association/MOA

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

time

Non-Resident A person resident outside India, as defined under FEMA Regulations

Non-Resident Indian/NRI A person resident outside India, who is a citizen of India or a Person of

Indian Origin as defined under FEMA Regulations, as amended

Overseas Corporate Body/

OCB

A Company, Partnership, Society or other Corporate Body owned directly or

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

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

directly or indirectly as defined under the Foreign Exchange Management

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

Promoter Group Includes such persons and entities constituting our promoter group in terms

of Regulation 2(zb) of the SEBI (ICDR) Regulations and a list of which is

provided in the chapter titled “Our Promoters and Promoter Group”

beginning on Page No. 136 of this Draft Prospectus

Registered Office Plot No 194-195, Third Floor, Industrial Area Phase II, Chandigarh – 160

4

Term(s) Description

002

RoC Registrar of Companies, Chandigarh

Preet Remedies Limited / ₹

/the Company/our

Company/we/us/our and the

Issuer Company

Preet Remedies Limited, a Public Limited Company incorporated under the

provisions of the Companies Act, 1956

Issue related Terms:

Term(s) Description

Allocation/Allocation of

Equity Shares

The Allocation of Equity Shares of our Company pursuant to Fresh Issue of

Equity Shares to the successful Applicants

Allotment/Allot/Allotted Issue an allotment of Equity Shares of our Company pursuant to Fresh Issue of

the Equity Shares to the successful Applicants

Allottee(s) Successful Applicants to whom Equity Shares of our Company shall have been

allotted

Applicant Any prospective investor who makes an application for Equity Shares of our

Company in terms of this Draft Prospectus

Application Amount The amount at which the Applicant makes an application for Equity Shares of

our Company in terms of this Draft Prospectus

Application Form The Form in terms of which the prospective investors shall apply for our

Equity Shares in the Issue

Application Supported by

Blocked Amount/ASBA

The application (whether physical or electronic) by an Applicant to make an

Application authorizing the relevant SCSB to block the Application Amount in

the relevant ASBA Account Pursuant to SEBI Circular dated November 10,

2015 and bearing Reference No. CIR/CFD/POLICYCELL/11/2015 which

shall be applicable for all public issues opening on or after January 01, 2016,

all potential investors shall participate in the Issue only through ASBA process

providing details about the bank account which will be blocked by the SCSBs

ASBA Account Account maintained with an SCSB and specified in the Application Form

which will be blocked by such SCSB to the extent of the appropriate

Application Amount in relation to an Application by an Applicant

ASBA Application

Location(s)/Specified

Cities

Locations at which ASBA Applications can be uploaded by the SCSBs viz,

Mumbai, New Delhi, Chennai, Kolkata, Ahmedabad, Rajkot, Bangalore,

Hyderabad, Pune, Baroda and Surat

ASBA Bid A Bid made by an ASBA Bidder

ASBA Investor/ASBA

Applicant

Any prospective investor(s)/applicants(s) in this Issue who apply(ies) through

the ASBA process in terms of this Draft Prospectus

Banker(s) to the

Issue/Escrow Collection

Bank

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

an Issue with whom the Public Issue Account will be opened and in this case,

being [•] Basis of Allotment The basis on which Equity Shares will be Allotted to the successful Applicants

under the Issue and which is described under chapter titled “Issue Procedure”


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

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

Investor Bid/Issue Period by the Anchor Investors, to subscribe to or purchase

the Equity Shares of our Company at a price within the Price Band, including

all revisions and modifications thereto as permitted under the SEBI

Regulations

Bid Amount Highest value of optional Bids indicated in the Bid cum Application Form and

payable by the Bidder upon submission of the Bid

Bid Lot 2000 Equity Shares

Broker Centers Broker centers notified by the Stock Exchanges where Bidders can submit the

Application Forms to a Registered Broker. The details of such Broker Centers,

along with the names and contact details of the Registered Brokers are

available on the websites of the Stock Exchange.

Broker to the Issue All recognized members of the stock exchange would be eligible to act as the

5

Term(s) Description

Broker to the Issue

CAN/Allotment advice The note or advice or intimation of Allotment, sent to each successful

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

the Basis of Allotment by the Designated Stock Exchange

Client ID Client identification number of the Applicant’s beneficiary account

Collecting Depository

Participant/ CDP

A depository participant as defined under the Depositories Act, 1996,

registered with SEBI and who is eligible to procure Applications at the

Designated CDP Locations in terms of circular no.

CIR/CFD/POLICYCELL/11/2015 dated November 10, 2015 issued by SEBI

Controlling Branches of

the SCSBs

Such branches of the SCSBs which co-ordinate applications under this Issue

by the ASBA Applicants with the Lead Manager, Registrar to the Issue and the

Stock Exchange and a list of which is available at http://www.sebi.gov.in, or at

such other website as may be prescribed by SEBI from time to time

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

occupation and bank account details

Depository A Depository registered with SEBI under SEBI (Depositories and Participant)

Regulations, 1996

Depository Participant/DP A Depository Participant as defined under the Depositories Act.

Designated CDP Locations Such locations of the CDPs where Applicants can submit the Application

Forms to Collecting Depository Participants. The details of such Designated

CDP Locations, along with names and contact details of the Collecting

Depository Participants eligible to accept Application Forms are available on

the website of the Stock Exchange i.e. www.nseindia.com

Designated SCSB

Branches

Such branches of the SCSBs which shall collect the ASBA Forms from the

ASBA Applicants and a list of which is available at www.sebi.gov.in, or at


Designated Date The date on which funds are transferred from the amount blocked by the

SCSBs is transferred from the ASBA Account to the Public Issue Account, as

appropriate, after the Issue is closed, following which the Equity Shares shall

be allotted/transfer to the successful Applicants

Designated

Intermediaries/Collecting

Agent

An SCSB with whom the bank account to be blocked, is maintained, a

syndicate member (or sub-syndicate member), a Registered Broker,

Designated CDP Locations for CDP, a registrar to an issue and Share Transfer

Agent (RTA) (whose names is mentioned on website of the Stock Exchange as

eligible for this activity)

Designated Market Maker/

Market Maker

In our case, [●] having its Registered office at [●] and Corporate office at [●]

Designated RTA Locations Such locations of the RTAs where Applicants can submit the Application

Forms to RTAs. The details of such Designated RTA Locations, along with

names and contact details of the RTAs eligible to accept Application Forms are

available on the website of the Stock Exchange, i.e. www.nseindia.com

Designated Stock

Exchange

National Stock Exchange of India Limited

Draft Prospectus The Draft Prospectus dated September 10, 2018 issued in accordance with

Section 26 of the Companies Act, 2013 and filed with the NSE under SEBI

(ICDR) Regulations, 2009

Eligible NRIs NRIs from jurisdictions outside India where it is not unlawful to make an issue

or invitation under the Issue and in relation to whom this Draft Prospectus

constitutes an invitation to subscribe to the Equity Shares offered herein

Eligible QFIs Qualified Foreign Investors from such jurisdictions outside India where it is

not unlawful to make an offer or invitation under the Issue and in relation to

whom the Prospectus constitutes an invitation to purchase the Equity Shares

offered thereby and who have opened dematerialized accounts with SEBI

registered qualified depositary participants as QFIs and are deemed as FPIs

under the SEBI (Foreign Portfolio Investors) Regulations, 2014

Public Issue Account(s) Account(s) opened with the Public Issue Bank/Banker to the Issue for the Issue

Public Issue Account

Agreement

Agreement entered into by our Company, the Registrar to the Issue, the Lead

Manager, and the Public Issue Bank/Banker to the Issue for collection of the

http://www.nseindia.com/

6

Term(s) Description

Application Amounts

First/Sole Applicant The Applicant whose name appears first in the Application Form or Revision

Form

General Information

Document/GID

The General Information Document for investing in public issues prepared and

issued in accordance with the circulars (CIR/CFD/DIL/12/ 2013) dated

October 23, 2013, notified by SEBI and updated pursuant to the circular

(CIR/CFD/POLICYCELL/11/2015) dated November 10, 2015 and

(SEBI/HO/CFD/DIL/CIR/P/2016/26) dated January 21, 2016 notified by the

SEBI and included in “Issue Procedure” on page 246 of this Draft Prospectus

Issue/Issue Size/ Initial

Public Issue/ Initial Public

Offer/ Initial Public

Offering/Initial Public

Offering/ IPO

Public Issue of 24,00,000 Equity Shares of face value of ₹ 10 each fully paid

of Preet Remedies Limited for cash at a price of ₹51 per Equity Share

(including a premium of ₹41 per Equity Share) aggregating ₹1224 Lakhs

Memorandum of

Understanding/MoU

The agreement dated July, 28 2018 between our Company and the Lead

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

the Issue

Issue Opening Date The date on which Issue opens for subscription

Issue Closing Date The date on which Issue closes for subscription

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

inclusive of both the days during which prospective Investors may submit their

application.

Issue Price The price at which the Equity Shares are being issued by our Company under

this Draft Prospectus being ₹51 per Equity Share of face value of ₹10 each

fully paid

Issue Proceeds Proceeds from the fresh Issue that will be available to our Company, being ₹

1224.00 Lakhs

Listing Agreement The Equity Listing Agreement to be signed between our Company and the

National Stock Exchange of India Limited.

Lead Manager Manager to the Issue, in this case being Mark Corporate Advisors Private

Limited, a SEBI Registered Merchant Banker

Market Maker Market Maker appointed by our Company, in this case being [●] who has

agreed to receive or deliver the specified securities in the market making

process for a period of three years from the date of listing of our Equity Shares

or for any other period as may be notified by SEBI from time to time

Market Making Agreement Market Making Agreement dated [●] between Our Company, Lead Manager

and the Market Maker

Market Maker Reservation

Portion

The Reserved Portion of 1,20,000 Equity Shares of face value of ₹10 each

fully paid for cash at a price of ₹51 per Equity Share aggregating ₹61.20 Lakhs

for the Market Maker in this Issue

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

Regulations, 1996, as amended from time to time

Net Issue The Issue excluding the Market Maker Reservation Portion of 22,80,000

Equity Shares of face value of ₹10 each fully paid for cash at a price of ₹ 51

Equity Share aggregating ₹ 1162.80 Lakhs by our Company

Net Proceeds The Issue Proceeds, less the Issue related expenses, received by the Company.

For further information about use of the Issue Proceeds and the Issue expenses,

please refer to the chapter titled “Objects of the Issue” beginning on Page No.

73 of this Draft Prospectus

Non-Institutional Investors All Applicants that are not Qualified Institutional Buyers or Retail Individual

Investors and who have Applied for Equity Shares for an amount more than

₹2,00,000

OCB/Overseas Corporate

Body

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




(Deposit) Regulations, 2000, as amended from time to time. OCBs are not

7

Term(s) Description

allowed to invest in this Issue

Payment through

electronic transfer of funds

Payment through NECS, NEFT or Direct Credit, as applicable

Person/Persons Any individual, sole proprietorship, unincorporated association,

unincorporated organization, body corporate, corporation, company,

partnership, limited liability company, joint venture, or trust or any other entity

or organization validly constituted and/or incorporated in the jurisdiction in

which it exists and operates, as the context requires

Prospectus The Prospectus to be filed with RoC containing, inter-alia, the issue opening

and closing dates and other information

Public Issue Account Account opened with the Banker to the Issue/Public Issue Bank i.e. [●] by our

Company to receive monies from SCSBs from the bank accounts of the ASBA

Applicants on the Designated Date

Qualified Institutional

Buyers or QIBs

QIBs, as defined under the SEBI ICDR Regulations, including public financial

institutions as specified in Section 2 (72) of the Companies Act, 2013

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

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

individual) registered with SEBI, multilateral and bilateral development

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

capital investor registered with SEBI, state industrial development corporation,

insurance company registered with Insurance Regulatory and Development

Authority, provident fund with minimum corpus of ₹2,500 Lakhs, pension

fund with minimum corpus of ₹2,500 Lakhs, NIF, insurance funds set up and

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

set up and managed by the Department of Posts, India

Refund Account (s) Account(s) to which monies to be refunded to the Applicants shall be

transferred from the Public Issue Account in case listing of the Equity Shares

does not occur

Refund Bank(s)/Refund

Banker(s)

Bank(s) which is / are clearing member(s) and registered with the SEBI as

Bankers to the Issue at which the Refund Accounts will be opened in case

listing of the Equity Shares does not occur, in this case being [●] Bank Limited

Registered Brokers Stock Brokers registered with the Stock Exchanges having nationwide

terminals

Registrar/Registrar to the

Issue

Bigshare Services Private Limited having Registered Office at 1st Floor, Bharat

Tin Works Building, Opp. Vasant Oasis, Makhwana Road, Marol, Andheri

(E), Mumbai-400 059

Retail Individual Investor Individual Applicants, or minors applying through their natural guardians,

including HUFs (applying through their Karta) and ASBA Applicants, who

apply for an amount less than or equal to ₹2,00,000

Revision Form The /form used by the Applicants to modify the quantity of Equity Shares in

any of their Application Forms or any previous Revision Form(s)

Self-Certified Syndicate

Banker/ SCSB

Shall mean a Banker to an Issue registered under SEBI (Bankers to an Issue)

Regulations, 1994, as amended from time to time, and which offer the service

of making Application/s Supported by Blocked Amount including blocking of

bank account and a list of which is available on www.sebi.gov.in or at such

other website as may be prescribed by SEBI from time to time

SME Platform of

NSE/SME

Exchange/NSE EMERGE

The SME Platform of NSE for listing of equity shares offered under Chapter

XB of the SEBI (ICDR) Regulations

Underwriters Mark Corporate Advisors Private Limited

Underwriting Agreement The agreement dated [●] entered into between the Underwriter(s) and our

Company

Working Day “Working Day” means all days, other than second and fourth Saturday of the

month, Sunday or a public holiday, on which commercial banks in Mumbai are

open for business; provided however, with reference to Issue Period, “Working

Day” shall mean all days, excluding all Saturdays, Sundays or a public

holiday, on which commercial banks in Mumbai are open for business; and

with reference to the time period between the Issue Closing Date and the

8

Term(s) Description

listing of the Equity Shares on the SME Exchange of National Stock

Exchange of India Limited, “Working Day” shall mean all trading days of

National Stock Exchange of India Limited, excluding Sundays and bank

holidays, as per the SEBI Circular SEBI/HO/CFD/DIL/CIR/P/2016/26 dated

January 21, 2016

Technical and Industry Related Terms:

Term(s) Description

AIDS Acquired Immune Deficiency Syndrome

CCIM The Central Council of Indian Medicine

CCRAS The Central Council for Research in Ayurveda and Siddha

CCRIMH Central Council for Research in Indian Medicine and Homoeopathy

CHEMEXIL Basic Chemicals, Pharmaceuticals and Cosmetics Exports promotion Council

ETP Effluent Treatment Plant

F&D Formulations and Development

GATT General Agreement on Trade and Tariffs

GLP Good Laboratory Practices Norms

GMP Good Manufacturing Practices

GP General Practitioners

GWP Good Working Practices

HIV Human Immune Virus

IMCC The Indian Medicine Central Council

ISO The International Organization for Standardization

Lab Laboratory

OTC Over the Counter

PRD Process Research Development

R&D Research & Development

Conventional and General Terms or Abbreviations:

Term(s) Description

A/c Account

Act The Companies Act, 2013

AGM Annual General Meeting

Articles Articles of Association of the Company framed in pursuance of this Act

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

India

AY Assessment Year

ASBA Applications Supported by Blocked Amount

BIFR Board for Industrial and Financial Reconstruction

CAGR Compounded Annual Growth Rate

CDSL Central Depository Services (India) Limited

CESTAT Customs, Excise and Service Tax Appellate Tribunal

CENVAT Central Value Added Tax

CIN Corporate Identification Number

Companies Act Companies Act, 2013

CSO Central Statistical Organization

Depositories

NSDL and CDSL, Depositories registered with the SEBI under the Securities

and Exchange Board of India (Depositories and Participants) Regulations,

1996, as amended from time to time.

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

DIN Director Identification Number

DP Depository Participant

DP ID Depository Participant’s Identity

9

Term(s) Description

DB Designated Branch

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

items

ECS Electronic Clearing Services

EGM Extraordinary General Meeting

ESIC Employee State Insurance Corporation

ESOP Employee Stock Option Plan

EPS Earnings per Share

FDI Foreign Direct Investment

FCNR Account Foreign Currency Non-Resident Account

FEMA Foreign Exchange Management Act, as amended from time to time and the

regulations framed there under

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

Regulations, 2000 and amendments thereto.

FII(s) Foreign Institutional Investors

FIs Financial Institutions

FIPB The Foreign Investment Promotion Board, Ministry of Finance, Government of

India

FV Face Value

FVCI Foreign Venture Capital Investor registered under the Securities and Exchange

Board of India (Foreign Venture Capital Investor) Regulations, 2000

FY Financial Year

GAAP Generally Accepted Accounting Principles

GDP Gross Domestic Product

GOI Government of India.

HNI High Net Worth Individual

HUF Hindu Undivided Family

ICDR Regulations/ SEBI

Regulations/ SEBI (ICDR)

Regulations

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

amended from time to time

Indian GAAP Generally accepted accounting principles in India

ICAI Institute of Chartered Accountants of India

ICSI Institute of Company Secretaries of India

IFRS International financial reporting standards

Ind AS Indian Accounting Standards

IPC Indian Penal Code

IPO Initial Public Offering

IPR Intellectual Property Right

IT Information Technology

IT Act The Income-tax Act, 1961 as amended from time to time except as stated

otherwise

IT Rules The Income-tax Rules, 1962, as amended from time to time

INR Indian National Rupee

JV Joint venture

KMP

The officers declared as a Key Managerial/Management Personnel and as

mentioned in the chapter titled “Our Management” beginning on page 123 of

this Draft Prospectus

Ltd. Limited

MBA Master in Business Administration

M.Com Master Degree in Commerce

MD Managing Director

MoU Memorandum of Understanding

MNC Multinational Corporation

N/A or NA Not Applicable

NAV Net Asset Value

NECS National Electronic Clearing Services

NEFT National Electronic Fund Transfer

10

Term(s) Description

Net Worth

The aggregate of the paid-up share capital, share premium account, and

reserves and surplus (excluding revaluation reserve) as reduced by the

aggregate of miscellaneous expenditure (to the extent not adjusted or written

off) and the debit balance of the profit and loss account

NOC No Objection Certificate

NPV Net Present Value

NR Non-Resident

NRE Account Non-Resident External Account

NRI

Non-Resident Indian, is a person resident outside India, who is a citizen of

India or a person of Indian origin and shall have the same meaning as ascribed

to such term in the Foreign Exchange Management (Deposit) Regulations,

2000, as amended from time to time

NRO Account Non-Resident Ordinary Account

NSDL National Securities Depository Limited

p.a. per annum

PAN Permanent Account Number

PAT Profit After Tax

Pvt. Private

PBT Profit Before Tax

P/E Ratio Price Earnings Ratio

POA Power of Attorney

PIO Persons of Indian Origin

QIB Qualified Institutional Buyer

RBI Reserve Bank of India

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

Ron Return on Net Worth.

Rs./INR/₹ Indian Rupees

RTGS Real Time Gross Settlement

SCRA Securities Contracts (Regulation) Act, 1956

SCRR Securities Contracts (Regulation) Rules, 1957

SCSB Self-Certified Syndicate Bank

SEBI Securities and Exchange Board of India.

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

time.

SEBI Depository

Regulations

Securities and Exchange Board of India (Depositories and Participants)

Regulations, 1996

SEBI ICDR Regulations Securities and Exchange Board of India (Issue of Capital and Disclosure

Requirements) Regulations, 2009

SEBI LODR Regulations Securities and Exchange Board of India (Listing Obligations and Disclosure

Requirements) Regulations, 2015

SEBI Insider Trading

Regulations

The SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended from

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

to time

SEBI Takeover

Regulations/Takeover

Regulations/Takeover

Code

Securities and Exchange Board of India (Substantial Acquisition of Shares and

Takeovers) Regulations, 2011, as amended from time to time, including

instructions and clarifications issued by SEBI from time to time

Sec Section

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

time to time

SSI Undertaking Small Scale Industrial Undertaking

Stock Exchange(s) National Stock Exchange of India Limited

Sq. Square

Sq. Mtr. Square Meter

TAN Tax Deduction Account Number

TRS Transaction Registration Slip

TIN Taxpayers Identification Number

11

Term(s) Description

TNW Total Net Worth

u/s Under Section

UIN Unique Identification Number

US/ U.S. / USA United States of America

USD or US$ United States Dollar

U.S. GAAP Generally accepted accounting principles in the United States of America

UOI Union of India

Venture Capital

Fund(s)/VCF(s)

Venture capital funds as defined and registered with SEBI under the Securities

and Exchange Board of India (Venture Capital Fund) Regulations, 1996, as

amended from time to time

WDV Written Down Value

w.e.f. With effect from

YoY Year over Year

Notwithstanding the foregoing:

In ‘Main Provisions of the Articles of Association’ beginning on No. 288 of this Draft Prospectus, defined terms

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

In ‘Summary of Our Industry’ and ‘Our Business’ on Page Nos. 42 and 44 respectively, of this Draft Prospectus,

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

In ‘Risk Factors’ on Page No. 15 of this Draft Prospectus, defined terms shall have the meaning given to such

terms in that section.

In ‘Statement of Possible Special Tax Benefits’ on Page No. 81 of this Draft Prospectus, defined terms shall

have the meaning given to such terms in that section.

In ‘Management’s Discussion and Analysis of Financial Conditions and Results of Operations’ on Page No.204

of this Draft Prospectus, defined terms shall have the meaning given.

12

USE OF FINANCIAL INFORMATION AND MARKET DATA AND CURRENCY OF

PRESENTATION

In this Prospectus, the terms “we”, “us”, “our”, the “Company”, “our Company”, “Preet Remedies Limited” and

“Preet”, unless the context otherwise indicates or implies, refers to Preet Remedies Limited.

Financial Data

Unless stated otherwise, the financial data in this Draft Prospectus is derived from our restated financial

statements for the financial years ended March 31, 2014, 2015, 2016, 2017 and 2018 prepared in accordance

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

Indian GAAP which are included in this Prospectus, and set out in ‘Financial Statements’ on Page No. 151 of

this Prospectus.

Our Company’s financial year commences on April 1 of the immediately preceding calendar year and ends on

March 31 of that particular calendar year, so all references to a particular financial year are to the 12 month

period commencing on April 1 of the immediately preceding calendar year and ending on March 31 of that

particular calendar year.

There are significant differences between the Indian GAAP, the International Financial Reporting Standards (the

“IFRS”) and the Generally Accepted Accounting Principles in the United States of America (the “U.S.

GAAP”).Accordingly, the degree to which the financial statements included in this Prospectus will provide

meaningful information is entirely dependent on the reader’s level of familiarity with Indian accounting

practices. Any reliance by persons not familiar with Indian accounting practices, the Indian GAAP, the

Companies Act and the SEBI (ICDR) Regulations on the financial disclosures presented in this Prospectus

should accordingly be limited. We have not attempted to quantify the impact of the IFRS or the U.S. GAAP on

the financial data included in this Prospectus, nor do we provide a reconciliation of our financial statements to

those under the U.S. GAAP or the IFRS and we urge you to consult your own advisors regarding such

differences and their impact on our financial data.

Certain figures contained in this Prospectus, including financial information, have been subject to rounding

adjustments. All decimals have been rounded off to two decimal points, except for figures in percentage. In

certain instances, (i) the sum or percentage change of such numbers may not conform exactly to the total figure

given; and (ii) the sum of the numbers in a column or row in certain tables may not conform exactly to the total

figure given for that column or row. However, where any figures that may have been sourced from third-party

industry sources are rounded off to other than two decimal points in their respective sources, such figures appear

in this Prospectus as rounded off to such number of decimal points as provided in such respective sources.

Currency and units of Presentation

In this Prospectus, unless the context otherwise requires, all references to (a) ‘Rupees’ or ‘₹’ or ‘Rs.’ or ‘INR’

are to Indian rupees, the official currency of the Republic of India; (b) ‘US Dollars’ or ‘US$’ or ‘USD’ or ‘$’

are to United States Dollars, the official currency of the United States of America. All references to the word

‘Lakh’ or ‘Lac’ or ‘Lacs’, means ‘One hundred thousand’ and the word ‘Million’ means ‘Ten lakhs’ and the

word ‘Crore’ means ‘Ten Million’ and the word ‘Billion’ means ‘One thousand Million’.

Any percentage amounts, as set forth in "Risk Factors", "Our Business", "Management's Discussion and

Analysis of

Financial Conditions and Results of Operation" and elsewhere in this Prospectus, unless otherwise indicated,

have been calculated based on our restated financial statement prepared in accordance with Indian GAAP.

Industry and Market Data

Unless stated otherwise, industry and market data used throughout this Prospectus has been obtained or derived

from internal Company reports and industry and government publications, publicly available information and

sources. Industry publications generally state that the information contained in those publications has been

obtained from sources believed to be reliable but that their accuracy and completeness are not guaranteed and

their reliability cannot be assured. Although, our Company believes that industry data used in this Prospectus is

reliable, it has not been independently verified.

13

Further, the extent to which the industry and market data presented in this Prospectus is meaningful depends on

the reader's familiarity with and understanding of, the methodologies used in compiling such data. There are no

standard data gathering methodologies in the industry in which we conduct our business, and methodologies and

assumptions may vary widely among different industry sources.

14

FORWARD LOOKING STATEMENTS

All statements contained in this Prospectus that are not statements of historical facts constitute ‘forward-looking

statements’. All statements regarding our expected financial condition and results of operations, business,

objectives, strategies, plans, goals and prospects are forward-looking statements. These forward-looking

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

other matters discussed in this Prospectus regarding matters that are not historical facts. These forward looking

statements and any other projections contained in this Prospectus (whether made by us or any third party) are

predictions and involve known and unknown risks, uncertainties and other factors that may cause our actual

results, performance or achievements to be materially different from any future results, performance or

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

These forward looking statements can generally be identified by words or phrases such as “will”, “aim”, “will

likely result”, “believe”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”,

“seek to”, “future”, “objective”, “goal”, “project”, “should”, “will pursue” and similar expressions or variations

of such expressions. Important factors that could cause actual results to differ materially from our expectations

include but are not limited to:

General economic and business conditions in the markets in which we operate and in the local, regional and

national and international economies;

Our ability to successfully implement strategy, growth and expansion plans and technological initiatives;

Our ability to respond to technological changes;

Our ability to attract and retain qualified personnel;

The effect of wage pressures, seasonal hiring patterns and the time required to train and productively utilize

new employees;

General social and political conditions in India which have an impact on our business activities or

investments;

Potential mergers, acquisitions restructurings and increased competition;

Occurrences of natural disasters or calamities affecting the areas in which we have operations;

Market fluctuations and industry dynamics beyond our control;

Changes in the competition landscape;

Our ability to finance our business growth and obtain financing on favorable terms;

Our ability to manage our growth effectively;

Our ability to compete effectively, particularly in new markets and businesses;

Changes in laws and regulations relating to the industry in which we operate changes in government policies

and regulatory actions that apply to or affect our business;

Developments affecting the Indian economy; and

Inability to meet our obligations, including repayment, financial and other covenants under our debt

financing arrangements.

For a further discussion of factors that could cause our current plans and expectations and actual results to differ,

please refer ‘Risk Factors’, ‘Our Business’ and ‘Management’s Discussion and Analysis of Financial Condition

and Results of Operations’ on page nos 15, 93 and 204 respectively of this Prospectus.

Forward looking statements reflects views as of the date of this Prospectus and not a guarantee of future

performance. By their nature, certain market risk disclosures are only estimates and could be materially different

from what actually occurs in the future. As a result, actual future gains or losses could materially differ from

those that have been estimated. Neither our Company/our Directors nor the Lead Managers, nor any of its

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

the date hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come

to fruition. In accordance with SEBI requirements, our Company and the Lead Managers will ensure that

investors in India are informed of material developments until such time as the listing and trading permission is

granted by the Stock Exchange.

15

SECTION II - RISK FACTORS

An investment in our Equity Shares involves a high degree of financial risk and you should carefully consider

all information disclosed in this Draft Prospectus, including the risks and uncertainties described below, before

making an investment in our Equity Shares. The risk factors set forth below are not exhaustive and do not

purport to be complete or comprehensive in terms of all the risk factors that may arise in connection with our

business or any decision to purchase, own or dispose of the Equity Shares. This section addresses general risks

associated with the industry in which we operate and specific risks associated with our Company. If any, or

some combination, of the following risks actually occurs, our business, prospects, results of operations and

financial condition could suffer, the trading price of our Equity Shares could decline and you may lose all or

part of your investment. In making an investment decision, prospective investors must rely on their own

examination of our Company and the Issue, including the merits and risks involved. Additional risks and

uncertainties, whether known or unknown, may in the future have material adverse effect on our business,

financial condition and results of operations, or which we currently deem immaterial, may arise or become

material in the future. Unless specified or quantified in the relevant risk factors set forth below, we are not in a

position to specify or quantify the financial or other risks mentioned herein. Investors are advised to read the

risk factors carefully before taking an investment decision in this Issue. Investors should not invest in this Issue

unless they are prepared to accept the risk of losing all or part of their investment, and they should consult their

tax, financial and legal advisors about the particular consequences to you of an investment in the Equity Shares.

This Draft Prospectus also contains forward-looking statements that involve risks and uncertainties. We have

described the risks and uncertainties that our management believes are material, but these risks and

uncertainties may not be the only ones we face. Our actual results could differ materially from those anticipated

in these forward-looking statements as a result of certain factors, including events described below and

elsewhere in this Draft Prospectus. Unless otherwise stated, the financial information used in this section is

derived from and should be read in conjunction with Restated Financial Statements of our Company for the

Fiscals 2014, 2015, 2016, 2017 and 2018 in each case prepared in accordance with Indian GAAP, including the

schedules, annexure and notes thereto.

To obtain a better understanding of our business, you should read this section in conjunction with other

chapters of the Draft Prospectus, including the chapters titled "Our Business" and "Management’s Discussion

and Analysis of Financial Condition and Results of Operations" and section titled "Financial Information of the

Company" beginning on pages 93,204 and 151 respectively of this Draft Prospectus, together with all other

financial information contained in the Draft Prospectus.

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

considered for determining the materiality.

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

2. Some risks may have material impact qualitatively instead of quantitatively.

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

1. We are involved in certain legal proceedings, any adverse developments related to which could materially

and adversely affect our business, reputation and cash flows.

Our Company, our Associate Company, our Promoters and Directors are involved in certain legal proceedings,

which if determined, against us could have adverse impact on the business and financial results of our Company.

For further details, please refer to the chapter titled "Outstanding Litigation and Material

Developments"beginning on page 213 of this Draft Prospectus. A brief detail of such outstanding litigations as

on the date of this Draft Prospectus are as follows:

Entity No. of cases Total outstanding demand (In Rs.)

LITIGATION AGAINST OUR COMPANY:

Litigation involving criminal laws

17 -

Litigation Involving Actions by Statutory/Regulatory Authorities

Nil -

Litigation involving tax liabilities

(i) Direct Tax Liabilities

16


1 -

(ii) Indirect Tax Liabilities

Nil -

Other material pending litigation

Nil -

LITIGATION BY OUR COMPANY:

Litigation Involving Criminal Laws

Nil -


Nil -

Litigation Involving Tax Liabilities


Nil -


Nil -


Nil -

LITIGATION AGAINST OUR DIRECTORS AND PROMOTERS:


8 -


Nil -



1 12,87,532


Nil -


1 -

LITIGATION BY OUR DIRECTORS/PROMOTERS:


1 -


Nil -



Nil -


Nil -


1 7,29,541 plus 18% interest

LITIGATION AGAINST OUR GROUP COMPANIES:


1 -


Nil -


Direct Tax Liabilities

1 6,28,050

Indirect Tax Liabilities

Nil -


3 1,06,000

LITIGATION BY OUR GROUP COMPANIES:

Litigation Involving Criminal Laws

17


Nil -


Nil -

Litigation Involving Tax Liabilities


Nil -

Indirect Tax Liabilities

Nil -


1 10,00,400

2. There are certain criminal complaints against our Company in relation to the non-compliance under the

Drugs and Cosmetics Act, 1940 which if proven may lead to monetary penalties and imprisonment of our

Directors.

There are certaincriminal complaints under the Drugs and Cosmetics Act 1940 against our Company which are

pending at various magistrate courts. The complaints have been filed alleging that our Company has failed to

maintain the quality standards required to be maintained under the Drugs and Cosmetics Act, 1940. If our

Company fails to comply with the provisions which define the standards of quality under the Drugs and

Cosmetics Act, 1940, our Company will be held liable for punishment which could include imposing monetary

penalties and imprisonment of our Directors or officers held to be responsible for such non-compliance. While,

we believe that our Company has fulfilled all the quality standards required to be maintained under the said

Drugs and Cosmetics Act, 1940, we cannot assure you that there shall not be any future complaints regarding

lapses or failure by the Company to maintain the required standards and norms in the future. Any adverse order

against the Company imposing penalties in the nature of fine or imprisonment of our Directors could have a

material adverse on our reputation, financial condition and results of operation. Further, while some matters

have been disposed, we cannot assure you that there will not be further proceedings or appeals in the same. For

further details, please refer to the chapter titled "Outstanding Litigation and Material Developments" beginning

on page 213 of this Draft Prospectus. 3. Our Company is not in possession of documents pertaining to certain litigation described in the chapter

titled "Outstanding Litigation and Material Developments".

Our Company is not in possession of documents pertaining to certain litigation described in the chapter titled

"Outstanding Litigation and Material Developments" beginning on page 213 of the Draft Prospectus.

Accordingly, reliance has been placed on the undertakings furnished by the Company to describe the facts of

litigation in the aforesaid chapter. Therefore, we cannot assure you that all information pertaining to the above is

accurate. Further, with respect to the following matters, we have no papers at all and hence the facts regarding

these matters have not been included in the chapter titled "Outstanding Litigation and Material Developments".

Our Company

1. The State of Maharashtra through Miss. Shrutika kamalsing Jadhav. Vs Preet Remedies Pvt.Ltd, Swapan

Chakraborti (Pune)

Quixotic Healthcare

1. Indchemic Health Specialities Pvt. Ltd. vs. Quixotic Healthcare

2. Two Karimnagar Cases (Drug Inspector)

3. State of Maharashtra vs. Quixotic Healthcare (Vasai)

4. State of Maharashtra vs. Quixotic Healthcare (Georai, Beed)

Oasis Pharma & Phytomolecules Private Limited

1. Oasis Pharma & Phytomolecules Private Limited vs. Mohinder Pal Singh & others (CM(M) 714/2018)

2. Oasis Pharma & Phytomolecules Private Limited vs. Mohinder Pal Singh & others (CM(M) 714/2018)

3. Mohinder Pal Singh vs. Oasis Pharma & Phytomolecules Private Limited (CS/590/2016)

4. Mohinder Pal Singh vs. Oasis Pharma & Phytomolecules Private Limited (Cr Rev/47405/2015)

18

Sanjay Dhir

1. Drug Inspector Hassan Circle Hassan vs. Sanjay Dhir

Swapan Chakraborti

1. The State of Maharashtra through Miss. Shrutika kamalsing Jadhav. Vs Preet Remedies Pvt.Ltd, Swapan

Chakraborti (Pune)

Harpreet

1. Drug Inspector vs. Preet Remedies Limited -rep Harpreet Singh (Ottappalam)

The above information is based solely on the search results carried out on various courts. Hence, we cannot fully

ascertain the liability (monetary or otherwise against our Company) pertaining to these litigations. Also, for

certain cases mentioned above, while they appear listed in the respective courts, our Company has not received

any summons pertaining to the same. Further, while some matters have been disposed, we cannot assure you

that there will not be further proceedings or appeals in the same.

4. We do not own our Registered Office and other premises from which we operate.

Our registered office situated atPlot no. 194-195, 3rd Floor, Industrial Area Phase-II, Chandigarh-160002is taken

on lease basis from Mr. Manmohan Singh Chadha and Prithipal Singh Chadhafor a period of Nine years from

July 01, 2010 to June 30, 2019. Our manufacturing plant and godown situated at Plot No 183-186, HPSIDC

Industrial Area Baddi Distt Solan (HP) owned by the company. For further details in relation to our properties,

please refer to the chapter titled "Our Business" beginning on page 93 of the Draft Prospectus. We cannot assure

you that we will be able to renew our leases on commercially acceptable terms or at all. In the event that we are

required to vacate the aforementioned premises, we would be required to make alternative arrangements for new

offices and other infrastructure and we cannot assure that the new arrangements will be on commercially

acceptable terms. If we are required to relocate our business operations during this period, we may suffer a

disruption in our operations or have to pay increased charges, which could have an adverse effect on our

business, prospects, results of operations and financial condition.

5. Being a pharmaceutical company, we operate in a highly regulated and controlled industry. Any change

in regulatory environment may have an impact on the business of the Company.

Being a pharmaceutical company, we operate in an industry which is highly regulated and controlled. The

industry has extensive regulations pertaining to research, testing, and manufacturing, quality standards, selling

and marketing of pharmaceutical products. Regulatory authorities in each of these markets must approve our

products before our Company or our distribution agents can market them. Applicable regulations have become

increasingly stringent, a trend which may continue in the future. The penalties for non-compliance with these

regulations can be severe, including the revocation or suspension of our business license, imposition of fines and

criminal sanctions in those jurisdictions. Regulatory agencies may at any time inspect our manufacturing

facilities for the quality of our products. If any inspection or quality assessment results in observations/ alerts or

sanctions, the relevant regulator may amend or withdraw our existing approvals to manufacture and market our

products in such jurisdiction, which could adversely affect our business, financial condition and results of

operations. If we fail to comply with applicable statutory or regulatory requirements, there could be a delay in

the submission or grant of approval for the manufacturing and marketing new products. Moreover, if we fail to

comply with the various conditions attached to such approvals, licenses, registrations and permissions once

received, the relevant regulatory body may suspend, curtail or revoke our ability to market such products or

impose fines upon us. The time taken to obtain approvals varies by country, but generally takes between six

months and several years from the date of application. If we fail to obtain such approvals, licenses, registrations

and permissions, in a timely manner or at all, our business, results of operations and financial condition could be

adversely affected.

We believe that our Company keeps itself abreast of the various developments relating to the regulatory

environment and gears itself in order to comply with such regulatory changes, application and the renewal of

regulatory approvals. However, in case our Company is unable to adapt itself to such regulatory changes, obtain

the necessary approvals / renewals for all our products the business of the Company may be impacted adversely.

19

6. Reforms in the health care industry and the uncertainty associated with pharmaceutical pricing,

reimbursement and related matters could adversely affect the pricing and demand for our products.

In India, pharmaceutical prices are subject to regulation and the Government has been actively reviewing prices

for pharmaceuticals and margins offered to trade. The existence of price controls can limit the revenues we earn

from our products. India enacted the National Pharmaceuticals Pricing Policy in 2012, which lays down the

principles for pricing essential drugs. As a result, a number of drug formulations were identified as essential

drugs and were added to India’s National List of Essential Medicines and these drugs are subjected to price

controls in India. On May 15, 2013, the Department of Pharmaceuticals released the revised DPCO 2013 (which

replaced the earlier Drugs (Prices Control) Order, 1995). The DPCO 2013 governs the price control mechanism

for formulations listed in the National List of Essential Medicines. Under the DPCO 2013, the price of

scheduled drugs is determined on the basis of the average market price of the relevant drug, arrived at by

considering the prices charged by all companies that have a market share of equal to or more than 1.0% of the

total market turnover on the basis of moving annual turnover of the drug.

The DPCO 2013 was amended in 2016 and the Drugs (Price Control) Amendment Order, 2016 fixed or revised

ceiling prices of certain formulations under the DPCO. The NPPA may also notify the ceiling price for

additional formulations under the DPCO or some or all of the remaining formulations listed in the National List

of Essential Medicines.

Under terms of the DPCO 2013, non-compliance with the notified ceiling price or breaching the ceiling price

would be tantamount to overcharging the consumer under the order, and the amount charged over and above the

ceiling price shall be recovered along with interest thereon from the date of overcharging. Further,

noncompliance with the price notification issued by NPPA, could also attract prosecution of the officers of the

company under the Essential Commodities Act, 1955 including imprisonment for a term of up to seven years

and shall also be liable to pay a fine. Any action against us or our management for violation of the DPCO 2013

may divert management attention and could adversely affect our business, prospects, results of operations and

financial condition.

Further, if our ability to freely set prices for our products is restricted by government regulation, healthcare

legislation and pressure from third parties, our revenues and our profits may be reduced. While we cannot

predict the nature of the measures that may be adopted by governmental organizations or their effect on our

business and revenues, the announcement or adoption of such proposals may affect our result of operations.

7. Any manufacturing or quality control problems may damage our reputation for high quality production

and expose us to potential litigation or other liabilities, which would negatively impact our business,

prospects, results of operations and financial condition.

Pharmaceutical manufacturers are subject to significant regulatory scrutiny in most jurisdictions. Our

manufacturing unit located at Baddi, Himachal Pradesh manufactures products in accordance with stipulated

manufacturing practices. We must register our facilities with regulatory authorities and our products must be

made in a manner consistent with good manufacturing practices ("GMP") or similar standards stipulated by

concerned regulatory authorities. In addition, we are required to meet various quality standards and

specifications for our customers under our contracts with the customers.

Furthermore, we are liable for the quality of our products during the entire shelf life of the product. We also face

the risk of loss resulting from any adverse publicity, any contamination of our products by intermediaries, re-

review of products that are already marketed, new scientific information, greater scrutiny in advertising and

promotion, the discovery of previously unknown side effects or the recall or loss of approval of products that we

manufacture, market or sell.

Disputes over non-conformity of our products with such quality standards or specifications are generally

referred to independent government approved testing laboratories. If any such independent laboratory confirms

that our products do not conform to the prescribed or agreed standards and specifications, we would bear the

expenses of replacing and testing such products, which could adversely affect our business, results of operations

and financial condition.

We also face the risk or loss resulting from product liability lawsuits, whether or not such claims are valid. A

20

successful product liability claim may require us to pay substantial sums and may adversely affect our results of

operations and financial condition.

8. Stricter marketing norms prescribed by a new code of conduct in India for companies doing business in

the pharmaceuticals industry could affect our ability to effectively market our products which may affect

our profitability.

In 2014, the Ministry of Chemicals and Fertilizers, Department of Pharmaceuticals, Government of India

introduced Uniform Code of Pharmaceuticals Marketing Practices (UCPMP) with effect from January 1, 2015.

This code of conduct for marketing practices for the Indian pharmaceutical industry is expected to be voluntarily

adopted by pharmaceutical companies.

The UCPMP amongst other things provides detailed guidelines about promotional materials, conduct of medical

representatives, physician samples, gifts and relationships with healthcare professionals. For example, under the

UCPMP, pharmaceutical companies may not supply or offer any gifts, pecuniary advantages or benefits in kind

to persons qualified to prescribe or supply drugs. Further, the management of the company is responsible for

ensuring adherence to the UCPMP and a self-declaration is required to be submitted by the management within

two months of the closure of every financial year to the industry association. Although these guidelines are

voluntary in nature, they may be codified in the future and we may have to spend a considerable amount of time

and resources to conform to the requirements of the UCPMP.

9. Our success depends on our ability to commercialize new products in a timely manner.

Our success largely depends upon our ability to commercialize new pharmaceutical products across domestic

markets. We must successfully develop, test and manufacture generic products and all of our products must

meet and continue to comply with regulatory and safety standards and receive regulatory approvals from

appropriate authorities. The process of commercialization of pharmaceutical formulations is time-consuming,

involves significant investments and entails a high degree of business risk. Our overall profitability depends on,

among other things, our ability to introduce new generic products in a timely manner, to continue to

manufacture products cost-efficiently and to manage the life cycle of our global generic portfolio.

The time for commercial launch of a product varies between six months to three years and involves multiple

stages during which the product may be abandoned as a result of factors such as, the inability to obtain

necessary regulatory approvals in a timely manner or at all, and the inability to produce and market such new

products successfully and profitably. Delays in any part of the process or our inability to obtain regulatory

approvals for our products could have a material adverse effect on our business, prospects, results of operations

and financial condition by restricting or delaying the introduction of new products.

10. Our performance may be adversely affected if we are not successful in assessing demand for our

products and managing our inventory.

We evaluate our production requirements according to anticipated demand based on forecasted customer order

activity for our products. Our inventory balances of materials are influenced by our production requirements,

shelf life of the raw materials, expected sourcing levels and changes in our product sales mix.

It is important for us to anticipate demand for our products and any failure to anticipate, identify, interpret and

react on the basis of anticipated/ desired demand or our failure to generate consumer acceptance or recognition

of our new products, could lead to, among others, reduced demand for our products, which can adversely affect

our results of operations. Further, the capacity of our current plant located at Baddi, Himachal Pradesh unit is

not fully utilized, consecutively, if it continues so, it could affect our ability to fully absorb fixed costs and thus

may adversely impact our financial performance. For details regarding capacity of our plant, please refer to the

chapter titled "Our Business" beginning on page 93 of this Draft Prospectus.

Efficient inventory management is also a key component for the success of our business, results of operations

and profitability. To be successful, we must maintain sufficient inventory levels to meet demand for our

products, without allowing those levels to increase to such an extent that the costs associated with storing and

holding the inventory adversely affects our results of operations. If our decisions to purchase raw materials do

not accurately predict sourcing levels or our expectations about demand for our products are inaccurate, we may

either not be able to manufacture products to service the demands, resulting in us having to cede market share to

21

competitors or would have to take unanticipated markdowns or impairment charges to dispose of the excess or

obsolete inventory, which can adversely affect our results of operations.

11. Our Company’s expected production levels could be adversely affected by various factors.

Manufacturers of pharmaceutical products often encounter difficulties in production. These problems include

difficulties with production costs and yields, product quality (caused by, among other things, process failure,

equipment failure, human errors or other unforeseen events during the production cycle) and shortages of

qualified personnel, as well as compliance with regulatory requirements, including GMP requirements. Because

of the many steps involved in the production of pharmaceutical products, any interruption in one of the steps in

the manufacturing process could cause delays in the entire production cycle. In addition, any material labour

problems, such as a work stoppage or mechanical failure or malfunction could likewise lead to delays in

production. Any of these problems could result in delay or suspension of production and may entail higher costs

or other installment expenses. Furthermore, if our Company‘s suppliers fail to deliver necessary manufacturing

equipment, raw materials or adequately perform the services outsourced by our Company to them, production

deadlines may not be met. Any such developments could have a material adverse effect on our Company’s

business and financial operations.

12. Our Company has no formal supply agreement or contract with most of our vendors/suppliers for the

uninterrupted supply of major raw materials and traded goods. Our business may be adversely affected if

there is any disruption in the raw material supply or few traded goods.

We do not have any formal agreements with our most of the vendors/suppliers and we operate on a purchase

order system. Due to the absence of any formal agreement with most of our vendors/suppliers, we are exposed

to the risks of irregular supplies or no supplies at all and delayed supplies which would materially affect our

results of operations. In the event of any disruption in the raw materials/traded goods supply or the non-

availability of raw materials/traded goods, the production and dispatch schedule may be adversely affected

impacting the sales and profitability of the Company. In the event the prices of such raw materials/traded goods

were to rise substantially, we may find it difficult to make alternative arrangements for supplies of our raw

materials/traded goods, on the terms acceptable to us, which could materially affect our business, results of

operations and financial condition. We believe that we maintain good relations with our suppliers and we shall

also not face any challenge in finding new suppliers if required.

13. Certain commercial agreements entered into by us impose several contractual obligations upon us. If we

are unable to meet these contractual obligations and / or our customers perceive any deficiency in our

service we may face legal liabilities and consequent damage to our reputation which may in-turn

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

The commercial agreements entered into by us impose several contractual obligations upon us including

compliance with certain quality norms, non-infringement, confidentiality, non-compete clauses and completion

schedules as is typical of agreements entered into by companies in pharmaceutical sector. If we cannot perform

the services undertaken by us in accordance with the requisite quality norms or if our client’s proprietary rights

are infringed by our employees in violation of any applicable confidentiality agreements and / or our customers

perceive any deficiency or delay in service or breach of stipulated terms of these agreements, our customers may

consider us liable for that act and seek damages from us.

In the ordinary course of our business we enter into some contracts which may be terminable by our clients

without cause on a short notice period affecting our business and creating uncertainty about our revenue flow at

a particular point of time. Further, certain of the commercial agreements that we have entered into restrict us

from providing services to competitors of our existing customers or restrict our ability to approach customers in

certain jurisdictions.

Such clauses may restrict our ability to offer services to customers on terms preferred by ourcustomers/ more

favourable than those offered by our competitors. Further, given the stringentnature of obligations imposed by

our commercial contracts, we face the risk of potential liabilitiesfrom lawsuits or claims by our customers for

the breach of the terms of our contractual obligationsand cannot assure you that such restrictions will not have

an adverse effect on our business,financial condition and results of operations in the future.

14. The availability of counterfeit drugs, such as drugs passed off by others as our products, could adversely

affect our goodwill and results of operations.

22

Other entities could pass off their own products as ours, including counterfeit or pirated products. For example,

certain entities could imitate our brand name, packaging materials or attempt to create look-alike products. As a

result, our market share could be reduced due to replacement of demand for our products and adversely affect

our goodwill. The proliferation of counterfeit and pirated products, and the time and attention lost to defending

claims and complaints about counterfeit products could have an adverse effect on our goodwill and our business,

prospects, results of operations and financial condition could suffer.

15. We may not be able to implement our business strategies or sustain and manage our growth, which may

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

Our growth strategy includes expanding our existing business and product portfolio in specific therapeutic areas.

We cannot assure you that our growth strategies will be successful or that we will be able to continue to expand

further or diversify our product portfolio.

Our ability to sustain and manage our growth depends significantly upon our ability to manage key issues such

as selecting, recruiting, training and retaining marketing representatives, growing the number of doctors

prescribing our products and the number of prescriptions for our products, maintaining effective risk

management policies, continuing to offer products which are relevant to our consumers, developing and

maintaining our manufacturing facility and ensuring a high standard of product quality. Our failure to do any of

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

16. Compliance with, and changes in, safety, health and environmental laws and various labor, workplace

and related laws and regulations including terms of approvals granted to us, may increase our

compliance costs and as such adversely affect our business, prospects, results of operations and financial

condition.

We are subject to a broad range of safety, health, environmental, labour, workplace and related laws and

regulations in the jurisdictions in which we operate, which impose controls on the disposal and storage of raw

materials, noise emissions, air and water discharges; on the storage, handling, discharge and disposal of

chemicals, employee exposure to hazardous substances and other aspects of our operations. For example, laws

in India limit the amount of hazardous and pollutant discharge that our manufacturing facility may release into

the air and water. The discharge of substances that are chemical in nature or of other hazardous substances into

the air, soil or water beyond these limits may cause us to be liable to regulatory bodies and incur costs to remedy

the damage caused by such discharges. Any of the foregoing could subject us to litigation, which may increase

our expenses in the event we are found liable, and could adversely affect our reputation.

Additionally, for any non-compliance, the government or the relevant regulatory bodies may require us to shut

down our manufacturing facility, which in turn could lead to product shortages that may delay or prevent us

from fulfilling our obligations to our customers. The adoption of stricter health and safety laws and regulations,

stricter interpretations of existing laws, increased governmental enforcement of laws or other developments in

the future may require that we make additional capital expenditures, incur additional expenses or take other

actions in order to remain compliant and maintain our current operations. Complying with, and changes in, these

laws and regulations or terms of approval may increase our compliance costs and adversely affect our business,

prospects, results of operations and financial condition. We are also subject to the laws and regulations

governing relationships with employees in such areas as minimum wage and maximum working hours,

overtime, working conditions, hiring and termination of employees, contract labour and work permits. Our

business is also subject to, among other things, the receipt of all required licenses, permits and authorizations

including manufacturing permits and environmental, health and safety permits. There is a risk that we may

inadvertently fail to comply with such regulations, which could lead to enforced shutdowns and other sanctions

imposed by the relevant authorities, as well as the withholding or delay in receipt of regulatory approvals for our

new products.

17. Our business requires us to obtain and renew certain registrations, licenses and permits from

government and regulatory authorities and the failure to obtain and renew them in a timely manner may

adversely affect our business operations.

Our business operations require us to obtain and renew from time to time, certain approvals, licenses,

registrations and permits, some of which may have expired and we may have either made or are in the process

of making an application to obtain such approval or its renewal. We cannot assure that we will be able to obtain

23

the approvals for which applications have been made including renewals in a timely manner or at all.While we

have obtained a significant number of approvals, licenses, registrations and permits from the relevant

authorities, we are yet to apply for the renewal of "No Objection Certificate"issued by the Chief Fire Officer,

Directorate of Fire Services, Shimla, Himachal Pradesh which was expired onJuly 14, 2018. In addition to this,

we are in the process of applying for the certificate of registration under the Legal Metrology Act, 2009, consent

under section 25 of the Water (Prevention & Control of Pollution) Act, 1974, consent under section 21 of the

Air (Prevention & Control of Pollution) Act, 1981, authorization under rule 3(c) & 5(5) of the Hazardous Waste

(Management, Handling and Trans boundary Movement) Rules’ 2008 and the registration of the registered

office under Punjab Shops And Commercial Establishments Act, 1958. Moreover, letter of issuance of TAN to

the Company for the unit at Baddi, Himachal Pradesh and the original copy of the certificate of "Importer-

Exporter" issued by the Directorate of Foreign Trade, Ministry of Commerceare currently not traceable.Further,

the certificate of registration as an industrial unit vide Permanent Registration No. 02/09/04616/PMT dated

November 21, 2005 in the Department of Industries, Single Window Clearance Agency Baddi has been issued

subject to the condition that the unit will ensure 70% employment to bonafide Himachalies or as fixed by the

government from time to time and its failure at any time would result in to recovery of all fiscal incentive

availed by the unit against this certificate. If we fail to maintain such registrations and licenses or comply with

applicable conditions, or a regulator claims that we have not complied, with such conditions, our certificate of

registration for carrying on a particular activity may be suspended and/or cancelled and we will not then be able

to carry on such activity, which would adversely impact our business and results of operations. For further

details please refer to the chapter titled"Government and Other Statutory Approvals" beginning on page 222 of

this Draft Prospectus.

Also, we were a private limited company inthe name of "Preet Remedies Private Limited" until recently. After

complying with the relevant procedure of Companies Act, 2013, the said private limitedcompany was converted

into a public limited company in the 2018. After conversion there waschange of name of the company from

"Preet Remedies Private Limited" to "Preet Remedies Limited" pursuant to Section 18 of the Companies Act,

2013. We shall be takingnecessary steps for transferring the approvals in the new name of our company. In case

we fail totransfer/obtain the same in name of the company same may adversely affect our business or wemay

not be able to carry our business.

18. If any of our products cause, or are perceived to cause, severe side effects, our reputation, revenues and

profitability could be adversely affected.

Our products may be perceived to cause severe side effects when a conclusive determination as to the cause of

the severe side effects is not obtained or is unobtainable. In addition, our products may be perceived to cause

severe side effects if other pharmaceutical companies products containing the same or similar raw materials or

delivery technologies as our products cause or are perceived to have caused severe side effects, or if one or more

regulators, determines that products containing the same or similar pharmaceutical ingredients as our products

could cause or lead to severe side effects.

If our products cause, or are perceived to cause, severe side effects, we may face a number of consequences,

including:

a severe decrease in the demand for, and sales of, the relevant products;

the recall or withdrawal of the relevant products;

withdrawal or cancellation of regulatory approvals for the relevant products or the relevant

manufacturing facility;

damage to the brand name of our products and our reputation; and

exposure to lawsuits and regulatory investigation relating to the relevant products that result in

liabilities, fines or sanctions.

As a result of these consequences, our reputation, revenues and profitability may be adversely affected.

19. We have applied for registration of our name and logo but do not own the trademark legally as on date.

We may be unable to adequately protect our intellectual property. Furthermore, we may be subject to

claims alleging breach of third party intellectual property rights.

We have applied for registration of our name and logo under the provisions of the Trademarks Act, 1999 and do

not own the trademark as on date. We have filed an application dated September 8, 2018 with the Trade Marks

24

Registry, for registration of logo and corporate name along with certain other marks under Class 35 of the Trade

Marks Act, 1999. The applications are currently pending before the Registrar of Trademarks at various stages.

For further details, please refer chapter titled "Government and Other Approvals" beginning on page 222 of this

Draft Prospectus. As such, we do not enjoy the statutory protections accorded to a registered trademark as on

date. There can be no assurance that we will be able to register the trademark and the logo in future or that, third

parties will not infringe our intellectual property, causing damage to our business prospects, reputation and

goodwill. Further, we cannot assure you that any application for registration of our trademark in future by our

Company will be granted by the relevant authorities in a timely manner or at all. Our efforts to protect our

intellectual property may not be adequate and may lead to erosion of our business value and our operations

could be adversely affected. We may need to litigate in order to determine the validity of such claims and the

scope of the proprietary rights of others. Any such litigation could be time consuming and costly and the

outcome cannot be guaranteed. We may not be able to detect any unauthorized use or take appropriate and

timely steps to enforce or protect our intellectual property. For further details, please refer to the chapter titled

"Government and Other Statutory Approvals" beginning on page 222 of this Draft Prospectus.

20. If we inadvertently infringe on the intellectual property rights of others, our business and results of

operations may be adversely affected.

We operate in an industry characterized by extensive patent and trademark litigation. While we primarily

manufacture and commercialize products that are generic in nature, i.e., pharmaceuticals that are not protected

by patents or trademarks in India, we may inadvertently infringe on trademarks of others during the process of

manufacturing our products. Trademark related litigation can result in significant damages being awarded by us

and injunctions that could prevent the manufacture and sale of certain products or require us to pay significant

royalties in order to continue to manufacture or sell such products. While it is not possible to predict the

outcome of trademark litigation, we believe any adverse result of such litigation could include an injunction

preventing us from selling our products or payment of significant damages or royalty, which would affect our

ability to sell current or future products and divert our management’s attention. The occurrence of any of these

risks could adversely affect our business, financial condition and results of operations. For eg. one of the key

products and trademark “ZENOVIT” is not registered in the name of our Group Company Zenlabs Ethica

Limited and is extensively used by Zenlabs Ethica Limited since the year 2008 for many of its products. The

said use of the mark by Zenlabs Ethica Limited has been contested by a third party who are the owner of the

said trademark “ZENOVIT”. Further, we may be made a party to litigation against our customers for whom we

manufacture products on account of any infringement allegedly committed by them For details, please refer to

the chapter titled "Outstanding Litigation and Material Developments" beginning on page 222 of this Draft

Prospectus.

21. We are subject to the risk of loss due to fire because the materials we use in our manufacturing processes

are highly flammable. We are also subject to the risk of some other natural calamities or general

disruptions affecting our production facilities and distribution chain.

We use highly flammable materials such as solvent -Isopropyl alcohol (IPA) and Methylene dichloride (MDC)

in our manufacturing processes and are therefore subject to the risk of loss arising from fire. Although we have

implemented industry acceptable risk management controls at our manufacturing location and continuously seek

to upgrade them, the risk of fire associated with these materials cannot be completely eliminated. In addition to

fire, natural calamities such as floods, earthquakes, rains, inundations and heavy downpours could disrupt our

manufacturing and storage facilities. We maintain insurance policies to guard against losses caused by fire. Our

insurance coverage for damages to our properties and disruption of our business due to these events may not be

sufficient to cover all of our potential losses. If any of our manufacturing facility were to be damaged as a result

of fire or other natural calamities, it would temporarily reduce our manufacturing capacity and adversely affect

our business operations, financial condition and results of operations.

22. Any disruption in production at, or shutdown of, our manufacturing facilities could adversely affect our

business, results of operations and financial condition.

Our Company’s current manufacturing facility is located at Baddi, Himachal Pradesh and all of our Company’s

products are manufactured from such facility. In the event that there are any disruptions at our Baddi facility due

to natural or man-made disasters, workforce disruptions, regulatory approval delays, fire, failure of machinery,

or any significant social, political or economic disturbances, our ability to manufacture our products may be

adversely affected. Disruptions in our manufacturing activities could delay production or require us to shut

down our manufacturing facility. We may be subject to manufacturing disruptions due to contraventions by us

25

of any of the conditions of our regulatory approvals, which may require our Baddi facility to cease, or limit,

production until the disputes concerning such approvals are resolved. As regulatory approvals for manufacturing

drugs are site specific, we may be unable to transfer manufacturing activities to another location immediately.

Further, while we have not experienced any strikes or labour unrest at the Baddi facility, or otherwise, in the

past, we cannot assure you that we will not experience work disruptions in the future due to disputes or other

problems with our work force. Any labour unrest may hinder our normal operating activities and lead to

disruptions in our operations, which could adversely affect our business, results of operations, financial

condition and cash flows.

23. We rely extensively on our systems, including quality assurance systems, products processing systems

and information technology systems, the failure of which could adversely affect our business, financial

condition and results of operations.

We depend extensively on the capacity and reliability of the quality assurance systems, productprocessing

systems and information technology systems, supporting our operations. Consideringthe nature of our business

and the industry in which we operate, it is imperative for us to have arobust information technology platform. If

our data capturing, processing and sharing cannot beintegrated and/ or we experience any defect or disruption in

the use of, or damage to, ourinformation technology systems, it may adversely affect our operations and thereby

our businessand financial condition. Our systems are also subject to damage or incapacitation by

naturaldisasters, human error, power loss, sabotage, computer viruses, hacking, acts of terrorism andsimilar

events or the loss of support services from third parties. Any disruption in the use of, ordamage to, our systems

may adversely affect our business, financial condition and results ofoperations.

24. Our insurance coverage may not be sufficient or may not adequately protect us against any or all

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

We have taken Standard Fire & Special Perils Policy and burglary insurance for a substantial majority of our

assets at our office, factory and warehouse. These policies also insure us against the risk of earthquakes (fire and

shock). Our policies are subject to customary exclusions and customary deductibles. While we believe that the

insurance coverage which we maintain is in accordance with industry standards and would be reasonably

adequate to cover the normal risks associated with the operation of our business, we cannot assure you that any

claim under the insurance policies maintained by us will be honored fully or in part and on time, or that we have

taken out sufficient insurance to cover all our losses. In addition, our insurance coverage expires from time to

time. We apply for the renewal of our insurance coverage in the normal course of our business, but we cannot

assure you that such renewals will be granted in a timely manner, at acceptable cost or at all.

To the extent that we suffer loss or damage, or successful assertion of one or more large claims against us for

events for which we are not insured, or for which we did not obtain or maintain insurance, or which is not

covered by insurance, exceeds our insurance coverage or where our insurance claims are rejected, the loss

would have to be borne by us and our results of operations, financial performance and cash flows could be

adversely affected. For further details on our insurance arrangements, please refer to the chapter titled "Our

Business – Insurance" beginning on page 93 of this Draft Prospectus.

25. Strong competition in the sector in which we operate could decrease the market share and compel the

company to either reduce the cost charged or increase the sales prices being charged to the end

consumer. In either of the cases, we may have an adverse impact on the revenues and profitability.

The industry in which we are operating is highly and increasingly competitive and unorganized.The competitive

pricing and other factors may adversely affect our results of operations andfinancial condition. Competition may

result in pricing pressures, reduced profit margins or lossmarket share or a failure to grow our market share, any

of which could substantially harm ourbusiness and results of operations. There can be no assurance that we can

effectively compete withour competitors in the future, and any such failure to compete effectively may have a

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

26. We could become liable to our customers, suffer adverse publicity and incur substantial costs as a result

of defects in our products, which in turn could adversely affect the value of our brand, and our sales

could be diminished if we are associated with negative publicity.

Any failure or defect in our products could result in a claim against us for damages, regardless of our

responsibility for such a failure or defect. We currently carry no products liability insurance with respect to our

26

products. Although we attempt to maintain quality standards, we cannot assure that all our products would be of

uniform quality, which in turn could adversely affect the value of our brand, and our sales could be diminished

if we are associated with negative publicity.

Also, our business is dependent on the trust our customers have in the quality of our products. Anynegative

publicity regarding our company, brand, or products, including those arising from a dropin quality of

merchandise from our vendors, mishaps resulting from the use of our products, or anyother unforeseen events

could affect our reputation and our results from operations.

27. We are susceptible to volatility of prices of products marketed by us, including due to competitive

products.

Prices of the products marketed by us are subject to fluctuation, depending on, among other factors, the number

of producers and their production volumes and changes in demand in the markets we serve. Volatility in price

realization and loss of customers may adversely affect our profitability. Further, there is no assurance that we

will be able to maintain our low cost of operations or to further reduce costs or develop new cost effective

processes in the future, owing to factors beyond our control.

28. Non-compliance with the bar coding requirements stipulated by the Director General of Foreign Trade,

(“DGFT”), from time to time, for primary, secondary and tertiary level packaging of finished

pharmaceutical products for export, could adversely affect our goodwill, business, financial condition

and results of operations.

Pursuant to applicable notices, notifications and circulars issued by the DGFT, from time to time,we are

required to comply with bar coding requirements for primary, secondary and tertiary levelpackaging of finished

pharmaceutical products for export, provided, the importing country has notmandated a specific bar coding

requirement. As the bar coding requirements mandated by theDGFT, are applicable in addition to the standard

labelling requirements under the DCA and the Drug Rules, it may lead to an increase in packaging and other

costs, thereby requiring us toallocate more resources and impeding our ability to operate and grow our business.

Any noncompliancewith the bar coding requirements as stipulated by the DGFT, could result incounterfeiting or

piracy of our pharmaceutical products, thereby affecting our goodwill. We cannotassure you that we will be able

to comply with all the bar coding requirements as stipulated by theDGFT, from time to time, within the

prescribed time, or at all, failing which our goodwill,business, financial condition and results of operations could

be adversely affected.

29. Our top 10 customers contribute around 87% of our revenues from operations. Any loss of business from

one or more of them may adversely affect our revenues and profitability.

Our top 10 customers contribute around 87 % of our total sales for the year ending March 31, 2018.Any decline

in our quality standards, growing competition and any change in the demand, may adversely affect our ability to

retain them. We cannot assure that we shall generate the same quantum of business, or any business at all, and

the loss of business from one or more of them mayadversely affect our revenues and results of operations.

However, the composition and revenuegenerated from these customers might change as we continue to add new

customers in the normalcourse of business. We believe that we will not face substantial challenges in

maintaining ourbusiness relationship with them or finding new customers.

30. Our Company’s entire manufacturing facility is located at a single geographical location, and all of our

Company’s manufactured products are produced from such facility. Any delay in production at, or

shutdown of, these facilities may in turn adversely affect our business, financial conditions and results of

operations.

Our Company‘s manufacturing facility is at single location and all of our Company‘s products aremanufactured

from such facility at Baddi, Himachal Pradesh. Further, our business operations would bevulnerable to damage

or interruptions in operations due to adverse weather conditions,earthquakes, fires, explosions, power loss, civil

disturbances or other similar events which mayaffect this area. If our Company experiences delays in production

or shutdown at such facilitiesdue to any reason, including disruptions caused by disputes with its workforce or

due to itsemployees forming a trade union or any natural disaster, our Company’s ability to execute ordersin a

timely manner and its operations will be significantly affected, which in turn would have amaterial effect on its

business, financial conditions and results of operations.

27

31. Changes in technology may render our current technologies obsolete or require us to make substantial

capital investments.

Our industry is continually changing due to technological advances and scientific discoveries. These changes

result in the frequent introduction of new products and significant price competition. If our pharmaceutical

technologies become obsolete our business and results of operations could be adversely affected. Although we

strive to maintain and upgrade our technologies, facilities and machinery consistent with current national and

international standards, the technologies, facilities and machinery we currently use may become obsolete. The

cost of implementing new technologies and upgrading our manufacturing facilities could be significant, which

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

32. We are dependent on our senior management team and the loss of key members or failure to attract

skilled personnel may adversely affect our business.

Our business and operations are led by our experienced management teamas well as other skilled personnel. Our

senior management is important to our business because of their experience and knowledge of the industry.

Competition among pharmaceutical companies for qualified employees is intense, and the ability to retain and

attract qualified individuals is critical to our success. We cannot assure you that we will be able to retain any or

all of the key members of our management team as well as other skilled personnel.

If we lose the services of any of the management team or key personnel, we may be unable to locate suitable or

qualified replacements, and may incur additional expenses to recruit and train new personnel, which could

adversely affect our business operations and affect our ability to continue to manage and expand our business.

Furthermore, as we expect to continue to expand our operations and develop new products, we will need to

continue to attract and retain experienced management and key research and development personnel.

33. Our Company requires significant amount of working capital for a continued growth. Our inability to

meet our working capital requirements may have an adverse effect on our results of operations.

Our business is working capital intensive primarily on account of inventory levels. A significant portion of our

working capital is utilized towards trade receivables and inventories. Summary of our working capital position

is given below:

Sr.

No. Particulars

As on March 31,

2017 2018 2019

Actual

(Restated)

Actual

(Restated)

Estimated

A. Current Assets

Trade Receivables 2441.14 1787.90 2259.00

Inventories 541.19 727.55 888.00

Short Term Loans and Advances 9.25 213.32 198.00

Cash and cash equivalents 278.10 295.47 214.00

Total (A) 3269.68 3024.24 3559.00

B. Current Liabilities

Trade Payables 1716.80 1848.58 1830.00

Other Current Liabilities and Short Term Provisions 440.95 281.13 290.00

Total (B) 2157.75 2129.71 2120.00

C. Net Working Capital (A)-(B) 1111.93 894.53 1439.00

Our Company intends to continue growing by reaching out to newer customers and also increasing the sales in

the existing customers. All these factors may result in increase in the quantum of current assets. Our inability to

maintain sufficient cash flow, credit facility and other sources of fund, in a timely manner, or at all, to meet the

requirement of working capital or pay out debts, could adversely affect our financial condition and result of our

operations. For further details regarding working capital requirement, please refer to the chapter titled "Objects

of the Issue" beginning on page 73 of this Draft Prospectus.

34. Our Company’s expected production levels could be adversely affected by various factors.

28

Manufacturers of products often encounter difficulties in production. These problems includedifficulties with

production costs and yields, product quality (caused by, among other things,process failure, equipment failure,

human errors or other unforeseen events during the productioncycle) and shortages of qualified personnel, as

well as compliance with regulatory requirements. Inaddition, any material labour problems, such as a work

stoppage or mechanical failure ormalfunction could likewise lead to delays in production. Any of these

problems could result in delay or suspension of production and may entail higher costs or other instalment

expenses.Furthermore, if our Company‘s suppliers fail to deliver necessary manufacturing equipment,

rawmaterials or adequately perform the services outsourced by our Company to them, productiondeadlines may

not be met. Any such developments could have a material adverse effect on ourCompany‘s business and

financial operations.

35. Increasing employee compensation in India may erode some of our Company’s competitive advantages

and may reduce profit margins.

Employee compensation in India has historically been significantly lower than employee compensation in the

US and Europe for comparable skilled professionals, which is one of our Company’s competitive strengths.

However, increase in compensation levels in India may erode some of this competitive advantage and may

negatively affect our profit margins. Employee compensation in India is currently increasing which could result

in increased costs relating to scientists and engineers, managers and other professionals. Our Company may

need to continue to increase levels of employee compensation to remain competitive and manage attrition. Any

increases in the amount of compensation paid to our Company‘s employees could have a significant effect on

production costs, which may affect our position as a low-cost producer of Bulk drugs and have a material

adverse effect on our business and financial operations.

36. Our industry is labour intensive and our business operations may be materially adversely affected by

strikes, work stoppages or increased wage demands by our employees or those of our suppliers.

Our industry being labour intensive is highly dependent on labour force for carrying out its manufacturing

operations. Shortage of skilled/unskilled personnel or work stoppages caused by disagreements with employees

could have an adverse effect on our business and results ofoperations. We have not experienced any major

disruptions in our business operations due todisputes or other problems with our work force in the past; however

there can be no assurance thatwe will not experience such disruptions in the future. Such disruptions may

adversely affect ourbusiness and results of operations and may also divert the management's attention and result

inincreased costs.

India has stringent labour legislation that protects the interests of workers, including legislation that sets forth

detailed procedures for the establishment of unions, dispute resolution and employee removal and legislation

that imposes certain financial obligations on employers upon retrenchment. We are also subject to laws and

regulations governing relationships with employees, in such areas as minimum wage and maximum working

hours, overtime, working conditions, hiring and terminating of employees and work permits. Although our

employees are not currently unionized, there can be no assurance that they will not unionize in the future. If our

employees unionize, it may become difficult for us to maintain flexible labour policies, and we may face the

threat of labour unrest, work stoppages and diversion of our management's attention due to union intervention,

which may have a material adverse impact on our business, results of operations and financial condition.

37. We have historically derived a substantial portion of our revenue from the Domestic Market and the

unregulated Markets.

We derived a significant percentage of our revenue from the Domestic Market and the unregulatedMarkets. We

are well positioned in the Domestic Market and we intend to increase our presence in the Regulated Markets.

We will continue to evaluate initiatives and strategies toincrease our presence in the Domestic Market and the

Regulated Markets. We cannot assure you that we will be able to continue to generate a significant portion of

our revenue from these markets.Any failure to do so may adversely affect our business, financial condition and

results ofoperations.

38. If we are unable to source business opportunities effectively, we may not achieve our financial objectives.

Our ability to achieve our financial objectives will depend on our ability to identify, evaluate andaccomplish

business opportunities. To grow our business, we will need to hire, train, supervise andmanage new employees

and to implement systems capable of effectively accommodating ourgrowth. However, we cannot assure that

29

any such employees will contribute to the success of ourbusiness or that we will implement such systems

effectively. Our failure to source businessopportunities effectively could have a material adverse effect on our

business, financial conditionand results of operations. It also is possible that the strategies used by us in the

future may bedifferent from those presently in use. No assurance can be given that our analyses of market

andother data or the strategies we use or plans in future to use will be successful under various

marketconditions.

39. Introduction of alternative pharmaceutical products caused by changes in technology or consumer

preferences may affect demand for our existing products which may adversely affect our financial results

and business prospects.

Our products are mainly used in the healthcare sector to cater to masses. Our business is affected by change

intechnology, consumer preferences, market perception of brand, attractiveness, convenience, safety and

environmental norms. Our ability to anticipate such changes and to continuously develop and introduce new and

enhanced products successfully on a timely basis will be a key factor in our growth and business prospects.

There can be no assurance that we will be able to keep pace with the technological advances that may be

necessary for us to remain competitive. Further, any substantial change in preference of consumers who are end

users of our products will affect our customers’ businesses and, in turn, will affect the demand for our products.

Any failure to forecast and/or meet the changing demands of pharmaceutical businesses andconsumer

preferences may have an adverse effect on our business, profitability and growthprospects.

40. We have not entered into any technical support service agreements for the maintenance and smooth

functioning of our equipments and machineries, which may affect our performance.

Our manufacturing processes involve daily use of technical equipment and machineries. They require periodic

maintenance checks and technical support in an event of technical breakdown or malfunctioning. Our Company

has entered into few technical support service agreements withcompetent third party. Although the Company

has easy and quick accessibility to avail thetechnical support from the external experts and the machinery

suppliers locally, any failure toquickly redress any technical issue, may increase our downtime which may affect

our productivity,business and results of operations.

41. Our lenders have imposed certain restrictive conditions on us under our financing arrangements, which

may limit our ability to expand our business and our flexibility in planning for, or reacting to, changes in

our business and industry. We will also require a significant amount of cash to meet our obligations

under such financing arrangements, which we may not be able to generate.

Most of our financing arrangements are secured by substantially of our movable and immovable assets. Our

financing agreements generally include various conditions and covenants that require us to obtain lender

consents prior to carrying out certain activities and entering into certain transactions and also covenants such as

prior permission before raising any further loans/ availing any facilities against the assets offered as security;

Our Company has obtained a ‘no-objection certificate’ from HDFC Bank limited for the IPO. For further details,

please refer to the chapter titled "Statement of Financial Indebtedness" beginning on page 202 of this Draft

Prospectus.

There can be no assurance that we will continue to comply with the covenants with respect to our financing

arrangements in the future or that we will be able to secure waivers for any such non-compliance in a timely

manner or at all. Any future inability to comply with the covenants under our financing arrangements or to

obtain necessary consents required thereunder may lead to the termination of our credit facilities, levy of penal

interest, acceleration of all amounts due under such facilities and the enforcement of any security provided. If

the obligations under any of our financing agreements are accelerated, we may have to dedicate a substantial

portion of our cash flow from operations to make payments under such financing documents, thereby reducing

the availability of cash for our working capital requirements and other general corporate purposes. Further,

during any period in which we are in default, we may be unable to raise, or face difficulties raising, further

financing. In addition, other third parties may have concerns over our financial position and it may be difficult

to market our financial products. Any of these circumstances or other consequences could adversely affect our

business, credit rating, prospects, results of operations and financial condition. Moreover, any such action

initiated by our lenders could adversely affect the price of the Equity Shares.

Our ability to make payments on our indebtedness will depend on our future performance and our ability to

generate cash, which to a certain extent is subject to general economic, financial, competitive, legislative, legal,

30

regulatory and other factors, many of which are beyond our control. If our future cash flows from operations and

other capital resources are insufficient to pay our debt obligations, meet our contractual obligations, or to fund

our other liquidity needs, we may be forced to sell assets or attempt to restructure or refinance our existing

indebtedness. Any refinancing of our debt could be at higher interest rates and may require us to comply with

more onerous covenants, which could further restrict our business operations. The terms of existing or future

debt instruments may restrict us from adopting some of these alternatives. In addition, any failure to make

payments of interest and principal on our outstanding indebtedness on a timely basis would likely result in a

reduction of our creditworthiness and/or any credit rating we may hold, which could harm our ability to incur

additional indebtedness on acceptable terms.

42. Our lenders have charge over our movable and immovable properties in respect of finance availed by us.

Our Company have taken secured loan from banks by creating a charge over our movable and immovable

properties in respect of loans/facilities availed by us. The total amounts outstanding and payable by us for

secured loans were Rs.850.21 lakhs as on March 31, 2018. In the event we default in repayment of the loans /

facilities availed by us and any interest thereof, our properties may be forfeited by lenders, which in turn could

have significant adverse effect on our business, financial condition and results of operations. For further details

please refer to "Annexure VII – Details of Long Term Borrowings as Restated" and "Annexure X - Details of

Short Term Borrowings as Restated" of chapter titled "Financial Statements as Restated" beginning on page 151

and Financial Indebtedness in chapter titled "Financial Indebtedness"beginning on page 202 of this Draft

Prospectus.

43. Within the parameters as mentioned in the chapter titled "Objects of the Issue" beginning on page 73 of

this Draft Prospectus, our Company’s management will have flexibility in applying proceeds of the Issue.

The fund requirement and deployment mentioned in the Objects of this Issue have not been appraised by

any bank or financial institution.

We intend to use fresh Issue Proceeds towards working capital requirements, repayment/pre-payment of term

loan, general corporate purposes and to meet the issue expenses. We intend to deploy the Net Issue Proceeds in

Financial Year 2018-2019 and such deployment is based on certain assumptions and strategy which our

Company believes to implement in future. The funds raised from the fresh Issue may remain idle on account of

change in assumptions, market conditions, strategy of our Company, etc., For further details on the use of the

Issue Proceeds, please refer to the chapter titled "Objects of the Issue" beginning on page 73 of this Draft

Prospectus.

The deployment of funds for the purposes described above is at the discretion of our Company’sBoard of

Directors. The fund requirement and deployment is based on internal managementestimates and has not been

appraised by any bank or financial institution. Accordingly, within theparameters as mentioned in the chapter

titled "Objects of the Issue" beginning on page 73 of thisDraft Prospectus, the management will have flexibility

in applying the proceedsreceived by our Company from the Issue. However, the company shall comply with

Section 27 ofthe Companies Act, 2013 before varying the Objects of the Issue. The Audit Committee

willmonitor the utilization of the proceeds of this Issue.

44. The Objects of this Issue are based on the internal estimates of our management, and have not been

appraised by any bank or financial institution. The deployment of funds in the project is entirely at our

discretion and as per the details mentioned in chapter titled "Objects of the Issue".

Our funding requirements, the funding plans and the deployment of the proceeds of the Issue are based on our

management estimates and have not been appraised by any bank or financial institution. The deployment of

funds in the expansion project is entirely at our own discretion and the same will not be monitored by any

external agency. We may have to revise our management estimates from time to time and consequently our

funding requirements may also change. The estimates contained in the Draft Prospectus may exceed the value

that would have been determined by third party appraisals, which may require us to reschedule the deployment

of funds proposed by us and may have a bearing on our expected revenues and earnings.

45. We are dependent upon the growth prospects of the Healthcare Sector, where our products are largely

used to cater masses.

Our Company broadly falls under the pharmaceutical industry of which we undertake manufacturing and

marketing of pharmaceutical products. Our products are used generally in the healthcare sector and thus cater to

31

the requirements of the healthcare sector at large, thus any slowdown in the growth rate or downward trend in

any healthcare facilities in the country directly or indirectly impact our own growth prospects and may result in

decline in profits and turnover of sales.

46. Our Company is dependent on third party transportation for the delivery of raw materials/finished

product and any disruption in their operations or a decrease in the quality of their services could affect

our Company's reputation and results of operations.

Our Company uses third party transportation for delivery of our raw materials and finished products. Though

our business has not experienced any disruptions due to transportation strikes in the past, any future

transportation strikes may have an adverse effect on our business. These transportation facilities may not be

adequate to support our existing and future operations. In addition raw materials/ finished products may be lost

or damaged in transit for various reasons including occurrence of accidents or natural disasters. There may also

be delay in delivery of products which may also affect our business and results of operation negatively. An

increase in the freight costs or unavailability of freight for transportation of our raw materials may have an

adverse effect on our business and results of operations.

Further, disruptions of transportation services due to weather-related problems, strikes, lockouts, inadequacies in

the road infrastructure and port facilities, or other events could impair ability to procure raw materials on time.

Any such disruptions could materially and adversely affect our business, financial condition and results of

operations.

47. Our Promoters and Directors may have interests in us other than reimbursement of expenses incurred or

normal remuneration or benefits.

Our Promoters are interested in our Company to the extent of any transactions entered into or their shareholding

and dividend entitlement in our Company or remuneration received from our Company. Our Directors are also

interested in our Company to the extent of their shareholding and dividend entitlement, remuneration paid to

them for services rendered as Directors of our Company and reimbursement of expenses payable to them. Our

Directors may also be interested to the extent of any transaction entered into by our Company with any other

company or firm in which they are directors or partners. For further information, please refer to the chapter

titled "Our Management","Our Promoters and Promoter Group" and "Related Party Transactions" beginning

on pages 123, 136 and 149, respectively of this Draft Prospectus.

48. We could be harmed by employee misconduct or errors that are difficult to detect and any such

incidences could adversely affect our financial condition, results of operations and reputation.

Employee misconduct or errors could expose us to business risks or losses, including regulatorysanctions and

cause serious harm to our reputation. There can be no assurance that we will be ableto detect or deter such

misconduct. Moreover, the precautions we take to prevent and detect suchactivity may not be effective in all

cases. Our employees may also commit errors that could subjectus to claims and proceedings for alleged

negligence, as well as regulatory actions on account ofwhich our business, financial condition, results of

operations and goodwill could be adverselyaffected.

49. We have had negative net cash flow from investing and financing activities as per restated financial

statements. Any negative cash flow in the future would adversely affect our business, results of


We had negative net cash flow from investing and financing activities in the financial years 2016, 2017 and

2018. Our cash flows from investing and financing activities are further detailed in the table below:

Particulars Fiscal Year

2018 2017 2016

Investing activities (725.18) (616.52) (9.46)

Financing activities (8.82) -- (65.85)

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

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

external resources. There can be no assurance that our net cash flow from operating, investing activities will be

32

positive in the future. Any negative cash flows from operating and investment activities in future would

adversely affect our business, results of operations and financial condition. For more information regarding cash

flows, please refer to the chapter titled "Restated Cash Flow Statements – Annexure X" beginning on page 151

of this Draft Prospectus.

50. Our Associate Company has incurred lossed in previous fiscal years.

Our Associate Company i.e. ZenlabsEthica Limiited and Oasis Pharma and Phytomolecules Private Limited

incurred losses in the previous fiscal years 2014-15. Set forth below are the details of losses after tax incurred by

our Associate Company in the recent past:

Particulars Fiscal Year (2014-15) Zenlabs Ethica Limited

(Losses after Tax)

6.64

Oasis Pharma and Phytomolecules Private Limited

(Losses after Tax)

123.75

For details of the financials of our Associate Company, please refer to the chapter titled "History and Certain

Corporate Matters" beginningon page 120 of this Draft Prospectus.

51. If we fail to establish and maintain effective internal control over our financial reporting, we may have

misstatements in our financial statements and we may not be able to report our financial results in a

timely manner and as a result current and potential investors could lose confidence in our financial

reporting.

If we fail to maintain the adequacy of our internal controls, we may be unable to provide financial information

in a timely and reliable manner. Any such difficulties or failure may have an adverse effect on our business,

financial condition and operating results. In the event that we are able to identify any errors or issues with our

internal controls over financial reporting and we are not able to remedy the weakness in a timely manner, we

may not be able to provide financial information in a timely and reliable manner and we may incorrectly report

financial information, either of which could subject us to sanctions or investigation by regulatory authorities. In

addition, there could be a negative reaction in the financial markets due to a loss of confidence in the reliability

of our financial statements.

52. We have in the past entered into related party transactions and may continue to do so in the future.

We have entered into transactions with our Directors, relatives of Directors and enterprises over which our

Directors have a significant influence for sale/purchase of goods/raw material and salary paid the KMPs. While

we believe that all such transactions have been conducted on an arm’s length basis, there can be no assurance

that we could not have achieved more favorable terms had such transactions not been entered into with related

parties. Furthermore, it is likely that we may enter into related party transactions in the future. There can be no

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

condition and results of operations. For further details, please refer to the chapter titled "Related Party

Transactions" beginning on page 149 of this Draft Prospectus.

53. Fluctuations in interest rates could adversely affect our results of operations.

An increase in the interest rates on our existing or future debt will increase the cost of servicing such debt. We

cannot assure you, however, that we will be able to do so on commercially reasonable terms or any of such

agreements we enter into will protect us fully against our interest rate risk. Any increase in interest expense may

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

54. The shortage or non-availability of power facilities may adversely affect our manufacturing processes

and have an adverse impact on our results of operations and financial condition.

Our manufacturing processes require substantial amount of power facilities. We have arrangements for regular

power supply at our factory premise. The total existing power requirement of our Baddi unit is around 946 kw

The requirement of power is met by supply from Himachal Pradesh State Electricity Board Limited. The

quantum and nature of power requirements of our industry and Company is such that it cannot be supplemented/

augmented by alternative/ independent sources of power supply since it involve significant capital expenditure

33

and per unit cost of electricity produced is very high in view of oil prices and other constraints. Our Company is

mainly dependent on State Government for meeting its electricity requirements. Any disruption/non availability

of power shall directly affect our production which in turn shall have an impact on profitability and turnover of

our Company.

55. The Shortage or non-availability of water facilities may adversely affect our manufacturing processes

and have an adverse impact on our results of operations and financial condition.

Our manufacturing facility situated at Plot No 183-186, HPSIDC, Industrial Area, Baddi, District

Solan,Himachal Pradesh, requires substantial amount of water facilities for manufacturing process and our

Company uses borewell water for the same.The quantum and nature of water requirements of our industry is

significant and requires continuous supply. Our Company is mainly dependent on borewell water for meeting its

water requirements. Any disruption/non availability of water shall directly affect our production which in turn

shall have an impact on profitability and turnover of our Company.

56. Our operations may be adversely affected in case of industrial accidents at our production facility.

Usage and handling of machinery or any sharp part of any machinery by labour during production process,

handling of chemicals and materials, short circuit of power supply for machines, etc. may result in accidents and

fires, which could cause injury to our labour, employees, other persons on the site and could also damage our

properties thereby affecting our operations. Further our plants and machinery and personnel may not be covered

under adequate insurance for occurrence of particular types of accidents which could adversely hamper our cash

flows and profitability.

57. A significant disruption to our distribution network or any disruption of civil infrastructure, transport or

logistic services, may create delays in deliveries of products distributed by us.

We rely on transportation throughroadways to receive raw materials required for our products and to deliver our

finished products to our customers. We also depend on third party transportation for delivery of our raw

materials and finished products. Unexpected delays in those deliveries, including due to delays in obtaining

customs clearance for raw materials imported by us, or increases in transportation costs, could significantly

decrease our ability to make sales and earn profits. Manufacturing delays or unexpected demand for our

products may also require us to use faster, but more expensive, transportation methods, which could adversely

affect our gross margins. In addition, labor shortages or labor disagreements in the transportation or logistics

industries or long-term disruptions to the national and international transportation infrastructure that lead to

delays or interruptions of deliveries could materially adversely affect our business.

Further, we cannot assure you that we will be able to secure sufficient transport capacity for these purposes. A

significant disruption to our distribution network or any disruption of civil infrastructure could lead to a failure

by us to provide products distributed by us in a timely manner, which would adversely affect our business and

results of operations.

58. Our operations are subject to high working capital requirements. Our inability to maintain an optimal

level of working capital required for our business may impact our operations adversely.

Our business requires significant amount of working capital and major portion of our working capital is utilized

towards debtors, payment to suppliers and service providers and cash and cash equivalents. Our growing scale

and expansion, if any, may result in increase in the quantum of current assets. Our inability to maintain

sufficient cash flow, credit facility and other sourcing of funding, in a timely manner, or at all, to meet the

requirement of working capital or pay out debts, could adversely affect our financial condition and result of our

operations. For further details regarding working capital requirement, please refer to the chapter titled "Objects

of the Issue" beginning on page 73 of this Draft Prospectus.

59. There is no monitoring agency appointed by our Company to monitor the utilization of the

Issueproceeds.

As per SEBI (ICDR) Regulations appointment of monitoring agency is required only for Issue size above

₹10,000.00 lakhs. Hence, we have not appointed any monitoring agency to monitor the utilization of Issue

proceeds. However, the audit committee of our Board will monitor the utilization of Issue proceeds in termsof

SEBI Listing Regulations. Further, our Company shall inform about material deviations in the utilization of

34

Issue proceeds to the stock exchange and shall also simultaneously make the material deviations / adverse

comments of the audit committee public.

60. We have not made any alternate arrangements for meeting our funds requirements for the Objects of the

Offer. Further we have not identified any alternate source of financing the “Objects of the Offer”. Any

shortfall in raising / meeting the same could adversely affect our growth plans, business operations and


As on date of this Draft Prospectus, we have not made any alternate arrangements for meeting our

fundsrequirements for one of the objects of the Issue i.e. working capital, repayment/pre-payment of term

loans,etc. We meet our fund requirements through our bank finance, debts, owned funds and internal accruals.

Any shortfall in our net owned funds, internal accruals and our inability to raise debt in future would result in us

being unable to meet our capital requirements, which in turn will negatively affect our financial condition and

results of operations. Further, we have not identified any alternate source of funding and hence any failure or

delay on our part to raise money from this offer or any shortfall in the offer proceeds may delay the

implementation schedule and could adversely affect our growth plans. For further details, please refer to the

chapter titled "Objects of the Issue" beginning on page 73 of this Draft Prospectus.

61. Our ability to pay dividends in the future will depend on our earnings, financial condition, working

capital requirements and capital expenditures.

Our ability to pay dividends in the future will depend on our earnings, financial condition, cash flows, working

capital requirements and our capital expenditure. Any future determination as to the declaration and payment of

dividends will be at the discretion of our Board and subsequent approval of shareholders and will depend on

factors that our Board and shareholders deem relevant, including among others, our future earnings, financial

condition, cash requirements, business prospects and any financing arrangements. We may decide to retain all of

our earnings to finance the development and expansion of our business and, therefore, may not declare

dividends on our Equity Shares. We cannot assure you that we will be able to pay dividends at any point in the

future. For details of dividend paid by our Company in the past, please refer to the chapter titled "Dividend

Policy" beginning on 150 of this Draft Prospectus.

62. Conflicts of interest may arise out of common business undertaken by our Company and our Associate

Companies.

Our Associate Companies i.e. Oasis Pharma And Phytomolecules Private Limited and Zenlabs Ethica Limited

are also authorized to carry similar activities as those conducted by our Company. However, we do not have

any non-compete agreement/ arrangement with our Associate Companies which could give rise to conflict of

interest. As a result, conflicts of interests may arise in allocating business opportunities amongst our Company

and our Associate Companies in circumstances where our respective interests diverge. In cases of conflict, our

Promoters may favour other company in which our Promoters have interests. There can be no assurance that our

Promoters or Associate Companies or members of the Promoter Group will not compete with our existing

business or any future business that we may undertake or that their interests will not conflict with ours. Any

such present and future conflicts could have a material adverse effect on our reputation, business, results of


63. We cannot guarantee the accuracy or completeness of facts and other statistics with respect toIndia, the

Indian economy and Pharmaceutical industry contained in the Draft Prospectus.

While facts and other statistics in this Draft Prospectus relating to India, the Indian economy and the

Pharmaceutical industry has been based on various government publications andreports from government

agencies that we believe are reliable, we cannot guarantee the quality or reliability of such materials. While we

have taken reasonable care in the reproduction of suchinformation, industry facts and other statistics have not

been prepared or independently verified byus or any of our respective affiliates or advisors and, therefore we

make no representation as totheir accuracy or completeness. These facts and other statistics include the facts and

statistics included in the chapter titled "Our Industry" beginning on page 83 of this Draft Prospectus. Due to

possibly flawed or ineffective data collection methods or discrepancies betweenpublished information and

market practice and other problems, the statistics herein may beinaccurate or may not be comparable to statistics

produced elsewhere and should not be undulyrelied upon. Further, there is no assurance that they are stated or

compiled on the same basis or with the same degree of accuracy, as the case may be, elsewhere.

35

Risks Relating to the Issue and Investments in our Equity Shares

1. We may not declare dividends in the foreseeable future.

We may retain all future earnings, if any, for use in the operations and expansion of the business. As a result, we

may not declare dividends in the foreseeable future. Any future determination as to the declaration and payment

of dividends will be at the discretion of our Board of Directors and will depend on factors that our Board of

Directors deems relevant, including among others, our results of operations, financial condition, cash

requirements, business prospects and any other financing arrangements. Accordingly, realization of a gain on

shareholders’ investments will depend on the appreciation of the price of the Equity Shares. There is no

guarantee that our Equity Shares will appreciate in value.

2. We may require further equity issuance, which will lead to dilution of equity and may affect the market

price of our Equity Shares or additional funds through incurring debt to satisfy our capital needs, which

we may not be able to procure and any future equity offerings by us.

Our growth is dependent on having a strong balance sheet to support our activities. In addition to the Issue

proceeds and our internally generated cash flow, we may need other sources of financing to meet our capital

needs which may include entering into new debt facilities with lending institutions or raising additional equity in

the capital markets. We may need to raise additional capital from time to time, dependent on business

conditions. The factors that would require us to raise additional capital could be business growth beyond what

the current balance sheet can sustain; additional capital requirements imposed due to changes in regulatory

regime or significant depletion in our existing capital base due to unusual operating losses. Any fresh issue of

shares or convertible securities would dilute existing holders, and such issuance may not be done at terms and

conditions, which are favorable to the then existing shareholders of our Company. If our Company decides to

raise additional funds through the incurrence of debt, our interest obligations will increase, and we may be

subject to additional covenants, which could further limit our ability to access cash flows from our operations.

Such financings could cause our debt to equity ratio to increase or require us to create charges or liens on our

assets in favour of lenders. We cannot assure you that we will be able to secure adequate financing in the future

on acceptable terms, in time, or at all. Our failure to obtain sufficient financing could result in the delay or

abandonment of our expansion plans. Our business and future results of operations may be adversely affected if

we are unable to implement our expansion strategy.

Any future issuance of Equity Shares by our Company may dilute shareholding of investors in our Company;

and hence adversely affect the trading price of our Company’s Equity Shares and its ability to raise capital

through an issue of its securities. In addition, any perception by investors that such issuances or sales might

occur could also affect the trading price of our Company’s Equity Shares. Additionally, the disposal, pledge or

encumbrance of Equity Shares by any of our Company’s major shareholders, or the perception that such

transactions may occur may affect the trading price of the Equity Shares. No assurance may be given that our

Company will not issue Equity Shares or that such shareholders will not dispose of, pledge or encumber their

Equity Shares in the future.

3. Investors can be subject to Indian taxes arising out of capital gains on the sale of the Equity Shares.

Recently, the Finance Act, 2018 levies taxes on such long-term capital gains exceeding Rs.100,000

arising from sale of Equity Shares on or after April 1, 2018, while continuing to exempt the unrealized

capital gains earned up to January 31, 2018 on such Equity Shares.

Under current Indian tax laws, capital gains arising from the sale of Equity Shares in an Indian company are

generally taxable in India. However, any gain realized on the sale of listed equity shares on or before March 31,

2018 on a stock exchange held for more than 12 months will not be subject to long term capital gains tax in

India if Securities Transaction Tax ("STT") is paid on the sale transaction and additionally, as stipulated by the

Finance Act, 2017, STT had been paid at the time of acquisition of such equity shares on or after October 1,

2004, except in the case of such acquisitions of equity shares which are not subject to STT, as notified by the

Central Government under notification no. 43/2017/F. No. 370142/09/2017-TPL on June 5, 2017. However, the

Finance Act, 2018, has now levied taxes on such long-term capital gains exceeding Rs. 100,000 arising from

sale of Equity Shares on or after April 1, 2018, while continuing to exempt the unrealized capital gains earned

up to January 31, 2018 on such Equity Shares. Accordingly, you may be subject to payment of long term capital

gains tax in India, in addition to payment of STT, on the sale of any Equity Shares held for more than 12

months. STT will be levied on and collected by a domestic stock exchange on which the Equity Shares are sold.

Further, any gain realized on the sale of listed equity shares held for a period of 12 months or less will be subject

36

to short term capital gains tax in India. Capital gains arising from the sale of the Equity Shares will be exempt

from taxation in India in cases where the exemption from taxation in India is provided under a treaty between

India and the country of which the seller is resident. Generally, Indian tax treaties do not limit India‘s ability to

impose tax on capital gains. As a result, residents of other countries may be liable for tax in India as well as in

their own jurisdiction on a gain upon the sale of the Equity Shares.

4. A third party could be prevented from acquiring control of our Company because of anti-takeover

provisions under Indian law.

There are provisions in Indian law that may delay, deter or prevent a future takeover or change in control of our

Company, even if a change in control would result in the purchase of your Equity Shares at a premium to the

market price or would otherwise be beneficial to you. Such provisions may discourage or prevent certain types

of transactions involving actual or threatened change in control of us. Under the takeover regulations in India, an

acquirer has been defined as any person who, directly or indirectly, acquires or agrees to acquire shares or

voting rights or control over a company, whether individually or acting in concert with others. Although, these

provisions have been formulated to ensure that interests of investors/shareholders are protected, these provisions

may also discourage a third party from attempting to take control of our Company. Consequently, even if a

potential takeover of our Company would result in the purchase of the Equity Shares at a premium to their

market price or would otherwise be beneficial to its stakeholders, it is possible that such a takeover would not be

attempted or consummated because of the Indian takeover regulations.

5. Fluctuations in currency exchange rates may have an adverse impact on the investment in our Equity

Shares.

The exchange rate between the Indian Rupee and the U.S. Dollar has changed substantially in recent years and

may fluctuate substantially in the future. Fluctuations in the exchange rate between the U.S. Dollar and the

Indian Rupee may affect the value of the investment in our Equity Shares of a person resident outside India.

Specifically for persons resident outside India, if there is a change in relative value of the Indian Rupee to the

U.S. Dollar, each of the following values will also be affected: the U.S. Dollar equivalent of the Indian Rupee

trading price of our Equity Shares in India; the U.S. Dollar equivalent of the proceeds that you would receive

upon the sale in India of any of our Equity Shares; and the U.S. Dollar equivalent of cash dividends, if any, on

our Equity Shares, which will be paid only in Indian Rupee. You may be unable to convert Indian Rupee

proceeds into U.S. Dollars or any other currency or the rate at which any such conversion could occur could

fluctuate.

Risks Relating to India /External Risk Factors

6. Regional hostilities, terrorist attacks, communal disturbances, civil unrest and other acts of violence or

war involving India and other countries may result in a loss of investor confidence and adversely affect

the financial markets and our business.

Terrorist attacks, civil unrest and other acts of violence or war may negatively affect the Indian markets on

which our Equity Shares will trade and also adversely affect the worldwide financial markets. In addition, the

Asian region has from time to time experienced instances of civil unrest and hostilities among neighboring

countries. Hostilities and tensions may occur in the future and on a wider scale. Military activity or terrorist

attacks in India may result in investor concern about stability in the region, which may adversely affect the price

of our Equity Shares. Events of this nature in the future, as well as social and civil unrest within other countries

in the world, could influence the Indian economy and could have an adverse effect on the market for securities

of Indian companies, including our Equity Shares.

7. Changing laws, rules and regulations and legal uncertainties in India, including adverse application of

corporate and tax laws, may adversely affect our business and financial results.

Our business and financial performance could be adversely affected by any change in laws or interpretations of

existing laws, or the promulgation of new laws, rules and regulations applicable to us and our business including

those relating to the industry in which we operate. There can be no assurance that the Government of India or

state governments will not introduce new laws, regulations and policies which will require us to obtain

additional approvals and licenses or impose onerous requirements on our business. The regulatory and policy

environment in which we operate is evolving and subject to change. Our business is subject to a significant

number of state tax regimes and changes in legislations governing them, implementing them or the regulator

37

enforcing them in any one of those jurisdictions could adversely affect our results of operations. The applicable

categories of taxes and tax rates also vary significantly from state to state, which may be amended from time to

time. The final determination of our tax liabilities involves the interpretation of local tax laws and related

regulations in each jurisdiction as well as the significant use of estimates and assumptions regarding the scope of

future operations and results achieved and the timing and nature of income earned and expenditures incurred.

Changes in the operating environment, including changes in tax law, could impact the determination of our tax

liabilities for any given tax year. Taxes and other levies imposed by the Government or State Governments that

affect our industry include GST, income tax and other taxes, duties or surcharges introduced from time to time

and any adverse changes in any of the taxes levied by the Government or State Governments could adversely

affect our competitive position and profitability. Such changes, including the instances mentioned below, may

adversely affect our business, results of operations, financial condition and prospects, to the extent that we are

unable to suitably respond to and comply with any such changes in applicable law and policy.

The Goods and Services Tax ("GST") has been introduced and implemented on July 1, 2017 in the whole of

India. GST is a unified and comprehensive indirect tax which would subsume the multiple indirect taxes

currently levied by the central and state governments. India has adopted a dual model of GST. Therefore, under

the GST regime, a tax called the Central Goods and Services Tax ("CGST") along with State Goods and

Services Tax ("SGST") or Union Territory Goods and Services Tax ("UTGST") has been simultaneously levied

on all intra-state supplies of goods and/or services at the rates specified in this regard. Further, Integrated Goods

and Services Tax ("IGST") is levied on all supplies of goods and/or services made in the course of inter-State

trade or commerce. Article 370 of the Constitution grants special autonomous status to the State of Jammu and

Kashmir. However, the Parliament of India retains the power to make laws on defence, external affairs and

communication-related matters of the state. This is one of the reasons why the Service Tax was levied to the

whole of India since 1994 but not applicable to J&K. Nevertheless, the State of Jammu and Kashmir then passed

the GST bill in their state assembly on July 5, 2017 stating that the two (2) laws viz. Central Goods and Services

Tax (CGST) and Integrated Goods and Services Tax (IGST) are applicable to them. GST regime is an attempt to

combine taxes and levies by the Central and State Governments into a unified rate structure.

Further, the General Anti Avoidance Rules ("GAAR") have been made effective from April 1, 2017. The tax

consequences of the GAAR provisions being applied to an arrangement could result in denial of tax benefit

amongst other consequences which may have an adverse tax impact on us.

We have not determined the effect of such legislations on our business. In addition, unfavourable changes in or

interpretations of existing, or the promulgation of new, laws, rules and regulations including foreign investment

laws governing our business, operations and group structure could result in us being deemed to be in

contravention of such laws or may require us to apply for additional approvals. We may incur increased costs

and other burdens relating to compliance with such new requirements, which may also require significant

management time and other resources, and any failure to comply may adversely affect our business, results of

operations and prospects. Uncertainty in the applicability, interpretation or implementation of any amendment

to, or change in, governing law, regulation or policy, including by reason of an absence, or a limited body, of

administrative or judicial precedent may be time consuming as well as costly for us to resolve and may affect

the viability of our current business or restrict our ability to grow our business in the future.

8. Instability in financial markets could materially and adversely affect our results of operations and


The Indian economy and financial markets are significantly influenced by worldwide economic, financial and

market conditions. Any financial turmoil, especially in the United States of America or Europe, may have a

negative impact on the Indian economy. Although economic conditions differ in each country, investors’

reactions to any significant developments in one country can have adverse effects on the financial and market

conditions in other countries. A loss in investor confidence in the financial systems, particularly in other

emerging markets, may cause increased volatility in Indian financial markets. The global financial turmoil, an

outcome of the sub-prime mortgage crisis which originated in the United States of America, led to a loss of

investor confidence in worldwide financial markets. Indian financial markets have also experienced the

contagion effect of the global financial turmoil, evident from the sharp decline in SENSEX, BSE’s benchmark

index. Any prolonged financial crisis may have an adverse impact on the Indian economy and us, thereby

resulting in a material and adverse effect on our business, operations, financial condition, profitability and price

of our Equity Shares.

9. Natural calamities could have a negative impact on the Indian economy and cause Our Company’s

38

business to suffer.

India has experienced natural calamities such as earthquakes, tsunami, floods etc. In recent years, the extent and

severity of these natural disasters determine their impact on the Indian economy. Prolonged spells of abnormal

rainfall or other natural calamities could have a negative impact on the Indian economy, which could adversely

affect our business, prospects, financial condition and results of operations as well as the price of the Equity

Shares.

10. Government regulation of foreign ownership of Indian securities may have an adverse effect on the price

of the Equity Shares.

Foreign ownership of Indian securities is subject to government regulation. Under foreign exchange regulations

currently in effect in India, transfer of shares between non-residents and residents are freely permitted (subject

to certain exceptions) if they comply with the pricing guidelines and reporting requirements specified by the

RBI. If the transfer of shares, which are sought to be transferred, is not in compliance with such pricing

guidelines or reporting requirements or fall under any of the exceptions referred to above, then the prior

approval of the RBI will be required. Additionally, shareholders who seek to convert the rupees proceeds from

the sale of shares in India into foreign currency and repatriate that foreign currency from India will require a no

objection/ tax clearance certificate from the Income Tax authorities. There can be no assurance that any

approval required from the RBI or any other government agency can be obtained.

11. Political, economic and social changes in India could adversely affect our business.

Our business, and the market price and liquidity of our Company’s shares, may be affected by changes in

Government policies, including taxation, social, political, economic or other developments in or affecting India

could also adversely affect our business. Since 1991, successive governments have pursued policies of

economic liberalization and financial sector reforms including significantly relaxing restrictions on the private

sector. In addition, any political instability in India may adversely affect the Indian economy and the Indian

securities markets in general, which could also affect the trading price of our Equity Shares.

12. Our transition to Ind AS or IFRS reporting could have an adverse effect on our reported results of

operations or financial condition.

On January 2, 2015, the Ministry of Corporate Affairs, Government of India (MCA) announced the revised

roadmap for the implementation of Ind AS for companies other than banking companies, insurance companies

and non-banking finance companies through a press release. On February 16, 2015, the MCA issued the

Companies (Indian Accounting Standards) Rules, 2015 (Indian Accounting Standard Rules) to be effective from

April 1, 2015. The Indian Accounting Standard Rules provide for voluntary adoption of Ind AS by companies in

financial year 2015 and, implementation of Ind AS will be applicable from April 1, 2016 to companies with a

net worth of Rs.5,000 million or more. Additionally, Ind AS differs in certain respects from IFRS and therefore

financial statements prepared under Ind AS may be substantially different from financial statements prepared

under IFRS. There can be no assurance that the adoption of Ind AS by our Company will not adversely affect its

results of operation or financial condition. Any failure to successfully adopt Ind AS in accordance with the

prescribed timelines may have an adverse effect on the financial position and results of operation of our

Company.

13. Our business is dependent on the Indian economy.

The performance and growth of our business are necessarily dependent on economic conditions prevalent in

India, which may be materially and adversely affected by center or state political instability or regional

conflicts, a general rise in interest rates, inflation, and economic slowdown elsewhere in the world or otherwise.

There have been periods of slowdown in the economic growth of India. India’s economic growth is affected by

various factors including domestic consumption and savings, balance of trade movements, namely export

demand and movements in key imports (oil and oil products), global economic uncertainty and liquidity crisis,

volatility in exchange currency rates and annual rainfall which affects agricultural production. Any continued or

future slowdown in the Indian economy or a further increase in inflation could have a material adverse effect on

the price of our raw materials and demand for our products and, as a result, on our business and financial results.

The Indian financial market and the Indian economy are influenced by economic and market conditions in other

countries, particularly in emerging market in Asian countries. Financial turmoil in Asia, Europe, the U.S. and

elsewhere in the world in recent years has affected the Indian economy. Although economic conditions are

39

different in each country, investors’ reactions to developments in one country can have adverse effects on the

securities of companies in other countries, including India. A loss in investor confidence in the financial systems

of other emerging markets may cause increased volatility in Indian financial markets and, indirectly, in the

Indian economy in general. Any worldwide financial instability, including the financial crisis and fluctuations in

the stock markets in China and further deterioration of credit conditions in the U.S. or European markets, could

also have a negative impact on the Indian economy. Financial disruptions may occur again and could harm our

business and financial results.

Prominent Notes:

1. Public Issue up to 24,00,000 Equity Shares of Face Value of Rs. 10/- each of Preet Remedies Limited

("PRL" or "Our Company" or "The Issuer") for cash at a price of Rs. 51/- per Equity Share (Including a

Share Premium of Rs. 41/- per Equity Share) ("Issue Price") aggregating to Rs. 1224.00Lakhs, of which up

to 1,20,000 Equity Shares of Face Value of Rs. 10 each at a price of Rs. 51/- aggregating to Rs. 61.20

Lakhs will be reserved for subscription by Market Maker ("Market Maker Reservation Portion") and Net

Issue to Public up to 22,80,000 Equity Shares of Face Value of Rs. 10/- each at a price of Rs. 51/-per

Equity Share aggregating to Rs. 1162.80 Lakhs (hereinafter referred to as the "Net Issue"). The Issue and

the Net Issue will constitute 28.57% and 27.14% respectively of the Post Issue paid up Equity Share Capital

of our Company.

2. This Issue is being made for at least 25 % of the post- issue paid-up Equity Share capital of our Company,

pursuant to Rule 19(2)(b)(i) of the Securities Contracts (Regulation) Rules, 1957 as amended. This Issue is

being made in terms of Chapter XB of the SEBI (ICDR) Regulations, 2009, as amended from time to time.

As per Regulation 43(4) of the SEBI (ICDR) Regulations, as amended, since our is a fixed price issue ‘the

allocation’ is the net issue to the public category shall be made as follows:

a) Minimum fifty percent to retail individual investors; and

b) Remaining to

(i) Individual applicants other than retail individual investors; and

(ii) Other investors including corporate bodies or institutions, irrespective of the number

of specified securities applied for

c) The unsubscribed portion in either of the categories specified in (a) or (b) above may be

allocated to the applicants in the other category.

If the retail individual investor category is entitled to more than fifty per cent on proportionate basis,

accordingly the retail individual investors shall be allocated that higher percentage.

3. The net worth of our Company as onMarch 31, 2018, March 31, 2017 and March 31, 2016 was Rs.

2055.28lakhs, Rs.1851 lakhs and Rs. 1771.54 lakhs respectively based on Restated Financial Statements.

For further details, please refer to the chapter titled "Financial Information" beginning on page 151 of this

Draft Prospectus.

4. The NAV / Book Value per Equity Share, based on Restated Financials of our Company as on March 31,

2018, March 31, 2017 and March 31, 2016 was Rs. 34.25, Rs. 61.70 and Rs.59.09 per equity share

respectively based on Restated Financial Statements. For further details, please refer to the chapter titled

"Financial Information of the Company" beginning on page 151 of this Draft Prospectus.

5. The average cost of acquisition of Equity Shares by our Promoter is set out below:

Sr. No. Name of our Promoters Number of Equity Shares

Held

Average Cost of

Acquisitions per shares

(Rs.)

1. Sanjeev Kumar 16,84,000 0.37

2. Harpreet Singh 9,04,000 0.42

3. Sanjay Dhir 8,00,000 0.00

4. Satish Kumar 8,88,000 0.37

For further details, please refer to the chapter titled "Capital Structure" beginning on 63 of this Draft Prospectus.

6. The details of transactions of our Company with related parties, nature of transactions and the cumulative

value of transactions please refer to chapter titled "Financial Information of the Company – Annexure XXVI

40

Statement of Related Parties Transactions.

7. None of our Associate Companies have any business or other interest in our Company, except as stated in

section titled "Financial Information of the Company - Annexure XXVI -Statement of Related Parties

Transactions, as Restated" beginning on page 199 and "Our Group Companies" beginning on page 141 of

this Draft Prospectus and to the extent of any Equity Shares held by them and to the extent of the benefits

arising out of such shareholding.

8. Our Company was originally incorporated as ‘Preet Remedies Private Limited’ on February 10, 2005 with

the Registrar of Companies, Jalandhar as a Private Limited company under the provisions of the Companies

Act, 1956. Subsequently, our Company was converted into a Public Limited Company and the name of our

Company was changed to ‘Preet Remedies Limited’. A fresh certificate of incorporation consequent upon

conversion to public limited Company was issued by the Registrar of Companies, Chandigarh on February

06, 2018. The registered office of our company is situated atPlot no. 194-195, 3rd Floor, Industrial Area

Phase-II, Chandigarh-160002. The corporate identity number of our Company is

U24230CH2005PLC027954. For further details, please refer to the chapter titled "History and Certain

Corporate Matters" beginning on page 120 of this Draft Prospectus.

9. None of our Promoter, Promoter Group, Directors and their relatives have entered into any financing

arrangement or financed the purchase of the Equity Shares of our Company by any other person during the

period of six months immediately preceding the date of filing of Draft Prospectus.

10. Our Company, Promoter, Directors, Promoter Group have not been prohibited from accessing the Capital

Market under any order or direction passed by SEBI nor they have been declared as willful defaulters by

RBI / Government authorities. Further, no violations of securities laws have been committed by them in the

past or pending against them.

11. Investors are advised to refer to the chapter titled "Basis for Issue Price" beginning on page 78 of this Draft

Prospectus.

12. The Lead Manager and our Company shall update this Draft Prospectus and keep the investors / public

informed of any material changes till listing of the Equity Shares offered in terms of this Draft Prospectus

and commencement of trading.

13. Investors are free to contact the Lead Manager i.e. Mark Corporate Advisors Private Limited for any

clarification, complaint or information pertaining to the Issue. The Lead Manager and our Company shall

make all information available to the public and investors at large and no selective or additional information

would be made available for a section of the investors in any manner whatsoever.

14. In the event of over-subscription, allotment shall be made as set out in paragraph titled "Issue Procedure-

Basis of Allotment" beginning on page 244 of this Draft Prospectus and shall be made in consultation with

the Designated Stock Exchange i.e. National Stock Exchange of India Limited. The Registrar to the Issue

shall be responsible to ensure that the basis of allotment is finalized in a fair and proper manner as set out

therein.

15. The Directors / Promoters of our Company have no interest in our Company except to the extent of

remuneration and reimbursement of expenses (if applicable) and to the extent of any Equity Shares of our

Company held by them or their relatives and associates or held by the companies, firms and trusts in which

they are interested as director, member, partner, and/or trustee, and to the extent of benefits arising out of

such shareholding. For further details, please refer to the chapter titled "Our Management", "Our Promoter

and Promoter Group", "Financial Information of the Company" beginning on pages 123, 136 and 151,

respectively of this Draft Prospectus.

16. No loans and advances have been made to any person(s) / companies in which Directors are interested

except as stated in the Auditors Report. For details, please refer to the section titled "Financial Information

of the Company" beginning on page 151 of this Draft Prospectus.

17. Trading in the Equity Shares for all investors shall be in dematerialized form only.

18. No part of the Issue proceeds will be paid as consideration to Promoters, Promoter Group, Directors, Key

41

Managerial Personnel or Associate Companies.

For information on the changes of the objects clause of the Memorandum of Association of our

Company, please refer to the chapter titled "History and Certain Corporate Matters" beginning on

page 120 of this Draft Prospectus.

42

SECTION III - INTRODUCTION

SUMMARY OF OUR INDUSTRY

INTRODUCTION TO THE INDIAN PHARMACEUTICAL INDUSTRY

The Indian pharmaceutical industry has contributed immensely not just to Indian but to global healthcare

outcomes. India continues to play a material role in manufacturing various critical, high‐ quality and low‐cost

medicines for Indian and global markets. It supplies 50 to 60 percent of global demand for many vaccines

(including ARVs), 40 percent of generics consumed in the US and 25 percent of all the medicines dispensed in

the UK1. Over the last 5 years, 35 to 38 percent of total ANDAs approved (including 25 to 30 percent of total

injectable ANDAs) have been filed from Indian sites2. Affordable anti‐retroviral (ARV) drugs from India were

a major factor in AIDS patients getting greater access to treatment. India supplies 60 percent of global ARV

drugs and 30 percent of the annual UNICEF requirement.

(Source: FICCI Report Trends & Opportunity for Indian Pharma 2018)

The Indian pharmaceuticals market is the third largest in terms of volume and thirteenth largest in terms of

value, as per a report by Equity Master. India is the largest provider of generic drugs globally with the Indian

generics accounting for 20 per cent of global exports in terms of volume. Of late, consolidation has become an

important characteristic of the Indian pharmaceutical market as the industry is highly fragmented.

India enjoys an important position in the global pharmaceuticals sector. The country also has a large pool of

scientists and engineers who have the potential to steer the industry ahead to an even higher level. Presently over

80 per cent of the antiretroviral drugs used globally to combat AIDS (Acquired Immuno Deficiency Syndrome)

are supplied by Indian pharmaceutical firms.

The UN-backed Medicines Patent Pool has signed six sub-licences with Aurobindo, Cipla, Desano, Emcure,

Hetero Labs and Laurus Labs, allowing them to make generic anti-AIDS medicine TenofovirAlafenamide

(TAF) for 112 developing countries.

(Source: https://www.ibef.org/industry/pharmaceutical-india.aspx)

(Source: Indian Pharmaceuticals Industry Report (May 2018)

https://www.ibef.org/industry/pharmaceutical-india.aspx

43

Market Size

Indian pharmaceutical sector is estimated to account

for 3.1 – 3.6 per cent of the global pharmaceutical

industry in value terms and 10 per cent in volume

terms. It is expected to grow to US$100 billion by

2025. The market is expected to grow to US$ 55

billion by 2020, thereby emerging as the sixth

largest pharmaceutical market globally by absolute

size. Branded generics dominate the pharmaceuticals

market, constituting nearly 80 per cent of the market

share (in terms of revenues).

India’s pharmaceutical exports stood at US$ 16.8 billion in 2016-17 and are expected to grow by 30 per cent

over the next three years to reach US$ 20 billion by 2020, according to the Pharmaceuticals Export Promotion

Council of India (PHARMEXCIL). Export of pharmaceutical items reached ₹ 696.84 billion (US$ 10.76 billion)

during April 2017 – January 2018.

The Pharmaceutical sector is expected to generate 58,000 additional job opportunities by the year 2025

Indian companies received 304 Abbreviated New Drug Application (ANDA) approvals from the US Food and

Drug Administration (USFDA) in 2017. The country accounts for around 30 per cent (by volume) and about 10

per cent (value) in the US$ 70-80 billion US generics market.

India's biotechnology industry comprising bio-pharmaceuticals, bio-services, bio-agriculture, bio-industry and

bioinformatics is expected grow at an average growth rate of around 30 per cent a year and reach US$ 100

billion by 2025. Biopharma, comprising vaccines, therapeutics and diagnostics, is the largest sub-sector

contributing nearly 62 per cent of the total revenues at ₹ 12,600 crore (US$ 1.89 billion).


Investments

The Union Cabinet has given its nod for the amendment of the existing Foreign Direct Investment (FDI) policy

in the pharmaceutical sector in order to allow FDI up to 100 per cent under the automatic route for

manufacturing of medical devices subject to certain conditions.

The drugs and pharmaceuticals sector attracted cumulative FDI inflows worth US$ 15.59 billion between April

2000 and December 2017, according to data released by the Department of Industrial Policy and Promotion

(DIPP).

Some of the recent developments/investments in the Indian pharmaceutical sector are as follows:

As of March 2018, a consortium led by Indian private equity firm Chrys Capital is planning to buy a 10

per cent stake in Mankind Pharma for US$ 350 million.

The exports of Indian pharmaceutical industry to the US will get a boost, as branded drugs worth US$

55 billion will become off-patent during 2017-2019.

Private equity and venture capital (PE-VC) investments in the pharmaceutical sector have grown at 38

per cent year-on-year between January-June 2017, due to major deals in this sector.



44

SUMMARY OF OUR BUSINESS

Our Company was originally incorporated as ‘Preet Remedies Private Limited’ on February 10, 2005 with the

Registrar of Companies, Jalandhar as a Private Limited company under the provisions of the Companies Act,

1956. Subsequently, our Company was converted into a Public Limited Company and the name of our Company

was changed to ‘Preet Remedies Limited’. A fresh certificate of incorporation consequent upon conversion to

public limited Company was issued by the Registrar of Companies, Chandigarh on February 06, 2018. The

Corporate Identification Number of our Company is U24230CH2005PLC027954.

Our Company is working as a contract manufacturing company in India. With the help of our production unit,

we are capable to deliver the variety of product range to our customers. We have the capacity to deliver all type

of product range such as a Tablets Capsules, Ointment, Cream, Gel, Lotion, Shampoo & Dry syrup. Being a

third-party Pharma Manufacturing, we make use of best quality raw material and cutting-edge tools.

Our registered and corporate office is situated at Chandigarh and manufacturing unit of our Company is located

at Baddi, Himachal Pradesh.

Our Promoters have been instrumental in shaping the value system of our Company. With their rich experience

of two decades, we shall continue to grow in the pharmaceutical industry. We value our customers and aim to

exceed the expectations of our customers by offering diverse products and fulfilling valuable commitments.

OUR BUSINESS ACTIVITY

DOMESTIC MARKET OPERATION

We are mainly engaged in third party manufacturing of Tablets, Capsules, Ointment, Cream, Gel, Lotion, Dry

Syrup and Shampoo, these Products are manufactured at our existing facility.

SALES AND MARKETING STRATEGY

The efficiency of the marketing and sales network is critical to the success of every Company. Our success lies

in the strength of our relationship with our channels that are associated with our Company.

Contract Manufacturing Pharma–We are one of the leading Contract Manufacturing Company in Baddi. With

the help of our large-scale production unit, we are capable to deliver the variety of drug ranges to our associates.

We have the capacity to deliver all type of product range such as a Tablets, Capsules, Ointment, Cream, Gel,

Lotion, Shampoo and Dry Syrup. We make use of best quality raw material and cutting-edge tools.

Domestic Market

(Manufacturing)

TABLETS CAPSULES OINTMENT CREAM, GEL

& SHAMPOO

LOTION & DRY SYRUP

45

EXPERIENCE PROMOTER AND MANAGEMENT TEAM

Our Promoters are engaged in the pharmaceutical business since more than two decades and has good

experience in the pharmaceutical industry. Also, our Company is managed by a team of dedicated personnel.

The experience of our management team and dedicated personnel enable us to continue to take advantage of

both current and future market opportunities thus expanding our business horizons.

PRODUCT RANGE

We are capable to deliver the variety of drug range to our esteemed customers. It consists of all the essential

drugs which have high demand in the market. The formulations which we are delivering to our customers are as

under:

Oral Solid Dosages Forms

Tablets

Capsules

Dry Syrup

External Preparations

Ointment

Cream

Gel

Lotion

Shampoo

All our offered drugs are quality approved and available at reasonable prices.

With the help of our comprehensive experience in producing pharma products, we help our associates with the

variety of flawless drug range. We annually manufacture or deliver around 400+ drugs segment to our

customers. We possess 13 years of working experience, in producing and supplying the variety of drug range.

We bring transparency in our work so that our associates can inspect and be satisfied with each business

operation and can detect whether they are going smoothly or not. Below are the highlights of our company:

Ability to deliver the variety of drug range to our customers

Make on-time delivery of products

Variety of drug range at just one platform

All the drugs are available at reasonable prices

DCGI and GMP approved drug range

OUR TOP 10 CUSTOMERS ARE AS FOLLOWS:-

1. Zydus Healthcare Limited

2. Intas Pharmaceuticals Limited

3. Alkem Laboratories Private Limited

4. Zenlabs Ethica Limited

5. Wockhardt Limited

6. Smart Laboratories Private Limited

7. Morepen Laboratories Limited

8. Care Formulation Private Limited

9. Elixir Life Care Private Limited

10. Knoll Healthcare Private Limited

46

BRAND IMAGE

We would continue to associate ourselves with good quality customers and execute projects to their utmost

satisfaction. We are highly conscious about our brand image and intend to continue our brand building exercise

by providing excellent services to the satisfaction of the customers. Leading medicine which we manufacture for

our customers are as under: -

Drugs Products Customers Uses

Mecofol plus NF Capsule Intas Pharmaceuticals

Limited

Multivitamin used for

nervous system

Intagesic plus Gel Intas Pharmaceuticals

Limited

Analgesic, mussel

relaxant

App UP Tablet Intas Pharmaceuticals

Limited

Appetizer

FCN 150 Tablet Intas Pharmaceuticals

Limited

Antifungal

Soregel Tablet Intas Pharmaceuticals

Limited

Antibiotic mouth ulser

gel

Thrombotas Ointment Intas Pharmaceuticals

Limited

Anticoagulant

Acceclowoc SP Tablet Wockhardt Limited Analgesic, anti-

inflamatory

Wofol Z Capsule Wockhardt Limited Heamatinic

Shevcal Tablet Knoll Healthcare Private

Limited

Calcium & vitd3

replenisher

Ramirace2.50 Tablet Knoll Healthcare Private

Limited

antihypertensive

Ramirace 5 Tablet Knoll Healthcare Private

Limited

antihypertensive


Limited

antihypertensive

D-fress MR Tablet Smart Laboratories Private

Limited

Analgesic, mussel

relaxant

Norfresh TZ Tablet Smart Laboratories Private

Limited

Antiparasite antibiotic

Dolofresh MR Tablet Smart Laboratories Private

Limited

Analgesic, mussel

relaxant

Dolofresh SP Tablet Smart Laboratories Private

Limited

Analgesic, anti-

inflamatory.

PRODUCT ARTWORK

Our company manufacture the drugs through Product Artwork. The purpose of Product Artwork is to distinctly

brand the product so that it is distinguishable and attractive to the potential consumer. As with the project

software, the vision and product features and associated artwork are refined over successive iterations. The

product artwork is created by the Customer under the direction of the overall project vision, and the exact

artifacts required in mass producing the product. Product artwork includes both the textual and graphical

aspects of the product.

QUALITY ASSURANCE

We believe that quality is an ongoing process of building and sustaining relationships. Our strong

commitment of providing quality products is boasted by our industry knowledge. We have obtained Goods

Manufacturing Practices (WHO Technical Reports 37th Series 908 - Thirty Seventh Report 2003 published

by WHO) for the Quality Management from Euro Conformity Assessment for our Export-Import and

manufacturing operations involving Pharmaceutical Materials, Formulations items. Further, we ensure that

our third-party manufacturing facilities are accredited with the necessary approvals and provide quality

47

output for our customers.

OUR BUSINESS STRATEGY

We envisage long term growth by supplying qualitative products and building long term relations with

customers. In line with this vision, our Company is implementing a business strategy with the following key

components. Our strategy will be to focus on capitalizing on our strengths and expanding the operations of our

business. We intend to focus on our existing range of products with specific emphasis on the following factors

as business and growth strategy:

1. Leveraging our Market Skills and relationship

Leveraging our market skills and relationships is a continuous process in our organization and the skills that we

impart in our Employees give value for money to our customers. We aim to do this by leveraging our market

skills and relationships.

2. Customer Satisfaction

The business of our Company is customer oriented and always strives to maintain good relationship with the

customers. Our Company‘s marketing team approaches existing customers for their feedback and based on their

feedback any changes in the products if required are carried out. Our Company provides quality products and

effective follow-ups with customers who ensure that the customers are satisfied with the product and do not

have any complaint.

3. Scalable Business Model

Our Business model is customer centric and order driven, and requires optimum utilization of our existing

resources, assuring quality supply and achieving consequent economies of scale. The business scale generation

is basically due to development of new markets by exploring customer needs, marketing expertise and by

maintaining the consistent quality output. We believe that our business model is scalable.

Leveraging our Market Skills and relationship

Scalable Business Model

Customer Satisfaction

48

SUMMARY OF OUR FINANCIAL STATEMENTS

The following summary of financial statements have been prepared in accordance with Indian GAAP, the

companies Act and the SEBI (ICDR) Regulations 2009 and restated as described in the Peer Review Auditor’s

Report in the chapter titled ‘Financial Statements’ beginning on Page No. 151 of this Prospectus. The summary

financial information presented below should be read in conjunction with our restated financial statements for

the financial year ended March 31, 2018, 2017, 2016, 2015 and 2014 including the notes thereto and the chapter

titled ‘Management’s Discussion and Analysis of Financial Condition and Results of Operations’ on Page No.

204 of this Prospectus.

Statement of Consolidated Assets and Liabilities, as Restated (` in Lakhs)

Particulars As at March 31,

2018 2017 2016 2015 2014

EQUITY AND LIABILITIES

Shareholders’ Funds

a) Share Capital 600.00 300.00 300.00 300.00 300.00

b) Reserves & Surplus 1720.00 1746.28 1597.10 1408.93 1456.46

Non - Controlling Interest 34.05 30.51 31.45 16.17 -

Share Application Money

Pending Allotment

Non-Current Liabilities

(a) Long-Term Borrowings 497.18 489.61 202.02 130.33 38.89

(b) Long term provision - - - - -

(c) Other Long Term Liabilities - - - - -

(d) Deferred Tax Liability(Net) - - - - -

Current Liabilities

(a) Short-Term Borrowings 762.29 541.07 458.06 656.84 622.55

(b) Trade Payables 2711.70 2168.80 1927.28 2019.33 1623.59

(c) Other Current Liabilities 297.04 436.77 200.66 125.77 116.90

(d) Short-Term Provisions 30.24 42.90 24.40 19.55 6.43

T O T A L 6652.50 5755.93 4740.98 4676.93 4164.83

ASSETS

Non-Current Assets

(a) Fixed Assets

- Tangible Assets 663.15 722.66 690.42 809.50 550.27

- Intangible Assets - - - - -

- Capital Work in Progress 1230.53 492.61 - - -

(b) Non-Current Investments 361.74 333.63 210.53 113.09 431.82

(c) Deferred Tax Assets (Net) 35.59 38.59 23.44 16.24 6.06

(d) Long Term Loans And

Advances 110.80 114.00 142.48 149.83 154.08

(e) Other Non-Current Assets - - - - -

Current Assets

a. Inventories 987.76 665.01 731.01 741.55 605.00

b. Trade Receivables 2618.88 2983.54 2540.76 2331.36 1991.24

c. Cash and Cash Equivalents 297.20 280.67 278.55 386.98 373.26

d. Short Term Loans & Advances 213.32 9.25 19.48 10.58 7.93

e. Other Current Assets 133.53 115.98 104.32 117.79 45.17

T O T A L 6652.50 5755.93 4740.98 4676.93 4164.83

49

Statement of Consolidated Profit & Loss, as Restated (` in Lakhs)

Particulars For the year ended March 31,

2018 2017 2016 2015 2014

Revenue:

Revenue From Operations (Net of

Taxes)

6698.92 8083.00 7505.83 7596.65 5735.63

Other Income 59.23 24.84 (3.36) (99.14) 64.28

Total Revenue 6757.47 8107.84 7502.48 7497.51 5799.90

Expenses:

Cost of Material Consumed 5014.29 6532.90 5840.75 6297.14 4797.41

Manufacturing & Operating Costs 382.76 400.32 358.88 206.98 148.11

Purchase of Stock-in –Trade - - - - -

Changes in inventories of finished

goods, work-in-progress and

Stock-in-Trade

(22.73) (24.98) 70.67 (76.84) 72.90

Employee benefit expenses 520.92 533.58 584.17 626.63 363.29

Financial Cost 79.26 81.54 78.85 91.45 85.27

Depreciation and amortization

expenses

90.39 102.18 103.49 152.77 74.34

Others Expenses 284.32 251.22 316.34 157.01 140.39

Total Expenses 6349.20 7876.75 7353.15 7455.15 5681.71

Profit before exceptional

,extraordinary items and tax

408.28 231.09 149.33 42.37 118.19

Less: Exceptional Items - - - - -

Profit before extraordinary

items and tax (A-B)

408.28 231.09 149.33 42.37 118.19

Prior Period Items - - - - -

Extra ordinary items - - - - -

Profit before tax 408.28 231.09 149.33 42.37 118.19

Tax expense :

Current tax 94.95 55.25 47.50 47.66 13.47

Deferred Tax 3.00 (15.15) (7.19) (10.18) (1.70)

Earlier years - - - - 9.36

Profit/(Loss) for the period After

Tax-PAT 310.32 190.99 109.02 4.89 97.06

50

Statement of Consolidated Cash Flow, as Restated (` in Lakhs)


2018 2017 2016 2015 2014

Cash Flow From Operating

Activities:

Net Profit before tax as per Profit

And Loss A/c

408.28 231.09 149.33 42.37 118.19

Adjustments for:

Depreciation & Amortisation

Expense

90.39 102.18 103.49 152.77 74.34

Interest Charged to P&L 79.26 81.54 78.85 91.45 85.27

Interest Income -16.81 -17.21 -18.16 -18.50 -16.35

Finance Cost

Dividend Received -6.71 -0.03 -0.03 -0.02 -0.01

Deferred Tax Adjustment 3.00 -15.15 1.42 - -

MAT Adjustment -85.60 -36.20 - - -

Provision for Gratuity 3.46 -5.40 2.78 - -

Loss on Sale of Fixed Asset - - 81.54 - -

Operating Profit Before Working

Capital Changes

475.26 340.81 399.22 268.07 261.43

Adjusted for (Increase)/ Decrease in:

Short Term Provision -9.65 3.34 -2.34 2.93 -

Trade Receivables 364.66 -442.78 -209.40 -340.11 -568.90

Other Receivables - - - - 29.81

Short Term Loan & Advances -221.63 -1.44 -20.16 -95.70 -

Inventories -322.75 66.00 10.53 -136.55 217.72

Other Current Assets - - 24.74 20.43 -

Trade Payables 542.90 241.53 -92.05 395.73 501.11

Short Term Borrowings 221.23 83.00 -198.78 34.30 -

Other Current Liabilities -139.73 236.10 74.89 8.87 -129.42

Cash Generated From Operations 435.03 185.76 -412.56 -110.10 50.31

Appropriation of Profit - - - - -

Net Income Tax paid/ refunded -95.97 -55.25 -47.50 -47.73 -27.92

Net Cash Flow from/(used in)

Operating Activities: (A)

830.32 471.32 -60.85 110.23 283.83

Cash Flow From Investing

Activities:

Net (Purchases)/Sales of Fixed

Assets (including capital work in

progress)

-768.81 -627.02 -65.95 -45.26 -85.98

Long Term Loans & Advances 3.20 28.48 7.35 4.25 13.44

Investments 16.00 -93.96 - -74.01 -32.85

Interest on FD 16.81 17.22 18.16 18.50 16.35

Dividend received 6.71 0.03 0.03 0.02 0.01


Investing Activities: (B)

-726.10 -675.26 -40.42 -96.50 -89.02

Cash Flow from Financing

Activities:

Net Increase/(Decrease) in Long

Term Borrowings

7.57 287.59 71.69 91.44 9.71

Interest on Borrowings -79.26 -81.54 -78.85 -91.45 -85.27


Financing Activities (C)

-71.69 206.05 -7.16 -0.01 -75.56

Net Increase/(Decrease) in Cash &

Cash Equivalents (A+B+C)

16.54 2.12 -108.43 13.72 119.25

Cash & Cash Equivalents As At

Beginning of the Year

280.67 278.55 386.98 373.26 254.00

51


End of the Year

297.20 280.67 278.55 386.98 373.26

52

Statement of Standalone Assets and Liabilities, As Restated (` in Lakhs)


2018 2017 2016 2015 2014



c) Share Capital 600.00 300.00 300.00 300.00 300.00

d) Reserves & Surplus 1455.28 1551.00 1471.54 1437.10 1408.61


Pending Allotment






Current Liabilities


(b) Trade Payables 2049.30 1716.80 1431.86 1607.86 1623.59



T O T A L 5508.90 4861.31 3859.37 4120.78 4116.98

ASSETS

Non-Current Assets

(a) Fixed Assets

- Tangible Assets 375.34 414.75 348.52 453.14 550.27






Advances 110.80 114.00 142.48 149.83 154.08


Current Assets

a. Inventories 727.55 541.19 665.71 667.33 605.00




e. Other Current Assets - - - 24.74 45.17

T O T A L 5308.18 4861.31 3859.37 4120.78 4116.98

53

Statement of Standalone Profit & Loss, as Restated (` in Lakhs)


2018 2017 2016 2015 2014

Revenue:


Taxes)

5384.92 6331.04 5364.26 6051.77 5735.63

Other Income 23.32 17.24 18.18 19.08 16.43

Total Revenue 5408.24 6348.28 5382.44 6070.84 5752.05

Expenses:



Purchase of Stock-in -Trade - - - - -


goods, work-in-progress and Stock-in-

Trade

(22.73) (24.98) 70.67 (76.84) 72.90


Financial Cost 58.23 55.28 57.14 69.99 85.27


expenses

49.99 57.68 55.63 101.90 74.34

Others Expenses 238.01 185.45 261.78 135.49 140.39

Total Expenses 5125.44 6212.92 5333.71 6018.29 5681.71



282.80 135.36 48.74 52.56 70.34


Profit before extraordinary items

and tax (A-B)

282.80 135.36 48.74 52.56 70.34




Tax expense :

Current tax 74.15 34.85 19.20 22.39 13.47

Deferred Tax 3.00 (15.15) (7.19) (10.18) (1.70)


Minority Interest - - - - -

Profit/(Loss) for the period After Tax-

PAT

205.65 115.66 36.73 40.35 49.22

54

Statement of Standalone Cash Flow, as Restated (` in Lakhs)


2018 2017 2016 2015 2014


Activities:

Net Profit before tax as per Profit And

Loss A/c

282.80 135.36 48.74 52.56 70.34

Adjustments for:

Depreciation & Amortisation Expense 49.99 57.68 55.63 101.90 74.34

Interest Income (16.61) - 39.30 52.59 68.92

Finance Cost 58.23 - - - -

Dividend Received (6.71) - - - -

Deferred Tax Adjustment (1.36) - - - -

Income tax adjustment (74.15) (34.85) - - -

MAT Adjustment - (36.20) - - -

Provision for Gratuity - - 2.77 - -



Capital Changes

292.19 121.99 227.98 207.04 213.60


Decrease / (Increase) in Current /

Non-Current Assets 65.29 (426.92) - - -

(Decrease) / Increase in Current /

Non-Current Liabilities 393.89 639.15 - - -

Trade Receivables - - 30.33 15.96 (568.90)

Other Receivables - - 15.85 17.78 29.81

Inventories - - 1.62 (62.34) 217.72

Trade Payables - - (177.91) (15.73) 501.11

Other Current Liabilities - - (134.65) (6.80) (129.42)

Cash Generated From Operations 459.18 212.23 (264.75) (51.13) 50.31


Net Income Tax paid/ refunded - - 8.50 (15.89) (27.92)



751.37 334.21 (28.27) 140.02 235.99


Activities:

Net (Purchases)/Sales of Fixed Assets

(including capital work in progress)

(748.50) (616.52) (32.55) (5.84) (85.98)

Loans & Advances - - - 4.26 13.44

Investments - - 5.25 (59.01) 15.00

Interest on FD - - 17.84 17.40 16.35

Interest & Dividend received 23.32 - - - -

Net (Increase)/Decrease in Long

Term Loans & Advances

- - - - -



(725.18) (616.52) (9.46) (43.19) (41.18)


Activities:

Proceeds From issue of Share Capital - - - - -

Net Increase/(Decrease) in Long Term

Borrowings

49.41 283.33 (8.71) (19.45) 9.71

Net Increase/(Decrease) in Short Term

Borrowings

- - - - -

Net Increase/(Decrease) in Other Long

Term Liabilities

- - - - -

Interest on Borrowings (58.23) - (57.14) (69.99) (85.27)

Net Cash Flow from/(used in) (8.82) 283.33 (65.85) (89.44) (75.56)

55




17.37 1.03 (103.58) 7.39 119.25



278.10 277.07 380.65 373.26 254.01

Cash & Cash Equivalents As At End

of the Year 295.47 278.10 277.07 380.65 373.26

56

THE ISSUE

Particulars No of Equity Shares

Equity Shares Offered* 24,00,000 Equity Shares of face value of ₹10 each fully paid of

the Company for cash at price of ₹51 per Equity Share

aggregating ₹1,224 Lakhs

Fresh Issue consisting of:

Issue Reserved for Market Maker 1,20,000 Equity Shares of face value of ₹10 each fully paid of

the Company for cash at price of ₹51 per Equity Share

aggregating ₹61.20 Lakhs

Net Issue to Public 22,80,000 Equity Shares of face value of ₹10 each at a price of

₹51 per Equity Share to the Public

of which:

11,40,000 Equity Shares of face value of ₹10 each at a price of

₹51 per Equity Share allocated to the Retail Portion

11,40,000 Equity Shares of face value of ₹10 each at a price of

₹51 per Equity Share allocated to the Non-Retail Portion

Equity Shares outstanding prior to the Issue 60,00,000 Equity Shares

Equity Shares outstanding after the Issue 84,00,000 Equity Shares

Objects of the Issue Please refer chapter “Objects of the Issue” on No. 73 of this

Draft Prospectus

*Public issue of up to 24,00,000 Equity Shares of ₹10 each for cash at a price of ₹51 per Equity Share of our

Company aggregating to ₹1224.00 lakhs is being made in terms of Chapter XB of the SEBI (ICDR)

Regulations, 2009, as amended from time to time. For further details please refer to section “Terms of the Issue”

on Page 238 of this Draft Prospectus.

The Issue has been authorized by our Board pursuant to a resolution dated May, 25 2018 and by our Equity

Shareholders pursuant to a resolution passed at the Extraordinary General Meeting held on June 8, 2018

*As per Regulation 43(4) of the SEBI (ICDR) Regulations, as amended, as present issue is a fixed price offer

the allocation in the net offer to the public category shall be made as follows:

a) Minimum fifty percent to retail individual investors; and

b) Remaining to:

(i) Individual applicants other than retail individual investors; and

(ii) Other investors including corporate bodies or institutions, irrespective of the number of specified

securities applied for;

The unsubscribed portion in either of the categories specified in (a) or (b) above may be allocated to the

applicants in the other category.


accordingly the retail individual investors shall be allocated that higher percentage.

57

GENERAL INFORMATION


Registrar of Companies, Jalandhar as a Private Limited company under the provisions of the Companies Act,

1956. Subsequently our Company was converted into a Public Limited Company and the name of our Company

was changed to ‘Preet Remedies Limited’. A fresh certificate of incorporation consequent upon conversion to

public limited Company was issued by the Registrar of Companies, Chandigarh on February 06, 2018. For

further details of our Company, please refer “General Information” and “History and Certain Other Corporate

Matter” on page no 57 and 120 respectively, of this Draft Prospectus.

Registered Office:

Plot No 194-195, Third Floor, Industrial Area Phase II, Chandigarh – 160 002.

Board of Directors:

Details regarding our Board of Directors as on the date of this Draft Prospectus are set forth in the table

hereunder:

Sr.

No. Name DIN Designation Address

1) Mr. Sanjeev Kumar

Singal 01154896

Managing

Director

H.No. 2629, Sector 70, S.A.S Nagar

Mohali – 160 071

2) Mr. Harpreet Singh 00834180 Executive

Director

House No. 2649, Sector-69, S.A.S. Nagar,

Mohali – 160 062

3) Mr. Satish Kumar 00763060 Executive

Director

House No. 1102, Sector 44 B, Chandigarh

– 160 047

4) Mr. Sanjay Dhir 02452461 Non-Executive

Director

H. No. 1042, Sector 36-C, Chandigarh 160

036

5) Mr. Swapan

Chakraborty 07184333

Executive

Director

46/2, Satyen Roy Branch Road, Behala,

Kolkata – 700 034

6) Mr. Rajesh

Shrivastava 00155198

Independent

Non-Executive

Director

B103, Yogeshwar Co. Op. Society, Novi

no Tarsali Road, Makarpura, Baroda

Gujarat-390 010

7) Mr. Ashok Kumar

Gupta 07330108

Independent

Non-Executive

Director

252, Kamla Nehru Colony, Near Bibiwala

Chowk, Bathinda - 151 001

8) Mrs. Manju Kandhari 08132304

Independent

Non-Executive

Director

186, Block 12, Mohali Employees Co-

operative Society, Sector 68, S.A.S Nagar

Mohali - 160 062

For further details of Management of our Company, please refer to section titled “Our Management” beginning

on Page No.123 of this Prospectus.

Company Secretary & Compliance Officer

Name : Sanjeev Kumar

Address : H No 142, VPO Picholia, Near Dr. Bhim Rao Ambedkar Bhawan, Picholia , Karnal-132 036

Tel No. : + 91-8591022330, 0172-4651105

E-Mail Id : [email protected]

Investors may contact the Compliance Officer and/or the Registrar to the Issue and/or the Lead Manager to the

Issue in case of any Pre-Issue or Post-Issue related matter such as non-receipt of letters of Allotment, credit of

allotted Equity Shares in the respective beneficiary account, unblocking of amount in ASBA etc.

All grievances relating to the ASBA process may be addressed to the Registrar to the Issue, with a copy to the

concerned SCSB, giving full details such as name, address of the applicant, number of Equity Shares applied

for, amount blocked, ASBA Account number and the Designated Branch of the SCSB where the ASBA

Application Form was submitted by the ASBA Applicant.

mailto:[email protected]

58

For all Issue, related queries and for redressal of complaints, Applicants may also write to the Lead Manager.

All complaints, queries or comments received by Stock Exchange/SEBI shall be forwarded to the Lead

Manager, who shall respond to the same.

Chief Financial Officer

Name : Sanjeev Kumar Kanwal

Address : VPO Kunwar Kheri (27) Kurukshetra, Kirmuch, Haryana 136 119

Telefax

No.

: +91-8572842532, 0172-4651105

E-Mail ID : [email protected]

Designated Stock Exchange

Name : National Stock Exchange of India Ltd.

Address : Exchange Plaza, Plot No. C/1, G Block, Bandra- Kurla Complex, Bandra (E), Mumbai- 400

051.

Website : www.nseindia.com

Lead Manager to the Issue

Name : Mark Corporate Advisors Private Limited

Address : 404/1, The Summit Business Bay, Sant Janabai Road (Service Lane),

Off W. E. Highway, Vile Parle (East), Mumbai-400 057.

Tel No. : +91 22 2612 3207/08

Contact Person : Mr. Manish Gaur


SEBI Reg. No. : INM000012128

Investor Grievance E-Mail

ID

: [email protected]

Website : www.markcorporateadvisors.com

Designated Intermediaries

Registrar & Share Transfer Agent

Name : Bigshare Services Private Limited

SEBI Regn

No.

: INR000001385

Address : 1st Floor, Bharat Tin Works Building, Opp. Vasant Oasis, Makhwana Road, Marol,

Andheri (E), Mumbai – 400 059

Contact

Person

: Mr. Ashok S Shetty

Tel No. : +91 22 2847 0652/4043 0200

E-Mail ID [email protected]

Website www.bigshareonline.com

Statutory and Peer Reviewed Auditors

Name : M/s. Vijay Darji and Associates

Address : 1062, 10th Floor Solaris Hubtown N S Phadke Marg, Andheri (East), Mumbai –

400 069

Contact Person : Mr. Vijay Darji

Tel No. : +91 22 2683 0424


Firm Regn No. : 118614W

Legal Advisor to the Issue





http://www.markcorporateadvisors.com/


http://www.bigshareonline.com/


59

Name : M/s. Rajani Associates, Advocates & Solicitors

Address : Krishna Chambers, 59 New Marine Lines, Churchgate, Mumbai-400 020

Tel No. : +91 22 4096 1000

Contact

Person

: Ms. Sangeeta Lakhi

Email : [email protected]

Bankers to the Company

Name of the

Bank

: HDFC Bank

Address : Plot No 28, Industrial Area, phase-I, chandigarh 160 001

Contact Person : Mr. Amit Kumar

Tel No. : 0172-3924551


Website : www.hdfc.com

Bankers to the Issue

Name of the

Bank

: [•]

Address : [•]

Contact Person : [•]

Tel No. : [•]

E-Mail ID : [•]

Website : [•]

Self-Certified Syndicate Banks (SCSB’s):

The lists of banks that have been notified by SEBI to act as SCSBs for the Applications Supported by Blocked

Amount (ASBA) process are provided on http://www.sebi.gov.in. For details on Designated Branches of SCSBs

collecting the ASBA Application Form, please refer to the above-mentioned SEBI link.

Registered Brokers:

Investors can submit Application Forms in the Issue using the stock brokers network of the Stock Exchanges,

i.e., through the Registered Brokers at the Broker Centers. The list of the Registered Brokers, including details

such as postal address, telephone number and email address, is provided on the websites of the National Stock

Exchange of India, as updated from time to time. In relation to ASBA Applications submitted to the Registered

Brokers at the Broker Centers, the list of branches of the SCSBs at the Broker Centers named by the respective

SCSBs to receive deposits of the Application Forms from the Registered Brokers will be available on the

website of the SEBI (www.sebi.gov.in) and updated from time to time.

Registrar to the Issue:

The list of the RTAs eligible to accept ASBA Forms at the Designated RTA Locations, including details such as

address, telephone number and e-mail address, are provided on the websites of Stock Exchange at National

Stock Exchange of India limited, as updated from time to time.

Collecting Depository Participants:

The list of the CDPs eligible to accept Application Forms at the Designated CDP Locations, including details

such as name and contact details, are provided on the website of Stock Exchange at National Stock Exchange of

India Limited, as updated from time to time. The list of branches of the SCSBs named by the respective SCSBs

to receive deposits of the Application Forms from the Designated Intermediaries will be available on the website

of the SEBI (www.sebi.gov.in) and updated from time to time.

Credit Rating:

This being an issue of Equity Shares, there is no requirement of credit rating for the Issue.



http://www.hdfc.com/

60

Trustees:

This being an issue of Equity shares, the appointment of Trustees is not mandatory.

IPO Grading:

Since the Issue is being made in terms of Chapter XB of the SEBI (ICDR) Regulations, there is no requirement

of appointing an IPO Grading agency.

Appraisal and Monitoring Agency:

As per Regulation 16(1) of the SEBI (ICDR) Regulations, 2009 the requirement of Monitoring Agency is not

mandatory if the Issue size is below ₹10,000 Lakhs. Since the Issue size is less than ₹10,000 Lakhs, our

Company has not appointed any monitoring agency for this Issue. However, as per the Regulation 18 (3) read

with part C of schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015,

the Audit Committee of our Company would be monitoring the utilization of the proceeds of the Issue.

Details of the Appraising Authority:

The objects of the Issue and deployment of funds are not appraised by any independent agency/ bank/ financial

institution.

Inter-se Allocation of Responsibilities:

Since, Mark Corporate Advisors Private Limited is the sole Lead Manager to this offer, all the issue related

Activities will be managed by them.

Expert Opinion:

Except the report of Statutory Auditor of our Company on statement of tax benefits included in the Prospectus,

our Company has not obtained any other expert opinion.

Underwriting:

This Issue is 100% Underwritten. The Underwriting Agreement is dated [●] pursuant to the terms of the

underwriting agreement, the obligations of the underwriter are subject to certain conditions specified therein.

The underwriter has indicated its intention to underwrite the following number of specified securities being

offered through this Issue.

Name and Address of the

Underwriter

Indicative

Number of

Equity shares to

be Underwritten

Amount

Underwritten

(₹ in Lakhs)

% of the

Total Issue

Size

Underwritten

Mark Corporate Advisors

Private Limited

404/1, The Summit Business Bay,

Sant Janabai Road (Service Lane),

Off W. E. Highway, Vile Parle

(East),

Mumbai-400 057

[●] [●] [●]

Total [●] [●] [●]

In the opinion of the Board of Directors of the Company, the resources of the above-mentioned underwriter are

sufficient to enable them to discharge their respective underwriting obligations in full. Further, the underwriter

shall be paid a commission at the rate of 1% of the net offer to the public.

Details of the Market Making Arrangement:

61

Our Company and the Lead Manager have entered into a tripartite agreement dated [•] with the following

Market Maker, duly registered with National Stock Exchange of India Limited to fulfill the obligations of

Market Making:

Name : [•]

Address : [•]

Tel No. : [•]

Fax : [•]

Email : [•]

Contact Person : [•]

SEBI Reg. No. : [•]

[Name of the Market Maker, registered with NSE will act as the Market Maker and has agreed to receive or

deliver the specified securities in the market making process for a period of three years from the date of listing

of our Equity Shares or for a period as may be notified by amendment to SEBI (ICDR) Regulations.

The Market Maker shall fulfill the applicable obligations and conditions as specified in the SEBI (ICDR)

Regulations, as amended from time to time and the circulars issued by the NSE and SEBI in this matter from

time to time.

Following is a summary of the key details pertaining to the Market Making arrangement:

1) The Market Maker(s) (individually or jointly) shall be required to provide a 2-way quote for 75% of the

time in a day. The same shall be monitored by the Stock Exchange. Further, the Market Maker(s) shall

inform the Exchange in advance for each and every black out period when the quotes are not being offered

by the Market Maker(s).

2) The minimum depth of the quote shall be ₹1,00,000. However, the investors with holdings of value less

than ₹1,00,000/- shall be allowed to offer their holding to the Market Maker(s) (individually or jointly) in

that scrip provided that he sells his entire holding in that scrip in one lot along with a declaration to the

effect to the selling broker.

3) After a period of three years from the market making period, the market maker would be exempted to

provide quote if the Shares of market maker in our Company reaches to 25% of Issue Size (Including the [•]

Equity Shares to be allotted under this Issue.) Any Equity Shares allotted to Market Maker under this Issue

over and above [•] Equity Shares would not be taken in to consideration of computing the threshold of 25%

of Issue Size. As soon as the Shares of market maker in our Company reduce to 24% of Issue Size, the

market maker will resume providing 2-way quotes.

4) There shall be no exemption/threshold on downside. However, in the event the market maker exhausts his

inventory through market making process, the concerned stock exchange may intimate the same to SEBI

after due verification.

5) Execution of the order at the quoted price and quantity must be guaranteed by the Market Maker(s), for the

quotes given by him.

6) There would not be more than five Market Makers for a script at any point of time and the Market Makers

may compete with other Market Makers for better quotes to the investors. At this stage, [•] is acting as the

sole Market Maker.

7) On the first day of the listing, there will be pre-opening session (call auction) and there after the trading will

happen as per the equity market hours. The circuits will apply from the first day of the listing on the

discovered price during the pre-open call auction.

8) The Marker Maker may also be present in the opening call auction, but there is no obligation on him to do

so.

9) There will be special circumstances under which the Market Maker may be allowed to withdraw

temporarily/fully from the market – for instance due to system problems, any other problems. All

controllable reasons require prior approval from the Exchange, while force-majeure will be applicable for

non- controllable reasons. The decision of the Exchange for deciding controllable and non-controllable

reasons would be final.

10) The Market Maker(s) shall have the right to terminate said arrangement by giving one month notice or on

mutually acceptable terms to the Merchant Banker, who shall then be responsible to appoint a replacement

Market Maker(s).

11) In case of termination of the above mentioned Market Making agreement prior to the completion of the

compulsory Market Making period, it shall be the responsibility of the Lead Manager to arrange for another

Market Maker(s) in replacement during the term of the notice period being served by the Market Maker but

62

prior to the date of releasing the existing Market Maker from its duties in order to ensure compliance with

the requirements of regulation 106V of the SEBI (ICDR) Regulations, 2009. Further the Company and the

Lead Manager reserve the right to appoint other Market Maker(s) either as a replacement of the current

Market Maker or as an additional Market Maker subject to the total number of Designated Market Makers

does not exceed 5 (five) or as specified by the relevant laws and regulations applicable at that particulars

point of time. The Market Making Agreement is available for inspection at our Registered Office from

11.00 a.m. to 5.00 p.m. on working days.

12) Emerge of NSE will have all margins which are applicable on the NSE Main Board viz., Mark-to-Market,

Value-At-Risk (VAR) Margin, Extreme Loss Margin, Special Margins and Base Minimum Capital etc.

NSE can impose any other margins as deemed necessary from time-to-time.

13) Emerge of NSE will monitor the obligations on a real time basis and punitive action will be initiated for any

exceptions and/or non-compliances. Penalties / fines may be imposed by the Exchange on the Market

Maker, in case he is not able to provide the desired liquidity in a particular security as per the specified

guidelines. These penalties / fines will be set by the Exchange from time to time. The Exchange will impose

a penalty on the Market Maker(s) in case he is not present in the market (offering two way quotes) for at

least 75% of the time. The nature of the penalty will be monetary as well as suspension in market making

activities / trading membership.

14) The Department of Surveillance and Supervision of the Exchange would decide and publish the penalties/

fines/ suspension for any type of misconduct/ manipulation/ other irregularities by the Market Maker from

time to time.

15) The price band shall be 20% and the market maker spread (difference between the sell and the buy quote)

shall be within 10% or as intimated by Exchange from time to time.

63

CAPITAL STRUCTURE

The Share Capital of our Company as of the date of this Draft Prospectus before and after the issue is set forth

below:

(₹ in Lakhs)

Sr.

No. Particulars

Aggregate Value at

Face

Value Issue Price

A. AUTHORISED SHARE CAPITAL

1,00,00,000 Equity Shares of face value of ₹10 each 1000.00

B. ISSUED, SUBSCRIBED AND PAID UP SHARE CAPITAL

60,00,000 fully paid up Equity Shares of face value of ₹10 each 600.00

C. PRESENT ISSUE IN TERMS OF DRAFT PROSPECTUS*

24,00,000 Equity Shares of face value of ₹10 each at a price of ₹51 per

Equity Share

240.00 1224.00

Which comprises of:


Equity Share reserved as Market Maker portion

12.00 61.20

Net Issue to Public of 22,80,000 Equity Shares of face value of ₹10 each at

a price of ₹51 per Equity Share to the Public

228.00 1162.80

Of the Net Issue to Public

Retail Portion:


Equity Share will be available for allocation to Investors up to ₹2.00 Lakhs

114.00 581.40

Non- Retail Portion:


Equity Share will be available for allocation to Investors above ₹ 2.00

Lakhs

114.00 581.40

D. ISSUED, SUBSCRIBED AND PAID UP SHARE CAPITAL AFTER

THE ISSUE

84,00,000 Equity Shares of face value of ₹10 each 840.00 -

E. SECURITIES PREMIUM ACCOUNT

Before the Issue Nil

After the Issue 984.00

*The Issue has been authorized pursuant to a resolution of our Board under section 179(3(c) & 62(1)(c) dated

May 25, 2018 and a Special Resolution passed under Section 23 and Section 62(1)(c) of the Companies Act,

2013 at an EGM of our shareholders held on June 8, 2018

Classes of Shares:

The Company has only one class of Share Capital i.e. Equity Shares of face value of ₹ 10 each only. All Equity

Shares issued are fully paid-up.

Our Company has no outstanding convertible instruments as on the date of this Prospectus.

History of change in Authorized Equity Share Capital of Our Company:

Sr.

No.

Particulars of Change Date of

Shareholders

Meeting

AGM/

EGM From To

1) ₹10,00,000 ( 1,00,000 Equity Shares of ₹10 each) On Incorporation -

2) 1,00,000 Equity Shares of ₹10

each

5,00,000 Equity Shares of ₹10

each July 22, 2005 EGM


each


each December 06, 2006 EGM


each


each July 17, 2007 EGM

64

5) 50,00,000 Equity Shares of ₹ 10

each

1,00,00,000 Equity Shares of ₹

10 each

March 20, 2018 EGM

NOTES TO THE CAPITAL STRUCTURE:

1) Equity Share Capital History:

Date of

Allotment of

Equity

Shares

No. of

Equity

Shares

Issued

Face

Value

(₹)

Issue

Price

(₹)

Nature of

Consideration

Nature of

allotment

Cumulative

No. of

Equity

Shares

Cumulative

paid-up

share

capital (₹)

Incorporation 10,000 10/- 10/- Cash Subscription

to MOA 10,000 1,00,000

26.08.2005 1,40,000 10/- 10/- Cash Further

Allotment 1,50,000 15,00,000

11.11.2006 26,000 10/- 10/- Cash Further

Allotment 1,76,000 17,60,000

04.01.2007 5,28,000 10/- - Other than

Cash

Bonus in the

ratio of 3:1 7,04,000 70,40,000

13.10.2008 46,000 10/- 10/- Cash Further

Allotment 7,50,000 75,00,000

24.12.2010 22,50,000 10/- - Other than

Cash

Bonus in the

ratio of 3:1 30,00,000 3,00,00,000

28.03.2018 30,00,000 10/- - Other than

Cash

Bonus in the

ratio of 1:1 60,00,000 6,00,00,000

(i.) Initial Subscribers to the Memorandum of Association of our Company:

Sr. No. Name of the Person No. of Shares Allotted

1) Jasbir Singh Kalra 5,000

2) Harpeet Singh 5,000

TOTAL 10,000

(ii.) Further Allotment of 1,40,000 Equity Shares:


1.) Jasbir Singh Kalra 20,000

2.) Harpreet Singh 20,000

3.) Sanjeev Kumar Singal 50,000

4.) Himjyoti Dhir 50,000

TOTAL 1,40,000

(iii.) Further Allotment of 26,000Equity Shares:


1) Satish Kumar 26,000

TOTAL 26,000

(iv.) Bonus Issue of 5,28,000 Equity Shares:


1) Harpreet 75,000

2) Sanjeev Kumar Singal 1,50,000

3) Himjyoti Dhir 1,50,000

4) Satish Kumar 78,000

5) Jasbir singh Kalra 75000

TOTAL 5,28,000

(v.) Further Allotment of 46,000 Equity Shares:


1.) Harpreet Singh 13,000

65


2.) Sanjeev Kumar Singal 13,000

3.) Himjyoti Dhir 13,000

4.) Satish Kumar 7000

TOTAL 46,000

(vi.) Bonus Issue of 22,50,000 Equity Shares:

Sr.

No. Name of the Person No. of Shares Allotted

1) Harpreet singh 3,39,000



4) Satish Kumar 3,33,000

5) Jasbir singh Kalra 3,00,000

TOTAL 22,50,000

(vii.) Bonus Issue of 30,00,000 Equity Shares:


1) Jasbir Singh Kalra 4,00,000

2) Harpreet Singh 4,52,000




6) Sanjay Dhir 4,00,000

7) Harjinder Kaur 10,000

TOTAL 30,00,000

2) Issue of Equity Shares for Consideration other than Cash:

Sr.

No.

Date of

Allotment

No of

Equity

Shares

Face

Value

(₹)

Issue

Price

(₹)

Consideration Nature of

Allotment

Benefits

accrued to

our

Company

1) 04.01.2007 5,28,000 10/- -

Other than

Cash

Bonus

Issue Nil

2) 24.12.2010 22,50,000 10/- -

Other than

Cash

Bonus

Issue Nil

3) 28.03.2018 30,00,000 10/- -

Other than

Cash

Bonus

Issue Nil

3) We have not issued any Equity Shares out of revaluation reserves or in terms of any scheme approved under

Sections 391- 394 of the Companies Act, 1956 and or Sections 230-233 of the Companies Act, 2013.

4) We have not issued any equity shares in last one year at price below the Issue Price immediately from the

date of filing of this Draft Prospectus except Bonus Shares.

5) Capital built-up of our Promoters:

A. Mr. Sanjeev Kumar Singal

Date of

Allotment Consideration

Nature of

the issue

No. of equity

shares

Face

Value

(₹)

Issue/

Acquisition/

Sale Price

(₹)

% of Pre-

Issue Paid

up Equity

capital

% of

Post

Issue

Paid up

Equity

capital

26.08.2005 Cash Further

Allotment 50,000 10 10 0.83% 0.60%

04.01.2007 Other than Bonus 1,50,000 10 - 2.50% 1.79%

66

Cash Issue

13.10.2008 Cash Futher

Allotment 13,000 10 10 0.22% 0.15%

24.12.2010 Other Than

Cash

Bonus

Issue 6,39,000 10 - 10.65% 7.61%

20.01.2018 Nil

Transfer of

Shares to

Harjinder

Kaur

(10,000) 10 10 -0.17% -0.12%


Cash

Bonus

Issue 8,42,000 10 - 14.03% 10.02%

Total 16,84,000 28.07% 20.05%

B. Mr. Harpreet Singh

Date of


Nature of the

issue

No. of

equity

shares

Face

Value

(₹)

Issue/

Acquisition/

Sale Price

(₹)

% of

Pre-

Issue

Paid up

Equity

capital

% of Post

Issue Paid

up Equity

capital

Inception Cash Subscriber to

Memorandum 5,000 10 10 0.08% 0.06%


Allotment 20,000 10 10 0.33% 0.24%


Cash Bonus Issue 75,000 10 - 1.25% 0.89%


Allotment 13,000 10 10 0.22% 0.15%


Cash Bonus Issue 3,39,000 10 - 5.65% 4.04%


Cash Bonus Issue 4,52,000 10 - 7.53% 5.38%

Total 9,04,000 15.07% 10.76%

C. Mr. Sanjay Dhir

Date of


Nature of

the issue

No. of

equity

shares

Face

Value

Issue/

Acquisition/

Sale Price

% of Pre-

Issue

Paid up

Equity

capital

% of Post

Issue Paid

up Equity

capital

01.08.2011 NIL

Transfer

From Ms.

Himjyoti

Dhir

4,00,000 10 - 6.67% 4.76%


Cash Bonus Issue 4,00,000 10 - 6.67% 4.76%

Total 8,00,000 13.33% 9.52%

D. Mr. Satish Kumar

Date of


Nature of

the issue

No. of

equity

shares

Face

Value

Issue/

Acquisition/

Sale Price

% of Pre-

Issue

Paid up

Equity

capital

% of Post

Issue Paid

up Equity

capital


Allotment 26,000 10 10 0.43% 0.31%


Cash Bonus Issue 78,000 10 - 1.30% 0.93%

67


Allotment 7,000 10 10 0.12% 0.08%


Cash Bonus Issue 3,33,000 10 - 5.55% 3.96%


Cash Bonus Issue 4,44,000 10 - 7.40% 5.29%

Total 8,88,000 14.80% 10.57%

Grand Total (A+B+C+D) 42,76,000 71.27% 50.90%

6) Details of Promoter’s Contribution locked in for three years:

Pursuant to Regulation 32 and 36 of SEBI (ICDR) Regulations an aggregate of 20.23% of the post-issue capital,

held by our Promoters shall be considered as Promoter’s Contribution (“Promoter’s Contribution”) and locked-

in for a period of three years from the date of allotment. The lock-in of the Promoter’s Contribution would be

created as per applicable law and procedure and details of the same shall also be provided to the Stock Exchange

before listing of the Equity Shares.

Our Promoter(s) Mr. Sanjeev Kumar Singal, Mr. Satish Kumar, Mr. Harpeet Singh and Mr. Sanjay Dhir have

granted their consent to include such number of Equity Shares held by them as may constitute 20.23% of the

post-issue Equity Share Capital of our Company as Promoter’s Contribution and have agreed not to sell or

transfer or pledge or otherwise dispose of in any manner, the Promoter’s Contribution from the date of filing of

this prospectus until the completion of the lock-in period specified above. The details of such equity shares are

as under:

Mr. Sanjeev Kumar Singal

Date of allotment Face

Value

Nature of

the issue

No. of

equity

shares

Issue Price

% of Pre-

Issue Paid

up Equity

capital

% of Post

Issue Paid

up Equity

capital

26.08.2005 10 Allotment 50,000 10 0.83% 0.59%

04.01.2007 10 Bonus Issue 1,50,000 - 2.5% 1.78%

13.10.2008 10 Allotment 3,000 10 0.05% 0.04%

24.12.2010 10 Bonus Issue 2,78,680 - 4.64% 3.32%

Total (A) 4,81,680 8.02% 5.73%

Mr. Satish Kumar


Value

Nature of

the issue

No. of

equity

shares

Issue Price

% of Pre-

Issue Paid

up Equity

capital

% of Post

Issue Paid

up Equity

capital

11.11.2006 10 Allotment 26,000 10 0.43% 0.30%

04.01.2007 10 Bonus Issue 78,000 Nil 1.3% 0.92%

13.10.2008 10 Allotment 7,000 10 0.12% 0.08%

24.12.2010 10 Bonus Issue 1,43,960 Nil 2.40% 1.71%

Total (B) 2,54,960 4.25% 3.01%

Mr. Harpeet Singh


Value

Nature of

the issue

No. of

equity

shares

Issue Price

% of Pre-

Issue Paid

up Equity

capital

% of Post

Issue Paid

up Equity

capital

10.02.2005 10 Allotment 5,000 10 0.08% 0.05%

26.08.2005 10 Allotment 20,000 10 0.33% 0.23%

04.01.2007 10 Bonus Issue 75,000 Nil 1.25% 0.89%

13.10.2008 10 Allotment 13,000 10 0.22% 0.16%

24.12.2010 10 Bonus Issue 3,39,000 10 5.65% 4.04%

28.03.2018 10 Bonus Issue 29,680 10 0.49% 0.35%

Total (C) 4,81,680 8.02% 5.73%

Mr. Sanjay Dhir


Value

Nature of

the issue

No. of

equity Issue Price

% of Pre-

Issue Paid

% of Post

Issue Paid

68

shares up Equity

capital

up Equity

capital

01.08.2011 10 Transfer by

Ms.

Himjyoti

Dhir

4,00,000 Nil 6.66% 4.76%

28.03.2018 10 Bonus Issue 81,680 Nil 1.36% 0.97%

Total (D) 4,81,680 8.02% 5.73%

Total

(A)+(B)+(C)+(D)

17,00,000 28.33% 20.23%

We further confirm that the aforesaid minimum Promoter’s Contribution of 20.23 % which is subject to lock-in

for three years does not consist of:

➢ Equity Shares acquired during the preceding three years for consideration other than cash and out of

revaluation of assets or capitalization of intangible assets or bonus shares out of revaluation reserves or

reserves without accrual of cash resources.

➢ Equity Shares acquired by the Promoters during the preceding one year, at a price lower than the price at

which Equity Shares are being offered to public in the Initial Public Offer. However, company has allotted

bonus shares.

➢ The Equity Shares held by the Promoters and offered for minimum Promoter’s Contribution are not subject

to any pledge.

➢ Equity Shares for which specific written consent has not been obtained from the shareholders for inclusion

of their subscription in the minimum Promoter’s Contribution subject to lock-in.

➢ Equity shares issued to our Promoters on conversion of partnership firm into Private limited company

during the preceding one year, at a price lower than the price at which Equity Shares are being offered to

public in the Initial Public Offer.

The Promoter’s Contribution can be pledged only with a scheduled commercial bank or public financial

institution as collateral security for loans granted by such banks or financial institutions, in the event the pledge

of the Equity Shares is one of the terms of the sanction of the loan. The Promoter’s Contribution may be pledged

only if in addition to the above stated, the loan has been granted by such banks or financial institutions for the

purpose of financing one or more of the objects of this Issue.

The Equity Shares held by our Promoters may be transferred to and among the Promoter Group or to new

Promoter or persons in control of our Company, subject to continuation of the lock-in in the hands of the

transferees for the remaining period and compliance with the Takeover Regulations, as applicable.

7) Details of share capital locked in for one year:

In addition to minimum 20.23% of the Post-Issue shareholding of our Company held by the Promoters (locked

in for three years as specified above), in accordance with regulation 36 of SEBI (ICDR) Regulations, the entire

pre-issue share capital of our Company shall be locked in for a period of one year from the date of Allotment in

this Issue.

The Equity Shares held by persons other than our Promoters and locked-in for a period of one year from the date

of Allotment, in accordance with regulation 37 of SEBI (ICDR) Regulations, in the Issue may be transferred to

any other person holding Equity Shares which are locked-in, subject to the continuation of the lock-in in the

hands of transferees for the remaining period and compliance with the Takeover Regulations.

Our Promoters have confirmed to the Company and the Lead Manager that the Equity Shares held by our

Promoters have been financed from their personal funds or their internal accruals, as the case may be, and no

loans or financial assistance from any bank or financial institution has been availed by them for this purpose.

There are no financing arrangements whereby the Promoter Group, the Directors of our Company and their

relatives have financed the purchase by any other person of securities of the issuer other than in the normal

course of the business of the financing entity during the period of six months immediately preceding the date of

filing offer document with the Stock Exchange.

69

8) Shareholding pattern of our company:

` The table below represents the current Shareholding pattern of our Company as per Regulation 31 of the SEBI (LODR) Regulations, 2015:

Cate

gory

(I)

Category

of

shareholde

r

(II)

Nos.

of

Shar

ehol

ders

(III)

No. of

fully

paid up

equity

shares

held (IV)

No. of

Partly

Paid

up

equity

shares

held

(V)

No. of

shares

underl

ying

Deposi

tory

Receip

ts (VI)

Total nos.

Shares

held (VII)

=(IV) +(V)

+(VI)

Shareholdi

ng as a %

of total No

of Shares

(calculate

as per

SCRR,

1957) As a

% of

(A+B+C2)

(VIII)

Shareholding as a % of total no.

of shares (calculated as per SCRR,

1957) As a % of (A+B+C) (IX) No. of

Shares

Under

lying

Outsta

nding

conver

tible

securit

ies

(inclu

ding

Warra

nts)

(X)

Shareholdi

ng

as a %

assuming

full

conversion

of

convertible

securities

(as a % of

diluted

share

capital) As

a % of

(A+B+C2)

(XI) =

(VII)

+ (X)

Number of

Locked in Shares

(XII)

Number of

Shares

pledged or

otherwise

encumbered

(XIII)

Numb

er of

equity

shares

held in

demat

erializ

ed

form

(XIV)

No of Voting Rights

Total

(XIV)

as a

% of

(A+B

+ C)

Class:

Equity

Class

:

prefe

rence

Total No.

(a)

As a

% of

total

Share

s

held

(b)

No.

(a)

As a

% of

total

Share

s

Held

(b)

(A) Promoter 4 42,76,000 - - 42,76,000 71.27% 42,76,000 - 42,76,000 71.27% - 71.27% - - - - -

(B) Promoter

Group

3 17,24,000 - - 17,24,000 28.73% 17,24,000 - 17,24,000 28.73% - 28.73% - - - - -

(B) Public - - - - - - - - - - - - - - - - -

(D) Non-

Promoter/ Non-

Public

- - +- - - - - - - - - - - - - - -

(D1) Shares

underlying D₹

- - - - - - - - - - - - - - - - -

(D2) Shares

held by Employee

Trusts

- - - - - - - - - - - - - - - - -

Total 7 60,00,000 - - 60,00,000 100.00% 60,00,000 - 60,00,000 100.00% - 100.00% - - - - -

Notes:

(i) The term “Encumbrance” has the same meaning as assigned under regulation 28(3) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations,

2011.

(ii) Our Company will file the shareholding pattern of our Company in the form prescribed under Regulation 31 of SEBI (LODR) Regulations, one day prior to

the listing of the Equity Shares. The shareholding pattern will be uploaded on the website of NSE before commencement of trading of our Equity Shares.

(iii) There are no Equity Shares against which depository receipts have been issued.

(iv) Other than the Equity Shares, there is no other class of securities issued by our Company.

70

A. Shareholding Pattern of Promoters and Promoter Group:

Sr.

No.

Name of the

Shareholder

Pre-Issue Post-Issue Shares pledged or otherwise

encumbered

No. of

Equity

Shares

As a %

of

Issued

Share

Capital

No. of

equity

shares

As a % of

Issued

Share

Capital

Numbe

r

As a

%

As a % of

grand total

(a)+(b)+ (c)

of Sub-

clause (i)(a)

Promoters:

1) Sanjeev Kumar

Singal

16,84,000

28.07%

16,84,000 20.05%

Nil Nil N.A.

2) Harpreet Singh 9,04,000 15.07% 9,04,000 10.76% Nil Nil N.A.

3) Sanjay Dhir 8,00,000

13.33%

8,00,000 9.52%

Nil Nil N.A.


14.80%

8,88,000 10.57%

Nil Nil N.A.

Promoter

Group:

5) Himjyoti Dhir 9,04,000 15.07% 9,04,000 10.77% Nil Nil N.A.

6) Jasbir Kalra 8,00,000 13.33% 8,00,000 9.52% Nil Nil N.A.

7) Harjinder Kaur 20,000 0.33% 20,000 0.23% Nil Nil N.A.

Total 60,00,000 100% 60,00,000 71.42% Nil Nil N.A.

B. Shareholding Pattern of the persons belonging to the category “Public”:

There are no Public Shareholders in the Company as on date.

C. There has been no purchase no sell of Equity Shares by the promoters and promoter Group, and our Directors

during a period of six months preceding the date on which this Draft Prospectus is filed with NSE except as

forth below:-

Date of

Transfer

Name of

Transfror

Name of

Transfree

No. of

Shares

Pric

e

Nature of

Transectio

n

Nature of

Consideration

January 20,

2018

Sanjeev

Kumar Singal

Harjinder

Kaur

10,000 - Gift Nil

9) The average cost of acquisition of or subscription to Equity Shares by our Promoters is set forth in the

table below:

Sr. No. Name of the Promoters No of Shares held Average cost of Acquisition (in ₹)

1) Sanjeev Kumar Singal 16,84,000 0.37

2) Harpreet Singh 9,04,000 0.42

3) Sanjay Dhir 8,00,000 0.00

4) Satish Kumar 8,88,000 0.37

10) None of our Directors or Key Managerial Personnel hold equity shares in our company, other than as stated

above.

11) Equity Shares held by top ten shareholders:

A. Our Company has only Seven Shareholders and the number of Equity Shares held by them as on date of this

Draft Prospectus are as under:

71

Sr. No. Name of the shareholders No. of Shares % age of pre-Issue capital

1) Sanjeev Kumar Singal 16,84,000 28.07%

2) Harpreet Singh 9,04,000 15.07%

3) Sanjay Dhir 8,00,000 13.33%

4) Satish Kumar 8,88,000 14.80%

5) Himjyoti Dhir 9,04,000 15.07%

6) Jasbir Singh Kalra 8,00,000 13.33%

7) Harjinder Kaur 20,000 0.33%

Total 60,00,000 100.00%

B. Our Company has only Seven Shareholders and the number of Equity Shares held by them as on Ten days prior

to this Draft Prospectus are as under:



2) Harpeet Singh 9,04,000 15.07%

3) Sanjay Dhir 8,00,000 13.33%

4) Satish Kumar 8,88,000 14.80%

5) Himjyoti 9,04,000 15.07%


7) Harjinder Kaur 20,000 0.33%

Total 60,00,000 100.00%

C. Our Company has only Six Shareholders and the number of Equity Shares held by them as on Two years prior

to this Prospectus are as under:



2) Harpreet Singh 4,52,000 15.07%


4) Him Jyoti 4,52,000 15.07%

5) Satish Kumar 4,44,000 14.80%

6) Sanjay Dhir 4,00,000 13.33%

Total 30,00,000 100.00%

12) There is no "Buyback", "Standby", or similar arrangement for the purchase of Equity Shares by our

Company/Promoters/Directors/Lead Manager for purchase of Equity Shares offered through this Prospectus.

13) The Equity Shares, which are subject to lock-in, shall carry the inscription “non-transferable” and the non-

transferability details shall be informed to the depository. The details of lock-in shall also be provided to the

Stock Exchange before the listing of the Equity Shares.

14) As on the date of this Draft Prospectus, none of the shares held by our Promoters/ Promoter Group are pledged

with any financial institutions or banks or any third party as security for repayment of loans.

15) We have not raised any bridge loans against the proceeds of the Issue.

16) Investors may note that in case of over-subscription, allotment will be on proportionate basis as detailed in

heading on "Issue structure" beginning on Page No.244 of this Draft Prospectus.

17) The Equity Shares Issued pursuant to this Issue shall be fully paid-up at the time of Allotment, failing which no

allotment shall be made.

18) Our Company has not issued any Equity Shares at a price less than the Issue Price in the last one year preceding

the date of filing of this Prospectus except Bonus Shares.

19) In case of over-subscription in all categories the allocation in the Issue shall be as per the requirements of

Regulation 43 (4) of SEBI (ICDR) Regulations, as amended from time to time.

20) Under subscription, if any, in any category, shall be met with spill-over from any other category or combination

of categories at the discretion of our Company, in consultation with the Lead Manager and the designated stock

exchange.

72

21) An over-subscription to the extent of 10% of the Issue can be retained for the purpose of rounding off while

finalizing the basis of allotment to the nearest integer during finalizing the allotment, subject to minimum

allotment lot. Consequently, the actual allotment may go up by a maximum of 10% of the Issue, as a result of

which, the post issue paid up capital after the Issue would also increase by the excess amount of allotment so

made. In such an event, the Equity Shares held by the Promoters and subject to lock-in shall be suitably

increased to ensure that 20% of the post issue paid-up capital is locked-in.

22) The Issue is being made through Fixed Price Method.

23) As on date of filing of this Prospectus with Stock Exchange, the entire issued share capital of our Company is

fully paid-up. The Equity Shares offered through this Public Issue will be fully paid up.

24) On the date of filing of this Prospectus with Stock Exchange, there are no outstanding financial instruments or

any other rights that would entitle the existing Promoters or shareholders or any other person any option to

receive Equity Shares after the Issue.

25) Our Company has not issued any Equity Shares out of revaluation reserves and not issued any bonus shares out

of capitalization of revaluation reserves.

26) Lead Manager to the Issue viz. Mark Corporate Advisors Private Limited and its associates do not hold any

Equity Shares of our Company.

27) Our Company has not revalued its assets since incorporation.

28) Our Company has not made any Public Issue of any kind or class of securities since its incorporation.

29) There will be only one denomination of the Equity Shares of our Company unless otherwise permitted by law.

30) Our Company shall comply with such disclosure, and accounting norms as may be specified by SEBI from time

to time.

31) There will be no further issue of capital whether by way of issue of bonus shares, preferential allotment, and

rights issue or in any other manner during the period commencing from submission of this Prospectus with

Stock Exchange until the Equity Shares to be issued pursuant to the Issue have been listed.

32) Except as disclosed in this Prospectus, our Company presently does not have any intention or proposal to alter

its capital structure for a period of six (6) months from the date of opening of the Issue, by way of

spilt/consolidation of the denomination of Equity Shares or further issue of Equity Shares (including issue of

securities convertible into Equity Shares) whether preferential or otherwise. However, during such period or a

later date, it may issue Equity Shares or securities linked to Equity Shares to finance an acquisition, merger or

joint venture or for regulatory compliance or such other scheme of arrangement if an opportunity of such nature

is determined by its Board of Directors to be in the interest of our Company.

33) Our Company does not have any ESOS/ESPS scheme for our employees and we do not intend to allot any

shares to our employees under ESOS/ESPS scheme from the proposed Issue. As and when, options are granted

to our employees under the ESOP scheme, our Company shall comply with the SEBI (Employee Stock Option

Scheme and Employees Stock Purchase Plan) Guidelines 1999.

34) An investor cannot make an application for more than the number of Equity Shares offered in this Issue, subject

to the maximum limit of investment prescribed under relevant laws applicable to each category of investor.

35) No payment, direct, indirect in the nature of discount, commission, and allowance, or otherwise shall be made

either by us or by our Promoters to the persons who receive allotments, if any, in this Issue.

36) Our Company has seven (7) Shareholders as on the date of filing of this Draft Prospectus.

73

SECTION - IV

OBJECTS OF THE ISSUE

The Objects of the Issue are to finance our business expansion plans and achieve the benefits of listing on the SME

platform of NSE. We believe that listing will enhance our corporate image and brand name of our Company.

The Objects of the Issue are as stated below:

1.) To meet Working Capital Requirements

2.) Repayment/Pre-payment of Term Loan

3.) General Corporate Purposes

We believe that the listing of our Equity Shares will enhance our visibility and brand name and enable us to avail of

future growth opportunities.

The main Object Clause of our Memorandum of Association permits us to undertake our existing activities and the

activities for which the funds are being raised by us, through the present Issue. The fund requirement and

deployment is based on internal management estimates and has not been appraised by any bank or financial

institution.

The details of the proceeds of the Issue are summarized in the table below:

Requirements of Funds:

The Funds required are proposed to be used in accordance with the details provided in the following table:

(₹ in Lakhs)

Sr. No. Particulars Amount

1) To meet Working Capital requirements 545.00

2) Repayment/Pre-payment of Term Loan 300.00

3) To meet General Corporate Purposes 250.00

Total Funds Required 1095.00

Means of Finance:

The above mentioned fund requirement are to be financed as shown below:

(in Lakhs)

Sr. No. Particulars Amount

1) Gross Proceeds from the Issue 1224.00

Less: Issue Expenses 129.00

Net Proceeds from the Issue 1095.00

Since the entire fund requirement are to be funded from the proceeds of the Issue, there is no requirement to make

firm arrangements of finance under Regulation 4(2) (g) of the SEBI ICDR Regulations through verifiable means

towards at least 75% of the stated means of finance, excluding the amounts to be raised through the proposed Issue.

The fund requirement and deployment is based on internal management estimates and have not been appraised by

any bank or financial institution. These are based on current conditions and are subject to change in the light of

changes in external circumstances or costs or other financial conditions and other external factors.

In case of any increase in the actual utilization of funds earmarked for the Objects, such additional funds for a

particular activity will be met by way of means available to our Company, including from internal accruals. If the

actual utilization towards any of the Objects is lower than the proposed deployment such balance will be used for

future growth opportunities including funding existing objects, if required. In case of delays in raising funds from

the Issue, our Company may deploy certain amounts towards any of the above mentioned Objects through a

combination of Internal Accruals or Unsecured Loans (Bridge Financing) and in such case the Funds raised shall be

74

utilized towards repayment of such Unsecured Loans or recouping of Internal Accruals. However, we confirm that

no bridge financing has been availed as on date, which is subject to being repaid from the Issue Proceeds.

We further confirm that no part proceed of the Issue shall be utilized for repayment of any Part of unsecured loan

outstanding as on date of draft Prospectus.

As we operate in competitive environment, our Company may have to revise its business plan from time to time and

consequently our fund requirements may also change. Our Company‘s historical expenditure may not be reflective

of our future expenditure plans. Our Company may have to revise its estimated costs, fund allocation and fund

requirements owing to various factors such as economic and business conditions, increased competition and other

external factors which may not be within the control of our management. This may entail rescheduling or revising

the planned expenditure and funding requirements, including the expenditure for a particular purpose at the

discretion of the Company‘s management.

For further details on the risks involved in our business plans and executing our business strategies, please see the

section titled ‘Risk Factors’ beginning on page no 15 of the draft Prospectus.

Details of Utilization of Gross Proceeds from the Issue:

The details of utilization of the gross Proceeds are set forth herein below:

1.) To meet the Working Capital Requirements:

We Fund the majority of our working capital requirements in the ordinary course of our business from our internal

accruals, net worth, secured & Unsecured Loans and financing from bank. As on March 31, 2017 and March 31,

2018, the amount outstanding on our company fund based working capital facility was Rs. 1111.93 and 894.53

respectively as per the restated Financial Statement.

Sr.

No. Particulars

As on March 31,

2017 2018 2019

Actual

(Restated)

Actual

(Restated)

Estimate

d

D. Current Assets

Trade Receivables 2441.14 1988.62 2259.00

Inventories 541.19 727.55 888.00

Short Term Loans and Advances 9.25 213.32 198.00

Cash and cash equivalents 278.10 295.47 214.00

Total (A) 3269.68 3224.96 3559.00

E. Current Liabilities

Trade Payables 1716.80 2049.30 1830.00

Other Current Liabilities and Short Term Provisions 440.96 281.12 290.00

Total (B) 2157.76 2330.42 2120.00

F. Net Working Capital (A)-(B) 1111.92 894.54 1439.00

G. Working Capital Gap 544.46

Rounded Off 545.00

Basis of Estimation:

Sr. No. Particulars Remark

1) Debtors We expect Debtors Holding days to be at 120 days for FY 2018-19 which is same as of

F.Y. 2017-18

2) Inventory We expect Inventory Holding days to be at 60 days which is more or less same as of

F.Y.2017-18

3) Creditors We expect Creditors payments days to be 130 days due to reduction in credit period.

75

Sr. No. Particulars Remark

The same

2.) Repayment/Pre-payment of Term Loan

Our Company has been sanctioned Cash Credit facility of ₹ 700.00 Lakhs from HDFC Bank through its Sanction

letter dated May 10, 2018. Our Company proposes to utilize an aggregate amount of ₹ 300.00 lacs from the Net

Proceeds towards repayment/pre-payment of Term Loan facility availed by our Company.

We believe that such repayment or prepayment will help reduce our outstanding indebtedness and debt servicing

costs and enable utilization of the internal accruals for further investment in business growth and expansion. In

addition, we believe that the leverage capacity of our Company will improve our ability to raise further resources

in the future to fund potential business development opportunities and plans to grow our business in the future.

The following table provides details of the amounts drawn down under the Cash Credit facility and Working

Capital Demand Loan (WCDL) facility (part of Cash Credit facility) availed by our Company from HDFC Bank

Limited and proposed to be repaid or prepaid from the Net Proceeds:

Name of

Lender

Amount

Outstanding

as on October

31,2018

Rate of

Interest

Security Tenure Total (₹ in Lacs)

HDFC

Bank

201.56 10.05% Hypothecation of stock of

Raw material, stock in

progress, stock in transit,

finished goods and

products at unit/godown

or other places including

goods in transit and

receivables.

60 Months 200.00

HDFC

Bank

119.55 9.40% Personal Guarentee of all

Directors and Property

Owner

60 Months 100.00

TOTAL 300.00

3.) General Corporate Purposes

Our Company proposes to deploy the balance Net Proceeds aggregating to ₹ 250.00 Lakhs towards general

corporate purposes, subject to such utilization not exceeding 25% of the Net Proceeds, in compliance with the SEBI

Regulations. The general corporate purposes for which our Company proposes to utilise Net Proceeds include

meeting exigencies faced, and expenses incurred, by our Company in the ordinary course of business. In addition to

the above, our Company may utilise the Net Proceeds towards other expenditure (in the ordinary course of business)

considered expedient and as approved periodically by the Board or a duly constituted committee thereof. Our

Company’s management, in accordance with the policies of the Board, shall have flexibility in utilizing surplus

amounts, if any

4.) Issue Expenses

The total expenses of the Issue are estimated to be approximately ₹. 129.00 Lakhs. The Issue expenses consist of

underwriting fees, selling commission, fees payable to the Lead Manager, legal counsel, Bankers to the Issue

including processing fee to the SCSBs for processing ASBA Application Forms procured by the Syndicate Members

and submitted to the SCSBs and Registrar to the Issue, printing and stationery expenses, advertising and marketing

expenses and all other incidental and miscellaneous expenses for listing the Equity Shares on the Stock Exchange.

The break-up for the Issue expenses is as follows:

76

Activity

Estimated

Expenses (₹ in

Lakhs)

As a % of the total

estimated Issue

expenses

As a % of the

total

Issue size

Payment to Merchant Banker including

Underwriter Commission expenses towards

printing, advertising, and payment to other

intermediaries such as Legal Advisors,

Registrars, Bankers, etc.

[•] [•] [•]

Regulatory Fees [•] [•] [•]

Marketing and Other Selling Expenses [•] [•] [•]

Total Estimated Issue Expenses 129.00 [•] [•]

Selling commission payable to registered broker, SCSBs, RTAs, CDPs on the portion directly procured from Retail

Individual Applicants and Non Institutional Applicants, would be 0.05% on the Allotment Amount or ₹ 10 whichever

less on the Applications wherein shares are allotted is.

Our fund requirements and deployment thereof are based on the estimates of our management. These are based on

current circumstances of our business and are subject to change in light of changes in external circumstances or

costs or in our financial condition, business or strategy. Our management, in response to the dynamic nature of the

industry, will have the discretion to revise its business plan from time to time and consequently our funding

requirement and deployment of funds may also change. This may also include rescheduling the proposed utilization

of Proceeds and increasing or decreasing expenditure for a particular object vis-à-vis the utilization of Proceeds. In

case of a shortfall in the Net Proceeds, our management may explore a range of options which include utilisation of

our internal accruals, debt or equity financing. Our management expects that such alternate arrangements would be

available to fund any such shortfall.

Proposed Schedule of Implementation:

(₹ in Lakhs)

Sr.

No. Particulars

Schedule Of Utilization

Already

incurred

FY 2018-19 FY 2019-20 Total

1.) To meet Working Capital Requirements - 545.00 - 545.00

2.) Repayment/Pre-payment of Term Loan 300.00 - 300.00

3.) General Corporate Purposes - - 250.00 250.00

Gross Total - 845.00 250.00 1095.00

Details of funds already Deployed till date and Sources of Funds deployed

The Funds deployed upto July 31, 2018 is ₹ 6.27 Lakhs which is towards Issue Expenses as certified by the auditor

of the Company, M/s Vijay Darji &Associates, Chartered Accountants vide certificate dated August 13, 2018. The

said amount has been met by the Company from its Internal sources and the same will be adjusted against the issue

proceeds.

77

BASIC TERMS OF THE ISSUE

The Equity Shares, now being issued, are subject to the terms and conditions of this Draft Prospectus, Application

form, Confirmation of Allocation Note (CAN), the Memorandum and Articles of Association of our Company, the

guidelines for listing of securities issued by the Government of India and SEBI (ICDR) Regulations, 2009, the

Depositories Act, Stock Exchange, RBI, ROC and/or other authorities as in force on the date of the Issue and to the

extent applicable. In addition, the Equity Shares shall also be subject to such other conditions as may be

incorporated in the Share Certificates, as per the SEBI (ICDR) Regulations, 2009 notifications and other regulations

for the issue of capital and listing of securities laid down from time to time by the Government of India and/or other

authorities and other documents that maybe executed in respect of the Equity Shares. This Issue has been authorized

by the Board of Directors pursuant to a Board Resolution dated May 25, 2018 and by the Shareholders of our

Company pursuant to a special resolution dated June 08, 2018 passed at the EGM of Shareholders under Section 62

(1)(c) of the Companies Act, 2013.

Face Value : Equity Share shall have the face value of `10.00 each

Issue Price : Equity Share is being issued at a price of `51 each and is at 5.1 times of Face Value

Market Lot &

Trading Lot

: The Market lot and Trading lot for the Equity Share is 2,000 and the multiple of 2,000,

subject to a minimum allotment of 2,000 Equity Shares to the successful applicants.

Terms of

Payment

: 100% of the issue price of `51 each shall be payable on Application. For more details please

refer “Issue Procedure” on page no 246 of this Draft Prospectus

Ranking of

the Equity

Shares

: The Equity Shares shall be subject to the Memorandum and Articles of Association of the

Company and shall rank pari-passu in all respects including dividends with the existing

Equity Shares of the Company. The Allottees in receipt of Allotment of Equity Shares under

this Issue will be entitled to dividends and other corporate benefits, if any, declared by the

Company after the date of Allotment. For further details, please see “Main Provisions of

Articles of Association” on [•] of this Draft Prospectus

Minimum Subscription

This Issue is not restricted to any minimum subscription level. This Issue is 100% underwritten. If the Issuer does

not receive the subscription of 100% of the Issue through this offer document including devolvement of

Underwriters within sixty days from the date of closure of the Issue, the Issuer shall forthwith refund the entire

subscription amount received. If there is a delay beyond prescribed time after the Issuer becomes liable to pay the

amount, the Issuer shall pay interest prescribed under section 40 of the Companies Act, 2013.

For further details, please refer to section titled "Terms of the Issue" beginning on page no 238 of this Draft

Prospectus.

78

BASIS FOR ISSUE PRICE

The Issue Price of ₹51 per Equity Share has been determined by our Company, in consultation with the Lead

Manager on the basis of the following qualitative and quantitative factors as described below. The face value of the

Equity Share is ₹10 and Issue Price is ₹51 per Equity Share i.e. 5.1 times of the face value.

Qualitative Factors

Some of the qualitative factors, which form the basis for computing the price, are:

1) Track Record of the Company

2) Stringent quality control

3) Leveraging the experience of our Promoters

4) Experienced management team and a motivated and efficient work force

5) Scalable Business Model

For further details, refer sections entitled “Risk Factors”, “Our Business”, and “Financial Statements” on page

nos.15, 93 and 151,respectively, to make an informed investment decision.

Quantitative Factors

The information presented below relating to the Company is based on the Restated Financial Statements of the

Company for Financial Year 2017-2018, 2016-2017 and 2015-2016 prepared in accordance with Indian GAAP and

the Companies Act and restated in accordance with the SEBI Regulations. Some of the quantitative factors, which

form the basis for computing the price, are as follows:

1) Basic and Diluted Earnings per Share (EPS):

As per Restated Standalone Financial Statement

Year Ended Basic and Diluted EPS Weight

March 31, 2016 0.90 1

March 31, 2017 3.16 2

March 31, 2018 3.04 3

Weighted Average 2.72 6

As per restated Consolidated Financial Statement

Year Ended Basic and Diluted EPS Weight

March 31, 2016 3.31 1

March 31, 2017 5.66 2

March 31, 2018 5.05 3

Weighted Average 4.96 6

Note:

(i) Basic EPS (₹) has been calculated by dividing the Net Profit as restated by Restated Weighted Average

number of Equity Shares outstanding during the year.

(ii) Diluted EPS (₹) has been calculated by dividing the Net Profit as restated by Restated Weighted Average

number of Equity Shares outstanding at the end of the year.

(iii) The face value of each Equity Share is ₹10

2) Price to Earnings (P/E) ratio in relation to Issue Price of ₹ 51 per Equity Share of face value of ₹ 10 each:

Particulars P/E Ratio

Based on basic/Diluted EPS, as restated for FY 2017-18 on a standalone basis 3.04

79

Based on diluted EPS, as restated for FY 2017-18 on consolidated basis 5.05

Industry P/E*

Highest 206.30

Lowest 8.40

Industry Average 47.40

* Source: Capital Market (Magazine), Issue: August 13-26, 2018

3) Return on Net worth (RoNW) for the preceding three years:

As per Restated Standalone Financial Statement

Year Ended RoNW (%) Weight

March 31, 2018 8.87% 1

March 31, 2017 5.17% 2

March 31, 2016 1.53% 3

Weighted Average 3.96% 6

Note: (i) The RoNW has been computed by dividing net profit after tax as restated, by Net Worth as at the end of the

year excluding miscellaneous expenditure to the extent not written off.

As per Restated Consolidated Financial Statements

Year Ended RoNW (%) Weight

March 31, 2018 12.79% 1

March 31, 2017 8.24% 2

March 31, 2016 5.15% 3

Weighted Average 7.45% 6

4) Net Asset Value (NAV):

Particulars Amount (₹)

Net Asset Value per Equity Share as of March 31, 2018 34.25

Net Asset Value per Equity Share after the Issue 29.03

Issue Price per equity share 51.00

Note: NAV per Equity Share has been calculated as Net Worth as divided by number of Equity Shares.

5) Comparison with other Listed Companies/Industry Peers:

Companies Face Value (₹) RoNW (%) EPS (₹)

(as on March 31, 2017) P/E Ratio

BDH Inds. 10 12.4% 5.5 12.91

Jenburkt

Pharma

10 28.7% 37.5 19.97

Makers Labs. 10 10.6% 6.2 12.95

Preet Remedies

Limited

10 8.87% 3.04 16.77

*(Source: Audited Financial Results for the year ending March 31, 2018 as available on capital market July

02-15, 2018 and for calculating P/E ratio and Market Price as on Augest 8, 2018 is considered)

Note:

(i) The figures of Our Company are based on the restated Standalone financial statements for the Financial

Year ended March 31, 2018.

(ii) The figures for the Peer group are based on Standalone Audited Results for the Financial Year ended

March 31, 2018.

80

6) The Company in consultation with the Lead Manager believes that the issue price of ₹ 51 per Equity Share for

the Public Issue is justified in view of the above parameters. The investors may also want to peruse the “Risk

Factors” beginning on page 15 of this Prospectus and Financials of the company as set out in the “Financial

Statements” beginning on page no 151 of this Prospectus to have more informed view about the investment

proposition. The Face Value of the Equity Shares is ₹10 per Equity Share and the Issue Price is 5.1 times of the

face value i.e. ₹ 10 per Equity Share.

81

STATEMENT OF TAX BENEFITS

Statement of possible special tax benefits available to the company and its shareholders

To

The Board of Directors,

Preet Remedies Limited

(Formerly known as Preet Remedies Pvt Ltd)

Plot No.183-186, HPSIDC, Industrial Area, Baddi, (HP)-173205

We refer to proposed issue of the shares of Preet Remedies Limited,,formerly known as Preet Remedies Pvt Ltd. (‘the Company’). We enclose herewith the statement showing the possible tax benefits

available to the Company and the shareholders of the Company under the Income - Tax Act, 1961 (‘Act’), as

applicable to the assessment year 2019-20 relevant to the financial year 2018-19 for inclusion in the Draft

Prospectus (“Draft Offer Document”) for the proposed issue of shares.

Several of these benefits are dependent on the Company or its shareholders fulfilling the conditions

prescribed under the relevant provisions of the Income-tax Act 1961. Hence, the ability of the Company

or its shareholders to derive these direct tax benefits is dependent upon their fulfilling such conditions,

which is based on the business imperatives, the company or its shareholders may or may not choose to

fulfill.

The benefits discussed in the enclosed statement are neither exhaustive nor conclusive. The contents

stated in the Annexure are based on the information and explanations obtained from the Company. This

statement is only intended to provide general information to guide the investors and is neither designed

nor intended to be a substitute for professional tax advice. In view of the individual nature of the tax

consequences and the changing tax laws, each investor is advised to consult their own tax consultant with

respect to specific tax implications arising out of participation in the issue. We are neither suggesting nor

are we advising the investor to invest money or not to invest money based on this statement.

We do not express any opinion or provide any assurance as to whether:

the Company or its shareholders will continue to obtain these benefits in future; the conditions prescribed for availing the benefits, where applicable have been/would be met; the revenue authorizes/courts will concur with the views expressed herein.

For Vijay Darji & Associates Chartered Accountants

F.R.N. 118614W

Vijay Darji

Proprietor M.No. 105197

Place: Mumbai

Date: 27 July 2018

82

ANNEXURE TO THE STATEMENT OF POSSIBLE SPECIAL TAX BENEFITS AVAILABLE TO

Preet Remedies Limited (“THE COMPANY”) AND ITS SHAREHOLDERS UNDER THE

APPLICABLE TAX LAWS IN INDIA

Outlined below are the possible Special tax benefits available to the Company and its shareholders under the

direct tax laws in force in India. These benefits are dependent on the Company or its shareholders fulfilling the

conditions prescribed under the relevant tax laws. Hence, the ability of the Company or its shareholders to

derive the special tax benefits is dependent upon fulfilling such conditions, which based on business

imperatives it faces in the future, it may not choose to fulfill.

1. Special Tax Benefits available to the Company

Tax Benefit under section 80-IC of income tax Act 1961:- The company is enjoying the income tax

benefit which is 30% of net profit under section 80-IC of the income tax Act’1961 since the undertaking or

enterprise in located in Baddi (HP) as notified by the board for the purpose of section 80-IC and the

undertaking or enterprise manufacture or produce article or thing specified in the fourteenth schedule.

Further the company has claimed the said tax benefit from Assessment year 2010-2011 and the benefits

will be available till Assessment year 2019-2020.

2. Special Tax Benefits available to the shareholders of the Company

There are no Special tax benefits available to the shareholders of the Company.

Notes:

All the above benefits are as per the current tax laws and any change or amendment in the laws/regulations,

which when implemented would impact the same.

For Vijay Darji & Associates Chartered Accountants

F.R.N. 118614W

Vijay Darji

Proprietor M.No. 105197

Place: Mumbai

Date: 27 July 2018

83

SECTION V - ABOUT OUR COMPANY

OUR INDUSTRY

The information contained in this section is derived from publicly available sources. Neither we, nor any other

person connected with the Issue has independently verified this information. Industry sources and publications

generally state that the information contained therein has been obtained from sources generally believed to be

reliable, but that their accuracy, completeness and underlying assumptions are not guaranteed and their reliability

cannot be assured. Industry publications are also prepared based on information as of specific dates and may no

longer be current or reflect current trends.

Investors should note that this is only a summary of the industry in which we operate and does not contain all

information that should be considered before investing in the Equity Shares. Before deciding to invest in the Equity

Shares, prospective investors should read this entire Prospectus, including the information in the sections "Risk

Factors" and "Financial Information" on pages 15 and 151 respectively. An investment in the Equity Shares

involves a high degree of risk. For a discussion of certain risks in connection with an investment in the Equity

Shares, please see the section ‘Risk Factors’ on page 15.

INDIAN ECONOMY OVERLOOK

India has emerged as the fastest growing major economy in the world as per the Central Statistics Organisation

(CSO) and International Monetary Fund (IMF) and it is expected to be one of the top three economic powers of the

world over the next 10-15 years, backed by its strong democracy and partnerships. India’s GDP is estimated to have

increased 6.6 per cent in 2017-18 and is expected to grow 7.3 per cent in 2018-19.

India's gross domestic product (GDP) at constant prices grew by 7.2 per cent in September-December 2017 quarter

as per the Central Statistics Organisation (CSO). Corporate earnings in India are expected to grow by 15-20 per cent

in FY 2018-19 supported by recovery in capital expenditure, according to JM Financial. The tax collection figures

between April 2017 - February 2018 show an increase in net direct taxes by 19.5 per cent year-on-year and an

increase in net direct taxes by 22.2 per cent year-on-year.

India has retained its position as the third largest startup base in the world with over 4,750 technology startups, with

about 1,400 new start-ups being founded in 2016, according to a report by NASSCOM. India's labour force is

expected to touch 160-170 million by 2020, based on rate of population growth, increased labour force participation,

and higher education enrolment, among other factors, according to a study by ASSOCHAM and Thought Arbitrage

Research Institute. India's foreign exchange reserves were US$ 422.53 billion in the week up to March 23, 2018,

according to data from the RBI. India's gross domestic product (GDP) is expected to reach US$ 6 trillion by FY27

and achieve upper-middle income status on the back of digitisation, globalisation, favorable demographics, and

reforms.

India is expected to be the third largest consumer economy as its consumption may triple to US$ 4 trillion by 2025,

owing to shift in consumer behavior and expenditure pattern, according to a Boston Consulting Group (BCG) report;

and is estimated to surpass USA to become the second largest economy in terms of purchasing power parity (PPP)

by the year 2040, according to a report by PricewaterhouseCoopers

(Sources: https://www.ibef.org/economy/indian-economy-overview)

INTRODUCTION TO THE INDIAN PHARMACEUTICAL INDUSTRY

The Indian pharmaceutical industry has contributed immensely not just to Indian but to global healthcare outcomes.

India continues to play a material role in manufacturing various critical, high‐ quality and low‐cost medicines for

Indian and global markets. It supplies 50 to 60 percent of global demand for many vaccines (including ARVs), 40

percent of generics consumed in the US and 25 percent of all the medicines dispensed in the UK1. Over the last 5

years, 35 to 38 percent of total ANDAs approved (including 25 to 30 percent of total injectable ANDAs) have been

filed from Indian sites2. Affordable anti‐retroviral (ARV) drugs from India were a major factor in AIDS patients

84

getting greater access to treatment. India supplies 60 percent of global ARV drugs and 30 percent of the annual

UNICEF requirement.

(Source: FICCI Report Trends & Opportunity for Indian pharma 2018)

The Indian pharmaceuticals market is the third largest in terms of volume and thirteenth largest in terms of value, as

per a report by Equity Master. India is the largest provider of generic drugs globally with the Indian generics

accounting for 20 per cent of global exports in terms of volume. Of late, consolidation has become an important

characteristic of the Indian pharmaceutical market as the industry is highly fragmented.

India enjoys an important position in the global pharmaceuticals sector. The country also has a large pool of

scientists and engineers who have the potential to steer the industry ahead to an even higher level. Presently over 80

per cent of the antiretroviral drugs used globally to combat AIDS (Acquired Immuno Deficiency Syndrome) are

supplied by Indian pharmaceutical firms.

The UN-backed Medicines Patent Pool has signed six sub-licences with Aurobindo, Cipla, Desano, Emcure, Hetero

Labs and Laurus Labs, allowing them to make generic anti-AIDS medicine TenofovirAlafenamide (TAF) for 112

developing countries.



Market Size

Indian pharmaceutical sector is estimated to account for

3.1 – 3.6 per cent of the global pharmaceutical industry

in value terms and 10 per cent in volume terms. It is

expected to grow to US$100 billion by 2025. The

market is expected to grow to US$ 55 billion by 2020,

thereby emerging as the sixth largest pharmaceutical

market globally by absolute size. Branded generics

dominate the pharmaceuticals market, constituting

nearly 80 per cent of the market share (in terms of

revenues).

85

India’s pharmaceutical exports stood at US$ 16.8 billion in 2016-17 and are expected to grow by 30 per cent over

the next three years to reach US$ 20 billion by 2020, according to the Pharmaceuticals Export Promotion Council of

India (PHARMEXCIL). Export of pharmaceutical items reached ₹ 696.84 billion (US$ 10.76 billion) during April

2017 – January 2018.

The Pharmaceutical sector is expected to generate 58,000 additional job opportunities by the year 2025

Indian companies received 304 Abbreviated New Drug Application (ANDA) approvals from the US Food and Drug

Administration (USFDA) in 2017. The country accounts for around 30 per cent (by volume) and about 10 per cent

(value) in the US$ 70-80 billion US generics market.

India's biotechnology industry comprising bio-pharmaceuticals, bio-services, bio-agriculture, bio-industry and

bioinformatics is expected grow at an average growth rate of around 30 per cent a year and reach US$ 100 billion by

2025. Biopharma, comprising vaccines, therapeutics and diagnostics, is the largest sub-sector contributing nearly 62

per cent of the total revenues at ₹ 12,600 crore (US$ 1.89 billion).


Investments

The Union Cabinet has given its nod for the amendment of the existing Foreign Direct Investment (FDI) policy in

the pharmaceutical sector in order to allow FDI up to 100 per cent under the automatic route for manufacturing of

medical devices subject to certain conditions.

The drugs and pharmaceuticals sector attracted cumulative FDI inflows worth US$ 15.59 billion between April 2000

and December 2017, according to data released by the Department of Industrial Policy and Promotion (DIPP).

Some of the recent developments/investments in the Indian pharmaceutical sector are as follows:

As of March 2018, a consortium led by Indian private equity firm Chrys Capital is planning to buy a 10 per

cent stake in Mankind Pharma for US$ 350 million.

The exports of Indian pharmaceutical industry to the US will get a boost, as branded drugs worth US$ 55

billion will become off-patent during 2017-2019.

Private equity and venture capital (PE-VC) investments in the pharmaceutical sector have grown at 38 per

cent year-on-year between January-June 2017, due to major deals in this sector.



86

Advantage of Indian Pharma Industries


Government Initiative

Some of the initiatives taken by the government to promote the pharmaceutical sector in India are as follows:

In March 2018, the Drug Controller General of India (DCGI) announced its plans to start a single-window

facility to provide consents, approvals and other information. The move is aimed at giving a push to the

Make in India initiative.

The Government of India is planning to set up an electronic platform to regulate online pharmacies under a

new policy, in order to stop any misuse due to easy availability.

The Government of India unveiled 'Pharma Vision 2020' aimed at making India a global leader in end-to-

end drug manufacture. Approval time for new facilities has been reduced to boost investments.

The government introduced mechanisms such as the Drug Price Control Order and the National

Pharmaceutical Pricing Authority to deal with the issue of affordability and availability of medicines.


Opportunity for India as a global supply destination

India’s strong position as a pharma supplier rests on its ability to provide high quality medicines backed by strong

innovation capabilities and a structural cost advantage.

The cost of manufacturing formulations in India remains 30‐40 percent lower than other comparative manufacturing

hubs such as China and Eastern Europe, notwithstanding low productivity levels15. This is driven by lower labour

costs vis‐à‐vis other geographies16. Despite inflationary trends, India’s labour cost advantage will sustain in the

medium to long term, especially if Indian companies can improve productivity through operational excellence and

digital initiatives.

The supply of local talent into the pharma industry (e.g., B.Pharm, M.Pharm, B.Sc.) is stronger than in countries

such as China. Indian pharma companies are foraying into complex products (e.g., microspheres, liposomes,

87

emulsions), building capabilities in R&D and the manufacturing of these products while still ensuring the required

quality.

However, the industry is also facing several challenges in supplying to export markets, which must be addressed

going forward.

The increasing pricing pressure in the regulated market is squeezing margins and profitability. Key drivers

include customer consolidation, greater competition in commoditized, easy‐to‐ manufacture products with

increased ANDA approvals, and a slowdown in new launches.

Another key challenge stems from compliance issues affecting the reliability of supply. While many Indian

companies have fared well in regulatory audits over the last year and seem to be emerging out of

remediation, others continue to face challenges.

India continues to rely on imports of key starting materials, intermediates and API’s for, China with the

share of dependence increasing over time. This potentially exposes us to raw material supply disruptions

and pricing volatility.

There is an opportunity for India Pharma to drive growth by building on the cost advantage, and improving

reliability of supply—major buying criteria for customers. Three priority areas thus emerge for Indian

pharmaceutical companies:

Build stronger quality systems and achieve full compliance

Re‐focus efforts on operational excellence

Alternate sourcing and self‐sufficiency in APIs / intermediates

These imperatives are inter‐related—operational excellence is a strong enabler of quality and supply reliability.

Analysis based on McKinsey’s proprietary POBOS database of global pharmaceutical manufacturing sites shows

that the sites with the best quality performance also often have the best operations performance.

(Source: FICCI Report Trends & Opportunity for Indian pharma 2018)

PHARMA EXPORT TO CONTINUE WITNESSING POSITIVE GROWTH

India is the world’s largest provider of generic medicines; the country’s generic drugs account for 20 per

cent of global generic drug exports (in terms of volumes). Indian drugs are exported to more than 200

countries in the world, with the US as the key market.

Indian pharma companies are capitalising on export opportunities in regulated and semi-regulated markets.

The Indian pharmaceutical industry is expected to grow at a compound annual growth rate (CAGR) of 22.4

per cent to touch US$ 55 billion by 2020, from US$ 20 billion in 2015.

EXPORTS AND ADVANTAGE INDIA

The Indian Pharmaceuticals Industry (IPI) earns around 70 per cent of its revenues from sale of generic

drugs and generates around 50 per cent of its revenues from exports.

India is the largest supplier of generic medicines globally (20 per cent of global export volume).

Pharmaceutical export from India stood at US$ 16.84 billion in 2016-17, and is expected to reach US$ 20

billion by the year 2020.

India has one of the lowest manufacturing costs in the world. Manufacturing cost in India is approximately

35–40 per cent of that in the US as installation and workforce costs are low.

India is expected to rank amongst the top three pharmaceutical markets in terms of incremental growth by

2020.

(Source: https://www.ibef.org/exports/pharmaceutical-exports-from-india.aspx)


https://www.ibef.org/exports/pharmaceutical-exports-from-india.aspx

88


Indian Pharma Sector Revenues Trending North

Pharmaceutical Exports from India(US$ billion)

20.0

18.0

16.0

16.9 16.8 17.3

17.3

14.0 14.5 14.9

12.0 12.6

10.0 10.1

8.0

6.0

4.0

2.0

0.0 FY12 FY13 FY14 FY15 FY16 FY17 FY18

89

Indian pharmaceutical market grew 5.5 per

cent in CY2017 in terms of moving annual

turnover with a turnover of ₹ 1.16 trillion

(US $ 18.06 billion).

By 2020, India is likely to be among the

top three pharmaceutical markets by

incremental growth and 6th largest market

globally in absolute size.

India’s cost of production is significantly

lower than that of the US and almost half

of that of Europe. It gives a competitive

edge to India over others.

Increase in the size of middle class

households coupled with the improvement

in medical infrastructure and increase in

the penetration of health insurance in the

country will also influence in the growth

of pharmaceuticals sector

With 70 percent of market share (in terms

of revenues), generic drugs from the

largest segment of the Indian

pharmaceuticals sector

India supplies 20 percent of global generic

medicines market export, in terms of

volume, making the country largest

provider of generic medicines globally and

expected to expand even further in coming

years

Over the counter (OTC) medicines and

patented drugs constitute 21 percent and 9

percent, respectively of total market

revenue of US $ 20 billion

The share of generic drugs is expected to

continue increasing; domestic generic

drugs market is expected to reach US$

27.9 billion in 2020

Due to their competence in generic drugs,

growth in this market offers a great

opportunity for Indian firms

Generic drugs market is expected to grow

in the next few years, with many drugs

going-off patent in the US and other

countries

Domestic generic drug market has reached

US$ 1billion in 2016


GROWTH DRIVERS OF INDIAN PHARMA SECTOR

90

Cost advantage

Skilled manpower

India a major

manufacturing hub for

generics

Increasing penetration of

chemists

Increasing fatal diseases

Accessibility of drugs to

greatly improve

Increasing penetration

of health insurence

Better diagnostic

facilities

National Health policy 2015, which focus on increase public

expenditure on healthcare segment

Reduction in approval time for new facilities

Plans to set up new pharmaceuticals education and research institute

Exemptions to drugs manufactured through indigenous R&D from

price control under NPPP-2012

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Accessibility

Over US$ 200 billion to be spent on medical

infrastructure in the next decade

New business models expected to penetrate tier-2 and 3

cities

Over 160,000 hospital beds expected to be added each

year in the next decade

India’s generic drugs account for 20 per cent of global

exports in terms of volume, making the country the

largest provider of generic medicines globally

Epidemiological factors

Patient pool expected to increase over 20 per cent in the

next 10 years, mainly due to rise in population

New diseases and lifestyle changes to boost demand

Increasing prevalence of lifestyle diseases

Affordability

Rising income could drive 73 million households to the

middle class over the next 10 years

Over 650 million people expected to be covered by

health insurance by 2020

Government-sponsored programmes set to provide

health benefits to over 380 million BPL people by the

end of 2017

The government plans to provide free generic

medicines to half the population at an estimated cost of

US$ 5.4 billion

Acceptability

Rising levels of education to increase acceptability of

pharmaceuticals

Patients to show greater propensity to self-medicate,

boosting the OTC market

Acceptance of biologics and preventive medicines to

rise

A skilled workforce as well as high managerial and

technical competence

Surge in medical tourism due to increased patient

inflow from other countries

Demand drivers

DEMAND DRIVERS OF INDIAN PHARMA SECTOR


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Road Ahead The Indian pharmaceutical market size is expected to grow to US$ 100 billion by 2025, driven by increasing

consumer spending, rapid urbanisation, and raising healthcare insurance among others. Pharma sector’s revenues

are expected to grow by 9 per cent year-on-year through fiscal 2020.

Going forward, better growth in domestic sales would also depend on the ability of companies to align their

product portfolio towards chronic therapies for diseases such as such as cardiovascular, anti-diabetes, anti-

depressants and anti-cancers that are on the rise.

The Indian government has taken many steps to reduce costs and bring down healthcare expenses. Speedy

introduction of generic drugs into the market has remained in focus and is expected to benefit the Indian

pharmaceutical companies. In addition, the thrust on rural health programmes, lifesaving drugs and preventive

vaccines also augurs well for the pharmaceutical companies.


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OUR BUSINESS


Registrar of Companies, Jalandhar as a Private Limited company under the provisions of the Companies Act, 1956.

Subsequently, our Company was converted into a Public Limited Company and the name of our Company was

changed to ‘Preet Remedies Limited’. A fresh certificate of incorporation consequent upon conversion to public

limited Company was issued by the Registrar of Companies, Chandigarh on February 06, 2018. The Corporate

Identification Number of our Company is U24230CH2005PLC027954.

Our Company is working as a contract manufacturing company in India. With the help of our production unit, we

are capable to deliver the variety of product range to our customers. We have the capacity to deliver all type of

product range such as a Tablets Capsules, Ointment, Cream, Gel, Lotion, Shampoo & Dry syrup. Being a third-party

Pharma Manufacturing, we make use of best quality raw material and cutting-edge tools.

Our registered and corporate office is situated at Chandigarh and manufacturing unit of our Company is located at

Baddi, Himachal Pradesh.

Our Promoters have been instrumental in shaping the value system of our Company. With their rich experience of

two decades, we shall continue to grow in the pharmaceutical industry. We value our customers and aim to exceed

the expectations of our customers by offering diverse products and fulfilling valuable commitments.

OUR BUSINESS ACTIVITY

DOMESTIC MARKET OPERATION

We are mainly engaged in third party manufacturing of Tablets, Capsules, Ointment, Cream, Gel, Lotion, Dry Syrup

and Shampoo, these Products are manufactured at our existing facility.

SALES AND MARKETING STRATEGY

The efficiency of the marketing and sales network is critical to the success of every Company. Our success lies in

the strength of our relationship with our channels that are associated with our Company.

Domestic Market

(Manufacturing)

TABLETS CAPSULES OINTMENT CREAM, GEL

& SHAMPOO

LOTION & DRY SYRUP

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Contract Manufacturing Pharma–We are one of the leading Contract Manufacturing Company in Baddi. With the

help of our large-scale production unit, we are capable to deliver the variety of drug ranges to our associates. We

have the capacity to deliver all type of product range such as a Tablets, Capsules, Ointment, Cream, Gel, Lotion,

Shampoo and Dry Syrup. We make use of best quality raw material and cutting-edge tools.

EXPERIENCE PROMOTER AND MANAGEMENT TEAM

Our Promoters are engaged in the pharmaceutical business since more than two decades and has good experience in

the pharmaceutical industry. Also, our Company is managed by a team of dedicated personnel. The experience of

our management team and dedicated personnel enable us to continue to take advantage of both current and future

market opportunities thus expanding our business horizons.

PRODUCT RANGE

We are capable to deliver the variety of drug range to our esteemed customers. It consists of all the essential drugs

which have high demand in the market. The formulations which we are delivering to our customers are as under:

Oral Solid Dosages Forms

Tablets

Capsules

Dry Syrup

External Preparations

Ointment

Cream

Gel

Lotion

Shampoo

All our offered drugs are quality approved and available at reasonable prices.

With the help of our comprehensive experience in producing pharma products, we help our associates with the

variety of flawless drug range. We annually manufacture or deliver around 400+ drugs segment to our customers.

We possess 13 years of working experience, in producing and supplying the variety of drug range. We bring

transparency in our work so that our associates can inspect and be satisfied with each business operation and can

detect whether they are going smoothly or not. Below are the highlights of our company:

Ability to deliver the variety of drug range to our customers

Make on-time delivery of products

Variety of drug range at just one platform

All the drugs are available at reasonable prices

DCGI and GMP approved drug range

OUR TOP 10 CUSTOMERS ARE AS FOLLOWS:-

1. Zydus Healthcare Limited

2. Intas Pharmaceuticals Limited

3. Alkem Laboratories Private Limited

4. Zenlabs Ethica Limited

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5. Wockhardt Limited

6. Smart Laboratories Private Limited

7. Morepen Laboratories Limited

8. Care Formulation Private Limited

9. Elixir Life Care Private Limited

10. Knoll Healthcare Private Limited

MANUFACTURING PROCESS

COMPRESSION

D-TOOLONG 27 STATION

MACHINE

B-TOOLONG 35 STATION

MACHINE

MORE THEN 500 MG TABLETS 100 MG TO 700 MG TABLETS

SAMPLE SENT TO QC

DEPARTMENT FOR APPROVEL

SAMPLE SENT TO QC

DEPARTMENT FOR APPROVEL

COATING

SAMPLE TO QC

PACKING

STRIP PACKING BLISTER PACKING

FINISH PRODUCH RELEASE FOR QC

FINISH GOODS STORE

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Tablets:

The manufacture of tablets is a complex multi-stage process under which the materials change their physical

characterstics a number of times before the final dosage from is produced. The tablets are made by granulation; wet

granualation and dry granulation. Regardless of whether tablets are made by direct compression or granuation, the

steps of milling and mixing, is the same. Numerous unit processes are involved in making tablets, including

particular size reduction and sizing, blending, granulation, drying, compaction and (frequently) coating, Various

factors associated with these processes can seriously affect content uniformity, bioavailability or stability.

VERIFICATION OF R.M 10 MINUTES

SHIFTING

PASTE PREPERATION DRY MIXING 30 MINUTES 120 MINUTES

WET GRANULATION

AND UNLOADING

30 MINUTES

DRYING 90 MINUTES

SIFTING 45 MINUTES

MILLING 20 MINUTES

WEIGHING OF DRIED GRANULES AND

45 MINUTES

BLENDING

BLENDED GRANULES

SAMPLES SENT TO QC 60 MINUTES

QC APPROVED

ALL ABOVE ACTIVITIES ARE IN GRANULATION SECTION

R.M. DAY STORE

BATCH CAPACITY 200 – 250 KG

FLOW DIAGRAM AND CAPACITY OF TABLET SECTION

97

VERIFICATION OF R.M

SOLUBILIZATION OF ACTI VE INGREDIENTS

IN MIXING TANK -PREPRATION OF

BASE+ ADDING OF ACTIVE

*MIXING- 1.5 to 2 hrs & checking of PH

SAMPLES SENT TO QC FOR ANALYSIS

QC APPROVED

DISPENSING

FLOW DIAGRAM OF SHAMPOO SECTION

TRANSFER TO STORAGE TANK FOR FILLING

IPQA CHECK

TRANSFER FOR

STORAGE/DESPATCH

BOX PACKING & SHIPPER PACKING

TRANSFER TO HOPPER & FILLING AS PER

SPECIFIED WEIGHT

FILLING &

IPQA CHECK

98

Dry Syrup

Dry syrups which are also known as powder for suspension are dosage froms that contain the medication in powder

from. This solid powder should be reconstituted by dissolving or suspending in water before administration. Dry

Syrup is usally suitable for children and elderly patients because of easy administration. Many antibiotics which are

not stable in liquid media for long period can easily supply in this dry form. They are to be reformulated by mixing

with certain amount of boiled water and should be use up within certain periods of times which is normally 5 days.

The processing steps are also reduced for dry syrup compared to other oral liquids and subsequently reduced cost.

VERIFICATION OF R.M

PROCESS FOR GRANULES BASE

1. SHIFTING

2. GEOMETRICAL MIXING

FINAL MIXING IN BLENDER

FOR 30 MINUTES

BLENDED SAMPLES SENT TO QC FOR

ANALYSIS

QC APPROVED

DISPENSING

FLOW DIAGRAM OF DRY SYRUP SECTION

LABELLING

IPQA CHECK

TRANSFER TO STORE

BOX PACKING & SHIPPER PACKING

TRANSFER TO HOPPER & FILLING AS PER

SPECIFIED WEIGHT

99


R.M. DAY STORE

BATCH CAPACITY 500 kg.

FLOW DIAGRAM AND CAPACITY OF OINTMENT SECTION

QC APPROVED

FINISH GOODS STORAGE

CREAM MANUFACTURING (TANK CAPACITY 500 kg)

AQUEOUS PHASE PREPARATION TANK CAP. 250 kg.

HOMONISER & MIXING

TRANSFER TO STORAGE TANK THROUGH PUMP CAPACITY 500 kg

FILLING & SEALING

20 gm TUBE 15 gm TUBE 50-60 TUBES / MINUTE WITH SINGLE NOZZLE

PACKING

OIL PHASE PREPARATION TANK CAP. 250 kg.

4 hrs

QC APPROVED

40 MINUTES

60 MINUTES

100


SHIFTING

BLENDING AND UNLOADING

BLENDED SAMPLES SENT TO

QC

15 MINUTES

QC APPROVED

R.M. DAY STORE

BATCH CAPACITY 250 KG

FLOW DIAGRAM AND CAPACITY OF CAPSULE SECTION

45 MINUTES

CAPSULE FILLING (85-90 STOCKS /

MINUTE)

POWDER – 3.25 LACS / 8 HRS PELLETS – 2.85 LACS / 8 HRS

POLISHING 5-6 LAC / 8 HRS POLISHING 5-6 LAC / 8HRS

QC APPROVED

PACKING

STRIP 2.5-3 LACS / 8 HRS BLISTER 7-8 LACS /8 HRS

QC APPROVED

FINISH GOODS STORAGE

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BRAND IMAGE

We would continue to associate ourselves with good quality customers and execute projects to their utmost

satisfaction. We are highly conscious about our brand image and intend to continue our brand building exercise by

providing excellent services to the satisfaction of the customers. Leading medicine which we manufacture for our

customers are as under: -

Drugs Products Customers Uses

Mecofol plus NF Capsule Intas Pharmaceuticals

Limited

Multivitamin used for

nervous system

Intagesic plus Gel Intas Pharmaceuticals

Limited

Analgesic, mussel

relaxant

App UP Tablet Intas Pharmaceuticals

Limited

Appetizer

FCN 150 Tablet Intas Pharmaceuticals

Limited

Antifungal

Soregel Tablet Intas Pharmaceuticals

Limited

Antibiotic mouth ulser

gel

Thrombotas Ointment Intas Pharmaceuticals

Limited

Anticoagulant

Acceclowoc SP Tablet Wockhardt Limited Analgesic, anti-

inflamatory

Wofol Z Capsule Wockhardt Limited Heamatinic

Shevcal Tablet Knoll Healthcare Private

Limited

Calcium & vitd3

replenisher

Ramirace2.50 Tablet Knoll Healthcare Private

Limited

antihypertensive


Limited

antihypertensive


Limited

antihypertensive

D-fress MR Tablet Smart Laboratories Private

Limited

Analgesic, mussel

relaxant

Norfresh TZ Tablet Smart Laboratories Private

Limited

Antiparasite antibiotic

Dolofresh MR Tablet Smart Laboratories Private

Limited

Analgesic, mussel

relaxant

Dolofresh SP Tablet Smart Laboratories Private

Limited

Analgesic, anti-

inflamatory.

PRODUCT ARTWORK

Our company manufacture the drugs through Product Artwork. The purpose of Product Artwork is to distinctly

brand the product so that it is distinguishable and attractive to the potential consumer. As with the project software,

the vision and product features and associated artwork are refined over successive iterations. The product artwork is

created by the Customer under the direction of the overall project vision, and the exact artifacts required in mass

producing the product. Product artwork includes both the textual and graphical aspects of the product.

QUALITY ASSURANCE

We believe that quality is an ongoing process of building and sustaining relationships. Our strong commitment of

providing quality products is boasted by our industry knowledge. We have obtained Goods Manufacturing

Practices (WHO Technical Reports 37th Series 908 - Thirty Seventh Report 2003 published by WHO) for the

102

Quality Management from Euro Conformity Assessment for our Export-Import and manufacturing operations

involving Pharmaceutical Materials, Formulations items. Further, we ensure that our third-party manufacturing

facilities are accredited with the necessary approvals and provide quality output for our customers.

OUR BUSINESS STRATEGY

We envisage long term growth by supplying qualitative products and building long term relations with customers. In

line with this vision, our Company is implementing a business strategy with the following key components. Our

strategy will be to focus on capitalizing on our strengths and expanding the operations of our business. We intend to

focus on our existing range of products with specific emphasis on the following factors as business and growth

strategy:

1. Leveraging our Market Skills and relationship

Leveraging our market skills and relationships is a continuous process in our organization and the skills that we

impart in our Employees give value for money to our customers. We aim to do this by leveraging our market skills

and relationships.

2. Customer Satisfaction

The business of our Company is customer oriented and always strives to maintain good relationship with the

customers. Our Company‘s marketing team approaches existing customers for their feedback and based on their

feedback any changes in the products if required are carried out. Our Company provides quality products and

effective follow-ups with customers who ensure that the customers are satisfied with the product and do not have

any complaint.

3. Scalable Business Model

Our Business model is customer centric and order driven, and requires optimum utilization of our existing resources,

assuring quality supply and achieving consequent economies of scale. The business scale generation is basically due

to development of new markets by exploring customer needs, marketing expertise and by maintaining the consistent

quality output. We believe that our business model is scalable.

SWOT ANALYSIS

Strengths Weakness

Leveraging our Market Skills and relationship

Scalable Business Model

Customer Satisfaction

103

Competitive pricing better than or equal

that of our rivals

Strong marketing strategy that will prove

to be effective, helping to raise profiles

and profits

High quality products and services that

help to ensure customers return

R&D work is insignificant, which is a major weakness

in pharmaceuticals business as it is constantly creating

new products

Our company does not function internationally, which

has an effect on success since, we do not reach

consumers in overseas markets

No established relations with physicians or patients

Opportunies Threats

Looking at export market to enhance

profits

Grasping the opportunity to expand the

customer base geographically and through

new products

Expanding into new markets

Increased competition from domestic manufacturer

Price wars between competitors, price cuts and so on

could damage profits

Rising costs

Increased supplier prices

RAW MATERIAL

Our manufacturing processes require a wide variety of raw materials like APIs and excipients. For our varied

products range of pharmaceutical formulations, we require different APIs viz. Amoxycillin, Cefixime,

Cefpodoxime, Cefuroxime, Clavulanate, Atorvastatin, Rosuvastatin, cloxacillin paracetamol, nimesulide

cloroxazone seratiopeptidase, mecobalamine, alpha lipoic acid norfloxacin, tinidazole, ciprofloxacin, levocetrizine,

cetirizine, and different excipients viz. starch DP, MCCP plain, Calcium C.M.C, Talcom, Gelatin, C.mc, peg-400,

peg-4000, sles, sls sodium, cetosteryl alcohol, cetomagrogol, Gms etc. For our neutraceutical products, we generally

require coenzyme q10, L-carnatine Biotin and all segments of Vitamins A, C Vt, B1, B2, B6B12,

Methylcobalamine. Omega-3 fatty acid, alpha lipoic acid, amino acids, lycopene, Beta carotene, Grape seeds extract,

green tea extract, Sodium sulphate, folic acid, calcium pantothenate, para amino and various type of Micro nutrients

& trace aliments. We also require primary packaging materials (such as primary, printed and other materials) which

includes glass bottles, pet bottles, glass vials, glass ampoules printed labels, printed cartons etc., and services from

good manufacturing practices service providers. Further at present we are outsourcing manufacturing of our

cosmetic and skincare products. We purchase these raw materials from a list of sources that we maintain, after a

quality assurance approval which has been approved by our internal quality control department process as well as by

our customers.

UTILITIES & INFRASTRUCTURE

Location

The Registered office of the company is situated at (leased property) Plot No 194-195, Third Floor, Industrial Area

Phase II, Chandigarh 160 002 admeasuring 5,000 Sq. Ft. The company has a manufacturing unit at Plot no. 183,

184, 185, 186 HPSIDC, Industrial Area, Baddi-173 205 admeasuring 2016 Sq. Mtrs.

Power

104

We have arrangements for regular power supply at our factory premises, registered office and warehouse. At our

registered office we meet our power requirements by purchasing electricity from Union Territory, Chandigarh

Electricity Department.

At our manufacturing unit, we meet our power requirements by purchasing electricity from Himachal Pradesh State

Electricity Board.The current connected load is 298.98 KW . We also have DG set to meet with any contingencies.

At our warehouse, we meet our power requirements by purchasing electricity from Himachal Pradesh State

electricity Board.

Water

Our registered office and warehouse has adequate water supply arrangements for human consumption and sanitation

purpose which is supplied by local bodies. Our manufacturing unit’s current water requirement is for carrying out

manufacturing operations, human consumption and general needs of the employees. Water requirement at Plant is

met by the Himachal Pradesh state Industrial Development Corporation Ltd. As high purity water is used in the

pharmaceutical industry, our Company has installed water purification / processing system which ensures required

purity of the water.

Boiler

We have boiler of 20 mts. of 200kg with consumption limit of 70 ltr at our manufacturing unit situated at Plot No

183-186. HPSIDC, Industrial Area, Baddi, Distt. Solan, (HP) Baddi – 173205.

Air Handling Unit

The Air Handling System is installed to maintain the temperature within both our manufacturing premises which

includes climatic conditions, humidity controlled by dehumidifier, air flow etc. Clean Room AHU’s are provided

with appropriate pre-filters and terminal High Efficiency Particulate (HEPA) Air Filters. The clean rooms are

maintained at appropriate air pressures to avoid contaminations and relative humidity. We further propose to

upgrade our existing AHU at Baddi in accordance with WHO GMP guidelines.

PLANT & MACHINERY

Our company is presently having the following plant and machinery at our Baddi Unit:-

Water System

Lami Tube Filling machine

105

45 station Tablet Compression

Blister Packing Machine

Alu – Alu Packing

SA 9 Capsule machine

Fluid bed drier

Lami Tube Filling Machine

CAPACITY AND CAPACITY UTILISATION

Capacity per annum Installed Capacity per

annum

2015-16 2016-17 2017-18

Tablets 144 Crores units 65 Crore units 70 Crore units 60 Crore units

Capsules 28.80 Crores units 18 Crore units 18 Crore units 15 Crore units

Cream/Ointments/Lotion 5.50 Crores units 4.20 Crore units 4 Crore units 4.20 Crore units

COLLABORATIONS

As on date of this Draft Prospectus, our Company has not entered into any Collaboration/ Tie-Ups/ Joint Ventures

with anyone.

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HUMAN RESOURCES

We believe that our employees are key contributors to our business success. We focus on attracting and retaining the

best possible talent. Our Company looks for specific skill-sets, interests and background that would be an asset for

our business. As on March 31, 2018, we have 165 employees/workers at our registered office and manufacturing

unit/warehouse and the details are as under:-

MAN POWER STATUS

TECHNICAL SKILLED SEMISKILLED UNSKILLED

Required Present Required Present Required Present Required Present

10 8 60 56 25 23 80 78

These employees look after our business operations including Production, R&D, Quality Assurence, Purchase

Marketing, Accounts, Stores and administration, secretarial and other functions etc.

Our manpower is a prudent mix of the experienced and youth which gives us the dual advantage of stability and

growth. Our work progress and skilled/ semi-skilled/ unskilled resources together with our strong management team

have enabled us to successfully implement our growth plans. Our employees are not currently unionized, and there

have been no work disruptions, strikes, lock-outs or other employee unrest to date. The Company believes that its

relations with its employees are excellent.

COMPETITION

Our Company operates in the pharmaceutical sector which faces competition from domestic players. Competition

emerges from both organized and unorganized sector. The primary competitive factors consist of quality, price, size

of product portfolio and customer service. Moreover, as we seek to diversify into new geographical areas globally,

we may face competition from local companies, multinational corporations and companies from other emerging

markets operating in such markets.

EXPORT AND EXPORT OBLIGATION

As on date of this Draft Prospectus, our Company does not have any Export Obligation.

INSURANCE POLICIES

Our Company has insurance coverage which we consider reasonably sufficient to cover all normal risks associated

with our operations and which we believe is in accordance with the industry standards. Further, our contractual

obligations to our lenders also require us to obtain specific insurance policies. We have taken Standard Fire &

Special Perils Policy and Burglary Insurance policy for a substantial majority of our assets at our office, factory and

warehouse. These policies also insure us against the risk of earthquakes (fire and shock).

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We believe that our insurance coverage is adequate for our business needs and operations. We will continue to

review our policies to ensure adequate insurance coverage is maintained.

OUR PROPERTIES

We have our properties located at following:

OWENED PROPERTIES

Sr.

No. Address of the property

Area of the property Current Usage

1 Plot no. 183, 184, 185 and 186 HPSIDC Industrial

Area, Baddi, District Solan, Himachal Pradesh 2016 Sq. Mtrs. Manufacturing

Unit and

Warehouse

Leased Properties: Sr. No. Name of the

Lessor

Name of the

Lessee

Location of

Property

Area of the

property

Consideration Period of

the

agreement

Usage

1. Shri

Manmohan

Singh Chadha

and Prithipal

Singh Chadha

Shri Harpreet

Singh, Director

and Authorised

Signatory Preet

Remedies

Limited

Plot no. 194-195,

3rd Floor,

Industrial Area

Phase-II,

Chandigarh-

160002

5,000 Sq. Ft. Monthly Fixed

Rent of ₹

70,000/-

+

Security

Deposit for 2

months

+

Increase 5 %

P.A.

From July

01, 2010

to June 30,

2019

Registered

and Corporate

Office

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KEY INDUSTRY REGULATIONS AND POLICIES

The following description is a summary of the relevant sector specific regulations and policies, as prescribed by

the Government of India or State Governments which are applicable to our Company and our business. The

information detailed in this chapter has been obtained from designated not intended to substitute for

professional legal advice. The statements below are based on the current provisions of Central and the State

laws, and the judicial and administrative interpretations thereof, which are subject to change or modification

publications available in the public domain. The regulations set out below may not be exhaustive and are only

intended to provide general information to the investors and are neither by subsequent legislative, regulatory,

administrative or judicial decisions.

I. Industry Regulations

The Micro, Small and Medium Enterprise Development ("Act, 2006 MSMED Act")

The MSMED Act seeks to provide for the promotion and development along with facilitating and enhancing

competition among micro, small and medium enterprises. The MSMED Act inter-alia empowers the Central

Government to classify by notification, any class of enterprises including a company, a partnership, firm or

any other undertaking engaged in the manufacture or production as specified in the first schedule to the

Industries (Development and Regulation) Act, 1951, as follows:

(i) A micro enterprise, where the investment in plant and machinery does not exceed ₹ 25.00 Lakhs;

(ii) A small enterprise, where the investment in plant and machinery is more than ₹ 25.00 Lakhs but does

not exceed ₹ 500.00 Lakhs; or

(iii) A medium enterprise, where the investment in plant and machinery is more than ₹ 500.00 Lakhs but

does not exceed ₹ 1,000 Lakhs.

The MSMED Act also stipulates that any person who intends to establish, a micro or small enterprise or a

medium enterprise engaged in rendering of services, may at his discretion and a medium enterprise engaged in

the manufacture or production of goods as specified hereinabove, file a memorandum of micro, small or

medium enterprise, as the case may be, with the prescribed authority.

The Drugs and Cosmetics Act, 1940 ("The DCA, 1940") and the relevant rules

The DCA regulates the import, manufacture, distribution and sale of drugs and cosmetics. In view of the

provisions of the DCA, no person can import, manufacture, distribute, stock and sell any drugs and cosmetics,

except under the license granted for respective operations by the authority notified under the DCA. The DCA

prescribes the standards for purity, identity and strength of drugs and cosmetics while also prohibiting the

import of certain categories of drugs and cosmetics. The DCA mandates that every person holding a license must

keep and maintain such records, registers and other documents as may be prescribed which may be subject to

inspection by the relevant authority. The DCA provides for the Ayurvedic Siddha and Unani Drugs Technical

Advisory Board to advise the Central and State Governments on technical matters. The legislation provides the

procedure for testing and licensing of new drugs. These procedures involve obtaining a series of approvals for

different stages at which the drugs are tested, before the Drug Controller General of India ("DCGI") grants

the final license to allow the drugs to be manufactured and marketed. At the first instance, an application is made to

the DCGI, an authority established under the DCA. The DCGI issues a no objection certificate upon examining

the medical data, the chemical data and the toxicity of the drug. This allows the drug to move on to the next stage

of testing at the central drug laboratories. At the central drug laboratories, the drug is subjected to a series of tests for

its chemical integrity and analytical purity and if it meets the standards required by the authority, the authority issues

a certificate in that respect.

The Drugs and Cosmetics Rules, 1945 ("DC Rules") have been enacted to give effect to the provisions of the DCA

to regulate the manufacture, distribution and sale of drugs and cosmetics in India. The DC Rules prescribe

the procedure for submission of report to the Central Drugs Laboratory, of samples of drugs for analysis or test,

the forms of Central Drugs Laboratory’s reports thereon and the fees payable in respect of such reports. The DC

Rules also prescribe the drugs or classes of drugs or cosmetics or classes of cosmetics for the import of which a

license is required, and prescribe the form and conditions of such licenses, the authority empowered to issue the

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same and the fees payable thereof. The DC Rules provide for the cancellation or suspension of such license in any

case where any provisions or rule applicable to the import of drugs and cosmetic is contravened or any of the

conditions subject to which the license is issued is not complied with. The DC Rules further prescribe the

manner of labeling and packaging of drugs. The DC Rules lay down the process mechanics and guidelines for

clinical trial, including procedure for approval for clinical trials. Clinical trials require obtaining of free, informed

and written consent from each study subject. The DC Rules also provide for compensation in case of injury or death

caused during clinical trials. The Central Drugs Standard Control Organization has issued the guidance for industry

for submission of clinical trial application for evaluating safety and efficacy, for the purpose of submission of

clinical trial application as required under the DC Rules. The Indian Council of Medical Research has issued the

Ethical Guidelines for Biomedical Research on Human Participants, 2006 which envisages that medical and related

research using human beings as research participants must, necessarily, inter alia, ensure that the research is

conducted in a manner conducive to, and consistent with, their dignity, well-being and under conditions of

professional fair treatment and transparency. Further such research is subjected to evaluation at all stages of the

same.

The Essential Commodities Act, 1955 ("ECA")

The ECA provides for the control of the production, supply and distribution of, and trade and commerce in

certain commodities. The ECA gives powers to the Government amongst others, to control production, supply and

distribution of essential commodities for maintaining or increasing supplies and for securing their equitable

distribution and availability at fair prices. Using the powers under it, various ministries/departments of the

Government have issued control orders for regulating production, distribution, quality aspects, movement and

prices pertaining to the commodities which are essential and administered by them. The State Governments have

issued various control orders to regulate various aspects of trading in essential commodities such as food grains,

edible oils, pulses kerosene, sugar and drugs. The Collector of the District or the concerned authority has the power

to confiscate the commodity if it contravenes the order.

The Drugs Price Control Order, 2013 ("the DPCO, 2013")

The DPCO, 2013 was issued by the Central Government in exercise of its powers under the Essential

Commodities Act, 1955. As per the provisions of the DPCO, 2013 the government may, in order to achieve

adequate availability and to regulate the distribution of drugs, in cases of emergency or in the interest of the

public, direct any manufacturer of any active pharmaceutical ingredient or bulk drug or formulation to

increase the production and to sell such active pharmaceutical ingredient or bulk drug to such other

manufacturer(s) of formulations and to direct formulators to sell the formulations to institutions, hospitals or any

agency as the case may be. The DPCO, 2013 also lays down the formulae for calculation of ceiling prices and retail

prices of drug formulation. Section 7 of the Essential Commodities Act, 1955 provides for the list of certain price-

controlled drugs and the penalty for contravention of the provisions of the DPCO, 2013. The DPCO, 2013 also

provides that when an existing manufacturer of a drug with dosages and strengths as specified in National List

of Essential Medicines launches a new drug, such existing manufacturer is required to apply for prior price

approval of such new drug from the government. The DPCO, 2013 also prescribes certain instances in which

case the provision of the DPCO, 2013 will not be applicable, for instances, in the event a manufacturer produces

a new drug patented under the Indian Patent Act, 1970 through a product patent which has been developed

through indigenous research and development, the DPCO, 2013 will not be applicable to such drug for a period

of five years from the date of commencement of its commercial production in the country.

National Pharmaceuticals Pricing Policy, 2012 ("2012 Policy")

The National Pharmaceuticals Pricing Policy, 1994 ("1994 Policy") has been replaced by the drug policy of 2012

Policy and presently seeks to lay down the principles for pricing of essential drugs specified in the National

List of Essential Medicines-2015 declared by the Ministry of Health and Family Welfare, Government of India

and modified from time to time, so as to ensure the availability of such medicines would be regulated based on

the essential nature of the drugs. Further, the 2012 Policy will regulate the price of formulations only, through

market based pricing which is different from the earlier principle of cost based pricing. Accordingly, the

formulations at reasonable price. The 1994 Policy regulated the prices based on the economic criteria/market share

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principles. However, as per the 2012 Policy, the prices will be priced by fixing a ceiling price and the

manufacturers of such drugs will be free to fix any price equal to or below the ceiling price.

The National List of Essential Medicines, 2015

The National List of Essential Medicines, 2015 has been introduced to replace the National List of Essential

Medicines, 2011. This new list has added a total number of 160 medicines and has deleted 70 medicines,

which now contains a total of 376 medicines. The essentiality of a medicine has been considered in terms of its

dosage form and strength.

Legal Metrology Act, 2009 ("L.M. Act")

The L.M. Act governs the standards/units/denominations used for weights and measures as well as for goods

which are sold or distributed by weight, measure or number. It also states that any transaction/contract relating to

goods/class of goods shall be as per the weight/measurement/numbers prescribed by the L.M. Act. Moreover, the

L.M. Act prohibits any person from quoting any price, issuing a price list, cash memo or other document, in

relation to goods or things, otherwise than in accordance with the provisions of the L.M. Act. The specifications

with respect to the exact denomination of the weight of goods to be considered in transactions are contained

in the Rules made by each State. The Act also provides for Legal Metrology (General) Rules, 2011, which

may be followed for due compliance, if the respective State does not provide for Rules in this regard.

Sales Promotion Employees (Conditions of Service) Act, 1976 ("Sales Promotion Act")

The Sales Promotion Act regulates the conditions of service of sales promotion employees and applies to

pharmaceutical industry. It provides the conditions of appointment, leave and maintenance of registers and other

documents of such employees. The Sales Promotion Act provides monetary penalties for breach of its provisions.

Environment Legislations

Environment (Protection) Act, 1986 ("EP Act")

The main objective of this Act is to provide the protection and improvement of environment (which includes

water, air, land, human being, other living creatures, plants, micro-organism and properties) and for matters

connected therewith. The EP Act provides power to make rules to regulate environmental pollution, to notify

standards and maximum limits of pollutants of air, water, and soil for various areas and purposes, prohibition and

restriction on the handling of hazardous substances and location of industries. The Central Government is

empowered to constitute authority or authorities for the purpose of exercising of performing such of the

powers and functions, appoint a person for inspection, for analysis or samples and for selection or notification of

environmental laboratories. Such person or agency has power to inspect or can enter in the premises or can take

samples for analysis.

The Water (Prevention and Control of Pollution) Act, 1974 ("Water Act")

The Water Act aims to prevent and control water pollution as well as restore water quality by establishing and

empowering the Central Pollution Control Board and the State Pollution Control Boards. Under the Water Act, any

person establishing any industry, operation or process, any treatment or disposal system, use of any new or altered

outlet for the discharge of sewage or new discharge of sewage, must obtain the consent of the relevant State

Pollution Control Board, which is empowered to establish standards and conditions that are required to be

complied with. In certain cases, the State Pollution Control Board may cause the local Magistrates to restrain

the activities of such person who is likely to cause pollution. Penalty for the contravention of the provisions of the

Water Act include imposition of fines or imprisonment or both. The Central Pollution Control Board has powers,

inter alia, to specify and modify standards for streams and wells, while the State Pollution Control Boards have

powers, inter-alia, to inspect any sewage or trade effluents, and to review plans, specifications or other data relating

to plants set up for treatment of water, to evolve efficient methods of disposal of sewage and trade effluents on

land, to advise the State Government with respect to the suitability of any premises or location for carrying on

any industry likely to pollute a stream or a well, to specify standards for treatment of sewage and trade effluents,

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to specify effluent standards to be complied with by persons while causing discharge of sewage, to obtain

information from any industry and to take emergency measures in case of pollution of any stream or well. A

central water laboratory and a state water laboratory have been established under the Water Act.

The Air (Prevention and Control of Pollution) Act, 1981 ("Air Act")

Pursuant to the provisions of the Air Act, any person, establishing or operating any industrial plant within an air

pollution control area, must obtain the consent of the relevant State Pollution Control Board prior to

establishing or operating such industrial plant. The State Pollution Control Board is required to grant consent

within a period of four months of receipt of an application, but may impose conditions relating to pollution

control equipment to be installed at the facilities. No person operating any industrial plant in any air pollution

control area is permitted to discharge the emission of any air pollutant in excess of the standards laid down by the

State Pollution Control Board. The penalties for the failure to comply with the above requirements include

imprisonment of up to six years and the payment of a fine as may be deemed appropriate. Under the Air Act, the

Central Board for the Prevention and Control of Water Pollution has powers, inter alia, to specify standards

for quality of air, while the State Board for the Prevention and Control of Water Pollution have powers, inter

alia, to inspect any control equipment, industrial plant or manufacturing process, to advise the State Government

with respect to the suitability of any premises or location for carrying on any industry and to obtain information

from any industry.

Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2016 ("Hazardous Waste

Rules")

The Hazardous Waste Rules regulate the management, treatment, storage and disposal of hazardous waste by

imposing an obligation on every occupier and operator of a facility generating hazardous waste to dispose of such

waste without harming the environment. Every occupier and operator of a facility generating hazardous waste must

obtain approval from the relevant state pollution control board. The occupier is liable for damages caused to the

environment resulting from the improper handling and disposal of hazardous waste and must pay any financial

penalty that may be levied by the respective state pollution control board.

Public Liability Insurance Act, 1991 ("Public Liability Act")

The Public Liability Act as amended imposes liability on the owner or controller of hazardous substances for any

damage arising out of an accident involving such hazardous substances. A list of hazardous substances covered by

the legislation has been enumerated by the Government by way of a notification. The owner or handler is also

required to take out an insurance policy insuring against liability under the legislation. The rules made under the

Public Liability Act mandates that the employer has to contribute towards the Environment Relief Fund, a sum

equal to the premium paid on the insurance policies. The amount is payable to the issuer.

Environment Protection Act, 1986 and Environment (Protection) Rules, 1986

The Environmental Protection Act, 1986 is an "umbrella" legislation designed to provide a framework for

coordination of the activities of various central and state authorities established under various laws. The potential

scope of the Act is broad, with "environment" defined to include water, air and land and the interrelationships which

exist among water, air and land, and human beings and other living creatures, plants, micro-organisms and property.

National Environmental Policy, 2006

The Policy seeks to extend the coverage, and fill in gaps that still exist, in light of present knowledge and

accumulated experience. This policy was prepared through an intensive process of consultation within the

Government and inputs from experts. It does not displace, but builds on the earlier policies. It is a statement of

India's commitment to making a positive contribution to international efforts. This is a response to our national

commitment to a clean environment, mandated in the Constitution in Articles 48 A and 51 A (g), strengthened by

judicial interpretation of Article 21. The dominant theme of this policy is that while conservation of environmental

resources is necessary to secure livelihoods and well-being of all, the most secure basis for conservation is to ensure

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that people dependent on particular resources obtain better livelihoods from the fact of conservation, than from

degradation of the resource. Following are the objectives of National Environmental Policy:

Enhancement of resources for Environmental Conservation

Conservation of Critical Environmental Resources

Intra-generational Equity: Livelihood Security for the Poor

Inter-generational Equity

Integration of Environmental Concerns in Economic and Social Development

Efficiency in Environmental Resource Use

Environmental Governance

II. Labour Legislations

Contract Labour (Regulation and Abolition) Act, 1970 ("CLRA")

CLRA regulates the employment of contract labour in certain establishments and provides for its abolition in

certain circumstances. It applies:

to every establishment which does not carry on intermittent / casual work in which 20 or more

workmen are employed on any day of the preceding 12 months as contract labour.

to e v e r y contractor who employ or employed on any data of the preceding 12 months, 20 or

more workmen.

Every establishment must, within the specified period, apply to the registering officer for registration of

the establishment and obtain a certificate of registration containing such particulars as may be prescribed.

Further, a contractor can only undertake or execute any work through contract labour under and in

accordance with a license issued in that behalf by the licensing officer. The license may contain

conditions including, in particular, conditions as to hours or work, fixation of wages and other essential

amenities in respect of contract labour. The license will be valid for the period specified therein. Every

contractor is duty-bound to provide and maintain supply of drinking water, canteens, rest-rooms latrines

and urinals, washing facilities, first-aid box in the prescribed manner for contract labour employed in

connection with the work of an Establishment to which the Act applies. If such amenities are not provided

by the contractor within the prescribed time, such amenities shall be provided by the principal employer of

the Establishment. Contractor shall be responsible for payment of wages to each worker employed by him

as contract labour within the prescribed period and in case he fails to do so, the principal employer of the

Establishment will be so responsible.

Payment of Wages Act, 1936

Payment of Wages Act, 1936 contains provisions as to the minimum wages that are to be fixed by

the appropriate Governments for the employees, fixation and revision for the minimum wages of the

employees, entitlement of bonus to the employees, fixing the payment of wages to workers and

ensuring that such payments are disbursed by the employers within the stipulated time frame and

without any unauthorized deductions.

Minimum Wages Act, 1948

The Minimum Wages Act, 1948 aims to make provisions for statutory fixation of minimum rates of wages

in scheduled employment wherein labour is not organized. It seeks to prevent the exploitation of

workers and protect their interest in the ‘ sweated industries’. Wage fixing authorities have been

guided by the norms prescribed by the Fair Wage Committee in the settlement of issues relating to

wage fixation in organized industries. It also contemplates the minimum wage rates must ensure not

only the mere physical needs of a worker which keeps them just above starvation level, but must ensure

for him and his family’s subsistence, and also to preserve his efficiency as a worker.

Child Labour (Prohibition and Regulation) Act, 1986

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The Child Labour (Prohibition and Regulation) Act, 1986 seeks to prohibit the engagement of children

in certain employments and to regulate the conditions of work of children in certain other employments.

It also prescribes hours and periods of work, holidays, the requirement of keeping a register, etc. for

the establishments falling under this act.

Payment of Gratuity Act, 1972 ("PG Act")

The PG Act was enacted with the objective to regulate the payment of gratuity, to an employee who

has rendered for his long and meritorious service, at the time of termination of his services. A terminal

lump sum benefit paid to a worker when he or she leaves employment after having worked for the

employer for a prescribed minimum number of years is referred to as "gratuity. The provisions of the PG

Act are applicable to all the factories. The Act provides that within 30 days of opening of the

establishment, it has to notify the controlling authority in Form A and thereafter whenever there is any

change in the name, address or change in the nature of the business of the establishment a notice in Form B

has to be filed with the authority.

The Employer is also required to display an abstract of the Act and the rules made there-under in Form U to

be affixed at the or near the main entrance. Further, every employer has to obtain insurance for his

Liability towards gratuity payment to be made under PG Act, with Life Insurance Corporation or any other

approved insurance fund.

Payment of Bonus Act, 1965

The Payment of Bonus Act, 1965 is applicable to every establishment employing 20 or more employees.

The said Act provides for payment of the minimum bonus to the employees specified under the Act. It

further requires the maintenance of certain books and registers such as the register showing

computation of the allocable surplus; the register showing the set on & set off of the allocable surplus

and register showing the details of the amount of Bonus due to the employees. Further it also requires

for the submission of Annual Return in the prescribed form (Form D) to be submitted by the employer

within 30 days of payment of the bonus to the Inspector appointed under the Act.

Equal Remuneration Act, 1979

The Equal Remuneration Act, 1979 provides for payment of equal remuneration to men and women

workers and for prevention discrimination, on the ground of sex, against female employees in the matters

of employment and for matters connected therewith. The act was enacted with the aim of state to provide

equal pay and equal work as envisaged under Article 39 of the Constitution.

Factories Act, 1948

The Factories Act came into force on April 01, 1949 and extends to the whole of India, including Jammu

and Kashmir. It has been enacted to regulate working conditions in factories and to ensure the provision

of the basic minimum requirements for safety, health and welfare of the workers as well as to regulate the

working hours, leave, holidays, employment of children, women, etc. It ensures annual leaves with

wages, provides additional protection from hazardous processes, additional protection to women workers

and prohibition of employment of children.

Industrial Disputes Act 1947

The Industrial Disputes Act 1947 lays down the machinery and procedure for investigation, settlement

and resolution of Industrial disputes in what situations a strike or lock-out becomes illegal and what

are the requirements for laying off or retrenching the employees or closing down the establishment.

When a dispute exists or is apprehended, the appropriate Government may refer the dispute to a

labour court, tribunal or arbitrator, to prevent the occurrence or continuance of the dispute, or a strike or

lock-out while a proceeding is pending. The labour courts and tribunals may grant appropriate relief

including ordering modification of contracts of employment or reinstatement of workmen.

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Industrial (Development and Regulation) Act, 1951

The development and regulation of certain industries are governed under the Industrial (Development

and Regulation) Act, 1951. For the purpose of advising on matters relating to development and

regulation, the Central Government may establish a council known as central advisory council. This

council shall have not more than 31 members including the chairman who shall be appointed by the

Central Government. Every industrial undertaking shall be registered within such period as the central

government may notify in this regard. The Central Government has direct power to assume management

or control of an industrial undertaking owned or for companies in liquidation.

The suits pertaining to this Act shall be tried by no court inferior to that of the presidency magistrate

or magistrate of first class. The Central Government has sole power to grant exemption in certain cases.

The First schedule to the Act mentions the list of industries to which the act applies.

Workmen’s Compensation Act, 1923

The Workmen‘s Compensation Act came into force on April 01, 1924. It aims at providing financial

protection to workmen and their dependents in case of accidental injury by means of payment of

compensation by the employers However, here the employer shall not be liable in respect of any injury that

does not result in the total or partial disablement of the workmen for a period exceeding 3 days in

respect of any injury not resulting in death, caused by an accident which was due to the reason that

workman was under the influence of drugs, or due to his willful disobedience of an order expressly given to

him, or a wilful removal or disregard of any safety device by the workmen, or when the employee has

contacted a disease which is not directly attributable to a specific injury caused by the accident or to the

occupation.

The Employees Provident Funds and Miscellaneous Provisions Act, 1952 ("Employees Provident Fund

and Miscellaneous Provisions Act")

The Employees’ Provident Funds and Miscellaneous Provisions Act is a social welfare legislation to

provide for the institution of Provident Fund, Pension Fund and Deposit Linked Insurance Fund for

employees working in factories and other establishments. The Act aims at providing social security and

timely monetary assistance to industrial employees and their families when they are in distress.

The Act is administered by the Government of India through the Employees' Provident Fund

Organization (EPFO). The following three schemes have been framed under the Act by the Central

Government:

a) The Employees' Provident Fund Schemes, 1952;

b) The Employees' Pension Scheme, 1995; and

c) The Employees' Deposit-Linked Insurance Scheme; 1976.

The Central Government has constituted Employees' Provident Funds Appellate Tribunal to exercise

the powers and discharge the functions conferred by Employees' Provident Funds and Miscellaneous

Provisions Act.

Employees State Insurance Act, 1948 ("ESI Act")

The ESI Act provides for certain benefits to employees in case of sickness, maternity and employment

injury. All employees in establishments covered by the ESI Act are required to be insured, with an

obligation imposed on the employer to make certain contributions in relation thereto. Employers of

factories and establishments covered under the ESI Act are required to pay contributions to the

Employees State Insurance Corporation, in respect of each employee at the rate prescribed by the Central

Government. Companies which are controlled by the Government are exempt from this requirement if

employees receive benefits similar or superior to the benefits prescribed under the ESI Act. In addition,

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the employer is also required to register itself under the ESI Act and maintain prescribed records and

registers

Maternity Benefit Act, 1951

The Maternity Benefit Act, 1951 provides for leave and right to payment of maternity benefits to

women employees in case of confinement or miscarriage etc. The act is applicable to every establishment

which is a factory, mine or plantation including any such establishment belonging to government and to every

establishment of equestrian, acrobatic and other performances, to every shop or establishment within the

meaning of any law for the time being in force in relation to shops and establishments in a state, in which ten

or more persons are employed, or were employed, on any day of the preceding twelve months; provided that

the state government may, with the approval of the Central Government, after giving at least two months‘

notice shall apply any of the provisions of this act to establishments or class of establishments, industrial,

commercial, agricultural or otherwise.

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

("SHWW Act")

The SHWW Act provides for the protection of women at work place and prevention of sexual harassment

at work place. The SHWW Act also provides for a redressal mechanism to manage complaints in this

regard. Sexual harassment includes one or more of the following acts or behavior namely, physical

contact and advances or a demand or request for sexual favors or making sexually colored remarks,

showing pornography or any other unwelcome physical, verbal or non-verbal conduct of sexual nature.

The SHWW Act makes it mandatory for every employer of a workplace to constitute an Internal

Complaints Committee which shall always be presided upon by a woman. It also provides for the

manner and time period within which a complaint shall be made to the Internal Complaints Committee

i.e. a written complaint is to be made within a period of 3 (three) months from the date of the last

incident. If the establishment has less than 10 (ten) employees, then the complaints from employees of

such establishments as also complaints made against the employer himself shall be received by the Local

Complaints Committee. The penalty for non-compliance with any provision of the SHWW Act shall be

punishable with a fine extending to ₹50,000.

III. Tax Related Legislations

The Goods and Services Tax Act, 2017 (“GST Act”)

The GST Act levies tax on supply of goods and services throughout India to replace multiple taxes levied

by the Central and State Governments on production, supply and sale of goods and providing of services in

India. The GST Act is applicable from July 1, 2017 and bounds together the Central Excise Duty,

Commercial Tax, Value Added Tax (VAT), Food Tax, Central Sales Tax (CST), Introit, Octroi,

Entertainment Tax, Entry Tax, Purchase Tax, Luxury Tax, Advertisement Tax, Service Tax, Customs

Duty, Surcharges. Under GST, goods and services are taxed under five different categories that are 0%,

5%, 12%, 18%, 28%. GST is levied on all transactions such as supply, transfer, purchase, barter, lease, or

import of goods and/or services. Transactions made within a single state are levied with Central GST

(CGST) by the Central Government and State GST (SGST) by the government of that state. For inter-

state transactions and imported goods or services, an Integrated GST (IGST) is levied by the Central

Government. GST is a consumption based tax, therefore, taxes are paid to the state where the goods or

services are consumed and not the state in which they were produced.

Income Tax Act, 1961 ("IT Act")

The IT Act is applicable to every company, whether domestic or foreign whose income is taxable under

the provisions of the IT Act or rules made thereunder depending upon its ‘Residential Status’ and

‘Type of Income’ involved. The IT Act provides for the taxation of persons resident in India on global

income and persons not resident in India on income received, accruing or arising in India or deemed to have

been received, accrued or arising in India. Every company assessable to income tax under the IT Act is

116

required to comply with the provisions thereof, including those relating to Tax Deduction at Source,

Advance Tax, Minimum Alternative Tax and like. Every such company is also required to file its

returns by September 30 of each assessment year.

Professional Tax

The professional tax slabs in India are applicable to those citizens of India who are either involved in

any profession or trade. The State Government of each State is empowered with the responsibility of

structuring as well as formulating the respective professional tax criteria and is also required to

collect funds through professional tax. The professional taxes are charged on the incomes of individuals,

profits of business or gains in vocations. The professional tax is charged as per the List II of the

Constitution. The professional taxes are classified under various tax slabs in India. The tax payable under

the State Acts by any person earning a salary or wage shall be deducted by his employer from the salary or

wages payable to such person before such salary or wages is paid to him, and such employer shall,

irrespective of whether such deduction has been made or not when the salary and wage is paid to such

persons, be liable to pay tax on behalf of such person and employer has to obtain the registration from the

assessing authority in the prescribed manner. Every person liable to pay tax under these Acts (other than a

person earning salary or wages, in respect of whom the tax is payable by the employer), shall obtain a

certificate of enrolment from the assessing authority.

IV. Intellectual Property Laws Trademarks Act, 1999

Trademarks Act, 1999

A trademark is used in relation to goods so as to indicate a connection in the course of trade between the

goods and a person having the right as proprietor or user to use the mark. The Trademarks Act, 1999,

governs the registration, acquisition, transfer and infringement of trademarks and remedies available

to a registered proprietor or user of a trademark. Registration is valid for a period of 10 years but

can be renewed in accordance with the specified procedure. As per the Trademarks (Amendment) Bill,

2009, Registrar of Trade Marks is empowered to deal with international applications originating from

India as well as those received from the International Bureau and maintain a record of international

registrations. It also removes the discretion of the Registrar to extend the time.

The Copyright Act, 1957 ("The Copyrights Act")

The Copyright Act governs copyright protection in India. Under the Copyright Act, a copyright may subsist

in original literary, dramatic, musical or artistic works, cinematograph films, and sound recordings.

While copyright registration is not a prerequisite for acquiring or enforcing a copyright, registration

creates a presumption favoring the ownership of the copyright by the registered owner. Copyright

registration may expedite infringement proceedings and reduce delay caused due to evidentiary

considerations. Once registered, the copyright protection of a work lasts for 60 years. The remedies

available in the event of infringement of copyright under the Copyright Act include civil proceedings for

damages, account of profits, injunction and the delivery of the infringing copies to the copyright owner.

The Copyright Act also provides for criminal remedies including imprisonment of the accused and the

imposition of fines and seizures of infringing copies.

The Companies Act, 2013 (“CA 2013”)

The Companies Act, 2013 has been introduced to replace the existing Companies Act, 1956 in a

phased manner. The Act primarily regulates the formation, financing, functioning and winding up of

companies. The CA 2013 prescribes regulatory mechanism regarding all relevant aspects, including

organizational, financial and managerial aspects of the company. It plays a fundamental role in

protecting the investors and the shareholders and balances it with different aspects of company

autonomy. The Ministry of Corporate Affairs has also issued Rules complementary to the Act,

117

establishing the procedure to be followed by the companies in order to comply with the substantive

provisions of the CA 2013.

The Indian Contract Act, 1872

The Indian Contract Act, 1872 codifies the way in which a contract maybe entered into, execution,

implementation of the provisions of a contract and effects of breach of contract. A person is free to contract

on any terms he chooses. The Contract Act consists of limiting factors subject to which a contract will be

entered into, executed and breach enforced. It contains framework of rules and regulations that govern

formation and performance of contract.

The Specific Relief Act, 1963

The Specific Relief Act, 1963 is complimentary to the provisions of the Contract Act and the Transfer

of Property Act, as it applies to both movable property and immovable property. It applies in cases

where the Court can order specific performance of a contract. Specific relief can be granted only for

purpose of enforcing individual civil rights and not for the mere purpose of enforcing a civil law.

Specific performance' means Court will order the party to perform his part of agreement, instead of

imposing on him any monetary liability to pay damages to other party.

The Transfer of Property Act, 1882

The Transfer of Property Act, 1882 as amended, establishes the general principles relating to transfer

of property in India. It forms a basis for identifying the categories of property that are capable of

being transferred, the persons competent to transfer property, the validity of restrictions and conditions

imposed on the transfer and the creation of contingencies and vested interest in the property. It also

provides for the rights and liabilities of the vendor and purchaser in a transaction of sale of land.

The Competition Act, 2002

The Competition Act, 2002 is an act to prevent practices having adverse effect on competition, to promote

and sustain competition in markets, to protect interest of consumer and ensure freedom of trade in India.

The act deals with the prohibition of agreements and anti-competitive agreements. No enterprise or group

shall abuse the dominant position in various circumstances as mentioned in the Act. The prima facie duty

of the Competitive Commission of India ("CCI") is to eliminate practices having adverse effect on

competition, promote and sustain competition, protect interest of consumer and ensure freedom of

trade. The CCI shall issue notice to show cause to the parties to combination calling upon them to respond

within 30 days in case it is of the opinion that there has been appreciable adverse effect on the

competition of India. In case a person fails to comply with directions of CCI and the Director General, he

shall be punishable with a fine which may exceed to ₹ 1 lakh for each day during such failure subject to

maximum of ₹ 1Crore.

The Consumer Protection Act, 1986

The Consumer Protection Act aims at providing better protection to the interests of consumers and for

that purpose makes provisions for the establishment of authorities for the settlement of consumer

disputes. The Consumer Protection Act provides a mechanism for the consumer to file a complaint

against a trader or service provider in cases of unfair trade practices, restrictive trade practices, defects

in goods, deficiency in services; price charged being unlawful and goods being hazardous to life and safety

when used. The Consumer Protection Act provided for a three tier consumer grievance redressal

mechanism at the national, state and district levels.

The Registration Act, 1908

The Registration Act, 1908, as amended, has been enacted with the objective of providing public notice of

the execution of documents affecting, inter alia, the transfer of interest in immovable property. The purpose

118

of the Registration Act is the conservation of evidence, assurances, title and publication of documents and

prevention of fraud. It details the formalities for registering an instrument. Section 17 of the Registration

Act identifies documents for which registration is compulsory to bring the transaction to effect and

includes, among other things, any non-testamentary instrument which purports or operates to create,

declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether

vested or contingent, in any immovable property of the value of one hundred rupees or more, and a lease

of immovable property for any term exceeding one year or reserving a yearly rent.

The Indian Stamp Act, 1899

Under the Indian Stamp Act, 1899 as amended stamp duty is payable on instruments evidencing a transfer

or creation or extinguishment of any right, title or interest in immovable property. Stamp duty must be paid

on all instruments specified under the Stamp Act at the rates specified in the schedules to the Stamp

Act. The applicable rates for stamp duty on instruments chargeable with duty vary from State to State.

The Foreign Exchange Management Act, 1999

The Foreign Exchange in India is primarily governed by the provisions of FEMA which relates to

regulations primarily by the RBI and the rules, regulations and notifications thereunder, and the policy

prescribed by the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry,

Government of India. As laid by the FEMA Regulations no prior consent and approvals are required from

the Reserve Bank of India for Foreign Direct Investment under the ‘automatic route’ within the

specified sectoral caps. In respect of all industries not specified as FDI under the automatic route, and

respect of investment in excess of specified sectoral limits under the automatic route, consent may be

required from FIPB and/or the RBI. The RBI in exercise of its powers under FEMA, has notified the

Foreign Exchange Management (Transfer or Issue of Security by Person Resident Outside of India)

Regulations, 2000 ("FEMA Regulations") to prohibit, restrict or regulate, transfer by or issue security to a

person resident outside India and the Foreign Exchange Management (Export of Good and Service)

Regulations, 2000 for regulations on exports of goods and services.

Foreign Trade (Development & Regulation) Act, 1992

The Foreign Trade (Development & Regulation) Act, 1992 provide for regulation and development of

foreign trade by facilitating imports into and augmenting exports from India and for matters connected

therewith or incidental thereto. The Import-Export code number and license to import or export includes a

custom clearance permit and any other permission issued or granted under this Act. The Export and

Import policy, provision for development and regulation of foreign trade shall be made by the

Central Government by publishing an order. The Central Government may also appoint the Director

General for Foreign Trade (DGTF) for the purpose of import-export policy formulation. If any person

makes any contravention to law or commits any economic offence or import/exports in a manner

prejudicial to trade of India or to the interest of other person engaged in import or export then there

shall be no Import Export granted by the Director- General to such person and if in case granted then

shall remain suspended or cancelled. Provision of search and seizure of Code of Criminal Code, 1973

shall apply to every search and seizure under this Act. The EXIM Policy is a set of guidelines and

instructions set by the DGTF in matters related to the export and import of goods in India. This policy is

regulated under the said Act. The DGTG is the main governing body in matters related to the EXIM

Policy.

VII. Industrial Policy of Relevant State

Industry Policy for the State of Himachal Pradesh

Industrial Policy of Relevant State Himachal Pradesh Industrial Policy 2013 The policy aims at achieving

average annual industrial growth rate of 15%, aligned with the target of 9% per annum growth in state

GDP. The Policy intends to clearly enunciate the State Government’s vision, approach and strategy for

“Retention” of existing industry and for the “promotion” of new investments in the manufacturing and

119

allied sectors in the state. The Policy aims at achieving an average annual industrial growth rate of 15% per

annum, aligned with the target of 9% per annum annual growth in state GDP as envisaged in the 12th Five

Year Plan, with the manufacturing sector contributing at least 25% of the state GDP by the year 2022.

120

OUR HISTORY AND OTHER CORPORATE MATTERS


Registrar of Companies, Jalandhar as a Private Limited company under the provisions of the Companies Act, 1956.

Subsequently, our Company was converted into a Public Limited Company and the name of our Company was

changed to ‘Preet Remedies Limited’. A fresh certificate of incorporation consequent upon conversion to public

limited Company was issued by the Registrar of Companies, Chandigarh on February 06, 2018. The Corporate

Identification Number of our Company is U24230CH2005PLC027954.

The promoters of our Company are Mr. Sanjeev Kumar Singal, Mr. Satish Kumar, Mr. Harpeet Singh and Mr.

Sanjay Dhir.

Changes in our Registered Office:

Our Company’s Registered Office is currently situated at Plot No 194-195, Third Floor Industrial Area Phase II,

Chandigarh-160 002.

Details of changes in the address of the Registered Office of our Company are set forth as under:

Date of Change From To

08.12.2014 Plot No. 655, Industrial Area Phase II,

Chandigarh

Plot No 194-195, Third Floor, Industrial

Area Phase II, Chandigarh

.

Main Objects of our Company

The Object Clauses of the Memorandum of Association of our Company enable us to undertake the activities for

which the funds are being raised in the present Issue. Furthermore, the activities of our Company which we have

been carrying out until now are in accordance with the objects of the Memorandum. The main Objects of our

Company are:

1. To carry on the business of manufacturers, producers, importers, exporters, sellers of all kinds of drugs,

medicines, pharmaceuticals, Ayurvedic, Unani, Homeopathic, Basic and Patented Drugs.

2. To manufacture, buy, sell, exchange, import, export and deal in laboratory and scientific chemicals, oils, acids,

soaps, detergents, cosmetics, perfumes, plants, reagents.

Changes in the Memorandum of Association

The following changes have been made in the Memorandum of Association of our Company since inception:

Date of

Shareholders

Resolution

Particulars

22.07.2005 Authorized Capital of the Company increased from ₹ 10,00,000 divided into 1,00,000

Lakhs Equity Shares of ₹10 each to ₹50,00,000 divided into 5,00,000 Equity Shares of ₹10

each

06.12.2006 Authorized Capital of the Company increased from ₹50,00,000 divided into 5,00,000

Equity Shares of ₹10 each to ₹1,00,00,000 divided into 10,00,000 Equity Shares of ₹10

each

17.07.2007 Authorized Capital of the Company increased from ₹1,00,00,000 divided into 10,00,000

Equity Shares of ₹10 each to ₹5,00,00,000 divided into 50,00,000 Equity Shares of ₹10

each

27.01.2018 Conversion of Private Company into Public Company

20.03.2018 Authorized Capital of the Company increased from ₹ 5,00,00,000 divided into 50,00,000

Equity Shares of ₹10 each to ₹10,00,00,000 divided into 1,00,00,000 Equity Shares of ₹10

each

121

Major Events and Milestones:

The table below sets forth the key events in the history of our Company:

Year Particulars

2005 Incorporate as “Preet Remedies Private Limited”

2005 Granted Manufacturing Drug License

2005 Plant situated at Plot No. 184, and Plot no 185 HPSIDC Industrial Area Baddi, Distt Solan, HP started

operating

2006 Acquisition Plot No 186 HPSIDC Industrial Area Baddi, Distt Solan, HP for business expansion

Purpose.

2008 Company crossed the ₹ 50 Crores turnover mark

2009 Acquired Plot No. 183 HPSIDC Industrial Area Baddi, Distt Solan, HP for business expansion purpose.

2011 Goods Manufacturing Practices (WHO Technical Reports 37 Series 908 – Thirty Seventh report 2003

published by WHO)

Certifications, Awards and Recognitions

We have received the following certifications, awards and recognitions for achieving and maintaining high standards

in various aspects of our business:

Year Certification/Award

2014 NSIC – CRISIL Performance and Credit Rating for “High credit Worthiness in relation to other MSEs”.

2018 Certificate of Appreciation for Generous contribution towards Chief Minister Relief Fund (Himachal

Pradesh)

Corporate Profile of our Company

For details regarding the description of our activities, including details of our business, geographical presence,

growth, competition, products, technology, and managerial competence, please see sections entitled “Our

Business”, “Our Management” and “Industry Overview” beginning on pages 93, 123 and 83 respectively.

Revaluation of Assets

Our Company has not Revalued any of its assets till date.

Holding Company of our Company

Our Company has no holding company as on the date of filing of this Prospectus.

Subsidiary of our Company

There is no subsidiary of our Company as on the date of filing of this Prospectus.

Injunctions or Restraining Orders

There are no injunctions/ restraining orders that have been passed against our Company as on the date of filling of

this Prospectus.

Details regarding Acquisition of Business/Undertakings, Mergers, Amalgamation etc.

There are no mergers, amalgamation, etc. with respect to our Company and we have not acquired any

business/undertakings as on the date of this Prospectus.

122

Capital raising activities through Equity or Debt

For details of the equity capital raised by our Company, please refer to the chapter titled “Capital Structure”

beginning on page 63 of this Prospectus. Our Company has not carried out any debt issuances or raised any long

term debt except as describe in financial statements since incorporation till date of filling of this Prospectus. .

Changes in the Management

For details of change in Management Please refer to “Our Management” on page 123 of this Prospectus.

Shareholders Agreements

Our Company has not entered into any shareholders agreement as on date of filing of this Prospectus.

Strikes and Lock-Outs

Our Company has, since incorporation, not been involved in any labour disputes or disturbances including strikes

and lockouts till date. As on the date of this Prospectus, our employees are not unionized.

Other Agreements

Our Company has not entered into any specific or special agreements except that have been entered into in ordinary

course of business as on the date of filing of this Prospectus.

Collaboration

Our Company has not entered into any collaboration with any third party as per regulation (VIII) B (1) (c) of part A

Schedule VIII of SEBI (ICDR) Regulations, 2009, as on the date of filling of this Prospectus.

Strategic Partner

Our Company does not have any strategic partner as on the date of filing of this Prospectus.

Financial Partner

Our Company does not have any financial partner as on the date of filing of this Prospectus.

Defaults or Rescheduling of Borrowings with Financial Institutions or Banks

There have been no defaults or rescheduling of borrowings with financial institutions or banks as on the date of this

Prospectus.

Number of Shareholders

Our Company has seven (7) shareholders as on date of this Prospectus.

Time and Cost overruns

Our Company has implemented projects but has not, experienced any time or cost overrun in relation thereto.

Guarantees provided by our Promoters

Our Promoters have given guarantees to bank that are outstanding as on the date of filing of this Prospectus. For

details of Guarantees provided by our Promoters Please refer to “Risk Factors” on page 15 of this Prospectus.

123

OUR MANAGEMENT

Board of Directors

As per the Articles of Association, our Company is required to have not less than three (3) Directors and not more

than Fourteen (14) Directors. Our Company currently has Eight (8) Directors on Board. The following table sets

forth current details regarding our Board of Directors:

Name, Father’s Name, Address, Occupation, Nationality

Designation, Term & DIN

Age Other Directorships

Mr. Sanjeev Kumar Singal

Father’s Name: Mr. Hari Chand

Designation: Managing Director

Term: For a term of 5 years with effect from June 27, 2018

Address: 2629, Sector 70, Mohali – 160 071

Occupation: Business

Date of Appointment: March, 15 2006

PAN: ACSPK 6038 N

Nationality: Indian

DIN: 01154896

49 1. Zenlabs Ethica Limited

2. Oasis Pharma and Phytomolecules

Private Limited

3. Ultra Chiron Healthcare Private

Limited

4. Ultra Chiron Pharmaceuticals Pvt.

Ltd.

5. Quadriga Biotech Private Limited

6. Zen Labs India Private Limited

7. Quixotic Pharma Private Limited

Mr. Harpreet Singh

Father’s Name: Mr. Jasbir Singh Kalra

Designation: Executive Director

Term: Liable to Retire by Rotation

Address: House No. 2649 Sector-69, S.A.S. Nagar,

Mohali – 160 062


Date of Appointment: February, 10 2005

PAN: ABEPK 4363 P

Nationality: Indian

DIN: 00834180



Private Limited



124

Mr. Satish Kumar

Father’s Name: Mr. Badri Prasad

Designation: Executive Director


Address: House No. 1102, Sector 44 B,

Chandigarh – 160 047

Date of Appointment: December, 06 2006


PAN: AAQPK 2914 F

Nationality: Indian

DIN: 00763060



Private Limited

3. SMD Chemi-Pharma Private

Limited

4. Unispeed Pharmaceuticals Private

Limited



7. Hexford Laboratories Private

Limited

8. Galen Infrastructure Limited

Mr. Sanjay Dhir

Father’s Name: Mr. Amar Nath Dhir

Designation: Non-Executive Director


Address: H.No. 1042, Sector 36-C,

Chandigarh 160 036


Date of Appointment: May, 01 2009

PAN: AFFPD 9015 E

Nationality: Indian

DIN: 02452461



Private Limited


4. Hexford Laboratories Private

Limited


Mr. Swapan Chakraborty

Father’s Name: Mr. Monigopal Chakaborty

Designation: Additional Director

Term: Upto Next Annual General Meeting

Address: 46/2, Satyen Roy Branch Road, Behala,

Kolkata- 700 034


Date of Appointment: April, 07 2018

PAN: ALKPC7657C

56 1. Oasis Pharma and Phytomolecules

Private Limited

125

Nationality: Indian

DIN: 07184333

Mr. Rajesh Shrivastava

Father’s Name: Biswanath Shrivastava

Designation: Independent Non-Executive Director

Term: Appointment as Independent Non-Executive

Director

Address: B103, Yogeshwar Co. Op. Society, Novi no

Tarsali Road Makarpura, Baroda 390 010

Date of Appointment: June, 08 2018


PAN: ANGPS4594J

Nationality: Indian

DIN: 00155198

54

Mr. Ashok Kumar Gupta

Father’s Name: Balwant Rai Gupta

Designation: Independent Non-Executive Director

Term: Appointed as Independent Non-Executive Director

for a period of 5 Years

Address: 252, Kamla Nehru Colony, Near Bibiwala

Chowk, K Bathinda 151 001



PAN: ABGPG3845A

Nationality: Indian

DIN: 07330108


Ms. Manju Kandhari

Husband Name: Rajat Kandhari

Designation: Non-Executive Independent Director

Term: Appointed as Non-Excutive Independent Director

42

126

Note:

1) None of the above mentioned Directors are on the RBI List of willful defaulters.

2) Further, none of our Directors are or were directors of any company whose shares were (a) suspended from

trading by stock exchange(s) for more than 3 months during the five years prior to the date of filing this

Prospectus or (b) delisted from the stock exchanges.

3) None of the Promoters, Persons forming part of our Promoter Group, Directors or persons in control of our

Company, has been or is involved as a promoter, director or person in control of any other company, which is

debarred from accessing the capital market under any order or directions made by SEBI or any other regulatory

authority.

Brief Biographies of our Directors

Mr. Sanjeev Kumar Singal, aged 49 years is the Managing Director of the company. Mr. Sanjeev Kumar Singal

hold Diploma in Pharmacy and is a successful entrepreneur for more than 24 years. He has extensive industrial

experience in the Pharmaceuticals and healthcare Industries. He heads the legal, financial and corporate image of the

company. He is prime movers for various strategic initiatives and growth plans of the company. Before Promoting

Preet Remedies, Mr. Sanjeev Kumar Singal, was associated with Ultra Chiron Pharmaceuticals since 1993 as a

director.

Mr. Harpreet Singh, aged 50 years, is founder promoter and Executive Director of Preet Remedies and has more

than 26 years of experience in the pharma and healthcare industries. Mr. Harpreet Singh alongwith Mr. Jasbir Singh

laid foundation stone of the company in the year 2005. Mr. Harpreet Singh is High School passed but his experience

and way of doing work is appreciable. Mr. Singh looks after the administration of the Personnel Department and the

overall management of the company. Before promoting Preet Remedies, Mr. Harpreet Singh, was associated with

Preet Plastics Industries, Precision Polymers and Preet Packing solution as a partner.

Mr. Satish Kumar, aged 59 Years is a promoter and Executive director having more than 26 years of experience in

Pharmaceuticals Industries. Mr. Satish Kumar is dedicated and hard-working entrepreneur. Mr. Satish Kumar joined

the company as a Director in December 2006 but he was closely connected to the company since inception. Mr.

Satish Kumar is High School passed and deals in procurement of raw materials, production and specialist in the field

of packaging. Before joining Preet Remedies, Mr. Satish Kumar was associated with Smd Chemi-Pharma and Shiva

Traders.

Mr. Sanjay Dhir, aged 47 years, is a very dynamic and talented. Mr. Sanjay Dhir joined the company as a Director

in May 2009 but his wife Mrs. Himjyoti was associated with the company since inception. Mr. Sanjay Dhir hold

bachelor degree in Pharmacy, Diploma in Project management in Pharmaceuticals, Diploma in Pharmaceutical

Import and Export management, Diploma in Pharmaceutical Production management. Mr. Sanjay Dhir has more

for a period of 5 years

Address: 186, Block 12, Mohali Employees Co-Operative

Society, Sector 68, S.A.S. Nagar, Mohali 160 062



PAN: EEBPK5058D

Nationality: Indian

DIN: 08132304

127

than 22 years of experience in handling the sales, marketing and advertising related matters. Before joining Preet

remedies Mr. Sanjay Dhir, was associated with Multi-national company as Sales and Marketing head.

Mr. Swapan Chakraborty, aged 56, is a very experienced Director in Preet Remedies. Mr. Swapan Chakraborty is

B Pharma and Diploma in Chemical process, Instrumentation & Control. Mr. Swapan Chakraborty joined the

company for long-term commitment. Mr. Chakraborty looks after the overall production and other related matters in

Baddi plant.

Mr. Rajesh Shrivastava, aged 54 years, is having about 30 years of experience in Pharma and allied Industries. Mr.

Shrivastava is an experienced Independent Director of the company. He holds a Master Degree in Chemistry. He

also has vast experience of NABL, WHO and others Regulatory. Mr. Shrivastava has good command quality control

and product development. His overall experience is very beneficial for the growth of the company.

Mr. Ashok Kumar Gupta aged 66 years, is an Independent Director of the company. He is very senior and

experienced Director and has more than 25 years’ experience in the field of Accounts. He is retired from Punjab

Government as Accountant. Mr. Ashok Kumar Gupta is a dedicated and hardworking person. He joined the

company in June, 2018. He holds a bachelor's Degree in Arts and his presence on the Board is of great benefit to the

company.

Mrs. Manju Kandhari, aged 42 years, is a growth-oriented personality. She is a graduate and has more than 10

years of experience in advertising business. She is a self-employed and run her own business in advertising field.

Confirmations

There are no arrangements or understanding with major shareholders, customers, suppliers or any other entity,

pursuant to which any of the Directors or Key Management Personnel were selected as a Director or member of the

senior management.

The Directors of our Company have not entered into any service contracts with our Company which provides for

benefits upon termination of employment.

None of the Directors is or was a director of any listed company during the last five years preceding the date of

filing of this Prospectus, whose shares have been or were suspended from being traded on the BSE or the NSE,

during the term of their directorship in any such Company.

None of the Directors is or was a director of any listed company which has been or was delisted from any

recognized stock exchange in India during the term of their directorship in such Company.

Nature of Family Relationship among Directors

None of our Directors are relative among themselves.

Borrowing Powers of the Board

In accordance with the Articles of Association and pursuant to the EGM of our Company held on March 20, 2018,

the Board is authorised to borrow money, mortgage, hypothecate and/or charge all of our Company’s immovable

and movable properties, present and future, in such sum form or manner as the Board may think fit for securing

loans already obtained or that may be obtained from our Company’s banker or any other banks, financial institution

or any other lending institutions or persons, provided that the total amount of money or monies so borrowed (apart

from temporary loans obtained or to be obtained from our Company’s bankers in the ordinary course of business),

by our Company shall not, at any time, exceed the ₹ 5,000 Lakhs.

Remuneration to our Directors

Details of remuneration paid to our Directors during FY 2017-2018 are set forth in the table below:

128

Sr. No. Name of Director Remuneration (₹ in Lakhs)

1) Mr. Harpreet Singh 30.00

2) Mr. Satish Kumar 22.80

3) Mr. Sanjay Dhir 27.60

Terms of Appointment in FY 2018-19 of our Directors

Name Mr. Harpreet Singh

Designation Executive Director

Term Liable to Retire by Rotation

Remuneration 30.00 Lakh per annum (including Perquisites)

Name Mr. Satish Kumar

Designation Executive Director

Term Liable to Retire by Rotation


Name Mr. Swapan Chakraborty

Designation Additional Director

Term Upto Next Annual General Meeting


There is no definitive and /or service agreement that has been entered into between our Company and the Directors

in relation to their appointment.

Non-Executive Directors

Currently, non–executive Directors are not being paid any remuneration apart from payment of sitting fees. We also

confirm that no remuneration being paid to Independent Directors apart from payment of sitting fees.

Shareholding of Directors in our Company

Other than the following, none of our Directors holds any Equity Shares as of the date of filing this Prospectus:

Name of Director Number of Equity Shares held Percentage of pre-Issue

capital

Mr. Satish Kumar 8,88,000 14.80%

Mr. Harpreet Singh 9,04,000 15.07%

Mr. Sanjeev Kumar Singal 16,84,000 28.07%

Mr. Sanjay Dhir 8,00,000 13.33%

TOTAL 42,76,000 71.27%

Our Directors do not hold any outstanding vested options, pursuant to the employee stock option scheme

implemented by our Company.

Our Articles of Association do not require our Directors to hold any qualification shares.

Changes in our Board of Directors during the last three (3) years

The changes in the Directors during last three (3) years are as follows:

Name Date of Appointment/

Change/Cessation Reason

Mr. Swapan Chakraborty May 14, 2015 Appointed as Additional Executive Director

Mr. Swapan Chakraborty September 30, 2015 Change in Designation as an Executive

Director

129

Mr. Swapan Chakraborty January 27, 2017 Resigned due to personal reasons

Mr. Amit Sharma February 01,2017 Appointed as Additional Non-Executive

Director

Mr. Amit Sharma August 26, 2017 Resigned due to pre-occupations

Mr. Rajiv Sharma September 29, 2017 Change in Designation as an Executive

Director

Mr. Rajiv Sharma August 26, 2017 Appointed as Additional Non-Executive

Director

Mr. Rajiv Sharma March 28, 2018 Resigned due to Pre-occupation

Mr. Swapan Chakraborty April 07, 2018 Appointed as an Additional Director

Interest of Directors

Our Directors may be deemed to be interested to the extent of remuneration paid to them for services rendered as a

Director of our Company and reimbursement of expenses, if any, payable to them. For details of remuneration paid

to our Directors, please refer “Remuneration to our Directors” above.

Our Directors may also be regarded as interested to the extent of Equity Shares held by them in our Company, if

any, details of which have been disclosed above under the heading “Shareholding of Directors in our Company”. All

of our Directors may also be deemed to be interested to the extent of any dividend payable to them and other

distributions in respect of the Equity Shares.

Our Directors may also be interested to the extent of Equity Shares, if any, held by them or held by the entities in

which they are associated as promoters, directors, partners, proprietors or trustees or held by their relatives or that

may be subscribed by or allotted to the companies, firms, ventures, trusts in which they are interested as promoters,

Directors, partners, proprietors, members or trustees, pursuant to this Issue.

Except as stated in the chapter titled “Related Party Transactions” on page 149 of this Prospectus, our Directors do

not have any other interest in the business of our Company.

Bonus or Profit Sharing Plan for our Directors

None of our Directors are a party to any bonus or profit sharing plan.

Corporate Governance

The provisions of the Listing Regulations with respect to corporate governance will also be applicable to us

immediately upon the listing of our Equity Shares with the Stock Exchange. We are in compliance with the

requirements of the applicable regulations, including the SEBI (LODR) Regulations, the SEBI (ICDR) Regulations

and the Companies Act, 2013 in respect of corporate governance including constitution of the Board and committees

thereof.

Our Board has been constituted in compliance with the Companies Act and SEBI (LODR) Regulations, to the extent

applicable. Our Board functions either as a full board or through various committees constituted to oversee specific

functions. In compliance with the requirements of the Companies Act and the SEBI (LODR) Regulations, to the

extent applicable our Board of Directors consists of Eight Directors (including one woman Director).

Committees of our Board

Our Board has constituted following committees in accordance with the requirements of the Companies Act and

SEBI Listing Regulations:

1.) Audit Committee;

2.) Nomination and Remuneration Committee;

3.) Stakeholders’ Relationship Committee;

130

Details of each of these committees are as follows:

1.) Audit Committee;

Our Audit Committee was constituted pursuant to resolution of our Board dated May 25, 2018. The Audit

Committee comprises of the following:

Sr. No. Name of the Director Status in

Committee

Nature of Directorship

1) Mr. Ashok Kumar Gupta Chairperson Independent Non-Executive Director

2) Mr. Sanjeev Kumar Singal Member Managing Director

3) Mr. Rajesh Shrivastava Member Independent Non-Executive Director

The Company Secretary shall act as the secretary of the Audit Committee.

The scope, functions and the terms of reference of the Audit Committee is in accordance with the Section 177 of the

Companies Act, 2013 and Regulation 18 (3) of Securities and Exchange Board of India (Listing Obligations and

Disclosure Requirements) Regulations, 2015 read with Schedule II Part C SEBI (LODR) Regulations, 2015

The role of the audit committee shall include the following:

(a.) oversight of the listed entity’s financial reporting process and the disclosure of its financial information to

ensure that the financial statement is correct, sufficient and credible;

(b.) recommendation for appointment, remuneration and terms of appointment of auditors of the listed entity;

(c.) approval of payment to statutory auditors for any other services rendered by the statutory auditors;

(d.) reviewing, with the management, the annual financial statements and auditor's report thereon before submission

to the board for approval, with particular reference to:

(i.) matters required to be included in the director’s responsibility statement to be included in the board’s report

in terms of clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013;

(ii.) changes, if any, in accounting policies and practices and reasons for the same;

(iii.) major accounting entries involving estimates based on the exercise of judgment by management;

(iv.) significant adjustments made in the financial statements arising out of audit findings;

(v.) compliance with listing and other legal requirements relating to financial statements;

(vi.) disclosure of any related party transactions;

(vii.) modified opinion(s) in the draft audit report;

(e.) reviewing, with the management, the quarterly financial statements before submission to the board for approval;

(f.) reviewing,with the management, the statement of uses / application of funds raised through an issue (public

issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in

the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the

utilisation of proceeds of a public or rights issue,and making appropriate recommendations to the board to take

up steps in this matter;

(g.) reviewing and monitoring the auditor’s independence and performance, and effectiveness of audit process;

131

(h.) approval or any subsequent modification of transactions of the listed entity with related parties;

(i.) scrutiny of inter-corporate loans and investments;

(j.) valuation of undertakings or assets of the listed entity, wherever it is necessary;

(k.) evaluation of internal financial controls and risk management systems;

(l.) reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal

control systems;

(m.) reviewing the adequacy of internal audit function, if any, including the structure of the internal audit

department, staffing and seniority of the official heading the department, reporting structure coverage and

frequency of internal audit;

(n.) discussion with internal auditors of any significant findings and follow up there on;

(o.) reviewing the findings of any internal investigations by the internal auditors into matters where there is

suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the

matter to the board;

(p.) discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as

post-audit discussion to ascertain any area of concern;

(q.) to look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders

(in case of non-payment of declared dividends) and creditors;

(r.) to review the functioning of the whistle blower mechanism;

(s.) approval of appointment of chief financial officer after assessing the qualifications, experience and background,

etc. of the candidate;

(t.) Carrying out any other function as is mentioned in the terms of reference of the audit committee.

The audit committee shall mandatorily review the following information:

(a.) management discussion and analysis of financial condition and results of operations;

(b.) statement of significant related party transactions (as defined by the audit committee), submitted by

management;

(c.) management letters / letters of internal control weaknesses issued by the statutory auditors;

(d.) internal audit reports relating to internal control weaknesses; and

(e.) the appointment, removal and terms of remuneration of the chief internal auditor shall be subject to review by

the audit commit.tee.

(f.) statement of deviations: (a) quarterly statement of deviation(s) including report of monitoring agency, if

applicable, submitted to stock exchange(s) in terms of Regulation 32(1). (b) annual statement of funds utilized

for purposes other than those stated in the offer document/prospectus/notice in terms of Regulation 32(7)

132

2.) Nomination and Remuneration Committee

The Nomination and Remuneration committee was Re-constituted by a resolution of our Board dated May 25, 2018.

The constitution of the Nomination and Remuneration committee presently is as follows:

Sr. No. Name of the Director Status Nature of Directorship

1. Mr. Rajesh Shrivastava Chairperson Independent Non-Executive Director

2. Mr. Sanjay Dhir Member Non-Executive Director

3. Mrs. Ashok Kumar Gupta Member Independent Non-Executive Director

The Company Secretary shall act as the secretary of the Nomination and Remuneration Committee.

The scope, functions and the terms of reference of the Nomination and Remuneration Committeeis in accordance

with the Section 178 of the Companies Act, 2013 read with Regulation 19 of the Securities Exchange Board of India

(Listing Obligations and Disclosure Requirements) Regulations, 2015.

The terms of reference of Nomination and Remuneration Committee shall include the following:

(a.) Formulation of the criteria for determining qualifications, positive attributes and independence of a director and

recommend to the board of directors a policy relating to, the remuneration of the directors, key managerial

personnel and other employees;

(b.) Formulation of criteria for evaluation of performance of independent directors and the board of directors;

(c.) Devising a policy on diversity of board of directors;

(d.) Identifying persons who are qualified to become directors and who may be appointed in senior management in

accordance with the criteria laid down, and recommend to the board of directors their appointment and removal.

(e.) Whether to extend or continue the term of appointment of the independent director, on the basis of the report of

performance evaluation of independent directors.

3.) Stakeholders’ Relationship Committee

The Stakeholders’ Relationship Committee was constituted by a resolution of our Board dated May 25, 2018 The

constitution of the Stakeholders’ Relationship committee is as follows:

Sr. No. Name of the Director Status Nature of Directorship

1. Mr. Rajesh Shrivastava Chairperson Independent Non-Executive Director

2. Mr. Satish Kumar Member Executive Director

3. Mr. Ashok Kumar Gupta Member Independent Non-Executive Director

The Company Secretary shall act as the secretary of the Stakeholders’ Relationship Committee.

This Committee is responsible for the redressal of the grievances of the security holders including complaints relate

to transfer of shares, non-receipt of annual report and non-receipt of dividend. The scope and function of the

Stakeholders’ Relationship Committee is in accordance with Section 178 of the Companies Act read with

Regulation 20 of the Listing Regulations.

Our Company has adopted the following policies:

1) Code of Conduct

2) Whistle Blower Policy & Vigil Mechanism

3) Related Party Transactions (RTP) Policy

4) Policy for Prevention of Sexual Harassment

133

ORGANIZATION STRUCTURE:

Our Key Managerial Personnel

Our Company is managed by its Board of Directors, assisted by qualified professionals, in the respective field of

administration / finance / distribution / marketing and corporate laws.

In addition to our Managing Director and Executive/Additional Directors, following key personnel assist the

management of our Company:

Mr. Sanjeev Kumar, aged 36 Years, is B. Com. and qualified Company Secretary (CS) having more than 5 years

of overall experience in the field of Corporate Laws, Listing and Finance. Mr. Sanjeev Kumar is Associate member

of the Institute of Company Secretaries of India (ICSI). Mr. Sanjeev Kumar is Company Secretary & Compliance

Officer of the Company, His function shall include report to Board about Compliances with provision of this Act

and he looks after the listing and company law compliances of the Company.

Mr. Sanjeev Kumar Kanwal, aged 38 Years, is B Com and qualified Chartered Accountant having more than 10

years of experience in the field of Accounting, finance and taxation. In the, past Mr. Kanwal was associated with

Reliance Industries Ltd, Mumbai from April 2008 to June 2010 and Al Maya Group, Dubai UAE from August 2010

to June 2017. Mr. Kanwal is very dedicated and hardworking. His overall experience is very beneficial for the

growth of the company.

For details of our Directors please refer chapter “Our Management” on page 123 of this Prospectus.

Status of Key Managerial Personnel

All our Key managerial personnel are permanent employees of our Company.

Family Relationship between Key Managerial Personnel

As on date, none of the key managerial personnel is having family relation with each other.

Board of Directors

Sanjeev Kumar (Managing Director)

Sanjeev Kumar Kanwal

(CFO)

Sanjeev Kumar

(Company Secretary & Compliance

Officer)

Swapan Chakraborty

(Additional Director)

Satish Kumar

(Executive Director)

Harpreet Singh

(Executive Director)

134

Arrangements and Understanding with major Shareholders

None of our key managerial personnel have been appointed on our Board pursuant to any arrangement with our

major shareholders, customers, suppliers or others.

Shareholding of the Key Managerial Personnel

Except Mr. Sanjeev Kumar Singal, Managing Director of the company holding 16,84,000 Equity Shares, as on date,

None of the Key Managerial Persons are holding Equity Shares of our Company.

Bonus or Profit Sharing Plan for the Key Managerial Personnel

There is no profit sharing plan for the key managerial personnel. Our Company makes bonus payments to the employees

based on their performances, which is as per their terms of appointment.

Loans to Key Managerial Personnel

There is no loan outstanding against key managerial personnel as on date of this Prospectus.

Interest of Key Managerial Personnel

Except Mr. Sanjeev Kumar Singal, Managing Director, Mr. Harpreet Singh, Executive Director, Mr. Sanjay Dhir,

Non Executive Director and Mr. Satish Kumar, Executive Director, the Key Managerial Personnel of our Company

do not have any interest in our Company other than to the extent of the remuneration or benefits to which they are

entitled to as per their terms of appointment and reimbursement of expenses incurred by them during the ordinary

course of business and to the extent of Equity Shares held by them in our Company, if any.

Except as disclosed in this Prospectus, none of our Key Managerial Personnel have been paid any consideration of

any nature from our Company, other than their remuneration.

Changes in Key Managerial Personnel of our Company during the Last Three (3) Years

For details of changes regarding our Promoter and Managing Director during last three years please refer chapter

titled “Our Management” on page 123 of this Prospectus.

Set forth below are the changes in the key managerial personnel of our Company during the last three (3) years.

Name Date of appointment Date of cessation Reason

Mr. Sanjeev Kumar Singal Appointed as Director

on March 15, 2005 and

Appointed as Managing

Director on June 27,

2018

June 26, 2023 Appointmed as Managing

Director

Mr. Sanjeev Kumar Kanwal July 1, 2018 - Appointmed as Chief

Financial Officer

Mr. Sanjeev kumar February 21, 2018 - Appointed as Company

Secretary

Employees Stock Option Scheme

Our Company does not have any Employee Stock Option Scheme/ Employee Stock Purchase Scheme as on the date

of filing of this Prospectus.

135

Payment or Benefit to our Officers

Except for the payment of normal remuneration for the services rendered in their capacity as employees of our

Company, no other amount or benefit has been paid or given within the two (2) preceding years or intended to be

paid or given to any of them.

Employees

The details about our employees appear under the Paragraph titled “Business Overview” beginning on page 93 of

this Prospectus.

136

OUR PROMOTERS/PROMOTER GROUP

The Promoters of our Company are:

1. Mr. Sanjeev Kumar Singal

Mr. Sanjeev Kumar Singal, aged 49 years is Promoter and Managing Director of the

company. He hold Diploma in Pharmacy from Punjabi University, Patiala in August,

1987. He has vast experience of around Two Decades in the Pharmaceuticals and

Healthcare Industries. He is prime movers for various strategic initiatives and growth

plans of the company. He is the head of Legal and Financial Department.

Address H.No. 2629, Sector 70, S.A.G. Nagar, Mohali – 160071

Occupation Business

Permanent Account

Number

ACSPK6038N

Passport Number Z3044308

Driving License

Number

PB-6520070230231

Aadhar Card Number 96541583 3956

2. Mr. Harpreet Singh

Mr. Harpreet Singh, aged 50 years, is a Promoter and Executive Director of the

Company. He has passed Matriculation from Punjab School Education Board in

December 1, 1984. He has more than Two Decades of experience in the Pharma and

Healthcare Industries. He looks after administration of the personnel Department &

overall Management of company.

Address House No. 2649 Sector-69, S.A.S. Nagar, Mohali - 160062

Occupation Business

Permanent Account

Number

ABEPK4363P

Passport Number H9566994

Driving License

Number

PB-6520080008082

Aadhar Card Number 4320 2954 2135

137

3. Mr. Sanjay Dhir

Mr. Sanjay Dhir, aged 47 years, is a Promoter and Non-Executive Director of the

Company. He has a degree in B Pharma from Mysor University. He has more than

Two Decades of experience in handling the marketing and brand building related

matters.

Address H.No. 1042, Sector 36-C, Chandigarh 160036

Occupation Business

Permanent Account

Number

AFFPD 9015 E


Driving License

Number

CH01 20140007739


4. Mr. Satish Kumar

Mr. Satish Kumar, aged 59 Years, is a Promoter and Executive Director of the

Company. He has passed Matriculation from Punjab School Education Board in

March, 1975. He has more than Two Decades of experience in Pharmaceuticals

Industries. He is handling the procurement, production and packaging areas of the

Company.

Address House No. 1102, Sector 44 B, Chandigarh – 160047

Occupation Business

Permanent Account

Number

AAQPK2914F


Driving License

Number

CH01 19830000270


Other Undertakings and Confirmations

Our Company undertakes that the details of Permanent Account Number, Bank Account Number and Passport

Number of the Promoters will be submitted to National Stock Exchange of India Limited, where the equity shares of

our Company are proposed to be listed at the time of submission of this Prospectus.

138

Common Pursuits of our Promoters

Except as mentioned in chapter titled “Group Companies / Entities” beginning on page 141,our Promoters have not

promoted any Group Companies/Entities which are engaged in the line of business similar to our Company as on the

date of this Draft Prospectus. For more details please refer Section titled “Our Promoters and Promoter Group”

&“Group Companies/Entities” on page 136 & 141 of this Draft Prospectus respectively. We shall adopt the

necessary procedures and practices as permitted by law to address any conflicting situations, as and when they may

arise.

Interest of the Promoters

Our promoters are interested in our Company to the extent they have promoted the Company, to the extent of their

shareholding for which they are entitled to receive the dividend declared, and other distribution in respect of Equity

Shares if any, by our Company. For details on shareholding of our Promoter in our Company, please refer sections

“Capital Structure” and “Our Management” on pages 63 and 123 respectively of this Prospectus.

Further, our Promoters who are also our Directors may be deemed to be interested to the extent of fees,

remuneration and/or reimbursement of expenses payable to them for services rendered to us in accordance with the

provisions of the Companies Act, 2013, terms of the Articles and their terms of appointment.

Except as stated herein and as stated in “Annexure-XXVI of Related Party Transactions” appearing under section

titled “Financial Information” of the Company beginning on page 151 of this Prospectus, we have not entered into

any contract, agreements or arrangements during the preceding two years from the date of this Prospectus in which

the Promoters are directly or indirectly interested and no payments have been made to them in respect of these

contracts, agreements or arrangements which are proposed to be made to them.

Interest in the property of Our Company

Our Promoter have no interest in any property acquired or proposed to be acquired by our company within the two

years from the date of this draft prospectus or any other transaction by our Company.

Payment amounts or benefit to our Promoters during the last two years

No payment has been made or benefit given to our Promoters in the two years preceding the date of this Draft

Prospectus except as mentioned / referred to in this chapter and in the section titled “Our Management”, “Financial

Information” and “Capital Structure” on page nos. 123, 151 and 63 respectively of this Draft Prospectus. Further as

on the date of this Draft Prospectus, there is no bonus or profit sharing plan for our Promoters.

Other ventures of our Promoters

Save and except as disclosed in the chapter titled “Our Promoters and Promoter Group” and “Group Companies /

Entities” beginning on page 136 & 141 respectively of this Prospectus, there are no ventures promoted by our

Promoters in which they have any business interests/ other interests.

Litigation details pertaining to our Promoters

For details on litigations and disputes pending against the Promoters and defaults made by the Promoters, please

refer to the section titled “Outstanding Litigations and Material Developments” on page 213 of this Prospectus.

Shareholding of the Promoters and Promoter Group in our Company

Except as disclosed in our chapter titled “Capital Structure”, none of the members of our Promoter Group hold any

Equity Shares as on the date of filing of this Prospectus.

139

Related Party Transactions

For the transactions with our Promoter Group entities, please refer to chapter titled “Related Party Transactions” on

page 149 of this Prospectus.

Except as stated in “Related Party Transactions” on page 149 of this Prospectus, and as stated therein, our

Promoters or any of the Promoter Group Entities do not have any other interest in our business.

Companies with which the Promoters are disassociated in the last three years

None of the Promoters have disassociated with any Company in last three years.

Our Promoter Group

In addition to the Promoters of our Company, the following individuals and entities form a part of the Promoter

Group:-

1.) Individuals forming part of Promoter Group

In terms of SEBI (ICDR) Regulations, the following immediate relatives, due to their relationship with our

Promoters are part of our Promoter Group in terms of Regulation 2(1) (zb) (ii) of SEBI (ICDR) Regulations:-

Promoter/Promoter

Group Sanjeev Kumar Singal Harpreet Singh Sanjay Dhir Satish Kumar

Father Late Sh. Hari Chand Sh. Jasbir Singh Kalra Sh. Amarnath Dhir Late Sh. Badri Parshad

Mother Late Smt. Amarti Devi Smt. Kulwant Kaur Smt. Krishna Dhir Late Smt. Sunheri Devi

Spouse Mrs. Harjinder Kaur Mrs. Amarpreet Kaur Mrs. Himjyoti Dhir Mrs. Saroj Singal

Brother(s) --

--

Mr. Rajiv Dhir Mr. Mohinder Paul

Singal

Mr. Gopal Chand Singal

Mr. Vishwamitter

Mr. Ashok Kumar Mr. Ramesh Kumar

Mr. Vijay Kumar

Sister(s) Mrs. Neelam Gupta, Mrs. Sunita Jain &

Mrs. Rajni Garg

Mrs. Daljinder Kaur Mrs. Kulwinder Kaur

Ms. Renu Walesha Ms. Ritu Sidana

Mrs. Urmil Gupta

Son Mitesh Kumar Singal & Sovesh Kumar Singal

Danishpreet Singh --

Mayank Singal Daman Singal

Daughter(s) -- Gurmehak Kaur Drishti Dhir

Srishti Dhir

--

Spouse Father Late Sh. Kartar Singh Late Sh Surjeet Singh Sh. Mohinder Singh Late Sh. Khushi Ram

Spouse Mother Late Smt. Surjeet Kaur Amrit Kaur Mrs. Surjeet Kaur Late Smt. Prakasho

Devi

Spouse Brother(s) Mr. Sukhwinder Singh

Mr. Rajwinder Singh

Late Sh. Kamaljit Singh --

Late Sh. Krishan

Kumar Garg

Late Sh. Manoj

Kumar Garg

Spouse Sister(s) Mrs. Balwinder Kaur Mrs. Narinder Kaur

-- Ms. Aman Preet Cheema

Mrs. Kanta Bansal

Mrs. Kamla Garg

Mrs. Krishna Garg

Late Mrs. Suresh

Singla

Mrs. Poonam Jindal

140

2.) Companies, Proprietary concerns, HUF‟s related to our promoters

Nature of Relationship Entity

Any Body Corporate in which ten percent or more of the equity share capital is held by promoter or an

immediate relative of the promoter or a firm or HUF in which promoter or any one or more of his

immediate relative is a member

*

Any Body corporate in which Body Corporate as provided above holds ten percent or more of the equity

share capital.

*

Any Hindu Undivided Family or firm in which the aggregate shareholding of the promoter and his

immediate relatives is equal to or more than ten percent.

*

*For details on our Promoter Group refer Chapter Titled “Our Group Companies/Entities” beginning on page 141 of

this Prospectus.

141

GROUP ENTITIES

In accordance with the provisions of the SEBI (ICDR) Regulations, for the purpose of identification of Group

Companies, our Company has considered companies as covered under the applicable accounting standards, i.e.

Accounting Standard 18 issued by the Institute of Chartered Accountant of India. Our Board vide a policy of

materiality has resolved that except as mentioned in the list of related parties prepared in accordance with

Accounting Standard 18, no other Company is material in nature.

1. ZenLabs Ethica Limited

2. Oasis Pharma and Phytomolecules Private limited

3. M/s. Quixotic Healthcare (Partnership Firm)

4. M/s. Alpha Products (Partnership Firm)

5. Ultra Chiron Healthcare Private Limited

6. Ultra Chiron Pharmaceuticals Private Limited

7. Unispeed Pharmaceuticals Private Limited

8. Zen labs India Private limited

9. M/s. Preet Plastic Industries (ProperiotershipConcern)

10. M/s. Ess Ess Gels (Partnership Firm)

11. Quadriga Biotech Private limited


13. SMD Chemi-Pharma Private Limited

Except as stated above, there are no companies/entites which are considered material by the Board of Directors of

Our Company to be identified as group companies/entities. As per sub clause C (2) of Clause (IX) of Schedule VIII,

we have provided the financial information of top 5 Listed/unlisted group companies/entities.

Listed Companies within our Promoter Group:

1. ZENLABS ETHICA LTD.

Corporate Information:

Zenlabs Ethica Limited was originally incorporated as Public Limited Company in name and style of Shri Lakhavi

Financial Services Limited vide Certificate of Incorporation dated July 20, 1993 bearing Registration Number 11-

72999. Subsequently, the name of the Company has been changed to Shri Lakhavi Infotech Limited vide Certificate

of Incorporation dated July 17, 2000. Further, the name of the company changed to Neelkanth Technologies Limited

vide Certificate of Incorporation dated April 27, 2007.

Thereafter, the registered office of the company changed from Maharashtra to Chandigarh under order received on

15th July, 2011. Furthermore, name of the company changed to Zenlabs Ethica Limited vide Certificate of

Incorporation dated January 22, 2016.

It has registered office at Plot No. 194-195, 3rd Floor, Industrial Area Phase II, Chandigarh, India. The current paid

up capital of Zenlabs Ethica Limited is Rs. 620 Lakhs. The Corporate Identification Number of Zenlabs Ethica

Limited is L74900CH1993PLC033112. The company is into the business of marketing and distribution of

pharmaceutical products.

142

Zenlabs Ethica Ltd. a wide global footprint. In collaboration with Zenlabs Pharmaceutical Inc, Canada, the company

develops & markets a wide range of quality, affordable and branded drugs. As a progressive company, it integrates p

people, processes and potentials towards the betterment of human life.

Zenlabs Ethica Ltd. is one of the leading marketing companies, which is marketing and exporting a wide range of

branded drugs including GIT disorders, Anti-Diabetics, Anti-Hypertensive Drugs, Anti-Infective, Soaps & Anti

Bacterial Drugs, Nutraceuticals and more.

Main Object of the Company: To deal with marketing and distribution of Pharmaceutical products.

The Equity Shares of the Company are currently listed on the BSE Limited and Ahmedabad Stock Exchange

Limited.

Board of Directors as on the date of this Draft Prospectus:

Sr.

No.

Name of the Director Designation

1) Mr. Satish Kumar Non- Executive Director

2) Mr. Harpreet Singh Non- Executive Director

3) Mr. Sanjeev Kumar Singal Managing Director and Chief Executive officer

4) Mrs. Him Jyoti Women Director

5) Mr. Sanjay Dhir Whole time Director and CFO

6) Mr. Narang Singh Independent Non-Executive Director

7) Mr. Ashok Kumar Gupta Independent Non-Executive Director

8) Mr. Chander Sheel Baweja Independent Non-Executive Director

9) Mr. Anurag Malhotra Independent Non-Executive Director

10) Mis. Harmilan Kaur Company Secretary and Compliance officer

SHARE HOLDING PATTERN AS ON MARCH 31, 2018 IS AS FOLLOWS:

Category of

shareholder

Nos. of

shareholders

No. of fully paid

up equity shares

held

Total nos. of

shares held

Shareholding as a %

of total no. of shares

Number of equity shares

held in dematerialized

form

(A) Promoter &

Promoter Group

5

41,90,589

41,90,589

67.59

41,90,589

(B) Public 865 20,09,425 20,09,425 32.41 16,26,225

(C1) Shares

underlying DRs

0

0

0

0

0

(C2) Shares held

by Employee

Trust

0

0

0

0

0

(C) Non

Promoter-Non

Public

0

0

0

0

0

Grand Total 870 62,00,014 62,00,014 100 58,16,814

Nature and Extent of Interest of Promoters: (As on 31st March, 2018)

143

Our Promoter Sanjeev Kumar Singal holds 6,46,626 Equity Shares of ₹ 10/- aggregating to 10.43% of the issued and

paid up share capital, Harpreet Singh also holds 6,46,626 Equity Shares of ₹10/- aggregating to 10.43% of the issued

and paid up share capital, Sanjay Dhir holds 6,46,884 Equity Shares of Rs. 10/- aggregating to 10.43% of the issued

and paid up share capital and Satish Kumar holds 3,42,378 Equity Shares of Rs. 10/- aggregating to 5.52% of the

issued and paid up share capital of Zenlabs Ethica Limited.

Financial Performance:

(₹ in lakhs)

Particulars March 31,

2017

March 31,

2016

March 31,

2015

Equity Share Capital 620 620 361.75

Reserves and Surplus (excluding revaluation

reserve if any)

(40.76)

(141.20)

(165.31)

Total Income 8123.76 1600.39 -

Profit / (Loss) after Tax 95.16 17.02 (6.64)

Earnings Per Share (Basic & Diluted) (in ₹.) 1.59 0.06 (0.18)

Net worth 579.24 478.80 196.43

Net Asset Value per equity share (in ₹.)

9.34 7.72 5.43

Mechanism for investor redressal grievance

All shares related matters namely transfer, transmission, transposition, nomination, dividend, change of name,

address and signature, registration of mandate and power of attorney, replacement, split, consolidation,

dematerialization and dematerialization of shares, issue of duplicate certificates, etc. are handled by Registrars and

Transfer Agent, Bigshare Services Private Limited.

There are no investor complaints pending as on the date of filing of this Draft Prospectus.

Other Confirmations:

1. Zenlabs Ethica Limited is not a sick company within the meaning of the Sick Industrial Companies (Special

Provisions) Act, 1995.

2. No application for winding up has been filed against the company.

3. No application has been made to ROC for striking off the name of Zenlabs Ethica Limited.

4. Zenlabs Ethica Limited is not prohibited from accessing the capital markets for any reasons by the SEBI or any

other authorities.

5. Zenlabs Ethica Limited has not failed to meet the listing requirements of recognized stock exchange in India or

abroad and no penalty, if any, including suspension of trading, has been imposed on Zenlabs Ethica Limited.

6. Zenlabs Ethica Limited equity shares are currently listed on BSE Limited only.

7. There are no adverse findings, as regards compliance with the securities laws against Zenlabs Ethica Limited.

Share price Information:

The details of the monthly high and low prices on the BSE during the preceding six months are as follows:

Month Year Monthly Low Monthly High

144

August, 2018 59.00 121.05

July, 2018 43.00 57.85

June, 2018 35.00 60.10

May, 2018 40.00 53.95

April, 2018 46.05 56.80

March, 2018 45.00 57.2

Unlisted Companies within our Promoter Group:

1. OASIS PHARMA AND PHYTOMOLECULES PRIVATE LIMITED


OASIS Pharma and Phytomolecules Private Limited incorporated on May 08, 2007 under the provisions of

Companies Act, 1956 and has its Registered Office at E-54, 3rd Floor, Vikas Marg, Laxmi Nagar, Delhi-110092. The

current paid up capital of the company is ₹171.75 Lakhs. The Corporate Identification Number is

U24100DL2007PTC163076.

OASIS Pharma and Phytomolecules Private Limited is a manufacturing concern which manufactures the bulk drugs

i.e.tablets, capsules, ointments etc. and also do jobwork for the various renowned companies like wockhard, Intas,

Cipla etc.

Board of Directors:

Sr. No. Name of the Director Designation

11) Mr. Satish Kumar Non-Executive Director

12) Mr. Harpreet Singh Executive Director

13) Mr. Sanjeev Kumar Singal Non Executive Director

14) Mr. Sanjay Dhir Managing Director

15) Mr. Swapan Chakraborty Additional Director

Shareholding as on date of this Prospectus:

Sr. No. Name of the Shareholder No of Shares held % of total Paid-up Capital

1) Preet Remedies Private Limited 741,098 43.15

2) Sanjeev Kumar Singal 136,000 7.92

3) Satish Kumar 72,000 4.19

4) Harpreet Singh 136,000 7.92

5) Sanjay Dhir 136,000 7.92

6) Harish Kumar Verma 412,864 24.04

7) Raspal Kaur 83,600 4.86

TOTAL 1,717,562 100.00

Audited financial information:

(₹ in Lakhs)


2017

March 31,

2016

March 31,

2015

145

Equity Share Capital 171.75 171.75 171.75


reserve if any)

(66.44)

(100.14)

(124.37)

Profit / (Loss) after Tax 33.70 24.22 (123.74)

Earnings Per Share (Basic & Diluted) (in ₹.) 1.96 1.41 (7.20)

Net worth 105.31 71.61 47.38

Net Asset Value per equity share (in ₹)

6.13 4.16 2.75

2. Ultra Chiron Healthcare Private Limited


Ultra Chiron Healthcare Private Limited formed on July 02, 2004 under the provision of Companies Act, 1956, and

having its registered office at 569, Phase-IX industrial Area-b, Mohali. The current paid up share capital of company

is 2,00,000. The Corporate Identification Number is U24230PB2004PTC027270

“Ultra Chiron Healthcare Pvt. Ltd.” are a renowned manufacturer of the premium quality range of Pharmaceutical

Tablets, Pharmaceutical Capsules, Pharmaceutical Injections, etc. Apart from this company also impart Pharma

PCD, Pharma Franchise and Pharma third Party Manufacturing Service

Board of Directors:


1. Mr. Naveesh Gupta Director

2. Mr. Sanjeev Kumar Director

3. Mrs. Harjinder Kaur Director

4. Mr. Mitesh Kumar Executive Director



8) Sanjeev Kumaer 15400 77.00

9) Harjinder Kaur 4600 23.00

TOTAL 20,000 100.00



2017

March 31,

2016

March 31,

2015



reserve if any)

27.85

25.18

23.10

Profit / (Loss) after Tax 2.66 2.07 2.36

Earnings Per Share (Basic & Diluted) (in ₹) 13.32 10.39 11.84

Net worth 29.85 27.18 25.10

Net Asset Value per equity share (in ₹)

149.25 135.93 125.54

146

3. SMD Chemi-Pharma Private Limited

SMD Chemi-Pharma Private Limited incorporated on November 05, 1998 under the provisions of Companies Act,

1956 and has its Registered office at 212- Aanarkali Complex, Jhandewalan Extension, New Delhi 110 055. The

Current Paid up capital of the company is ₹ 12,48,000\. The Corporate Identification Number is

U24117DL1998PTC096933.

SMD Chemi-Pharma Private Limited is a leading specialty pharmaceutical company that uses innovative science

and market insight to develop responsive products for a changing world.

Board of Directors:


1. Satish Kumar Director

2. Saroj Singal Director

3. Mayank Singal Executive Director

4. Daman Sing al Executive Director



1. Saroj Singal 35,800 28.68

2. Mayank Singal 25,000 20.03

3. Daman Singal 25,000 20.03

4. Satish Kumar 39,000 31.25

TOTAL 1,24,800 100.00



2017

March 31,

2016

March 31,

2015



reserve if any)

(12.29) (22.17) 0.56

Profit / (Loss) after Tax 9.88 (22.74) 1.96

Earnings Per Share (Basic & Diluted) (in Rs.) 7.92 0.00 1.57

4. M/s. QUIXOTIC HEALTHCARE

Partnership firm Information:

M/S Quixotic Healthcare is a partnership firm formed on 03.04.2006 under Partnership Act, 1932. Its registered is

at Plot no. 194-195, 3rd Floor, Industrial Area Phase II, Chandigarh.

Quixotic Healthcare has been a partner to the Pharmaceutical Industry for decades with its pharmaceuticals

formulation support to ensure health worldwide. It also produce and market exclusive advanced formulations with a

huge range of product that are tailored to our customer specific needs. Quixotic Healthcare is today one of the

147

leading manufacturer of new approved drug formulation having facility of Dry Syrup, Liquid Syrup, Tablet and

Capsules.

Capital Structure

Name of the Partner Percentage of Holding

Sanjeev Kumar Singal 37.00 %

Satish Kumar 15.00 %

Harpreet Singh 24.00 %

Himjyoti Dhir 24.00 %

Audited Financial information

Particulars 2014-15 2015-16 2016-17

Total Income 4614.97 4825.20 5504.07

Net Profit 87.23 107.97 109.17

Partners Capital 630.63 573.25 507.00

5. M/s. ALPHA PRODUCTS

Partnership firm Information:

M/S Alpha Products is a Partnership firm incorporated under the Partnership Act, 1932. It was incorporated on

19.10.2007. Its office is situated at Plot no. 655, Industrial Area, Phase II, Chandigarh.

M/S Alpha Products has been a partner to the Pharmaceuticals Industry for decades with its pharmaceuticals

formulation support to ensure health world wide. It also produce and market exclusive advanced formulation with

huge range of products that are tailored to our customers specific needs. Alpha Products is today one of the leading

manufacturer of new approved drug formulation having facility of Soft Gel Capsules.

Capital Structure

Name of the Partner Percentage of Holding

Deepak Bhanot 40%

Preet Remedies Limited 60%

Audited Financial information

Particulars 2014-15 2015-16 2016-17

Total Income 1544.88 2141.57 1751.95

Net Profit 108.78 122.13 88.12

Partners Capital 166.53 139.03 111.03

Related Party Transactions

For details on related party transactions please refer to ‘Financial Statements, as Restated-Annexure-XXVII-Restated

Statement of Related Parties Transactions’ on page 151 of this Prospectus.

148

Defunct /Struck-off Company:

None of our Group Companies have remained defunct and no application has been made to the Registrar of

Companies for striking off the name of any of our Group Companies during the five years preceding the date of

filing the Prospectus with Stock Exchange.

Other Disclosures:

1) None of our Group Companies are under any winding up proceedings.

2) Except Zenlabs Ethica Limited listed on BSE Limited, None of our Group Companies are listed on any of the

Stock Exchanges and they have not made any public/rights issue in last five years. Further, no action has been

taken against these companies by any Stock Exchange or SEBI.

3) None of our Group Companies have negative Net Worth as per the last audited financial statements mentioned

herein.

4) None of our Group Companies have any interest in the promotion of our Company.

Related Business Transactions within the Group Companies and Significance on the Financial Performance

of our Company

For details, please see ‘Financial Statements, as restated-Annexure XXVII-Restated Statement of Related Parties

Transactions’ on page 151 of this Prospectus.

Unsecured Loans extended to our Company, by our Company

For details, please refer to the chapters titled Financial Statements, as restated – Annexure [●] – Restated Statement

of Related Parties Transactions on page 151.

Common Pursuits amongst the Group Companies with our Company

Except Preet Plastic Industries and Ess Ess Gels, All of our group companies mentioned above have some of the

objects similer to that of our companies business

149

RELATED PARTY TRANSACTIONS

For details of the related party transection of our company see Annexure XXVI and Annexure to Accounts to the

financial statement respectively in “Auditors Report and Financial Information of our company” beginning from

page 176 of this prospectus.

150

DIVIDEND POLICY

Under the Companies Act, our Company can pay dividends upon a recommendation by our Board of Directors and

approval by a majority of the shareholders at the General Meeting. The Shareholders of our Company have the right

to decrease not to increase the amount of dividend recommended by the Board of Directors. The Dividends may be

paid out of profits of our Company in the year in which the dividend is declared or out of the undistributed profits or

reserves of previous financial years or out of both. The Articles of Association of our Company also gives the

discretion to our Board of Directors to declare and pay interim dividends.

Our Company does not have any formal dividend policy for the Equity Shares. The declaration and payment of

dividend will be recommended by our Board of Directors and approved by the shareholders of our Company at their

discretion and will depend on a number of factors, including the results of operations, earnings, capital requirements

and surplus, general financial conditions, applicable Indian legal restrictions and other factors considered relevant by

our Board of Directors.

151

SECTION VI - FINANCIAL INFORMATION

FINANCIAL STATEMENTS

RESTATED CONSOLIDATED FINANCIAL STATEMENTS

Report of auditors on the restated summary statement of Assets and Liabilities for the year ended March 31

2018, 2017, 2016, 2015, and 2014, and Profits and Losses and Cash Flows for each of the years ended March

31 2018, 2017, 2016, 2015, and 2014 for Preet Remedies Limited (collectively, the ―Restated Summary

Statements)

To,


Preet Remedies Limited,

194-195, Industrial Area,

Phase II, Ram Darbar,

Chandigarh - 160002

Dear Sir,

We have examined the attached restated summary statement of assets and liabilities of Preet Remedies Limited,

(hereinafter referred to as “the Company”) as on March 31 2018, 2017, 2016, 2015, and 2014 Restated Summary

Statement of Profit and Loss and Restated Summary Statement of Cash Flows for the period ended March 31 2018,

2017, 2016, 2015, and 2014 (collectively referred to as the “Restated Summary Statements” or “Restated

Financial Statements”) annexed to this report and initialed by us for identification purposes. These restated

financial statements have been prepared by the management of the Company and approved by the Board of

Directors of the company in connection with the Initial Public Offering (IPO) on SME Platform of National Stock

Exchange (“NSE”).

1.) These restated summary statements have been prepared in accordance with the requirements of:

(i) Sub-clauses (i) and (iii) of clause (b) of sub-section (1) of section 26 of the Companies Act, 2013 (“the

Act”) read with Companies (Prospectus and Allotment of Securities) Rules 2014;

(ii) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations

2009 (“ICDR Regulations”) and related amendments / clarifications from time to time issued by the

Securities and Exchange Board of India (“SEBI”)

2.) We have examined such restated financial statements taking into consideration:

(i) The terms of reference to our engagement letter with the Merchant Banker requesting us to carry out the

assignment, in connection with the Prospectus/ Prospectus being issued by the Company for its proposed

Initial Public Offering of equity shares in SME Platform of National Stock Exchange(“IPO” or “SME

IPO”); and

(ii) The Guidance Note on Reports in Company Prospectus (Revised) issued by the Institute of Chartered

Accountants of India (“Guidance Note”).

3.) The restated financial statements of the Company have been extracted by the management from the Audited

Financial Statements of the Company for the period ended on March 31 2018, 2017, 2016, 2015, and 2014.

4.) In accordance with the requirements of the Act including the rules made there under, ICDR Regulations,

Guidance Note and Engagement Letter, we report that:

152

(i) The “Restated Statement of Asset and Liabilities” of the Company as on March 31 2018, 2017, 2016,

2015, and 2014 examined by us, as set out in Annexure I to this report read with significant accounting

policies in Annexure IV has been arrived at after making such adjustments and regroupings to the audited

financial statements of the Company, as in our opinion were appropriate and more fully described in notes

to the restated summary statements to this report.

(ii) The “Restated Statement of Profit and Loss” of the Company for the period ended on March 31 2018,

2017, 2016, 2015, and 2014 examined by us, as set out in Annexure II to this report read with Significant

Accounting Policies in Annexure IV has been arrived at after making such adjustments and regroupings to

the audited financial statements of the Company, as in our opinion were appropriate and more fully

described in notes to the restated summary statements to this report.

(iii) The “restated statement of cash flows” of the Company for the period ended on March 31 2018, 2017,

2016, 2015, and 2014 examined by us, as set out in Annexure III to this report read with significant

accounting policies in Annexure IV has been arrived at after making such adjustments and regroupings to

the audited financial statements of the Company, as in our opinion were appropriate and more fully

described in notes to restated summary statements to this report.

5.) Based on our examination, we are of the opinion that the restated financial statements have been prepared:

a) Using consistent accounting policies for all the reporting periods.

b) Adjustments for prior period and other material amounts in the respective financial years to which they

relate.

c) There are no extra-ordinary items that need to be disclosed separately in the accounts and requiring

adjustments.

6.) Audit for the period ended on March 31, 2017, 2016, 2015, and 2014 was conducted by Shiv K Gupta &

Associates and audit for the period ended on 31 March 2018 was conducted by Vijay Darji and Associates. The

financial report included for these period is based solely on the report submitted by them.

7.) We have also examined the following other financial information relating to the Company prepared by the

Management and as approved by the Board of Directors of the Company and annexed to this report relating to

the Company for the period ended on March 31 2018, 2017, 2016, 2015, and 2014 proposed to be included in

the Prospectus / Prospectus (“Offer Document”).

I. Summary statement of consolidated assets and liabilities, as restated as appearing in ANNEXURE I

to this report;

II. Summary statement of consolidated profit and loss, as restated as appearing in ANNEXURE II to

this report;

III. Summary statement of consolidated cash flow as restated as appearing in ANNEXURE III to this

report;

IV. Significant accounting policies as restated as appearing in ANNEXURE IV to this report;

V. Details of share capital as restated as appearing in ANNEXURE V to this report;

VI. Details of reserves and surplus as restated as appearing in ANNEXURE VI to this report;

VII. Details of long term borrowings as restated as appearing in ANNEXURE VII to this report;

VIII. Details of non current investment as restated as appearing in ANNEXURE VIII to this report;

IX. Details of deferred tax asset/liability as restated as per ANNEXURE IX to this report;

X. Details of short term borrowings as restated as appearing in ANNEXURE X to this report;

XI. Details of trade payables as restated as appearing in ANNEXURE XI to this report;

XII. Details of other current liabilities as restated as appearing in ANNEXURE XII to this report;

XIII. Details of short term Provisions as restated as appearing in ANNEXURE XIII to this report;

153

XIV. Details of fixed assets as restated as appearing in ANNEXURE XIV to this report;

XV. Details of long term loans and advances as restated as appearing in ANNEXURE XV to this report;

XVI. Details of trade receivables as restated as appearing in ANNEXURE XVI to this report;

XVII. Details of cash & cash equivalents as restated as appearing in ANNEXURE XVII to this report;

XVIII. Details of short term loans & advances as restated as appearing in ANNEXURE XVIII to this

report;

XIX. Details of Other Current Assets as restated as appearing in ANNEXURE XIX to this report;

XX. Details of Other Non-Current Assets as restated as appearing in ANNEXURE XX to this report;

XXI. Details of inventories as restated as appearing in ANNEXURE XXI to this report;

XXII. Details of revenue from operations as restated as appearing in ANNEXURE XXII to this report;

XXIII. Details of other income as restated as appearing in ANNEXURE XXIII to this report;

XXIV. Details of Raw Material Consumed as restated appearing in ANNEXURE XXIV to this report:

XXV. Details of Changes in Inventories as restated as aapearing in ANNEXURE XXV to this report:

XXVI. Details of Related Party Transactions as restated as appearing in ANNEXURE XXVI to this report;

XXVII. Summary of significant accounting ratios as restated as appearing in ANNEXURE XXVII to this

report,

XXVIII. Capitalization Statement as at March 31, 2018 as restated as appearing in ANNEXURE XXVIII to

this report;

XXIX. Statement of tax shelters as restated as appearing in ANNEXURE XXIX to this report;

8.) The report should not in any way be construed as a re-issuance or re-dating of any of the previous audit reports

issued by any other firm of chartered accountants nor should this report be construed as a new opinion on any of

the financial statements referred to therein.

9.) We have no responsibility to update our report for events and circumstances occurring after the date of the

report.

10.) In our opinion, the above financial information contained in Annexure I to XXVII of this report read with the

respective significant accounting policies and notes to restated summary statements as set out in Annexure IV

are prepared after making adjustments and regrouping as considered appropriate and have been prepared in

accordance with the Act, ICDR Regulations, Engagement Letter and Guidance Note.

(a.) Our report is intended solely for use of the management and for inclusion in the Offer Document in

connection with the SME IPO. Our report should not be used, referred to or adjusted for any other purpose

except with our consent in writing.

11.) Consequently, the financial information has been prepared after making such re-groupings and adjustments as

were, in our opinion, considered appropriate to comply with the same. As a result of this re-grouping and

adjustments, the amount reported in financial information may not necessarily be same as those appearing in the

respective audited financial statements for the relevant years.

For Vijay Darji and Associates

Chartered Accountants

Firm Registration No.: 118614W

CA Vijay Darji

Proprietor

Membership No.: 105197

Place: Mumbai

Date: 10th August, 2018

154

Annexure-I

Statement of Consolidated Assets and Liabilities, as Restated (₹ In Lakhs)


2018 2017 2016 2015 2014



e) Share Capital 600.00 300.00 300.00 300.00 300.00

f) Reserves & Surplus 1720.00 1746.28 1597.10 1408.93 1456.46

Non - Controlling Interest 34.05 30.51 31.45 16.17 -


Pending Allotment






Current Liabilities


(b) Trade Payables 2711.70 2168.80 1927.28 2019.33 1623.59



T O T A L 6652.50 5755.93 4740.98 4676.93 4164.83

ASSETS

Non-Current Assets

(a) Fixed Assets

- Tangible Assets 663.15 722.66 690.42 809.50 550.27






Advances 110.80 114.00 142.48 149.83 154.08


Current Assets

a. Inventories 987.76 665.01 731.01 741.55 605.00




e. Other Current Assets 133.53 115.98 104.32 117.79 45.17

T O T A L 6652.50 5755.93 4740.98 4676.93 4164.83

155

Annexure-II

Statement of Consolidated Profit & Loss, as Restated

(₹ In Lakhs)


2018 2017 2016 2015 2014

Revenue:


Taxes)

6698.92 8083.00 7505.83 7596.65 5735.63

Other Income 59.23 24.84 (3.36) (99.14) 64.28

Total Revenue 6757.47 8107.84 7502.48 7497.51 5799.90

Expenses:



Purchase of Stock-in –Trade - - - - -


goods, work-in-progress and Stock-

in-Trade

(22.73) (24.98) 70.67 (76.84) 72.90


Financial Cost 79.26 81.54 78.85 91.45 85.27


expenses

90.39 102.18 103.49 152.77 74.34

Others Expenses 284.32 251.22 316.34 157.01 140.39

Total Expenses 6349.20 7876.75 7353.15 7455.15 5681.71



408.28 231.09 149.33 42.37 118.19



items and tax (A-B)

408.28 231.09 149.33 42.37 118.19




Tax expense :

Current tax 94.95 55.25 47.50 47.66 13.47

Deferred Tax 3.00 (15.15) (7.19) (10.18) (1.70)



Tax-PAT 310.32 190.99 109.02 4.89 97.06

Note: Manufacturing and operating cost added to cost of material consumed should be shown separately.

156

Annexure-III

Statement of Consolidated Cash Flow, as Restated

(₹ in Lakhs)


2018 2017 2016 2015 2014


Activities:

Net Profit before tax as per Profit

And Loss A/c

408.28 231.09 149.33 42.37 118.19

Adjustments for:

Depreciation & Amortisation

Expense

90.39 102.18 103.49 152.77 74.34

Interest Charged to P&L 79.26 81.54 78.85 91.45 85.27

Interest Income -16.81 -17.21 -18.16 -18.50 -16.35

Finance Cost

Dividend Received -6.71 -0.03 -0.03 -0.02 -0.01

Deferred Tax Adjustment 3.00 -15.15 1.42 - -

MAT Adjustment -85.60 -36.20 - - -

Provision for Gratuity 3.46 -5.40 2.78 - -



Capital Changes

475.26 340.81 399.22 268.07 261.43


Short Term Provision -9.65 3.34 -2.34 2.93 -

Trade Receivables 364.66 -442.78 -209.40 -340.11 -568.90

Other Receivables - - - - 29.81

Short Term Loan & Advances -221.63 -1.44 -20.16 -95.70 -

Inventories -322.75 66.00 10.53 -136.55 217.72

Other Current Assets - - 24.74 20.43 -

Trade Payables 542.90 241.53 -92.05 395.73 501.11

Short Term Borrowings 221.23 83.00 -198.78 34.30 -

Other Current Liabilities -139.73 236.10 74.89 8.87 -129.42

Cash Generated From Operations 435.03 185.76 -412.56 -110.10 50.31


Net Income Tax paid/ refunded -95.97 -55.25 -47.50 -47.73 -27.92



830.32 471.32 -60.85 110.23 283.83


Activities:

Net (Purchases)/Sales of Fixed

Assets (including capital work in

progress)

-768.81 -627.02 -65.95 -45.26 -85.98

Long Term Loans & Advances 3.20 28.48 7.35 4.25 13.44

Investments 16.00 -93.96 - -74.01 -32.85

Interest on FD 16.81 17.22 18.16 18.50 16.35

Dividend received 6.71 0.03 0.03 0.02 0.01



-726.10 -675.26 -40.42 -96.50 -89.02


Activities:

Net Increase/(Decrease) in Long

Term Borrowings

7.57 287.59 71.69 91.44 9.71

157

Interest on Borrowings -79.26 -81.54 -78.85 -91.45 -85.27



-71.69 206.05 -7.16 -0.01 -75.56



16.54 2.12 -108.43 13.72 119.25



280.67 278.55 386.98 373.26 254.00


End of the Year

297.20 280.67 278.55 386.98 373.26

Annexure-IVA

Statement of Significant Accounting Policies

1) Background

Preet Remedies Limited was incorporated on February 10th, 2005 as a Private Limited company (CIN:

U24230CH2005PTC27954) under the Companies Act, 1956. The principal objective of the company is to carry

on the business of manufacturing pharmaceutical formulations. The Company comes under the top contract

manufacturing companies in India. The Company has the capacity to deliver all type of product range such as a

Tablets Capsules, Ointment, Cream, Gel, Lotion, Shampoo. Being a leading third-party Pharma Manufacturing,

we make use of best quality raw material and cutting-edge tools. The financial statements have been prepared to

comply in all material respects with the accounting standards specified under 133 of companies Act, 2013 (“the

Act”) read with rule 7 of companies (Accounts) Rules, 2014 and the relevant provisions of the Act. The

financial statements have been prepared under the historical cost conversion on an accrual basis. The accounting

policies have been consistently applied by the company.

2) Basis of preparation of financial statements

All assets & liabilities have been classified as current &Non-Current as per company’s normal opening cycle &

other criteria set out in the Revised Schedule III.

Based on the nature of services of the company, for the purpose of current/ non-current classification of assets

& liabilities, 12 months have been considered as is operating cycle

The Consolidated Financial Statement are prepared on the basis of Accounting Standard 21 and Accounting

Standard 23 issued by Institute of Chartered Accountant of India (“the ICAI”).

3) Use of estimates

The preparation of financial statements requires management to make estimates and assumptions that affect

amounts in the financial statements and reported notes thereto. Actual results could differ from these estimates.

Differences between the actual result and estimates are recognized in periods in which the results are known/

materialized.

4) Fixed Assets

Fixed assets are stated at historical cost/revalued value less accumulated depreciation and impairment losses, if

any. Cost includes purchase price and all other attributable cost to bring the assets to its working condition for

the intended use. Borrowing costs relating to acquisition/construction of fixed assets which takes substantial

period of time to get ready for its intended use are also included to the extent they related to the period till such

assets are ready for commercial use.

Subsequent expenditures related to an item of tangible asset are added to its book value only if they increase the

future benefits from the existing asset beyond its previously assessed standard of performance.

158

Projects under which assets are not ready for their intended use are shown as Capital Work-in-Progress. Cost

includes cost of land, materials, construction, services, borrowing costs and other overheads relating to projects.

5) Depreciation

Depreciation on fixed assets for the year ended on March 31, 2013 and 2014 is calculated on WDV basis for all

assets using the rates prescribed under Schedule XIV of the Companies Act, 1956. Depreciation on fixed assets

purchased after April 1, 2014 is calculated on WDV basis for all assets using the useful life as prescribed under

Schedule II of the Companies Act, 2013.

6) Investments

Long term investment is stated at cost. However, when there is decline, other than temporary, in the value of

long term investment, the carrying amount is reduced to recognize the decline.

7) Borrowing Costs

Borrowing cost includes interest and amortization of ancillary costs incurred in connection with the

arrangement of borrowings. Borrowing costs that are directly attributable to the acquisition or Construction of

qualifying asset are capitalized as part of the cost of that asset. The amount of borrowing costs eligible for

capitalization is determined in accordance with Accounting Standard 16 (AS 16) on "Borrowing Costs". Other

borrowing costs are recognized as an expense in the period in which they are incurred.

8) Impairment of Asset

The company assesses, at each reporting date determine whether there is any indication of impairment in the

carrying amount of the Company's fixed assets. If any such indication exists, the asset's recoverable amount is

estimated. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered

impaired and is written down to its recoverable amount

9) Cash Flow Statement

Cash flow are reported using the indirect method, whereby profit before tax is adjusted for the effects of

transactions of non cash nature, any deferrals or accruals of past or future operating cash receipts or payments

and item of income or expenses associated with investing or financial cash flow. The cash flows from

operating, investing and financial activities of the company are segregated.

10) Revenue Recognition

Revenue in respect of sale of product and scraps in recognized on accrual basis, and the amount of revenue is

measurable.

11) Earnings per share

The basic earning per shares is computed by dividing the net profit/ (loss) attributable to the equity shareholders

for the year by the weighted average number of equity shares outstanding during the reporting period. For the

purpose of calculating diluted earnings per shares, net profit after tax for the year available for equity

shareholders and the weighted average number of equity shares outstanding during the year are adjusted for the

effects of all dilutive potential equity shares.

12) Foreign currency transactions

Normal Exchange differences at the time of settlement are dealt with in the Profit & Loss account. Monetary

assets and liabilities in foreign currency existing at the Balance Sheet date are translated at the year-end

159

exchange rates. Exchange difference arising on forward contract is recognised as income or expense over the

life of the contract. Any Profit or loss arising on cancellation or renewal of a forward exchange contract is

recognised-as-income or as expense for that period. Exchange rate difference in respect of purchase of Fixed

Assets is adjusted in the carrying amount of respective Fixed Assets.

13) Taxes on Income

Tax comprises current and deferred tax. Current income tax is measured at the amount expected to be paid to

the tax authorities in accordance with the income Tax Act. Deferred income taxes reflects the impact of current

period timing difference between taxable income and accounting income for the period and reversal of timing

difference of earlier years.

Minimum Alternative tax (MAT) is recognised as an asset only when, and to the extent there is convincing

evidence that the company will pay normal income tax during the specific period. In the MAT credit becomes

eligible to be recognised as an asset in accordance the recommendations contained in the Guidance note issued

by ICAI, the said asset is created by the way of credit to the statement of profit & loss & shown as MAT Credit

Entitlement.

The company reviews the same at each balance sheet date and write down the carrying amount of MAT Credit

Entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal

income tax during the specific period.

14) Provident fund/ESIC Contribution

Provident fund is a defined benefits scheme and the contributions are charged to profit and loss account on

accrual basis. The company’s contribution towards ESIC is charge to statement of profit and loss.

15) Inventory

The Stock of Goods at the year-end are valued in accordance with revised AS-2 “Valuation of Inventories”

issued by ICAI. Accordingly, the method of valuation adopted is as under:

Finished Goods – At lower of Cost or Net Realizable Value

Raw Material & Packing Material – At Cost Price

Work-in-Progress – At Material Cost plus Apportioned Manufacturing Overheads

16) Contingent Liabilities & Provisions

Possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-

occurrence of one or more uncertain future events beyond the control of the Company or a present obligation

that is not recognized because it is probable that an outflow of resources will be required to settle the obligation

is reported as contingent liability. In rare cases, when a liability cannot be measured reliably, it is classified as

contingent liability. The Company does not recognize a contingent liability but discloses its existence in the

financial statements.

17) Segment Reporting as per AS- 17, is not applicable to company.

Annexure-IV B

Reconciliation of Restated Profit:

(₹ In Lakhs)

Adjustments for For the year ended March 31,

2018 2017 2016 2015 2014

Net Profit/(Loss) after Tax as per Audited

Profit & Loss Account 326.32 190.99 109.02 4.89 97.06

Adjustments for:

Provision for Gratuity (23.34) (19.88) (9.70) (6.93) (5.04)

160

Net Profit/ (Loss) After Tax as Restated 302.98 171.11 99.32 (2.04) 92.02

Explanatory notes to the above restatements made in the audited financial statements of the Company for the

respective years.

Adjustments having impact on Profit

Provision for Gratuity–Gratuity provision are made as per actuarial valuation report as specified in AS-15.

Material Regrouping

w.e.f, April 1, 2014, Schedule III notified under the Companies Act, 2013 has become applicable to the Company

for preparation and presentation of its financial statements. Revised Schedule VI notified under the Companies Act,

1956 became applicable to the Company from April 1, 2011, for preparation and presentation of its financial

statements. The adoption of Schedule III / Revised Schedule VI does not impact recognition and measurement

principles followed for preparation of financial statements.

There is no significant impact on the presentation and disclosures made in the financial statements on adoption of

Schedule III as compared to Revised Schedule VI. Appropriate adjustments have been made in the restated summary

statements, wherever required, by a reclassification of the corresponding items of income, expenses, assets,

liabilities and cash flows in order to bring them in line with the groupings as per the audited financial statements of

the Company, prepared in accordance with Schedule III and the requirements of the Securities and Exchange Board

of India (Issue of Capital & Disclosure Requirements) Regulations, 2009 (as amended)

Annexure-V

Details of Share Capital:

(₹ in Lakhs)

Particulars

For the year ended March 31,

2018

2017

2016

2015

2014

Equity Share Capital :

Authorised:

Equity Shares of ₹ 10 each 1000.00 500.00 500.00 500.00 500.00

TOTAL 1000.00 500.00 500.00 500.00 500.00

Issued, Subscribed and Paid Up

Equity Shares of ₹ 10 each

600.00

300.00

300.00

300.00

300.00

(₹ 100 each for financial year 2012 -

2013 to 2016 - 2017)

600.00 300.00 300.00 300.00 300.00

Reconciliation of number of shares

outstanding at the end of the year:

Equity Shares at the beginning of the

year

30 30 30 30 30

Add: Shares issued during the year 30 - - - -

Add: Bonus shares issued during the

year

- - - - -

TOTAL 60 30 30 30 30

Details of Shareholders holding more than 5% of the aggregate shares of the Company:

Particulars


2018 2017 2016

2015 2014

Sanjeev Kumar Singal

16,84,000

8,52,000

8,52,000

8,52,000

8,52,000

161

Harpreet Singh

9,04,000

4,52,000

4,52,000

4,52,000

4,52,000

Sanjay Dhir

8,00,000

4,00,000

4,00,000

4,00,000

4,00,000

Satish Kumar

8,88,000

4,44,000

4,44,000

4,44,000

4,44,000

Himjyoti Dhir 9,04,000 4,52,000 4,52,000 4,52,000 4,52,000

Jasbir Singh Kalra 8,00,000 4,00,000 4,00,000 4,00,000 4,00,000

TOTAL 59,80,000 30,00,000 30,00,000 30,00,000 30,00,000

Annexure-VI

Details of Reserves and Surplus:

(₹ in Lakhs)

Particulars March 31

2018 2017 2016 2015 2014

Profit & Loss Account

(closing balance)

1153.43 1135.11 1098.38 1105.87 1008.81

Transfer from Profit & loss 338.69 123.26 15.19 (126.47) 97.06

Revenue share from

Partnership Firm

41.38 40.64 56.30 50.11 -

General Reserve:

Opening Balance 271.84 308.04 310.33 322.20 322.20

Amount transferred during

the year/adjusted 115JAA

(336.21) (36.20) (2.29) (10.80) -

Amount Transferred during

the year for depreciation

relating to earlier year

34.85 - - (1.07) -

Capital Investment Subsidy 28.39 28.39 28.39 28.39 28.39

Closing Balance (1.13) 300.23 336.43 338.72 350.59

Capital Reserve 187.63 147.05 90.81 40.70 -

TOTAL 1720.00 1746.28 1597.11 1408.93 1456.46

Annexure-VII

Details of Long Term Borrowing:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Term Loan, Secured

Term Loan From Bank 319.88 244.76 17.42 - -

Vehicle Loan 41.03 66.74 10.74 19.45 38.89

Cash Credit 136.28 178.12 173.86 110.88 -

TOTAL 497.18 489.61 202.02 130.33 38.89

Details of Non Current Investments Annexure-VIII


2018 2017 2016 2015 2014

Alpha products Baddi -a firm in

which company is interested as a

Partner

- - - - 225.91

Investment in Zenlabs Ethica Limited 251.02 251.02 157.06 157.06 157.06

Investment in SWMPL Nalagarh

1.00 1.00 1.00 1.00 1.00

162

Investment in Oasis Pharma &

Phytomolecules Private Limited

74.01 74.01 74.01 74.01 -

Income from Associates 35.71 7.60 (21.54) (118.98) 47.85

TOTAL 361.74 333.63 210.53 113.09 431.82

Annexure-IX

Details of Deferred Tax Asset/Liability:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Deferred Tax Liabilities

Depreciation Opening balance (38.59) (23.44) (16.24) (6.06) (4.36)

During the Year 3.00 (15.15) (7.19) (10.18) (1.70)

TOTAL (35.59) (38.59) (23.44) (16.24) (6.06)

Annexure-X

Details of Short Term Borrowing:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Loans repayable on demand from

Banks

Secured

Current Maturities of Long Term

Debts

96.95 89.79 8.70 19.45 17.96

Working Capital Loan from Banks:

BOI Cash Credit

BOI Cash Credit - - 398.15 585.99 548.57

BOI Loan against FDR 135.01 - 51.22 51.40 56.02

HDFC Cash Credit 530.33 451.27 - - -

TOTAL 762.29 541.06 458.06 656.84 622.55

Annexure-XI

Details of Trade Payables:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Trade payables:

Sundry Creditors for Trade 2711.70 2168.80 1927.28 2010.31 1622.36

Current Account - - - 9.02 -

Sundry Creditors Capital - - - - 1.23

TOTAL 2711.70 2168.80 1927.28 2019.33 1623.59

Annexure-XII

Details of Other Current Liabilities:

(₹ in Lakhs)

Particulars As at March 31

2018 2017 2016 2015 2014

Expenses payable 283.29 430.11 192.39 124.16 115.35

statutory remittances 13.75 6.66 8.27 1.61 1.55

TOTAL 297.29 436.77 200.66 125.77 116.90

163

Annexure-XIII

Details of Short Term Provision:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Gratuity Liability 23.34 19.88 9.70 6.93 5.04

Bonus 4.68 4.17 4.00 5.23 1.39

Provision for Tax (Net of Advance

Tax)

2.22 15.85 10.70 7.39 -

Provision for Tax (For previous year) - 2.99 - - -

TOTAL 30.24 42.90 24.40 19.55 6.43

Details of Fixed Assets Annexure -XIV

FY 2013-2014

(₹ in Lakhs)

Particulars

Gross Block Depreciation Net Block

Balance as

at April

01, 2013

Additio

ns

De

du

cti

on

du

rin

g

the

yea

r

Balan

ce as

at

Marc

h 31,

2014

Bala

nce

as at

April

01,

2013

Dep

reci

atio

n

cha

rge

for

the

year

Ad

jus

tm

ent

s

On

Disp

osal

s

Upto

March

31,

2014

Bala

nce

as at

Mar

ch

31,

2014

Bala

nce

as at

Mar

ch

31,

2013

Fixed Assets

Tangible

Assets

Land

108.98 108.9

8

108.

98

108.

98

Building

178.94 178.9

4

68.46 11.0

5

79.51 99.4

3

110.

48

Plant and

machinery

387.77 40.61 428.3

8

198.8

5

29.7

1

228.56 199.

82

188.

92

Electrical

Equipment

69.30 2.38 71.68 35.00 4.83 39.83 31.8

5

34.3

0

Furniture and

fixture

67.03 67.03 39.50 4.98 44.48 22.5

5

27.5

3

Total (i)

812.02 42.99 - 855.0

1

341.8

1

50.5

7

392.38 462.

63

470.

21

Office

equipment

Vehicles

141.10 38.55 179.6

5

85.85 19.9

6

105.81 73.8

4

55.2

5

Computers 20.06 1.45 21.51 16.55 1.78 18.33 3.18 3.51

Lab Equipment 14.81 1.48 16.29 6.69 1.72 8.41 7.88 8.12

Mobile Phone 2.15 1.50 3.65 0.63 0.30 0.93 2.72 1.52

Total (ii)

178.12 42.98 - 221.1

0

109.7

2

23.7

6

133.48 87.6

2

68.4

0

TOTAL (i) +

(ii)

990.14 85.97 - 1076.

11

451.5

3

74.3

3

525.86 550.

25

538.

61

164

Year 2014-2015

(₹ in Lakhs)

Particulars


Balance

as at

April

01, 2014

Addi

tions

De

duc

tion

dur

ing

the

yea

r

Balan

ce as

at

Marc

h 31,

2015

Bala

nce

as at

Apri

l 01,

2014

Depr

eciati

on

charg

e for

the

year

Adju

stme

nts

On

disp

osal

s

Bala

nce

as at

Mar

ch

31,

2015

Bala

nce

as at

Mar

ch

31,

2015

Bala

nce

as at

Mar

ch

31,

2014

Fixed Assets

Land

115.21 115.2

1

115.

21

115.

21

Building

320.11 7.58 327.6

9

79.5

1

23.88 103.

39

224.

30

240.

60

Plant and

machinery

624.79 19.56 644.3

5

228.

56

72.71 301.

27

343.

07

396.

23

Electrical

Equipment

77.33 7.30 84.63 39.8

3

15.05 54.8

8

29.7

6

37.5

0

Furniture and

fixture

80.02 7.40 87.41 44.4

9

10.12 54.6

0

32.8

1

35.5

3

Total (i)

1217.45 41.84 1259.

29

392.

39

121.7

5

514.

14

745.

15

825.

06

Office equipment

Vehicles

184.92 184.9

2

105.

81

25.08 0.46 131.

35

53.5

7

79.1

1

Computers

21.62 1.49 23.11 18.3

3

1.93 0.46 20.7

2

2.39 3.29

Lab Equipment

16.30 1.57 17.86 8.41 2.54 10.9

5

6.91 7.88

Mobile Phone 3.65 0.36 4.02 0.93 1.46 0.14 2.53 1.49 2.73

Total (ii)

226.49 3.42 229.9

1

133.

48

31.01 1.06 165.

56

64.3

5

93.0

1

TOTAL (i) + (ii)

1443.94 45.26 1489.

20

525.

86

152.7

7

1.06 679.

70

809.

50

918.

08

Building under

Construction

Year 2015-2016

(₹ in Lakhs)

Particulars


Bala

nce

as at

Apri

l 01,

2015

Add

itio

ns

Ded

uctio

n

duri

ng

the

year

Bala

nce

as at

Mar

ch

31,

2016

Bala

nce

as at

Apri

l 01,

2015

Depr

eciati

on

charg

e for

the

year

Adju

stme

nts

On

disp

osal

s

Bala

nce

as at

Mar

ch

31,

2016

Bala

nce

as at

Mar

ch

31,

2016

Bala

nce

as at

Mar

ch

31,

2015

Fixed Assets

Land

115.

21

115.

21

- - 115.

21

115.

21

165

Building

327.

69

4.86 332.

55

103.

39

21.78 125.

17

207.

38

224.

30

Plant and machinery

644.

35

40.5

7

286.

91

398.

01

301.

27

44.53 193.

39

152.

42

245.

59

343.

07

Electrical Equipment

84.6

3

2.04 86.6

7

54.8

8

8.79 63.6

6

23.0

1

29.7

6

Furniture and fixture

87.4

1

87.4

1

54.6

0

6.82 61.4

3

25.9

9

32.8

1

Total (i)

1259

.29

47.4

8

286.

91

1019

.86

514.

14

81.93

193.

39

402.

68

617.

18

745.

15

Office equipment

Vehicles

184.

92

26.7

6

211.

68

131.

35

17.14 148.

50

63.1

8

53.5

7

Computers

23.1

1

0.61 23.7

2

20.7

2

1.47 22.2

0

1.53 2.39

Lab Equipment

17.8

6

1.83 19.6

9

10.9

5

2.18 13.1

3

6.56 6.91

Mobile Phone 4.02 1.25 5.27 2.53 0.76 3.29 1.98 1.49

Total (ii)

229.

91

30.4

6

260.

37

165.

56

21.56 187.

12

73.2

5

64.3

5

TOTAL (i) + (ii)

1489

.20

77.9

3

286.

91

1280

.22

679.

70

103.4

9

193.

39

589.

80

690.

42

809.

50

Building under

Construction

FY 2016-2017

(₹ in Lakhs)

Particulars


Bala

nce

as at

Apri

l 01,

2016

Addi

tions

Ded

ucti

on

duri

ng

the

yea

r

Bala

nce

as at

Mar

ch

31,

2017

Bala

nce

as at

Apri

l 01,

2016

Depr

eciati

on

charg

e for

the

year

Adju

stme

nts

On

disp

osal

s

Bala

nce

as at

Marc

h 31,

2017

Balan

ce as

at

Marc

h 31,

2017

Balan

ce as

at

Marc

h 31,

2016

Fixed Assets

Tangible Assets

Land

115.

21

115.

21

- 115.2

1

115.2

1

Building

332.

55

332.

55

125.

17

20.23 145.4

0

187.1

5

207.3

8

Plant and machinery

398.

01

5.75 403.

76

152.

42

40.71 193.1

3

210.6

3

245.5

9

Electrical Equipment

86.6

7

0.05 86.7

3

63.6

6

5.43 69.10 17.63 23.01


87.4

1

4.76 92.1

8

61.4

3

4.90 66.33 25.85 25.99

Total (i)

1019

.86

10.5

7

1030

.42

402.

68

71.27 473.9

5

556.4

7

617.1

8

Office equipment

Vehicles

211.

68

117.

87

329.

56

148.

50

27.09 175.5

8

153.9

7

63.18

166

Particulars


Bala

nce

as at

Apri

l 01,

2016

Addi

tions

Ded

ucti

on

duri

ng

the

yea

r

Bala

nce

as at

Mar

ch

31,

2017

Bala

nce

as at

Apri

l 01,

2016

Depr

eciati

on

charg

e for

the

year

Adju

stme

nts

On

disp

osal

s

Bala

nce

as at

Marc

h 31,

2017

Balan

ce as

at

Marc

h 31,

2017

Balan

ce as

at

Marc

h 31,

2016

Computers

23.7

2

23.7

2

22.2

0

0.50 22.70 1.03 1.53

Lab Equipment

19.6

9

4.46 24.1

5

13.1

3

2.30 15.44 8.71 6.56

Mobile Phone 5.27 1.51 6.78 3.29 1.01 4.30 2.48 1.98

Total (ii)

260.

37

123.

84

384.

21

187.

12

30.9 218.0

2

166.1

9

73.25

GRAND TOTAL

(I+II)

1280

.22

134.

41

1414

.63

589.

80

102.1

8

691.9

7

722.6

6

690.4

2

Building under

Construction 378.

57

378.

57

378.5

8

P&M under

installation 114.

04

114.

04

114.0

4

FY 2017-2018

(₹ in Lakhs)

Particulars


Bala

nce

as at

Apri

l 01,

2017

Add

itio

ns

Ded

uctio

n

duri

ng

the

year

Balan

ce as

at

Marc

h 31,

2018

Bala

nce

as at

Apri

l 01,

2017

Depr

eciati

on

charg

e for

the

year

Adju

stme

nts

On

disp

osal

s

Balan

ce as

at

Marc

h 31,

2018

Balan

ce as

at

Marc

h 31,

2018

Bala

nce

as at

Marc

h 31,

2017

Fixed Assets

Tangible Assets

Land

115.

21

115.2

1

- 115.2

1

115.2

1

Building

332.

55

11.5

0

344.0

5

145.

40

18.87 164.27 179.7

8

187.1

5

Plant and machinery

403.

76

6.59 410.3

5

193.

13

34.85 227.98 182.3

8

210.6

3

Electrical

Equipment

86.7

3

86.73 69.1

0

3.58 72.67 14.05 17.63


92.1

8

6.17 98.35 66.3

3

4.77 71.10 27.25 25.85

Total (i)

1030

.42

24.2

6

1054.

69

473.

95

62.07 536.02 518.6

7

556.4

7

Office equipment

Vehicles

329.

56

329.5

6

175.

58

24.38 199.97 129.5

9

153.9

7

Computers 23.7 2.81 26.54 22.7 0.53 23.23 3.31 1.03

167

Particulars


Bala

nce

as at

Apri

l 01,

2017

Add

itio

ns

Ded

uctio

n

duri

ng

the

year

Balan

ce as

at

Marc

h 31,

2018

Bala

nce

as at

Apri

l 01,

2017

Depr

eciati

on

charg

e for

the

year

Adju

stme

nts

On

disp

osal

s

Balan

ce as

at

Marc

h 31,

2018

Balan

ce as

at

Marc

h 31,

2018

Bala

nce

as at

Marc

h 31,

2017

2 0

Lab Equipment

24.1

5

2.79 26.94 15.4

4

2.42 17.86 9.09 8.71

Mobile Phone 6.78 1.02 7.80 4.30 0.99 5.29 2.50 2.48

Total (ii)

384.

21

6.63 390.8

3

218.

02

28.33 246.35 144.4

9

166.1

9

Total (i) + (ii)

1414

.63

30.8

9

1445.

52

691.

97

90.39 782.37 663.1

5

722.6

6

Building under

Construction 378.

57

362.

23

740.8

0

740.8

0 378.5

8

P&M under

installation 114.

04

337.

51

17.4

2

434.1

4

434.1

4 114.0

4

Electrical Eqpmt

under installation

55.5

9

55.59 55.59

Annexure-XV

Details of Long Term Loans and Advances:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Security Deposits

Security Deposits

(with Govt, public and other)

39.81 17.90 17.90 10.59 10.29

MAT Credit Entitlement 70.89 96.00 124.48 139.14 143.70

Others 0.10 0.10 0.10 0.10 0.10

TOTAL 110.80 114.00 142.48 149.83 154.09

Annexure-XVI

Details of Trade Receivables:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Outstanding for a period more than 6

months from date they are due for

payment

405.37 390.90 78.49 173.25 145.20

Outstanding for a period less than 6


payment

2213.50 2592.64 2462.27 2158.11 1846.04

TOTAL 2618.87 2983.54 2540.76 2331.36 1991.24

Annexure-XVII

Details of Cash & Cash Equivalents:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Cash In Hand 16.63 11.57 15.97 16.51 15.06

168

Balance with bank:

In current accounts 31.74 35.22 44.18 168.12 171.51

Fixed deposits with Bank 248.82 233.87 218.40 202.35 186.68

TOTAL 297.20 280.67 278.55 386.98 373.26

Annexure-XVIII

Details of Short Term Loan and Advances:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Short Term Loans And Advances

Balance with govt authorities 198.21 23.00 26.82 23.80 5.34

Security Deposits 11.99 11.99 11.99 12.46 0.27

Advances to Creditors 13.84 0.80 0.65 0.43 0.66

Advances to employees 25.17 1.57 2.71 0.60 0.24

Advances For Expenses 1.60 3.50 1.75 1.59 1.43

Other Advances 96.05 84.37 79.88 64.76 0.66

TOTAL 346.86 125.23 123.79 103.64 7.94

Annexure-XIX

Details of Other Current Assets:

(₹ in Lakhs)


2018 2017 2016 2015 2014`

Others Current Assets

Interest Accrued - - - - -

VAT Receivable - - - 24.74 45.17

Prepaid Expenses - - - - -

TOTAL - - - 24.74 45.17

Annexure-XX

Details of Other Non-Current Assets:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Deposits - - - - -

Other non-current assets - - -

TOTAL - - - - -

Annexure-XXI

Details of Inventories:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Inventories

Raw Materials & Packing

Materials

923.73 623.71 714.69 654.55 594.84

Work in Progress 64.03 27.17 12.65 82.84 7.78

Finished goods / Trading Stock - 14.13 3.67 4.15 2.38

TOTAL 987.76 665.01 731.01 741.55 605.00

Annexure-XXII

169

Details of Revenue from Operations: (₹ in Lakhs)


2018 2017 2016 2015 2014

Revenue From Operations

Manufacturing Goods –

Domestic (Net of Sales

Return)

6698.25 8083.00 7505.83 7596.65 5735.63

TOTAL 6698.25 8083.00 7505.83 7596.65 5735.63

Annexure-XXIII

Details of Other Income:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Interest on FDR 16.81 17.19 17.84 18.16 16.35

Dividend Income 6.71 0.03 0.03 0.02 0.01

Discount Received - - - 1.32 0.06

Interest from HPSEB - 0.02 0.32 0.34 -

Other Income (Income from

Associates)

35.71 7.60 -21.54 -118.98 47.85

TOTAL 59.23 24.84 -3.36 -99.14 64.28

Annexure-XXIV

Cost of Material Consumed:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Opening stock 623.71 714.69 654.55 668.78 739.66

Add: Purchase 5314.31 6441.92 5900.89 6282.92 4652.59

Less closing stock -923.73 -623.71 -714.69 -654.55 -594.84

TOTAL 5014.29 6532.90 5840.75 6297.14 4797.41

Annexure-XXV

Change in Inventories of Finished Goods and Stock in Process:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Stock In Process & Finished

Goods

Stock-in-Process (closing stock

less opening stock)

36.86 14.52 (70.19) 75.06 1.65

Finished Goods (closing stock

less opening stock)

(14.13) 10.46 (0.48) 1.77 (74.55)

TOTAL 22.73 24.98 (70.67) 76.83 (72.90)

Employee Benefits Expense:

Salaries & Wages 495.60 495.29 559.09 600.41 344.05

Contribution to PF & Other Funds 7.72 7.02 6.55 7.47 5.30

Staff and labour Welfare

Expenses

7.73 11.05 9.20 8.10 7.52

Provision for Gratuity 3.81 5.35 2.77 1.89 5.04

Bonus & Incentives Expense 6.06 14.87 6.56 8.76 1.39

170


2018 2017 2016 2015 2014

TOTAL 520.92 533.58 584.17 626.63 363.29

Finance Cost :

Interest Paid on Term Loan, CC

& Other Loan

28.33 35.03

21.71 91.45 85.27

Interest Paid on Working Capital 50.93 46.51 57.14 - -

Bank Charges 1.82 11.26 4.73 2.00 1.46

TOTAL 81.08 92.80 83.58 93.45 86.73

Depreciation & Amortization

Depreciation of Tangible assets 90.39 102.18 103.49 152.77 74.34

TOTAL

Other Expenses:

Manufacturing & Operating

Costs

Job work 120.50 - - - -

Power & Fuel 79.75 80.65 73.20 97.24 90.87

Packing Material Expenses 0.32 0.44 0.25 - -

Repair to Machinery 9.30 33.14 39.72 18.85 11.24

Repairs – Others - - - 7.40 5.00

Consumables / Stores 0.06 8.28 4.71 7.94 4.77

Production Expenses - Others 96.85 100.39 102.99 26.28 6.97

Lab Expenses 40.68 30.64 6.24 19.42 9.95

Freight & Carriage Inward 35.29 21.21 18.79 26.33 17.80

Manufacturing Charges for Loan

License

- 125.57 112.85 - -

Cylinder Charges - - 0.14 - -

Food Expenses 3.52 1.51

TOTAL 382.76 400.32 358.88 206.98 148.11

Administrative Expenses

Association Fee - - 0.25 - -

Travelling & Conveyance

- Director (Domestic) 3.97 11.00 5.68 4.68 3.05

- Director (Foreign) 23.12 7.76 10.81 5.90 4.46

- Other 1.91 2.80 2.36 9.75 3.15

Commission Expenses 0.46 0.74 0.91 0.68 -

Advertisement Expenses

Directors Remuneration 80.40 24.60 24.60 24.60 21.60

Boarding & Lodging Expenses

Insurance Expenses 6.11 9.13 5.90 4.68 3.15

Printing & Stationery 10.84 4.96 11.28 6.54 7.98

Business Promotion Expenses 1.99 4.61 5.09 1.07 0.75

Job work Expenses 0.40 - 1.15 - -

Discount & Deduction - - - 2.14 9.25

Tour & Travel Expenses

Freight & Carriage Outward 4.00 13.19 11.34 15.39 14.34

Legal and Professional Charges 35.88 7.04 10.55 7.42 6.79

Pollution Control Expenses 7.51 1.29 0.61 3.39 0.70

Postage & Telegram Expenses 2.00 1.79 1.19 0.81 1.49

Loading & Unloading Expenses

Festival Expenses 3.36 3.96 7.85 4.42 4.80

Telephone Expenses 7.50 8.18 8.71 6.00 5.28

Repairs & Maintenance Expenses

171


2018 2017 2016 2015 2014

- Vehicle 2.47 26.41 3.93 3.72 1.70

- Computer 1.86 2.04 1.94 1.04 1.38

- Others 7.78 33.01 26.16 1.70 -

Charity & Donation Expenses 0.26 0.64 0.87 0.72 0.70

Miscellaneous Expenses 0.37 4.55 8.06 2.68 2.60

Office Expenses 1.75 2.64 5.27 4.37 0.67

Office Rent 27.46 20.62 16.04 13.11 14.89

Forfeiture of Earnest Deposit - - - - 5.00

Rebate & Discount 12.31 19.69 13.54 0.04 0.07

Meeting & Conference Expenses

Rate, Fee & Taxes 6.15 2.99 0.57 0.45 2.37

Research & Development

Expenses

- - 15.34 - -

Vehicle Running & Maintenance 0.17 0.27 3.95 3.73 5.03

Service Taxes 1.04 3.31 2.70 2.09 1.84

Security Expenses 27.61 21.82 21.49 21.35 14.79

Interest on Income Tax 0.75

Packing Expenses 0.84 0.02 0.19 1.16 0.07

Procurement & Service Charges - 0.20 0.44 0.45 0.02

Product Approval Expenses - - 0.07 - 0.25

Preliminary Expenses W/Off - - - - 0.16

Loss on Sale of Machinery - - 81.54 - -

Auditor Remuneration 1.89 0.69 1.20 0.90 0.62

TOTAL

Selling & Distribution Expenses

Sales & Marketing Expenses 0.32

TOTAL 282.49 239.95 311.61 155.00 138.93

172

Annexure-XXVI

Details of Related Party Transactions:

Details of Related Party Transactions by Preet Remedies Limited Name Relatio

nship

Nature of

Transactio

n

Amount

of

Transact

ion upto

stub

Period if

applicabl

e

Amount

Outstandi

ng

as on Stub

Period, if

applicable

Payable/

(Receivab

le)

Amount

of

Transacti

on

upto31.03

.2017

Amount

out

Standing

as on

31.03.201

7

Payable/

(Receiva

ble)

Amoun

t of

Transa

ction

upto31.

03.216

Amount

out

Standing

as on

31.03.201

6

Payable/

(Receiva

ble)

Amount

of

Transact

ion in

2014 –

2015

Amount

out

Standing

as on

31.03.2015

Payable/

(Receivabl

e)

Amount of

Transactio

n in 2013 –

2014

Amount

out

Standing

as on

31.03.201

4

Payable/

(Receiva

ble)

Amount of

Transactio

n in 2012 –

2013

Amount out

Standing as

on

31.03.2013

Payable/

(Receivable)

Shiva

Traders

Related

Party

Purchase 19.59 11.98 33.05 19.14 44.73 76.38

Payable 4.96 4.31 2.00 3.99 0.91 14.88

Ultrachir

aonHelathcarePvt

Ltd

Related

Party

Purchase - - 3.34 92.98 224.86 1104.10

Sales 22.47 135.96 59.57 26.71 14.12 12.67

Receivable (99.87) (109.37) (73.37) 0.19

Payable 34.24 9.54

Precision

Polymer

Related

Party

Purchase 22.82 24.73 29.41 57.87 34.35 25.30

Payable 4.85 4.23 3.85 7.70 5.00

Preet

Plastic Industry

Related

Party

Purchase 0.17 0.19 - 1.11 - 3.78

Payable 0.36 11.21 0.14

Preet

Packaging

solution

Related

Party

Purchase 23.47 - 22.89 23.62 26.63 17.49

Payable 7.80 6.22 7.44 6.89

1.24

Oasis

Pharma and

Phytomle

cules

Related

Party

Purchase 3.86 154.42 102.80 - - -

Sales 303.04 582.99 321.17 4.26 - -

Receivable (459.92) (376.45) (316.36) (4.27)

Alpha

Products

Related

Party

Purchase 20.83 4.89 0.10 - - -

Sales 20.92 73.30 121.41 0.14 - -

Receivable (31.37) (74.68) (107.37) \

-

Quixotic

Healthcare

Related

Party

Purchase 232.28 8.74 20.71 25.09 - -

Sales 32.82 104.11 3.70 - - -

Recevable (57.29)

Payable 195.16 - 3.23 38.08

ZenlabsE

thica Limited

Related

Party

Purchase - - - - -

Sales 2005.37 2308.37 2110.90 2744.35 2673.81 1642.88

Receivable (545.57) (963.36) (572.62) (1107.68) (1079.59) (695.72)

173

Name Relatio

nship

Nature of

Transactio

n

Amount

of

Transact

ion upto

stub

Period if

applicabl

e

Amount

Outstandi

ng

as on Stub

Period, if

applicable

Payable/

(Receivab

le)

Amount

of

Transacti

on

upto31.03

.2017

Amount

out

Standing

as on

31.03.201

7

Payable/

(Receiva

ble)

Amoun

t of

Transa

ction

upto31.

03.216

Amount

out

Standing

as on

31.03.201

6

Payable/

(Receiva

ble)

Amount

of

Transact

ion in

2014 –

2015

Amount

out

Standing

as on

31.03.2015

Payable/

(Receivabl

e)

Amount of

Transactio

n in 2013 –

2014

Amount

out

Standing

as on

31.03.201

4

Payable/

(Receiva

ble)

Amount of

Transactio

n in 2012 –

2013

Amount out

Standing as

on

31.03.2013

Payable/

(Receivable)

(₹ In Lakhs)

Details of Related Party Transactions by Zenlabs Ethica and Oasis Pharma and Phytomolocules Pvt Ltd with related party Other than Preet Remedies

Limited

Name Relatio

nship

Nature

of

Transact

ion

Amount of

Transactio

n upto

stub

Period if

applicable

Amount

Outstandi

ng

as on Stub

Period, if

applicable

Payable/

(Receivab

le)

Amount

of

Transacti

on upto

31.03.201

7

Amoun

t out

Standi

ng as

on

31.03.2

017

Payabl

e/

(Receiv

able)

Amount

of

Transact

ion upto

31.03.216

Amoun

t out

Standi

ng as

on

31.03.2

016

Payabl

e/

(Receiv

able)

Amount of

Transactio

n in 2014 –

2015

Amount

out

Standing

as on

31.03.20

15

Payable/

(Receiva

ble)

Amount of

Transactio

n in 2013 –

2014

Amoun

t out

Standi

ng as

on

31.03.2

014

Payabl

e/

(Receiv

able)

Amount of

Transaction

in 2012 –

2013

Amount out

Standing as

on 31.03.2013

Payable/

(Receivable)

Ultrachir

aonHelat

hcarePvt Ltd

Related

Party

Purchase 201.92 320.55 55.04 - - -

Sales - - - -

Payable 34.82 40.79 76.48

Alpha Products

Related Party

Purchase 600.30 963.77 198.93 - - -

Sales

Payable 281.95 260.25 280.49

Quixotic

Healthcare

Related

Party

Purchase 2078.41 2278.16 609.22 - - -

Debtors 269.64

Payable 666.91 1002.48

844.70

Preet

Packagin

g Solution

Related

Party

Purchase 4.14

Sales

Payable 2.72 4.32 1.00

Shiva

Traders

Related

Party

Purchase 2.24

Sales

Payable 2.65 2.65

174

Annexure-XXVII

Details of Accounting Ratios:

(₹ in Lakhs, except per share data)


2018 2017 2016 2015 2014

Restated PAT as per P&L

Account 302.98 171.11 99.32 (2.04) 92.02

Weighted Average Number of

Equity Shares at the end of the

Year/Period*

60.00 30.25 30.00 30.00 30.00

Number of Equity Shares

outstanding at the end of the

Year/Period

60.00 30.25 30.00 30.00 30.00

Net Worth

2369.15 2076.79 1928.55 1725.10 1756.46

Earnings Per Share

Basic & Diluted 5.05 5.66 3.31 - 3.07

Return on Net Worth (%) 12.79% 8.24% 5.15% (0.12)% 5.24%

Net Asset Value Per Share (₹) 39.49 69.23 64.28 57.50 58.55

Nominal Value per Equity

share (₹)

10.00 10.00 10.00 10.00 10.00

Ratios have been calculated as below:

Basic and Diluted Earnings per

Share (EPS) (₹)

: Restated Profit after Tax available to Equity Shareholders

Weighted Average Number of Equity Shares at the end of the

year/period

Return on Net Worth (%) : Restated Profit after Tax available to equity Shareholders

Restated Net Worth of Equity Shareholders

Net Asset Value per equity share

(₹)

: Restated Net Worth of Equity Shareholders

Number of Equity Shares outstanding at the end of the year / period

Annexure-XXVIII

Capitalization Statement as at March 31, 2018

(₹ in Lakhs)

Particulars Pre Issue Post

Issue

Borrowings

Short term debt (A) 762.29 762.29

Long Term Debt (B) 497.18 497.18

Total debts (C) 1259.47 1259.47

Shareholders’ funds

Equity share capital 600.00 840.00

Reserve and surplus - as restated 1735.10 2719.10

Total shareholders’ funds 2335.10 3559.10

Long term debt / Shareholders’ funds 21.29% [•]

Total debt / shareholders fund 53.94% [•]

The post issue capatilization statement assumes that the debt level of the company to be same as that of March

31, 2018

Annexure-XXIX

Statement of Tax Shelters:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Restated Profit before tax (A) 424.27 231.09 149.33 42.37 118.19

175

Tax Rate (%) 30% 30% 30% 30% 30%

MAT Rate 18.5% 18.5% 18.5% 18.5% 18.5%

Adjustments:

(b) Permanent Differences

(Profit)/Loss on sale of FA - - 81.54 - -

Donation 0.26 0.64 0.87 0.72 0.70

Disallowed u/s 36 to 40 4.39 5.05 6.63 9.92 14.61

Total Permanent Differences(B) 4.65 5.69 89.04 10.64 15.31

(c) Timing Differences

Gratuity provision 23.34 19.88 9.70 6.93 5.04

Gratuity payment

Difference between tax depreciation

and book depreciation

9.71 9.37 (0.12) (40.89) (5.49)

Total Timing Differences (C) 33.05 29.25 9.58 (33.96) (0.45)

Net Adjustments D = (B+C) 37.70 34.94 98.62 (23.32) 14.86

Incomes Considered Separately

Taxable Income/(Loss) (A+D) 461.97 266.03 247.95 19.05 133.05

Restated Profit for The Purpose of

MAT / AMT

447.61 250.96 159.03 49.30 123.24

Taxable Income / (Loss) as per

MAT / AMT

372.45

(282.80+89.

65)

223.49

(135.36+88.

13)

170.90(48.7

4+122.16)

161.34

(52.56+108.

78)

70.34

Income Tax as returned/computed 275.10

(207.66+67.

44)

175.62

(109.52+66.

10)

216.61

(124.99+91.

62)

161.64

(79.86+81.7

8)

70.34

Tax paid as per normal or MAT NORMAL NORMAL NORMAL NORMAL MAT

176

AUDITOR’S REPORT ON RESTATED STANDALONE FINANCIAL STATEMENTS

Report of auditors on the restated summary statement of Assets and Liabilities for the year ended March

31 2018, 2017, 2016, 2015, and 2014, and Profits and Losses and Cash Flows for each of the years ended

March 31 2018, 2017, 2016, 2015, and 2014 for Preet Remedies Limited (collectively, the ―Restated

Summary Statements)

To,


Preet Remedies Limited,

194-195, Industrial Area,

Phase II, Ram Darbar,

Chandigarh - 160002

Dear Sir,

We have examined the attached restated summary statement of assets and liabilities of Preet Remedies

Limited, (hereinafter referred to as “the Company”) as on March 31 2018, 2017, 2016, 2015, and 2014

Restated Summary Statement of Profit and Loss and Restated Summary Statement of Cash Flows for the period

ended March 31 2018, 2017, 2016, 2015, and 2014 (collectively referred to as the “Restated Summary

Statements” or “Restated Financial Statements”) annexed to this report and initialed by us for identification

purposes. These restated financial statements have been prepared by the management of the Company and

approved by the Board of Directors of the company in connection with the Initial Public Offering (IPO) on SME

Platform of National Stock Exchange (“NSE”).

12.) These restated summary statements have been prepared in accordance with the requirements of:

(iii) Sub-clauses (i) and (iii) of clause (b) of sub-section (1) of section 26 of the Companies Act, 2013 (“the

Act”) read with Companies (Prospectus and Allotment of Securities) Rules 2014;

(iv) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)

Regulations 2009 (“ICDR Regulations”) and related amendments / clarifications from time to time

issued by the Securities and Exchange Board of India (“SEBI”)

13.) We have examined such restated financial statements taking into consideration:

(i) The terms of reference to our engagement letter with the Merchant Banker requesting us to carry out

the assignment, in connection with the Prospectus/ Prospectus being issued by the Company for its

proposed Initial Public Offering of equity shares in SME Platform of National Stock Exchange(“IPO”

or “SME IPO”); and

(ii) The Guidance Note on Reports in Company Prospectus (Revised) issued by the Institute of Chartered

Accountants of India (“Guidance Note”).

14.) The restated standalone financial statements of the Company have been extracted by the management from

the Audited Financial Statements of the Company for the period ended on March 31 2018, 2017, 2016,

2015, and 2014.

15.) In accordance with the requirements of the Act including the rules made there under, ICDR Regulations,

Guidance Note and Engagement Letter, we report that:

(iv) The “Restated Statement of Asset and Liabilities” of the Company as on March 31 2018, 2017,

2016, 2015, and 2014 examined by us, as set out in Annexure I to this report read with significant

accounting policies in Annexure IV has been arrived at after making such adjustments and regroupings

to the audited financial statements of the Company, as in our opinion were appropriate and more fully

described in notes to the restated summary statements to this report.

(v) The “Restated Statement of Profit and Loss” of the Company for the period ended on March 31

2018, 2017, 2016, 2015, and 2014 examined by us, as set out in Annexure II to this report read with

Significant Accounting Policies in Annexure IV has been arrived at after making such adjustments and

177

regroupings to the audited financial statements of the Company, as in our opinion were appropriate and

more fully described in notes to the restated summary statements to this report.

(vi) The “Restated Statement of Cash Flows” of the Company for the period ended on March 31 2018,

2017, 2016, 2015, and 2014 examined by us, as set out in Annexure III to this report read with

significant accounting policies in Annexure IV has been arrived at after making such adjustments and

regroupings to the audited financial statements of the Company, as in our opinion were appropriate and

more fully described in notes to restated summary statements to this report.

16.) Based on our examination, we are of the opinion that the restated financial statements have been prepared:

d) Using consistent accounting policies for all the reporting periods.

e) Adjustments for prior period and other material amounts in the respective financial years to which they

relate.

f) There are no extra-ordinary items that need to be disclosed separately in the accounts and requiring

adjustments.

17.) Audit for the period ended on March 31, 2017, 2016, 2015, and 2014 was conducted by Shiv K Gupta &

Associates and audit for the period ended on March 31, 2018 was conducted by Vijay Darji and

Associates. The financial report included for these period is based solely on the report submitted by them.

18.) We have also examined the following other financial information relating to the Company prepared by the

Management and as approved by the Board of Directors of the Company and annexed to this report relating

to the Company for the period ended on March 31 2018, 2017, 2016, 2015, and 2014 proposed to be

included in the Prospectus / Prospectus (“Offer Document”).

Annexure to Restated Standalone Financial Statements of the Company:

I. Summary statement of standalone assets and liabilities, as restated as appearing in ANNEXURE I

to this report;

II. Summary statement of standalone profit and loss, as restated as appearing in ANNEXURE II

to this report;

III. Summary statement of standalone cash flow as restated as appearing in ANNEXURE III to

this report;

IV. Significant accounting policies as restated as appearing in ANNEXURE IV to this report;

V. Details of share capital as restated as appearing in ANNEXURE V to this report;

VI. Details of reserves and surplus as restated as appearing in ANNEXURE VI to this report;

VII. Details of long term borrowings as restated as appearing in ANNEXURE VII to this report;

VIII. Details of non current investment as restated as appearing in ANNEXURE VIII to this report;

IX. Details of deferred tax asset/liability as restated as per ANNEXURE IX to this report;

X. Details of short term borrowings as restated as appearing in ANNEXURE X to this report;

XI. Details of trade payables as restated as appearing in ANNEXURE XI to this report;

XII. Details of other current liabilities as restated as appearing in ANNEXURE XII to this report;

XIII. Details of short term Provisions as restated as appearing in ANNEXURE XIII to this report;

XIV. Details of fixed assets as restated as appearing in ANNEXURE XIV to this report;

XV. Details of long term loans and advances as restated as appearing in ANNEXURE XV to this

report;

XVI. Details of trade receivables as restated as appearing in ANNEXURE XVI to this report;

XVII. Details of cash & cash equivalents as restated as appearing in ANNEXURE XVII to this report;

XVIII. Details of short term loans & advances as restated as appearing in ANNEXURE XVIII to this

report;

XIX. Details of Other Current Assets as restated as appearing in ANNEXURE XIX to this report;

XX. Details of Other Non-Current Assets as restated as appearing in ANNEXURE XX to this report;

XXI. Details of inventories as restated as appearing in ANNEXURE XXI to this report;

XXII. Details of revenue from operations as restated as appearing in ANNEXURE XXII to this report;

XXIII. Details of other income as restated as appearing in ANNEXURE XXIII to this report;

178

XXIV. Details of Raw Material Consumed as restated appearing in ANNEXURE XXIV to this report:

XXV. Details of Changes in Inventories as restated as aapearing in ANNEXURE XXV to this report:

XXVI. Details of Related Party Transactions as restated as appearing in ANNEXURE XXVI to this

report;

XXVII. Summary of significant accounting ratios as restated as appearing in ANNEXURE XXVII to this

report,

XXVIII. Capitalization Statement as at March 31, 2018 as restated as appearing in ANNEXURE XXVIII to

this report;

XXIX. Statement of tax shelters as restated as appearing in ANNEXURE XXIX to this report

19.) The report should not in any way be construed as a re-issuance or re-dating of any of the previous audit

reports issued by any other firm of chartered accountants nor should this report be construed as a new

opinion on any of the financial statements referred to therein.

20.) We have no responsibility to update our report for events and circumstances occurring after the date of the

report.

21.) In our opinion, the above financial information contained in Annexure I to XXVII of this report read with

the respective significant accounting policies and notes to restated summary statements as set out in

Annexure IV are prepared after making adjustments and regrouping as considered appropriate and have

been prepared in accordance with the Act, ICDR Regulations, Engagement Letter and Guidance Note.

(b.) Our report is intended solely for use of the management and for inclusion in the Offer Document in

connection with the SME IPO. Our report should not be used, referred to or adjusted for any other

purpose except with our consent in writing.

22.) Consequently, the financial information has been prepared after making such re-groupings and adjustments

as were, in our opinion, considered appropriate to comply with the same. As a result of this re-grouping and

adjustments, the amount reported in financial information may not necessarily be same as those appearing

in the respective audited financial statements for the relevant years.

For Vijay Darji and Associates

Chartered Accountants

Firm Registration No.: 118614W

CA Vijay Darji

Proprietor

Membership No.: 105197

Place: Mumbai

Date: 10th August, 2018

179

Annexure-I

Statement of Standalone Assets and Liabilities, as Restated (₹ In

Lakhs)

(₹ In Lakhs)


2018 2017 2016 2015 2014



g) Share Capital 600.00 300.00 300.00 300.00 300.00

h) Reserves & Surplus 1455.28 1551.00 1471.54 1437.10 1408.61


Pending Allotment






Current Liabilities


(b) Trade Payables 2049.30 1716.80 1431.86 1607.86 1623.59



T O T A L 5508.90 4861.31 3859.37 4120.78 4116.98

ASSETS

Non-Current Assets

(a) Fixed Assets

- Tangible Assets 375.34 414.75 348.52 453.14 550.27






Advances 110.80 114.00 142.48 149.83 154.08


Current Assets

a. Inventories 727.55 541.19 665.71 667.33 605.00




e. Other Current Assets - - - 24.74 45.17

T O T A L 5508.90 4861.31 3859.37 4120.78 4116.98

Annexure-II

Statement of Standalone Profit & Loss, as Restated

(₹ In Lakhs)


2018 2017 2016 2015 2014

Revenue:


Taxes)

5384.92 6331.04 5364.26 6051.77 5735.63

Other Income 23.32 17.24 18.18 19.08 16.43

Total Revenue 5408.24 6348.28 5382.44 6070.84 5752.05

180

Expenses:



Purchase of Stock-in -Trade - - - - -


goods, work-in-progress and

Stock-in-Trade

(22.73) (24.98) 70.67 (76.84) 72.90


Financial Cost 58.23 55.28 57.14 69.99 85.27


expenses

49.99 57.68 55.63 101.90 74.34

Others Expenses 238.01 185.45 261.78 135.49 140.39

Total Expenses 5125.44 6212.92 5333.71 6018.29 5681.71



282.80 135.36 48.74 52.56 70.34



items and tax (A-B)

282.80 135.36 48.74 52.56 70.34




Tax expense :

Current tax 74.15 34.85 19.20 22.39 13.47

Deferred Tax 3.00 (15.15) (7.19) (10.18) (1.70)


Minority Interest ----- ----- ----- ----- -----


Tax-PAT 205.65 115.66 36.73 40.35 49.22

Note: Manufacturing and operating cost added to cost of material consumed should be shown separately .

Annexure-III

Statement of Standalone Cash Flow, as Restated

(₹ in Lakhs)


2018 2017 2016 2015 2014


Activities:

Net Profit before tax as per Profit And

Loss A/c

282.80 135.36 48.74 52.56 70.34

Adjustments for:

Depreciation & Amortisation Expense 49.99 57.68 55.63 101.90 74.34

Interest Income (16.61) - 39.30 52.59 68.92

Finance Cost 58.23 - - - -

Dividend Received (6.71) - - - -

Deferred Tax Adjustment (1.36) - - - -

Income tax adjustment (74.15) (34.85) - - -

MAT Adjustment - (36.20) - - -

Provision for Gratuity - - 2.77 - -



Capital Changes

292.19 121.99 227.98 207.04 213.60


Decrease / (Increase) in Current /

Non-Current Assets 65.29 (426.92) - - -

(Decrease) / Increase in Current /

Non-Current Liabilities 393.89 639.15 - - -

181

Trade Receivables - - 30.33 15.96 (568.90)

Other Receivables - - 15.85 17.78 29.81

Inventories - - 1.62 (62.34) 217.72

Trade Payables - - (177.91) (15.73) 501.11

Other Current Liabilities - - (134.65) (6.80) (129.42)

Cash Generated From Operations 459.18 212.23 (264.75) (51.13) 50.31


Net Income Tax paid/ refunded - - 8.50 (15.89) (27.92)



751.37 334.21 (28.27) 140.02 235.99


Activities:

Net (Purchases)/Sales of Fixed Assets

(including capital work in progress)

(748.50) (616.52) (32.55) (5.84) (85.98)

Loans & Advances - - - 4.26 13.44

Investments - - 5.25 (59.01) 15.00

Interest on FD - - 17.84 17.40 16.35

Interest & Dividend received 23.32 - - - -

Net (Increase)/Decrease in Long

Term Loans & Advances

- - - - -



(725.18) (616.52) (9.46) (43.19) (41.18)


Activities:

Proceeds From issue of Share Capital - - - - -

Net Increase/(Decrease) in Long Term

Borrowings

49.41 283.33 (8.71) (19.45) 9.71

Net Increase/(Decrease) in Short Term

Borrowings

- - - - -

Net Increase/(Decrease) in Other Long

Term Liabilities

- - - - -

Interest on Borrowings (58.23) - (57.14) (69.99) (85.27)



(8.82) 283.33 (65.85) (89.44) (75.56)



17.37 1.03 (103.58) 7.39 119.25



278.10 277.07 380.65 373.26 254.01

Cash & Cash Equivalents As At End

of the Year 295.47 278.10 277.07 380.65 373.26

Annexure-IVA

Statement of Significant Accounting Policies

18) Background

Preet Remedies Limited was incorporated on February 10th, 2005 as a Private Limited company (CIN:

U24230CH2005PTC27954) under the Companies Act, 1956. The principal objective of the company is to

carry on the business of manufacturing pharmaceutical formulations. The Company comes under the top

contract manufacturing companies in India. The Company has the capacity to deliver all type of product

range such as a Tablets Capsules, Ointment, Cream, Gel, Lotion, Shampoo. Being a leading third-party

Pharma Manufacturing, we make use of best quality raw material and cutting-edge tools. The financial

statements have been prepared to comply in all material respects with the accounting standards specified

under 133 of companies Act, 2013 (“the Act”) read with rule 7 of companies (Accounts) Rules, 2014 and

the relevant provisions of the Act. The financial statements have been prepared under the historical cost

conversion on an accrual basis. The accounting policies have been consistently applied by the company.

19) Basis of preparation of financial statements

182

All assets & liabilities have been classified as current &Non-Current as per company’s normal opening

cycle & other criteria set out in the Revised Schedule III.

Based on the nature of services of the company, for the purpose of current/ non-current classification of

assets & liabilities, 12 months have been considered as is operating cycle

20) Use of estimates

The preparation of financial statements requires management to make estimates and assumptions that affect

amounts in the financial statements and reported notes thereto. Actual results could differ from these

estimates. Differences between the actual result and estimates are recognized in periods in which the results

are known/ materialized.

21) Fixed Assets

Fixed assets are stated at historical cost/revalued value less accumulated depreciation and impairment

losses, if any. Cost includes purchase price and all other attributable cost to bring the assets to its working

condition for the intended use. Borrowing costs relating to acquisition/construction of fixed assets which

takes substantial period of time to get ready for its intended use are also included to the extent they related

to the period till such assets are ready for commercial use.

Subsequent expenditures related to an item of tangible asset are added to its book value only if they increase

the future benefits from the existing asset beyond its previously assessed standard of performance.

Projects under which assets are not ready for their intended use are shown as Capital Work-in-Progress.

Cost includes cost of land, materials, construction, services, borrowing costs and other overheads relating to

projects.

22) Depreciation

Depreciation on fixed assets for the year ended on March 31, 2013 and 2014 is calculated on WDV basis

for all assets using the rates prescribed under Schedule XIV of the Companies Act, 1956. Depreciation on

fixed assets purchased after April 1, 2014 is calculated on WDV basis for all assets using the useful life as

prescribed under Schedule II of the Companies Act, 2013.

23) Investments

Long term investment is stated at cost. However, when there is decline, other than temporary, in the value

of long term investment, the carrying amount is reduced to recognize the decline.

24) Borrowing Costs

Borrowing cost includes interest and amortization of ancillary costs incurred in connection with the

arrangement of borrowings. Borrowing costs that are directly attributable to the acquisition or Construction

of qualifying asset are capitalized as part of the cost of that asset. The amount of borrowing costs eligible

for capitalization is determined in accordance with Accounting Standard 16 (AS 16) on "Borrowing Costs".

Other borrowing costs are recognized as an expense in the period in which they are incurred.

25) Impairment of Asset

The company assesses, at each reporting date determine whether there is any indication of impairment in

the carrying amount of the Company's fixed assets. If any such indication exists, the asset's recoverable

amount is estimated. Where the carrying amount of an asset exceeds its recoverable amount, the asset is

considered impaired and is written down to its recoverable amount

26) Cash Flow Statement

183

Cash flow are reported using the indirect method, whereby profit before tax is adjusted for the effects of

transactions of non cash nature, any deferrals or accruals of past or future operating cash receipts or

payments and item of income or expenses associated with investing or financial cash flow. The cash flows

from operating, investing and financial activities of the company are segregated.

27) Revenue Recognition

Revenue in respect of sale of product and scraps in recognized on accrual basis, and the amount of revenue

is measurable.

28) Earnings per share

The basic earning per shares is computed by dividing the net profit/ (loss) attributable to the equity

shareholders for the year by the weighted average number of equity shares outstanding during the reporting

period. For the purpose of calculating diluted earnings per shares, net profit after tax for the year available

for equity shareholders and the weighted average number of equity shares outstanding during the year are

adjusted for the effects of all dilutive potential equity shares.

29) Foreign currency transactions

Normal Exchange differences at the time of settlement are dealt with in the Profit & Loss account.

Monetary assets and liabilities in foreign currency existing at the Balance Sheet date are translated at the

year-end exchange rates. Exchange difference arising on forward contract is recognised as income or

expense over the life of the contract. Any Profit or loss arising on cancellation or renewal of a forward

exchange contract is recognised-as-income or as expense for that period. Exchange rate difference in

respect of purchase of Fixed Assets is adjusted in the carrying amount of respective Fixed Assets.

30) Taxes on Income

Tax comprises current and deferred tax. Current income tax is measured at the amount expected to be paid

to the tax authorities in accordance with the income Tax Act. Deferred income taxes reflects the impact of

current period timing difference between taxable income and accounting income for the period and reversal

of timing difference of earlier years.

Minimum Alternative tax (MAT) is recognised as an asset only when, and to the extent there is convincing

evidence that the company will pay normal income tax during the specific period. In the MAT credit

becomes eligible to be recognised as an asset in accordance the recommendations contained in the Guidance

note issued by ICAI, the said asset is created by the way of credit to the statement of profit & loss & shown

as MAT Credit Entitlement.

The company reviews the same at each balance sheet date and write down the carrying amount of MAT

Credit Entitlement to the extent there is no longer convincing evidence to the effect that the company will

pay normal income tax during the specific period.

31) Provident fund/ESIC Contribution

Provident fund is a defined benefits scheme and the contributions are charged to profit and loss account on

accrual basis. The company’s contribution towards ESIC is charge to statement of profit and loss.

32) Inventory

The Stock of Goods at the year-end are valued in accordance with revised AS-2 “Valuation of Inventories”

issued by ICAI. Accordingly, the method of valuation adopted is as under:

Finished Goods – At lower of Cost or Net Realizable Value

Raw Material & Packing Material – At Cost Price

Work-in-Progress – At Material Cost plus Apportioned Manufacturing Overheads

33) Contingent Liabilities & Provisions

184

Possible obligation that arises from past events whose existence will be confirmed by the occurrence or

non-occurrence of one or more uncertain future events beyond the control of the Company or a present

obligation that is not recognized because it is probable that an outflow of resources will be required to settle

the obligation is reported as contingent liability. In rare cases, when a liability cannot be measured reliably,

it is classified as contingent liability. The Company does not recognize a contingent liability but discloses

its existence in the financial statements.

34) Segment Reporting as per AS- 17, is not applicable to company.

Annexure-IV B

Reconciliation of Restated Profit:

(₹ In Lakhs)

Adjustments for For the year ended March 31,

2018 2017 2016 2015 2014

Net Profit/(Loss) after Tax as per

Audited Profit & Loss Account

205.65 115.66 36.73 40.35 49.22

Adjustments for:

Provision for Gratuity (23.34) (19.88) (9.70) (6.93) (5.04)

Net Profit / (Loss) After Tax as

Restated

182.31 95.78 27.03 33.42 44.18

Explanatory notes to the above restatements made in the audited financial statements of the Company for the

respective years.

Adjustments having impact on Profit

Provision for Gratuity–Gratuity provision are made as per actuarial valuation report as specified in AS-15.

Material Regrouping

w.e.f, April 1, 2014, Schedule III notified under the Companies Act, 2013 has become applicable to the

Company for preparation and presentation of its financial statements. Revised Schedule VI notified under the

Companies Act, 1956 became applicable to the Company from April 1, 2011, for preparation and presentation

of its financial statements. The adoption of Schedule III / Revised Schedule VI does not impact recognition and

measurement principles followed for preparation of financial statements.

There is no significant impact on the presentation and disclosures made in the financial statements on adoption

of Schedule III as compared to Revised Schedule VI. Appropriate adjustments have been made in the restated

summary statements, wherever required, by a reclassification of the corresponding items of income, expenses,

assets, liabilities and cash flows in order to bring them in line with the groupings as per the audited financial

statements of the Company, prepared in accordance with Schedule III and the requirements of the Securities and

Exchange Board of India (Issue of Capital & Disclosure Requirements) Regulations, 2009 (as amended)

Annexure-V

Details of Share Capital:

(₹ in Lakhs)

Particulars


2018

2017

2016

2015

2014

Equity Share Capital :

Authorised:

Equity Shares of ₹ 10 each 1000.00 500.00 500.00 500.00 500.00

TOTAL 1000.00 500.00 500.00 500.00 500.00

Issued, Subscribed and Paid Up

Equity Shares of ₹ 10 each

600.00

300.00

300.00

300.00

300.00

(₹ 100 each for financial year 2012 -

2013 to 2016 - 2017)

600.00 300.00 300.00 300.00 300.00

Reconciliation of number of shares

185

outstanding at the end of the year:

Equity Shares at the beginning of the

year

30 30 30 30 30

Add: Shares issued during the year - - - - -

Add: Bonus shares issued during the

year

30 - - - -

TOTAL 60 30 30 30 30

Details of Shareholders holding more than 5% of the aggregate shares of the Company:

Particulars


2018 2017 2016

2015 2014


16,84,000

8,52,000

8,52,000

8,52,000

8,52,000

Harpreet Singh

9,04,000

4,52,000

4,52,000

4,52,000

4,52,000

Sanjay Dhir

8,00,000

4,00,000

4,00,000

4,00,000

4,00,000

Satish Kumar

8,88,000

4,44,000

4,44,000

4,44,000

4,44,000

HimjyotiDhir 9,04,000 4,52,000 4,52,000 4,52,000 4,52,000

Jasbir Singh Kalra 8,00,000 4,00,000 4,00,000 4,00,000 4,00,000

TOTAL 59,80,000 30,00,000 30,00,000 30,00,000 30,00,000

Annexure-VI

Details of Reserves and Surplus:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Profit & Loss Account

(closing balance)

1456.41 1250.77 1135.11 1098.38 1058.03

Revaluation Reserve 0.00 0.00 0.00 0.00 0.00

Land

Building

Opening balance

Less Deductions

Closing balance

General Reserve:

Opening Balance 271.84 308.04 310.33 322.20 322.20

Amt trfd during the

year/adj u/s 115JAA

(336.21) (36.20) (2.29) (10.80) -

Amt Trfd during the year

for depreciation relating to

earlier year

34.85 - - (1.07) -

Capital Investment Subsidy 28.39 28.39 28.39 28.39 28.39

Investment Revaluation

Reserve

Closing Balance (1.13) 300.23 336.43 338.72 350.59

TOTAL 1455.28 1551.00 1471.54 1437.10 1408.62

Annexure-VII

Details of Long Term Borrowing:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Term Loan, Secured

Term Loan From Bank 319.88 244.76 17.42 - -

186

Vehicle Loan 41.03 66.74 10.74 19.45 38.89

Less-Current maturity - - - - -

TOTAL 360.91 311.50 28.16 19.45 38.89


2018 2017 2016 2015 2014

UNSECURED LOANS - - - - -

Details of Non Current Investments Annexure-VIII


2018 2017 2016 2015 2014

Alpha products Baddi -a firm in which company is interested as a Partner

205.66 205.66 205.66 210.91 225.91

Investment in Zenlabs Ethica Limited

251.02 251.02 157.06 157.06 157.06

Investment in SWMPL Nalagarh

1.00 1.00 1.00 1.00 1.00

Investment in Oasis Pharma & Phytomolecules Private Limited

74.01 74.01 74.01 74.01 -

TOTAL 531.69 531.69 437.73 442.98 383.97

Annexure-IX

Details of Deferred Tax Asset/Liability:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Deferred Tax Liabilities

Depreciation Opening balance (38.59) (23.44) (16.24) (6.06) (4.36)

During the Year 3.00 (15.15) (7.19) (10.18) (1.70)

TOTAL (35.59) (38.59) (23.44) (16.24) (6.06)

Annexure-X

Details of Short Term Borrowing:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Loans repayable on demand

from Banks

Secured

- - - -

Current Maturities of Long

Term Debts

96.95 89.79 8.70 19.45 17.96

Working Capital Loan from

Banks:

BOI Cash Credit

BOI Cash Credit - - 398.15 585.99 548.57

BOI Loan against FDR 135.01 - 51.22 51.40 56.02

HDFC Cash Credit 530.33 451.27 - - -

TOTAL 762.29 541.06 458.06 656.84 622.55

187

Annexure-XI

Details of Trade Payables:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Trade payables:

Sundry Creditors for Trade 2049.29 1716.80 1431.86 1598.84 1622.36

Current Account - - - 9.02 -

Sundry Creditors Capital - - - - 1.23

TOTAL 2049.29 1716.80 1431.86 1607.86 1623.59

Annexure-XII

Details of Other Current Liabilities:

(₹ in Lakhs)

Particulars As at March 31

2018 2017 2016 2015 2014

Expenses payable 237.13 391.40 137.08 78.37 115.35

statutory remittances 13.75 6.66 8.27 1.61 1.55

advances from debtors - -

HDFC Bank car loan- current

maturities

- -

TOTAL 250.88 398.06 145.35 79.98 116.90

Annexure-XIII

Details of Short Term Provision:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Gratuity Liability 23.34 19.88 9.70 6.93 5.04

Bonus 4.68 4.17 4.00 5.23 1.39

Provision for Tax (Net of

Advance Tax)

2.22 15.85 10.70 7.39 -

Provision for Tax (For previous

year)

- 2.99 - - -

TOTAL 30.24 42.90 24.40 19.55 6.43

188

Details of Fixed Assets Annexure -XIV

FY 2013-2014

(₹ in Lakhs)

Particulars


Balance as at

April 01, 2013 Additions

Dedu

ction

durin

g the

year

Balance

as at

March

31, 2014

Balance

as at

April 01,

2013

Depre

ciation

charge

for the

year

Adjus

tment

s

On

Dispos

als

Upto

March 31,

2014

Balance

as at

March

31,

2014

Balanc

e as at

March

31,

2013

Fixed Assets

Tangible Assets

Land 108.98 108.98 108.98 108.98

Building 178.94 178.94 68.46 11.05 79.51 99.43 110.48

Plant and machinery 387.77 40.61 428.38 198.85 29.71 228.56 199.82 188.92

Electrical Equipment 69.30 2.38 71.68 35.00 4.83 39.83 31.85 34.30

Furniture and fixture 67.03 67.03 39.50 4.98 44.48 22.55 27.53

Total (i) 812.02 42.99 - 855.01 341.81 50.57 392.38 462.63 470.21

Office equipment

Vehicles 141.10 38.55 179.65 85.85 19.96 105.81 73.84 55.25

Computers 20.06 1.45 21.51 16.55 1.78 18.33 3.18 3.51

Lab Equipment 14.81 1.48 16.29 6.69 1.72 8.41 7.88 8.12

Mobile Phone 2.15 1.50 3.65 0.63 0.30 0.93 2.72 1.52

Total (ii) 178.12 42.98 - 221.10 109.72 23.76 133.48 87.62 68.40

TOTAL (i) + (ii) 990.14 85.97 - 1076.11 451.53 74.33 525.86 550.25 538.61

Year 2014-2015

(₹ in Lakhs)

189

Particulars


Balance as

at April 01,

2014

Additio

ns

Dedu

ction

durin

g the

year

Balance

as at

March

31, 2015

Balance

as at

April

01,

2014

Deprecia

tion

charge

for the

year

Adjustm

ents

On

dispos

als

Balance

as at

March

31,

2015

Balance

as at

March

31,

2015

Balance

as at

March

31,

2014

Fixed Assets

Land 108.98 108.98 108.98 108.98

Building 178.94 178.94 79.51 9.38 88.89 90.05 99.43

Plant and machinery 428.38 1.93 430.31 228.56 40.69 269.25 161.06 199.82


Furniture and fixture 67.03 0.46 67.49 44.48 8.22 52.7 14.79 22.55

Total (i) 855.01 3.16 858.17 392.38 71.84 464.22 393.95 462.63

Office equipment

Vehicles 179.65 179.65 105.81 24.29 0.46 130.56 49.09 73.84

Computers 21.51 1.49 23.00 18.33 1.86 0.46 20.65 2.35 3.18

Lab Equipment 16.29 0.82 17.11 8.41 2.43 10.84 6.27 7.88

Mobile Phone 3.65 0.36 4.01 0.93 1.46 0.14 2.53 1.48 2.72

Fire Fighting Equipment

Generator

Lift

Marg Software

Printer

Refrigerator

Shed

Transformer

Tube well

Weighing Scale

Total (ii) 221.10 2.67 223.77 133.48 30.04 1.06 164.58 59.19 87.62

TOTAL (i) + (ii) 1076.11 5.83 1081.94 525.86 101.88 1.06 628.80 453.14 550.25

Building under Construction

Year 2015-2016

(₹ in Lakhs)

Particulars Gross Block Depreciation Net Block

190

Balance

as at

April

01,

2015

Additi

ons

Deducti

on

during

the

year

Balance

as at

March

31,

2016

Balance

as at

April

01,

2015

Deprecia

tion

charge

for the

year

Adjustm

ents

On

dispos

als

Balance

as at

March

31,

2016

Balance

as at

March

31,

2016

Balance

as at

March

31,

2015

Fixed Assets

Land 108.98 108.98 108.98 108.98

Building 178.94 4.86 183.80 88.89 8.36 97.25 86.55 90.05

Plant and machinery 430.31 34.52 178.01 269.25 16.36 193.39 92.22 85.79 161.06


Furniture and fixture 67.49 67.49 52.70 5.03 57.73 9.76 14.79

Total (i) 858.17 41.42 612.77 464.22 36.93 193.39 307.76 305.01 393.95

Office equipment

Vehicles 179.65 179.65 130.56 14.47 145.03 34.62 49.09

Computers 23.00 0.61 23.61 20.65 1.45 22.10 1.51 2.35

Lab Equipment 17.11 1.14 18.25 10.84 2.03 12.87 5.38 6.27

Mobile Phone 4.01 1.25 5.26 2.53 0.76 3.29 1.97 1.48


Generator

Lift

Marg Software

Printer

Refrigerator

Shed

Transformer

Tube well

Weighing Scale

Total (ii) 223.77 3.00 226.77 164.58 18.71 183.29 43.48 59.19

TOTAL (i) + (ii) 1081.94 44.52 839.54 628.80 55.64 193.39 491.05 348.49 453.14

Building under Construction

FY 2016-2017

(₹ in Lakhs)


191

Balance

as at

April

01,

2016

Additio

ns

Deduc

tion

during

the

year

Balance

as at

March

31,

2017

Balance

as at

April

01,

2016

Deprecia

tion

charge

for the

year

Adjustm

ents

On

dispos

als

Balance

as at

March

31, 2017

Balance

as at

March

31, 2017

Balance

as at

March

31, 2016

Fixed Assets

Tangible Assets

Land 108.98 108.98 108.98 108.98

Building 183.80 183.80 97.25 8.15 105.40 74.40 86.55

Plant and machinery 178.01 178.01 92.22 16.24 108.46 69.55 85.79

Electrical Equipment 74.49 74.49 60.56 4.07 64.63 9.86 13.93


Total (i) 612.77 0.32 613.09 307.76 31.30 339.06 274.03 305.01

Office equipment

Vehicles 179.65 117.87 297.52 145.03 22.80 167.83 129.69 34.62

Computers 23.61 23.61 22.10 0.49 22.59 1.02 1.51

Lab Equipment 18.25 4.20 22.45 12.87 2.09 14.96 7.49 5.38

Mobile Phone 5.26 1.51 6.77 3.29 1.01 4.30 2.47 1.97

Fire Fighting Equipments - - - - - - - - -

Generator - - - - - - - - -

Lift - - - - - - - - -

Marg Software - - - - - - - - -

Printer - - - - - - - - -

Refrigerator - - - - - - - - -

Shed - - - - - - - - -

Transformer - - - - - - - - -

Tubewell - - - - - - - - -

Weighing Scale - - - - - - - - -

Total (ii) 226.77 123.58 350.35 183.29 26.39 209.68 140.67 43.48

GRAND TOTAL (I+II)

839.54 123.90 963.44 491.05 57.69 548.74 414.70 348.49

Building under Construction 378.57 378.57 378.58

P&M under installation 114.04 114.04 114.04

FY 2017-2018

(₹ in Lakhs)


192

Balance

as at

April

01,

2017

Additi

ons

Deducti

on

during

the

year

Balance

as at

March

31, 2018

Balance

as at

April

01,

2017

Deprecia

tion

charge

for the

year

Adjustm

ents

On

dispos

als

Balance

as at

March

31, 2018

Balance

as at

March

31, 2018

Balance

as at

March

31, 2017

Fixed Assets

Tangible Assets

Land 108.98 108.98 108.98 108.98

Building 183.80 183.80 105.40 7.38 112.78 71.02 78.40

Plant and machinery 178.01 178.01 108.46 13.16 121.62 56.39 69.55

Electrical Equipment 74.49 74.49 64.63 2.41 67.04 7.45 9.86


Total (i) 613.09 6.17 619.26 339.06 25.86 364.92 254.34 274.03

Office equipment

Vehicles 297.52 297.52 167.83 20.74 188.57 108.95 129.69

Computers 23.61 2.00 25.61 22.59 0.36 22.95 2.66 1.02

Lab Equipment 22.45 1.39 23.84 14.96 2.03 16.99 6.85 7.49

Mobile Phone 6.77 1.02 7.79 4.30 0.99 5.29 2.50 2.47


Generator

Lift

Marg Software

Printer

Refrigerator

Shed

Transformer

Tubewell

Weighing Scale

Total (ii) 350.35 4.41 354.76 209.68 24.12 233.80 120.96 140.67

Total (i) + (ii) 963.44 10.58 974.02 548.74 49.98 598.72 375.30 414.70

Building under Construction 378.57 362.23 740.80 740.80

P&M under installation 114.04 337.51 434.13 434.13

Electrical Equipment under

installation

55.59 55.59 55.59

193

Annexure-XV

Details of Long Term Loans and Advances:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Security Deposits

Security Deposits

(with Govt, public and other)

39.81 17.90 17.90 10.59 10.29

MAT Credit Entitlement 70.89 96.00 124.48 139.14 143.70

Others 0.10 0.10 0.10 0.10 0.10

TOTAL 110.80 114.00 142.48 149.83 154.09

Annexure-XVI

Details of Trade Receivables:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Outstanding for a period more than 6


payment

405.37 390.90 78.49 173.25 145.20

Outstanding for a period less than 6


payment

1583.25 2050.24 1866.46 1802.03 1846.04

TOTAL 1988.62\ 2441.14 1944.95 1975.28 1991.24

Annexure-XVII

Details of Cash & Cash Equivalents:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Cash In Hand 15.71 9.81 15.30 10.98 15.06

Balance with bank:

--In current accounts 30.94 34.42 43.38 167.32 171.51

--Fixed deposits with Bank 248.82 233.87 218.40 202.35 186.68

TOTAL 295.47 278.10 277.08 380.65 373.25

Annexure-XVIII

Details of Short Term Loan and Advances:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Short Term Loans And Advances

Balance with govt authorities 180.19 1.97 11.76 4.96 5.34

Security Deposits 0.20 0.20 0.20 0.20 0.27

Advances to Creditors 0.80 0.65 0.43 -

Advances to employees 18.99 0.69 2.71 0.60 0.24

Advances For Expenses 1.00 3.00 1.57 1.35 1.43

Other Advances 12.94 2.58 2.58 3.05 0.66

TOTAL 213.32 9.25 19.47 10.59 7.94

194

Annexure-XIX

Details of Other Current Assets:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Others Current Assets

Interest Accrued - - - - -

VAT Receivable - - - 24.74 45.17

Prepaid Expenses - - - - -

TOTAL - - - 24.74 45.17

Annexure-XX

Details of Other Non-Current Assets:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Deposits - - - - -

Other non-current assets - - -

TOTAL - - - - -

Annexure-XXI

Details of Inventories:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Inventories

Raw Materials & Packing

Materials

663.52 499.89 649.39 580.34 594.84

Work in Progress 64.03 27.17 12.65 82.84 7.78

Finished goods / Trading Stock - 14.13 3.67 4.15 2.38

TOTAL 727.55 541.19 665.71 667.33 605.00

Annexure-XXII

Details of Revenue from Operations: (₹ in Lakhs)


2018 2017 2016 2015 2014

Revenue From Operations

Manufacturing Goods - Domestic 5384.92 6331.04 5364.26 6051.77 5735.63

TOTAL 5384.92 6331.04 5364.26 6051.77 5735.63

Annexure-XXIII

Details of Other Income:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Interest on FDR 16.61 17.19 17.84 17.40 16.35

Dividend Income 6.71 0.03 0.03 0.02 0.01

Duty Drawback - - - - -

Insurance Claim - - - - -

Interest on Refund - - - - -

195

Interest from HPSEB - 0.02 0.32 0.34 -

Debit/Credit Balance W/off - - - - -

Discount Received - - - 1.32 0.06

Product Development Charges - - - - -

Other Income - - - - -

TOTAL 23.32 17.24 18.19 19.08 16.42

Annexure-XXIV

Cost of Material Consumed:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Opening stock 499.89 649.39 580.34 594.84 739.66

Add: Purchase 4344.88 5144.20 4352.62 5189.42 4652.59

Less closing stock (663.52) (499.89) (649.39) (580.34) (594.84)

TOTAL 4181.26 5293.69 4283.58 5203.92 4797.41

Annexure-XXV

Change in Inventories of Finished Goods and Stock in Process:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Stock In Process & Finished

Goods

Stock-in-Process (closing stock

less opening stock)

36.86 14.52 (70.19) 75.06 1.65

Finished Goods (closing stock less

opening stock)

(14.13) 10.46 (0.48) 1.77 (74.55)

TOTAL 22.73 24.98 (70.67) 76.83 (72.90)

Employee Benefits Expense:

Salaries, Wages 329.05 339.98 363.54 383.72 344.05

Contribution to PF & Other Funds 5.24 5.06 4.63 5.73 5.30

Staff and labour Welfare Expenses 3.43 8.41 6.88 6.70 7.52

Provision for Gratuity 3.70 5.35 2.77 1.89 5.04

Bonus & Incentives Expense 6.06 9.66 4.00 5.23 1.38

TOTAL

347.48

368.46

381.82

403.27

363.29

Finance Cost :

Interest Paid on Term Loan 7.30 8.77 57.14 69.99 85.27

Bank Charges 1.11 10.41 3.73 1.55 1.46

Interest on Car Loan - - - - -

Interest Paid on Working Capital 50.93 46.51 - - -

Interest Expense on Statutory &

Delayed Payment

- - - - -

TOTAL 59.34 65.69 60.87 71.54 86.73


Depreciation of Tangible assets

TOTAL

Other Expenses:

Manufacturing & Operating

196


2018 2017 2016 2015 2014

Costs

Job work 120.50 125.58 - - -

Power & Fuel 77.65 75.10 67.90 90.89 90.87

Packing Material Expenses 0.32 0.44 0.25 - -

Repair to Machinery 5.18 17.01 11.56 20.10 17.85

Consumables / Stores 0.06 8.28 4.70 7.94 4.67

Production Expenses - Others 7.23 11.44 8.78 18.32 6.97

Lab Expenses 30.54 21.56 1.44 16.26 9.95

Freight & Carriage Inward 31.71 17.94 15.46 23.53 17.80

Manufacturing Charges for Loan

License

- - 112.85 - -

Cylinder Charges - - 0.14 - -

Food Expenses (Factory) - - - 3.52

TOTAL 273.19 277.35 223.08 180.56 148.11

Administrative Expenses

Association Fee - - 0.25 - -

Travelling & Conveyance 28.61 21.06 18.22 19.38 10.66

Advertisement Expenses - - - - -

Directors Remuneration 80.40 24.60 24.60 24.60 21.60

Boarding & Lodging Expenses - - - - 0.01

Insurance Expenses 4.78 8.01 3.82 3.72 3.15

Printing & Stationery 6.26 3.21 6.84 4.40 7.98

Business Promotion Expenses 1.30 1.70 3.88 1.06 0.75

Job work chrgs & C& f Charges 0.40 - 1.15 - -

Tour & Travel Expenses - - - - -

Freight & Carriage Outward

Charges

3.60 12.20 10.51 13.93 14.34

Legal and Professional Charges 33.07 6.04 10.27 7.32 6.79

Pollution Control Expenses 1.41 0.03 0.41 1.57 0.70

Postage & Telegram Expenses 1.81 1.62 0.93 0.68 1.50

Loading & Unloading Expenses - - - - -

Festival Expenses 3.36 3.44 3.13 4.42 4.80

Telephone Expenses 6.10 6.67 7.20 5.32 5.27

Repairs & Maintenance Expenses 6.47 35.48 17.55 3.54 3.07

Charity & Donation Expenses 0.18 0.64 0.85 0.72 0.70

Miscellaneous Expenses 0.31 2.97 6.09 2.33 2.60

Office Expenses 1.02 1.37 4.54 2.15 0.67

Office Rent 27.46 20.63 16.04 13.11 14.89

Rebate & Discount - - 0.07 2.19 9.46

Meeting & Conference Expenses - - - - -

Rate, Fee & Taxes 5.51 2.74 0.20 0.34 2.37

Research & Development

Expenses

- - 15.34 - -

Vehicle Running & Maintenance

Expenses

0.18 0.27 3.95 3.73 5.03

Service Taxes 1.02 3.17 2.56 2.01 1.84

Security Expenses 21.74 18.20 16.92 16.31 14.79

Interest on Income Tax 0.75 - - - -

Packing Expenses 0.10 0.02 0.02 0.03 0.07

Procurement & Service Charges - 0.20 0.43 0.45 0.02

Product Approval Expenses - - 0.03 - 0.25

Pest Control Expenses - - - -

197


2018 2017 2016 2015 2014

Electricity & Water Expenses - - - -

Software Charges - - - -

Commission Expenses - - - -

Bad-Debts - - - -

Forfeiture of Earnest Deposit - - - - 5.00

Preliminary Expenses W/Off - - - -

Loss on Sale of Machinery - - 81.54 -

Auditor Remuneration 0.71 0.69 0.63 0.62 0.62

TOTAL

237.66 174.96 258.01 133.94 138.93

Selling & Distribution Expenses

Sales & Marketing Expenses 0.32 - - - -

TOTAL 0.32 - - - -

198

Annexure-XXVI

Details of Related Party Transactions:

Details of Related Party Transactions by Preet Remedies Limited Name Relatio

nship

Nature of

Transactio

n

Amount

of

Transact

ion upto

stub

Period if

applicabl

e

Amount

Outstandi

ng

as on Stub

Period, if

applicable

Payable/

(Receivab

le)

Amount

of

Transacti

on

upto31.03

.2017

Amount

out

Standing

as on

31.03.201

7

Payable/

(Receiva

ble)

Amoun

t of

Transa

ction

upto31.

03.216

Amount

out

Standing

as on

31.03.201

6

Payable/

(Receiva

ble)

Amount

of

Transact

ion in

2014 –

2015

Amount

out

Standing

as on

31.03.2015

Payable/

(Receivabl

e)

Amount of

Transactio

n in 2013 –

2014

Amount

out

Standing

as on

31.03.201

4

Payable/

(Receiva

ble)

Amount of

Transactio

n in 2012 –

2013

Amount out

Standing as

on

31.03.2013

Payable/

(Receivable)

Shiva

Traders

Related

Party

Purchase 19.59 11.98 33.05 19.14 44.73 76.38

Payable 4.96 4.31 2.00 3.99 0.91 14.88

Ultrachir

aonHelathcarePvt

Ltd

Related

Party

Purchase - - 3.34 92.98 224.86 1104.10

Sales 22.47 135.96 59.57 26.71 14.12 12.67

Receivable (99.87) (109.37) (73.37) 0.19

Payable 34.24 9.54

Precision

Polymer

Related

Party

Purchase 22.82 24.73 29.41 57.87 34.35 25.30

Payable 4.85 4.23 3.85 7.70 5.00

Preet

Plastic Industry

Related

Party

Purchase 0.17 0.19 - 1.11 - 3.78

Payable 0.36 11.21 0.14

Preet

Packaging

solution

Related

Party

Purchase 23.47 - 22.89 23.62 26.63 17.49

Payable 7.80 6.22 7.44 6.89

1.24

Oasis

Pharma and

Phytomle

cules

Related

Party

Purchase 3.86 154.42 102.80 - - -

Sales 303.04 582.99 321.17 4.26 - -

Receivable (459.92) (376.45) (316.36) (4.27)

Alpha

Products

Related

Party

Purchase 20.83 4.89 0.10 - - -

Sales 20.92 73.30 121.41 0.14 - -

Receivable (31.37) (74.68) (107.37)

-

Quixotic

Healthcare

Related

Party

Purchase 232.28 8.74 20.71 25.09 - -

Sales 32.82 104.11 3.70 - - -

Recevable (57.29)

Payable 195.16 - 3.23 38.08

ZenlabsE

thica Limited

Related

Party

Purchase - - - - -

Sales 2005.37 2308.37 2110.90 2744.35 2673.81 1642.88

Receivable (545.57) (963.36) (572.62) (1107.68) (1079.59) (695.72)

199

(₹ In Lakhs)

Details of Related Party Transactions by Zenlabs Ethica and Oasis Pharma and PhytomoloculesPvt Ltd with related party Other than Preet Remedies

Limited

Name Relatio

nship

Nature

of

Transact

ion

Amount of

Transactio

n upto

stub

Period if

applicable

Amount

Outstandi

ng

as on Stub

Period, if

applicable

Payable/

(Receivab

le)

Amount

of

Transacti

on upto

31.03.201

7

Amoun

t out

Standi

ng as

on

31.03.2

017

Payabl

e/

(Receiv

able)

Amount

of

Transact

ion upto

31.03.216

Amoun

t out

Standi

ng as

on

31.03.2

016

Payabl

e/

(Receiv

able)

Amount of

Transactio

n in 2014 –

2015

Amount

out

Standing

as on

31.03.20

15

Payable/

(Receiva

ble)

Amount of

Transactio

n in 2013 –

2014

Amoun

t out

Standi

ng as

on

31.03.2

014

Payabl

e/

(Receiv

able)

Amount of

Transaction

in 2012 –

2013

Amount out

Standing as

on 31.03.2013

Payable/

(Receivable)

Ultrachir

aonHelat

hcarePvt Ltd

Related

Party

Purchase 201.92 320.55 55.04 - - -

Sales - - - -

Payable 34.82 40.79 76.48

Alpha

Products

Related

Party

Purchase 600.30 963.77 198.93 - - -

Sales

Payable 281.95 260.25 280.49

Quixotic

Healthca

re

Related

Party

Purchase 2078.41 2278.16 609.22 - - -

Debtors 269.64

Payable 666.91 1002.4

8

844.70

Preet Packagin

g

Solution

Related Party

Purchase 4.14

Sales

Payable 2.72 4.32 1.00

Shiva

Traders

Related

Party

Purchase 2.24

Sales

Payable 2.65 2.65

200

Annexure-XXVII

Details of Accounting Ratios:

(₹ in Lakhs, except per share data)


2018 2017 2016 2015 2014

Restated PAT as per P&L

Account 182.31 95.78 27.03 33.42 44.18

Weighted Average Number of

Equity Shares at the end of the

Year/Period*

60.00 30.25 30.00 30.00 30.00

Number of Equity Shares

outstanding at the end of the

Year/Period

60.00 30.25 30.00 30.00 30.00

Net Worth

2055.28 1851.00 1771.54 1737.10 1708.61

Earnings Per Share

Basic & Diluted 3.04 3.16 0.90 1.11 1.47

Return on Net Worth (%) 8.87% 5.17% 1.53% 1.92% 2.59%

Net Asset Value Per Share (₹) 34.25 61.7 59.05 57.90 56.95

Nominal Value per Equity

share (₹)

10.00 10.00 10.00 10.00 10.00

Ratios have been calculated as below:

Basic and Diluted Earnings per

Share (EPS) (₹)

: Restated Profit after Tax available to Equity Shareholders

Weighted Average Number of Equity Shares at the end of the

year/period

Return on Net Worth (%) : Restated Profit after Tax available to equity Shareholders

Restated Net Worth of Equity Shareholders

Net Asset Value per equity share

(₹)

: Restated Net Worth of Equity Shareholders

Number of Equity Shares outstanding at the end of the year / period

Annexure-XXVIII

Capitalization Statement as at March 31, 2018

(₹ in Lakhs)

Particulars Pre Issue Post Issue

BORROWINGS

Short Term Debt (A) 762.29 762.29

Long Term Debt (B) 360.91 360.91

Total Debts (C) 1123.20 1123.20

SHAREHOLDERS’ FUNDS

Equity Share Capital 600.00 840.00

Reserve and Surplus - As Restated 1455.28 2439.28

TOTAL SHAREHOLDERS’ FUNDS 2055.28 3279.28

Long Term Debt / Shareholders’ Funds 17.56% -

Total Debt / Shareholders Fund 54.65% -

The post issue capitalisation Statement assumes that debt level of the company to be same as that of March 31,

2018.

201

Annexure-XXIX

Statement of Tax Shelters:

(₹ in Lakhs)


2018 2017 2016 2015 2014

Restated Profit before tax (A) 282.80 135.36 48.74 52.56 70.34

Tax Rate (%) 30% 30% 30% 30% 30%

MAT Rate 18.5% 18.5% 18.5% 18.5% 18.5%

Adjustments:

(b) Permanent Differences

(Profit)/Loss on sale of FA - - 81.54 - -

Donation 0.26 0.64 0.87 0.72 0.70

Disallowed u/s 36 to 40 4.39 5.05 6.63 9.92 14.61

Total Permanent Differences(B) 4.65 5.69 89.04 10.64 15.31

(c) Timing Differences

Gratuity provision 23.34 19.88 9.70 6.93 5.04

Gratuity payment

Difference between tax depreciation

and book depreciation

9.71 9.37 (0.12) (40.89) (5.49)

Total Timing Differences (C) 33.05 29.25 9.58 (33.96) (0.45)

Net Adjustments D = (B+C) 37.70 34.94 98.62 (23.32) 14.86

Incomes Considered Separately

Taxable Income/(Loss) (A+D) 320.50 170.30 147.36 29.24 85.20

Restated Profit for The Purpose of

MAT

306.14 155.24 58.43 57.49 75.38

Taxable Income / (Loss) as per

MAT

282.80 135.36 48.74 52.56 70.34

Income Tax as returned/computed 207.66 109.52 124.99 79.86 70.34

Tax paid as per normal or MAT NORMAL NORMAL NORMAL NORMAL MAT

202

FINANCIAL INDEBTEDNESS

Set forth below, is a brief summary of our Company’s borrowings as on 31 March 2018 together with a brief

description of certain significant terms / material covenants of the relevant financing arrangements.

Nature of Borrowing Amount Outstanding as at March 31, 2018 (Rs. in

Lakhs)

Secured Borrowings 893.97

Unsecured Borrowings* -

Total 893.97

*The entire unsecured borrowings are from Promoters/ Promoter Group and their relatives.

Details of Secured Loans

(₹. in Lakhs)

Name of

Lenders

Type of

Loan

Date of

Sanction

Amount

Sanctioned

Amount

Outstanding

as at July 31,

2018

Interest/Commission

(in % p.a.)

Security Tenor/R

epayme

nt

Schedul

e

HDFC

Bank

Cash Credit

(Hyp)

16 July

2016 700.00 530.34 10.00%

See Note

1

Term loan

(Loan

Agreement

No-

82037866)

300 226.74 10.05%

Term Loan

(Loan

Agreement

No –

82437619)

200.00 136.89 9.40%

Total 1200.00 893.97

Note 1 for facilities taken from

a) Primary Security

Sr. No. Nature of

Limit

Nature of Security

1. CC Limit Hypothication of stocks of raw material, stock in process, stock in transit, finished goods at

unit/godown or other places including goods in transit and receivables.

2. Term loan Charge on the present and future fixed assets of the company.

b) Collateral Security

1. Mortgage of the factory building situated at plot no.183, industrial area of 504 Sq. Mts (SFS)

HPSIDC, Baddi, District Solan, Himachal Pradesh owned by M/s Preet Remedies Limited.



203





c) Guarantees

Personal guarantee of Directors and Property owners -Mr.Satish Kumar, Harpreet Singh, Sanjeev Kumar,

Sanjay Dhir, Mrs.Him Jyoti and M/s Preet Remedies Limited- property owner

RESTRICTIVE / NEGATIVE COVENANTS

The above sanction letters include various restrictive covenants in relation to certain actions to be undertaken by our

Company and for which prior written approval of the Bank(s) is required. The major restrictive covenants (which

require prior approval) are mentioned below: (some of these may be common across all banks, while some may be

specific to a particular bank).

This is an indictive list and there may be additional terms that may amount to an event of default under the various

borrowing arrangements entered into by us.

1. Any increase in project cost on account of any item not listed in the project details submitted for evaluation and

/or cost overrun will be funded by infusion of long term funds by the promoter.

2. No dividend to be declared/ no withdrawal in form of salary/remuneration/incentive/commission by

promoters/directors in case of overdues with bank.

3. None of the directors of the borrower is a director of specified near relation of a director of a banking company.

4. Unsercured loans will be converted into Equity as and when required to maintain a positive tangible net worth.

5. The funds will not be utilized for any speculative, illegal and investing in capital market prupose but will be

utilized only for working capital requirements.

6. The insurance on stock and property to be assigned in favor of HDFC bank within 30 days after the date of

disbursement in the event of noncompliance of the same HDFC bank reserves the right to debit the credit facility &

current account for the insurance premium and get the policy assigned in the favor of the bank.

204

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF

OPERATIONS

You should read the following discussion of our financial condition and results of operations together with our

restated financial statements included in the Draft Prospectus. You should also read the section entitled “Risk

Factors” beginning on page no 15, which discusses a number of factors, risks and contingencies that could affect our

financial condition and results of operations. The following discussion relates to our Company and, is based on our

restated financial statements, which have been prepared in accordance with Indian GAAP, the Companies Act and

the SEBI Regulations. Portions of the following discussion are also based on internally prepared statistical

information and on other sources. Our fiscal year ends on March 31 of each year, so all references to a particular

fiscal year (“Fiscal Year”) are to the twelve-month period ended March 31 of that year.

Business Overview


Registrar of Companies, Jalandhar under the provisions of the Companies Act, 1956. Subsequently, our Company

was converted into a Public Limited Company and the name of our Company was changed to ‘Preet Remedies

Limited’. A fresh certificate of incorporation consequent upon conversion to public limited Company was issued by

the Registrar of Companies, Chandigarh on February 06, 2018.

Our Company is working as a contract manufacturing company in India. With the help of our production unit, we

are capable to deliver the variety of product range to our customers. We have the capacity to deliver all type of

product range such as a Tablets Capsules, Ointment, Cream, Gel, Lotion, Shampoo and dry syrup. Being a third-

party Pharma Manufacturing, we make use of best quality raw material and cutting-edge tools.

Significant developments subsequent to the last financial year

After the date of last financial year i.e. March 31, 2018, the Directors of our Company confirm that, there have not

been any significant material developments.

Discussion on Results of Operation:

The following discussion on results of operations should be read in conjunction with the Audited Financial Results

of our Company for the years ended March 31, 2018, March 31, 2017, March 31,2016, March 31, 2015 and March

31, 2014

Key factors affecting the results of operation:

Our Company‘s future results of operations could be affected potentially by the following factors:

Political Stability of the Country.

World Economy.

Government policies for the capital markets.

Investment Flow in the country from the other countries.

Competition from existing players

Company‘s ability to successfully implement our growth strategy

Loss due to delay in execution of projects in time

Government policy.

Disruption in supply of Raw Materials at our projects sites;

Failure to obtain any approvals, licenses, registrations and permits in a timely manner;

Concentration of ownership amongst our Promoter.

Our ability to expand our geographical area of operation;

Recession in the market;

Our ability to attract, retain and manage qualified personnel;

Failure to adapt to the changing technology in our industry of operation;

The performance of the financial markets in India and globally

205

OUR SIGNIFICANT ACCOUNTING POLICIES

For Significant accounting policies please refer Significant Accounting Policies beginning under Chapter titled

“Auditors Report And Financial Information Of Our Company” beginning on page no. 176 of draft Prospectus.

DISCUSSION OF RESULT OF OPERATION

The following discussion on result of operations should be read in conjunction with the restated financial statements

of our Company for the years ended March 31, 2018, March 31, 2017, March 31,2016, March 31, 2015 and March

31, 2014

OVERVIEW OF REVENUE & EXPENDITURE

Revenues:

Income from operations:

Our principal component of revenue from operations is from income from manufacture and sale of pharmaceutical

products.

Other Income:

Our other income mainly includes interest from FD’s and Dividend Income.

Expenditure:

Our total expenditure primarily consists of cost of materials consumed, employee benefit expenses, Operating,

Administrative, Selling and Other Expenses, finance cost, depreciation and other expenses.

Employee benefits expense:

Our employee benefits expense primarily comprise of salaries and wages expenses and staff welfare expenses.


Depreciation includes depreciation on tangible assets like building, furniture & fixtures, computers and office

equipment. Amortization includes amortization of intangible assets.

Other Expenses

Other expenses include the following:

General expenses like maintenance charges, marketing and sales promotion expenses, printing, stationery, insurance,

audit and professional fees etc.

Administrative and other expenses such as insurance, travelling, legal expenses, etc.

Statement of profits and loss

The following table sets forth, for the fiscal years indicated, certain items derived from our Company‘s audited

consolidated restated financial statements, in each case stated in absolute terms and as a percentage of total sales

and/or total revenue:

206


2018 % 2017 % 2016 % 2015 % 2014 %

Revenue:


Taxes)

6698.92 98.90% 8083.00 99.69% 7505.83 100.04% 7596.65 101.32% 5735.63 98.89%

Other Income 75.23 1.11% 24.84 0.31% -3.36 -99.14 -1.32% 64.28 1.11%

Total Revenue 6773.47 100 8107.84 100 7502.48 100 7497.51 100 5799.9 100

Expenses: 0.00%

Cost of Material Consumed 5014.29 74.03% 6532.9 80.58% 5840.75 77.85% 6297.14 83.99% 4797.41 82.72%

Manufacturing & Operating Costs 382.76 5.65% 400.32 4.94% 358.88 4.78% 206.98 2.76% 148.11 2.55%

Purchase of Stock-in –Trade - - - #VALUE! - -


goods, work-in-progress and Stock-

in-Trade

-22.73 -0.34% -24.98 -0.31% 70.67 0.94% -76.84 -1.02% 72.9 1.26%

Employee benefit expenses 520.92 7.69% 533.58 6.58% 584.17 7.79% 626.63 8.36% 363.29 6.26%

Financial Cost 79.26 1.17% 81.54 1.01% 78.85 1.05% 91.45 1.22% 85.27 1.47%


expenses

90.39 1.33% 102.18 1.26% 103.49 1.38% 152.77 2.04% 74.34 1.28%

Others Expenses 284.32 4.20% 251.22 3.10% 316.34 4.22% 157.01 2.09% 140.39 2.42%

Total Expenses 6349.2 93.74% 7876.75 97.15% 7353.15 98.01% 7455.15 99.44% 5681.71 97.96%



424.27 6.26% 231.09 2.85% 149.33 1.99% 42.37 0.57% 118.19 2.04%


Profit before extraordinary items

and tax (A-B)

424.27 6.26% 231.09 2.85% 149.33 1.99% 42.37 0.57% 118.19 2.04%



Profit before tax 424.27 6.26% 231.09 2.85% 149.33 1.99% 42.37 0.57% 118.19 2.04%

Tax expense : 0.00% 0.00% 0.00% 0.00%

Current tax 94.95 1.40% 55.25 0.68% 47.5 0.63% 47.66 0.64% 13.47 0.23%

207

Deferred Tax 3 0.04% -15.15 -0.19% -7.19 -0.10% -10.18 -0.14% -1.7 -0.03%

Earlier years - - - - 9.36 0.16%


Tax-PAT

326.32 4.82% 190.99 2.36% 109.02 1.45% 4.89 0.07% 97.06 1.67%

208

COMPARISON OF FINANCIAL YEAR ENDED MARCH 31, 2018 WITH FINANCIAL YEAR ENDED

MARCH 31, 2017:

Income from Operations

Particulars 2017 – 18 2016 - 2017 Variance In %

Revenue from Operations 6698.00 8083.00 17.13%

The operating income of the Company for the year ending March 31, 2018 is Rs. 6,698 Lakhs as compared to

Rs. 8,083 Lakhs for the year ending March 31, 2017, showing decrease of 17.13% is due to change in marketing

policies of the Company as the Company has concentrated on high Gross Profit products and benefit of Taxation

Policies.

Other Income

Our other income increases to Rs. 59.23 Lakhs from Rs. 24.84 Lakhs. This was primarily due to inclusion of

income / (loss) from associate group of companies.

Cost of Materials Consumed


Cost of Materials Consumed 5014.29 6532.90 23.24%

There was a decrease in cost of materials consumed from Rs. 6532.90 Lakhs to Rs. 5014.29 Lakhs, which was

primarily in line with reduction in turnover for the current year.

Manufacturing and Operating Expenses:

Particulars 2017 – 18 2016 2017 Variance In %

Manufacturing and Operating

Expenses

382.76 400.32 4.38%

There is 4.38% decrease in Manufacturing and Operating Expenses from Rs. 400.32 Lakhs in financial year

2016-17 to Rs. 382.76 Lakhs in financial year 2017-18 which was primarily in line with reduction in production

and turnover for the current year.

Depreciation

Depreciation expenses for the Financial Year 2017-2018 have decrease to Rs.90.39 Lakhs from Rs. 102.18

Lakhs for the Financial Year 2016-2017. The decrease in depreciation was majorly due to continuation of

adoption of depreciation policies as per Companies Act, 2013.

Finance Charges

Our finance cost which consists of interest, processing fees and charges decreased by 2.79 % in FY 2017-18 as

compared to FY 2016-17 due to timely repayment of principal and interest component of secured loans.

Profit Before Tax

Rs. In Lakhs

Particulars 2017 – 18 2016-2017 Variance In %

Profit Before Tax 424.27 231.09 83.59%

Profit before tax increased by 83.59% from 231.09 Lakhs in financial year 2016-17 to Rs. 424.27 Lakhs in

financial year 2017-18 due to concentration on high Gross Profit products and benefit of Taxation Policies

Provision for taxes and Profit After Tax

209

Rs. In Lakhs

Particulars 2017 – 18 2016 – 2017 Variance In %

Taxation Expenses 97.95 40.10 57.85%

Profit After-tax 326.32 190.99 70.85%

Our Taxation Expenses increased by 57.85% from Rs. 40.10 Lakhs in financial year 2016-17 to Rs. 97.95 Lakhs

in financial year 2017-18. This increase was in line with increase in income from operations and Profit before

Taxes.


MARCH 31, 2016


Particulars 2016 - 2017 2015 - 2016 Variance In %


The operating income of the Company for the year ending March 31, 2017 is increased to Rs. 8083.00 Lakhs as

compared to Rs. 7505.83 Lakhs for the year ending March 31, 2016, showing increase of 7.68 % is due to

promotional and advertising policies of the Company and increase in demand of products for the relevant

period.

Other Income

Our other income increase to Rs. 24.84 Lakhs from Rs. -3.36 Lakhs. This was primarily due to inclusion of

income / (loss) from associate group of companies.


Particulars 2016 – 2017 2015 - 2016 Variance In

%


There was an increase in cost of materials consumed from Rs. 5840.75 Lakhs to Rs. 6532.90 Lakhs, which was

primarily due to an increase in line in the turnover for the relevant period.

Manufacturing and Operating Expenses



Expenses

400.32 358.88 11.54%

There is 11.54% increase in Manufacturing and Operating Expenses from Rs. 358.88 Lakhs in financial year

2015-16 to Rs. 400.32 Lakhs in financial year 2016-17 which was primarily an increase in line with production

and turnover for the current year.

Depreciation

Depreciation expenses for the Financial Year 2016 - 2017 have decrease to Rs. 102.18 Lakhs from Rs. 103.49

Lakhs for the Financial Year 2015-2016. The Decrease in depreciation was majorly due to continuation of

adoption of depreciation policies as per Companies Act, 2013.

Finance Charges

Our finance cost which consists of interest, processing fees and charges increase by 3.41% in FY 2016-17 as

compared to FY 2015-16 due to increase in interest on further Secured Loan taken from Bank.

Profit Before Tax

Rs. In Lakhs



210

Profit before tax increased by 54.75% from Rs. 149.33 Lakhs in financial year 2015-16 to Rs.231.09 Lakhs in

financial year 2016-17 due to increase in turnover of the Company.


Rs. In Lakhs



Profit After-tax 190.99 109.02 75.18%

Our Taxation Expenses decrease by 0.52 % from Rs. 40.31 Lakhs in financial year 2015-16 to Rs. 40.10 Lakhs


Taxes


MARCH 31, 2014:


Particulars 2015 – 16 2014 – 15 Variance In %


The operating income of the Company for the year ending March 31, 2016 is Rs. 7505.83 Lakhs as compared to

Rs. 7596.65 Lakhs for the year ending March 31, 2015, showing decreased of 1.19 % due to minor reduction in

production.

Other Income

Our other income increased / losses reduced to Rs. -3.36 Lakhs from Rs. -99.14 Lakhs. This was primarily due

to inclusion of income / (loss) from associate group of companies.




There was a decrease in cost of materials consumed from Rs. 6297.14 Lakhs to Rs. 5840.75 Lakhs, which was

primarily due to an decrease in line with the turnover for the relevant period and also fluctuation in price of

certain materials used in production.

Manufacturing and Operating Expenses



Expenses

358.88 206.98 73.38%

There is 73.38% increase in Manufacturing and Operating Expenses from Rs. 206.98 Lakhs in financial year

2014-15 to Rs. 358.88 Lakhs in financial year 2015-16 which is due to increase in material, labour and repair

costs.

Depreciation

Depreciation expenses for the Financial Year 2015 – 2016 have decrease to Rs.103.49 Lakhs from Rs. 152.77

Lakhs for the Financial Year 2014-2015. The Decrease in depreciation was majorly due to continuation of

adoption of depreciation policies as per Companies Act, 2013

211

Finance Charges

Our finance cost which consists of interest, processing fees and charges decrease by 13.77% in FY 2015-16 as

compared to FY 2014-15 due to timely repayment of principal and interest component of secured loans.

Profit Before Tax

Rs. In Lakhs



Profit before tax increased by 252.44% From Rs. 42.37 Lakhs in financial year 2014-15 to Rs.149.33 Lakhs

in financial year 2015-16 due to increase in the turnover and profit of associate group of companies.


.Rs. In Lakhs



Profit After-tax 109.02 4.89 2129.44%

Our Taxation Expenses increased by 7.55% from Rs. 37.48 Lakhs in financial year 2014-15 to Rs. 40.31 Lakhs


Taxes.

FACTORS THAT MAY AFFECT THE RESULTS OF THE OPERATIONS:

1. Unusual or infrequent events or transactions.

There have been no unusual or infrequent events or transactions that have taken place during the last three years

to the best of our knowledge.

2. Significant economic changes that materially affected or are likely to affect income from continuing

operations.

Our business has been subject, and we expect it to continue to be subject, to significant economic changes

arising from the trends identified above in “Factors Affecting our Results of Operations” and the uncertainties

described in the section entitled “Risk Factors” beginning on page no. 15 of this Draft Prospectus. There are no

known factors which we expect to bring about significant economic changes to the best of our knowledge.

3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales,

revenue or income from continuing operations.

Apart from the risks as disclosed under Section titled “Risk Factors” beginning on page no. 15 in this Draft

Prospectus, in our opinion there are no other known trends or uncertainties that have had or are expected to have

a material adverse impact on revenue or income from continuing operations.

4. Future changes in relationship between costs and revenues, in case of events such as future increase in labour

or material costs or prices that will cause a material change are known.

To the best of our knowledge, there are no future relationship between cost and income that would be expected

to have a material adverse impact on our operations and revenues. However, increase in the cost of the services

in which the Company deals, will affect the profitability of the Company. Further, the Company may not be able

to pass on the increase in prices of the services to the customers in full and this can be offset through cost

reduction.

5. Extent to which material increases in net sales or revenue are due to increased sales volume, introduction of

new products or increased sales prices.

212

Increases in revenues are by and large linked to increases in volume of business.

6. Total turnover of each major industry segment in which the issuer company operated.

The Company is operating single business segment i.e manufacturing of pharmaceutical items. Relevant

industry data, as available, has been included in the chapter titled "Industry Overview" beginning on page 83 of


7. Status of any publicly announced new products or business segment.

Our Company has not announced any new projects or business segments, other than disclosed in this draft

Prospectus.

8. The extent to which business is seasonal.

Our Company‘s Business is not seasonal in nature.

9. Any significant dependence on a single or few suppliers or customers.

We are not under threat of dependence from any single supplier or customer.

10. Competitive conditions:

The pharmaceutical industries / market is not highly competitive and fragmented, and we do not face

competition from domestic manufacturer even Some of our competitors have greater financial, marketing, sales

and other resources than we do. However, if we seek to diversify into new geographical areas, we may face

competition from competitors that have a pan-India presence and also from competitors that have a strong

presence in regional markets. Competition in certain markets may have a material adverse effect on our

operations in that market. We believe that we compete favorably with our principal competitors in each of these

areas. We also believe that our impeccable track record provides us with a competitive advantage that enables us

to compete effectively.

213

SECTION VII-LEGAL AND OTHER INFORMATION OUTSTANDING LITIGATION AND

MATERIAL DEVELOPMENTS

OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS

Except as stated below, there are no outstanding litigations, suits, criminal or civil prosecutions, proceedings or

tax liabilities against our Company, our Directors, our Promoters, our Group Companies and Subsidiaries that

would have a material adverse effect on our business. Further, except as stated below there are no defaults,

non-payment of statutory dues, over-dues to banks/financial institutions, defaults against banks/financial

institutions, defaults in dues payable to holders of any debenture, bonds and fixed deposits and arrears of

preference shares issued by our Company, default in creation of full security as per terms of issue/other

liabilities. No proceedings have been initiated for economic/civil/any other offences (including past cases where

penalties may or may not have been awarded and irrespective of whether they are specified under paragraph

(a) of Part I of Schedule V of the Companies Act, 2013) other than unclaimed liabilities of our Company and no

disciplinary action has been taken by SEBI or any stock exchanges against our Company, our Promoters, our

Directors, our Group Companies and Subsidiaries.

Except as disclosed below there are no i) litigation or legal actions, pending or taken, by any Ministry or

department of the Government or a statutory authority against our Promoters during the last five years; (ii)

direction issued by such Ministry or Department or statutory authority upon conclusion of such litigation or

legal action; (iii) pending proceedings initiated against our Company for economic offences; (iv) default and

non-payment of statutory dues by our Company; (v) inquiries, inspections or investigations initiated or

conducted under the Companies Act, 2013 or any previous companies law in the last five years against our

Company and Subsidiaries including fines imposed or compounding of offences done in those five years; or (vi)

material frauds committed against our Company in the last five years.

Our Board of Directors, in its meeting held on May 25, 2018 determined that outstanding legal proceedings

involving our Company, Directors, Promoters, Group Companies and Subsidiaries shall be considered material

if: (a) the aggregate amount involved in such individual litigation exceeds 1% of the turnover of the Company

or Rs. 100 lakhs, as per the last audited financial statements, whichever is lower;(b) where the decision in one

litigation is likely to affect the decision in similar litigations, even though the amount involved in such single

litigation individually may not exceed 1% of the turnover of the Company or Rs.100 lakhs as per the last audited

financial statements, whichever is lower if similar litigations put together collectively exceeds 1% of the

turnover of the Company or Rs.100 lakhs, whichever is lower; (c) litigations whose outcome could have a

material impact on the business, operations, prospects or reputations of the Company or any such litigation

wherein the monetary liability is not quantifiable which is or is expected to be material from the perspective of

Company’s business, operations, prospects or reputation and the Board or any of its committees shall have the

power and authority to determine the suitable materiality thresholds for the subsequent financial years on the

aforesaid basis or any other basis as may be determined by the Board or any of its committees.Accordingly, we

have disclosed all outstanding litigations involving our Company, Promoters, Directors, Group Companies and

Subsidiaries which are considered to be material.In case of pending civil litigation proceedings wherein the

monetary amount involved is not quantifiable, such litigation has been considered ‘material’ only in the event

that the outcome of such litigation has an adverse effect on the operations or performance of our Company.

Further, dues owed by our Company to small scale undertakings and other creditors, which exceeds Rs. 1 lakh

as at March 31, 2018 ("Material Creditors") have been considered as material dues for the purposes of

disclosure in this Draft Prospectus as determined by our Board of Directors in its meeting held on May 25,

2018.

Unless stated to the contrary, the information provided below is as on the date of this Draft Prospectus.

CONTINGENT LIABILITIES

NIL

A. LITIGATION INVOLVING OUR COMPANY

(I) Litigation against our Company:

(a) Litigation Involving Criminal Laws:

214

1. The Drugs Inspector, Food & Drug Administration M.S Satara, has filed a complaint under the Drugs &

Cosmetics Act, 1940 on account of a failure of Metpride tablet sample from meeting requisite standards

under the said act. The complaint has been filed in the Court of Chief Judicial Magistrate, Satara

(Maharashtra). A summons have been issued against the Company and one of our Directors, Mr. Harpreet

Singh is required to personally appear in the matter. The matter is pending. The next date of hearing in the

matter is September 25, 2018.

2. The Drug Inspector, Jamnagar (GJ) has filed a complaint under the Drugs & Cosmetics Act, 1940 in the

Court of the Chief Judicial Magistrate, Jamnagar (Gujarat) against our Company and certain other entities.

The complaint has been filed on the ground that the drug sample of Calthrox Cream that was sent for

retesting had passed the expiry date and was not retested and was returned. The matter is pending and it is

at the stage of evidence by the prosecution.The next date of hearing in the matter is November1, 2018.

3. The Drugs Inspector, Food & Drug Administration, Udaipur, Rajasthan, has filed a complaint under the

Drugs & Cosmetics Act, 1940 on account of a failure of Swilex tablet sample to conform to the claim with

respect to disintegration. The complaint has been filed in the Court of Chief Judicial Magistrate, Udaipur

(Rajasthan). A summons have been issued against the Company and one of our Directors, to personally

appear in the matter. The next date of hearing in the matter is December 3, 2018.

4. The Government of Rajasthan has filed a complaint under the Drugs & Cosmetics Act, 1940 on account of

a failure of Swilextablet sample to conform to the claim with respect to disintegration. The complaint has

been filed in the Court of Chief Judicial Magistrate, Pali (Rajasthan). A summons have been issued against

the Company and one of our Directors, to personally appear in the matter. The matter is pending and there

has been no further intimation in the matter.

5. The Drugs Inspector, Food & Drug Administration Andhra Pradesh, has filed a complaint under the Drugs

& Cosmetics Act, 1940 on account of a failure of Biozen tablet sample from meeting requisite standards

under the said act. The complaint has been filed in the Court of Judicial First-Class Magistrate Srikakulam

(Andhra Pradesh). A summons have been issued against the Company and one of our Directors is required

to personally appear in the matter. A petition to quash the complaint has been filed in the Andhra Pradesh

High Court and the matter is pending. The next date of hearing is October 19, 2018.

6. The Drugs Inspector, Chirala Andhra Pradesh, has filed a complaint against our Company under the Drugs

& Cosmetics Act, 1940 on account of a failure of Rabi tablet sample from meeting requisite standards

under the said act. The complaint has been filed in the Court of Additional Junior Civil Judge, Chirala

(Andhra Pradesh). A summons has been issued against the Company and one of our Directors is required

to personally appear in the matter. The next date of hearing is October 5, 2018. A petition to quash the

complaint has been filed in the Andhra Pradesh High Court and the matter is pending. An interim stay has

been passed by the Andhra Pradesh High Court on all further proceedings in the matter pending at the

Additional Junior Civil Judge, Chirala.

7. The Drug Inspector, Kerala has filed a complaint under the Drugs & Cosmetics Act, 1940 in the Court of

the Judicial First Class Magistrate I, Chengannur (Kerala) against our Company and certain other

entities.The complaint has been filed on the ground that the drug sample that was sent for retesting had

passed the expiry date and was not retested and was returned. The matter is pending.The next date of

hearing in the matter is December 13, 2018.

8. The Drugs Inspector, Dindigul - II, Tamil Nadu has filed a complaint under the Drugs & Cosmetics Act,

1940 on account of a failure of Rabi tablet sample from meeting requisite standards under the said act. The

complaint has been filed in the Court of Judicial Magistrate No: II Dindigul. A summons have been issued

against the Company and one of our Directors, Mr. Harpreet Singh is required to personally appear in the

matter. The matter is pending. The next date of hearing in the matter is October 31, 2018. A petition to

quash the complaint has been filed in the Madras High Court and the matter has been disposed off.

9. The Drugs Inspector, Tamil Nadu has filed a complaint against our Company under the Drugs &

Cosmetics Act, 1940 on account of a failure of Rabifin tablet sample from meeting requisite standards

under the said act. The complaint has been filed in the XV Metropolitan Magistrate Court, Georgetown,

Madras. A summons have been issued against the Company and one of our Directors is required to

personally appear in the matter. The next date of hearing is September 28, 2018. A petition to quash the

215

complaint has been filed in the Madras High Court and the matter is pending.

10. The Drugs Inspector,Tamil Nadu has filed a complaint against our Company under the Drugs & Cosmetics

Act, 1940 on account of a failure of Rabifin tablet sample from meeting requisite standards under the said

act. The complaint has been filed in the Court of Chief Judicial Magistrate, Tiruvallur, Tamil Nadu. A

summons have been issued against the Company and one of our Directors is required to personally appear

in the matter. The next date of hearing is October 12, 2018. A petition to quash the complaint has been

filed in the Madras High Court and the matter is pending.

11. The Drugs Inspector,Tamil Nadu has filed a complaint against our Company under the Drugs & Cosmetics

Act, 1940 on account of a failure of Vocetin tablet sample from meeting requisite standards under the said

act. The complaint has been filed in the Court of District Munsif – Cum- Judicial Magistrate, Uthangarai,

Tamil Nadu. A summons have been issued against the Company and one of our Directors is required to





under the said act. The complaint has been filed in the Court of District Judicial Magistrate No. I Salem,

Tamil Nadu. A summons have been issued against the Company and one of our Directors is required to



13. The Drugs Inspector, Drugs Inspector, Erode range II,Tamil Nadu has filed a complaint against our

Company under the Drugs & Cosmetics Act, 1940 on account of a failure of a sample from meeting

requisite standards under the said act. The complaint has been filed in the Court of Judicial Metropolitan

Magistrate Court No. 1, Gobichettypalayam, Tamil Nadu. A summons have been issued against the

Company and one of our Directors is required to personally appear in the matter. The next date of hearing

is September 12, 2018. A petition to quash the complaint has been filed in the Madras High Court and the

matter is pending.



under the said act. The complaint has been filed in the Court of Judicial Magistrate No. II, Madurai, Tamil

Nadu. A summons have been issued against the Company and one of our Directors is required to

personally appear in the matter. The matter is pending for hearing. A petition to quash the complaint has

been filed in the Madras High Court and the matter is disposed.

15. The Assistant Director of Drugs Control, Tamil Nadu has filed a complaint against our Company under the

Drugs & Cosmetics Act, 1940 on account of a failure of a sample from meeting requisite standards under

the said act. The complaint has been filed in the Court of Judicial Magistrate No. I, Udumalpet, Tamil

Nadu. A summons have been issued against the Company and one of our Directors is required to

personally appear in the matter. The matter is pending for hearing. A petition to quash the complaint has

been filed in the Madras High Court and the matter is pending.

16. The State of AP Drugs Inspector, Narasaraopet, Andhra Pradesh has filed a complaint against our

Company under the Drugs & Cosmetics Act, 1940 on account of a failure of Nekszone 40 tablet sample

from meeting requisite standards under the saidact. The complaint has been filed in the Court of Junior

Civil Judge, Vinukonda, Andhra Pradesh. A summons have been issued against the Company and our

Directors are required to personally appear in the matter. The next date of hearing is September 24, 2018.

17. The Drugs Inspector P.N. Chauhan, Maharashtra has filed a complaint against our Company under the

Drugs & Cosmetics Act, 1940 on account of a failure of a sample from meeting requisite standards under

the said act. The complaint has been filed in the Court of Chief Metropolitan Magistrate, 15th Court,

Sewree, Mumbai. A summons have been issued against the Company and one of our Directors is required

to personally appear in the matter. The matter is pending for hearing.

(b) Litigation Involving Actions by Statutory/Regulatory Authorities: NIL

(c) Litigation Involving Tax Liabilities:

216


Assessment

Year

Section Date of

demand

Outstanding Demand

(Rs.)

Status

2016-17 143 (a) May 27,

2017

2,99,430 The Company is yet to

pay the said amount.

(ii) Indirect Tax Liabilities: NIL

(II) Litigation by our Company:

(a) Litigation Involving Criminal Laws: NIL


(c) Litigation Involving Tax Liabilities: NIL

(d) Other Material Pending Litigations:NIL

B. LITIGATION INVOLVING OUR DIRECTORS

(I) Litigation against our Directors:

(a) *Litigation Involving Criminal Laws:


1. A complaint has been filed by the Drugs Inspector, State of Tamil Nadu, in the Court of Metropolitan

Magistrate, Saidapet Madras (Tamil Nadu) against Quixotic Healthcare on account of failure of drug

sample of SilenttExporantfor meeting quality standards. The matter is pending and next date of hearing is

September 14, 2018. A petition to quash the complaint has been filed in the Madras High Court and the

matter is pending. An interim stay has been passed by the Madras High Court on all further proceedings in

the matter pending at the Metropolitan Magistrate, Saidapet, Chennai.

2. A complaint has been filed by the Drugs Inspector, State of Tamil Nadu, in the Metropolitan Magistrate

Court Georgetown (Tamil Nadu) against Quixotic Healthcare on account of failure of drug sample of

Oflovis Ofloxacin oral suspension. The matter is pending and next date of hearing is September 14, 2018.

A petition to quash the complaint has been filed in the Madras High Court and the matter is pending. An

interim stay has been passed by the Madras High Court on all further proceedings in the matter pending at

the Metropolitan Magistrate Court, Georgetown, Chennai.

3. A complaint has been filed by the Drugs Inspector, State of Maharashtra, in the Court of Metropolitan

Magistrate, Mazgaon, Mumbai, Maharashtra against Quixotic Healthcare and M/s. Zenlabs India on

account of distribution and sale of not standard quality drug Bexzyme syrup, digestive enzyme with

vitamin B-Complex manufactured by Quixotic Healthcare and consequent contraventions under the Drugs

and Cosmetics Act, 1940. The matter is pending and next date of hearing is September 10, 2018.

4. A complaint has been filed by the Drugs Inspector, State of Andhra Pradesh, in the Court of Judicial

Magistrate First Class, Husnabad, Andhra Pradesh against Quixotic Healthcare on account of failure of

sample tablet of Bexzyme for meeting quality standards. A stay application has been filed in the High

Court of Andhra Pradesh. The matter is pending stay from High Court and of the matter is pending for

hearing.

5. A complaint has been filed by the Drugs Inspector, Jammu & Kashmir, in the Court of Chief Judicial

Magistrate of Rajouri, JK against Quixotic Healthcare on account of failure of sample of Methramed

injection from meeting quality standards. The matter is pending for hearing.

6. A complaint has been filed by the Dugs Inspector, Konkan Division, Thane against the partners of

Quixotic Healthcare regarding contravention of certain provisions of the Drugs & Cosmetics Act, 1940

217

and the rules thereunder. The complaint has been filed against Quixotic Healthcare for manufacturing and

selling not of standard quality drug Colcid Suspension. The matter is pending and there has been no further

intimation.

7. The Drugs Inspector, N P Aher, Maharashtra has filed a complaint against Quixotic Healthcare under the

Drugs & Cosmetics Act, 1940 on account of a failure of Woflox OZ Suspension sample from meeting

requisite standards under the saidact. The complaint has been filed in the Court of Chief Metropolitan

Magistrate, 15th Court, Mazgaon, Sewree, Mumbai. A summons have been issued against Quixotic

Healthcare and one of the Partnersis required to personally appear in the matter. The next date ofhearing is

October 26, 2018.

8. In case of State of Maharashtra vs. Quixotic Healthcare, the Drugs Inspector, Vilas Dusane, Beed,

Maharashtra has filed a complaint against Quixotic Healthcare under the Drugs & Cosmetics Act, 1940 on

account of a failure of Digestive Enzyme, Inzymes syrup sample from meeting requisite standards under

the said act. The complaint has been filed in the Court of First class Judicial Magistrate, Ambajogai, Beed.

The matter is pending for hearing.

Harpreet Singh

Please refer to the heading B Litigation involving our Directors – (I) Litigation against Directors – (a) –

Litigation Involving Criminal Laws – Sanjeev Kumar.

Satish Kumar

Please refer to the heading B Litigation involving our Directors – (I) Litigation against Directors – (a) –

Litigation Involving Criminal Laws – Sanjeev Kumar.

* The above cases have been included under the heading Litigation against the Directors as Mr. Sanjeev Kumar

Singal, Mr. Harpreet Singh and Mr. Satish Kumar as they are partners of the Partnership M/s. Quixotic

Healthcare and are liable as parterns of M/s. Quixotic Healthcare. Further, we do not have documents for

certain cases against Quixotic Healthcare. Please refer to the section titled "Risk Factors" beginning on page

15 of this Draft Prospectus.




Assessment Year Section Date of

demand

Outstanding Demand

(Rs.)

Status

2012-13 220(2) September

24, 2016

1,85,550 M/s. Quixotic

Healthcare is yet to pay

the said amount. 2013-14 220(2) September

1, 2016

22,920 M/s. Quixotic

Healthcare is yet to pay

the said amount.

Assessment Year 2013-2014

Quixotic Healthcare ("Assessee") has filed an appeal dated June 16, 2018 with the Commissioner of Income Tax

(Appeals), Chandigarh – 1 ("CITA") against an order passed by the Assistant Commissioner of Income Tax,

Circle – 1 (1), Chandigarh dated May 30, 2018. For the Assessment Year 2013-2014, the Assessee had filed the

return of income declaring a total income of Rs. 2,29,010 which was assessed by the Assessing Officer to be Rs.

43,95,780 by making an addition of Rs. 41,66,770 on account of a deduction of Rs. 55,55,691 claimed by the

Assessee under section 80IC at the rate of 100% of the eligible profits as against 25% amounting Rs. 13,88,922.

The Assessing Officer has alleged concealment and providing of inaccurate particulars while filing return by the

Assessee. Accordingly, a demand of Rs. 12,87,532 was imposed on the Assessee. The Assesseethen filed an

appeal against the order of the Assessing Officer with the CITA. The CITAvide order dated April 28,2017

confirmed the additions made by the Assessing Officer and dismissed the appeal of the Assessee. Thereafter, the

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Assessee filed another appeal with the Income Tax Appellate Tribunal ("ITAT") against the order passed by

CITA. The ITATvide order dated September 15, 2017 upheld the order passed by the Assessing Officer and

confirmed by CITA leading to the present appeal being filed by the Assessee. The Assessee has denied the

allegations made by the Assessing Officer and CITA and the appeal is pending with the CITA.

(d) Other Material Pending Litigations:

1. Centaur Pharmaceuticals Pvt. Ltd vs. Intas Pharmaceuticals Ltd. and Quixotic Healthcare

Centaur Pharmaceuticals Pvt. Ltd. (”Plaintiff”) has filed a suit against Intas Pharmaceuticals Ltd. and Quixotic

Healthcare (“Defendants”) in the High Court of Judicature at Bombay. Plaintiff hasfiled the said suit alleging

the Defendant’s trademarki.e. KUFFREST and KUFFREST-LSis deceptively similar to that of the Plaintiff’s

trademark KOFAREST consequently infringing the said trademark of the Plaintiff’s. Quixotic Healthcare has

been made a party on account the manufacturing the products of Intas Pharmaceuticals Ltd. who is the

Defendant no. 1. The Plaintiff has filed an application seeking ad-interim relief in the matter. Quixotic

Healthcare has filed its written statement and the matter is pending.

(II) Litigation by our Directors:


1. Quixotic Healthcare ("Complainant") has filed a complaint under Sections 406, 420, 120 –B of the Indian

Penal Code, 1860 against Shamsher Singh, Chief Manager, Bank of India D.S. Pai Assistant General

Manager, Bank of India and Branch Manager, Bank of Baroda, Hamidia Road, Bhopal regarding the

unauthorized debit of Rs. 7,29,541in favor of Rajiv Singh from the account of the Complainant maintained

with Bank of India which the Complainant had noticed despite no cheque being issued by the Complainant

in favour of Rajiv Singh presented to Bank of Baroda. The complainant has filed the complaint against

Bank of India on account of printing of cheque book of the same series, the clearing of bogus and

duplicate cheque without precautions by the bank, the failure to check the apparent tenor of instrument and

physical feel of instrument by the bank in connivance with each other is a nexus of cheating and criminal

misappropriation leading to a theft of highly sensitive data about the Complainant.The Complainant has

prayed that the accused be summoned and tried for the offences under Sections 406, 420, 120 –B of the

Indian Penal Code, 1860.The complaint has been filed with the Chief Judicial Magistrate, Chandigarh and

is pending for next hearing on September 20, 2018.




1. Quixotic Healthcare ("Complainant") has filed a complaint under Section 11 and 12 of the Consumer

Protection Act, 1986 in the District Consumer Disputes Redressal Forum, Chandigarh against Chief

Manager, Bank of India, Assistant General Manager, Bank of India and Branch Manager of Bank of

Baroda regarding the unauthorized debit of Rs. 7,29,541 in favor of Rajiv Singh from the account of

the Complainant maintained with Bank of India which the Complainant had noticed despite no cheque

being issued by the Complainant in favour of Rajiv Singh presented to Bank of Baroda. The

Complainant has filed the complaint against Bank of India on account of printing of cheque book of the

same series, the clearing of bogus and duplicate cheque without precautions by the bank, the failure to

check the apparent tenor of instrument and physical feel of instrument by the bank in connivance with

each other is a nexus of cheating and criminal misappropriation leading to a theft of highly sensitive

data about the Complainant. The Complainant has prayed for the reimbursement of the amount of Rs.

7,29,541 along with the interest at the rate of 18% per annum and a compensation of Rs. 8,00,000

along with an interest rate of 18% for the mental agony and litigation expenses. The next date of

hearing is September 18, 2018.

C. LITIGATION INVOLVING OUR PROMOTERS:

(I) Litigation against our Promoters:

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Litigation Involving Criminal Laws: Please refer to the heading B Litigation involving our Directors –

(I) Litigation against Directors – (a) – Litigation Involving Criminal Laws – Sanjeev Kumar Singal,

Harpreet Singh and Satish Kumar.

(a) Litigation Involving Actions by Statutory/Regulatory Authorities: NIL

Litigation Involving Tax Liabilities: Please refer to the heading B Litigation involving our Directors –

(I) Litigation against Directors – (c) – Litigation Involving Tax Liabilitiess – (i) Direct Tax Liabilities

– M/s. Quixotic Healthcare.

(b) Other Material Pending Litigations: NIL

(II) Litigation by our Promoters:




Other Material Pending Litigations: Please refer to the heading B Litigation involving our Directors –

(I) Litigation by our Directors – (d) – Other Material Pending Litigation.

D. LITIGATION INVOLVING OUR GROUP COMPANIES*:

(I) Litigation against our Group Companies:


1. Drugs Inspector vs. M/s Zenlabs India - The Drugs Inspector, Vepery Range, Tamil Nadu has filed a

complaint against M/s Zenlabs India under the Drugs & Magic Remedies (Objectionable

Advertisement), 1954 on account of a failure of Z pill sample from meeting requisite standards under

thesaidact. The complaint has been filed in the Court of X Metropolitan Magistrate Court, Egmore,

Madras. A summons have been issued against M/s Zenlabs India and one of our Directors is required to

personally appear in the matter. Matter is pending for hearing.




Assessment

Year

Section Date of

demand

Outstanding Demand

(Rs.)

Status

Alpha Products

2015-16 143(3) April 17,

2017

6,28,050 The Company has

submitted that there is

error in the calculation

of tax and has requested

for a rectification of the

said demand. There has

been no further action in

the matter.


1. Iatros Pharmaceuticals Private Limited vs Zenlabs India and Alpha Products

Iatros Pharmaceuticals Private Limited ("Plaintiff") has filed a suit for declaration, injunction and

rendition of accounts against Zenlabs India, our associate and Alpha Products, our subsidiary in the

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Court of District Judge, Pune ("Defendants"). The civil suit has been filed by the Plaintiff with respect

to their registered trademark “ZENOVIT” which is allegedly being used by the Defendants by

manufacturing and marketing multivitamin, minerals and antioxidantssoftgels in the form of capsules

bearing the trademark “ZENOVIT”. The Plaintiffs have submitted that the trademark ZENOVIT

adopted and being used by the Defendants was identical with and deceptively similar to the Plaintiff’s

registered trademark ZENOVIT. It is further submitted that the goods in respect of which the

Defendants were using the trademark ZENOVIT are deceptively similar to the goods in respect of

which the Plaintiff’s trademark’ ZENOVIT is registered and intended its actual commercial use

consequently infringing the said trademark. The Plaintiffs have prayed that the Defendants, jointly and

severally be restrained from infringing the trademark ZENOVIT or in any manner using the mark

ZENOVIT or any deceptively similar mark or any colorable imitation of the trademark ZENOVIT in

respect of medicinal and /or pharmaceutical preparations or similar goods. The Plaintiffs have also

prayed that the Defendants, jointly and severally be restrained from passing-off medicinal and/or

pharmaceutical preparations or similar goods by adopting and/or in any manner using the mark

ZENOVIT or any mark deceptively similar to the Plaintiffs' registered trademark ZENOVIT respect of

the medicinal and/or pharmaceutical preparations or similargoods. The Plaintiffs have valued the suit at

Rs. 1,06,000. The Defendants have submitted thatthe Plaintiffs have not used the mark prior to 2013

rendering their 1989 registration immaterial and that Defendents have been using the mark since 2008

hence making them the prior user. The ad-interim injunction has been denied. The matter is pending for

framing of issues and evidence and the next date of hearing is September 11, 2018.

2. Rajiv Kumar vs. Alpha Products – Mr. Rajiv Kumar, a laborer of Alpha Products has filed a complaint

with the Court of Civil Judge Senior Division Nadaon, Himachal Pradesh under the Payment of Wages

Act, 1936 for severe bodily injury caused to him during production. The ex-parte proceedings were

held and an ex- parte order was passed regarding our non appearance on the date fixed. Alpha Products

has filed an application for setting aside the ex-parte order. The matter is pending and the next date of

hearing is October 5, 2018.

3. Glenmark Pharmaceuticals Limited vs. Zenlabs India and Preet Remedies Limited - Glenmark

Pharmaceuticals Limited ("Plaintiffs") has filed a civil suit against Zenlabs India and Preet Remedies

Limited ("Defendants") for the alleging that the trademark ‘Zenox’ of the Defendants is identical

and/or deceptively similar to the trademark of ‘Zinox’ of the Plaintiffs. The Plaintiffs have prayed that

the Defendants be restrained by a temporarily order and injunction for manufacturing, selling and

distributing any goods in the name of Zenox or using any other mark deceptively similar to the

Plaintiff’s mark Zinox so as to infringe the Defendants’ trademark Zinox or pass-off the Defendants’

goods as those of the Plaintiff’s. The Plaintiffs have prayed for an ad-interim relief and the matter is

pending.

*We do not have documents for certain cases against one of our group companies, Oasis Pharma &

Phytomolecules Private Limited. Please refer to the section titled "Risk Factors" beginning on page 15


(II) Litigation by our Group Companies*:





1. Zenlab Ethica Limited vs. Iatros Pharmaceuticals Limited –Zenlabs Ethica Limited ("Plaintiff") has

filed a suit for permanent injunction, passing off, rendition of accounts etc. against Iatros

Pharmaceuticals Limited("Defendants") in the Court of District Judge, Pune. The suit has been filed as

counter suit to the suit filed by Iatros Pharmaceuticals Limited against erstwhile Zen Labs India and

Alpha Products alleging manufacturing and marketing by the Plaintiff of multivitamin, minerals and

antioxidantssoftgels in the form of capsules bearing the trademark “ZENOVIT” which is owned by the

Defendants. The Plaintiffs have filed the present suit against the Defendants herein alleging that the

mark “ZENOVIT” is associated with the Plaintiff as and any use of the said mark by any person/entity

or business amounts to passing off. It has been submitted by the Plaintiff that the Plaintiff has used the

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said mark since the year 2008-09 and is continuously using the same and hence is the prior user of the

same while the Defendants have commenced using the same only in the year 2013 despite having a

registration in the 1989. The Plaintiffs have prayed for an order of permanent injunction against the

Defendants from using or otherwise dealing with any goods bearing deceptively similar mark as

“ZENOVIT”, rendition of accounts and decree due to profits earned by the Defendants by wrongful use

of the said mark and passing off. The suit has been valued by Plaintiff at Rs. 10,00,400. The matter is

pending.

*We do not have documents for certain cases by one of our group companies, Oasis Pharma &

Phytomolecules Private Limited. Please refer to the section titled "Risk Factors" beginning on page 15


E. OUTSTANDING DUES TO CREDITORS OF OUR COMPANY

As onMarch 31, 2018, our Company does not owe a sum exceeding Rs. 1 lakh to any undertaking

except the following:

Particulars Number of creditors Amount (Rs. in lakhs)

Micro, Small and Medium Enterprises* 0 0

Material Creditors 156 2,018.70

Other Creditors 46 30.59

Total 202 2,047.29

The details pertaining to net outstanding dues towards our Material Creditors shall be made available

under investors’ section on the website of our Company i.e.www.preetremedies.com.It is clarified that

such details available on our website do not form a part of this Draft Prospectus. Anyone placing

reliance on any other source of information, including our Company’s website,

www.preetremedies.comwould be doing so at their own risk.

F. MATERIAL DEVELOPMENTS SINCE THE LAST BALANCE SHEET DATE

Except as mentioned under the chapter "Management Discussion and Analysis of Financial Condition

and Result of Operation" beginning on page 204 of this Draft Prospectus, there have been no material

developments, since the date of the last audited balance sheet.

http://www.bhojohorimanna.com/

http://www.preetremedies.com/

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GOVERNMENT AND OTHER APPROVALS

Our Company has received the necessary consents, licenses, permissions and approvals from the Central and

State Government and other governmental agencies/regulatory authorities/certification bodies required to

undertake the Issue or continue our business activities. It must be distinctly understood that in granting these

approvals, the Government of India does not take any responsibility for the financial soundness of the Company

or for the correctness of any of the statements made or opinions expressed in this behalf.

In view of the approvals listed below, we can undertake the Issue for our current/ proposed business activities

and no further material approvals from any statutory authority are required to be undertaken, in respect of the

Issue or to continue our business activities.

The main objects clause of the Memorandum of Association and objects incidental to the main objects enable

our Company to carry out its activities.

Approvals for the Issue

1. The Board of Directors have, pursuant to Section 62(1)(c) of the Companies Act, 2013, by a resolution

passed at its meeting held on May 25, 2018 authorized the Issue, subject to the approval of the shareholders

and such other authorities as may be necessary.

2. The Shareholders of our Company have, pursuant to Section 62(1)(c) of the Companies Act 2013, by a

special resolution passed in the extra ordinary general meeting held on June 8, 2018 authorized the Issue.

3. In-principle approval from the NSE Limited dated [].

Approvals in relation to the incorporation of our Company

1. Certificate of Incorporation issued under Companies Act, 1956 by the Registrar of Companies, Punjab,

Himachal Pradesh and Chandigarh in the name of "Preet Remedies Private Limited" datedFebruary 10,

2005.

2. A fresh certificate of incorporation pursuant to change of name from "Preet Remedies Private Limited" to

"Preet Remedies Limited" was issued under the Companies Act, 2013 by the Registrar of Companies,

ChandigarhdatedFebruary 06, 2018.

Tax approvals in relation to our Company

1. The Permanent Account Number (PAN) of our Company is AADCP4799B.

2. The Tax deduction Account Number (TAN) of our Company isPTLP12673D with respect to our Registered

Office and PTLP13808E for our manufacturing unit at Baddi.

3. The Goods and Services Tax Number of our Company is 02AADCP4799B2ZJ dated June 28, 2017.

Approvals in relation to our business

1. Our Company has been granted the Udhyog Aadhar Registration certificate bearing Udyog Aadhar number

CH01B0004347 under The Micro, Small and Medium Enterprise Developments Act, 2006 issued by the

Ministry of Micro, Small & Medium Enterprises. The date of commencement was February 10, 2005.

2. Our Company has been registered as an industrial unit vide Permanent Registration No. 02/09/04616/PMT

dated November 21, 2005 in the Department of Industries, Single Window Clearance Agency Baddi, for the

manufacturing/ assembling of tablets, ointments, capsules, lotion/ gel powder and shampoo for sale.

3. Our Company has been allocated Entrepreneur’s Memorandum Part-II bearing No. 02/009/12/70703 dated

April 22, 2011 under the micro/small/medium scale enterprise for the manufacturing/ assembling/ servicing

of pharmaceutical formulation with effective from March 30, 2010 by the office of the Deputy Director of

Industries, Single Window Clearance Agency, Department of Industries, Baddi.

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4. Our Company has been granted the Goods Manufacturing Practices Certificate (G.M.P Certificate) dated

October 17, 2017 in respect of category of drugs, tablets, capsules, ointments and lotion under the

provisions of Drugs & Cosmetics Rules, 1945 issued by the State Drugs Controller, Baddi District, Solan,

Himachal Pradesh (Health & Family Welfare Department). The certificate is valid for the period of two

years upto October 16, 2019.

5. Certificate of Renewal of License Numbers MNB/09/794 & MB/09/795 dated July 28, 2015 to manufacture

for sale of drugs (a) other than those specified in schedule C, C(1) and X and (b) specified in schedule C,

C(1) other than those specified in schedule X; of the Drugs and Cosmetics Rules, 1945 by the State Drugs

Controller, Baddi District, Solan, Himachal Pradesh. The License is valid till March 25, 2020.

6. Our Company has obtained the Importer-Exporter certificate bearing IEC number 2205002350 issued by

the Directorate of Foreign Trade, Ministry of Commerce dated September 08, 2005.

7. Our Company has been granted Drugs Manufacturing License Nos. MNB/05/113 and License No.

MB/05/114 on April 6, 2005 by the Drugs Controller cum Licensing Authority, Shimla, Himachal Pradesh

(Health & Family Welfare Department for the sale of drugs: (a)biological drugs specified in Schedule C &

C (I) of the Drugs Rules, 1945 and (b) other than those specified products in Schedule C& C (I)of the Drugs

Rules, 1945.

8. Our Company has been granted License Number 10914011000131 dated February 4, 2014, in the State

category, by the State Licensing Authority under Food Safety and Standards Act, 2006 (Department of

Health Safety and Regulations, Himachal Pradesh). The License is valid from February 4, 2014 to February

3, 2019.

9. Our Company has been granted the License to run a factory videRegistration Number L&E(FAC)9-

2017111-2187 dated April 11, 2017 by the Chief Inspector of Factories, Himachal Pradesh (Himachal

Pradesh Government, Labour Department) subject to the provisions of the Factories Act, 1948. The License

is valid till December 31, 2019.

Labour Approvals

1. Our Company has been allotted the Code No. PN/SM/HP-4278 dated August 24, 2005 by the Regional

Office (Shimla) of Employees Provident Fund Organisation for the purpose of making compliance with the

various provisions of the E.P.F & Misc. Provisions Act, 1952 and the schemes framed thereunder. This was

effective from June 01, 2005.

2. Our Company has been allotted the Code No. HP/14/43136/34 dated August 09, 2005 by the Regional

Office (ESI Hospital Complex, Parwanoo, Himachal Pradesh) of Employees’ State Insurance Corporation

for the purpose of registration of the employees under the Employees’ State Insurance Act, 1948

Pending Approvals

1. Our Company has made an application for the registration for the following trademark under the Trade

Marks Act, 1999:

Sr. No Brand name/ logo trademark Registration Number Class Application Date

1. DEVICE [LABEL] PREET REMEDIES LIMITED

5648

35 September 8, 2018

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OTHER REGULATORY AND STATUTORY DISCLOSURES

Authority for the Issue

The Board of Directors, pursuant to a resolution passed at their meeting held on May 25, 2018 authorized the

Issue, subject to the approval of the shareholders of our Company under Section 62(1)(c) of the Companies Act,

2013, and such other authorities as may be necessary.

The shareholders of our Company have, pursuant to a special resolution passed under Section 62(1)(c) of the

Companies Act, 2013 at an Extra Ordinary General Meeting held on June 08, 2018 authorized the Issue.

Our Company has obtained in-principle approval from the Emerge Platform of National Stock Exchange of

India Limited for using its name in the Draft Prospectus/ Prospectus pursuant to an approval letter dated [●].

NSE is the Designated Stock Exchange.

Prohibition by SEBI or other governmental authorities

We confirm that our Company, our Promoters, relatives of Promoters, our Promoter Group, our Directors or the

persons in control of our Company and our Group Companies have not been prohibited from accessing the

capital markets for any reason, or restrained from buying, selling or dealing in securities, under any order or

directions by the SEBI or any other regulatory or government authorities.

Further, there has been no violation of any securities law committed by any of them in the past and no such

proceedings are currently pending against any of them.

We confirm that our Company, Promoters, relatives of Promoters, Promoter Group, Directors, persons in control

of our Company, or Group Companies have not been debarred or prohibited from accessing or operating in the

capital markets under any order or direction passed by SEBI or any other government authority. Neither our

Promoter, nor any of our Directors or persons in control of our Company were or are a promoter, director or

person in control of any other company which is debarred from accessing the capital market under any order or

directions made by the SEBI or any other governmental authorities.

None of our Directors are associated with the securities market in any manner, including securities market

related business and there has been no action taken by SEBI against the Directors or any other entities with

which our Directors are associated as promoters or directors.

The listing of any securities of our Company has never been refused at any time by any of the stock exchanges

in India or abroad.

Association with Securities Market

None of our Directors are in any manner associated with the securities market and there has been no action

taken by SEBI against our Directors or any entity in which our Directors are involved as Promoters or Directors.

Prohibition by RBI

Neither our Company, our Promoter, our Directors, Group Companies, relatives (as per Companies Act, 2013)

of Promoter or the person(s) in control of our Company have been identified as a willful defaulter by the RBI or

other governmental authority and no such proceedings are pending against any of them except as details

provided in the chapter titled “Outstanding Litigations and Material Development” on page 213 of this Draft

Prospectus.

Eligibility for the Issue

Our Company is in compliance with the following conditions specified in Regulation 4(2) of the SEBI (ICDR)

Regulations to the extent applicable:

Our Company, our Directors and the companies with which our Directors are associated as directors or

promoters or persons in control have not been prohibited from accessing or operating in the capital markets

under any order or direction passed by SEBI;

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a) Our Company has applied to the EMERGE Platform of the National Stock Exchange of India Limited for

obtaining their in-principle listing approval for listing of the Equity Shares under this Issue and has received

the in-principle approval from the EMERGE Platform of National Stock Exchange of India Limited

pursuant to its letter dated [●]. For the purposes of this Issue, the National Stock Exchange of India Limited

shall be the Designated Stock Exchange;

b) Our Company has entered into tripartite agreement dated May, 03 2018 with NSDL and the Registrar and

Transfer Agent, who in this case is Bigshare Services Private Limited for dematerialisation of the Equity

Shares;

c) Our Company has entered into tripartite agreement dated April 25, 2018 with CDSL and the Registrar and

Transfer Agent, who in this case is Bigshare Services Private Limited, for dematerialisation of the Equity

Shares; and

d) The Equity Shares are fully paid and there are no partly paid-up Equity Shares as on the date of filing this

Draft Prospectus.

Further, in compliance with Regulation 4(5) of the SEBI (ICDR) Regulations, none of our Company, Promoters

or Directors is a Willful Defaulter, as on the date of this Draft Prospectus.

Our Company is an "Unlisted Issuer" in terms of the SEBI (ICDR) Regulations; and this Issue is an "Initial

Public Offer" in terms of the SEBI (ICDR) Regulations.

Our Company is eligible for the Issue in accordance with Regulation 106(M) (1) and other provisions of Chapter

XB of the SEBI (ICDR) Regulations, as we are an Issuer whose post issue paid up capital does not exceed ten

crore rupees. Therefore, we may issue Equity Shares to the public and propose to list the same on the Small and

Medium Enterprise Exchange (in this case being the "Emerge Platform of National Stock Exchange of India

Limited").

We confirm that:

1. In accordance with Regulation 106(P) of the SEBI (ICDR) Regulations, this issue is 100% underwritten

and that the Lead Manager to the Issue shall underwrite minimum 15% of the total Issue size. For further

details pertaining to said underwriting please refer to chapter titled “General Information-Underwriting”

beginning on page 3 of this Draft Prospectus.

2. In accordance with Regulation 106(R) of the SEBI (ICDR) Regulations, we shall ensure that the total

number of proposed allottees in the Issue shall be greater than or equal to 50 (fifty), otherwise, the entire

application money will be refunded forthwith. If such money is not repaid within 8 (eight) Working Days

from the date our Company becomes liable to repay it, then our Company and every officer in default

shall, on and from expiry of 8 (eight) Working Days, be liable to repay such application money, with an

interest at the rate as prescribed under the SEBI (ICDR) Regulations, Companies Act, 2013 and other

applicable laws.

3. In accordance with Regulation 106(O) the SEBI (ICDR) Regulations, we have not filed any Issue

Document with SEBI nor has SEBI issued any observations on our Issue Document. Also, we shall ensure

that our Lead Manager submits a copy of the Draft Prospectus along with a Due Diligence Certificate

including additional confirmations as required to SEBI at the time of filing the Prospectus with Stock

Exchange and the Registrar of Companies.

4. In accordance with Regulation 106(V) of the SEBI (ICDR) Regulations, we hereby confirm that we have

entered into an agreement with the Lead Manager and a Maret Maker to ensure compulsory Market

Making for a minimum period of 3 (three) years from the date of listing of Equity Shares on the Emerge

Platform of National Stock Exchange of India Limited. For further details of the arrangement of market

making, see chapter titled “General Information – Details of the Market Making Arrangements for this

Issue” beginning on page 3 of this Draft Prospectus.

5. As on the date of this Draft Prospectus, our Company has a paid-up capital of ₹ 600.00 lakhs and the post

issue capital will be of ₹ 840.00 lakhs.

226

6. Our Company has not been referred to the Board for Industrial and Financial Reconstruction (BIFR).

7. There is no winding up petition against the company, which has been admitted by the court or a liquidator

has not been appointed.

8. There has been no change in the Promoter(s) of the Company in the preceding one year from date of filing

application to the Stock Exchange or listing on the EMERGE Platform of National Stock Exchange of

India Limited.

9. Our company shall mandatorily facilitate trading in demat securities and enter into an agreement with

CDSL and NSDL.

10. No material regulatory or disciplinary action by a stock exchange or regulatory authority in the past three

years against our company.

11. We have a website: www.preetremedies.com

12. There is no material regulatory or disciplinary action by a stock exchange or regulatory authority in the

past one year in respect of promoters/promoting company(ies), group companies, companies promoted by

the promoters/promoting company(ies) except as mentioned in chapter titled "Outstanding Litigation and

Material Developments" beginning on page 213 of this Draft Prospectus.

13. There are no defaults in respect of payment of interest and/or principal to the debenture/bond/fixed deposit

holders, banks, FIs by us, our promoters/promoting company(ies), group companies, companies promoted

by the promoters/promoting company(ies) during the past three years except as mentioned in chapter titled

"Outstanding Litigation and Material Developments" beginning on page 213 of this Draft Prospectus.

14. We, our promoters/promoting company(ies), group companies, companies promoted by the

promoters/promoting company(ies) litigation record, the nature of litigation, and status of litigation please

refer to the chapter titled "Outstanding Litigation and Material Developments" beginning on page 213 of


15. For the track record of the directors, the status of criminal cases filed or nature of the investigation being

undertaken with regard to alleged commission of any offence by any of its directors and its effect on the

business of the company, where all or any of our directors have or has been charge-sheeted with serious

crimes like murder, rape, forgery, economic offences etc. please refer to the chapter titled "Outstanding

Litigation and Material Developments" beginning on page 213 of this Draft Prospectus.

We further confirm that we shall be complying with all the other requirements as laid down for such an issue

under Chapter XB of SEBI (ICDR) Regulations, as amended from time to time and subsequent circulars and

guidelines issued by SEBI and the Stock Exchange.

As per Regulation 106(M)(3) of SEBI (ICDR) Regulations, the provisions of Regulations 6(1), 6(2), 6(3),

Regulation 8, Regulation 9, Regulation 10, Regulation 25, Regulation 26, Regulation 27 and sub regulation (1)

of Regulation 49 of SEBI (ICDR) Regulations, 2009 shall not apply to us in this Issue.

The Net Worth** (excluding revaluation reserves) of the Company is at least ₹ 1 Crore as per the latest audited

financial results.

**Net worth includes Equity Share Capital and Reserves (excluding revaluation reserves, Miscellaneous Expenditure

not written off, if any & Debit Balance of Profit and Loss Account not written off, if any).

Track record of distributable profits in terms of Section 123 of Companies Act, 2013 for at least two years out of

immediately preceding three financial years and each financial year has to be a period of at least 12 months.

Extraordinary income will not be considered for the purpose of calculating distributable profits. Otherwise, the Net

Worth shall be at least ₹ 3 Crores.

Our Company shall mandatorily facilitate trading in demat securities and will enter into an agreement with both

the depositories. The Company has entered into an agreement for registration with the Central Depositary

http://www.preetremedies.com/

227

Services Limited (CDSL) dated April 25, 2018 and National Securities Depository Limited dated May 03, 2018

for establishing connectivity.

Compliance with Part A of Schedule VIII of the SEBI (ICDR) Regulations

Our Company is in compliance with the provisions specified in Part A of the SEBI (ICDR) Regulations. No

exemption from eligibility norms has been sought under Regulation 109 of the SEBI (ICDR) Regulations, with

respect to the Issue.

DISCLAIMER CLAUSE OF SEBI

IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF OFFER DOCUMENT TO THE

SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI) SHOULD NOT IN ANY WAY BE

DEEMED OR CONSTRUED THAT THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI.

SEBI DOES NOT TAKE ANY RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF

ANY SCHEME OR THE PROJECT FOR WHICH THE ISSUE IS PROPOSED TO BE MADE OR

FOR THE CORRECTNESS OF THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THE

OFFER DOCUMENT. THE LEAD MERCHANT BANKER, MARK CORPORATE ADVISORS

PRIVATE LIMITED HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE OFFER

DOCUMENT ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH THE SEBI

(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 IN FORCE

FOR THE TIME BEING. THIS REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN

INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED ISSUE.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER IS PRIMARILY

RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT

INFORMATION IN THE OFFER DOCUMENT, THE LEAD MERCHANT BANKER, MARK

CORPORATE ADVISORS PRIVATE LIMITED IS EXPECTED TO EXERCISE DUE DILIGENCE

TO ENSURE THAT THE ISSUER DISCHARGES ITS RESPONSIBILITY ADEQUATELY IN THIS

BEHALF AND TOWARDS THIS PURPOSE, THE LEAD MERCHANT BANKER HAS FURNISHED

TO SEBI A DUE DILIGENCE CERTIFICATE DATED SEPTEMBER 10, 2018 WHICH READS AS

FOLLOWS:

WE, THE UNDER NOTED LEAD MANAGER TO THE ABOVE MENTIONED FORTHCOMING

ISSUE STATE AND CONFIRM AS FOLLOWS:

1. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO

LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH

COLLABORATORS, ETC. AND OTHER MATERIAL IN CONNECTION WITH THE

FINALISATION OF THE DRAFT PROSPECTUS PERTAINING TO THE SAID ISSUE;

2. ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE ISSUER, ITS

DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, AND INDEPENDENT

VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE ISSUE,

PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS AND OTHER PAPERS

FURNISHED BY THE ISSUER, WE CONFIRM THAT:

A. THE DRAFT PROSPECTUS FILED WITH THE EXCHANGE IS IN CONFORMITY WITH

THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE;

B. ALL THE LEGAL REQUIREMENTS RELATING TO THE ISSUE AS ALSO THE

REGULATIONS GUIDELINES, INSTRUCTIONS, ETC. FRAMED/ISSUED BY THE BOARD,

THE CENTRAL GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY IN THIS

BEHALF HAVE BEEN DULY COMPLIED WITH; AND

C. THE DISCLOSURES MADE IN THE DRAFT PROSPECTUS ARE TRUE, FAIR AND

ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED DECISION

AS TO THE INVESTMENT IN THE PROPOSED ISSUE AND SUCH DISCLOSURES ARE IN

ACCORDANCE WITH THE REQUIREMENTS OF THE COMPANIES ACT, 2013,

APPLICABLE PROVISIONS OF THE COMPANIES ACT, 1956, THE SECURITIES AND

228

EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE

REQUIREMENTS) REGULATIONS, 2009 AND OTHER APPLICABLE LEGAL

REQUIREMENTS.

3. WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE

DRAFT PROSPECTUS ARE REGISTERED WITH THE BOARD AND THAT TILL DATE SUCH

REGISTRATION IS VALID.

4. WE HAVE SATISFIED OURSELVES ABOUT THE CAPABILITY OF THE UNDERWRITERS

TO FULFILL THEIR UNDERWRITING COMMITMENTS.

5. WE CERTIFY THAT WRITTEN CONSENT FROM PROMOTER HAS BEEN OBTAINED FOR

INCLUSION OF THEIR SPECIFIED SECURITIES AS PART OF PROMOTERS’

CONTRIBUTION SUBJECT TO LOCK-IN AND THE SPECIFIED SECURITIES PROPOSED TO

FORM PART OF PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN SHALL NOT BE

DISPOSED / SOLD / TRANSFERRED BY THE PROMOTER DURING THE PERIOD STARTING

FROM THE DATE OF FILING THE DRAFT PROSPECTUS WITH THE BOARD TILL THE

DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT

PROSPECTUS.

6. WE CERTIFY THAT REGULATION 33 OF THE SECURITIES AND EXCHANGE BOARD OF

INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009,

WHICH RELATES TO SPECIFIED SECURITIES INELIGIBLE FOR COMPUTATION OF

PROMOTERS CONTRIBUTION, HAS BEEN DULY COMPLIED WITH AND APPROPRIATE

DISCLOSURES AS TO COMPLIANCE WITH THE SAID REGULATION HAVE BEEN MADE

IN THE DRAFT PROSPECTUS.

7. WE UNDERTAKE THAT SUB-REGULATION (4) OF REGULATION 32 AND CLAUSE (C) AND

(D) OF SUB-REGULATION (2) OF REGULATION 8 OF THE SECURITIES AND EXCHANGE

BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)

REGULATIONS, 2009 SHALL BE COMPLIED WITH. WE CONFIRM THAT ARRANGEMENTS

HAVE BEEN MADE TO ENSURE THAT PROMOTERS’ CONTRIBUTION SHALL BE

RECEIVED AT LEAST ONE DAY BEFORE THE OPENING OF THE ISSUE. WE UNDERTAKE

THAT AUDITORS’ CERTIFICATE TO THIS EFFECT SHALL BE DULY SUBMITTED TO THE

BOARD. WE FURTHER CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO

ENSURE THAT PROMOTERS’ CONTRIBUTION SHALL BE KEPT IN AN ESCROW

ACCOUNT WITH A SCHEDULED COMMERCIAL BANK AND SHALL BE RELEASED TO

THE ISSUER ALONG WITH THE PROCEEDS OF THE PUBLIC ISSUE. – NOT APPLICABLE

8. WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE ISSUER FOR WHICH THE

FUNDS ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE ‘MAIN OBJECTS’

LISTED IN THE OBJECT CLAUSE OF THE MEMORANDUM OF ASSOCIATION OR OTHER

CHARTER OF THE ISSUER AND THAT THE ACTIVITIES WHICH HAVE BEEN CARRIED

OUT UNTIL NOW ARE VALID IN TERMS OF THE OBJECT CLAUSE OF ITS

MEMORANDUM OF ASSOCIATION.

9. WE CONFIRM THAT NECESSARY ARRANGEMENTS HAVE BEEN MADE TO ENSURE

THAT THE MONEYS RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE

BANK ACCOUNT AS PER THE PROVISIONS OF SUB-SECTION (3) OF SECTION 40 OF THE

COMPANIES ACT, 2013 AND THAT SUCH MONEYS SHALL BE RELEASED BY THE SAID

BANK ONLY AFTER PERMISSION IS OBTAINED FROM ALL THE STOCK EXCHANGES

MENTIONED IN THE DRAFT PROSPECTUS. WE FURTHER CONFIRM THAT THE

AGREEMENT ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE ISSUER

SPECIFICALLY CONTAINS THIS CONDITION – NOTED FOR COMPLIANCE.

10. WE CERTIFY ALL THE SHARES SHALL BE ISSUED IN DEMATERIALIZED FORM IN

COMPLAINCE WITH THE PROVISIONS OF SECTION 29 OF THE COMPANIES ACT, 2013

AND THE DEPOSITIOREIS ACT, 1996 AND THE REGULATIONS MADE THEREUNDER.

229

11. WE CERTIFY THAT ALL THE APPLICABLE DISCLOSURES MANDATED IN THE

SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE

REQUIREMENTS) REGULATIONS, 2009 HAVE BEEN MADE IN ADDITION TO

DISCLOSURES WHICH, IN OUR VIEW, ARE FAIR AND ADEQUATE TO ENABLE THE

INVESTOR TO MAKE A WELL INFORMED DECISION.

12. WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THE DRAFT

PROSPECTUS:

A. AN UNDERTAKING FROM THE ISSUER THAT AT ANY GIVEN TIME, THERE SHALL

BE ONLY ONE DENOMINATION FOR THE EQUITY SHARES OF THE ISSUER AND

B. AN UNDERTAKING FROM THE ISSUER THAT IT SHALL COMPLY WITH SUCH

DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY THE BOARD FROM TIME TO

TIME.

13. WE UNDERTAKE TO COMPLY WITH THE REGULATIONS PERTAINING TO

ADVERTISEMENT IN TERMS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA

(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 WHILE

MAKING THE ISSUE.

14. WE ENCLOSE A NOTE EXPLAINING HOW THE PROCESS OF DUE DILIGENCE HAS BEEN

EXERCISED BY US IN VIEW OF THE NATURE OF CURRENT BUSINESS BACKGROUND OR

THE ISSUER, SITUATION AT WHICH THE PROPOSED BUSINESS STANDS, THE RISK

FACTORS, PROMOTERS EXPERIENCE, ETC.

15. WE ENCLOSE A CHECKLIST CONFIRMING REGULATION-WISE COMPLIANCE WITH

THE APPLICABLE PROVISIONS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA

(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009,

CONTAINING DETAILS SUCH AS THE REGULATION NUMBER, ITS TEXT, THE STATUS

OF COMPLIANCE, PAGE NUMBER OF THE DRAFT PROSPECTUS WHERE THE

REGULATION HAS BEEN COMPLIED WITH AND OUR COMMENTS, IF ANY.

16. WE ENCLOSE STATEMENT ON ‘PRICE INFORMATION OF PAST ISSUES HANDLED BY

MERCHANT BANKER BELOW (WHO ARE RESPONSIBLE FOR PRICING THIS ISSUE)’, AS

PER FORMAT SPECIFIED BY SEBI THROUGH CIRCULAR NO. CIR/CFD/DIL/7/2015 DATED

OCTOBER 30, 2015.

17. WE CERTIFY THAT PROFITS FROM RELATED PARTY TRANSACTIONS HAVE ARISEN

FROM LEGITIMATE BUSINESS TRANSACTIONS TO THE EXTENT OF THE RELATED

PARTY TRANSACTIONS REPORTED IN ACCORDANCE WITH ACCOUNTING STANDARD-

18 IN THE FINANCIAL INFORMATION OF THE COMPANY INCLUDED IN THE DRAFT

PROSPECTUS.

ADDITIONAL CONFIRMATIONS/ CERTIFICATION TO BE GIVEN BY MERCHANT BANKER IN

DUE DILIGENCE CERTIFICATE TO BE GIVEN ALONG WITH ISSUE DOCUMENT REGARDING

SME EXCHANGE

(1) WE CONFIRM THAT NONE OF THE INTERMEDIARIES NAMED IN THE DRAFT

PROSPECTUS HAVE BEEN DEBARRED FROM FUNCTIONING BY ANY REGULATORY

AUTHORITY.

(2) WE CONFIRM THAT ALL THE MATERIAL DISCLOSURES IN RESPECT OF THE ISSUER

HAVE BEEN MADE IN DRAFT PROSPECTUS AND CERTIFY THAT ANY MATERIAL

DEVELOPMENT IN THE ISSUER OR RELATING TO THE ISSUE UP TO THE

COMMENCEMENT OF LISTING AND TRADING OF THE SPECIFIED SECURITIES ISSUED

THROUGH THIS ISSUE SHALL BE INFORMED THROUGH PUBLIC NOTICES/

ADVERTISEMENTS IN ALL THOSE NEWSPAPERS IN WHICH PRE-ISSUE

ADVERTISEMENT AND ADVERTISEMENT FOR OPENING OR CLOSURE OF THE ISSUE

HAVE BEEN GIVEN.

230

(3) WE CONFIRM THAT THE ABRIDGED PROSPECTUS CONTAINS ALL THE DISCLOSURES

AS SPECIFIED IN THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF

CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 - NOTED FOR

COMPLIANCE.

(4) WE CONFIRM THAT AGREEMENTS HAVE BEEN ENTERED INTO WITH THE

DEPOSITORIES FOR DEMATERIALISATION OF THE SPECIFIED SECURITIES OF THE

ISSUER – NOTED FOR COMPLIANCE.

(5) WE CERTIFY THAT AS PER THE REQUIREMENTS OF FIRST PROVISO TO SUB

REGULATION (4) OF REGULATION 32 OF SECURITIES AND EXCHANGE BOARD OF INDIA

(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009; CASH

FLOW STATEMENT HAS BEEN PREPARED AND DISCLOSED IN THE DRAFT

PROSPECTUS. - NOT APPLICABLE.

(6) WE CONFIRM THAT UNDERWRITING AND MARKET MAKING ARRANGEMENTS AS PER

REQUIREMENTS OF REGULATION 106P AND 106V OF THE SECURITIES AND EXCHANGE

BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)

REGULATIONS, 2009 HAVE BEEN MADE - NOTED FOR COMPLIANCE.

Note:

The filing of this Draft Prospectus does not, however, absolve our Company from any liabilities under Section

34, Section 35, Section 36 and Section 38 (1) of the Companies Act, 2013 or from the requirement of obtaining

such statutory and / or other clearances as may be required for the purpose of the proposed Issue. SEBI further

reserves the right to take up at any point of time, with the Lead Manager any irregularities or lapses in the

Draft Prospectus.

All legal requirements pertaining to the Issue will be complied with at the time of registration of the Prospectus

with the Registrar of Companies, Jalandhar in terms of sections 26, 32 and 33 of the Companies Act, 2013.

Statement on Price Information of Past Issues handled by Mark Corporate Advisors Private Limited:

Sr

.

N

o.

Issuer Name

Issue

size

(In Cr.)

Issue

price

(₹)

Listing

Date

Openin

g Price

on

listing

date

+/- % change in

closing price,

[+/- % change

in

closing

benchmark]-

30th calendar

days from

listing

+/- % change

in

closing price,

[+/- %

change in

closing

benchmark]-

90th calendar

days from

listing

+/- % change in

closing price,

[+/- % change in

closing

benchmark]-

180th calendar

days from listing

1.) Madhya Pradesh Media

Today Limited (NSE

EMERGE)

14.17. 66.00 September

29, 2017

70.00 36.89% 100.45 % 90.90%

5.46% 7.58% 7.43%

2.) Tasty Dairy Specialities

Limited

(BSE SME)

24.44 45.00 February

21, 2018

50.75 (2.25%) (3.30%) N.A

7.75% 2.27% N.A

3.) Godha Cabcon & Insulation

Limited (NSE EMERGE)

9.90 33.00 May 11,

2018

30.25 0.15% -10.15% N.A.

0.18% 6.146% N.A.

Disclaimer from our Company, Directors and the Lead Manager

Our Company, its Directors and the Lead Manager accept no responsibility for statements made otherwise than

those contained in this Draft Prospectus or, in case of the Company, in any advertisements or any other material

issued by or at our Company’s instance and anyone placing reliance on any other source of information would

be doing so at his or her own risk.

Caution

The Lead Manager accepts no responsibility, save to the limited extent as provided in the Issue Agreement

entered between the Lead Manager (Mark Corporate Advisors Private Limited) and our Company on July 28,

231

2018 and the Underwriting Agreement dated [●] entered into between the Underwriters and our Company and

the Market Making Agreement dated [●] entered into among the Market Maker and our Company.

All information shall be made available by our Company and the Lead Manager to the public and investors at

large and no selective or additional information would be available for a section of the investors in any manner

whatsoever including at road show presentations, in research or sales reports, at collection centers or elsewhere.

The Lead Manager and their respective associates and affiliates may engage in transactions with, and perform

services for, our Company, our Promoter Group, Group Companies, or our affiliates or associates in the

ordinary course of business and have engaged, or may in future engage, in commercial banking and investment

banking transactions with our Company, our Promoter Group, Group Companies, and our affiliates or

associates, for which they have received and may in future receive compensation. Mark Corporate Advisors

Private Limited is not an ‘associate’ of the Company and is eligible to Lead Manage this Issue, under the SEBI

(Merchant Bankers) Regulations, 1992.

Note

Investors who apply in the Issue will be required to confirm and will be deemed to have represented to

our Company and the Underwriters and their respective directors, officers, agents, affiliates and

representatives that they are eligible under all applicable laws, rules, regulations, guidelines and

approvals to acquire Equity Shares of our Company and will not offer, sell, pledge or transfer the Equity

Shares of our Company to any person who is not eligible under applicable laws, rules, regulations,

guidelines and approvals to acquire Equity Shares of our Company. Our Company, the Underwriters and

their respective directors, officers, agents, affiliates and representatives accept no responsibility or

liability for advising any investor on whether such investor is eligible to acquire the Equity Shares in the

Issue.

Track Record of past issues handled by Mark Corporate Advisors Private Limited

For details regarding track record of Lead Manager to the Issue as specified in Circular reference no.

CIR/MIRSD/1/2012 dated January 10, 2012 issued by the SEBI, please refer the website of the Lead Manager at

www.markcorporateadvisors.com/

Disclaimer in Respect of Jurisdiction

This Issue is being made in India to persons resident in India (including Indian nationals resident in India who

are majors, HUFs, companies, corporate bodies and societies registered under applicable laws in India and

authorized to invest in shares, Indian mutual funds registered with SEBI, Indian financial institutions,

commercial banks, regional rural banks, cooperative banks (subject to RBI permission), or trusts under

applicable trust law and who are authorized under their constitution to hold and invest in shares, public financial

institutions as specified in Section 2 (72) of the Companies Act, 2013, VCFs, state industrial development

corporations, insurance companies registered with the Insurance Regulatory and Development Authority,

provident funds (subject to applicable law) with a minimum corpus of ₹ 2,500.00 (Twenty Five Hundred) Lakhs

and pension funds with a minimum corpus of ₹ 2,500.00 (Twenty Five Hundred) Lakhs, and permitted non-

residents including FIIs, Eligible NRIs, multilateral and bilateral development financial institutions, FVCIs and

eligible foreign investors, insurance funds set up and managed by army, navy or air force of the Union of India

and insurance funds set up and managed by the Department of Posts, India provided that they are eligible under

all applicable laws and regulations to hold Equity Shares of our Company. This Draft Prospectus does not,

however, constitute an offer to sell or an invitation to subscribe for Equity Shares offered hereby in any

jurisdiction other than India to any person to whom it is unlawful to make an offer or invitation in such

jurisdiction. Any person into whose possession this Draft Prospectus comes is required to inform himself or

herself about, and to observe, any such restrictions.

Any dispute arising out of this Issue will be subject to jurisdiction of the competent court(s) in Chandigarh,

India only.

No action has been, or will be, taken to permit a public offering in any jurisdiction where action would be

required for that purpose. Accordingly, the Equity Shares represented hereby may not be offered or sold,

directly or indirectly, and this Draft Prospectus may not be distributed in any jurisdiction, except in accordance

with the legal requirements applicable in such jurisdiction. Neither the delivery of this Draft Prospectus nor any

232

sale hereunder shall, under any circumstances, create any implication that there has been no change in the affairs

of our Company from the date hereof or that the information contained herein is correct as of any time

subsequent to this date.

Disclaimer Clause of the Emerge Platform of National Stock Exchange of India Limited

As required, a copy of this Issue Document has been submitted to National Stock Exchange of India Limited.

National Stock Exchange of India Limited has given vide its letter [●] permission to the Issuer to use the

Exchange’s name in this Issue Document as one of the stock exchanges on which this Issuer’s securities are

proposed to be listed. The Exchange has scrutinized this draft offer document for its limited internal purpose of

deciding on the matter of granting the aforesaid permission to this Issuer. It is to be distinctly understood that

the aforesaid permission given by the National Stock Exchange of India Limited should not in any way be

deemed or construed that the Issue Document has been cleared or approved by the National Stock Exchange of

India Limited; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of

the contents of this Issue Document; nor does it warrant that this Issuer’s securities will be listed or will

continue to be listed on the Exchange; nor does it take any responsibility for the financial or other soundness of

this Issuer, its promoters, its management or any scheme or project of this 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.

Disclaimer Clause under Rule 144A of the U.S. Securities Act

The Equity Shares have not been, and will not be, registered under the U.S. Securities Act 1933, as amended

(the "Securities Act") or any state securities laws in the United States and may not be offered or sold within the

United States or to, or for the account or benefit of, "U.S. persons" (as defined in Regulation S under the

Securities Act), except pursuant to an exemption from, or in a transaction not subject to, the registration

requirements of the Securities Act. Accordingly, the Equity Shares will be offered and sold outside the United

States in compliance with Regulation S of the Securities Act and the applicable laws of the jurisdiction where

those offers and sales occur. The Equity Shares have not been, and will not be, registered, listed or otherwise

qualified in any other jurisdiction outside India and may not be offered or sold, and Bids may not be made by

persons in any such jurisdiction, except in compliance with the applicable laws of such jurisdiction.

Further, each Applicant where required agrees that such Applicant will not sell or transfer any Equity Shares or

create any economic interest therein, including any off-shore derivative instruments, such as participatory notes,

issued against the Equity Shares or any similar security, other than pursuant to an exemption from, or in a

transaction not subject to, the registration requirements of the Securities Act and in compliance with applicable

laws and legislations in each jurisdiction, including India.

Filing

The Draft Prospectus is being filed with National Stock Exchange of India Limited, Exchange Plaza, Plot No.

C/1, G Block, Bandra- Kurla Complex, Bandra (East), Mumbai-400051, Maharashtra.

This Draft Prospectus shall not be filed with the SEBI nor will SEBI issue any observation on the Prospectus in

term of Regulation 106(M) (3) of the SEBI (ICDR) Regulations. However, a copy of the Prospectus shall be

filed with SEBI at the Securities and Exchange Board of India for their record purpose only.

A copy of the Prospectus, along with the documents required to be filed under Section 32 of the Companies Act,

2013 would be delivered for registration to the Registrar of Companies, Chandigarh.

Listing

The Equity Shares of our Company are proposed to be listed on EMERGE Platform of National Stock

Exchange. Our Company has obtained in principle approval from the National Stock Exchange of India Limited

by way of its letter dated [●] for listing of equity shares on the EMERGE Platform of the National Stock

Exchange of India Limited.

233

National Stock Exchange of India Limited will be the Designated Stock Exchange, with which the ‘Basis of

Allotment’ will be finalized for the Issue. If the permission to deal in and for an official quotation of the Equity

Shares on the Emerge Platform is not granted by the National Stock Exchange of India Limited, our Company

shall forthwith repay, without interest, all moneys received from the applicants in pursuance of this Draft

Prospectus. If such money is not repaid within the prescribed time then our Company becomes liable to repay it,

then our Company and every officer in default shall, shall be liable to repay such application money, with

interest, as prescribed under the applicable law.

Our Company shall ensure that all steps for the completion of the necessary formalities for listing and

commencement of trading at the Emerge Platform of National Stock Exchange of India Limited mentioned

above are taken within 6 (Sixth) Working Days of the Issue Closing Date. If Equity Shares are not Allotted

pursuant to the Issue within 6 (Sixth) Working Days from the Issue Closing Date or within such timeline as

prescribed by the SEBI, our Company shall repay with interest all monies received from applicants, failing

which interest shall be due to be paid to the applicants at the rate of 15% per annum for the delayed period,

subject to applicable law.

Impersonation

Attention of the Applicants is specifically drawn to the provisions of sub-section (1) of Section 38 of the

Companies Act, 2013 which is reproduced below:

Any person who-

(a) Makes or abets making of an application in a fictitious name to a company for acquiring, or subscribing for,

its securities; or

(b) Makes or abets making of multiple applications to a company in different names or in different combinations

of his name or surname for acquiring or subscribing for its securities; or

(c) Otherwise induces directly or indirectly a company to allot, or register any transfer of, securities to him, or

to any other person in a fictitious name,

Shall be liable to action under section 447 of the Companies, Act 2013.The liability prescribed under Section

447 of the Companies Act, 2013, includes imprisonment for a term of not less than six months extending up to

ten years (provided that where the fraud involves public interest, such term shall not be less than three years)

and fine of an amount not less than the amount involved in the fraud, extending up to three times of such

amount.

Consents

Consents in writing of (a) our Directors, our Promoters, our Company Secretary & Compliance Officer, Chief

Financial Officer, our Statutory Auditor, our Peer Review Auditor (b) Lead Manager, Registrar to the Issue,

Banker(s) to the Issue*, Legal Advisor to the Issue, Underwriter(s) to the Issue and Market Maker to the Issue to

act in their respective capacities have been obtained as required under Section 26 of the Companies Act, 2013

and shall be filed along with a copy of the Prospectus with the RoC, as required under Sections 32 of the

Companies Act, 2013 and such consents will not be withdrawn up to the time of delivery of the Prospectus for

registration with the RoC.

*The aforesaid will be appointed prior to filing of the Prospectus with RoC and their consents as above would

be obtained prior to the filing of the Prospectus with RoC.

In accordance with the Companies Act and the SEBI (ICDR) Regulations, M/s Vijay Darji Associates, Statutory

Auditor and Peer Review Auditors of the Company has agreed to provide their written consent to the inclusion

of their respective reports on Statement of Possible Tax Benefits relating to the possible tax benefits and restated

financial statements as included in this Draft Prospectus/ Prospectus in the form and context in which they

appear therein and such consent and reports will not be withdrawn up to the time of delivery of this Draft

Prospectus.

Experts Opinion

234

Except for the reports in the section titled “Financial information of the Company” and “Statement of Tax

Benefits” beginning on page 151 and page 81 of this Draft Prospectus from the Peer Review Auditors and

Statutory Auditor respectively, our Company has not obtained any expert opinions.

Expenses of the Issue

The total expenses of the Issue are estimated to be approximately ₹ 129.00 Lakhs. The estimated Issue related

expenses include Issue Management Fee, underwriting and management fees SCSB’s commission/ Selling

commission, fees, printing and distribution expenses, legal fees, statutory advertisement expenses, registrar and

depository fees and listing fees. All expenses with respect to the Issue would be paid by our Company.

The estimated Issue expenses are as under:-

Activity

Estimated

Expenses (₹ in

Lakhs)

As a % of the total

estimated Issue

expenses

As a % of

the total

Issue size

Payment to Merchant Banker including

Underwriter Commission expenses towards

printing, advertising, and payment to other

intermediaries such as Legal Advisors,

Registrars, Bankers, etc.

[•] [•] [•]

Regulatory Fees [•] [•] [•] Marketing and Other Selling Expenses [•] [•] [•]

Total Estimated Issue Expenses 129.00 [•] [•]

*Included Commission/ processing fees for SCSB, Brokerage and selling commission for Registered Brokers,

RTA‘s and CDPs

Fees, Brokerage and Selling Commission payable to the Lead Manager/Underwriters/ Market Maker

The total fees payable to the Lead Manager will be as per the (i) MoU dated July 28, 2018 with the Lead

Manager Mark Corporate Advisors Private Limited, (ii) the Underwriting Agreement dated [●] with

Underwriter and (iii) the Market Making Agreement dated [●] with Market Maker, a copy of which is available

for inspection at our Registered Office from 10.00 am to 5.00 pm on Working Days from the date of the Draft

Prospectus until the Issue Closing Date.

Fees Payable to the Registrar to the Issue

The fees payable to the Registrar to the Issue for processing of applications, data entry, printing of CAN, tape

and printing of bulk mailing register will be as per the MOU between our Company and the Registrar to the

Issue dated August 18, 2018 a copy of which is available for inspection at our Company’s Registered Office.

The Registrar to the Issue will be reimbursed for all out-of-pocket expenses including cost of stationery,

postage, stamp duty, and communication expenses. Adequate funds will be provided to the Registrar to the Issue

to enable it to send allotment advice by registered post/speed post.

Particulars regarding Public or Rights Issues during the last five (5) years

Except as disclosed in chapter titled “Capital Structure” beginning on page 63 in this Draft Prospectus, our

Company has not made any previous public or rights issue in India or Abroad the 5 (five) years preceding the

date of this Draft Prospectus.

Previous issues of Equity Shares otherwise than for cash

For a detailed description, see chapter titled “Capital Structure” beginning on page 63 of this Draft Prospectus.

Underwriting Commission, brokerage and selling commission on Previous Issues

235

Since this is the initial public offering of our Company’s Equity Shares, no sum has been paid or has been

payable as commission or brokerage for subscribing for or procuring or agreeing to procure subscription for any

of the Equity Shares since our incorporation.

Particulars in regard to our Company and other listed group-companies / subsidiaries/ associates under

the same management within the meaning of Section 370 (1B) of the Companies Act, 1956 / Section 186 of

the Companies Act, 2013 which made any capital issue during the last three years:

Neither our Company nor any other companies under the same management within the meaning of Section

370(1B) of the Companies Act, 1956 has made/Section 186 of the Companies Act, 2013, had made any public

issue or rights issue during the last three years.

Performance vis-a-vis objects – Public/right issue of our Company and /or listed Group Companies/

subsidiaries and associates of our Company

Except as stated in the chapter titled “Capital Structure” beginning on page 63 of this Draft Prospectus our

Company has not undertaken any previous public or rights issue. None of the Group Companies/ Entities or

associates of our Company are listed on any stock exchange.

Performance vis-a-vis objects - Last Issue of Group/Associate Companies

All of our Group / Associate are unlisted and have not made a public issue of shares.

Outstanding Debentures or Bond Issues or Redeemable Preference Shares

Our Company does not have any outstanding debentures or bonds or Preference Redeemable Shares as on the

date of filing this Draft Prospectus.

Outstanding Convertible Instruments

Our Company does not have any outstanding convertible instruments as on the date of filing this Draft

Prospectus.

Option to Subscribe

Equity Shares being offered through the Draft Prospectus can be applied for in dematerialized form only.

Stock Market Data of the Equity Shares

This being an Initial Public Offering of the Equity Shares of our Company, the Equity Shares are not listed on

any Stock Exchanges.

Mechanism for Redressal of Investor Grievances

The agreement between the Registrar to the Issue and our Company provides for retention of records with the

Registrar to the Issue for a period of at least 3 (three) years from the last date of dispatch of the letters of

allotment and demat credit to enable the investors to approach the Registrar to the Issue for redressal of their

grievances.

We hereby confirm that there is no investor complaints received during the three years preceding the filing of

Draft Prospectus. Since there is no investor complaints received, none are pending as on the date of filing of this

Draft Prospectus.

All grievances relating to the Issue may be addressed to the Registrar to the Issue, with a copy to the

Compliance Officer and with a copy to the relevant Designated Intermediary with whom the Application Form

was submitted.

The Applicant should give full details such as name of the sole/ first Applicant, Application Form number,

Applicant DP ID, Client ID, PAN, date of the Application Form, address of the Applicant, number of the Equity

Shares applied for and the name and address of the Designated Intermediary where the Application Form was

236

submitted by the Applicant. Further, the investor shall also enclose the Acknowledgement Slip from the

Designated Intermediaries in addition to the documents or information mentioned herein above.

Disposal of Investor Grievances by our Company

Our Company estimates that the average time required by our Company or the Registrar to the Issue for the

redressal of routine investor grievances shall be 15 (fifteen) Working Days from the date of receipt of the

complaint. In case of complaints that are not routine or where external agencies are involved, our Company will

seek to redress these complaints as expeditiously as possible.

Our Company has appointed Sanjeev Kumar as the Compliance Officer to redress complaints, if any, of the

investors participating in the Issue. Contact details for our Company Secretary and Compliance Officer are as

follows:

Preet Remedies Limited

Plot No. 194-195, Third Floor,

Industrial Area Phase II,

Chandigarh

India

160002

For further details, please refer to the chapter titled “Our Management” beginning on page 123 of this Draft

Prospectus.

Investors can contact the Compliance Officer or the Registrar in case of any pre-Issue or post-Issue

related problems such as non-receipt of letters of allocation, credit of allotted Equity Shares in the

respective beneficiary account etc.

Pursuant to the press release no. 85/2011 dated June 8, 2011, SEBI has launched a centralized web based

complaints redress system “SCORES”. This would enable investors to lodge and follow up their complaints and

track the status of redressal of such complaints from anywhere. For more details, investors are requested to visit

the website www.scores.gov.in.

Status of Investor Complaints

We confirm that we have not received any investor compliant during the three years preceding the date of this

Draft Prospectus and hence there are no pending investor complaints as on the date of this Draft Prospectus.

Disposal of investor grievances by listed companies under the same management as our Company

We do not have any listed company under the same management.

Change in Auditors during the last three (3) years

Our Company has appointed M/s Vaijay Darji & Associates Chartered Accountants in place of M/s Shiv K

Gupta & Associates, Chartered Accountants, who has resigned due to pre-occupation, during the financial year

2017-2018.

Capitalization of Reserves or Profits

Except as disclosed under section titled “Capital Structure” beginning on page 63 of this Draft Prospectus, our

Company has not capitalized its reserves or profits at any time during the last 5 (five) years.

Revaluation of Assets

Our Company has not revalued its assets in 5 (five) years preceding the date of this Draft Prospectus.

Tax Implications

http://www.scores.gov.in/

237

Investors who are allotted Equity Shares in the Issue will be subject to capital gains tax on any resale of the

Equity Shares at applicable rates, depending on the duration for which the investors have held the Equity Shares

prior to such resale and whether the Equity Shares are sold on the Stock Exchanges. For details, please refer the

chapter titled “Statement of Tax Benefits” beginning on page 81 of this Draft Prospectus.

Purchase of Property

Other than as disclosed in chapter titled “Our Business” on page 93 of the Draft Prospectus, there is no property

which has been purchased or acquired or is proposed to be purchased or acquired which is to be paid for wholly

or partly from the proceeds of the present Issue or the purchase or acquisition of which has not been completed

on the date of the Draft Prospectus, other than property, in respect of which:-

The contract for the purchase or acquisition was entered into in the ordinary course of business, or the contract

was entered into in contemplation of the Issue, or that the Issue was contemplated in consequence of the

contract; or the amount of the purchase money is not material.

Except as stated elsewhere in the Draft Prospectus, our Company has not purchased any property in which the

Promoter and/or Directors have any direct or indirect interest in any payment made there under.

Servicing Behavior

Except as stated in this Draft Prospectus, there has been no default in payment of statutory dues or of interest or

principle in respect of our borrowings or deposits.

Payment or benefit to officers of Our Company

Except statutory benefits upon termination of their employment in our Company or superannuation, no officer

of our Company is entitled to any benefit upon termination of his employment in our Company or

superannuation.

Except as disclosed in chapter titled “Our Management” beginning on page 123 and “Related Party

Transactions” beginning on page 149 of this Draft Prospectus, none of the beneficiaries of loans and advances

and sundry debtors are related to the Directors of our Company.

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SECTION VIII- ISSUE RELATED INFORMATION

TERMS OF THE ISSUE

The Equity Shares being issued pursuant to this issue shall be subject to the provision of the Companies Act,

SEBI (ICDR) Regulations, 2009, SCRA, SCRR, Memorandum and Articles, the terms of this Prospectus,

Application Form, the Revision Form, the Confirmation of Allocation Note (‘CAN‛) and other terms and

conditions as may be incorporated in the Allotment advices and other documents/ certificates that may be

executed in respect of the Issue. The Equity Shares shall also be subject to laws, guidelines, rules, notifications

and regulations relating to the issue of capital and listing of securities issued from time to time by SEBI, the

Government of India, NSE, ROC, RBI and / or other authorities, as in force on the date of the Issue and to the

extent applicable.

Please note that, in accordance with the SEBI circular no. CIR/CFD/POLICYCELL/11/2015 dated November

10, 2015 all the Applicants has to compulsorily apply through the ASBA Process.

Further vide the said circular Registrar to the Issue and Depository Participants have been also authorised to

collect the Application forms. Investors may visit the official website of the concerned stock exchange for any

information on operationalization of this facility of form collection by Registrar to the Issue and DPs as and

when the same is made available.

Ranking of Equity Shares

The Equity Shares being issued and transferred in the Issue shall be subject to the provisions of the Companies

Act, 2013 and the Memorandum &Articles of Association and shall rank pari-passu with the existing Equity

Shares of our Company including rights in respect of dividend. The Allottees upon receipt of Allotment of

Equity Shares under this issue will be entitled to dividends and other corporate benefits, if any, declared by our

Company after the date of allotment in accordance with Companies Act, 2013 and the Articles. For further

details, please refer to the section titled‚ ‘Main Provisions of the Articles of Association of the Company’

beginning on page number 288 of this Prospectus.

Authority for the Issue

This Issue has been authorized by a resolution of the Board passed at their meeting held on May 25, 2018

subject to the approval of shareholders through a special resolution to be passed pursuant to section 62 (1) (c) of

the Companies Act, 2013. The shareholders have authorized the Issue by a special resolution in accordance with

Section 62 (1) (c) of the Companies Act, 2013 passed at the EGM of the Company held on June 08, 2018.

Mode of Payment of Dividend

The declaration and payment of dividend will be as per the provisions of Companies Act, 2013 and

recommended by the Board of Directors at their discretion and approved by the shareholders and will depend on

a number of factors, including but not limited to earnings, capital requirements and overall financial condition of

our Company. We shall pay dividends in cash and as per provisions of the Companies Act, 2013. For further

details, please refer to the chapter titled “Dividend Policy” and “Main Provisions of the Articles of Association”

beginning on pages nos. 150 and 288 of this Prospectus.

Face Value and Issue Price

The Equity Shares having a face value of ₹10 each are being offered in terms of this Prospectus at the price of

₹51 per Equity Share. The Issue Price is determined by our Company in consultation with the Lead Manager

and is justified under the chapter titled ‘Basis for Issue Price’ beginning on page 78 of this Prospectus. At any

given point of time there shall be only one denomination of the Equity Shares of our Company, subject to

applicable laws.

Compliance with SEBI (ICDR) Regulations

Our Company shall comply with all requirements of the SEBI (ICDR) Regulations. Our Company shall comply

with all disclosure and accounting norms as specified by SEBI from time to time.

239

Rights of the Equity Shareholders

Subject to applicable laws, rules, regulations and guidelines and the Articles of Association, our Shareholders

shall have the following rights:

Right to receive dividend, if declared;

Right to attend general meetings and exercise voting powers, unless prohibited by law;

Right to vote on a poll either in person or by proxy or e-voting, in accordance with the provisions of the

Companies Act;

Right to receive annual reports and notices to members;

Right to receive offers for rights shares and be allotted bonus shares, if announced;

Right to receive surplus on liquidation, subject to any statutory and preferential claim being satisfied;

Right of free transferability, subject to applicable laws and regulations; and the Articles of Association of

our Company; and

Such other rights, as may be available to a shareholder of a listed public company under the Companies Act

and the Memorandum and Articles of Association of the Company.

For a detailed description of the main provisions of the Articles of Association of our Company relating to

voting rights, dividend, forfeiture and lien, transfer, transmission and/or consolidation/splitting, see ‘Main

Provisions of Articles of Association’ beginning on page 288 of this Prospectus.

Minimum Application Value, Market Lot and Trading Lot

As per the provisions of the Depositories Act, 1996 & regulations made thereunder and Section 29 (1) of the

Companies Act, 2013, the equity shares of a body corporate can be in dematerialized form i.e. not in the form of

physical certificates, but be fungible and be represented by the statement issued through electronic mode. The

trading of the Equity Shares will happen in the minimum contract size of 2,000 Equity Shares and the same may

be modified by the NSE from time to time by giving prior notice to investors at large. Allocation and allotment

of Equity Shares through this Issue will be done in multiples of 2,000 Equity Shares subject to a minimum

allotment of 2,000 Equity Shares to the successful Applicants in terms of the SEBI circular No.

CIR/MRD/DSA/06/2012 dated February 21, 2012.

Minimum Number of Allottees

Further in accordance with the Regulation 106R of SEBI (ICDR) Regulations, the minimum number of allottees

in this Issue shall be 50 shareholders. In case the minimum number of prospective allottees is less than 50, no

allotment will be made pursuant to this Issue and all the monies blocked by SCSBs shall be unblocked within

four (4) working days of closure of Issue.

Joint Holders

Where 2 (two) or more persons are registered as the holders of any Equity Shares, they will be deemed to hold

such Equity Shares as joint-holders with benefits of survivorship.

Jurisdiction

Exclusive Jurisdiction for the purpose of this Issue is with the competent courts/authorities in Chandigarh, India.

The Equity Share have not been and will not be registered under the U.S. Securities Act or any state securities

laws in the United States and may not be issued or sold within the United States or to, or for the account or

benefit of, “U.S. persons” (as defined in Regulation S), except pursuant to an exemption from, or in a

transaction not subject to, the registration requirements of the U.S. Securities Act and applicable U.S. state

securities laws. Accordingly, the Equity Shares are being issued and sold only outside the United States in off-

shore transactions in reliance on Regulation S under the U.S. Securities Act and the applicable laws of the

jurisdiction where those issues and sales occur.

The Equity Shares have not been and will not be registered, listed or otherwise qualified in any other

jurisdiction outside India and may not be issued or sold, and applications may not be made by persons in any

such jurisdiction, except in compliance with the applicable laws of such jurisdiction.

240

Nomination Facility to Bidders

In accordance with Section 72 of the Companies Act, 2013, read with Companies (Share Capital and

Debentures) Rules, 2014, the sole Applicant, or the first Applicant along with other joint Applicants, may

nominate any one person in whom, in the event of the death of sole Applicant or in case of joint Applicants,

death of all the Applicants, as the case may be, the Equity Shares Allotted, if any, shall vest. A person, being a

nominee, entitled to the Equity Shares by reason of the death of the original holder(s), shall be entitled to the

same advantages to which he or she would be entitled if he or she were the registered holder of the Equity

Share(s). Where the nominee is a minor, the holder(s) may make a nomination to appoint, in the prescribed

manner, any person to become entitled to equity share(s) in the event of his or her death during the minority. A

nomination shall stand rescinded upon a sale of Equity Share(s) by the person nominating. A buyer will be titled

to make afresh nomination in the manner prescribed. Fresh nomination can be made only on the prescribed form

available on request at our Registered Office or Corporate Office or to the registrar and transfer agents of our

Company.

Any person who becomes a nominee by virtue of Section 72 of the Companies Act, 2013, shall upon the

production of such evidence as may be required by the Board, elect either:

a) to register himself or herself as the holder of the Equity Shares; or

b) to make such transfer of the Equity Shares, as the deceased holder could have made.

Further, the Board may, at any time, give notice requiring any nominee to choose either to be registered himself

or herself or to transfer the Equity Shares, and if the notice is not complied with within a period of 90 days, the

Board may, thereafter, withhold payment of all dividends, bonuses or other monies payable in respect of the

Equity Shares, until the requirements of the notice have been complied with.

Since the Allotment of Equity Shares in the Issue will be made only in dematerialized form, there is no need to

make a separate nomination with our Company. Nominations registered with respective depository participant

of the applicant would prevail. If the Applicants require changing of their nomination, they are requested to

inform their respective depository participant.

Restrictions, if any on Transfer and Transmission of Equity Shares

Except for the lock-in of the pre-Issue capital of our Company, Promoters’ minimum contribution as provided in

“Capital Structure” on page no. 63 of this Prospectus, and except as provided in the Articles of Association

there are no restrictions on transfer of Equity Shares. Further, there are no restrictions on the transmission of

shares/debentures and on their consolidation/splitting, except as provided in the Articles of Association. For

details, please refer “Main Provisions of Articles of Association” on page 288 of this Prospectus.

The above information is given for the benefit of the Applicants. The Applicants are advised to make their own

enquiries about the limits applicable to them. Our Company and the Lead Manager do not accept any

responsibility for the completeness and accuracy of the information stated hereinabove. Our Company and the

Lead Manager are not liable to inform the investors of any amendments or modifications or changes in

applicable laws or regulations, which may occur after the date of the Prospectus. Applicants are advised to make

their independent investigations and ensure that the number of Equity Shares Applied for do not exceed the

applicable limits under laws or regulations.

Withdrawal of the Issue

Our Company in consultation with the LM, reserve the right not to proceed with the Issue after the Bid/Issue

Opening Date but before the Allotment. In such an event, our Company would issue a public notice in the

newspapers in which the pre-Issue advertisements were published, within two (2) days of the Bid/Issue Closing

Date or such other time as may be prescribed by SEBI, providing reasons for not proceeding with the Issue. The

Lead Manager through, the Registrar to the Issue, shall notify the SCSBs to unblock the bank accounts of the

ASBA Bidders within one (1) Working Day from the date of receipt of such notification. Our Company shall

also inform the same to the Stock Exchanges on which Equity Shares are proposed to be listed.

Notwithstanding the foregoing, this Issue is also subject to obtaining (i) the final listing and trading approvals of

the Stock Exchange, which our Company shall apply for after Allotment, and (ii) the final RoC approval of the

Prospectus after it is filed with the RoC. If our Company withdraws the Issue after the Bid/ Issue Closing Date

241

and thereafter determines that it will proceed with an issue/issue for sale of the Equity Shares, our Company

shall file a fresh Prospectus with Stock Exchange.

PERIOD OF OPERATION OF SUBSCRIPTION LIST OF PUBLIC ISSUE

Issue Opens On : [●]

Issue Closes On : [●]

Finalisation of Basis of Allotment with the Designated Stock Exchange : [●]

Initiation of Refunds : [●]

Credit of Equity Shares to demat accounts of Allottees : [●]

Commencement of trading of the Equity Shares on the Stock Exchange : [●]

The above timetable is indicative and does not constitute any obligation on our Company, and the LM. Whilst

our Company shall ensure that all steps for the completion of the necessary formalities for the listing and the

commencement of trading of the Equity Shares on the Stock Exchange are taken within 6 Working Days of the

Issue Closing Date, the timetable may change due to various factors, such as extension of the Issue Period by

our Company or any delays in receiving the final listing and trading approval from the Stock Exchange. The

Commencement of trading of the Equity Shares will be entirely at the discretion of the Stock Exchange and in

accordance with the applicable laws.

Applications and any revision to the same shall be accepted only between 10.00 a.m. and 5.00 p.m. (IST)

during the Issue Period. On the Issue Closing Date, the Applications and any revision to the same shall be

accepted between 10.00 a.m. and 5.00 p.m. (IST) or such extended time as permitted by the Stock Exchanges,

in case of Applications by Retail Individual Applicants after taking into account the total number of

Applications received up to the closure of timings and reported by the Lead Manager to the Stock Exchange. It

is clarified that Applications not uploaded on the electronic system would be rejected. Applications will be

accepted only on Working Days, i.e., Monday to Friday (excluding any public holiday).

Due to limitation of time available for uploading the Applications on the Issue Closing Date, the Applicants are

advised to submit their Applications one day prior to the Issue Closing Date and, in any case, not later than 5.00

p.m. (IST) on the Issue Closing Date. All times mentioned in this Draft Prospectus are Indian Standard Times.

Applicants are cautioned that in the event a large number of Applications are received on the Issue Closing

Date, as is typically experienced in public issue, some Applications may not get uploaded due to lack of

sufficient time. Such Applications that cannot be uploaded will not be considered for allocation under the Issue.

Applications will be accepted only on Business Days. Neither our Company nor the Lead Manager is liable for

any failure in uploading the Applications due to faults in any software/hardware system or otherwise. Any time

mentioned in this Draft Prospectus is Indian Standard Time.

In case of any discrepancy in the data entered in the electronic book vis-à-vis the data contained in the Bid cum

Application Form, for a particular Bidder, the Registrar to the Issue shall ask for rectified data.

Minimum Subscription

This Issue is not restricted to any minimum subscription level and is 100% underwritten. As per Section 39 of

the Companies Act, 2013, if the “stated minimum amount” has not be subscribed and the sum payable on

application is not received within a period of 30 days from the date of the Prospectus, the application money has

to be returned within such period as may be prescribed. If our Company does not receive the 100% subscription

of the issue through the Issue Document including devolvement of Underwriters, if any, within sixty (60) days

from the date of closure of the issue, our Company shall forthwith refund the entire subscription amount

received. If there is a delay beyond eight days after our Company becomes liable to pay the amount, our

Company and every officer in default will, on and from the expiry of this period, be jointly and severally liable

to repay the money, with interest or other penalty as prescribed under the SEBI Regulations, the Companies Act

2013 and applicable law.

In accordance with Regulation 106 P (1) of the SEBI (ICDR) Regulations, our Issue shall be hundred percent

underwritten. Thus, the underwriting obligations shall be for the entire hundred percent of the issue through the

Prospectus and shall not be restricted to the minimum subscription level.

Further, in accordance with Regulation 106(R) of the SEBI (ICDR) Regulations, our Company shall ensure that

the number of prospective allottees to whom the Equity Shares will allotted will not be less than 50 (Fifty).

242

Further, in accordance with Regulation 106(Q) of the SEBI (ICDR) Regulations, our Company shall ensure that

the minimum application size in terms of number of specified securities shall not be less than ₹1,00,000 (Rupees

One Lac only) per application.

The Equity Shares have not been and will not be registered, listed or otherwise qualified in any other jurisdiction

outside India and may not be issued or sold, and applications may not be made by persons in any such

jurisdiction, except in compliance with the applicable laws of such jurisdiction.

Migration to Main Board

Our company may migrate to the main board of NSE at a later date subject to the following:

a) If the Paid up Capital of our Company is likely to increase above ₹25 crores by virtue of any further issue

of capital by way of rights, preferential issue, bonus issue etc. (which has been approved by a special

resolution through postal ballot wherein the votes cast by the shareholders other than the Promoters in favor

of the proposal amount to at least two times the number of votes cast by shareholders other than promoter

shareholders against the proposal and for which the company has obtained in-principal approval from the

main board), our Company shall apply to NSE for listing of its shares on its Main Board subject to the

fulfillment of the eligibility criteria for listing of specified securities laid down by the Main Board.

OR

b) If the paid-up Capital of our company is more than ₹10 Crores but below ₹25Crores, our Company may

still apply for migration to the main board if the same has been approved by a special resolution through

postal ballot wherein the votes cast by the shareholders other than the Promoters in favor of the proposal

amount to at least two times the number of votes cast by shareholders other than promoter shareholders

against the proposal.

Market Making

The shares offered though this issue is proposed to be listed on the NSE SME Platform wherein the Lead

Manager to the issue shall ensure compulsory Market Making through registered Market Makers of the NSE for

a minimum period of three years from the date of listing of shares offered through this Prospectus. For further

details of the Market Making arrangement see chapter titled “General Information-Details of the Market

Making Arrangements for this Issue” beginning on page 3 of this Prospectus.

In accordance with SEBI Circular No. CIR/MRD/DSA/31/2012 dated November 27, 2012; it has decided to

make applicable limits on the upper side for the Market Maker during market making process taking into

consideration the Issue size in the following manner:

Issue size

Buy quote exemption threshold (including

mandatory initial inventory of 5% of issue

size)

Re-entry threshold for buy quotes

(including mandatory initial inventory of

5% of issue size)

Up to ₹20 Crores 25% 24%

₹20 Crores to ₹50 Crores 20% 19%

Above ₹50 Crores to ₹80

Crores 15% 14%

Above ₹80 Crores 12% 11%

Further, the following shall apply to market maker while managing their inventory during the process of market

making:

(i) The exemption from threshold shall not be applicable for the first three months of market making and the

market maker shall be required to provide two way quotes during this period irrespective of the level of

holding. Any initial holdings over and above such 5% of issue size would not be counted towards the

inventory levels prescribed.

(ii) Apart from the above mandatory inventory, only those shares which have been acquired on the platform of

the exchange during market making process shall be counted towards the Market Maker's threshold.

Threshold limit will take into consideration, the inventory level across market maker.

243

(iii) The Market Maker shall give two way quotes till it reaches the upper limit threshold; thereafter it has the

option to give only sell quotes. Two way quotes shall be resumed the moment inventory reaches the

prescribed re-entry threshold.

(iv) In view of the Market Maker obligation, there shall be no exemption/threshold on downside. However, in

the event the Market Maker exhausts its inventory through market making process on the platform of the

exchange, the concerned stock exchange may intimate the same to SEBI after due verification.

(v) Provided, where there is any SEBI debarment order against the company/its promoters/directors, while the

SEBI debarment is in force against the company/its promoters/directors, it shall be mandatory for the

company to appoint a trading member of NSE as a market maker even after the completion of mandatory

period of three years. In case of any default during market making the penalties/actions will be imposed as

per the existing guidelines.

Arrangements for disposal Of Odd Lots

The trading of the Equity Shares will happen in the minimum contract size of 2,000 shares in terms of the SEBI

circular No. CIR/MRD/DSA/06/2012 dated February 21, 2012. However, the Market Maker shall buy the entire

shareholding of a shareholder in one lot, where value of such shareholding is less than the minimum contract

size allowed for trading on the NSE SME Platform.

Restrictions, if any, on Transfer and Transmission of Shares or Debentures and on their Consolidation or

Splitting

Except for lock-in of the pre-Issue Equity Shares and Promoter’s minimum contribution in the Issue as detailed

in the chapter ‘Capital Structure’ beginning on page no. 63 of this Prospectus and except as provided in the

Articles of Association, there are no restrictions on transfers of Equity Shares. There are no restrictions on

transmission of shares and on their consolidation / splitting except as provided in the Articles of Association.

For details please refer to the section titled ‘Main Provisions of the Articles of Association’ beginning on page

no. 288 of this Prospectus. The above information is given for the benefit of the Applicants. The Applicants are

advised to make their own enquiries about the limits applicable to them. Our Company and the Lead Manager

do not accept any responsibility for the completeness and accuracy of the information stated hereinabove. Our

Company and the Lead Manager are not liable to inform the investors of any amendments or modifications or

changes in applicable laws or regulations, which may occur after the date of the Prospectus. Applicants are

advised to make their independent investigations and ensure that the number of Equity Shares Applied for do

not exceed the applicable limits under laws or regulations.

Option to receive securities in Dematerialized Form

In accordance with the SEBI ICDR Regulations, Allotment of Equity Shares to successful applicants will only

be in the dematerialized form. Applicants will not have the option of Allotment of the Equity Shares in physical

form. The Equity Shares on Allotment will be traded only on the dematerialized segment of the Stock Exchange.

Allottees shall have the option to re-materialize the Equity Shares, if they so desire, as per the provisions of the

Companies Act and the Depositories Act.

New Financial Instruments

There are no new financial instruments such as deep discounted bonds, debenture, warrants, secured premium

notes, etc. issued by our Company.

Application by eligible NRIs, FPIs Registered with SEBI, VCFs, AIFs registered with SEBI and QFIs

It is to be understood that there is no reservation for Eligible NRIs or FPIs or QFIs or VCFs or AIFs registered

with SEBI. Such Eligible NRIs, QFIs, FPIs, VCFs or AIFs registered with SEBI will be treated on the same

basis with other categories for the purpose of Allocation.

244

ISSUE STRUCTURE

This Issue is being made in terms of Regulation 106(M) (1) of Chapter XB of SEBI (ICDR) Regulations, 2009,

as amended from time to time, whereby, an issuer, whose post issue face value capital does not exceeds ten

crore rupees. The Company shall issue specified securities to the public and propose to list the same on the

Small and Medium Enterprise Exchange ("SME Exchange", in this case being the EMERGE Platform of

National Stock Exchange of India Limited). For further details regarding the salient features and terms of such

an issue please refer chapter titled “Terms of the Issue” and “Issue Procedure” on page 238 and 246 of this Draft

Prospectus.

Following is the Issue Structure:

Public Issue of 24,00,000 Equity shares of face value of ₹10 each fully paid (the ‘Equity Shares’) for cash at a

price of ₹ 51 per Equity Share aggregating to ₹ 1224 Lacs (‘the Issue’) by our Company. The Issue comprises a

Net Issue to Public of 22,80,000 Equity Shares (‘the Net Issue‛) and a reservation of 1,20,000 Equity Shares for

subscription by the designated Market Maker (‘the Market Maker Reservation Portion’).

This Issue is made through the Fixed Price Issue Process.

Particulars of the Issue Net Issue to Public* Maker Reservation

Portion

Number of Equity Shares available for

allocation

22,80,000 Equity Shares 1,20,000 Equity Shares

Percentage of Issue Size available for

allocation

95.00% of the Issue Size 5.00% of the Issue Size

Basis of Allotment Proportionate basis, subject to

minimum allotment of 2,000

Equity Shares each.

For further details, please refer to

the ‘Basis of Allotment’ on page

no. 244 of this Prospectus

Firm Allotment

Mode of Application All the Applicants (online &

physical) through ASBA process

Through ASBA process

only

Minimum Application Size For QIB & NII:

Such number of Equity Shares in

multiples of 2,000 Equity Shares

such that the application size

exceeds ₹2,00,000

1,20,000 Equity Shares

For Retail Individual Investors:

2,000 Equity Shares

Maximum Application Size For QIB & NII:



such that application size does

not exceed 22,80,000 Equity

Shares

1,20,000 Equity Shares

For Retail Individual Investors:



such that application value does

not exceed ₹2,00,000

Mode of Allotment Dematerialized form only Dematerialized form only

Trading Lot 2,000 Equity Shares 2,000 Equity Shares

Terms of Payment The entire bid amount will be payable at the time of submission

of the Application Form

This Issue is being made in terms of Chapter XB of the SEBI (ICDR) Regulations through the Fixed Price

method and hence, as per Sub-regulation (4) of Regulation 43, of SEBI (ICDR) Regulations, the allocation of

Net Issue to the public category shall be made as follows:

245

(A) At least 50% to retail individual investors; and

(B) Remaining 50% to other than retail individual investors, subject to valid Applications being

received.

The unsubscribed portion in either of the categories specified in (a) or (b) above may be allocated to

the applicants in the other category.


the retail individual investors shall be allocated that higher percentage.


Our Company in consultation with the Lead Manager, reserves the right not to proceed with this Issue at any

time before the Issue Opening Date, without assigning any reason thereof.

In case, the Company wishes to withdraw the Issue after Issue Opening but before allotment, the Company will

give public notice giving reasons for withdrawal of Issue. The public notice will appear in two widely

circulated national newspapers (one each in English and Hindi) and one in regional newspaper.

The Lead Manager, through the Registrar to the Issue, will instruct the SCSBs, to unblock the ASBA Accounts

within one Working Day from the day of receipt of such instruction. The notice of withdrawal will be issued in

the same newspapers where the pre-issue advertisements have appeared and the Stock Exchange will also be

informed promptly.

If the Company withdraws the Issue after the Issue Closing Date and subsequently decides to undertake a

public offering/Issue of Equity Shares, the Company will file a fresh Draft Prospectus with the stock exchange

where the Equity Shares may be proposed to be listed.

Notwithstanding the foregoing, this Issue is subject to obtaining (i) the final listing and trading approvals of the

Stock Exchange, which our Company will apply for only after Allotment; and (ii) the final RoC approval to the

Draft Prospectus after it is filed with the RoC.

Issue Programme

Event Indicative Date

Issue Opening Date [●]

Issue Closing Date [●]

Applications and any revisions to the same will be accepted only between 10.00 a.m. to 5.00 p.m. (Indian

Standard Time) during the Issue Period at the Application Centers mentioned in the Application Form, or in the

case of ASBA Applicants, at the Designated Bank Branches except that on the Issue Closing Date applications

will be accepted only between 10.00 a.m. and 3.00 p.m. (Indian Standard Time).

Applications will be accepted only on Working Days, i.e., Monday to Friday (excluding any public holiday).

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ISSUE PROCEDURE

All Applicants should review the General Information Document for Investing in Public Issues prepared and

issued in accordance with the circular (CIR/CFD/DIL/12/2013) dated October 23, 2013 notified by SEBI

(“General Information Document”)included below under section ‘PART B–General Information Document’,

which highlights the key rules, processes and procedures applicable to public issues in general in accordance

with the provisions of the Companies Act 2013, the Securities Contracts (Regulation) Act, 1956, the Securities

Contracts (Regulation)Rules, 1957 and the SEBI ICDR Regulations as amended. The General Information

Document has been updated to include reference to the Securities and Exchange Board of India (Foreign

Portfolio Investors)Regulations, 2014, SEBI (Listing Obligation and Disclosure Regulations), 2015. The

General Information Document is also available on the websites of the Stock Exchange and the Lead Manager.

Please refer to the relevant portions of the General Information Document which are applicable to this Issue.

Please note that the information stated/covered in this section may not be complete and/or accurate and as such

would be subject to modification/change. Our Company and the Lead Manager do not accept any responsibility

for the completeness and accuracy of the information stated in this section and the General Information

Document. Our Company and the Lead Manager would not be liable for any amendment, modification or

change in applicable law, which may occur after the date of this Prospectus. Applicants are advised to make

their independent investigations and ensure that their Applications do not exceed the investment limits or

maximum number of Equity Shares that can be held by them under applicable law or as specified in this

Prospectus and the Final Prospectus.

This section applies to all the Applicants, Please note that all the Applicants are required to make payment of

the full Application Amount along with the Application Form.

PART A

Fixed Price Issue Procedure

This Issue is being made in terms of Regulation 106(M)(1) of Chapter XB of SEBI (ICDR) Regulations, 2009

via Fixed Price Process.

Applicants are required to submit their Applications to the designated intermediaries such as SCSB or

Registered Brokers of Stock Exchanges or Registered Registrars to the Issue and Share Transfer Agents (RTAs)

or Depository Participants (DPs) registered with SEBI.

In case of QIB Applicants, the Company in consultation with the Lead Manager may reject Applications at the

time of acceptance of Application Form provided that the reasons for such rejection shall be provided to such

Applicant in writing.

In case of Non-Institutional Applicants and Retail Individual Applicants, our Company would have a right to

reject the Applications only on technical grounds.

As per the provisions of Section 29(1) of the Companies Act, 2013, the Allotment of Equity Shares in the Issue

shall be only in a de-materialized form. The Equity Shares on Allotment shall, however, be traded only in the

dematerialized segment of the Stock Exchange.

Our Company or the Lead Managers will not be responsible for loss, if any, incurred by the Applicant on

account of conversion of foreign currency. There is no reservation for Eligible NRIs, FPIs and FVCIs and all

Applicants will be treated on the same basis with other categories for the purpose of allocation.

Application Form

Pursuant to SEBI Circular dated January 01, 2016 and bearing No. CIR/CFD/DIL/1/2016, the Application Form

has been standardized. Applicants shall only use the specified Application Form for the purpose of making an

Application in terms of this Prospectus. The Application Form shall contain space for indicating number of

specified securities subscribed for in demat form.

Applicants shall submit an Application Form either in physical or electronic form to the SCSB’s authorizing

blocking funds that are available in the bank account specified in the Application Form.

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The prescribed color of the Application Form for various categories is as follows:

Category Color of Application

Form

Resident Indians and Eligible NRIs applying on a non- repatriation basis

(ASBA)

White

Eligible NRIs, FVCIs, FIIs, their Sub-Accounts (other than Sub-Accounts which

are foreign corporates or foreign individuals bidding under the QIB Portion),

applying on a repatriation basis (ASBA)

Blue

In accordance with SEBI circular No. CIR/CFD/POLICYCELL/11/2015 dated November 10, 2015 all the

Applicants has to compulsorily apply through the ASBA Process.

Applicants shall only use the specified Application Form for the purpose of making an Application in terms of

this Prospectus. An Investor, intending to subscribe to this Issue, shall submit a completed application form to

any of the following Intermediaries (collectively called “Designated Intermediaries”)

Sr.

No.

Designated Intermediaries

1) An SCSB, with whom the bank account to be blocked, is maintained

2) A syndicate member (or sub-syndicate member)

3) A stock broker registered with a recognized stock exchange (and whose name is mentioned on the

website of the stock exchange as eligible for this activity) (‘Broker’

4) A depository participant (‘DP’) (whose name is mentioned on the website of the stock exchange as

eligible

5) A registrar to an issue and share transfer agent (‘RTA’) (whose name is mentioned on the website of

the stock exchange as eligible for this activity)

The aforesaid intermediary shall, at the time of receipt of application, give an acknowledgement to investor, by

giving the counter foil or specifying the application number to the investor, as a proof of having accepted the

application form, in physical or electronic mode, respectively.

The upload of the details in the electronic bidding system of the Stock Exchange will be done by:

For applications

submitted by

investors to SCSB

: After accepting the form, SCSB shall capture and upload the relevant details in the

electronic bidding system as specified by the stock exchange(s) and may begin

blocking funds available in the bank account specified in the form, to the extent of the

application money specified.

For applications

submitted by

investors to

intermediaries

other than SCSBs

: After accepting the application form, respective intermediary shall capture and upload

the relevant details in the electronic bidding system of stock exchange(s). Post

uploading, they shall forward a schedule as per prescribed format along with the

application forms to designated branches of the respective SCSBs for blocking of

funds within one day of closure of Issue.

Availability of Prospectus and Application Forms

The Application Forms and copies of the Prospectus may be obtained from the Registered Office Memorandum

Form 2A containing the salient features of the Prospectus together with the Application Forms and copies of the

Prospectus may be obtained from the Registered Office of our Company, Lead Manager to the Issue or the

Registrar to the Issue as mentioned in the Application Form. The application forms may also be downloaded

from the website of NSE i.e. www.nseindia.com.

Who can apply?

Persons eligible to invest under all applicable laws, rules, regulations and guidelines: -

Indian national’s resident in India who are not incompetent to contract in single or joint names (not more

than three) or in the names of minors as natural/legal guardian;

Hindu Undivided Families or HUFs, in the individual name of the Karta. The applicant should specify that

the application is being made in the name of the HUF in the Application Form as follows: Name of Sole or

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First applicant: XYZ Hindu Undivided Family applying through XYZ, where XYZ is the name of the

Karta. Applications by HUFs would be considered at par with those from individuals;

Companies, Corporate Bodies and Societies registered under the applicable laws in India and authorized to

invest in the Equity Shares under the irrespective constitutional and charter documents;

Mutual Funds registered with SEBI;

Eligible NRI son are patriation basis or on a non-repatriation basis, subject to applicable laws.NRIs other

than Eligible NRIs are not eligible to participate in this Issue;

Indian Financial Institutions, scheduled commercial banks, regional rural banks, co-operative banks (subject

to RBI permission, and the SEBI Regulations and other laws, as applicable);

FIIs and sub-accounts registered with SEBI, other than a sub-account which is a foreign corporate or a

foreign individual under the QIB Portion;

Limited Liability Partnerships (LLPs) registered in India and authorized to invest in equity shares;

Sub-accounts of FIIs registered with SEBI, which are foreign corporates or foreign individuals only under

the Non-Institutional applicant’s category;

Alternative Investment Funds, Venture Capital Funds, Foreign Venture Capital Investors registered with

SEBI;

Portfolio Manager registered with SEBI;

State Industrial Development Corporations;

Trusts/societies registered under the Societies Registration Act, 1860, as amended, or under any other law

relating to Trusts and who are authorized under their constitution to hold and invest in equity shares;

Scientific and/or Industrial Research Organizations authorized to invest in equity shares;

Insurance Companies registered with Insurance Regulatory and Development Authority, India;

Provident Funds with minimum corpus of ₹2,500 Lakhs and who are authorized under their constitution to

hold and invest in equity shares;

Pension Funds with minimum corpus of ₹2,500 Lakhs and who are authorized under their constitution to

hold and invest in equity shares;

Multilateral and Bilateral Development Financial Institutions;

National Investment Fund set up by resolution no. F. No. 2/3/2005-DDII dated November 23, 2005 of

Government of India published in the Gazette of India;

Insurance funds set up and managed by army, navy or air force of the Union of India

As per the existing regulations, OCBs cannot participate in this Issue.

Participation by Associates/Affiliates of Lead Manager and Syndicate Members

The Lead Manager and the Syndicate Members shall not be entitled to subscribe to this Issue in any manner

except towards fulfilling their underwriting obligations. However, associates and affiliates of the Lead Manager

and Syndicate Member, if any, may subscribe to Equity Shares in the Issue, either in the QIB Portion and Non-

Institutional Portion, as may be applicable to such applicants, where the allotment is on a proportionate basis.

All categories of Applicants, including associates and affiliates of the Lead Manager and the Syndicate Member,

shall be treated equally for the purpose of allocation to be made on a proportionate basis.

Option to Subscribe in the Issue

a) As per Section 29(1) of the Companies Act 2013, Investors will get the allotment of Equity Shares in

dematerialization form only.

b) The Equity Shares, on allotment, shall be traded on Stock Exchange in demat segment only.

c) In a single Application Form any investor shall not exceed the investment limit/minimum number of

specifiedsecurities that can be held by him/her/it under the relevant regulations/statutory guidelines and

applicable law.

Application by Indian Public including Eligible NRIs applying on Non-Repatriation basis

Application must be made only in the names of individuals, limited companies or Statutory Corporations /

Institutions and not in the names of minors, foreign nationals, non-residents (except for those applying on non-

repatriation), trusts, (unless the trust is registered under the Societies Registration Act, 1860 or any other

applicable trust laws and is authorized under its constitution to hold shares and debentures in a company), Hindu

Undivided Families, partnership firms or their nominees. In case of HUF’s applications shall be made by the

Karta of the HUF. An applicant in the Net Public Category cannot make an application for that number of

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Equity Shares exceeding the number of Equity Shares offered to the public. Eligible NRIs applying on a non-

repatriation basis may make payments by inward remittance in foreign exchange through normal banking

channels or by debits to NRE / FCNR accounts as well as NRO accounts.

Applications by Eligible NRIs/RFPIs on Repatriation Basis

Application Forms have been made available for eligible NRIs at our Registered Office and at the Registered

Office of the Lead Manager. Eligible NRI Applicants may please note that only such applications as are

accompanied by payment in free foreign exchange shall be considered for Allotment under the reserved

category. The eligible NRIs who intend to make payment through Non-Resident Ordinary (NRO) accounts shall

use the Forms meant for Resident Indians and should not use the forms meant for the reserved category. Under

FEMA, general permission is granted to companies vide notification no. FEMA/20/2000 RB dated 03/05/2000

to issue securities to NRIs subject to the terms and conditions stipulated therein. Companies are required to file

the declaration in the prescribed form to the concerned Regional Office of RBI within 30 days from the date of

issue of shares for allotment to NRIs on repatriation basis. Allotment of equity shares to Non-Resident Indians

shall be subject to the prevailing Reserve Bank of India Guidelines. Sale proceeds of such investments in equity

shares will be allowed to be repatriated along with the income thereon subject to permission of the RBI and

subject to the Indian tax laws and regulations and any other applicable laws.

As per the current regulations, the following restrictions are applicable for investments by FPIs:

1) Foreign Portfolio Investor shall invest only in the following securities, namely- (a) Securities in the primary

and secondary markets including shares, debentures and warrants of companies, listed or to be listed on a

recognized stock exchange in India; (b) Units of schemes floated by domestic mutual funds, whether listed

on a recognized stock exchange or not; (c) Units of schemes floated by a collective investment scheme; (d)

Derivatives traded on a recognized stock exchange; (e) Treasury bills and dated government securities; (f)

Commercial papers issued by an Indian company; (g) Rupee denominated credit enhanced bonds; (h)

Security receipts issued by asset reconstruction companies; (i) Perpetual debt instruments and debt capital

instruments, as specified by the Reserve Bank of India from time to time; (j) Listed and unlisted non-

convertible debentures/bonds issued by an Indian company in the infrastructure sector, where

‗infrastructure‘ is defined in terms of the extant External Commercial Borrowings (ECB) guidelines; (k)

Non-convertible debentures or bonds issued by Non-Banking Financial Companies categorized as

‗Infrastructure Finance Companies‘(IFCs) by the Reserve Bank of India; (l) Rupee denominated bonds or

units issued by infrastructure debt funds; (m) Indian depository receipts; and (n) Such other instruments

specified by the Board from time to time.

2) Where a foreign institutional investor or a sub account, prior to commencement of these regulations, holds

equity shares in a company whose shares are not listed on any recognized stock exchange, and continues to

hold such shares after initial public offering and listing thereof, such shares shall be subject to lock-in for

the same period, if any, as is applicable to shares held by a foreign direct investor placed in similar position,

under the policy of the Government of India relating to foreign direct investment for the time being in force.

3) In respect of investments in the secondary market, the following additional conditions shall apply:

(a) A foreign portfolio investor shall transact in the securities in India only on the basis of taking and

giving delivery of securities purchased or sold;

(b) Nothing contained in clause (a) shall apply to:

(i) Any transactions in derivatives on a recognized stock exchange;

(ii) Short selling transactions in accordance with the framework specified by the Board;

(iii) Any transaction in securities pursuant to an agreement entered into with the merchant banker in the

process of market making or subscribing to unsubscribed portion of the issue in accordance with

Chapter XB of the Securities and Exchange Board of India (Issue of Capital and Disclosure

Requirements) Regulations, 2009;

(iv) Any other transaction specified by the Board.

(c) No transaction on the stock exchange shall be carried forward;

(d) The transaction of business in securities by a foreign portfolio investor shall be only through stock

brokers registered by the Board; provided nothing contained in this clause shall apply to:

(i) transactions in Government securities and such other securities falling under the purview of the

Reserve Bank of India which shall be carried out in the manner specified by the Reserve Bank of

India;

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(ii) Sale of securities in response to a letter of offer sent by an acquirer in accordance with the

Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers)

Regulations, 2011;

(iii) Sale of securities in response to an offer made by any promoter or acquirer in accordance with the

Securities and Exchange Board of India (Delisting of Equity shares) Regulations, 2009;

(iv) Sale of securities, in accordance with the Securities and Exchange Board of India (Buyback of

securities) Regulations, 1998;

(v) Divestment of securities in response to an offer by Indian Companies in accordance with Operative

Guidelines for Disinvestment of Shares by Indian Companies in the overseas market through issue

of American Depository Receipts or Global Depository Receipts as notified by the Government of

India and directions issued by Reserve Bank of India from time to time;

(vi) Any bid for, or acquisition of, securities in response to an offer for disinvestment of shares made

by the Central Government or any State Government;

(vii) Any transaction in securities pursuant to an agreement entered into with merchant banker in the

process of market making or subscribing to unsubscribed portion of the issue in accordance with

Chapter XB of the Securities and Exchange Board of India (Issue of Capital and Disclosure

Requirements) Regulations, 2009;

(viii) Any other transaction specified by the Board.

(e) A foreign portfolio investor shall hold, deliver or cause to be delivered securities only in dematerialized

form:

Provided that any shares held in non-dematerialized form, before the commencement of these

regulations, can be held in non-dematerialized form, if such shares cannot be dematerialized.

Unless otherwise approved by the Board, securities shall be registered in the name of the foreign

portfolio investor as a beneficial owner for the purposes of the Depositories Act, 1996.

4) The purchase of equity shares of each company by a single foreign portfolio investor or an investor group

shall be below ten percent of the total issued capital of the company.

5) The investment by the foreign portfolio investor shall also be subject to such other conditions and

restrictions as may be specified by the Government of India from time to time.

6) In cases where the Government of India enters into agreements or treaties with other sovereign

Governments and where such agreements or treaties specifically recognize certain entities to be distinct and

separate, the Board may, during the validity of such agreements or treaties, recognize them as such, subject

to conditions as may be specified by it.

7) A foreign portfolio investor may lend or borrow securities in accordance with the framework specified by

the Board in this regard.

No foreign portfolio investor may issue, subscribe to or otherwise deal in offshore derivative instruments,

directly or indirectly, unless the following conditions are satisfied:

(a) Such offshore derivative instruments are issued only to persons who are regulated by an appropriate foreign

regulatory authority;

(b) Such offshore derivative instruments are issued after compliance with know your client’s norms:

Provided that those unregulated broad-based funds, which are classified as Category II foreign portfolio investor

by virtue of their investment manager being appropriately regulated shall not issue, subscribe or otherwise deal

in offshore derivatives instruments directly or indirectly:

Provided further that no Category III foreign portfolio investor shall issue, subscribe to or otherwise deal in

offshore derivatives instruments directly or indirectly.

A foreign portfolio investor shall ensure that further issue or transfer of any offshore derivative instruments

issued by or on behalf of it is made only to persons who are regulated by an appropriate foreign regulatory

authority.

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Foreign portfolio investors shall fully disclose to the Board any information concerning the terms of and parties

to off-shore derivative instruments such as participatory notes, equity linked notes or any other such

instruments, by whatever names they are called, entered into by it relating to any securities listed or proposed to

be listed in any stock exchange in India, as and when and in such form as the Board may specify.

Any offshore derivative instruments issued under the Securities and Exchange Board of India (Foreign

Institutional Investors) Regulations, 1995 before commencement of SEBI (Foreign Portfolio Investors)

Regulations, 2014 shall be deemed to have been issued under the corresponding provisions of SEBI (Foreign

Portfolio Investors) Regulations, 2014.

The purchase of equity shares of each company by a single foreign portfolio investor or an investor group shall

be below 10% of the total issued capital of the company.

A FII or its subaccount which holds a valid certificate of registration shall, subject to payment of conversion

fees, be eligible to continue to buy, sell or otherwise deal in securities till the expiry of its registration as a

foreign institutional investor or sub-account, or until he obtains a certificate of registration as foreign portfolio

investor, whichever is earlier.

A qualified foreign investor may continue to buy, sell or otherwise deal in securities subject to the provisions of

the SEBI (Foreign Portfolio Investors) Regulations, 2014, for a period of one year from the date of

commencement of the aforesaid regulations, or until it obtains a certificate of registration as foreign portfolio

investor, whichever is earlier.

Application by Mutual Funds

With respect to Applications by Mutual Funds, a certified copy of their SEBI registration certificate must be

lodged with the Application Form. Failing this, our Company reserves the right to reject any application without

assigning any reason thereof.

Applications made by asset management companies or custodians of Mutual Funds shall specifically state

names of the concerned schemes for which such Applications are made. As per the current regulations, the

following restrictions are applicable for investments by mutual funds:

No mutual fund scheme shall invest more than 10% of its net asset value in the Equity Shares or equity related

instruments of any single Company provided that the limit of 10% shall not be applicable for investments in

case of index funds or sector or industry specific funds/Schemes. No mutual fund under all its schemes should

own more than 10% of any Company’s paid up share capital carrying voting rights.

In case of a Mutual Fund, a separate Application can be made in respect of a scheme of the Mutual Fund

registered with SEBI and such Applications in respect of more than one scheme of the Mutual Fund will not be

treated as multiple applications provided that the Applications clearly indicate the scheme concerned for which

the Application has been made.

Applications by SEBI registered Alternative Investment Fund (AIF), Venture Capital Funds and Foreign

Venture Capital Investors

The SEBI (Venture Capital) Regulations, 1996 and the SEBI (Foreign Venture Capital Investor) Regulations,

2000 prescribe investment restrictions on venture capital funds and foreign venture capital investors registered

with SEBI. As per the current regulations, the following restrictions are applicable for SEBI registered venture

capital funds and foreign venture capital investors:

Accordingly, the holding by any individual venture capital fund registered with SEBI in one company should

not exceed 25% of the corpus of the venture capital fund; a Foreign Venture Capital Investor can invest its entire

funds committed for investments into India in one company. Further, Venture Capital Funds and Foreign

Venture Capital Investor can invest only upto 33.33% of the funds available for investment by way of

subscription to an Initial Public Offer.

The SEBI (Alternative Investment Funds) Regulations, 2012 prescribes investment restrictions for various

categories of AIF’s.

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The category I and II AIFs cannot invest more than 25% of the corpus in one Investee Company. A category III

AIF cannot invest more than 10% of the corpus in one Investee Company. A venture capital fund registered as a

category I AIF, as defined in the SEBI AIF Regulations, cannot invest more than 33.33% of its corpus by way of

subscription to an Initial Public Offering of a venture capital undertaking. Additionally, the VCFs which have

not re-registered as an AIF under the SEBI AIF Regulations shall continue to be regulated by the VCF

Regulations.

Our Company or the Lead Manager will not be responsible for loss, if any, incurred by the Applicant on account

of conversion of foreign currency.

There is no reservation for Eligible NRIs, FPIs and FVCIs and all Applicants will be treated on the same basis

for the purpose of allocation.

Applications by Limited Liability Partnerships

In case of applications made by limited liability partnerships registered under the Limited Liability Partnership

Act, 2008, a certified copy of certificate of registration issued under the Limited Liability Partnership Act, 2008,

must be attached to the Application Form. Failing this, our Company reserves the right to reject any application,

without assigning any reason thereof. Limited Liability Partnerships can participate in the Issue only through the

ASBA process.

Applications by Insurance Companies

In case of applications made by insurance companies registered with the IRDA, a certified copy of certificate of

registration issued by IRDA must be attached to the Application Form. Failing this, our Company reserves the

right to reject any application, without assigning any reason thereof. The exposure norms for insurers,

prescribed under the Insurance Regulatory and Development Authority (Investment) Regulations, 2000, as

amended (the “IRDA Investment Regulations”), are broadly set forth below:

1) Equity Shares of a Company: the least of 10% of the investee company’s subscribed capital (face value) or

10% of the respective fund in case of life insurer or 10% of investment assets in case of general insurer or

reinsurer;

2) The entire group of the Investee Company: the least of 10% of the respective fund in case of a life insurer or

10% of investment assets in case of a general insurer or re-insurer (25% in case of ULIPS); and

3) The industry sector in which the investee Company operates: 10% of the insurer’s total investment exposure

to the industry sector (25% in case of ULIPS).

In addition, the IRDA partially amended the exposure limits applicable to investments in public limited

companies in the infrastructure and housing sectors on December 26, 2008, providing, among other things, that

the exposure of an insurer to an infrastructure company may be increased to not more than 20%, provided that in

case of equity investment, a dividend of not less than 4% including bonus should have been declared for at least

five preceding years. This limit of 20% would be combined for debt and equity taken together, without sub

ceilings.

Further, investments in equity including preference shares and the convertible part of debentures shall not

exceed 50% of the exposure norms specified under the IRDA Investment Regulations.

Application under Power of Attorney

In case of applications made pursuant to a power of attorney by limited companies, corporate bodies, registered

societies, FIIs, Mutual Funds, insurance companies and provident funds with minimum corpus of ₹2,500 Lakhs

(subject to applicable law) and pension funds with a minimum corpus of ₹2,500 Lakhs a certified copy of the

power of attorney or the relevant resolution or authority, as the case may be, along with a certified copy of the

memorandum of association and articles of association and/or bye laws must be lodged with the Application

Form. Failing this, our Company reserves the right to accept or reject any application in whole or in part, in

either case, without assigning any reason therefore.

In addition to the above, certain additional documents are required to be submitted by the following entities:

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(a) With respect to applications by VCFs, FVCIs, FIIs and Mutual Funds, a certified copy of their SEBI

registration certificate must be lodged along with the Application Form. Failing this, our Company reserves

the right to accept or reject any application, in whole or in part, in either case without as signing any reasons

thereof.

(b) With respect to applications by insurance companies registered with the Insurance Regulatory and

Development Authority, in addition to the above, a certified copy of the certificate of registration issued by

the Insurance Regulatory and Development Authority must be lodged with the Application Form as

applicable. Failing this, our Company reserves the right to accept or reject any application, in whole or in

part, in either case without assigning any reasons thereof.

(c) With respect to applications made by Provident Fund with minimum corpus of ₹2,500 Lacs (subject to

applicable law) and Pension Fund with a minimum corpus of ₹2,500 Lakhs, a certified copy of a certificate

from a Chartered Accountant certifying the corpus of the Provident Fund / Pension Fund must be lodged

along with the Application Form. Failing this, our Company reserves the right to accept or reject such

application, in whole or in part, in either case without assigning any reasons thereof.

Our Company in its absolute discretion, reserves the right to relax the above condition of simultaneous lodging

of the Power of Attorney along with the Application Form, subject to such terms and conditions that our

Company and the Lead Manager may deem fit.

Our Company, in its absolute discretion, reserves the right to permit the holder of the Power of Attorney to

request the Registrar to the Issue that, for the purpose of mailing of the Allotment Advice /CANs/ letters

notifying the unblocking of the bank accounts of ASBA applicants, the Demographic Details given on the

Application Form should be used (and not those obtained from the Depository of the application). In such cases,

the Registrar to the Issue shall use Demographic Details as given on the Application Form instead of those

obtained from the Depositories.

The above information is given for the benefit of the Applicants. The Company and the Lead Manager are not

liable for any amendments or modification or changes in applicable laws or regulations, which may occur after

the date of this Prospectus. Applicants are advised to make their independent investigations and ensure that the

number of Equity Shares applied for do not exceed the applicable limits under laws or regulations.

Applications by Banking Companies

In case of Applications made by banking companies registered with RBI, certified copies of: (i) the certificate of

registration issued by RBI and (ii) the approval of such banking company’s investment committee are required

to be attached to the Application Form, failing which our Company reserve the right to reject any Application

without assigning any reason.

The investment limit for banking companies as per the Banking Regulation Act, 1949 as amended is 30.00% of

the paid-up share capital of the investee company or 30.00% of the banks own paid up share capital and

reserves, whichever is less (except in certain specified exceptions, such as setting up or investing in a subsidiary,

which requires RBI approval). Further, the RBI Master Circular of July 01, 2015 sets forth prudential norms

required to be followed for classification, valuation and operation of investment portfolio of banking companies.

Applications by SCSBs

SCSBs participating in the Offer are required to comply with the terms of the SEBI circulars dated September

13, 2012 and January 02, 2013. Such SCSBs are required to ensure that for making applications on their own

account using ASBA, they should have a separate account in their own name with any other SEBI registered

SCSBs. Further, such account shall be used solely for the purpose of making application in public issues and

clear demarcated funds should be available in such account for such application.

Application by Provident Funds / Pension Funds

In case of applications made by Provident Fund/Pension Fund, subject to applicable laws, with minimum corpus

of ₹2,500 Lakhs, a certified copy of certificate from a chartered accountant certifying the corpus of the

Provident Fund/ Pension Fund must be attached to the Application Form. Failing this, our Company reserves the

254

right to reject any application, without assigning any reason thereof.

Terms of Payment / Payment Instructions

The entire Issue price of ₹ 51/- per share is payable on application. In case of allotment of lesser number of

Equity Shares than the number applied, the Registrar shall instruct the SCSBs to unblock the excess amount

paid on Application to the Applicants.

All Applicants are required to make use ASBA for applying in the Issue

Application Amount cannot be paid in cash, through money order, cheque or through postal order or

through stock invest.

Applicants may submit the Application Form in physical mode to the Designated Intermediaries.

Applicants must specify the Bank Account number in the Application Form. The Application Form

submitted by an Applicant and which is accompanied by cash, demand draft, money order, postal order or

any mode of payment other than blocked amounts in the ASBA Account maintained with an SCSB, will not

be accepted.

Applicants should ensure that the Application Form is also signed by the ASBA Account holder(s) if the

Applicant is not the ASBA Account holder;

Applicants shall note that for the purpose of blocking funds under ASBA facility clearly demarcated funds

shall be available in the account.

From one ASBA Account, a maximum of five Applications can be submitted.

Applicants applying directly through the SCSBs should ensure that the Application Form is submitted to a

Designated Branch of a SCSB where the ASBA Account is maintained.

Upon receipt of the Application Form, the Designated Branch of the SCSB may verify if sufficient funds

equal to the Application Amount are available in the ASBA Account, as mentioned in the Application

Form.

If sufficient funds are available in the ASBA Account, the SCSB may block an amount equivalent to the

Application Amount mentioned in the Application Form and may upload the details on the Stock Exchange

Platform.

If sufficient funds are not available in the ASBA Account, the Designated Branch of the SCSB may not

upload such Applications on the Stock Exchange platform and such Applications are liable to be rejected.

Upon submission of a completed Application Form each Applicant may be deemed to have agreed to block

the entire Application Amount and authorized the Designated Branch of the SCSB to block the Application

Amount specified in the Application Form in the ASBA Account maintained with the SCSBs.

The Application Amount may remain blocked in the aforesaid ASBA Account until finalisation of the Basis

of Allotment and consequent transfer of the Application Amount against the Allotted Equity Shares to the

Public Issue Account, or until withdrawal or failure of the Issue, or until withdrawal or rejection of the

Application, as the case may be.

SCSBs applying in the Issue must apply through an ASBA Account maintained with any other SCSB; else

their Applications are liable to be rejected.

Maximum and Minimum Application Size

a) For Retail Individual Applicants

The Application must be for a minimum of 2,000 Equity Shares and in multiples of ₹2,000 equity shares

thereafter, so as to ensure that the Application amount payable by the Applicant does not exceed ₹2,00,000.

In case of revision of applications, the Retail Individual Applicants have to endure that the application

amount does not exceed ₹2,00,000.

b) For Other Applicants (Non-Institutional Applicants and QIBs)

The Application must be for a minimum of such number of Equity Shares such that the Application

Amount exceeds ₹2,00,000 and in multiples of 2,000 Equity Shares thereafter. An Application cannot be

submitted for more than the Net Issue Size. However, the maximum Application by a QIB investor should

not exceed the investment limits prescribed for them by applicable laws. Under existing SEBI Regulations,

a QIB Applicant cannot withdraw its Application after the Issue Closing Date and is required to pay 100%

QIB Margin upon submission of Application. In case of revision in Applications, the Non-Institutional

Applicants, who are individuals, have to ensure that the Application Amount is greater than ₹2,00,000 for

being considered for allocation in the Non-Institutional Portion.

Applicants are advised to ensure that any single Application from them does not exceed the investment

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limits or maximum number of Equity Shares that can be held by them under applicable law or regulation or

as specified in this Prospectus.

Information for the Applicants

1.) Our Company and the Lead Managers shall declare the Issue Opening Date and Issue Closing Date in the

Prospectus to be registered with the RoC and also publish the same in two national newspapers (one each in

English and Hindi) and in one regional newspaper with wide circulation. This advertisement shall be in the

prescribed format.

2.) Our Company will file the Prospectus with the RoC at least three days before the Issue Opening Date.

3.) Any Applicant who would like to obtain the Prospectus and/or the Application Form can obtain the same

from our Registered Office.

4.) Applicants who are interested in subscribing to the Equity Shares should approach any of the Application

Collecting Intermediaries or their authorised agent(s).

5.) Applications should be submitted in the prescribed Application Form only. Application Forms submitted to

the SCSBs should bear the stamp of the respective intermediary to whom the application form is submitted.

Application Forms submitted directly to the SCSBs should bear the stamp of the SCSBs and/or the

Designated Branch. Application Forms submitted by Applicants whose beneficiary account is inactive shall

be rejected.

6.) The Application Form can be submitted either in physical or electronic mode, to the Application Collecting

Intermediaries. Further Application Collecting Intermediary may provide the electronic mode of collecting

either through an internet enabled collecting and banking facility or such other secured, electronically

enabled mechanism for applying and blocking funds in the ASBA Account.

7.) Except for applications by or on behalf of the Central or State Government and the officials appointed by

the courts and by investors residing in the State of Sikkim, the Applicants, or in the case of application in

joint names, the first Applicant (the first name under which the beneficiary account is held), should mention

his/her PAN allotted under the Income Tax Act. In accordance with the SEBI Regulations, the PAN would

be the sole identification number for participants transacting in the securities market, irrespective of the

amount of transaction. Any Application Form without PAN is liable to be rejected. The demat accounts of

Applicants for whom PAN details have not been verified, excluding persons resident in the State of Sikkim

or persons who may be exempted from specifying their PAN for transacting in the securities market, shall

be suspended for credit‖ and no credit of Equity Shares pursuant to the Issue will be made into the accounts

of such Applicants.

8.) The Applicants may note that in case the PAN, the DP ID and Client ID mentioned in the Application Form

and entered into the electronic collecting system of the Stock Exchange by the Bankers to the Issue or the

SCSBs do not match with PAN, the DP ID and Client ID available inthe Depository database, the

Application Form is liable to be rejected.

Instructions for completing the Application Form

The Applications should be submitted on the prescribed Application Form and in BLOCK LETTERS in

English only in accordance with the instructions contained herein and in the Application Form. Applications not

so made are liable to be rejected. Application Forms should bear the stamp of the drafts intermediaries otherwise

it will be rejected.

Applicants residing at places where the designated branches of the Banker to the Issue are not located may

submit/ mail their applications at their sole risk along with Demand payable at Mumbai.

SEBI, vide Circular No. CIR/CFD/14/2012 dated October 04, 2012 has introduced an additional mechanism for

investors to submit Application Forms in Public Issues using the stock broker (“broker”) network of Stock

Exchanges, who may not be syndicate members in an issue with effect from January 01, 2013. The list of

Broker Centre is available on the websites of NSE i.e. www.nseindia.com.

Applicant’s Depository Account and Bank Details

Please note that, providing bank account details in the space provided in the application form is mandatory and

applications that do not contain such details are liable to be rejected.

Applicants should note that on the basis of name of the Applicants, Depository Participant’s name, Depository

Participant Identification number and Beneficiary Account Number provided by them in the Application Form,

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the Registrar to the Issue will obtain from the Depository the demographic details including address, Applicants

bank account details, MICR code and occupation (hereinafter referred to as ‘Demographic Details’). Applicants

should carefully fill in their Depository Account details in the Application Form.

These Demographic Details would be used for all correspondence with the Applicants including mailing of the

CANs/ Allocation Advice. The Demographic Details given by Applicants in the Application Form would not be

used for any other purpose by the Registrar to the Issue.

By signing the Application Form, the Applicant would be deemed to have authorized the depositories to

provide, upon request, to the Registrar to the Issue, the required Demographic Details as available on its records.

Basis of Allotment

Allotment will be made in consultation with the NSE. In the event of oversubscription, the allotment will be

made on a proportionate basis in marketable lots as set forth here:

1. The total number of Shares to be allocated to each category as a whole shall be arrived at on a proportionate

basis i.e. the total number of Shares applied for in that category multiplied by the inverse of the over

subscription ratio (number of applicants in the category x number of Shares applied for).

2. The number of Shares to be allocated to the successful Applicants will be arrived at on a proportionate basis

in marketable lots (i.e. Total number of Shares applied for in to the inverse of the oversubscription ratio).

3. For applications where the proportionate allotment works out to less than 2,000 shares the allotment will be

made as follows:

a) Each successful applicant shall be allotted 2,000 Equity Shares; and

b) The successful applicants out of the total applicants for that category shall be determined by the draw l

of lots in such a manner that the total number of Shares allotted in that category is equal to the number

of Shares worked out as per (2) above.

4. If the proportionate allotment to an applicant works out to a number that is not a multiple of 2,000 Equity

Shares, the applicant would be allotted Shares by rounding off to the nearest multiple of 2,000 Equity

Shares subject to a minimum allotment of 2,000 equity shares.

5. If the Shares allotted on a proportionate basis to any category is more than the Shares allotted to the

applicants in that category, the balance available Shares for allocation shall be first adjusted against any

category, where the allotted Shares are not sufficient for proportionate allotment to the successful applicants

in that category, the balance Shares, if any, remaining after such adjustment will be added to the category

comprising of applicants applying for the minimum number of Shares. If as a result of the process of

rounding off to the nearest multiple of 2,000 equity shares, results in the actual allotment being higher than

the shares offered, the final allotment may be higher at the sole discretion of the Board of Directors, up to

110% of the size of the offer specified under the Capital Structure mentioned in this Prospectus.

6. The above proportionate allotment of shares in an Issue that is oversubscribed shall be subject to the

reservation for small individual applicants as described below:

a) As the retail individual investor category is entitled to more than fifty percent on proportionate basis,

the retail individual investors shall be allocated that higher percentage.

b) The balance net offer of shares to the public shall be made available for allotment to

i. Individual applicants other than retails individual investors and

ii. Other investors, including Corporate Bodies/ Institutions irrespective of number of shares applied

for.

c) The unsubscribed portion of the net offer to anyone of the categories specified in a) or b) shall/may be

made available for allocation to applicants in the other category, if so required.

‘Retail Individual Investor’ means an investor who applies for shares of value of not more than ₹2,00,000.

Investors may note that in case of over subscription allotment shall be on proportionate basis and will be

finalized in consultation with NSE.

The Executive Director / Managing Director of NSE – the Designated Stock Exchange in addition to Lead

Manager and Registrar to the Public Issue shall be responsible to ensure that the basis of allotment is finalized in

a fair and proper manner in accordance with the SEBI (ICDR) Regulations.

Payment by Stock Invest

In terms of the Reserve Bank of India circular No. DBOD No. FSC BC 42/ 24.47.00/ 2003-04 dated November

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05, 2003; the option to use the stock invest instrument in lieu of cheques or bank drafts for payment of

Application money has been withdrawn. Hence, payment through stock invest would not be accepted in this

Issue.

General Instructions:

Do’s:

Check if you are eligible to apply;

Read all the instructions carefully and complete the applicable Application Form;

Ensure that the details about Depository Participant and Beneficiary Account are correct as Allotment

of Equity Shares will be in the dematerialized form only;

Each of the Applicants should mention their Permanent Account Number (PAN) allotted under the

Income Tax Act,1961;

Ensure that the Demographic Details(as defined herein below) are up dated, true and correct in all

respects;

Ensure that the name(s) given in the Application Form is exactly the same as the name(s) in which the

beneficiary account is held with the Depository Participant.

All Applicants should submit their application through ASBA process only.

Ensure that you have funds equal to the Application Amount in your bank account maintained with the

SCSB before submitting the Application Form to the respective Designated Branch of the SCSB;

Ensure that the Application Form is signed by the account holder in case the applicant is not the

account holder. Ensure that you have mentioned the correct bank account number in the Application

Form;

Ensure that you have requested for and receive a acknowledgement\

Investors shall note that persons banned from accessing capital market are ineligible of investing in the

offer.

Don’ts:

Do not apply for lower than the minimum Application size;

Do not apply at a Price Different from the Price Mentioned herein or in the Application Form;

Do not apply on another Application Form after you have submitted an Application to the Bankers of

the Issue;

Do not pay the Application Price in cash, by money order or by postal order or by stock invest;

Do not send Application Forms by post; instead submit the same to the Selected Branches/Offices of

the Banker to the Issue;

Do not fill up the Application Form such that the Equity Shares applied for exceeds the Issue Size and/

or investment limit or maximum number of Equity Shares that can be held under the applicable laws or

regulations or maximum amount permissible under the applicable regulations;

Do not submit the GIR number instead of the PAN as the Application is liable to be rejected on this

ground.

Other Instructions

Joint Applications in the case of Individuals

Applications may be made in single or joint names (not more than three). In the case of joint Applications, all

payments will be made out in favour of the Applicant whose name appears first in the Application Form or

Revision Form. All communications will be addressed to the First Applicant and will be dispatched to his or her

address as per the Demographic Details received from the Depository.

Multiple Applications

An Applicant should submit only one Application (and not more than one) for the total number of Equity Shares

required. Two or more Applications will be deemed to be multiple Applications if the sole or First Applicant is

one and the same.

In this regard, the procedures which would be followed by the Registrar to the Issue to detect multiple

applications are given below:

(i) All applications are electronically strung on first name, address (1st line) and applicant’s status. Further,

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these applications are electronically matched for common first name and address and if matched, these are

checked manually for age, signature and father / husband’s name to determine if they are multiple

applications.

(ii) Applications which do not qualify as multiple applications as per above procedure are further checked for

common DP ID/ beneficiary ID. In case of applications with common DP ID/ beneficiary ID, are manually

checked to eliminate possibility of data entry error to determine if they are multiple applications.

(iii) Applications which do not qualify as multiple applications as per above procedure are further checked for

common PAN. All such matched applications with common PAN are manually checked to eliminate

possibility of data capture error to determine if they are multiple applications.

In case of a mutual fund, a separate Application can be made in respect of each scheme of the mutual fund

registered with SEBI and such Applications in respect of more than one scheme of the mutual fund will not be

treated as multiple Applications provided that the Applications clearly indicate the scheme concerned for which

the Application has been made.

In cases where there are more than 20 valid applications having a common address, such shares will be kept in

abeyance, post allotment and released on confirmation of‘ Know Your Client’ norms by the depositories. The

Company reserves the right to reject, in our absolute discretion, all or any multiple Applications in any or all

categories.

Permanent Account Number or PAN

Pursuant to the circular MRD/DoP/Circ 05/2007 dated April 27, 2007, SEBI has mandated Permanent Account

Number (‘PAN‛) to be the sole identification number for all participants transacting in the securities market,

irrespective of the amount of the transaction w.e.f. July 02, 2007. Each of the Applicants should mention his /

her PAN allotted under the IT Act. Applications without this information will be considered incomplete and are

liable to be rejected. It is to be specifically noted that Applicants should not submit the GIR number instead of

the PAN, as the Application is liable to be rejected on this ground.

Right to Reject Applications

In case of QIB Applicants, the Company in consultation with the Lead Manager may reject Applications

provided that the reasons for rejecting the same shall be provided to such Applicant in writing. In case of Non-

Institutional Applicants, Retail Individual Applicants who applied, the Company has a right to reject

Applications based on technical grounds.

Grounds for Rejections

Applicants are advised to note that Applications are liable to be rejected inter alia on the following technical

grounds:

Amount paid does not tally with the amount payable for the Equity Shares applied for;

In case of partnership firms, Equity Shares may be registered in the names of the individual partners and no

firm as such shall be entitled to apply;

Application by persons not competent to contract under the Indian Contract Act, 1872 including minors,

insane persons;

PAN not mentioned in the Application Form;

GIR number furnished instead of PAN;

Applications for lower number of Equity Shares than specified for that category of investors;

Applications at a price other than the Fixed Price of the Issue;

Applications for number of Equity Shares which are not in multiples of 3,000

Category not ticked;

Multiple Applications as defined in this Prospectus;

In case of Application under power of attorney or by limited companies, corporate, trust etc., where relevant

documents are not submitted;

Applications accompanied by Stock invest/ money order/ postal order/cash;

Signature of sole Applicant is missing;

Application Forms are not delivered by the Applicant within the time prescribed as per the Application

Forms, Issue Opening Date advertisement and the Prospectus and as per the instructions in the Prospectus

and the Application Forms;

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In case no corresponding record is available with the Depositories that matches three parameters namely,

names of the Applicants (including the order of names of joint holders), the Depository Participant’s

identity (DP ID) and the beneficiary’s account number;

Applications for amounts greater than the maximum permissible amounts prescribed by the regulations;

Applications by OCBs;

Applications by US persons other than in reliance on Regulations or “qualified institutional buyers” as

defined in Rule 144A under the Securities Act;

Applications not duly signed by the sole Applicant;

Applications by any persons outside India if not in compliance with applicable foreign and Indian laws;

Applications that do not comply with the securities laws of the irrespective jurisdictions are liable to be

rejected;

Applications by persons prohibited from buying, selling or dealing in the shares directly or in directly by

SEBI or any other regulatory authority;

Applications by persons who are not eligible to acquire Equity Shares of the Company in terms of all

applicable laws, rules, regulations, guidelines, and approvals;

Applications or revisions thereof by QIB Applicants, Non-Institutional Applicants where the Application

Amount is in excess of ₹2,00,000 received after 3.00 pm on the Issue Closing Date;

Impersonation

Attention of the applicants is specifically drawn to the provisions of section 38(1) of the Companies Act, 2013

which is reproduced below:

Any person who:

a. makes or abets making of an application in a fictitious name to a company for acquiring, or subscribing for,

its securities; or

b. makes or abets making of multiple applications to a company in different names or in different

combinations of his name or surname for acquiring or subscribing for its securities; or

c. otherwise induces directly or in directly a company to allot, or register any transfer of, securities to him, or

to any other person in a fictitious name,

Shall be liable for action under section 447 of Companies Act, 2013 and shall be treated as Fraud.

Signing of Underwriting Agreement

Vide an Underwriting agreement dated [•] this issue is 100% Underwritten.

Filing of the Prospectus with the RoC

The company will file a copy of the Prospectus with the Registrar of Companies, Chandigarh in terms of Section

26 of Companies Act, 2013.

Pre-Issue Advertisement

Subject to Section 30 of the Companies Act, 2013 the Company shall, after registering the Prospectus with the

RoC, publish a pre-Issue advertisement, in the form prescribed by the SEBI Regulations, in one widely

circulated English language national daily newspaper; one widely circulated Hindi language national daily

newspaper and one regional newspaper with wide circulation. In the pre-issue advertisement, we shall state the

Issue Opening Date and the Issue Closing Date. This advertisement, subject to the provisions of Section 30 of

the Companies Act, 2013, shall be in the format prescribed in Part A of Schedule XIII of the SEBI Regulations.

Designated Date and Allotment of Equity Shares

The Company will issue and dispatch letters of allotment/ securities certificates and/ or letters of regret or credit

the allotted securities to the respective beneficiary accounts, if any within a period of 4 working days of the

Issue Closing Date. In case the Company issues Letters of allotment, the corresponding Security Certificates

will be kept ready within two months from the date of allotment thereof or such extended time as may be

approved by the National Company Law Tribunal under Section 56 of the Companies Act, 2013 or other

applicable provisions, if any. Allottees are requested to preserve such Letters of Allotment, which would be

exchanged later for the Security Certificates. After the funds are transferred from the SCSB’s to Public Issue

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Account on the Designated Date, the Company would ensure the credit to the successful Applicants depository

account. Allotment of the Equity Shares to the Allottees shall be within one working day of the date of approval

of Basis of Allotment by Designated Stock Exchange. Investors are advised to instruct their Depository

Participants to accept the Equity Shares that may be allocated/ allotted to them pursuant to this issue.

Payment of Refund

In the event that the listing of the Equity Shares does not occur in the manner described in this Prospectus, the

Lead Manager shall intimate Public Issue Bank and Public Issue Bank shall transfer the funds from Public Issue

account to Refund Account as per the written instruction from Lead Manager and the Registrar for further

payment to the beneficiary applicants.

Undertakings by our Company

The Company undertakes the following:

1. that if our Company do not proceed with the Issue after the Issue Closing Date, the reason thereof shall be

given as a public notice in the newspapers to be issued by our Company within two days of the Issue

Closing Date. The public notice shall be issued in the same newspapers in which the Pre- Issue

advertisement was published. The stock exchange on which the Equity Shares are proposed to be listed

shall also be informed promptly;

2. that if our Company withdraw the Issue after the Issue Closing Date, our Company shall be required to file

afresh offer document with the ROC/SEBI, in the event our Company subsequently decides to proceed with

the Issue;

3. That the complaints received in respect of this Issue shall be attended to by us expeditiously and

satisfactorily;

4. That all steps shall be taken to ensure that listing and commencement of trading of the Equity Shares at the

Stock Exchange where the Equity Shares are proposed to be listed are taken within six Working Days of

Issue Closing Date or such time as prescribed;

5. That if Allotment is not made within the prescribed time period under applicable law, the entire

subscription amount received will be unblocked within the time prescribed under applicable law. If there is

delay beyond the prescribed time, our Company shall pay interest prescribed under the Companies Act,

2013, the ICDR Regulations and applicable law for the delayed period;

6. That the letter of allotment/ unblocking of funds to the non-resident Indians shall be dispatched within

specified time; and

7. That no further issue of Equity Shares shall be made till the Equity Shares offered through this Prospectus

are listed.

Utilization of Issue Proceeds

Our Board certifies that:

1. All monies received out of the Issue shall be credited/ transferred to a separate bank account other than the

bank account referred to in Section 40 of the Companies Act, 2013;

2. Details of all monies utilized out of the issue referred to in point 1 above shall be disclosed and continued to

be disclosed till the time any part of the issue proceeds remains unutilized under an appropriate separate

head in the balance-sheet of the issuer indicating the purpose for which such monies had been utilized;

3. Details of all unutilized monies out of the Issue referred to in 1, if any shall be disclosed under the

appropriate head in the balance sheet indicating the form in which such unutilized monies have been

invested and

4. Our Company shall comply with the requirements of SEBI (Listing Obligations & Disclosure

Requirements) Regulations, 2015 in relation to the disclosure and monitoring of the utilization of the

proceeds of the Issue.

5. Our Company shall not have recourse to the Issue Proceeds until the approval for listing and trading of the

Equity Shares from the Stock Exchange where listing is sought has been received.


Our Company, in consultation with the Lead Manager, reserves the right not to proceed with the Issue, in whole

or any part thereof at any time after the Issue Opening Date but before the Allotment, with assigning reason

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thereof .The notice of withdrawal will be issued in the same newspapers where the pre-Issue advertisements

have appeared within Two days of Issue Closing Date or such other time as may be prescribed by SEBI,

providing reasons for such decision and. The Lead Manager, through the Registrar to the Issue, will instruct the

SCSBs to unblock the ASBA Accounts within one Working Day from the day of receipt of such instruction. Our

Company shall also inform the same to the Stock Exchanges on which Equity Shares are proposed to be listed.

Notwithstanding the foregoing, the Issue is also subject to obtaining the following:

1. The final RoC approval of the Prospectus after it is filed with the concerned RoC.

2. The final listing and trading approvals of the Stock Exchange, which our Company shall apply for after

Allotment and if our Company withdraws the Issue after the Issue Closing Date and thereafter determines

that it will proceed with an initial public offering of Equity Shares, our Company shall file a fresh

prospectus with stock exchange.

Equity Shares in Dematerialized Form with NSDL or CDSL

To enable all shareholders of the Company to have their shareholding in electronic form, the Company has

entered into following tripartite agreements with the Depositories and the Registrar and Share Transfer Agent:

(a) We have entered into tripartite agreement between NSDL, the Company and the Registrar to the Issue dated

May 03, 2018;

(b) We have entered into tripartite agreement between CDSL, the Company and the Registrar to the Issue dated

April 25, 2018;

The Company’s Equity shares bear an ISIN Number INE00GJ01017

An Applicant applying for Equity Shares must have at least one beneficiary account with either of the

Depository Participants of either NSDL or CDSL prior to making the Application.

The Applicant must necessarily fill in the details (including the Beneficiary Account Number and

Depository Participant’s identification number) appearing in the Application Form or Revision Form.

Allotment to a successful Applicant will be credited in electronic form directly to the beneficiary account

(with the Depository Participant) of the Applicant.

Names in the Application Form or Revision Form should be identical to those appearing in the account

details in the Depository. In case of joint holders, the names should necessarily be in the same sequence as

they appear in the account details in the Depository.

If incomplete or incorrect details are given under the heading ‘Applicants Depository Account Details’ in

the Application Form or Revision Form, it is liable to be rejected.

The Applicant is responsible for the correctness so this or her Demographic Details given in the Application

Form Vis à Vis those with his or her Depository Participant.

Equity Shares in electronic form can be traded only on the stock exchanges having electronic connectivity

with NSDL and CDSL. The Stock Exchange where our Equity Shares are proposed to be listed has

electronic connectivity with CDSL and NSDL.

The allotment and trading of the Equity Shares of the Company would be in dematerialized form only for

all investors.

Communications

All future communications in connection with the Applications made in this Issue should be addressed to the

Registrar to the Issue quoting the full name of the sole or First Applicant, Application Form number, Applicants

Depository Account Details, number of Equity Shares applied for, date of Application form, name and address

of the Banker to the Issue where the Application and a copy of the acknowledgement slip. Investors can contact

the Compliance Officer or the Registrar to the Issue in case of any pre-issue or post-issue related problems such

as non-receipt of letters of allotment, credit of allotted shares in the respective beneficiary accounts etc.

In accordance with the SEBI Circular No. CIR/CFD/POLICYCELL/11/2015 dated November 10, 2015 all the

Applicants has to compulsorily apply through the ASBA Process. Our Company and the Lead Manager are not

liable for any amendments, modifications, or changes in applicable laws or regulations, which may occur after

the date of this Prospectus. ASBA Applicants are advised to make the in dependent investigations and to ensure

that the ASBA Application Form is correctly filled up, as described in this section.

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This section is for the information of investors proposing to subscribe to the Issue through the ASBA process.

Our Company and the Lead Manager are not liable for any amendments, modifications, or changes in applicable

laws or regulations, which may occur after the date of this Prospectus. ASBA Applicants are advised to make

their independent investigations and to ensure that the ASBA Application Form is correctly filled up, as

described in this section. The lists of banks that have been notified by SEBI to act as SCSB (Self Certified

Syndicate Banks) for the ASBA Process are provided onwww.sebi.gov.in. For details on designated branches of

SCSB collecting the Application Form, please refer the above mentioned SEBI link.

ASBA Process

A Resident Retail Individual Investor shall submit his Application through an Application Form, either in

physical or electronic mode, to the SCSB with whom the bank account of the ASBA Applicant or bank account

utilized by the ASBA Applicant (‘ASBA Account‛) is maintained. The SCSB shall block an amount equal to the

Application Amount in the bank account specified in the ASBA Application Form, physical or electronic, on the

basis of an authorization to this effect given by the account holder at the time of submitting the Application.

The Application Amount shall remain blocked in the aforesaid ASBA Account until finalization of the Basis of

Allotment in the Issue and consequent transfer of the Application Amount against the allocated shares to the

ASBA Public Issue Account, or until withdrawal/failure of the Issue or until withdrawal/rejection of the

Application, as the case may be.

The ASBA data shall thereafter be uploaded by the SCSB in the electronic IPO system of the Stock Exchange.

Once the Basis of Allotment is finalized, the Registrar to the Issue shall send an appropriate request to the

Controlling Branch of the SCSB for unblocking the relevant bank accounts and for transferring the amount

allocable to the successful Applicants to the ASBA Public Issue Account. In case of withdrawal / failure of the

Issue, the blocked amount shall be unblocked on receipt of such information from the Lead Manager.

Applicants are required to submit their Applications, either in physical or electronic mode. In case of application

in physical mode, the Applicant shall submit the ASBA Application Format the Designated Branch of the

SCSB. In case of application in electronic form, the ASBA Applicant shall submit the Application Form either

through the internet banking facility available with the SCSB, or such other electronically enabled mechanism

for applying and blocking funds in the ASBA account held with SCSB, and accordingly registering such

Applications.

Who can apply?

In accordance with the SEBI (ICDR) Regulations, 2009 in public issues w.e.f. May 01, 2010 all the investors

can apply through ASBA process and after SEBI circular no. CIR/CFD/POLICYCELL/11/2015 dated

November 10, 2015 all investors must apply through the ASBA Process.

Mode of Payment

Upon submission of an Application Form with the SCSB, whether in physical or electronic mode, each ASBA

Applicant shall be deemed to have agreed to block the entire Application Amount and authorized the Designated

Branch of the SCSB to block the Application Amount, in the bank account maintained with the SCSB.

Application Amount paid in cash, by money order or by postal order or by stock invest, or ASBA Application

Form accompanied by cash, money order, postal order or any mode of payment other than blocked amounts in

the SCSB bank accounts, shall not be accepted.

After verifying that sufficient funds are available in the ASBA Account, the SCSB shall block an amount

equivalent to the Application Amount mentioned in the ASBA Application Form till the Designated Date.

On the Designated Date, the SCSBs shall transfer the amounts allocable to the Applicants from the respective

ASBA Account in terms of the SEBI Regulations, into the Public Issue Account. The balance amount, if any

against the said Application in the ASBA Accounts shall then be unblocked by the SCSBs on the basis of the

instructions issued in this regard by the Registrar to the Issue.

The entire Application Amount, as per the Application Form submitted by the respective Applicants, would be

required to be blocked in the respective ASBA accounts until finalization of the Basis of Allotment in the Issue

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and consequent transfer of the Application Amount against allocated shares to the Public Issue Account, or until

withdrawal / failure of the Issue or until rejection of the Application, as the case may be.

Unblocking of ASBA Account

On the basis of instructions from the Registrar to the Issue, the SCSBs shall transfer the requisite amount against

each successful ASBA Applicant to the Public Issue Account as per the provisions of section 40(3) of the

Companies Act, 2013 and shall unblock excess amount, if any in the ASBA Account. However, the Application

Amount may be unblocked in the ASBA Account prior to receipt of intimation from the Registrar to the Issue

by the Controlling Branch of the SCSB regarding finalization of the Basis of Allotment in the Issue, in the event

of withdrawal/failure of the Issue or rejection of the ASBA, as the case maybe.

PART - B

GENERAL INFORMATION DOCUMENT FOR INVESTING IN PUBLIC ISSUES

This General Information Document highlights the key rules, processes and procedures applicable to public

issues in accordance with the provisions of the Companies Act, 2013 (to the extent notified and in effect), the

Companies Act, 1956 (without reference to the provisions thereof that have ceased to have effect upon the

notification of the Companies Act, 2013), the Securities Contracts (Regulation) Act, 1956, the Securities

Contracts (Regulation) Rules, 1957 and the Securities and Exchange Board of India (Issue of Capital and

Disclosure Requirements) Regulations, 2009. Bidders/Applicants should not construe the contents of this

General Information Document as legal advice and should consult their own legal counsel and other advisors in

relation to the legal matters concerning the Issue. For taking an investment decision, the Bidders/Applicants

should rely on their own examination of the Issuer and the Issue, and should carefully read the Prospectus

/Prospectus before investing in the Issue.

SECTION 1: PURPOSE OF THE GENERAL INFORMATION DOCUMENT (GID)

This document is applicable to the public issues undertaken inter-alia through Fixed Price Issues. The purpose of

the -General Information Document for Investing in Public Issues‖ is to provide general guidance to potential

Applicants in IPOs, on the processes and procedures governing IPOs, undertaken in accordance with the

provisions of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)

Regulations, 2009 (“SEBI ICDR Regulations, 2009”). Applicants should note that investment in equity and

equity related securities involves risk and Applicant should not invest any funds in the Issue unless they can

afford to take the risk of losing their investment. The specific terms relating to securities and/or for subscribing

to securities in an Issue and the relevant information about the Issuer undertaking the Issue; are set out in the

Prospectus filed by the Issuer with the Registrar of Companies (“RoC”). Applicants should carefully read the

entire Prospectus and the Application Form and the Abridged Prospectus of the Issuer in which they are

proposing to invest through the Issue. In case of any difference in interpretation or conflict and/or overlap

between the disclosure included in this document and the Prospectus, the disclosures in the

Prospectus shall prevail. The Prospectus of the Issuer is available on the websites of stock exchanges, on the

website(s) of the LM(s) to the Issue and on the website of Securities and Exchange Board of India (“SEBI”) at

www.sebi.gov.in.

For the definitions of capitalized terms and abbreviations used herein Applicants may refer to the section

‘Glossary &Abbreviations’.

SECTION 2: BRIEF INTRODUCTION TO IPOs ON SME EXCHANGE

2.1. Initial Public Offer (IPO)

An IPO means an offer of specified securities by an unlisted Issuer to the public for subscription and may

include an Offer for Sale of specified securities to the public by any existing holder of such securities in an

unlisted Issuer.

For undertaking an IPO, an Issuer is inter-alia required to comply with the eligibility requirements of in terms of

either Regulation 26(1) or Regulation 26(2) of the SEBI ICDR Regulations, 2009, if applicable. For details of

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compliance with the eligibility requirements by the Issuer, Applicants may refer to the Prospectus.

The Issuer may also undertake IPO under chapter XB of the SEBI (ICDR) Regulations, wherein as per:

Regulation 106M (1): An issuer whose post-issue face value Capital does not exceed Ten Crores rupees

shall issue its specified securities in accordance with provisions of this Chapter.

Regulation 106M (2): An issuer, whose post issue face value capital, is more than Ten Crores rupees and

upto Twenty Five Crores rupees, may also issue specified securities in accordance with provisions of this

Chapter.

The present Issue is being made under Regulation 106M(1) of Chapter XB of SEBI (ICDR) Regulation.

2.2. Other Eligibility Requirements

In addition to the eligibility requirements specified in paragraphs 2.1, an Issuer proposing to undertake an IPO is

required to comply with various other requirements as specified in the SEBI ICDR Regulations, 2009, the

Companies Act, 1956 and the Companies Act, 2013 as may be applicable (the ―Companies Act‖), The

Securities Contracts (Regulation) Rules, 1957 (the ―SCRR‖), industry-specific regulations, if any, and other

applicable laws for the time being in force. Following are the eligibility requirements for making an SME IPO

under Regulation 106M (2) of Chapter XB of SEBI (ICDR) Regulation:

(a.) In accordance with regulation 106(P) of the SEBI (ICDR) Regulations, Issue has to be 100% underwritten

and the LM has to underwrite at least 15% of the total issue size.

(b.) In accordance with Regulation 106(R) of the SEBI (ICDR) Regulations, total number of proposed allottees

in the Issue shall be greater than or equal to fifty, otherwise, the entire application money will be refunded

forthwith. If such money is not repaid within eight days from the date the company becomes liable to repay

it, than the Company and every officer in default shall, on and from expiry of eight days, be liable to repay

such application money, with interest as prescribed under section 40 of the Companies Act, 2013

(c.) In accordance with Regulation 106(O) the SEBI (ICDR) Regulations, Company is not required to file any

Offer Document with SEBI nor has SEBI issued any observations on the Offer Document. The Lead

Manager shall submit the copy of Prospectus along with a Due Diligence Certificate including additional

confirmations as required to SEBI at the time of filing the Prospectus with Stock Exchange and the

Registrar of Companies.

(d.) In accordance with Regulation 106(V) of the SEBI ICDR Regulations, the LM has to ensure compulsory

market making for a minimum period of three years from the date of listing of Equity Shares offered in the

Issue.

(e.) The company should have track record of at least locks.

(f.) The company should have positive cash accruals (earnings before depreciation and tax) from operations for

at least 2 financial years preceding the application and its net-worth should be positive.

(g.) The post issue paid up capital of the company (face value) shall not be more than ₹25 Crores.

(h.) The Issuer shall mandatorily facilitate trading in demat securities.

(i.) The Issuer should not been referred to Board for Industrial and Financial Reconstruction.

(j.) No petition for winding up is admitted by a court or a liquidator has not been appointed of competent

jurisdiction against the Company.

(k.) No material regulatory or disciplinary action should have been taken by any stock exchange or regulatory

authority in the past three years against the Issuer.

(l.) The Company should have a website.

(m.) There has been no change in the promoter of the Company in the one year preceding the date of filing

application to NSE Limited for listing on their SME platform.

Issuer shall also comply with all the other requirements as laid down for such an Issue under Chapter XB of

SEBI (ICDR) Regulations and subsequent circulars and guidelines issued by SEBI and the Stock Exchange.

As per Regulation 106(M)(3) of SEBI (ICDR) Regulations, 2009, the provisions of Regulations 6(1), 6(2), 6(3),

Regulation 8, Regulation 9, Regulation 10, Regulation 25, Regulation 26, Regulation 27 and Sub regulation (1)

of Regulation 49 of SEBI (ICDR) Regulations, 2009 shall not apply to this Issue.

Thus Company is eligible for the Issue in accordance with regulation 106 M (1) and other provisions of chapter

XB of the SEBI (ICDR) Regulations as the post issue face value capital does not exceeds ₹1,000 lakhs.

Company also complies with the eligibility conditions laid by the NSE for listing of its Equity Shares.

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2.3. Types of Public Issues-Fixed Price Issues and Book Built Issues

In accordance with the provisions of the SEBI ICDR Regulations, 2009, an Issuer can either determine the Issue

Price through the Book Building Process (“Book Built Issue”) or undertake a Fixed Price Issue (“Fixed Price

Issue”). An Issuer may mention Floor Price or Price Band in the RHP (in case of a Book Built Issue) and a Price

or Price Band in the Prospectus (in case of a fixed price Issue) and determine the price at a later date before

registering the Prospectus with the Registrar of Companies.

The cap on the Price Band should be less than or equal to 120% of the Floor Price. The Issuer shall announce

the Price or the Floor Price or the Price Band through advertisement in all newspapers in which the pre-issue

advertisement was given at least five Working Days before the Issue Opening Date, in case of an IPO and at

least one Working Day before the Issue Opening Date, in case of an FPO.

The Floor Price or the Issue price cannot be lesser than the face value of the securities. Applicants should refer

to the Prospectus or Issue advertisements to check whether the Issue is a Book Built Issue or a Fixed Price Issue.

2.4. Issue Period

The Issue shall be kept open for a minimum of three Working Days (for all category of Applicants) and not

more than ten Working Days. Applicants are advised to refer to the Application Form and Abridged Prospectus

or Prospectus for details of the Issue Period. Details of Issue Period are also available on the website of Stock

Exchange(s).

2.5. Migration to Main Board

Our company may migrate to the Main board of NSE from SME platform of NSE on a later date subject to the

following:

(a.) If the Paid up Capital of our Company is likely to increase above ₹2,500 lakhs by virtue of any further issue

of capital by way of rights issue, preferential issue, bonus issue etc.(which has been approved by a special

resolution through postal ballot wherein the votes cast by the shareholders other than the Promoter in favour

of the proposal amount to at least two times the number of votes cast by shareholders other than promoter

shareholders against the proposal and for which the company has obtained in-principal approval from the

Main Board), our Company shall apply to NSE for listing of its shares on its Main Board subject to the

fulfilment of the eligibility criteria for listing of specified securities laid down by the Main Board.

OR

(b.) If the Paid up Capital of our company is more than ₹1,000 lakhs but below ₹2,500 lakhs, our Company may

still apply for migration to the Main Board and if the Company fulfils the eligible criteria for listing laid by

the Main Board and if the same has been approved by a special resolution through postal ballot wherein the

votes cast by the shareholders other than the Promoter in favour of the proposal amount to at least two times

the number of votes cast by shareholders other than promoter shareholders against the proposal.

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2.6. Flowchart of Timelines

A flow chart of process flow in Fixed Price Issues is as follows:

SECTION 3: CATEGORY OF INVESTORS ELIGIBLE TO PARTICIPATE IN AN ISSUE

Each Applicant should check whether it is eligible to apply under applicable law. Further more, certain

categories of Applicants, such as NRIs, FPIs and FVCIs may not be allowed to apply in the Issue or to hold

Equity Shares, in excess of certain limits specified under applicable law. Applicants are requested to refer to the

Prospectus for more details.

Subject to the above, an illustrative list of Applicants is as follows:

(i.) Indian nationals resident in India who are not incompetent to contract in single or joint names (not more

than three) or in the names of minors through natural/legal guardian;

(ii.) Hindu Undivided Families or HUFs in the individual name of the Karta. The Applicant should specify that

the application is being made in the name of the HUF in the Application Form as follows: Name of Sole or

First applicant: XYZ Hindu Undivided Family applying through XYZ ,where XYZ is the name of the

Karta. Applications by HUFs would be considered at par withthose from individuals;

(iii.) Companies, Corporate Bodies and Societies registered under the applicable laws in India and authorized to

invest in the Equity Shares under their respective constitutional and charter documents;

(iv.) Mutual Funds registered with SEBI;

(v.) Eligible NRIs on a repatriation basis or on a non-repatriation basis, subject to applicable laws. NRIs other

than Eligible NRIs are not eligible to participate in this Issue;

(vi.) Indian Financial Institutions, scheduled commercial banks, regional rural banks, co-operative banks (subject

to RBI permission, and the SEBI Regulations and other laws, as applicable);

(vii.) FPIs other than Category III FPI; VCFs and FVCIs registered with SEBI

(viii.) Limited Liability Partnerships (LLPs) registered in India and authorized to invest in equity shares;

(ix.) State Industrial Development Corporations;

(x.) Trusts/societies registered under the Societies Registration Act, 1860, as amended, or under any other law

relating to Trusts and who are authorized under their constitution to hold and invest inequity shares;

(xi.) Scientific and/or Industrial Research Organizations authorized to invest in equity shares;

(xii.) Insurance Companies registered with IRDA;

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(xiii.) Provident Funds and Pension Funds with minimum corpus of ₹2,500 Lakhs and who are authorized under

their constitution to hold and invest in equity shares;

(xiv.) Multilateral and Bilateral Development Financial Institutions;

(xv.) National Investment Fund set up by resolution no. F. No. 2/3/2005-DDII dated November 23,2005 of

Government of India published in the Gazette of India;

(xvi.) Insurance funds set up and managed by army, navy or air force of the Union of India or by Department of

Posts, India;

(xvii.) Any other person eligible to apply in this Issue, under the laws, rules, regulations, guidelines and policies

applicable to them and under Indian laws. As per the existing regulations, OCBs cannot participate in this

Issue.

SECTION 4: APPLYING IN THE ISSUE

Fixed Price Issue: Applicants should only use the specified Application Form either bearing the stamp of

Application Collecting Intermediaries as available or downloaded from the websites of the Stock Exchanges.

Application Forms are available Designated Branches of the SCSBs, at the registered office of the Issuer and at

the registered office of LM. For further details regarding availability of Application Forms, Applicants may

refer to the Prospectus.

Applicants should ensure that they apply in the appropriate category. The prescribed colour of the Application

Form for various categories of Applicants is as follows:

Category Color of the Application

Resident Indian, Eligible NRIs applying on a non-repatriation basis White

NRIs, FVCIs, FPIs, their Sub-Accounts (other than Sub-Accounts which are

foreign corporate(s) or foreign individuals applying under the QIB), on a

repatriation basis

Blue

Anchor Investors (where applicable) & Applicants applying in the reserved

category

Not Applicable

Securities Issued in an IPO can only be in dematerialized form in compliance with Section 29 of the Companies

Act, 2013. Applicants will not have the option of getting the allotment of specified securities in physical form.

However, they may get the specified securities rematerialized subsequent to allotment.

1.1. Instructions for Filing the Application Form (Fixed Price Issue)

Applicants may note that forms not filled completely or correctly as per instructions provided in this GID,

the Prospectus and the Application Form are liable to be rejected. Instructions to fill each field of the

Application Form can be found on the reverse side of the Application Form. Specific instructions for filling

various fields of the Resident Application Form and Non-Resident Application Form and samples are

provided below.

The samples of the Application Form for resident Applicants and the Application Form for Non-Resident

Applicants are reproduced below:

Application Form-R

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Application Form-NR

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1.1.1.Field Number 1: Name and Contact Details of the Sole/First Applicant

Applicants should ensure that the name provided in this field is exactly the same as the name in which the

Depository Account is held.

(a.) Mandatory Fields: Applicants should note that the name and address fields are compulsory and e-mail

and/or telephone number/ mobile number fields are optional. Applicants should note that the contact details

mentioned in the Application Form may be used to dispatch communications in case the communication

sent to the address available with the Depositories are returned/undelivered or are not available. The contact

details provided in the Application Form may be used by the Issuer, the members of the Syndicate, the

Registered Broker and the Registrar to the Issue only for correspondence(s) related to an Issue and for no

other purposes.

(b.) Joint Applications: In the case of Joint Applications, the Applications should be made in the name of the

Applicant whose name appears first in the Depository account. The name so entered should be the same as

it appears in the Depository records. The signature of only such first Applicant would be required in the

Application Form and such first Applicant would be deemed to have signed on behalf of the joint holders.

All payments may be made out in favour of the Applicant whose name appears in the Application Form or

the Revision Form and all communications may be addressed to such Applicant and may be dispatched to

his or her address as per the Demographic Details received from the Depositories.

(c.) Impersonation: Attention of the Applicants is specifically drawn to the provisions of sub section(1) of

Section 38 of the Companies Act, 2013 which is reproduced below:

Any person who:

makes or abets making of an application in a fictitious name to a Company for acquiring, or

subscribing for, its securities;

ormakes or abets making of multiple applications to a Company in different names or indifferent

combinations of his name or surname for acquiring or subscribing for its securities; or

otherwise induces directly or indirectly a Company to allot, or register any transfer of securities to him,

or to any other person in a fictitious name,

Shall be liable for action under section 447 of the said Act.

(d.) Nomination Facility to Applicant: Nomination facility is available in accordance with the provisions of

Section 72 of the Companies Act, 2013. In case of allotment of the Equity Shares in dematerialized form,

there is no need to make a separate nomination as the nomination registered with the Depository may

prevail. For changing nominations, the Applicants should inform their respective DP.

1.1.2.Field Number 2: PAN of Sole/First Applicant

(a.) PAN (of the sole/ first Applicant) provided in the Application Form should be exactly the same as the PAN

of the person(s) in whose name the relevant beneficiary account is held as per the Depositories‘ records.

(b.) PAN is the sole identification number for participants transacting in the securities market irrespective of the

amount of transaction except for Applications on behalf of the Central or State Government, Applications

by officials appointed by the courts and Applications by Applicants residing in Sikkim (―PAN Exempted

Applicants‖). Consequently, all Applicants, other than the PAN Exempted Applicants, are required to

disclose their PAN in the Application Form, irrespective of the Application Amount. An Application Form

without PAN, except in case of Exempted Applicants, is liable to be rejected. Applications by the

Applicants whose PAN is not available as per the Demographic Details available in their Depository

records, are liable to be rejected.

(c.) The exemption for the PAN Exempted Applicants is subject to (a) the Demographic Details received from

the respective Depositories confirming the exemption granted to the beneficiary owner by a suitable

description in the PAN field and the beneficiary account remaining in active status; and (b) in the case of

residents of Sikkim, the address as per the Demographic Details evidencing the same.

(d.) Application Forms which provide the General Index Register Number instead of PAN may be rejected.

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(e.) Applications by Applicants whose demat accounts have been ‗suspended for credit‘ are liable tobe rejected

pursuant to the circular issued by SEBI on July 29, 2010, bearing number CIR/MRD/DP/22/2010. Such

accounts are classified as ―Inactive demat accounts‖ and demographic details are not provided by

depositories.

1.1.3.Field Number 3: Applicants Depository Account Details

(a.) Applicants should ensure that DP ID and the Client ID are correctly filled in the Application Form. The DP

ID and Client ID provided in the Application Form should match with the DP ID and Client ID available in

the Depository database, otherwise, the Application Form is liable to be rejected.

(b.) Applicants should ensure that the beneficiary account provided in the Application Form is active.

(c.) Applicants should note that on the basis of DP ID and Client ID as provided in the Application Form, the

Applicant may be deemed to have authorized the Depositories to provide to the Registrar to the Issue, any

requested Demographic Details of the Applicant as available on the records of the depositories. These

Demographic Details may be used, among other things, for sending allocation advice and for other

correspondence(s) related to an Issue.

(d.) Applicants are, advised to update any changes to their Demographic Details as available in the records of

the Depository Participant to ensure accuracy of records. Any delay resulting from failure to update the

Demographic Details would be at the Applicant’s sole risk.

1.1.4.Field Number 4: Application Details

(a.) The Issuer may mention Price in the Prospectus. However a prospectus registered with RoC contains one

price.

(b.) Minimum And Maximum Application Size

(i.) For Retail Individual Applicants:

The Application must be for a minimum of 6,000 Equity Shares. As the Application Price payable by

the Retail Individual Applicants cannot exceed ₹2,00,000, they can make Application for only

minimum Application size i.e. for 6,000 Equity Shares.

(ii.) For Other Applicants (Non Institutional Applicants and QIBs):

The Application must be for a minimum of such number of Equity Shares such that the Application

Amount exceeds ₹2,00,000 and in multiples of 6,000 Equity Shares thereafter. An Application cannot

be submitted for more than the Issue Size. However, the maximum Application by a QIB investor

should not exceed the investment limits prescribed for them by applicable laws. Under existing SEBI

Regulations, a QIB Applicant cannot withdraw its Application after the Issue Closing Date and is

required to pay 100% QIB Margin upon submission of Application. In case of revision in Applications,

the Non Institutional Applicants, who are individuals, have to ensure that the Application Amount

isgreater than ₹2,00,000 for being considered for allocation in the Non Institutional Portion. Applicants

are advised to ensure that any single Application from them does not exceed the investment limits or

maximum number of Equity Shares that can be held bythem under applicable law or regulation or as

specified in the Prospectus.

(c.) Multiple Applications: An Applicant should submit only one Application Form. Submissionof a second

Application Form to either the same or to any other Application CollectingIntermediary and duplicate

copies of Application Forms bearing the same application numbershall be treated as multiple applications

and are liable to be rejected.

(d.) Applicants are requested to note the following procedures may be followed by the Registrar tothe Issue to

detect multiple applications:

(i.) All applications may be checked for common PAN as per the records of the Depository. For Applicants

other than Mutual Funds and FPI sub-accounts, Applications bearing the same PAN may be treated as

multiple applications by an Applicant and may be rejected.

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(ii.) For applications from Mutual Funds and FPI sub-accounts, submitted under the same PAN, as well as

Applications on behalf of the PAN Exempted Applicants, the Application Forms maybe checked for

common DP ID and Client ID. In any such applications which have the same DP ID and Client ID,

these may be treated as multiple applications and may be rejected.

(e.) The following applications may not be treated as multiple Applications:

(i.) Applications by Reserved Categories in their respective reservation portion as well as thatmade by

them in the Net Issue portion in public category.

(ii.) Separate applications by Mutual Funds in respect of more than one scheme of the MutualFund

provided that the Applications clearly indicate the scheme for which the Application hasbeen made.

(iii.) Applications by Mutual Funds, and sub-accounts of FPIs (or FPIs and its sub-accounts) submitted with

the same PAN but with different beneficiary account numbers, Client IDs andDP IDs.

1.1.5.Field Number 5: Category of Applicants

(a.) The categories of applicants identified as per the SEBI ICDR Regulations, 2009 for the purpose of

Application, allocation and allotment in the Issue are RIIs, individual applicants other than RII‘s and

other investors (including corporate bodies or institutions, irrespective of the number of specified

securities applied for).

(b.) An Issuer can make reservation for certain categories of Applicants permitted under the SEBI ICDR

Regulations, 2009. For details of any reservations made in the Issue, applicants may refer to the

Prospectus.

(c.) The SEBI ICDR Regulations, 2009 specify the allocation or allotment that may be made to various

categories of applicants in an Issue depending upon compliance with the eligibility conditions. For

details pertaining to allocation and Issue specific details in relation to allocation, applicant may refer to

the Prospectus.

1.1.6.Field Number 6: Investor Status

(a.) Each Applicant should check whether it is eligible to apply under applicable law and ensurethat any

prospective allotment to it in the Issue is in compliance with the investmentrestrictions under

applicable law.

(b.) Certain categories of Applicants, such as NRIs, FPIs and FVCIs may not be allowed to applyin the

Issue or hold Equity Shares exceeding certain limits specified under applicable law.Applicants are

requested to refer to the Prospectus for more details.

(c.) Applicants should check whether they are eligible to apply on non-repatriation basis orrepatriation

basis and should accordingly provide the investor status. Details regardinginvestor status are different

in the Resident Application Form and Non-Resident ApplicationForm.

(d.) Applicants should ensure that their investor status is updated in the Depository records.

1.1.7.Field 7: Payment Details

Please note that, providing bank account details in the space provided in the Application Form is mandatory and

Applications that do not contain such details are liable to be rejected.

1.1.7.1. Payment instructions for Applicants

(a) Applicants may submit the Application Form in physical mode to the Application Collecting

Intermediaries.

(b) Applicants should specify the Bank Account number in the Application Form.

(c) Applicants should ensure that the Application Form is also signed by the ASBA Account holder(s) if

the Applicant is not the ASBA Account holder;

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(d) Applicants shall note that that for the purpose of blocking funds under ASBA facility

clearlydemarcated funds shall be available in the account.

(e) From one Bank Account, a maximum of five Application Forms can be submitted.

(f) Applicants applying directly through the SCSBs should ensure that the Application Form issubmitted

to a Designated Branch of a SCSB where the ASBA Account is maintained. In caseApplicant applying

through Application Collecting Intermediary other than SCSB, afterverification and upload, the

Application Collecting Intermediary shall send to SCSB for blockingof fund.

(g) Upon receipt of the Application Form, the Designated Branch of the SCSB may verify if

sufficientfunds equal to the Application Amount are available in the ASBA Account, as mentioned in

theApplication Form.

(h) If sufficient funds are available in the ASBA Account, the SCSB may block an amount equivalentto the

Application Amount mentioned in the Application Form and may upload the details on theStock

Exchange Platform.

(i) If sufficient funds are not available in the ASBA Account, the Designated Branch of the SCSBmay not

upload such Applications on the Stock Exchange platform and such Applications areliable to be

rejected.

(j) Upon submission of a completed Application Form each ASBA Applicant may be deemed to

haveagreed to block the entire Application Amount and authorized the Designated Branch of the

SCSBto block the Application Amount specified in the Application Form in the ASBA

Accountmaintained with the SCSBs.

(k) The Application Amount may remain blocked in the aforesaid ASBA Account until finalisation ofthe

Basis of allotment and subsequent transfer of the Application Amount against the AllottedEquity

Shares, if any, to the Public Issue Account, or until withdrawal or failure of the Issue, oruntil

withdrawal or rejection of the Application, as the case may be.

(l) SCSBs applying in the Issue must apply through an ASBA Account maintained with any otherSCSB;

else their Applications are liable to be rejected.

1.1.8.Unblocking of ASBA Account

(a) Once the Basis of Allotment is approved by the Designated Stock Exchange, the Registrar to theIssue may

provide the following details to the controlling branches of each SCSB, along withinstructions to unblock

the relevant bank accounts and for successful applications transfer therequisite money to the Public Issue

Account designated for this purpose, within the specifiedtimelines: (i) the number of Equity Shares to be

Allotted against each Application, (ii) the amountto be transferred from the relevant bank account to the

Public Issue Account, for each Application,(iii) the date by which funds referred to in (ii) above may be

transferred to the Public IssueAccount, and (iv) details of rejected/ partial/ non allotment ASBA

Applications, if any, along withreasons for rejection and details of withdrawn or unsuccessful Applications,

if any, to enable theSCSBs to unblock the respective bank accounts.

(b) On the basis of instructions from the Registrar to the Issue, the SCSBs may transfer the requisiteamount

against each successful ASBA Application to the Public Issue Account and may unblockthe excess amount,

if any, in the ASBA Account.

(c) In the event of withdrawal or rejection of the Application Form and for unsuccessful Applications,the

Registrar to the Issue may give instructions to the SCSB to unblock the Application Amount inthe relevant

ASBA Account within 6 Working Days of the Issue Closing Date.

1.1.8.1. Discount (if applicable)

(a) The Discount is stated in absolute rupee terms.

(b) RIIs, Employees and Retail Individual Shareholders are only eligible for discount. For

Discountsoffered in the Issue, applicants may refer to the Prospectus.

(c) The Applicants entitled to the applicable Discount in the Issue may make payment for an amounti.e.

the Application Amount less Discount (if applicable).

1.1.8.2. Additional Payment Instructions for NRIs

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The Non-Resident Indians who intend to block funds in their Non-Resident Ordinary (NRO) accounts shall

use the form meant for Resident Indians (non-repatriation basis). In the case of applications byNRIs

applying on a repatriation basis, payment shall not be accepted out of NRO Account.

1.1.9.Field Number 8: Signatures and other Authorisations

(a) Only the First Applicant is required to sign the Application Form. Applicants should ensure that

signatures are in one of the languages specified in the Eighth Schedule to the Constitution of India.

(b) If the ASBA Account is held by a person or persons other than the Applicant, then the Signature of the

ASBA Account holder(s) is also required.

(c) In relation to the Applications, signature has to be correctly affixed in the authorisation/undertaking

box in the Application Form, or an authorisation has to be provided tothe SCSB via the electronic

mode, for blocking funds in the ASBA Account equivalent to the application amount mentioned in the

Application Form.

(d) Applicants must note that Application Form without signature of Applicant and /or ASBA Account

holder is liable to be rejected.

1.1.10. Acknowledgement and Future Communication

Applicants should ensure that they receive the acknowledgment duly signed and stamped by Application

Collecting Intermediaries, as applicable, for submission of the Application Form.

(a) All communications in connection with Applications made in the Issue should be addressed asunder:

(i.) In case of queries related to Allotment, non-receipt of Allotment Advice, credit of allotted equity

shares, unblocking of funds, the Applicants should contact the Registrar to the Issue.

(ii.) In case of applications submitted to the Designated Branches of the SCSBs, the Applicants should

contact the relevant Designated Branch of the SCSB.

(iii.) Applicant may contact the Company Secretary and Compliance Officer or LM(s) in case of any other

complaints in relation to the Issue.

(b) The following details (as applicable) should be quoted while making any queries -

(i.) Full name of the sole or First Applicant, Application Form number, Applicants DP ID, Client ID, PAN,

number of Equity Shares applied for, amount blocked on application And ASBA Account Number and

Name.

(ii.) In case of ASBA applications, ASBA Account number in which the amount equivalent to the

application amount was blocked.

For further details, Applicant may refer to the Prospectus and the Application Form.

1.2 Instructions for filing the Revision Form

(a) During the Issue Period, any Applicant (other than QIBs and NIIs, who can only revise their

application amount upwards) who has registered his or her interest in the Equity Shares for a particular

number of shares is free to revise number of shares applied using revision forms available separately.

(b) RII may revise/withdraw their applications till closure of the Issue period

(c) Revisions can be made only in the desired number of Equity Shares by using the Revision Form.

(d) The Applicant can make this revision any number of times during the Issue Period. However, for any

revision(s) in the Application, the Applicants will have to use the services of the SCSB through which

such Applicant had placed the original Application.

A sample Revision form is reproduced below:

Other than instructions already highlighted at paragraph 4.1 above, point wise instructions regarding filling up

various fields of the Revision Form are provided below:

275

Revision Form-R

276

1.2.1 Fields 1, 2 and 3: Name and Contact Details of Sole/First Applicant, PAN of Sole/First Applicant &

Depository Account Details of the Applicant

Applicants should refer to instructions contained in paragraphs 4.1.1, 4.1.2 and 4.1.3.

1.2.2 Field 4 & 5: Application Revision ‘From’ and ‘To’

(a) Apart from mentioning the revised number of shares in the Revision Form, the Applicant must also

mention the details of shares applied for given in his or her Application Form or earlier Revision Form.

(b) In case of revision of applications by RIIs, Employees and Retail Individual Shareholders, such

Applicants should ensure that the application amount should exceed ₹2,00,000/- due to revision and the

application may be considered, subject to eligibility, for allocation under the Non-Institutional

Category.

1.2.3 Field 6: Payment Details

(a) All Applicants are required to make payment of the full application amount along with the Revision

Form.

(b) Applicant may Issue instructions to block the revised amount in the ASBA Account, to Designated

Branch through whom such Applicant had placed the original application to enable the relevant SCSB

to block the additional application amount, if any.

1.2.4 Fields 7: Signatures and Acknowledgements

Applicants may refer to instructions contained at paragraphs 4.1.8 and 4.1.9 for this purpose.

1.3 Submission of Revision Form/Application Form

Applicants may submit completed application form / Revision Form in the following manner:

Mode of Application

Form

Submission of Application Form

All Investors Application To the Application Collecting Intermediaries as mentioned in the

Prospectus/ Application Form

SECTION-5: ISSUE PROCEDURE IN FIXED PRICE ISSUE

1. Applicants may note that there is no Bid cum Application Form in a Fixed Price Issue

As the Issue Price is mentioned in the Fixed Price Issue therefore on filing of the Prospectus with the RoC, the

Application so submitted is considered as the application form.

Applicants may only use the specified Application Form for the purpose of making an Application in terms of

the Prospectus which may be submitted through Application Collecting Intermediaries and apply only through

ASBA facility.

ASBA Applicants may submit an Application Form either in physical/electronic form to the Application

Collecting Intermediaries authorising blocking of funds that are available in the bank account specified in the

Application Form only (‘ASBA Account’). The Application Form is also made available on the websites of the

Stock Exchanges at least one day prior to the Issue Opening Date.

In a fixed price Issue, allocation in the net offer to the public category is made as follows: minimum fifty per

cent to Retail Individual Investors; and remaining to (i) individual investors other than Retail Individual

Investors; and (ii) other Applicants including corporate bodies or institutions, irrespective of the number of

specified securities applied for. The unsubscribed portion in either of the categories specified above may be

allocated to the Applicants in the other category.

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2. Grounds of Rejections

Applicants are advised to note that Applications are liable to be rejected inter alia on the followingtechnical

grounds:

Amount blocked does not tally with the amount payable for the Equity Shares applied for;

In case of partnership firms, Equity Shares may be registered in the names of the individual partners and no

firm as such shall be entitled to apply;

Application by persons not competent to contract under the Indian Contract Act, 1872 (other than minor

having valid depository accounts as per demographic details provided by the depositary);

PAN not mentioned in the Application Form;

GIR number furnished instead of PAN;

Applications for lower number of Equity Shares than specified for that category of investors;

Applications at a price other than the Fixed Price of the Issue;

Applications for number of Equity Shares which are not in multiples of 3,000;

Category not ticked;

Multiple Applications as defined in the Prospectus;

In case of Application under power of attorney or by limited companies, corporate, trust etc.,where relevant

documents are not submitted;

Applications accompanied by Stock invest/ money order/ postal order/ cash/ cheque/ demand draft/ pay

order;

Signature of sole Applicant is missing;

Application Forms are not delivered by the Applicant within the time prescribed as per theApplication

Forms, Issue Opening Date advertisement and the Prospectus and as per theinstructions in the Prospectus

and the Application Forms;

In case no corresponding record is available with the Depositories that matches threeparameters namely,

names of the Applicants (including the order of names of joint holders),the Depository Participant‘s identity

(DP ID) and the beneficiary‘s account number;Applications for amounts greater than the maximum

permissible amounts prescribed by theregulations;

Applications by OCBs;

Applications by US persons other than in reliance on Regulation S or ‘Qualified Institutional Buyers’ as

defined in Rule 144A under the Securities Act;

Applications not duly signed by the sole/ first Applicant;

Applications by any persons outside India if not in compliance with applicable foreign andIndian laws;

Applications that do not comply with the securities laws of their respective jurisdictions areliable to be

rejected;

Applications by persons prohibited from buying, selling or dealing in the shares directly orindirectly by

SEBI or any other regulatory authority;

Applications by persons who are not eligible to acquire Equity Shares of the Company interms of all

applicable laws, rules, regulations, guidelines, and approvals;

Applications or revisions thereof by QIB Applicants, Non Institutional Applicants where theApplication

Amount is in excess of ₹2,00,000, received after 3.00 p.m. on the Issue ClosingDate , unless the extended

time is permitted by NSE.

Details of ASBA Account not provided in the Application form

For details of instructions in relation to the Application Form, Applicants may refer to therelevant section the

GID.

APPLICANTS SHOULD NOTE THAT IN CASE THE PAN, THE DP ID AND CLIENT ID

MENTIONED IN THE APPLICATION FORM AND ENTERED INTO THE ELECTRONIC

APPLICATION SYSTEM OF THE STOCK EXCHANGES BY THE APPLICATION COLLECTING

INTERMEDIARIES DO NOT MATCH WITH PAN, THE DP ID AND CLIENT ID AVAILABLE IN

THE DEPOSITORY DATABASE, THE APPLICATION FORM IS LIABLE TO BE REJECTED.

SECTION-6: ISSUE PROCEDURE IN BOOK BUILT ISSUE

This being Fixed Price Issue, this section is not applicable for this Issue.

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SECTION 7: ALLOTMENT PROCEDURE AND BASIS OF ALLOTMENT

7.1. BASIS OF ALLOTMENT

Allotment will be made in consultation with NSE (The Designated Stock Exchange). In the event of

oversubscription, the allotment will be made on a proportionate basis in marketable lots as set forth hereunder:

(a.) The total number of Shares to be allocated to each category as a whole shall be arrived at on a proportionate

basis i.e. the total number of Shares applied for in that category multiplied by the inverse of the over

subscription ratio (number of Applicants in the category x number of Shares applied for).

(b.) The number of Shares to be allocated to the successful Applicants will be arrived at on a proportionate basis

in marketable lots (i.e. Total number of Shares applied for into the inverse of the over subscription ratio).

(c.) For applications where the proportionate allotment works out to less than 2,000 equity shares the allotment

will be made as follows:

(i.) Each successful Applicant shall be allotted 2,000 equity shares; and

(ii.) The successful Applicants out of the total applicants for that category shall be determined by the drawl

of lots in such a manner that the total number of Shares allotted in that category is equal to the number

of Shares worked out as per (2) above.

(d.) If the proportionate allotment to an Applicant works out to a number that is not a multiple of 2,000 equity

shares, the Applicant would be allotted Shares by rounding off to the nearest multiple of 2,000 equity shares

subject to a minimum allotment of 2,000 equity shares.

(e.) If the Shares allotted on a proportionate basis to any category is more than the Shares allotted to the

Applicants in that category, the balance available Shares or allocation shall be first adjusted against any

category, where the allotted Shares are not sufficient for proportionate allotment to the successful

Applicants in that category, the balance Shares, if any, remaining after such adjustment will be added to the

category comprising Applicants applying for the minimum number of Shares. If as a result of the process of

rounding off to the nearest multiple of 2,000 Equity Shares, results in the actual allotment being higher than

the shares offered, the final allotment may be higher at the sole discretion of the Board of Directors, upto

110% of the size of the offer specified under the Capital Structure mentioned in this Prospectus.

(f.) The above proportionate allotment of Shares in an Issue that is oversubscribed shall be subject to the

reservation for Retail individual Applicants as described below:

(i.) As per Regulation 43 (4) of SEBI (ICDR), as the retail individual investor category is entitled to more

than fifty per cent on proportionate basis, the retail individual investors shall be allocated that higher

percentage.

(ii.) The balance net offer of shares to the public shall be made available for allotment to

• Individual applicants other than retails individual investors and

• Other investors, including corporate bodies/ institutions irrespective of number of shares applied for.

(iii.) The unsubscribed portion of the net offer to any one of the categories specified in a) or b)shall/may be

made available for allocation to applicants in the other category, if so required.

'Retail Individual Investor' means an investor who applies for shares of value of not more than ₹2,00,000.

Investors may note that in case of over subscription allotment shall be on proportionate basis and will be

finalized in consultation with NSE.

The Executive Director / Managing Director of NSE-the Designated Stock Exchange in addition to Lead

Manager and Registrar to the Public Issue shall be responsible to ensure that the basis of allotment is finalized in

a fair and proper manner in accordance with the SEBI (ICDR)Regulations.

7.2. Designated Date and Allotment of Equity Shares

(a.) Designated Date: On the Designated Date, the SCSBs shall transfer the funds represented by allocation

of Equity Shares into the Public Issue Account with the Bankers to the Issue.

(b.) Issuance of Allotment Advice: Upon approval of the Basis of Allotment by the Designated Stock

Exchange, the Registrar shall upload the same on its website. On the basis of the approved Basis of

Allotment, the Issuer shall pass necessary corporate action to facilitate the Allotment and credit of

Equity Shares. Applicants are advised to instruct their Depository Participant to accept the Equity

Shares that may be allotted to them pursuant to the Issue.

279

Pursuant to confirmation of such corporate actions, the Registrar will dispatch Allotment Advice to the

Applicants who have been Allotted Equity Shares in the Issue.

(c.) The dispatch of Allotment Advice shall be deemed a valid, binding and irrevocable contract.

(d.) Issuer will ensure that: (i) the Allotment of Equity Shares; and (ii) initiate corporate action for credit of

shares to the successful Applicants Depository Account will be completed within 4 Working Days of

the Issue Closing Date. The Issuer also ensures the credit of shares to the successful Applicant‘s

depository account is completed within one Working Day from the date of Allotment, after the funds

are transferred from the Public Issue Account on the Designated Date.

SECTION 8: INTEREST AND REFUNDS

8.1 Completion of Formalities for Listing & Commencement of Trading

The Issuer may ensure that all steps for the completion of the necessary formalities for listing and

commencement of trading at all the Stock Exchanges are taken within 5 Working Days of the Issue Closing

Date. The Registrar to the Issue may give instructions for credit to Equity Shares the beneficiary account with

DPs, and dispatch the Allotment Advice within 5 Working Days of the Issue Closing Date.

8.2 Grounds for Refund

8.2.1 Non Receipt of Listing Permission

An Issuer makes an application to the Stock Exchange(s) for permission to deal in/list and for an official

quotation of the Equity Shares. All the Stock Exchanges from where such permission is sought are disclosed in

Prospectus. The Designated Stock Exchange may be as disclosed in the Prospectus with which the Basis of

Allotment may be finalised.

If the permissions to deal in and for an official quotation of the Equity Shares are not granted by any of the

Stock Exchange(s), the Issuer may forthwith repay, without interest, all moneys received from the Applicants in

pursuance of the Prospectus.

If such money is not repaid within eight days after the Issuer becomes liable to repay it, then the Issuer and

every director of the Issuer who is an officer in default may, on and from such expiry of eight days, be liable to

repay the money, with interest at such rate, as prescribed under Section 73 of the Companies Act, and as

disclosed in the Prospectus.

8.2.2 Minimum Subscription

This Issue is not restricted to any minimum subscription level. This Issue is 100% underwritten. As per Section

39 of the Companies Act, 2013, if the ―stated minimum amount‖ has not be subscribed and the sum payable on

application is not received within a period of 30 days from the date of the Prospectus, the application money has

to be returned within such period as may be prescribed. If the Issuer does not receive the subscription of 100%

of the Issue through this offer document including devolvement of Underwriters within sixty days from the date

of closure of the Issue, the Issuer shall forthwith refund the entire subscription amount received. If there is a

delay beyond eight days after the Issuer becomes liable to pay the amount, the Issuer shall pay interest at a rate

prescribed under section 73 of the Companies Act, 1956 (or the Company shall follow any other substitution or

additional provisions as has been or may be notified under the Companies Act, 2013).

8.2.3 Minimum Number of Allottees

The Issuer may ensure that the number of prospective Allottees to whom Equity Shares may be allotted may not

be less than 50 failing which the entire application monies may be refunded forthwith.

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8.3 Mode of Refund

Within 6 Working Days of the Issue Closing Date, the Registrar to the Issue may give instructions to SCSBs for

unblocking the amount in ASBA Account on unsuccessful Application and also for any excess amount blocked

on Application.

8.3.1 Mode of making refunds

The Registrar to the Issue may instruct the controlling branch of the SCSB to unblock the funds in the relevant

ASBA Account for any withdrawn, rejected or unsuccessful ASBA applications or in the event of withdrawal or

failure of the Issue.

8.4 Interest in Case of Delay in Allotment or Refund

The Issuer may pay interest at the rate of 15% per annum /or demat credits are not made to Applicants or

instructions for unblocking of funds in the ASBA Account are not done within the 4 Working days of the Issue

Closing Date.

The Issuer may pay interest at 15% per annum for any delay beyond 6 days from the Issue Closing Date, if

Allotment is not made.

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SECTION 9: GLOSSARY AND ABBREVIATIONS

Unless the context otherwise indicates or implies, certain definitions and abbreviations used in this document

may have the meaning as provided below. References to any legislation, act or regulation may be to such

legislation, act or Regulation as amended from time to time.

Term(s) Description

Allocation/Allocation of

Equity Shares

The Allocation of Equity Shares of our Company pursuant to Fresh Issue of

Equity Shares to the successful Applicants

Allotment/Allot/Allotted Issue an allotment of Equity Shares of our Company pursuant to Fresh Issue of

the Equity Shares to the successful Applicants

Allottee(s) Successful Applicants to whom Equity Shares of our Company shall have been

allotted

Applicant Any prospective investor who makes an application for Equity Shares of our

Company in terms of this Draft Prospectus

Application Amount The amount at which the Applicant makes an application for Equity Shares of

our Company in terms of this Draft Prospectus

Application Form The Form in terms of which the prospective investors shall apply for our Equity

Shares in the Issue

Application Supported by

Blocked Amount/ASBA

The application (whether physical or electronic) by an Applicant to make an

Application authorizing the relevant SCSB to block the Application Amount in

the relevant ASBA Account Pursuant to SEBI Circular dated November 10,

2015 and bearing Reference No. CIR/CFD/POLICYCELL/11/2015 which shall

be applicable for all public issues opening on or after January 01, 2016, all

potential investors shall participate in the Issue only through ASBA process

providing details about the bank account which will be blocked by the SCSBs

ASBA Account Account maintained with an SCSB and specified in the Application Form which

will be blocked by such SCSB to the extent of the appropriate Application

Amount in relation to an Application by an Applicant

ASBA Application

Location(s)/Specified Cities

Locations at which ASBA Applications can be uploaded by the SCSBs viz,

Mumbai, New Delhi, Chennai, Kolkata, Ahmedabad, Rajkot, Bangalore,

Hyderabad, Pune, Baroda and Surat

ASBA Bid A Bid made by an ASBA Bidder

ASBA Investor/ASBA

Applicant

Any prospective investor(s)/applicants(s) in this Issue who apply(ies) through

the ASBA process in terms of this Draft Prospectus

Banker(s) to the

Issue/Escrow Collection

Bank

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

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

[•] Basis of Allotment The basis on which Equity Shares will be Allotted to the successful Applicants

under the Issue and which is described under chapter titled “Issue Procedure”


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

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

Bid/Issue Period by the Anchor Investors, to subscribe to or purchase the Equity

Shares of our Company at a price within the Price Band, including all revisions

and modifications thereto as permitted under the SEBI Regulations

Bid Amount Highest value of optional Bids indicated in the Bid cum Application Form and

payable by the Bidder upon submission of the Bid

Bid Lot 2000 Equity Shares

Broker Centers Broker centers notified by the Stock Exchanges where Bidders can submit the

Application Forms to a Registered Broker. The details of such Broker Centers,

along with the names and contact details of the Registered Brokers are available

on the websites of the Stock Exchange.

Broker to the Issue All recognized members of the stock exchange would be eligible to act as the

Broker to the Issue

CAN/Allotment advice The note or advice or intimation of Allotment, sent to each successful Applicant

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

Allotment by the Designated Stock Exchange

Client ID Client identification number of the Applicant’s beneficiary account

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Term(s) Description

Collecting Depository

Participant/ CDP

A depository participant as defined under the Depositories Act, 1996, registered

with SEBI and who is eligible to procure Applications at the Designated CDP

Locations in terms of circular no. CIR/CFD/POLICYCELL/11/2015 dated

November 10, 2015 issued by SEBI

Controlling Branches of the

SCSBs

Such branches of the SCSBs which co-ordinate applications under this Issue by

the ASBA Applicants with the Lead Manager, Registrar to the Issue and the

Stock Exchange and a list of which is available at http://www.sebi.gov.in, or at


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

occupation and bank account details

Depository A Depository registered with SEBI under SEBI (Depositories and Participant)

Regulations, 1996

Depository Participant/DP A Depository Participant as defined under the Depositories Act.

Designated CDP Locations Such locations of the CDPs where Applicants can submit the Application Forms

to Collecting Depository Participants. The details of such Designated CDP

Locations, along with names and contact details of the Collecting Depository

Participants eligible to accept Application Forms are available on the website of

the Stock Exchange i.e. www.nseindia.com

Designated SCSB Branches Such branches of the SCSBs which shall collect the ASBA Forms from the

ASBA Applicants and a list of which is available at www.sebi.gov.in, or at such

other website as may be prescribed by SEBI from time to time

Designated Date The date on which funds are transferred from the amount blocked by the SCSBs

is transferred from the ASBA Account to the Public Issue Account, as

appropriate, after the Issue is closed, following which the Equity Shares shall be

allotted/transfer to the successful Applicants

Designated

Intermediaries/Collecting

Agent

An SCSB with whom the bank account to be blocked, is maintained, a syndicate

member (or sub-syndicate member), a Registered Broker, Designated CDP

Locations for CDP, a registrar to an issue and Share Transfer Agent (RTA)

(whose names is mentioned on website of the Stock Exchange as eligible for this

activity)

Designated Market Maker/

Market Maker

In our case, [●] having its Registered office at [●] and Corporate office at [●]

Designated RTA Locations Such locations of the RTAs where Applicants can submit the Application Forms

to RTAs. The details of such Designated RTA Locations, along with names and

contact details of the RTAs eligible to accept Application Forms are available on

the website of the Stock Exchange, i.e. www.nseindia.com

Designated Stock Exchange National Stock Exchange of India Limited

Draft Prospectus The Draft Prospectus dated September 03, 2018 issued in accordance with

Section 26 of the Companies Act, 2013 and filed with the NSE under SEBI

(ICDR) Regulations, 2009

Eligible NRIs NRIs from jurisdictions outside India where it is not unlawful to make an issue

or invitation under the Issue and in relation to whom this Draft Prospectus

constitutes an invitation to subscribe to the Equity Shares offered herein

Eligible QFIs Qualified Foreign Investors from such jurisdictions outside India where it is not

unlawful to make an offer or invitation under the Issue and in relation to whom

the Prospectus constitutes an invitation to purchase the Equity Shares offered

thereby and who have opened dematerialized accounts with SEBI registered

qualified depositary participants as QFIs and are deemed as FPIs under the SEBI

(Foreign Portfolio Investors) Regulations, 2014

Public Issue Account(s) Account(s) opened with the Public Issue Bank/Banker to the Issue for the Issue

Public Issue Account

Agreement

Agreement entered into by our Company, the Registrar to the Issue, the Lead

Manager, and the Public Issue Bank/Banker to the Issue for collection of the

Application Amounts

First/Sole Applicant The Applicant whose name appears first in the Application Form or Revision

Form

General Information

Document/GID

The General Information Document for investing in public issues prepared and

issued in accordance with the circulars (CIR/CFD/DIL/12/ 2013) dated October

23, 2013, notified by SEBI and updated pursuant to the circular


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Term(s) Description

(CIR/CFD/POLICYCELL/11/2015) dated November 10, 2015 and

(SEBI/HO/CFD/DIL/CIR/P/2016/26) dated January 21, 2016 notified by the

SEBI and included in “Issue Procedure” on page 246 of this Draft Prospectus

Issue/Issue Size/ Initial

Public Issue/ Initial Public

Offer/ Initial Public

Offering/Initial Public

Offering/ IPO

Public Issue of 24,00,000 Equity Shares of face value of ₹ 10 each fully paid of

Preet Remedies Limited for cash at a price of ₹51 per Equity Share (including a

premium of ₹41 per Equity Share) aggregating ₹1224 Lakhs

Memorandum of

Understanding/MoU

The agreement dated July, 28 2018 between our Company and the Lead

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

Issue

Issue Opening Date The date on which Issue opens for subscription

Issue Closing Date The date on which Issue closes for subscription

Issue Period The period between the Issue Opening Date and the Issue Closing Date inclusive

of both the days during which prospective Investors may submit their

application.

Issue Price The price at which the Equity Shares are being issued by our Company under

this Draft Prospectus being ₹51 per Equity Share of face value of ₹10 each fully

paid

Issue Proceeds Proceeds from the fresh Issue that will be available to our Company, being ₹

1224.00 Lakhs

Listing Agreement The Equity Listing Agreement to be signed between our Company and the

National Stock Exchange of India Limited.

Lead Manager Manager to the Issue, in this case being Mark Corporate Advisors Private

Limited, a SEBI Registered Merchant Banker

Market Maker Market Maker appointed by our Company, in this case being [●] who has agreed

to receive or deliver the specified securities in the market making process for a

period of three years from the date of listing of our Equity Shares or for any

other period as may be notified by SEBI from time to time

Market Making Agreement Market Making Agreement dated [●] between Our Company, Lead Manager and

the Market Maker

Market Maker Reservation

Portion

The Reserved Portion of 1,20,000 Equity Shares of face value of ₹10 each fully

paid for cash at a price of ₹51 per Equity Share aggregating ₹61.20 Lakhs for the

Market Maker in this Issue

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

Regulations, 1996, as amended from time to time

Net Issue The Issue excluding the Market Maker Reservation Portion of 22,80,000 Equity

Shares of face value of ₹10 each fully paid for cash at a price of ₹ 51 Equity

Share aggregating ₹ 1162.80 Lakhs by our Company

Net Proceeds The Issue Proceeds, less the Issue related expenses, received by the Company.

For further information about use of the Issue Proceeds and the Issue expenses,

please refer to the chapter titled “Objects of the Issue” beginning on Page No. 73

of this Draft Prospectus

Non-Institutional Investors All Applicants that are not Qualified Institutional Buyers or Retail Individual

Investors and who have Applied for Equity Shares for an amount more than

₹2,00,000

OCB/Overseas Corporate

Body

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




(Deposit) Regulations, 2000, as amended from time to time. OCBs are not

allowed to invest in this Issue

Payment through electronic

transfer of funds

Payment through NECS, NEFT or Direct Credit, as applicable

Person/Persons Any individual, sole proprietorship, unincorporated association, unincorporated

organization, body corporate, corporation, company, partnership, limited liability

company, joint venture, or trust or any other entity or organization validly

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Term(s) Description

constituted and/or incorporated in the jurisdiction in which it exists and operates,

as the context requires

Prospectus The Prospectus to be filed with RoC containing, inter-alia, the issue opening and

closing dates and other information

Public Issue Account Account opened with the Banker to the Issue/Public Issue Bank i.e. [●] by our

Company to receive monies from SCSBs from the bank accounts of the ASBA

Applicants on the Designated Date

Qualified Institutional

Buyers or QIBs

QIBs, as defined under the SEBI ICDR Regulations, including public financial

institutions as specified in Section 2 (72) of the Companies Act, 2013 scheduled

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

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

with SEBI, multilateral and bilateral development financial institution, venture

capital fund registered with SEBI, foreign venture capital investor registered

with SEBI, state industrial development corporation, insurance company

registered with Insurance Regulatory and Development Authority, provident

fund with minimum corpus of ₹2,500 Lakhs, pension fund with minimum corpus

of ₹2,500 Lakhs, NIF, insurance funds set up and managed by army, navy or air

force of the Union of India and insurance funds set up and managed by the

Department of Posts, India

Refund Account (s) Account(s) to which monies to be refunded to the Applicants shall be transferred

from the Public Issue Account in case listing of the Equity Shares does not occur

Refund Bank(s)/Refund

Banker(s)

Bank(s) which is / are clearing member(s) and registered with the SEBI as

Bankers to the Issue at which the Refund Accounts will be opened in case listing

of the Equity Shares does not occur, in this case being [●] Bank Limited

Registered Brokers Stock Brokers registered with the Stock Exchanges having nationwide terminals

Registrar/Registrar to the

Issue

Bigshare Services Private Limited having Registered Office at 1st Floor, Bharat

Tin Works Building, Opp. Vasant Oasis, Makhwana Road, Marol, Andheri (E),

Mumbai-400 059

Retail Individual Investor Individual Applicants, or minors applying through their natural guardians,

including HUFs (applying through their Karta) and ASBA Applicants, who

apply for an amount less than or equal to ₹2,00,000

Revision Form The /form used by the Applicants to modify the quantity of Equity Shares in any

of their Application Forms or any previous Revision Form(s)

Self-Certified Syndicate

Banker/ SCSB

Shall mean a Banker to an Issue registered under SEBI (Bankers to an Issue)

Regulations, 1994, as amended from time to time, and which offer the service of

making Application/s Supported by Blocked Amount including blocking of bank

account and a list of which is available on www.sebi.gov.in or at such other

website as may be prescribed by SEBI from time to time

SME Platform of NSE/SME

Exchange/NSE EMERGE

The SME Platform of NSE for listing of equity shares offered under Chapter XB

of the SEBI (ICDR) Regulations

Underwriters Mark Corporate Advisors Private Limited

Underwriting Agreement The agreement dated [●] entered into between the Underwriter(s) and our

Company

Working Day “Working Day” means all days, other than second and fourth Saturday of the

month, Sunday or a public holiday, on which commercial banks in Mumbai are

open for business; provided however, with reference to Issue Period, “Working

Day” shall mean all days, excluding all Saturdays, Sundays or a public holiday,

on which commercial banks in Mumbai are open for business; and with

reference to the time period between the Issue Closing Date and the listing of the

Equity Shares on the SME Exchange of National Stock Exchange of India

Limited, “Working Day” shall mean all trading days of National Stock Exchange

of India Limited, excluding Sundays and bank holidays, as per the SEBI Circular

SEBI/HO/CFD/DIL/CIR/P/2016/26 dated January 21, 2016

RESTRICTION ON FOREIGN OWNERSHIP OF INDIAN SECURITIES

Foreign investment in Indian securities is regulated through the Industrial Policy, 1991 of the Government of

India and FEMA. While the Industrial Policy, 1991 prescribes the limits and the conditions subject to which

foreign investment can be made in different sectors of the Indian economy, FEMA regulates the precise manner

in which such investment may be made. Under the Industrial Policy, unless specifically restricted, foreign

investment is freely permitted in all sectors of Indian economy up to any extent and without any prior approvals,

but the foreign investor is required to follow certain prescribed procedures for making such investment. Foreign

investment is allowed up to 26% under automatic route in our Company. India’s current Foreign Direct

Investment (“FDI”) Policy issued by the Department of Industrial Policy and Promotion, Ministry of Commerce

and Industry, GoI (“DIPP”) by circular of 2016 with effect from June 07, 2016 (“Circular of 2016”),

consolidates and supersedes all previous press notes, press releases and clarifications on FDI issued by the

DIPP. The Government usually updates the consolidated circular on FDI Policy once every Year and therefore,

this circular of 2016 will be valid until the DIPP issues an updated circular.

The Government of India, from time to time, has made policy pronouncements on Foreign Direct Investment

(“FDI”) through press notes and press releases. The Department of Industrial Policy and Promotion, Ministry

of Commerce and Industry, Government of India (“DIPP”), has issued consolidated FDI Policy Circular of

2016 (“FDI Policy 2016”), which with effect from June 7, 2016, consolidates and supersedes all previous

press notes, press releases and clarifications on FDI Policy issued by the DIPP that were in force. Further,

DIPP has issued Press note 5, dated June 24, 2016 which introduces few changes in FDI Policy 2016. The

Government proposes to update the consolidated circular on FDI policy once every year and therefore, FDI

Policy 2016 will be valid until the DIPP issues an updated circular.

The Reserve Bank of India (“RBI”) also issues Master Circular on Foreign Investment in India every year.

Presently, FDI in India is being governed by Master Circular on Foreign Investment dated July 01, 2015 as

updated from time to time by RBI. In terms of the Master Circular, an Indian company may issue fresh shares

to people resident outside India (who is eligible to make investments in India, for which eligibility criteria are

as prescribed). Such fresh issue of shares shall be subject to inter-alia, the pricing guidelines prescribed under

the Master Circular. The Indian company making such fresh issue of shares would be subject to the reporting

requirements, inter-alia with respect to consideration for issue of shares and also subject to making certain

filings including filing of Form FC-GPR.

The transfer of shares between an Indian resident and a non-resident does not require the prior approval of the

FIPB or the RBI, subject to fulfilment of certain conditions as specified by DIPP/RBI, from time to time.

Such conditions include (i) the activities of the investee company are under the automatic route under the FDI

Policy and transfer does not attract the provisions of the Takeover Regulations; (ii) the non-resident

shareholding is within the sectoral limits under the FDI Policy; and

(iii) the pricing is in accordance with the guidelines prescribed by the SEBI/ RBI. As per the existing policy

of the Government of India, OCBs cannot participate in this Issue and in accordance with the extant FDI

guidelines on sectoral caps, pricing guidelines etc. as amended by Reserve bank of India, from time to time.

Investors are advised to confirm their eligibility under the relevant laws before investing and / or subsequent

purchase or sale transaction in the Equity Shares of Our Company. Investors will not offer, sell, pledge or

transfer the Equity Shares of our Company to any person who is not eligible under applicable laws, rules,

regulations, guidelines. Our Company, the Underwriters and their respective directors, officers, agents,

affiliates and representatives, as applicable, accept no responsibility or liability for advising any investor on

whether such investor is eligible to acquire Equity Shares of our Company.

Investment conditions/restrictions for overseas entities

Under the current FDI Policy 2016, the maximum amount of Investment (sectoral cap) by foreign investor in

an issuing entity is composite unless it is explicitly provided otherwise including all types of foreign

investments, direct and indirect, regardless of whether it has been made for FDI, FII, FPI, NRI, FVCI, LLPs,

DRs and Investment Vehicles under Schedule 1, 2, 2A, 3, 6, 9, 10 and 11 of FEMA (Transfer or Issue of

Security by Persons Resident outside India) Regulations. Any equity holding by a person resident outside

India resulting from conversion of any debt instrument under any arrangement shall be reckoned as foreign

investment under the composite cap.

Portfolio Investment upto aggregate foreign investment level of 74% or sectoral/statutory cap, whichever is

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lower, will not be subject to either Government approval or compliance of sectoral conditions, if such

investment does not result in transfer of ownership and/or control of Indian entities from resident Indian

citizens to non-resident entities. Other foreign investments will be subject to conditions of Government

approval and compliance of sectoral conditions as per FDI Policy. The total foreign investment, direct and

indirect, in the issuing entity will not exceed the sectoral/statutory cap.

i. Investment by FIIs under Portfolio Investment Scheme (PIS):

With regards to purchase/sale of share/convertible debentures by a registered FII under PIS the total

holding by each FII/SEBI approved sub-account of FII shall not exceed 10 % of the total paid-up

equity capital or 10% of the paid-up value of each series of convertible debentures issued by an Indian

company and the total holdings of all FIIs/sub-accounts of FIIs put together shall not exceed 24 %of

paid-up equity capital or paid-up value of each series of convertible debentures. However, this limit of

24 % may be increased up to sectoral cap/statutory ceiling, as applicable, by the Indian company

concerned by passing a resolution by its Board of Directors followed by passing of a special resolution

to that effect by its general body. For arriving at the ceiling on holdings of FIIs, shares/ convertible

debentures acquired both through primary as well as secondary market will be included. However, the

ceiling will not include investment made by FII through off-shore Funds, Global Depository receipts

and Euro-Convertible Bonds. With regard to convertible debentures, these investments permitted to be

made shall not exceed 5 % of the total paid-up equity capital or 5% of the paid-up value of each series

of convertible debentures issued by an Indian Company, and shall also not exceed the over-all ceiling

limit of 24 % of paid-up equity capital or paid up value of each series of convertible debentures.

ii. Investment by Registered Foreign Portfolio Investor (RFPI) under Foreign Portfolio Investment

(FPI) Scheme

With respect to purchase/sale of shares or convertible debentures or warrants, a RFPI registered in

accordance with SEBI (FPI) Regulations, 2014 as amended in regular intervals may purchase shares or

convertible debentures or warrants of an Indian company under FPI scheme. The total holding by each

RFPI shall be below 10 % of the total paid-up equity capital or 10 % of the paid-up value of each

series of convertible debentures issued by an Indian company and the total holdings of all RFPI put

together shall not exceed 24 % of paid- up equity capital or paid up value of each series of convertible

debentures. The said limit of 24 % will be called aggregate limit. However, the aggregate limit of 24 %

may be increased up to the sectoral cap/statutory ceiling, as applicable, by the Indian company

concerned by passing a resolution by its Board of Directors followed by passing of a special resolution

to that effect by its General Body. For arriving at the ceiling on holdings of RFPI, shares or convertible

debentures or warrants acquired both through primary as well as secondary market will be included.

However, the ceiling will exclude investment made by RFPI through of off-shore Funds, Global

Depository Receipts and Euro-Convertible Bonds but include holding of RFPI and deemed RFPI in the

investee company for computation of 24 % or enhanced limit.

iii. Investment by NRI on repatriation and non-repatriation basis under PIS:

With respect to purchase/sale of shares and/or convertible debentures by a NRI on a stock exchange in

India on repatriation and/or non-repatriation basis under PIS is allowed subject to certain conditions

under Schedule 3 of the FEMA (Transfer or Issue of security by a person resident outside India)

Regulations, 2000. Further, with regard to limits:

- the paid-up value of shares of an Indian company, purchased by each NRI both on

repatriation and on non-repatriation basis, does not exceed 5 % of the paid-up value of shares

issued by the company concerned;

- the paid-up value of each series of convertible debentures purchased by each NRI both on

repatriation and non-repatriation basis does not exceed 5 % of the paid-up value of each

series of convertible debentures issued by the company concerned;

- the aggregate paid-up value of shares of any company purchased by all NRIs does not exceed

10 % of the paid up capital of the company and in the case of purchase of convertible

debentures

- the aggregate paid-up value of each series of debentures purchased by all NRIs does not

exceed 10 % of the paid-up value of each series of convertible debentures;

However, the aggregate ceiling of 10 % may be raised to 24 % if a special resolution to that

effect is passed by the General Body of the Indian company concerned.

iv. Investment by NRI on Non-repatriation basis

As per current FDI Policy 2016, schedule 4 of FEMA (Transfer or Issue of Security by Persons

Resident outside India) Regulations – Purchase and sale of shares and convertible debentures or

warrants by a NRI on Non-repatriation basis – will be deemed to be domestic investment at par with

287

the investment made by residents. This is further subject to remittance channel restrictions.

The Equity Shares have not been and will not be registered under the U.S. Securities Act of 1933, as

amended (“US Securities Act”) or any other state securities laws in the United States of America and may

not be sold or offered within the United States of America, or to, or for the account or benefit of “US

Persons” as defined in Regulation S of the U.S. Securities Act), except pursuant to exemption from, or in

a transaction not subject to, the registration requirements of US Securities Act and applicable state

securities laws.

Accordingly, the equity shares are being offered and sold only outside the United States of America in

an offshore transaction in reliance upon Regulation S under the US Securities Act and the applicable

laws of the jurisdiction where those offers and sale occur.

Further, no offer to the public (as defined under Directive 20003/71/EC, together with any

amendments) and implementing measures thereto, (the “Prospectus Directive”) has been or will be

made in respect of the Issue in any member State of the European Economic Area which has

implemented the Prospectus Directive except for any such offer made under exemptions available

under the Prospectus Directive, provided that no such offer shall result in a requirement to publish or

supplement a prospectus pursuant to the Prospectus Directive, in respect of the Issue.

Any forwarding, distribution or reproduction of this document in whole or in part may be

unauthorised. Failure to comply with this directive may result in a violation of the Securities Act or the

applicable laws of other jurisdictions. Any investment decision should be made on the basis of the final

terms and conditions and the information contained in this Draft Prospectus.

The Equity Shares have not been and will not be registered, listed or otherwise qualified in any other

jurisdiction outside India and may not be offered or sold, and Application may not be made by persons in any

such jurisdiction, except in compliance with the applicable laws of such jurisdiction.

The above information is given for the benefit of the Applicants. Our Company and the Lead Manager are not

liable for any amendments or modification or changes in applicable laws or regulations, which may occur

after the date of this Draft Prospectus. Applicants are advised to make their independent investigations and

ensure that the Applications are not in violation of laws or regulations applicable to them and do not exceed

the applicable limits under the laws and regulations.

288

SECTION IX – DESCRIPTION OF EQUITY SHARES AND TERMS OF THE ARTICLE OF

ASSOCIATION MAIN PROVISIONS OF ARTICLES OF ASSOCIATION

The following regulations comprised in these Articles of Association were adopted pursuant to members’

resolution passed at the Extra Ordinary general meeting of the Company held on 27th January, 2018 in

substitution for, and to the entire exclusion of, the earlier regulations comprised in the extant Articles of

Association of the Company.

Article No. Interpretation Heading

1. (1) The regulations contained in the Table marked ‘F’ in Schedule I to

the Companies Act, 2013 shall not apply to the Company,

except in so far as the same are repeated, contained or expressly made

applicable in these Articles or by the said Act.

Table ‘F’ not to

Apply

(2) The regulations for the management of the Company and for the

observance by the members thereto and their representatives, shall,

subject to any exercise of the statutory powers of the Company with

reference to the deletion or alteration of or addition to its regulations

by resolution as prescribed or permitted by the Companies Act,

2013, be such as are contained in these Articles.

Company to be

governed by

these Articles

Interpretation

2. (1) In these Articles —

(a) “Act” means the Companies Act, 2013 or any

statutory modification or re-enactment thereof for the time

being in force and the term shall be deemed to refer to the

applicable section thereof which is relatable to the relevant

Article in which the said term appears in these Articles and any

previous company law, so far as may be applicable.

“Act”

(b) “Articles” means these articles of association of the Company

or as altered from time to time. “Articles”

(c) “Board of Directors” or “Board”, means the collective body of

the directors of the Company. “Board of

Directors” or

“Board”

(d) “Company” means Preet Remedies Limited. “Company”

(e) “Rules” means the applicable rules for the time being in

force as prescribed under relevant sections of the Act. “Rules”

(f) “seal” means the common seal of the Company “Seal”

(2) Words importing the singular number shall include the plural

number and words importing the masculine gender shall, where

the context admits, include the feminine and neuter gender.

“Number” and

“Gender”

(3) Unless the context otherwise requires, words or expressions

contained in these Articles shall bear the same meaning as in the Act

or the Rules, as the case may be.

Expressions in the

Articles to bear

the same meaning

as in the Act

New Article of Association adopted vide Special Resolution passed at

EOGM held on 27.01.2018

Share capital and variation of rights

3. Subject to the provisions of the Act and these Articles, the shares in the

capital of the Company shall be under the control of the Board who may

issue, allot or otherwise dispose of the same or any of them to such

persons, in such proportion and on such terms and conditions and either

at a premium or at par and at such time as they may from time to time

think fit.

Shares under

control of Board

4. Subject to the provisions of the Act and these Articles, the Board may

issue and allot shares in the capital of the Company on payment or part

payment for any property or assets of any kind whatsoever sold or

transferred, goods or machinery supplied or for services rendered to the

Directors may

allot shares

otherwise than for

cash

289


Company in the conduct of its business and any shares which may be so

allotted may be issued as fully paid-up or partly paid-up otherwise than for

cash, and if so issued, shall be deemed to be fully paid-up or partly paid-

up shares, as the case may be.

5. The Company may issue the following kinds of shares in accordance

with these Articles, the Act, the Rules and other applicable laws:

(a) Equity share capital

(i) with voting rights; and / or

(ii) with differential rights as to dividend, voting or

otherwise in accordance with the Rules; and

(b) Preference share capital

Kinds of Share

Capital

6. (1) Every person whose name is entered as a member in the

register of members shall be entitled to receive within two months

after allotment or within one month from the date of receipt by the

Company of the application for the registration of transfer or

transmission or within such other period as the conditions of issue

shall provide -

(a) one certificate for all his shares without payment of any

charges;

or

(b) Several certificates, each for one or more of his shares,

upon payment of such charges as may be fixed by the Board for

each certificate after the first.

Issue of certificate

(2) Every certificate shall be under the seal and shall specify the shares

to which it relates and the amount paid-up thereon. Certificate to bear

seal

(3) In respect of any share or shares held jointly by several persons, the

Company shall not be bound to issue more than one certificate, and

delivery of a certificate for a share to one of several joint holders

shall be sufficient delivery to all such holders.

One certificate for

shares held jointly

(4) Any member of the Company shall have the right to sub-divide, split

or consolidate the total number of shares held by them in any manner

and to request the Company to provide certificate(s) evidencing such

sub- division, split or consolidation

7. A person subscribing to shares offered by the Company shall have the option

either to receive certificates for such shares or hold the shares in a

dematerialized state with a depository. Where a person opts to hold any share

with the depository, the Company shall intimate such depository the details of

allotment of the share to enable the depository to enter in its records the name

of such person as the beneficial owner of that share. In such a situation, the

rights and obligations of the parties concerned and matters connected

therewith shall be governed by the provisions of the Depositories Act, 1996,

as amended from time to time, or any statutory modification thereto or re-

enactment thereof.

Option to receive

share certificate or

hold shares with

depository

8. If any share certificate be worn out, defaced, mutilated or torn or if there be no

further space on the back for endorsement of transfer, then upon production

and surrender thereof to the Company, a new certificate may be issued in lieu

thereof, and if any certificate is lost or destroyed then upon proof thereof to the

satisfaction of the Company and on execution of such indemnity as the Board

deems adequate, a new certificate in lieu thereof shall be given. Every

certificate under this Article shall be issued on payment of fees for each

Issue of new

certificate in place

of one defaced, lost

or destroyed

290


certificate as may be fixed by the Board.

9. The provisions of the foregoing Articles relating to issue of certificates

shall mutatis mutandis apply to issue of certificates for any other securities

including debentures (except where the Act otherwise requires) of the

Company.

Provisions as to

issue of certificates

to apply mutatis

mutandis to

debentures, etc.

10. (1) The Company may exercise the powers of paying commissions

conferred by the Act, to any person in connection with the

subscription to its securities, provided that the rate per cent or the

amount of the commission paid or agreed to be paid shall be

disclosed in the manner required by the Act and the Rules.

Power to

pay commission in

connection with

securities issued

(2) The rate or amount of the commission shall not exceed the rate or

amount prescribed in the Rules. Rate of

commission in

accordance with

Rules

(3) The commission may be satisfied by the payment of cash or the

allotment of fully or partly paid shares or partly in the one way and

partly in the other.

Mode of payment

of commission

11. (1) If at any time the share capital is divided into different classes of

shares, the rights attached to any class (unless otherwise provided

by the terms of issue of the shares of that class) may, subject to the

provisions of the Act, and whether or not the Company is being

wound up, be varied with the consent in writing, of such number of

the holders of the issued shares of that class, or with the sanction of a

resolution passed at a separate meeting of the holders of the

shares of that class, as prescribed by the Act.

Variation of

members’ rights

(2) To every such separate meeting, the provisions of these Articles

relating to general meetings shall mutatis mutandis apply. Provisions as to

general meetings

to apply mutatis

mutandis to each

meeting

12. The rights conferred upon the holders of the shares of any class issued with

preferred or other rights shall not, unless There wise expressly provided by the

terms of issue of the shares of that class, be deemed to be varied by the

creation or issue of further shares ranking pari passu therewith.

Issue of further

shares not to affect

rights of existing

members

13. Subject to the provisions of the Act, the Board shall have the power to

issue or re-issue preference shares of one or more classes which are liable

to be redeemed, or converted to equity shares, on such terms and

conditions and in such manner as determined by the Board in

accordance with the Act.

Power to issue

redeemable

preference shares

14. (1) The Board or the Company, as the case may be, may, in accordance with

the Act and the Rules, issue further securities to –

a. persons who, at the date of offer, are holders of equity shares of

the Company; such offer shall be deemed to include a right

exercisable by the person concerned to renounce the shares

offered to him or any of them in favor of any other person; or

b. employees under any scheme of employees’ stock option; or

c. Any persons, whether or not those persons include the persons

referred to in clause (a) or clause (b) above

Further issue of

share securities

(2) A further issue of securities may be made in any manner whatsoever as

the Board may determine including by way of preferential offer or

private placement or Initial Public Offering (IPO) subject to and in

accordance with the Companies Act 2013 & the Rules made

thereunder, SEBI regulations and FEMA Regulations.

Mode of further

issue of securities

Lien

291


15. (1) The Company shall have a first and paramount

lien:

on every share (not being a fully paid share), for all monies (whether

presently payable or not) called, or payable at a fixed time, in

respect of that share.

Provided that fully paid up shares shall be free from all

lien.

Provided that the Board may at any time declare any share to

be wholly or in part exempt from the provisions of this clause.

Company’s lien

on shares

(2) The Company’s lien, if any, on a share shall extend to all dividends

or interest, as the case may be, payable and bonuses declared from

time to time in respect of such shares for any money owing to the

Company.

Lien to extend to

dividends, etc.

(3) Unless otherwise agreed by the Board, the registration of a transfer

of shares shall operate as a waiver of the Company’s lien. Waiver of lien in

case of registration

16. The Company may sell, in such manner as the Board thinks fit, any

shares on which the Company has a lien:

Provided that no sale shall be

made—

(a) unless a sum in respect of which the lien exists is presently

payable; or

(b) until the expiration of fourteen days after a notice in writing

stating and demanding payment of such part of the amount in

respect of which the lien exists as is presently payable, has been

given to the registered holder for the time being of the share or

to the person entitled thereto by reason of his death or

insolvency or otherwise.

17. (1) To give effect to any such sale, the Board may authorize some person

to transfer the shares sold to the purchaser thereof. Validity of sale

(2) The purchaser shall be registered as the holder of the shares

comprised in any such transfer. Purchaser to be

registered holder

(3) The receipt of the Company for the consideration (if any) given

for the share on the sale thereof shall (subject, if necessary, to

execution of an instrument of transfer or a transfer by relevant

system, as the case may be) constitute a good title to the share and

the purchaser shall be registered as the holder of the share.

Validity of

Company’s receipt

(4) The purchaser shall not be bound to see to the application of the

purchase money, nor shall his title to the shares be affected by any

irregularity or invalidity in the proceedings with reference to the sale.

Purchaser not

affected

18. (1) The proceeds of the sale shall be received by the Company and

applied in payment of such part of the amount in respect of which the

lien exists as is presently payable.

Application

of proceeds of sale

(2) The residue, if any, shall, subject to a like lien for sums not

presently payable as existed upon the shares before the sale, be

paid to the person entitled to the shares at the date of the sale.

Payment of

residual money

19. In exercising its lien, the Company shall be entitled to treat the registered

holder of any share as the absolute owner thereof and accordingly shall

not (except as ordered by a court of competent jurisdiction or unless

required by any statute) be bound to recognize any equitable or other

claim to, or interest in, such share on the part of any other person,

whether a creditor of the registered holder or otherwise. The Company’s

lien shall prevail notwithstanding that it has received notice of any such

Outsider’s lien not

to affect

Company’s

lien

292


claim.

20. The provisions of these Articles relating to lien shall mutatis

mutandis apply to any other securities including debentures of the

Company.

Provisions as to

lien to apply

mutatis mutandis

to debentures, etc

Calls on shares

21. (1) The Board may, from time to time, make calls upon the members in

respect of any monies unpaid on their shares (whether on account of

the nominal value of the shares or by way of premium) and not by

the conditions of allotment thereof made payable at fixed times.

Provided that the Board shall not give the option or right to call on

shares to any person except with the sanction of the Company in the

General Meeting.

Board may

make calls

(2) Each member shall, subject to receiving at least fourteen days’

notice specifying the time or times and place of payment, pay to the

Company, at the time or times and place so specified, the amount

called on his shares.

Notice of call

(3) The Board may, from time to time, at its discretion, extend the time

fixed for the payment of any call in respect of one or more members

as the Board may deem appropriate in any circumstances

Board may

extend time for

payment

(4) A call may be revoked or postponed at the discretion of the Board. Revocation

or postponement

of call

22. A call shall be deemed to have been made at the time when the

resolution of the Board authorizing the call was passed and may be

required to be paid by installments.

Call to take effect

from date of

resolution

23. The joint holders of a share shall be jointly and severally liable to pay all

calls in respect thereof.

Liability of joint

holders of shares

24. (1) If a sum called in respect of a share is not paid before or on the

day appointed for payment thereof (the “due date”), the person

from whom the sum is due shall pay interest thereon from the due

date to the time of actual payment at such rate as may be fixed by

the Board.

When interest on

call or installment

payable

(2) The Board shall be at liberty to waive payment of any such interest

wholly or in part. Board may waive

interest

25. (1) Any sum which by the terms of issue of a share becomes payable on

allotment or at any fixed date, whether on account of the nominal

value of the share or by way of premium, shall, for the purposes of

these Articles, be deemed to be a call duly made and payable on the

date on which by the terms of issue such sum becomes payable.

Sums deemed to be

calls

(2) In case of non-payment of such sum, all the relevant provisions of

these Articles as to payment of interest and expenses, forfeiture or

otherwise shall apply as if such sum had become payable by virtue of

a call duly made and notified

Effect of non-

payment of sums

26. The Board –

(a) may, if it thinks fit, receive from any member willing to

advance the same, all or any part of the monies uncalled and

unpaid upon any shares held by him; and

(b) Upon all or any of the monies so advanced, may (until

the same would, but for such advance, become presently

Payment in

anticipation of

calls may carry

interest

293


payable) pay interest at such rate as may be fixed by the

Board. Nothing contained in this clause shall confer on

the member(a) any right to participate in profits or

dividends or (b) any voting rights in respect of the moneys so

paid by him until the same would, but for such payment,

become presently payable by him

27. If by the conditions of allotment of any shares, the whole or part of the

amount of issue price thereof shall be payable by installments, then

every such installment shall, when due, be paid to the Company by the

person who, for the time being and from time to time, is or shall be

the registered holder of the share or the legal representative of a

deceased registered holder.

Installments on

shares to be duly

paid

28. All calls shall be made on a uniform basis on all shares falling under the

same class.

Explanation: Shares of the same nominal value on which different

amounts have been paid-up shall not be deemed to fall under the

same class.

Calls on shares of

same class to be on

uniform basis

29. Neither a judgment nor a decree in favor of the Company for calls or other

moneys due in respect of any shares nor any part payment or satisfaction

thereof nor the receipt by the Company of a portion of any money which

shall from time to time be due from any member in respect of any shares

either by way of principal or interest nor any indulgence granted by the

Company in respect of payment of any such money shall preclude the

forfeiture of such shares as herein provided

Partial payment

not to preclude

forfeiture

30. The provisions of these Articles relating to calls shall mutatis


Company.

Provisions as to

calls to apply

mutatis mutandis

to debentures, etc.

31. Where capital is paid in advance of calls on the footing that the same

shall carry interest, such capital shall not, whilst carrying interest, confer a

right to participate in profits.

Capital paid in

advance of calls at

interest not to

earn dividend

Transfer of shares

32. The Company shall use a common form of transfer. The instrument of

transfer shall be in writing and all the provisions of Section 56 of the Act

and of any statutory modification thereof for the time being shall be duly

complied with in respect of all transfer of shares and the

registration thereof.

Common form of

transfer

33. (1) The instrument of transfer of any share in the Company shall be

duly executed by or on behalf of both the transferor and transferee.

Instrument of

transfer to be

executed by

transferor and

transferee

(2) The transferor shall be deemed to remain a holder of the share until

the name of the transferee is entered in the register of members in

respect thereof.

34. The Board may, subject to the right of appeal conferred by the Act decline

to register –

(a) the transfer of a share, not being a fully paid share, to a person of

whom they do not approve; or

(b) Any transfer of shares on which the Company has a

lien.

Provided that registration of a transfer shall not be refused on the ground

of the transferor being either alone, or jointly with another person or

Board may refuse

to register transfer

294


persons, indebted to the Company on any account whatsoever, except

where the Company has a lien on the shares being transferred.

35. In case of shares held in physical form, the Board may decline to

recognize any instrument of transfer unless –

(a) the instrument of transfer is duly executed and is in the form as

prescribed in the Rules made under the Act;

(b) the instrument of transfer is accompanied by the certificate of

the shares to which it relates, and such other evidence as the

Board may reasonably require to show the right of the transferor

to make the transfer; and

(c) The instrument of transfer is in respect of only one class of

shares

Board may decline

to recognize

instrument of

transfer

36. Lesser period in accordance with the Act and Rules made thereunder, the

registration of transfers may be suspended at such times and for such

periods as the Board may from time to time determine:

Provided that such registration shall not be suspended for more than thirty

days at any one time or for more than forty- five days in the aggregate in

any year.

Transfer of shares

when suspended

37. The provisions of these Articles relating to transfer of shares shall mutatis


Company.

Provisions as to

transfer of shares

to apply mutatis

mutandis to

debentures, etc

Transmission of Shares

38. On the death of a member, the survivor or survivors where the member

was a joint holder, and his nominee or nominees or legal representatives

where he was a sole holder, shall be the only persons recognized by the

Company as having any title to his interest in the shares.

Nothing in clause (1) shall release the estate of a deceased joint holder

from any liability in respect of any share which had been jointly held by

him with other persons.

Title to shares

on death of a

member

Estate of

deceased

member liable

39. (1) Any person becoming entitled to a share in consequence of the death

or insolvency of a member may, upon such evidence being produced

as may from time to time properly be required by the Board and

subject as hereinafter provided, elect, either –

(a) to be registered himself as holder of the share; or

(b) to make such transfer of the share as the deceased or

insolvent member could have made.

Transmission

Clause

(2) The Board shall, in either case, have the same right to decline

or suspend registration as it would have had, if the deceased or

insolvent member had transferred the share before his death or

insolvency.

Board’s right

unaffected

(3) The Company shall be fully indemnified by such person from Indemnity to the

295


all liability, if any, by actions taken by the Board to give effect to

such registration or transfer.

company

40. (1) If the person so becoming entitled shall elect to be registered as

holder of the share himself, he shall deliver or send to the Company a

notice in writing signed by him stating that he so elects.

Right to election

of holder of share

(2) If the person aforesaid shall elect to transfer the share, he shall

testify his election by executing a transfer of the share.

Manner of

testifying election

(3) All the limitations, restrictions and provisions of these

regulations relating to the right to transfer and the registration of

transfers of shares shall be applicable to any such notice or transfer

as aforesaid as if the death or insolvency of the member had not

occurred and the notice or transfer were a transfer signed by that

member.

Limitations

applicable to

notice

41. A person becoming entitled to a share by reason of the death or

insolvency of the holder shall be entitled to the same dividends and

other advantages to which he would be entitled if he were the

registered holder of the share, except that he shall not, before being

registered as a member in respect of the share, be entitled in respect of it

to exercise any right conferred by membership in relation to meetings of

the Company:

Provided that the Board may, at any time, give notice requiring any

such person to elect either to be registered himself or to transfer the share,

and if the notice is not complied with within ninety days, the Board may

thereafter withhold payment of all dividends, bonuses or other monies

payable in respect of the share, until the requirements of the notice have

been complied with.

Claimant to be

entitled to same

advantage

42. The provisions of these Articles relating to transmission by operation of

law shall mutatis mutandis apply to any other securities including

debentures of the Company.

Provisions as to

transmission to

apply mutatis

mutandis to

debentures, etc.

Forfeiture of shares

43. If a member fails to pay any call, or instalment of a call or any money due

in respect of any share, on the day appointed for payment thereof,

the Board may, at any time thereafter during such time as any part of the

call or instalment remains unpaid or a judgement or decree in respect

thereof remains unsatisfied in whole or in part, serve a notice on him

requiring payment of so much of the call or instalment or other money as

is unpaid, together with any interest which may have accrued and all

expenses that may have been incurred by the Company by reason of non-

payment.

If call or

installment not

paid notice must

be given

44. The notice aforesaid shall:

(a) name a further day (not being earlier than the expiry of

fourteen days from the date of service of the notice) on or

before which the payment required by the notice is to be made;

and

(b) state that, in the event of non-payment on or before the day so

named, the shares in respect of which the call was made shall

be liable to be forfeited.

Form of notice

296


45. If the requirements of any such notice as aforesaid are not complied

with, any share in respect of which the notice has been given may, at

any time thereafter, before the payment required by the notice has been

made, be forfeited by a resolution of the Board to that effect

In default of

payment of shares

to be forfeited

46. Neither the receipt by the Company for a portion of any money which

may from time to time be due from any member in respect of his shares,

nor any indulgence that may be granted by the Company in respect of

payment of any such money, shall preclude the Company from thereafter

proceeding to enforce a forfeiture in respect of such shares as herein

provided. Such forfeiture shall include all dividends declared or any

other moneys payable in respect of the forfeited shares and not actually

paid before the forfeiture. Provided, there shall be no forfeiture of

unclaimed dividend before the claim for such dividend becomes barred by

law. The Company shall comply with the provisions of the Act in respect

of any dividend remaining unpaid or unclaimed with the Company.

Receipt of part

amount or grant of

indulgence not to

affect forfeiture

47. When any share shall have been so forfeited, notice of the forfeiture shall

be given to the defaulting member and an entry of the forfeiture

with the date thereof, shall forthwith be made in the register of members

but no forfeiture shall be invalidated by any omission or neglect or any

failure to give such notice or make such entry as aforesaid.

Entry of forfeiture

in register of

members

48. The forfeiture of a share shall involve extinction at the time of

forfeiture, of all interest in and all claims and demands against the

Company, in respect of the share and all other rights incidental to the

share.

Effect of forfeiture

49. (1) The forfeiture of a share shall involve extinction at the time of

forfeiture, of all interest in and all claims and demands against the

Company, in respect of the share and all other rights incidental to

the share.

Forfeited shares

may be sold, etc.

(2) At any time before a sale, re-allotment or disposal as aforesaid, the Board

may cancel the forfeiture on such terms as it thinks fit. Cancellation of

forfeiture

50. (1) A person whose shares have been forfeited shall cease to be a

member in respect of the forfeited shares, but shall, notwithstanding

the forfeiture, remain liable to pay, and shall pay, to the Company

all monies which, at the date of forfeiture, were presently payable

by him to the Company in respect of the shares.

Members still

liable to pay

money owing at

the time of

forfeiture

(2) All such monies payable shall be paid together with interest thereon at

such rate as the Board may determine, from the time of forfeiture until

payment or realization. The Board may, if it thinks fit, but without

being under any obligation to do so, enforce the payment of the whole

or any portion of the monies due, without any allowance for the value

of the shares at the time of forfeiture or waive payment in whole or in

part.

Member still liable

to pay money

owing at time of

forfeiture and

interest

(3) The liability of such person shall cease if and when the Company

shall have received payment in full of all such monies in respect of

the shares.

Cesser of liability

51. (1) A duly verified declaration in writing that the declarant is a director,

the manager or the secretary of the Company, and that a share in the

Company has been duly forfeited on a date stated in the declaration,

shall be conclusive evidence of the facts therein stated as against all

persons claiming to be entitled to the share;

Certificate of

forfeiture

297


(2) The Company may receive the consideration, if any, given for the

share on any sale, re-allotment or disposal thereof and may execute a

transfer of the share in favor of the person to whom the share is sold

or disposed of;

Title of purchaser

and transferee of

forfeited shares

(3) The transferee shall thereupon be registered as the holder of the

share; and

Transferee to be

registered as

holder

(4) The transferee shall not be bound to see to the application of the

purchase money, if any, nor shall his title to the share be affected by

any irregularity or invalidity in the proceedings in reference to the

forfeiture, sale, re- allotment or disposal of the share.

Transferee not

affected

52. Upon any sale after forfeiture or for enforcing a lien in exercise of

the powers hereinabove given, the Board may, if necessary, appoint some

person to execute an instrument for transfer of the shares sold and

cause the purchaser’s name to be entered in the register of members in

respect of the shares sold and after his name has been entered in the

register of members in respect of such shares the validity of the sale shall

not be impeached by any person.

Validity of sales

53. Upon any sale, re-allotment or other disposal under the provisions of the

preceding Articles, the certificate(s), if any, originally issued in respect of

the relative shares shall (unless the same shall on demand by the Company

has been previously surrendered to it by the defaulting member) stand

cancelled and become null and void and be of no effect, and the

Board shall be entitled to issue a duplicate certificate(s) in respect of the

said shares to the person(s) entitled thereto.

Cancellation of

share certificate

in respect of

forfeited shares

54. The Board may, subject to the provisions of the Act, accept a surrender of

any share from or by any member desirous of surrendering them on such

terms as they think fit.

Surrender of

share certificates

55. The provisions of these Articles as to forfeiture shall apply in the case of

non-payment of any sum which, by the terms of issue of a share, becomes

payable at a fixed time, whether on account of the nominal value of the

share or by way of premium, as if the same had been payable by virtue of

a call duly made and notified.

Sums deemed to be

calls

56. The provisions of these Articles relating to forfeiture of shares shall

mutatis mutandis apply to any other securities including debentures of the

Company.

Provisions as to

forfeiture of

shares to apply

mutatis mutandis

to debentures, etc.

Underwriting, Commission and Brokerage

57. (1) The company may pay commission to any person in

connection with the subscription or procurement of subscription to its

securities, whether absolute or conditional, subject to the following

conditions, namely

(a) the payment of such commission shall be authorized in the

company’s articles of association

(b) the commission may be paid out of proceeds of the issue

or the profit of the company or both

(c) the rate of commission paid or agreed to be paid shall not

298


exceed, in case of shares, five percent of the price at which

the shares are issued or a rate authorised by the articles,

whichever is less, and in case of debentures, shall not

exceed two and a half per cent of the price at which the

debentures are issued, or as specified in the company’s

articles, whichever is less

(d) the prospectus of the company shall disclose

(i) the name of the underwriters

(ii) the rate and amount of the commission payable to the

underwriter; and

(iii) the number of securities which is to be

underwritten or subscribed by the underwriter absolutely

or conditionally. Lieu of Prospectus and filed before the

payment of the commission with the Registrar and

where a circular or notice not being a prospectus

inviting subscription for the shares or debentures is

issued is also disclosed in that circular or notice;

(e) there shall not be paid commission to any underwriter on

securities which are not offered to the public for

subscription;

(2) Save as aforesaid and save as provided in Section 53 of the Act,

the Company shall not allot any of its shares or debentures or

apply any of its moneys, either directly or indirectly, in payment

of any commission, discount or allowance, to any person in

consideration of :

(a) Save as aforesaid and save as provided in Section 53 of the

Act, the Company shall not allot any of its shares or

debentures or apply any of its moneys, either directly or

indirectly, in payment of any commission, discount or

allowance, to any person in consideration of;

(b) his procuring or agreeing to procure subscriptions,

whether absolutely or conditionally, for any shares in, or

debentures of the Company whether the shares, debentures

or money be so allotted or applied by, being added to the

purchase money of any property acquired by the Company

or to the contract price of any work to be executed for the

Company, or the money be paid by as the nominal purchase

money or contract price, or otherwise

(3) Nothing in this Article shall affect the power of the Company to pay

such brokerage as it has hereto before been lawful for the Company

to pay.

(4) The commission may be paid or satisfied (subject to the provisions

of the Act and these articles) in cash, or in shares, debentures or

debenture-stocks of the Company.

Alteration of capital

58. Subject to the provisions of the Act, the Company may, by ordinary

299


resolution –

(a) increase the share capital by such sum, to be divided into shares

of such amount as it thinks expedient;

(b) consolidate and divide all or any of its share capital into shares

of larger amount than its existing shares:

Provided that any consolidation and division which results in changes

in the voting percentage of members shall require applicable

approvals under the Act;

(c) convert all or any of its fully paid-up shares into stock, and

reconvert that stock into fully paid-up shares of any denomination;

(d) sub-divide its existing shares or any of them into shares of

smaller amount than is fixed by the memorandum;

(e) Cancel any shares which, at the date of the passing of the

resolution, have not been taken or agreed to be taken by any

person.

59. Where shares are converted into stock:

(a) The holder of stock may transfer the same or any part thereof

in the same manner as, and subject to the same Articles under

which, the shares from which the stock arose might before the

conversion have been transferred, or as near thereto as

circumstances admit:

Provided that the Board may, from time to time, fix the minimum

amount of stock transferable, so, however, that such minimum

shall not exceed the nominal amount of the shares from which

the stock arose;

(b) the holders of stock shall, according to the amount of stock held

by them, have the same rights, privileges and advantages as

regards dividends, voting at meetings of the Company, and

other matters, as if they held the shares from which the stock

arose; but no such privilege or advantage (except participation in

the dividends and profits of the Company and in the assets on

winding up) shall be conferred by an amount of stock which

would not, if existing in shares, have conferred that privilege or

advantage;

(c) such of these Articles of the Company as are applicable to paid-

up shares shall apply to stock and the words “share” and

“shareholder”/“member” shall include “stock” and “stock-holder”

respectively.

60. The Company may, by resolution as prescribed by the Act, reduce in any

manner and in accordance with the provisions of the Act and the Rules,

(a) its share capital; and/or

(b) any capital redemption reserve account; and/or

(c) any securities premium account; and/or

(d) any other reserve in the nature of share capital.

Reduction of

capital

61. Where two or more persons are registered as joint holders (not more than

300


three) of any share, they shall be deemed (so far as the Company

is concerned) to hold the same as joint tenants with benefits of

survivorship, subject to the following and other provisions contained in

these Articles:

(a) The joint-holders of any share shall be liable severally as well

as jointly for and in respect of all calls or instalments and

other payments which ought to be made in respect of such

share

(b) On the death of any one or more of such joint- holders, the

survivor or survivors shall be the only person or persons

recognized by the Company as having any title to the share but

the Directors may require such evidence of death as they may

deem fit, and nothing herein contained shall be taken to release

the estate of a deceased joint-holder from any liability on

shares held by him jointly with any other person.

(c) Any one of such joint holders may give effectual receipts of

any dividends, interests or other moneys payable in respect of

such share\

(d) Only the person whose name stands first in the register of

members as one of the joint-holders of any share shall be

entitled to the delivery of certificate, if any, relating to such

share or to receive notice (which term shall be deemed to

include all relevant documents) and any notice served on or

sent to such person shall be deemed service on all the joint-

holders.

(e) i) Any one of two or more joint-holders may vote at any

meeting either personally or by attorney or by proxy in respect

of such shares as if he were solely entitled thereto and if more

than one of such joint holders be present at any meeting

personally or by proxy or by attorney then that one of such

persons so present whose name stands first or higher (as the

case may be) on the register in respect of such shares shall

alone be entitled to vote in respect thereof

ii) Several executors or administrators of a deceased member

in whose (deceased member) sole name any share stands,

shall for the purpose of this clause be deemed joint-

holders.

(f) The provisions of these Articles relating to joint holders of

shares shall mutatis mutandis apply to any other securities

including debentures of the Company registered in joint

names.

Liability of Joint

holders:

Death of one or

more joint-

holders:

Receipt of one

sufficient

Delivery of

certificate and

giving of notice to

first named holder

Vote of joint

holders;

Executor or

administrator as

joint holders:

Provision as to

joint holders as to

share to apply

mutatis mutandis

to debenture, etc.

Capitalization of profit

62. (1) The Company by ordinary resolution in general meeting may,

upon the recommendation of the Board, resolve —

a) That it is desirable to capitalize any part of the amount for the

time being standing to the credit of any of the Company’s

reserve accounts, or to the credit of the profit and loss account,

or otherwise available for distribution; and

b) That such sum be accordingly set free for distribution in the

manner specified in clause (2) below amongst the members who

would have been entitled thereto, if distributed by way of

dividend and in the same proportions

Capitalisation

301


(2) The sum aforesaid shall not be paid in cash but shall be applied,

subject to the provision contained in clause (3) below, either in or

towards :

a) paying up any amounts for the time being unpaid on any shares

held by such members respectively

b) paying up in full, unissued shares or other securities of the

Company to be allotted and distributed, credited as fully

paid-up, to and amongst such members in the proportions

aforesaid

c) Partly in the way specified in sub-clause (A) and partly

in that specified in sub-clause (B).

Sum how applied

(3) A securities premium account and a capital redemption reserve

account or any other permissible reserve account may, for the

purposes of this Article, be applied in the paying up of unissued

shares to be issued to members of the Company as fully paid bonus

shares;

(4) The Board shall give effect to the resolution passed by the

Company in pursuance of this Article.

63. (1) Whenever such a resolution as aforesaid shall have been passed, the

Board shall –

a) make all appropriations and applications of the amounts

resolved to be capitalised thereby, and all allotments and

issues of fully paid shares or other securities, if any; and

b) Generally do all acts and things required to give effect thereto

Powers of the

Board for

Capitalization

(2) The Board shall have power— (a) to make such provisions, by the issue of fractional

certificates coupons or by payment in cash or

otherwise as it thinks fit, for the case of shares or other

securities becoming distributable in fractions; and

(b) to authorise any person to enter, on behalf of all the

members entitled thereto, into an agreement with the

Company providing for the allotment to them

respectively, credited as fully paid-up, of any further

shares or other securities to which they may be

entitled upon such capitalisation, or as the case may

require, for the payment by the Company on their

behalf, by the application thereto of their

respective proportions of profits resolved to be

capitalised, of the amount or any part of the amounts

remaining unpaid on their existing shares.

.

Board power to

issue fractional

certificate/coupn

etc.

(3) Any agreement made under such authority shall be effective and

binding on such members.

Agreement

binding on

members

Buy Back of Shares

64. Notwithstanding anything contained in these Articles but subject to all

applicable provisions of the Act or any other law for the time being in Buy-back of

shares

302


force, the Company may purchase its own shares or other specified

securities.

General- Meeting

65. All general meetings other than annual general meeting shall be called

extraordinary general meeting. Extraordinay

general meeting

66. The Board may, whenever it thinks fit, call an extraordinary

general meeting.

Powers of Board

to call

extraordinary

general meeting

Proceedings at general meetings

67. (1) No business shall be transacted at any general meeting unless

a quorum of members is present at the time when the

meeting proceeds to business.

Presence of

Quorum

(2) No business shall be discussed or transacted at any general

meeting except election of Chairperson whilst the chair is

vacant.

Business confined

to election of

Chairperson

whilst chair vacant

(3) The quorum for a general meeting shall be as provided

in the Act.

Quorum for

general meeting

68. The Chairperson of the Company shall preside as Chairperson at

every general meeting of the Company. Quorum for

general meeting

69. If there is no such Chairperson, or if he is not present within fifteen

minutes after the time appointed for holding the meeting, or is unwilling

to act as chairperson of the meeting, the directors present shall elect one

of their members to be Chairperson of the meeting.

Directors to elect a

chairperson

70. If at any meeting no director is willing to act as Chairperson or if

no

director is present within fifteen minutes after the time appointed for

holding the meeting, the members present shall, by poll or

electronically, choose one of their members to be Chairperson of the

meeting

Members to elect

chairperson

71. On any business at any general meeting, in case of an equality of votes,

whether on a show of hands or electronically or on a poll, the

Chairperson shall have a second or casting vote.

Casting vote of

Chairperson at

general meeting

72. (1) The Company shall cause minutes of the proceedings of every

general meeting of any class of members or creditors and

every resolution passed by postal ballot to be prepared and

signed in such manner as may be prescribed by the Rules and

kept by making within thirty days of the conclusion of every

such meeting concerned or passing of resolution by postal

ballot entries thereof in books kept or that purpose with

their pages consecutively numbered

Minutes of

proceedings of

meetings and

resolutions passed

by postal ballot

(2) There shall not be included in the minutes any matter

which, in the opinion of the Chairperson of the

meeting –

(a) Is, or could reasonably be regarded, as defamatory

of any person; or

(b) Is irrelevant or immaterial to the

Certain matters

not to be included

in Minutes

303


proceedings; or

(c) Is detrimental to the interests of the

Company

(3) The Chairperson shall exercise an absolute discretion in regard

to the inclusion or non-inclusion of any matter in the minutes on

the grounds specified in the aforesaid clause.

Discretion of

Chairperson in

relation to

Minutes

(4) The minutes of the meeting kept in accordance with the

provisions of the Act shall be evidence of the proceedings

recorded therein.

Minutes to be

evidence

73. (1) The books containing the minutes of the proceedings of any general

meeting of the Company or a resolution passed by postal ballot

shall:

a) be kept at the registered office of the Company; and

b) be open to inspection of any member without charge,

during

11.00 a.m. to 1.00 p.m. on all working days other

than Saturdays.

Inspection of

minute book of

general meeting

(2) Any member shall be entitled to be furnished, within the time

prescribed by the Act, after he has made a request in writing in that

behalf to the Company and on payment of such fees as may be fixed

by the Board, with a copy of any minutes referred to in clause (1)

above:

Provided that a member who has made a request for provision of a

soft copy of the minutes of any previous general meeting held

during the period immediately preceding three financial years, shall

be entitled to be furnished with the same free of cost.

Members may

obtain copy of

minutes

74. The Board, and also any person(s) authorised by it, may take any

action before the commencement of any general meeting, or any

meeting of a class of members in the Company, which they may think

fit to ensure the security of the meeting, the safety of people attending

the meeting, and the future orderly conduct of the meeting. Any

decision made in good faith under this Article shall be final, and

rights to attend and participate in the meeting concerned shall be

subject to such decision.

Power to arrange

security at meeting

Adjournment of meeting

75. (1) The Chairperson may, suo -motu, adjourn the meeting from

time to time and from place to place.

Chairperson

may adjourn the

meeting

(2) No business shall be transacted at any adjourned meeting other

than the business left unfinished at the meeting from which the

adjournment took place.

Business at

adjourned meeting

(3) When a meeting is adjourned for thirty days or more, notice of

the adjourned meeting shall be given as in the case of an

original meeting.

Business at

adjourned meeting

(4) Save as aforesaid, and save as provided in the Act, it shall not

be necessary to give any notice of an adjournment or of the

business to be transacted at an adjourned meeting.

Notice of

adjourned meeting

not required

304


Voting Rights

76. Subject to any rights or restrictions for the time being attached to any

class or classes of shares –

(a) On a show of hands, every member present in

person shall have one vote; and

(b) On a poll, the voting rights of members shall be in

proportion to his share in the paid-up equity share

capital of the company

Entitlement to vote

on show of hands

and on poll

77. A member may exercise his vote at a meeting by electronic means in

accordance with the Act and shall vote only once. Voting through

electronic means

78. (1) In the case of joint holders, the vote of the senior who tenders

a vote, whether in person or by proxy, shall be accepted to the

exclusion of the votes of the other joint holders.

Vote of Joint

holders

(2) For this purpose, seniority shall be determined by the order

in which the names stand in the register of members. Seniority of names

79. .A member of unsound mind, or in respect of whom an order has

been made by any court having jurisdiction in lunacy, may vote,

whether on a show of hands or on a poll, by his committee or other

legal guardian, and any such committee or guardian may, on a poll, vote

by proxy. If any member be a minor, the vote in respect of his share or

shares shall be by his guardian or any one of his guardians

How members non

compos mentis and

minor may vote

80. Subject to the provisions of the Act and other provisions of these

Articles, any person entitled under the Transmission Clause to any

shares may vote at any general meeting in respect thereof as if he

was the registered holder of such shares, provided that at least 48 (forty

eight) hours before the time of holding the meeting or adjourned

meeting, as the case may be, at which he proposes to vote, he

shall duly satisfy the Board of his right to such shares unless the

Board shall have previously admitted his right to vote at such meeting

in respect thereof

How members non

compos mentis and

minor may vote

81. Any business other than that upon which a poll has been demanded may

be proceeded with, pending the taking of the poll. Business may

proceed pending

poll

82. No member shall be entitled to vote at any general meeting unless all

calls or other sums presently payable by him in respect of shares in the

Company have been paid or in regard to which the Company has

exercised any right of lien.

Restriction on

voting rights

83. A member is not prohibited from exercising his voting on the

ground that he has not held his share or other interest in the

Company for any specified period preceding the date on which the vote

is taken, or on any other ground not being a ground set out in the

preceding Article

Restriction on

exercise of voting

rights in other

cases to be void

84. Any member whose name is entered in the register of members of the

Company shall enjoy the same rights and be subject to the same

liabilities as all other members of the same class.

Equal rights of

members

Proxy

85. (1) Any member entitled to attend and vote at a general meeting

may do so either personally or through his constituted

attorney or through another person as a proxy on his behalf, for

that meeting.

Member may

vote in person or

otherwise

(2) The instrument appointing a proxy and the power-of-attorney Proxies when to

305


or other authority, if any, under which it is signed or a notarised

copy or that power or authority, shall be deposited at the

registered office of the Company not less than 48 hours before the

time for holding the meeting or adjourned meeting at which the

person named in the instrument proposes to vote, and in default

the instrument of proxy shall not be treated as valid.

be deposited

86. An instrument appointing a proxy shall be in the form as prescribed in

the Rules.

Form of Proxy

87. A vote given in accordance with the terms of an instruments of

proxy shall be valid, notwithstanding the previous death or insanity of the

principal or the revocation of the proxy or of the authority under which

the proxy was executed, or the transfer of the shares in respect of which

the proxy is given:

Provided that no intimation in writing of such death, insanity, revocation

or transfer shall have been received by the company at its office before

the commencement of the meeting or adjourned meeting at which the

proxy is used.

Proxy to be valid

notwithstanding

death of the

principal

Board of Directors

88. Unless otherwise determined by the company in general meeting, the

number of directors shall not be less than 3(three) and shall not be more

than 14(fourteen)

Board of Directors

89. The same individual may, at the same time, be appointed as the

Chairperson of the company as well as the Managing Director or Chief

Executive Officer of the Company.

Same individual

may be

Chairperson and

Managing

Director/ Chief

Executive Officer

90. (1) The remuneration of the directors shall, in so far as it consists of a

monthly payment, be deemed to accrue from day-to-day.

Remuneration

of director

(2) The remuneration payable to the directors, including any

managing or whole-time director or manager, if any, shall be

determined in accordance with and subject to the provisions of the

Act by an ordinary resolution passed by the Company in general

meeting.

Remuneration to

require members

consent

(3) In addition to the remuneration payable to them in pursuance

of the Act, the directors may be paid all travelling, hotel and other

expenses properly incurred by them—

a) in attending and returning from meetings of the

Board of Directors or any committee thereof or general

meetings of the Company; or

b) In connection with the business of the Company

Travelling and

other expenses

91. All cheques, promissory notes, drafts, hundis, bills of exchange and

other negotiable instruments, and all receipts for monies paid to the

Company, shall be signed, drawn, accepted, endorsed, or otherwise

executed, as the case may be, by such person and in such manner as the

Board shall from time to time by resolution determine.

Execution of

negotiable

Instruments

92. (1) Subject to the provisions of the Act, the Board shall have power

at any time, and from time to time, to appoint a person

as an additional director, provided the number of the directors

and additional directors together shall not at any time exceed

the maximum strength fixed for the Board by the Articles.

Appointment of

Additional

director

(2) Such person shall hold office only up to the date of the next Duration of office

306


annual general meeting of the Company but shall be eligible

for appointment by the Company as a director at that meeting

subject to the provisions of the Act.

of additional

director

93. (1) The Board may appoint an alternate director to act for a

director (hereinafter in this Article called “the Original

Director”) during his absence for a period of not less than

three months from India. No person shall be appointed as an

alternate director for an independent director unless he is

qualified to be appointed as an independent director under

the provisions of the Act

Appointment

of alternate

director

(2) An alternate director shall not hold office for a period longer

than that permissible to the Original Director in whose place

he has been appointed and shall vacate the office if and when

the Original Director returns to India.

Duration of office

of alternate

director

(3) If the term of office of the Original Director is determined

before he returns to India the automatic reappointment of

retiring directors in default of another appointment shall apply

to the Original Director and not to the alternate director.

Re-appointment

provisions

applicable

to Original

Director

94. (1) If the office of any director appointed by the Company in

general meeting is vacated before his term of office

expires in the normal course, the resulting casual vacancy

may, be called by the Board of Directors at a meeting of the

Board.

Appointment of

director to fill a

casual vacancy

(2) The director so appointed shall hold office only upto the

date upto which the director in whose place he is appointed

would have held office if it had not been vacated.

Duration of office

of Director

appointed to fill

casual vacancy

Power of Board

95. The management of the business of the Company shall be vested in the

Board and the Board may exercise all such powers, and do all such

acts and things, as the Company is by the memorandum of association or

otherwise authorized to exercise and do, and, not hereby or by the

statute or otherwise directed or required to be exercised or done by the

Company in general meeting but subject nevertheless to the provisions of

the Act and other laws and of the memorandum of association and

these Articles and to any regulations, not being inconsistent with the

memorandum of association and these Articles or the Act, from time to

time made by the Company in general meeting provided that no such

regulation shall invalidate any prior act of the Board which would have

been valid if such regulation had not been made.

General powers

of the Company

vested in Board

Proceeding of Board

96. (1) The Board of Directors may meet for the conduct of business,

adjourn and otherwise regulate its meetings, as it thinks fit.

When meeting to

be convened

(2) The Chairperson or any one Director with the previous consent

of the Chairperson may, or the company secretary on the

direction of the Chairperson shall, at any time, summon a

meeting of the Board.

Who may summon

Board meeting

(3) The quorum for a Board meeting shall be as provided in the

Act.

Quorum for board

meetings

(4) The participation of directors in a meeting of the Board may be

either in person or through video conferencing or audio visual

means or teleconferencing, as may be prescribed by the

Participation

at

Board meetings

307


Rules or permitted under law.

97. (1) Save as otherwise expressly provided in the Act, questions

arising at any meeting of the Board shall be decided by a

majority of votes.

Questions at

Board meeting

how decided

(2) In case of an equality of votes, the Chairperson of the Board,

if any, shall have a second or casting vote.

Casting vote of

Chairperson at

Board meeting

98. The continuing directors may act notwithstanding any vacancy in the

Board; but, if and so long as their number is reduced below the

quorum fixed by the Act for a meeting of the Board, the continuing

directors or director may act for the purpose of increasing the number of

directors to that fixed for the quorum, or of summoning a general meeting

of the Company, but for no other purpose.

Directors not to

act when number

falls below

minimum

99. (1) The Chairperson of the Company shall be the Chairperson at

meetings of the Board. In his absence, the Board may elect a

Chairperson of its meetings and determine the period for which he

is to hold of office.

Who to preside at

meetings of the

Board

(2) If no such Chairperson is elected, or if at any meeting the

Chairperson is not present within fifteen minutes after the time

appointed for holding the meeting, the directors present may choose

one of their number to be Chairperson of the meeting.

Directors to elect a

Chairperson

100. (1) The Board may, subject to the provisions of the Act, delegate

any of its powers to Committees consisting of such member

or members of its body as it thinks fit.

Delegation of

powers

(2) Any Committee so formed shall, in the exercise of the

powers so delegated, conform to any regulations that may be

imposed on it by the Board.

Committee to

conform to Board

regulations

(3) The participation of directors in a meeting of the Committee

may be either in person or through video conferencing or

audio visual means or teleconferencing, as may be prescribed

by the Rules or permitted under law.

Participation at

Committee

meeting

101. (1) A Committee may elect a Chairperson of its meetings unless the

Board, while constituting a Committee, has appointed a

Chairperson of such Committee.

Chairperson of

Committee

(2) If no such Chairperson is elected, or if at any meeting the

Chairperson is not present within fifteen minutes after the

time appointed for holding the meeting, the members

present may choose one of their members to be Chairperson

of the meeting.

Who to preside at

meetings of

Committee

102. (1) A Committee may meet and adjourn as it thinks fit. Committee meet

\ (2) Questions arising at any meeting of a Committee shall be

determined by a majority of votes of the members present. Questions at

Committee

meeting how

decided

(3) In case of an equality of votes, the Chairperson of the

Committee shall have a second or casting vote. Casting vote of

Chairperson at

Committee

meeting

103. All acts done in any meeting of the Board or of a Committee thereof or by

any person acting as a director, shall, notwithstanding that it may be

afterwards discovered that there was some defect in the appointment of

any one or more of such directors or of any person acting as aforesaid,

or that they or any of them were disqualified or that his or their

appointment had terminated, be as valid as if every such director or

such person had been duly appointed and was qualified to be a director.

Committee valid

notwithstanding

defect of

appointment

308


104. Save as otherwise expressly provided in the Act, a resolution in

writing, signed, whether manually or by secure electronic mode, by a

majority of the members of the Board or of a Committee thereof, for

the time being entitled to receive notice of a meeting of the Board or

Committee, shall be valid and effective as if it had been passed at a

meeting of the Board or Committee, duly convened and held.

Passing of

resolution by

circulation

Chief Executive officer, Manager, Company Secretary and

Chief financial Officer

105. a) Subject to the provisions of the Act,— A chief executive officer, manager, company

secretary and chief financial officer may be appointed

by the Board for such term, at such remuneration

and upon such conditions as it may think fit; and

any chief executive officer, manager, company

secretary and chief financial officer so appointed

may be removed by means of a resolution of the

Board; the Board may appoint one or more chief

executive officers for its multiple businesses

b) A director may be appointed as chief

executive officer, manager, company secretary or

chief financial officer.

Chief Executive

Officer, etc.

Director may be

Chief Executive

officer, etc.

Registers

106. The Company shall keep and maintain at its registered office all

statutory registers namely, register of charges, register of

members, register of debenture holders, register of any other security

holders, the register and index of beneficial owners and annual return,

register of loans, guarantees, security and acquisitions, register of

investments not held in its own name and register of contracts and

arrangements for such duration as the Board may, unless otherwise

prescribed, decide, and in such manner and containing such particulars

as prescribed by the Act and the Rules. The index of beneficial owners

shall also be in compliance with the Depositories Act, 1996 with details

of shares held in dematerialised forms in any medium as may be

permitted by law, including in any form of electronic medium

The registers and copies of annual return shall be open for inspection

during 11.00 a.m. to 1.00 p.m. on all working days, other than

Saturdays, at the registered office of the Company by the persons

entitled thereto on payment, where required, of such fees as may be fixed

by the Board but not exceeding the limits prescribed by the Rules.

107. (a) The Company may exercise the powers conferred on it by the

Act with regard to the keeping of a foreign register; and the

Board may (subject to the provisions of the Act) make and

vary such regulations as it may think fit respecting the

keeping of any such register

Foreign register

(b) The Company shall be entitled to keep in any country outside

India a branch register of beneficial owner residing outside India.

(c) The foreign register shall be open for inspection and may be

closed, and extracts may be taken therefrom and copies

thereof may be required, in the same manner, mutatis

mutandis, as is applicable to the register of members

The Seal

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108. (1) The Board shall provide for the safe custody of the seal.

(2) The seal of the Company shall not be affixed to any

instrument except by the authority of a resolution of the

Board or of a Committee of the Board authorised by it in

that behalf, and except in the presence of at least one

director or the manager, if any, or of the secretary or

such other person as the Board may appoint for the

purpose; and such director or manager or the secretary or

other person aforesaid shall sign every instrument to which

the seal of the Company is so affixed in their presence.

Dividend and Reserve

109. The Company in general meeting may declare dividends, but no

dividend shall exceed the amount recommended by the Board but the

Company in general meeting may declare a lesser dividend.

Company in

general meeting

may declare

Dividends

110. Subject to the provisions of the Act, the Board may from time to

time pay to the members such interim dividends of such amount on

such class of shares and at such times as it may think fit.

Interim dividends

111. (1) The Board may, before recommending any dividend, set aside

out of the profits of the Company such sums as it thinks fit as

a reserve or reserves which shall, at the discretion of the

Board, be applied for any purpose to which the profits of the

Company may be properly applied, including provision for

meeting contingencies or for equalising dividends; and

pending such application, may, at the like discretion, either be

employed in the business of the Company or be invested in

such investments (other than shares of the Company) as the

Board may, from time to time, think fit.

Dividends only to

be paid out of

profits

(2) The Board may also carry forward any profits which it

may consider necessary not to divide, without setting them

aside as a reserve.

Carry forward

of profits

112. (1) Subject to the rights of persons, if any, entitled to shares

with special rights as to dividends, all dividends shall be

declared and paid according to the amounts paid or credited

as paid on the shares in respect whereof the dividend is paid,

but if and so long as nothing is paid upon any of the shares in

the Company, dividends may be declared and paid according

to the amounts of the shares.

Division of

profits

(2) No amount paid or credited as paid on a share in advance of

calls shall be treated for the purposes of this Article as paid on

the share.

Payments in

advance

(3) All dividends shall be apportioned and paid

proportionately to the amounts paid or credited as paid on

the shares during any portion or portions of the period in

respect of which the dividend is paid; but if any share is

issued on terms providing that it shall rank for dividend as

from a particular date such share shall rank for dividend

accordingly

Dividend to be

apportioned

113. (1) The Board may deduct from any dividend payable to any

member all sums of money, if any, presently payable by

him to the Company on account of calls or otherwise in

relation to the shares of the Company.

No member to

receive dividend

whilst indebted to

the Company

and

Company’s

right to

reimbursement

therefrom

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(2) The Board may retain dividends payable upon shares in respect

of which any person is, under the Transmission Clause

hereinbefore contained, entitled to become a member, until such

person shall become a member in respect of such shares.

Retention

of dividends

114. (1) Any dividend, interest or other monies payable in cash in

respect of shares may be paid by electronic mode or by cheque

or warrant sent through the post directed to the registered

address of the holder or, in the case of joint holders, to the

registered address of that one of the joint holders who is first

named on the register of members, or to such person and to

such address as the holder or joint holders may in writing

direct.

Dividend

how remitted

(2) Every such cheque or warrant shall be made payable to the

order of the person to whom it is sent.

Instrument of

payment

(3) Payment in any way whatsoever shall be made at the risk of

the person entitled to the money paid or to be paid. The Company

will not be responsible for a payment which is lost or delayed.

The Company will be deemed to having made a payment and

received a good discharge for it if a payment using any of the

foregoing permissible means is made.

Discharge to

Company

115. Any one of two or more joint holders of a share may give effective

receipts for any dividends, bonuses or other monies payable in respect

of such share.

116. No dividend shall bear interest against the Company. No interest

on dividends

117. The waiver in whole or in part of any dividend on any share by any

document (whether or not under seal) shall be effective only if such

document is signed by the member (or the person entitled to the share

in consequence of the death or bankruptcy of the holder) and delivered

to the Company and if or to the extent that the same is accepted as such

or acted upon by the Board.

Waiver

of dividends

Accounts

118. (1) The books of account and books and papers of the Company, or any

of them, shall be open to the inspection of directors in accordance

with the applicable provisions of the Act and the Rules.

Inspection by

Directors

(2) No member (not being a director) shall have any right of inspecting

any books of account or books and papers or document of the

Company except as conferred by law or authorized by the Board.

Restriction on

inspection by

members

119. Subject to the applicable provisions of the Act and the Rules

made thereunder –

(a) If the Company shall be wound up, the liquidator

may, with the sanction of a special resolution of

the Company and any other sanction required by

the Act, divide amongst the members, in specie or

kind, the whole or any part of the assets of the

Company, whether they shall consist of property of

the same kind or not

(b) For the purpose aforesaid, the liquidator may set

such value as he deems fair upon any property to be

Winding up of

Company

311


divided as aforesaid and may determine how such

division shall be carried out as between the members

or different classes of members

(c) The liquidator may, with the like sanction, vest

the whole or any part of such assets in trustees

upon such trusts for the benefit of the contributories

if he considers necessary, but so that no member

shall be compelled to accept any shares or other

securities whereon there is any liability.

Indemnity and Insurance

120. (a) Subject to the provisions of the Act, every director,

managing director, whole-time director, manager, company

secretary and other officer of the Company shall be

indemnified by the Company out of the funds of the Company,

to pay all costs, losses and expenses (including travelling

expense) which such director, manager, company secretary

and officer may incur or become liable for by reason of any

contract entered into or act or deed done by him in his

capacity as such director, manager, company secretary or

officer or in any way in the discharge of his duties in such

capacity including expenses

(b) Subject as aforesaid, every director, managing director,

manager, company secretary or other officer of the Company

shall be indemnified against any liability incurred by him in

defending any proceedings, whether civil or criminal in which

judgement is given in his favour or in which he is acquitted or

discharged or in connection with any application under

applicable provisions of the Act in which relief is given to him

by the Court.

(c) The Company may take and maintain any insurance as the

Board may think fit on behalf of its present and/or former

directors and key managerial personnel for indemnifying all

or any of them against any liability for any acts in relation to

the Company for which they may be liable but have acted

honestly and reasonably.

Directors and

officers right to

indemnity

Insurance

General Power

121. Wherever in the Act, it has been provided that the Company shall

have any right, privilege or authority or that the Company could carry

out any transaction only if the Company is so authorized by its articles,

then and in that case this Article authorizes and empowers the

Company to have such rights, privileges or authorities and to carry out

such transactions as have been permitted by the Act, without there

being any specific Article in that behalf herein provided.

General Power

Applicable law

122. At any point of time from the date of adoption of these Articles, if the

Articles are or become contrary to the provisions of the Securities and

Exchange Board of India (Listing Obligations and Disclosure

Requirements) Regulations, 2015 (the “Regulations”), the provisions

of the Regulations shall prevail over the Articles to such extent and the

Company shall discharge all of its obligations as prescribed under the

Applicable law

312


Regulations, from time to time

313

SECTION X-OTHER INFORMATION

MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The following contracts (not being contracts entered into in the ordinary course of business carried on by our

Company or contracts entered into more than two (2) years before the date of filing of this Prospectus) which

are or may be deemed material have been entered or are to be entered into by our Company. These contracts,

copies of which will be attached to the copy of the Prospectus and will be delivered to the ROC for registration

and also the documents for inspection referred to hereunder, may be inspected at the Registered Office of our

Company located at, from the date of filing the Prospectus with RoC to Issue Closing Date on working days

from 11.00 a.m. to 5.00 p.m.

MATERIAL CONTRACTS

1) MOU dated July 28, 2018 between our Company and the Lead Manager.

2) MOU dated August 18, 2018 between our Company and the Registrar to the Issue.

3) Public Issue Account Agreement dated [•] among our Company, the Lead Manager, the Public Issue

Bank/Banker to Issue and the Registrar to the Issue.

4) Underwriting agreement dated [•] between our Company and Lead Manager, Mark Corporate Advisors Private

Limited and [•].

5) Market Making Agreement dated [•] between our Company, the Lead Manager and the Market Maker.

6) The Company has entered into tripartite agreement between NSDL, the Company and the Registrar to the

Issue May 03, 2018 .

7) The Company has entered into tripartite agreement between CDSL, the Company and the Registrar to the

Issue dated April 25, 2018.

MATERIAL DOCUMENTS

1) Certified true copy of the Memorandum and Articles of Association of our Company, as amended from

time to time including certificates of incorporation.

2) Resolution of the Board dated May 25, 2018 authorizing the Issue.

3) Special Resolution of the shareholders passed at the EGM dated June 08, 2018 authorizing the Issue.

4) Copies of Audited Financial Statements of our Company for the financial year ending March 31, 2018

March 31, March 31, 2017, March 31, 2016, March 31, 2015 and March 31, 2014.

5) Statement of Possible Tax Benefits dated August 13, 2018 issued by Statutory Auditors, Vijay Darji &

Associates, Chartered Accountants.

6) Report of the Peer Review Auditor, Vijay Darji & Associates, Chartered Accountants, on the Restated

Financial Statements for Financial Year ended as on March 31, 2018, March 31, 2017, March 31, 2016,

March 31, 2015 and March 31, 2014 of our Company.

7) Copy of Certificate from the Peer Review Auditors of our Company, Vijay Darji & Associates, Chartered

Accountants, dated August 13, 2018 regarding the Eligibility of the Issue.

8) Consents of Promoters, Directors, Company Secretary and Compliance Officer, Chief Financial Officer,

Statutory Auditors, Peer Review Auditor, Bankers to our Company, the Lead Manager, Underwriter,

Registrar to the Issue, Market Maker to the Issue, Legal Advisor, Banker to the Issue/Public Issue Bank to

the Issue, to act in their respective capacities.

9) Copy of approval from NSE vide letter dated [•] to use the name of NSE in the offer document for listing of

Equity Shares on NSE EMERGE.

10) Due Diligence Certificate dated September 10, 2018 issued by the Lead Manager i.e. Mark Corporate

Advisors Private Limited.

11) Copy of Certificate from the Statutory Auditor of our Company, Vijay Darji & Associates, Chartered

Accountants, regarding Source and Deployment of Funds as on August 13, 2018.

Any of the contracts or documents mentioned in this Prospectus may be amended or modified at any time if so

required in the interest of our Company or if required by other parties, subject to compliance of the provisions

contained in the Companies Act and other relevant statutes.

314

DECLARATION

We, the Directors, hereby certify and declare that, all relevant provisions of the Companies Act, 1956 /

Companies Act, 2013 (to the extent notified), and the guidelines issued by the Government of India or the

Regulations/Guidelines issued by Securities and Exchange Board of India, established under Section 3 of the

Securities and Exchange Board of India Act, 1992, as the case may be, have been complied with and no

statement made in the Draft Prospectus is contrary to the provisions of the Companies Act, 2013, applicable

provisions of Companies Act, 1956, the Securities and Exchange Board of India Act, 1992 or rules made there

under or regulations / guidelines issued, as the case may be. We further certify that all the disclosures and

statements made in the Draft Prospectus are true and correct.

Signed by the Directors of our Company:


Managing Director

DIN: 01154896

Sd/-

______________________________

Harpreet Singh Executive Director

DIN: 00834180

Sd/-

______________________________

Satish Kumar

Executive Director

DIN: 00763060

Sd/-

______________________________

Sanjay Dhir

Non-Executive Director

DIN: 02452461

Sd/-

______________________________

Swapan Chakraborty

Executive Director

DIN: 07184333

Sd/-

______________________________

Rajesh Shrivastava

Independent Non-Executive Director

DIN: 00155198

Sd/-

__________________________

Ashok Kumar Gupta


DIN: 07330108

Sd/-

______________________________

Manju Kandhari


DIN: 08132304

Sd/-

______________________________

Signed by the Chief Financial Officer & Company Secretary of our Company:

Sanjeev Kumar Kanwal

Chief Financial Officer Sd/-

sss______________________________

Sanjeev Kumar

Company Secretary & Compliance Officer Sd/-

______________________________

Place : Chandigarh

Date : September 10, 2018

PREET REMEDIES LIMITED

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Transcript of PREET REMEDIES LIMITED