INFORMATION MEMORANDUM MORNING GLORY LEASING AND FINANCE LIMITED

Transcription

1 INFORMATION MEMORANDUM OF MORNING GLORY LEASING AND FINANCE LIMITED 1

2 INFORMATION MEMORANDUM Date: MORNING GLORY LEASING AND FINANCE LIMITED Our Company was incorporated as a public limited company on 3 rd of August, 1984 with the name Morning Glory Leasing and Finance Limited under the jurisdiction of Registrar of Companies NCT of Delhi & Haryana. The Corporate Identification Number (CIN) of the Company is L67120DL1984PLC For more details of our company, see the section General Information. Registered and Corporate Office: IRIS House, 16 Business Centre, Nangal Raya, New Delhi Contact Person: Mr. Sanwar Mal Nai Telephone: ID: morninggloryleasing@gmail.com Website: INFORMATION MEMORANDUM FOR LISTING OF 2,49,000 EQUITY SHARES OF RS.10/-EACH FULLY PAID UP GENERAL RISKS Investment in equity and equity-related securities involve a degree of risk and investors should not invest in the equity shares of Morning Glory Leasing and Finance Limited 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 the shares of Morning Glory Leasing and Finance Limited. For taking an investment decision, investors must rely on their own examination of the Company including the risks involved. ABSOLUTE RESPONSIBILITY OF MORNING GLORY LEASING AND FINANCE LIMITED Morning Glory Leasing and Finance Limited having made all reasonable inquiries, accepts responsibilities for, and confirms that this Information Memorandum contains all information with regard to Morning Glory Leasing and Finance Limited, which are material, and that the information contained in this Information Memorandum are true and correct in all material aspects and are 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 Information Memorandum 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 of Morning Glory Leasing and Finance Limited are listed on the Delhi Stock Exchange Limited are proposed to be listed on Metropolitan Stock Exchange Of India Limited (MSEI) formerly known as MCX- SX Stock Exchange Limited (MCX-SX). REGISTRAR AND SHARE TRANSFER AGENT BIGSHARE SERVICES PRIVATE LIMITED Regd. Office Address: E-2 &3 Ansa Industrial Estate, Saki Vihar Road, Sakinaka Mumbai Maharashtra Corporate Office Address: 4E/8, First Floor, Jhandewalan Extension, New Delhi Tel. No.: Fax No.: bssdelhi@bigshareonline.com Contact Person: Mr. Prem Kumar 2

3 TABLE OF CONTENTS I. DEFINITIONS AND ABBREVIATIONS 4-6 II. GENERAL 7-8 Presentation Of Financial, Industry And Market Data 7 Forward Looking Statements 8 III. RISK FACTORS AND MANAGEMENT PERCEPTIONS THEREOF 9-12 IV. INTRODUCTION Summary of Business 13 Overview 13 Summary of Financial Information General Information Capital Structure V. ABOUT THE COMPANY Our History and certain Corporate Matters Our Management Our Promoters 38 Related Party Transactions 38 VI. FINANCIAL INFORMATION Financial Statements VII. OUTSTANDING LITIGATIONS VIII. LICENSE & GOVERNMENT APPROVALS 60 IX. PURPOSE OF LISTING X. OTHER INFORMATION 63 Material Contracts And Documents For Inspection 63 DECLARATION 64 3

4 SECTION I DEFINITIONS AND ABBREVIATIONS DEFINITIONS This Information Memorandum uses certain definitions and abbreviations, which unless the context indicates or implies otherwise, have the meanings as provided below. Reference to any legislation/s, act/s or regulation/s shall be to such legislation/s, act/s or regulation/s, as amended from time to time. General Terms Term Morning Glory Leasing and Finance Limited, MGLFL,, We or us or our Company or the Issuer Description Morning Glory Leasing and Finance Limited having its registered Office at IRIS House, 16 Business Centre, Nangal Raya, New Delhi Company Related Terms Term The Company or Morning Glory or "MGLFL" or we or us or our AOA/Articles/Articles of Association Auditors / Statutory Auditors Banker(s) to the Company Board of Directors/ Board/ Directors Director(s) Equity Shares Information Memorandum Key Managerial Personnel Memorandum/ Memorandum of Association/MOA MSEI Description Morning Glory Leasing and Finance Limited having its registered Office at IRIS House, 16 Business Centre, Nangal Raya, New Delhi Article of Association of the Company, as amended from time to time, unless the context otherwise specifies. The Statutory Auditors of the Company, M/s. Rattan Gupta & Co., Chartered Accountants. The Bankers of the Company, HDFC Bank Limited, New Delhi. The Board of Directors of the Company or a committee Constituted thereof, unless the context otherwise specifies. The director(s) of the Company, unless otherwise specified. Equity shares of the Company of face value of Rs. 10 each, fully paid up, unless otherwise specified in the context thereof. This document as filed with the Stock Exchange is known as and referred to as the Information Memorandum. The officers vested with executive powers and the officers at the level immediately below the board of directors of the issuer and include any other person whom the issuer may declare as key management personnel, in terms of Regulation 2(1)(s) of the SEBI ICDR Regulations. The Memorandum of Association of Morning Glory Leasing and Finance Limited Metropolitan Stock Exchange of India Limited Promoters Includes such persons and entities constituting our promoters in terms of Regulation 2 (1)(za) of the SEBI ICDR Regulations. Promoter Group Includes such persons and entities constituting our promoter group in terms of Regulation 2 (1)(zb) of the SEBI ICDR Regulations. Registered Office The registered office of the Company at IRIS House, 16 Business Centre, Nangal Raya, New Delhi

5 Registrar/ Registrar & Share Transfer Agent/RTA The Registrar & Share Transfer Agent of the Company, Bigshare Services Private Limited Listing Related Terms Allotment Term Description The allotment of Equity Shares pursuant to earlier Issues. Allottees Banker(s) to the Company Equity Listing Agreements Equity Shareholder(s) Registrar & Share Transfer Agent Persons to whom Equity Shares of our Company were issued pursuant to earlier Issues. HDFC Bank Limited, New Delhi. The listing agreements entered into between our Company and the Stock Exchanges. Holder(s) of Equity Shares of our Company as on the date of filling this Information Memorandum. Bigshare Services Private Limited ABBREVIATIONS Term Description Rs. or Rupees or INR Indian Rupee Act or Companies Act The Companies Act, 1956, and The Companies Act, 2013, as amended from time to Time. AGM Annual General Meeting. AS Accounting Standards issued by the Institute of Chartered Accountants of India. AY Assessment Year BIFR Board for Industrial and Financial Reconstruction. CG Central Government CIN Corporate Identification Number CDSL Central Depository Services (India) Limited Central Government The Central Government of India Companies Act Companies Act, 1956 and Companies Act, 2013 Depositories NSDL and CDSL Depositories Act A depository registered with the SEBI under the Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996 DIN Directors Identification Number DP/ID DP/ Depository Participant DSE EBITDA EGM EPS ESOP Financial year/fiscal/ FY Depository Participant Identity A depository participant as defined under the Depositories Act, 1996 Delhi Stock Exchange Limited Earnings Before Interest, Tax, Depreciation and Amortization Extraordinary General Meeting Earnings per Equity Share Employees Stock Option Scheme Period of twelve months ended March 31 of that particular year, unless otherwise stated 5

6 FDI GDP HUF IT Act Indian GAAP IPO ISO ISIN NA NAV NSDL p.a. P/E Ratio PAN PAT PBT RBI RBI Act ROC RSE SCORES SEBI SEBI Act SWOT State Government Takeover Regulations UIN Foreign Direct Investment Gross Domestic Product Hindu Undivided Family The Income-tax Act, 1961, as a mended from time to time, except as stated otherwise Generally Accepted Accounting Principles in India Initial Public Offer International Organisational for Standardisation International Securities Identification Number Not Applicable Net Asset Value being paid up equity share capital plus free reserves (excluding reserves created out of revaluation) less deferred expenditure not written off (including miscellaneous expenses not written off) and debit balance of Profit and Loss account, divided by number of issued Equity Shares National Securities Depository Limited per annum Price/Earnings Ratio Permanent Account Number allotted under the Income Tax Act, 1961 Profit after tax Profit before tax Reserve Bank of India The Reserve Bank of India Act, 1934, as amended Registrar of Companies, N.C.T. of Delhi & Haryana Regional Stock Exchange SEBI Complaints Redress System The Securities and Exchange Board of India constituted under the SEBI Act, 1992, as amended from time to time Securities and Exchange Board of India Act 1992, as amended from time to time Strength, Weakness, Opportunities and Threats of the Company The government of a state of the Union of India Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended Unique Identification Number 6

7 SECTION II GENERAL PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA Certain Conventions Unless otherwise specified or the context otherwise requires, all references to India in this Information Memorandum are to the Republic of India, together with its territories and possessions. Unless the context otherwise requires, all references to the "Company", "we", "us" and "our" refers to Morning Glory Leasing and Finance Limited. Financial Data Unless indicated otherwise, the financial data in this Information Memorandum is derived from the financial statements prepared in accordance with the Generally Accepted Accounting Principles in India ( Indian GAAP ) and the Companies Act, 1956, and the Companies Act, 2013 as amended ( Companies Act ) included elsewhere in this Information Memorandum. The financial year commences on April 1 st and ends on 31 st March, so all references to a particular financial year are to the twelve-month period ended 31 st March of that year. The Company publishes its financial statements in Indian Rupees. In this Information Memorandum, any discrepancies in any table between the total and the sums of the amounts listed are due to rounding off. Currency of Presentation All references to Rupees or INR are to Indian Rupees, the official currency of the Republic of India. Industry and Market Data Unless stated otherwise, industry data and the market data used throughout this Information Memorandum have been obtained from industry publications, websites and other authenticated published data. 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, the Company believes that industry data used in this Information Memorandum is reliable, it has not been independently verified. Similarly, internal company reports, while believed by us to be reliable, have not been verified by any independent sources. The extent to which the market and industry data used in this Information Memorandum is meaningful depends on the readers familiarity with the understanding of the methodologies used in compiling such data. There are no standard valuation methodologies or accounting policies in the said industry in India and methodologies and assumptions may vary widely among different industry sources. 7

8 FORWARD LOOKING STATEMENTS This Information Memorandum contains certain words or phrases, including, will, aim, will likely result, believe, expect, will continue, anticipate, estimate, intend, plan, contemplate, seek to, future, would, objective, goal, project, should, will pursue and similar expressions or variations of such expressions, that are forward-looking statements. All forward-looking statements are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. All forward looking statements are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those contemplated by the relevant forward looking statement. Important factors that could cause actual results to differ materially from our expectations include, among others: - General economic and business conditions in India and other countries. Our ability to successfully implement our strategy, our growth and expansion, our exposure to market risks that have an impact on our business activities or investments. The changes in monetary and fiscal policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices. The performance of the financial markets in India and globally, changes in domestic and foreign laws, regulations and taxes and changes in competition in our industry. Changes in the value of the Rupee and other currencies. The occurrence of natural disasters or calamities. Change in political and social conditions in India. The Loss or shutdown of operations of the Company at any time due to strike. The Loss of our key employees and Staff. Our ability to respond to technological changes. Material Contract The Company has not entered into any material contract or agreement other than those entered into the ordinary course of business. Absolute Responsibility of Morning Glory Leasing and Finance Limited Morning Glory Leasing and Finance Limited having made all reasonable inquiries, accepts responsibility for, and confirms that this Information Memorandum contains all information with regard to the Company, which is material, that the information contained in the Information Memorandum 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 Information Memorandum as a whole or any of such information or the expression of any such opinions are intentions misleading in any material respect. 8

9 SECTION III RISK FACTORS AND MANAGEMENT PERCEPTIONS THEREOF An investment in Equity Shares involves a high degree of risk. One should carefully consider all the information s in this Information Memorandum, including the risks and uncertainties described below, before making an investment in our Equity Shares. To obtain a complete understanding, this section should be read in conjunction with the section Our Business on as well as the other financial and statistical information contained in this Information Memorandum. The risks and uncertainties described in this section are not the only risks and uncertainties we currently face. Additional risks and uncertainties not known to us or the ones which we currently deem immaterial may also have an adverse effect on our business, financial condition and results of operations. For taking an investment decision, investors must rely on their own examination of the Company including the risks involved therein. Unless otherwise stated, the financial data used in this section has been derived from our Company's audited financial statements for the financial years ended on March 31, Internal Risk Factors 1. We face the risk of default and non-payment by borrowers and other counterparties. Any such defaults and non-payments would result in write-offs and/or provisions in our financial statements which may materially and adversely affect our profitability and asset quality Any lending activity is exposed to credit risk arising from the risk of default and nonpayment by borrowers and other counterparties. The size of our loan portfolio is expected to grow as a result of our expansion strategy. This will expose us to an increasing risk of defaults as our portfolio expands. The borrowers may default in their repayment obligations due to various reasons including insolvency, a lack of liquidity, and operational failure. 2. Company s inability to manage growth may lead to loss of opportunities and may hamper its future growth plans While the Company has been generally successful in execution of its business strategy in the past, the same may not hold true in future. Company may be subject to growth-related risks including capacity constraints and pressure on internal systems and controls. Company s inability to deal with such a growth could have a material adverse impact on its business, operations and prospects. In order to manage its current operations and any future growth effectively, it will need to continue to implement and improve it s operational, financial and management information systems and to hire, train, motivate, manage and retain its employees. There can be no assurance that it will be able to manage such growth effectively, that its management, personnel or systems will be adequate to support its operations or that it will be able to achieve the increased levels of revenue commensurate with the increased levels of operating expenses associated with such growth. Any failure on its part to scale up infrastructure and management to meet the challenges of rapid growth could cause disruptions to its business and could be detrimental to its long-term business prospects. 3. Company s success significantly depends on its management and operational teams and other skilled professionals. If it fails to retain, motivate and/or attract such personnel, its business may be unable to grow and its revenues could decline, which may decrease the value of our Equity Shares. Company is dependent on the senior members of its management and operational team for its continued success and growth. Its success depends on its ability to attract, train, motivate and retain highly skilled professionals. If it cannot hire and retain the qualified personnel, its ability to continue to expand may be impaired and its revenues could decline. 9

10 4. If the Company is not able to obtain, renew or maintain the permits and approvals required to operate its business, this may have a material adverse effect on its business. The Company requires certain permits and approvals to operate its businesses, including permits required by the environmental regulatory authorities. There can be no assurance that the relevant authorities will issue any such permits or approvals in the time-frame anticipated by the Company or at all. If the Company fails to renew, maintain or obtain the required permits and approvals, and licenses in a timely manner or at all, it would interrupt its operations. 5. 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 expire and for which we may have to make an application for obtaining the approval or its renewal. We will be applying for certain approvals relating to our business. If we fail to maintain such registrations and licenses or comply with applicable conditions, or a regulatory authority claims we have not complied, with these 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. Further, we may become liable to penal action if our activities are adjudged to be undertaken in the manner not authorized under the applicable law. This could materially and adversely affect our business, financial condition and results of operations. We cannot assure you that we will be able to obtain approvals in respect of such applications or any application made by us in the future. 6. If we are unable to retain the services of our Key Managerial Personnel, our business and our operating results could be adversely impacted. We are dependent on our Key Managerial Personnel for setting our strategic direction and managing our businesses. The loss of our key managerial personnel may materially and adversely impact our business, results of operations and financial condition. 7. Our inability to manage growth could disrupt our business and reduce our profitability. A principal component of our strategy is to continue to grow by expanding the size and geographical scope of our businesses, as well as the development of our new business streams. This growth strategy will place significant demands on our management, financial and other resources. It will require us to continuously develop and improve our operational, financial and internal controls. Continuous expansion increases the challenges involved in financial management, recruitment, training and retaining high quality human resources, preserving our culture, values and entrepreneurial environment, and developing and improving our internal administrative infrastructure. Any inability on our part to manage such growth could disrupt our business prospects, impact our financial condition and adversely affect our results of operations. 8. Major fraud, lapses of internal control or system failures could adversely impact the company s business. Our Company is vulnerable to risk arising from the failure of employees to adhere to approved procedures, system controls, fraud, system failures, information system disruptions, communication systems failure and interception during transmission through external communication channels or networks. Failure to protect fraud or breach in security may adversely affect our Company s operations and financial performance. Our reputation could also be adversely affected by significant fraud committed by our employees, agents, customers or third parties. 10

11 9. Our clients deal in securities and any default by a client could result in substantial losses. We require clients to deposit a minimum initial margin and then to pay the balance settlement amount by the pay in date for the transaction undertaken by us on their behalf. If a client is unable to pay this balance amount before the pay-in date, we may be required to make the payment on behalf of the defaulting client, which may affect our profitability. In case of high market volatility or adverse movements in share price, it is possible that clients may not honor their commitment, and any inability on our part to pay the margins to the Stock Exchanges may be detrimental to our business, reputation and profitability. External Risk Factors 1. Tax rates applicable to Our Company may increase and may have an adverse impact on our business Any increase in the tax rates may have an adverse impact on our business and results of operations and we can provide no assurance as to the extent of the impact of such changes. 2. All of our revenue is derived from business in India and a decrease in economic growth in India could cause our business to suffer We derive all of our revenue from our operations in India and, consequently, our performance and the quality and growth of our business are dependent on the health of the economy of India. However, the Indian economy may be adversely affected by factors such as adverse changes in liberalization policies, social disturbances, terrorist attacks and other acts of violence or war, natural calamities or interest rates changes, which may also affect the microfinance industry. Any such factor may contribute to a decrease in economic growth in India which could adversely impact our business and financial performance. 3. We are subject to fluctuations in interest rates and other market risks, which may materially and adversely affect our financial condition and results of operations Our business substantially depends on interest income from operations. Market risk refers to the probability of variations in our interest income or in the market value of our assets and liabilities due to interest rate volatility. Changes in interest rates affect our interest income and the volume of loans we issue. Increases in short-term interest rates could increase our cost of borrowing and adversely affect our profitability. When interest rates rise, we must pay higher interest on our borrowings while interest earned on our assets does not rise as quickly because our loans are issued at fixed interest rates. Interest rate increases could result in adverse changes in our interest income, reducing our growth rate and the value of our financial assets. 4. Changing laws, rules and regulations and legal uncertainties, including adverse application of tax laws and regulations, may adversely affect our business and financial performance Our business and financial performance could be adversely affected by unfavorable changes in or interpretations of existing, or the promulgation of new, laws, rules and regulations applicable to us and our business, including those relating to consumer protection, Internet and privacy. There can be no assurance that the Government may not implement new regulations and policies which will require us to obtain approvals and licenses from the Government and other regulatory bodies or impose onerous requirements and conditions on our operations. Any such changes and the related uncertainties with respect to the implementation of the new regulations may have a material adverse effect on our business, financial condition and results of operations. In addition, we may have to incur capital expenditures to comply with the requirements of any new regulations, which may also materially harm our cash flows and in turn affect our results of operations. 11

12 5. Civil unrest, acts of violence including terrorism or war involving India and other countries could materially and adversely affect the financial markets and our business. Any major hostilities involving India or other acts of violence, including civil unrest or similar events that are beyond our control, could have a material adverse effect on India s economy and our business. Terrorist attacks and other acts of violence may adversely affect the Indian stock markets, where our Equity Shares will trade, and the global equity markets generally. 6. Any downgrading of India s debt rating by a domestic or international rating agency could adversely affect our Company s business. Any adverse revisions to India s credit ratings for domestic and international debt by domestic or international rating agencies may adversely affect our Company s ability to raise additional financing, and the interest rates and other commercial terms at which such additional financing is available. This could harm our Company s business and financial performance, ability to obtain financing for capital expenditures and the price of our Company s Equity Shares. 12

13 SECTION IV INTRODUCTION SUMMARY OF BUSINESS In this section, unless the context requires otherwise, any reference to we, our and us refers to the Company. OVERVIEW Our Company was incorporated as a public limited company on 3 rd of August, 1984 with the name Morning Glory Leasing and Finance Limited under the jurisdiction of Registrar of Companies NCT of Delhi & Haryana. The Corporate Identification Number (CIN) of the Company is L67120DL1984PLC The Authorized Capital of the Company is Rs. 40,00,000 and Paid-up Capital is Rs. 24,90,

14 SUMMARY OF FINANCIAL INFORMATION The following table provides a summary of financial information derived from the financial statements as of and for the financial year These financial statements have been prepared in accordance with the Indian GAAP and the Companies Act, The summary of financial information presented below should be read in conjunction with the financial statements, the notes and annexure thereto provided with this information memorandum. Statement of Assets and Liabilities Particulars Non-current assets Non-Current Investment 1,02,28,941 38,78,911 67,48,589 (Fig. Rs.) Fixed Assets - 47,313 52,569 Total Non-current assets 1,02,28,941 39,26,224 68,01,158 Current Assets Trade Receivable - 62,15,275 - Short-term Loans and Advances 6,28,410 5,38,978 1,45,563 Cash & Cash Equivalents 8,836 5,302 1,45,563 Total Current Assets 6,37,246 67,59,555 1,52,510 TOTAL ASSETS 1,08,66,187 1,06,85,779 69,53,668 Non-current Liabilities Long-term Borrowings Total Non-Current Liabilities Current Liabilities Short-term Provisions 1,03,230 5,56,453 - Sundry Creditors / Trade Payables 17,000 9,000 8,427 Other Current Liabilities 50,241 21,648 25,625 Total Current Liabilities 1,70,471 5,87,101 34,052 Net Worth Share Capital 24,90,000 24,90,000 24,90,000 Reserve & Surplus 82,05,716 76,08,678 44,29,616 Total Net Worth 1,06,95,716 1,00,98,678 69,19,616 TOTAL LIABILITIES 1,08,66,187 1,06,85,779 69,53,668 14

15 Statement of Profit and Loss Account (Fig. Rs.) Particulars Income Income from Operations 2,88,572 4,92,373 5,54,789 Other Income 5,28,296 28,45,830 - Total 8,16,868 33,38,203 5,54,789 Expenditure Employee benefit expense 74,406 34, ,489 Depreciation and amortization Expense 5,436 5,256 9,341 Other Expenses 1,33,137 94,563 1,76,973 Total 2,12,979 1,34,719 2,74,803 Profit before tax 6,03,889 32,03,484 2,79,986 Less: Provision for Tax 1,03,230 5,56,453 14,233 Add: MAT credit Entitlement 96,379 5,32,031 - Add: Income tax for earlier years written back Profit after tax 5,97,038 31,79,062 2,66,314 Earnings Per Share Basic Diluted

16 Statement of Cash Flow Statement (Fig. Rs.) Particulars Cash flow from operating activities: Net profit/loss before tax 6,03,889 32,03,484 2,79,986 Adjustment for: Depreciation 5,256 9,341 Interest Paid Loss/ (Profit) on sale of Fixed Assets/ Investments (5,27943) (28,45,830) 61,867 Dividend received on Investment (1,29,104) (3,40,498) (3,28,184) Interest Received Other Income Operating Cash flows before working Capital changes (47,722) 22,412 23,010 Changes in Working Capital: Increase/ (Decrease) in Trade and Other Receivable 61,25,843 (67,47,306) 1,66,495 Increase/ (Decrease) in Trade Payables (4,16,630) 5,42,138 (1,06,220) Cash generated from operations Net income tax (paid) / refunds (6,851) (13,511) (13,672) Net cash generated from /(used in) operating activities [A] 56,54,640 (61,96,267) 69,604 Cash flows from investing activities: Purchase of Investments (65,71,430) (4,99,900) (5,43,404) Sale of Investments 7,91,220 62,15,408 25,000 Dividend on Investment Received 1,29,104 3,40,498 3,28,184 Interest Received Other income Net cash used in investing activities [B] (56,51,106) 60,56,006 (1,90,220) Cash flows from financing activities: Change in Unsecured Loans Interest Paid Net cash generated from / (used in) financing activities [C] Net increase / (decrease) in cash and cash equivalents [A+B+C] 3,534 (1,40,261) (1,20,616) Cash and cash equivalents at the beginning of the year / period 5,302 1,45,563 2,661,179 Cash and cash equivalents at the end of the year / period 8,836 5,302 1,

17 GENERAL INFORMATION CORPORATE IDENTIFICATION NUMBER (CIN) L67120DL1984PLC REGISTERED OFFICE OF THE COMPANY IRIS House, 16 Business Centre, Nangal Raya, New Delhi TELEPHONE ID WEBSITE REGISTRAR OF COMPANIES N.C.T. of Delhi & Haryana, 4 th Floor, IFCI Tower, Nehru Place, New Delhi BOARD OF DIRECTORS Name of the Directors Category DIN Address Anil Agarwal Director Orient Ceramics & Industries Ltd., 8, Industrial Area, Sikandrabad, Uttar Rajesh Bagri Managing Director WZ-64A/3, 2nd Floor, S P Mukherjee Park, Tilak Nagar, New Delhi, Roma Monisha Sakraney Daga Director D-1/6, Vasant Vihar, New Delhi, Yogesh Mendiratta Director , Pocket D-12, Sector - 8, Rohini, Delhi Sanjiv Kumar Sharma Director /15, Gali Dispensory Wali, Pahar Ganj, New Delhi Sanwar Mal Nai Director Ward No 29 Kalu Bass, Near Dadhe Mata Mandir, Sri Dungargarh, Bikaner, Rajasthan Compliance Officer MS. ROMA MONISHA SAKRANEY DAGA D-1/6, Vasant Vihar, New Delhi, Telephone No. : Share Transfer Agents BIGSHARE SERVICES PRIVATE LIMITED Regd. Office Address: E-2 &3 Ansa Industrial Estate, Saki Vihar Road, Sakinaka, Mumbai Corporate Office Address: 4E/8, First Floor, Jhandewalan Extension, New Delhi Tel. No.: Fax No.: bssdelhi@bigshareonline.com Contact Person: Mr. Prem Kumar 17

18 Bankers To The Company HDFC Bank Limited, New Delhi Statutory Auditors Rattan Gupta & Co. FRN: 304N Partner: Rattan Gupta M.NO.: CAPITAL STRUCTURE Our share capital as of the date of this Information Memorandum is set forth below: Sr. No. Particulars Aggregate Nominal Value (Rs.) A Authorized Share Capital: 4,00,000 equity shares of Rs. 10 each 40,00,000 B Issued, Subscribed and Paid up Capital 2,49,000 equity shares of Rs. 10 each fully paid up 24,90,000 Build up History of Paid-up Capital Date of Allotment/ Fully Paid Up Incorporation No. of Equity Shares allotted Face Value (In Rs.) Issue Price (In Rs.) Nature of Allotment Cumulative number of equity shares Cumulative Paid-up Capital (In Rs.) Conside ration Subscriber Cash ,48, IPO 2,49,000 24,90,000 Cash CONVERTIBLE INSTRUMENTS / WARRANTS The Company has not issued any Convertible instrument including warrants till now. 18

19 Shareholding pattern as per clause 35 of the Listing Agreement as on Introductory sub-table (I)(a) Name of the Company: MORNING GLORY LEASING AND FINANCE LIMITED Name of the scrip, class of security: 4581; Equity LIST OF SHAREHOLDERS AS ON Partly paid-up shares:- No. of partly paidup shares As a % of total no. of partly paid-up shares As a % of total no. of shares of the company Held by promoter/promoter group Held by public Total D Outstanding convertible securities:- No. of outstanding securities As a % of total no. of outstanding convertible securities As a % of total no. of shares of the company, assuming full conversion of the convertible securities Held by promoter/promoter group Held by public Total E Warrants:- No. of warrants As a % of total no. of warrants As a % of total no. of shares of the company, assuming full conversion of warrants Held by promoter/promoter group Held by public Total F Total paid-up capital of the company, assuming full conversion of warrants and convertible securities 2,49,000 Shares of Rs. 10/- each 19

20 Categ ory code Category of Shareholder Statement Showing Shareholding Pattern Table (I)(a) Total number of shares Number of Sharehol ders Number of shares held in demateri alized form Total shareholding as a percentage of total number of shares Shares Pledged or otherwise encumbered As a % As a % of Number As a % of(a+b) 1 (A+B+C) of shares (I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX)= (VIII)/ (A) Shareholding of Promoter and Promoter Group 2 1 Indian (a) Individuals/ Hindu Undivided Family (b) Central Government/ State Government(s) (c) Bodies Corporate (d) Financial Institutions/ Banks (e) Any Others(Specify) (IV)*100 Sub Total(A)(1) Foreign A Individuals (Non- Residents Individuals/ Foreign Individuals) B Bodies Corporate C Institutions D Any Others(Specify) Sub Total(A)(2) Total Shareholding of Promoter and Promoter Group (A)= (A)(1)+(A)(2) (B) Public shareholding 1 Institutions (a) Mutual Funds/ UTI

21 (b) Financial Institutions / Banks (c) Central Government/ State Government(s) (d) Venture Capital Funds (e) Insurance Companies (f) Foreign Institutional Investors (g) Foreign Venture Capital Investors (h) Any Other (specify) Sub-Total (B)(1) B 2 Non-institutions (a) Bodies Corporate (b) Individuals I Individuals -i. Individual shareholders holding nominal share capital up to Rs 1 lakh II ii. Individual shareholders holding nominal share capital in excess of Rs.1 lakh (c) Any Other (specify) Sub-Total (B)(2) (B) Total Public Shareholding (B)= (B)(1)+(B)(2) TOTAL (A)+(B) (C) Shares held by Custodians and against which Depository Receipts have been issued 1 Promoter and Promoter Group Public Sub-Total (C ) A GRAND TOTAL (A)+(B)+(C)

22 Sr. No. Statement showing holding of securities (including shares, warrants, convertible securities) of persons belonging to the category Promoter and Promoter Group Name of the Details of Shares Encumbered shareholder held shares (*) Details of warrants Details of convertible securities Total shares (including underlyin g shares assuming full conversio n of warrants and convertibl e securities) as a % of diluted share capital Number of shares held As a % of grand total (A) +(B) + ( C ) (I) (II) (III) (IV) (V) 1 M.K.Daga (HUF) Sarla Daga Madhur Daga No. As a percent age (VI)= (V)/(III) *100 As a % of grand total (A)+(B) +(C) of subclause (I)(a ) (VII) No. of warr ants held (VIII ) As a No. of % converti total ble no. of securitie warra s nts held of the same class As a % total no.of convert ible securiti es of the same class (IX) (X) (XI) (XII) IRIS Designs Private Limited 5 Alfa Mercantile Limited 6 Freesia Investment and Trading Company Limited TOTAL 1,50, (*) The term encumbrance has the same meaning as assigned to it in regulation 28(3) of the SAST Regulations,

23 (I) (c)(i) Statement showing holding of securities (including shares, warrants, convertible securities) of persons belonging to the category Public and holding more than 1% of the total number of shares Sr. No. Name of the shareholder Number of shares held Shares as a % of total no. of shares {i.e., Grand Total (A)+(B)+ (C) indicated in Statement at para (I)(a) above Details of warrants No. of warrants held As a % total no. of warrant s of the same class Details of convertible securities No. of converti ble securiti es held % w.r.t total no. of conver tible securit ies of the same class 1. Ramesh Kumar Jain TOTAL Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital (I)(c) (ii) Sr. No. 1. Statement showing holding of securities (including shares, warrants, convertible securities) of persons (together with PAC) belonging to the category Public and holding more than 5% of the total number of shares of the company Name(s) of the shareholder(s) and the Persons Acting in Concert (PAC) with them Number of shares Shares as a percentage of total number of shares {i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (I)(a) above} Details of warrants Number of warrants As a % total numb er of warra nts of the same class Details of convertible securities Numbe r of conver tible securiti es held % w.r.t total numb er of conver tible securit ies of the same class Ramesh Kumar Jain TOTAL Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital 23

24 (I)(d) Sr. No. Statement showing details of locked-in shares Name of the shareholder NIL Number of locked-in shares Locked-in shares as a percentage of total number of shares {i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (I)(a) above} (II) (a) Statement showing details of Depository receipts (DRs) Sr. No. Type of outstanding DR (ADRs, GDRs, SDRs, etc.) Number of outstanding DRs Shares underlying outstanding DRs as a percentage of total number of shares {i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (1)(a) above} NIL (II) (b) Statement showing Holding of Depository Receipts (DRs), where underlying shares held by 'promoter / promoter group' are in excess of 1% of the total number of shares Sr. No. Name of the DR holder Type of Number of outstanding DR shares (ADRs, GDRs, underlying SDRs, etc. outstanding DRs Shares underlying outstanding DRs as a percentage of total number of shares{i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (1) (a) above} Nil 24

25 Shareholding pattern as per clause 35 of the Listing Agreement as on Introductory sub-table (I)(a) Name of the Company: MORNING GLORY LEASING AND FINANCE LIMITED Name of the scrip, class of security: 4581; Equity LIST OF SHAREHOLDERS AS ON Partly paid-up shares:- No. of partly paidup shares As a % of total no. of partly paid-up shares As a % of total no. of shares of the company Held by promoter/promoter group Held by public Total D Outstanding convertible securities:- No. of outstanding securities As a % of total no. of outstanding convertible securities As a % of total no. of shares of the company, assuming full conversion of the convertible securities Held by promoter/promoter group Held by public Total E Warrants:- No. of warrants As a % of total no. of warrants As a % of total no. of shares of the company, assuming full conversion of warrants Held by promoter/promoter group Held by public Total F Total paid-up capital of the company, assuming full conversion of warrants and convertible securities 2,49,000 Shares of Rs. 10/- each 25

26 Categ ory code Category of Shareholder Statement Showing Shareholding Pattern Table (I)(a) Total number of shares Number of Sharehol ders Number of shares held in demateri alized form Total shareholding as a percentage of total number of shares Shares Pledged or otherwise encumbered As a % As a % of Number As a % of(a+b) 1 (A+B+C) of shares (I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX)= (VIII)/ (A) Shareholding of Promoter and Promoter Group 2 1 Indian (a) Individuals/ Hindu Undivided Family (b) Central Government/ State Government(s) (c) Bodies Corporate (d) Financial Institutions/ Banks (e) Any Others(Specify) (IV)*100 Sub Total(A)(1) Foreign A Individuals (Non- Residents Individuals/ Foreign Individuals) B Bodies Corporate C Institutions D Any Others(Specify) Sub Total(A)(2) Total Shareholding of Promoter and Promoter Group (A)= (A)(1)+(A)(2) (B) Public shareholding 1 Institutions (a) Mutual Funds/ UTI

27 (b) Financial Institutions / Banks (c) Central Government/ State Government(s) (d) Venture Capital Funds (e) Insurance Companies (f) Foreign Institutional Investors (g) Foreign Venture Capital Investors (h) Any Other (specify) Sub-Total (B)(1) B 2 Non-institutions (a) Bodies Corporate (b) Individuals I Individuals -i. Individual shareholders holding nominal share capital up to Rs 1 lakh II ii. Individual shareholders holding nominal share capital in excess of Rs.1 lakh (c) Any Other (specify) Sub-Total (B)(2) (B) Total Public Shareholding (B)= (B)(1)+(B)(2) TOTAL (A)+(B) (C) Shares held by Custodians and against which Depository Receipts have been issued 1 Promoter and Promoter Group Public Sub-Total (C ) A GRAND TOTAL (A)+(B)+(C)

28 Sr. No. Statement showing holding of securities (including shares, warrants, convertible securities) of persons belonging to the category Promoter and Promoter Group Name of the Details of Shares Encumbered shareholder held shares (*) Details of warrants Details of convertible securities Total shares (including underlyin g shares assuming full conversio n of warrants and convertibl e securities) as a % of diluted share capital Number of shares held As a % of grand total (A) +(B) + ( C ) (I) (II) (III) (IV) (V) 1 M.K.Daga (HUF) Sarla Daga Madhur Daga No. As a percent age (VI)= (V)/(III) *100 As a % of grand total (A)+(B) +(C) of subclause (I)(a ) (VII) No. of warr ants held (VIII ) As a No. of % converti total ble no. of securitie warra s nts held of the same class As a % total no.of convert ible securiti es of the same class (IX) (X) (XI) (XII) IRIS Designs Private Limited 5 Alfa Mercantile Limited 6 Freesia Investment and Trading Company Limited TOTAL 1,50, (*) The term encumbrance has the same meaning as assigned to it in regulation 28(3) of the SAST Regulations,

29 (I) (c)(i) Statement showing holding of securities (including shares, warrants, convertible securities) of persons belonging to the category Public and holding more than 1% of the total number of shares Sr. No. Name of the shareholder Number of shares held Shares as a % of total no. of shares {i.e., Grand Total (A)+(B)+ (C) indicated in Statement at para (I)(a) above Details of warrants No. of warrants held As a % total no. of warrant s of the same class Details of convertible securities No. of converti ble securiti es held % w.r.t total no. of conver tible securit ies of the same class 1. Ramesh Kumar Jain TOTAL Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital (I)(c) (ii) Sr. No. 1. Statement showing holding of securities (including shares, warrants, convertible securities) of persons (together with PAC) belonging to the category Public and holding more than 5% of the total number of shares of the company Name(s) of the shareholder(s) and the Persons Acting in Concert (PAC) with them Number of shares Shares as a percentage of total number of shares {i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (I)(a) above} Details of warrants Number of warrants As a % total numb er of warra nts of the same class Details of convertible securities Numbe r of conver tible securiti es held % w.r.t total numb er of conver tible securit ies of the same class Ramesh Kumar Jain TOTAL Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital 29

30 (I)(d) Sr. No. Statement showing details of locked-in shares Name of the shareholder NIL Number of locked-in shares Locked-in shares as a percentage of total number of shares {i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (I)(a) above} (II) (a) Statement showing details of Depository receipts (DRs) Sr. No. Type of outstanding DR (ADRs, GDRs, SDRs, etc.) Number of outstanding DRs Shares underlying outstanding DRs as a percentage of total number of shares {i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (1)(a) above} NIL (II) (b) Statement showing Holding of Depository Receipts (DRs), where underlying shares held by 'promoter / promoter group' are in excess of 1% of the total number of shares Sr. No. Name of the DR holder Type of Number of outstanding DR shares (ADRs, GDRs, underlying SDRs, etc. outstanding DRs Shares underlying outstanding DRs as a percentage of total number of shares{i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (1) (a) above} Nil 30

31 LIST OF TOP 10 SHAREHOLDERS AS ON DATE ( ) Sr. No. Name of the Shareholder No. of Shares % of Shares 1. Alfa Mercantile Ltd IRIS Designs Ltd Freesia Investment & Trading Co. Ltd M.K. Daga (HUF) Madhur Daga Sarla Daga Ramesh Kumar Jain Girdhari Lal Goyal Surender Kumar Jain Sikhar Chand Jain Disclosures: TOTAL No dividend and Cash Bonus has been paid during the last 10 years. 2. T he Company has not entered into any agreements (including agreements for technical advice and collaboration), concessions and similar other documents (except those entered into in the ordinary course of business carried on or intended to be carried on by the company). 3. No commission, brokerage, discount or other special terms including an option for the issue of any kind of securities has been granted to any person. 4. T h ere are no outstanding warrants which are pending for conversion. 31