SIDDARTH BUSINESSES LIMITED

Transcription

1 INFORMATION MEMORANDUM OF SIDDARTH BUSINESSES LIMITED (A Public originally Company incorporated as Wisdom Investments Private Limited on 12th May, 1983 under Companies Act, 1956) Registered Office D-153A, IIIrd Floor, Okhla Industrial Area, Phase I, New Delhi Tel Id: Contact Person: Ms. Deepa Gupta, Compliance Officer, Mr. Sudharshan Jha, Director INFORMTION MEMORANDUM FOR THE LISTING OF EQUITY SHARES OF Rs. 10 Each General Risk Issuers Responsibility Investment in equity and equity related securities involve a degree of risk and investors should not invest in the equity of Siddarth Businesses 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 the Company. For taking an investment decision, investors must rely on their own examination of the Company including the risks involved. The Company, 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 this Information Memorandum is true and correct in all material respects, 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 entire issued Share Capital i.e. 45,65,000 Equity Shares having face value of Rs. 10/- each of the Company is listed on Delhi Stock Exchange Limited. Now the Company proposes to list the equity shares on the BSE Limited. REGISTRAR AND SHARE TRANSFER AGENT ADVISORS SKYLINE FINANCIAL SERVICES PRIVATE LIMITED D-153A, IST FLOOR, OKHLA INDUSTRIAL AREA PHASE I, NEW DELHI CONTACT PERSON- MR. VIRENDER RANA CONTACT NUMBER /03 CORPORATE CAPITALVENTURES PRIVATE LIMITED 2/11B, BASEMENT, JUNGPURA BLOCK-A, NEW DELHI CONTACT PERSON- MR. YASHLOK DUBEY CONTACT NUMBER CORPCAPITALS@GMAIL.COM 1

2 TABLE OF CONTENTS TITLE I. General Page No. 1. Definitions and Abbreviations 2 2. Presentation of Financial, Industry and Market data 3 3. Forward Looking Statements 4 II. Risk Factors Internal Risk 6 External Risk 9 III. Introduction 1. Summary of our Industry Summary of our Business Summary of Financial information General Information Capital Structure Shareholding Pattern 22 IV. About the Company 1. History of Company Key/Major Events Industry Overview Our Business Our Management Corporate Governance Our Promoters Dividend Policy 45 V. Regulations and Policies in India 46 VI. Financial Information 1. Statement of Assets and liabilities Statement of Profit & Loss liabilities Cash Flow Statement Financial Indebtedness Stock Market Data of our Equity Shares Statement of Dividend Related Party Transaction Management Discussion and Analysis Report 53 VII. Legal & Other Information 57 VIII. Main Provisions of the Articles of Association 58 IX. Declaration 76 2

3 I. GENERAL 1. Definition and Abbreviations Unless the context otherwise indicates, the following terms have the meanings given below. References to statutes, rules, regulations, guidelines and policies will be deemed to include all amendments and modifications notified thereto. In this Information Memorandum, unless the context otherwise indicates, all references to SBL, the Company, our Company are to Siddarth Businesses Limited, a company incorporated in India under the Companies Act, 1956 (the Companies Act ) with its Regis tered Office at D-153A, IIIrd Floor, Okhla Industrial Area, Phase I, New Delhi Furthermore, all references to the terms we, us and our are to Siddarth Businesses Limited. Company/ Industry related terms Term Description Act/Companies Act The Companies Act, 1956 And Companies Act, 2013 to the extent applicable including any statutory amendment or re-enactment thereof. AGM Annual General meeting Articles/Articles of Association Articles of Association of the Company AS Accounting Standards as issued by the Institute of Chartered Accountants of India Auditor Goel Mintri & Associates Board/Board of Directors of the Board of Directors of our Company i.e. Siddarth Businesses Company Limited BSE BSE Limited Capital/ Share Capital/Equity Share Capital Equity Share Capital of the Company CDSL Central Depository Services (India) Limited DP Depository Participant Depository The Depositories Act, 1996 and amendment thereto. DSE Delhi Stock Exchange Limited Equity Share(s) or Share(s) Means the equity shares of the Company having a face value of Rs. 10/- unless specified otherwise in the context thereof. Equity Shareholder Means a holder of equity shares. FEMA Foreign Exchange Management Act, 1999 and amendment thereto Financial Year/Fiscal/FY Period of 12 month ended on March 31 of that particular year unless stated otherwise. Memorandum/Memorandum of Association Memorandum of Association of the Company PMLA The Prevention of Money Laundering Act, 2002 Promoter(s) Mr. Siddarth Jalan and Ms. Swaranlata Jalan Promoter Group Unless the context otherwise requires, refers to such person who constitute the promoter group of our Company. RBI Reserve Bank of India Registrar of Company, NCT of Delhi and Haryana, New ROC Delhi T.P. Transfer of Property Act, 1882 SEBI Securities and Exchange Board of India Stock Exchange Shall refer to the BSE Limited Where the Shares of the Company proposed to list. Act/Companies Act The Companies Act, 1956 And Companies Act, 2013 to the extent applicable including any statutory amendment or re-enactment thereof. 3

4 AGM Annual General meeting Articles/Articles of Association Articles of Association of the Company AS Accounting Standards as issued by the Institute of Chartered Accountants of India Auditor Goel Mintri & Associates Board/Board of Directors of the Board of Directors of our Company i.e. Siddarth Businesses Company Limited BSE BSE Limited Capital/ Share Capital/Equity Share Capital Equity Share Capital of the Company CDSL Central Depository Services (India) Limited DP Depository Participant Depository The Depositories Act, 1996 and amendment thereto. DSE Delhi Stock Exchange Limited Equity Share(s) or Share(s) Means the equity shares of the Company having a face value of Rs. 10/- unless specified otherwise in the context thereof. Equity Shareholder Means a holder of equity shares. FEMA Foreign Exchange Management Act, 1999 and amendment thereto Financial Year/Fiscal/FY Period of 12 month ended on March 31 of that particular year unless stated otherwise. Memorandum/Memorandum ofassociation Memorandum of Association of the Company PMLA The Prevention of Money Laundering Act, 2002 Promoter(s) Mr. Siddarth Jalan and Ms. Swaranlata Jalan Promoter Group Unless the context otherwise requires, refers to such person who constitute the promoter group of our Company. RBI Reserve Bank of India ROC Registrar of Company, NCT of Delhi and Haryana, New Delhi T.P. Transfer of Property Act, 1882 SEBI Securities and Exchange Board of India Stock Exchange Shall refer to the BSE Limited Where the Shares of the Company proposed to list. The words and expressions used but not defined herein shall have the same meaning as is assigned to such terms under the Companies Act, the Securities Contracts (Regulation) Act, 1956, the Depositories Act, 1996 (the Depositories Act ) and the rules and regulations made there under. PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA Financial Data Unless stated otherwise, the financial data in the Information Memorandum is derived from our audited financial statements for the period ended March 31, 2009, 2010, 2011, 2012 and 2013 prepared in accordance with Indian GAAP, the Companies Act and in accordance with the SEBI ICDR Regulations and the Indian GAAP which are included in the Information Memorandum, and set out in the section titled Financial Information of the Information Memorandum. Our Financial Year commences on April 1 and ends on March 31 of the following year, so all references to a particular Financial Year are to the twelve-month period ended March 31 of that year. In the Information Memorandum, discrepancies in any table, graphs or charts between the total and the sums of the amounts listed are due to rounding-off. 4

5 There are significant differences between Indian GAAP, IFRS and U.S. GAAP. Our Company has not attempted to explain those differences or quantify their impact on the financial data included herein, and the investors should consult their own advisors regarding such differences and their impact on the financial data. Accordingly, the degree to which financial statements included in the Information Memorandum will provide meaningful information is entirely dependent on the reader's level of familiarity with Indian accounting practices. Any reliance by persons not familiar with Indian accounting practices on the financial disclosures presented in the Information Memorandum should accordingly be limited. Any percentage amounts, as set forth in the sections / chapters titled Risk Factors, Our Business and Management's Discussion and Analysis of Financial Condition and Results of Operations of the Information Memorandum and elsewhere in the Information Memorandum, unless otherwise indicated, have been calculated on the basis of our restated financial statements prepared in accordance with Indian GAAP, the Companies Act and restated in accordance with the SEBI ICDR Regulations and the Indian GAAP. Currency and units of presentation In the Information Memorandum, unless the context otherwise requires, all references to; Rupees or Rs. or INR are to Indian rupees, the official currency of the Republic of India. US Dollars or US$ or USD or $ are to United States Dollars, the official currency of the United States of America. All references to the word Lakh or Lacs, means One hundred thousand and the word Million means Ten lacs and the word Crore means Ten Million and the word Billion means One thousand Million. Industry and Market Data Unless stated otherwise, industry data used throughout the Information Memorandum has been obtained or derived from 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 the Information Memorandum is reliable, it has not been independently verified. Further, the extent to which the industry and market data presented in the Information Memorandum 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. FORWARD LOOKING STATEMENTS All statements contained in the Information Memorandum 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 the Information Memorandum regarding matters that are not historical facts. These forward looking statements and any other projections contained in the Information Memorandum (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 5

6 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 favourable 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; Any adverse outcome in the legal proceedings in which we are involved. For a further discussion of factors that could cause our current plans and expectations and actual results to differ, please refer to the chapters titled Risk Factors, Our Business and Management s Discussion and Analysis of Financial Condition and Results of Operations of the Information Memorandum. Forward looking statements reflects views as of the date of the Information Memorandum 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. our Company / our Directors does not 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. 6

7 II - RISK FACTORS An investment in the Equity Shares involves a high degree of risk. You should carefully consider all the information in the Information Memorandum, including the risks and uncertainties summarised below, before making an investment in our Equity Shares. The risks described below are relevant to the industries our Company is engaged in, our Company and our Equity Shares. To obtain a complete understanding of our Company, you should read this section in conjunction with the chapters titled Our Business and Management s Discussion and Analysis of Financial Condition and Results of Operations of the Information Memorandum as well as the other financial and statistical information contained in the Information Memorandum. Prior to making an investment decision, prospective investors should carefully consider all of the information contained in the section titled Financial Information of the Information Memorandum. Unless stated otherwise, the financial data in this section is as per our financial statements prepared in accordance with Indian GAAP. If any one or more of the following risks as well as other risks and uncertainties discussed in the Information Memorandum were to occur, our business, financial condition and results of our operation could suffer material adverse effects, and could cause the trading price of our Equity Shares and the value of investment in the Equity Shares to materially decline which could result in the loss of all or part of investment. Investors should pay particular attention to the fact that our Company is incorporated under the laws of India, and is therefore subject to a legal and regulatory environment that may differ in certain respects from that of other countries. The Information Memorandum also contains forward looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of many factors, including the considerations described below and elsewhere in the Information Memorandum. These risks are not the only ones that our Company face. Our business operations could also be affected by additional factors that are not presently known to us or that we currently consider to be immaterial to our operations. Unless specified or quantified in the relevant risk factors below, we are not in a position to quantify financial or other implication of any risks mentioned herein. Materiality The Risk factors have been determined on the basis of their materiality. The following factors have been considered for determining the materiality. Some events may not be material individually but may be material when considered collectively. Some events may have an impact which is qualitative though not quantitative. Some events may not be material at present but may have a material impact in the future. INTERNAL RISKS 1. Our Company had negative cash flow in recent fiscals, details of which are given below. Sustained negative cash flow could adversely impact our business, financial condition and results of operations. (Rs. In Lacs) Cash flows Operating Activity (0.78) (0.56) (0.89) (1.60) (0.06) Investing Activity Financing Activity Cash flow of a company is a key indicator to show the extent of cash generated from operations to meet its capital expenditure, pay dividends, repay loans and make new investments without raising finance from external resources. If we are not able to generate sufficient cash flow, it may adversely affect our business and financial operations. For further details please refer to the section titled Financial Information and chapter titled Management s Discussion and Analysis of Financial Condition and Results of Operations of 7

8 the Information Memorandum. 2. Our operations are significantly located in the Delhi region and failure to expand our operations may restrict our growth and adversely affect our business Currently, we are carrying our business mainly in the Delhi region and hence our major revenues are generated from operations in these regions only. In the event that demand for our products in general reduces or stops by any reason including political discord or instability or change in policies of State, then our financial condition and operating results may be materially and adversely affected. As we seek to diversify our regional focus we may face the risk that our competitors may be better known in other markets, enjoy better relationships with customers. Our lack of exposure in geographical boundaries outside our operating regions could impact our future revenues. 3. Our success depends largely upon the services of our Directors and other key managerial personnel and our ability to attract and retain them We are dependent on our Key Managerial Personnel for setting our strategic direction and managing our businesses. Our Promoters have over the years built relations with suppliers, customers and other persons who are connected with us. Accordingly, our Company s performance is dependent upon the services of our Promoters, our Executive Directors and other key managerial personnel. Our future performance will depend upon the continued services of these persons. Demand for key managerial personnel in the industry is intense and our inability to attract and retain key managerial personnel may affect the operations of our Company. 4. 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 products portfolio. 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. 5. The prices we are able to obtain for the trading products that we trade depend largely on prevailing market prices. The prevailing market price of our trading products has a significant impact on our profits. Commodities have been subject to price fluctuations resulting from weather, domestic and foreign trade policies, shifts in supply and demand and other factors beyond our control. As a result, any fluctuation in prices could have a material adverse effect on our Company and our results of operations. 6. We face intense competition in our businesses, which may limit our growth and prospects. Our Company faces significant competition from other manufacturers and traders. In particular, we compete with other traders operating in the markets in which we are present. Our competitors may have advantages over us, including, but not limited to: Substantially greater financial resources; Longer operating history than in certain of our businesses; Greater brand recognition among consumers; Larger customer bases in and outside India; or More diversified operations which allow profits from certain operations to support others with lower profitability. These competitive pressures may affect our business, and our growth will largely depend on our ability to respond in an effective and timely manner to these competitive pressures. 8

9 7. Our ability to pay dividends in the future will depend upon future earnings, financial condition, cash flows, working capital requirements and capital expenditures. Our future ability to pay dividends will depend on our earnings, financial condition and capital requirements. Dividends distributed by us will attract dividend distribution tax at rates applicable from time to time. There can be no assurance that we will generate sufficient income to cover the operating expenses and pay dividends to the shareholders. Our ability to pay dividends will also depend on our expansion plans. We may be unable to pay dividends in the near or medium term, and the future dividend policy will depend on the capital requirements and financing arrangements for the business plans, financial condition and results of operations. 8. We do not own our Registered Office from which we operate. We do not own the premises on which our Registered Office is situated. Our Company has taken the registered office on lease. We cannot assure you that we will have the right to occupy, these premises in the future, or that we will be able to continue with the uninterrupted use of this property, which may impair our operations and adversely affect our financial condition. Further these agreements are not registered and may not be adequately stamped under Indian law. In the event of any such irregularity, we may not be able to enforce our rights under such agreements in the event of a dispute. For further details of our office premises please refer to the section titled "Our Business Overview" of the Information Memorandum. 9. 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 promoters and our Promoter Group. 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 Related Party Transactions of the Information Memorandum. 10. Future issuances of Equity Shares or future sales of Equity Shares by our Promoters and certain shareholders, or the perception that such sales may occur, may result in a decrease of the market price of our Equity Shares. In the future, we may issue additional equity securities for financing our capital requirements. In addition, our Promoters and certain shareholders may dispose off their interests in our Equity Shares directly, indirectly or may pledge or encumber their Equity Shares. Any such issuances or sales or the prospect of any such issuances or sales could result in a dilution of shareholders holding or a negative market perception and potentially in a lower market price of our Equity Shares. 11. Our Company has not taken insurance cover hence we may not be able to protect ourselves from all losses and may in turn adversely affect our financial condition. Our Company has not taken any insurance cover at present. Hence we may not be able to protect ourselves from any damage or loss suffered by us. To the extent that we suffer loss or damage, our results of operations or cash flow may be affected. 12. The new Companies Act, 2013 is in the process of being implemented and any developments in the near future may be material with respect to the disclosures to be made in this Information Memorandum as well as other rules and formalities for completing the Issue. The Companies Act, 2013 has been published on August 29, 2013 and Section 1 of the said Act was notified on August 30, 2013 while 98 more sections were notified as on September 12, Though we have incorporated the relevant details pertaining to the new Companies Act, 2013 (to the extent notified) in this Information Memorandum, any further notifications by the MCA after our filing of this Information Memorandum may be material with respect to the disclosures to be made in this Information Memorandum. The Companies Act, 2013 is expected to replace the existing Companies Act, The 9

10 Companies Act, 2013 provides for, among other things, changes to the regulatory framework governing the issue of capital by companies, corporate governance, audit procedures, corporate social responsibility, the requirements for independent directors, director s liability, class action suits, and the inclusion of women directors on the boards of companies. The Companies Act, 2013 is expected to be complemented by a set of rules that shall set out the procedure for compliance with the substantive provisions of the Companies Act, In the absence of such rules, it is difficult to predict with any degree of certainty the impact, adverse or otherwise, of the Companies Act, 2013 on the Issue, and on the business, prospects and results of operations of the Company EXTERNAL RISKS 1. Global economic, political and social conditions may harm our ability to do business, increase our costs and negatively affect our stock price. Global economic and political factors that are beyond our control, influence forecasts and directly affect performance. These factors include interest rates, rates of economic growth, fiscal and monetary policies of governments, inflation, deflation, foreign exchange fluctuations, consumer credit availability, consumer debt levels, unemployment trends, terrorist threats and activities, worldwide military and domestic disturbances and conflicts, and other matters that influence consumer confidence, spending and tourism. Increasing volatility in financial markets may cause these factors to change with a greater degree of frequency and magnitude. 2. Global recession and market conditions could cause our business to suffer. The developed economies of the world viz. U.S., Europe, Japan and others are in midst of recovering from recession which is affecting the economic condition and markets of not only these economies but also the economies of the emerging markets like Brazil, Russia, India and China. General business and consumer sentiment has been adversely affected due to the global slowdown and there cannot be assurance, whether these developed economies will see good economic growth in the near future. Consequently, this has also affected the global stock and commodity markets. 3. Any disruption in the supply of power, IT infrastructure, telecom lines and disruption in internet connectivity could disrupt our business process or subject us to additional costs. Any disruption in basic infrastructure or the failure of the Government to improve the existing infrastructure facilities could negatively impact our business since we may not be able to provide timely or adequate supplies to our clients. We do not maintain business interruption insurance and may not be covered for any claims or damages if the supply of power, IT infrastructure, internet connectivity or telecom lines is disrupted. This may result in the loss of a client, impose additional costs on us and have an adverse effect on our business, financial condition and results of operations and could lead to decline in the price of our Equity Shares. 4. Natural calamities and changing weather conditions caused as a result of global warming could have a negative impact on the Indian economy and consequently impact our business and profitability. Natural calamities such as draughts, floods, and earthquakes could have a negative impact on the Indian economy and may cause suspension, delays or damage to our current projects and operations, which may adversely impact our business and our operating results. India s being a monsoon driven economy, climate change caused due to global warming bringing deficient / untimely monsoons could impact Government policy which in turn would adversely affect our business. 5. Tax rates applicable to Our Company may increase and may have an adverse impact on our business. Any increase in the tax rates including surcharge and education cess applicable to us 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. 10

11 6. Political instability or changes in the Government could adversely affect economic conditions in India generally and our business in particular. The Government of India has traditionally exercised and continues to exercise a significant influence over many aspects of the economy. Our business, and the market price and liquidity of our Equity Shares, may be affected by interest rates, changes in Government policy, taxation, social and civil unrest and other political, economic or other developments in or affecting India. Since 1991, successive governments have pursued policies of economic liberalization and financial sector reforms. However, there can be no assurance that such policies will be continued in the future. A significant change in India s economic liberalization and deregulation policies could disrupt business and economic conditions in India generally and adversely affect our business, financial condition and results of operations. 7. 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. 8. The price of our Equity Shares may be volatile, or an active trading market for our Equity Shares may not develop. There has been no public market for our Equity Shares. However, the trading price of our Equity Shares may fluctuate due to a variety of factors, including our results of operations and the performance of our business, competitive conditions, general economic, political and social factors, the performance of the Indian and global economy and significant developments in India s fiscal regime, volatility in the Indian and global securities market, performance of our competitors, the Indian Capital Markets and Finance industry, changes in the estimates of our performance or recommendations by financial analysts and announcements by us or others regarding contracts, acquisitions, strategic partnerships, joint ventures, or capital commitments. In addition, if the stock markets experience a loss of investor confidence, the trading price of our Equity Shares could decline for reasons unrelated to our business, financial condition or operating results. The trading price of our Equity Shares might also decline in reaction to events that affect other companies in our industry even if these events do not directly affect us. Each of these factors, among others, could materially affect the price of our Equity Shares. There can be no assurance that an active trading market for our Equity Shares will develop or be sustained after this Issue, or that the price at which our Equity Shares are initially offered will correspond to the prices at which they will trade in the market subsequent to this Issue. For further details of the obligations and limitations of Market Makers please refer to the chapter titled General Information of the Information Memorandum. 9. There are restrictions on daily movements in the price of the Equity Shares, which may adversely affect a shareholder s ability to sell, or the price at which it can sell, Equity Shares at a particular point in time. Following the Listing, we will be subject to a daily circuit breaker imposed by BSE, which does not allow transactions beyond specified increases or decreases in the price of the Equity Shares. This circuit breaker operates independently of the index-based, market-wide circuit breakers generally imposed by SEBI on Indian stock exchanges. The percentage limit on our circuit breakers will be set by the stock exchanges based on the historical volatility in the price and trading volume of the Equity Shares. 11

12 III INTRODUCTION SUMMARY OF OUR INDUSTRY Indian Economy India is the most attractive investment destination in the world, according to a survey by global consultancy firm Ernst & Young (EY). The Indian economy is expected to grow at 3.4 per cent in the current fiscal, a slight increase from 3.3 per cent in FY , as per projections from the Organisation for Economic Co-operation and Development (OECD). The growth is estimated to be even greater in FY (5.1 per cent) and FY (5.7 per cent). India s exports have also been doing well, touching US$ 303 billion in FY , almost double of what it managed (US$ 167 billion) four years ago. Experts express confidence that the figure will scale US$ 325 billion by the end of the current fiscal. The US$ 1.2 trillion investment planned in the infrastructure sector will go a long way in boosting export performance of Indian companies and the Indian growth story, according to Mr. Anand Sharma, Union Minister for Commerce and Industry, Government of India. The HSBC Trade Confidence Index, the largest trade confidence survey in the world, has positioned India at the top with 142 points. The increasing demand due to its population makes the country a good market for consumption goods, according to the report. The Economic Scenario India's industrial economy is gathering momentum on the back of improved output of eight core sector industries coal, crude oil, refining, steel, cement, natural gas, fertilizers and electricity which, at 8 per cent in September 2013, rose at its fastest pace in a year. The Cabinet Committee on Investments (CCI) has approved the speedy execution of 36 infrastructure pr ojects entailing investments of Rs 1,830 billion (US$ billion) to boost investor confidence, according to Mr. P Chidambaram, Union Minister for Finance, Government of India. Some of the other important economic developments in the country are as follows: Indian companies signed as many as 360 private equity (PE) deals totalling US$ 8.9 billion during the January October 2013 period, registering an increase of 33 per cent over the corresponding period a year ago. In the first 10 months of 2012, India Inc had announced 345 transactions worth US$ 6.7 billion, according to a report by global assurance, tax and advisory firm Grant Thornton. Indian corporate raised Rs 1,700 billion (US$ billion) through commercial papers (CPs) during the first half of FY A total of 169 issuers raised this amount, according to a report by Prime Database. Exports from India during August 2013 were valued at Rs 1, billion (US$ billion), registering a growth of per cent as compared to Rs 1, billion (US$ billion) during August The cumulative amount of FDI equity inflows into India were worth US$ billion in the April 2000 August 2013 period, according to the latest data published by Department of Industrial Policy and Promotion (DIPP). Foreign exchange (Forex) reserves of India rose in the week ending October 11, 2013 by US$ 1.5 billion to US$ billion, according to data released by the Reserve Bank of India (RBI). Growth Potential Story The CCI has approved for speedy execution of 36 infrastructure projects entailing investments of Rs 1,830 billion (US$ billion) to boost investor confidence, as per Mr. P Chidambaram, Union Minister for Finance, Government of India. Some of the other important developments in the country are as follows: IT spending by the Government of India is projected to reach US$ 6.4 billion in 2013, a growth of 7 per cent year-on-year, according to a report by research and advisory firm Gartner. 12

13 India's IT-business process outsourcing (BPO) industry revenue is expected to cross US$ 225 billion by 2020, according to a Confederation of Indian Industry (CII) report, titled 'The SMAC Code -Embracing New Technologies for Future Business'. General Electric (GE) plans to make India a manufacturing hub for its global markets due to its huge talent pool and lower manufacturing costs. The company's upcoming plant at Chakan, Maharashtra, is the first major step towards this direction, said Mr. Banmali Agrawal, President and CEO, GE South Asia. Public cloud services market in India is expected to grow by 37.5 per cent in 2013 to touch US$ 434 million. This is an increase of US$ 119 million from the US$ 315 million forecast for 2012, according to a study by Gartner. Garments exports from India have increased by 31 per cent to touch US$ 1.19 billion year-on-year (y-o-y) in October 2013, on back of increased demand from all major markets, including the US and the European Union (EU). The interest for costume jewellery is on the rise and costume jewelers estimate that they have clocked per cent growth in the current fiscal. The industry size is expected to touch Rs 150 billion (US$ 2.40 billion) by December 2015, as per an industry body. The number of millionaires in India is expected to reach 300,000 by 2018 from about 182,000 currently, according to the global wealth report released by the Credit Suisse Research Institute. Wealth per adult in India has risen by 135 per cent from US$ 2,000 in 2000 to US$ 4,700 in 2013, at an average annual rate of 8 per cent. India added about US$ 17.6 billion worth of value domestically in 2012 by processing and fabricating gold bars and coins. The Life Insurance Council (LIC), the industry body of life insurers in India, has estimated the sector to record a compound annual growth rate (CAGR) of per cent over the next five years. The total number of registered micro, small and medium enterprises (MSME) in India recorded a 19 per cent growth in FY , according to the Ministry of MSME's annual report for FY Road Ahead With the objective of taking bilateral trade relations to the next level of a comprehensive economic partnership agreement, India is readying itself to sign the free trade agreement (FTA) on services and investment with the Association of Southeast Asian Nations (ASEAN). The target for the two-way trade partnership is US $100 billion by 2015, for which an integrated transport network is necessary. Thus, the emphasis is on a massive road connectivity plan to tie the region together to enhance economic objectives. Moreover, agricultural gross domestic product (GDP) in India is expected to grow by over 5 per cent in the current agricultural year (July 2013 June2014). INDIAN DAIRY INDUSTRY Dairy sector is important not only as the producer of highly nutritious food products, but also for the sustenance of poor farmers and over all prosperity of the farming community. Currently, milk production in India is around 12.9 Crore metric tonnes per day with the country being the largest milk producer in the world. It is a matter of great pride that a nation which was deficit in milk has now become the leading milk producer in the world. Milk is the country's biggest agricultural produce, contributing 22 per cent to agricultural GDP. The size of Indian dairy industry in both organized and unorganized sectors is expected to double to $ 140 billion by 2020, on the back of growing demand and rising disposable income. The milk production alone is expected to cross 200 million tonnes by 2016 from the current 125 million tonnes. The industry, which had been a national heritage, is now re-emerging and catching the eye of investors due to its growth potential. Growth in financials of existing domestic players, diversification into dairy sector by other companies, surge in private equity deals, entry of foreign firms in the segment are some of the broad indications that India's organized dairy industry will remain on growth path at least till On Big Growth Path Operation Flood, initiated by Dr V Kurien, brought about a major transformation in India s dairy industry, 13

14 propelling India to become world s No. 1 milk producer. From 1/10th of the world production fifteen years go, India s production now accounts for 1/ 6th of total global milk output. Milk production in India is growing at 4 per cent per annum, whereas in the rest of the world it grows at 2.1 per cent. The current production in India is 116 million tonnes. But there are many shortcomings that need to be corrected to take the industry further forward. A major shortcoming is the low average per animal productivity. While the milk output growth is high, the demand is increasing at even a higher pace. Clearly, there is no room for complacency. Much needs to be done to boost both production and productivity. This underscores the importance of time-tested techniques like progeny testing and artificial insemination. The country s 12th Plan would aim at taking the current milk output from million tonnes to 150 million tonnes or so by The plan strategy lays much emphasis on productivity increase, one of the surest ways of keeping costs down. Milk Prices Cost is important since higher milk prices are a cause for concern for the government trying to address inflation worries. Compared to countries like U S, milk production in India is costly because land is expensive and interest rates are higher. But India enjoys the advantage of having cheaper labour. Labour is also easily available. But the cost of cattle feed is high due to exports and this has also contributed to high cost of milk.. The challenge is how to enhance milk output with limited resources and meet the growing demand, particularly in the cities, while at the same time keeping rising milk prices in check. Milk Production Outlook India s White Revolution has attracted world-wide attention and Indian performance is expected to continue to play a major role in the future of the dairy industry in the world in coming years. It is expected that the world milk production will rise to 867 MMT by 26 per cent from current 714 MMT. However, as per the current CAGR of 4 per cent and optimistic projection of 4.5 per cent, India`s milk production is estimated to touch 180 million MT by This will lead to increase of India`s share in the world milk production from the current 16 per cent to 21 per cent in The core of the dairy industry lies with the milk producing farmer, who gets affected by many factors ranging from fuel and agricultural input prices to government`s foreign policy. Hence, the state of milk producing farmer is crucial for the dairy industry. To sustain the milk production there has to be a right mix of social, environmental and economic factors influencing the farmer. National Policy Against this backdrop, the national policy on dairy is critical for the growth of dairy industry. Milk production in US has been growing at a very good pace as a result of policies of the US government which nurture and protect cooperative marketing by dairy farmers. Experts feel India should also continue its emphasis on dairy development through cooperatives and private investments to ensure long term growth and sustainability of the industry. India has the largest bovine population in the world with a large processing capacity of 98.3 million litres per day. Figures show, milk producers in India enjoy highest percentage share of consumers` rupee to 86 per cent. This is more than double that in other countries like US, European countries and New Zealand where the returns to milk producers is less than 40 per cent of the consumers spending on milk. Challenges However, there are challenges to dairy in India, mostly in the form of rapid urbanization, low interest of younger generation in dairy farming and increasing real estate price that leads to loss of farm lands. Due to these factors, some dairy regions may come under pressure. The preventive measures would be to implement changes in the dairy production to make farming system more competitive. In addition, there is a need to develop infrastructure to enhance production, followed by investment at farm level and improving feeding methods. More importantly, Government could consider giving relaxation in tax on farmer`s income from milk to encourage him to invest in dairy. Rising consumption India is not only the largest producer of milk but also the largest consumer of milk. The policy approach should be to create growth path for the dairy industry. Currently, milk constitutes 15 per cent of the average households expenditure on food. However, with increasing urbanization and growing GDP, income rises are leading to fall in share of food as percentage of total expenditure. 14

15 SUMMARY OF OUR BUSINESS We are engaged in the business of trading of Milk. We purchase the milk from the suppliers and sell it to our retail customers. Our Company owns a farm house in Kanpur city of Uttar Pradesh where our cattles are kept. Company owns sufficient cattles. We are expected to achieve sell sufficiency in the production of milk from the next financial year which will help in reducing supply constraints. Business Strategy of the Company is based on the principle of customer satisfaction and developing the enduring relationship with the people with whom we involve in business transaction. Our aim is to create the value for our customers, suppliers, investors and the Society and thus fulfilling our corporate responsibility. Products The Company at present is engaged in trading of Raw Milk but the company is planning to broaden its product line in the near future. Quality policy Siddarth Businesses Limited is committed: i. To provide best quality products confirming national/ international standards. ii. To provide apex level of trading services as per customer s requirement and deliver it to customer on time. iii. To improve the effectiveness of quality management system. Quality objectives i. To increase customers base in India and across the globe to become an icon in milk trading. ii. To keep continuing the increase in turnover in multiple rates. iii. To open more branches all over India. iv. To keep customer focused policy and its implementation from top to grass root level. v. To continue, providing best quality materials to our customers. Our Business Strategy & Aim Our aim is to focus on the profitability and customer satisfaction. We also seek to create value for our shareholders by improving our profitability. We strive to achieve these goals by implementing the following key business strategies: Maintenance of Quality of Products in which we trade. Expansion of product range in which we trade. Increasing the presence of our Company in other states. The reasonable and competitive pricing mechanism. 15

16 SUMMARY OF OUR FINANCIAL INFORMATION The following tables set forth summary financial information derived from Audited Financial statements for the period ended on March 31, 2013, 2012, 2011, 2010 and These financial statements have been prepared in accordance with the Indian GAAP, the Companies Act and the SEBI ICDR Regulations. The summary financial information presented below should be read in conjunction with the chapter titled Management s Discussion and Analysis of Financial Conditions and Results of Operations and Financial Information of the Information memorandum. Statement of Assets and Liabilities (Rs. in Lacs) Particulars Equity and Liability Share Capital -Equity Share Capital Preference Share Capital Total (a) Reserve & Surplus Profit & Loss (58.10) (59.11) (57.93) (56.32) (54.71) Securities Premium Total (b) (58.10) (59.11) (57.93) (56.32) (54.71) Non Current Liability Long Term Borrowing Long Term Provisions Differed Tax Liability Total Non Current Liabilities Current Liabilities Short Term Borrowings Trade Payables Other Current Liability Short Term Provisions Total Current Liabilities Total Equity & Liability ASSETS Non Current Assets a) Fixed Assets Tangible Assets Intangible Assets Capital Work in Progress Total Fixed Assets b) Non Current Assets c) Long Term Loans & Advances d) Deferred Tax Assets e) Other Non Current Assets Total Non Current Assets CURRENT ASSETS Current Investments Inventories Trade Receivables Cash & Cash Equivalent

17 Short Term Loan & Advances Other Current Assets TOTAL CURRENT ASSETS TOTAL ASSETS Summary Statement of Profit and Loss (Rs. in Lacs) Particulars Income Sales of Product Traded by the Company -Export Domestic Sale Total Operating Income Other Income Change in the Inventories Total Income Expenditure Purchase of Traded Goods Employee Benefit Expenses Administrative Expenses Other Expenses Total (B) (0.06) Profit Before Interest, 1.24 (1.18) (1.61) (1.62) (0.06) Depreciation and Tax Depreciation Profit Before Interest and Tax 1.24 (1.18) (1.61) (1.62) (0.06) Financial Charge Profit before Tax 1.24 (1.18) (1.61) (1.62) (0.06) Provision for Tax Provision for Deferred Tax Total (0.23) Profit after Tax Before Extra 1.01 (1.18) (1.61) (1.62) (0.06) Ordinary Item Profit from extra ordinary items net of taxes Profit after extra ordinary Items 1.01 (1.81) (1.61) (1.62) (0.06) Earnings Per Share Basic 0.42 (0.49) (0.67) (0.67) (0.06) Diluted 0.42 (0.49) (0.67) (0.67) (0.06) 17

18 Summary of Cash flow Statement (Rs. In Lakh) PARTICULARS A. CASH FLOW FROM OPERATING ACTIVITY Profit Before Tax 1.25 (1.18) (1.61) (1.62) (0.06) Adjusted For: a. Depreciation b. Interest Expenses c. Diminution in the value of Long Term Investment Operating Profit before working Capital Change 1.25 (1.18) (0.92) (1.62) (0.06) Adjusted for: a. Decrease/(Increase) in the Loans and Advances b. Decrease/Increase in inventories C. Decrease/Increase in Trade (0.90) Receivables d. Decrease/Increase in Short term (0.38) Loans & Advances e. Decrease/Increase in other (0.50) current Assets f. Increase/Decrease in other (0.25) Current Liability Deferred Revenue Expenditure Cash flow from Extra ordinary Activity Direct Taxes Paid Net Cash Flow From Operating Activity (0.78) (0.56) (0.89) (1.61) (0.06) Cash flow from investing Activities Purchase of Fixed Assets/Investment Sale of Fixed Assets/Investment Interest Received Dividend Received Net Cash Flow From the investing Activity Cash Flow From Financing Activity Proceeding from Long term Borrowings Repayment of Long Term Borrowing Interest or Dividend Paid Net Cash Flow From Financing Activities Net Increase /Decrease in cash & 0.18 (0.03) (0.09) (.05) (0.02) Cash Equivalent` Cash & Cash Equivalent at the beginning of the year Cash & Cash Equivalent at the end of the year (0.10)

19 GENERAL INFORMATION Our Company was incorporated as Wisdom Investment Private Limited a private limited company under the Companies Act, 1956 pursuant to Certificate of Incorporation dated May 12, 1983 issued by the Registrar of Companies, National Capital Territory of Delhi. Further, our Company was converted in to public limited Company consequently the name of the Company was changed to Wisdom Investment Limited pursuant to a Fresh Certificate of Incorporation dated November 24, 1983 issued by the Registrar of Companies, N a t i o n a l C a p i t a l Territory of Delhi. Subsequently, the name of our Company was changed to Siddarth Businesses Limited vide the fresh certificate of incorporation dated July 16, 1992 issued by the Registrar of the Companies National Capital territory of Delhi. The name of our Company was further changed to Indo Kush Foods Limited pursuant to a Fresh Certificate of Incorporation dated September 2, 2010 issued by the Registrar of Companies, National Capital territory of Delhi. Name of Our Company was again changed to Siddarth Businesses Limited pursuant to the fresh certificate of incorporation issued on March 2, 2012 by the Registrar of the Companies National Capital territory of Delhi. Our corporate identification number is L51909DL1983PLC Registered Office of our Company Siddarth Businesses Limited D-153A, IIIrd Floor, Okhla Industrial Area Phase I, New Delhi Tel: Siddarth.business@gmail.com Website: For details of change in the name and Registered Office of our Company, please refer to the chapter titled History and Certain Corporate Matters of the Information Memorandum. Address of the ROC Registrar of Companies 4 th Floor, IFCI Tower, 61, Nehru Place, New Delhi Delhi India Phone: , FAX: roc.delhi@mca.gov.in Name of the Stock Exchange where proposed to be listed Our Company proposed to list its Equity Shares on BSE Limited. Our Board of Directors The following table sets out details regarding our Board as on the date of the Information Memorandum Sr. Name Age (Years) Nationality Address No. 1. Sudharshan Jha 59 Indian M-183, Raghubir Nagar, New Delhi , Delhi, India 2. Ratan Singh 48 Indian H.No. 266/37, Sector 37, Faridabad , Haryana, India 4. Manish Mishra 29 Indian H. No. 42, Nehru Nagar, Garh Road, Meerut, , (U.P.) For details of change in the name and Registered Office of our Company, please refer to the chapter titled History and Certain Corporate Matters of the Information Memorandum. 19

20 Company Secretary & Compliance Officer Ms. Deepa Gupta Siddarth Businesses Limited D-153A, IIIrd Floor Okhla Industrial Area, Phase I, New Delhi Tel: Siddarth.businesses@gmail.com Website: Investors may contact our Compliance Officer and/or the Registrar to the Issue, Skyline Financial Services Private Limited in case of any problems related to share transfer or registration of Transfers, non-receipt of Dividend warrants or Annual Report etc. BANKERS TO THE COMPANY HDFC Bank Limited K-2, Jungpura Extension, Commercial Complex, New Delhi Tel: Fax: Website: STATUTORY AUDITORS OF THE COMPANY Goel Mintri & Associates, Chartered Accountants L-76, Ground Floor, Lajpat Nagar-II New Delhi sanjaygoelca@hotmail.com FRN: N Contact Person: Mr. Sanjay Goel Eligibility Criterion The Company is submitting its Information Memorandum, containing information about itself, making disclosures in line with the disclosure requirement for public issues, as applicable, to BSE for making the said Information Memorandum available to public through their website viz. The information memorandum shall also be available at the site of our Company Prohibition by SEBI The Company, its Directors, its Promoters, other companies promoted by the Promoters and companies with which the Company s Directors are associated as directors have not been prohibited from accessing the capital markets under any order or direction passed by SEBI. Caution The Company accepts no responsibility for statements made otherwise than in the Information Memorandum or any other material issued by or at the instance of the Company and anyone placing reliance on any other source of information would be doing so at his or her own risk. All information shall be made available by the Company 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. 20

21 Disclaimer Clause of BSE As required, a copy of this Information Memorandum is being submitted to BSE. The BSE does not in any manner: Warrant, certify or endorse the correctness or completeness of any of the contents of this Information Memorandum; or Warrant that this Company s securities will be traded or will continue to be traded on the BSE; Take any responsibility for the financial or other soundness of this Company, its promoters, its management or any scheme or project of this Company; And it should not for any reason be deemed or construed to mean that this Information Memorandum has been cleared or approved by the BSE. Every person who desires to acquire any securities of this Company may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against the BSE whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription / acquisition whether by reason of anything stated or omitted to be stated herein or for any other reason whatsoever. Filing Copies of this Information Memorandum have been filed with BSE in due compliance. Listing Application has been made to BSE for listing and permission to deal in and for an official quotation of the Equity Shares of the Company. Demat Credit The Company has obtained ISIN No. from NSDL on 16 th December 2013 and from CDSL on 13 th December Dematerialization of Shares Tripartite agreements have been signed between the Company, the Registrar and CDSL and NSDL. The ISIN No. allotted to the Company is INE857P CAPITAL STRUCTURE The Equity Share capital of our Company, as on 31 st March 2014 is set forth below: Sr. No. Particulars Amount (in Rs. Lac) A. Authorised Share Capital Equity Shares of Rs. 10 Each B. Issued and Subscribed Capital Equity Shares of Rs. 10 Each C. Paid-up Share Capital Equity Shares of Rs. 10 Each D. Details of outstanding convertible instruments including warrants pending conversion N.A. 21

22 NOTES TO THE CAPITAL STRUCTURE 1. Details of increase in authorised Share Capital: Since the incorporation of our Company, the authorised share capital of our Company has been altered in the manner set forth below: Particulars of Changes From To Rs divided in to Equity Shares of Rs. 100 Each Rs divided in to Rs divided in to Equity Shares of Equity Shares of Rs. 100/- Each Rs. 10/- Each Rs divided in to Equity Shares of Rs. 10/- Each Rs divided in to Equity Shares of Rs. 10 each and Preference Shares of Rs. 100/- Rs divided in to Equity Shares of Rs. 10 each and Preference Shares of Rs. 100/- Rs divided into Equity Shares of Rs. 10/- each Rs divided into Equity Shares of Rs. 10/- each Date of Shareholder s Meeting AGM / EGM/Postal Ballot At the time of N.A. Incorporation Extra Ordinary General Meeting Extra Ordinary General Meeting Rs Extra Ordinary General Meeting Rs divided into Equity Shares of Rs. 10/- each Rs divided into Equity Shares of Rs. 10/- each Annual General Meeting Postal Ballot 2. History of Paid Up Equity Share Capital Date of Allotment No. of Equity Shares Face Value Issue Price Nature of Considerati on Nature of Allotment Cumulative No. of Shares Cumulative Paid up Share Capital Cash Subscription 2 20 to the Memorand um Cash Public Issue Cash Preferential Allotment ,650, Equity Shares issued for consideration other than cash by our Company. Our Company has not issued any Equity Shares for consideration other than cash. 4. Our shareholding pattern (a) The table below represents the shareholding pattern of our Company in accordance with clause 35 of the Listing Agreement, as on 21 st June 2014: 22

23 Table (I)(a) Categor Category of y Shareholder code Statement Showing Shareholding Pattern No. of Shareh olders Total number of shares 23 Number of shares held in dematerial ized form Total shareholding as a percentage of total number of shares As a percenta ge of(a+b) 1 As a percent age of (A+B+C) Shares Pledged or otherwise encumbered No. of shares As a % (A) Shareholding of Promoter and Promoter Group 2 1 Indian (a) Individuals/ Hindu Undivided Family 2 170, , (b) Central Govt./ State Govt. (s) (c) Bodies Corporate (d) Financial Institutions/ Banks (e) Any Others(Specify) Sub Total(A)(1) 2 170, , Foreign A Individuals (Non- Residents Individuals/ Foreign Individuals) B Bodies Corporate C Institutions D Qualified Foreign Investor E Any Others(Specify) Sub Total(A)(2) Total Shareholding of Promoter and Promoter Group (A)= (A)(1)+(A)(2) 2 170, , (B) Public shareholding 1 Institutions (a) Mutual Funds/ UTI (b) Financial Institutions / Banks (c) Central Govt./ State Govt. (s) (d) Venture Capital Funds (e) Insurance Companies (f) Foreign Institutional Investors

24 (g) Foreign Venture Capital Investors (h) Qualified Foreign Investor (i) Any Other (Specify) Sub-Total (B)(1) B 2 Non-institutions (a) Bodies Corporate (b) Individuals I Shareholders holding nominal share capital up to Rs 1 lakh Ii Shareholders holding nominal share capital in excess of Rs. 1 lakh. 43 4,175,000 4,175, (c) Qualified Foreign 0.00 Investor (d) Any Other I Hindu Undivided Family 2 150, , Sub-Total (B)(2) 569 4,394,652 4,325, (B) Total Public Shareholding (B)= (B)(1)+(B)(2) 569 4,394,652 4,325, TOTAL (A)+(B) 571 4,565,000 4,494, (C) Shares held by Custodians and against which Depository Receipts have been issued GRAND TOTAL (A)+(B)+(C) 571 4,565,000 4,494,

25 (I)(b) Statement showing holding of securities (including shares, warrants, convertible securities) of persons belonging to the category Promoter and Promoter Group Sr. No. Name of the shareholder Details of Shares held Number of shares held As a % of grand total (A) +(B) +( C ) Encumbered shares (*) Details of warrants No. As a perc enta ge As a % of grand total (A)+(B)+( C) of subclause (I)(a ) Numbe r of warran ts held As a % total numb er of warra nts of the same class Details of convertible securities Numbe As a % r of total convert numbe ible r of securiti conver es tible held securit ies of the same class Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital (I) (II) (III) (IV) (V) (VI)= (V)/( III)*1 00 (VII) (VIII) (IX) (X) (XI) (XII) 1 Swaranlata Jalan Siddarth Jalan TOTAL (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 percentage of total number of shares {i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (I)(a) above} 25 Details of warrants Number of warrants held As a % total number of warrants of the same class Details of convertible securities Number of convertible securities held % w.r.t total number of convertible securities of the same class Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital 1 SIDDARTH GUPTA RAM AVTAR GUPTA RAJIV GARG SANJIV GARG RAKHI AHUJA AMANDEEP SINGH SONALI JAIN

26 8 RAMESH ROSHAN BORANA SAVITA GUPTA RAJESH SETHI RISHAB SETHI DEEPAK GUPTA DEEPAK GUPTA AMITABH SANDUJA YASHWANT KUMAR JAIN SUNIL KUMAR GUPTA KAMAL DANGI DINESH DANGI RAMESH PATEL KAMLESH SANDUJA REKHA AMIT GUPTA MANISH GUPTA MADANLAL SAWAR MAL AGARWAL VISHAL AGARWAL ARVIND DADU ANIL KUMAR SETHI SWARUP NARAIN AGARWAL GUNJAN AGARWAL ARTI RASTOGI RAJENDRA KUMAR 32 GUPTA NIKHIL SINHA HARJEET SINGH SUCHITRA CHHILLAR MAHESH KALRA KAILASH SAHU MAHESH KALRA RAM CHANDER CHHILLAR ANUBHAV MITTAL RAJIV JAIN ASHOK KUMAR MITTAL SANJAY KUMAR JAIN RAJESH ARORA SANJANA CHOPRA TOTAL

27 (I)(c)(ii) 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 Sr. No. 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 number of warrants of the same class Details of convertible securities Number of % w.r.t convertible total securities number of held convertible securities of the same class Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital 1 SIDDARTH GUPTA TOTAL (I)(d) Statement showing details of locked-in shares Sr. No. Name of the shareholder 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} 1 SIDDARTH GUPTA RAM AVTAR GUPTA RAJIV GARG SANJIV GARG RAKHI AHUJA AMANDEEP SINGH SONALI JAIN RAMESH ROSHAN BORANA SAVITA GUPTA RAJESH SETHI RISHAB SETHI DEEPAK GUPTA DEEPAK GUPTA AMITABH SANDUJA YASHWANT KUMAR JAIN SUNIL KUMAR GUPTA KAMAL DANGI DINESH DANGI RAMESH PATEL KAMLESH SANDUJA REKHA AMIT GUPTA MANISH GUPTA

28 24 MADANLAL SAWAR MAL AGARWAL VISHAL AGARWAL ARVIND DADU ANIL KUMAR SETHI SWARUP NARAIN AGARWAL GUNJAN AGARWAL ARTI RASTOGI RAJENDRA KUMAR GUPTA NIKHIL SINGHA HARJEET SINGH SUCHITRA CHHILLAR MAHESH KALRA KAILASH SAHU MAHESH KALRA RAM CHANDER CHHILLAR ANUBHAV MITTAL RAJIV JAIN ASHOK KUMAR MITTAL SANJAY KUMAR JAIN RAJESH ARORA SANJANA CHOPRA TOTAL (II)(a) Sr. No. Statement showing details of Depository Receipts (DRs) Type of outstanding DR (ADRs, GDRs, SDRs, etc.) Number outstanding of DRs Number of shares underlying 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 (I)(a) above} Nil TOTAL (II)(b) Sr. No. 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 Name of the DR Holder Type of outstanding DR (ADRs, GDRs, SDRs, etc.) Number of shares underlying 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 (I)(a) above} Nil TOTAL

29 5. Particulars of top ten shareholders as on 21 st June 2014 Sr.No. Name of Shareholders No. of Shares % of the issued capital 1. SIDDARTH GUPTA RAM AVTAR GUPTA RAJIV GARG SANJIV GARG SWARAN LATA JALAN RAKHI AHUJA AMANDEEP SINGH SONALI JAIN RAMESH ROSHAN BORANA SAVITA GUPTA

30 ABOUT THE COMPANY History of our Company Our Company was incorporated as Wisdom Investments Private Limited under the Companies Act, 1956 pursuant to Certificate of Incorporation dated May 12, 1983 issued by the Registrar of Companies, National Capital Territory of Delhi. Further, our Company was converted in to public limited Company consequently the name of the Company was changed to Wisdom Investment Limited pursuant to a Fresh Certificate of Incorporation dated November 24, 1983 issued by the Registrar of Companies, N a t i o n a l C a p i t a l Territory of Delhi. Subsequently, the name of our Company was changed to Siddarth Businesses Limited vide the fresh certificate of incorporation dated July 16, 1992 issued by the Registrar of the Companies National Capital territory of Delhi. The name of our Company was further changed to Indo Kush Foods Limited pursuant to a Fresh Certificate of Incorporation dated September 2, 2010 issued by the Registrar of Companies, National Capital territory of Delhi. Name of Our Company was again changed to Siddarth Businesses Limited pursuant to the fresh certificate of incorporation issued on March 2, 2012 by the Registrar of the Companies National Capital territory of Delhi. Our corporate identification number is L51909DL1983PLC Our Company was initially engaged in the business of trading in to the shares of the Companies since incorporation. The Company changed its object in order to diversify the area of operation in trading of milk. Further Company also added Import and Export Businesses in its object clause under section 149 (2A) of the Companies Act. Presently, we are engaged in the business of trading of milk. Our promoters are Mr. Siddarth Jalan and Ms. Swaranlata Jalan. The Company was incorporated with the object of trading in to the shares of the Companies. Later the Company changed its object to add trading in to the milk and the import Export Business. Changes in our Registered Office: Our Company s Registered Office is currently situated at D-153A, IIIrd Floor, Okhla Industrial Area, Phase I, New Delhi Details of changes in the address of the Registered Office of our Company with in last 2 years are set forth as under: Sr. No. From To Date Reason for Change 1. 72, Janpath, New D-153A, Okhla Industrial Area, May 2013 Administrative Delhi Phase I, New Delhi convenience Main Objects of Our Company as on the Date of the Information Memorandum: The object clauses of the Memorandum of Association of our Company enable us to undertake the activities stated below. 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 acquire and takeover as a going concern business along with all the assets and liabilities (Including benefits of contracts) of that business used with connection therewith or belonging thereto. 2. To carry on and conduct the business of food processing industries and in particular the processing of milk food by setting up and maintaining necessary establishment installed with necessary factories and for the purpose to obtain registration and to hold licence according to the provision of law in that behalf or any statuary modification thereof for the time being in force. 3. To engage and embark the enterprise of setting up and establishing the industry of processing milk food and any other products allied thereto and for the purpose to set up and maintain factory or factories at such places as may be considered fit and expedient and to carry on and conduct the business of food processing industries. 30

31 4. To carry on and conduct the business of dairying with view to obtaining supply of milk required for the industry of processing milk, food of all descriptions as warranted by law enacted for the purpose and to undertake the enterprise of farming for the maintenance and breeding of live-stock and for purpose to set up and maintain dairies and other establishments installed with necessary equipments. 5. To purchase, acquire, keep, maintain, breed or otherwise dispose off all kinds of cattle cows, buffaloes, pigs, poultry, or dead of all descriptions. 6. To manufacture, produce, process, prepare, buy, sell and deal in all kind of dairy products and to deal in biscuits, breads, cakes, pastries, confectionery, sweets, chocolates, toffees, breakfast foods, protein foods, deistic products, strained baby foods, instant food, tea and coffee, cereal products, wheat flakes, maize flakes and provisions of all such kinds. 7. To sell, import, export, improve, prepare, manufacture and market and to carry on the business of various dairy products, canners, preservers, growers of and dealers in fruits, vegetables, herbs, medicines, flowers, drinks, fluids and other Irish and preferable products and to carry on the manufacturing and trading in jams, jelly, pickles, cider, chutney, vinegars, ketchups, juices, squashes, syrups, powders (edible) drinks, beverages, gelatins, essences, meat, sausages, porkpies, prawn, portend meat and provision of all kinds. 8. To acquire and takeover the whole or any part of business, goodwill, trademarks, etc. and the property and liabilities of any person or persons, firm or corporation or any industrial undertaking either existing or new and engage in carrying on and conducting any business which this Company is authorized to carry on. Key Events and Milestones: The following table sets forth the key events and milestones in the history of our Company, since incorporation: Sr. No. Financial Year Events 1. May 1983 Incorporation of the Company as the Private limited Company 2. November 1983 Conversion of the Company from Private Limited to the Public Limited Company 3. January 1984 Public Issue of thousand Equity Shares 4. July 1992 Company changed its name from Wisdom Investment Limited to Siddarth Businesses Limited 5. June 2010 Change in the name of the Company form Siddarth Businesses Limited to Indo Kush Foods Limited 6. August 2010 Alteration of Object clause 7. February 2012 Change in the name of the Company From Indo Kush Foods limited 8. September 2013 Alteration of Articles of Association 9. September 2013 Increase in the Authorised Share Capital (Alteration of Memorandum of Association) 10. November 2013 Increase in the Authorised share capital of the Company (Alteration of Memorandum of Association) 11. November 2013 Preferential allotment Subsidiaries and Holding Company: Our Company is not a subsidiary of any company. Further, as on the date of the Information Memorandum our Company does not have any subsidiary company. Name of Group Companies/Sub Group Companies Listed on BSE: No Group Companies as on date of the Information Memorandum. 31

32 Statement of Dividend The declaration and payment of dividends on our Equity Shares will be recommended by the Board of Directors and approved by the shareholders of our Company, at their discretion, and will depend on a number of factors, including but not limited to the profits, cash flows, capital expenditure, capital requirements and overall financial condition. The Board may also from time to time pay interim dividend. Our Company has declared dividend as follows: Particulars Face Value Per Equity shares Dividend Paid Fiscal Year 2013 Rs. 10/- NIL Fiscal Year 2012 Rs. 10/- NIL Fiscal Year 2011 Rs. 10/- NIL Fiscal Year 2010 Rs. 10/- NIL Fiscal Year 2009 Rs. 10/- NIL Fiscal Year 2008 Rs. 10/- NIL Fiscal Year 2007 Rs. 10/- NIL Fiscal Year 2006 Rs. 10/- NIL Fiscal Year 2005 Rs. 10/- NIL Fiscal Year 2004 Rs. 10/- NIL Bonus Shares Our Company has not issued Bonus Shares in the current financial year Apart from the above, our Company has issue bonus shares as follows: Particulars Face Value Per Equity shares Ratio Fiscal Year 2013 Rs. 10/- NIL Fiscal Year 2012 Rs. 10/- NIL Fiscal Year 2011 Rs. 10/- NIL Fiscal Year 2010 Rs. 10/- NIL Fiscal Year 2009 Rs. 10/- NIL Fiscal Year 2008 Rs. 10/- NIL Fiscal Year 2007 Rs. 10/- NIL Fiscal Year 2006 Rs. 10/- NIL Fiscal Year 2005 Rs. 10/- NIL Fiscal Year 2004 Rs. 10/- NIL Statement containing particulars of the dates of and parties to all material contracts, 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) together with the brief description of terms, subject matter and general nature of the documents, if applicable The Company has not entered into any material contract, concessions and similar other documents except those entered into in the ordinary course of the business carried on or intended to be carried on by the company. Statement containing particulars of any commission, brokerage, discount or other special terms including an option for the issue of any kind of securities granted to any person, if applicable No, Our Company has not given commission, brokerage, discount or other special terms including an option for the issue of any kind of securities granted to any person 32

33 Other declarations and disclosures Our Company is listed on Delhi Stock Exchange Limited and proposed to be listed on BSE Limited Our Company is not a sick company within the meaning of the term as defined in the Sick Industrial Companies (Special Provisions) Act, Our Company is not under winding up nor has it received a notice for striking off its name from the relevant Registrar of Companies. Revaluation of assets: Our Company has not re valued its assets since its incorporation. Changes in the activities of Our Company having a material effect Other than the above, there has been no change in the activities being carried out by our Company during the preceding five years from the date of the Information Memorandum which may have a material effect on the profits / loss of our Company, including discontinuance of lines of business, loss of agencies or markets and similar factors. Injunctions or Restraining Orders: Our Company is not operating under any injunction or restraining order. Mergers and acquisitions in the history of Our Company There has been no merger or acquisition of businesses or undertakings in the history of our Company. Defaults or Rescheduling of borrowings with financial institutions/banks: There have been no Defaults or Rescheduling of borrowings with financial institutions/banks. Strikes and lock-outs: Our Company has, since incorporation, not been involved in any labour disputes or disturbances including strikes and lock- outs. As on the date of the Draft Prospectus, our employees are not unionized. Shareholders agreement: Our Company does not have any subsisting shareholders agreement as on the date of the Information Memorandum. Other Agreements: Our Company does not have any other agreement as on the date of the Information Memorandum. Strategic Partners: Our Company does not have any strategic partner(s) as on the date of the Information Memorandum. Financial Partners: As on the date of the Information memorandum, apart from the various arrangements with bankers and financial institutions which our Company undertakes in the ordinary course of business, our Company does not have any other financial partners. 33

34 INDUSTRY OVERVIEW In India, the dairy sector plays an important role in the country s socio-economic development, and constitutes an important segment of the rural economy. Dairy industry provides livelihood to millions of homes in villages, ensuring supply of quality milk and milk products to people in both urban and rural areas. With a view to keeping pace with the country s increasing demand for milk and milk products, the industry has been growing rapidly. According to our research report Indian Dairy Industry Analysis, India is the world s largest milk producer, accounting for around 17% of the global milk production. Besides, it is one of the largest producers as well as consumers of dairy products. Due to their rich nutritional qualities, the consumption of dairy products has been growing exponentially in the country, and considering such facts and figures, our study anticipates that the milk production in India will grow at a CAGR of around 4% during With the rising use of dairy products, the secondary market for dairy products has also been flourishing, our report observed. For this, we have included the analysis of secondary market for dairy products, including tea, coffee, infant nutrition, malted foods, and bakery products. Covering the necessary aspects of the Indian dairy industry, the study facilitates knowledge about its current market scenario and future growth. Analyzing the past and current state of the industry, the report tries to find out how trends like the entry of international companies and safe packaging are attracting more consumers and leading to further growth in the market. This way, it presents a clear picture of the direction, in which the industry is likely to proceed in the coming years. The government is taking several initiatives and running plans and programs like National Diary Plan and Intensive Dairy Development Program to meet the growing demand for milk in the country. Our report talks about such schemes, and government regulations to present an objective and balanced picture of the industry. The study also discusses the opportunities and strengths of the dairy market in a complete SWOT analysis, and provides an insight into the competitive landscape. Dairy Structure in India India has a unique pattern of production, processing and marketing/consumption of milk, which is not comparable with any large milk producing country. Approximately 70 million rural households (primarily, small and marginal farmers and landless laborers) in the country are engaged in milk production. 0ver 11 million farmer are organized into about 0.1 million village Dairy Cooperative Societies with about 110 farmers per society. Of the total milk produced, about 50 % is retained by the producers for domestic consumption leaving about 50 % as the marketable surplus. The dairy industry handling the marketable surplus of the milk is broadly divided into the following two groups: Organized sector Unorganized sector The organized sector refers to the dairy units registered under the Milk and Milk Products Order, These dairies have each capacity of handling 10,000 liters of milk per day or above and are registered as Cooperatives, Private or Others ( like Government Dairies). The unorganized sector comprises of numerous small and /or seasonal milk producers/traders (popularly known as halwais) that are not registered under MMPO. They handle less than 10,000 liters of milk per day. They are involved in selling raw liquid milk, boiled liquid milk as well as selling mainly traditional milk products, usually at the local levels, but have a major share in these milk products. There are no official records on number of such unorganized dairy units. The organized dairy sector procures around 30% of the marketable surplus i.e. around 15 % of the national milk production, while the unorganized sector handles about 70% of the marketable milk. 34

35 Indian Dairy Industry Organised Unorganised Private Dairies (National) Private Dairies (International) Coooperative Sociteies Government In India, the dairy sector is important for various reasons. This sector enjoys a complementary role with agriculture and has the capability to enrich the protein diet of the predominantly vegetarian population. Dairy products are also a major source of cheap and nutritious food to millions of eople in India and the only acceptable source of animal protein for the large vegetarian segment of the Indian population, particularly for the landless, small and marginal farmers and women. In addition, the dairy sector has, in recent years, emerged as an important source of rural employment and income in the country. It has shown an impressive growth of more than 5 % per annum during the last few decades; even though the country emerged as the largest producer of milk only in the '90s. The dairy industry in India has come a long way from dependence to self-reliance as the volume of milk produced more than tripled in a span of three decades, from 23 million tonnes in 1973 to 95 million tonnes in the year From being written off as a basket case a few decades back, India as emerged as the largest milk producing country in the world with an annual production of more than 100 million tonnes in The value of India's dairy sector was estimated at Rs 2300 billion in the year 2005, which by the year 2011 will more than double and is expected to be around Rs 5,200 billion according to estimates by Dairy India. The annual milk production is estimated to rise to 120 million tonnes. More amazing is the fact that more than 70 % of the Indian milk producers are small marginal farmers; the animals are low yielding nondescript ones; and land holdings are small. By any yardstick, this is a remarkable feat. The current annual growth rate in milk production is pegged at between 4 to 6%. This is primarily due to the initiatives taken by the Operation Flood Programme in organizing the milk producers into Amul type cooperatives; building infrastructure for milk procurement, and the related processing and marketing activities. Operation Flood providedd the much needed financial, technical and management inputs. The ensuring of remunerative prices to milk producers and the organization of an efficient supply chain management system had a snow balling impact on milk production, turning it into a modern viable self- one, is now sustaining organized sector. The milk production system, which was essentially a self-contained being transformed into a commercial proposition. 35