Draft Offer Documents

(Offer Document will be updated upon filing with the ROC).

Caution : This Draft Offer Document would be updated and modified to incorporate the comments of Securities and Exchange Board of India (SEBI) and Stock Exchanges. The Draft Offer Document will be suitably modified to incorporate changes recommended by regulatory bodies and updated before filing with the Registrar of Companies, Gujarat under Section 60 of the Companies Act, 1956. This Draft Offer Document does not constitute an offer or an invitation to any person to subscribe to the Equity shares of Wonder Craft Industries Limited and is being issued for the sole purpose of ascertaining the demand for the Equity Shares. The contents of this Draft Offer Document are intended to be used exclusively by the persons to whom it is distributed.

WONDER CRAFT INDUSTRIES LIMITED

The Company was incorporated on July 15,1996 in Gujarat, under the provisions of the Companies Act, 1956, (hereinafter referred to as the Act) as a Private Limited company under the name and style " Wonder Craft-Packaging Private Limited " and was subsequently converted into a Public Limited Company and received Fresh Certificate for Incorporation on 9th May 2000 from The Registrar of companies, Gujarat, Dadra and Nagar Haveli. The company was renamed as Wonder Craft Industries Limited on 12th July, 2000.

Registered Office :

B/3, Neekunj Apartments, Opp. Krishna Talkies, Siddhnath Road, Baroda - 1

Tel. No. : 0265- 42 43 76.

Tele Fax no.: 0265 - 42 43 76

Factory :

P.O. Box No.14, Navi Jitharadi, Karjan Dhavat Road, Tal - Karjan,

Dist - Baroda - 391 204, Tele Fax : 02666 - 32455.

Issue of * Equity Shares of Face Value of Rs.10/- each for cash at Rs. ** aggregating to Rs. 400.00 lacs. The Issue includes a Book Built Portion of 75% aggregating to Rs. 300.00 lacs and Fixed Portion of 25% aggregating to Rs. 100.00 lacs.

RISK IN RELATION TO THE FIRST ISSUE

This being the first issue of the company, there has been no formal market for the securities of the company. The Issue price (as has been determined by the Company in consultation with Allocation committee comprising of a representative from each Book Running Lead Manager, on the basis of assessment of market demand for the offered securities by way of Book Building) should not be taken to be indicative of the market price of the Equity Shares after the shares are listed. No assurance can be given regarding an active or sustained trading in the shares of the Company nor regarding the price at which equity shares will be traded after listing.

GENERAL RISKS

Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in this offer unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this offering. For taking an investment decision investors must rely on their own examination of the issuer and the offer including the risks involved. The securities have not been recommended or approved by Securities and Exchange Board of India nor does Securities and Exchange Board of India guarantee the accuracy or adequacy of this document.

(Investors are advised to refer page no. (...) of the Offer Documents for statement of Risk Factors).

ISSUER'S ABSOLUTE RESPONSIBILITY

The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Draft Offer Document contains all information with regard to the Issuer and the issue, which is material in the context of the issue, that the information contained in this Offer Document is true and correct in all material respects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.

LISTING

The Equity Shares are proposed to be listed on the Vadodra Stock Exchange (Regional Stock Exchange), The Stock Exchange , Ahemdabad and the The Stock Exchange, Mumbai.

1. The company vide letter dated ...../ .... /...... has received approval from Vadodra Stock Exchange for listing and trading of its Equity Shares.

2. The company vide letter dated ...../ .... /...... has received approval from Ahemdabad Stock Exchange for listing and trading of its Equity Shares.

3. The company vide letter dated ...../ .... /...... has received approval from Mumbai Stock Exchange for listing and trading of its Equity Shares.

BOOK RUNNING LEAD MANAGER

ARYAMAN FINANCIAL SERVICES LIMITED

SEBI REGN. NO. : MB/INM 000006807

35, 3rd Floor, Atlanta Building,

Nariman Point, Mumbai - 400 021.

Tel : (022) 282 64 64 / 65 / 66

Fax : (022) 282 64 67.

e-mail : aryaman@bom2.vsnl.net.in

REGISTRAR TO THE ISSUE

INTIME SPECTRUM REGISTRY PVT. LTD.

SEBI REGN NO. - INR000003761

260, Shanti Industrial Estate,

Sarojini Naidu Road,

Mulund (West), Mumbai - 400 080.

Tel. No. : (022) 564 77 31 / 567 27 16.

Fax No. : (022) 567 26 93.

e-mail : isrl@vsnl.com

ISSUE PROGRAMME

BID OPENS ON :

BID CLOSES ON :

ISSUE OPENS ON :

ISSUE CLOSES ON :

TABLE OF CONTENTS

PARTICULARS

Page No.

Definition/Abbreviations

Risk Factors and Management Perceptions Thereof

Highlights

PART - I

General Information

Capital Structure of the Company

Terms of the Present Issue

Tax Benefits

Particulars of the Issue

Company and Management And Project

Management Discussions and Analysis

Basis of issue price

Risk Factors and Management Perception There of

Outstanding Litigation's, Defaults and Material Developments

PART - II

General Information

Financial Information

Statutory and Other Information

Main Provisions of the Articles of Association

Material Contracts and Documents for Inspection

PART - III

Declaration

DEFINITION AND ABBREVIATIONS

Application Form

The form in terms of which the investors shall apply for the Equity Shares of the company.

Allocation Committee

Committee consisting of one representative of each book running Lead Manager

Articles

Articles of Association of Wonder Craft Industries Ltd.

AGM

Annual General Meeting.

Applicant

Any prospective investor who makes an application for shares in terms of the prospectus in the Fixed Price Portion

WCIL

Wonder Craft Industries Limited.

Beneficiary Account

Bid

An indication to make an offer by a prospective investor to subscribe to Equity Shares of the Company at a designated price (which is at or above the floor price), during the Bidding Period and includes all revisions and modifications thereto.

Bid Amount

Means the highest value of the optional Bids indicated in the Bid Form and payable by the Bidder on submission of the Bid in the Book Built Portion

Bid Closing Date

The date after which the Syndicate Members to the offer would not accept any bids; any such date shall be notified through a notice in a English national newspaper, Hindi national newspaper and Regional language newspaper (Where the registered office of Wonder Craft Industries Limited is situated) with wide circulation.

Bid Form/ Bid cum Application Form

The form in terms of which the Bidder shall Bid for the Equity Shares of the company and shall, upon allocation of the Equity Shares by the BRLM and filing of the Offer Document with the RoC, be considered as the application for allotment of the Equity Shares in terms of this Offer Document.

Bid Opening Date

The date on which the Syndicate Members to the offer would start accepting Bids; such date shall be the date notified and communicated through a notice in an English national newspaper, Hindi national newspaper and Regional language newspaper (Where the registered office of Wonder Craft Industries Limited) with wide circulation.

Bidder

Any prospective investor who makes a Bid in terms of this Draft offer Document.

Bidding Period

The period between the Bid Opening Date and the Bid Closing Date inclusive of both days and during which period prospective investors can submit their bids.

BOD / Board

Board of Directors of Arrow Cables Ltd Limited or a committee thereof

Book Built Portion

Means the Net Public offer less than the Fixed Price Portion

BRLM/ Book Runner

Book Running Lead Manager(s), in this case being Aryaman Financial Services Ltd.,

BV / NAV

Book value / Net asset value

Company, Issuer,

Means Arrow Cables Ltd.

CAN

Confirmation of Allocation Note: means the note or advice or intimation for allocation of shares to the Bidders who have been allocated Shares in the Book Built Portion.

CDSL

Central Depository Services (India) Ltd.

CKM

Cable Kilometres

Deemed Date of Allotment

Date of Allotment for the Book Built Portion, which shall be the deemed date of allotment of all the shares issued in this Issue. The allotment in this Issue shall be for all relevant purposes be deemed to have been made from such date.

Depository Participant.

Draft Offer Document

Mean this document which is not a Prospectus under section 60 of the Companies Act, 1956.

Escrow Account of the Company

Means that account opened with the Escrow Collection Bank(s) and in whose favour the bidder will issue cheques in respect of the Bid amount at the time of submitting the Bid and such amounts payable on receipt of CAN where the margin rate specified is nil, and in which account the cheques will be deposited by the syndicate member.

Escrow Account of the Syndicate member

Account opened with one or more of the Escrow Collection Bank(s) and in whose favour the Bidder will issue cheques or drafts in respect of the Margin amount at the time of the submitting the Bid and such amounts payable on receipt of the CAN where the margin rate specified is grater than zero but less than 100% which account the cheque/ demand drafts will be deposited by the Syndicate Members(s).

Escrow Collection Bank(s)

The banks at which the Escrow Account of the company and the syndicate members will be opened and which will act as such, in terms of this Draft offer Document and the Escrow Agreement(s).

EPS

Earnings Per Share.

FIIs

Foreign Institutional Investors, who are registered with SEBI.

Fixed Price potion

Means the portion equivalent to 25% of the net public offer which is reserved for allotment to individual investors who have not participated book built portion or those individual investors who have not obtained any allocation in the Book Built Portion.

Floor Price

The price as advertised by the company prior to the Bid Opening Date and Below which the issue price will not be finalised and below which the bidder cannot bid.

GOI

Government of India.

I.T.Act

Income-tax Act 1961.

Institutional Bidders

Means the Bidders who are institutions specified in Section 4A of the companies act, 1956, Banks, Mutual Funds or Foreign Institutional Investors registered with SEBI.

Issue/Offer

Public Issue of (.......)Equity Shares of Rs.10/- each, at a price of Rs (......) per Equity Shares aggregating an amount not exceeding Rs. 990 lacs.

The Issue includes a Book Built Portion of Rs 594 lacs and a Fixed Prices Portion of Rs 396.

Issue /Offer Price

Price determined by the company in consultation with the Allocation Committee on the pricing date after the Biding Period and which shall be set forth in the Offer Document to be filed with RoC, at which price, the equity shares of the company offered under this Draft offer document will be allotted. The issue size will not be lower than the floor Price. The issue price will be advertised within two days of the allocation for the Issue in the leading English Daily, One Hindi Daily and one Regional Daily.

Issue Closing Date

The date on which the issue closes for subscription.

Issue Opening Date

The date on which the Book Built Portion opens for automatic subscription by Bidders who have received allocation and have paid at least the Issue Price for their allocation into the Escrow Account. This date shall also mean the date on which the Fixed Price Portion opens for subscription by the public.

Issue Period

The period between the Issue Opening Date and Issue Closing date for Fixed Portion and includes both these dates.

Margin Amount

Means the amount arrived at by multiplying the bid amount and Margin rate applicable to that bidder and payable on submission of the Bid in the Book Built Portion. Such amount shall be deposited in the Escrow Account of the Syndicate member.

Margin Rate

Means the percentage of the Bid Amount by the bidder on submission of the Bid in the Book Built Portion as applicable to various categories of Bidders and as finalised in the syndicate agreement filed with the SEBI.

Memorandum

Memorandum of Association of the company i.e. Wonder Craft Industries Limited.

NRI(s)

Non-Resident Indian (s)

NSDL

National Securities Depository Limited

OCB(s)

Overseas Corporate Bodies as defined under Indian laws

Pay-in-Period

For the Book Built Portion, Pay-in-Period means the period commencing on the Bid Opening Date and extending till the Bid Closing Date, during which the bidders have to pay their maximum bid amount into the Escrow Account during the bidding period, unless such requirement of payment, waived by the Syndicate Members for Institutional Bidders. In case of requirement of payments, for Institutional Bidders, during the Bidding Period is waived by the Syndicate Members the closure of the Pay-in-Period for such Bidders, for payment into the Escrow Account, shall be within four calendar days of communication of the allocation list of the Syndicate Members by the BRLM.

Project

The proposal of the company to set up a plant to manufacture Optical Fibres Cables ( OFC ) for which the issue is being raised.

Pricing Date

The date on which the Company in consultation with the BRLM(s) finalises the Offer Price

Prospectus / Final Offer Document/ Offer Document

The Offer Document field with the ROC containing inter alia the Issue price that is determined at the end of the Book Building process, and the number of Equity Shares to be issued, Issue Price and other incidental information

Public Issue Account

Account opened with Bankers to the Issue for collection of Application Money in the Fixed Price Portion and for the purpose of transfer of monies from the Escrow Account on or after the Issue Opening Date.

Proportionate Retail Book Built Portion

Means that portion of the Book Built Portion comprising 15% of the Net public Offer, which is reserved for allocation to individual investor who bid for a minimum of 500 equity shares, in multiples of 100 equity shares, And to a maximum 1000 equity shares in all their options.

Proportionate Whole sale Book Built Portion

Means that portion of Book built portion comprising a minimum of 60% of the net public offer, which is reserved for allocation to Institutional Bidders bidding for more than 1000 equity shares (i.e. a minimum of 1100 equity shares and in Multiples of 100 equity shares thereafter) in all of their bidding options.

RBI

Reserve Bank of India.

Regional Stock Exchange

The Stock Exchange, Vadodara

Registrars to the Issue

INTIME SPECTRUM REGISTRY PVT. LTD.

Retail Bidders(s)

Means the Bidder who are individuals (including NRIs and HUFs) and who have not Bid for higher than 1000 equity share in any of their bidding options in the Book Built Portion.

Revision Form

The form used by the Bidders to modify the quantity of Equity shares or the Bid Price in any of the Bid options as per their Bid Forms and as modified by their subsequent Revision From(s), if any

ROC

Registrar of Companies.

SEBI

Securities and Exchange Board of India constituted under the Securities and Exchange Board of India Act, 1992 (as amended)

Syndicate

The Book Running Lead Manager(s) and Syndicate Members(s)

WCIL

Wonder Craft Industries Limited

In the Draft Offer Document all reference to "Rs" refer to Rupees, the lawful currency of India, reference to one gender also refers to another gender and the word "Lakh" or "Lac" means "one hundred thousand" and the word "million" means "ten lac" and the word "crore" means "ten million".

RISK FACTORS AND MANAGEMENT PERCEPTION

The investor should consider the following risk factors carefully in evaluating the Company and its business before making any investment decision.. This Draft Offer Document contains forward-looking statements that involve risks and uncertainties. None of the Company, the BRLM, the Syndicate Members of their respective affiliates has any obligation or other circumstances arising after the date hereof or to reflect the occurrence of unanticipated events.

INTERNAL RISK FACTORS

(R) Cost of project and means of finance has not been appraised by any bank or financial Institution and are based on the Company's own estimates. The deployment of funds collected in this issue will be at the sole discretion of the management of the company. Thus there will be no independent Body monitoring the use of Proceeds and the Utilisation of issue proceeds is at the total discretion of the management.

(P) The management of the company has in consultation with the Technical Consultants drawn out a business plan for the activities to be pursued for the proposed business. The company believes that it has professional expertise to assess the cost of project and implement the same and at this time does not foresee any borrowing requirements under this plan. Thus the company has not approached any bank or financial Institution for appraisal. The management of the company comprises businessmen with a proven track record and the public issue proceeds will be utilised only for the objects of the issue mentioned in the offer document

(R) The proposed project is mainly financed by the present issue of equity shares and any delay in raising funds from the public issue would adversely effect the implementation and performance of the project.

(R) The Land acquired by the company for the UNIT 2 includes plots purchased from one of the core promoter of the company, Shri. Pravinbhai P Patel.

(P) The land has been purchased at the prevailing market rates in the area and the company found it advantageous in view of its location adjacent to existing units

(R) The registered office of the company is owned by one of the relatives of core promoter and no formal written agreement is being signed between company and the owner of the office.

(R) The company has yet to apply to the bank for the working capital limit of Rs.146.64. lacs

(P) The company is in the process of applying for sanction of additional facilities for UNIT 2 which would be required at the time of the commencement of commercial production.

(R) The land acquired by the company for the proposed project, is yet to be registered in the name of the company.

(P) The company has already submitted all the documents to the concerned Sub Registrar office and it generally takes 4 to 6 months to complete all the formalities of registration. The company does not foresee any problems in this regard.

(R) The Company has yet to place orders for Plant & Machinery amounting to Rs.287.27lacs, Misc. fixed assets amounting to Rs. 20.22 lacs, forming 41.78% of the total project cost.

(P) The Company has already short-listed the suppliers for purchase of plant & machinery & other fixed assets and the orders of the key plant & machinery & other fixed assets will be placed at the as per the schedule of implementation.

(R) A substantial portion of the Company's movable assets has been hypothecated and the company has mortgaged its immovable assets to secure financing facilities with its lenders. If the company were to default on repayment of Debt, its lenders could enforce their security interests in respects of the Company's assets, limiting the Company's ability to carry out its operations and could have a material adverse effect on the Company. In addition, default under the Company's credit facilities could limit the Company's ability to raise additional funds in the future. In event of liquidation of the Company, these creditors will have priority over unsecured creditors of the company and Company's shareholders.

(P) The Company is an existing profit making company and is expanding its operations to achieve economies of scale and to meet the increase in the demand for its products not only from its existing customer base but also from the potential customer base.

(R) The SWOT analysis given of the Company's operations is exposed to certain threats and weaknesses, details for which is given on page no----..

(P) The threat are general in nature and is applicable to any company in the industry. The weakness is being addressed by way of the present expansion plan.

EXTERNAL RISK FACTORS

(R) Competition from existing established companies and the future entrants into the industry.

(P) The Company is confident that its quality products will find a suitable market in the competitive industry as the demand for Corrugated Packaging Products and Paper Shopping Bags will continue to witness consistent growth.

(R) Any adverse change in the government policies may affect the performance and profitability of the company.

HIGHLIGHTS

1. Existing profit making company

2. Strong customer base of leading corporates.

3. Listing proposed at Mumbai, Vadodara and Ahemdabad Stock Exchanges.

NOTES

The investors are advised to refer to the para on 'Basis for Issue Price" before making an investment in this issue.

Investors may note that in case of over-subscription allotment shall be on proportionate basis and will be finalised by the Executive Director of the Vadodra & Mumbai Stock Exchange along with the Lead Merchant Banker and the Registrars to the Issue.

PART I

GENERAL INFORMATION

WONDER CRAFT INDUSTRIES LIMITED

(The Company was incorporated on July 15,1996 in Gujarat, under the provisions of the Companies Act, 1956, (hereinafter referred to as the Act) as a Private Limited company under the name and style " Wonder Craft-Packaging Private Limited " and was subsequently converted into a Public Limited Company and received Fresh Certificate for Incorporation on 9th May 2000 from The Registrar of companies, Gujarat, Dadra and Nagar Haveli. The company was renamed as Wonder Craft Industries Limited on 12th July, 2000.)

Registered Office :

B/3, Neekunj Apartments, Opp. Krishna Talkies, Siddhnath Road, Baroda - 1

Tel. No.: 0265- 42 43 76.

Factory :

P.O. Box No.14, Navi Jitharadi, Karjan Dhavat Road, Tal - Karjan,

Dist - Baroda - 391 204, Tele Fax: 02666 - 32455.

I GENERAL INFORMATION

Wonder Craft Industries Limited (hereinafter referred to as WCIL) ("The Company") was incorporated on July 15, 1996 as a private company and got a fresh certificate of incorporation on 9th May, 2000.

The Book Built portion is for 75% of the total issue size of which 60% of the issue size shall be allotted to Qualified Institutional Bidders (QIBs) on discretionary basis and the remaining 15% shall be available for allotment to non-institutional investors on proportionate basis. The Fixed price portion is for 25% of the total issue size of Rs.100.00 lacs.

AUTHORITY FOR THE PRESENT ISSUE

Pursuant to Section 81(1A) of the Companies Act, 1956, the present offer of 40,00,000 Equity Shares has been authorised vide Special Resolution passed at Extra-ordinary General Meeting held on 15/11/2000

GOVERNMENT APPROVALS

The Company is exempted from seeking a clearance from the Pollution Control Board as it is classified under non-polluting industry as per Circular No.P-328/24403 dtd.28th November 1995 & No.P-328/389 dtd.5th January 1996.

The Company does not require any further letter of intent or industrial license from the GOI for carrying out its current operations or projects proposed in the offer document except as stated in the offer document.

It must be distinctly understood that the Government of India does not take any responsibility for the financial soundness of any scheme or project or correctness of any of the statements made or opinions expressed with regards to them.

DISCLAIMER CLAUSE

AS REQUIRED, A COPY OF THIS OFFER DOCUMENT HAS BEEN SUBMITTED TO THE SECURITIES & EXCHANGE BOARD OF INDIA (SEBI). IT IS TO BE DISTINCTLY UNDERSTOOD THAT THE SUBMISSION OF THE OFFER DOCUMENT TO SEBI SHOULD NOT IN ANY WAY BE DEEMED OR CONSTRUED THAT THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANY RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR PROJECT FOR WHICH THE OFFER IS PROPOSED TO BE MADE, OR FOR THE CORRECTNESS OF ANY OF THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THE OFFER DOCUMENT. LEAD MANAGER, ARYAMAN FINANCIAL SERVICES LTD., HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE OFFER DOCUMENTS ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH SEBI GUIDELINES FOR DISCLOSURE AND INVESTOR PROTECTION FOR THE TIME BEING IN FORCE. THIS REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED OFFER. IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE OFFEROR IS PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL THE RELEVANT INFORMATION IN THE OFFER DOCUMENT, THE LEAD MANAGER IS EXPECTED TO EXERCISE DUE DILIGENCE TO ENSURE THAT THE COMPANY DISCHARGES ITS RESPONSIBILITY ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE, THE LEAD MANAGER, M/S ARYAMAN FINANCIAL SERVICES LTD., HAS FURNISHED TO SEBI A DUE DILIGENCE CERTIFICATE DATED 30.11.2000 IN ACCORDANCE WITH SEBI (MERCHANT BANKERS) REGULATIONS, 1992 WHICH READ AS FOLLOWS:

I WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH COLLABORATORS, ETC., AND OTHER MATERIALS IN CONNECTION WITH THE FINALISATION OF THE OFFER DOCUMENT PERTAINING TO THE SAID OFFER;

II ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY, ITS DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, INDEPENDENT VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE OFFER, PROJECTED PROFITABILITY, PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS MENTIONED IN THE ANNEXURE AND OTHER PAPERS FURNISHED BY THE OFFEROR;

WE CONFIRM THAT

A. THE OFFER DOCUMENT FORWARDED TO SEBI IS IN CONFORMITY WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE OFFER;

B. ALL THE LEGAL REQUIREMENTS CONNECTED WITH THE SAID OFFER AS ALSO THE GUIDELINES, INSTRUCTIONS, ETC., ISSUED BY SEBI, THE GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY IN THIS BEHALF HAVE BEEN DULY COMPLIED WITH; AND

C. THE DISCLOSURES MADE IN THE OFFER DOCUMENT ARE TRUE, FAIR AND ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED DECISION AS TO THE INVESTMENT IN THE PROPOSED OFFER.

III WE CONFIRM THAT BESIDE OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE OFFER DOCUMENT ARE REGISTERED WITH SEBI AND THAT TILL DATE SUCH REGISTRATION IS VALID;

IV WE HAVE SATISFIED OURSELVES ABOUT THE UNDERWRITERS TO FULFIL THEIR UNDERWRITING COMMITMENTS.

V WE CERTIFY THAT WRITTEN CONSENT FROM SHAREHOLDERS HAS BEEN OBTAINED FOR INCLUSION OF THEIR SECURITIES AS PART OF PROMOTERS' CONTRIBUTION SUBJECT TO LOCK-IN AND THE SECURITIES PROPOSED TO FORM PART OF PROMOTERS' CONTRIBUTION SUBJECT TO LOCK-IN, WCILL NOT BE DISPOSED/SOLD/TRANSFERRED BY THE PROMOTERS DURING THE PERIOD STARTING FROM THE DATE OF FILING OF THE DRAFT OFFER DOCUMENT WITH SEBI TILL THE DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT OFFER DOCUMENT.

THE FILING OF OFFER DOCUMENT DOES NOT, HOWEVER, ABSOLVE THE COMPANY FROM ANY LIABILITIES UNDER SECTION 63 OF THE COMPANIES ACT, 1956 OR FROM THE REQUIREMENT OF OBTAINING SUCH STATUTORY OR OTHER CLEARANCES AS MAY BE REQUIRED FOR THE PURPOSE OF THE PROPOSED ISSUE. SEBI, FURTHER RESERVES THE RIGHT TO TAKE UP, AT ANY POINT OF TIME, WITH THE LEAD MANAGER(S) (MERCHANT BANKERS) ANY IRREGULARITIES OR LAPSES IN OFFER DOCUMENT.

DISCLAIMER IN RESPECT OF JURISDICTION

This offer is made in India to persons resident in India (Including Indian nationals resident in India who are majors, Hindu Undivided Families, companies, corporate bodies and societies registered under the applicable laws in India and authorised to invest in shares, Indian mutual funds registered with SEBI, Indian financial institutions, commercial banks, regional rural banks, co-operative banks (subject to RBI permission), Trust registered under the Societies Registration Act, 1860, or any other Trust law and who are authorised in their constitution to hold and invest in shares) and to NRIs, OCBs and FIIs as defined under Indian Laws. This offer document does not, however, constitute an offer to sell or an invitation to subscribe to shares issued hereby in any other jurisdiction to any person to whom it is unlawful to make an offer or invitation to such jurisdiction. Any person into whose possession this offer document comes is required to inform himself about and to observe any such restrictions. Any disputes arising out of this offer will be subject to the jurisdiction of appropriate courts.

GENERAL DISCLAIMER

It should be noted that the Company accepts no responsibility for statements made other than in the offer document or in the advertisements or any other material issued by or at the instance of the Company and that anyone placing reliance on any other source of information would be doing so at his/her own risk. The company and BRLM accepts no responsibility, save to the limited extent as provided in terms of the Memorandum of Understanding entered into by the company and itself and the Underwriting agreement entered into by the Company, BRLM and the Syndicate Members. The BRLM accepts no responsibility for any breach, failure or any default on the part of the Syndicate Members and has been fully indemnified in that behalf.

FILING

A copy of this offer document, along with the documents required to be filed under Section 60 of the Act having attached thereto, has been delivered for registration to the Registrar of Companies, Gujarat, Dadra & Nagar Haveli A copy of the Prospectus has also been filed with SEBI, Mumbai.

A copy of the documents referred to elsewhere in the offer document has been kept open for public inspection at the Registered Office of the Company.

LISTING

Initial Listing Application have been made to Vadodra Stock Exchange. (The Regional Stock Exchange), The Stock Exchange, Ahemdabad and Mumbai Stock exchange for permission to list the Equity Shares and for an official quotation of the equity shares of the Company.

In case the permission to deal in and for official quotation of the shares is not granted by these Stock Exchanges, the issuer shall forthwith repay, without interest, all monies received from applicants in pursuance of this offer document within 70 days from the issue closing date of the fixed price portion and if such money is not repaid within 8 days after the day from which the Company is liable to repay it, the Company shall pay interest as prescribed under Section 73(2) of the Act.

(Trading in the equity shares of the Company shall be dematerialised form only)

IMPERSONATION

Attention of the applicant is specifically drawn to the provisions of sub-section (1) of Section 68-A of the Act, which is reproduced below :

"Any person who-

Makes in a fictitious name an application to a company for acquiring or subscribing for any shares therein.

Otherwise induces a Company to allot, or register any transfer of shares therein to him, or any person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five years."

PROHIBITION BY SEBI

The Company, its Directors or any of the Company's associates or Group Companies have not been prohibited from accessing the capital markets under any order or direction passed by SEBI.

MINIMUM SUBSCRIPTION

IF THE COMPANY DOES NOT RECEIVE A MINIMUM SUBSCRIPTION OF 90% OF THE NET OFFER TO THE PUBLIC INCLUDING DEVOLVEMENT OF UNDERWRITERS WITHIN 60 DAYS FROM THE DATE OF CLOSURE OF THE ISSUE, OR IF THE SUBSCRIPTION LEVEL FALLS BELOW 90% AFTER THE CLOSURE OF THE ISSUE ON ACCOUNT OF CHEQUES HAVING BEEN RETUNRED UNPAID OR WITHDRAWAL OF APPLICATIONS, THE COMPANY SHALL FORTHWITH REFUND THE ENTIRE SUBSCRIPTION AMOUNT RECEIVED. IF THERE IS A DELAY BEYOND 8 DAYS AFTER THE COMPANY BECOMES LIABLE TO PAY THE AMOUNT, THE COMPANY SHALL PAY INTEREST AS PER SECTION 73 OF THE COMPANIES ACT, 1956.

WITHDRAWL OF OFFER

If the price discovered through the Book Building mechanism is lower than the announced/ revised floor price, the company reserves the right to withdraw the offering from the market without assigning any reason thereof.

ISSUE PROGRAMME

BOOK BUILT PROGRAMME

Bidding period

BID OPENS ON :

BID CLOSES ON :

Bids and any revision in bids shall be accepted only between 10.a.m and 3.p.m during the Bidding as mentioned above at the bidding centres mentioned on the Bid cum Application Form.

The Book Building issue shall remain open as the commencement of banking hours and shall close at the close of banking hours on the days as mentioned below:

BOOK BUILT PORTION OPENS ON :

BOOK BUILT PORTION CLOSES ON :

During this period the Escrow Collection Bank shall transfer the funds from the Escrow Account to the Public Issue Account with the Bankers to the Issue.

FIXED PRICE PORTION

The subscription list will open at the commencement of banking hours and will close of banking hours on the days mentioned below :

FIXED PRICE PORTION OPENS ON :

FIXED PRICE PORTION CLOSES ON :

Distribution of information to investors

BRLM/Co-Book Runners/Syndicate Members and the Company shall make all information available to the public and investors at large and no selective or additional information would be available for a section of investor in any manner whatsoever.

ISSUE MANAGEMENT TEAM

BOOK RUNNING LEAD MANAGERS

Aryaman Financial Services Ltd.

SEBI REGN. NO. : INM 000006807

35, Atlanta, 3rd Floor,Nariman Point,

Mumbai - 400 021.

Tel : 022 - 282 64 64 / 65 / 66

Fax : 022 - 282 6467

E-Mail: aryaman@bom2.vsnl.net.in

CO-BOOK RUNNING LEAD MANAGERS

REGISTRAR TO THE ISSUE

INTIME SPECTRUM REGISTRY PVT. LTD.

SEBI REGN NO. - INR000003761

260, Shanti Industrial Estate,

Sarojini Naidu Road,

Mulund (West),

Mumbai - 400 080.

Tel. No. : (022) 564 77 31 / 567 27 16.

Fax No. : (022) 567 26 93.

AUDITORS

S. F. TAI & ASSOCIATES

CHARTERED ACCOUNTANTS,

416, Payal Complex `C',

Near New Stock Exchange,

Sayajigunj,

Baroda - 390 005.

Tel. No. : 36 13 21.

BANKERS TO THE COMPANY

STATE BANK OF SAURASHTRA (KARJAN).

Tal - Karjan, Dist- Baroda

Code No. 316

Ph no.: 02666 - 32 082

SHRI SWAMINARAYAN CO-OP BANK LTD.

Patthargate, Main Branch,

Baroda - 1.

Ph. No.: 0265 - 41 55 74

THE VYSYA BANK LTD.

Overseas Branch, Opera House

Mumbai - 40004.

Ph. No.: 022 - 382 14 70

COMPANY SECRETARY

The Company has not appointed a Company Secretary as required U/s 383A of the Companies Act, 1956. However, the Company is in the process of appointing a Company Secretary.

ESCROW COLLECTION BANKS

SYNDICATE MEMBERS

BANKERS TO THE OFFER

COMPLIANCE OFFICER

Shri. Ulpesh Pandya

B/3, Neekunj Apartments,

Opp. Krishna Talkies,

Siddhnath Road, Baroda - 1

Tel. No.: 0265- 42 43 76.

The investors may contact the aforesaid compliance officer in case of any pre-issue/post-issue related problems such as non-receipt of letters of allotment/share certificate/refund orders/cancelled stock invest etc.

CREDIT RATING

This being an Issue of Equity Shares, no credit rating is required.

TRUSTEES

This being an Issue of Equity Shares, appointment of Trustees is not required.

BOOK BUILDING PROCESS

Book building refers to the collection of Bids from investors, which is based on an indicative price range, the Issue Price being fixed after the Bid Closing date. The principal parties/ intermediaries involved in a book building process are:

1. The company

2. A Book Running Lead Manager who is a category I Merchant banker, in this case, Aryaman Financial Services Limited. The Book Running Lead Manager is also the Lead Merchant Banker.

3. Syndicate Members who are intermediaries registered with SEBI to act as underwriters. Syndicate Members are appointed by the Book Running Lead Manager.

The company has decided to adopt the Book Building Process for obtaining subscription to the Book Building Portion of the present issue. In this regard, the Company has appointed Aryaman Financial Services Limited as the Book Running Lead Manager (BRLM) to the Issue. The BRLM has formed a Syndicate consisting of the Book Running Lead Manager, and the syndicate members to procure the subscription for the equity shares.

The Process of Book Building under SEBI guidelines is relatively new and Investors are advised to make their own judgment about investment through this process prior to making a Bid or application in the Issue.

Investor must :-

1) Check whether the investor is eligible for Bidding.

2) Bidder necessarily needs to have a demat account.

3) Fill up Bid Form as per instruction given elsewhere in this Draft Offer Documents and the Bid form.

UNDERWRITING

Book Built Portion

After determination of the final price and prior to filing of the Final Offer Document with ROC, the company would enter into an Underwriting Agreement with the BRLM and the Syndicate Members for the equity shares proposed to be offered through the Book Built Portion. Equity shares reserved for individual bidders will only be underwritten by the BRLM and the Syndicate members. In terms of the arrangement for the Book Built Portion, the BRLM shall be responsible for bringing in the amount devolved in the event that the Syndicate Members do not fulfill their underwriting obligations.

The details of Underwriting for the Book Building Portion are as given below* :

Sr. No

Name & Address of Underwriter

Date of Agreement

No of shares to be Underwritten.

Underwriting (Amount)

BRLM and the Syndicate Members intend to underwrite --% and --% of the Book Built Portion respectively. However, the final allocation may not correspond to the respective underwriting agreements.

In the opinion of the Board of Directors (based on certificate given to it by BRLM) and in the opinion of BRLM on the basis of the declarations by the syndicate members/underwriters, the resources of all the above mentioned syndicate members/underwriters are sufficient to enable them to discharge their respective underwriting obligations in full. All the above-mentioned syndicate members / underwriters are registered under SEBI under section 12(i) of the SEBI Act, 1992. All letters of underwriting mentioned above have been accepted by the Board of Directors of the company at their meeting held on ------- and letters of acceptance have been issued by the company to the syndicate members/ underwriters.

* This portion has been intentionally left blank and will be filled in before filing of the Final Offer Document with ROC.

Fixed Price Portion

The equity shares proposed to be offered through Fixed Price Portion are fully underwritten. The details of underwriting for Fixed Price Portion are as given below*

Sr.No

Name & Address of the Syndicate Members

Date of Agreement

No of shares to be Underwritten.

Underwriting (Amount)

In the opinion of the Board of Directors and in the opinion of the BRLM, the resources of all the above mentioned Underwriters are sufficient to enable them to discharge their respective underwriting obligations in full. all the above underwriters are registered with SEBI under section 12(i ) of the SEBI Act, 1992. All letters of underwriting mentioned above have been accepted by the Board of Directors of the company at their meeting held on ------- and letters of acceptance have been issued by the company to the syndicate members/ underwriters.

* This portion has been intentionally left blank and will be filled in before filing of the Final Offer Document with ROC.

CAPITAL STRUCTURE OF THE COMPANY

Particulars

Face Value (Rs.)

Aggregate Amount (Rs.)

AUTHORISED (note a)

1,10,00,000

Equity Shares of Rs. 10/- each

11,00,00,000

ISSUED, SUBSCRIBED & PAID UP

26,40,000

Equity Shares of Rs. 10/- each

2,64,00,000

PRESENT OFFER TO PUBLIC {note(b)}

-----------

Equity Shares of Rs. * each

-----------

7,36,00,000

OUT OF THE PRESENT ISSUE

Equity Shares of Rs.* each reserved for firm allotment basis to Promoters/Directors ,their Friends, Relatives & Associates

3,36,00,000

NOW OFFERED IN TERMS OF THIS PROSPECTUS

Equity shares of Rs * each

4,00,00,000

-----------

(a) Book Building portion of

Equity shares of Rs * each

Of Which { note (c)}

(i) Reserved for QIB's

Equity shares of Rs * each

(ii) Reserved for individuals

Equity shares of Rs * each

-----------

3,00,00,000

2,40,00,000

60,00,000

-----------

(b) Net offer to public

Equity shares of Rs 10 each

-----------

1,00,00,000

PAID-UP EQUITY SHARE CAPITAL AFTER THE OFFER {note (d)}

-----------

Equity Shares of Rs.10 each

-----------

10,00,00,000

Share Premium Account {note (d)}

Before the Offer

Nil

After the Offer

Rs. **

Footnotes:

a. Initially the company was registered with an authorized capital of Rs. 1,00,000 and the changes by passing a special resolution took place are as follows: -

Date of Special Resolution

Increase in authorized share capital

(Amt. In Rs.)

Total Authorised Share Capital on that date

(Amt. In Rs.)

27.03.1998

49,00,000

50,00,000

26.02.2000

50,00,000

1,00,00,000

15.11.2000

10,00,00,000

11,00,00,000

b. The number of equity shares to be allocated / allotted in the present Offer to Public will be derived by dividing the amount of Present Offer to Public by the issue price determined through Book Building Process. If the number of equity shares so derived are not a multiple of 100, the equity shares to be allocated/ allotted will be rounded of to the nearest 100. Of such number of shares, 75% will be offered to the bidders in the Book Built Portion and the remaining number of shares will be offered in the Fixed Price Portion.

c. Out of the Book Built Portion, not more than Rs. 240.00 lacs will be available for allocation to Qualified Institutional Buyers and not more than Rs. 60.00 lacs will be available for allocation to non-institutional investors on a proportionate basis.

d. The share premium account balance after the issue will be determined based on the Issue Price discovered through Book Building.

Notes to the Capital Structure:

1. Details of Contribution by Promoters and the friends, relatives & associates of

Promoters/Directors and lock-in period are as follows:

Ref.

Allotment Date & date when made fully paid-up

Consideration (Cash, bonus, kind, etc.)

No. of Equity Shares

Face Value (Rs.)

Issue Price (Rs.)

% to Post Issue Capital*

Lock in Period*

(note 1)

Subscribers to Memorandum

Cash

300

28-07-1998

Cash

4,36,333

14-11-2000

Cash

21,05,990

29.11.2000

Cash

97,377

To be allotted

Cash

33,60,000

Total

60,00,000

* This portion is intentionally left blank and will be filled in after the number of shares are finalised in the proposed issue.

** This portion is intentionally left blank, it will be filled up once the issue price is determined

Note (1): The promoters have undertaken to offer 20% of the post issue capital, for lock-in for a period of 3 years from the date of allotment in this issue or commencement of commercial operation whichever is later. The balance of the shares will be locked in for a period of 1 year from the date of allotment in this issue or commencement of commercial operation whichever is later.

2. The equity shares held by the promoters under the lock-in period, shall not be sold / hypothecated / transferred during the lock-in period. However, inter-se transfers between the promoters named as such would be permitted, provided that the requirement of the lock-in period guidelines continues to apply, to the extent initially prescribed.

3. Details of contribution and lock-in in respect of promoters whose name figure in the paragraph on "Promoters and their Background" :-

S.no.

Name of the promoter

Allotment Date & date when made fully paid-up

Consideration (Cash, bonus, kind, etc.)

No. of Equity Shares

Face Value (Rs.)

Issue Price (Rs.)

% to Post Issue Capital*

Lock in Period*

(note 1)

Mr. Pravinbhai P. Patel.

14.11.00

Cash

100

2,73,600

Mr. Sanjay T. Patel.

Subscriber to memorandum

28.07.98

14.11.00

Cash

100

70,551

1,45,900

Total

4,90251

* This portion is intentionally left blank and will be filled in after the number of shares are finalised in the proposed issue.

** The shares were originally held by a subscriber to memorandum and subsequently transferred in the name of the above said promoter.

4. The subscription by the Promoters/Directors, their friends, relatives and associates for has already been brought in. The Company would furnish a certificate from their Auditors confirming the contribution to SEBI. The Equity Share to be allotted under this category shall be for a minimum amount of Rs. 25,000/- in case of individuals and Rs. 1,00,000/- in the case of Corporate Bodies.

5. There is no buy back or stand-by arrangement or other similar arrangements for the purchase of securities offered through this Offer Document by the Promoters, Directors, Relatives, friends, associates, the BRLM, or merchant bankers directly or otherwise.

6. There has been no issue of shares by the Company for consideration other than cash or out of revaluation reserves at any point of time.

7. Details of the top ten shareholders of the Company 2 years before the date of filing the Draft Offer Document

Sr. No.

Name

No. of Shares

Mansukh V. Patel.

437800

Pravin P. Patel.

273700

Sanjay T. Patel

216551

Bhikabhai P. Patel.

151500

Hiraben P. Patel.

147500

Usha B. Patel.

217377

Thakarbhai B. Patel.

102882

Manish T. Patel.

79150

Priyakant Patel.

55000

10.

Bhikabhai P. Patel. (Kot)

55000

8. Details of the top ten shareholders of the Company 10 days before the date of filing the Offer Document with SEBI are given below:

Sr. No.

Name

No. of Shares

Mansukh V. Patel.

437800

Pravin P. Patel.

273700

Sanjay T. Patel

216551

Bhikabhai P. Patel.

151500

Hiraben P. Patel.

147500

Usha B. Patel.

120000

Thakarbhai B. Patel.

102882

Manish T. Patel.

79150

Priyakant Patel.

55000

10.

Bhikabhai P. Patel. (Kot)

55000

9. Details of the top ten shareholders of the Company as on the date of filing the Offer Document with SEBI are given below :

Sr. No.

Name

No. of Shares

Mansukh V. Patel.

437800

Pravin P. Patel.

273700

Usha B. Patel.

217377

Sanjay T. Patel

216551

Bhikabhai P. Patel.

151500

Hiraben P. Patel.

147500

Thakarbhai B. Patel.

102882

Manish T. Patel.

79150

Priyakant Patel.

55000

10.

Bhikabhai P. Patel. (Kot)

55000

10. The Promoters Group/Directors have not purchased and/or sold/financed any shares of the Company during the past six months.

11. The Company has not raised any bridge loan against the Proceeds of this public issue. However, the Company reserves the right to raise any bridge loan against the proceeds of this public issue if the need so arises.

12. The securities offered through this public issue shall be made fully paid-up or may be forfeited within 12 months from the date of allotment of securities. To this effect the entire amount payable per equity share will be called within twelve months from the date of allotment. If the investor fails to make the shares fully paid-up within twelve months from the date of allotment, the subscription money already paid may be forfeited.

13. The Share holding pattern of the Company as on and the likely shareholding pattern after allotment of equity shares in the issue is as follows :

S. No.

Category of the Shareholders

Existing

After the Offer

No. (Shares)

Core Promoter

4,90,251

18.57

Friends, relatives and associates

21,49,749

81.43

TOTAL

26,40,000

100

14. A Bidder can not make a bid for more than the number of shares offered through book building and an applicant in the fixed priced portion can not make an application for more than Shares offered through fixed price portion.

14. The company presently does not have any intention for alteration of the capital Structure, either by way of split shares or additional issue of capital, preferential or otherwise.

15. An over subscription to the extent of 10% of the fixed portion of the offer can be retained for the purpose of rounding off to the nearer multiple of 100 while finalising the allotment.

TERMS OF THE PRESENT ISSUE

The equity shares being issued /offered are subject to the terms of this offer document, the terms and conditions contained in the Memorandum and Articles of Association of the Company, provisions of the Act, the bid form, the revision form, the application form, the guidelines of listing of securities issued by the Stock Exchange and Government of India and /or any other statutory bodies and the guidelines for Disclosure and investor Protection issued by the Securities and Exchange Board of India ("SEBI Guidelines) and the Depositories Act, 1996, as in force on the date of the offer and to the extent applicable.

AUTHORITY FOR THE PRESENT ISSUE

Pursuant to Section 81 (1A) of the Act, the present issue of Equity Shares has been authorised by the Shareholders of the Company by a Special Resolution passed at the Extra Ordinary General Meeting of the Company held on 15/11/2000.

RANKING OF EQUITY SHARES

The equity shares to be offered shall be subject to the Memorandum and Articles of Association of the company and shall rank pari passu with the existing equity shares of the company, save and except that the holders of the equity shares now being issued, will not be entitled to dividend, if any, declared or paid by the company for any period prior to the date of allotment. They will be entitled to dividend, if any, declared or paid on the equity shares only in such proportion as is attributable to such part of the financial year, after the deemed date of allotment of such equity shares of the Fixed Price Portion and including the Book Built Portion. All the shares being offered through this Draft Offer Document will have similar rights inter-se with regard to dividend and all other rights of Shareholders from the date of allotment.

RIGHTS OF MEMBERS

1. Right to receive dividend if declared.

2. Right to attend general meeting and exercise voting rights unless prohibited by law.

3. Right to vote either personally or if on a poll, by a proxy as well.

4. Right to receive offer for rights shares and be allotted bonus shares.

5. Right to receive surplus on liquidation.

6. Right to nominate

7. Such other rights, as may be available to a shareholder of a public company under the Companies Act.

FACE VALUE/ISSUE PRICE AND TRADEABLE LOT

Equity shares of Face value of Rs.10 each are being offered at a price of Rs (**) per share equity share. The Company undertakes that, at any given time there shall be one denomination of shares and the company shall comply with disclosure and accounting norms as prescribed in this respect, from time to time.

In Terms of the SEBI Guidelines, the trading of securities shall only be in dematerialised form for all the investors

The Tradable lot of the company's equity shares is 1 (one) equity share. Physical Share certificates, wherever issues will be done in the lots of 100 equity shares.

Allotment of the equity shares will be done in the lots of 100 equity shares.

ISSUE STRUCTURE

For the convenience of the Bidders/ Applicants the salient features of the Issue structure are summarised below:-

Book Built Portion

Fixed Price Portion

Institutional Investor

Individual Investor

Amount Available for allocation

Maximum - Rs.240.00Lacs

Maximum -Rs.60.00Lacs

Maximum - Rs.100.00Lacs

Percentage of total issue size

60%

15%

25%

Basis of allotment

Discretionary

Proportionate

Minimum Bid / Application size and multiples

Minimum bid of 1100 equity shares and in multiples of 100 equity shares thereafter.

Minimum bid of 500 equity shares and in multiples of 100 equity shares thereafter.

Minimum application of 200 equity shares and in multiples of 100 equity shares thereafter

Maximum Bid / Application size

A bid cannot be submitted for more than the equity shares offered for subscription under book building portion.

Maximum of 1000 equity shares.

A application cannot be submitted for more than the equity shares offered for subscription under fixed price portion .

Allotment Mode

Compulsorily in Demat

Demat or Physical

Trading

Compulsory in Demat

Who can apply

Institutions specified in section 4A of the Act, Banks, Mutual Funds and FIIs registered with SEBI.

Individuals, HUF (Karta to apply on behalf of HUF).

Individuals, HUF (Karta to apply on behalf of HUF). Who have not Participated in the Book Built portion or did not receive any allocation in the Book Built Portion.

Terms of Payment

As specified under the Section " Terms of Payment " in the Draft offer Document and the Bid cum application form

Notes to the Issue Structure:

Book Built Portion

1) A minimum of 60% of the Net Offer to the public is being reserved for Institutional Bidders and would be allocated to Bidders who have Bid at or above the issue price. The above portion would be allocated in the Discretionary Book Built Portion.

2) The balance of Book built portion ( i.e. other than the portion referred above ) would be reserved for individual investors who bid through the syndicate member provided it is found that their Bids are at or above the offer price. In case of over subscription in this category, allocation will be made on proportionate basis. For the purposes of this paragraph the individual investors means those individuals who bid for up to 10 tradable lots i.e. 1000 equity shares of the company.

3) The company in consultation of with the BRLM will have the discretion to allocate to any of the investors, who have bid, at the offer price.

4) The company in consultation of with the BRLM reserves the right to reject any bid procured by any or all Syndicate Members without assigning any reason therefore.

Fixed Price Portion

1) The present offer also contains a Fixed Price Portion, which will be equal to 25% of the Net Public offer. Individual Investors who for any reason(s) could not participate in the book building Portion during Bidding period or did not receive an allocation or CAN from the Syndicate member through whom they participated, Can apply for equity shares out of the fixed price portion. However, investors who have been successful in getting an allocation in the book Built Portion are barred from applying for the Fixed Price Portion.

2) The equity shares to be offered under the fixed price portion shall also be made available at the offer price. The Fixed Price Portion shall be available for subscription during the issue period only and not during the Bidding Period.

3) Investors may note that in case of over subscription in the Fixed Price, allotment will be made on proportionate basis, in consultation with regional stock exchange. In case of under subscription in the fixed price portion, the company has the option to allocate such under subscribed equity shares to which ever category of investor it deems fit.

Conversion Option of Bid into a application in the Fixed Price Portion

1. Only Individual Bidders who for any reason(s) did not receive an allocation or CAN from the Syndicate Members through whom they participated, shall have the option of being considered for allotment in the Fixed Price Portion subject to their fulfilling the following conditions:-

2. The Individual Bidders should clearly exercise the option of conversion of their Bid in the Book Built Portion into an Application in the Fixed Price Portion by filling the relevant portion in the Bid Form. In case the Individual Bidders does not exercise such option or does not fill the relevant portion of the Bid Form properly, it shall be deemed that the individual Bidder has not opted for such conversion option.

3. The Individual Bidders should not have received an allocation of any Equity Shares in the Book Built Portion. The Registrars to the Issue without any reference or intimation to the Individual Bidders who opts for the conversion will verify this aspect.

4. The Individual Bidders should have Bid for the Equity Shares at or above the Issue Price.

5. The Individual Bidders should have deposited the entire Bid amount in the Escrow Account at the time of making the Bid. The amounts deposited by the Individual Bidders into the Escrow Collection Banks under the Book Built Portion shall be entirely transferred into the Public Issue Account. The Bid of the Individual bidder who exercise the conversion option will be considered to be an application for the Fixed Price Portion for such number of equity shares (rounded off to the lower multiple of 100) as are derived by dividing the Bid Amount paid by such Individual Bidders by the Issue Price.

6. Individual Bidders who exercise the above conversion option, but do not fulfil any of the above conditions will receive refund from the Escrow Account in terms of this Draft Offer Document. The refunds payable for excess amounts deposited by the individual Bidders, who have exercised conversion options, which fulfils the above conditions, shall be paid out of the Public Issue Account as per the terms of the Fixed Price Portion.

7. Bidders option for the conversion option cannot make another application in the Fixed Price Portion as first/sole applicant. In case the Bidder makes such additional application(s), all the applications including the application resulting from the conversion of the Bid, would be treated as multiple applications and would be liable to be rejected.

8. It is hereby clarified that by the exercise of the spill over option, the bid form shall be deemed to convert into an Application Form for the Fixed Price Portion, if all the above conditions are fulfilled.

SIZE OF BID/APPLICATION AND TERMS OF PAYMENT

Book Building Portion

Institutional Segment

In case of the Institutional Bidders in the Discretionary Book Built Portion, bid must be for a minimum of 1100 Equity Shares and in multiples of 100 Equity Shares thereafter. A bid cannot be submitted for more than the equity shares offered for subscription under Book Building Portion. The bid price has to be paid at the time of bidding based on the highest bidding option of the bidder. Where payment of bidding is waived at the discretion of the Syndicate Member the offer price is to be paid within 3 days of communication by the BRLM of the list of bidders who have been allocated equity shares to the Syndicate Members. Where a Bidder has been allocated lesser number of shares than he or she had bid for the excess amount paid on bidding, if any will be refunded to such Bidder.

The Non-Institutional Segment

In case of the Individual Bidders in the Discretionary Book Built Portion, bid must be for a minimum of 500 Equity Shares and in multiples of 100 Equity Shares thereafter upto a maximum of 1000 equity shares.

The terms of payment for bidders in the Non-institutional segment of the Book Built Portion of the offer would be mutatis mutandis similar to those for the institutional Portion of the Book Built Portion of the Offer.

Fixed price portion

Application must be for a minimum of 200 equity shares and in multiples of 100 thereafter. The entire application price has to be paid at the time of application. A application cannot be submitted for more than the equity shares offered for subscription under fixed price portion .An applicant, who has been allotted lesser number of shares than he she had applied for, will be refunded the excess amount paid on application.

In case of allotment of shares, any excess amount paid on application shall be adjusted towards the amount due on allotment and the balance amount, if any, will be refunded by the company to the applicants.

INTEREST IN CASE OF DELAY IN DESPTACH OF ALLOCATION NOTE/ ALLOTMENT LETTER/ REFUND ORDERS.

The Company agrees that allocation of securities for the Book Built Portion shall be made and refund orders (if any) shall be despatched to bidders within 15 days of the Bid Closing Date for the Book Built Portion, failing which the Company will pay interest @ 15% per annum (except in case of bids accompanied by Stockinvest) on the subscription amount. However application received after the aforesaid date in fulfilment of underwriting obligations, shall not be entitled for the said interest.

The Company agrees that the allotment of securities offered to the public through the Fixed Price Portion shall be made within 15 days of the Issue closing Date for the Fixed Price Portion of the public issue. The company further agrees that it shall pay interest @ 15% per annum on the subscription amount if allotment is not made within 15 days from the date of closure of the fixed price portion of the Public Issue. However applications received after the closure of the Issue in fulfilment of underwriting obligations to meet the minimum subscription requirement, shall not be entitled for the said interest. The Company also agrees that as far as possible refund orders shall be despatched within 15 days from the closure of the fixed price portion of the Public Issue failing which the Company will pay interest @ 15% per annum (except in case of applications accompanied by Stockinvest) on the amount of refund due.

ARRANGMENTS FOR DISPOSAL OF ODD LOTS

The Company has not made any arrangements for disposal of odd lots. However, the trading in the equity shares of ACL will be exclusively in the dematerialised form.

NOMINATION FACILITY TO INVESTOR

As per Section 109 A of the Companies Act, 1956, the sole or first Bidder or applicant, along with other joint bidders or applicant may nominate any one person in whom,in the event of the death of the sole bidder or applicant or in case of joint bidders or applicants, death of all the bidders or applicants, as the case may be, the equity shares allotted, if any, shall vest.A person, being a nominee, becoming entitled to the equity shares by reason of the death of the original holder(s) shall in accordance with section109 A of the Act, be entitled to the same advantages to which he would be entitled if he were the registered holder of the equity share(s). Where the the nominee is a minor, the holder(s) may make a nomination to appoint, in the prescribed manner, any person to become entitled to equity share(s) in the event of his or her death during the minority. A nomination shall stand rescinded upon a sale of equity shares by the person nominating. A buyer will be entitled to make a fresh nomination in the manner prescribed. Fresh nomination can be made only on the prescribed form available on request at the registered office of the company or the Registrar to the issue.

Any person who becomes a nominee by virtue of the provisions of the section 109 A of the act, shall upon the production of such evidence as may be required by the board, elect either :

1. To register himself as a holder of equity shares or

2. To make such transfer of the equity shares, as the deceased holder could have made.

Further, the board may at any time give notice requiring any nominee to elect either to be registered himself or to transfer the equity shares, and if the notice is not complied within 90 days, the board may thereafter withhold payment of all dividends, bonuses or other monies payable in respect of the equity shares until the requirements of the notice have been complied with.

HOW TO APPLY - AVAILABILITY OF FORMS, PROSPECTUS AND MODE OF PAYMENT

I. Book Built Portion

a) Bid Form

Bidders shall only use the Bid Form for the purpose of making a Bid in terms of this Draft Offer Document. The Bid Form should bear the stamp of the Syndicate Member or else it would be rejected. The Bidder shall have the option to make a maximum of three Bids in their Bid Form and such options shall not be considered as multiple applications.. Upon the allocation of shares and dispatch of CAN and filing of Draft Offer Document with the ROC, the Bid Form shall be considered as the application form and upon issue of share, shall function as an authority given to the Company by the Bidder to sign the authority pursuant to which the shares in physical or demat form will be transferred. On filling the Bid Form, the Bidder is deemed to have authorised the Company to make the necessary changes in the Draft Offer Document and the Bid Form as would be required for filing of Draft Offer Document with the ROC and as would be required by the ROC after such filing, without any prior or subsequent notice of such changes to the Bidder.

Do's:

1) Check who can Bid

2) Fill up the Bid Forms after reading the instruction carefully regarding:

a) Payment details

b) Bank details

c) Usual Signatures

d) PAN/GIR Nos.

e) DP details

3) Enter correct details of DP and Beneficiary Account as allotment in Institutional Book Built Portion is compulsorily in demat form and trading of equity shares of the company will be in demat form only. The syndicate member(s) has the right, but not the responsibility, to ask for proof of the DP Account.

4) Submit Bid at Bidding Centres only and obtain Transaction Registration Slip (TRS) from the Syndicate Members.

5) Bid Form should bear the stamp of the Syndicate Member, if not, the same would be liable to be rejected.

6) In case the Bidder wants to revise the Bid, The Bidder should submit the Revision form to the same Syndicate Member along with the TRS through whom the Original Bid was placed and obtain a revised TRS for the revised Bid.

Don'ts :

1) Do not Bid for lower than minimum Bid Size applicable to the Bidder.

2) Do not bid at less than the Floor Price.

3) Do not bid at cut-off price.

4) A bidder should not Bid on another Bid Form after his/her Bids on one Bid Form have been submitted to any Syndicate Member: the same may be rejected as multiple Bidding.

5) Bid amount is not to be paid in cash otherwise the same may be rejected.

6) Bid forms should not be sent by post, but hand delivered.

b) Who can Bid

1. Indian nationals resident in India who are majors, in single or joint names (not more than three)

2. Hindu Undivided Families (HUF) in the individual name if the Karta.

3. Companies, Corporate Bodies and Societies registered under the applicable laws in India and authorise to invest in these shares.

4. Indian Mutual Funds registered with SEBI.

5. Indian Financial Institutions, Commercial Banks and Regional Rural Banks, Co-operative Banks subject to permission from RBI.

6. Trust registered under Societies Registration Act, 1860, or any other Trust Law and are authorised under their constitution to hold and invest in shares.

7. Non Resident Indians (NRIs), Overseas Body Corporate (OCBs) and Foreign Institutional Investors (FIIs) on non-repatriation basis subject to applicable laws and RBI permission.

Bids from Indian Nationals, Hindu Undivided Families applying through Karta and NRIs applying for upto 1000 Equity Shares would be considered as Individual Bidder

Note : Book Running Lead Managers, Syndicate Members and any associates of Book Running Lead Managers, Syndicate Members (except Asset Management Companies of the mutual funds, banks and Indian Financial Institutions) cannot participate in the Book Built Portion. Further the BRLM and the Syndicate Member(s) shall not be entitled to subscribe to the Issue in any manner, except as per the terms of the underwriting agreements.

Steps to be taken upfront by the Bidders

a) To check whether he/she is eligible for Bidding.

b) Bidder necessarily needs to have a demat Account

c) Filling up of Bid Forms as per instructions given elsewhere in the Draft Offer Document and the Bid Form.

c) Bidding Process

1. The BRLM/Syndicate Members will circulate copies of the Draft Offer Document along with the Bid Form to their clients.

2. Investor desirous of obtaining the Draft Offer Document along with the Bid Form can obtain the same from the Registered Office of the Company or from any BRLM or from a Syndicate Member.

3. The Company and the BRLM shall declare the Bid Opening Date and Bid Closing Date and publish the same in three widely circulated newspapers (one each in English, Hindi and regional). This advertisement shall contain the salient features of the Draft Offer Document as specified under Form 2A, the method and process of bidding and the names and addresses of the BRLM/Syndicate Members. The BRLM/Syndicate Members shall start accepting bids from the bidders from the Bid Opening Date.

4. Investors who are interested in subscribing to the Company's Equity Shares should approach any of the BRLM/Syndicate Members or their authorised agent(s) to register their bid.

5. The Bids should be compulsorily submitted on the prescribed Bid Form only.

d) Escrow Mechanism

The Company and the Syndicate Members shall open Escrow Accounts with one or more Escrow Collection Banks in whose favour the Bidder shall make out the cheque or demand draft in respect of his or her Bid and/or revision. The Escrow Collection Banks will act in terms of this Draft Offer Document and an Escrow Agreement to be entered into between the BRLM, the Company/respective syndicate member, the Escrow Collection Bank, and the Registrars to the Issue. The Escrow collection Banks shall maintain the monies deposited by the Bidders in the Escrow account of the company for and on behalf of the bidders. The Escrow Collection Bank shall not exercise any lien over the monies deposited therein, and shall hold the monies therein in trust for the Bidders, and on or after the Issue Opening Date transfer the monies to the Public Issue Account with the Bankers to the Issue as per the terms of the Escrow Agreement.

The Bidders are informed that the Escrow Mechanism is not prescribed by SEBI and the same has been established as an arrangement between the Escrow Collection Bank(s), the company, the Registrars to the Issue and the BRLM, the facilitate collections from the Bidders.

e) Payment Into The Escrow Collection Account

Each Bidder shall, with the submission of the Bid cum Application Form draw a cheque/demand draft/stockinvest for the maximum amount of his bid in favour of the Escrow Account of the Escrow Collection Bank and submit the same to the Syndicate Member(s). Bid form accompanied by cash shall not be accepted the maximum bid price has to be paid at the time of bidding based on the highest bidding option of the bidder. Where the Bid is at cut-off price, the investor will be required to make payment at the highest price in the indicative price band. The Syndicate Member(s) shall deposit such cheque/demand draft/stockinvest with the Escrow Collection Bank, which will hold the monies for the benefit of the Bidders till such time as the Issue Opening Date. On the Issue Opening Date, the Escrow Account, as per the terms of the Escrow Agreement, into the Public Issue Account with the Bankers to the Issue.

The Syndicate Member(s) may at their discretion waive such requirement of payment at the time of the submission of the Bid Form for Wholesale Bidders. Where such payment at the time of bidding is waived at the discretion of the Syndicate Member or where there is a shortfall as a result of cut-off price being more than the highest price in the indicative price band, the Issue Price or the difference, as the case may be would be paid, favouring the Escrow Account, within 3 days on communication by the BRLM of the lost of Bidders who have been allocated Equity Shares to the Syndicate Members. If the payment is not made favouring the Escrow Account within the time stipulated above, the Bid of the Bidder is liable to be cancelled.

However, if the BRLM/Syndicate Member does not waive such payment, the full amount of payment has to be made and the BRLM/Syndicate Member will not accept partial payment.

The payment instruments for payment into the Escrow account of the company should be drawn in favour of "ESCROW ACCOUNT- WCIL PUBLIC ISSUE".

The payment instruments for payment into the Escrow account of the syndicate member should be drawn in favour of "NAME OF SYNDICATE MEMBER-ESCROW ACCOUNT- WCIL PUBLIC ISSUE".

Where the bidder has been allocated lesser number of Equity Sharers than he or she bid for, the excess amount paid on biddings, if any, after adjustment for allocation, will be refunded to such bidder within 15 days from the Date of Bid Closing. In case of Individual Bidders who have exercised the conversion option and are eligible allotment in the Fixed Price Portion, the entire amount will be transferred to the Public Issue Account and the excess amount if any after allotment will be refunded to such Individual Bidders in terms of the procedure for refunded for the Fixed Price Portion. (Also refer to the "Para Conversion Option of Bid into a Application in the Fixed Price Portion")

f) Bidding

Each Bid Form will give the Bidder the choice to Bid for up to three optional price and demand (i.e. number of shares bid for) levels. The Price and demand options submitted by the Bidder in the Bid Form will be treated as optional demands from the Bidder and will not be cumulated. After discovery of the Issue Price, the maximum number of shares bid for by a Bidder at or above the issue price will be considered as his only Bid during the allocation process.

The Bidder cannot bid on another Bid Form after his bids on one Bid Form have been submitted to any Syndicate Member. Submission of a second Bid Form to either the same or to another Syndicate Member will be treated as multiple bidding and is liable to be rejected either before entering the Bid into the electronic bidding system or at any point of time prior to the allotment of Equity Shares in the Issue.

Along with the bid Form, all bidders will submit a cheque or draft payable to the Escrow Account or Stockinvest (subject to applicable laws/ guidelines) favouring the company. The amount of such payment will have to be considered at the highest value of the optional bids submitted in the Bid Form. If one of the Bidder's option is at the cut off price, the payment will have to be considered at the highest price in the price band for that option. The syndicate member can waive this requirement of payment to the Escrow account for any bidder as per his discretion. However, if the syndicate member does not waive such payment, the full amount of payment has to be made and the Syndicate Member will not accept partial payment.

The BRLM/Syndicate Member will enter each option into the electronic biding system as a separate bid and generate a Transaction Registration Slip (TRS) for each option and give the same to the Bidder. Therefore, a Bidder can receive up to three for each Bid Form.

The Bid Forms should bear the stamp of the Syndicate Members; otherwise, the same would be rejected.

g) Bids At Different Price Levels

The floor price of Rs.10 per share is likely to be advertised on -----, 2000 prior to the Bid Opening Date in English Daily, Hindi Daily and a regional daily. The company and the BRLM reserve the right to finalise the Issue Price at or above the Floor Price without prior approval of or information to the bidders. Any change in the price will be widely advertised through advertisements released in the above dailies. The Offer price as determined by the Company in consultation with the BRLM may be above the floor price.

Bidders will have their bids at a price, which may be at or above the floor price. The bids above the floor price will be in additions of Rs.2/- thereof. Bids at intermediate price will be treated as bids at the price, which is the intermediate, lower multiple of Rs.2/-. However, the Bidders cannot bid below the floor price.

An investor will not have an option of putting a "cut off Price Bid" and such bids will be treated as invalid.

h) Electric Registration Of Bids

The BRLM/Syndicate Members will register the Bids using the on-line facilities of NSE (National Stock Exchange)/BSE (The Stock Exchange, Mumbai). There will be atleast one BSE on-line connectivity to each of the Biding Centres.

NSE/BSE/ASE will offer a screen-based facility for registering Bids for the Issue. This facility will be available on the terminals of BRLM/Syndicate Members during the Bidding Period. BRLM/Syndicate Members can also set up facilities for off-line electronic registration of bids subject to the condition that they will subsequently download the off-line data file into the on-line facility for Book Building.

At the time of registering the Bid, the BRLM/Syndicate Members shall enter the following details of the investor in the on-line system:

1. Name of the Investor

2. Investor Category - Individual / HUFs / FIs( Financial Institution and Banks) /Corporate / NRI / OCB / FII / MF.

3. Number of Shares

4. Bid Price

5. Bid Form Number

6. Whether payment is made upon submission of Bid Form.

After the above data is entered, the system will generate a Unique Transaction Identification Code (UTIC), which will indicate the Syndicate Members' identity and the investor's registration with him. A system generated Transaction Registration Slip (TRS) (or the Order Confirmation Note) will be given to the Investor as a proof of the registration of each Bid Option. It is the Bidders responsibility to obtain the TRS from the Syndicate Member. The registration of the Bid by the Syndicate Member does not guarantee that the shares shall be allocated either by the Syndicate Members or the Company or the BRLM .

Such TRS will be non-negotiable and by itself will not create any obligation of any kind.

The BRLM/Syndicate Member has the right to vet the Bid. Consequently, the Syndicate Member also has the right to accept the Bid or reject it without assigning any reason. In case the Syndicate Member does not waive the requirement of payment into the Escrow Account during the Bidding Period, the Bid of the Bidder shall not be rejected except on technical grounds.

Bidders may note that the Syndicate Member(s) are bound by the terms and conditions of the undertakings signed by them with the relevant Stock Exchange(s) and by the circulars and instructions issued by the exchanges there under.

It is to be distinctly understood that the permission given by BSE to use their network and the software of the Online IPO System should not in any way deemed or constructed that the compliance with various statutory and other requirements by the Company, BRLM etc. are cleared or approved by BSE, nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the compliance with the statutory and other requirements nor does it take any responsibility for the financial or other soundness of this Issuer, its promoters, its management or any scheme or project of this Issuer.

It is also to be distinctly understood that the approval given by BSE should not in any way be deemed or construed that the Prospectus has been cleared or approved by BSE; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Prospectus; nor does it warrant that the securities will be listed or will continue to be listed on the Exchange.

The Company clarifies that every person who desires to apply for or otherwise acquire any securities in this issue may do so pursuant to an independent enquiry investigation and analysis and shall have no claim against 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 any reason whatsoever.

i) Build Up Of The Book & Revision Of Bids

1. Bids registered by various Bidders through their BRLM/Syndicate Member(s) shall be electronically transmitted to the NSE/BSE/ASE mainframe on an on-line basis.

2. The book would get built up at various price levels. This information will be available to the BRLM on an on-line basis.

3. During the Bidding Period, any Bidder who has registered his or her interest in the equity shares at a particular price level is free to revise his or her Bid using the printed Revision Form.

4. The revision can be made in both the desired quantity of shares and / or the Bid Price by using the Revision Form. The Bidder must fill his or her Bid Form Number, details of all the options in his or her Bid Form or earlier Revision Form and revisions for all the options as his Bid form or earlier revision Form. For example if a Bidder has bid in three options in the Bid Form and he is changing only one of the options in the Revision Form, he must fill the details of the other two options in the Revision Form as unchanged. The Syndicate Member will not execute incomplete or inaccurate Revision Forms.

5. The Bidder can make this revision any number of times during the Bidding Period. However, for any revision(s) in the earlier Bid, the Bidder will have to use the services of the same Syndicate Member through whom he has placed the original Bid, otherwise the revised bid is liable for rejection.

6. In case of revision of the Bid it should be accompanied by payment in the form of cheque or demand draft or stockinvest for the balance amount of the revised Bid if any, to be paid on the account of the revised Bid. The excess amount paid, if any shall be returned to the Bidder at the time of refunding, according to the terms of this Draft Offer Document. The Syndicate Member may at his sole discretion waive the payment requirement at the time of one or more revisions. The Bidder has a sole responsibility of accurately paying the incremental amount payable on revision of bids and the Syndicate Members will not be responsible for the consequences of any short payment. If the sum total of cleared balance on account of the original payment of Bid Amount and incremental amounts paid on revision thereafter is short of the total amount payable by the bidder, then the bid of the bidder or any allocation made thereon is liable to be cancelled at any point of time upto allotment of the equity shares.

7. When a Bidder revises his or her bid, he or she shall surrender the earlier TRS and get a revised TRS from the Syndicate Member. It is the responsibility of the Bidder to request for and get the revised TRS, which will as proof of his / her having revised the previous Bid.

8. In case of discrepancy of data between NSE/BSE/ASE and the Syndicate Member, the decision of the BRLM based on the records of NSE/BSEASE is final and bidding to all concerned.

j) Technical Grounds On Which Bids Can Be Rejected.

1. The syndicate members registrars to the issue BRLM or the company will have the right but not the obligation to reject any Bid one or more of the following grounds :-

2. If the number of equity shares bid for is lower than the minimum Bid size as applicable in the respective category.

3. If the bid amount/margin amount paid is lower then the amount payable as per the draft offer document and bid form.

4. If the bid amount/margin amount is not paid as per the payment instructions in the draft offer document and the bid form.

5. If the bid form is not complete or not duly filled in as per the instructions in the draft offer document and the bid form.

6. A Bidder bids on another Bid Form after his/her bid on one Bid Form has been submitted to any Syndicate Member the same may be rejected as multiple Bidding.

7. A stamp of a syndicate member does not accompany the bid form.

8. If the Syndicate members or the registrars to the issue have reasons to deem the bid to be multiple bidding.

9. If the bid forms are not delivered by the bidders within the time prescribed as per the bid form, bid opening date advertisement and the draft offer document and the bid form.

10. If the bid form does not conform to any other terms and instructions laid out in the Draft offer document and the Bid form.

k) Payment Instructions for Book Built Portion:

Cash payment will not be accepted by the BRLM/Syndicate Members for the Book Built Portion. Payment may be made by way of cheque or stockinvest (subject to applicable laws/guidelines) or demand draft drawn on any bank, including a cooperative bank which is situated at and is a member or sub-member of the Bankers Clearing House located at the place where the Bid Form or Revision Form is submitted. Outstation cheques or bank drafts, or bank draft drawn on bank not participating in the clearing process will not be accepted. Non-MICR cheque will not be accepted in cities where use of MICR cheque is prevalent. Bidders based in cities other than bidding centres can give demand drafts payable at the location of the Bidding Centre where the Bid cum Application Form or Revision Form is submitted. Such Bidders based in cities other than the bidding centres can submit the Bid cum Application Forms or Revision Forms only by hand delivery to the BRLM/Syndicate Member. Bids sent by post will not be registered by the BRLM/Syndicate Member.

All cheques or drafts must be made payable to Escrow Collection Bank(s) and favouring "Name of the Bank Escrow A/c WCIL-Public Issue" and crossed "A/c Payee Only". A separate cheque or bank draft or Stockinvest must accompany each Bid Form and Revision Form. Bidders are advised to mention the serial number of the Bid cum Application Form on the reverse of the instruments to avoid misuse of instruments submitted along with the bids for the Equity Shares.

Where the maximum Bid for equity shares by a Bidder is for total value of Rs. 50,000 or more, i.e. the actual no of securities bid for multiplied by the bid price, is Rs 50,000 or more the bidder or in the case of a bid in joint names, each of the bidders should mention his or her Permanent Account Number (PAN) allotted under Income-tax Act, 1961 or where the same has not been allotted, the GIR Number and the Income-Tax Circle/ Ward/ district. In case, neither the PAN nor the GIR number has been allotted, the Bidder must mention " Not Allotted" in the appropriate place. Bid Forms without this information will be considered incomplete and are liable to be rejected.

l) Payment by Stock invest

The bidder who is an individual or a mutual fund has the option to use stockinvest in lieu of cheques or bank drafts for payment of application money, subject to applicable laws guidelines. The bidder using stockinvest should submit the Bid Form or Revision Form along with the instrument to the collection centre of the Syndicate Member mentioned in the Bid Form. Stock-invest instruments are payable at par at all the branches of the issuing bank and as such, outstation stockinvest instruments can be attached to the Bid Form or Revision Form. Stockinvest can be obtained from any Bank issuing such instrument in various denominations by making the necessary applications and depositing the amounts with the respective banks. The stock-invest will be issued to the Bidder in blank format after authentication of the date of offer by the designated branch. The stock-invest duly completed should be submitted along with the Bid Form or Revision Form to the collection centre of the Syndicate Member mentioned in the Bid Form

The Bidder may approach the banks concerned for obtaining stockinvest and detailed instructions for same. The stock-invest should be made payable in favour of "Wonder Craft Industries Limited- Public Issue"

The Bidder has to fill in the following particulars:

1. Title of the account i.e. "Wonder Craft Industries Limited- Public Issue"

2. The number of equity shares bid for;

3. The maximum amount payable as per the options in the Bid Form or Revision Form;

4. The name and address where the stock-invest should be returned in case of non-allotment; and

5. The Bid Form number on the reverse of the instrument.

The Bidder should thereafter sign the instrument. The stock-invest should bear "Account Payee" and "Non-Negotiable" crossing and will be payable only to the account of the Issuer Company. i.e. "Wonder Craft Industries Limited- Public Issue". Stock-invest should be utilised by the purchaser(s) and the purchaser's name / name of one of the purchasers should be invariably indicated as the first applicant in the composite application form. Thus if the signature of the purchaser on the stock-invest and the signature of the first applicant on the application form does not tally, the application would be treated as having been accompanied by a third party stock-invest and is liable for rejection.

Stock-invests are to be used by the purchaser(s) within 10 days of its issue and for this purpose the last day for use of the stock-invest for submitting application to the Bankers to the Offer should be indicated on the face of the stock-invest with a notation "To be used before ____________".

No refund will be made to those Bidders using stock-invest for payment of money due under the Bid Form or Revision Form. In case of non-allotment of equity shares, the cancelled stock-invest instrument will be returned to the Bidder, who will have to approach the issuing bank branch for lifting of lien.

Applications with stock-invest not fulfilling the above criteria are liable to be rejected. The service charges, if any, for procuring the stock-invest shall be borne by the Bidder.

The applicant should not fill in the portion to be filed up by the Registrar to the Offer (right hand portion of the instrument). The Registrar to the Offer will fill up the right hand portion of the stock-invest indicating the equity shares allotted to the applicant and also the amount calculated as follows:

In case of full allotment, the number of equity shares and the amount on the right hand side will be the same as the left-hand side of the instrument.

In case of partial allotment, the number and the amount after adjusting allotment money, if any, payable in respect of equity shares so allotted, filled up by the Registrar (on the right hand side of the instrument) will be less than or equal to the number and the amount filled up by the applicant (on the left hand side of the instrument).

In case the allotment is nil, the number and the amount filled up by the Registrar on the right hand side of the instrument will be nil.

The Registrar to the Offer has been authorised by the Company vide a Board Resolution passed on -----/2000 to sign on behalf of the Company for realising the proceeds of the stock-invest of the successful allottees from the issuing bank or to affix non-allotment advice on the instrument or to cancel the stock-invest of the non-allottees or partly successful allottees who can enclosed more than one stock-invest. The cancelled instrument shall be sent back by the Registrar to the Investor directly.

Only mutual funds and individuals are entitled to use stock-invest. There is a ceiling of Rs 50,000/- per individual per stock-invest for individual applicants. This ceiling is not applicable for mutual funds.

The above information is given for the benefit of the investors and the company is not liable for any modification of the terms of stock-invest or procedure there of by issuing banks. Inquiries relating to stock-invest may be addressed only to the registrar to the offer and not to the issuing bank.

m) Disposal Of Application Made By Stock-Invest

The procedure for disposal of applications made by cash/cheque/demand draft will apply mutatis mutandis to stock-invest except the following:

In case of non-allotment, stock-invest will be cancelled by the Registrar to the Offer and returned to the Bidder. The Stock-invest will bear stamps such as "CANCELLED" and "NOT ALLOTTED" across the face of the instrument. The issuing bank will lift the lien on the account on surrender of the same by the Bidder. In case the cancelled stock-invest is not received by the investor from the Registrar to the Offer, lien will be lifted by the issuing branch on expiry of four months from the date of offer against an indemnity bond from the applicant.

In case of allotment / partial allotment, the Registrar to the Offer shall fill in the amount in the stock-invest which would be less than or equal to the amount filled by the bidder and present the stock-invest duly discharged on behalf of the Company for collection of payment to the extent of allotment to the respective issuing Bank. The issuing bank will lift the lien on the balance amount, if any, of the deposit.

Inquiries relating to shares applied through stock-invest may be addressed only to the Registrar to the Offer and not to the issuing bank.

Multiple applications under a stock-invest are liable to be rejected, as each application is required to be accompanied by a separate instrument.

Above information is given for the benefit of the Bidder and the company is not liable for any modification of terms of stock-invest or procedure thereof by issuing bank.

1. Shares and in multiples of 100 Equity Shares thereafter subject to a maximum of 1000 Equity Shares.

2. For Institutional Bidders, the Bid must be for a minimum of 1100 Equity Shares and in multiples of 100 Equity Shares thereafter. A Bid cannot be submitted for more than the sharers offered for subscription under Book Building Portion.

3. In single name or in joint names (not more then three).

4. A Magistrate under his or her official seal must attest Thumb impressions and signatures other than in the languages specified in the Eight Schedule in the Constitution of India.

5. The company reserves the right to reject any Bid without assigning any reason for such rejection and consequent refunds shall be made by cheque or pay order or draft and will be send to the Bidder's address at the applicant's risk.

ii) Bidder's Bank Details.

The name of the Sole or first Bidder's Bank, branch, type of account and account numbers must be filled in the Bid cum Application Form. This is required for the Bidder's own safety so that these details can be printed on the refund orders. Bids without these details are liable to be rejected.

iii) Bidder's Depository Account Details.

All the Bidders have an option to get their Equity Shares using the Depository mode. It is mandatory for Wholesale Bidders to get their shares using their Depository Mode. All Bidders desirous of availing this facility should mention their Depository Participant's name, DP-ID and Beneficiary Account Number in the Bid Form. In case a Bidder seeks allotment of certain number of shares in dematerialised form and the remaining in physical form, these would be clubbed for the purpose of arriving at the basis of allotment. Applicants must indicate in the Application Form, the number of Equity Shares they wish to receive in the electronic form and in the physical form. Further it may be noted that in such cases the allotment of Equity Shares would be first be done in electronic form and the remaining in physical form. However, if the same Applicant submits two Application Forms, one for Equity Shares in electronic form, such Application will as multiple applications and are liable to be rejected. In case of Application Forms submitted in joint names, it may be ensured that the Depository Account is also held in the same joint names and are in the same sequence in which they appear in the Application Form. Further, Syndicate Members reserve a right to ask for suitable documentary proof of Depository Account from the Bidder to ensure that correct Depository Account details are given by the Bidder, (for details refer para on option to hold shares in electronic form with CDSL/NSDL).

iv) Bids under Power of Attorney

In case of bids made under Power of Attorney or by limited companies, corporate bodies, registered societies, etc., a certified copy of the Power of Attorney or the relevant resolution or authority, as the case may be along with a certified copy of the Memorandum & Article of Association and/or Bye Laws must be lodged along with the Bid cum Application Form with the Syndicate Member. Failing this, the Issuer reserves the right to accept or reject any bid in whole or in part, in either case, without assigning any reason thereof .

v) Submission of Bid Form

All Bids cum Application Forms or Revision Forms duly completed and accompanied by Account cheques or drafts or Stock-invest shall be submitted to the BRLM/Syndicate Member at the time of submitting the Bid. The BRLM/Syndicate Member may at his discretion waive the requirement of payment of at the time of submission of the Bid cum Application Form and Revision Form in the case of Wholesale Bidders.

No separate receipts shall be issued for the money payable on submission of Bid cum Application Form or Revision Form. However, the collection centre of the BRLM/Syndicate Member will acknowledge the receipt of the Bid cum Application Forms or Revision Forms by stamping and returning to the Bidder the acknowledgement slip. This acknowledgement slip will serve as the duplicate of the Bid Form for the record of the Bidder.

II FIXED PRICE PORTION

a) Availability of Forms and Prospectus

Application forms together with Memorandum containing salient features of the offer document may be obtained from the Registered Office of the Company, Lead Manager to the Offer, Registrar to the Offer and Bankers to the Offer named herein or from their branches as stated on the reverse of the application form. Any person desiring to have a full copy of the offer document may write to the Lead Manager or to the Registered Office of the Company.

b) Who can apply -

1. Indian nationals resident in India who are majors, in single or joint names (not more than three)

2. Hindu Undivided Families in the individual name of the Karta.

3. NRIs on non repatriable basis

c) Procedure For Making Application

Application must be made only: -

1. On the prescribed application form accompanying the memorandum containing salient features of the offer document.

2. Completed in full in BLOCK LETTERS in English except signatures, in accordance with the instructions contained herein and in the application form. Applications not so made are liable to be rejected.

3. For a minimum of 200 equity shares and in multiples of 100 thereafter.

4. In single name or joint names (not more than three).

5. A magistrate or a Notary Public or a Special Executive Magistrate under his or her official seal must attest Thumb impression and signatures other than in the languages specified in the eighth schedule in the constitution of India.

6. The company reserves the right to reject any application without assigning any reason for such rejection and consequent refunds shall be made by cheque or pay order or draft and will be send to the applicant's address at the applicant's risk.

All communications should be addressed to the Registrar to the Issue.

Applicant's Bank Details.

The name of the Sole or first Applicant's Bank, branch, type of account and account numbers must be filled in the Application Form. This is required for the Applicant's own safety so that these details can be printed on the refund orders. Bids without these details are liable to be rejected.

Applicant's Depository Account Details.

All the Applicant's have an option to get their Equity Shares using the Depository mode. All Applicant's desirous of availing this facility should mention their Depository Participant's name, DP-ID and Beneficiary Account Number in the Application Form. In case a Bidder seeks allotment of certain number of shares ion dematerialised form and the remaining in physical form, these would be clubbed for the purpose of arriving at the basis of allotment. Applicants must indicate in the Application Form, the number of Equity Shares they wish to receive in the electronic form and in the physical form. Further it may be noted that in such cases the allotment of Equity Shares would be first be done in electronic form and the remaining in physical form. However, if the same Applicant submits two Application Forms, one for Equity Shares in electronic form, such Application will as multiple applications and are liable to be rejected. In case of Application Forms submitted in joint names, it may be ensured that the Depository Account is also held in the same joint names and are in the same sequence in which they appear in the Application Form. Further, Syndicate Members reserve a right to ask for suitable documentary proof of Depository Account from the Bidder to ensure that correct Depository Account details are given by the Bidder, (for details refer para on option to hold shares in electronic form with CDSL/NSDL).

Applications under Power of Attorney

In case of Applications made under Power of Attorney, a certified copy of the Power of Attorney or the relevant resolution or authority, as the case may be along with a certified copy of the Memorandum & Article of Association and/or Bye Laws must be lodged along with the Application with the registrar to the issue. Failing this, the Issuer reserves the right to accept or reject any bid in whole or in part, in either case, without assigning any reason thereof

d) Instruction For Payment

Payments should be made in cash or cheque or demand draft or stock-invest drawn on any bank (including a Co-operative Bank), which is situated at, and is a member or a sub-member of the Bankers' "Clearing House" located at the Centres (indicated in the Application Form) where the application is accepted. A separate cheque / demand draft / stock-invest should accompany each application.

Applicants residing at places where no collection centres have been opened may submit to may be crossed A/c "Wonder Craft Industries Limited- Public Issue" You are requested to mention the Application Form Number on the reverse of the Cheque / Draft / Stock-invest.The applications should be submitted at the designated collection centres of the bankers to the issue before the issue closing date.

When application for equity shares is for the total value of Rs.50000/- or more, i.e. the actual number of securities applied for multiplied by the Issue Price, is Rs.50000/- or more the applicant or in the case of an application in the joint names, each of the applicants must mention their Permanent Account Number (PAN) allotted under thr IT Act, 1961 or where the same not been allotted, the GIR number and the Income Tax Circles/Ward/District. In case neither the PAN nor the GIR number has been allotted the applicant must mention, "NOT ALLOTTED" in the appropriate place. Application form without this information will be considered incomplete and are liable to be rejected.

Money orders, postal orders, outstation cheques or demand drafts, cheques / draft drawn on banks not participating in the "clearing house" will not be accepted and applications accompanied with such instruments may be rejected.

No separate receipts will be issued for the application money. However, the Bankers to the Offer receiving the application form will acknowledge receipt of the application by stamping and returning to the applicant the Acknowledgment Slip at the bottom of each application form.

In case payment is effected in contravention of the conditions mentioned herein, the application money will be refunded and no interest will be paid thereon.

Application (s) will not be accepted by the lead manager to the offer or registrar to the offer.

e) Disposal Of Application And Application Money

No receipt will be issued for application money. However, the Bankers to the Offer receiving the application will acknowledge the receipt of the application by stamping and returning the detachable acknowledgment slip appended to each application.

The sum received in respect of the offer will be kept in separate bank accounts and the Company will not have any access to the funds unless approval of the Regional Stock Exchange i.e. the Stock Exchange, Mumbai is obtained for the basis of allotment and listing approval from the Stock Exchange where listing is proposed.

The Company reserves the full unqualified and absolute right to accept or reject any application in whole or part and in either case without assigning any reason thereof.

f) Payment by Stock invest

The Applicant who is an individual has the option to use stock-invest in lieu of cheques or bank drafts for payment of application money, subject to applicable laws guidelines. The Applicant using stock-invest should submit the Application Form along with the instrument to the Bankers to the issue/collection centre mentioned in the Application Form. Stock-invest instruments are payable at par at all the branches of the issuing bank and as such, outstation stock-invest instruments can be attached to the Application Form. Stock-invest can be obtained from any Bank issuing such instrument in various denominations by making the necessary applications and depositing the amounts with the respective banks. The stock-invest will be issued to the applicant, in blank format after authentication of the date of offer by the designated branch. The stock-invest duly completed should be submitted along with the Application Form to the Bankers to the issue.

The Applicant may approach the banks concerned for obtaining stock-invest and detailed instructions for same. The stock-invest should be made payable in favour of "Wonder Craft Industries Limited- Public Issue"

The Applicant has to fill in the following particulars:

Title of the account i.e. "Wonder Craft Industries Limited- Public Issue"

The number of equity shares applied for;

The amount payable as per the Share(s) applied for in the Application Form;

The name and address where the stock-invest should be returned in case of non-allotment; and

The Application Form number on the reverse of the instrument.

The Applicant should thereafter sign the instrument. The stock-invest should bear "Account Payee" and "Non-Negotiable" crossing and will be payable only to the account of the Issuer Company. i.e. "Wonder Craft Industries Limited- Public Issue". Stock-invest should be utilised by the purchaser(s) and the purchaser's name / name of one of the purchasers should be invariably indicated as the first applicant in the composite application form. Thus if the signature of the purchaser on the stock-invest and the signature of the first applicant on the application form does not tally, the application would be treated as having been accompanied by a third party stock-invest and is liable for rejection.

No refund will be made to those Applicants using stock-invest for payment of money due under the Application Form. In case of non-allotment of equity shares, the cancelled stock-invest instrument will be returned to the Bidder, who will have to approach the issuing bank branch for lifting of lien.

Applications with stock-invest not fulfilling the above criteria are liable to be rejected. The service charges, if any, for procuring the stock-invest shall be borne by the Bidder.

In case of full allotment, the number of equity shares and the amount on the right hand side will be the same as the left-hand side of the instrument.

In case the allotment is nil, the number and the amount filled up by the Registrar on the right hand side of the instrument will be nil.

The Registrar to the Offer has been authorised by the Company vide a Board Resolution passed on ------/2000 to sign on behalf of the Company for realising the proceeds of the stock-invest of the successful allottees from the issuing bank or to affix non-allotment advice on the instrument or to cancel the stock-invest of the non-allottees or partly successful allottees who can enclosed more than one stockinvest. The cancelled instrument shall be sent back by the Registrar to the Investor directly.

g) Disposal Of Application Made By Stock-invest

The procedure for disposal of applications made by cash/cheque/demand draft will apply mutatis mutandis to stock-invest except the following:

In case of non-allotment, stock-invest will be cancelled by the Registrar to the Offer and returned to the Applicant. The Stock-invest will bear stamps such as "CANCELLED" and "NOT ALOTTED" across the face of the instrument. The issuing bank will lift the lien on the account on surrender of the same by the Applicant. In case the cancelled stock-invest is not received by the investor from the Registrar to the Offer, lien will be lifted by the issuing branch on expiry of four months from the date of offer against an indemnity bond from the applicant.

In case of allotment / partial allotment, the Registrar to the Offer shall fill in the amount in the stock-invest which would be less than or equal to the amount filled by the Applicant and present the stock-invest duly discharged on behalf of the Company for collection of payment to the extent of allotment to the respective issuing Bank. The issuing bank will lift the lien on the balance amount, if any, of trial Instructions stated below are applicable to both, the Fixed Price Portion and Book Built Portion.

The company reserves full, unqualified and absolute right, to accept or to reject any application or Bid, in whole or in part, and in either case without assigning any reason thereof.

i) Section 269SS of the Income Tax Act, 1961

Having regard to provisions of Section 269SS of the Income Tax Act, 1961, the subscription against the equity shares application for an amount of Rs. 20,000 or more should not be effected in cash and must be offered only by an A/c payee cheque / bank draft / stock-invest. In case payment is effected in contravention of the provisions, the application is liable to be rejected and application money will be refunded without interest.

ii) Joint Applications:

An application or Bid may be made in single or joint names (not more than three) as mentioned elsewhere in the offer document. In case of a joint application, refund pay order (if any) and dividend / warrants, etc. will be made out in favour of the first applicant. All communications will be addressed to the applicant whose name appears first and will be dispatched to the first applicant's address stated in the Application Form or Bid Form.

iii) Multiple Applications:

An Applicant or a Bidder should submit only one Application Form or Bid Form (and not more than one) for the total number of equity shares required or Bid for. Applications or Bids may be made in single or joint names (not more than three). Two or more Application Forms or Bid Forms, in single and / or in joint names will be deemed to be multiple application or Bid if the sole and / or first applicant is one and the same. However separate Bids can be made in respect of each scheme on a separate bid form of Indian Mutual Fund registered with SEBI and that such applications will not be treated as multiple application provided that the applications made by AMC/ Trust/Custodians clearly indicated their intention as to each scheme concerned for which application has been made. The company reserves the right to reject in its absolute discretion all or any multiple application(s).

Separate Applications or Bids for electronic and physical shares by the same first and / or sole applicant will be treated as multiple applications and are liable to be rejected.

The fixed price portion is reserved for individual investors who have not received allocations in the Bidding process. Those who have participated in the bidding process and have received allocation shall not be eligible to make an application in the Fixed Price Portion. Such applications will be treated as multiple applications and are liable to be rejected.

iv) Application under Power of Attorney :

In case of Applications/ Bids under a Power of Attorney or by limited companies or bodies corporate or societies, the relevant Power of Attorney or the relevant resolution or authority to make the application, as the case may be, together with a certified true copy thereof along with a copy of Memorandum and Articles of Association and /or bye-laws must be attached to the application form at the time of making the application or lodged for scrutiny separately indicating the Serial No. of the application form with the Registrar to the Offer within 10 days from the closure of the offer/ Bid, failing which, the issuer reserve the full, unqualified and absolute right to accept or reject any application/ Bid in whole or in part and in either case without assigning any reason thereof.

The applicant/ Bidder should mention the Application form/ Bid Form number on the reverse of the instrument through which payment is made.

v) Applicants/ Bidders are advised that it is mandatory for them to indicate in the space provided in the application form, details regarding their Saving Bank / Current Account Numbers and the name of the branch of the bank to which they want the proceeds of refund to be credited. Applications not containing such details are liable to be rejected.

vi) Depository option to investors

AS PER SEBI GUIDELINES DATED 16TH FEBRUERY,2000, IT HAS BEEN DECIDED THAT , TRADING IN SECURITIES OF COMPANIES MAKING AN INITIAL OFFER SHALL BE IN DEMATERLISED FORM ONLY.

As per the provisions of the Depositories Act, 1996, the shares of a body corporate can be in a dematerialised form, i.e. not in the form of physical certificates but be fungible and be represented by the statement issued through electronic mode. Many companies and investors are now opting for dematerialisation of their securities. The company will also opt for this method subject to investors exercising their option to hold the shares in dematerialised form, for which necessary columns have been provided in the respective applications forms. The Company has already applied to NSDL/CDSL for allotment of ISDN No.

In this context:

A tripartite agreement will be signed between the Company, the registrar to the issue and the depositories, i.e., NSDL/CDSL.

Institutional Bidder has to compulsory seek allocation of equity shares in electronic form. The Institutional Bidder, however, reserves the right to dematerialise their shares after allotment. The Individual Bidder/ Applicant has an option to seek allotment of equity shares in electronic and/or physical mode. Such an option if exercised, should be indicated in the Depository Instruction Section in the application form itself.

Separate application or Bids for electronic and physical equity shares by the same applicant shall be considered as multiple application, hence, will result in rejection of application for shares in electronic mode and only the application for physical mode will be considered as a valid application.

Applicants or Bidders who wish to apply for equity shares in electronic form need to have at least one Beneficiary Account with a Depository Participant prior to making the application.

Applicants or Bidder's name in the Depository Instruction Section in the application form should be the same as appearing in his or its Beneficiary Account. In case of joint applicants, in addition to the name, the sequence of the names in the DIF and Beneficiary Account should be the same.

If incomplete/incorrect investor account details are given in the application or the Bid form, it may result in issuance of physical Equity Share Certificate.

Allotment Letters/Refund Orders will be directly send to the investors by the Registrar.

Responsibility for correctness of the demographic details given to the Depository Participants, for opening of Beneficiary Account would rest with the applicant.

Shares in electronic form can be traded only on Stock Exchanges having electronic connectivity with NSDL/CDSL.

In case of partial allotment, allotment will be done in demat option for the shares sought in demat and balance, if any, will be allotted in physical shares.

Investors who have indicated their preference for holding their shares in a dematerialised (demat) form, will have to follow the steps mentioned below:

The applicant will fill-up the Depository Instructions Section in the application form which will authorise the Company to allot shares to him in the electronic form.

The applicant may apply for part of shares in dematerialised (demat) form and balance in the physical form. This should be indicated under the heading' "Request for shares in Electronic Form" in the application form.

PRICE DISCOVERY, ALLOCATION AND ALLOTMENT

A. Book Built Portion

i) Price Discovery

After the Bidding Closing date, the BRLM shall analyse the demand for the equity shares based on the Bids received by the syndicate members at various price levels, and discuss the pricing strategy with the Company. The Company in consultation with BRLM will finalise the 'Issue Price', and the allocation to successful Bidders in both the categories. The BRLM shall then intimate the Syndicate Member(s) of the Issue Price and allocation for the respective bids received through them. In any event, Issue Price shall not be less than the floor price.

ii) Allocation in the Book Built Portion

Discretionary Institutional Bidders

Allocation in the Institutional Book Built Portion will be made to Institutional Bidders who have bid at or above the Issue Price. Such allocation in the Institutional Book Built Portion will be made at the discretion of the Company in consultation with the BRLM.

Individual Bidders

Bids received from the individual Bidders (including HUF and NRIs) who have bid for upto 10 tradable lots, i.e. a maximum of 1000 Equity Shares at or above the Issue Price shall be grouped together to determine the total demand under this category. In case of under subscription full and firm allocation will be made to the bidders in this portion. In case of over subscription allocation in the individual book Built Portion will be made on a proportionate Basis as described in the Part II of the draft offer document. Allocation in this category shall be finalised in consultation with the regional stock exchange.

iii) Allotment in Fixed Price Portion

Individuals, HUFs (who apply in the name of Karta) and NRIs on non repatriable basis are entitled to participate in and subscribe to the equity shares of the company and may participate in the fixed Price Portion (also refer section on "Issue Structure" ). In case of over subscription in the Fixed Price Portion, allotment will be made on a proportionate basis as described in Part-II of the Draft Offer Document. In case of under subscription in the Fixed price Portion the company has the option to allocate such under subscribe equity shares to which ever category of investors it deems fit or allow such under subscribed portion to lapse.

iv) Announcement of Advertisement

After the Company determines the Issue Price in consultation with the Allocation Committee, a statutory advertisement will be issued by the company either prior to or after filing of the Final Offer Document with ROC. This advertisement shall in addition to the information that has to be set out in the statutory advertisement shall indicate the price of the Equity Shares along with a table showing the number of Equity Shares and the amount payable by an investor.

v) Signing Of Underwriting Agreement & Roc Filing

The BRLM/Syndicate Member(s) and the Company shall enter into an underwriting agreement on being intimated about the Issue Price and allocation(s) to their Bidders prior to ROC filling.

The Draft Offer Documents shall be finalised and filed with the ROC soon after signing of the Underwriting agreements.

vi) Issuance of Confirmation of Allocation Note in the Book Built Portion.

The BRLM/Registrar shall send to the Syndicate Members a list of their Bidders who have been allocated shares in the Book Built Portion.

The receipt of the list of allocation for their Bidders by the Syndicate Members shall constitute acceptance of the Bids set out in the Said lists for the Issue and the same shall be deemed to be a valid and binding contract. The Bidders shall be deemed to have knowledge of such acceptance immediately upon the receipt by the Syndicate Members of the list of allocation for their Bidders. The Syndicate member is, for this limited purpose deemed to be the agent of the Bidders.

The BRLM/Syndicate Members would then send the CAN to their Bidders who have been allocated shares in the Book Built Portion and who have not paid into the Escrow Account of the company at the time of Bidding, shall directly pay the amount payable in the Escrow Account.

Bidders who have been allocated Equity Shares and who have already paid into the Escrow Account at the time of bidding shall directly receive the CAN from registrar to the Issue subject, however, to realisation of their cheques or demand drafts. No further action is required from such Bidders. In case the issue price is higher than the Bid amount paid, the Bidders who have paid lesser than the face value of their allocated equity shares at the issue price will be required to pay such shortfall as per the instructions given in the CAN.

Equity shares shall, after the receipt of the entire Issue proceeds, be allotted to the investors within 15 days of the Issue Closing Date for the Book Built Portion.

DISPATCH OF SHARE CERTIFICATES / ALLOTMENT LETTERS / REFUND ORDERS

The Company shall dispatch, Letter(s) of Allotment/Share Certificate(s) and/or Letters of Regret together with Refund Orders/Pay Orders, if any, within 10 weeks from the closure of the Issue to the Sole / first named applicant at his/her sole risk. In case of delay in refund of such amount beyond the stipulated period, the Company will pay interest to the applicants at the prescribed rates as per the provisions of Section 73 of the Act'.

The Company shall ensure dispatch of Refund Orders of value up-to Rs.1,500/- under Certificate of Posting and those over Rs.1,500/- and Share Certificates by registered post only and that adequate funds for the purpose will be made available to the Registrars to the Issue.

In accordance with the Act, the Stock Exchange requirements and SEBI Guidelines the Company further undertake that:

Allotment of securities relating to the Fixed Portion offered to the public shall be made within 15 days of the Issue Closing Date for Fixed Price Portion and

Allotment of securities relating to the Book Built Portion shall be made within 15 days of the Issue Closing Date for Book Built Portion and refunds for the Book Built portion shall be made within 15 days of Bid Closing Date, except for those bidders who have opted for the conversion option.

it shall pay interest @ 15% p.a. (for delay beyond 15 days as mentioned above) except for the applicants applying through stock-invest, if allotment has not been made and/or the refund orders have not been dispatched to the investors within 15 days from the date of closure of the offer.

The company will provide adequate funds to the Registrars to the Issue, for this purpose

UNDERTAKING BY THE COMPANY

The company undertakes the following: -

1. The complaints received in respect of the issue shall be attended to by the issuer company expeditiously and satisfactorily.

2. The company undertakes that all the steps for completion of necessary formalities and commencement of trading at all stock exchanges where the securities are to be listed will be taken within 7 working days of finalisation of basis of allotment .

3. The funds required for the dispatch of refund orders/ allotment letters / certificates by registered post shall be made available to the Registrar to the issue by the company.

4. The promoter's contribution in full, wherever required, shall be brought in advance before the issue opens for public subscription and the balance, if any, shall be brought in pro rata basis before the calls are made on public.

5. The certificates of the shares / refund orders to the non-residents Indians shall be dispatched within specified time.

6. No further issue of securities shall be made till the shares offered through this offer document are listed or till the application moneys are refunded on account of non - listing, undersubscription, etc.

FURTHER the Company accept full responsibility for the accuracy of the information given in this offer document and confirm that to the best of their knowledge and belief, there are no other facts the omission of which make any statement in this offer document misleading, and they further confirm that they have made all reasonable inquiries to ascertain such facts.

UTILISATION OF ISSUE PROCEEDS

The sum received in respect of the offer will be kept in a separate bank account and the Company will not have access to such funds unless allotment of equity shares has been made in consultation with the Regional Stock Exchange and listing approval has been received from the Stock Exchanges where listing has been sought.

The Board of Directors of the Company certifies that -

1. All monies received out of this issue to the Public shall be transferred to a separate bank account other than the bank account referred to in sub-section (3) of Section 73 of the Act.

2. Details of all monies utilised out of this issue referred to in sub-item (a) shall be disclosed under an appropriate separate head in the Annual Report of the Company indicating the purpose for which such monies have been utilised; and

1. Details of all unutilised monies out of the issue, if any, referred to ____.

2. The details of all unutilised monies out of the fund received under promoters contribution and from firm allotments and reservations shall be disclosed under a separate head in the balance sheet of the company indicating the form in which such unutilised monies have been invested.

TAX BENEFITS

M/s. S. F. Tai & Associates, Chartered Accountants, have advised WCIL vide their Letter dated 20th November, 2000, that as per the current provisions of the Income Tax Act, 1961 and the existing laws for the time being in force, the following benefits, interalia, will be available to WCIL and the Members as given below :-

A. TO THE COMPANY :

I) EXPENDITURE INCURRED, IF ANY, OF THE NATURE SPECIFIED IN SECTION 35-D OF THE INCOME TAX ACT CAN BE AMORTISED OVER A PERIOD OF TEN YEARS, SUBJECT TO LIMITS SPECIFIED THEREIN.

II) UNDER SECTION 80-HHC OF THE INCOME TAX ACT, THE COMPANY WILL BE ENTITLED TO A DEDUCTION IN RESPECT OF PROFITS DERIVED FROM EXPORT OF GOODS COMPUTED IN THE MANNER SPECIFIED IN THE SECTION.

III) UNDER PROVISIONS OF SECTION 80-JJAA OF THE INCOME TAX ACT, 1961 THE COMPANY WOULD BE ENTITLED TO DEDUCTION OF AN AMOUNT EQUAL TO 30% OF ADDITIONAL WAGES PAID TO THE NEW REGULAR WORKMEN EMPLOYED BY THE COMPANY FOR THREE ASSESSMENT YEARS INCLUDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SUCH EMPLOYMENT IS PROVIDED.

IV) UNDER SECTION 115-JAA OF THE INCOME TAX ACT, 1961, THE COMPANY WILL BE ENTITLED TO CARRY FORWARD A TAX CREDIT IN RESPECT OF TAX PAID ON DEEMED INCOME UNDER SECTION 115-JA UPTO A PERIOD OF THE FIFTH ASSESSMENT YEAR IMMEDIATELY SUCCEEDING THE ASSESSMENT YEAR IN WHICH SUCH TAX CREDIT BECOMES ALLOWABLE.

V) UNDER SECTION 10(33) OF THE INCOME TAX ACT, 1961, INCOME BY WAY OF DIVIDENDS RECEIVED FROM OTHER DOMESTIC COMPANIES, WILL NOT BE CHARGEABLE TO TAX IN THE HANDS OF THE COMPANY.

VI) UNDER THE PROVISIONS OF SECTION 122 OF INCOME TAX ACT, LONG TERM CAPITAL GAIN WOULD BE CHARGED TO TAX AS PER OPTION ONE AT THE RATE OF 20% OR SALE CONSIDERATION DEDUCTED BY INDEXED COST OF ACQUISITION OR AS PER OPTION TWO AT THE RATE OF 10% ON SALE CONSIDERATION DEDUCTED BY COST OF ACQUISITION WHICHEVER TAX IS LOWER.

B. TO THE SHAREHOLDERS OF THE COMPANY :

I) INCOME TAX :

(I) DIVIDENDS RECEIVED FROM THE COMPANY WILL BE EXEMPTED FROM INCOME TAX IN THE HANDS OF THE SHAREHOLDERS AS PER THE PROVISIONS OF SECTION 10(33) OF THE INCOME TAX ACT, 1961.

(II) UNDER SECTION 112 OF THE INCOME TAX ACT, 1961 CAPITAL GAIN OR TRANSFER OF A LONG TERM CAPITAL ASSET, BEING LISTED SECURITIES, EXCEEDS 10% OF THE AMOUNT OF CAPITAL GAINS BEFORE GIVING EFFECT TO SECOND PROVISION OF SECTION 48, THE, SUCH EXCESS SHALL BE IGNORED FOR THE PURPOSE OF COMPUTING THE TAX PAYABLE BY THE ASSESSEE.

(III) IN ACCORDANCE WITH AND SUBJECT TO THE CONDITIONS AND TO THE EXTENT SPECIFIFED IN SECTION 54-EC OF THE INCOME TAX ACT, 1961 THE SHAREHOLDERS WOULD BE ENTITLED TO EXEMPTION FROM LONG TERM CAPITAL GAINS ON SALE OF THEIR SHARES IN THE COMPANY.

(IV) IN CASE OF A SHAREHOLDER, BEING AN INDIVIDUAL OR A HINDU UNDIVIDED FAMILY, IN ACCORDANCE WITH AND SUBJECT TO THE CONDITIONS AND TO THE EXTENT SPECIFIED IN SECTION 54-F OF THE INCOME TAX ACT, 1961 THE SHAREHOLDERS WOULD BE ENTITLED TO LONG TERM CAPITAL GAINS ON THE SALE OF THEIR SHARES IN THE COMPANY.

(V) NO INCOME TAX WILL BE DEDUCTED AT SOURCE UNDER THE PROVISIONS OF SECTION 94 OF THE INCOME TAX ACT, 1961 BY THE COMPANY FROM THE DIVIDENDS DISTRIBUTED BY IT TO IT SHAREHOLDERS.

II. WEALTH TAX :

(VI) TOTAL EXEMPTION FROM WEALTH TAX WOULD BE AVAILABLE ON INVESTMENT IN SHARES OF THE COMPANY.

III. Gift Tax :

(vii) Effective from october 1, 1998, no gift tax shall be levied on gift of shares of the company.

PARTICULARS OF ISSUE.

OBJECTS OF THE ISSUE

1) To set up factory at Karjan (Dist. Baroda) as UNIT 2 for the purpose of:

a. For increase in Installed Production Capacity by 7200 MT p.a. of Corrugated Boxes, Sheets and Rolls

b. To start manufacturing new product known as Paper Shopping Bags with an installed capacity of 30 lacs pieces p. a.

2) To augment long term working capital resources of the Company.

3) To get the shares listed on Mumbai, Ahemdabad and Vadodara Stock Exchanges.

COST OF THE PROJECT & MEANS OF FINANCE

The Total Cost of the Project is Rs 736.00 Lacs as detailed hereunder. The said Cost of Project / Means of Finance have not been appraised by any Bank and the same have been estimated by the Company.

COST OF PROJECT

(Rs. in Lacs)

PARTICULARS

TOTAL

Land

11.00

Site Development.

16.04

Building.

118.33

Equipments, Plant & Machineries

332.42

Electrical Installations.

13.61

Miscellaneous Fixed Assets.

20.22

Preoperative Expenses

16.71

Capital Issue Expenses

36.00

Contingences.

25.03

Margin For Working Capital

146.64

TOTAL

736.00

MEANS OF FINANCE

The Company proposes to finance the funding requirements from the proceeds of the Issue details of which is as under :-

(Rs. in Lacs)

PARTICULARS

Amount (Rs. in lacs)

Share Capital :

- From Promoters, Friends, Relatives & Associates

336.00

- From Indian Public

400.00

TOTAL

736.00

DEPLOYMENT OF FUNDS IN THE PROJECT

Auditors' of the Company, M/S.S.F.TAI & ASSOCIATES, Chartered Accountants, has certified the statement of deployment of funds of Rs. 87.47 as on 25.11.2000 vide their letter dated November 25, 2000. The Details are as under:

Sources of Funds

Amount(Rs. In lacs)

Promoters and their associates

87.47

Total

87.47

Application of Funds

Land and Site Development

13.25

Building under Construction

55.09

Advance for Plant & Machinery

18.03

Pre-operative Expenses

1.10

Total

87.47

YEAR WISE BREAK-UP OF THE EXPENDITURE TO BE INCURRED ON THE SAID PROJECT

As the amount procured from the issue will be utilised in the year 2001, year wise break up is not required.

V. COMPANY, MANAGEMENT & PROJECT

BRIEF HISTORY AND PRESENT BUSINESS OF THE COMPANY

The company is being promoted by Mr. Pravinbhai Patel and Mr. Sanjay T Patel.

Wonder Craft Industries Ltd. was incorporated as a Private Limited Company on 15th July, 1996 under the name and style of Wonder Craft Packaging Pvt. Ltd. with the objective of manufacturing and marketing of Corrugated Boxes, Sheets and Rolls used for Packing all types of Products like Food Products, Textiles, Pharmaceuticals, Electrical, Electronics, Consumer Durables, Engineering, Soaps & Detergents, Plastics etc.. The company was subsequently converted into a Public Limited Company and received Fresh Certificate for Incorporation on 9th May 2000 from The Registrar of companies, Gujarat, Dadra and Nagar Haveli. The company was renamed as Wonder Craft Industries Limited on 12th July, 2000.

MAIN OBJECTS OF THE COMPANY

The main object clause of the Company as set out in its Memorandum and Articles of Association was originally as follows :-

1. To carry on the business of manufacturers, processors, designers, buyers, sellers, exporters, importers and/or otherwise dealers in cardboard packing, polyethylene packing, gunny bags and whether made of plastic of any man made fibre, leather or of other material including high and low density polyethylene, polypropylene, plastic PVC chemicals and other man made fibrous material used in manufacture of cardboard packing, corrugated packing, plastic packing, polyethylene packing, gunny bags, containers, bottles and hollow wares and to manufacture, process, buy, sell, import, export or otherwise deal in all or any such products.

2. To carry on business as manufacturers of/and dealers in, or as stockists, importers and exporters of packing cartons, boxes and cases made of paper, boards, wood, glass, plastic, pulp, cellulose, films, polyethylene, rubber, flexible, treated, laminated or other materials.

The company in the last quarter of 2000 acquired Shreeji Copper Private Limited engaged into manufacturing of Copper and Brass Tubes. So as to include the said activities in the main object clause the clause was altered on June 9, 2000 by passing a special resolution in the EGM held on the same date to include the following:

3. To carry on in India or elsewhere the business as manufacturers, producers, processors, importers, exporters, buyers, sellers, stockists, agents, contractors, exchangers, providers, distributors, jobworkers, collaborators, consultants, transporters, suppliers and dealers in all kinds, classes, applications, specifications, descriptions, characteristics, colours and uses of papers, boards and pulp.

4. To carry on business as manufacturers, formulators, processors, producers, makers, buyers, sellers, re-sellers, importers, exporters, distributors, suppliers, fermentators, distillers, refiners, stockists, agents, merchants, developers, consultants and dealers, in all types, forms (solid, liquid and gaseous) and of all kinds of chemicals and chemicals compounds (organic and inorganic) heavy chemicals, acids, alkalies, tannis, tannin extracts, solvents, dyestuffs, dyes, pigments, colours, resins, chemicals auxiliaries, microcrystalline, bio and colloidal chemicals, including coating materials natural and synthetic depolymeries products, sparay dried product synthesiced coating spreads, carbon and intermediates, derivatives suspensions, gels, poweders, formulations, downstreams, ingredients and by-products and their related preparations articles and products.

5. To promote, run, establish, install or set up mini steel plants, integrated steel plants, composits steel plants, hot rolling steel mills, cold rolling mills, blooms and billet mill, steel furnace, concocts, rolling mills, induction furnace for the manufacturing, converting, extracting, treating or processing of all types, grades and sizes of steels, stainless steels, special steels, high speed steels, die-steels, electrical steels, forging steels, alloy steels, including direct hardening steels, case hardening steels, nitriding steels, ball bearing steels, corrosion resisting steel, heat resisting steel, fee cutting steels, spring steels, silicon manganese steels, structural steels, hip building quality steels, armour steels, magnet steel, hot rolled and cold rolled grain oriented electrical steels or any types of steels present or future compounds and alloys thereof and to act as agent, stockists, trader, buyer, seller, importer, exporter and jobworker.

6. To carry on the business of consultancy and development of computer software and business of medical transcription and other information technology enabled services and to provide turn key solution for the same and also to provide software solutions and to carry on in India of overseas, offshore of on site, the business of system study, analysis, design, coding, testing, documentation, development and implementation of software relating to commercial and non-commercial usages through the use of various magnetic media, digital media and internet, provide recrutment and placement services in India and abroad for computer in field like software, hardware, communication, media, computer etc. and information technologies consultancy, web site designing, hosting and maintenance, development of e-commerce technologies, web related systems development, internet and internet development and to carry on in India of overseas the business of trading, importing and exporting and to act as consultants in software, hardware related to commercial and non-commercial usages, training in information technology in software and hardware and to work as teching educational institute and appoint franchise in India and overseas and to provide bureau for providing computer service to process data and develop system of all kind by processing jobs and hiring out machine time and assist to set up, operate and surpvise the operation of data processing division of companies in India or overseas and to provide all or any of the following services namely: Internet service providers, basic telephone service, cellular telephone service, electronic mail services, net connectivity E-mail service, internet access services related services thereof, such as store and forward services, (indexed file transfer, worldwide web (WWW), on line services such as internet technology, cyber café or cyber bureau service, video-telephone or video-conference and electronic communication services, cellular mobile telephone services, radio paging services, public mobile radio trunked services, voice mail/audio tex services, closed users group domestic, 128 kbps data network VSAT services via INSAT satellite systems, videotex services, data communication services, paging services, multimedia services and value added services and value added infotech and cyber services.

PRESENT BUSINESS OF THE COMPANY

The Company is presently engaged in Manufacturing of Corrugated Boxes, Sheets and Rolls at its existing Unit now designated as Unit-1.

The company registered office is owned by one of the relative of one of the promoter of the company. The company does not pay any rent for the said premises and also there is no formal agreement for using the office.

The company has further taken on leave and license basis office premises admeasuring 250 sq ft in Borivli, Mumbai on a monthly rent of Rs. 3,000 from Ms Shantaben H Purohit for a period of 11 months starting from June, 2000. The company has also paid a security deposit of Rs.75,000. The said office has been designated as Head Office of the company in view of the business potential offered by the city.

The Company has Unit-1 (Factory) at Block No. 18 & 20, Navi Jithradi, Karjan, Dharat Road, Tal-Karjan, Dist - Baroda a Category II backward area entitled to hosts of Incentives as per the Scheme of Government of Gujarat. The Unit is located on Plot adm. 2890 Sq.mtrs. with Factory Building adm. 7858 Sq.Ft. and has an Installed Capacity of 1200 Mt p.a.

Now the company has decided to expand its operations substantially by setting up Unit-2 with state-of-the-art Plant and Machineries with an Installed Capacity of 7200 MT p.a. of Corrugated Boxes, Sheets and Rolls and new product line of Paper Shopping Bags with a capacity of 30 Lacs pcs p.a. The expansion will not only help the company achieve substantial economies of scale but widen the product range to attract large volume customers in Consumer Durables, Plastics, Pharmaceuticals Industries etc..

SUBSIDIARIES OF THE COMPANY

During the last quarter of fiscal 1999-2000 the company took over the entire operations of Shreeji Copper Private Limited for engaged into manufacturing of Copper and Brass Tubes having an Installed Capacity of 600 M.T. p.a. with facilities located in Tal-Wada, Dist - Thane Maharashtra a state notified D+ backward zone entitled to host of Sales Tax & Income Tax Incentives. The Company acquired 100% of the shareholding of the Promoters of Shreeji Copper Private Limited. The company has acquired 7,16,700 Equity Shares at Rs. 10/- per share aggregating to Rs. 71.67 lacs.

The details of Shreeji Copper Private Limited are as follows:

Date of Incorporation : November 2, 1995

Nature of Activities : Manufacturing of Copper and Brass Tubes having an Installed Capacity of 600 M.T. p.a. with facilities located in Tal-Wada, Dist - Thane

(Rs. in lacs)

Particulars

1997-98

1998-99

1999-00

Equity Capital

10.44

71.67

Share Application Money

57.08

72.26

Reserves (excluding revaluation reserves)

0.05

0.29

0.57

Sales

3.47

48.82

56.95

Profit after tax (PAT)

0.14

0.39

0.28

Earning per share

0.13

0.37

0.04

Net Asset Value (NAV) Rs.

64.28

78.26

9.92

LIST OF MAJOR CLIENTS

1. Sugam Dairy,Baroda.

2. The Antifricticon Bearings Corp. Limited. (ISO 9002)

3. Alembic Glass Works Limited.

4. Alembic Chemical Works Limited. (ISO 9002)

5. Viacom Electronics P. Limited. (AIWA & TCL TV) (ISO 9002)

6. Art Groups of Industries.

7. Mudrica Ceramics (I) Limited.

8. Miranda Tools Limited. (ISO 9002)

9. Miranda Amsow Limited. (ISO 9002)

10. JCT Electronics Ltd.

PROMOTERS AND THEIR BACKGROUND

WCIL is promoted by Shri. Sanjay T Patel and Shri. Pravinbhai P Patel.

Shri. Sanjay T. Patel, aged 31 years, is a Commerce Graduate and has done specialised certificate course in Corrugated Packaging conducted under the aegis of Indian Institute of Packaging. He has more than ten years of experience in all aspects of manufacturing and marketing of Corrugated Boxes, Sheets and Rolls,

Shri Pravinbhai P. Patel, aged 38 years, has more than ten years of experience in handling of Finance, Administration functions of a medium sized Diamond Concern as its Manager and is guiding Shri. Sanjay T. Patel in handling the affairs of WCIL. The Promoters are ably assisted by a team of experienced personnel in day to day management of the Corrugated Packaging Unit at Tal. Karjan, Baroda.

MANAGEMENT AND MANAGERIAL COMPETENCE

The day to day management of WCIL is headed by Shri. Sanjay T. Patel who looks after the manufacturing and marketing operations of the Unit. The Finance and Administrative functions are looked after by Shri. Pravinbhai Patel. Both the Promoters are ably assisted by a team of experienced personnel and have relevant competence in all aspects of Corrugated Packaging Business.

BOARD OF DIRECTORS

The present Directors of the Company are as follows :-

Name, address and Occupation of the Directors

Designation

Age

Qualification

Other Directorships

Mr. Pravinbhai P. Patel

A-803, Sminu Apartment, Mandpeshwar Road, Borivali (W), Mumbai - 400092.

Occupation : Business

Director

38Yrs

SSC

Nil

Mr. Sanjay T. Patel

B/3, Nikunj Apartment, Opp. Krishna Talkies,

Siddhath Road, Baroda.

Occupation : Business

Director

31 Yrs

B. Com.,

Nil

Mrs. Hiraben P. Patel

A-803, Sminu Apartment, Mandpeshwar Road, Borivali (West), Mumbai - 400092.

Occupation : Business

Director

36 Yrs

SSC

Nil

Mr. Bhikhubhai P. Patel

Bldg, 58, Ashoknagar Society, Katargam,

Singanpor Road, Surat - 395004.

Occupation : Business

Director

33 Yrs

HSC

Nil

Mr. Mansukhlal Patel

25, Belgielei 20/8, Antwerd, Belgium.

Occupation : Business

Director

42 Yrs

B.Com

Nil

Ms. Sheetal Sanjay Patel

B/3, Nikunj Apartment, Opp. Krishna Talkies,

Siddhath Road, Baroda.

Occupation : Business

Director

29 yrs

H.Sc.

Nil

Bio-data of other directors

Mrs. Hiraben P. Patel, aged 36 years, is SSC, and she has over 8 years of experience in general administration. She looks after general administration of the company.

Mr. Bhikhubhai P. Patel, aged 33 years, has experience in the field of diamond manufacturing and trading for over 13 years.

Mr. Mansukhlal Patel, aged 42 years, is B.Com., having experience in the field of diamond trading and manufacturing for more than 20 years.

KEY MANAGEMENT PERSONNEL

Details of the Key Management Personnel is as under :

Sr.

No.

Name and date of joining

Designation

Qualification

Previous Company & Work Experience

Experience

in years

Mr. Jatin Patel

01.12.98

Production Manager

SSC.

Hitkari Packaging

Experience of over 10 years in handling production operations of Corrugated Packaging Industry.

10 Yrs.

Mr. Chetan Patel

01.01.99

Marketing Manager

B.Com

Kamal Packaging

Experience of over two and half years in handling Marketing aspects of Corrugated Packaging Industry.

2.5 Yrs.

Mr. Ulpesh Pandya

01.04.2000

Manger Accounts

B.Com.

Unique Fabricators

He has experience of 4 years into accounts, taxation,

4 yrs

In addition to the above the Company is in the process of building up its team under the recruitment programme drawn by them in line with the expansion plan.

CHANGES IN THE KEY MANAGERIAL PERSONNEL DURING THE LAST 3 YEARS

There have been no changes in the key managerial personnel except the appointments as stated above in the prospectus

THE PROPOSED PROJECT

The Company has undertaken an expansion scheme envisaging setting up of state-of-the-art facilities, through a separate Unit (Unit-2) for manufacture of 7200 MTPA of Corrugated Boxes, Sheets and Rolls and 30 Lac pcs of Paper Shopping Bags at Navi Jithradi, P. O. Box No. 14, Karjan Dhavat Road, Karjan, Dist. Baroda - 391 240. On completion of the scheme, the total installed capacity of the Company would go upto _8400 MT p.a.

LOCATION

The Project is being located at Block Nos.18,19 &20 at Moje, Navi Jithradi, P. O. Box No. 14, Karjan Dhavat Road, Taluka -Karjan, Dist. Baroda - 391 240. The site is adjacent to the existing Unit of the Company and is well connected by road and rail, The unit are located about 4 Kms from Karjan Stations, and 40 Kms.from Baroda .

LAND

The Company has acquired 12,545 Sq. Mtrs. of Land of Freehold Non-agricultural Land from Shri. Pravinbhai Popatbhai Patel and Alpeshbhai B. Patel through three Sale Deeds for total consideration of Rs. 11,00,270/- (incl. the Cost of Registration and Stamp Duty). The Land has been transferred to the Company and the documents have been lodged for the registration to The Sub-Registrar, Karjan. The Land is yet to be registered in the name of the Company. The Land acquired from Shri. Pravinbhai P Patel and Alpeshbhai B. Patel is free from all encumbrances and has the clear and marketable title.

The land purchased includes plot no 18 & 20 from one of the promoter Mr. Pravinbhai Patel, details for which are as follows:

Mr. Pravinbhai patel, director and promoter of the company, resident of A-803, Sminu Apartment, Mandpeshwar Road, Borivali (W), Mumbai - 400092 has sold the plots no 18 & 20 as mentioned in the location above to the company at a value of Rs. 3.11 lacs. The plots have been purchased at the prevailing market price. The company has already paid whole of the amount by way of cheque drawn on State Bank of Saurashtra, Karjan.

SITE DEVELOPMENT :

The cost of Site Development including Levelling, construction of Internal Roads, Compounds, Walls, Gates is estimated at Rs. 16.04 Lacs. The Site Development is scheduled to be completed by April, 2001. The details as per quotation for site development received from Yogi Consultants, Engineers and Constructors vide their letter dated 5th September, 2000 are as under:

S.No.

Particulars

Qty

Rate

Amoun

(Rs. in lacs)

Compound wall

2600 sq ft

Rs.210/sq ft

5.46

Fencing

378 rft

Rs. 19/rft

0.07

Levelling

13850 sq ft

Rs. 40/sq ft

3.52

Construction of W.B.M. road

5.54

Landscaping

1.25

Gate of factory

0.20

Total

16.04

BUILDINGS

The Company has already commenced the construction of Factory Buildings on freehold land purchased for the purpose of Unit 2 in the month of October, 2000. The company has given the contract for construction to M/s Yogi Consultants, Engineers and Constructors for an aggregate value of Rs. 118.33 lakhs. Based on their quotation dated 5th September, 2000, the details of which are as follows:

S.No.

Particulars

Qty

Rate

Amoun

(Rs. in lacs)

Construction of Factory Building with AC sheet roof truss

26425 sq ft

Rs. 416/ sq ft

109.93

Construction of Labour Quarters

1448 sq ft

Rs. 342/ sq ft

4.95

Fees of consultant & Architects

3.45

Total

118.33

PLANT & MACHINERIES

The Company proposes to purchase the following Plant & Machineries for its Expansion Project, Quotations for which have been received by the Company from various suppliers and the details are as follows :

NO.

DESCRIPTION OF MACHINERY

SUPPLIER'S NAME

TOTAL

AMOUNT

(including Excise, Sales Tax etc.)

SUN-UP Export Quality 5 Ply in Line

High Speed Combined Automatic Corrugating Board Plant Size 62".

SUN-UP (INDIA) MACHINERY CO. Pvt Ltd.

192.60

SRL 4 x 12 ROTARY

SUN-UP (INDIA)

MACHINERY CO. Pvt Ltd.

1.96

SUN-UP Export Quality 3 Ply in Line

High Speed Combined Automatic Corrugating Board Plant Size 62".

SUN-UP (INDIA) MACHINERY CO. Pvt Ltd.

32.22

SUN-UP Export Quality 3 Ply in Line

High Speed Combined Automatic Corrugating Board Plant Size 62" with C Flute Roll.

SUN-UP (INDIA)

MACHINERY CO. Pvt Ltd.

23.48

Accessories for Export Quality 3 Ply In Line Combined Automatic Corrugating Plant Size 62".

SUN-UP ENGINEERS.

15.54

Thermopac Thermic Fluid Heather

Model TP-06 FO FIRED.

THERMAX LIMITED.

7.25

Double Colour Flexo Printing Machine Size 52" x 90".

MICRO MACHINERY CO. PVT. LTD.

22.30

Flexo Printing Machine 52 x 90

NIRALI TRADING COMPANY.

4.52

Keshaka Brand Sheet Pasting Machine.

KESHAKA WORKS.

1.17

AVELIN Brand Mechanical Portable Platform Steel Yard Scale.

VIVID WEIGHING MACHINES CO.

0.24

Prakash Make Stitching Machine Size 48".

SWETA MARKETING

0.41

EVERITE - 68 Heavy Duty Cutting & Creasing 48" x 68" Machine.

SOND ASSOCIATES (ENGG.) PVT. LTD.

7.67

EVERITE - 36 Heavy Duty Cutting & Creasing 25" x 36" Machine.

SOND ASSOCIATES (ENGG.) PVT. LTD.

3.41

EVERITE - 41 Heavy Duty Cutting & Creasing 28" x 41" Machine.

SOND ASSOCIATES (ENGG.) PVT. LTD.

4.19

MICRO Rotary Cutting and Creasing Size 105".

SHREE PRINTERS EMPORIUM.

2.37

Corrugating Winding Unit.

SUN-UP ENGINEERS.

0.21

Total

319.54

Add : Cost of Installations, Boiler Piping, Chimney, fittings, freight & insurance

12.88

Grand Total

332.42

ELECTRICAL INSTALLATIONS

The Electrical Installations for the UNIT 2 are estimated to cost Rs. 13.61 Lacs as per the quotation received from the M/s. Shree Krishna Engineers, Licensed Electrical Contractor vide their letter 5th October, 2000. Electrical installations as provided in the project cost mainly consists of laying of control cables, bus-bar panel board, electric motors, street lights, complete wiring of the factory, purchase of two DG sets( one of 35 HP and another of 15 HP), fans, other accessories, etc.

MISCELLANEOUS FIXED ASSETS

The details of Miscellaneous Fixed Assets are as follows:

S.No.

Items

Name of the Supplier

Amount (Rs. in lacs)

Furniture and Fixtures

Sanjay Decorators, Baroda

Vide their letter dated 9.10.00

7.01

Computers & Accessories

New Gujarat Electric House, Baroda

Vide their letter dated 3.10.00

7.83

Fire Fighting Equipments

Vishan Distributors, Baroda

Vide their letter dated 2.10.00

5.38

Total

20.22

PREOPERATIVE EXPENSES

The Company proposes to incur Rs.16.71 lakhs for the Preoperative Expenses details for which are as follows:

S.No.

Particulars

Amount (Rs. in lacs)

Travelling - Inland

1.50

Legal & Professional Fees

5.00

Legal Expenses

1.00

Remuneration to Project team

2.29

Establishment Expenses

1.02

Insurance during Construction period

0.75

Deposit for Power Connection

1.75

Market Launch & Trial Exp of Paper Bags for shopping

3.40

Total

16.71

PUBLIC ISSUE EXPENSES

An amount of Rs.36.00 Lakhs has been provided in the Project Cost to meet the issue related expenses like Book Running Lead Manager's Fees, Brokerage & Underwriting Listing fees, SEBI fees, Commission, Registrars Fees, Postage, Printing, Statutory Advertisements, Publicity, Stamp Duty & RoC Charges for increase in authorized capital etc.

CONTINGENCIES

Contingencies have been estimated at Rs.25.03 Lacs to meet any eventualities of inflationary pressures during the time of implementation of the Project. The said amount has been estimated @ 5% of the envisaged project cost of site development, building, plant & machineries, electrical installations and misc. fixed asset combined together .

MARGIN MONEY FOR WORKING CAPITAL

The company has assessed the total margin money for working capital requirement for expansion project for which details are as under:

S. No.

Particulars

Holding Period

Estimate of 2001-02

Current Assets :-

2) Inventory

- Stock of Raw Material.

- Stock of W.I.P.

- Stock of Finished Goods.

1 Month

4 Days

7 Days

78.28

13.77

23.78

Sundry Debtors

2.5 Months

255.73

TOTAL (A)

371.56

Less : Current Liabilities (B)

- Sundry Creditors

1 Month

78.28

Working Capital Requirement (A-B)

293.28

Funded by :

- Working Capital Borrowing from Bank

- Public Issue

146.64

TOTAL

293.28

The company is in the process of applying for sanction of additional facilities for UNIT 2 to the extent of Rs. 146.64 lakhs which would be required at the time of the commencement of commercial production.

Present Limits enjoyed:

Name of the Institution

Type of Loan

Sanctioned Limit ( Lacs )

Outstanding Amount ( Rs. In Lacs )

31-03-2000 25-11-2000

State Bank of Saurashtra

Cash Credit

30.00

25.28

35.36

State Bank of Saurashtra

Term Loan

50.00

44.51

39.97

State Bank of Saurashtra

Tempo Loan

2.81

2.31

Kotak Mahindra

Car Loan

0.00

3.41

The major terms and conditions for the limits with bank are as follows:

Security Terms and Conditions : M. T. Loan of Rs. 50.00 (Rupees Fifty Lacs Only)

Security : Mortgage of Factory, Land & Building and Plant & Machinery Worth Rs. 79.46 Lacs.

Margin : Against Land : 60%

Against Building : 50%

Against Machinery : 25%

Interest : 16.57% Inclusive of Interest Tax. P.A. with quarterly rests subject to change as per RBI directives from time to time.

Repayment Programmed : The advance is to be repaid by 20 equal quarterly instalments with a moratorium period of 6 months.

Insurance : To be obtained for full market value of Fixed Assets & Machinery in the Joint names of bank and the borrowers. Insurance policy shall have to be handed over to the Bank.

Security Terms and Conditions : Cash Credit of Rs 30.00 lakhs

Security, terms and conditions for advances against stocks and book-debts.

Security : Raw Materials :Hypo. Of Stocks of Craft Paper, Gum etc.

Finished Goods : Corrugated Boxes

Stock-In-Process\Sheets etc. Book-debts. :Book-debts & all other Current Assets.

Basis of Valuation : Raw Materials : At Invoice\Market\Govt. Controlled Price Whichever is lower.

Margin 25% of Raw Materials.

25% of Finished Goods.

25% of Stock-in-Process.

50% of Book-debts.

Sub-limits Proposed if any : Finished Goods : Rs. 8.00 (Rupees Eight Lacs Only)

Other Stipulations : Book-debts older than 90 days shall not be financed.

Insurance : All Stocks to be insured against all risks in the joint names of the Bank and Borrower under Comprehensive risk policy, Insurance Policy to be handed over to the Bank.

Interest : 16.32% Inclusive of Interest Tax with quarterly rest, subject to change as per RBI Guide Lines.

Period of Sanction : One Year.

1) Demand Bills (Documentary)

Exchange\Commission Chargeable: Presently 65 Paise Percent + out of Pocket Expenses + Collection Charges Subject to revision from time to time.

2) Demand Bills (Clear)

Exchange\Commission Chargeable: Presently 65 Paise Percent + out of Pocket Expenses + Collection Charges Subject to revision from time to time.

Other General Terms & Conditions are as follows:-

Company to submit C.A. Certificate for capital of Rs. 43.61 Lacs and Unsecured borrowing of Rs. 10.00 Lacs in line of subsidy before release of the loan.

Company shall pay proposal processing charges and upfront fee amounting to Rs. 8000/- before release of the advance.

The Loans shall be collaterally secured by Equitable Mortgage of Company's entire fixed Assets acquired / to be acquired.

The Loans shall be collaterally secured by Equitable Mortgage of Residential Building situated at Surat and owned by Shri. Bhikhabhai Popatbhai Patel. Director of Company.

The Loans shall be collaterally secured by personal guarantee of all the Directors of the Company.

The Loans shall be collaterally secured by Third party guarantee of Shri. Thakorbhai Patel and substantiated by Equitable Mortgage of his Residential Flat situated at Baroda.

The Charge over primary security of Term Loan shall be extended to cover Working Capital loans and vice-versa.

Any change in management / share holding / line of activity or expansion of project etc and any major step will be taken by the Company with prior permission consent of the Bank in writing.

Tempo & Car Loan

These loans are being taken on normal terms and conditions.

TECHNICAL ARRANGEMENTS

The company has not entered into any Technical Arrangement

RAW MATERIALS :

The main raw material required for the manufacturing of corrugated Boxes, Rolls and Sheets are Craft Paper, Gum, Stitching Wire and Printing Inks. At the Installed Capacity of the Project of Unit-2 (7200 Mtpa) 7560 MT of Craft Paper, 446 MT of Gum, 173 MT of Stitching Wire and 58061 Ltrs. Of printing Inks would be required. All the raw material are easily available in the domestic market and the major producers of Deluxe Craft Board Pvt. Ltd., Khatima Fibres Ltd,. Bhadrachalam Paper Mills, Babin Enterprises, Gujarat Sheetal Engineering, Mumbai, Dolphin Inks, Pune etc.. No difficulties are envisaged in procuring the required quantity of raw materials from the indigenous sources.

Water

Water is required only for sanitation and personal consumption, which is being sourced from Company's own borewell within the Factory Premises.

Power

The Unit-2 will require 45 H.P. of Power Necessary application to Gujarat Electricity Board has already been made. There are many other units including the Company's Unit-I are already existing around the said location and hence we do not face any problem in availing power connection. Further, the Company is also proposing to install two DG Sets of 35 HP and 15 HP as 100% Standby arrangement.

Pollution & Effluent Disposal

The Company's manufacturing operations do not generate any effluents / pollution. The Company is exempted from seeking a clearance from the Pollution Control Board as it is classified under non-polluting industry as per Circular No.P-328/24403 dtd.28th November 1995 & No.P-328/389 dtd.5th January 1996.

FUEL :

The Company proposes to install new generation Thermo Pac Thermic Fluid Heater which will be utilised to operate the main Corrugating Machineries instead of using conventional electricity. The use of this Heater not only results in reduction in power consumption but also improves the productivity of the Machineries. In order to operate this Heater, the company will require 43200 Ltrs. of Low Speed Diesel Oil which is easily available freom Companies like Indain Oil Corporation etc...

MANPOWER

At present the company is having the following manpower:

DESCRIPTION

Nos.

Factory Employees :

Production Managers/Supervisors

Skilled Workers

Unskilled Workers

Administration

TOTAL

The total requirement of manpower for the proposed project would be 132, the details of which are as under:

DESCRIPTION

Nos.

Factory Employees :

Production Managers/Supervisors

Skilled Workers

Unskilled Workers

Others

Administration

TOTAL

132

The Company has already recruited one Production Manager. The other factory employees would be recruited at the appropriate time. The Company is a well established player in Karjan and no difficulty is envisaged in recruitment of requisite personnel for the new unit.

MANUFACTURING PROCESS :

a) CORRUGATED BOXES, ROLLS & SHEETS :

The main raw materials required in the process of Manufacturing are Craft Paper, Gum Stitching wire and Printing Inks. The Manufacturing Process will be carried out on Corrugation Machinery for manufacturing Corrugated Boxes, Rolls and Sheets as may be required, the process of which is as under :-

(i) Craft Paper is being tested to meet with the order requirements.

(ii) As per order of the Boxes, Rolls and Sheets, the required Craft Paper of two ply, three ply, five ply and seven ply would be fed in the Corrugating Machine for corrugation.

(iii) The Corrugated Paper would be then cut on Cutting Machine in required dimensions.

(iv) Required ply would be pasted and then the creasing and slotting or punching of the plyed paper would be done.

(v) It would then be stitched to make a Box of specified size.

(vi) All the Boxes will go for inspection in pre-delivery Quality Control Department and thereafter, it would be bundled for despatch.

(vii) In case a order includes Printing as well, the paper after testing in the initial stages would be printed on Offset Printing Machine or Flexo Printing Machine and then sent for pasting as per ply requirements.

(viii) In case the order is only for Sheets or Rolls,they would be bundled for despatch without going to the stage of rotary,slotting and stitching.

TESTING OF CRAFT PAPER

CORRUGATION

CUTTING

PRINTING

PLY PASTING

CREASING

SLOTTING

PUNCHING

STICHING

INSPECTION

BUNDLING

READY FOR DESPATCH

B) PAPER BAGS FOR SHOPPING :

The Raw Material in the form of paper of specified characteristics is procured and tested. The lot of paper will be then cut into required sizes and sent to printing department. As per the requirement of the customer, necessary rubber plates depicting the relevant design and colours will be made under the Company's supervision on job work basis. Thereafter, the said process of printing will be carried out by using the rubber plates. The Sheets so printed will be further cut into the required smaller sizes and punched, glued and fit with accessories like Cords, Rivets, etc...to make it in to a Paper Bags used for Shopping and Carrying Goods. The average weight carrying capacity of the Bags will be ranging from 5 to 7 kgs.

SCHEDULE OF IMPLEMENTATION OF PROJECT

SR. NO.

PROJECT DETAILS

COMMENCEMENT

COMPLETION BY

Acquisition of Land

Already Completed

Site Development

October, 2000

April, 2001

Building

November, 2000

April, 2001

Plant & Machinery, Electrical Installations

- Placement of Order

- Delivery

- Erection ( will be done simultaneously with delivery)

November, 2000

April, 2001

January, 2001

May, 2001

Misc. Fixed Assets

April, 2001

May, 2001

Connections

- Power

- Water

October, 2000

OWN BORWELLS

March, 2001

Trial Production

End May,2001

Commercial Production

June, 2001

PRODUCTS

The man products of the Company are Corrugated Boxes with or without Printing, Corrugated Sheets and Rolls. Corrugated Packaging offers unique blend of advantages unmatched by other modes of packaging.

The structural rigidity and flutings endow the corrugated box with cushioning property to make it ideal for packaging even fragile articles.

Corrugated boxes, being collapsible, are compact, easy and convenient to store. Unlike wooden boxes, which are heavy, corrugated boxes are light-weight and easy to handle. The reduction in tare weight, which could be as much as 66%, results in saving of transportation costs.

Corrugated boxes are strong enough to be stacked up to 25 ft to 30 ft height which is beneficial considering the high costs of floor space.

Corrugated boxes, being tailor-made products can be designed to suit pallet sizes, container sizes godown space etc... The boxes are suitable for handling by various types of material handling equipment.

Another major advantage of corrugated boxes is their printability. Multi-colour printing makes the boxes attractive, eye-catching and enhances shelf-appeal.

Corrugated boxes can be designed innovatively with easy- to- carry handles and other fitments for adding comfort and convenience for use as retail packs and transport packs.

Corrugated boxes can be treated to provide effective protection against water, grease, oil, static electricity, abrasion, etc.

Unlike a wooden box which can be opened and resealed, contents in a corrugated box cannot be pilfered unless the box is torn which makes it pilfer-evident.

Ideal for packaging a variety of products of any shape and size - both as transport containers and as consumer packs- corrugated boxes are extremely versatile and can be used effectively for packing heavy, bulky as well as fragile and perishable products.

Unlike other containers such as metal, plastic, glass, etc., corrugated boxes, made out of kraft paper have an eternally renewable resource- trees. Therefore, use of corrugated packaging supports ecological balance.

Corrugated boxes can be reused, salvage, repulped and remade into boxes. The recyclability and eco-friendliness of corrugated boxes contribute to conservation of natural resources and environmental protection.

INDUSTRY SCENARIO, MARKET & MARKETING ARRANGEMENTS

The word 'packaging' no more sounds new even to the common man. Today, most of the products are offered in packages that are convenient, modern and attractive. Packaging has come to play a vital role in today's life. More and more people both producers and consumers of goods are becoming aware of the importance of effective packaging. In the present competitive market, packaging contributes significantly to the success or failure of product.

Almost all products are required to be packed scientifically in order to ensure that the product reaches in its original from and shape to the end consumer.

Packaging, which is a concept considerably advanced from packing, is today inextricably interwoven into the matrix of our marketing system. This, in turn, is a sequel to the rapid urbanisation and industrialisation that is taking place in our country. The range and variety of the products now being manufactured and the increasing public awareness of the advantages of buying packaged items have made the packaging industry one of the most dynamic segments of our industrial economy. In the sphere of exports too, packaging has assumed special importance because it helps realise higher returns in value terms.

Among the various modes of packaging that are being continuously developed, Corrugated Packaging stands out as the most versatile, secure, efficient and economical. The very fact that almost 95% of all the products in the western world are packed in corrugated boxes as transport containers establishes that corrugated packaging is the most viable and internationally accepted mode of packaging. The growing awareness of the need to maintain environmental and ecological balance has further enhanced the importance of corrugated packaging in the modern world.

It is a well-known fact that corrugated packaging contributes to the conservation of forests as they are accepted as ideal substitutes to wooden packaging.

From a small beginning in early 50's, the use of corrugated packaging has grown by leaps and bounds. In the early days, corrugated boards were imported and a few box units supplied corrugated packaging- mainly to soaps, cigarettes and textile industries.

Now four decades later, the major industries in India which use corrugated packaging are : food; Pharmaceutical; Electrical; Engineering; Consumer Durables; Soaps and Cosmetics; Cigarettes; Glass; Defence; etc.

There is perhaps no product that cannot be effectively packed in a corrugated box. From small, fragile and delicate products like crockery and large products like washing machines, refrigerators... to perishables like fruits and vegetables, almost all products can be effectively and economically packed in a corrugated box.

It has been conclusively proven that generally any item weighing up to 30kg can be properly packed in a corrugated box. In specific cases, products weighing up to 200 kg are also packed in corrugated boxes.

With the development of new and better materials and techniques in the field of corrugated packaging, the range of applications is widening.

In the recent times, corrugated packaging has made a big through in various fields.

Traditional method of packaging fresh fruits in wooden boxes has now become obsolete. Grapes, Mangoes, Apples, Strawberries, and other fresh fruits are now seen in the market, using attractive multicolour, die-cut corrugated boxes. Similarly, fresh vegetables are also packed in corrugated boxes, especially for exports.

Corrugated boxes also find increased use for packaging processed foods like jams, ketchups, etc., and confectionery.

Corrugated boxes are also being used for packing a wide variety of articles by Defence Stores Equipments and Supplies. These include : Brush ware ; Cookware; Plastic and Rubber Items; Heating/Lighting Equipments and Accessories; Screw-drivers and other tools; etc.

Keeping with the times, corrugated packaging is also protecting latest products such as Computers, Laser Printers, Fax Machines, Modems, Cellular Phones, etc.

Point of Purchase Displays are also being made innovatively with corrugated boards and they have proved to be cost- effective and eco-friendly substitutes.

Being a versatile material, it finds uses in non-packaging applications.

INDUSTRY-WISE CONSUMPTION OF CORRUGATED PACKAGING

PARTICULARS

Food Products

27 %

Textile

18 %

Pharmaceutical

09 %

Electrical & Electronics

08 %

Engineering

07 %

Consumer Durables

07 %

Soaps & Cosmetics

07 %

Tobacco, Cigarettes

06 %

Glass

02 %

Defence

01 %

Others

08 %

TOTAL

100 %

(Source : Federation of Corrugated Box Manufacturers Association)

During the last few years, the Industry has grown at a steady rate and the Industry today converts nearly 10 lacs tons of Kraft paper into corrugated boards and boxes.

TONNAGE OF CRAFT PAPER CONVERTED BY THE INDUSTRY :

ACCOUNTING YEAR

In Lakh Tonnes

1995 - 1996

8.75

1996 - 1997

9.25

1997 - 1998

10.00

1998 - 1999

11.00

1999 - 2000

12.50

(Source : Federation of Corrugated Box Manufacturers Association)

Corrugated packaging, designed to conform to international standards of strength and performance, has contributed significantly to the increase of exports, especially in the fields of fruits, vegetables, textiles, processed foods, pharmaceuticals and certain non- traditional items.

In the years to come, corrugated packaging will be a vital factor to ensure India's increasing share in the world market.

The manufacture of corrugated packaging in India began in a small way in the early fifties. The manufacturing units were located only in two or three centres. Today, there are over 1000 units spread all over the country. With increasing demand, newer units are coming up in the vicinity of consuming centres and remote industrial towns.

Today, the corrugated packaging industry is attracting more and more technocrats, engineers and packaging specialists who are are transforming it into a progressive and dynamic industry.

The industry is converting over 11 lakh tonnes of paper per year into boxes/boards.

Keeping in view the need for ecological balance, the corrugated packaging industry has supported the development of non-conventional raw materials as well as use of waste paper in the manufacture of its major raw material - kraft paper.

The corrugated packaging industry has been effectively and completely meeting the packaging requirements of the industry both for domestic need and for exports. There has been no imports of corrugated boxes into the country.

The per capita consumption of paper and paperboard in India at 3 kgs. is one of the largest in the world against a world average of over 45 kgs. With 315 kg, in USA, 225kg in JAPAN, 218kg in SINGAPORE and 18kg in CHINA, there exists tremendous potential for the corrugated packaging Industry in India.

MARKETING STRATEGY

The company has adopted Direct Marketing Approach wherein the top management develops the lead and draw out requisite samples for the potential customers and on approval of the samples prices are finalized. The company proposed to continue the aforesaid approach which will be supplemented by liasioning with leading agents operating in the industry. Through its present system it caters to leading corporates like Viacom (Aiwa), Alembic Chemical Works, Tainwala Personal Products, etc. The Company has approached several large volume players for their Packaging requirements and have been indicated that once it achieves certain critical capacity levels, it can enter into regular contracts. With the completion of expansion, the Company will become one of the top ten players in the Western India Market.

Marketing of Paper Shopping Bags ( New Division)

With increasing consciousness to the negative impact of plastic carry bags throughout the country and imposition of ban by the local municipal corporations, the demand for the shopping bags made out of recyclable paper has increased phenomenally. In order to tap this tremendous potential the company proposes to install an integrated division for manufacturing of various type of Paper Shopping Bags with customization of designs and printing requirements. The company proposes to appoint network of distributors in principal cities on agency terms and which will be ably supported by dedicated team of marketing personnel belonging to the company.

COMPETITION

The company does not envisages any major competition in the field of Paper Shopping bags as there are no major players in the organised sector. In view of the tremendous potential for demand of such products there exists room for new entrants as well.

INSTALLED CAPACITY/CAPACITY BUILD UP

The details of the Capacity building of the production facilities at the Company's existing Unit I since commencement of commercial production are as under :-

P A R T I C U L A R S

Installed Capacity as at the end of the year (MT pa)

Actual Productions

Capacity Utilisation

1998 - 99

(*Commercial Production

Commenced on 24.11.1998)

1200*

120

(4 Months Period)

30%

1999-2000

1200

780

65%

April, 2000 to October, 2000

(*annualised)

1200

595*

85%*

After proposed expansion as envisaged - Corrugated Boxes, Rolls & Sheets

8400

-----

Paper Shopping Bags

30 lacs pieces

The Company is scaling up its operations substantially mainly to achieve critical capacity needed to approach large volume customers in Consumer Durable, Pharmaceutical Industry etc.. The Capacity build-up will also help us in achieving economies of scale in order to improve further margins as well as face the competition.

STOCK MARKET DATA

Presently the equity shares of the company are not listed on any of the Stock Exchange.

MANAGEMENT DISCUSSION & ANALYSIS (last three years)

STATEMENT OF PROFITS & LOSSES

(Rs. in Lacs)

Financial Year Ended

31-3-1997

31-3-1998

31-3-1999

31-3-2000

25-11-2000

Sales / Income from Operations :

Sales

16.64

120.00

154.24

TOTAL

16.64

120.00

154.24

Other Income.

0.19

0.92

1.05

Increase/(Decrease) in Stock.

18.73

16.32

(12.59)

Total (A)

35.56

137.24

142.70

Expenditure :

Consumption of Raw Materials

26.23

82.02

91.74

Manufacturing Expenses

3.50

14.21

13.89

Administrative, Selling & Distribution Expenses

2.61

8.63

9.43

Interest.

4.88

11.82

7.08

Depreciation.

4.19

13.19

10.19

Misc. Expenditure Written Off.

0.19

0.12

Total (B)

41.60

130.06

132.45

Profit Before Tax. (A - B)

(6.05)

7.19

10.25

Provision for Taxation.

Nil

0.83

1.18

Profit After Tax.

(6.05)

6.36

9.07

Dividend & Tax on Dividend

Nil

Retained Earnings

RATIOS :

Net Worth

1.13

31.21

45.70

46.19

262.28

RONW (%)

14.57%

5.35%*

Book Value Per Share (Rs.)

376.67

10,403.33

10.47

10.58

10.32

EPS (Rs.) Simple Average

1.46

0.54*

Note : None of the assets are being revalued since incorporation

Statement of Assets and Liabilities

(Rs. in Lacs)

Financial Year Ended

31-3-1997

31-3-1998

31-3-1999

31-3-2000

25-11-2000

A) Fixed Assets at Cost

Nil

29.05

102.37

115.11

140.51

Less : Depreciation

Nil

4.19

17.39

27.58

Net Block

Nil

29.05

98.18

97.72

112.93

Capital Work in Progress

5.85

18.92

55.09

B) Investments

Nil

71.67

C) Current Assets, Loans & Adv :

Inventories

Nil

18.73

35.05

22.46

Debtors

Nil

6.56

43.12

93.86

Cash and Bank Balances

0.03

0.01

1.27

7.35

11.35

Loans and Advances

1.01

0.05

1.22

0.52

10.05

TOTAL (A)

1.04

0.06

27.78

86.04

137.72

D) Current Liabilities & Prov. :

Current Liabilities

Nil

Provisions

0.01

3.73

3.81

94.68

34.07

TOTAL (B)

0.01

3.73

3.81

94.68

34.06

E) Net Current Assets (A-B)

1.13

-3.68

23.97

(8.64)

103.65

F) Misc. Expenses not W/Off

0.01

0.11

1.66

1.48

1.36

G) Profit & Loss Account

Nil

6.05

Nil

H) Total Assets

1.14

31.32

129.86

181.15

344.70

Represented By :

I) Share Capital

0.03

43.66

254.26

J) Share Application Money

1.11

31.29

3.70

Nil

K) Reserves and Surplus

Nil

0.31

9.38

L) Secured Loans

Nil

72.91

72.61

81.06

L) Unsecured Loans

Nil

9.59

60.87

Nil

M) Total Liabilities

1.14

31.32

129.86

181.15

344.70

Notes on Accounts :

1) Significant Accounting Policies :

(i) The financial statements are prepared under the historical cost convention and in accordance with the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and relevant presentational requirements of the Companies Act, 1956.

(ii) Recognition of Expenditure :

The Company follows the accrual method of accounting and all liabilities are provided on that basis.

(iii) Raw Materials, Work-in-Progress and Finished Goods are valued at cost or realizable value whichever is less on FIFO basis.

(iv) Fixed Assets and Depreciation :

a) Fixed Assets are stated at cost. Cost of Assets is inclusive of all other incidental expenses.

b) Depreciation is provided on Written Down Value Method in accordance with the Schedule XIV of the Companies Act, 1956.

2) Write off of Preliminary Expenditure :

Preliminary Expenses are being written off over a period of 10 years from the date of commencement of commercial production.

3) Term Loan from State Bank of Saurashtra, Karjan Branch is secured by way of first equitable mortgage of Land, Building, Plant and Machineries, Dies and Tools, etc. as well as Personal Guarantee of all the Directors.

Cash Credit from State Bank of Saurashtra, Karjan Branch is secured by Hypothecation of Raw Material, Work-in-Process as well as Finished Goods and Personal Guarantee of all the Directors.

Temp Loan from State Bank of Saurashtra, Karjan Branch is secured by Hypothecation of Tempo and Personal Guarantee of Directors.

4) No provision has been made for Gratuity since the payment of Gratuity Act, 1972 is not applicable to the Company.

5) The Company has made Trade Investment in Shreeji Copper Private Limited. The Investment is made at Rs. 10/- per Share. Due to the said Investment, Shreeji Copper Private Limited becomes wholly owned subsidiary.

6) Balances of Sundry Debtors, Sundry Creditors, Secured Loans and Bank balance, etc. are subject to confirmation and reconciliation, if any.

7) In the opinion of the Board, all the known Liabilities are provided for and at all the Current Assets, Loans and Advances have a value on realization as near to the value stated in the Balance Sheet if realized in ordinary course of business.

8) Auditor's Remuneration : Audit Fees : Rs. 10,500/-.

9) Directors' Remuneration : Rs. 48,000/-

10) A) Value of Imports on CFI Basis : Nil.

B) Expenditure in Foreign Currency : Nil.

C) Earning in Foreign Exchange : Nil.

D) On Export of Goods FOB Basis : Nil.

11) During the year, the Authorised Share Capital of the Company was increased from Rs. 1,00,00,000/- (Rupees One Crore Only) to RS. 11,00,00,000/- (Rupees Eleven Crores Only). The formalities for filing necessary forms with the Registrar of Companies, payment of Stamp Duty and Registration Fees are still pending.

12) Figures of the Current Year are for the period from 1st April, 2000 to 25th November, 2000. Thus, the figures of the previous year are not comparable with that of the previous year.

13) All Schedules forms and integral part of the Audited Accounts.

1. MANAGEMENT DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION AND RESULTS OF THE OPERATION AS

(Rs. in Lakhs)

Particulars

97-98

98-99

99-00

Total Income (A)

35.56

137.24

% Change

Total Expenditure (B)

41.60

130.06

% Change

Profit after Tax

(6.05)

6.36

% Change

EPS

Nil

1.46

% Change

Note : The company started its operations in November 1998 only as a result of which the financial year ended 31.03.99 showed a loss of Rs. 6.05 lakhs

Management Discussion And Analysis of Financial results :-

Unusual or infrequent events or transaction

There are no unusual or infrequent transactions in the last three years

Significant economic changes that materially affected or are likely to effect income from continuing operations

The company is dealing in the Corrugated Packaging Products and hence any economic changes related to the same field will materially affect the operations. Some of the factors may be as follows:

* Changes in the tax structures in States within the Union of India

* Any slow down in the economy

Known trends or uncertainties that have had or are expected to have a material adverse impact on sales , revenue, or income from continuing operation:

* Competition from other Indian companies in the organised as well as unorganised sector.

* Solvency & payment abilities of clients

Future changes in relationship between costs and revenues in case events such as labour or material costs or prices that will cause a material change are known.

As the company is engaged in the business of conversion, normally there are no major changes between the cost and revenue.

The extent to which material increase on net sales or revenue are due to increase sales volume, introduction of new products or services or increased sales prices.

Total turnover of each major industry segment in which the Company operated

The industry size is estimated at about Rs. 2,750 crores with conversion of about 11 lacs tons of craft paper on an annual basis.

(Source : Federation of Corrugated Box Manufacturers Association)

Status of any publicly announced new products or business segment

None

The extent to which business is seasonal.

Non seasonal

Any significant dependence on a single or few suppliers or customers.

The company is not dependent on single or few suppliers & customers for its purchase & sales respectively.

SWOT ANALYSIS BY THE COMPANY:

STRENGTHS :

* Existing profit making operations for last one and half years and expanding to achieve economics of scale and critical capacity size to cater to large volume customers.

* Promoters have good experience in the Corrugated Packaging Industry and have developed good efficiency and quality standards.

* Present Customer base includes leading Corporates like Viacom (AIWA), Alembic Chemicals Works, Alembic Glass Works, JCT Electronics, Sugam Diary etc...

* Corrugated Packaging Industry is consistently enjoying steady growth for last several years.

WEAKNESS :

* The present capacity is relatively small to enter into any long term relationship with large volume customers

OPPORTUNITIES :

* The large volume players amongst the present customers are willing to enter long term relationship on achieving critical capacity size to ensure efficient & regular servicing of orders.

* Corrugated Packaging Industry cater to wide spectrum of Industries enjoying steady growth.

* Paper Shopping Bags is one of the fastest growing segments in view of negative impact of Plastic Bags on environment.

* Very few players in Paper Shopping Bags in the Organised Sector.

THREATS:

* The Corrugated Industry has low entry barriers and is exposed to potential competition.

MATERIAL DEVELOPMENTS

There are no material developments after the date of the latest audited balance sheet as on November 25,2000 which may materially effect the performance or prospects of the Company.

As per the opinion of the Directors, no circumstances have arisen since the date of last financial statement disclosed in the prospectus that materially and adversely affect or are likely to affect the profitability of the Company, or the value of its assets, or its ability to pay its liabilities within the next twelve months.

FINANCIALS OF GROUP COMPANIES.

The company has acquired Shreeji Copper Pvt. Ltd. details for which are already shown under the heading Subsidiaries of the Company in the prospectus.

Further, Mr. Pravin P Patel, one of the promoters is interested in M/s Sawan Gems, Mumbai as partners. The firm is engaged in trading and export of diamonds. The details of the said firm are as follows:

Date of Establishment : June, 1995

Nature of Activities : Trading and exports of diamonds

Partners' Capital as on 31.03.00 : 56.79 lakhs

Sales for the year 99-00 : 282.35 lakhs

Net Profit for the yr 99-00 : 61.47 lakhs

PARTICULARS OF ISSUES MADE BY COMPANIES UNDER THE SAME MANAGEMENT IN THE LAST THREE YEARS

There have been no issues in the last three years made by Companies under the same management as defined under Section 370 (1B) of the Act.

OUTSTANDING LITIGATION / DISPUTES / DEFAULTS

There are no pending litigation against the Company & Promoters of the Company.

There are no defaults to the Financial Institutions, Banks ,Re-schedulement of loans to Banks/FI's by the Company. However dues pending for payment to the Financial Institutions are highlighted below.

There are no pending litigation ,disputes defaults non payment of statutory dues , proceedings initiated for offences (including the past cases and irrespective of whether specified in paragraph (i) of part I of schedule XIII of the act against the promoters , Family Members, and their other business ventures .

There are no cases of litigations pending against the Company/Group Companies whose outcome could have a materially adverse effect on the position of the Company.

There are no pending litigation's against the Promoters / Directors in their personal capacities and also involving violation of statutory regulations or criminal offences.

No directors of the company have any litigation towards tax liabilities, any criminal \civil prosecution against them for any offences etc.

There are no pending proceedings initiated for economic offences against the Directors, Promoters, Companies and Firms promoted by the promoters.

There are no outstanding litigation's, disputes pertaining to the matters likely to affect the operations and Financials of the Company including disputed tax liability, prosecution under any enactment in respect of Schedule XIII of the Companies Act, 1956.(1 of 1956) and civil / criminal prosecution against promoters / Directors of the company.

There are no litigations outstanding against the promoters/Directors in their personal Capacity. The Company, its promoters/Directors and other Companies with which promoters are associated have neither been suspended by SEBI nor any disciplinary action has been taken by SEBI. There are no prosecutions launched by Income Tax Authorities and no liability compounded by the Promoters/ Company/Companies/Ventures with which the promoters are associated is subsisting.

There are no cases of pending litigation/defaults in respect of the firms / Companies with which the Promoters are associated in the past but are no longer associated.

Present Limits enjoyed:

Name of the Institution

Type of Loan

Sanctioned Limit ( Lacs )

Outstanding Amount ( Rs. In Lacs )

31-03-2000 25-11-2000

State Bank of Saurashtra

Cash Credit

30.00

25.28

35.36*

State Bank of Saurashtra

Term Loan

50.00

44.51

39.97

State Bank of Saurashtra

Tempo Loan

2.81

2.31

Kotak Mahindra

Car Loan

0.00

3.41

* Note : This figure is as per audited financial statements and the reconciliation statement confirms to bank limits.

STOCK MARKET DATA

As the shares of the Company are yet to be listed on any Stock Exchanges, no quotation for the market price of its shares is available.

BASIS OF ISSUE PRICE

Quantitative Factors

1. Adjusted EPS

Year

E.P.S (Rs.)

Weights

1997-98

1998-99

1999-00

1.46

Weighted Average for last 3 years (Rs.)

(note 1)

Note 1: The company started its operations in November 1998 only as a result of which the financial year ended 31.03.99 showed a loss of Rs. 6.05 lakhs

EPS represents basic earnings per share = Profit after tax divided by Number of outstanding shares at the end of the year. Each share is considered of Rs. 10/- each.

3. Price/Earning ratio (P/E ratio) in relation to issue price Rs. * per share

*Note : to be determined after the issue price is being finalized.

Industry (Packaging):

Highest 19.7

Lowest 1.7

Average (Industry composite) 10.5

(Source - Capital Markets Vol XV/17, November 12, 2000)

Industry (Paper):

Highest 17.8

Lowest 2.3

Average (Industry composite) 7.2

(Source - Capital Markets Vol XV/17, November 12, 2000)

3. Return on Net Worth % (RONW)

RONW

Weights

31/03/98

31/03/99

31/03/2000

14.57

4. Minimum return on total net worth after the issue needed to maintain EPS at Rs. 5.31 is *%

*Note : to be determined after the issue price is being finalized.

5. Net Asset Value (NAV) per share.

a. As on 31.03.2000 Rs. 10.79

b. After issue Rs. *

c. Issue Price Rs. *

*Note : to be determined after the issue price is being finalized.

INVESTOR GRIEVANCES AND REDRESSAL SYSTEMS

Since this is the first public issue of shares by the Company, there is no past history of Investor grievances. For the public issue and on completion of this public issue, the Company has made arrangements with the Registrars to the Issue to handle and redress investor grievances promptly for a period of 6 months beginning from the last date of despatch of letters of allotment / share certificates/ refund orders and keep the Company appraised of their redressal to complaints/ grievances on weekly basis. By the time of completion of the six months period, the Company will put in place a suitable infrastructure / mechanism for prompt and effective redressal of invest or grievances. The Company has nominated Mr. R. Sridharan as the Compliance Officer to deal with grievances and redressal system.