Private and Confidential
(Only for Equity Shareholders of the company)
Draft Letter of Offer
Apollo Sindhoori Capital Investments Ltd.
(Incorporated on 4.7.1995 under the Companies Act, 1956)
Registered & Head Office: Ali Towers – 55, Greams Road, Chennai – 600 006.
Tel.: (044) 3919 0002/03, Fax: (044) 28290835
E-mail:geethas@ascilonline.com; Website: www.apollosindhoori.com
RIGHTS ISSUE OF 5,54,000 Equity Shares of Rs. 10/- each at a premium of Rs. 90/- per share (i.e.
at a price of Rs. 100/- per share) in the ratio of One (1) equity share for every five (5) equity
shares held on the Record date (i.e. _________) aggregating Rs. 55.4 Million
GENERAL RISK: 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 risk involved. The securities have
not been recommended or approved by Securities and Exchange Board of India (SEBI) nor does
SEBI guarantee the accuracy or adequacy of this document. The attention of the investors is
drawn to the statement of Risk Factors appearing on Page no. 4 of the Letter of Offer.
ISSUER’S ABSOLUTE RESPONSIBILITY: The Issuer, having made all reasonable inquiries,
accepts responsibility for, and confirms that this Letter of Offer 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 Letter of Offer 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 of the Company are listed on Madras Stock Exchange (“Designated
Stock Exchange”), and traded on Bombay Stock Exchange Ltd. (BSE) (IndoNext segment). The
Equity shares to be issued through this issue would also be listed on the MSE and traded on BSE
IndoNext as mentioned above. The company will make an application to MSE for permission to
deal in and for an official quotation in respect of the Equity Shares arising out of the Issue. The
details of the in-principle approval obtained from MSE have been furnished in this Letter of
Offer.
Note: The attention of investor is drawn to the statement of Risk Factors appearing on page 4
of this Letter of Offer.
Lead Manager to the Issue
Registrar to the Issue
SBI CAPITAL MARKETS LTD.
202, Maker Tower ‘E’
Cuffe Parade, Mumbai 400 005
Tel: (022) 22189166, Fax: (022) 22188332
E-mail : ascil.rightsissue@sbicaps.com
CAMEO CORPORATE SERVICES LTD
Subramanian Building, No.1,
Club House Road, Chennai – 600 002
Tel: (044) 28460390, Fax: (044) 28460129
Email: cameo@cameoindia.com
ISSUE OPENS ON
LAST DATE FOR RECEIVING REQUESTS FOR SPLIT FORMS
ISSUE CLOSES ON
: ______ , 2006
: ______ , 2006
: ______ , 2006
INDEX
DEFINITIONS & ABBREVIATIONS................................................................................................................... II
RISK FACTORS AND MANAGEMENTS PERCEPTION ..................................................................... 4
GENERAL INFORMATION.................................................................................................................... 11
CAPITAL STRUCTURE............................................................................................................................ 18
PARTICULARS OF THE ISSUE .............................................................................................................. 22
BASIS FOR ISSUE PRICE ......................................................................................................................... 23
TAX BENEFITS .......................................................................................................................................... 25
INDUSTRY OVERVIEW........................................................................................................................... 31
BUSINESS ................................................................................................................................................... 36
HISTORY .................................................................................................................................................... 42
PROMOTER & PROMOTER GROUP .................................................................................................... 46
MANAGEMENT ....................................................................................................................................... 49
KEY MANAGERIAL PERSONNEL........................................................................................................ 56
GROUP COMPANIES ...................................................................................................................................... 58
SUBSIDIARIES........................................................................................................................................... 71
FINANCIAL PERFORMANCE OF THE COMPANY....................................................................................... 72
AUDITORS’ REPORT ............................................................................................................................... 72
MANAGEMENT DISCUSSION AND ANALYSIS OF THE FINANCIAL PERFORMANCE ....... 91
OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS ............................................ 94
REGULATORY APPROVALS ................................................................................................................. 98
TERMS OF THE PRESENT ISSUE ........................................................................................................ 100
WORKING RESULTS AND OTHER INFORMATION ..................................................................... 123
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION............................................. 125
DEFINITIONS & ABBREVIATIONS
Act
ADR
AGM
Articles
The Companies Act, 1956
American Depositary Receipt
Annual General Meeting
Articles of Association of the Company
ASCIL, the Company, Issuer
ASCTL
Apollo Sindhoori Capital Investments Ltd.
Apollo Sindhoori Commodities Trading Limited
Board
Board of Directors of Apollo Sindhoori Capital Investments Ltd.
BSE
BSE IndoNext
Bombay Stock Exchange Ltd.
A separate trading platform under the BSE Online Trading
(BOLT) system of the BSE. It is a joint initiative of BSE and the
Federation of Indian Stock Exchanges (FISE) of which 18
regional stock exchanges (RSEs) are members to facilitate
trading in Small and Medium Enterprises (SME) listed with
RSEs.
Book Value
Composite Application Form
Compounded Annual Growth Rate
Central Depository Services (India) Ltd.
Madras Stock Exchange Limited
Depository Participant
Earning Per Share
Futures & Options Broking
Foreign Currency Non Resident
Foreign Exchange Management Act, 1999
Foreign Institutional Investor (registered with SEBI)
Financial Year
General Depository Receipt
Government of India
Initial Public Offering
Issue of 5,54,000 Equity Shares of Rs. 10/- each at a premium of
Rs. 90/- per share (i.e. at a price of Rs. 100/- per share) on rights
basis to existing shareholders of the company in the ratio of one
(1) equity share for every five (5) equity share held on the
Record date aggregating Rs. 55.4 Million
Income-tax Act, 1961
SBI Capital Markets Limited
Letter of Offer dated _______ circulated to shareholders
BV
CAF
CAGR
CDSL
Designated Stock Exchange
DP
EPS
F& O Broking
FCNR
FEMA
FII
FY
GDR
GoI
IPO
Issue / Rights Issue / Offer
IT Act
Lead Manager
Letter of Offer / Offer
Document
LoF(s)
MCX
Memorandum and Articles
MSE
NCDEX
NMCE
Letter of Offer
Multi Commodity Exchange of India Ltd.
Memorandum and Articles of Association of the company
Madras Stock Exchange Limited
National Commodity and Derivatives Exchange, India Ltd.
National Multi Commodity Exchange of India Ltd.
ii
NRE
NRI
NRO
NSDL
NSE
OCB
OTCEI
PAN
PAT
PBDIT
PBT
RBI
Record date
Registrar to the Issue /
Registrar
Resident
ROC
SEBI
SEBI guidelines
SLR
UTI
Non Resident External
Non-Resident Indian
Non Resident Ordinary
National Securities Depository Ltd.
National Stock Exchange of India Limited
Overseas Corporate Body
Over The Counter Exchange of India
Permanent Account Number
Profit After Tax
Profit Before Depreciation, Interest and Tax
Profit Before Tax
Reserve Bank of India
_________, 2006
Cameo Corporate Services Limited
Person Resident in India
Registrar of Companies
Securities and Exchange Board of India
The Guidelines for Disclosure and Investor Protection issued by
SEBI and subsequent amendments thereon
Sri Lanka Rupee
Unit Trust of India
In this Letter of Offer, the terms “we”, “us”, “our”, “its”, “Company’s”, “ASCIL”, “Issuer” or
“the Company”, unless the context otherwise implies, refer to Apollo Sindhoori Capital
Investments Ltd., a company incorporated on 4.7.1995 under The Companies Act, 1956.
All references to “Rs.” refer to Rupees, the lawful currency of India. Any discrepancies in any
table between total and the sums of the amount listed are due to rounding off.
iii
RISK FACTORS AND MANAGEMENTS PERCEPTION
Investors should consider the following risk factors together with all other information included in this
Letter of Offer carefully, in evaluating the company and its business before making any investment
decision. Any projections, forecasts and estimates contained herein are forward-looking statements and
are based on certain assumptions that company considers reasonable. This Letter of Offer contains
forward-looking statements that involve risks and uncertainties. Such statements can be identified by the
use of forward-looking terminology such as “may”, “believes”, “will”, “expect”, “anticipate”,
”visualize”, “estimate”, continue”, “plan”, “likely” or other similar words. Actual results could differ
from those anticipated in these forward-looking statements as a result of various factors, including those
set forth in the following risk factors and elsewhere in this Letter of Offer.
This Letter of Offer also includes statistical and other data regarding the Indian Broking industry. This
data was obtained from industry publications, reports and other sources that the company and the Lead
Manager believe to be reliable. Neither the company nor the Lead Manager has independently verified
such data.
An investment in equity shares involves a high degree of risk. You should carefully consider all
of the information in this Letter of Offer, including the risks and uncertainties described below,
before making an investment in our Company’s Equity Shares. If any of the following risks
actually occur, our business, financial condition and results of operations could suffer, the
trading price of our Equity Shares could decline, and you may lose all or part of your
investment.
INTERNAL RISK FACTORS
(a) The purpose for which the funds are being raised has not been appraised by an external
agency and these are based on the Company’s estimates.
The funds are being raised for part-financing the Company’s expansion plan, which includes
setting up of branches and investment in technology upgradation. The cost of the expansion
plan is based on the company’s estimates and is not appraised by any external agency. No
independent agency has been appointed for monitoring the use of proceeds.
Management Perception:
The Company has incurred a sum of Rs. 38.3 million towards the expansion plans and has set
up 51 new branches during the period April-October 2005. Out of the project cost of Rs. 208
Million, Rs. 102.6 Million is proposed to be funded through internal accruals. Around Rs. 50
Million is proposed to be funded through term loans, which have already been tied up and the
balance amount of Rs. 55.4 Million is to funded by this rights issue. The Company’s Audit
committee would be monitoring the use of proceeds from the issue, which will be reported
periodically as per Listing Requirements.
For further details, refer to the section titled “Particulars of the Issue” in Page No. 22.
(b) We are and have in the past been involved in certain legal proceedings, claims, enquiries,
and investigations.
Our Company is involved in certain legal proceedings including arbitration proceedings and
claims against us in relation to certain contractual, employment, and other civil matters.
All of the legal proceedings/claims are pending at different levels of adjudication before
various courts, arbitrators, stock exchanges and appellate tribunals. The total liability
contemplated, to the extent quantifiable; in case of the pending litigations is Rs. 77.6 Million.
The net worth of the company as on 31.3.2005 was Rs. 181.6 Million.
4
SEBI ordered an enquiry against ASCIL in 2002 and an enquiry officer was appointed by SEBI
under Regulation 28(1) of SEBI (Stock Brokers and Sub-Brokers), Regulations, 1992.
Subsequently, SEBI issued a show cause notice dated 14.10.2003 to ASCIL based on the report
of Enquiry officer under the SEBI Regulations 2002 for violation of provisions of the Securities
Contracts (Regulation) Act, 1956, SEBI (Stock Brokers and Sub-Brokers) Rules and Regulations,
1992 and several SEBI directives, Rules and Regulations and bye-laws of Stock Exchange. The
company has obtained a stay on 6.11.2003 from the Hon’ble High Court of Madras against
operation of the show cause notice and SEBI has filed its counter on 22.1.2004. The case is yet to
be listed for hearing.
NSE has issued a show cause notice to ASCIL for payment of turnover fee as determined by
SEBI vide letter dated 15.3.2005. The turnover fee is on account of an additional registration
number allotted by NSE to ASCIL. This number has been allotted without the knowledge of
ASCIL and the same has not been used by ASCIL. The company has obtained stay from the
Hon’ble High Court of Madras on 24.3.2005 against the operation of the show cause notice and
NSE is yet to file its counter. The amount of claim contemplated is Rs. 26.1 Million.
In addition to the above, there have been certain investigations, inspections and enquiries that
have been initiated by NSE and SEBI in the past and our Company and our subsidiary may be
subject to such investigations and/or enquiries from the Stock Exchanges, SEBI, RBI or any
other regulatory authorities in the future. Our Company and our subsidiary have also been
fined for certain irregularities in the past. Any fines or penalties imposed upon us could
increase our expenses and current liabilities. The outcome of such investigation, inspection and
consequences in the past has not adversely affected our business.
For more information regarding litigation, investigations, enquiries and inspections please
refer to the section titled “Outstanding Litigation and Material Developments” beginning on
page no.94 of this Letter of Offer.
(c) Our business is dependent on systems and operations availability; any breakdowns in the
transaction systems could lead to decline in our sales and profits.
We face a risk of system failure that may result in reduced traffic, reduced revenues and harm
to our reputation. Our business is technology intensive with most critical functions such as the
gathering, processing and dissemination of information and the timely execution of
transactions being dependent on the smooth functioning of several control processes and
technology systems and as such our business and operations could be significantly impacted to
the extent we experience system interruptions, errors or downtime (which could result from a
variety of causes, including changes in client use patterns, technological failure, changes to its
systems, linkages with third-party systems, and power failures). Risk could also be faced due
to failures in crucial processes and systems. Similarly, sudden and rapid increases in client
demand may strain our ability to ramp-up our technology and expand our operating capacity.
Management Perception:
To avert interruption due to power failures, the company has a back up by way of UPS with
redundancy and a high capacity generator. To avoid system interruptions, we have a “raid” on
the server wherein, upon failure of one hard disk, the other will take the place. To avoid
connectivity failures, the company has tied up with two different vendors to offset any system
failure thereby preventing a total failure. The existing server has the capacity to manage four
times the existing volume, and it can be upgraded to meet increase in client demand.
(d) We extend credit to our clients in case they are unable to pay before the pay-in date of the
exchange and any default by a client coupled with a downturn in the market, could result
in substantial losses.
5
If the client is not able to pay the amount due before the pay-in date of the exchange for the
said transaction, we, at times extend credit to clients for the purchase of shares.
In case of highly volatile market or adverse movements in share price, it is possible that the
clients may not honour their commitment, which may result in losses. Such an event would be
detrimental to our business and profitability.
(e) Risks attributable to derivatives trading by clients and possible inadequacy of risk
management policies.
Our Company and our subsidiary offer a facility to trade in derivative instruments in the
securities and commodities, as currently permitted in India. Since these derivative instruments
involve leveraged positions on the underlying assets, these are riskier to deal with as compared
to the financial instruments. The investors or market intermediaries are exposed to greater risk
in dealing with such instruments. Our Company and our subsidiary are exposed to greater risk
in dealing with derivative instruments since they deal with such instruments on behalf of their
clients. Our Company and our subsidiary may face financial losses if they fail to manage the
risk of our clients’ dealing in derivative instruments.
Management Perception:
Our Company and our subsidiary have developed advanced technology systems to manage
the risks involved in dealing with derivative instruments on behalf of clients. These systems
involve minimum human intervention and are dependent on system generated risk alerts and
other data points for efficient risk management.
Also, our Company and our subsidiary take adequate margins from clients as specified by the
exchange before dealing in derivative instruments.
(f) Liquidity of the equity shares of ASCIL is low due to poor trading of the security on MSE.
There is low trading of the equity shares of the company on MSE and there has been no trading
on MSE since 20.8.2005. Price discovery may be affected and the potential value of the equity
share may not be discovered due to illiquidity.
However, the equity shares of the company are permitted to be traded on BSE IndoNext. The
average daily volume of equity shares on BSE IndoNext in past 1 month has been
approximately 2000 shares.
(g) The performance of Om Sindhoori Capital Investments Limited (OSCIL) compares
unfavourably as compared to the projections made in the Prospectus/ LOF for public issue.
OSCIL was merged with ASCIL vide Court Order dated 12th March 2001 w.e.f 1.10.1999.
The EPS of OSCIL was Rs. 1.48 in FY 95, Rs. 1.68 in FY 96 and Rs. 1.71 in FY 97 as compared to
the projected EPS of Rs. 3.26 in FY 95, Rs. 2.6 in FY 96 and Rs. 5.24 in FY 97. The Book Value per
share of OSCIL was Rs. 10 in FY 95, Rs. 10.63 in FY 96 and Rs. 10.99 in FY 07 as compared to the
projected book value of Rs.10.42 in FY 95, Rs. 11.02 in FY 06 and Rs. 14.04 in FY 07. For further
details refer to page no. 45 in the Section titled “History”
Management Perception:
OSCIL was an NBFC in the business of leasing. In 1998, RBI announced stricter prudential
norms for NBFC ’s leading to tougher operating conditions for NBFC. This accounted for the
variation in the performance as compared to projections. The object of the merger with ASCIL
was to provide an exit route to the shareholders of OSCIL.
(h) Our 100% subsidiary Apollo Sindhoori Commodities Trading Limited (ASCTL) has made a
6
loss of Rs. 0.86 Million for the period of 15 months ending 31.12.2004.
Management Perception:
ASCTL has made a profit of Rs. 0.47 Million for the period of 3 months ending 31.3.2005 and
the net worth of the company is Rs. 9.1 Million as on 31.3.2005.
(i) Our business is dependent on relationships formed by our dealers or branch managers
with our clients; any events that harm these relationships including the loss of our dealers
or branch managers will lead to decline in our sales and profits.
Our Company and our subsidiary had 200 dealers and 50,000 clients as of 30.09.2005; while no
dealer/ branch manager contributes a meaningful percentage of the business, the business
would suffer materially if a substantial number of dealers/ branch managers either become
ineffective or leave the organisation. Such an event would be detrimental to our business and
profits.
Management Perception:
The company creates a line of potential/ second dealers and branch heads as support at Head
Office/Major branches to avert such unforeseen circumstances.
(j) We depend on our management team and the loss of team members may adversely affect
our business.
Our Company and our subsidiary believe that we have a strong team of professionals to
oversee the operations and growth of our businesses. If one or more members of our
management team are unable or unwilling to continue in their present positions, such persons
would be difficult to replace and our business would be adversely affected. We may lose our
key management team to our clients or competitors. For details on our Key Managerial
Personnel, please refer to page no. 56 in the section titled “Key Managerial Personnel”.
Management Perception:
The company has institutionalized relationships over a period of time and is of view that losing
key management personnel may not significantly hamper its business.
(k) Contingent Liabilities could create an additional financial burden on our Company.
As of March 31, 2005, our Company had contingent liability of Rs. 110 Million. For further
details, refer to the section titled “Financial Performance of the Company” in Page No. 80.
(l) Branch business risk
With a view to servicing customers closer to their location, the Company runs its operations
through a network of owned branches and franchisees. We have 320 franchisees as on 30.9.2005
and 69% of Income from operations in FY 2004-05 was contributed by franchisee business.
There are risks associated with both.
Franchisees
While franchisees work under the overall supervision of the Company as per its policies, on a
revenue sharing basis, they are typically independent entrepreneurs and not employees of the
Company. There is a risk in terms of the franchisees indulging in undesirable trade or market
practices.
Such franchisees might face a conflict of interest with the Company on selling of products
profitably. The franchisees might transgress the regulations or may fail to observe compliance
with business practices knowingly or unknowingly. These practices might result in loss of
reputation and business for the Company.
7
Management Perception:
The Company has a centralized risk management system, which monitors trading activities of
the franchisees and their clients. The company conducts inspections at periodic intervals and
any undesirable trade or market practices are brought to the Disciplinary Action Committee for
suitable action.
Branches
The Company intends to expand its owned branch network from 50 owned branches, as of
March 31, 2005, to 300 branches in coming years. Given the number and geographical
dispersion of the branches, the Company may not be able to effectively monitor or supervise
the operations of the branches, which may result in breach of compliance requirements.
Evaluation and actual setting up of branches entails a cost to the Company in terms of
manpower, financial resources, etc. In case the location selected for setting up a branch turns
out to be unprofitable, the Company may have to close down such branches. This may lead to a
strain on the Company in terms of investment made, which might affect the operations and
financial performance of Company.
Management Perception:
The Company follows a centralized approach of monitoring risk from its Corporate Office. The
Company has an evaluation methodology of selecting the location before opening any branch.
The Company mostly operates its branches from leased premises and in case of closure of
branch, the manpower, equipment as well as clients can be shifted to the nearest alternative
location. As of now, the Company has not closed down any of its branches.
(m) Our business is rapidly growing; any inability to manage this rapid growth could result in
disruptions in our business and may result in reduced sales and profits.
Any failure on our part to scale up our infrastructure and management to meet the challenges
of rapid growth could cause disruptions to our business and could be detrimental to our longterm business outlook.
(n) We and our subsidiary may require further infusion of funds to satisfy our capital needs,
which we may not be able to procure. Any future equity offerings by us may lead to
dilution of equity and may affect the market price of our equity shares.
Our growth is dependent on having a strong balance sheet to support our activities. We may
need to raise additional capital from time to time, dependent on business conditions and we
may not be able to procure such additional funds due to factors beyond our control. The factors
that would require us to raise additional capital could be business growth beyond what the
current balance sheet can sustain; additional capital requirements imposed due to changes in
regulatory regime or new guidelines; or significant depletion in our existing capital base due to
unusual operating losses. Any fresh issue of shares/convertible securities would dilute the
share holding of the existing holders, and such issuance may not be done at terms and
conditions, which are favourable to the then existing investors or us.
(o) Any future acquisitions of businesses may expose us and our subsidiary to new risks
leading to a failure in realising the benefits of such acquisitions thereby adversely
impacting our profitability.
We may fail to realize the anticipated benefits of future acquisitions and we may incur costs
that could adversely impact our profitability. We may acquire other businesses, technologies
and products that we believe are a strategic fit with our business. In such an event, we may not
be able to successfully integrate any businesses, products, technologies or personnel that we
might acquire without a significant expenditure on operating, financial and management
8
resources. Future acquisitions could dilute shareholders’ interest in us and could cause us to
incur substantial debt, expose us to contingent liabilities and negatively impact our
profitability.
(p) Some of the group companies have incurred losses in the last three years. For further
details, refer to the section titled “Group Companies” in Page No. 58.
Management Perception:
As the business activities of the group companies are different from our business, the losses
will not have any impact on us.
(q) Our strategy to enter into the sale of diversified financial services and products exposes us
to additional risks.
Our Company and our subsidiary are expanding our business offerings and these additional
products might expose us to new business risks for which we may not have the capability or
the systems to manage.
(r) Future sales by current shareholders could cause the price of the equity shares to decline.
Post issue, 55.27% of the equity share capital held by the promoter group will be subject to lock
in till 24.11.2007. Sales or distribution of substantial amounts of the equity shares by existing
holders, or the perception that such sale or distribution could occur, could adversely affect
prevailing market prices for the Equity Shares.
EXTERNAL RISK FACTORS
(a) Downturns or disruptions in the securities and commodities markets could reduce
transaction volumes, and could cause a decline in the business & impact our profitability.
A significant portion of our revenues is derived from capital markets. Like other financial
services firms, our Company and our subsidiary are also affected directly by national and
global economic and political conditions, broad trends in business and finance, disruptions to
the securities markets and changes in volume and price levels of securities and futures
transactions.
(b) Changes in regulations and policies of the Government which can materially affect or
likely to affect income from continuing operations
The role of the central and state governments in the Indian economy affecting producers,
consumers and regulators has remained significant over the years. The Government of India
has pursued policies of economic liberalization, including relaxing restrictions on the private
sector. The current Government of India has announced policies and taken initiatives those
support the continued economic liberalization and globalisation that were pursued by the
previous governments.
There is no absolute assurance that these liberalization policies will continue in future. Protests
against privatisation could slow down the pace of liberalization and de-regulation. The rate of
economic growth could change accordingly and specific laws and policies affecting technology
companies, foreign investment, currency exchange rates and other matters affecting investment
in the securities could change as well. A significant change in India’s economic liberalization
and deregulation policies could disrupt the economic business environment in India.
Statutory taxes and other levies, as may be charged by the government and other statutory
authorities, from time to time, may affect the margins in the event of the Company’s inability to
9
pass on such expense to its customers, due to stiff competition. Any increase in any of these
taxes or levies or the imposition of new taxes and levies in future, may have a material adverse
impact on Company’s business, results of operations and financial condition.
(c) Competition
Our Company and our subsidiary face significant competition from other stock broking
companies having wide presence and a strong brand name.
Management Perception:
Our Company and our subsidiary have competed successfully in the past and intend to
continue competing vigorously to capture a larger market share and recruiting additional
management personnel to manage our growth in an optimal way.
(d) The prices of our Company’s equity shares may be volatile
The price of our Company’s equity shares on Indian stock exchanges may fluctuate after this
Issue as a result of several factors, including:
− Volatility in the Indian and global securities market
− The results of operations and performance;
− Performance of the Indian Economy;
− Perceptions about our Company’s future performance or the performance of
Indian financial services companies
− Performance of our Company’s competitors in the Indian financial services and
market perception of investments in the Indian financial services sector
− Significant development in the regulation of financial services market
− Adverse media reports on our Company or on the Indian financial services
industry
− Significant development in India’s economic liberalization and deregulation
policies
There can be no assurance that prices at which our Company’s equity shares are offered will
correspond to the prices at which our Company’s equity shares will trade in the market
subsequent to this Issue. Our Company’s share price could be volatile and may also decline.
10
Apollo Sindhoori Capital Investments Ltd.
(Incorporated on 4.7.1995 under the Companies Act, 1956)
Registered & Head Office: Ali Towers – M Floor, 55, Greams Road, Chennai – 600 006.
Tel.: (044) 39190002 / 03, Fax: (044) 28290835
E-mail: geethas@ascilonline.com; Website: www.apollosindhoori.com
Dear Shareholder(s),
Your Board of Directors are pleased to make an offer of 5,54,000 Equity Shares of Rs. 10/- each
for cash at a premium of Rs. 90/- per share (i.e. at a price of Rs. 100/- per share) aggregating
Rs. 55.4 Million to the shareholders of the company on Rights basis in the ratio of One (1)
equity shares of Rs. 10/- each for every five (5) equity shares of Rs. 10/- each held on the
Record date (i.e. ____ , 2006)
GENERAL INFORMATION
Name and Address of the Company
Apollo Sindhoori Capital Investments Ltd.
(Incorporated on 4.7.1995 under the Companies Act, 1956)
Registered & Head Office: Ali Towers – M Floor, 55, Greams Road, Chennai – 600 006.
Tel.: (044) 3919 0002 /03, Fax: (044) 28290835
E-mail:geethas@ascilonline.com; Website: www.apollosindhoori.com
IMPORTANT
1.
The present Rights Issue is pursuant to the resolutions passed by the Board at its meeting
held on July 18, 2005. The resolution for the rights issue was passed by the shareholders at
the Annual General Meeting on 9th September 2005.
2.
This offer is applicable only to those equity shareholders of the Company whose names
appear as beneficial owners as per the list to be furnished by the depositories in respect of
the shares held in the electronic form and on the Register of Members of the Company in
respect of shares held in physical form as on Record date i.e. ______, 2006.
3.
Please read this Letter of Offer (LoF) carefully. The instructions contained in the
accompanying Composite Application Form (CAF) are an integral part of the conditions of
this LoF and must be carefully followed; otherwise the application is liable to be rejected.
4.
All inquiries in connection with this LoF or the accompanying CAF and requests for split
forms must be addressed (quoting the Registered Folio Number, DP ID and Beneficiary ID,
the CAF Number and the name of the first shareholder as mentioned on the CAF and
superscribed “Apollo Sindhoori Capital Investments Ltd. – Rights Issue” on the envelope)
to the Registrar to the Issue at the following address: Subramanian Building, No.1, Club
House Road, Chennai – 600 002, Tel: (044) 28460390, Fax: (044) 28460129, Email:
cameo@cameoindia.com.
5.
In case the original CAF is not received, or is misplaced by the applicant, the Registrars will
issue a duplicate CAF on the request of the applicant who should furnish the Registered
Folio Number/ DP ID and Beneficiary ID and his/her full name and address to the
Registrars to the Issue. Please note that those who are making the application in the
duplicate form should not utilise the standard CAF for any purpose including
11
renunciation, even if it is received subsequently. If the applicant violates any of these
requirements, he/she shall face the risk of rejection of both the applications.
6.
It is to be specifically noted that the issue of equity shares is subject to Risk Factors
appearing on page no. 4 of this LoF.
7.
The Rights Issue will not be kept open for more than 30 days unless extended, in which
case it will be kept open for a maximum of 60 days.
ELIGIBILITY FOR THE ISSUE
ASCIL is an existing listed company whose equity shares are listed on MSE. The company is
eligible to offer this Rights Issue in terms of clause 2.4.1 (iv) of the SEBI guidelines.
DISCLAIMER CLAUSE
IT IS TO BE DISTINCTLY UNDERSTOOD THAT THE SUBMISSION OF THE LETTER
OF OFFER 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
THE PROJECT FOR WHICH THE ISSUE IS PROPOSED TO BE MADE OR FOR THE
CORRECTNESS OF STATEMENTS MADE OR OPINIONS EXPRESSED IN THE LETTER
OF OFFER. SBI CAPITAL MARKETS LTD., THE LEAD MANAGER TO THE ISSUE, HAS
CERTIFIED THAT THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE
GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH SEBI GUIDELINES FOR
DISCLOSURE AND INVESTOR PROTECTION IN FORCE FOR THE TIME BEING. THIS
REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION
FOR MAKING INVESTMENT IN THE PROPOSED ISSUE.
IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER IS
PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE
OF ALL RELEVANT INFORMATION IN THE LETTER OF OFFER, 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, SBI CAPITAL MARKETS LTD. HAS
FURNISHED TO SEBI A DUE DILIGENCE CERTIFICATE DATED 18.1.2006, IN
ACCORDANCE WITH SEBI (MERCHANT BANKERS) REGULATIONS 1992, WHICH
READS AS FOLLOWS:
1.
WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING
TO LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTE
WITH COLLABORATORS, ETC., AND OTHER MATERIALS IN CONNECTION
WITH THE FINALISATION OF THE DRAFT LETTER OF OFFER PERTAINING TO
THE SAID ISSUE;
2.
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 ISSUE, PRICE JUSTIFICATION AND THE CONTENTS OF THE
DOCUMENTS MENTIONED IN THE ANNEXURE AND OTHER PAPERS
FURNISHED BY THE COMPANY.
WE CONFIRM THAT
(A)
THE DRAFT LETTER OF OFFER FORWARDED TO SEBI IS IN CONFORMITY
WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE
ISSUE
(B)
ALL THE LEGAL REQUIREMENTS CONNECTED WITH THE SAID ISSUE 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
12
(C)
3.
THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE TRUE, FAIR
AND ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED
DECISION AS TO THE INVESTMENT IN THE PROPOSED ISSUE.
WE CONFIRM THAT BESIDE OURSELVES, ALL THE INTERMEDIARIES NAMED
IN THE LETTER OF OFFER ARE REGISTERED WITH SEBI AND THAT TILL DATE
SUCH REGISTRATION IS VALID;
THE FILING OF THE LETTER OF OFFER WITH SEBI DOES NOT, HOWEVER, ABSOLVE
THE COMPANY FROM ANY LIABILITIES UNDER SECTION 63 OR 68 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 THE LETTER OF OFFER.
All information shall be made available by the Lead Managers and the Company to the public
and investors at large and no selective or additional information would be available for a
section of the investors in any manner whatsoever.
The Company, its directors or any of the associates or group companies, companies with which
the directors of the company are associated as directors or promoters and the directors or
person(s) in control of the promoting companies have not been prohibited from accessing the
capital market under any order or direction passed by SEBI.
DISCLAIMER CLAUSE OF THE MADRAS STOCK EXCHANGE
The company has made an application vide _____ dated _______ to The Madras Stock
Exchange, seeking its in-principle listing approval for the equity shares offered through this
LoF
MSE has given vide its letter dated 7.10.2005, permission to the Issuer to use the name of the
Exchange in this offer document as one of the Stock Exchanges on which the Issuer’s securities
are proposed to be listed. The Exchange has scrutinized this offer document for its limited
purpose of deciding on the matter of granting the aforesaid permission to the company. The
Exchange does not in any manner –
1.
2.
3.
Warrant, certify or endorse the corrections of any of the contents of this offer document or
Warrant that this company’s securities will be listed or will continue to be listed on the
Exchange or
Take any responsibility for the financial or other soundness of this company, its
management or any other scheme or project of this company;
And it should not be for any reason be deemed or construed that this offer document has been
cleared or approved by the Exchange. Every person who desires to apply for or otherwise
acquires any securities of this Company may do so pursuant to independent inquiry,
investigation and analysis and shall not have any claim against the Exchange whatsoever, by
reason of any loss which may be suffered by such person consequent to or in connection with
such subscription / acquisition whether by reason of anything stated in the offer document or
for any other reason whatsoever.
DISCLAIMER IN RESPECT OF JURISDICTION
This Letter of Offer has been prepared under the provisions of Indian Laws and the applicable
rules and regulations there under. Any disputes arising out of this issue will be subject to the
jurisdiction of the appropriate Court(s) in Chennai, State of Tamil Nadu, India only.
This offer of equity shares is made in India to persons resident in India and NRIs and FIIs
subject to requisite approvals. This Letter of Offer does not, however, constitute an offer to sell
or an invitation to subscribe to equity shares offered hereby in any other jurisdiction to any
person to whom it is unlawful to make an offer or invitation in such jurisdiction. Any person
13
into whose possession this Letter of Offer comes is required to inform himself/herself about
and to observe any such restrictions.
GENERAL DISCLAIMER
The Issuer accepts no responsibility for the statements made otherwise than in the Letter of
Offer or in the advertisements or any other material issued by or at the instance of the Issuer
and that anyone placing reliance on any other source of information would be doing so at
his/her own risk.
AUTHORITY FOR THE PRESENT ISSUE
This offer of equity shares is made pursuant to the resolutions passed by the Board of Directors
on July 18, 2005 in the ratio of 1 equity share of Rs. 10/- per share for every 5 shares held on the
Record date (i.e. ______ , 2006) at a premium of Rs. 90/- per share.
GOVERNMENT/RBI APPROVALS
FILING
The draft LoF has been filed with Securities and Exchange Board of India (SEBI), Regional
Head Office – Southern Region, Chennai for its observations and SEBI has given its
observations. The final LoF will be filed with the Madras Stock Exchange (Designated Stock
Exchange) and The Stock Exchange, Mumbai.
LISTING
The Equity Shares of the Company are listed on Madras Stock Exchange (“Designated Stock
Exchange”), and traded on The Stock Exchange, Mumbai (BSE) (IndoNext segment). The
Equity shares to be issued through this issue would also be listed on the MSE and traded on
BSE IndoNext as mentioned above. We have made application for in-principle approval for
listing to MSE. We will make application to MSE for permission to deal in and for an official
quotation in respect of the Equity Shares arising out of the Issue. The details of all in-principle
approval obtained from MSE shall be furnished at the time of filing the final Letter of Offer. We
have made an application-dated ______ to MSE.
If the permission to deal in and for an official quotation of the securities is not granted by the
Designated Stock Exchange mentioned above, within six weeks from the Issue Closing Date,
the company shall forthwith repay, without interest, all monies received from the applicants in
pursuance of this Letter of Offer. If such money is not repaid within eight days after the
company becomes liable to repay it, then the company and every Director of the company who
is an officer in default shall, on and from expiry of eight days, be jointly and severally liable to
repay the money, with interest, as prescribed under Section 73 of the Act.
IMPERSONATION
As a matter of abundant caution, attention of the applicants is specifically drawn to the
provisions of sub-section (1) of Section 68 A of the Act, which is reproduced below:
"Any person who
(a) makes in a fictitious name an application to a company for acquiring or subscribing for any
shares thereon; or
(b) otherwise induces a company to allot or register any transfer of shares therein to him or
any other person in a fictitious name,
shall be punishable with imprisonment for a term which may extend to five years."
MINIMUM SUBSCRIPTION
If the company does not receive the minimum subscription of 90% of the issue, the entire
subscription shall be refunded to the applicants within 42 days from the date of closure of the
14
issue. If there is delay in the refund of subscription by more than 8 days after the Company
becomes liable to pay the subscription amount (i.e. forty two days after the closure of the
Issue), the Company will pay interest for the delayed period, at rates prescribed under subsections (2) and (2A) of Section 73 of the Companies Act, 1956.
UNDERWRITING ARRANGEMENT
The present Rights Issue is not underwritten.
LETTERS OF ALLOTMENT / REFUND ORDERS
The Company will issue and dispatch the Letter of Allotment/Share Certificates and/or Letter
of Regret, along with the Refund Order or credit the allotted shares to the respective
beneficiary accounts, if any, within a period of six weeks from the date of closure of the Issue. If
such monies are not repaid within eight days from the day the company becomes liable to pay,
it shall be required to pay interest on the same at a rate of 15% p.a. In accordance with the SEBI
guidelines, the company will ensure that the dispatch of Letter of Allotment/Refund Order of
value exceeding Rs.1,500 would be sent by registered post/speed post to the sole/first
applicant’s registered address and adequate funds for the purpose shall be made available to
the Registrars by the issuer. Refund Orders up to the value of Rs.1,500 would be sent under
Certificate of Posting.
Further, the company shall dispatch allotment advice, share certificate, refund order and give
benefit to the Beneficiary Account with Depository Participants and submit the listing
documents to the stock exchanges within two working days of finalization and adoption of
basis of allotment.
Such Refund Orders would be marked “Account Payee only” and would be drawn in favour of
the sole/first applicant. Adequate funds would be made available to the Registrar to the Issue
for dispatch of Letters of Allotment/share certificates/refund orders.
ISSUE PROGRAMME
The subscription list will open at the commencement of banking hours and will close at the
close of banking hours on the dates mentioned below.
ISSUE OPENS ON
LAST DATE FOR RECEIVING REQUESTS FOR SPLIT FORMS
ISSUE CLOSES ON
: _____________, 2006
: _____________, 2006
: _____________, 2006
LEAD MANAGER TO THE ISSUE
REGISTRARS TO THE ISSUE
SBI Capital Markets Ltd.
202, Maker Tower ‘E’
Cuffe Parade
Mumbai 400 005
Tel: (022) 22189166, Fax: (022) 22188332
E-mail ascil.rightsissue@sbicaps.com
Cameo Corporate Services Limited
Subramanian Building,
5th floor, No. 1 Club house road,
Chennai – 600 006.
Tel: (044) 28460390, Fax: (044) 28460129
Email : cameo@cameoindia.com
COMPANY SECRETARY
& COMPLIANCE OFFICER
Ms. Geetha Sridhar
Company Secretary
Apollo Sindhoori Capital Investments Ltd.
Registered & Head Office: Ali Towers, 55,
Greams Road, Chennai – 600 006.
Tel.: (044) 3919 0052, Fax: (044) 28290835
E-mail: geethas@ascilonline.com
Website: www.apollosindhoori.com
LEGAL ADVISORS TO THE ISSUE
M/s V. Ramakrishnan
Advocate,
9/2, First Cross Street,
Seethammal Colony, Alwarpet,
Chennai – 600 018
Tel: (044) 24351117 Fax (044) 24351966
Email: vramcomp@vsnl.com
15
AUDITORS OF THE COMPANY
R. Subramanian and Company
Chartered Accountants
#6, (Old No. 36), Krishnaswamy Avenue,
Luz, Chennai- 600 004.
Tel: (044) 24992261, Fax (044) 24991408
Email: rs_company@yahoo.com
BANKERS OF THE COMPANY
HDFC Bank
Anna Salai Branch,
ITC Centre,
Chennai – 600 002.
ICICI Bank Limited
Nungambakkam Branch
M G Road,
Chennai-600 034.
Canara Bank,
Thousand Lights Branch,
Chennai – 600 006
UTI Bank Limited
82, Radhakrishnan Salai,
Chennai-600 004.
State Bank of India
Thousand Lights Branch, 129, Greams Road,
Chennai – 600 006.
Corporation Bank Limited
CAPS Branch, 27, Whites Road,
Chennai 600 014.
BANKERS TO THE ISSUE
Canara Bank,
Thousand Lights Branch,
Chennai – 600 006
UTI Bank Limited
82, Radhakrishnan Salai,
Chennai-600 004.
Note: Investors are advised to contact the Registrar to the Issue / Compliance Officer in case
of any pre-issue / post-issue related matters such as non-receipt of Letter of Offer/
Letter of Allotment / CAF / share certificate(s) / refund orders / demat credit, etc.
CREDIT RATING
Since the present issue is of equity shares, credit rating is not required.
TRUSTEES
This being an issue of equity shares, appointment of Trustees is not required.
UNDERTAKING BY THE COMPANY
The company undertakes
a) That the complaints received in respect of the Issue shall be attended to by the company
expeditiously and satisfactorily;
b) That all steps for completion of the necessary formalities for listing and trading at all stock
exchanges where the securities are to be listed are taken within 7 working days of finalisation
of the basis of allotment.
c) That the funds required for dispatch of refund orders/allotment letters/certificates by
registered post shall be made available to the Registrar to the Issue
d) That the certificates of the securities/refund orders shall be dispatched within the specified
time.
e) That no further issue of securities shall be made till the securities offered through this Letter of
Offer are listed or till the application moneys are refunded on account of non-listing, under
subscription, etc.
16
UTILISATION OF ISSUE PROCEEDS
The Board of Directors undertake that
a) All monies received out of issue of shares to public shall be transferred to separate bank
account;
b) Details of all monies utilised out of the issue referred to in sub-item a) shall be disclosed
under an appropriate separate head in the balance-sheet of the company indicating the
purpose for which such monies had been utilised; and
c) Details of all unutilised monies out of the issue of shares, if any, referred to in sub-item (a)
shall be disclosed under an appropriate separate head in the balance-sheet of the company
indicating the form in which such unutilised monies have been invested.
The funds received against this Rights Issue will be kept in a separate bank account and the
company will not have any access to such funds unless it satisfies the Madras Stock Exchange
Limited with suitable documentary evidence that the minimum subscription of 90% of the
Issue has been received by the company.
17
CAPITAL STRUCTURE
(As on September 30, 2005 in Rs. Million)
Face Value
Issue Amount
A. Authorised capital
70,00,000 Equity Shares of Rs. 10/- each
10,00,000 Preference shares of Rs. 100/- each
B. Issued capital
27,70,000 Equity Shares of Rs. 10/- each
2,00,000 Preference Shares of Rs. 100/- each
C. Subscribed Capital
27,70,000 Equity Shares of Rs. 10/- each
2,00,000 Preference Shares of Rs. 100/- each
D. Paid up capital
27,70,000 equity shares of Rs. 10/- each
2,00,000 preference shares of Rs. 100/- each
E. Present issue
5,54,000 Equity Shares of Rs. 10/- each at a
premium of Rs. 90/- per Share
F. Paid–up capital after the issue
33,24,000 Equity Shares of Rs. 10/- each
70
100
27.7
20
27.7
20
27.7
20
27.7
20
5.54
55.4
33.24
G. Share premium account
Before the issue
0
After the issue
49.86
Notes:
1. Present Issue
The present issue of rights shares is in the ratio of one equity share of Rs. 10 each for every five
shares held on the record date i.e. _____, 2006.
2.
Share Capital history since incorporation
Date of
No. of
Face Cumulative Issue Consideration
allotment/
Shares value no. of shares price
(Rs.)
splitting
(Rs)
At Incorporation
07.08.1995
700
1,009,300
10
10
700
1,010,000
10
10
30.11.2000
03.06.2001
Total
12,60,000
5,00,000
27,70,000
10
10
22,70,000
27,70,000
10
10
Remarks/Allotment
Shares taken up by subscribers
7,000 of MOA/AOA
1,00,93,000 Allotment for cash
Allotment for rights and
1,26,00,000 private placement
50,00,000 Allotment pursuant to merger
2,77,00,000
Notes:
(i)
3.
All shares since incorporation have been allotted for cash except for 5,00,000 shares issued
to the shareholders of M/s Om Sindhoori Capital Investments Limited (OSCIL) on
account of merger.
Preference Share Capital history since incorporation
Date /period of
Allotment
28.03.2005
Remarks
Face Cumulative Issue price Consideration
no. of
(Rs.)
(Rs)
Value
shares
2,00,000 100
2,00,000
100
20,000,000
Private placement
No. of
Shares
18
4.
Shareholding of the promoters as on 30.6.2005
Name
No. Of Shares Held % Shareholding
Promoters
Prathap C Reddy
Preetha Reddy
Shobana Kamineni
PCR Investments Limited
Sangita Reddy
Sucharitha P Reddy
Suneeta Reddy
Total:
590,608
355,222
247,021
238,940
218,150
116,673
70,525
1,837,139
21.32
12.82
8.92
8.63
7.88
4.21
2.55
66.32
5.
The present Issue being a rights Issue, as per extant SEBI guidelines, the requirement of
promoters’ contribution and lock-in are not applicable.
6.
The shares held by the promoter group are locked in as per Clause 8.3.5.1 (Viii) (b) of the
SEBI Guidelines.
M/s Om Sindhoori Capital Investments Limited merged with ASCIL vide Court Order dated
12th March 2001 w.e.f 1.10.1999. The transferor company was a listed company with Madras
and Mumbai stock exchanges. Accordingly, on merger, ASCIL’s shares were listed as per
clause 8.3.5.1 of SEBI Guidelines. According to clause 8.3.5.1 of SEBI Guidelines, the promoters'
shares shall be locked in to the extent 20% of the post merger paid-up capital of the unlisted
company, for a period of 3 years from the date of listing of the shares of the unlisted company.
The balance of the entire pre-merger capital of the unlisted company shall also be locked-in
for a period of 3 years from the date of listing of the shares of the unlisted company.
The details of lock in are as follows:
Date of
allotment/
acquisition
Date when
made fully
paid up
01.08.1995
07.08.1995
03.11.2000
03.06.2001
24.10.2001
15.07.2002
Total
01.08.1995
07.08.1995
03.11.2000
03.06.2001
24.10.2001
15.07.2002
7.
Consider No of Shares Face Issue Price % of post Lock in for a
ation
value (Rs.)
issue paid period
up capital
Rs.10/per share
700 10/- 10/570300
1090647
107509
42397
25586
1837139
3 years ending
0.03 24.11.2007
20.59
-----do ----------do
-----39.37
-----do -----3.88
-----do -----1.53
-----do -----0.92
66.32
The locked in shares have not been pledged
19
8.
The shareholding pattern of the company is as follows:
Pre Issue shareholding Post Issue Shareholding
pattern
pattern
Name
Promoter Holding
Promoters
Indian Promoters
Sub-Total
Non-promoter’s Holding
Others
Private Corporate Bodies
Indian Public
Sub-Total
Total
No. Of
shares
%
No. Of shares
%
18,37,139
18,37,139
66.32
66.32
22,04,567
22,04,567
66.32
66.32
39,986
8,92,875
9,32,843
2,770,000
1.44
32.23
33.68
100.00
47,983
10,71,450
11,19,393
3,324,000
1.44
32.23
33.68
100.00
Note: The present issue of rights shares is in the ratio of one share of Rs. 10 each for every
five shares held on the record date i.e. _____, 2006. Thus, total number of shares to be
issued in the present issue is 5,54,000 shares.
9.
No options have been granted or issued under any scheme of employee stock option or
employee stock purchase scheme.
10. The Company has not revalued its assets since its inception and hence issue of shares out
of revaluation reserve does not arise.
11. The number of shareholders of the company as on 09.12.2005 is 3589.
12. The promoters and directors of the company have not undertaken/financed directly or
indirectly any transactions in the shares of the company during the last 6 months.
13. The shareholders of the company do not hold any warrants, options or convertible loans or
any debentures, which would entitle them to acquire further shares of the company.
14. The company shall not make further issue of capital till the shares of the present issue are
listed or application moneys refunded on account of the failure of the issue. The company
does not intend to alter the capital structure by way of split of the denomination of the
shares or issue of shares on a preferential basis or issue of bonus or rights or public issue
shares or any other securities within a period of 6 months from the date of opening of the
present issue.
15. There is no buy back or standby arrangement for the purchase of equity shares offered
through this Letter of Offer by the directors or promoters or lead merchant banker.
16. There are no outstanding ‘bridge loans’ or any other financial arrangements, which will be
repaid out of the proceeds of the current issue.
20
17. Top Ten shareholders
Top 10 Shareholders as on the date of Stock Exchange filing
Name of Investors
1. Prathap C Reddy
2. Preetha Reddy
3. Shobana Kamineni
4. PCR Investments Limited
5. Sangita Reddy
6. Sucharitha P Reddy
7. Subramaniyan P B
8. Kalyani V
9. Suneeta Reddy
10. Ragini Padmanabhan
No. of
Shares
5,90,608
3,55,222
2,47,021
2,38,940
2,18,150
1,16,673
90,145
71,537
70,525
25,640
%
shareholding
21.32
12.82
8.92
8.63
7.88
4.21
3.25
2.88
2.55
0.93
Top 10 shareholders 10 days prior to Stock Exchange filing
Name of Investors
1. Prathap C Reddy
2. Preetha Reddy
3. Shobana Kamineni
4. PCR Investments Limited
5. Sangita Reddy
6. Sucharitha P Reddy
7. Subramaniyan P B
8. Kalyani V
9. Suneeta Reddy
10. Ragini Padmanabhan
No. of
Shares
5,90,608
3,55,222
2,47,021
2,38,940
2,18,150
1,16,673
90,145
71,537
70,525
25,640
%
shareholding
21.32
12.82
8.92
8.63
7.88
4.21
3.25
2.88
2.55
0.93
No. Of
shares
5,90,608
3,67,815
3,55,222
2,47,021
2,00,979
2,18,150
1,16,673
85,245
70,525
22,635
%
shareholding
21.32
13.28
12.82
8.92
7.26
7.88
4.19
3.08
2.55
0.82
Top 10 shareholders 2 years prior to Stock Exchange filing
Name of Investors
1. Prathap C Reddy
2. Apollo Hospitals Enterprises Limited
3. Preetha Reddy
4. Shobana Kamineni
5. PCR Investments Limited
6. Sangita Reddy
7. Sucharitha P Reddy
8. Subramaniyan P B
9. Suneeta Reddy
10. Clara Chacko
21
PARTICULARS OF THE ISSUE
OBJECTS OF THE ISSUE
The net proceeds of the rights issue will be used to create infrastructure for our growth,
consolidate our position in the existing markets and to make in-roads to new markets. The
following table sets out our proposed expenditure expected to be incurred up to September
2007.
Proposed Utilisation of Funds raised through proposed Rights Issue
Rs. Million
Estimated Sources of Funds:
Through Rights Issue
55.4
Bank's Term Loan for Equipments
50.0
Internal Accruals
102.6
Total
208.0
Utilisation:
On Branch Expansion
300 own branches by Sept 2007 spread across the country in all major cities
168.0
Expansion at H.O on New Servers and Technology upgradation
30.0
Software on BSE Derivatives
10.0
Total
208.0
The proposed expansion would be at locations with Exchange Vsat connection and online
banking facility. This will predominantly include State Capitals and District Headquarters.
Also multiple offices are proposed at major metros to cater to the clientele.
The company has incurred an expenditure of Rs. 31.84 Million for setting up of 51 new
branches and Rs. 6.5 Million for installation of a new server at Head Office during the period
April 2005 to October 2005.
The company has already borrowed Rs. 15.93 Million from ICICI Bank for part financing the
expansion plan. ASCIL has obtained sanctions for short-term loans of Rs.29.6 Million from
Federal Bank and Rs. 15 Million from Bank of India.
The company has tied up and obtained sanctions for Rs.60.5 Million, the terms of the same are
given below:
Name of the Term Loan (Rs. Interest rate
Repayment
Security
bank
Million)
ICICI Bank
15.93 10.5%
24
Monthly Hypothecation
installments
of assets
acquired.
quarterly Hypothecation
Bank of India
15.0 2% over BPLR 6
subject
to
a installments of of assets
minimum
of Rs. 25 lacs each
with an initial
12.75% p.a
moratorium of 6
months from the
date
of
first
disbursement
quarterly Hypothecation
Federal Bank
29.6 BPLR – 3.25% 6
of
assets
subject
to
a installments
acquired
minimum
of
8.25%
with
monthly rests
Total
60.5
22
BASIS FOR ISSUE PRICE
Qualitative factors
1.
2.
3.
4.
Professionally managed company
Network of 388 offices including 66 branches spread over 21 states and 2Union Territories.
Diversified products including equity and F & O broking, mutual fund and IPO
distribution, equity research analysis and depository services
The Book Value of the company is Rs. 58.34 per share as on March 31,2005 and EPS of
Rs.22.34 per share for the year ending March 31,2005
Quantitative factors
1. Earning per Share (EPS)
Year
EPS (Rs.) Weight used
18 Months ended 31.3.03
12 Months ended 31.3.04
1.24*
16.97
1
2
12 Months ended 31.3.05
22.34
3
* Annualized EPS
Weighted Average for last three years: Rs. 17.03
2. Price Earnings Ratio (P/E Ratio) in relation to Offer price of Rs. 100/- per share
Based on the EPS of Rs. 22.34 for the financial year March 31, 2005 the P/E ratio in relation
to Offer price of Rs. 100 per share is 4.48.
On fully diluted equity base post issue P/E ratio in relation to Offer price of Rs.100 per share
is 5.37.
3. Industry P/E Ratio (based on peer group)
Highest
Lowest
Average (Industry
Composite)
194.1
18.2
97.9
(Source: Capital Market- Vol.XX/20 dated Dec 5-18, 2005 and www.capitalmarket.com)
(Peer group comprises Fortis Financial Services Ltd., Geojit financial Services, Indiabulls Financial Services Ltd.,
Joindre Capital Services Ltd.)
5.
Return on Net worth
Year
18 Months ended 31.3.03
12 Months ended 31.3.04
12 Months ended 31.3.05
* Annualized EPS
RONW (%) Weight used
4.6*
41.84
34.09
1
2
3
Weighted average for the last three years: 31.75%
5. Minimum return on post issue net worth required to maintain pre-issue EPS of Rs. 22.34 is
31.34%.
23
6. Net Asset Value (NAV) per share
As at 31.03.2005
After the Issue
Issue Price
1.
Rs. 58.34
Rs. 71.30
Rs. 100.00
Comparison of accounting ratios of company with Industry average and accounting
ratios of peer group for 2004-05:
Company
Fortis Financial Services
Geojit financial Services
Indiabulls Fin
Joindre Capital
Peer group average
Apollo Sindhoori Capital Investments Ltd.
EPS#
(Rs.)
P/E
RONW
#(%)
0.2
5.4
1.5
1.2
2.1
173.5
35.9
125.3
15.2
87.5
38.3
12.5
8.5
19.8
Price as
on
21.12.05
34.7
194.1
187.9
18.2
97.9
22.34
4.5
34.1
100*
(Source: Capital Market- Vol.XX/20 dated Dec 5-18, 2005 and ww.capitaline.com)
* P/E range is arrived by calculating P/E based on Issue price of Rs.100 per share.
# Based on FY 2004-05
Peer group average is simple average of above multiples
The Lead Managers believe that the issue price of Rs.100 per share is justified in view of the above
qualitative and quantitative parameters. The investors may also want to peruse the risk factors and
financials of the Company including important profitability and return ratios, as set out in the Auditors
Report in the Letter of Offer to have more informed view about the investment proposition.
24
TAX BENEFITS
October 18,2005
To,
The Board of Directors
Apollo Sindhoori Capital Investments Limited,
55, Greams Road,
Ali Towers,
Chennai – 600 006.
Dear Sirs,
We hereby report that the enclosed annexure states the possible tax benefits available to Apollo
Sindhoori Capital Investments Ltd. (the “company”) and its shareholders under the current tax
laws presently in force in India for inclusion in the offer documents for the proposed rights
issue by the company to the shareholders of Apollo Sindhoori Capital Investments Ltd. Several
of these benefits dependent on the company or its shareholders fulfilling the conditions
prescribed under the relevant tax laws. Hence the ability of the company or its shareholders to
derive the tax benefits is dependent upon fulfilling such conditions which based on business
imperatives the company faces in the future, the company may or may not choose to fulfill.
The benefits discussed below are not exhaustive. This statement is only intended to provide
general information to the investors and is neither designed nor intended to be a substitute for
professional tax advice. In view of the individual nature of tax consequences, the changing tax
laws, each investor is advised to consult his or her own tax consultant with respect to the
specific tax implications arising out of their participation in the issue.
We do not express any opinion or provide any assurance as to whether:
−
The company or its shareholders will continue to obtain these benefits in future, or
−
The conditions prescribed for availing the benefits have been / would be met with.
The contents of this annexure are based on information, explanations and representations
obtained from the company and on the basis of our understanding of the business activities
and operations of the company.
While all reasonable care has been taken in the preparation of this opinion, R. Subramanian
and Company accepts no responsibility for any errors or omissions therein of for any loss
sustained by any person who relies on it.
For R. Subramanian & Company
Chartered Accountants
R. Rajaram
Partner
Membership No. 25210
Place: Chennai
25
The Tax benefit report has been reproduced as under:
Tax Benefits To The Company
Under the Income-Tax Act for the Assessment Year 2006-07
There is no additional benefit arising to the Company under The Income Tax Act, 1961, by
proposed Right Offer of Equity Shares
A) Residents
1.
In accordance with section 10(34), dividend income declared, distributed or paid by the
Company (referred to in section 115-0) on or after April 1, 2003 on shares will be exempt
from tax.
2.
Shares of the Company held as capital asset for a period of more than twelve months
preceding the date of transfer will be treated as a long-term capital asset
3.
In accordance with Section 10(38), any income arising from the transfer of a long term
capital asset being an equity share through a recognized stock exchange is not includible in
the total income if the transaction is chargeable to securities transaction tax
4.
In accordance with section 112, the tax on capital gains on transfer of listed shares, where
the transaction is not chargeable to securities transaction tax, held as long term capital
assets will be the lower of:
(a) 20 per cent (plus applicable surcharge and education cess) of the capital gains as
computed after indexation of the cost.
(b) 10 per cent (plus applicable surcharge and education cess) of the capital gains as
computed without indexation.
5.
In accordance with section 35(1), the Company will be entitled to a deduction of the capital
expenditure (other than on acquisition of land) and revenue expenditure incurred on
scientific research related to the business carried on by the Company in the year in which
such expenditure is incurred.
6.
In accordance with Section 111A, capital gains arising from the transfer of a short term
asset being an equity share in a Company and such transaction is chargeable to securities
transaction tax, the tax payable on the total income shall be the aggregate of (i) the amount
of income-tax calculated on such short term capital gains at the rate of 10 per cent (plus
applicable surcharge and education cess) and (ii) the amount of income-tax payable on the
balance amount of the total income as if such balance amount were the total income.
7.
In accordance with section 54EC, long term capital gains arising on transfer of the shares of
the Company on which securities transaction tax is not payable, shall be exempt from tax if
the gains are invested in certain notified bonds within six months from the date of transfer..
If only a part of the capital gain is so invested, the exemption would be limited to the
amount of the capital gain so invested.
If the said bonds are transferred or converted into money at any time within a period of
three years from the date of acquisition, the amount of capital gains on which tax was not
charged earlier shall be deemed to be income chargeable under the head “Capital Gains” of
the year in which the bonds are transferred or converted into money.
8.
In accordance with section 54ED, capital gain arising on the transfer of a long-term capital
asset being listed securities on which securities transaction tax is not payable, shall be
26
exempt from tax provided the whole of the capital gain is invested within a period of six
months in equity shares forming part of an eligible issue of capital.
If only a part of the capital gain is so invested, the exemption would be limited to the
amount of the capital gain so invested.
If the specified equity shares are sold or otherwise transferred within a period of one year
from the date of acquisition, the amount of capital gains on which tax was not charged
earlier shall be deemed to be income chargeable under the head “Capital Gains” of the year
in which the specified equity shares are sold or transferred.
9.
In accordance with Section 54F, long term capital gains arising on the transfer of the shares
of the Company held by an individual or Hindu Undivided Family on which securities
transaction tax is not payable, shall be exempt from capital gains tax if the net
consideration is utilized, within a period of one year before, or two years after the date of
transfer, in the purchase of a new residential house or for construction of a residential
house within three years. Such benefit will not be available if the individual or Hindu
Undivided Family –
- owns more than one residential house, other than the new residential house, on the date
of transfer of the shares; or
- purchases another residential house within a period of one year after the date of transfer
of the shares; or
- constructs another residential house within a period of three years after the date of
transfer of the shares;
and
- the income from such residential house, other than the one residential house owned on
the date of transfer of the original asset, is chargeable under the head “income from
house property”.
If only a part of the net consideration is so invested, so much of the capital gains as bears to
the whole of the capital gain the same proportion as the cost of the new residential house
bears to the net consideration shall be exempt.
If the new residential house is transferred within a period of three years from the date of
purchase or construction, the amount of capital gains on which tax was not charged earlier,
shall be deemed to be income chargeable under the head “Capital Gains” of the year in
which the residential house is transferred.
10. Rebate under Section 88E:
Section 88E provides that where the total income of a person includes income chargeable
under the head “Profits and gains of business or profession” arising from purchase or sale
of an equity share in a company entered into a recognized stock exchange, i.e., from taxable
securities transactions, he shall get rebate equal to the securities transaction tax paid by him
in the course of his business. Such rebate is to be allowed from the amount of income tax
in respect of such transactions calculated by applying the average rate of income tax.
B) Non-Residents
1. In accordance with section 10(34), dividend income declared, distributed or paid by the
Company (referred to in section 115-O) on or after April 1, 2003 will be exempt from tax.
2. In accordance with section 48, capital gains arising out of transfer of capital assets being
shares in the Company, and such transaction is not chargeable to securities transaction tax,
shall be computed by converting the cost of acquisition, expenditure in connection with
such transfer and the full value of the consideration received or accruing as a result of the
transfer into the same foreign currency as was initially utilized in the purchase of the
27
shares and the capital gains computed in such foreign currency shall be reconverted into
Indian currency, such that the aforesaid manner of computation of capital gains shall be
applicable in respect of capital gains accruing / arising from every reinvestment thereafter
and sale of shares or debentures of an Indian Company including the Company.
3. In accordance with Section 112, the tax on capital gains on transfer of listed shares, where
the transaction is not chargeable to securities transaction tax, held as long term capital
assets will be at the rate of 20% (plus applicable surcharge and education cess).
4. In accordance with Section 111A capital gains arising from the transfer of a short term asset
being an equity share in a Company and such transaction is chargeable to securities
transaction tax, the tax payable on the total income shall be the aggregate of (i) the amount
of income-tax calculated on such short term capital gains at the rate of 10 per cent (plus
applicable surcharge and education cess) and (ii) the amount of income-tax payable on the
balance amount of the total income as if such balance amount were the total income.
5. In accordance with section 54EC, long-term capital gains arising on transfer of the shares of
the Company and on which securities transaction tax is not payable, the tax payable on the
capital gains shall be exempt from tax if the gains are invested in certain notified bonds
within six months from the date of transfer.
If only a part of the capital gain is so invested, the exemption would be limited to the
amount of the capital gain so invested.
If the said bonds are transferred or converted into money at any time within a period of
three years from the date of acquisition, the amount of capital gains on which tax was not
charged earlier shall be deemed to be income chargeable under the head “Capital Gains” of
the year in which the bonds are transferred or converted into money.
6. In accordance with section 54ED, capital gain arising on the transfer of a long-term capital
asset being a listed security and on which securities transaction tax is not payable, is
exempt from tax provided the whole of the capital gain is invested within a period of six
months in equity shares forming part of an eligible issue of capital.
If only a part of the capital gain is so invested, the exemption would be limited to the
amount of the capital gain so invested.
If the specified equity shares are sold or otherwise transferred within a period of one year
from the date of acquisition, the amount of capital gains on which tax was not charged
earlier shall be deemed to be income chargeable under the head “Capital Gains” of the year
in which the specified equity shares are transferred.
7. In accordance with section 54F, long-term capital gains arising on the transfer of the shares
of the Company held by an individual or Hindu Undivided Family, and on which
securities transaction tax is not payable, shall be exempt from capital gains tax if the net
consideration is utilized, within a period of one year before, or two years after the date of
transfer, in the purchase of a new residential house, or for construction of a residential
house within three years. Such benefit will not be available if the individual or Hindu
Undivided Family –
a.
owns more than one residential house, other than the new residential house, on the
date of transfer of the shares; or/
b. purchases another residential house within a period of one year after the date of
transfer of the shares; or
28
c.
constructs another residential house within a period of three years after the date of
transfer of the shares; and
d. the income from such residential house, other than the one residential house owned on
the date of transfer of the original asset, is chargeable under the head “income from
house property”.
If only a part of the net consideration is so invested, so much of the capital gains as bears to
the whole of the capital gain the same proportion as the cost of the new residential house
bears to the net consideration shall be exempt.
If the new residential house is transferred within a period of three years from the date of
purchase or construction, the amount of capital gains on which tax was not charged earlier,
shall be deemed to be income chargeable under the head “Capital Gains” of the year in
which the residential house is transferred.
Further, a Non-Resident Indian has the option to be governed by the provisions of Chapter
XII-A of the Income-tax Act, according to which :
8. In accordance with section 115E, income from long-term capital gains on transfer of shares
of the Company acquired out of convertible foreign exchange, and on which securities
transaction tax is not payable, shall be taxed at the rate of 10% (plus applicable surcharge
and education cess.
9. In accordance with section 115F, subject to the conditions and to the extent specified
therein, long-term capital gains arising from transfer of shares of the Company acquired
out of convertible foreign exchange, and on which securities transaction tax is not payable,
shall be exempt from capital gains tax if the net consideration is invested within six months
of the date of transfer in any specified asset.
10. In accordance with section 115G, it is not necessary for a Non-Resident Indian to file a
return of income under section 139(1), if his total income consists only of investment
income earned on shares of the Company acquired out of convertible foreign exchange or
long-term capital gains earned on transfer of shares of the Company acquired out of
convertible foreign exchange, and the tax has been deducted at source from such income
under the provisions of Chapter XVII-B of the Income-tax Act.
11. In accordance with section 115-I, where a Non-Resident Indian opts not to be governed by
the provisions of Chapter XII-A for any assessment year, his total income for that
assessment year (including income arising from investment in the Company) will be
computed and tax will be charged according to the other provisions of the Income-tax Act.
C) Foreign Institutional Investors (FIIs)
1.
In accordance with section 10(34), dividend income declared, distributed or paid by the
Company (referred to in section 115-O) on or after April 1, 2003 will be exempt from tax in
the hands of Foreign Institutional Investors (FIIs).
2.
In accordance with section 115AD, FIIs will be taxed at 10% (plus applicable surcharge and
education cess) on long-term capital gains, if securities transaction tax is not payable on the
transfer of the shares, and at 10% (plus applicable surcharge and education cess) on shortterm capital gains arising on the sale of the shares of the Company which is subject to
securities transaction tax.
29
D) Persons carrying on business or profession in shares and securities.
In accordance with Section 88E where the total income includes income chargeable under the
head “profits and gains of business or profession” arising from taxable securities transactions,
an amount equal to the securities transaction tax paid will be available as deduction from the
amount of income-tax on such income arising from such transactions subject to the other
applicable conditions.
E) Persons carrying on business or profession in shares and securities.
In accordance with section 10(23D), any income of :
(i)
a Mutual Fund registered under the Securities and Exchange Board of India Act 1992 or
regulations made thereunder ;
such other Mutual Fund set up by a public sector bank or a public financial institution or
authorized by the Reserve Bank of India subject to such conditions as the Central
Government may, by notification in the Official Gazette, specify in this behalf will be
exempt from income-tax.
(ii)
F) Under the Wealth Tax and Gift Tax Acts
1.
2.
3.
‘Asset’ as defined under section 2(ea) of the Wealth-tax Act, 1957 does not include shares in
companies and hence, these are not liable to wealth-tax.
Gift tax is not leviable in respect of any gifts made on or after October 1, 1998. Therefore,
any gift of shares will not attract gift-tax.
In accordance with section 10(34), dividend income (referred to in section 115-0) declared,
distributed or paid on or after April 1, 2003 on shares held by the Company will be exempt
from tax.
30
INDUSTRY OVERVIEW
SECURITIES MARKETS
Capital formation is an important ingredient for economic development of any country. An
efficient securities market provides the necessary channel for flow of resources from the
providers of capital to the users of capital for economic development. Domestic savings and
capital inflows (domestic and foreign) are channelised in the securities markets. The flow of
resources in the securities market depends on the depth and efficiency of the markets, robust
risk management system, attractiveness of securities and the ability of the users of capital to
attract resources. In a post reform period in India, capital formation through securities market
has become an important tool for achieving economic growth. The overall growth of the
economy and economic activity are also important factors, which determine availability of
resources.
Key participants in the Securities Market
The securities market essentially has four types of participants viz.
• Issuer of Securities
• Investors
• Financial Intermediaries; and
• Regulators
The Issuers and Investors are the consumers of services rendered by the intermediaries and the
investors are consumers (they subscribe for / and trade in securities) of securities issued by the
Issuer as well. Those who deal in securities need an assurance that it is safe to do so and this
reassurance is provided by the laws framed in relation to the securities markets, which in turn
are enforced by the regulator. The regulator exercises control over the market and market
practices through rules, regulations and guidelines for market participants and intermediaries.
Intermediaries play an important role in the securities market by providing a critical link
between the various market participants. The efficiency of the market is often determined by
the level of intermediation and efficacy of the regulatory framework.
Segments of Securities Market
The securities market comprises of two broad segments
a. Primary markets
a. Secondary markets
Primary markets create a flow of new securities to the securities market. This is achieved
through public offerings of debt or equity or a composite structure of debt and equity to the
investors. Here the issuer of securities raises the funds to meet its fund requirements. Primary
market offerings could either be in the form of public offerings or private placements. The
issuers here could include corporates, Government, municipal corporations and in some cases
existing shareholders and institutional investors offering their securities for sale.
Secondary markets provide a medium of exchange and enable investors to trade in the
securities. An efficient securities market distinguishes financial investments from various forms
of other illiquid investments. Stock Exchanges provide the platform and the mechanism for
effecting transactions between different market participants. Secondary market comprises of
trading in equities, bonds and derivatives. The depth of the market is determined by number of
factors such as liquidity of the instruments traded, number of market participants, types of
instruments traded, settlement practices etc. There are 23 exchanges in the country, which offer
screen based trading system.
31
Post the economic liberalisation in 1991 the Indian financial services industry has experienced
significant growth. During the last decade, there has been a considerable broadening and
deepening of the Indian financial markets. The Indian markets have witnessed introduction of
newer financial instruments and products over the years. Existing sectors have been opened to
new private players. This has given a strong impetus to the development and modernization of
the financial services sector. The entry of new players has resulted in a more sophisticated
range of financial services being offered to corporate and retail customers which has compelled
the existing players to upgrade their product offerings and distribution channels. This is
particularly evident in the non banking financial services sector, such as brokerage industry,
where innovative products combined with new delivery methods have helped the sector
achieve high growth rates.
The financial services marketplace is experiencing a profound change as thirty million people
in the middle class are entering their prime saving and investing years. These people are
willing to use advanced communication tools, such as computers and telephones, and want to
take charge of their personal investment decisions.
Indian Capital Market
The Indian capital markets have witnessed a transformation over the last decade. India now
finds its place amongst some of the most sophisticated and largest markets of the world. With
over 20 million shareholders, India has the third largest investor base in the world after the
USA and Japan. Over 9,000 companies are listed on Indian stock exchanges. The Indian capital
market is significant in terms of the degree of development, volume of trading and its
tremendous growth potential. Over the past few years, the capital markets have also witnessed
substantial reforms in regulation and supervision. Reforms, particularly the establishment and
empowerment of SEBI, market-determined prices and allocation of resources, screen-based
nation-wide trading, dematerialization and electronic transfer of securities, rolling settlement
and derivatives trading have greatly improved both the regulatory framework and efficiency of
trading and settlement.
With the development of the Indian capital markets, the Indian financial sector presents a huge
retail finance opportunity. Existing low penetration levels, increasing affordability of credit and
rising income levels have led to a growing demand for retail financial products. India has a
large pool of retail investor base spread throughout the country with a huge pool of untapped
surplus funds. The confidence of small investors has increased with the growing levels of
education and financial awareness, and the tightening of regulatory systems. Exposure to
global practices has made the Indian customer more discerning and demanding. As a result of
falling interest rates, bank deposits, other traditional investment opportunities are losing their
attraction. Thus, Indian investors are getting attracted towards alternate investments such as
the equity markets and are looking for newer financial products.
Huge opportunities offered in the retail financial services sector are coupled with several
challenges. The sector requires extremely effective distribution systems that are capable of
offering flexibility and convenience to the customer, while maintaining cost-efficiency. There
has been a clear shift towards those entities that are able to offer products and services in the
most innovative and cost efficient manner. The financial sector will need to adopt a customercentric business focus. It will also have to create value for its shareholders as well as its
customers, competing for the capital necessary to fund growth as well as for customer market
share. The financial services industry is undergoing a consolidation with the large number of
small players turning into few large players. In future, it is expected that the market share will
be captured by the players who can offer a complete bouquet of financial products and
services.
Consolidation in the Indian Equity Trading Markets
As the Indian capital markets are evolving, they are undergoing rapid consolidation spurred
primarily due to continuous increase in capital requirements, increased regulatory oversight,
customer sophistication, availability of technology to provide high quality service to a large
customer base and increased back-office requirements. The margin requirements for exposure
32
and mark to market have increased as the regulator and major exchanges enhance the risk
management processes and systems in order to be in line with global practices. Moreover the
shorter settlement cycle has required stronger back office capabilities thus necessitating heavy
capital investments. From T+5 settlement regime till 2000, markets are now in T+2 regime.
These changes in regulatory framework have enhanced the capabilities required to stay in the
business in terms of capital and infrastructure and have resulted in the smaller players getting
driven out of the system. These companies’ strengths lie in their strong balance sheets,
countrywide presence, strong brand awareness and highly trained sales force delivering worldclass service levels to the retail investor.
The retail presence in the stock markets has been growing steadily with the advent of
dematerialization and the recent acceleration in opening of demat accounts. Over the past few
years, there has been an increase in the consolidation within the broking industry. The market
share of the top 5 brokers on NSE has increased from less than 5.9 % in 1996-97 to about 16% in
the September 2005 The market share of the top 10 players on NSE has grown from 10% in
1996-97 to 23% in September 2005, and the share of the top 25 players on NSE has grown from
19.7% in 1996-97 to 38% in September 2005. (See Table Below) These figures indicate a longterm consolidation process in the highly fragmented securities brokerage industry, with
hundreds of smaller players exiting the business and the larger brokers gaining larger market
shares.
This development parallels, on an accelerated timeline, the development of the US markets
from 1970s to 1990s, where the top 5 brokers, like Charles Schwab, Etrade, Merrill Lynch, Dean
Witter, and Smith Barney rapidly expanded their market share and gained control of close to
50% of retail trading volumes.
Major reforms/changes in the securities market since 1990
1) SEBI Act, 1992 replacing Capital Issues (Control) Act, 1947:
As a part of liberalization process, Capital Issues (Control) Act, 1947 was repealed in 1992
paving a way for (SEBI Act, 1992) market-determined allocation of resources. Under the new
Act, issuers complying with eligibility criteria were allowed freedom to issue securities at
market-determined rates. SEBI exercises control over the market through issuance of
guidelines and rules for various capital market activities and through regulations for
intermediaries and stock exchanges.
2) Screen Based Trading:
The trading on stock exchanges in India used to take place through open outcry without use
of information technology for immediate matching or recording of trades. In order to provide
efficiency, liquidity and transparency, NSE introduced a nation-wide on-line fully automated
screen based trading system (NEAT). The Stock Exchange, Mumbai has also introduced
nation-wide screen based trading system (BOLT). Introduction of these trading systems is
one of the key developments, which has transformed Indian capital markets in different
league.
3) Trading Cycle:
The trades were accumulated over a trading cycle and at the end of the cycle, these were
clubbed together, and positions were netted out and payment of cash and delivery of
securities settled the balance. This trading cycle varied from 14 days for specified securities to
30 days for others and settlement took another fortnight. Often this cycle was not adhered to.
There were several occasions of defaults and risks in settlement. In order to reduce large
open positions, the trading cycle was reduced over a period of time to a week. The
exchanges, however, continued to have different weekly trading cycles, which enabled
shifting of positions from one exchange to another. Rolling settlement on T+5 basis was
introduced in respect of specified scrips reducing the trading cycle to one day. It was made
mandatory for all exchanges to follow a uniform weekly trading cycle in respect of scrips not
under rolling settlement. All scrips moved to rolling settlement from December 2001. The
33
settlement period has been reduced progressively from T+5 to T+3 days. Currently T+2 day
settlement cycle is being followed.
5) Derivatives Trading:
To assist market participants to manage risks better through hedging, speculation and
arbitrage, SCRA was amended in 1995 to lift the three-decade-old ban on options in
securities. The SCRA was amended further in December 1999 to expand the definition of
securities to include derivatives so that the whole regulatory framework governing trading of
securities could apply to trading of derivatives also. In the meanwhile exchanges developed
adequate infrastructure and the information systems required to implement trading
discipline in derivative instruments. Derivative trading took off in June 2000 on NSE and BSE
only. The market presently offers index futures and index options on three indices and stock
options and stock futures on individual stocks (presently 117 stocks on NSE) and futures in
interest rate products like notional 91-day T-bills and notional 10-year bonds.
6) Demutualisation (Segregation of ownership from management):
Historically, brokers owned, controlled and managed stock exchanges. Government
proposed in March 2001 to corporatise the stock exchanges by which ownership,
management and trading membership would be segregated from one another. Few
exchanges have already initiated demutualisation process. Government has offered a variety
of tax incentives to facilitate corporatisation and demutualisation of stock exchanges. NSE
adopted a demutualised governance structure where ownership, management and trading
are with three different sets of people. This completely eliminates any conflict of interest and
helped it to aggressively pursue policies.
7) Investors Protection:
The SEBI Act established SEBI with the primary objective of protecting the interests of
investors in securities and empowers it to achieve this objective. SEBI specifies that the
critical data should be disclosed in the specified formats regarding all the concerned market
participants. The Central Government has established a fund called Investor Education and
Protection Fund (IEPF) in October 2001 for the promotion of awareness amongst investors
and protection of the interest of investors. Department of Economic Affairs (DEA),
Department of Company Affairs (DCA), the SEBI and the stock exchanges have set up
investor grievance cells for redressal of investor grievance. The exchanges maintain investor
protection funds to take care of investor claims.
8) Depositories Act:
Settlement system on Indian stock exchanges gave rise to settlement risk due to the time that
elapsed before trades were settled. Trades were settled by physical movement of paper. The
process of physically moving the securities among different parties involved, took time with
the risk of delay somewhere along the chain. Significant proportion of transactions ended up
as bad delivery due to faulty compliance of paperwork. This added to costs, and delays in
settlement, restricted liquidity and made investor grievance redressal time consuming and at
times intractable. To obviate these problems, the Depositories Act, 1996 was passed. At the
end of March 2004, number of companies connected to NSDL and CDSL were 5,212 and 4,720
respectively. The number of demat securities increased to 97.7 billion at the end of March
2004 from 76.9 billion as of end March 2003. As on the same date, the value of dematerialsied
securities was Rs. 10,701 billion and the number of investor accounts was 5,832,552. All
actively traded scrips are held, traded and settled in demat form. Demat settlement accounts
accounted for over 99% of turnover settled by delivery. This has almost eliminated the bad
deliveries and associated problems. To prevent physical certificates from coming into
circulation, it has been made mandatory for all new IPOs to be compulsorily traded in
dematerialised form. The admission to a depository for dematerialisation of securities has
been made a pre-requisite for making a public or rights issue or an offer for sale.
34
9) Globalization:
Indian securities market is getting increasingly integrated with the rest of the world. Indian
companies have been permitted to raise resources from abroad through issue of ADRs,
GDRs, FCCBs and ECBs. ADRs/GDRs have two-way fungibility. The two-way fungibility for
ADRs/GDRs has been permitted by RBI, which meant that the investors (foreign
institutional or domestic) in any company that has issued ADRs/ GDRs can freely convert
the ADRs/GDRs into underlying domestic shares. They could also reconvert the domestic
shares into ADRs/GDRs, depending on the direction of price change in the stock. This is
expected to bring about an improvement in the liquidity in ADR/GDR market and
elimination of arbitrage opportunity. This will better align ADR/GDR prices and domestic
share prices of companies that have floated ADRs/GDRs.
10. Emergence of Commodity Exchanges
India is predominantly an agrarian economy. In spite of this, until very recently we did not
have world-class multi commodity exchanges. The existing exchanges were all single
commodity exchanges where trading was conducted using the “open-outcry” system.
Realising the potential, the government issued notifications for withdrawing all prohibitions
and opening up forward trading in all the commodities. The emergence of three nation-wide
commodity exchanges (MCX, NCDEX and NMCE) has increased the awareness in
commodities trading. The volume in these exchanges has increased rapidly since their
inception. Some of the commodities where trading takes place is Gold, Silver, Copper, Castor
Seed, Gram (Chana), Soya Oil, Sugar, Rubber etc.
35
BUSINESS
OVERVIEW
We are a professionally managed Financial Service organization, belonging to the Apollo
Hospitals Group. We have a corporate membership of National Stock Exchange of India
Limited [NSE] and The Bombay Stock Exchange Limited [BSE]. We are registered as
Depository Participant with both NSDL and CDSL. Our subsidiary Apollo Sindhoori
Commodities Trading Limited has been granted membership of NCDEX and MCX.
We offer the following services:
− Trading facility in Equity segment on NSE & BSE and Derivative segment on NSE through
a single screen. All the branches are connected by VSat to a central server at Chennai and
orders are placed through the CTCL.
− Trading facility in commodity segment, including bullion, oils, gaur seed etc. through our
subsidiary, Apollo Sindhoori Commodities Trading Limited
− Depository Participant [DP] services of NSDL and CDSL at major locations
− Online bidding for IPO
− Distribution of Mutual Funds
We have experienced growth at a CAGR of 97.8% over the 18 months ended 31.3.2003 to FY
2005 (12 months ended 31.3.2005) in revenues and achieved a market share in the Equity and
F&O market leading to a combined average daily turnover of Rs. 250,000 million for FY 2005.
Our net profits have increased from Rs.5.14 million in the 18 months ended 31.3.2003 to Rs. 47
million in FY 2004 and to Rs. 61.91 million in FY 2005. Total number of employees grew from
155 as on 31.3.2003 to 202 as on 31.3.2004 to 598 as on 30.10.2005.
Our client base has increased from 7,207 as on 31.3.2003 to 21,005 as on 31.3.2004 and to 50,000
as on 31.3.2005. Network, including owned branches and franchisees, has risen from 237 to 343
during the year-ended 31.3.2005 and to 388 as on 30.9.2005. Number of owned branches has
grown from 14 as on 31.3.2003 to 17 as on 31.3.2004 and to 50 as on 31.3.2005.
With a view to servicing customers closer to their location, the Company runs its operations
through a network of owned branches and franchisees. We have 320 franchisees as on 30.9.2005
and 69% of Income from operations in FY 2004-05 was contributed by franchisee business.
PRODUCTS & SERVICES OFFERINGS
We offer a broad range of products and service offerings through ASCIL and ASCTL to address
our clients’ varying investment and financial needs.
Brokerage Offering
Our retail equity business primarily covers secondary market equity broking. It caters to the
needs of individual Indian and Non-resident Indian (NRI) investors. We offer broker assisted
trade execution and automated online investing and trading facilities to our customers.
Online Automated Channel
Automated online investing and trading includes automated order placement and execution of
market and limit equity orders; and advanced trading platforms for active traders. All
investors have full access to real - time quotes, personalized portfolio tracking, charting and
quote applications, real-time market commentary, real-time quotes and news. While most
client transactions are completed through the online channel, we continue to stress the
importance of blending the power of the Internet with personal service to create a full-service
client interface. We offer an online portal where the clients can execute securities purchase and
sales transactions through the Internet. This covers the Equity, Debt & Derivatives segment in
the Indian securities market. With an objective of assisting our customers in taking investment
decisions, the portal also provides financial information on various companies listed. For
36
executing a transaction clients can directly log on to our website www.apollosindhoori.com
without requiring assistance from offline intermediaries.
Depository Services
We are a depository participant with the NSDL and CDSL for trading and settlement of
dematerialised shares. NSDL and CDSL perform clearing services for all securities transactions
through its accounts. Clients of the brokerage business are able to use the depository services to
execute their trade through ASCIL and settle these transactions through our depository
services. Our depository service is part of our value added offerings, aimed to create multiple
interfaces with the client.
Third Party Financial Products Offering
We distribute third party products and services through our comprehensive retail distribution
network. The products offered include third party mutual funds and initial and secondary
public offerings. We have a pan India retail distribution network, comprising 200 dealers
relationship managers and 388 offices (320 franchisees and 68 owned branches) as on 30.9.2005
spread over 21 states and 2 Union territories.
Mutual Funds:
We distribute various mutual funds (equity, debt and balanced mutual funds) through our
retail distribution network. We offer clients a wide variety of mutual funds from Asset
Management Companies like Franklin Templeton, HDFC Mutual Fund, Birla Sun Asset
Management Company Reliance Mutual Fund etc.
KEY COMPETITIVE STRENGTHS
Diverse Branch Network
Since inception, our Company has grown from a single location to a nationwide network
spread over 388 offices (320 franchisees and 68 owned branches) as on 30.9.2005 in 21 States
and 2 Union Territories as on 30.9.2005. We have a pan India distribution network for the
purpose of distribution of our financial products and services. Such a diverse and integrated
network provides a centralized platform to our clients.
•
Bouquet of financial products and services
Our Company and our subsidiary offer various financial services and products ranging from
equity, F & O, mutual fund and IPO – Online bidding, depository services to cater to the
specific needs of the retail and institutional investors thus providing all these services in a
single platform.
•
Advanced Technology team
Our ongoing investment in technology is a key element in expanding our product and service
offerings, enhancing our delivery systems, providing fast and consistent client service,
reducing processing costs, and facilitating our ability to handle significant increases in client
activity. Our Company has an in-house technology team of 25 people comprising technical
expert in each area. The in-house technology team has been responsible for efficient operations
of our back office systems.
•
•
Strong Sales and Marketing Teams:
The marketing force is divided into various teams with specific area of operation viz. corporate
clients and retail clients. The marketing team at Mumbai specializes in Institutional clients.
Specific teams also handle High Net worth Clients. This segmentation of marketing teams help
in targeting various segments at the same time.
37
Our marketing is focused towards both virgin clients, i.e., clients who are not already trading
and are not much aware of opportunities in the stock market and clients who are already in the
stock market and enrolled themselves with other stockbrokers.
Our marketing focus is mainly in the retail sector and our marketing teams propose to carry
out door-to-door canvassing and conduct road shows. During the current year we
strengthened our marketing efforts by commencing a campaign on popular TV Channels, print
media, Financial and Mass web sites. The marketing teams are also provided with varied
marketing material like brouchers, pamphlets, canopies, danglers, posters etc. Additional
products like Commodities Trading and Mutual Funds have expanded our marketing scope.
Strong Cross Selling Opportunities:
With our 388 offices (320 franchisees and 68 branches) as on 30.9.2005 spread over 21 states and
2 union territories all over India and variety of financial products and offerings we have strong
cross product selling opportunities thus providing a multi-channel delivery systems to our
diverse client base of 63939 clients as on 30.09.2005.
•
Ability to combine People & Technology in unique ways:
We provide multiple distribution channels by combining people and technology. Clients can
access any of the 388 offices or access via telephone or online channel.
•
BUSINESS STRATEGY
The business strategy adopted by the company is two pronged.
•
We propose to open new branches at both new and old locations, depending on the
business potential. For this purpose, the business potential at each location is analysed by
professional teams. Based on these reports, the top management team decides on the
locations to set up trading terminals.
•
We are also focusing on acquiring more clientele through aggressive marketing and
introduction of new products. We plan to introduce new services such as trading on BSE
Derivatives and Sensex trading. We believe that our entry into financial products
distribution has been fairly successful and expect to achieve the same results with all other
products we are planning to introduce.
LOCATIONS OF BROKING TERMINALS:
We have a presence across India with 388 offices (320 franchisees and 68 branches) in 21 states
and 2 Union territories as on 30.09.2005. The number of offices has grown from 343 to 388 from
March 2005 to September 2005.
State wise branch distribution
Sr. State
No. of offices
No
1
2
Tamil Nadu
Andhra Pradesh
92
47
3
Karnataka
47
4
5
Kerala
West Bengal
43
33
6
Uttar Pradesh
24
7
Maharashtra
22
38
Sr.
No
State
No. of offices
8 Gujarat
9 Orissa
10 Madhyapradesh
14
12
10
11 Punjab
12 Rajasthan
8
8
13 Jharkhand
7
14
15
16
17
18
6
3
3
2
2
Bihar
J&K
Delhi
Tripura
Uttaranchal
19 Chhattisgarh
1
20 Goa
Union Territory
1
1
Chandigarh (U. T)
2
2
Pondicherry (U. T)
1
Total
388
HUMAN RESOURCES
1. Growth in the number of employees over the past 5 years
Sl.No.
Year ending March 31,
1
2
3
4
5
2001
2002
2003
2004
2005
No
of
(fulltime)
180
145
155
202
289
employees
No of branches
13
13
14
17
50
As of 31.10.2005 our Company had 598 full-time employees. Our subsidiary does not have any
employees. There are no part time employees.
2.
Designation wise and qualification wise details of employees as on 31.10.2005
The Company is led by an Executive Director who reports to the Board. Under him there are 3
general managers, 2 Asst General Managers and six senior Managers. There are 27 managers
including branch managers, 49 Asst Managers including branch in charges, 170 dealers, 45
marketing executives, 100 executives and 156 trainees predominantly MBAs rest of them are
staff in the grade of assistant. Out of the total staff, 148 are professional/postgraduates and
rest of them are graduates.
39
3.
Incentive system: In addition to salary Branch Managers/Branch In charges and dealers of
the branches are entitled to performance-based incentives, disbursed on a monthly basis.
4.
Training:
Extensive In-house training programs, with induction and refresher
programmes, include training sessions at our Head office, direct training under senior
relationship managers and periodic reviews, professional training and job rotations. Our
methodology is to hire new graduates from business schools or laterals at sales positions
and train them internally.
TECHNOLOGY
The technological hub is located in the Head Office at Chennai. We have the following
Network / Systems Configuration to take care of the Computer To Computer Link Operations
(CTCL).
The CTCL interface is as given below:
Hardware
•
•
•
•
•
•
Trading/Back office Applications are run on 2 Nos of IBM P550 dual CPU of 1.65 GHz
with 8GB RAM running with AIX 5.3 OS on an IBM High Availability Clusters
Environment.
The Data and Applications are kept in IBM DS4300 Turbo SAN with No Single Point of
Failure. The connection to the Severs is through Fiber Channel Switches.
An IBM P520 Dual CPU Server is used as a Test and Development Server.
ASCIL has 2 Nos of HP Alpha ES-45 Servers with 2 CPU for other Support Operations.
The Internet Trading Application is supported through 2 Nos of Compaq ML-350-G4
Severs
Separate Server has been installed for Back Office Reports and DP Capturing
40
•
•
•
MS Exchange Server works as a Mail Server for the HO and Linux Send-Mail for the
Branches.
2 Neat Servers (1 Standby) connect the company and NSE for Corporate Actions.
2 BOLT Servers (1 Standby) connect the company and BSE for Corporate Actions.
Network
•
•
•
•
•
•
•
•
•
ASCIL has 2 Networks for its Clients
There are 3 MLLN (Connecting ASCIL Chennai and HCL-Comnet Nodia for HCLComnet VSAT Users. (2 MB MLLN from Bharati, 1MB MLLN from Reliance and 512
Kbps from BSNL) (please make this simpler to comprehend)
For Internet ASCIL has 1 MB Internet Lease Line from two different service providers.
The Backhaul Lease Lines are backed up by PAMA Vsat
The 3rd Backup of the Backhaul is through ISDN Dial Up.
ASCIL has 3 HP DS-20 Alpha servers for Testing purpose.
ASCIL has 3 VSAT Connecting to NSE and 2 VSAT Connecting to BSE for Trading
Purpose.
ASCIL has 1 Lease Line connecting to NSE and 2 Lease Lines Connecting to BSE as a
Backup for the Exchange VSATs.
Layer 3 Nortel Network Switches (2 Nos) and Layer 2 Nortel Network Switches (15
Nos) support the Internal Networks for ASCIL. A Redundant
Power Supply
•
•
•
•
•
•
Power Supply from a Secondary UPS supports layer 3 Switches.
Server Room is Equipped with 1 GB Internal Network
Redundancy is built for Backhaul with dual Cluster of CISCO ISR Routers.
ASCIL has 2 * 20 KVS UPS Power (Numeric) working in Parallel for the Servers.
A 20 KVA Frontline UPS back up this Power on a Standby mode.
ORACLE Database is used as a Back End Database Server.
Network
Our branches and Head Office are networked through V-Sat technology. All the branches are
connected to and controlled by the Head Office at Chennai, through V-Sats. A major
advantage offered by the centralized trading environment is that every aspect of business is
conducted at client level, instead of branch level. The centralized trading environment leads to
a control of the whole network and hence reduces uncertain elements in business. We are able
to control exposure limits, set margins, define brokerages and control the risks with
commendable speed and high level of accuracy. This aids us in helping the clients in
minimizing their losses and also ensure efficient risk management.
41
HISTORY
BRIEF HISTORY OF THE COMPANY
The Company was incorporated on 4.7.1995 at Chennai in Tamil Nadu. The certificate to
commence business was obtained on 16.8.1995. The company is registered with SEBI under
Section 12 of the SEBI Act, 1992 for carrying on the business of stock broking. RBI has
exempted the company from the provisions of S.45-IA of RBI Act and hence the company has
not been registered as an NBFC with RBI.
The company is committed to the best practices in corporate governance to protect the interest
of shareholders, depositors and customers.
M/s Om Sindhoori Capital Investments Limited merged with ASCIL vide Court Order dated
12th March 2001 w.e.f 1.10.1999. The transferor company was a listed company with Madras
and Mumbai stock exchanges. Accordingly, on merger, ASCIL’s shares were listed as per
clause 8.3.5.1 of SEBI Guidelines. The company sought an exemption under clause (b) to subrule (2) of Rule 19 of the Securities Contracts (Regulation) Rules, 1957 from SEBI as per the SEBI
Guidelines and as the same was refused, the company appealed to the High Court of
Judicature, Chennai, which passed an order directing the Madras Stock Exchange to list
ASCIL’s shares and the same was listed in the exchange on 15.12.2004. By virtue of our listing
in the Madras Stock Exchange, our shares were permitted to be traded with BSE under
IndoNext from 23.8.2005.
The Main Objects of the Company, as set out in its Memorandum of Association are as follows:
1.
To apply for and obtain the membership interests and trading privileges in various stock
exchanges and security exchanges and to carry on the business, profession or vocation of a
stock broker, dealer or broker or agent in foreign exchanges, securities, financial
instruments and money market instruments, underwriters, merchant banker, portfolio
manager, manager of assets, investment advisor and consultant, registrar, manager advisor
and consultant, to raise capital either through public issue or otherwise registrars and
transfer agents, market maker, fixed deposit broker, finance broker, financial consultant,
agent of national small savings schemes, agents of the unit trust of India and other mutual
funds and as any other intermediary broker or agent in the capital money and securities
markets.
2.
To carry on the business as Investment and Finance Company and to provide finance or to
make investment in any form whatsoever including investment in shares, stocks, securities,
bonds or other securities and to provide on lease or hire purchase basis or on deferred
payment basis or on any other basis all types of plant, equipment, machinery, vehicles and
real estates and any other movable and immovable properties whether in India or abroad
for industrial or other use.
3.
To undertake and to provide custodian and depository services and to carry on the
business of finance, trust, legal trust and to finance industrial enterprises and to promote,
arrange mergers, amalgamations, takeovers and reconstructions of companies engaged in
industrial and trading activities.
4.
To manage investment pools, issue of shares, stocks, securities, bonds and other negotiable
instruments and securities and to carry on business of commission agents, representatives,
brokers, factors, forex dealers, brokers, advisors, consultants, representatives, middlemen,
real estate, importers and exporters.
5.
To establish and carry on the business of merchant banking and to promote, establish,
finance or any other manner support or encourage establishment of industrial enterprises
of companies engaged in industrial and trading activities.
42
6.
To apply for and obtain membership interest, trading and clearing privileges in exchanges
and associations relating to trading in goods and commodities of all kinds, to carry on the
business of buying, selling and generally trading in goods and commodities of all kinds
(including but not limited to trading in options and futures in commodities and goods) as
broker, sub-broker, trading member or in any other capacity or in any other manner
whatsoever.
CHANGES IN MEMORANDUM AND ARTICLES OF ASSOCIATION OF THE
COMPANY SINCE INCEPTIONS
Date
7th Aug 1995
5th Aug 2000
17th July 2003
5th Feb 2005
9th Sep 2005
Change in Memorandum
Authorised capital increased from Rs. 1 crore to 1.5 crore
Authorised capital increased from Rs. 1.5 crore to 5 crore
Following Clause added to the main object.
To apply for and obtain membership interest, trading and clearing privileges
in exchanges and associations relating to trading in goods and commodities
of all kind, to carry on the business of buying, selling and generally trading
in goods and commodities of all kinds (including and not limited to trading
in options and futures in commodities and goods) as broker, trading
member or in any other capacity or in any manner whatsoever.
Authorised capital increased from Rs. 5 crore to 15 crore ((divided into
50,00,000 Equity shares of Rs. 10/- each and 10,00,000 Preference Shares of
Rs. 100/- each)
Authorised capital increased from Rs.15 crore to 17 crore
(divided into 70,00,000 Equity shares of Rs. 10/- each and 10,00,000
Preference Shares of Rs. 100/- each)
Some of the significant milestones since 1990s:
Year
Milestones / Achievements
1996
1998
2000
2001
Commenced operations at Chennai with NSE
Network increased to 4
Network augmented to 10 throughout South India
− Centralisation of operations with technology up gradation
− Membership of The Stock Exchange , Mumbai
− Depository participant of NSDL
− Merger with group company M/s Om Sindhoori Capital Investments
Limited vide Court Order dated 12th March 2001 w.e.f 1.10.1999
− Expansion of network, including owned branches and franchisees, to a
total of 50
− Granted license to trade on derivatives segment of NSE
− Network increased to 150
− Branch launched at Mumbai to cater to Institutional clientele
− Network expanded to 270
− Membership of NMCE
− Membership of NCDEX through Subsidiary Apollo Sindhoori
Commodities Trading Limited.
− Achievement of daily turnover of Rs.300 Crores
− Listed with MSE from 15.12.2004.
2002
2003
2004
43
STOCK MARKET DATA
The shares are listed in MSE and traded on MSE and BSE IndoNext. The equity shares of the
company were listed in MSE on 15.12.2004. Trading on BSE IndoNext commenced on 23.8.2005.
Movement of share prices from the date of listing is given below:
MSE
Period
15.12.04-31.3.05
1.4.05-30.9.05
April 2005
May 2005
June 2005
July 2005
August 2005
Sep- Dec 2005
(Source: MSE)
BSE IndoNext
Period
High
(Rs.)
40
150
82
105
110
120
150
High
(Rs.)
Low
Date of
Volume
Volume
(Rs.)
Low
on date of
on date
low (no.
of
of shares)
high (no.
of
shares)
31.3.05
100
40
31.3.05
100
19.8.05
50
45
4.4.05
500
29.4.05
50
45
4.4.05
500
20.5.05
250
88
2.5.05
50
14.6.05
150
110
14.6.05
150
1.7.05
250
120
1.7.05
250
19.8.05
50
140
18.8.05
150
There has been no trading during this period
Date of
High
Date of
High
Volume
on date
of
high (no.
of
shares)
Low
(Rs.)
Date of
Low
Volume
on date of
low (no.
of shares)
Average
price for
the
period
(Rs.)
40
92
60
100.6
110
120
145
Average
price for
the
period
(Rs.)
August 2005
351.2
29.8.05
70969 179.9
23.8.05
3403
282.4
September 2005 353.5
20.9.05
8256 287.1
30.9
1358
309.2
October 2005
287.2
4.10.05
3456 224.3 28.10.05
1292
258.1
November 2005 252.0
16.11.05
6310 215.4 10.11.05
2003
232.5
December 2005
241.5
15.12.05
3711 225.2 26.12.05
1778
232.6
(SOURCE: BSE WEBSITE)
There was no trading on 18.7.2005, i.e. the date of the Board Meeting approving the rights
issue. The earliest date of trading after the Board Meeting approving the rights issue was Rs.
140 on 18.8.05.
PREVIOUS PUBLIC/RIGHTS ISSUES BY THE COMPANY
ASCIL has not made any public or rights issue in the past. M/s Om Sindhoori Capital
Investments Limited merged with our company vide Court Order dated 12th March 2001 w.e.f
1.10.1999. The transferor company was a listed company with Madras and Mumbai stock
exchanges. Accordingly, on merger ASCIL became listed per clause 8.3.5.1 of SEBI Guidelines.
The company sought exemption under Section 19(2)(b) from SEBI as per the SEBI Guidelines
and as the same was refused, the company appealed to the High Court of Judicature, Chennai
which passed an order directing the Madras Stock Exchange to list ASCIL’s shares and the
same was listed in the exchange on 15.12.2004. ASCIL was not listed on BSE because it did not
fulfill the listing requirement of BSE. By virtue of our listing in the Madras Stock Exchange, our
shares were permitted to be traded with BSE under Indonext from 23.8.2005.
44
OSCIL had made a public issue of equity shares aggregating Rs. 50 Million in March 1995, the
details of which are given below:
Type of Issue
Amount of Issue
Year of Issue
Closing Date
Date of Despatch of share certificates
Date of Despatch of refund orders
Date of Listing on the Madras Stock
Exchange
Issue of equity shares
Rs.50 million
1995
25th March 1995
26th May 1995
20th May 1995
01st June 1995
Promises v/s Performance
Objects to the Issue
The projections made in the Prospectus/LoF and the actual performance are given hereunder:
(Rs. In million)
Particulars
31.03.1995
Projections
Capital
Share premium A/c
Reserves
Total net owned
funds
Net profit
Book value per share
(Rs)
Earning per share
(Rs)
31.3.1996
Projections
30
—
2.08
31.36
Actual
s
30
—
3.08
30.02
4.0
10.42
3.26
31.3.1997
Projections
50
—
5.75
53.25
Actual
s
50
-6.13
53.2
50
-21.93
69.31
Actual
s
50
-7.52
54.97
4.46
10.00
13.0
11.02
8.43
10.63
26.18
14.04
8.55
10.99
1.48
2.60
1.68
5.24
1.71
PUBLIC/RIGHTS ISSUES BY THE GROUP COMPANIES IN THE PAST THREE YEARS
GDR Issue by Apollo Hospitals Enterprise Limited
Objects of the issue:
The funds were raised to fund expansion activities, with any remaining proceeds to be applied
for working capital and general corporate purposes.
Type of Issue
Amount of Issue
Issue of equity shares
USD 70.2 million including
green shoe option
2005
25th July 2005
25th July 2005
NIL
18th/ 26th July 2005
Year of Issue
Closing Date
Date of Despatch of share certificates
Date of Despatch of refund orders
Date of Listing on the Luxembourg Stock
Exchange
Promises v/s Performance: The GDR issue concluded in the month of July 2005
45
PROMOTER & PROMOTER GROUP
The details of our promoter group are given below.
1. Ms. Suneeta Reddy
Father’s Name: Dr. Prathap C Reddy
Address: No. 6 Subba Rao Avenue, Chennai-600006
Age: 46 years
Qualification: B.A, Diploma in Financial Management and has
completed Owner/ President Management Program at Harvard
Business School
Experience: 20 years
UIN (MAPIN) No. A00296848
PAN No. AAEPR4602H
Bank Account No. 34387/SB/CANARA BANK-Chennai
Passport No. Z070966/Chennai
2. Dr. Prathap C Reddy
Father’s Name: Mr. Raghav Reddy
Address: 19, Bishop Garden, Chennai- 600 028
Age: 73 yrs
Qualification: M.B.B.S., FCCP, FICA
Experience: He is an eminent cardiologist by occupation and the
founder of Apollo Hospitals Ltd. He has an experience of 40 years in
medical industry.
PAN No. AAGPP9786N
Bank Account No. 22320/SB/Canara Bank-Chennai
Passport No. F2145806-Chennai
3. Ms. Preetha Reddy
Father’s Name: Dr. Prathap C Reddy
Address: No.6, Subba Rao Avenue, Chennai-600006
Age: 51 yrs
Qualification: B.SC in Chemistry and Master’s degree in Public
Administration
Experience: 24 years
PAN No. AAEPR5656F
Bank Account No. 03836/SB/Canara Bank-Chennai
Passport No. Z077081-Chennai
4. Ms. Sucharita Reddy
Father’s Name: Mr. G. Sitaram Reddy
Address: 19, Bishop Garden, Chennai- 600 028
Age: 67 years
Qualification: BA
Experience: 35 years
PAN No. AASPS4292G
Bank Account No. 22651/SB/Canara Bank-Chennai
Passport No. F2145745-Chennai
46
5.
Ms. Sangeeta Reddy
Father’s Name: Dr. Prathap C Reddy
Address: Sri Sadan, H. No. 8-674/B/2/12, Road no. 13, Banjara hills,
Hyderabad-500 034
Age: 43 yrs
Qualification: B.SC
Experience: 20 years
PAN No. AASPS6786K
Bank Account No. 17606/SB/Canara Bank
Passport No. Z077759-Chennai
6. Ms. Shobana Kamineni
Father’s Name: Dr. Prathap C Reddy
Address: 10/3-316A, Masah Tank, Hyderabad-500 025
Age: 44 years
Qualification: BA
Experience: 21 years
PAN No. AAIPK7589G
Bank Account No. 16975/SB/Canara Bank-Chennai
Passport No. Z077759-Chennai
7. PCR Investments
PCR Investments Limited was incorporated under the Companies Act, 1956 on September
26, 1996 with its registered office at 19, Temple Trees, Bishop Gardens, R A Puram, Chennai
– 600028. It is registered with Reserve Bank of India as NBFC. It commenced business on
October 21, 1996. The main objects of the company are investment in the equity shares and
carrying on the activities of Financial Services including the provision of Consultancy
Services in all areas of Corporate Management. The individual promoters of ASCIL are the
promoters of PCR Investments Ltd.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian promoters
Dr. Prathap Reddy & family
Others
NRIs/OCBs
Number of equity
shares held
% Shareholding
42,69,700
88.59
5,50,000
48,19,700
11.41
100.00
Board of Directors
a. Dr. Prathap C. Reddy
b. Mrs. Preetha Reddy
c. Mrs. Suneeta Reddy
d. Mrs. Shobana Kamineni
e. Mrs. Sangita Reddy
47
Financial Performance
The operating results of PCR Investments Limited for fiscals 2003, 2004 and 2005 are as
under:
(in Rs. Million except per share data)
Particulars
For the year ended March 31st
2003
2004
2005
Sales
14.00
16.93
21.44
Other Income
-7.11
4.79
PBIDT
9.91
22.36
25.44
PBT
(25.09)
(12.82)
3.18
PAT
(25.09)
(12.82)
3.18
Share Capital
82.58
130.38
274.1
Reserves & Surplus
25.00
25. 00
25.00
Net Worth
70.89
101.44
253.80
EPS(Rs)
(5.21)
(2.70)
0.12
Book value per share (Rs.)
14.71
21.04
9.26
Debt Equity Ratio
3.65
2.24
0.69
Dividend
0.00
0.00
0.00
The shares of the PCR Investments Limited are unlisted. There has been no change in the
capital structure of PCR Investments Limited in the last six months.
Companies with which the Promoters have disassociated in the last three years:
The Promoters have not disassociated themselves from any company in the last three years.
Common pursuits
There are no common pursuits in security related business by the promoters
Full particulars of the nature and extent of the interest, if any, of every promoter:
Except to the extent of shareholding in our Company, our Promoters and promoter group do
not have any other interest in our business.
Payment or benefit to promoters of the ASCIL:
There has been no payment made or benefit given in the two preceding years to the promoters.
48
Board of Directors
MANAGEMENT
The details of the Board of Directors of the company are given in the following table
Name & Address
Mrs. Suneeta Reddy
(D/o) Dr. Prathap C Reddy
Address: No.6 Subba Rao Avenue, Chennai 600
006.
Occupation: Business
Age
46 yrs
Other Directorship
As per Note
48 yrs
Qualification
BA, Diploma in
Financial
Management and
has completed
Owner/
President
Management
Program at
Harvard Business
School
B.COM, ACS
Mr.P.B.Subramaniyan
(S/o) P S Balasubramanian
Wholetime Director
Adresss: AC 102, Anna Nagar, Chennai 600
040.
Occupation: Service
Mr.S.K.Venkataraman
(S/o) Shri S B Krishnan
Director
Address: ‘Acquarius ‘, New No. 4/1, Old No.
22, Venkat Street, Vivekananda Nagar,
Ramapuram, Chennai – 600 078.
Occupation: Service
Mr. S. Narayanan
(S/o)Shri P Srinivisan
Director
Address: 2 C Vijay Apartments, 5 Burkit Road,
T Nagar, Chennai 600 017.
Occupation: Service
Mr. V.J.Chakco
(S/o) Mr. V.M Job
Director
Address: No.10 Water Works Avenue, Kilpauk,
Chennai 600 010.
Occupation:
Mr K Padmanabhan
(S/o) Shri S Krishnaswami
Director
Address: Plot No. 2235, AF-36, 11th Main Road,
Annanagar, Chennai – 600 040
Occupation: Service
45 yrs
FCA, ACS, AIII
As per Note
57 yrs
MFM
As per Note
78 yrs
B SC, B. COM,
FCA
As per Note
53 yrs
B. COM, MBA
As per Note
As per Note
49
Note:
Entities in which Each of the Directors hold Directorships
1. List Of Companies /Firms In Which Mrs. Suneeta Reddy is a Director /Partner
Public Limited Companies:
Sl.
No.
01.
02.
03
04
05.
06.
07.
08.
09.
10
11
12
13.
14.
15.
Name of the Companies / Firms
Nature of Interest
Apollo Sindhoori Hotels Ltd.
Apollo Hospitals Enterprise Ltd.
Apollo Hospital International Ltd.
Apollo Mumbai Hospitals Ltd.
PCR Investments Ltd.
Apollo Health Street Ltd.
Family Health Plan Ltd.
Apollo Gleneagles Hospital Ltd.
Apollo Gleneagles PET-CT Ltd.
The Lanka Hospital Corporation Ltd.
Universal Quality Services LLC
Apollo Hospital (UK) Ltd.
Apollo Infrastructure Project Finance Co. Ltd.
Indraprastha Medical Corporation Ltd.
Apollo Sindhoori Commodities Ltd
Jt. Managing Director
Director – Finance
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Alternate Director
Director
Private Limited Companies:
01
02
03.
04
05
Kalpatharu Infrastructure Development Co. Pvt.
Ltd.
PDR Investments Pvt. Ltd.
Sindya Aqua Minerals Pvt. Ltd.
Kalpatharu Trading Company Pvt. Ltd.
FSM Labs Services Pvt. Ltd.
Partnership firms:
01
P.Obul Reddy & Sons
02
Apex Agencies
03
Apex Agencies (Hyd)
04
Apex Builders
05
Apex Constructions
06
Vaishnavi Constructions
07
Kalpatharu Enterprises
08
Kalpatharu&Co.
09
Kumarnath & Company
Director
Director
Director
Director
Director
Partner
Partner
Partner
Partner
Partner
Partner
Partner
Partner
Partner
2. List of Companies in which Mr. P.B. Subramaniyan is a director
Sl. No.
1.
2.
3.
4.
5.
Name of the Companies / Firms
PPN Power Generating Company
Emed Life Insurance Broking Services Pvt. Ltd.
Spectra Hospitals Services Ltd.
Apollo Hospitals International Ltd.
Apollo Sindhoori Commodities Trading Ltd.
Nature of Interest
Director
Director
Director
Director
Director
50
6.
Medical Resources of India Limited
Director
3. List of Companies in which Mr. S.K. Venkataraman is a director
Sl. No.
1
2
3
4
Name of the Companies / Firms
AB Medical Centers Limited
Unique Home Health Care Ltd.
The Lanka Hospitals Corporation Ltd.
Apollo Gleneagles Hospital Ltd.
Nature of Interest
Director
Director
Alternate Director
Alternate Director
4. List of Companies in which Mr. S. Narayanan is a director
Sl. No.
1
Name of the Companies / Firms
PPN Power Generating Company Pvt Ltd.
Nature of Interest
Managing Director
5. List of Companies in which Mr. V.J. Chacko is a director
Sl.
No.
1
Name of the Companies / Firms
Nature of Interest
Apollo Sindhoori Hotels Limited
Director
6. List of Companies in which Mr. Padmanabhan is a director
Sl.
No.
1
2
3
4
5
Name of the Companies / Firms
Nature of Interest
Apollo Mumbai Hospitals Ltd.
Apollo Health & Lifestyle Limited
The Lanka Hospitals Corporation Ltd.
Family Health Plan Limited
Apollo Sindhoori Commodities Trading Ltd.
Director
Director
Director
Director
Director
Brief Biography of Our Directors
1. Ms. Suneeta Reddy
Name
Father’s Name
Address
Age
Qualification
Experience
UIN (MAPIN) No.
Occupation
Career graph for Directors i.e. Experience in
the Industry
Positions/Posts held in the past
Ms. Suneeta Reddy
Dr. Prathap C Reddy
No. 6 Subba Rao Avenue, Chennai-600006
46 years
BA
20 yrs
A00296848
Business
Director of the Company since incorporation
i.e 04.07.1995 and was elevated as
Chairperson on 20th June 2003. She has 10
years of experience in the industry.
Worked in developing the concept of India’s
first corporate hospital till the hospital began
operations in 1985 and was involved in
conceiving, planning and implementation of
51
Positions of repute held (Industry
Associations, Govt agencies)
Number of shares held including details on
qualification shares held
Om Sindhoori Hotel Limited in Chennai.
Joint Managing Director of Apollo Sindhoori
Hotels Limited and Director-Finance of
Apollo Hospitals Enterprise Limited.
70525 shares
2. Mr. K.Padmanabhan
Name
Father’s Name
Address
Age
Qualification
Experience
UIN (MAPIN) No.
Occupation
Career graph for Directors i.e. Experience in
the Industry
Positions/Posts held in the past
Positions of repute held (Industry
Associations, Govt agencies)
Number of shares held including details on
qualification shares held
Mr. K.Padmanabhan
Dr. S.Krishnaswamy
Plot No. 2235, AF-36, 11th Main Road,
Annanagar, Chennai – 600 040.
53 years
B COM, MBA
28 years
A00296814
Service
Joined Apollo Hospitals as the group
President in 1996 and is responsible for all the
investments in the group’s implementation of
new projects.
Started his career with TI Cycles of India as a
Product Manager and subsequently held the
positions of General Manager, Vice President
and CEO.
Same as above
42136 shares
3. Mr. V.J.Chacko
Name
Father’s Name
Address
Age
Qualification
Experience
UIN (MAPIN) No.
Occupation
Career graph for Directors i.e. Experience in
the Industry
Positions/Posts held in the past
Mr. V.J.Chacko
Mr. Job Jacob
10, Water works Avenue, Chennai –600010
78 years
ACA
54 years
A00326348
Service
Appointed as Director on 17th July 2003.
Positions of repute held (Industry
Associations, Govt agencies)
Was also Director of quite a few other
companies including some of the Apollo
Group of Companies and a member of the
governing body of Rajeev Gandhi Cancer
Started his career in Spencer & Co Ltd, as an
audit assistant in the year 1951. He resigned
from Spencer’s and joined Dr P.C. Reddy’s
Apollo Hospital in the year 1980, as its Chief
Executive Officer and was promoted as the
Managing Director of the hospital.
52
Institute, Delhi. On retirement from Apollo
Hospitals, Delhi, joined Miot Hospital,
Chennai as Executive Vice Chairman on a two
year tenure. At present, he is also a director of
Apollo Sindhoori Hotels Ltd, Chennai.
Number of shares held including details on
qualification shares
9335 shares
4. Mr. S. Narayanan
Name
Father’s Name
Address
Age
Qualification
Experience
UIN (MAPIN) No.
Occupation
Career graph for Directors i.e. Experience in
the Industry
Mr. S. Narayanan
Mr. P Srinivisan
Plot No. 2 C, Vijay Apartments, 5, Burkit
Road, T Nagar, Chennai –600 017
57 years
MFM
35 years
A00302232
Service
Appointed as Director on 25.09.1996 and is
having 9yrs of experience in the industry.
Presently, he is the Managing Director of PPN
Power Generating Company Limited.
Positions/Posts held in the past
Held several positions in finance and
commercial areas, and last held the position of
Chief Executive - Finance in a large South
India based group, responsible for the finance
functions for the group.
Number of shares held including details on
qualification shares
200 shares
5. Mr. S.K.Venkataraman
Name
Father’s Name
Address
Age
Qualification
Experience
UIN (MAPIN) No.
Occupation
Career graph for Directors i.e. Experience in
the Industry
Positions/Posts held in the past
Mr. S.K.Venkataraman
Mr. S B Krishnan
‘Acquarius ‘, New No. 4/1, Old No. 22,
Venkat Street, Vivekananda Nagar,
Ramapuram, Chennai – 600 078.
45 years
FCA, ACS, AIII
21 years
A00302265
Service
Appointed as Director on 25.09.1996 and is
having 12 yrs of experience in the industry.
Presently he is the Chief Financial Officer of
Apollo Hospitals Enterprise Limited.
Has been associated with renowned
organizations like M/s. Price Water & Co.,
S.B. Billimoria & Co., and Shriram Fibres
Limited and has vast experience in Finance,
53
Audit, MIS and Taxation
companies.
areas in these
Positions of repute held (Industry
Associations, Govt agencies)
Presently the Chief Financial Officer &
Company Secretary of Apollo Hospitals
Enterprise Ltd. and is heading the various
functions of Finance, Secretarial, Accounting,
Auditing, Insurance, Diversification, Merger
and Acquisition
Number of shares held including details on
qualification shares.
23627 shares
6. Mr. P.B.Subramaniyan
Name
Father’s Name
Address
Age
Qualification
Experience
UIN (MAPIN) No.
Driving License No.
Occupation
Career graph for Directors i.e. Experience in
the Industry
Mr. P.B.Subramaniyan
Mr. P.S.Balasubramaniyan
AC 102, Anna Nagar, Chennai – 600 040
48 years
B.Com, ACS
23 years
A00223297
04358/NL/NCO/96
Service
Director of the Company since incorporation
i.e. 04.07.1995 and was elevated as Executive
Director on 1.10.1998. He has 12 years of
experience in the industry.
Positions/Posts held in the past
Has been the Company Secretary of Malladi
Drugs and Pharmaceuticals Ltd for a year and
the Company Secretary of Apollo Hospitals
Enterprise Limited for 10 years.
Number of shares held including details on
qualification shares
90145 shares
NATURE AND INTEREST OF DIRECTORS
No director of the company is interested in the appointment of the Lead Manager and
Registrars. No director of the company is interested in any property acquired by the company
within two years of the date of LoF or proposed to be acquired by it. The directors are not
interested in any loan or advance given by the company to any person(s)/
company/companies nor are they beneficiaries of any loan or advance.
CHANGES IN DIRECTORS
The changes in the directors of the company in the last three years are given below:
Name of the Director
Mr V J Chacko
Date of
Appointment/Resignation
17th July 2003
Reason for Change
New Appointment
54
ORGANISATION STRUCTURE
The organization structure of the company is as follows:
55
KEY MANAGERIAL PERSONNEL
The details of our key management personnel are as follows:
Name
Mrs. Geetha
Sridhar
Mr. D R
Nagarajan
Designatio
n
&Function
al area
Company
Secretary,
also
handling
Admin &
HR, Legal.
General
Manger –
Operations
Back office,
RMS,
System,
Help desk
Qualification
Expe
rienc
e
B.Com, ACS,
AICWA
18
yrs
B.Sc. (Chem)
22
yrs
Gross
Remu
nerati
on
9 lacs
Date of
Appointmen
t
Details of Previous
Employment
3rd June
2001
In Southern Shelters
Ltd for 1 year and
Om Sindhoori Cap
Invt Ltd for 5.5 yrs as
Company Secretary
9.32
lacs
15th Dec
2004
In Freelance for 3 yrs
as Consultant, Aruna
Sugars as project
manager for 3 yrs,
Genesis Infotech Ltd
for 4 yrs as System
manager,
Thiru
Arooran Sugars for 6
yrs as Senior System
Officer
and
in
Cholamandalam
Software Ltd for 2 yrs
as
Programme
Developer
In Om Sindhoori
Capital Invts Ltd for
9 yrs as Branch
Manager.
In J.K.Ind Ltd as Asst
Accountant for 7 yrs
and Om Sindhoori
Cap Invt Ltd for 3 yrs
as Finance Manager.
In Om Sindhoori
Capital Investments
Ltd.
as
Senior
Executive for 6 years.
B.Com,
19
8.22
1st Apr 1999
General
CA(Int)
yrs
lacs
Manager Commoditi
es
B.SC ,
24
8.88
1st Apr 1999
Mr T P
Asst
ACA
yrs
lacs
Venkoba
General
Rao
Manger Depository
operation
B.com
21yrs 6.5
1st Apr 1999
Mr. K J
Assistant
lacs
Satheesh
General
Manager Marketing
and BRCO
ACA,
15
5.4
25th Feb
Mr D
Senior
In Ernst & Young as
BA (Eco)
yrs
lacs
Subrahmany Manager 2005
Manager for 7 yrs
an
Funds,
and in Lovelock &
Accounts
Lewis as Assistant
and MIS.
the Manager for 1 yr.
All the persons whose names appear as key management personnel are on permanent rolls of
the Company and are not employed by any of our Group concerns.
Mr. D Balaji
SHAREHOLDING OF KEY MANAGEMENT PERSONNEL (KMP)
The aggregate shareholding of key management personnel along with relatives as on
September 9,2005 was 67,381 shares. The table provides details of shareholding of key
management personnel with their relatives.
56
Name of KMP and their Designation
of No. of shares
relatives
/
KMP
Relationship with
KMP
Mrs. Geetha Sridhar
Company Secretary
21,500
Mr. D R Nagarajan
General Manager
500
Mr. D Balaji
General Manager
18,900
Mr. T P Venkoba Rao
Asst Gen Manager
19,501
Mr. K J Satheesh
Asst Gen Manager
6,780
Mr. D Subrahmanyan
Senior Manager
250
Total
67,431
CHANGES IN KEY MANAGEMENT PERSONNEL
The changes in the key management personnel in the last three years are given below:
NAME OF EMPLOYEE
Mr. D R Nagarajan
Mr. D Subrahmanyan
Mr K P Satheesan
Date of
Appointment/
Resignation
15th December 2004
25th Feb 2005
18th July 2005 Resignation
Designation
Reason for Change
General Manager
Senior Manager
General Manager
New Appointee
New Appointee
Resigned for better
Prospects
CHANGES IN AUDITORS IN THE LAST THREE YEARS:
There has been no change in auditors during the last 3 years.
INVESTOR GRIEVANCES AND REDRESSAL SYSTEM
There is no investor grievance committee at present as the Corporate Governance clause is not
applicable to us. A specific team in the secretarial department of the Company, headed by Mrs.
Geetha Sridhar, Company Secretary, has been identified to redress the investor grievances. Any
usual investor grievance such as non-receipt of shares, non-receipt of declared dividends,
conversion of share certificate, change of address is attended to within 48 hours, whereas those
pertaining to prior periods i.e. belonging to 2-3 years prior to the current year are resolved in a
week’s time.
Further, as the Company is engaged in rendering stock broking services, investor grievances
pertaining to the clients of the Company are attended by a team of 10 members, who are part of
the “HELP DESK”. These individuals are experts in different fields of the Stock Broking
industry and they take around 48 hours to resolve the grievances.
The details of the compliance officer of the company are as follows:
Ms. Geetha Sridhar
Company Secretary
Ali Towers – IV Floor
55, Greams Road,
Chennai – 600 006.
57
GROUP COMPANIES
1.
Apollo Hospitals Enterprise Limited
Apollo Hospitals Enterprise Limited was incorporated under the Companies Act, 1956 on
December 5, 1979 with its registered office at #19, Bishop Gardens, Raja Annamalaipuram,
Chennai – 600028. It commenced business on December 27. 1979. It is primarily a hospital
service provider with most of its hospitals offering services in the areas of cardiology,
oncology, nephrology, laboratory services, radiology and imaging, maternity and day care,
general surgery as well as diagnostic and emergency services. The hospitals also offer a
consultations for a variety of ailments, preventive health screenings, laboratory services,
radiology and imaging services. Apollo Hospitals Enterprise Limited also offers precommissioning and post-commissioning consultancy services. It has a large network of
retail pharmacies.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian promoters
Dr. Prathap Reddy
Ms. Sucharita Reddy
Ms. Preetha Reddy
Ms. Suneeta Reddy
Ms. Shobana Kamineni
Ms. Sangita Reddy
PCR Investments Limited
Others
Foreign promoters
Persons acting in concert
Sub-Total
Non-promoter holding
Mutual Funds and UTI
Banks, Financial Institutions
Insurance Companies
FIIs
Sub-Total
Others
Private Corporate Bodies
Indian public
NRIs/OCBs
Any other (please specify)
Sub-Total
Total
Number of equity
shares held
&
% Shareholding
14,64,593
17,29,937
7,24,679
3,96,795
10,89,976
12,81,254
54,37,431
19,45,764
0
0
1,40,70,429
3.52
4.16
1.74
0.95
2.62
3.08
13.07
4.68
0.00
0.00
33.82
2,46,934
9,90,022
0.59
2.38
1,16,04,210
1,28,41,166
27.90
30.87
10,75,937
60,34,786
12,82,955
62,93,345
1,46,87,023
4,15,98,618
2.59
14.51
3.08
15.13
35.31
100.00
58
Board of Directors
a. Dr. Prathap C. Reddy
b. Ms. Preetha Reddy
c. Ms. Suneeta Reddy
d. Ms. Sangita Reddy
e. Mr. P. Obul Reddy
f. Mr. T M Joseph
g. Mr. Rajkumar Menon
h. Mr. Rafeeque Ahamed
i. Mr. N Vaghul
j. Mr. Deepak Vaidya
k. Mr. T K Balaji
l. Mr. Habibullah Badsha
m. Dr. Jennifer Lee Gek Choo
n. M Chittaranjan Kumar
Financial Performance
The operating results of Apollo Hospitals Enterprise Limited for fiscals 2003, 2004 and 2005
are as under:
(in Rs. Million except per share data)
Particulars
For the year ended March 31st
2003
2004
2005
Income from healthcare services
4,382.12
4,997.66
5,956.11
Other Income
103.39
0.00
0.00
PBIDT
928.66
1,041.22
1,215.56
PBT
433.10
586.18
714.18
PAT
274.94
371.48
491.83
Share Capital
395.19
395.19
415.99
Reserves & Surplus
1864.56
2071.56
2862.21
Net Worth
2181.82
2410.26
3244.85
EPS (Rs)
6.96
9.4
12.12
Book value per share (Rs.)
55.21
60.99
78.0
Debt Equity Ratio
0.79
0.65
0.42
Dividend per share (Rs.)
3.0
3.5
4
The shares are listed on BSE, NSE, and LxSE. The details of the highest and the lowest price
on BSE, NSE, and LxSE during the last six months is as follows
Highest (Rs.)
Date
Lowest (Rs.)
Date
BSE
546.4
September 21, 2005
328
June 10, 2005
NSE
555.75
September 21, 2005
317.85
June 16, 2005
LxSE
US$12.04
September 20, 2005
US$8.13
July 11, 2005
(Source: www.bseindia.com, www.nse-india.com, www.bourse.lu)
During the current financial year, the company completed a GDR issue of US$ 70.2 through
the issue of 9 million Global Depository Receipts (including the green shoe) totaling Rs. 306
crores. The GDR was priced at $7.8 (Rs 340) per GDR against a closing price of Rs 347.95
per share on the BSE, Mumbai on July 07, 2005. This translated into a premium of Rs. 330
per share.
59
2.
Indraprastha Medical Corporation Limited
Indraprastha Medical Corporation Limited was incorporated under the Companies Act,
1988 on March 16, 1988 with its registered office at Hospital Complex, Sarita Vihar, DelhiMathura Road, New Delhi – 110076. It commenced business on April 7, 1988. Indraprastha
Medical Corporation Limited runs a multi super-specialty hospital and is a major center for
international clinical trials.
Shareholding as of March 31, 2005
Shareholder
No. of equity
%
shares held
Shareholding
Promoter Holding
44.95
4,12,10,374
Indian promoters
4.43
40,60,951
Foreign promoters
0.00
0
Persons Acting in Concert
49.38
4,52,71,325
Sub Total
Non-promoter holding
1.56
14,32,300
Banks, Financial Institutions
0.00
0
Insurance companies
0.88
8,00,000
FIIs
2.44
22,32,300
Sub Total
Others
3.28
30,03,651
Private Corporate Bodies
15.35
1,40,73,307
Indian public
29.55
2,70,92,417
NRIs/OCBs
48.18
4,41,69,375
Sub Total
Total
9,16,73,000
100.00
Board of Directors
(a) Mr. S Regunathan
(b) Dr. Prathap C. Reddy
(c) Ms. Anne Marie Moncure
(d) Mr. Anil Thadani
(e) Dr. B Venkataraman
(f) Ms. Renu S Karnad
(g) Mr. S P Aggarwal
(h) Ms. Suneeta Reddy
(i) Lt. Gen. Vijay Lall
(j) Mr. V. Rajagopala Reddy
Financial Performance
The operating results of Indraprastha Medical Corporation Limited for fiscals 2003, 2004
and 2005 are as under:
(in Rs. Million except per share data)
Particulars
For the year ended March 31st
2003
2004
2005
Sales
1,449.80
1,659.36
1,778.69
Other Income
130.41
146.44
1,61.86
PBIDT
332.34
393.06
382.02
PBT
188.21
245.34
235.49
PAT
111.88
154.92
163.46
Share Capital
916.73
916.73
916.73
Reserves & Surplus
145.85
197.37
168.53
Net Worth
1,053.50
1,108.04
1,082.23
EPS(Rs)
1.22
1.69
1.78
Book value per share (Rs.)
11.49
12.09
11.81
Debt Equity Ratio
0.34
0.21
0.15
Dividend
0.85
1.0
1.0
60
The shares are listed on BSE and NSE. The details of the highest and the lowest price on
BSE and NSE during the last six months is as follows
Highest (Rs.)
Date
BSE
54.6
September 20, 2005
NSE
54.9
July 25, 2005
(Source: www.bseindia.com, www.nse-india.com)
Lowest (Rs.)
29
28.35
Date
April 19, 2005
May 3, 2005
There has been no change in the capital structure of Indraprastha Medical Corporation
Limited in the last six months.
61
3.
Apollo Health Street Private Limited
Apollo Health Street Private Limited was incorporated on October 8. 1999 under the
Companies Act, 1956 on October 8, 1999 under the name Apollo Health Street Limited with
its registered office at No. 19, Bishop Gardens, Raja Annamalaipuram, Chennai – 600028.
Limited. It commenced business on December 13, 1999. Subsequently, the Registrar of
Companies, vide their letter no. 18-43316/S.21/2005 dated 26th May 2005, changed the
name of the company to Apollo Health Street Private Limited. The company is engaged in
the business of medical billing, coding and IT implementation for other group companies.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian promoters
Family and associates
Sub-total
Others
Private Corporate Bodies
Indian public
NRIs/OCBs
Others
Sub-total
Number of equity
shares held
% Shareholding
61,00,000
20,79,908
81,79,908
46.76
15.94
62.71
0
0
4,050,000
8,15,209
4,865,029
130,44,937
0.00
0.00
31.05
6.25
37.29
100.00
Board of Directors
a. Dr. Prathap C. Reddy
b. Ms. Sangita Reddy
c. Mr. Tarek Shoeb
d. Mr. Amit Burman
e. Mr. N. J. Yasaswy
f. Mr. Ravi Krishnasamy
Financial Performance
The operating results for fiscals 2003, 2004 and 2005 are as under:
(in Rs. Million except per share data)
Particulars
For the year ended March 31st
2003
2004
2005
Sales
83.69
172.88
243.62
Other Income
2.50
5.62
(0.015)
PBIDT
(34.12)
21.86
1.74
PBT
(40.75)
6.01
(18.92)
PAT
(24.14)
5.09
(24.19)
Share Capital
83.10
83.10
83.10
Reserves & Surplus
0.022
(1.74)
(1.48)
Net Worth
39.53
79.70
112.82
EPS(Rs)
0.61
Book value per share (Rs.)
10
10
10
Debt Equity Ratio
0.04
0.52
0.58
Dividend
Nil
Nil
Nil
The shares of the company are unlisted.
There has been no change in the capital structure of Apollo Health Street Limited in the last
six months.
62
4.
Apollo Health and Lifestyle Limited
Apollo Health and Lifestyle Limited was incorporated under the Companies Act, 1956 on
November 10, 2000 with its registered office at 20, IInd Street, East Abhiramapuram,
Mylapore, Chennai - 600004. It commenced business on November 13, 2000. It is engaged
in franchising of healthcare services.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian Promoters
Apollo Hospitals Enterprise Limited
Number of equity
shares held
% Shareholding
15,00,000
100.00
15,00,000
100.00
Board of Directors
a. Dr. Prathap C. Reddy
b. Ms. Sangita Reddy
c. Mr. K. Padmanabhan
d. Dr. Vikram Jitsingh Chatwal
Financial Performance
The operating results of Apollo Health and Lifestyle Limited for fiscals 2003, 2004 and 2005
are as under:
(in Rs. Million except per share data)
Particulars
For the year ended March 31st
2003
2004
2005
Sales
51.96
56.54
55.90
Other Income
2.66
3.05
6.40
PBIDT
8.50
11.47
4.50
PBT
3.50
6.33
(0.66)
PAT
3.28
5.90
(0.66)
Share Capital
15.00
15.00
15.00
Reserves & Surplus
0.00
0.00
0.00
Net Worth
(12.38)
(6.48)
(7.14)
EPS(Rs)
2.19
3.94
Book value per share (Rs.)
(8.25)
(4.32)
(4.76)
Debt Equity Ratio
2.46
2.59
2.80
Dividend
Nil
Nil
Nil
The shares of the Apollo Health and Lifestyle Limited are unlisted. There has been no
change in the capital structure of Apollo Health and Lifestyle Limited in the last six
months.
63
5.
Apollo Hospitals International Limited
Apollo Hospitals International Limited was incorporated under the Companies Act, 1956
under the name of Akshaya Apollo Hospitals Limited on September 12, 1997 with its
registered office at #19, Bishop Gardens, Raja Annamalaipuram, Chennai – 600028. It
commenced business on October 15, 1997. Subsequently, the name of the company was
changed from Akshaya Apollo Hospitals Ltd. to Apollo Hospitals International Limited
vide RoC letter no. 18-39016/S.21/2004 dated 25th March 2004. It primarily provides
healthcare services through its hospital at plot No.1A GIDC Estate, Bhat Village, Gandhi
Nagar 382 428 and is emerging as a one-stop destination for patients from Gujarat, South
Rajasthan and West Madhya Pradesh apart from the growing non-resident Gujarati
population in South African Countries, UK, Canada and USA.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian Promoters
Apollo Hospitals Enterprise Limited
Dr. Pratap C Reddy & Associates
Sub-total
Non-promoter holding
Banks, Financial Institutions
Number of equity
shares held
% Shareholding
2,23,30,000
15,970
2,23,45,970
55.35
0.04
55.39
1,79,99,999
4,03,45,969
44.61
100.00
Board of Directors
a. Dr. Prathap C. Reddy
b. Mr. C. D. D. Reddy
c. Ms. Preetha Reddy
d. Ms. Suneeta Reddy
e. Ms. Shobana Kamineni
f. Ms. Sangita Reddy
g. Mr. P. B. Subramaniyan
h. Dr. B. Premkumar
Financial Performance
The operating results of Apollo Hospitals International Limited for fiscals 2003, 2004 and
2005 are as under:
(in Rs. Million except per share data)
For the year ended 31st March
Particulars
2003
2004*
2005
Sales
NA
NA
74.60
Other Income
NA
NA
0.00
PBIDT
NA
NA
(31.81)
PBT
NA
NA
(83.11)
PAT
NA
NA
(55.32)
Share Capital
325.46
403.46
403.46
Reserves &
48.00
90.00
90.00
Surplus
Net Worth
373.46
493.46
438.0
EPS(Rs)
NA
NA
-1.37
Book value per
11.55
12.23
10.86
share (Rs.)
Debt Equity Ratio
1.58
1.35
1.70
Dividend
Nil
Nil
Nil
64
*The company commenced operations on October 24, 2004
The shares of the Apollo Hospitals International Limited are unlisted. There has been no
change in the capital structure of Apollo Hospitals International Limited in the last six
months.
6.
AB Medical Centers Limited
AB Medical Centers Limited was incorporated under the Companies Act, 1956 under the
name of P & B Medical Centres Private Limited with its registered office at No. 154
Poonamallee High Road, Kilpauk, Chennai - 600010. Its name was changed to A B Medical
Centers Private Limited on June 20, 1988, vide application no. 33/6623/DlES210/88.
Subsequently, the word “Private” was deleted from the name of the company under
Section 44 of the Indian Companies Act. 1956 and the name of the company was changed to
A B Medical Centres Limited w.e.f. 28th September 2002. A B Medical Centers Limited is
engaged in the business of letting out property and medical equipments to Apollo
Hospitals Enterprise Limited.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Apollo Hospitals Enterprise Limited
Foreign Promoters
Persons acting in concert
Number of equity
shares held
16,800
0
0
16,800
% Shareholding
100.00
0.00
0.00
100.00
Board of Directors
a. Mrs. Preetha Reddy
b. Mrs. Suneeta Reddy
c. Mr. S K Venkataraman
d. Mr. G Narotham Reddy
Financial Performance
The operating results of AB Medical Centers Limited for fiscals 2003, 2004 and 2005 are as
under:
(in Rs. Million except per share data)
Particulars
For the year ended March 31st
2003
2004*
2005
Rent Received
0.96
6.48
6.48
Other Income
0.24
0.72
0.76
PBIDT
1.19
7.17
7.01
PBT
(0.47)
5.86
5.90
PAT
(0.06)
4.00
2.41
Share Capital (FV Rs. 1000
16.80
16.80
16.80
per share)
Reserves & Surplus
0.18
0.18
0.18
Net Worth
(0.68)
3.32
5.73
EPS(Rs)
237.92
143.25
Book value per share (Rs.)
(40.35)
197.58
340.82
Debt Equity Ratio
5.48
2.93
Dividend
Nil
Nil
Nil
The shares are of the AB Medical Centers Limited are unlisted.
There has been no change in the capital structure of AB Medical Centers Limited in the last
six months.
65
7.
The Lanka Hospitals Corporation Limited
The Lanka Hospitals Corporation Limited was incorporated on 9th November 2001 under
the name of The Lanka Hospitals Corporation Private Limited under the Sri Lankan
Companies Act, 1982 with its registered office at No. 60, Rio Building, Kumaran Ratnam
Road, Colombo 02. Subsequently, the name of the company was changed to The Lanka
Hospitals Corporation Limited. It commenced business on June 1, 2002. The Lanka
Hospitals Corporation Limited is engaged in the business of healthcare services
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian Promoters
Apollo Hospitals Enterprise Limited
Foreign promoters
Sri Lanka Insurance Corporation
Limited (Life Fund)
Property Development Limited
Dr. Senthilverl Thirugnanasambandar
Mr Ratnaraja Navratnam
Persons acting in concert
Sub Total
Non-promoter holding
Institutional Investors
EPF & E T F
Banks, Financial Institutions
Insurance companies
FIIs
Sub Total
Others
Private Corporate Bodies
Indian Public
NRIs/OCBs
Individuals
Sub Total
Total
Number of equity
shares held
% Shareholding
48,015,000
30.66
30,670,150
19.58
21,329,000
16,733,800
5,076,299
13.62
10.68
3.24
121,824,249
77.78
8,118,500
2,523,900
3,779,600
275,000
0
14,697,000
5.18
1.62
2.41
0.18
0.00
9.39
1,027,900
0
0
19,063,369
20,091,269
156,612,518
0.65
0.00
0.00
12.18
12.83
100.00
Board of Directors
a. Dr. Prathap Reddy
b. Mr. Ratnaraja Navaratnam
c. Ms. Suneeta Reddy
d. Mr. K. Padmanabhan
e. Mr. Bob Kundanmal
f. Mr. Ralph de Lanerolle
g. Mr. S. N. P. Palihena
h. Mr. N. S. Welikala
i. Mr. S.M.Paranavitana
j. Mrs. Preetha Reddy – alternate director to Dr. Prathap C Reddy
k. Mr. S.K. Venkataraman- alternate director to Ms. Suneeta Reddy
l. Mr. Russel De Mel- alternate director to Mr. N.S. Welikala
66
Financial Performance
The operating results of The Lanka Hospitals Corporation Limited for fiscals 2003, 2004 and
2005 are as under:
(in SriLankan Rs. Million except per share data)
Particulars
For the year ended March 31st
2003 (10 m)
2004
2005
Sales
805.40
1,486.83
1,656.85
Other Income
14.28
1.26
2.62
PBIDT
(72.95)
181.54
245.73
PBT
(268.46)
(206.26)
(55.42)
PAT
(272.29)
(206.51)
(55.95)
Share Capital
1,566.13
1,566.13
1,566.13
Reserves & Surplus 98.62
98.62
98.62
Net Worth
1,392.46
1,185.95
1,130.00
EPS (Rs)
(2.04)
(1.32)
(0.36)
Book value per share (Rs.)
8.89
7.57
7.22
Debt Equity Ratio
0.71
0.81
0.70
Dividend
Nil
Nil
Nil
The shares are listed on Colombo Stock Exchange. The details of the highest and the lowest
price during the last six months is as follows
Highest (SLR)
Colombo
27.25
Stock
Exchange
(Source: www.cse.lk)
Date
30th September
2005
Lowest (SLR)
19.00
Date
28th July 2005
There has been no change in the capital structure of The Lanka Hospitals Corporation
Limited in the last six months.
8.
Unique Home Healthcare Limited
Unique Home Healthcare Limited was incorporated under the Companies Act, 1956 on
June 2, 1995 with its registered office at No. 19, Bishop Gardens, Raja Annamalaipuram,
Chennai – 600028. It commenced business on April 25, 1996 and provides medical and
paramedical services, including, doctor’s consultation, nursing services, physiotherapy and
medical equipment direct to patients homes. It also offers paramedical services in hospitals
to critically ill patients.
Shareholding as of March 31, 2005
Shareholder
Number of equity
shares held
% Shareholding
Promoter Holding
Indian Promoters
Apollo Hospitals Enterprise Limited
823,012
100.00
Total
8,23,012
100.00
Board of Directors
a. Mr. S. K. Venkataraman
b. Mr. V. Satyanarayana Reddy
c. Mr. G. Narotham Reddy
d. Mr. C Sreedhar
67
Financial Performance
The operating results of Unique Home Healthcare Limited for the years 2003, 2004 and 2005
are as under:
Particulars
Sales
Other Income
PBIDT
PBT
PAT
Share Capital
Reserves & Surplus
Net Worth
EPS (Rs)
Book value per share (Rs.)
Debt Equity Ratio
Dividend
(in Rs. Million except per share data)
For the year ended March 31st
2003
2004*
2005
4.17
4.32
6.02
1.18
0.91
2.10
1.12
0.79
2.00
0.66
0.50
1.26
1.23
8.23
8.23
1.99
2.85
4.40
3.19
11.06
12.62
5.37
0.61
1.54
25.92
13.43
15.33
0.00
0.025
0.013
Nil
Nil
NIL
The shares of Unique Home Healthcare Limited are unlisted. There has been no change in
the capital structure of Unique Home Healthcare Limited during the past six months.
9.
Apollo Gleneagles Hospital Limited
Apollo Gleneagles Hospital Limited was incorporated under the Companies Act, 1956
under the name of “Janapriya Hospitals Corporation Limited” on September 19, 1988 with
its registered office at 58, Canal Circular Road, Kolkata - 700054. Its name was changed to
Duncan Goenka Hospitals Limited, vide ROC letter no. NCR/CN/45223/95 dated 2nd
February 1995. Subsequently, its name was changed to Apollo Gleneagles Hospital Limited
vide ROC letter no. NCR/CN/45223/96 dated 22nd January 2003. It commenced business
on 14th October 1988. Apollo Gleneagles Hospital Limited is engaged in the business of
providing tertiary level healthcare.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian Promoters
Apollo Hospitals Enterprise Limited
Foreign promoters
Gleneagles Development Pvt. Ltd.
Total
Number of equity shares held
% Shareholding
23,250,198
49.00
24,199,184
47,449,382
51.00
100.00
Board of Directors
a. Dr. Prathap Reddy
b. Ms. Preetha Reddy
c. Ms. Suneeta Reddy
d. Mr. Asish J Shastry
e. Dr. Lim Cheok Peng
f. Mr. Vivek Jetley
68
Financial Performance
The operating results of Apollo Gleneagles Hospital Limited for fiscals 2003, 2004 and 2005
are as under:
Particulars
Sales
Other Income
PBIDT
PBT
PAT
Share Capital
Reserves & Surplus
Net Worth
EPS(Rs)
Book value per share (Rs.)
Debt Equity Ratio
Dividend
2003
120.69
4.57
(5.48)
(21.49)
(21.49)
423.99
65.94
311.90
(0.59)
7.36
4.05
Nil
(in Rs. Million except per share data)
For the year ended March 31st
2004
2005
398.74
659.16
7.70
26.07
11.93
43.72
(183.72)
(160.49)
(183.72)
(160.49)
423.99
474.49
65.94
65.94
22.19
(107.98)
(4.33)
(3.72)
0.52
(2.28)
71.37
-ve
Nil
Nil
The shares of the Apollo Gleneagles Hospital Limited are unlisted. There has been no
change in the capital structure of the company in the past six months.
10. Family Health Plan Limited
Family Health Plan Limited was incorporated under the Companies Act, 1956 on April 26,
1995 with its registered office at 1st Floor, Ali Towers, #22, Greams Road, Chennai – 600006.
It commenced business on 11th January 1996. Family Health Plan Limited is engaged in the
business of Healthcare Administration.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian Promoters
Apollo Hospital Enterprises Ltd.
PCR Investment Ltd.
Shobana Kamineni
Others
Foreign Promoters
Persons acting in concert
Sub-total
Others
Private Corporate Bodies
Indian Public
NRIs/OCBs
Any other
Sub-total
Grand Total
Number of equity
shares held
% Shareholding
4,90,000
2,50,000
32,000
30
0
7,72,030
49.00
25.00
3.20
0.00
0.00
77.20
2,02,930
25,040
0
0
2,27,970
10,00,000
20.29
2.50
0.00
0.00
22.80
100.00
Board of Directors
a. Ms. Shobha Kamineni
b. Ms. Suneeta Reddy
c. Ms. Sangita Reddy
69
d. Mr. K. Padmanabhan
e. Dr. B. Premkumar
f. Mr. Bharat Kumar J. Boda
Financial Performance
The operating results of Family Health Plan Limited for fiscals 2003, 2004 and 2005 are as
under:
Particulars
Income from Operation
Other Income
PBIDT
PBT
PAT
Share Capital
Reserves & Surplus
Net Worth
EPS (Rs)
Book value per share (Rs.)
Debt Equity Ratio
Dividend
(Rs.)
2003
34.27
1.11
1.69
0.98
0.62
10.00
0.36
10.36
0.62
10.35
0.00
Nil
(in Rs. Million except per share data)
For the year ended March 31st
2004
2005
95.25
144.09
2.22
4.00
18.83
23.45
14.53
17.62
9.71
10.96
10
10
10.07
19.90
29.07
29.90
9.71
10.95
20.07
29.90
0.95
1.65
Nil
10.0**
**Interim Dividend
The shares of the Family Health Plan Limited are unlisted.
There has been no change in the capital structure of Family Health Plan Limited in the last
six months.
11. PCR Investments Limited
Refer to page no. 46 in the section titled “ Promoter & Promoter Group”.
12. Other Group companies
(a) Medvarsity Online Limited
Medvarsity Online Limited was incorporated under the Companies Act, 1956 on 6th
November 2000 with its registered office at Life Sciences Building, Apollo Hospitals
Complex, Jubilee Hills, Hyderabad-33. It commenced business on the same day.
Medvarsity Online Limited undertakes courses in medicine, pharmacy and other related
areas and establishes colleges/institutions for imparting the same.
(b) Apollo Health Street Inc.
Apollo Health Street Inc was incorporated under the laws of State of Delaware in United
States of America on 9th December 2002 with its registered office at 86, Fillmore Street,
Newark, NJ- 07105-3260. It provides health care services in the United States of America.
70
SUBSIDIARIES
a.
Apollo Sindhoori Commodities Trading Limited
Apollo Sindhoori Commodities Trading Limited was incorporated under the Companies
Act, 1956 on October 10, 2003 with its registered office at 55 Greams Road, Chennai 600 006.
It commenced business on October 15, 2003. It is engaged in the business of commodity
trading.
Shareholding as of March 31, 2005
Shareholder
Promoter Holding
Indian Promoters
Apollo Sindhoori Capital
Investments Limited
Grand Total
Number of equity
shares held
% Shareholding
9,50,000
100.00
9,50,000
100.00
Board of Directors
a. Mrs. Suneeta Reddy
b. Mr. K Padmanabhan
c. Mr. P. B. Subramaniyan
Financial Performance
The operating results of Apollo Sindhoori Commodities Trading Limited for the 15 month
period ended 31.12.2004 and the 3 months ended 31.3.2005 are as under:
(in Rs. Million except per share data)
Particulars
15 months ended
3 months ended
31st December 2004
31st March 2005*
Income from operations
0.63
0.89
Other Income
0.00
0.00
PBIDT
(0.63)
0.58
PBT
(0.80)
0.44
PAT
(0.86)
0.47
Share Capital
9.5
9.5
Reserves & Surplus
0.00
0.00
Net Worth
8.64
9.10
EPS (Rs)
0.49
Book value per share (Rs.)
9.09
9.58
Debt Equity Ratio
0.00
0.00
Dividend
Nil
Nil
The shares of Apollo Sindhoori Commodities Trading Limited are unlisted.
There has been no change in the capital structure of Apollo Sindhoori Commodities
Trading Limited in the last six months.
71
FINANCIAL PERFORMANCE OF THE COMPANY
AUDITORS’ REPORT
The Board of Directors
Apollo Sindhoori Capital Investments Ltd.,
55, Greams Road, Ali Towers,
Chennai - 600 006.
Dear Sirs,
We have examined the following financial information of Apollo Sindhoori Capital
Investments Limited (the Company) annexed to this report, which is required to be prepared
in accordance with Clause B of Part II of Schedule II of the Companies Act, 1956 and the
Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000
(the SEBI Guidelines) issued by Securities and Exchange Board of India, (SEBI) in pursuance of
section 11 of the Securities and Exchange Board of India Act 1992. This financial information is
proposed to be included in the offer document of the Company in connection with its
proposed Rights Issue of equity shares of Rs.10 each at a premium of Rs.90 per share in the
ratio of 1:5.
1. The restated Profit and Loss account for the five financial periods ended on March 31,
2005, March 31 2004, March 31, 2003, September 30, 2001 and September 30, 2000 in
Annexure-I, the restated statement of Assets and Liabilities as at the five financial periods
ended on the aforesaid dates in Annexure-II and Cash Flow Statements for the five
financial periods ended on the aforesaid dates in Annexure-III together with Significant
Accounting Policies in Annexure-IV and Notes to the above restated accounts in
Annexure-V.
The above statements have been extracted from the financial statements of the company
for the respective periods, all of which have been audited by us, approved by the Board of
Directors and adopted by the members of the Company.
2.
The restated statement of consolidated Profit and Loss account of Apollo Sindhoori Capital
Investments Ltd with that of its subsidiary – Apollo Sindhoori Commodities Trading Ltd
for the year ended March 31, 2005 in Annexure-VI, the restated, consolidated Assets and
Liabilities of the above Companies as at March 31, 2005 in Annexure VII and restated
consolidated Cash Flow Statement of the above Companies for the year ended on the
aforesaid date in Annexure-VIII.
3.
In accordance with the Guidelines, we are also attaching the following:
a. Statement of Key Accounting Ratios in Annexure-IX
b. Capitalisation Statement in Annexure-X
c. Details of Dividend paid in Annexure-XI
d. Tax Shelter Statement in Annexure – XII
In our opinion, the financial information of the Company as attached to this report, as
mentioned in paragraph 1 and 2 above after making groupings/ adjustments have been
prepared in line with Clause B of Part II of Schedule II of the Companies Act, 1956 and the
SEBI Guidelines.
This report is intended solely for your information and inclusion in the letter of offer in
connection with the proposed Rights Issue of the Company and is not to be used, referred to or
distributed for any other purpose without our prior written consent.
FOR R.SUBRAMANIAN & COMPANY
CHARTERED ACCOUNTANTS
R.Rajaram
Partner
Membership No-25210
72
Annexure –I
Statement of Profit and Loss (as restated)
PARTICULARS
INCOME
Income from Operation
Dividend Income
Software Exp Written Back
Other Income
TOTAL (A)
EXPENDITURE
Operating & Other Expenses
Advertisement & Publicity
Bandwidth Charges
Business Promotion
Bad Debts Written Off
Clearing charges - F & O
Electricity
Employee cost
Legal & Professional Charges
Management Fee-Business
Partners
Postage & Telegrams
Printing & Stationery
Provision for Doubtful Debts
Rates & Taxes
Rent
Repairs & Maintenance
Telephone Exp
Transaction Charges
Travelling & Conveyance
Turnover Fees - SEBI
V-Sat Expenses
Trading Losses
Deferred Rev. Expenditure
w/off
Other Operating Exp
Depreciation
Interest & Financial Charges
TOTAL (B)
(Rs. Million)
12 Months 12 Months 18 Months 12 Months 12 Months
ended
ended
ended
ended
ended
31.3.05
31.3.04
31.3.03
30.9.01
30.9.00
381.52
0.03
2.53
384.08
233.10
0.21
2.14
235.45
95.36
0.12
2.64
98.12
55.00
0.37
2.28
57.65
114.65
0.91
32.04
147.60
5.54
7.18
2.39
6.08
6.35
4.58
37.52
4.70
1.96
8.47
2.26
2.82
5.94
3.54
27.75
3.76
0.90
1.68
0.48
3.27
24.30
1.46
0.30
1.67
2.20
18.49
1.35
0.55
0.62
22.00
1.47
18.57
1.21
125.56
9.84
6.74
4.91
6.24
12.77
6.43
6.29
9.02
3.29
1.50
-
53.74
4.80
4.14
3.42
5.29
9.40
4.73
2.06
6.71
0.84
1.14
-
10.57
1.28
1.94
1.01
6.43
3.61
4.83
1.76
4.74
0.34
-
0.96
1.76
2.64
0.68
3.28
3.86
4.50
1.47
3.56
0.62
-
1.03
1.91
1.79
0.91
2.79
2.02
3.68
3.17
3.68
1.48
0.36
3.85
6.03
19.96
10.70
303.62
4.82
13.21
8.38
179.18
5.29
9.84
6.68
90.41
7.63
5.26
5.15
4.94
70.32
7.07
6.06
3.24
9.12
96.58
Profit Before Tax (A-B)
80.46
56.27
7.71
(12.67)
51.02
Provision for Taxation
18.55
9.27
2.57
2.03
2.50
PROFIT AFTER TAX
Tax Adjustments relating to earlier years
Profit brought forward
Profit Available for Appropriation
Proposed Dividend - Equity
61.91
21.09
83.00
11.08
47.00
(1.68)
23.58
68.90
6.92
5.14
(6.22)
37.79
36.71
2.77
(14.70)
52.49
37.79
-
48.52
8.50
57.02
2.27
73
Tax on Dividend – Equity
Proposed Dividend - Preference
Tax on Dividend - Preference
Transfer to General Reserve
Balance Carried to Balance Sheet
1.55
0.02
0.01
40.00
30.34
0.89
40.00
21.09
0.36
10.00
23.58
37.79
0.23
2.03
52.49
74
Annexure –II
Statement of Assets and Liabilities (as restated)
As on
31.03.2005 31.03.2004
A) Fixed Assets
Gross Blocks
156.79
112.38
Less : Depreciation
53.85
33.91
Net Block
102.94
78.47
Capital Work-in-Progress
7.91
Less : Revaluation Reserve
Net Block after adjustment from
revaluation reserve
110.85
78.47
B) Current Loans and Advances
Inventories
S. Debtors
Cash and Bank Balance
Loans and advances
Other Current Assets
Total
C) Deferred Tax Liability
Total
D) Investments
E) Liabilities and Provisions
Secured and Unsec. Loans
Current Liabilities and Provisions
Total
Net worth
(A+B-C+D-E)
31.03.2003
(Rs. Million)
30.09.2001
30.09.2000
65.85
20.70
45.15
-
51.51
10.97
40.54
-
52.26
14.08
38.18
-
45.15
40.54
38.18
300.43
151.67
130.51
4.78
587.39
157.68
47.64
109.34
3.21
317.87
65.50
16.94
73.68
3.19
159.31
67.59
7.01
68.50
7.29
150.39
110.52
40.96
65.87
18.71
236.06
5.01
5.01
11.46
11.46
7.82
7.82
-
-
10.09
1.10
1.73
8.30
12.98
132.44
389.27
521.71
16.29
257.34
273.63
27.26
96.26
123.52
35.56
75.79
111.35
66.58
134.63
201.21
181.61
112.35
74.85
87.88
86.01
47.70
133.91
-
27.70
84.65
-
27.70
80.61
(33.46)
27.70
84.82
(24.64)
15.10
99.51
(28.60)
181.61
112.35
74.85
87.88
86.01
Represented By :
A. Share Capital
B. Reserves and Surplus
C. Deferred Revenue Expenditure
Net worth
75
Annexure –III
Cash Flow Statement (as restated)
PARTICULARS
12 Months
ended
31.3.05
12 Months
ended
31.3.04
18 Months
ended
31.3.03
12 Months
ended
30.9.01
80.46
56.27
7.71
(12.67)
(Rs. Million)
12 Months
ended
30.9.00
A Cash Flow from Operating Activities
Net Profit before Tax & Extraordinary items
Adjustments for:
Depreciation
(Profit)/ Loss on sale of investments
Loss on sale of Fixed Assets
Prov for Diminution in Value of Investments
and NPA
Interest and Finance Charges
Software expenses Written Back
Prior Period Adjustments
Interest / Dividend Received
Operating Profit before working Capital
Changes
Adjustments for:
Current Assets
Loans & Advances
Current Liability & Provisions
Increase in retirement benefits
Issue of Preference Share Capital
51.02
19.96
0.00
0.11
13.21
0.87
0.00
9.84
0.86
0.09
5.15
0.77
0.10
3.24
(29.33)
-
1.50
10.70
0.00
8.38
0.56
6.68
2.21
9.12
0.29
(1.34)
(0.44)
(1.47)
0.08
4.94
(8.00)
0.00
(1.17)
31.22
111.68
(158.35)
(21.16)
125.69
1.40
20.00
20.55
76.82
(105.28)
(35.66)
71.28
2.19
-
(32.42)
(1.27)
16.76
24.47
6.31
(5.18)
13.69
-
(67.47)
1.87
(10.80)
60.66
(2.63)
(60.87)
-
14.82
(2.47)
(17.23)
33.79
(50.35)
(39.58)
112.59
0.00
0.00
(2.84)
22.66
76
Cash Flow before Extra Ordinary Items
Adjustment for Deferred Revenue
Expenditure
NET CASH FLOW FROM OPERATING
ACTIVITIES
79.26
9.35
39.29
(13.64)
56.45
0.00
0.00
(8.83)
11.96
(0.44)
79.26
9.35
30.46
(1.68)
56.01
B Cash Flow from Investing Activities
Purchase of Fixed Assets
Fixed Deposits with Banks
Proceeds on Sale of Investments
Income from Investments - Interest &
Dividend
34.44
26.40
(9.50)
1.34
40.48
0.00
3.01
52.68
1.47
(12.60)
0.16
5.04
44.96
1.28
(13.98)
0.08
3.83
(6.12)
1.17
(88.90)
36.54
(8.90)
2.47
(49.89)
(23.37)
7.85
23.93
(9.12)
22.66
C Cash Flow from Financing Activities
Issue of Equity Shares
Secured Loans - Raised
Secured Loans-Repaid
Unsecured loans -Repaid
Dividend Paid
Interest Paid
(124.82)
8.68
6.86
(10.70)
(119.98)
NET CASH INFLOW / (OUTFLOW)
A+B+C
11.96
(2.90)
(15.08)
2.75
(8.38)
(23.61)
30.70
(2.67)
(5.06)
(6.68)
12.60
3.30
(34.33)
(14.41) (4.94)
9.93
(33.95)
28.78
77
Cash & Cash Equivalents at the beginning of
the year
Cash & Cash Equivalents at the end of the
year
Net increase/(Decrease) in cash & cash
equivalents
47.64
16.94
7.01
40.96
14.68
59.60
47.64
16.94
7.01
40.96
11.96
30.70
9.93
(33.95)
26.28
78
Annexure IV
SIGNIFICANT ACCOUNTING POLICIES
1.
SIGNIFICANT ACCOUNTING POLICIES:
The financial statements are prepared on historical cost convention. All expenses and income to
the extent considered payable and receivable, respectively, are accounted for on mercantile basis.
1.1
INCOME RECOGNITION
Brokerage income is recognised on settlement basis of National Stock Exchange and The Stock
Exchange, Mumbai.
1.2
FIXED ASSETS AND DEPRECIATION
Fixed assets are stated at historical cost less depreciation provided. Depreciation on fixed assets is
provided on straight-line basis, in accordance with the rates prescribed in Schedule XIV of the
Companies Act, 1956.
1.3
Lease Transactions
V-sat Equipments Purchased has been accounted for in the books as per the guidelines Provided
under Accounting Standard 19 issued by the Institute of Chartered Accountants of India.
1.4
INVESTMENTS
Current investments are stated at lower of cost and market value. Long term investments are
stated at cost and the diminution in the value of certain long term Investments, which in the
opinion of the management is permanent in nature, is provided for.
1.5
EMPLOYEE RETIREMENT BENEFITS:
Liability on account of encashment of leave and gratuity to employees is provided based on an
own internal valuation and not on the basis of actuarial valuation.
79
Annexure V
Notes To The Financial Statements
1)
Period of Financial Year:
The company adopted a period of 12 months from October to September as its Accounting Year
up to September 2001. A period of 18 Months from October 2001 to March 2003 was adopted
for the accounting period ended March 2003. Thereafter Financial Year, April to March has
been adopted as its accounting year.
2)
Scheme of Amalgamation:
a) The Honorable High Court of Madras in company petition No-538 of 200 sanctioned the
scheme of Amalgamation of Om Sindhoori Capital Investments Limited with Apollo
Sindhoori Capital Investments Ltd (the Company) as approved by the Shareholders at the
meeting held on 19th September 2001.
b) The assets and Liabilities of Om Sindhoori Capital Investments Limited, which was an
NBFC, were transferred to and vested with the Company at book values with effect from
the appointed date, viz., 01-10-99 in accordance with the scheme so sanctioned.
c) The scheme has accordingly, been given effect to in the accounts for the year ended 30-092000.
d) The amalgamation has been accounted for under the purchase method of accounting as
prescribed by the Accounting Standard 14 (AS-14) issued by the Institute of Chartered
Accountants of India.
e) The Assets and liabilities of the erstwhile company as at 01-10-1999 have been taken over at
book values.
f) Pursuant to the scheme, the company has allotted one share for every 10 Equity shares
held, to the shareholders of the erstwhile Om Sindhoori Capital Investments Limited.
g) The difference between the value of net assets acquired on amalgamation and the amount
of shares issued to the shareholders of Om Sindhoori Capital Investments Limited resulted
in Capital Reserve of Rs.450 Lacs.
h) Consequent to the scheme of amalgamation there was an increase in Share Capital by
Rs.50,00,000.
3)
Change in Accounting Policy:
The company had spent Rs.100 Lacs during the financial year 1999-2000 towards software
development charges. Consequent to the change in accounting policy in the financial year 20002001, the software expenses were treated as deferred revenue expenses and retrospectively
written off over a period of five years. The accounts have now been restated in accordance with
the revised accounting policy.
Contingent Liability:
4)
30th
30th
31st March 31st March 31st March
September September
2005
2004
2003
2001
2000
Rs. In Millions
I
Guarantees given to BSE, NSE &
ILFS
II
Disputed Income Tax Liability
Total
110.00
30.00
30.00
7.50
26.50
12.01
12.01
7.31
14.85
14.85
122.01
42.01
37.31
22.35
41.35
80
5) Related Party Disclosures:
Subsidiary:
Key Managerial Personnel:
Associates:
Apollo Sindhoori Commodities Trading Limited
Mr. P.B.Subramaniyan, Whole-Time Director
Apollo Hospitals Enterprise Limited*
30th
30th
31st March 31st March 31st March
September September
2005
2004
2003
2001
2000
Rs. In Millions
Subsidiary:
Investment in Share Capital
9.50
-
-
-
-
Loans Advances Paid
6.08
-
-
-
-
2.81
-
-
-
-
0.01
-
-
-
-
1.90
1.22
1.29
0.62
0.46
-
-
23.76
-
-
Amount receivable at the end of the
Year for Trading transactions
Amount due at the end of the year for
General advances
Key Managerial Personnel:
Remuneration Paid
Associates:
Inter-corporate Loan Received
(including interest)
* Ceased to be an associate subsequent to 2002-03
6)
Advance to Subsidiary Companies is as follows:
30th
30th
31st March 31st March 31st March
September September
2005
2004
2003
2001
2000
Rs. In Millions
Advance
0.01
-
-
-
-
Total
0.01
-
-
-
-
81
7)
Details of Investments held (Net of Provisions):
30th
30th
31st March 31st March 31st March
September September
2005
2004
2003
2001
2000
Rs. In Millions
Quoted
Cost
0.56
0.89
1.52
8.17
9.70
Market Value
1.61
0.99
1.46
7.50
11.30
9.53
0.21
0.21
0.13
3.28
Unquoted
Cost
8)
Details of Sundry Debtors is as follows:
30th
30th
31st March 31st March 31st March
September September
2005
2004
2003
2001
2000
Rs. In Millions
I
Over Six Months
Secured – considered good
-
-
-
-
Unsecured – considered good
27.26
14.25
10.20
10.26
11.93
- Considered doubtful
19.85
24.50
26.14
25.93
14.36
Total
47.11
40.80
36.35
36.19
26.29
2.98
5.29
5.29
5.29
2.26
44.13
35.51
31.06
30.90
24.03
Less: Provision for doubtful debts
Total
II
-
Others – Considered good
Secured
Unsecured
-
-
-
-
-
* 256.30
122.17
34.44
36.69
86.49
Total
256.30
122.17
34.44
36.69
86.49
TOTAL
300.43
157.68
65.50
67.59
110.52
* Due from Subsidiary Rs.2.81 Millions
82
9)
Details of Loans (Secured & Unsecured) is as follows:
Note
30th
30th
31st March 31st March 31st March
September September
2005
2004
2003
2001
2000
Rs. In Millions
Secured Loans:
Bank Overdrafts
a
19.26
From Corporates
b
100.51
7.58
Hire Purchase Loan / Lease
c
12.67
0.04
0.231
0.49
132.44
7.61
10.51
13.18
9.87
16.75
21.81
46.59
TOTAL
10.28
10.44
9.87
2.26
Unsecured Loans:
From Companies
-
From Banks
-
From Public
-
TOTAL
8.68
0.00
-
-
8.68
16.75
0.57
10.12
22.38
56.71
a. Secured by a pledge on Shares and charge on Fixed Assets / Fixed Deposits / Fixed Equipments.
Availed from Canara Bank, Bank of India and ICICI Bank.
b. Availed from ILFS, HCL Comnet Ltd., - Secured by a pledge of shares.
c. Secured on the hypothecation of respective assets.
10)
Major Components of (Deferred Tax Assets)/ Deferred Tax Liabilities:
30th
30th
31st March 31st March 31st March
September September
2003
2005
2004
2001
2000
Rs. In Millions
Timing Differences:
Depreciation
10.35
16.59
8.25
-
-
Deferred Revenue Expenditure
(2.19)
(3.04)
11.95
-
-
Lease Rentals
(3.15)
(2.09)
-
-
-
-
Losses Brought Forward
Total
(12.38)
5.01
11.46
7.82
83
11)
Reserves & Surplus comprise of:
30th
30th
31st March 31st March 31st March
September September
2005
2004
2003
2001
2000
Rs. In Million
Capital Reserve
11.54
11.54
45.00
45.00
45.00
General Reserve
92.03
52.02
12.03
2.03
2.02
Profit and Loss Account
30.34
21.09
23.58
37.79
52.49
133.91
84.65
80.61
84.82
99.51
Total
12)
Details of Lease Payments:
30th
30th
31st March 31st March 31st March
September September
2005
2004
2003
2000
2001
Rs. In Millions
Finance Lease:
Not Later than one year
5.82
6.40
-
-
-
More than a year and not later than
5.49
7.27
-
-
-
11.31
13.67
-
-
-
Not Later than one year
3.77
2.99
-
-
-
More than a year and not later than
7.42
3.22
-
-
-
Total
11.19
6.21
-
-
-
Grand Total
22.50
19.88
-
-
-
3 years
Total
Operating Lease:
3 years
13)
Segment Reporting:
The company is principally engaged in the business of Stock Broking and related activities.
Accordingly, there are no reportable segments as per Accounting Standard (AS) 17 issued by the
Institute of Chartered Accountants of India.
14)
Regroupings / Reclassifications:
Figures have been Regrouped / Reclassified wherever necessary, to conform to the restated
financial information.
84
Annexure VI
Consolidated Statement of Profit and Loss
(Rs. Million)
12 Months ended
31.3.05
PARTICULARS
INCOME
Income from Operation
Dividend Income
Software Expenses Written Back
Profit on Sale of Securities
Other Income
TOTAL (A)
EXPENDITURE
Operating & Other Expenses
Advertisement & Publicity
Bandwidth Charges
Business Promotion
Bad Debts Written Off
Clearing charges - F & O
Electricity
Employee cost
Entrance Fees
Legal & Professional Charges
Management Fee-Business Partners
Postage & Telegrams
Printing & Stationery
Provision for Doubtful Debts
Rates & Taxes
Rent
Repairs & Maintenance
Telephone Exp
Transaction Charges
Traveling & Conveyance
Turnover Fees - SEBI
V-Sat Expenses
Trading Losses
Deferred Rev. Expenditure w/off
Other Operating Exp
Depreciation
Interest & Financial Charges
TOTAL (B)
Profit Before Tax (A-B)
Provision for Taxation
PROFIT AFTER TAX
Tax Adjustments relating to earlier years
Prior Period Adjustments
Profit brought forward
382.28
0.03
0.49
2.53
385.33
5.54
7.25
2.39
6.08
6.35
4.58
37.52
4.70
125.57
9.84
6.75
5.69
6.24
12.76
6.43
6.34
9.02
3.30
1.50
6.31
20.26
10.71
305.13
80.20
18.59
61.61
21.09
85
Profit Available for Appropriation
Proposed Dividend - Equity
Tax on Dividend - Equity
Proposed Dividend - Preference
Tax on Dividend - Preference
Transfer to General Reserve
Balance Carried to Balance Sheet
82.70
11.08
1.55
0.02
0.00
40.00
30.04
86
Annexure VII
Statement of Consolidated Assets & Liabilities
(Rs. Million)
31.3.2005
As on
A) Fixed Assets
Gross Blocks
Less : Depreciation
Net Block
Capital Work-in-Progress
Less : Revaluation Reserve
Net Block after adjustment from
revaluation reserve
B)
Current Loans and Advances
Inventories
S. Debtors
Cash and Bank Balance
Loans and advances
Other Current Assets
Total
160.28
54.16
106.12
8.36
114.48
298.83
153.75
134.10
8.31
594.99
C) Deferred Tax Liability
Total
5.05
5.05
D) Investments
0.59
E)
Liabilities and Provisions
Secured and Unsec. Loans
Current Liabilities and Provisions
Total
Net worth
(A+B-C+D-E)
132.44
391.36
523.80
181.21
Represented By :
A. Shares Capital
B. Reserves and Surplus
C. Deferred Revenue Expenditure
Net worth
47.70
133.51
181.21
87
Annexure VIII
Consolidated Cash flow statement for the period ended 31.3.2005
PARTICULARS
A
Cash Flow from Operating Activities
Net Profit before Tax & Extraordinary items
Adjustments for:
Depreciation
Preliminary Exps. Written off
(Profit)/ Loss on sale of investments
Loss on sale of Fixed Assets
Prov for Diminution in Value of Investments
Prior Period Adjustments
Interest and Finance Charges
Interest / Dividend Received
Operating Profit before working Capital Changes
Adjustments for:
Current Assets
Loans & Advances
Current Liability & Provisions
Increase in retirement benefits
Issue of Preference Share Capital
B
C
(Rs. Million)
3/31/2005
Rs.
80.20
20.25
0.13
0.00
0.10
1.50
0.28
10.71
(1.34)
31.63
111.83
(159.76)
(21.17)
136.28
1.41
20.00
(23.24)
Cash Flow before Extra Ordinary Items
88.59
NET CASH FLOW FROM OPERATING ACTIVITIES
88.59
Cash Flow from Investing Activities
Purchase of Fixed Assets
Fixed Deposits with Banks
Investments in Subsidiary
Income from Investments - Interest & Dividend
Cash Flow from Financing Activities
Secured Loans-Repaid
Unsecured loans –Repaid
Dividend Paid
Interest Paid
NET CASH INFLOW / (OUTFLOW)
Cash & Cash Equivalents at the beginning of the year
Cash & Cash Equivalents at the end of the year
Net increase/(Decrease) in cash & cash equivalents
34.43
26.40
(0.50)
1.34
61.67
(124.83)
8.68
6.90
(10.71)
(119.96)
30.30
31.38
61.68
30.30
88
Annexure IX
Key Accounting Ratios
12
12
18
Months Months Months
ended
ended
ended
PARTICULARS
31.3.05 31.3.04 31.3.03
Earnings per Share (EPS) Rs.
22.34
16.97
1.86
Net Asset Value per Equity Share (NAV) Rs.
58.34
40.56
27.02
Return on Net Worth
34.09% 41.83%
6.87%
Net Worth (Rs. in Million)
181.61
112.35
74.85
Profit After Tax (Rs. in Million)
61.91
47.00
5.14
No. of Equity Shares
2770000 2770000 2770000
12
12
Months Months
ended
ended
30.9.01 30.9.00
(5.31)
48.04
31.73
85.16
-16.73% 56.41%
87.88
86.01
(14.70)
48.52
2770000 1510000
Annexure X
Capitalization statement
(Rs. Million)
Pre Issue
as at
As adjusted
31.3.05
for Issue
Details
Debt
Short Term Debt
Long Term Debt
Total Debt
Shareholders' Fund
Share Capital - Equity
Share Capital - Preference
Share Premium
Reserves
Total Shareholders' Fund
Long Term Debt / Equity ratio
119.77
12.67
132.44
119.77
12.67
132.44
27.70
20.00
133.91
181.61
6.98%
33.24
20.00
49.86
133.91
237.01
5.35%
Annexure XI
Details of Dividend paid
12
12
Months Months
ended
ended
31.3.05
31.3.04
PARTICULARS
On Equity Shares
No. of Shares
Rate of Dividend
Amount of Dividend ( Rs. in Million)
2770000
40%
11.08
On Preference Shares
No. of Shares
Rate of Dividend (Pro rata)
Amount of Dividend ( Rs. in Million )
200000
10%
0.02
2770000
25%
6.92
-
18
Months
ended
31.3.03
2770000
10%
2.77
-
12
Months
ended
30.9.01
2770000
-
-
12
Months
ended
30.9.00
1510000
15%
2.27
-
89
Annexure XII
Tax Shelter Statement
PARTICULARS AS ON
31.3.05
31.3.04
31.3.03
30.3.02
(Rs. Million)
30.3.01
30.3.00
Tax rate (including Surcharge
and Education Cess)
Restated Net Profit before Tax
Tax at actual rate on Profit
36.60%
80.46
29.45
35.88%
56.28
20.19
36.75%
12.50
4.59
35.70%
(6.93)
(2.47)
39.55%
23.04
9.11
38.50%
25.43
9.79
(0.03)
0.11
0.18
0.50
0.59
(0.11)
0.00
0.06
0.00
0.16
0.09
0.15
0.02
0.08
0.24
0.11
0.58
(0.87)
0.04
0.13
0.20
0.19
(9.90)
(10.21)
(0.18)
1.35
(0.07)
0.00
0.01
0.56
0.29
(0.24)
0.55
0.70
0.89
0.26
0.28
(0.02)
0.11
0.71
(7.18)
0.00
0.80
(1.83)
0.00
0.00
0.00
0.00
0.00
0.00
0.00
(11.99)
(3.53)
(15.23)
(2.31)
0.00
0.00
0.53
1.79
(7.77)
(6.16)
(0.01)
0.00
(14.25)
(12.90)
(4.72)
24.73
(16.68)
(0.01)
(26.37)
(43.20)
(43.09)
(15.46)
4.73
(4.78)
(0.01)
(7.43)
(11.96)
(11.41)
(4.19)
0.40
(5.79)
(0.01)
(7.61)
(0.01)
(3.30)
(12.68)
(22.89)
(9.05)
0.06
(3.06)
(0.01)
Adjustments
Permanent Differences
Dividend Income
Loss on Sale of Fixed Assets
Donation
Provision for Diminution
Other Adjustments
Capital Gains
Subtotal (A)
0.25
0.23
0.30
Timing Differences
Provision for Gratuity
Provision for Leave Encashment
Lease Rental Payments
Deferred Revenue Expenditure
Provision for Bad Debts Written
off
Difference Depn. between book
and Income Tax
Preliminary Exps.
Brought Forward Loss Adjusted
Sub-Total (B)
Net Adjustments (A+B)
Total Tax Shelters
Total Taxation
MAT Tax Payable
0.87
(16.98)
(16.40)
(5.85)
(8.33)
(25.96)
(25.66)
(9.88)
(0.09)
2.03
Note: The Company's financial periods differ from the taxation periods. The above tax shelter
statement has however been prepared based on the information from Income Tax computations
made for the purpose of tax returns for each of the above individual years and not based on
assessed income.
90
MANAGEMENT DISCUSSION AND ANALYSIS OF THE FINANCIAL PERFORMANCE
Shareholders should read the following discussion of the company’s financial condition and results of
operations together with audited financial statements including the notes thereto and the reports thereon,
which appear elsewhere in this Letter of Offer .The following discussion is based on audited financial
statements for the period ending 30.9.2000 (12 months), 30.9.2001 (12 months), 31.3.2003 (18 months),
31.3.2004 (12 months), 31.3.2005 (12 months), which have been prepared in accordance with Indian
GAAP, and on information available from other sources. Unless otherwise indicated, all financial and
statistical data relating to the broking industry in the following discussion are derived from various
industry reports.
Overview
a. Financial
PARTICULARS
(Rs. Million)
12
Months
ended
30.9.00
12
Months
ended
31.3.05
12
Months
ended
31.3.04
18
Months
ended
31.3.03
12
Months
ended
30.9.01
Income
384.08
235.45
98.12
57.65
147.6
Operating & Other Expenses
Operating Profit
272.96
111.12
157.59
77.86
73.89
24.23
60.23
-2.58
84.22
63.38
Depreciation
Interest & Financial Charges
Profit Before Tax
19.96
10.7
80.46
13.21
8.38
56.27
9.84
6.68
7.71
5.15
4.94
-12.67
3.24
9.12
51.02
Provision for Taxation
Profit After Tax
18.55
61.91
9.27
47
2.57
5.14
2.03
-14.7
2.5
48.52
Millions
Chart showing growth of Total income and Profit After Tax
0.00045
TOTAL INCOME
PROFIT AFTER TAX
0.0004
0.00035
0.0003
0.00025
0.0002
0.00015
0.0001
0.00005
0
-0.00005
12 Months ended 12 Months ended 18 Months ended 12 Months ended 12 Months ended
30.9.00
30.9.01
31.3.03
31.3.04
31.3.05
91
b. Other Performance measures
Chart showing growth in number of customers
50,000
40,000
30,000
20,000
10,000
2002
2003
2004
2005
Chart showing growth in network, including owned branches and franchisees
400
350
300
250
200
150
100
50
0
2002
2003
2004
2005
Income
Income from operations denotes income from broking, which constituted 99.3% of the total
income in FY 2004-05.
Other income of the Company mainly comprises Interest and dividend income
Expenditure
Operating expenses mainly comprise staff cost, management fee (franchisees) and administration
and operating cost like rent charges, printing, electricity, etc incurred in normal course of
business.
Comparison of significant items of income and expenses for the financial year ended March
31, 2005 and the financial year ended March 31, 2004
The total income and net profit of ASCIL have grown at 63% and 32% respectively during the
period. During the year the network increased to 343, including owned branches and franchisees.
This growth has been achieved due to expansion of branches, increase in the number of clients
and positive stock market performance.
Our volumes have gone up by 28% taking our market share from 0.9% to 1.01% as compared to
the exchange volume growth of 14%. (Source: www.nse-india.com)
92
During the year, our subsidiary company, Apollo Sindhoori Commodities Trading Limited
started its expansion through the branches of ASCIL and now they are operating from 100
locations. There are three different sets of commodities that are being traded in the exchange viz.,
Precious metals (Gold and Silver), Base Metal (Steel and Ingot) and Agricultural commodities
under which there are about 38 items that are being traded.
Comparison of significant items of income and expenses for the financial year ended March
31, 2004 and the Eighteen-month period ended March 31, 2003
The total income and net profit of ASCIL have grown at 140% and 814% respectively during the
period. During the year, the network increased by 141 to 237. The increase in number of clients
registered was 13,488 in FY 2004. The stock market turnover picked up in the last 6 months as the
Sensex reached the 6000 mark for the first time in the history in January 2004. Improved
corporate profitability, a weakening dollar, strong FII inflow and good monsoon led to positive
sentiments among both retail and institutional investors.
During this period the exchange volume has gone up by 205% and our volume has gone up by
222% thereby raising our market share to 0.9%. The earnings through the franchisee model have
more than trebled.
The company focused on quality of operations by providing support to franchisees through
regular interaction, periodical visits and update on technology front etc.
During the year, the company formed a wholly owned subsidiary for participating in the
commodities segment. The subsidiary acquired membership of National Commodities and
Derivatives Exchange of India Limited and commenced business.
Comparison of significant items of income and expenses for the Eighteen-month period ended
March 31, 2003 and the year ended September 30, 2001
The total income and net profit of ASCIL increased at 70% and 135% respectively during the
period. During the year, the network increased by 52 taking the total to 96 offices which included
13 branches. The increase in number of clients registered was 1800 during this period. With the
increase in number of offices and clients, the volumes of the company started increasing.
Comparison of significant items of income and expenses for the year ended September 30,
2001 and year ended September 30, 2000
The total income and net profit of ASCIL reduced by 61% and 130% respectively during the
period. During the year the company has added 26 offices taking the total to 13 branches and 31
branches on partnership basis. The increase in number of clients registered was 500 during this
period. The decline in stock market was the main factor affecting the operations of the company.
The company has completed centralization of entire systems, integration of order routing system,
risk management system, system administration, depository and back office operations, thereby
enabling trading in equity segment of both BSE and NSE and Derivatives segment through
ASCIL’s satellite network.
93
OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS
Except as described below, there are no outstanding litigation, suits or criminal or civil prosecutions,
proceedings or tax liabilities against our Company, our Directors, our Promoters or group companies and
there are no defaults, non payment of statutory dues, over dues to banks/ financial institutions, defaults
against banks/ financial institutions, defaults in dues payable to holders of any debentures, bonds or fixed
deposits, issued by our Company (including past cases where penalties may or may not have been awarded
and irrespective of whether they are specified under paragraph (i) of part 1 of Schedule XIII of the
Companies Act, 1956).
I. Outstanding litigation and contingent liability details of ASCIL
A. Contingent liabilities not provided for as on 31.3.2005:
Disputed tax liability not provided for - Rs. 12.0 Million including Income tax of Rs. 11.7 Million
and Interest Tax – Rs. 0.3 Million.
B. Litigation / Disputes involving Securities Related Offence, including penalties imposed by
SEBI or any other securities market regulator in India or abroad:
ASCIL has filed two writ petitions against SEBI and NSE for the issue of show cause notices. The
company has obtained stay of operation of the show cause notices.
Current status.
S. Princip Place &
Charges and allegation.
Amount
Ref
N
al
Court of
Involved
no.
o
parties Institutio
of
n
the
case.
1
ASCIL
–VsSEBI.
High
Court
Madras
2
ASCILVsSEBI
and
NSE.
High
Court
Madras
SEBI issued a show cause
notice to ASCIL on 14.10.2003
based on the report of Enquiry
officer. The enquiry officer has
recommended a penalty under
Regulation 13 (1) (a) (iv) of
SEBI (Procedure for Holding
Enquiry by Enquiry Officer
and
Imposing
Penalty)
regulations, 2002.
NSE called upon ASCIL to
pay the turnover fee as
determined by SEBI vide
letter dated 15.3.2005. The
additional registration
number was allotted to
ASCIL without its knowledge
and this number has not been
used by ASCIL.
Extent of
liability on
account of
penalty
imposed by
SEBI is not
quantifiable
Rs. 26.1
Million
WP.
No.
31065
of
2003.
Stay granted by
Hon’ble
High
Court of Madras
on 6.11.2003. SEBI
has
filed
its
counter
on
22.1.2004.
The
case is to be listed
for hearing.
W.P.
No.9
973
of
2005.
Stay granted by
Hon’ble High
Court of Madras
on 24.3.2005.
NSE to file its
counter.
94
C. Litigation involving statutory and other offence, including penalties imposed by any
regulatory authority in India or abroad
Penalties imposed by NSE
1. Penalty on account of short reporting of client level margin
Date on which penalty was levied
14.1.2004
27.2.2004
12.5.2004
17.5.2004
18.5.2004
19.5.2004
Amount
Rs. 67,100
Rs. 21,500
Rs. 17,640
Rs. 23,759
Rs. 18,537
Rs. 14,614
2. Penalty on account of short reporting of client level margin
Period for which penalty was levied
Quarter – 31.3.2004
Quarter – 30.6.2004
Quarter – 30.9.2004
Quarter – 31.12.2004
Quarter – 31.3.2005
Quarter – 27.5.2005
Amount
Rs. 5,000
Rs. 5,000
Rs. 5,000
Rs. 5,000
Rs. 5,000
Rs. 5,000
3. Penalty on account of gross exposure violation
Period for which penalty was levied
January 2004
April 2004
December 2004
Amount
Rs. 30,000
Rs. 5,000
Rs. 10,000
4. Penalty on account of short delivery etc.
Penalty under this head levied on various dates amounted to Rs. 1,80,517/D. Litigation involving Civil Offence
Date
of
Institu
tion
9-52003
Principal Place & Court Charges and allegation
Parties
of Institution
ASCIL –
VsSripathy
Enterpris
es by its
proprieto
r Mr. S.
Ram
Reddy
Chennai
before
the
Learned
Arbitrator Mr.
V. Inbavijayan
ASCIL appointed Mr. S.
Ram Reddy to manage
the Saifabad Branch, he
committed a breach of
the
Agreement
&
therefore
ASCIL
initiated
arbitration
proceedings to recover
compensation for loss of
profits and for damages
for the breach including
interest.
Ref
num
ber
Current
Status
AM
No.1
of
2003
Enquiry
Claimed
amount
/
Liability
contemplated
Rs.
5,81,964/-.
Counter
claim
by
the
Respondent Rs.
10,53,000/-
E. Litigation involving revenue authorities (custom/excise/ sales tax/ income tax/ service tax)
95
List of pending Income tax cases is given below:
S.
Assessment
Nature of Disputes
No
year
1
1993-94
Depreciation disallowance
on film negative leased.
Amount Rs.
Rs.6,65,515
2
1996-97
Depreciation disallowance
on furnace leased.
Rs.105, 00,000
3
1997-98
Depreciation disallowance
on various assets to different
parties.
Rs.48, 24,065
4
1998-99
Depreciation disallowance
on various assets to different
parties.
Rs.48, 24,065
5
1997-98/
1998-99
Appeal filed by Tax Dept
against CIT (Appeals) Order
in our favour in the matter of
interest tax on Hire Purchase
Finance Charges
Rs.2, 06,87,224
Total
Tax thereon
Latest
Position
2,90,556/- Appeal
remanded
by High
Court to
ITAT
Chennai.
Rs.49, 50,777 Appeal
remanded
by High
Court to
ITAT
Chennai.
Rs.16, 68,473 Appeal
pending
before ITAT,
Chennai
Rs.16, 88,423 Appeal
pending
before ITAT,
Chennai
Rs.3, 39,142 Income Tax
Dept appeal
pending
before ITAT,
Chennai
Rs.89, 37,371
II. Outstanding litigation details of directors
There is a civil suit pending before the High Court relating to ancestral property against Mr. S.
Narayanan. The maximum liability contemplated is Rs. 2 Million.
III. Outstanding litigation details of group companies
A. Apollo Hospitals Enterprise Limited (AHEL)
The company has 42 civil offences filed against it, the monetary value of which amounts to Rs. 70
Million. Most of these cases have been filed in the District Consumer Forum and State Consumer
Commission of Chennai.
B. The Lanka Hospital Corporation Limited (LHCL)
There are four civil cases filed against LHCL, the monetary value of which amounts to SLR 47.3
Million i.e. Rs. 21.2 Million (Exchange rate: 1 Re = 0.4475 Sri Lanka Rupees on 14.12.2005)
C. Indraprastha Medical Corporation Limited (IMCL)
There have been 83 civil cases filed against IMCL, the monetary value of which amounts to Rs.
394.6 Million
96
There are also three labour litigations filed against IMCL by the Apollo Hospital Employees
Union. The liability is not quantifiable.
D. Apollo Gleneagles Hospital Limited (AGHL)
The details of cases filed against AGHL are given below. The total liability contemplated in
respect of the cases to the extent quantifiable is Rs. 24.6 Million.
(i) Mr. Pradeep Kr. Sarkar Vs. State of West Bengal & Others
WP No. 19625 of 1998 - The aforesaid Writ Application was filed in the year 1998 upon
service to various respondents including AGHL. In March 2000, the matter was assigned
before Hon’ble Justice Mr. Bhaskar Bhattacharya. Upon hearing the submissions made by
the respective parties, the Hon’ble Justice Mr. Bhaskar Bhattacharya declined to pass any
interim order and direction for filing Affidavit was given. The Affidavit-in-Opposition was
duly filed. The matter is still pending and the liability is not quantifiable.
(ii) Smt. Dhira Mitra Vs. State of West Bengal & Others
Mat No. 2424 of 1998 - The aforesaid proceeding was filed by Smt. Dhira Mitra before the
Hon’ble High Court, inter alia, claiming the portion of the land on which the Hospital is
constructed. The appeal was remanded by the Hon’ble Division Bench (presided over by
Hon’ble Justice Mr. Satyabrata Sinha) before the Ld. Single Judge to re-hear the entire Writ
application. The matter is pending for hearing before the Ld. Single Judge and the liability is
not quantifiable.
(iii) Legal Heirs of Smt. Daisy Mantosh Vs. State of West Bengal & Others
TS 101 of 1998 – Late Smt. Daisy Mantosh had filed a case at Sealdah Court claiming title of
73 Canal Circular Road, which is one of the plots on which the Hospital is constructed. The
matter appeared for Parental Hearing (PH) before the trial judge. The Ld. Court has heard
the defendants and plaintiff’s arguments at length on various dates concluding on April
7,2005. The Ld. Court is expected to pass its order in connection with the maintainability
point under Order 7, Rule 11 of CPC. The maximum liability contemplated in this litigation is
Rs. 20 Million.
(iv) Sri Somnath Chakraborty Vs. State of West Bengal & Others
Mr. Somnath Chakraborty, the Petitioner filed a case at the Hon’ble High Court (C.O. No.
8616 (W) of 1993) against the State of West Bengal claiming to be the absolute owner of Plot
No. 59, measuring an area of 5 cottahs 13 chittaks and 12 ½ sq.ft. On 2.5.2005, Justice Pratap
Kr. Roy delivered his judgment allowing the Writ petition. Memo of Appeal and stay
application has been filed by AGHL and State of West Bengal. The matter is appearing
before the Divn. Bench presided over by the Chief Justice and was partly heard on 5th, 7th, 13th
and 26th of September 2005. The maximum liability contemplated is not quantifiable.
(v) Datex Ohmeda (India) Pvt. Ltd. Vs. Duncan Gleneagles Hospital Limited.
A letter of termination was issued to M/s. Datex Ohmeda on 12 June 2000 due to
incompletion of work as per the Work Order dated 1 June 1995 for Rs.2,62,69,200/- for
completion of Medical Gas System to commission the entire system by 21April 2000. On 18
August, 2000, M/s. Datex Ohmeda filed a suit (Civil Suit No. 311 of 2000) at the Hon’ble
High Court claiming a Decree for Rs.15,76,000/-. In reply to the Decree, DGHL has filed a
Written Statement on 19.1..2001 before the Hon’ble High Court and the matter is pending.
The maximum liability contemplated is Rs. 1.58 Million.
97
(vi) Mr. Ramendra Sundar Sarkar Vs. Dr. Purnendu Roy, Duncan Gleneagles Hospital Ltd. And
Mr. G. P. Goenka.
Mr. Ramendra Sundar Sarkar, one of the patients, filed a damage suit in the Consumer
Forum for Rs.25 lacs against Dr. Purnendu Roy as prime accused, Mr. Bill Shields, the then
COO of DGHL and Mr. G. P. Goenka, the then Chairman of Duncan Group of Industries. The
matter is under the purview of Consumer Dispute Redressal Forum (Consumer Case No:
STC 164 of 1998) and is posted for hearing on 7th and 8th of November 2005. The maximum
liability contemplated is Rs. 2.5 Million.
(vii) Mr. Susanta Biswas Vs. Apollo Gleneagles Hospital Ltd.
Mr. Susanta Biswas, who was terminated from his services on the ground of misconduct,
instituted a Suit (TS 26 of 2002) against the Company on 2.9.2002. The judgment in
connection with the grant of the Interim Relief petition was in the favour of AGHL and the
Applicant’s petition was rejected. The application under the Industrial Disputes Act is still
pending before the Ld. 2nd Labour Court. The maximum liability contemplated is not
quantifiable.
(viii) Employees’ State Insurance Corporation (ESI) Vs. Apollo Gleneagles Hospital Ltd. – V.P No.
992 of 2000
The ESI Authorities vide their letter dated 1.12.1998 informed AGHL that the hospital was
treated as covered under the ESI Act, 1948 w.e.f. 2.10.1997 and advised AGHL to submit
declaration forms in respect of all employees who were in employment. A Show Cause
Notice was also issued against AGHL.
AGHL filed a writ petition before the Hon’ble High Court at Calcutta. The Hon’ble High
Court quashed ESI’s application and allowed the writ petition on 29.8.2003.
An appeal has been preferred by the ESI Corporation against the order. The appeal came up
for hearing before the Division Bench and the hearing has been concluded. The judgment has
been kept reserved. The maximum liability contemplated is Rs. 0.5 Million.
The company is yet to receive a certified copy of the judgment.
(ix) AGHL Vs. CESC Ltd. – W.P. No. 1112 of 2005
CESC raised arrears of tariff with retrospective effect from April 2000 in the electricity bill for
the month of August 2004. AGHL paid the bill under protest and filed a writ petition before
the Hon’ble High Court at Kolkata on 10.5.2005. The company preferred an appeal on
15.6.2005. The matter is pending. AGHL has also filed a complaint petition before the Ld.
West Bengal Electricity Regulatory Commission, which is yet to appear for hearing. The
maximum liability contemplated is not quantifiable.
REGULATORY APPROVALS
The Company has received all the necessary consents, licences, permissions and approvals from
the Government and various Government agencies / private certification bodies required for its
present business and no further approvals are required for carrying on the present as well as the
proposed business of the Company except as stated elsewhere in this Draft Letter of Offer. It
must, however, be distinctly understood that in granting the above consents/ licences/
permissions/ approvals, the government does not take any responsibility for the financial
soundness of the Company or for the correctness of any of the statements or any commitments
made or opinions expressed.
The Company has received the following approvals/licenses/permissions:
98
•
•
•
•
•
•
•
•
•
•
•
Permanent Account Number AAACA 7472 K dated 28.11.1997
Service Tax Code Number SB/MADRAS/275/STC dated 7.8.2002
Tax deduction Account Number CHEA02673G dated 24.4.1998
Registration (No. INB230825534) with SEBI under the SEBI (Stock Brokers and Sub Brokers
Regulations), 1992, as Member for Capital Market segment on the National Stock Exchange,
dated 22.11.1995. The certificate is valid till it is suspended or cancelled in accordance with
the regulations.
Registration (No. INF231053936with SEBI under the SEBI (Stock Brokers and Sub Brokers
Regulations), 1992, as Trading Member for Futures and Options Segment on the National
Stock Exchange, dated 25.5.2000. The certificate is valid till it is suspended or cancelled in
accordance with the regulations.
Registration (No. INB010825538) with SEBI under the SEBI (Stock Brokers and Sub Brokers
Regulations), 1992, as Multiple Member on the Stock Exchange, Mumbai dated 10.11.2000.
The certificate is valid till it is suspended or cancelled in accordance with the regulations.
Registration (No. INF010825538) with SEBI under the SEBI (Stock Brokers and Sub Brokers
Regulations), 1992, as Trading Member on the Stock Exchange, Mumbai dated 2.6.2004. The
certificate is valid till it is suspended or cancelled in accordance with the regulations.
Registration (No. IN-DP-NSDL-141-2000) with SEBI under the SEBI (Depositories and
Participants) Regulations, 1996, as participant dated 22.9.2005. The certificate is valid till
25.5.2010 unless renewed.
Registration (No. IN-DP-CSDL-254-2004) with SEBI under the SEBI (Depositories and
Participants) Regulations, 1996, as participant dated 23.6.2004. The certificate is valid till
22.6.2009 unless renewed
Registration (Code No. TN 31526) under the Employees’ Provident Funds and Miscellaneous
Provision Act, 1952 dated 18.1.2000
Registration under the Employees State Insurance Act, 1948 and allotment of factory code no
51-51980-101 of the Employees’ State Insurance Corporation, Tamil Nadu dated 12.11.1997.
The certificate is in the name of Om Sindhoori Capital Investments Ltd.
ASCIL has received approvals for registration under the Shops and Establishment Act for 35
branches out of 68. The Company is in the process of applying for registration of 16 branches.
The Company has applied for but is yet receive the following renewal for 17 branches.
99
TERMS OF THE PRESENT ISSUE
The company is offering on a rights basis through this Letter of Offer, 5,54,000 Equity Shares of
Rs. 10 each at a premium of Rs. 90 per share aggregating Rs. 55.4 Million. The Equity Shares,
now being issued, are subject to the terms and conditions contained in this Draft Letter of Offer,
the enclosed Composite Application Form (“CAF”), the Memorandum and Articles of
Association of the Company, approvals from the RBI, the provisions of the Act, guidelines issued
by SEBI, guidelines, notifications and regulations for issue of capital and for listing of securities
issued by Government of India and/or other statutory authorities and bodies from time to time,
terms and conditions as stipulated in the allotment advice or letter of allotment or security
certificate and rules as may be applicable and introduced from time to time.
AUTHORITY FOR THE ISSUE
This offer of equity shares is being made pursuant to the resolution passed by the Board of
Directors under section 81 (1) of the Act on July 18,2005 in the ratio of 1 equity share of Rs. 10/each for every 5 shares held on the Record date (i.e. ______ , 2006) at a premium of Rs. 90/- per
share. The resolution for the rights issue was passed by the shareholders at the Annual General
Meeting on 9th September 2005.
BASIS OF OFFER
In accordance with the Board resolution and shareholders resolution referred to above, equity
shares are being offered on Rights basis in the ratio of 1 equity share of Rs. 10/- each for every 5
equity shares of Rs. 10/- each at a premium of Rs. 90/- per share to all the existing equity
shareholders whose names appear as beneficial owner as per the list to be furnished by
depositories in respect of the shares held in electronic form and on the Register of Members of the
company in respect of the shares held in physical form at the close of business hours on the
Record date fixed in consultation with MSE. Such shareholders are entitled to apply for equity
shares on rights basis.
PRINCIPAL TERMS AND CONDITIONS OF THE ISSUE
FACE VALUE
Each Equity share shall have the face value of Rs.10/-.
Issue Price
Each Equity Share is being offered at a price of Rs.100/- (including premium of Rs.90).
RIGHTS ENTITLEMENT
As your name appears as beneficial owner as per the list to be furnished by depositories in
respect of the shares held in electronic form and on the Register of Members of the company in
respect of the shares held in physical form as an equity shareholder on the Record date (i.e.
________, 2006), you are offered equity shares as shown in Part A of the enclosed Composite
Application Form.
The Equity Shares are being offered on right basis to the existing Equity Shareholders of the
company in the ratio of one Equity Share for every 5 Equity Shares held as on Record Date.
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Market lot
The Equity Shares of the Company are tradable only in dematerialized form. The market lot for
Equity Shares in dematerialized mode is one. In case of holding in physical form, the Company
would issue to the allottees one certificate for the Equity Shares allotted to one folio
("Consolidated Certificate"). In respect of the Consolidated Certificate, the Company will, upon
receipt of a request from the Equity Shareholder, split such Consolidated Certificate into smaller
denomination within one week's time from the request of the Equity Shareholder. No fee would
be charged by the Company for splitting the Consolidated Certificate.
Nomination Facility
In terms of Section 109A of the Act, nomination facility is available in case of Equity Shares. The
applicant can nominate any person by filling the relevant details in the CAF in the space
provided for this purpose. A sole Equity Shareholder or first Equity Shareholder, along with
other joint Equity Shareholders being individual(s) may nominate any person(s) who, in the
event of the death of the sole holder or all the joint holders, as the case may be, shall become
entitled to the Equity Shares. A Person, being a nominee, becoming entitled to the Equity Shares
by reason of the death of the original Equity Shareholder(s), shall be entitled to the same
advantages to which he would be entitled if he were the registered holder of the Equity Shares.
Where the nominee is a minor, the Equity Shareholder(s) may also make a nomination to
appoint, in the prescribed manner, any person to become entitled to the Equity Share(s), in the
event of death of the said holder, during the minority of the nominee. A nomination shall stand
rescinded upon the sale of the Equity Share by the person nominating. A transferee will be
entitled to make a fresh nomination in the manner prescribed. When the Equity Share is held by
two or more persons, the nominee shall become entitled to receive the amount only on the
demise of all the holders. Fresh nominations can be made only in the prescribed form available
on request at the registered office of the Company or such other person at such addresses as may
be notified by the Company. The applicant can make the nomination by filling in the relevant
portion of the CAF. Only one nomination would be applicable for one folio. Hence, in case the
Equity Shareholder(s) has already registered the nomination with the Company, no further
nomination needs to be made for Equity Shares to be allotted in this Issue under the same folio.
In case the allotment of Equity Shares is in dematerialised form, there is no need to make a
separate nomination for the Equity Shares to be allotted in this Issue. Nominations registered
with respective DP of the applicant would prevail. If the applicant requires to change the
nomination, they are requested to inform their respective DP.
Minimum Subscription – If the Company does not receive the minimum subscription of 90% of
the Issue, the entire subscription shall be refunded to the applicants within forty-two days from
the date of closure of the Issue. If there is a delay in the refund of subscription by more than eight
days after the Company becomes liable to repay the subscription amount, i.e. forty-two days after
closure of the Issue, the Company will pay interest for the delayed period, at the rates prescribed
in sub-sections (2) and (2A) of Section 73 of the Act. The Issue will become under subscribed after
considering the number of shares applied as per entitlement plus additional shares.
Subject to the provisions contained in this Draft Letter of Offer, the Articles of Association of the
Company and the approval of the Designated Stock Exchange, the Board will proceed to allot the
Equity Shares in the following order of priority:
(a) Full allotment to those Equity Shareholders who have applied for their rights entitlement
either in full or in part and also to the renounce(s) who has/ have applied for Equity Shares
renounced in their favour, in full or in part.
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(b) If the shareholding of any of the Equity Shareholders is less than five or is not in multiples of
five, then the fractional entitlement of such holders for Equity Shares shall be ignored. Equity
Shareholders whose fractional entitlements are being ignored would be given preferential
allotment of ONE additional Equity Share each if they apply for additional shares.
(c) Allotment to the Equity Shareholders who having applied for all the Equity Shares offered to
them as part of the Issue and have also applied for additional Equity Shares. The allotment of
such additional Equity Shares will be made as far as possible on an equitable basis having due
regard to the number of Equity Shares held by them on the Record Date, provided there is an
undersubscribed portion after making full allotment in (a) above. The allotment of such Equity
Shares will be at the sole discretion of the Board/Committee of Directors in consultation with the
Designated Stock Exchange, as a part of the Issue and not preferential allotment.
(d) Allotment to the renouncees who having applied for the Equity Shares renounced in their
favour have also applied for additional Equity Shares, provided there is an under-subscribed
portion after making full allotment in (a) and (b) above. The allotment of such additional Equity
Shares will be made on a proportionate basis at the sole discretion of the Board/ Committee of
Directors but in consultation with the Designated Stock Exchange, as a part of the Issue and not
as a preferential allotment.
After taking into account allotment to be made under (a) and (b) above, if there is any
unsubscribed portion, the same shall be deemed to be ‘unsubscribed’ for the purpose of
regulation 3(1)(b) of the Takeover Code which would be available for allocation under (c) and (d)
above. The Promoter and the promoter group intend to subscribe to unsubscribed portion if the
Issue does not have subscription to the extent of 90% of the Issue size, after considering the above
allotment, to ensure that the Issue is successful. The allotment of additional Equity Shares to the
Promoter over and above its Entitlement in this Issue will not result in change in management or
control of the Company and shall be done in compliance with Clause 40A of the Listing
Agreement and the other applicable laws prevailing at that time.
In terms of proviso to regulation 3(1)(b)(ii) of the Takeover Code, acquisition of additional equity
shares in a rights issue, in the event of undersubscription of the issue, by any person presently in
control of the company, will be exempt from the applicability of regulation 11 and 12 of Takeover
Code. Further, in order for the exemption to be applicable, the person presently in control of the
company should make a disclosure of its intension to acquire additional Equity Shares in the
Draft Letter of Offer/Letter of Offer and the acquisition should not result in change of control of
management of the company.
Fractional Entitlement - If the shareholding of any of the Equity Shareholders is not in multiples
of five, then the fractional entitlement of such holders shall be ignored. Equity Shareholders
whose fractional entitlements are being ignored would be given preferential allotment of ONE
additional Equity Share each if they apply for additional shares.
Ranking of the Equity Shares
The equity shares allotted pursuant to this Issue shall rank pari-passu in all respects with the then
existing equity shares of the company, including dividend, if any to be declared for the year
ending March 31, 2006. The Equity Shares shall be subject to the memorandum and articles of
association of the Company. The voting rights in a call, whether present in person or by
representative or by proxy shall be in proportion to the paid up value of the Equity Shares held,
and no voting rights shall be exercisable in respect of moneys paid in advance until the moneys
have become payable. Further, money so paid in excess of the amount of calls shall not rank for
dividend and until appropriated towards satisfaction of any call shall be treated as a loan to the
Company and not as a part of its capital and shall be repayable to the members at any time
without notice if the Board so decides. For more details see “Main Provisions of Our Articles”
given in page ____.
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Offer to Promoter /Non Resident Equity Shareholders/Applicant
Applications received from NRIs and non-residents for allotment of Equity Shares shall be inter
alia, subject to the conditions imposed from time to time by the RBI under the Foreign Exchange
Management Act, 1999 (FEMA) in the matter of refund of application moneys, allotment of
Equity Shares, issue of letter of allotment / notification No. FEMA 20/200-RB dated May 3, 2000.
The Board of Directors may at its absolute discretion, agree to such terms and conditions as may
be stipulated by RBI while approving the allotment of Equity Shares, payment of dividend etc. to
the non-resident shareholders. The rights shares purchased by non-residents shall be subject to
the same conditions including restrictions in regard to the repatriability as are applicable to the
original shares against which rights shares are issued. By virtue of Circular No. 14 dated
September 16, 2003 issued by the RBI, overseas corporate bodies (“OCBs”) have been
derecognized as an eligible class of investors and the RBI has subsequently issued the Foreign
Exchange Management (Withdrawal of General Permission to Overseas Corporate Bodies
(OCBs)) Regulations, 2003. Accordingly, OCBs shall not be eligible to subscribe to the Equity
Shares. The RBI has however clarified in its circular, A.P. (DIR Series) Circular No. 44, dated
December 8, 2003 that OCBs which are incorporated and are not under the adverse notice of the
RBI are permitted to undertake fresh investments as incorporated non-resident entities. Thus,
OCBs desiring to participate in this Issue must obtain prior approval from the RBI. On providing
such approval to the Company at its registered office, the OCB shall receive the Letter of Offer
and the CAF. Letter of offer and CAF shall be dispatched to non-resident Equity Shareholders in
India only.
Option available to Equity Shareholders
The Composite Application Form clearly indicates the number of Equity Shares that the Equity
Shareholder is entitled to.
If the Equity Shareholder applies for an investment in Equity Shares, then he can:
• Apply for his entitlement in part;
• Apply for his entitlement in part and renounce the other part;
• Apply for his entitlement in full;
• Apply for his entitlement in full and apply for additional Equity Shares.
As per the notification issued by RBI under FEMA, existing non-resident shareholders may apply
for issue of additional equity shares over and above the rights entitlements and the company may
allot the same subject to condition that overall issue of shares to non-resident in the total paid up
capital of the company does not exceed the sectoral cap. The Board of Directors shall agree to
such terms and conditions as may be stipulated by RBI while approving the allotment of Equity
Shares, subject to the same conditions including restrictions in regard to the repatriability as are
applicable to the original shares against which Rights shares are issued. Where the number of
Equity Shares applied for exceeds the number available for allotment, the allotment of shares
would be made in consultation with the Designated Stock Exchange.
Renouncees for Equity Shares can apply for the Equity Shares renounced to them and also apply
for additional Equity Shares.
Utilisation of Issue Proceed
The Board of Directors declares that:
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(i) The funds received against this Issue will be transferred to a separate bank account other than
the bank account referred to sub-section (3) of Section 73 of the Act.
(ii) Details of all moneys utilised out of the Issue shall be disclosed under an appropriate separate
head in the balance sheet of the Company indicating the purpose for which such moneys has
been utilised.
(iii) Details of all such unutilised moneys out of the Issue, if any, shall be disclosed under an
appropriate separate head in the balance sheet of the Company indicating the form in which such
unutilised moneys have been invested.
The funds received against this Issue will be kept in a separate bank account and the Company
will not have any access to such funds unless it satisfies the Designated Stock Exchange with
suitable documentary evidence that the minimum subscription of 90% of the Issue has been
received by the Company.
Undertaking by the Company
1. The complaints received in respect of the Issue shall be attended to by the Company
expeditiously and satisfactorily.
2. All steps for completion of the necessary formalities for listing and commencement of trading
at all Stock Exchanges where the securities are to be listed will be taken within seven working
days of finalization of basis of allotment.
3. The funds required for dispatch of refund orders/ allotment letters/ certificates by registered
post shall be made available to the Registrar to the Issue.
4. The certificates of the securities/ refund orders to the non-resident Indians shall be dispatched
within the specified time.
5. No further issue of securities affecting equity capital of the Company shall be made till the
securities issued/offered through the Issue are listed or till the application moneys are refunded
on account of non-listing, under-subscription etc.
6. The Company accepts full responsibility for the accuracy of information given in this Letter of
Offer and confirms that to best of its knowledge and belief, there are no other facts the omission
of which makes any statement made in this Letter of Offer misleading and further confirms that it
has made all reasonable enquiries to ascertain such facts.
7. All information shall be made available by the Lead Managers and the Issuer to the investors at
large and no selective or additional information would be available for a section of the investors
in any manner whatsoever including at road shows, presentations, in research or sales reports
etc.
How to apply
Resident Equity Shareholders
Applications should be made on the enclosed CAF provided by the Company. The enclosed CAF
should be completed in all respects, as explained in the instructions indicated in the CAF.
Applications will not be accepted by the Lead Managers or by the Registrar to the Issue or by the
Company at any offices except in the case of postal applications as per instructions given
elsewhere in the Draft Letter of Offer.
The CAF consists of four parts:
Part A: Form for accepting the Equity Shares offered and for applying for additional Equity
Shares
Part B: Form for renunciation
Part C: Form for application for renouncees
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Part D: Form for request for split application forms
Non-resident Equity Shareholders
Applications received from the Non-Resident Equity Shareholders for the allotment of Equity
Shares shall, inter alia, be subject to the conditions as may be imposed from time to time by the
RBI, in the matter of refund of application moneys, allotment of Equity Shares, issue of letters of
allotment/ certificates/payment of dividends etc. Letter of offer and CAF shall be dispatched to
non-resident Equity Shareholders in India only
Acceptance of the Issue
You may accept the Issue and apply for the Equity Shares offered, either in full or in part by
filling Block III of Part A of the enclosed CAF and submit the same along with the Application
Money payable to the Bankers to the Issue or any of the branches as mentioned on the reverse of
the CAF before the close of the banking hours on or before the Issue Closing Date or such
extended time as may be specified by the Board thereof in this regard. Applicants at centers not
covered by the branches of collecting banks can send their CAF together with the cheque drawn
on a local bank at Chennai/demand draft payable at Chennai to the Registrar to the Issue by
registered post. Such applications sent to anyone other than the Registrar to the Issue are liable to
be rejected.
Mode of Payment
FOR RESIDENT SHAREHOLDERS
Only one mode of payment per application should be used. The payment must be either in cash
(not more than Rs.20000) or by cheque/demand draft drawn on any of the banks (including a cooperative bank), which is situated at and is a member or a sub member of the Bankers Clearing
House located at the centre indicated on the reverse of the CAF where the application is to be
submitted. The payment against the share application should not be effected in cash if the
amount to be paid is Rs. 20,000/- or more, as per Section 269 SS of the Income-Tax Act. In case
payment is effected in contravention of this, the application may be deemed invalid and the
application money will be refunded and no interest will be paid thereon.
Outstation cheques/money orders/postal orders will not be accepted and CAFs accompanied by
such cheques/money orders/postal orders are liable to be rejected.
All cheques/drafts accompanying the CAF should be drawn in favour of “Apollo Sindhoori
Capital Investments Limited A/c. ASCIL - Rights Issue” and crossed “A/C Payee only”. No
receipt will be issued for application money received. The Bankers to the Issue/Collecting
Bank/Collection centres will acknowledge receipt of the same by stamping and returning the
acknowledgement slip at the bottom of the CAF.
Applicants residing at places other than places where the Collection Centres have been opened
by the Company for collecting applications, are requested to send their applications together with
Demand Draft (net of DD charges) favouring the “Apollo Sindhoori Capital Investments
Limited A/c. ASCIL - Rights Issue” payable at Chennai, directly to the Registrars to the Issue by
REGISTERED POST so as to reach them on or before the closure of the Issue. The Company or
the Registrars will not be responsible for postal delays, if any.
New demat account shall be opened for holders who have had a change in status from Resident
Indian to NRI.
105
APPLICATION BY NON-RESIDENT INDIAN SHAREHOLDERS
Application on non-repatriation basis
As regards the application by NRI shareholders, the following further conditions shall apply:
Payment by NRIs/FIIs must be made by demand draft/cheque payable at Chennai or funds
remitted from abroad in any of the following ways:
Application on repatriation basis (only by existing shareholders and renouncees having the
requisite permission of RBI)
a) By Indian Rupee drafts purchased from abroad and payable at Chennai or funds remitted
from abroad; OR
b) By cheque/draft on a Non-Resident External Account (NRE) or FCNR Account; OR
c) Rupee draft purchased by debit to NRE/FCNR Account maintained elsewhere in India and
payable in Chennai; OR
d) FIIs registered with SEBI must remit funds from special non-resident rupee deposit account.
All cheques/drafts submitted by NRIs/ FIIs should be drawn in favour of “Apollo Sindhoori
Capital Investments Limited A/c. ASCIL - Rights Issue” payable at Chennai and must be crossed
“A/c Payee only” for the amount payable.
A separate cheque or bank draft must accompany each application form. Applicants may note
that where payment is made by drafts purchased from NRE/FCNR accounts as the case may be,
an Account Debit Certificate from the bank issuing the draft confirming that the draft has been
issued by debiting the NRE/FCNR account should be enclosed with the CAF. In the absence of
the above the application shall be considered incomplete and is liable to be rejected. In case
where repatriation benefit is available, dividend and sales proceeds derived from the investment
in shares can be remitted outside India, subject to tax, as applicable according to the Income-tax
Act, 1961 and subject to the permission of the RBI, if required.
In the case of NRI’s who remit their application money from funds held in FCNR/NRE Accounts,
refunds and other disbursements, if any shall be credited to such account details of which should
be furnished in the appropriate columns in the CAF. In the case of NRIs who remit their
application money through Indian Rupee Drafts from abroad, refunds and other disbursements,
if any will be made in US Dollars at the rate of exchange prevailing at such time subject to the
permission of RBI. The Company will not be liable for any loss on account of exchange rate
fluctuation for converting the Rupee amount into US Dollars or for collection charges charged by
the applicant’s Bankers.
Applications received from NRs (Non-Residents), NRIs and persons of Indian origin resident
abroad, for allotment of Equity Shares shall be inter-alia, subject to the conditions imposed from
time to time by the RBI under the Foreign Exchange Management Act, 1999 (FEMA) in the matter
of refund of application moneys, allotment of Equity Shares, issue of Letter of Allotment / Share
Certificates, Warrant Certificate, dividends, etc.
Application on non-repatriation basis
As far as NRIs holding shares on non-repatriation basis are concerned, in addition to the ways
specified above, payment may also be made by way of cheque drawn on Non-Resident
(ordinary) account or Rupee Draft purchased out of NRO Account maintained elsewhere in India
but payable at Chennai. In such cases, the allotment of Equity shares will be on non-repatriation
basis.
106
All cheques/drafts submitted by NRIs/ FIIs should be drawn in favour of “Apollo Sindhoori
Capital Investments Limited A/c. ASCIL - Rights Issue - NR” payable at Chennai and must be
crossed “A/c Payee only” for the amount payable. The CAF duly completed together with the
amount payable on application must be deposited with the collecting bank indicated on the
reverse of the CAF before the close of banking hours on the Issue closing date. A separate cheque
or bank draft must accompany each application form.
Applicants may note that where payment is made by drafts purchased from NRE/FCNR/NRO
accounts as the case may be, an Account Debit Certificate from the bank issuing the draft
confirming that the draft has been Issued by debiting the NRE/FCNR/NRO account should be
enclosed with the CAF. Otherwise the application shall be considered incomplete and is liable to
be rejected.
Note: In case where repatriation benefit is available, dividend and sales proceeds derived from
the investment in shares can be remitted outside India, subject to tax, as applicable according to
the Income-tax Act, 1961.
In case shares are allotted on non-repatriation basis, the dividend/sale proceeds of the equity
shares cannot be remitted outside India.
The CAF duly completed together with the amount payable on application must be deposited
with the collecting bank indicated on the reverse of the CAF before the close of banking hours on
the aforesaid Issue closing date. A separate cheque or bank draft must accompany each
application form.
In case of applications received from Non-Resident Indians, refunds and other distribution, if
any, will be made in accordance with the guidelines/rules prescribed by RBI as applicable at the
time of making such remittance and subject to necessary approvals.
GROUNDS FOR TECHNICAL REJECTION
Applicants are advised to note that applications are liable to be rejected on technical grounds,
including the following:
2. Amount paid does not tally with the amount payable for;
3. Bank account details (for refund) are not given;
4. Age of First Applicant not given;
5. Applications by Minors;
6. PAN or GIR Number not given if application is for Rs. 50,000 or more;
7. In case of application under power of attorney or by limited companies, corporate, trust,
etc., relevant documents are not submitted
8. If the signature of the existing shareholder does not match with the one given on the
CAF;
9. CAF are not submitted by the applicants within the time prescribed as per the
instructions in the CAF and the Letter of Offer
10. Applications not duly signed by the sole/joint applicants;
11. OCBs who cannot apply in terms of RBI restrictions;
12. Applications accompanied by Stockinvest;
13. In case no corresponding record is available with the Depositories that matches three
parameters, namely, names of the applicants (including the order of names of joint
holders), the depositary participant’s identity (DP ID) and the beneficiary’s identity;
14. Applications by ineligible Non-residents (including on account of restriction or
prohibition under applicable local laws).
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GENERAL
a) Please read the instructions printed on the enclosed CAF carefully.
b) The CAF would be printed in black ink for all shareholders.
c) Application should be made on the printed CAF, provided by the Company except as under
the head “Application on Plain Paper” in this Letter of Offer and should be completed in all
respects.
d) The CAF found incomplete with regard to any of the particulars required to be given therein,
and/or which are not completed in conformity with the terms of this Letter of Offer are liable
to be rejected and the money paid, if any, in respect thereof will be refunded without interest
and after deduction of bank commission and other charges, if any.
e) The CAF must be filled in English and the names of all the applicants, details of occupation,
address, father’s/husband’s name must be filled in block letters.
f) Signatures should be either in English or Hindi or the languages specified in the Eighth
Schedule to the Constitution of India. Signatures other than in the aforesaid languages or
thumb impression must be attested by a Notary Public or a Special Executive Magistrate
under his/her official seal.
g) The CAF together with cheque/demand draft should be sent to the Bankers to the
Issue/collection centres or to the Registrars and not to the Company or Lead Managers to the
Issue. Applicants residing at places other than cities where the branches of the Bankers to the
Issue have been authorised by the Company for collecting applications, will have to make
payment by Demand Draft payable at Chennai and send their application forms to the
Registrars to the Issue by REGISTERED POST after deducting DD and postal charges. If any
portion of the CAF is detached or separated, such application is liable to be rejected.
h) In case of applications for a total value of Rs. 50,000/- or more, i.e. The total number of
securities applied for multiplied by the Issue price, is Rs. 50,000/- or more the applicant or in
the case of application in joint names, each of the applicants, should mention his/her
permanent account number allotted under the Income-Tax Act, 1961 or where the same has
not been allotted, the GIR number and the Income-Tax Circle/Ward/District. In case where
neither the permanent account number nor the GIR number has been allotted, the fact of nonallotment should be mentioned in the application forms. Application forms without this
information will be considered incomplete and are liable to be rejected.
i) In case of an application under Power of Attorney or by a body corporate or by a society, a
certified true copy of the relevant Power of Attorney or relevant resolution or authority to
make investment and sign the application along with the copy of the Memorandum &
Articles of Association and/or bye laws must be lodged with the Registrars to the Issue
giving reference of the serial number of the CAF. In case the above referred documents are
already registered with the Company, the same need not be furnished again; however, the
serial number of registration or reference of the letter, vide which these papers were lodged
with the Company must be mentioned just below the signature(s) on the application. In no
case should these papers be attached to the application submitted to the Bankers to the Issue.
Also applications received after Issue closing date are liable to be rejected.
j) In case of joint holders, all joint holders must sign the relevant part of the CAF in the same
order and as per the specimen signature(s) recorded with the Company. Further, in case of
joint applicants who are renouncees, the number of applicants should not exceed three.
k) In case of joint applicants, reference, if any, will be made in the first applicant’s name and all
communication will be addressed to the first applicant at the address given in the CAF.
l) The shareholders must sign the CAF as per the specimen signature recorded with the
Company.
m) Application(s) received from Non-Resident/NRIs, or persons of Indian origin residing
abroad for allotment of Equity shares shall, inter alia, be subject to conditions, as may be
imposed from time to time by the RBI under FEMA in the matter of refund of application
108
n)
o)
p)
q)
r)
money, allotment of equity shares, subsequent Issue and allotment of Equity shares,
dividend, export of share certificates, etc. In case a Non-Resident or NRI shareholder has
specific approval from the RBI, in connection with his shareholding, he should enclose a copy
of such approval with the CAF.
All communication in connection with application for the equity shares, including any
change in address of the shareholders should be addressed to the Registrars to the Issue
quoting the name of the first/sole applicant shareholder, folio numbers /beneficiary identity
number and CAF number.
Split forms cannot be re-split.
Only the person or persons to whom equity shares have been offered and not renouncee(s)
shall be entitled to obtain split forms.
Bank Account Details: It is mandatory for the applicant to mention the applicant’s savings
bank/current account number and the name of the bank with whom such account is held in
the space provided in the CAF, to enable the Registrars to the Issue, to print the said details
in the refund orders after the name of the payees. Such applications not containing the above
details are liable to be rejected.
Payment by cash: The payment against the share application should not be effected in cash if
the amount to be paid is Rs. 20,000/- or more. In case payment is effected in contravention of
this, the application will be deemed invalid and the application money will be refunded and
no interest will be paid thereon. Payment against the application if made in cash, subject to
conditions as mentioned above, should be made only to the Bankers to the Issue.
Availability of Duplicate CAF
In case the original CAF is not received, or is misplaced by the applicant, the applicant may
request the Registrar to the Issue, for issue of a duplicate CAF, by furnishing the registered folio
number, DP ID Number, Client ID Number and their full name and address. Please note that
those who are making the application in the duplicate form should not utilize the original CAF
for any other purpose including renunciation, even if it is received /found subsequently. Thus, in
case the original and duplicate CAFs are lodged for subscription, allotment will be made on the
basis of the duplicate CAF and the original CAF will be ignored.
Application on Plain Paper
A shareholder who has neither received the original CAF nor is in a position to obtain the
duplicate CAF may make an application to subscribe to the Rights Issue on plain paper, along
with an Account Payee Cheque drawn on a local bank at Chennai/Draft payable at Chennai and
send the same by Registered Post directly to the Registrars to the Issue.
The application on plain paper, duly signed by the applicants including joint holders, in the same
order as per specimen recorded with the Company, must reach the office of the Registrars to the
Issue before the date of closure of the Issue and should contain the following particulars:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
Name of the Issuer
Name of the shareholder including joint holders
Address of sole /first holder
Folio Number/DP ID number and client ID number
Number of shares held as on Record date
Certificate numbers and Distinctive numbers, if held in physical form
Number of Rights Equity Shares entitled
Number of additional equity shares applied for, if any
Total number of equity shares applied for
Amount payable on application
Particulars of Cheque/Draft enclosed
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12. Savings/Current Account Number and Name and Address of the Bank where the
shareholder will be depositing the refund order, and
13. PAN/GIR number and Income Tax Circle/Ward/District where the application is for equity
shares of a total value of Rs. 50,000/- or more for the applicant and for each applicant in case
of joint names.
14. In case of Non-resident shareholders, NRE/FCNR/NRO account no., Name and address of
the bank and branch
15. Signature of shareholders to appear in the same sequence and order as they appear in the
records of the Company
Payments in such cases should be through a cheque/demand draft payable at Chennai to be
drawn in favour of the “Apollo Sindhoori Capital Investments Limited A/c. ASCIL - Rights
Issue” and the marked “A/c Payee” in case of resident shareholders and non-resident
shareholders holding on nonrepatriable basis. Payment in case of non-resident shareholders
holding on repatriable basis shall be drawn in favour of the “Apollo Sindhoori Capital
Investments Limited A/c. ASCIL - Rights Issue - NR” and then marked “A/c Payee”. The
envelope should be superscribed “ASCIL - Rights Issue”.
Please note that those who are making the application on plain paper shall not be entitled to
renounce their rights and should not utilise the CAF for any purpose including renunciation even
if it is received subsequently. If the applicant violates any of these requirements, he/she shall face
the risk of rejection of both the applications. The Company shall refund such application amount
to the applicant without any interest thereon.
Last date for Submission of CAF
The last date for receipt of the CAF by the Banker to the Issue at its Collecting Branches, together
with the amount payable, is on or before the close of banking hours on ________, 2006. The Board
will have the right to extend the said date for such period as it may determine from time to time
but not exceeding sixty days from the date the Issue opens. If the CAF together with the amount
payable is not received by the Banker to the Issue/Registrars to the Issue at its Collection
Branches on or before the close of banking hours on or before ______, 2006, the offer contained in
this Letter of Offer shall be deemed to have been declined, and the Board shall utilise this
entitlement for allotting the Equity Shares as mentioned below under the heading “Basis of
Allotment”.
Basis of Allotment
1.
The Board, subject to provisions contained in this Letter of Offer and the Articles of
Association of the Company will proceed to allot the equity shares in the following order of
priority:
a) Full allotment to those shareholders who have applied for their rights entitlement either
in full or in part and also to the renouncee(s) who has/have applied for Equity shares
renounced in their favour, in full or in part.
b) To the shareholders who having applied for all the Equity shares offered to them as their
entitlement rights, have also applied for additional equity shares, provided there is an
undersubscribed portion after making full allotment in (a) above. The allotment of such
additional shares will be made with reference to the number of equity shares held by
those shareholders on the Record date within the overall size of the Rights Issue in
consultation with the Designated Stock Exchange.
The allotment of additional Equity Shares to the Promoter over and above its Entitlement
in this Issue will not result in change in management or control of the Company and shall
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be done in compliance with Clause 40A of the Listing Agreement and the other
applicable laws prevailing at that time.
In terms of proviso to regulation 3(1)(b)(ii) of the Takeover Code, acquisition of
additional equity shares in a rights issue, in the event of undersubscription of the issue,
by any person presently in control of the company, will be exempt from the applicability
of regulation 11 and 12 of Takeover Code. Further, in order for the exemption to be
applicable, the person presently in control of the company should make a disclosure of
its intension to acquire additional Equity Shares in the Draft Letter of Offer/Letter of
Offer and the acquisition should not result in change of control of management of the
company
c) To renouncees who having applied for all the shares renounced in their favour have
applied for additional shares, provided there is a surplus remaining after (a) and (b)
above.
2.
After taking into account the allotments made under 1(a), 1(b) and 1(c) above, if there is still
any undersubscription, the unsubscribed portion shall be disposed off by the Board or
Committee of Directors authorised in this behalf by the Board upon such terms and
conditions and to such person/persons and in such manner as the Board/Committee may in
its absolute discretion deem fit.
The basis of allotment shall be finalised by the Board in consultation with MSE, which is the
Designated Stock Exchange, within a period of 42 days from the date of closure of the Issue.
In case of delay in allotment the Company shall, as stipulated under Section 73(2A) of the
Act, be required to pay interest on the same at a rate of 15% p.a.
No oversubscription shall be retained by the Company.
Disposal of Application & Application Money
The Board reserves its right to accept or reject any application, in whole or in part, and in case the
concerned application is not made in terms of this Letter of Offer.
In case an application is rejected in full, the whole of the application money received will be
refunded to the first named applicant. Wherever an application is rejected in part, the balance of
application money, if any, after adjusting any money due on shares allotted, will be refunded to
the first named applicant within six weeks from the date of closure of the subscription list in
accordance with Section 73 of the Act. If there is delay in refund of application money by more
than 8 days after the Company becomes liable to pay (i.e. forty two days after the closure of
Issue), the Company will pay interest for the delayed period at the rate prescribed under
subsection (2) and (2A) of Section 73 of the Act.
The subscription monies received in respect of this Issue will be kept in a separate bank account
and the Company will not have access to nor appropriate the funds until it has satisfied MSE
with suitable documentary evidence that minimum subscription of 90% of the application money
for the Issue has been received.
No separate receipt will be issued for the application money. However, the Banker to the Issue at
its collecting branches physically receiving the application will acknowledge its receipt by
stamping and returning the perforated acknowledgement slip at the bottom of each CAF. Except
for the reasons stated under “GROUNDS FOR TECHNICAL REJECTIONS” in this Letter of Offer
and subject to valid application, acknowledgement of receipt of application money given by the
bankers to the issue shall be valid and binding on issuer and other persons connected with the
Issue.
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Allotment/Refund
Equity Share certificates / Letters of Allotment or Letter(s) of Regret together with refund orders
exceeding Rs 1,500/-, if any, will be dispatched by registered post/speed post at the sole/first
named applicant’s address within 42 days from the date of the closing of the subscription list.
Refund orders upto Rs 1,500/- will be dispatched under the Certificate of Posting. Adequate
funds will be made available to the Registrars for the purpose.
In case of those shareholders who have opted to receive their Rights Entitlement Shares in
dematerialised form by using electronic credit under the depository system, an advice regarding
the credit of the Equity Shares shall be given separately.
If such money is not repaid within 8 days from the day the Company becomes liable to pay it, the
Company shall pay that money with interest as stipulated under Section 73 of the Act.
Refunds will be made by cheques or pay orders drawn on the bank(s) appointed by the Company
as refund bankers. Such instruments will be payable at par at the places where applications are
accepted. Bank charges, if any, for encashing such cheques or pay orders will be borne by the
applicants.
Interest in Case of delay in Allotment/Despatch
The Company agrees that:
1. Allotment of securities offered shall be made within 42 days of the closure of the rights Issue;
2. The Company shall pay interest @ 15% per annum if the allotment has not been made and/or
the allotment letters/refund orders have not been despatched to the investors within 42 days
from the date of the closure of the Issue.
Letters of allotment / Equity share certificates/regret letters/refund orders
The Company will issue, or credit the allotted securities to the respective DP accounts or
despatch Letter of Allotment/Share Certificates/and/or Letter of Regret along with refund
orders, if any, at the registered address of the first named applicant within a period of six weeks
from the date of closure of the Issue, by Registered Post. If such money is not repaid, within 8
days from the day the Company would become liable to pay it, the Company shall, as stipulated
under Section 73 (2 A) of the Act, pay that money with interest @ 15% p.a. Letter of
Allotment/Share Certificates/Refund Orders above the value of Rs. 1500, will be despatched by
Registered Post to the sole/first applicant’s registered address. However, Refund Orders for
value not exceeding Rs. 1500 shall be sent to the applicants under Certificate of Posting. Such
cheques or pay orders will be payable at par at all the centres where the applications were
originally accepted and will be marked “A/C Payee” and would be drawn in the name of a
sole/first applicant. Adequate funds would be made available to the Registrars to the Issue for
this purpose.
Particulars of the applicant’s Savings/Current Bank Account should be given in the space
provided therefor in the application form so as to enable the Registrars to print the same on the
refund order, if any.
As regards allotment/refund to NRIs, the following further conditions shall apply:
In case of NRIs, who remit their application monies from funds held in NRE/FCNR accounts,
refunds and/or payment of dividend and other disbursement, if any, shall be credited to such
accounts, details of which should be furnished in the CAF and as furnished by the depository in
case shares are held in electronic form. Subject to the approval of the RBI, in case of NRIs, who
112
remit their application monies through Indian Rupee draft purchased from abroad, refund
and/or payment of dividend and any other disbursement, will be made net of bank
charges/commission in U.S. Dollars, at the rate of exchange prevailing at such time and shall be
credited to such accounts, details of which should be furnished in the CAF as furnished by the
depository in case shares are held in electronic form. The Company will not be responsible for
any loss on account of exchange fluctuations for converting the Indian Rupee amount into U.S.
Dollars. The share certificates for the Equity shares will be sent by registered post at the address
of the NRI applicant.
BANK ACCOUNT DETAILS OF THE APPLICANT
Applicants who are holding shares in physical form are advised to provide information as to
their savings/current account number and the name of the Bank with whom such account is held
in space provided in the Composite Application Form to enable the Registrar to print the said
details in the Refund Orders, if any, after the names of the payees. Application not containing
such details is liable to be rejected.
OPTION TO RECEIVE THE RIGHTS EQUITY SHARES IN DEMATERIALISED FORM
Applicants have the option to hold the equity shares in electronic form under the depository
system. The company has signed an agreement with National Securities Depository Limited
(NSDL) on 25.1.2000, which enables an investor to hold and trade in securities in a dematerialised
(electronic/demat) form, instead of holding equity shares in the form of physical certificates.
Equity shares being offered through this Rights Issue will be admitted to NSDL, when allotted.
Applicants may note that they have the option to subscribe to the Rights equity shares in demat
or physical form, or partly in demat and physical form, in the same application, in the space
provided. No separate applications for demat and physical shares are to be made. If such
application is made, the applications for physical shares will be treated as multiple application
and rejected accordingly. In case of partial allotment, allotment will be first done in demat form,
and the balance, if any, will be allotted in physical form.
The procedure for opting for this facility for allotment of equity shares arising out of this Issue in
electronic form is as under:
1.
Open a Beneficiary Account with any Depository Participant (care should be taken that the
Beneficiary Account should carry the name of the holder in the same manner as is exhibited
in the records of the company. In case of joint holding, the Beneficiary Account should be
opened carrying the names of the holders in the same order and style as are appearing in the
records of the Company). In case of Investors having various folios in the Company with
different joint holders, the investors will have to open separate beneficiary accounts for such
holdings. This step need not be adhered to by those shareholders who have already opened
such Beneficiary Account(s).
2.
For shareholders holding shares in dematerialised form as on the Record date, the beneficial
account number shall be printed on the CAF. For those who open accounts later or those who
change their accounts and wish to receive their Rights equity shares by way of credit to such
account the necessary details of their beneficiary account should be filled in the space
provided in the CAF. It may be noted that the allotment of equity shares arising out of this
Issue can be received in demat form even if the original equity shares of the Company are not
dematerialised. Nonetheless, it should be ensured that the Depository Account is in the
name(s) of the shareholders and the names are in the same order and style as are appearing
in the records of the Company.
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3.
Responsibility for correctness of applicant’s age and other details given in the CAF vis-à-vis
those with the applicant’s Depository Participant, would rest with the applicant. Applicants
should ensure that the names of the applicants and the order in which they appear in CAF
should be same as registered with the applicant’s Depository Participant.
4.
If incomplete/incorrect Beneficiary Account details are given in the CAF or where the
investor does not opt to receive the Rights equity shares in demat form, the Company will
issue equity shares in the form of physical certificate(s).
5.
The Rights equity shares allotted to investors opting for demat form, would be directly
credited to the Beneficiary Account as given in the CAF after verification. Allotment advice,
refund order (if any) would be sent directly to the applicant by the Registrars to the Issue but
the confirmation of the credit of the Rights equity shares to the applicant’s Depository
Account will be provided to the applicant by the applicant’s Depository Participant.
6.
Renouncees can also exercise this option to receive equity shares in the demat form by
indicating in the relevant block and providing the necessary details about their Beneficiary
Account.
RENUNCIATION
As an equity shareholder, you have the right to renounce your entitlement to the equity shares in
full or in part in favour of one or more person(s). Your attention is drawn to the fact that the
company shall not allot and/or register any equity shares in favour of:
a) More than three persons including joint holders;
b) Any Trust or Society (unless the same is registered under the applicable Trust Laws or the
Societies Registration Act, 1860 or any other laws and is authorised under its constitution to
hold equity shares in a company);
c) Partnership firm(s) or their nominee(s);
d) Minors
e) HUFs
The right of renunciation is subject to the express condition that the Board shall be entitled in its
absolute discretion to reject the request for allotment to renouncee(s) without assigning any
reason thereof.
Any of the following renunciations:
a) From Resident(s) to Non-Resident Indian(s)
b) From Non-Resident Indian(s) to Resident(s)
c) From Non-Resident Indian (s) to Non-Resident Indian(s)
is also subject to the renouncer(s)/renouncee(s) obtaining the necessary approval of the RBI
under the provisions of the Foreign Exchange Management Act, 1999 and other applicable laws
and such permission should be attached with the CAF.
Renouncee(s) have the right to apply for additional shares provided they have accepted the
shares renounced in their favour in full. The renouncee cannot further renounce his/her
entitlement.
PROCEDURE FOR RENUNCIATION
a)
To renounce the whole offer in favour of one renouncee
If you wish to renounce the offer indicated in Part A, in whole, please complete Part B of the
CAF. In case of joint holding, all joint holders must sign Part B of the CAF. The person in
whose favour renunciation has been made should complete and sign Part C of the CAF. In
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case of joint renouncees, all joint renouncees must sign this part of the CAF.
b)
To renounce in part/or to renounce the whole to more than one renouncee
If you wish to either accept this offer in part and renounce the balance or renounce the entire
offer in favour of two or more renouncees, the CAF must be first split into requisite number
of forms. For this purpose you will have to apply to the Registrars to the Issue. Please
indicate your requirement of split forms in the space provided for this purpose in Part D of
the CAF and return the entire CAF to the Registrars to the Issue so as to reach them latest by
the close of business hours on the last date of receiving requests for split forms. On receipt of
the required number of split forms from the Registrar, the procedure as mentioned in para(a)
above shall have to be followed.
In case the signature of the shareholder(s) who has renounced the Rights Shares, does not
agree with the specimen registered with the Company, the application will be rejected and
the Rights offer will lapse.
c)
Renouncee(s)
The person in whose favour the equity shares are renounced should fill in and sign Part C
and submit the entire CAF to the Bankers or to the collection centres to the Issue on or before
the closing date of the Issue along with the application money.
d)
Change and/or introduction of additional holders
If you wish to apply for equity shares jointly with any other person or persons, not more
than three, who is/are not already joint holders with you, it shall amount to renunciation
and the procedure as stated above for renunciation shall have to be followed. Even a change
in the sequence of the name of joint holders shall amount to renunciation and the procedure,
as stated above for renunciation shall have to be followed.
However, this right of renunciation is subject to the express condition that the Board of Directors
of the Company shall be entitled in its absolute discretion to reject the request for allotment from
the renouncee(s) without assigning any reason therefore.
Please note that:
a) Part A of the CAF must not be used by any person(s) other than those in whose favour
this offer has been made. If used otherwise, this will render the application invalid.
b) Request for split form should be made in multiples of 50 equity shares only and one split
form for the balance shares, if any.
c) Only the person to whom this Letter of Offer has been addressed and not the
renouncee(s) shall be entitled to apply for split forms. Forms once split cannot be split
again.
d) Split form(s) will be sent to the applicant(s) by post at the applicant’s risk.
You may exercise any of the following options with regard to the equity shares offered to you,
using the enclosed CAF:
Option Available
1. Accept whole or part of your
entitlement without renouncing the
balance.
2. Accept your entitlement to all the
equity shares offered to you and
apply for additional equity shares.
3. Renounce your entitlement to all the
equity shares offered to you, to one
Action Required
Fill in Block I and sign Part A (all joint holders must
sign)
Fill in and sign Part A including Block II relating to
additional shares (all joint holders must sign)
Fill in and sign Part B (all joint holders must sign)
indicating the number of equity shares renounced
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person
(joint
renouncees
considered as one).
4.
are
Accept a part of your entitlement to
the equity shares offered to you and
renounce the balance to one or more
renouncee(s).
OR
Renounce your entitlement to all the
equity shares offered to you to more
than one renouncee.
5. Introduce joint-holder or change the
sequence of joint holder
and hand it over to the renouncee. The renouncees
must fill in and sign Part C (all joint renouncees must
sign).
Fill in and sign Part D (all joint holders must sign) for
the required number of split forms and send the
CAF to the Registrars to the Issue so as to reach
them on or before the last date for receiving
requests for split forms.
Splitting will be permitted only once.
Request for split forms must be in multiples of 50
Equity shares only and one split form for the
balance shares, if any. On receipt of the split form
take action as indicated below.
a) For the equity shares you wish to accept, if
any, fill in and sign Part A.
b) For the Equity shares you wish to renounce, fill
in and sign Part B indicating the number of
equity shares renounced and hand it over to
the renouncees. Each of the renouncees should
fill in and sign Part C for the equity shares
accepted by them.
This will be treated as a renunciation.
Applicants must provide information in the CAF as to their savings bank/current account
number and the name of the bank with whom such account is held, to enable the Registrar to
print the said details in the refund orders after the names of the payees. Failure to comply with
this may lead to rejection of the application. Bank account details furnished by the depositories
will be printed on the refund warrant in case of shares held in electronic form.
Applicants must write their CAF Number at the back of the cheque/demand draft.
Issue of Duplicate Share Certificate(s)
If any Equity Share(s) is/are mutilated or defaced or the pages for recording transfers of Equity
Share are fully utilized, the same may be replaced by the Company against the surrender of such
Certificate(s). Provided, where the Equity Share Certificate(s) are mutilated or defaced, the same
will be replaced as aforesaid only if the Certificate numbers and the Distinctive numbers are
legible.
If any Equity Shares Certificate is destroyed, stolen or lost, then upon production of proof thereof
to the satisfaction of the Company and upon furnishing such indemnity/ surety and/or
documents as the Company may deem adequate, duplicate Equity Share Certificate(s) shall be
issued.
INVESTORS MAY PLEASE NOTE THAT THE EQUITY SHARES OF THE COMPANY CAN
BE TRADED ON THE STOCK EXCHANGES ONLY IN DEMATERIALIZED FORM.
Basis of Allotment
Subject to the provisions contained in this Draft Letter of Offer, the Articles of Association of the
Company and the approval of the Designated Stock Exchange, the Board will proceed to allot the
Equity Shares in the following order of priority:
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(a) Full allotment to those Equity Shareholders who have applied for their rights entitlement
either in full or in part and also to the renouncee(s) who has/ have applied for Equity Shares
renounced in their favour, in full or in part.
(b) If the shareholding of any of the Equity Shareholders is less than five or is not in multiples of
five, then the fractional entitlement of such holders for Equity Shares shall be ignored. Equity
Shareholders whose fractional entitlements are being ignored would be given preferential
allotment of ONE additional Equity Share each if they apply for additional shares. (For further
details please see the section “Terms of the Issue – Fractional Entitlements” on page ____of this
Draft Letter of Offer)
(c) Allotment to the Equity Shareholders who having applied for all the Equity Shares offered to
them as part of the Issue and have also applied for additional Equity Shares. The allotment of
such additional Equity Shares will be made as far as possible on an equitable basis having due
regard to the number of Equity Shares held by them on the Record Date, provided there is an
undersubscribed portion after making full allotment in (a) above. The allotment of such Equity
Shares will be at the sole discretion of the Board/Committee of Directors in consultation with the
Designated Stock Exchange, as a part of the Issue and not preferential allotment.
(d) Allotment to the renouncees who having applied for the Equity Shares renounced in their
favour have also applied for additional Equity Shares, provided there is an under-subscribed
portion after making full allotment in (a) and (b) above. The allotment of such additional Equity
Shares will be made on a proportionate basis at the sole discretion of the Board/ Committee of
Directors but in consultation with the Designated Stock Exchange, as a part of the Issue and not
as a preferential allotment. After taking into account allotment to be made under (a) and (b)
above, if there is any unsubscribed portion, the same shall be deemed to be ‘unsubscribed’ for the
purpose of regulation 3(1)(b) of the Takeover Code which would be available for allocation under
(c) and (d) above. The Promoter and the promoter group intend to subscribe to unsubscribed
portion if the Issue does not have subscription to the extent of 90% of the Issue size, after
considering the above allotment, to ensure that the Issue is successful. This acquisition of
additional Equity Shares, if allotted to the Promoter shall be in terms of proviso to regulation
3(1)(b)(ii) of the Takeover Code and will be exempt from the applicability of regulation 11 and 12
of Takeover Code. This disclosure is made in terms of the requirement of Regulation 3(1)(b) of
the Takeover Code. Further this acquisition will not result in change of control of management of
the Company. After such allotments as above and to the Promoters and the promoter group,
including the application for rights/renunciation and additional equity shares, any additional
Equity Shares shall be disposed off by the Board or committee of the Board authorised in this
behalf by the Board of the Company, in such manner as they think most beneficial to the
Company and the decision of the Board or committee of the Board of the
Company in this regard shall be final and binding. In the event of oversubscription, allotment
will be made within the overall size of the issue.
Allotment to Promoters of any unsubscribed portion, over and above their entitlement shall be
done in compliance with Clause 40A of the Listing Agreement and the other applicable laws
prevailing at that time.
Underwriting
The present Issue is not underwritten.
Allotment / Refund
The Company will issue and dispatch letters of allotment/ share certificates/ demat credit and/
or letters of regret along with refund order or credit the allotted securities to the respective
beneficiary accounts, if any, within a period of 42 days from the Issue Closing Date. If such
money is not repaid within 42 days, the Company shall pay that money with interest as
stipulated under Section 73 of the Act.
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In case of those shareholders who have opted to receive their Right Entitlement Shares in
dematerialized form by using electronic credit under the depository system, an advice regarding
the credit of the Equity Shares shall be given separately. In case the Company issues letters of
allotment, the corresponding share certificates will be kept ready within three months from the
date of allotment thereof or such extended time as may be approved by the Companies Law
Board under Section 113 of the Act or other applicable provisions, if any. Allottees are requested
to preserve such letters of allotment, which would be exchanged later for the share certificates.
For more information, please refer to the section entitled ‘Letters of Allotment / Share Certificates
/ Demat Credit’ on page no. ___ of this Draft Letter of Offer. Letters of allotment/ share
certificates/ demat credit/ refund orders above the value of Rs. 1,500 will be dispatched by
registered post/ speed post to the sole/ first applicant’s registered address. However, refund
orders for value not exceeding Rs. 1,500 shall be sent to the applicants by way of certificate of
posting. Such cheques or pay orders will be payable at par at all the centres where the
applications were originally accepted and will be marked ‘A/c payee’ and would be drawn in the
name of the sole/ first applicant. Adequate funds would be made available to the Registrar to the
Issue for the dispatch of such letters of allotment/ share certificates/ demat credit and refund
orders.
As regards allotment/ refund to non-residents, the following further conditions shall apply:
In case of non-residents, who remit their application monies from funds held in NRE/ FCNR
accounts, refunds and/ or payment of interest/ dividend and other disbursement, if any, shall be
credited to such accounts, details of which should be furnished in the CAF. Subject to the
approval of the RBI, in case of non-residents, who remit their application monies through Indian
Rupee draft purchased from abroad, refund and/ or payment of dividend/ interest and any
other disbursement, shall be credited to such accounts (details of which should be furnished in
the CAF) and will be made net of bank charges/ commission in US Dollars, at the rate of
exchange prevailing at such time. The Company will not be responsible for any loss on account of
exchange fluctuations for converting the Indian Rupee amount into US Dollars. The share
certificate(s) will be sent by registered post at the Indian address of the non-resident applicant.
Interest in Case of Delay in Despatch of Allotment Letters/Refund Orders in Case of Public
Issues
The Company agrees that as far as possible allotment of Equity Shares shall be made within 30
days of the closure of the Issue. The Company further agrees to pay interest @15% per annum if
the allotment letters/refund orders have not been despatched to the applicants within 30 days
from the date of the closure of the Issue.
Letters of Allotment / Share Certificates / Demat Credit
Letter(s) of allotment/ share certificates/ demat credit or letters of regret will be dispatched to
the registered address of the first named applicant or respective beneficiary accounts will be
credited within 6 (six) weeks, from the date of closure of the subscription list. In case the
Company issues letters of allotment, the relative share certificates will be dispatched within three
months from the date of allotment. Allottees are requested to preserve such letters of allotment (if
any) to be exchanged later for share certificates. Export of letters of allotment (if any)/ share
certificates/ demat credit to non-resident allottees will be subject to the approval of RBI.
Option to receive Equity Shares in Dematerialized Form
Applicants to the Equity Shares of the Company issued through this Issue shall be allotted the
securities in dematerialised (electronic) form at the option of the applicant. The Company signed
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a tripartite agreement with dated 25.1.2000 with NSDL and Registrar, which enables the Investors
to hold and trade in securities in a dematerialised form, instead of holding the securities in the
form of physical certificates.
In this Issue, the allottees who have opted for Equity Shares in dematerialised form will receive
their Equity Shares in the form of an electronic credit to their beneficiary account with a
depository participant. Investor will have to give the relevant particulars for this purpose in the
appropriate place in the CAF. Applications, which do not accurately contain this information,
will be given the securities in physical form. No separate applications for securities in physical
and/or dematerialized form should be made. If such applications are made, the application for
physical securities will be treated as multiple applications and is liable to be rejected. 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. The Equity Shares of the Company will be
listed on the MSE.
General instructions for applicants
(a) Please read the instructions printed on the enclosed CAF carefully.
(b) Application should be made on the printed CAF, provided by the Company and should be
completed in all respects. The CAF found incomplete with regard to any of the particulars
required to be given therein, and/ or which are not completed in conformity with the terms of
this Draft Letter of Offer are liable to be rejected and the money paid, if any, in respect thereof
will be refunded without interest and after deduction of bank commission and other charges, if
any. The CAF must be filled in English and the names of all the applicants, details of occupation,
address, father’s / husband’s name must be filled in block letters.
(c) The CAF together with cheque / demand draft should be sent to the Bankers to the Issue /
Collecting Bank or to the Registrar to the Issue and not to the Company or Lead Managers to the
Issue. Applicants residing at places other than cities where the branches of the Bankers to the
Issue have been authorised by the Company for collecting applications, will have to make
payment by Demand Draft payable at Chennai and send their application forms to the Registrar
to the Issue by REGISTERED POST. If any portion of the CAF is / are detached or separated,
such application is liable to be rejected.
(d) Applications for a total value of Rs. 50,000 or more, i.e. where the total number of securities
applied for multiplied by the Issue price, is Rs. 50,000 or more the applicant or in the case of
application in joint names, each of the applicants, should mention his/ her PAN number allotted
under the Income-Tax Act, 1961 and also submit a photocopy of the PAN card(s) or a
communication from the Income Tax authority indicating allotment of PAN (“PAN
Communication”) along with the application for the purpose of verification of the number.
Applicants who do not have PAN are required to provide a declaration in Form 60 / Form 61
prescribed under the I.T.Act along with the application. Application Forms without this
photocopy/ PAN Communication/ declaration will be considered incomplete and are liable to
be rejected.
(e) Applicants are advised to provide information as to their savings/current account number
and the name of the Company with whom such account is held in the CAF to enable the
Registrar to the Issue to print the said details in the refund orders, if any, after the names of the
payees. Application not containing such details is liable to be rejected.
(f) The payment against the application should not be effected in cash if the amount to be paid is
Rs. 20,000 or more. In case payment is effected in contravention of this, the application may be
deemed invalid and the application money will be refunded and no interest will be paid thereon.
Payment against the application if made in cash, subject to conditions as mentioned above,
should be made only to the Bankers to the Issue.
(g) Signatures should be either in English or Hindi or in any other language specified in the Eight
Schedule to the Constitution of India. Signatures other than in English or Hindi and thumb
impression must be attested by a Notary Public or a Special Executive Magistrate under his/ her
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official seal. The Equity Shareholders must sign the CAF as per the specimen signature recorded
with the Company.
(h) In case of an application under power of attorney or by a body corporate or by a society, a
certified true copy of the relevant power of attorney or relevant resolution or authority to the
signatory to make the relevant investment under this Issue and to sign the application and a copy
of the Memorandum and Articles of Association and / or bye laws of such body corporate or
society must be lodged with the Registrar to the Issue giving reference of the serial number of the
CAF. In case these papers are sent to any other entity besides the Registrar to the Issue or are sent
after the Issue Closing Date, then the application is liable to be rejected.
(i) In case of joint holders, all joint holders must sign the relevant part of the CAF in the same
order and as per the specimen signature(s) recorded with the Company. Further, in case of joint
applicants who are renouncees, the number of applicants should not exceed three. In case of joint
applicants, reference, if any, will be made in the first applicant’s name and all communication
will be addressed to the first applicant.
(j) Application(s) received from Non-Resident / NRIs, or persons of Indian origin residing
abroad for allotment of Equity Shares shall, inter alia, be subject to conditions, as may be imposed
from time to time by the RBI under FEMA in the matter of refund of application money,
allotment of Equity Shares, subsequent issue and allotment of Equity Shares, interest, export of
share certificates, etc.
In case a Non-Resident or NRI Equity Shareholder has specific approval from the RBI, in
connection with his shareholding, he should enclose a copy of such approval with the CAF.
(k) All communication in connection with application for the Equity Shares, including any
change in address of the Equity Shareholders should be addressed to the Registrar to the Issue
prior to the date of allotment in this Issue quoting the name of the first / sole applicant Equity
Shareholder, folio numbers and CAF number. Please note that any intimation for change of
address of Equity Shareholders, after the date of allotment, should be sent to the Registrar and
Transfer Agents of the company in the case of Equity Shares held in physical form and to the
respective depository participant, in case of Equity Shares held in dematerialized form.
(l) Split forms cannot be re-split.
(m) Only the person or persons to whom Equity Shares have been offered and not renouncee(s)
shall be entitled to obtain split forms.
(n) Applicants must write their CAF number at the back of the cheque / demand draft.
(o) Only one mode of payment per application should be used. The payment must be either in
cash or by cheque / demand draft drawn on any of the banks, 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 center indicated on the reverse of the CAF where the application is to be submitted.
(p) A separate cheque / draft must accompany each CAF. Outstation cheques / demand drafts or
postdated cheques and postal / money orders will not be accepted and applications accompanied
by such cheques / demand drafts / money orders or postal orders will be rejected. The Registrar
will not accept payment against application if made in cash. (For payment against application in
cash please refer point (f) above)
(q) No receipt will be issued for application money received. The Bankers to the Issue /
Collecting Bank/ Registrar will acknowledge receipt of the same by stamping and returning the
acknowledgment slip at the bottom of the CAF.
Mode of payment for Non-Resident Equity Shareholders/ Applicants
As regards the application by non-resident equity shareholders, the following further conditions
shall apply: Payment by non-residents must be made by demand draft / cheque payable at
Chennai or funds remitted from abroad in any of the following ways:
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Application with repatriation benefits
• By Indian Rupee drafts purchased from abroad and payable at Chennai or funds remitted from
abroad (submitted along with Foreign Inward Remittance Certificate); or
• By cheque / draft on a Non-Resident External Account (NRE) or FCNR Account maintained in
Chennai; or
• By Rupee draft purchased by debit to NRE/ FCNR Account maintained elsewhere in India and
payable in Chennai; or FIIs registered with SEBI must remit funds from special non-resident
rupee deposit account.
Application without repatriation benefits
As far as non-residents holding shares on non-repatriation basis is concerned, in addition to the
modes specified above, payment may also be made by way of cheque drawn on Non-Resident
(Ordinary) Account maintained in Chennai or Rupee Draft purchased out of NRO Account
maintained elsewhere in India but payable at Chennai. In such cases, the allotment of Equity
Shares will be on non-repatriation basis. All cheques/drafts submitted by non-residents should
be drawn in favour of the Bankers to the Issue and marked ‘Name of the Company A/c Apollo
Sindhoori Capital Investments Ltd. Rights Issue – NR’ payable at Chennai and must be crossed
‘A/c Payee only’ for the amount payable. The CAF duly completed together with the amount
payable on application must be deposited with the Collecting Bank indicated on the reverse of
the CAF before the close of banking hours on or before the Issue Closing Date. A separate cheque
or bank draft must accompany each CAF. Applicants may note that where payment is made by
drafts purchased from NRE/ FCNR/ NRO accounts as the case may be, an Account Debit
Certificate from the bank issuing the draft confirming that the draft has been issued by debiting
the NRE/ FCNR/ NRO account should be enclosed with the CAF. Otherwise the application
shall be considered incomplete and is liable to be rejected. New demat account shall be opened
for holders who have had a change in status from resident Indian to NRI.
Note:
• In case where repatriation benefit is available, interest, dividend, sales proceeds derived from
the investment in Equity Shares can be remitted outside India, subject to tax, as applicable
according to Income Tax Act, 1961.
• In case Equity Shares are allotted on non-repatriation basis, the dividend and sale proceeds of
the Equity Shares cannot be remitted outside India.
• The CAF duly completed together with the amount payable on application must be deposited
with the Collecting Bank indicated on the reverse of the CAF before the close of banking hours on
or before the Issue Closing Date. A separate cheque or bank draft must accompany each CAF.
• In case of an application received from non-residents, allotment, refunds and other distribution,
if any, will be made in accordance with the guidelines/ rules prescribed by RBI as applicable at
the time of making such allotment, remittance and subject to necessary approvals.
Disposal of application and application money
No acknowledgment will be issued for the application moneys received by the Company.
However, the Bankers to the Issue / Registrar to the Issue receiving the CAF will acknowledge its
receipt by stamping and returning the acknowledgment slip at the bottom of each CAF.
The Board reserves its full, unqualified and absolute right to accept or reject any application, in
whole or in part, and in either case without assigning any reason thereto.
In case an application is rejected in full, the whole of the application money received will be
refunded. Wherever an application is rejected in part, the balance of application money, if any,
after adjusting any money due on Equity Shares allotted, will be refunded to the applicant
within six weeks from the close of the Issue.
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For further instruction, please read the Composite Application Form (CAF) carefully.
Important
• Please read this Draft Letter of Offer carefully before taking any action. The instructions
contained in the accompanying Composite Application Form (CAF) are an integral part of the
conditions of this Draft Letter of Offer and must be carefully followed; otherwise the application
is liable to be rejected.
• All enquiries in connection with this Draft Letter of Offer or accompanying CAF and requests
for Split Application Forms must be addressed (quoting the Registered Folio Number/ DP and
Client ID number, the CAF number and the name of the first Equity Shareholder as mentioned on
the CAF and superscribed ‘Apollo Sindhoori Capital Investment Ltd. - Rights Issue’ on the
envelope) to the Registrar to the Issue at the following address:
Cameo Corporate Services Limited
Subramanian Building,
5th floor, No. 1 Club house road,
Chennai – 600 006.
Tel: (044) 28460390, Fax: (044) 28460129
• It is to be specifically noted that this Issue of Equity Shares is subject to the section entitled
‘Risk Factors’ beginning on page 4 of this Draft Letter of Offer. The Issue will not be kept open for
more than 30 days unless extended, in which case it will be kept open for a maximum of 60 days.
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WORKING RESULTS AND OTHER INFORMATION
1.
Working results of the company (un-audited) for the half year ended 30.9.2005 is given
below:
Particulars
Amount in
Rs. Million
256.0
71.8
10.4
61.4
19.9
41.5
Total Income
Profit Before Depreciation & Tax
Depreciation
PBT
Tax
Net Profit
2.
There are no material changes and commitments affecting the financial position of the
company since the date of the last Balance Sheet save as mentioned elsewhere in the Letter of
Offer.
3.
(a) Week-end Prices for the last four weeks is as follows:
BSE IndoNext
23.12.2005
229.95
30.12.2005
231.55
6.1.2006
234.15
13.1.2006
229.5
There was no trading on MSE during the last 4 weeks.
(c) Highest and lowest price during the last four weeks on BSE IndoNext
Week
High
Date of Volume Low (Rs.) Date of Volume Average
ending
(Rs.)
High
Low
on date of
on date of price for
high (no.
low (no.
the
period
of shares) (Rs.)
of shares)
23.12.2005
30.12.2005
6.1.2006
13.1.2006
236.45
231.55
234.15
231.75
19.12.05
30.12.05
6.1.06
9.1.06
1295
1899
2029
2631
229.95
225.2
231.7
228.9
23.12.05
26.12.05
5.1.06
12.1.06
2409
1778
528
1080
233.63
228.88
233.16
230.34
(d) Current price of the equity shares of the company on the BSE IndoNext as on 18.1.06
Rs.224.85/-.
PARTICULARS REGARDING LISTED COMPANIES UNDER
MADE CAPITAL ISSUES DURING THE LAST THREE YEARS
THE
SAME MANAGEMENT WHICH
HAVE
There are no listed companies under the same management within the meaning of Section
370(1B) of the Companies Act, 1956, which have come out with a Public or a Rights Issue.
Material Developments
In the opinion of the Directors, since the date of the last financial statements as disclosed in the
Draft Letter of Offer, no circumstances have arisen which materially and adversely affect or are
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likely to affect the trading or profitability of the company, or the value of its assets, or its ability to
pay its liabilities, within next twelve months.
EXPERT OPINION
Save and except as stated elsewhere in this Draft Letter of Offer, the company has not obtained
any expert opinions.
OPTION TO SUBSCRIBE
Other than the present Rights issue, the company has not given any option to subscribe for any
equity shares of the Company. As mentioned elsewhere, the investor shall have the option either
to receive the security certificates in physical form or to hold the securities with a depository in
electronic form.
124
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION
The contracts referred to below (not being contracts entered into in the ordinary course of
business carried on by the company or entered into more than two years prior to the date of the
Draft Letter of Offer) which are or may be deemed to be material have been entered into by the
company. Copies of these contracts, together with the copies of the documents referred to below,
may be inspected at the Registered and Head Office of the Company between 10.00 A.M. and
12.00 noon on any working day of the company from the date of the Letter of Offer until the date
of closing of the subscription list.
MATERIAL CONTRACTS
1.
Engagement letter dated 29.8.2005 received from the company appointing SBI Capital
Markets Ltd. to act as Lead Manager to the Issue. .
2.
The Memorandum of Understanding with the Lead Manager dated the 3.10.2005
3.
Letter from Cameo Corporate Services Ltd. dated 10.10.2005 offering their services to act as
Registrars to the Issue and the company's acceptance thereto.
4.
The Memorandum of Understanding between ASCIL and the Registrar to the Issue dated
5.10.2005.
MATERIAL DOCUMENTS
1.
Memorandum and Articles of Association of the company
2.
Certificate of Incorporation dated 4.7.1995 and Certificate of Commencement of Business
dated 4.7.1995
3.
Copy of the resolutions passed in the Board Meetings on 18.7.2005 approving the Rights
Issue.
4.
Power of Attorneys from all the directors of the company authorising any two of the
following three directors Mr. P. B Subramaniyan, Executive Director, Mr. K. Padmanabhan
and Mr. S K Venkataraman to sign the Offer document.
5.
Annual Reports of the company for the years 1999-2000, 2000-01, 2001-03, 2003-04 and 200405.
6.
The Auditors Certificate dated 18.10.05 as set out therein and their certificate of tax benefits
dated 18.10.05.
7.
Tripartite Agreement between the National Security Depository Ltd., The company and
Registrar dated 25.1.2000.
8.
Consent from R Subramanian & Company, the Auditors to the company, dated 4.10.05 for
inclusion of their report on the Accounts in the form and context in which they appear in the
Letter of Offer and also on the Tax Benefits mentioned therein.
9.
Consents in writing of the Directors, Company Secretary, Lead Manager, Legal Advisors,
Registrars and Bankers to the Issue as referred to in their respective capacities.
10. Resolution passed by the Board of Directors at their meeting held on 17.10.05 authorizing Mr.
P. B Subramaniyan, Executive Director and Mr. K. Padmanabhan, Director of the company to
carry out the necessary actions in respect to the Rights Issue for and on behalf of the Board.
125
11. Show cause notice issued by SEBI under Sub Regulation 2 of Regulation 13 of SEBI
(Procedure for holding Enquiry by Enquiry Officer and Imposing Penalty), 2002 and other
related correspondence with SEBI.
12. Copy of Registration certificate (No. INB230825534) with SEBI under the SEBI (Stock Brokers
and Sub Brokers Regulations), 1992, as Member for Capital Market segment on the National
Stock Exchange, dated 22.11.1995.
13. Copy of Registration certificate (No. INF231053936with SEBI under the SEBI (Stock Brokers
and Sub Brokers Regulations), 1992, as Trading Member for Futures and Options Segment on
the National Stock Exchange, dated 25.5.2000.
14. Copy of Registration certificate (No. INB010825538) with SEBI under the SEBI (Stock Brokers
and Sub Brokers Regulations), 1992, as Multiple Member on the Stock Exchange, Mumbai
dated 10.11.2000.
15. Copy of Registration certificate (No. INF010825538) with SEBI under the SEBI (Stock Brokers
and Sub Brokers Regulations), 1992, as Trading Member on the Stock Exchange, Mumbai
dated 2.6.2004.
16. Copy of Registration certificate (No. IN-DP-NSDL-141-2000) with SEBI under the SEBI
(Depositories and Participants) Regulations, 1996, as participant dated 22.9.2005.
17. Copy of Registration certificate (No. IN-DP-CSDL-254-2004) with SEBI under the SEBI
(Depositories and Participants) Regulations, 1996, as participant dated 23.6.2004.
126
DECLARATION
All the relevant provisions of the Act, and the guidelines issued by the Government or the
guidelines issued by SEBI established under the Securities and Exchange Board of India Act 1992,
as the case may be, have been complied with and no statement made in this Draft Letter of Offer
is contrary to the provisions of the Act or the Securities and Exchange Board of India Act, 1992 or
rules made there under or guidelines issued (including the SEBI Guidelines), as the case may be.
Yours faithfully
On behalf of the Board of Directors of Apollo Sindhoori Capital Investments Ltd.
Sd/Mrs. Suneeta Reddy (Chairperson)
Sd/Mr.P.B.Subramaniyan (Executive Director)
Sd/Mr.S.K.Venkataraman (Director)
Sd/Mr. S. Narayanan (Director)
Sd/Mr. V.J.Chakco (Director)
Sd/Mr K Padmanabhan (Director)
Place: Chennai
Dated: 18.1.2006
127