TRINETRA CEMENT LIMITED (Formerly Indo Zinc Limited)

DRAFT LETTER OF OFFER Dated: March 30, 2011 For Equity Shareholders of the Company only Private and Confidential TRINETRA CEMENT LIMITED (Formerly Indo Zinc Limited)

(Our company was originally incorporated as a Private Limited Company on March 12, 1987 under the Companies Act, 1956 as Indo Zinc Private Limited. Our Company was converted into a public limited company and a fresh certificate of incorporation was issued by the Registrar of Companies, Mumbai on January 20, 1992 under the name and style of Indo Zinc Limited. The name of our Company was further changed from Indo Zinc Limited to Trinetra Cement Limited and consequently, a fresh certificate of incorporation was issued by the Deputy Registrar of Companies, Maharashtra on March 18, 2011. The Corporate Identification Number of the Company is L99999MH1987PLC042858. For further details of change of name and registered office of our Company, please refer to the section titled “History and Other Corporate Information” beginning on Page 70 of this Draft Letter of Offer. Registered Office: No. 8, 2nd Floor, Kamanwala Chambers, Opp Bombay Stores, Sir P M Road, Fort, Mumbai – 400 001 Corporate Office: ‘Coromandel Towers', 93, Santhome High Road, Karpagam Avenue, R A Puram Chennai - 600028. Tel: +91 44 2852 1526, 2857 2100, 2857 2400 Fax:+91 44 2851 7198 E-mail: [email protected] Contact Person: Shri S Sridharan, Company Secretary and Compliance Officer PROMOTER OF THE COMPANY: ICL FINANCIAL SERVICES LIMITED, the wholly owned subsidiary of THE INDIA CEMENTS LIMITED DRAFT LETTER OF OFFER SIMULTANEOUS BUT UNLINKED ISSUE OF 4,92,31,600 EQUITY SHARES OF RS. 10/- EACH AT A PRICE OF RS. 22.50/- (INCLUDING SHARE PREMIUM OF RS. 12.50) PER FULLY PAID EQUITY SHARE AGGREGATING RS. 110.77 CRORE IN THE RATIO OF 11 EQUITY SHARES FOR EVERY EQUITY SHARE HELD BY THE EXISTING SHAREHOLDERS ON THE RECORD DATE, i.e. *●+ AND ISSUE OF 1,79,02,400 OPTIONALLY CONVERTIBLE REDEEMABLE PREFERENCE SHARES OF RS.100/- EACH AT A PRICE OF RS. 100/-, AGGREGATING RS. 179.02 CRORE ON RIGHTS BASIS TO THE EXISTING SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF 4 OPTIONALLY CONVERTIBLE REDEEMABLE PREFERENCE SHARES FOR EVERY EQUITY SHARE HELD BY THE EXISTING SHAREHOLDERS ON THE RECORD DATE, THAT IS ON *●+ (“THE ISSUE”). THE TOTAL PROCEEDS FROM THE ISSUE OF EQUITY SHARES AND OPTIONALLY CONVERTIBLE REDEEMABLE PREFERENCE SHARES WOULD AGGREGATE TO Rs. 289.79 CRORE. THE ISSUE PRICE OF THE EQUITY SHARES IS 2.25 TIMES THEIR FACE VALUE AND THE ISSUE PRICE OF THE OPTIONALLY CONVERTIBLE REDEEMABLE PREFERENCE SHARES IS THE FACE VALUE. GENERAL RISKS Investments in equity and equity related securities involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their investment. Investors are advised to read the Risk Factors carefully before taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of the Issuer and the Issue including the risks involved. The securities have not been recommended or approved by the Securities and Exchange Board of India (SEBI) nor does SEBI guarantee the accuracy or adequacy of this document. Investors are advised to refer to the section titled “Risk Factors” beginning on page x of this Draft Letter of Offer before making an investment in this Issue. OUR COMPANY’S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that this Draft Letter of Offer contains all information with regard to the Issuer and the Issue, which is material in the context of this Issue, that the information contained in this Draft Letter of Offer is true and correct in all material aspects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this Draft Letter of Offer as a whole or any such information or the expression of any such opinions or intentions misleading in any material respect. LISTING The Equity Shares of our Company are listed on Bombay Stock Exchange Limited, Ahmedabad Stock Exchange Limited, Madhya Pradesh Stock Exchange Limited and The Delhi Stock Exchange Limited. Equity Shares issued pursuant to the Issue shall be listed only on the BSE. Our Company has received in- principle approval from BSE, which is the Designated Stock Exchange, vide its letter dated *●+, granting in-principle approval for listing the Equity Shares. The OCRPS shall not be listed on any stock exchanges. ` LEAD MANAGER TO THE ISSUE REGISTRAR TO THE ISSUE MAPE Advisory Group Private Limited Integrated Enterprises (India) Limited SEBI Regn No: INR 000000544 SEBI Regn. No. INM 000011294 7C, P M Towers, Greams Road 2nd Floor, "Kences Towers", Chennai - 600006 No.1, Ramakrishna Street, Tel: +91 44 2829 5378 North Usman Road, T.Nagar, Fax: +91 44 2829 5377 Chennai – 600017 Email: [email protected] Tel:+91 44 2814 0801/2/3 Website: www.mapegroup.com Fax:+91 44 28142479 Email: [email protected] Contact Person: Pravin Rajendran Website: www.iepindia.com Contact Person: K. Suresh Babu ISSUE PROGRAMME ISSUE OPENS ON LAST DATE FOR RECEIVING REQUEST OF SPLIT ISSUE CLOSES ON APPLICATION FORMS *●+ *●+ *●+

TABLE OF CONTENTS SECTION I – DEFINITIONS AND ABBREVIATIONS ...... i DEFINITIONS AND ABBREVIATIONS ...... i CERTAIN CONVENTIONS...... viii SECTION II – RISK FACTORS ...... ix RISK FACTORS ...... x SECTION III - INTRODUCTION ...... 1 THE ISSUE ...... 2 INDUSTRY OVERVIEW ...... 3 BUSINESS OVERVIEW ...... 5 SUMMARY STATEMENTS OF FINANCIAL INFORMATION ...... 8 GENERAL INFORMATION ...... 13 CAPITAL STRUCTURE ...... 21 OBJECTS OF THE ISSUE ...... 30 BASIS FOR ISSUE PRICE ...... 33 STATEMENT OF TAX BENEFITS ...... 36 SECTION IV – ABOUT US...... 45 CEMENT INDUSTRY ...... 45 OUR BUSINESS ...... 51 KEY INDUSTRY REGULATIONS AND POLICIES ...... 61 HISTORY AND OTHER CORPORATE INFORMATION ...... 70 OUR MANAGEMENT ...... 75 OUR PROMOTER AND PROMOTER GROUP ...... 90 SECTION V- FINANCIAL INFORMATION ...... 95 FINANCIAL STATEMENTS ...... 95 FINANCIAL INFORMATION OF GROUP COMPANIES ...... 125 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS ...... 142 STOCK MARKET DATA FOR EQUITY SHARES OF THE COMPANY ...... 151 FINANCIAL INDEBTEDNESS ...... 153 SECTION VI- LEGAL AND OTHER INFORMATION ...... 155 OUTSTANDING LITIGATIONS AND MATERIAL DEVELOPMENTS ...... 155 GOVERNMENT AND OTHER APPROVALS ...... 165 SECTION VII – OFFERING INFORMATION ...... 177 TERMS OF THE ISSUE...... 177 ISSUE PROCEDURE ...... 187 MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION ...... 217 MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION ...... 231 DECLARATION ...... 233

SECTION I – DEFINITIONS AND ABBREVIATIONS

DEFINITIONS AND ABBREVIATIONS

In this Draft Letter of Offer, the terms “we”, “us”, “our”, “the Company”, “our Company” or “TCL” unless the context otherwise implies, refer to Trinetra Cement Limited. All references to “Rs.” or “INR” refer to Rupees, the lawful currency of India. References to the singular also refers to the plural and one gender also refers to any other gender, wherever applicable.

The words “Lakh” or “Lac” or “Lacs” mean “100 thousand” and the words “million” or “millions” or “mn” mean “10 lakhs” and the words “crore” or “cr” mean “10 million” or “100 lakhs” and the words “billion” or “billions” or “bn” mean “1,000 million” or “100 crore”. Any discrepancies in any table between the total and the sums of the amounts listed are due to rounding off.

DEFINITIONS

Term Description “The Issuer” or “The Unless otherwise specified these references means Trinetra Cement Company” or Limited, a public limited company incorporated under the Companies “Trinetra Cement Act, 1956. Limited” or “TCL” or “Indo Zinc Limited” or “IZL” or “We” or “us” or “Our” or “Our Company

Issuer related terms

Terms Description Articles / Articles of Articles of Association of our Company, as amended Association Statutory Auditors to The Statutory Auditors of our Company, M/s. Chaturvedi SK & the Company / our Fellows, Chartered Accountants Statutory Auditors Board/Board of Board of Directors of our Company including a duly constituted Directors committee thereof ‘Coromandel Towers', 93, Santhome High Road, Karpagam Avenue, Corporate Office R A Puram Chennai - 600028. Directors Directors of Trinetra Cement Limited, unless otherwise specified Key Management Those individuals described in the section “Our Management” on Personnel page no. 75 of this Draft Letter of Offer

Memorandum / Memorandum of Memorandum of Association of our Company, as amended Association Promoter(s) ICL Financial Services Limited (ICLFSL) Registered Office of our No. 8, 2nd Floor, Kamanwala Chambers, Opp Bombay Stores, Sir P M Company Road, Fort, Mumbai – 400 001 Our cement manufacturing plant with a production capacity of 1.5 Our “Plant” MTPA, located at Banswara, Rajasthan The area of land admeasuring 65.82 hectares, for which we have lease Our “Mine” for 20 years for mining of limestone and other minerals, at Jhalo ka Gara, Banswara, Rajasthan

General Terms / Issue Related Terms

Term Definition Companies Act The Companies Act, 1956 and amendments thereto from time to time Abridged Letter of The abridged letter of offer to be sent to our Equity Shareholders as Offer on the Record Date with respect to this Issue in accordance with SEBI (ICDR) Regulations AS Accounting Standards issued by the Institute of Chartered Accountants of India Application Supported The application (whether physical or electronic) used by an Investor to by Blocked Amount / make an application authorizing the SCSB to block the amount payable ASBA on application in their specified bank account ASBA Investor An applicant who intends to apply through ASBA Process and holds the shares of the Company in dematerialized form as on the Record Date and has applied for entitlements and / or additional shares in dematerialised form; has not renounced his / her entitlements in full or in part; is not a Renouncee, and is applying through a bank account maintained with SCSBs. Articles/AOA Articles of Association of our Company, as amended from time to time Auditors to the Issue M/s DPH & Co., Chartered Accountants Bankers/ Lenders to Axis Bank Limited, Yes Bank Limited, Infrastructure Development the Company Finance Company Limited and UCO Bank Bankers to the Issue *●+ Board or Board of Board of Directors of our Company Directors Collection Centres Locations where Investors may submit their application forms, the list of which is mentioned in the CAF Consolidated In case of physical certificate, our Company would issue one certificate Certificate for the Equity Shares allotted in one folio Designated Branches Such branches of the SCSBs which shall collect CAF from ASBA Investor and a list of which is available on http://www.sebi.gov.in/pmd/scsb.pdf Designated Stock Bombay Stock Exchange Limited Exchange

Draft Letter of Draft Letter of Offer of our Company dated March 30, 2011 Offer/DLOO Equity Share(s) Equity Shares of our Company of face value of Rs.10/- each, unless otherwise specified in the context thereof. Equity Shareholder(s) A holder of Equity Shares of our Company Group Companies Companies, firms, ventures, etc. promoted by ICLFSL, our Promoter and India Cements, the promoter of ICLFSL Investor(s) Equity Shareholder as on the Record Date, i.e. *•+ and Renouncee(s) Fiscal/FY Financial Year Ending March 31 of that year Indian GAAP Generally Accepted Accounting Principles of India ISIN International Securities Identification Number Issue / Rights Issue Simultaneous but unlinked issue of 4,92,31,600 Equity Shares of Rs. 10/- each at a price of Rs. 22.50 (including share premium of Rs. 12.50) per fully paid equity share aggregating Rs. 110.77 crore in the ratio of 11 equity shares for every Equity Share held by the existing shareholders on the record date , i.e. *●+ and issue of 1,79,02,400 OCRPS of Rs.100/- each at a price of Rs. 100/- aggregating Rs.179.02 crore on rights basis to the existing shareholders of our company in the ratio of 4 OCRPS for every Equity Share held by the existing shareholders on the record date, that is on *●+.( “the Issue”). Issue Account Account opened with the Banker(s) to the Issue to receive monies from the Escrow Account for the issue on the designated date Issue Opening Date *●+ Issue Closing Date *●+ Income Tax Act/IT Act The Income Tax Act, 1961 and amendments thereto Lead Manager/ MAPE Advisory Group Private Limited Manager to the Offer Letter of Offer/LOO Letter of Offer circulated to the shareholders of our company Listing Agreement(s) The listing agreements entered into between the Company and the Stock Exchanges Lenders Memorandum Memorandum of Association of our Company, as amended NCRPS 9% Cumulative Non-Convertible Redeemable Preference Shares of Rs. 100 each of the Company OCRPS 9% Cumulative Optionally Convertible Redeemable Preference Shares of Rs. 100 each of the Company, issued in the Issue Preference Shares Preference Shares of the Company of Rs. 100 each. The Preference Shares include both OCRPS and NCRPS Promoter ICL Financial Services Limited Record Date *●+ Refund through Refunds through ECS/NECS, Direct Credit, RTGS or NEFT, as applicable electronic transfer of funds Refund Banker *●+ Registrar to the Issue Integrated Enterprises (India) Limited or Registrar / Transfer Agent

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Registrar of Companies Registrar of Companies, Maharashtra located at Everest, / RoC 100 Marine Drive, Mumbai – 400 002, Maharashtra, India Renouncees The persons who have acquired Rights Entitlement from the existing Equity Shareholders Rights Entitlement The number of securities that a shareholder is entitled to in proportion to his / her shareholding in our Company as on the Record Date i.e. *●+ Self Certified Syndicate The banks which are registered with SEBI under the SEBI (Bankers to Bank or SCSB an Issue) Regulations, 1994 and offers services of ASBA, including blocking of bank account and a list of which is available on http://www.sebi.gov.in/pmd/scsb.html SEBI Act, 1992 The Securities and Exchange Board of India Act, 1992 and amendments thereto SEBI DIP Guidelines / Securities and Exchange Board of India (Disclosure and Investor SEBI Guidelines Protection) Guidelines, 2000 issued by SEBI on January 19, 2000 and amendments thereto. The SEBI DIP Guidelines have been repealed and have been replaced by the SEBI (ICDR) Regulations SEBI (ICDR) The Securities and Exchange Board of India (Issue of Capital and Regulations Disclosure Requirements) Regulations, 2009, as amended from time to time. SEBI (SAST) Securities and Exchange Board of India (Substantial Acquisition of Regulations / SAST / Shares and Takeovers) Regulations, 1997 and subsequent SEBI Takeover amendments thereto. Code / Takeover Code Securities Equity Shares and/or OCRPS offered in the Issue Share Issue Committee A sub-committee of our Board of Directors, constituted on February 10, 2011 Stock Exchange(s) BSE, ASE, DSE and MPSE, where the Equity Shares of our Company are presently listed.

Industry Related Terms

Term Definition Mt / MT /mt Million tonnes Mtpa/MTPA Million tonnes per annum Tpa Tonnes per annum MMDR Act The Mines and Minerals (Development and Regulation) Act, 1957 OPC Ordinary Portland Cement PPC Portland Pozzolona Cement

ABBREVIATIONS

Term Definition AGM Annual General Meeting Approx. Approximately

APTransco Transmission Corporation of Andhra Pradesh Limited ASE Ahmedabad Stock Exchange Limited AS Accounting Standards, as issued by the Institute of Chartered Accountants of India BIFR Board for Industrial and Financial Reconstruction BSE Bombay Stock Exchange Limited CAF Composite Application Form CAGR Compounded Annual Growth Rate CEPS Cash Earnings Per Share CDSL Central Depository Services (India) Limited CIN Corporate Identification Number CSL Coromandel Sugars Limited CECL Coromandel Electric Company Limited CESTAT Customs, Excise and Service Tax Appellate Tribunal CMA Cement Manufacturers’ Association CTL Coromandel Travels Limited DP Depository Participant DSE The Delhi Stock Exchange Limited ECS/NECS Electronic Clearing Service / National Electronic Clearing Service EGM Extraordinary General Meeting EPS Earnings Per Share FDI Foreign Direct Investment FEMA Foreign Exchange Management Act, 1999 FII(s) Foreign Institutional Investors registered with SEBI under applicable laws FIPB Foreign Investment Promotion Board, Ministry of Finance, Government of India GOI/GoI Government of India GO Government Order HUF Hindu Undivided Family ICAI The Institute of Chartered Accountants of India ICLFSL ICL Financial Services Limited India Cements The India Cements Limited ICCL India Cements Capital Limited ICLI ICL International Limited ICML Industrial Chemicals and Monomers Limited ICLSL ICL Shipping Limited ICLSec ICL Securities Limited LTCG Long Term Capital Gains MoEF Ministry of Environment and Forests MoU Memorandum of Understanding MPSE Madhya Pradesh Stock Exchange Limited MRTP Commission Monopolies and Restrictive Trade Practices Commission NCAER National Council of Applied Economic Research NR Non Resident

NRI(s) Non Resident Indian(s) NSDL National Securities Depository Limited OCBs Overseas Corporate Bodies PAN Permanent Account Number allotted under the Income Tax Act, 1961 PAT Profit After Tax PBT Profit Before Tax RBI Reserve Bank of India RCL Raasi Cement Limited RoC Registrar of Companies Re/Rs/Rupees/INR Indian Rupees SAF Split Application Form SICA Sick Industrial Companies (Special Provisions) Act, 1985 SEBI Securities and Exchange Board of India STCG Short Term Capital Gains TCPL Trishul Concrete Products Limited URMPL Unique Receivable Management Private Limited

Notwithstanding the above:

(i) In the section titled “Main Provisions of the Articles of Association of Our Company, beginning on Page 217 of this Draft Letter of Offer, defined terms shall have the meaning given to such terms in that section.

(ii) In the section titled “Financial Information” beginning on Page 95 of this Draft Letter of Offer, defined terms shall have the meaning given to such terms in that section.

(iii) In the paragraphs titled “Disclaimer Clause of Securities and Exchange Board of India” and “Disclaimer Clause of Bombay Stock Exchange Limited” in the section “Other regulatory and statutory disclosures” on page 168 of this Draft Letter of Offer, defined terms shall have the meaning given to such terms in those paragraphs.

NO OFFER IN OTHER JURISDICTIONS

The rights entitlement and Equity Shares of our Company have not been and may not be offered or sold, directly or indirectly, and this Draft Letter of Offer may not be distributed in any jurisdiction outside India. Receipt of this Draft Letter of Offer will not constitute an offer in those jurisdictions in which it would be illegal to make such an offer and, those circumstances, this Draft Letter of Offer must be treated as sent for information only and should not be copied or redistributed. No person receiving a copy of this Draft Letter of Offer in any territory other than in India may treat the same as constituting an invitation or offer to him, nor should he in any event use the CAF. The Company will not accept any CAF where the address as indicated by the applicant is not an Indian address. Accordingly, persons receiving a copy of this Draft Letter of Offer should not, in connection with the Issue of Equity Shares and OCRPS (collectively called as “the Securities”) or the rights entitlements, distribute or send the same in or into the United States or any other jurisdiction where to do so would or might contravene local securities laws or regulations. If this Draft Letter of Offer is received by any person in any such territory, or by their agent or nominee, they must not seek to subscribe to the securities or the rights entitlements referred to in this Draft Letter of Offer.

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CERTAIN CONVENTIONS Financial Data

Unless stated otherwise, the financial data in this Draft Letter of Offer is derived from our restated financial statements for the financial years ended March 31, 2010, 2009, 2008, 2007 and 2006 and for the 6 months ended September 30, 2010, prepared in accordance with Indian GAAP and the Companies Act restated in accordance with SEBI Regulations, as stated in the joint report of our Statutory Auditors, M/s Chaturvedi SK & Fellows, and Auditors to the Issue, M/s DPH & Co., beginning on page 95 of this Draft Letter of Offer.

Our fiscal year commences on April 1 and ends on March 31 of a particular year. Unless stated otherwise, references herein to a fiscal year (e.g., fiscal 2008), are to the fiscal year ended March 31 of that year.

In this Draft Letter of Offer, any discrepancies in any table between the total and the sums of the amounts listed are due to rounding-off, and unless otherwise specified, all financial numbers in parenthesis represent negative figures. Unless stated otherwise, industry data used throughout this Draft Letter of Offer has been obtained from industry publications. Industry publications generally state that the information contained in those publications has been obtained from sources believed to be reliable but that their accuracy and completeness are not guaranteed and their reliability cannot be assured. Although we believe that industry data used in this Draft Letter of Offer is reliable, it has not been independently verified.

CURRENCY OF PRESENTATION

In the Draft Letter of Offer, unless the context otherwise requires, all references to the words “Lakh” or “Lac” or “Lacs” mean “100 thousand” and the word “million” or “millions” or “mn” means “10 lakhs” and the word “crore” or “cr” means “10 million” or “100 lakhs” and the word “billion” or “billions” or “bn” means “1,000 million” or “100 crore”.

Further, any discrepancies in any table between the total and the sum of the amounts are due to rounding-off.

All references to “India” contained in this Draft Letter of Offer are to the Republic of India.

All references to “Rupees” or “Rs.” or “INR” are to Indian Rupees, the official currency of the Republic of India.

MARKET DATA

Market and industry data used throughout this Draft Letter of Offer has been obtained from publications (including websites) available in public domain and internal company reports. These publications generally state that the information contained in those publications has been obtained from sources believed to be reliable but that their accuracy and completeness are not guaranteed and their reliability cannot be assured. Although we believe that the market data used in this Draft Letter of Offer is reliable, it has not been independently verified. Similarly, internal company reports, while believed to be reliable, have not been verified by any independent source.

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SECTION II – RISK FACTORS FORWARD LOOKING STATEMENTS

We have included statements in this Draft Letter of Offer which contain words or phrases such as “will”, “may”, “aim”, “is likely to result”, “believe”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “future”, “objective”, “goal”, “project”, “should”, “will pursue” and similar expressions or variations of such expressions, that are “forward-looking statements”.

All forward looking statements are subject to risks, uncertainties and assumptions about us that could cause actual results to differ materially from those contemplated by the relevant forward- looking statement. Important factors that could cause actual results to differ materially from our expectations include but are not limited to:

 General economic and business conditions in the markets in which we operate and in the local, regional, national and international economies;  Changes in laws and regulations relating to the sectors/areas in which we operate;  Increased competition in the sectors/areas in which we operate;  Our ability to successfully implement our growth strategy and expansion plans, and to successfully launch and implement various projects and business plans for which funds are being raised through this Issue;  Our ability to meet our capital expenditure requirements;  Fluctuations in operating costs;  Our ability to attract and retain qualified personnel;  Changes in political and social conditions in India or in countries that we may enter, the monetary and interest rate policies of India and other countries, inflation, deflation, unanticipated turbulence in interest rates, equity prices or other rates or prices; and  The performance of the financial markets in India and globally.

Neither we, our Directors, the Lead Manager, nor any of its affiliates have any obligation to update or otherwise revise any statements reflecting circumstances arising after the date hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come to fruition. In accordance with SEBI requirements, our Company, the Lead Manager will ensure that investors in India are informed of material developments until such time as the grant of listing and trading permission by the Stock Exchanges for the Equity Shares being offered on a rights basis.

For a further discussion of factors that could cause our actual results to differ, see the chapters titled “Risk Factors” “Our Business” and “Management’s Discussion and Analysis of Financial Condition And Results of Operations” beginning on pages x, 51 and 142 of this Draft Letter of Offer respectively. By their nature, certain market risk disclosures are only estimates and could be materially different from what actually occurs in the future. As a result, actual future gains or losses could materially differ from those that have been estimated.

RISK FACTORS

An investment in Equity Shares or Equity linked securities involves a high degree of risk. You should carefully consider all of the information in this draft Letter of Offer, including the risks and uncertainties described below, before making an investment in our Company’s securities. To obtain a complete understanding of our business, you should read this section in conjunction with “Our Business” on page 51 and “Management’s Discussion and Analysis on Results of Operations and Financial Conditions” on page 142. Any of the following risks as well as other risks and uncertainties discussed in this draft Letter of Offer could have a material adverse impact on our business, financial condition and results of our operation and could cause the trading price of our Equity Shares to decline which could result in the loss of all or part of your investment.

The Draft Letter of Offer also contains forward looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including the considerations described below and elsewhere in this draft Letter of Offer.

Unless specified or quantified in the relevant risk factors below, we are not in a position to quantify the financial or other implications of any of the risks described in this section.

Materiality:

The risk factors have been determined on the basis of their materiality. The following factors have been considered for determining their materiality:

1. Some events may not be material individually but may be found material collectively.

2. Some events may have a material impact qualitatively instead of quantitatively.

3. Some events may not be material at present but may have material impacts in the future.

Internal Risk Factors

1. We have undergone significant financial restructuring in the last decade, including admission to the Board for Industrial and Financial Reconstruction

As a result of financial difficulties and inability to repay our lenders, our Company was declared a sick industrial company under the Sick Industrial Companies (Special Provisions) Act, 1985 in the hearing held on January 18, 2000 and registered with the Board for Industrial and Financial Reconstruction. We have since fully discharged our dues and liabilities towards our lenders – Industrial Development Bank of India, Life Insurance Corporation of India and State Bank of India in the financial year ending March 31, 2008 and in view of our net-worth exceeding the accumulated losses, BIFR, vide order dated March 17, 2009 discharged our Company from the purview of the BIFR.

A large portion of the construction cost of our Plant has been funded through term loans from banks and financial institutions and unsecured loans from India Cements. We cannot guarantee that our Company would be able to repay all its debts on time and would not have to be admitted to the BIFR again.

2. The deployment of funds is entirely at our discretion and no independent agency has been appointed to monitor its deployment

As per SEBI (ICDR) Regulations, appointment of monitoring agency is required only for Issues where the amount raised through allotment is over Rs. 500 Crore. Since the amount raised by the Company in the Issue is below Rs. 500 Cr., it is not mandatory for us to appoint a monitoring agency. Hence, we have not appointed any monitoring agency to monitor the utilization of Issue proceeds. The deployment of funds towards the objects of the Issue is entirely at the discretion of our Board of Directors and is not subject to monitoring by external independent agency. However, the deployment of funds towards the object of the Issue will be monitored by our audit committee and the Company shall inform about material deviations in the utilization of issue proceeds, if any, to the stock exchange and provide the details in the Balance Sheet about the same.

3. A significant portion of the Issue Proceeds is being paid to our Promoter/ Promoter Group entities as repayment of unsecured loan.

The Issue proceeds, net of Issue related expenditure, is proposed to be utilized for repayment of unsecured loans obtained from our Promoter/Promoter Group entities. In order to partly fund the construction of our Plant at Banswara, Rajasthan and subsequently for maintaining operations, our Promoter/Promoter Group entities, as on January 31, 2011, advanced a sum of Rs 591.66 Cr. (including principal amount and accrued interest) as short term unsecured loan which is proposed to be partly repaid out of the proceeds of the Issue. For further details please refer to the section “Objects of the Issue” beginning on Page 30 and the section “Financial Indebtedness” beginning on Page 153 of this Draft Letter of Offer.

4. Our Company requires continuity in terms of mining/procuring adequate limestone for its business and any disruption in its supply, could adversely affect our manufacturing activities.

Limestone is the core material for the production of cement. Our Company meets its requirement for limestone from our Mine, situated near our Plant at Banswara, Rajasthan. As per the report of Holtec Consulting Private Limited, the total reserves available at the limestone mines are approximately 38 MT. The Mine’s lease is granted to our Company for a term of 20 years in 1996 and in accordance with the current provisions of the MMDR Act and the Mineral Concession Rules 1960 , this lease can be renewed for a term of 20 years at a time.

Mining rights are subject to compliance with certain conditions. State and Central Governments have the authority to take action in terms of mining rights, including fines or restrictions

imposition, revoking the mining rights or change of the royalty amount payable by our Company towards mining. There can be no guarantee that mining royalties are likely to remain unchanged, or increased. Our Company believes that our mining rights are adequate to meet current and projected production levels. However, if our mining rights are revoked or not renewed upon expiration, or restrictions on rights usage are imposed or royalties are increased or applicable environmental standards are substantially increased, our capacity to operate the plant adjacent to the affected mining sites could be impacted until alternative limestone sites are determined. This can affect our financial status.

5. The actual limestone reserves available with us can be lower than estimates.

There are numerous uncertainties inherent in estimating quantities of reserves, including many factors beyond our control. The reserve data set forth in this Draft Letter of Offer represent estimates determined by independent consultants or ourselves. In general, estimates of reserves are based upon a number of variable factors and assumptions, such as geological and geophysical characteristics of the reserves, historical production performance from the properties, the quality and quantity of technical and economic data, extensive engineering judgments, the assumed effects of regulation by Central Government agencies and future operating costs. All such estimates involve uncertainties, and classifications of reserves are only attempts to define the degree of likelihood that the reserves will result in revenue for us. For those reasons, estimates of the economically recoverable reserves attributable to any particular group of properties and classification of such reserves based on risk of recovery, prepared by different engineers or by the same engineers at different times, may vary substantially. In addition, such estimates can be and will be subsequently revised as additional pertinent data becomes available prompting revision. Actual reserves may vary significantly from such estimates. To the extent actual reserves is significantly less than our estimates, our financial conditions and results of operations are likely to be materially and adversely affected.

6. The business of our Company may be negatively impacted if it is not able to put up a captive power facility as planned.

Availability of electricity, and at low cost, is expected to have a significant effect on our future financial performance. Our Plant currently meets its power requirement by purchasing electricity from the Rajasthan state electricity board. The captive power plant, of a capacity of 20 MW, which is currently under construction and is expected to be operational by June 2011, shall be sufficient to meet the present power requirements of our Plant. If we are not able to put up the captive power plant as planned, we may have to source power from other sources, which may increase the cost of production and in turn affect our future profitability.

7. The operations of our Company depend upon continued supply of coal, fly ash and other raw materials and any delay in procuring these materials or at a reasonable cost could adversely impact our operations.

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Our Company obtains its requirement of limestone from its leased Mine. However, we depend on a variety of suppliers to meet our requirement of the other raw materials, like gypsum, fly ash, laterite, etc. Further, we currently use coal which is imported from South Africa by us or by other third parties. If our Company is not able to obtain sufficient raw materials or fuel in a continued manner at a reasonable cost, the future operations and profitability of our Company may be materially affected.

8. Our Company does not own a brand and the brand used for its products is owned by our ultimate promoter, The India Cements Limited

Our Company does not own a brand of its own and has entered into an agreement with India Cements to produce and sell our cement under the brand name “Coromandel”, which is owned by them, for a period of three years. In case the agreement is not renewed after expiry, we may have to undergo a branding exercise, which would include significant advertising and promotional expenditures. Further, our new brand may not command the same recall as ‘Coromandel’. This may negatively affect our ability to sell our product to the end consumer. For further details regarding the terms and conditions of the agreement with India Cements, please refer to “History and other Corporate Information” on page 70 of this Draft Letter of Offer.

9. We currently do not have a marketing and distribution system of our own and rely on the distribution channel of India Cements.

We are a recent entrant in the cement manufacturing and distribution business and do not have a ready marketing channel of our own. We have signed a Marketing Agreement with India Cements whereby we sell our cement under the brand “Coromandel”, which is owned by them, and also utilize their dealer network to sell our stock. However, in case the Marketing Agreement is not extended beyond its expiry, and we have not been able to set up a reliable dealer network of our own by then, we may not be able to sell our produce and our revenues, cash cycle and profitability may be affected negatively. For further details, please refer to the section, ‘Our Business’ on page 51 of the Draft Letter of Offer.

10. Our Company has availed unsecured loans which are repayable on demand. Any demand from the lenders for repayment of such unsecured loan may affect our cash flow and financial condition

As on January 31, 2011, our Company has availed Rs 591.66 Cr. (including principal and accrued interest) from India Cements as unsecured loans. For further details with regard to the terms of these loans please refer to the section “Financial Indebtedness” on Page 153 of this Draft Letter of Offer.

These unsecured loans are repayable on demand and India Cements may ask for repayment of this loan at any such time as per its requirement. We currently do not have sufficient internal cash flows to repay such amount at short notice. Any demand for the repayment of such unsecured loan, may adversely affect our cash flow, credit history and financial condition.

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11. Our Company’s reliance on our ultimate promoter is large, and any inability on the part of the promoters to contribute to the growth of our Company may adversely affect our Company’s operations.

Our Company relies on the efforts of our ultimate promoter, India Cements, for implementation and resumption of business activities. The construction of the Plant was part funded by unsecured loans provided by India Cements. We currently use a brand and the dealer network of India Cements for the marketing of our products, and we also utilize the managerial abilities of senior management of India Cements. Any inability on the part of India Cements to continue contributing to the growth of our Company may severely impact operations and future financial condition.

12. The agreements entered into by us with our lending institutions have certain restrictive covenants

Many of our financing agreements also include various conditions and covenants that require us to obtain lender consents prior to carrying out certain activities and entering into certain transactions. These include, among other things, undertaking new projects, issuing new securities, alteration of Articles and Memorandum, declaring dividends in the event of non- payment and making certain investments beyond the approved amount. Such provisions are common in financing agreements with Indian lenders and are generally imposed on Indian borrowers, including ourselves, with little or no variation. For further details regarding our indebtedness and major restrictive covenants applicable to us, please refer to the section “Financial Indebtedness” on page 153 of this Draft Letter of Offer.

Any failure to comply with the requirement to obtain a lender consent, or other condition or covenant under the financing agreements that is not waived by the lenders or is not otherwise obtained by us, may lead to a termination of our credit facilities, acceleration in payment of all amounts due, in whole or in part, under such facilities along with related costs and trigger cross default provisions under certain of our other financing agreements, and may adversely affect our ability to conduct our business and operations or implement our business plans. Further, during any period in which we are in default, we may be unable to raise, or face difficulties raising, further financing. If the obligations under any of the financing agreements are accelerated or if the lenders of a material amount of the outstanding loans declare an event of default simultaneously, we may be unable to pay our debts as they fall due.

13. Our Promoter has pledged a majority of its shareholding in our Company with financial institutions. Any default on the part of the Promoter may result in a change in management control of our Company.

Our Promoter, ICL Financial Services Ltd., has pledged 22,95,600 Equity shares constituting 83.78% of its holding and 51.29% of the total share capital of our Company, with Axis Trustee

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Services Limited against certain loans taken by our Company. Any default to the terms of the loan documents on the part of either ICLFSL or our Company may result in invocation of the pledge and subsequent change in majority shareholding of the Company.

14. Our Company has certain contingent liabilities in the form of capital commitments.

As of September 30, 2010, contingent liabilities according to our Company’s financial statements aggregated Rs. 16071 Lakhs on account of estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for. For further details, please refer to the section titled “Financial Statements” on page 95 of the Draft Letter of Offer.

15. Our Company has had periods of Negative Cash Flows.

In recent years, our Company has reported negative cash flows during the year ended March 31, 2008 and the six month period ending September 30, 2010. While our Company has had positive cash flows in the years ending March 31, 2009 and 2010, it is largely because of external funding in the form of secured and unsecured loans. There is no guarantee that in subsequent years, we will not have periods of negative cash flows, which may impair our ability to continue successful operations of our Company.

16. We have engaged in Related Party Transactions.

We have entered into a number of related party transactions, including receiving loans and advances from our Promoter Group entities. As at September 30, 2010, loans and advances from our ultimate promoter, India Cements amounted to Rs. 588.85 Cr. For further details, please refer to “Related Party Transactions” in the section “Financial Statements” on page 95 of the Draft Letter of Offer.

Whilst we comply with Indian accounting and regulatory standards in entering into related party transactions, such standards may not be comparable with standards of other countries such as the United States. For example, Indian regulatory standards do not require independent valuations or approvals from disinterested shareholders with respect to significant connected party transactions.

17. Statutory and regulatory permits and approvals required for continuous operations of our Plant or business may not be renewed, on time or at all, thereby affecting our future business operations.

The Company requires certain statutory and regulatory permits and approvals for its business. There can be no assurance that the relevant authorities will issue such permits or renewals in the time frame anticipated by the Company or at all. Failure by the Company to renew, maintain or obtain the required permits or approvals or renewals may result in the interruption of operations and may have a material adverse effect on the Company’s business, financial condition and results of operations. Additionally, the Company is required to adhere to certain terms and conditions provided for under the statutory and regulatory permits and approvals and any failure in adhering to such terms may result in the revocation of such approvals. There

are certain material approvals for which applications have been made to the relevant authorities. For details regarding statutory approvals required or obtained, please refer to page 165 of the Draft Letter of Offer.

18. Cement production requires us to adhere to the stringent Environment Laws and laws relating to pollution control and if there any non compliances, it would lead to temporary stoppages in production and also have an adverse impact on production, our revenues and profitability. Further, additional or new compliances may also require us to invest in new equipment or make additional investments, which could adversely affect our profitability.

Our cement operations are subject to various Indian national and State environmental laws and regulations relating to the control of pollution in the various locations in India where we operate. In particular, the discharge or emission of chemicals, dust or other pollutants into the air, soil or water that exceed permitted levels and cause damage to others may give rise to liabilities to the Central Government and State Governments and third parties, and may result in our incurring costs to remedy such discharge or emissions, such as from the use of coal. There can be no assurance that compliance with such environmental laws and regulations will not result in a curtailment of production or a material increase in the costs of production or otherwise have a material adverse effect on our financial condition and results of operations. Environmental laws and regulations in India have been increasing in stringency and it is possible that they will become significantly more stringent in the future. Stricter laws and regulations, or stricter interpretation of the existing laws and regulations, may impose new liabilities on us or result in the need for additional investment in pollution control equipment, either of which could affect our business, financial condition or prospects.

19. Mishaps or accidents at our manufacturing facilities could result in a loss or shutdown of operations and could also cause damage to life and property thereby leading to our operations and profitability being affected adversely.

Our Company’s facilities are subject to operating risks, such as breakdown or failure of equipment, power supply interruptions, facility obsolescence or disrepair, natural disasters and industrial accidents. Various production hazards such as explosions, discharge of hazardous substances, storage tank leaks could also result in personal injury and property damage. The occurrence of any of these risks could also affect the Company’s operations by causing production at our facilities to shut down or slow down. Although we take reasonable precautions to minimize the risk of any significant operational problems at our facilities, no assurance can be given that one or more of the factors mentioned above will not occur, which could have a material adverse effect on our results of operations and financial condition.

20. We do not own the land on which our manufacturing plant is constructed or the mine that is the source of limestone to our Plant.

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The land at Banswara, Rajasthan, on which we have constructed the 1.5 MT Plant is only partly owned by us and the rest is leased on a long term basis for 99 years. Further, the limestone mine awarded to us in 1996 is valid for a period of 20 years initially, and is renewable for further periods of upto 20 years each time upon expiry of lease. Any inability on our part to renew this lease for a further period may require us to consider alternate sources of limestone and other raw materials, which may be more expensive than the limestone currently being excavated from the leased Mine. Further, it cannot be guaranteed that such event would not temporarily disrupt the operations of our Plant adversely.

21. Any disruptions in transport and supply could impact the operations of our Company.

The production of cement is dependent on a steady supply of various inputs. These inputs are transported to our plants by land and sea transport, and cement is transported to our customers by land. Transport of our inputs and finished products is subject to various bottlenecks and other hazards beyond our control, including poor road and other transport infrastructure, accidents, adverse weather conditions, strikes and civil unrest. Either an increase in the price of transportation or interruptions in transportation of our inputs or finished products could have an adverse effect on our business, financial condition and results of operations. In addition, cement is a perishable product as its quality deteriorates upon contact with moisture or humidity over a period of time. Therefore, prolonged storage or exposure to moisture during transport may result in cement stocks being written off. Similarly, our cement is sold in bags, which may split open during transport, again resulting in stock being written off. We do not maintain business interruption insurance with respect to transport. No assurance can be given that any such disruption will not occur in the future as a result of these factors and that such disruptions will not be material.

22. The future results of operations our Company could be adversely affected by strikes, work stoppages or increased wage demands by our employees.

As of January 31, 2011, our Company had 206 full-time employees, located at the Plant and at various marketing offices. Most workers are represented by labour unions. While we consider our relations with our employees to be good, there is no assurance that we will not experience future disruptions to our operations due to problems with our workforce, which can adversely affect the business and financial condition of our Company.

23. Our Company’s growth depends on its ability to attract and retain skilled Personnel. Failure of the Company to attract and retain skilled personnel could adversely affect our Company’s growth prospects.

Our Company’s ability to meet future business issues depends on its ability to attract and recruit talented and skilled personnel. While we strive to take steps to arrest attrition, if any, it cannot be guaranteed that our key personnel would continue to be under our employment for a

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prolonged period of time. High attrition may be detrimental to our operations and financial performance.

24. Our Company’s primary business activity has contributed to less than 25% of the revenues in the last three fiscal years.

Our Company’s primary business activity is operating a 1.5 MT cement manufacturing plant in Banswara, Rajasthan. Commercial production of cement at the Plant commenced only in January 2011. Our Company’s revenues in the previous three financial years consisted primarily of revenues earned from trading activities of our Company and little or no revenue was earned from the cement manufacturing business during these years.

25. Our Company might not have sufficient insurance to cover losses that could be incurred in our operations.

The operations of our Company could result in destruction of property, plant and equipment, loss of life and injury, damage to the environment, and are subject to risks such as terrorism, fire, flood, theft. Our Company maintains safety measures to diminish such risks. However, such risks cannot be removed in entirety. We maintain insurance for standard fire and special perils policy, which provides insurance cover against loss or damage by fire, explosion, riot and strikes, terrorism, burglary, theft and robbery, which we believe is in accordance with customary industry practices.

However, the amount of our insurance coverage may be less than the replacement cost of all covered property and may not be sufficient to cover all financial losses that we may suffer should a risk materialize. Further, there are many events that could cause significant damages to our operations, or expose us to third-party liabilities, whether or not known to us, for which we may not be adequately insured. If we were to incur a significant liability for which we were not fully insured, it could have a material adverse effect on our results of operations and financial position.

For further details regarding the current insurance policies of our Company, please refer to “Insurance” in the section “Our Business” on page 51 of this Draft Letter of Offer.

26. Our Company’s future investments or acquisitions may not be successful or may be difficult to integrate.

Our Company, from time to time, might consider making strategic acquisitions, in similar or unrelated businesses. Mergers and acquisition of business are often subject to difficulties in integration, which may be human resource related or process related. We cannot assure that any such actions carried out in the future would generate intended synergies.

Further, it cannot be guaranteed that our Company would derive the financial benefit from such investment that would give the required returns to our Company.

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27. We operate in an industry which is highly fragmented and this fragmented set-up could lead to increased competition forcing us to reduce prices and thereby affecting our profitability.

The cement industry in India is highly fragmented and competitive. Some of our competitors are larger than we are, may have more diversified, may have operations across India, may have greater financial resources, may have access to a cheaper cost of capital and may be able to produce cement more efficiently or to invest larger amounts of capital into their businesses. Our business could be adversely affected if we are unable to compete with our competitors and sell cement at comparable prices. For example, if any of our current or future competitors develop more efficient production facilities, enabling them to produce cement and clinker at a significantly lower cost and sell at lower prices than us, we may be required to lower the prices we charge for our products and our business and results of operations could be adversely impacted. Current and future competitors may also introduce new and more competitive products and supporting services, make strategic acquisitions or establish cooperative relationships among themselves or with third parties, including distributors of our products, thereby increasing their ability to address the needs of our target customers. If we cannot compete in pricing, provide competitive products or services or expand into new markets, this could have a material negative effect on our business, financial condition and prospects.

28. There are legal proceedings against Promoter Group Companies.

There are various legal proceedings pending at different levels of adjudication against our Promoter Group Companies. The Company is not a party to the proceedings against the Promoter Group Companies. However, no assurances can be made that if any of these proceedings are negatively determined against the Promoter Group entities, the future results of operations of the Company will not be significantly affected.

For further details please refer to the section titled “Outstanding Litigation and Material Developments” on page 155 of the Draft Letter of Offer.

29. Some of the Promoter Group Companies have incurred losses historically.

Some of our promoter group / group companies have incurred losses in the last three financial years, the details of which are as under:

Sl. Name of the Company FY 2010 FY 2009 FY 2008 No. (In Rs. lakhs) 1 Industrial Chemicals & Monomers Limited (16.72) (19.49) (45.48) 2 Raasi Cement Limited (0.69) (18.11) (2.59) 3 Coromandel Travels Limited (1085.47) (850.97) - 4 ICL Financial Services Limited (176.78) 340.49 111.68 5 ICL Securities Limited (95.79) 199.40 107.54 6 ICL International Limited (384.13) (887.13) 100.70 7 Coromandel Sugars Limited 1658.44 80.45 (323.44)

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8 Unique Receivable Management Private Limited (290.09) (2,627.58) (2,606.43) 9 India Cements Capital Limited 327.53 (109.11) 172.87 10 ICL Shipping Limited 40.70 1.25 (11.52)

30. Inadequacy of profits may result in non-redemption of OCRPS or NCDs

Through this Issue, an amount of Rs. 179.02 Cr. is proposed to be raised through the issue of OCRPS to our shareholders. As per the terms of the Issue, the Company, at its discretion, may redeem the OCRPS against the issuance of NCDs against the redemption price of the OCRPS at the end of any of 3 years, 4 years, 5 years, 6 years or 7 years from the date of allotment of allotment of the OCRPS. OCRPS which are not converted at the end of 8 years of allotment, shall automatically be redeemed. The NCDs shall have a term of 5 years since conversion, upon which they shall be redeemed through payment of cash.

It cannot be guaranteed that our Company would generate adequate profits through this period and would have available resources to redeem the OCRPS or NCDs at their respective redemption dates. As per Companies Act, 1956, preference shares can be redeemed only out of the distributable profits of the Company or out of fresh issue of shares. The ability of the Company to redeem the OCRPS issued through this Draft Letter of Offer is therefore subject to the Company’s ability to generate distributable profits till the end of the tenor of OCRPS or raise fresh capital.

31. Our Company has not been regular in making various filings with the Stock Exchanges

ICLFSL acquired control of our company in the financial year 2009-10. Prior to this change in management, our Company was not regular in various filings as required under the Listing Agreement. There was also a delay in making payment pertaining to annual listing fee payable to the stock exchanges. Further, our Company has not been paying the annual listing fee for ASE, MPSE and DSE. The Company, however, has been making periodic reporting with the stock exchanges as per the requirement of the Takeover Code and Listing Agreement of late.

32. Equity Shares of our Company are currently suspended from trading at certain stock exchanges.

Due to non-compliance with various terms of the Listing Agreement our Equity Shares were suspended from trading at BSE, MPSE, ASE and DSE. While BSE, one of the two stock exchanges with nationwide terminals, has permitted commencement of trading of our Equity Shares on November 04, 2010, our Equity Shares continue to remain under suspension in ASE, DSE and MPSE. Given the low trading volume in general at these stock exchanges, we propose to delist our Equity Shares from them, subject to necessary approvals being received from our Board. In this regard, we expect to seek necessary approvals after the completion of the Issue.

33. Post Issue, the price of the Equity Shares may fluctuate or an active trading market for the Equity Shares may not develop.

Post issue, the price of the Equity Shares and OCRPS of our Company may be volatile. Fluctuations in global and Indian securities markets, performance of cement industry, performance of our Company, financial analysts’ recommendations, perception of the Indian cement sector, changes in economic and regulatory policies can impact the volatility of the price of the Equity Shares of our Company. An active trading market for the Equity Shares may not develop post issue. The price at which the Equity Shares are initially traded may not correspond to the prices at which the Equity Shares will trade post Issue.

34. If our Company makes any future further issuance of Equity Shares, the trading price of the Equity Shares may be adversely affected.

If our Company issues Equity Shares or convertible securities in the future, the trading price of its Equity Shares may be negatively affected. These future issuances might dilute earnings per share in the short term, and impact adversely the market price of the Equity Shares.

External Risk Factors

35. Indian economy slowdown with slowdown in Western India could negatively impact the business of the Company.

Our production facilities are located in the state of Rajasthan in western India and the target markets for the cement produced by our Company is Rajasthan, Gujarat and Madhya Pradesh. The cement industry is largely regional, given the high transportation costs involved. If there is a slowdown in the economy of Western India, there could be a significant effect on our Company’s future results of operations.

36. The cement industry in India is cyclical in nature.

The cement industry in India is cyclical in nature. Supply and demand of cement is influenced by economic conditions, overcapacity and production levels. Key sectors such as housing impacts the industry cyclicality as well.

37. The cement business is seasonal, and affected by factors beyond the control of our Company.

The monsoons hamper construction activities and very often, site activites are suspended until after the rainy season. As a result, sales of cement during the monsoon reduces significantly. During this period, however, manufacturers continue to incur operational and functional costs.

38. Taxes and other levies imposed by the Central Government or State Governments may have a material adverse effect on the future results of operations of our Company.

The Central or State Governments may impose taxes and other levies such as Custom duties, Excise duty and Central and State sales tax / value added tax. An increase in taxes or levies, or

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the occurrence of new taxes or levies in future, may have a negative effect on the future financial condition of our Company.

39. The cement industry in India is subject to environmental and other regulations.

The cement industry in India is subject to environmental laws and pollution control regulations. While our Company is in compliance with these environmental laws and regulations, there is the possibility that the laws might become stricter in future. This might impact the business of our Company.

40. The cement industry relies upon Government Infrastructure Policy.

The cement industry is dependent on the activities of the infrastructure sector. India’s infrastructure sector is reliant on budgetary allocations of the Central and State Governments. Any adverse policies by the Government in this sector could impact the future results of operations of our Company.

41. Force Majeure events such as terrorist attacks, war, natural disaster or other catastrophic events may disrupt or otherwise adversely affect the markets, result in loss of customer’s confidence, and adversely affect our business, financial condition and results of operations.

Our business may be adversely affected by, terrorist attacks, war, natural disaster or other catastrophe. A catastrophic event could have a direct negative impact on us or an indirect impact on us, for example, affecting our customers, the financial markets or the overall economy. In recent times, terrorist attacks in India have become more prevalent. Such attacks may have a material adverse effect on the Indian and global financial markets. Any deterioration in relationship of India with its neighbouring countries may result in actual or perceived regional instability. Events of this nature in the future could have a material adverse effect on our ability to develop our operations. As a result, our business, prospects, results of operations and financial condition could be materially and adversely affected by any such events.

42. Political instability or changes in the Government could adversely affect economic conditions in India generally and our business in particular.

Our Company’s future results of operations are reliant on the stability of the political situation and policies in the country. Any political instability could have a material adverse effect on our Company’s performance and the performance on the securities market for the Company’s shares. Changes in laws and policies could impact our Company’s business adversely.

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Prominent Notes: i) Investors may contact the Lead Manager or the Compliance Officer of the Company for any complaint/clarification/information pertaining to the Issue. For contact details of the Lead Manager and the Compliance Officer, please refer to “General Information” beginning on page 13 of this Draft Letter of Offer. ii) Simultaneous, but Unlinked Issue of 4,92,31,600 Equity Shares of Rs. 10/- each at a price of Rs. 22.50/- (including share premium of Rs.12.50) per fully paid Equity Share aggregating Rs. 110.77 crore in the ratio of 11 Equity Shares for every Equity Share held by the existing shareholders on the record date, i.e. *●+ and issue of 1,79,02,400 OCRPS of Rs.100/- each at a price of Rs. 100/-, aggregating Rs. 179.02 crore on rights basis to the existing shareholders of our Company in the ratio of 4 OCRPS for every Equity Share held by the existing shareholders on the Record Date, that is on *●+. The total proceeds from the Issue would aggregate to Rs. 289.79 crore. iii) As on September 30, 2010, the Net Worth of the Company was Rs. 757.00 Lakhs. iv) The book value per Equity Share of Rs. 10 each as on September 30, 2010 is Rs. 16.82 per Equity Share. v) The name of our Company was changed from ‘Indo Zinc Limited’ to ‘Trinetra Cement Limited’ in order to reflect the nature of business of the Company and consequently, a fresh certificate of incorporation was issued by the Deputy Registrar of Companies, Maharashtra on March 18, 2011. vi) For details of the Group Companies having business interest or other interests in the Company, please refer to ‘Related Party Transactions’ in the section “Financial Statements” on page 95 of this Draft Letter of Offer. Our Company has entered into a Marketing Agreement with India Cements for using their brand and dealer network for its distribution of the cement manufactured by it. For further details of the Marketing Agreement, please refer to “History and other corporate information” on page 70 of the Draft Letter of Offer. vii) Except as shown under “Capital Structure” beginning on Page 21 of this Draft Letter of Offer, our Promoter and Promoter Group entities have not purchased or sold, directly or indirectly, any Equity Shares during a period of six months preceding the date of this Draft Letter of Offer. viii) There are no financing arrangements whereby the Promoter Group, the Directors of our Company and their relatives have financed the purchase by any other person of securities of our Company during the period of six months immediately preceding the date of filing this Draft Letter of Offer with SEBI. ix) Save and as disclosed in the section titled “Objects of the Issue” beginning on page 30 of this Draft Letter of Offer, no part of proceeds of the Issue will be paid as consideration to Promoters, Directors, Key Managerial Personnel or Group Companies.

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x) As on September 30, 2010, our Company had contingent liabilities (in the form of capital commitments) to the extent of Rs. 16071 Lakhs. xi) The Lead Manager and our Company shall make all information available to the investors at large and no selective or additional information would be available only to a section of the investors in any manner whatsoever. xii) Our Company and the Lead Manager are obliged to keep this Draft Letter of Offer updated and inform investors of any material developments until the listing and trading of the Securities offered under this Issue commences.

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SECTION III - INTRODUCTION SUMMARY

This is only a summary and does not contain all the information that you should consider before investing in our securities. You should read the entire Draft Letter of Offer, including the information contained in the sections titled ‘Risk Factors’ and ‘Financial Information’ beginning on page nos. x and 95 of this Draft Letter of Offer before deciding to invest in our Securities.

THE ISSUE

The following is the summary of the Issue. This summary should be read in conjunction with more detailed information in section titled “Terms of the Issue” on page 177 of this Draft Letter of Offer

Equity Shares proposed to be issued by our 4,92,31,600 Company Rights Entitlement 11:1 i.e. 11 Equity Shares for every 1 Equity Share held on Record Date Record Date *●+ Issue Price per Equity Share Rs. 22.50 Equity Shares outstanding prior to the Issue 44,75,600 Equity Shares outstanding after the Issue 5,37,07,200 Dividend Per Share As determined by the Company from time to time Terms of the Issue Please refer to section titled “Terms of the Issue” beginning on Page 177 of this Draft Letter of Offer Terms of Payment 100% on application* Use of Issue Proceeds Please refer to section titled “Objects of the Issue” on Page 30 of this Draft Letter of Offer.

OCRPS proposed to be issued by our 1,79,02,400 company Issue Price per OCRPS Rs. 100.00 Rights Entitlement 4:1 i.e. 4 OCRPSs for every 1 Equity Share held Record Date *●+ OCRPS outstanding prior to the Issue Nil OCRPS outstanding after the Issue. 1,79,02,400 Dividend 9% per annum Terms of the Issue Please refer to section titled “Terms of the Issue” beginning on Page 177 of this Draft Letter of Offer Terms of Payment 100% on application* Use of Issue Proceeds Please refer to section titled “Objects of the Issue” on Page 30 of this Draft Letter of Offer.

Note: The Company has 10,00,000 Non-Convertible Redeemable Preference Shares of Rs. 100 each outstanding as on date.

*Payment by India Cements/ICLFSL shall be deemed to have been made by way of reduction of the outstanding amount of unsecured loans from India Cements/ICLFSL to the Company.

INDUSTRY OVERVIEW For clarifications on industry data, please refer to the disclaimers provided at the beginning of the section, “Cement Industry” on page 45 of this Draft Letter of Offer.

Cement production in India commenced in 1914. Severe competition from imported cement, coupled with various governmental price and distribution controls, resulted in slow growth of the Indian cement industry in the earlier years. In the subsequent 65 years, only 27 MT of capacity was added. This situation was reversed in the 1980s when the industry was partially decontrolled. This resulted in substantial increase in capacity and production. Nearly 30 MT of capacity was added during the 11 years from 1980 to 1990, thereby adding more capacity during one decade than had been added during the previous seven decades. Encouraged by the creation of substantial new capacity and the lowering of prices, the Government freed the industry from price and distribution controls on March 1, 1989 and delicensed it on July 25, 1991, leading to a significant increase in cement production capacities. During the period from 1991 to June 2009, approximately 169.86 MT (installed) of fresh capacity was added. Save for recent years in which demand has exceeded supply, for the most part since the 1980s, cement capacity in India has steadily outpaced demand. India has grown to become the second largest cement producer in the world, after China, with installed capacity of approximately 229.17 MT in June 2009. India is also estimated to have approximately 90 billion tonnes of limestone reserves, the main raw material used in the manufacture of cement.

As of June 30, 2009, the Indian cement industry comprised over 45 cement producers, operating 152 large cement plants with an average installed capacity of 227.48 MT over the year. Over the years, the cement industry has made significant progress upgrading and assimilating the latest technology. Actual cement production in 2008-09 was 181.61 MT as against 168.31 MT in 2007-08, registering a growth rate of 7.9%. Cement demand during the same period was 177.99 MT, registering a 8.51% increase over the previous year. During the three months ended June 30, 2009, cement demand increased by over 11.51% as compared to demand in the three months ended June 30, 2008.

In 2007, global cement consumption was reported at 2.7 billion tonnes, with China accounting for nearly half of the total output. India was the second largest producer with approximately 6.2% of the total output, closely followed by the United States at approximately 3.7%. Global cement consumption has increased significantly during the period 1997-2007 with an average increasing rate of more than 5% per year. During the same time, the Indian cement industry recorded a CAGR in cement production of 8.2%, principally due to improved economic conditions and increased construction activity. Despite this comparatively high growth rate enjoyed by the Indian cement industry, India’s per capita cement consumption of 156 kgs per annum was amongst the lowest in the world, with other developing nations like Egypt, Thailand and Vietnam having per capita consumption of cement of more than 400 kgs per annum.

One of the defining features of the Indian cement industry is its highly clustered nature, as cement units are concentrated in close proximity to limestone deposits. As a result, cement units tend to be located close to both limestone deposits, as well as the markets those units service. This is one of the key factors which has resulted in the Indian market being more regional and fragmented in nature.

The following table sets forth the estimated market share of the largest Indian cement producers for December 2010:

Sl. No. Company/ Group Market Share as in December 2010

1 Grasim Industries Limited and Ultratech 18.01% Cement Company Limited 2 The Associated Cement Companies Limited 17.87% and Gujarat Ambuja Cements Limited 3 Jaypee Cements Limited 6.89% 4 The India Cements Limited 5.86% 5 Madras Cements Limited 4.70%

Source: Management information

For further information on the Cement manufacturing industry, please refer to the section titled ‘Cement Industry’ on page 45 of the Draft Letter of Offer.

BUSINESS OVERVIEW We are in the business of manufacturing and marketing of various types of cement. We have an operational cement plant with a capacity of 1.5 MTPA in Banswara, Rajasthan (“Plant”). We also have a long-term lease of 65.82 hectares of limestone mines (“Mine”). We are also in the process of constructing a 20 MW thermal power plant within the location of our Plant, which is expected to be operational by June, 2011.

Our Company was formed in 1987 and our primary objects include manufacture and trading of zinc, brass and other ferrous and non-ferrous metals. In 1988-89, we had set up a primary zinc plant in Pithampur, Madhya Pradesh. In 1993, we raised funds through an Initial Public Offering to partly fund the construction of an electrolytic copper refining facility at Pithampur, Madhya Pradesh. This project, however, was subsequently abandoned.

In 1995, Mahi Cement Limited, which was in the process of constructing a cement plant in Banswara, Rajasthan with a capacity of 0.5 MPTA, was amalgamated with our Company. However, our Company later faced financial difficulties and we had to suspend construction of this plant. In 1998, we were classified as a sick industrial company.

In 2009, our Promoter, ICLFSL acquired certain Equity Shares of our Company and subsequently entered into a share purchase agreement with our erstwhile promoters. As a result, an open offer was made to our public shareholders. All of these together resulted in ICLFSL acquiring majority stake and control of our Company. Simultaneously, the abandoned cement plant at Banswara was revived and plant capacity increased to 1.5 MTPA. The Plant has commenced commercial production in January 2011.

Our Company is part of the India Cements group. Our ultimate promoter, The India Cements Limited (“India Cements”), is the largest producer of cement in south India by volume. India Cements owns and operates seven integrated cement manufacturing plants, which are strategically located near its own limestone deposits and two standalone grinding units, in the states of Andhra Pradesh, Tamil Nadu and Maharashtra, and has a total installed capacity of approximately 14 MTPA.

Our Competitive Strengths

1. Experienced Management and Promoters

Our Ultimate promoter, The India Cements Limited, has been in the business of cement manufacturing and distribution for over 6 decades and is the largest producer of cement in South India by volume (Source: CMA). Our promoters bring with them their vast knowledge and experience, which shall help us achieve better operational efficiency. Our non-independentt directors have substantial experience of managing various functions of the cement business. Shri Karan Vashisht, the head of our Plant, brings with him significant experience in the operations of a cement manufacturing plant.

2. Proximity to raw material and principal markets:

As cement is a bulk commodity, transportation costs contribute significantly to the overall cost of sales, and proximity to markets is an important factor in our cost and profitability. Our Plant is located in Banswara, Rajasthan, which is in close proximity to our primary markets – Rajasthan, Madhya Pradesh and Gujarat.

Limestone, which is the principal raw material used in the manufacturing of cement, is procured from our Mine, which is in very close proximity to our Plant. Our Plant is located about 2 km away from the Banswara – Dungarpur highway. Most of the other raw materials used, like coal, fly ash and gypsum can be sourced from the vicinity by trucks, thus keeping logistical costs under control.

3. Ability to utilize India Cements’ marketing channels

We have recently commenced production of cement and do not have our own distribution network to market our products. However, our Company has entered into a Marketing Agreement with India Cements whereby our Company shall manufacture cement under the brand name ‘COROMANDEL” which is owned by India Cements. Our Company may also utilize the distribution capabilities of India Cements, who has an established dealer network, to market its products. This arrangement facilitates us to focus on improving the operational parameters of the Plant, without channelling our resources towards setting up a dealership network immediately.

Our Strategy

1. Achieve maximum capacity utilization of our Plant

We commenced trial production of our cement from our Plant in October 2010 and our monthly production for the month of November 2010, December 2010 and January 2011 has been 29,169 Ton, 44,219 Ton and 68,497 Ton respectively, or 23%, 35% and 55% of our full capacity. In the near future, we shall endeavour to increase the capacity utilization of the Plant to 90%. This may enable us to achieve higher returns for our shareholders.

2. Develop our own distribution network in our target markets We have recently commenced production of cement and do not have our own distribution network to market our products. We have entered into an agreement with India Cements to utilize one of their brands - ‘Coromandel’ and to utilize their distribution network in the key areas of operations. For the same, we currently pay India Cements Rs. 100 per tonne of cement sold. Over a period of time, we would try to develop our own dealer network to reduce this additional payment to India Cements.

3. Implement measures to reduce cost We shall try and minimize the cost of our operations through optimising various parameters and procurement of raw materials from suitable locations so that the purchase price and transportation cost, taken together is the lowest and cost of production is reduced. Further, to reduce production cost and dependence on external sources for electricity, we are also in the process of setting up a 20 MW captive thermal power plant within the Plant. Simultaneously, we shall also try to minimize wastage in our production process.

4. Secure further linkages to raw materials such as limestone

We are also considering acquiring additional leases for mining of limestone so that (i) cost of raw material is minimized further (ii) we ensure continuous supply of the required amount of raw material required by us for maximizing production without depending on market conditions.

5. Continue to explore opportunities to expand our capacity, either through establishing new plants or through mergers and acquisitions

We shall continue to explore opportunities to increase the installed capacity of cement manufacturing through greenfield or brownfield expansion and may even consider acquisition of other cement plants, if deemed approprite.

For further information on our business activities, please refer to the section titled ‘Our Business’ on page 51 of the Draft Letter of Offer.

SUMMARY STATEMENTS OF FINANCIAL INFORMATION The following tables set forth summary of financial information derived from our restated standalone financial statements as of and for the fiscal year ended March 31, 2010, March 31, 2009 , March 31, 2008, March 31, 2007 and March 31, 2006. Our restated financial statements have been prepared in accordance with Indian GAAP, the Companies Act and SEBI (ICDR) Regulations,2009 and are included in the section titled “Financial Statements” on page 95 of this Draft Letter of Offer. This table should be read in conjunction with the restated financial statements, the notes thereto and chapter titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on page 142 of this Draft Letter of Offer.

STATEMENT OF ASSETS AND LIABILITIES

(Rs. in Lakhs) As at Year Ended March 31, September Particulars 30 2006 2007 2008 2009 2010 2010 (1) Fixed Assets : Gross Block 1,104.07 1,104.07 987.90 383.92 409.42 408.08 Less : Depreciation 850.26 869.72 772.70 205.91 209.50 214.57 Net Block 253.80 234.35 215.20 178.00 199.92 193.51 Capital Work in Progress 2,186.05 2,186.05 1,972.46 8,521.19 60,621.21 71,037.41 Preoperative Expenses - Pending Capitalisation - - - 662.88 4,582.12 8,824.84 Less : Revaluation Reserve ------

Net Block after adjustment for revaluation reserve 2,439.85 2,420.40 2,187.66 9,362.07 65,403.25 80,055.76

(2) Investments 7.40 7.40 7.20 - - -

(3) Current Assets, Loans and Advances Inventories 279.97 314.59 101.44 9.87 - 897.37 Sundry Debtors 13.48 28.48 67.07 16.58 7.17 17.92 Cash and Bank Balances 247.75 271.97 16.92 66.89 1,952.49 577.66 Loans and Advances 688.59 142.43 102.03 725.49 2,092.97 2,968.35 Other Current assets ------Total 1,229.79 757.48 287.45 818.83 4,052.63 4,461.31

(4) Liabilities and Provisions Secured Loans 5,406.97 4,465.22 315.16 8,700.02 16,192.00 19,093.75 Unsecured Loans 25.30 554.48 328.19 - 48,997.63 58,884.93 Current Liabilities and provisions 416.66 371.19 528.56 517.33 3,245.26 5,781.40 Total 5,848.93 5,390.90 1,171.91 9,217.35 68,434.89 83,760.07

(5) Net Worth (2,171.89) (2,205.63) 1,310.40 963.55 1,020.99 757.00

(6) Represented by Share Capital 448.78 448.78 448.78 448.78 448.78 448.78 Reserves and Surplus (2,620.67) (2,654.41) 861.62 514.77 572.21 308.22 Less Revaluation Reserve ------Reserves and Surplus (Net of Revaluation reserves) (2,620.67) (2,654.41) 861.62 514.77 572.21 308.22 Net Worth (2,171.89) (2,205.63) 1,310.40 963.55 1,020.99 757.00

NOTES:

(1) Share capital consists of 4500,000 equity shares of Rs. 10 each, fully paid, net of calls unpaid of Rs. 1.22 Lacs. The share capital includes 250,000 equity shares allotted as fully paid bonus shares by capitalization of reserves and 384,000 equity shares allotted as fully paid shares to the shareholders of Mahi Cement Ltd, the amalgamating company for consideration other than cash.

(2) During the financial year 2008-09, the Company decided to revive the Cement project at Banswara in Rajasthan. Work has been going on for execution of the project since then. Pre-operative expenses incurred on this Cement project since the financial year 2008-09, pending capitalization, are shown in the Statement of Assets and Liabilities.

(3) Capital works in progress include capital advances including advances for purchase of land for new projects.

SUMMARY STATEMENT OF PROFITS AND LOSSES (Rs. in Lakhs) Half Year Year Ended March 31, Ended 30th Sep 2006 2007 2008 2009 2010 2010 Income Sales of products manufactured by the issuer - - - - - of products traded in by the issuer 51.73 205.88 282.35 75.11 6.73 671.05 Total 51.73 205.88 282.35 75.11 6.73 671.05 Other Income 65.73 2.84 21.73 27.37 88.87 4.85 Increase / (Decrease) in Inventories 81.90 34.62 (60.78) (66.13) (0.57) 61.53 199.36 243.34 243.30 36.35 95.03 737.43 EXPENDITURE : Cost of Traded goods 129.71 210.48 217.10 23.11 9.30 849.41 Staff Costs 20.09 18.71 18.80 9.90 1.84 3.89 Other Operating Expenses 10.93 10.90 38.27 66.67 4.01 - Administration Charges 11.38 12.27 8.90 12.57 4.77 19.90 Selling and Distribution Expenses - - - - - 117.82 Depreciation 18.59 16.00 13.63 11.72 7.37 3.31 Interest - - 15.58 - - 7.10 Material non-recurring items: Bad debts/ advances (see note no 4 below) - - 70.37 492.59 - - Loss in value of stock due to deterioration - - 141.91 - - - Expenses relating to abandoned project 7.56 8.21 10.68 - - - (see note no. 2 below) TOTAL EXPENDITURE 198.26 276.57 535.25 616.55 27.28 1,001.42 Net Profit before tax and extra ordinary items 1.10 (33.23) (291.94) (580.20) 67.75 (263.99) Income-tax for current year ------Income-tax for earlier year (for FY1994-95) 55.45 - - - 10.31 - Deferred tax (see note no. 4 in Notes to accounts of Annexure IV) ------Fringe benefit tax 0.68 0.51 0.29 3.80 - - Total Tax 56.13 0.51 0.29 3.80 10.31 - Net Profit before extra ordinary items (55.03) (33.74) (292.23) (584.00) 57.44 (263.99) Extra ordinary Items -Net - - 526.90 65.16 - - Net Profit after extra ordinary items (55.03) (33.74) 234.67 (518.85) 57.44 (263.99)

NOTES:

(1) The Company was engaged in the business of zinc manufacturing and was having a plant at Pithampur in MP. Manufacturing activity in this plant was stopped in the year 1998-99 and remained suspended thereafter. The sales income during the financial years 2005-06 to 2009-10 was mainly from trading in non ferrous metal and scrap. The plant and machinery of the Zinc plant at Pithampur were sold during the financial year 2008-09. The zinc business of

the Company is now discontinued. The losses for the years 2005-06 to 2009-10 primarily relate to this discontinued business.

(2) The Company had decided to set up a cement plant at Banswara in Rajasthan in the year 1994-1995. However, the Company could not achieve financial closures for the project. Later, in the year 1997-98, the Company decided to abandon the project. Expenses on abandoned project shown in the above statement during the financial years 2005- 06 to 2007-08 pertain to this project.

(3) During the financial year 2008-09, the Company decided to revive the above-mentioned Cement project and work has been going on for execution of the project since then. Pre-operative expenses incurred on this Cement project since the financial year 2008-09, pending capitalization, are shown in the Statement of Assets and Liabilities.

(4) Bad debts/ advances include amounts of bad debts and bad advances written off, provisions made therefor and discounts given and are net of amounts withdrawn from provisions.

(5) Extra ordinary income shown in the Profit & Loss A/c is on account of writing back of interest liability on settlement of dues of the financial institutions/ banks.

SUMMARY STATEMENT OF CASH FLOWS

(Rs. in Lakhs) Half Year Year ended March 31, Ended 2006 2007 2008 2009 2010 30.09.2010 Cash flow from operating activities: Net profit before tax and 1.10 (33.23) (291.95) (580.21) 67.75 (263.99) exceptional items Adjustments for non operating and non cash expenses: Depreciation 18.59 16.00 13.63 11.72 7.37 3.31 Interest paid - - 15.58 0.01 - 7.10 Bad & doubtful debts - - 8.01 - - - written off Bad & doubtful advances - - - 492.59 68.00 - written off Stock Deterioration - - 141.91 - - - Loss on disposal of CWIP - - - 2.26 - - Loss on sale of fixed assets - - - 0.98 - - Expenditure on abandoned 7.56 8.21 10.68 - - - project 27.25 (9.02) (102.14) (72.65) 143.12 (253.59) Adjustment for non operating income: Profit on sale of fixed asset - (1.78) - (81.52) (4.84) Provisions no more - - - (68.00) - required Interest received (60.95) (0.39) (0.12) (0.05) -

Operating profit before (33.70) (9.02) (104.31) (72.77) (6.45) (258.43) working capital changes

Adjustment for changes in working capital:- (Increase)/decrease in (70.66) (34.62) 71.25 91.57 9.87 (897.37) inventories (Increase)/decrease in 16.92 (15.00) (46.60) 50.49 9.41 (10.76) debtors (Increase)/ decrease in 92.15 546.15 40.41 (623.47) (128.04) (90.81) other receivables Increase/(Decrease) in trade payable and other liabilities 40.81 (45.78) 157.61 150.77 (14.11) (13.52) Cash generated from 45.52 441.73 118.36 (403.41) (129.32) (1,270.89) operation Less: Interet paid - (15.58) (0.01) - Less: Direct taxes paid (0.53) (0.19) (0.52) (0.28) (65.61) - Net cash from operating 44.99 441.54 102.26 (403.70) (194.92) (1,270.89) activities (A)

Cash flow from investing activities Interest received 60.95 - 0.39 0.12 0.05 Sale of investments - - 7.20 - Sales of fixed assets - 3.86 40.90 87.86 5.50 Sale of CWIP - - 0.05 - - Purchase of fixed assets (0.07) - - (17.04) (39.46) - Expenditure on cement (4.12) (4.76) 206.35 (7,705.86) (54,457.53) (12,891.39) project Net cash used in investing 56.77 (4.76) 210.60 (7,674.63) (54,409.08) (12,885.89) activities (B) Cash flow from financing activities: Term loan from banks - - - 16,192.00 2,901.74 Loan from The India - - 8,700.01 40,297.60 9,887.30 Cements Ltd Repayment of term loan (700.05) (208.50) (78.00) - - Refund of share - - (165.52) - - application money Working Capital finance (5.00) (241.69) (133.13) - - (7.10) Other unsecured (2.00) 529.18 (226.28) (328.19) - - loans/deposits Net cash from financing (7.00) (412.56) (567.91) 8,128.31 56,489.60 12,781.95 activities (C)

Net increase/(Decrease) in 94.75 24.22 (255.05) 49.98 1,885.60 (1,374.83) cash &cash equivalents (A+B+C) Cash and equivalents at 153.00 247.75 271.97 16.92 66.89 1,952.50 the beginning of the year Cash and equivalents at 247.75 271.97 16.92 66.89 1,952.49 577.66 the end of the year

GENERAL INFORMATION Dear Equity Shareholder(s),

Pursuant to the resolution passed at the meeting of Board of Directors of our Company held on November 12, 2010, special resolutions passed by our Shareholders through Postal Ballot, the results of which were declared on February 21, 2011 and resolution of Share Issue Committee dated March 30, 2011, it has been decided to make the following offer to the Equity Shareholders of our Company as on Record Date i.e. *●+:

Simultaneous but Unlinked Issue of 4,92,31,600 Equity Shares of Rs. 10 each at a price of Rs. 22.50 (including share premium of Rs.12.50) per fully paid Equity Share aggregating Rs. 110.77 crore in the ratio of 11 Equity Shares for every Equity Share held by the existing shareholders on the record date , i.e. *●+ and issue of 1,79,02,400 Optionally Convertible Redeemable Preference Shares of Rs.100/- each at a price of Rs. 100/-, aggregating Rs. 179.02 crore on rights basis to the existing shareholders of our Company in the ratio of 4 OCRPS for every Equity Share held by the existing shareholders on the Record Date, that is on *●+ (the “ISSUE”). The total proceeds from both the issue of Equity Shares and issue of OCRPS would aggregate to Rs. 289.79 crore.

THE ISSUE PRICE OF THE EQUITY SHARE IS 2.25 TIMES THE FACE VALUE OF THE EQUITY SHARES AND THE ISSUE PRICE OF THE OCRPS IS AT FACE VALUE.

Important

1. This offer is applicable only to those Equity Shareholders whose names appear as beneficial owners in respect of the Equity Shares held in the electronic form and on the Register of Members of our Company in respect of the Equity Shares held in physical form as on *●+ i.e. the Record Date fixed in consultation with the Designated Stock Exchange i.e., BSE.

2. Your attention is drawn to “Risk Factors” appearing on Page x of this Draft Letter of Offer.

3. Please ensure that you have received the Composite Application Form (‘CAF’) along with this Letter of Offer. In case the original CAF is not received, lost or misplaced by the shareholder, the Registrar will issue a duplicate CAF on the request of the shareholder who should furnish the registered folio number/DP ID number, Client ID number and his/her full name and address to the Registrar. Please note that those applicants who are making the application in the duplicate CAF should not utilize the original CAF for any purpose including renunciation, even if it is received/ found subsequently. In case the original and the duplicate CAFs are lodged for subscription, allotment will be made on the basis of the duplicate CAF and the original CAF will be ignored.

4. Please read this Letter of Offer and the instructions contained therein and in CAF carefully, before filling in the CAF. The instructions contained in the CAF are an integral part of this Letter

of Offer and must be carefully followed. Application is liable to be rejected for any non- compliance with the terms of the Letter of Offer or the CAF.

5. All enquiries in connection with this Letter of Offer or CAF should be addressed to the Registrar to the Issue i.e. Integrated Enterprises (India) Limited quoting the registered folio number/ Depository Participant (DP) Number and Client ID Number and the CAF numbers, as mentioned in the CAF.

6. The Issue will be kept open for a minimum period of 15 (Fifteen) days. If extended, with the approval of the Board, it will be kept open for a maximum period of 30 (Thirty) days.

7. The Lead Manager and our Company shall update this Draft Letter of Offer and keep the public informed of any material changes, till the listing and trading commences for Shares offered through this Issue.

ISSUER DETAILS

Name of the Company : Trinetra Cement Limited Registered Office : No. 8, 2nd Floor, Kamanwala Chambers Opp Bombay Stores, Sir P M Road, Fort Mumbai – 400 001 Tel: +91 22 3241 5199 / 6524 / 0422 Fax: +91 22 2262 6313 Email: [email protected] Corporate Office : ' Coromandel Towers ', 93, Santhome High Road, Karpagam Avenue, R A Puram Chennai – 600028 Tel: +91 44 2852 1526/2857 2100/2857 2400 Fax: +91 44 2851 7198 Registration Number : 11 - 42858 CIN No. L99999MH1987PLC042858 Contact person: : Shri S Sridharan, Company Secretary and Compliance Officer Address of the Registrar of : Everest, 100 Marine Drive Companies Mumbai – 400 002 Maharashtra, India The Equity Shares of our Company are listed on BSE, ASE, DSE and MPSE but are currently traded only on the BSE.

Board of Directors

Our Board of Directors as on the date of filing this Draft Letter of Offer with SEBI is as follows:

Name of Director Designation Nature of Directorship Date of Appointment Shri N Srinivasan Chairman Non Executive and Non Independent October 09, 2009 Shri T S Raghupathy Director Non Executive and Non Independent October 09, 2009 Shri PL Subramanian Director Non Executive and Non Independent October 09, 2009 Shri R Srinivasan Director Non Executive and Non Independent October 09, 2009 Shri V M Mohan Director Non Executive and Non Independent October 09, 2009 Dr. B S Adityan Director Non Executive and Independent March 25, 2010 Shri Arun Datta Director Non Executive and Independent March 25, 2010 Shri R K Das Director Non Executive and Independent March 25, 2010 Shri N R Krishnan Director Non Executive and Independent March 25, 2010 Shri A Sankarakrishnan Director Non Executive and Independent March 25, 2010 Shri L Sabaretnam Director Non Executive and Independent May 28, 2010 For a detailed profile of our Directors, please refer to the chapter titled ‘OUR MANAGEMENT’ beginning on page 75 of this Draft Letter of Offer.

Company Secretary and Compliance Officer

Shri S Sridharan Trinetra Cement Limited 'Coromandel Towers' 93, Santhome High Road Karpagam Avenue, R A Puram Chennai - 600028 Tel: +91 44 2857 2148 Fax: +91 44 2851 7198 Email: [email protected]

ISSUE MANAGEMENT TEAM

Lead Manager to the Issue

MAPE Advisory Group Private Limited SEBI Regn. No.: INM 000011294 # 7C, PM Towers, Greams Road, Chennai - 600006 Tel: +91 44 2829 5378 Fax: +91 44 2829 5377 Email: [email protected] Website: www.mapegroup.com Contact Person: Shri Pravin Rajendran

# SEBI registration of MAPE Advisory Group Private Limited has expired on March 26, 2011. The application for renewal of certificate of registration was submitted by MAPE Advisory Group Private Limited to SEBI on

December 12, 2010, as required under Regulation 9(1) of SEBI (Merchant Bankers) Regulations, 1992. The approval of SEBI in this regard is awaited.

Registrar to the Issue Integrated Enterprises (India) Limited SEBI Regn No.: INR 000000544 2nd Floor, "Kences Towers", No. 1, Ramakrishna Street North Usman Road, T.Nagar, Chennai – 600017 Tel: +91 44 2814 0801 /2 /3 Fax: +91 44 28142479 Email: [email protected] Website:www.iepindia.com Contact Person: Shri K.Suresh Babu

Investors can contact the Compliance Officer or the Registrar to the Issue in case of any pre- issue or post-issue related problems such as non-receipt of letters of allotment, credit of allotted securities in the respective beneficiary account or refund orders.

All grievances relating to the ASBA process may be addressed to the Registrar to the Issue, with a copy to the relevant SCSB, giving full details such as name, address of the applicant, number of Securities applied for, Bid Amount blocked, ASBA Account number and the Designated Branch of the SCSBs where the ASBA Form was submitted by the ASBA Bidders.

Statutory Auditor to our Company

Chaturvedi S K & Fellows Chartered Accountants Firm Registration No. 112627W F-2, Vaishali, 1st Floor, V Mehta Marg, JVPD, Juhu, Mumbai - 400 049 Tel: +91 22 6741 9960 Fax: +91 22 6741 9960 Email: [email protected]

Auditor to the Issue

DPH & Co. Chartered Accountants Firm Registration No.: 128862W 12, Ground Floor, Pearl Mansion M K Road, New Marine Lines Mumbai 400 020 Tel. No. +91 22 2201 9191 Fax No. +91 22 2207 9494 Email: [email protected]

Legal Advisors to the Issue

HSB Partners 554/555, Capitale, 9th Floor Anna Salai, Teynampet Chennai 600 018 Tel: +91 44 2435 5217 Fax: +91 44 2435 5257 Email: [email protected] Contact Person: Mr. T.K.Bhaskar

Bankers/Lenders to our Company

Infrastructure Development Finance Axis Bank Limited Company Limited Ground Floor ITC Centre Karumuttu Nilayam 760, Anna Salai No. 192, Anna Salai Chennai – 600 002 Chennai – 600 002 Tel: (91 44) 2855 9440 Tel: (91 44) 6450 1623 Fax: (91 44) 2854 7597 Fax: (91 44) 28544193 E-mail: [email protected] E-mail: [email protected] Website: www.idfc.com Website: www.axisbank.com Contact Person: Mohan Contact Person: B Sathish Kumar

Yes Bank Limited UCO Bank 143/1, Nungambakkam High Road 212, Mount Road Chennai – 600 034 Chennai – 600 006 Tel: (91 44) 2831 9000 Tel: (91 44) 2829 7945 Fax: (91 44) 2831 9001 Fax: (91 44) 2829 7944 E-mail: [email protected] E-mail: [email protected] Website: www.yesbank.in Website: www.ucobank.com Contact Person: Shikha Khurana Contact Person: R K Sharma

Bankers to the Issue

(This section is intentionally left blank and shall be updated later)

SELF CERTIFIED SYNDICATE BANK

The list of SCSBs registered with SEBI is available on the website of SEBI at http://www.sebi.gov.in/pmd/scsb.html. For details on designated branches of SCSBs collecting the ASBA Bid cum Application Form, please refer the SEBI Website, www.sebi.gov.in.

Monitoring Agency

As per Regulation 16(1) of the SEBI (ICDR) Regulations, 2009, the requirement of a monitoring agency is not mandatory if the Issue size is below Rs. 50,000 lacs. Since the Issue size is less than Rs. 50,000 lacs, our Company has not appointed any monitory agency for this Issue.

However, as per Clause 49 of the Listing Agreement entered into with the Stock Exchanges upon listing of these shares and the Corporate Governance Requirements, the Audit Committee of our company would be monitoring the utilisation of the proceeds of the Issue.

Statement of allocation of responsibility

MAPE Advisory Group Private Limited is the sole Lead Manager to this Issue and shall be responsible for and shall coordinate all activities

Sl. No. Activity 1 Structuring of the Issue in conformity with the SEBI (ICDR) Regulations, undertaking liaison with the Stock Exchanges, as may be required under the prevailing framework of regulations/rules /guidelines issued by the SEBI and the Stock Exchanges. 2 Assisting the Company and its legal advisor in drafting this Letter of Offer, the Abridged Letter of Offer and the CAF; conduct due diligence as may be required on the Company and assist in compliance with regulatory requirements of the SEBI and the Stock Exchanges. The Lead Manager shall ensure compliance with the SEBI (ICDR) Regulations and other stipulated requirements and completion of prescribed formalities with the Stock Exchanges and the SEBI. 3 Assist in the selection of various agencies connected with the Issue, including printers, advertising agencies, legal advisor, bankers to the Issue (selecting collection centers) and Registrar to the Issue. 4 Assisting the Company in preparing the Issue advertisements. 5 Follow-up with the Bankers to the Issue to get quick estimates of collection and advising such banks about closure of the Issue, based on the correct figures. 6 Assisting in the listing of the Equity Shares issued pursuant to the Issue on the BSE. 7 The post-Issue activities will involve essential follow-up steps, which include finalization of basis of allotment or weeding out of multiple applications, listing of instruments and dispatch of certificates and refunds, with the various agencies connected with the work such as the Registrar to the Issue, the Bankers to the Issue, and the bank handling refund business.

Credit Rating Details

This being an Issue of Equity Shares and OCRPS on rights basis, no credit rating is required. In case the Company opts to redeem all or part of the OCRPS by way of issue of NCDs against the redemption of the OCRPS, at a later date in accordance with the terms of the Issue, it shall appoint a credit rating agency before doing so.

Issue Grading

As this is a Rights Issue of Equity Shares and OCRPS, grading of the Issue is not mandatory.

Debenture Trustees

Since this is not an issue of debentures, appointment of Debenture Trustee is not required. In case the Company opts to redeem all or part of the OCRPS by way of issue of NCDs against the redemption of the OCRPS, at a later date in accordance with the terms of the Issue, it shall appoint a debenture trustee before doing so.

Appraising Entity

The requirement of funds has not been appraised by any Bank or Financial Institution.

Underwriting/ Standby Arrangements

The present Issue is not underwritten and our Company has not made any standby arrangements for the present Rights Issue. ICLFSL, our promoter, and India Cements, our ultimate Promoter, have confirmed that they would subscribe to their respective entitlements in this Rights Issue (as applicable) in full. Further, our Promoters have also confirmed that they would also subscribe to the unsubscribed portion of this issue, if any, to the extent of 100% of, individually, both the Equity Shares and the OCRPS being issued pursuant to the Issue.

Minimum Subscription

If our Company does not receive minimum subscription of 90% of the Issue (separately for Equity Shares and OCRPS) or the subscription level falls below 90% after the Issue Closing Date, on account of cheques being returned unpaid or withdrawal of applications our Company shall forthwith refund the entire subscription amount received in respect of the Equity Shares or OCRPS, as the case may be, within 15 days from the Issue Closing Date. If there is a delay in the refund of subscription by more than eight days after the Company becomes liable to pay the subscription amount (i.e. 15 days after closure of the Issue), the Company will pay interest at the rate of 15% per annum for the delayed period.

Subscription to the Issue by the Promoter and Promoter Group

India Cements and ICLFSL, vide joint undertaking dated March 29, 2011, have undertaken to:

(a) apply for the Securities being offered pursuant to the Issue to the extent of their respective Rights Entitlement (as applicable); (b) apply for any Securities renounced in favour of either of them by others; and (c) apply for any additional Securities in the Issue, subject to applicable law, to ensure that 100% of the Issue is subscribed, individually for Equity Shares and OCRPS.

Such subscription for Equity Shares and/or OCRPS over and above their rights entitlement, if allotted, may result in an increase in their percentage of shareholding above their current percentage of shareholding. Further, such acquisition by them of additional Equity Shares and/or OCRPS shall (i) not result in a change of control of the management of our Company; and (ii) be exempt from the applicability of Regulations 10, 11 and 12 of the Takeover Code in terms of the proviso to Regulation 3(1)(b)(ii) of the Takeover Code.

In connection with OCRPS, the Promoters and the members of the Promoter Group shall apply for their entitlement and will be the owners of such number of Equity Shares, from the exercise of the conversion option on the OCRPS allotted to them and such exercise shall (i) not result in a change of control of the management of our Company; and (ii) be exempt from the applicability of Regulations 10, 11 and 12 of the Takeover Code in terms of the proviso to Regulation 3(1)(b)(ii) of the Takeover Code.

CAPITAL STRUCTURE Particulars Nominal Value Aggregate (Rs.) Value (Rs.) A. AUTHORISED CAPITAL 15,00,00,000 Equity Shares of Rs. 10 each 150,00,00,000 2,00,00,000 Preference Shares of Rs. 100 each 200,00,00,000

B. ISSUED AND SUBSCRIBED CAPITAL 45,00,000 Equity shares of Rs. 10 each 4,50,00,000 10,00,000 NCRPS of Rs. 100 each 10,00,00,000

C. PAID-UP CAPITAL 44,75,600 Equity shares of Rs. 10 each 4,48,78,000* 10,00,000 NCRPS of Rs. 100 each 10,00,00,000

D. PRESENT ISSUE BEING OFFERED TO THE EXISTING EQUITY SHAREHOLDERS THROUGH THIS LETTER OF OFFER 4,92,31,600 Equity Shares of Rs.10 each, at a premium of 49,23,16,000 110,77,11,000 Rs. 12.50 per Equity Share for cash fully paid-up 1,79,02,400 OCRPS of Rs.100 each, fully paid up, at par 179,02,40,000 179,02,40,000

E. PAID-UP CAPITAL AFTER THE ISSUE 5,37,07,200 Equity Shares of Rs. 10 each fully paid-up 53,71,94,000* 10,00,000 Non Convertible Redeemable Preference 10,00,00,000 Shares of Rs. 100 each, fully paid 1,79,02,400 Optionally Convertible Redeemable 179,02,40,000 Preference Shares of Rs.100 each, fully paid

F. PAID-UP CAPITAL ASSUMING CONVERISON OF ALL OCRPS INTO EQUITY SHARES 12,53,16,800 Equity Shares of Rs. 10 each fully paid-up 125,32,90,000* 10,00,000 Non Convertible Redeemable Preference 10,00,00,000 Shares of Rs. 100 each, fully paid Optionally Convertible Redeemable Preference Shares of - Rs.100 each, fully paid

G. SHARE PREMIUM ACCOUNT Existing Share Premium Account 4,65,57,000 Share Premium Account after the Issue assuming 66,19,52,000 allotment of all Equity Shares offered Share Premium Account after the Issue assuming conversion 1,79,02,400 OCRPS allotted pursuant to the 173,60,96,000 Issue *Includes Rs. 1,22,000 paid on 24,400 equity shares forfeited on February 10, 2011.

Notes to the Capital Structure:

1. Forfeiture of equity shares

24,400 equity shares of the Company were partly paid-up and an amount of Rs. 12.50 per equity share (Rs. 5 towards share capital and Rs. 7.50 towards share premium), amounting to Rs.3,05,000, was outstanding since 1993, despite multiple calls being made to the concerned equity shareholder. The Board of Directors of the Company, in its meeting held on February 10, 2011, resolved to forfeit 24,400 equity shares for non-payment of allotment money together with interest within the due date mentioned in the final notice of forfeiture dated January 07, 2011. The forfeiture of the aforesaid equity shares is effective from February 10, 2011.

2. Details of increase in Authorised Share Capital

(in Rs.) From To Total Preference Total Period Equity Share Authorized Equity Share Preference Share Authorized Capital Share Capital Share Capital Capital Share Capital Capital 1987 - - - 2,500,000 - 2,500,000 1988-89 2,500,000 - 2,500,000 7,500,000 - 7,500,000 1991-92 7,500,000 - 7,500,000 50,000,000 - 50,000,000 1994-95 50,000,000 - 50,000,000 250,000,000 - 250,000,000 1995-96 250,000,000 - 250,000,000 250,000,000 100,000,000 350,000,000 2010-11 250,000,000 100,000,000 350,000,000 1,500,000,000 2,000,000,000 3,500,000,000

3. Build-up of Equity Share Capital:

Our existing Equity Share Capital has been subscribed and allotted as under:

Date of No. of Face Issue Consideration Nature of Allotment Cumulative Allotment Equity Value Price Share Capital Shares (Rs.) (Rs.) (Rs.) 20/03/1987 30 100 100 Cash Signatories to the 3,000 Memorandum 14/10/1988 18,750 100 100 Cash Further allotment 18,78,000 14/11/1988 44,100 100 100 Cash Further allotment 62,88,000 30/05/1989 12,120 100 100 Cash Further allotment 75,00,000 1991-92 Sub-division of equity shares of Rs.100 each to Rs.10 each 75,00,000 25/11/1992 2,50,000 10 NA Other than Issue of Bonus Shares 100,00,000 Cash in ratio of 1 Equity Share for every 3 Equity Shares held 12/06/1993 31,16,000 10 15 Cash Public Issue/IPO 411,60,000 10/10/1995 3,84,000 10 NA Other than Shareholders of Mahi 450,00,000

Cash Cement Limited post amalgamation(2) 10/02/2011 (24,400) 10 NA - Forfeiture of Shares 4,48,78,000(3) Note: (1) On November 25, 1992, our Company has issued 2,50,000 Equity Shares in a bonus issue, in the ratio of 1 Equity Share for every 3 Equity Shares held to the shareholders by way of capitalization of its free reserves. (2) Pursuant to terms of the Scheme of Amalgamation, approved by the Hon’ble High Court, Mumbai vide order dated September 07, 1995, 3,84,000 Equity Shares of Rs. 10 each were allotted to the shareholders of Mahi Cement Limited, upon amalgamation with our Company. (3) Our Company has forfeited 24,400 partly paid-up equity shares with effect from February 10, 2011. The paid-up capital includes Rs. 1,22,000 paid on the aforementioned share.

4. Build-up of Preference Share Capital:

Date of No. of Face Issue Considera Nature of Allotment Cumulative Allotment Preferenc Value Price tion Preference e Shares (Rs.) (Rs.) Share Capital (Rs.) 14.03.2011 10,00,000 100 100 Cash Preferential Allotment 10,00,00,000 to India Cements

5. Equity Shares allotted for consideration other than cash:

Except as stated above and reiterated in the below mentioned table, our Company has not issued any Equity Shares for consideration other than cash:

Persons to Number of Face Date of Benefits accrued whom Equity Value Nature of Allotment Allotment to our Company Allotted Shares (Rs.) Bonus in the ratio of Existing 25.11.1992 2,50,000 10 one share for every 3 Nil Shareholders shares held Shareholders Allotted to shareholders All assets and of erstwhile of Mahi Cement Limited liabilities of 10.10.1995 3,84,000 10 Mahi Cement upon amalgamation Mahi Cement Limited with our Company Limited

6. Our Company has allotted 3,84,000 Equity Shares to the shareholders of the erstwhile Mahi Cement Limited pursuant to a scheme of amalgamation approved by the Hon’ble High Court of Mumbai under Section 391-394 of the Companies Act. For further details of the Scheme of Amalgamation, please refer to ‘Scheme of Amalgamation – Mahi Cement Limited’ in the section ‘History and other corporate information’ on page 70 of this Draft Letter of Offer.

7. Our Company does not have any Employee Stock Option Scheme /Employee Stock Purchase Plan for our employees and we do not intend to allot any Equity Shares to our employees under Employee Stock Option Scheme / Employee Stock Purchase Plan from the proposed Issue. As and when options are granted to our employees under the Employee Stock Option Scheme, our Company shall comply with the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999.

8. Our Company has not issued any Equity Shares or Preference Shares at a price which is lower than the issue price of the Securities offered pursuant to the Issue in the last one year.

9. Our Company has not revalued its assets since inception.

10. We presently do not have any intention or proposal to alter our capital structure for a period of 6 (six) months from the Issue Opening Date, by way of split/consolidation of the denomination of Equity Shares or further issue of Equity Shares (including issue of securities convertible / exchangeable, directly or indirectly for Equity Shares) whether on preferential basis or otherwise. However, if we go in for acquisitions and joint ventures, our Company might consider raising additional capital to fund such activity or use shares as currency for acquisition and/or participation in such joint venture.

11. Build up of Equity Share Capital in our Company by our Promoter - ICL Financial Services Limited

Sl. Date of Nature Face Issue/ Number Cumulative Percentage No. allotment / Value Acquisition of Equity Number of on total transfer (Rs.) Price Shares Equity current fully Shares paid up Equity Shares 1 13.07.2009 Purchase 10 22.50 5,83,600 5,83,600 13.04% 2 13.01.2010 Purchase pursuant 10 22.50 17,87,700 23,71,300 52.98% to a Share Purchase Agreement 3 13.01.2010 Purchase through 10 22.50 3,68,974 27,40,274 61.23% Open Offer 4 21.09.2010 Sale 10 22.50 (400) 27,39,874 61.22% Neither the entities forming the Promoter Group, nor the Directors of ICLFSL hold any Equity Shares of our Company as on the date of this Draft Letter of Offer.

12. None of our Promoter, Promoter Group entities, our Directors, Directors of ICLFSL or immediate relatives have purchased or sold any Equity Shares of our Company in last six months. However, ICLFSL has sold 400 Equity Shares at a price of Rs. 22.50 per Equity Share, on September 21, 2010, to entities unrelated to it.

13. The Pre and Post Issue Equity Shareholding Pattern of our Company is as under:

Pre-Issue Post-Issue

Category of Shareholders No. of Equity % of Pre-Issue No. of Equity % of Post Issue Shares Equity Capital Shares Equity capital (A) Promoters ICL Financial Services Limited 27,39,874 60.89% 3,28,78,488 60.89% Promoter Group - - - - Total Promoter and Promoter 27,39,874 60.89% 3,28,78,488 60.89% Group Shareholding (B) Public Shareholding (1) Institutions Mutual Funds/ UTI 99,000 2.20% 11,88,000 2.20% Financial Institutions/ Banks 400 0.01% 4,800 0.01% Foreign Institutional Investors Sub Total (B) (1) 99,400 2.21% 11,92,800 2.21% (2) Non Institutions Bodies Corporate 2,49,100 5.54% 29,89,200 5.54% Individuals Individual shareholders holding nominal share capital up to Rs. 1 9,69,880 21.55% 1,16,38,560 21.55% lac Individual shareholders holding nominal share capital in excess of 4,17,546 9.28% 50,10,552 9.28% Rs. 1 lac Any Others Hindu Undivided Families 2400 0.05% 28800 0.05% Clearing Members 1700 0.04% 20400 0.04% Non Resident Indians 20100 0.44% 2,41,200 0.44% Sub Total B2 1660726 36.90% 1,99,28,712 36.90% Sub Total B1 and B2 1760126 39.11% 2,11,21,512 39.11% TOTAL 45,00,000 100.00% 5,40,00,000 100.00% Note: i. Pre-Issue Shareholding is based on the shareholding of the Company as on December 31, 2010 ii. Post Issue Shareholding is based on the assumption that all the shareholders will subscribe to the full extent to their Rights Entitlement in this Issue. iii. Our Company has forfeited 24,400 partly paid-up equity shares with effect from February 10, 2011. The paid-up Equity Shares of our Company has reduced to that extent. The shareholding of the Promoter would therefore be 61.22% on the reduced fully paid-up Equity Shares of the Company as on the date of this Draft Letter of Offer. The post Issue no. of Equity Shares is thus 53,707,200.

Shareholding Pattern of our Company as per Clause 35 of the Listing Agreement as on December 31, 2010:

Total Shares pledged Shareholding as Total No. or otherwise a % of total No. of Shares encumbered No. of of Shares Total No. held in Category of Shareholder Share of Shares Demat- As a % holders As a % As a % of erialized Number of of Total Form of shares (A+B) (A+B+C) No. of Shares (A) Shareholding of Promoter and Promoter Group (1) Indian

Bodies Corporate 1 2,739,874 2,739,874 60.89 60.89 2,295,600 83.78 Sub Total 1 2,739,874 2,739,874 60.89 60.89 2,295,600 83.78 (2) Foreign

Total shareholding of Promoter and 1 2,739,874 2,739,874 60.89 60.89 2,295,600 83.78 Promoter Group (A) (B) Public Shareholding

(1) Institutions

Mutual Funds / UTI 3 99,000 - 2.20 2.20 - - Financial Institutions / Banks 1 400 - 0.01 0.01 - - Sub Total (B)(1) 4 99,400 - 2.21 2.21 - - (2) Non-Institutions

Bodies Corporate 51 249,100 16,100 5.54 5.54 - - Individuals - -

Individual shareholders holding nominal 4,050 969,880 52,700 21.55 21.55 - - share capital up to Rs. 1 lakh Individual shareholders holding nominal 11 417,546 63,246 9.28 9.28 - - share capital in excess of Rs. 1 lakh Any Others (Specify) - - Non Resident Indians 17 20,100 - 0.44 0.44 - - Hindu Undivided Families 3 2,400 2,400 0.05 0.05 - - Clearing Members 6 1,700 1,700 0.04 0.04 - - Sub Total (B)(2) 4,138 1,660,726 136,146 36.90 36.90 - - Total Public shareholding (B) 4,142 1,760,126 136,146 39.11 39.11 - - Total (A)+(B) 4,143 4,500,000 2,876,020 100.00 100.00 2,295,600 51.01 (C) Shares held by Custodians and against which Depository Receipts have been ------issued (1) Promoter and Promoter Group ------(2) Public ------Sub Total ------Total (A)+(B)+(C) 4,143 4,500,000 2,876,020 - 100.00 2,295,600 51.01 Note: Our Company has forfeited 24,400 partly paid-up equity shares with effect from February 10, 2011. The Equity Shares outstanding would reduce to that extent. The shareholding of the Promoter would

therefore be 61.22% on the reduced outstanding Equity Shares of the Company as on the date of this Draft Letter of Offer

14. The details of our shareholders holding more than 1% of the share capital of our company in the public category as on December 31, 2010 is as follows:

Sl. No. Name of the Shareholder No. of Equity Percentage Shares Holding 1 Shri Kamal Kumar G Jalan 2,86,700 6.37% 2 Canara Bank Trustee Canbank Mutual Fund 91,700 2.04% 3 Saar Finvest Private Limited 46,500 1.03% 4,24,900 9.44%

15. 22,95,600 Equity shares, held by our promoter, ICL Financial Services Limited, constituting 83.78% of the holding of the Promoter and 51.29% of the total Equity Shares outstanding as on the date of this Draft Letter of Offer have been pledged with Axis Trustee Services Limited, acting as trustee for the lenders to the Company, for securing the financial facilities availed by the Company.

16. None of our Promoters, Promoter Group Entities, Directors or the relatives thereof have financed the purchase of the Equity Shares of our Company by any other person or entity during the period of six months immediately preceding the date of filing the Draft Letter of Offer with SEBI.

17. The present Issue being a rights issue, provision of Promoters’ contribution and lock-in are not applicable.

18. If our Company does not receive minimum subscription of 90% of the Issue (separately for Equity Shares and OCRPS) or the subscription level falls below 90% after the Issue Closing Date, on account of cheques being returned unpaid or withdrawal of applications our Company shall forthwith refund the entire subscription amount received in respect of the Equity Shares or OCRPS, as the case may be, within 15 days from the Issue Closing Date. If there is a delay in the refund of subscription by more than eight days after the Company becomes liable to pay the subscription amount (i.e. 15 days after closure of the Issue), the Company will pay interest at the rate of 15% per annum for the delayed period, under subsections (2) and (2A) of Section 73 of the Companies Act, 1956.

19. Details regarding Top 10 Shareholders:

The details of top 10 shareholders and the number of shares held by them are as below:

A. As on date of the Draft Letter of Offer with Stock Exchange

Sl. Name of Shareholder Number of % age holding No. Shares 1 ICL Financial Services Limited 2739874 61.22 2 Shri Kamal Kumar G Jalan 262500 5.87 3 Canara Bank Trustee Canbank Mutual Fund 90700 2.03 4 Hornic Investment Private Ltd. 54900 1.23 5 Saar Finvest Private Ltd. 46500 1.04 6 Columbia Leasing and Finance Ltd. 30800 0.69 7 Singhal Leasing and Construction Pvt Ltd. 33300 0.74 8 Shreyash Securities and Finance Ltd. 35200 0.79 9 Smt Suchita Kakrecha 25146 0.56 10 Shri Rajesh Agrawal 15000 0.34

B. As on 10 days before filing the Draft Letter of Offer with Stock exchange :

Sl. Name of Shareholder Number of % age holding No. Shares 1 ICL Financial Services Limited 2739874 61.22 2 Shri Kamal Kumar G Jalan 262500 5.87 3 Canara Bank Trustee Canbank Mutual Fund 90700 2.03 4 Hornic Investment Private Ltd. 54900 1.23 5 Saar Finvest Private Ltd. 46500 1.04 6 Columbia Leasing and Finance Ltd. 30800 0.69 7 Singhal Leasing and Construction Pvt. Ltd. 33300 0.74 8 Shreyash Securities and Finance Ltd. 35200 0.79 9 Smt Suchita Kakrecha 25146 0.56 10 Shri Rajesh Agrawal 15000 0.34

C. Two years prior to filing the Draft Letter of Offer with the Stock Exchange

Sl. Name of Shareholder Number of % age holding No. Shares 1 Shri Manoj Agrawal 6,17,334 13.72 2 Shri Sanjay Agrawal 5,17,367 11.50 3 Shri Kamal Kumar G Jalan 2,67,200 5.94 4 Shri Dinanath Agrawal 2,16,733 4.82 5 Shubham Investment & Finance Pvt. Ltd. 1,94,700 4.33 6 Intermetal Trade Limited 1,43,700 3.19 7 E Metals India Limited 1,30,700 2.90 8 The United Western Bank Limited 1,15,700 2.57 9 Tutor Investment & Finance Pvt. Ltd. 1,14,600 2.55 10 Smt Neena Agrawal 1,11,200 2.47

20. Our Company has not made any public offering, preferential allotment or QIP Placement of our Equity Shares in the two years immediately preceding the date of filing this Draft Letter of Offer with SEBI.

21. We confirm that there will be no further issue of capital whether by way of issue of bonus shares, preferential allotment, rights issue or in any other manner will be made by our Company during the period commencing from submission of the Draft Letter of Offer with SEBI till the securities referred to in this Draft Letter of Offer have been listed, or application money is refunded on account of failure of the Issue.

22. As on the date of filing of this Draft Letter of Offer, our Company has 4136 shareholders.

23. At any given point of time there shall be only one denomination for Equity Shares of our Company and we shall comply with such disclosure and accounting norms as may be prescribed by SEBI.

24. Our Company has not raised any bridge loan against the proceeds of this Issue.

25. The Securities offered through this Issue shall be fully paid-up on allotment and the entire amount of Rs. 22.50 per Equity Share and Rs.100 per OCRPS is payable on application.

26. The Equity Shares of our Company are fully paid up and there are no partly paid up Equity Shares as on the date of this Draft Letter of Offer.

27. Our Company or the Lead Manager has not entered into any buyback or standby arrangements for the purchase of Equity Shares or OCRPS of our Company.

28. The Issue will remain open for 15 days. However, the Board will have the right to extend the Issue period as it may determine but not exceeding 30 days from the Issue Opening Date

29. The Promoter, Directors and Lead Manager to the Issue have not paid any amount, whether direct or indirect and in cash or kind, in the nature of discount, commission, allowance or otherwise to any person.

30. The Lead Manager to the Issue and their associates do not hold any Equity Shares in our Company.

31. India Cements and ICLFSL, vide joint undertaking dated March 29, 2011, have undertaken to:

OBJECTS OF THE ISSUE

The primary object of the Issue is to discharge, to the extent possible, unsecured loan availed by the Company from our Promoter/Promoter Group, which as on January 31, 2011 aggregates to Rs. 591.66 Crore.

Our Company was discharged from the purview of the BIFR in March 2009. During the same year, ICLFSL acquired majority shareholding of our Company. Subsequently, our Company resumed construction of a cement plant at Banswara, Rajasthan. The total cost of the Plant was approx Rs. 600 Cr. The Plant was proposed to be funded with an equal mix of debt and promoter’s contribution. Accordingly, the Company obtained sanction of term loans of upto Rs. 300 Cr. from our Lenders. The balance amount was to be funded by way of fresh issue of share capital. In the interim period, the Company availed unsecured loans from the Promoter Group to fund the project.

The cement Plant at Banswara, Rajasthan, was subsequently completed and commercial production of cement commenced from January 2011. Further, we have also taken additional funding from our Promoter Group companies for various requirements, including cost overruns on the construction of the Plant, operations of the Plant, working capital requirements, funding for any proposed acquisitions of additional land, etc., and the total amount of unsecured loan outstanding from our Promoter/Promoter Group entities as on January 31, 2011 has accumulated to Rs. 591.66 Crore.

Subsequent to the completion of the Plant, it is now proposed to improve financial leverage of the Company and reduce interest cost burden by part-repayment of the unsecured loans obtained from Promoter Group entities, from the Net Proceeds of the Issue.

As per the loan agreement entered into with our Lenders, the repayment of unsecured loan obtained from India Cements/ICLFSL requires us to take prior approval of the Lenders. Vide letter dated February 17, 2011, Yes Bank Limited, on behalf of itself and other Lenders, provided approval for conversion of unsecured loans of India Cements into equity or cumulative redeemable preference shares. Additionally, approval from the Lenders for repayment of unsecured loans from the proceeds of the Issue is also being sought.

India Cements, by way of a letter dated March 10, 2011, has certified that as on January 31, 2011, a sum of Rs. 591.66 Cr. is recorded in their books of accounts as amount outstanding from our Company, representing the principal amount and the accumulated interest towards the unsecured loan. Our Company has acknowledged the amount by way of its acceptance to the same letter.

Proceeds of the Issue and Issue Expenses

The details of the proceeds of the Issue are summarized in the following table:

Description Amount (Rs. Cr.) Gross proceeds of the Issue *●+ Discharge of Promoter Loan by the subscription amount *●+ to be contributed by the Promoter Issue expenses *●+ Net Proceeds of the Issue *●+

The Issue related expenses include, inter alia, Issue management fees, printing and distribution expenses, legal fees, advertisement expenses and registrar and depository fees. Expenses related to the Issue will be borne by the Company.

A detailed breakup of the Issue expenses is set forth in the table below:

Activity/Expense Estimated Percentage of Percentage of Amount (Rs.in total Issue total Issue size crore) expenses (%) (%) Fees of the Lead Manager, Registrar to the *●+ *●+ *●+ Issue, Bankers to the Issue, legal advisor and for other professional services Advertising, traveling and marketing *●+ *●+ *●+ expenses Printing and stationery expenses *●+ *●+ *●+ Total *●+ *●+ *●+

India Cements and ICLFSL, vide joint letter dated March 29, 2011, have undertaken to:

India Cements, vide the same letter, has informed our Company that either India Cements or ICLFSL be allowed to subscribe to any number of Securities for the purpose of points (a), (b) and (c) mentioned above by discharge of the Company’s liability towards the outstanding amount of the unsecured loan from India Cements to that extent. Accordingly, our Company’s liability to repay the outstanding unsecured loan from India Cements shall be discharged to the extent of the final subscription amount payable by India Cements/ICLFSL, and they shall not be required to make any payment in the escrow accounts opened for the purpose of the Issue.

Subscription by India Cements/ICLFSL of additional Equity Shares beyond their Rights Entitlement shall (i) not result in a change of control of the management of the Company; and (ii) be exempt from the applicability of Regulations 10, 11 and 12 of the Takeover Code in terms of the proviso to Regulation 3(1)(b)(ii) of the Takeover Code.

We further confirm that there is no intention to de-list the Equity Shares of the Company from the Bombay Stock Exchange Limited, even if, as a result of allotments to us or to the other Promoter Group entities in the Issue, the cumulative public shareholding of the Company falls below the minimum level as prescribed under the Listing Agreement and, in such an event, we undertake to comply with the Listing Agreement, including the provisions of clause 40A thereof and other applicable laws.

Interim Use of Proceeds

The management of the Company, in accordance with the policies set up by the Board of Directors, will have flexibility in deploying the proceeds of the Issue after deducting the Issue expenses. Pending utilization for the purposes described above, the Company intends to temporarily invest the funds in interest bearing liquid investments and instruments, including money market mutual funds and deposits with banks and corporates, excluding Promoter Group entities. Such investments will be in accordance with the decisions of the Board of Directors from time to time.

Bridge Loan Facilities

Other than as disclosed, the Company has not availed of any bridge loan to be repaid from the proceeds of the Issue.

Monitoring of Utilization of Funds

The Board of Directors or a committee thereof will monitor the utilization of the proceeds of the Issue. The Company will disclose the utilization of the proceeds of the Issue under a separate head in its balance sheet until the Issue proceeds remain unutilized and to the extent required under applicable law and regulation, clearly specifying the purposes for which such proceeds have been utilized. The Company will also, in its balance sheet for the relevant Fiscal periods, provide details, if any, in relation to all such proceeds of the Issue that have not been utilized thereby also indicating investments, if any, of such unutilized proceeds of the Issue.

The objects clause of the Memorandum enables the Company to undertake the activities for which the funds are being raised pursuant to the Issue. The existing activities of the Company are within the ambit of the objects clause of the Memorandum.

BASIS FOR ISSUE PRICE The Issue Price has been determined in consultation with Lead Manager considering the following qualitative and quantitative factors. Investors should also refer to the section “Risk Factors” and “Financial Information” at pages ix and 95 respectively to get a more informed view before making the investment decisions.

Qualitative Factors:

1. Experienced Promoters and Management Team

2. Proximity to raw materials and customers

3. Ability to utilize India Cements’ marketing channels

Quantitative Factors

The information presented in this section is derived from our restated financial statements:

1. The price paid by ICLFSL, our Promoter, for acquisition of Equity Shares from the erstwhile promoters of our Company and the resulting open offer was Rs. 22.50 per Equity Share.

2. Adjusted Earnings Per Equity Share, after extraordinary items (“EPS”)

Period EPS (Rs.) Weight 31-March 2008 5.21 1 31 March 2009 (11.53) 2 31 March 2010 1.28 3 Weighted Average (2.34)

3. Price/Earning Ratio (P/E) in relation to Issue Price of Rs 22.50/- per Equity Share, based on EPS for the year ended March 31, 2010 of Rs 1.28 is 17.57 times

Industry P/E: Highest : 79.5 Lowest - 4.4 Average 17.9 Source: Capital Market, Vol. XXVI/01, Mar 7-20, 2011, Cement – North India

4. Return on Net Worth (RONW)

Particulars RONW Weights 31 March 2008 17.91% 1 31 March 2009 (53.85)% 2 31 March 2010 5.63% 3 Weighted Average RONW (12.15)%

5. Minimum Return on increased Net Worth needed after the Issue to maintain pre-Issue EPS of Rs. 1.28 is 2.22% before conversion of OCRPS into Equity Shares and 5.17% post conversion of OCRPS into Equity Shares.

6. Net Asset Value per Equity Share(Rs.)

As on September 30, 2010 16.82 After the Issue 22.03 Issue Price per Equity Share 22.50 *NAV per Equity Share after the Issue assumes 100% subscription of the Equity Share portion of the Issue.

7. Comparison of Accounting Ratios with Peer Group Companies

Sl No Particulars EPS (Rs.) P/E Ratio RONW (%) NAV (Rs.) 1 ACC Limited 59.7 16.3 29.4 344.6 2 Ambuja Cements Limited 8.1 14.6 20.1 47.9 3 Ultratech Cement Limited 39.4 28.2 26.6 173.6 4 Shree Cement Limited 191.5 79.5 44.4 526.2 Trinetra Cement Limited 1.28 17.57* 5.63 22.69 Source: Capital Market, Vol. XXVI/01, Mar 7-20, 2011, Cement – North India

All the figures are based on financial statements for the year ended 31.03.2010

*Based on the Issue price of Equity Shares

8. The face value of Equity Shares is Rs.10/- and the Issue Price of Equity Shares, Rs.22.50 is 2.25 times of the face value of our Equity Shares. The face value of the OCRPS is Rs. 100/- each and are being issued at par.

9. The Lead Manager believes that the Issue Price of Rs. 22.50 per Equity Share and Rs. 100.00 per OCRPS is justified in view of the above qualitative and quantitative parameters. Investors may also want to peruse the risk factors and our financial statements as set out in the Draft Letter of Offer to have a more informed view about the investment proposition.

Formulae used:

1. Basic EPS has been calculated as: Net Profit (excluding extraordinary items net of tax)/ Weighted average number of Equity Shares outstanding during the year.

2. Earnings per Equity Share calculations are in accordance with Accounting Standard 20 - “Earnings per Share” issued by the Institute of Chartered Accountants of India.

3. The face value of each Equity Share is Rs.10/-

4. P/E: Issue Price / Earnings per equity share

5. Return on Net Worth: Net Profit (excluding extraordinary items, net of tax) / Net Worth at the end of the financial year.

6. Net Asset Value Per Equity Share: Net Worth at the end of the financial year / Weighted average number of Equity Shares outstanding during the year.

STATEMENT OF TAX BENEFITS

The tax benefits listed below are the possible benefits available under the current tax laws presently in force in India. Several of these benefits are dependent on the Company or its shareholders fulfilling the conditions prescribed under the relevant tax laws. Hence, the ability of the Company or its shareholders to derive the tax benefits is dependent upon fulfilling such conditions, which based on business imperative it faces in the future, it may or may not choose to fulfill. This statement is only intended to provide the tax benefits to the company and its shareholders in a general and summary manner and does not purport to be a complete analysis or listing of all the provisions or possible tax consequences of the subscription, purchase, ownership or disposal etc. of shares. In view of the individual nature of tax consequence and the changing tax laws, each investor is advised to consult his/her own tax adviser with respect to specific tax implications arising out of their participation in the issue

SPECIAL TAX BENEFITS

1. SPECIAL TAX BENEFITS AVAILABLE TO THE COMPANY

There are no special tax benefits available to the company.

2. SPECIAL TAX BENEFITS AVAILABLE TO THE SHAREHOLDERS OF THE COMPANY

There are no special tax benefits available to the shareholders of the company.

GENERAL TAX BENEFITS

1. Key benefits available to the Company under the Income-tax Act, 1961 (“the Act”)

A. BUSINESS INCOME:

I. Depreciation

The company is entitled to claim depreciation on specific tangible and intangible assets owned by it and used for the purpose of its business under Section 32 of the Act at the rates specified.

In case of any new plant and machinery (other than ships and aircraft) that will be acquired by the company, the company is entitled to a further sum equal to twenty percent of the actual cost of such machinery or plant subject to conditions specified in Section 32(1)(iia) of the Act in the year in which it is first put to use.

Unabsorbed depreciation, if any, for an Assessment Year (AY) can be carried forward and set off against any source of income in the subsequent AYs as per section 32 read with Section 72(2) and Section 73(3) of the Act.

II. Preliminary expenses

As per Section 35D, the company is eligible for deduction in respect of specified preliminary expenses incurred by the company, in connection with extension of its industrial undertaking or in connection with setting up a new industrial unit of an amount equal to 1/5th of such expenses over 5 successive AYs subject to conditions and limits specified in the said section.

III. Expenditure incurred on voluntary retirement scheme:

As per Section 35DDA, the company is eligible for deduction in respect of payments made to its employees in connection with their voluntary retirement of an amount equal to 1/5th of such payments over 5 successive AYs subject to conditions and limits specified in that section.

IV. Expenditure on Scientific Research

As per Section 35, the company is eligible for deduction in respect of any expenditure (not being expenditure on the acquisition of any land) on scientific research related to the business subject to conditions specified in that section.

V. Carry forward of business loss:

Business losses, if any, for any AY can be carried forward and set off against business profits for eight subsequent AYs.

VI. MAT Credit

The Company would be required to pay tax on its book profits under the provisions of section 115JB in case where tax on its “total income” *the term defined under section 2(45) of the IT Act] is less than 10% of its book profit (the term defined under section 115JB of the IT Act). Such tax is referred to as Minimum Alternate Tax (MAT.)

The difference between the MAT payable under section 115JB of the IT Act and the tax on its total income payable for that assessment year shall be allowed to be carried forward as “MAT credit” upto 7 assessment years succeeding the assessment year in which such MAT was paid in accordance with the provisions of section 115JAA of the IT Act as amended by the Finance Act, 2006 (earlier upto 5 assessment years). The MAT credit can be utilized to be set off against taxes payable on the total income computed under the provisions of the IT Act other than 115JB thereof if any, in the subsequent assessment years in accordance with the provisions of section 115JAA of the IT Act.

B. CAPITAL GAINS:

I. a. Long Term Capital Gain (LTCG)

LTCG means Capital Gain arising from the transfer of a capital asset being share held in a company or any other security listed in a recognized stock exchange in India or unit of

the Unit Trust of India or a unit of a mutual fund specified under clause (23D) of section 10 or a Zero-coupon bond, held by an assessee for more than 12 months.

In respect of any other capital assets, LTCG means capital gain arising from the transfer of an asset, held by an assessee for more than 36 months.

b. Short Term Capital Gain (STCG)

STCG means Capital gain arising from the transfer of capital asset being share held in a company or any other security listed in a recognized stock exchange in India or unit of the Unit Trust of India or a unit of a mutual fund specified under clause (23D) of section 10 or a Zero-coupon bond, held by an assessee for 12 months or less.

In respect of any other capital assets, STCG means capital gain arising from the transfer of an asset, held by an assessee for 36 months or less.

II. a. LTCG arising on transfer of equity share of a company or units of an equity oriented fund (as defined) which has been set up under a scheme of a mutual fund specified under section 10(23D), on a recognized stock exchange on or after October 1, 2004 are exempt from tax under section 10(38) of the Act provided the transaction is chargeable to securities transaction tax (STT) and subject to conditions specified in that section.

b. With effect from AY 2007-08, income by way of LTCG exempt u/s 10(38) of a company is taken into account in computing book profit and income tax is payable under section 115JB.

III. As per third proviso to Section 48, LTCG arising on transfer of capital assets, which is chargeable to tax other than bonds and debentures (excluding capital indexed bonds issued by the Government), is to be computed by deducting the indexed cost of acquisition and indexed cost of improvement from the full value of consideration.

a. As per section 112, LTCG is taxed @ 20% plus applicable surcharge thereon and 3% Education and Secondary & Higher education cess on tax plus Surcharge (if any) (hereinafter referred to as applicable Surcharge + Education and Secondary & Higher Education Cess)

b. However as per proviso to section 112(1), if such tax payable on transfer of listed securities / units / Zero coupon bond which is chargeable to tax, exceeds 10% of the LTCG, without availing benefit of indexation, then the excess tax shall be ignored.

IV. As per section 111A of the Act, STCG arising on sale of equity shares of company or units of equity oriented mutual fund [as defined under Section 10(23D)], on a recognized stock exchange are subject to tax at the rate of 15 percent (plus applicable surcharge + Education and Secondary & Higher Education cess), provided the transaction is

chargeable to STT. In other case, i.e. where the transaction is not subjected to STT, the short term capital gains would be chargeable as a part of the total income and the tax rates would depend on the income slab.

V. As per section 71 read with section 74, short term capital loss arising during a year is allowed to be set-off against short term as well as long term capital gains for subsequent 8 years.

VI. As per section 71 read with section 74, long term capital loss arising during a year is allowed to be set-off only against long term capital gains. Balance loss if any, should be carried forward and set-off against subsequent year’s long term capital gains for subsequent 8 years.

VII. Under section 54EC of the Act, capital gains arising on transfer of a long term capital asset is exempt from capital gains tax if such capital gains are invested within a period of six months after the date of such transfer in specified bond issued by the following and subject to the conditions specified therein:-

 National Highway Authority of India constituted under section 3 of National Highway Authority of India Act, 1988.  Rural Electrification Corporation Limited, a company formed and registered under the Companies Act, 1956.

If only part of the long term capital gain is reinvested, the exemption shall be proportionately reduced.

However, if the new bonds are transferred or converted into money within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier, shall be taxable as Capital gains in the year of transfer or conversion.

With effect from 1st April, 2007 the investment in the Long Term Specified Asset made by the company during a financial year should not exceed 50 Lakh rupees.

C. INCOME FROM OTHER SOURCES

Dividend income:

Under Section 10(34) of the IT Act, income by way of dividend referred to in Section 115-O received by the Company on its investments in shares of another Domestic company is exempt from income tax in the hands of the Company.

Income received in respect of units of a mutual fund specified under Section 10(23D) of the Act (other than income arising from transfer of units in such mutual fund) shall be exempt from tax under section 10(35) of the Act.

If a domestic company receives dividend from another domestic company, in which it holds more than 50% of the equity share capital, then the domestic company receiving the dividend

will be eligible to deduct the amount of dividend so received from the amount of dividend declared by it, for the purpose of computation of Dividend Distribution Tax u/s 115-O.

However, it is pertinent to note that section 14A of the IT Act provides that no deduction shall be allowed in respect of any expenditure incurred in relation such exempt income.

D. OTHERS

To the extent the funds raised from the proposed Rights Offer of Equity Shares are utilized to reduce the debts raised for investment purposes, the corresponding interest expenses of the company will be reduced and the consequential disallowance of such interest expenses under Section 14A of the Act will be reduced.

2. Key benefits available to the Members of the Company

2.1 Resident Members a. Dividend income:

Dividend (both interim and final) income, if any, received by the resident shareholders from a Domestic Company shall be exempt from tax under Section 10(34) read with Section 115O of the Act. However, it is pertinent to note that section 14A of the IT Act provides that no deduction shall be allowed in respect of any expenditure incurred in relation such exempt income. b. Capital gains: i) Benefits outlined in Paragraph 1(B) excluding sub-paragraph II(b) thereof, are also applicable to resident shareholders. In addition to the same, the following benefits are also available to resident shareholders. ii) As per Section 54F of the Act, LTCG arising from transfer of shares will be exempt from tax if net consideration from such transfer is utilized within a period of one year before, or two years after the date of transfer, for purchase of a new residential house, or for construction of residential house within three years from the date of transfer and subject to conditions and to the extent specified therein.

2.2 Key Benefits available to Non-Resident Member a. Dividend Income:

Dividend (both interim and final) income, if any, received by the non-resident shareholders from a Domestic Company shall be exempt from tax under Section 10(34) read with Section 115-O of the Act. However, it is pertinent to note that section 14A of the IT Act provides that no deduction shall be allowed in respect of any expenditure incurred in relation such exempt income.

b. Capital gains:

Benefits outlined in Paragraph 2.1(b) above are also available to a non-resident shareholder except that as per first proviso to Section 48 of the Act, the capital gains arising on transfer of capital assets being shares of an Indian Company need to be computed by converting the cost of acquisition, expenditure in connection with such transfer and full value of the consideration received or accruing as a result of the transfer into the same foreign currency in which the shares were originally purchased. The resultant gains thereafter need to be reconverted into Indian currency. The conversion needs to be at the prescribed rates prevailing on dates stipulated. Further, the benefit of indexation as provided in second proviso to section 48 is not available to non-resident shareholders. c. Tax Treaty Benefits:

As per Section 90 of the Act, the shareholder can claim relief in respect of double taxation if any as per the provision of the applicable double taxation avoidance agreements. d. Special provision in respect of income / LTCG from specified foreign exchange assets available to non-resident Indians under Chapter XII-A.

i. Non-Resident Indian (NRI) means a citizen of India or a person of Indian origin who is not a resident. Person is deemed to be of Indian origin if he, or either of his parents or any of his grandparents, were born in undivided India. ii. Specified foreign exchange assets include shares of an Indian company acquired/purchased/ subscribed by NRI in convertible foreign exchange. iii. As per section 115E, income [other than dividend which is exempt under Section 10(34)] from investments and LTCG from assets (other than specified foreign exchange assets) shall be taxable @ 20% (plus applicable Surcharge + Education and Secondary & Higher Education Cess). However, indexation benefit will not be available for computation of capital gain. Further, no deduction in respect of any expenditure allowance from such income will be allowed and no deductions under chapter VI-A will be allowed from such income. iv. As per section 115E, LTCG arising from transfer of specified foreign exchange assets shall be taxable @ 10% (plus applicable Surcharge + Education and Secondary & Higher Education Cess). However indexation benefit will not be available for determining the amount of capital gain chargeable to tax. v. As per section 115F, LTCG on transfer of specified foreign exchange asset shall be exempt under Section 115F, in the proportion of the net consideration from such transfer being invested in specified assets or savings certificates within six months from date of such transfer, subject to further conditions specified under Section 115F. vi. As per section 115G, if the income of an NRI taxable in India consists only of income/LTCG from such shares and tax has been properly deducted at source in respect of such income in accordance with the Act, it is not necessary for the NRI to file return of income under Section 139. vii. As per section 115H, where the NRI becomes assessable as a resident in India, he may furnish a declaration in writing to the Assessing Officer, along with his return of

income, for the assessment year, in which he is first assessable as a resident, under section 139 of the Act to the effect that the provisions of the chapter XII-A shall continue to apply to him in relation to such investment income derived from the specified assets for that year and subsequent years until such assets are transferred or converted into money. viii. As per section 115I, the NRI can opt not to be governed by the provisions of chapter XII-A for any AY by declaring the same in the return of income filed under Section 139 in which case the normal benefits as available to non-resident shareholders will be available.

2.3 Key Benefits available to Foreign Institutional Investors (FIls)

1. Dividend Income:

i. Dividend (both interim and final) income, if any, received by the shareholder from the domestic company shall be exempt from tax under Section 10(34) read with Section 115-O of the IT Act. However, it is pertinent to note that section 14A of the IT Act provides that no deduction shall be allowed in respect of any expenditure incurred in relation such exempt income. ii. Under Section 115AD, income (other than income by way of dividends referred in Section 115O) received in respect of securities (other than units referred to in Section 115AB) shall be taxable at the rate of 20% (plus applicable Surcharge + Education and Secondary & Higher Education Cess). No deduction in respect of any expenditure/allowance shall be allowed from such income.

2. Capital Gains:

i. The characterization of gain or loss i.e whether business income or capital gain would depend on the nature of holding in hands of members and various other factors.

ii. Under Section 115AD, capital gains arising from transfer of securities (other than units referred to in Section 115AB), shall be taxable as follows:  As per section 111A, STCG arising on transfer of securities where such transaction is chargeable to STT, shall be taxable at the rate of 15% (plus applicable Surcharge + Education and Secondary & Higher Education Cess). STCG arising on transfer of securities where such transaction is not chargeable to STT, shall be taxable at the rate of 30% (plus applicable Surcharge + Education and Secondary & Higher Education Cess).  LTCG arising on transfer of securities where such transaction is not chargeable to STT, shall be taxable at the rate of 10% (plus applicable Surcharge & Education and Secondary & Higher Education Cess). The benefit of indexation and benefit of foreign exchange fluctuation, as mentioned under 1st and 2nd proviso to section 48 would not be allowed while computing the capital gains.

3. Exemption of capital gains from income-tax:

i. LTCG arising on transfer of a long term capital asset, being an equity share in a company or a unit of an equity oriented fund, where such transaction is chargeable to STT is exempt from tax under Section 10(38) of the Act. ii. Benefit of exemption under Section 54EC shall be available as outlined in Paragraph 1(B) (vii) above.

4. Tax Treaty Benefits:

As per Section 90 of the Act, a shareholder can claim relief in respect of double taxation, if any, as per the provision of the applicable double taxation avoidance agreements.

2.4 Key Benefits available to Mutual Funds

As per the provisions of Section l0 (23D) of the Act, any income of mutual funds registered under the Securities and Exchange Board of India Act, 1992 or Regulations made there under, mutual funds set up by public sector banks or public financial institutions and mutual funds authorized by the Reserve Bank of India, would be exempt from income-tax, subject to the prescribed conditions. However, it is pertinent to note that section 14A of the IT Act provides that no deduction shall be allowed in respect of any expenditure incurred in relation such exempt income.

3. Wealth Tax Act, 1957

Shares in a company, held by a shareholder are not treated as an asset within the meaning of Section 2(ea) of the Wealth Tax Act, 1957; hence, wealth tax is not leviable on shares held in a company.

4. The Gift Tax Act, 1958

Gift of shares of the company made on or after October 1, 1998 are not liable to Gift Tax. However, as per newly inserted Section 56(2)(vi) in the Income-tax Act, value of sum of money/ immovable property/ movable property received without consideration or for inadequate consideration, if in excess of Rs. 50000/-, shall be chargeable to income-tax with effect from 1st October 2009 subject to exemptions mentioned therein.

Notes:

a. All the above benefits are as per the current tax law and will be available only to the sole/first named holder in case the shares are held by joint holders. b. In respect of non-residents, the tax rates and the consequent taxation mentioned above will be further subject to any benefits available under the relevant Double Tax Avoidance

Agreement (DTAA), if any, between India and the country in which the non-resident has fiscal domicile. c. Wherever applicable, the benefits mentioned hereinabove are subject to fulfilment of the specified conditions and up to the limits as mentioned in the relevant provisions. d. In view of the individual nature of tax consequences, each investor is advised to consult his/her own tax advisor with respect to specific tax consequences of his/her participation in the scheme. e. Our views expressed herein are based on the facts and assumptions indicated above. No assurance is given that the revenue authorities/ courts will concur with the views expressed herein. Our views are based on the existing provisions of law and its interpretation, which are subject to change from time to time. We do not assume responsibility to update the views consequent to such changes.

SECTION IV – ABOUT US

CEMENT INDUSTRY

Pursuant to the requirements of the SEBI (ICDR) Regulations, the discussion on the business of Our Company in this Draft Letter of Offer consists of disclosures pertaining to industry grouping and classification. The industry grouping and classification is based on Our Company's own understanding and perception and such understanding and perception could be substantially different or at variance from the views and understanding of third parties. Our Company acknowledges that certain products described in the Draft Letter of Offer could be trademarks, brand names and or generic names of products owned by third parties and the reference to such trademarks, brand names and/or generic names in the Draft Letter of Offer is only for the purpose of describing the products. Unless otherwise indicated, quantitative information relating to the cement industry in India has been taken from reports and data compiled by the Cement Manufacturer’s Association (“CMA”).

Two large cement manufacturers disassociated themselves from CMA during FY10 and subsequently, data pertaining to their manufacturing and sales activities is not available with CMA post June 30, 2009. Accordingly, for the sake of correct representation, data in this section has been restricted to June 30, 2009 or earlier. However, to provide an understanding of the current industry position, management information for industry figures have also been provided in certain places in this section.

Cement Industry Overview

Cement production in India commenced in 1914. Severe competition from imported cement, coupled with various governmental price and distribution controls, resulted in slow growth of the Indian cement industry in the earlier years. In the subsequent 65 years, only 27 MT of capacity was added. This situation was reversed in the 1980s when the industry was partially decontrolled. This resulted in substantial increase in capacity and production. Nearly 30 MT of capacity was added during the 11 years from 1980 to 1990, thereby adding more capacity during one decade than had been added during the previous seven decades. Encouraged by the creation of substantial new capacity and the lowering of prices, the Government freed the industry from price and distribution controls on March 1, 1989 and delicensed it on July 25, 1991, leading to a significant increase in cement production capacities. During the period from 1991 to June 2009, approximately 169.86MT (installed) of fresh capacity was added. Save for recent years in which demand has exceeded supply, for the most part since the 1980s, cement capacity in India has steadily outpaced demand. India has grown to become the second largest cement producer in the world, after China, with installed capacity of approximately 229.17 MT in June 2009. India is also estimated to have approximately 90 billion tonnes of limestone reserves, the main raw material used in the manufacture of cement.

As of June 30, 2009, the Indian cement industry comprised over 45 cement producers, operating 152 large cement plants with an average installed capacity of 227.48 MT over the year. Over the years, the cement industry has made significant progress upgrading and assimilating the latest technology. Actual cement production in 2008-09 was 181.61 MT as against 168.31 MT in 2007- 08, registering a growth rate of 7.9%. Cement demand during the same period was 177.99 MT, registering a 8.51% increase over the previous year. During the three months ended June 30,

2009, cement demand increased by over 11.51% as compared to demand in the three months ended June 30, 2008.

Indian Cement Capacity, Production, Capacity Utilisation Rate and Demand

During 1999-2000 to 2008-09, the installed capacity of the industry increased at a CAGR of 7.85% to 219 MT. During the same period, while there was no significant change in capacity utilisation, production growth marginally outpaced capacity growth by growing at a CAGR of 7.57%. The table below discusses capacity, production and capacity utilisation in the cement industry for the periods indicated.

FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 Capacity(1) 109.06 115.34 129.67 136.74 143.54 150.85 157.21 165.35 178.77 205.63 (MT) Production 94.21 93.61 102.40 111.35 117.50 127.57 141.81 155.64 168.31 181.61 (MT) Capacity 86.38 81.16 78.97 81.43 81.86 84.57 90.20 94.13 94.15 88.32 Utilization (%) Source: CMA Note: (1) The capacity of the industry is taken as the sum total of the installed capacity of the large players, and does not include the total capacity of mini-cement players (i.e., smaller producers with individual capacity up to 300,000 tonnes), which has been estimated at 12 MT. Capacities are monthly add-ups. Of the total capacity, about 4.60 MT is not in operation. Capacity given here is average capacity for the year and not capacity as at year end.

The Manufacturing Process

The production process for cement consists of drying, grinding and mixing limestone, marl and silica into a powder known as a raw meal. The raw meal is then heated and burned in a preheater and kiln and then cooled in an air cooling system to form a semi-finished product, known as a clinker. Clinker (95%) is cooled by air and subsequently ground with gypsum (5%) to form Ordinary Portland Cement (“OPC”). Other forms of cement require increased blending with

other raw materials. Blending of clinker with other materials helps impart key characteristics to cement, which eventually govern its end use.

Cement is typically manufactured by one of the three processes, wet, semi-dry, or dry. The basic differences between these processes are the form in which the raw meal is fed into the kiln, and the amount of energy consumed in each of the processes. In the dry process, the raw meal is fed into the kiln in the form of a dry powder thereby resulting in energy savings, in the wet process it is fed into the kiln in the form of slurry. The semidry process consumes more energy than the dry process, but lesser than the wet process.

Production Process

There are two general processes for producing clinker and cement in India: a dry process and a wet process. The basic steps involved in such processes are set out below:

Dry process

In dry process production, limestone is crushed to a uniform and usable size, blended with certain additives (such as iron ore and bauxite) and discharged on to a vertical roller mill where the raw materials are ground to fine powder. An electrostatic precipitator dedusts the raw mill gases and collects the raw meal for a series of further stages of blending. The homogenised raw meal thus extracted is pumped to the top of a preheater by air lift pumps. In the preheaters the material is heated to 750°C. Subsequently, the raw meal undergoes a process of calcination in a precalcinator (in which the carbonates present are reduced to oxides) and is then fed to the kiln. The remaining calcination and clinkerisation reactions are completed in the kiln where the temperature is raised to 1,450-1,500°C. The clinker formed is cooled and conveyed to the clinker silo from where it is extracted and transported to the cement mills for producing cement. For producing OPC, clinker and gypsum are used and for producing Portland Pozzolana (Fly Ash) Cement (“PPC”), clinker, gypsum and fly ash are used.

Wet process

The wet process differs mainly in the preparation of raw meal where water is added to raw materials to produce slurry. The chemical composition is corrected and the slurry is then pumped to the kiln where evaporation of moisture, preheating, calcination and sintering reaction takes place. The clinker is cooled and transported as in the case of other plants with suitable conveyors to cement mills for grinding. The wet process is more energy intensive, and thus becomes expensive when power and energy prices are high.

Special cement

The basic process outlined above can be modified slightly in order to make cements with special characteristics. In the case of sulphate resistant cement, the raw mix is designed so as to produce clinker with enhanced iron content. Once the raw mix has been properly designed further processing is similar to the production of OPC.

Cement Varieties

Three basic varieties of Portland cement are sold in India based on the different blending compositions (according to specific end-uses), namely OPC, PPC and Portland Blast Furnace Slag

Cement (“PSC”). The basic difference among these cements is in the percentage of clinker used, and the quantum and nature of blending done at the grinding stage. Since the clinkerisation capacity is the most capital intensive part of a cement plant, blending of cement effectively raises capacity without requiring any significant investments for extra grinding and packing capacity. The quantum of blending in each variety of cement, the requisite strength, and other parameters of the cement variety sold are governed by the Bureau of Indian Standards (“BIS”). The key types of the cements and their uses are discussed below:

Ordinary Portland Cement

OPC is used for general construction purposes, such as in the building of houses, high-rise buildings, bridges and roads and comprised 23.93% of the total cement sales in the country for the three months ended June 30, 2009.

Portland Pozzolana Cement

PPC differs from OPC in that it contains up to 35% pozzolanic materials, in accordance with the Indian standard, with the fly ash from thermal power stations being the most commonly used variety. PPC is also regarded to have better durability properties and is better suited for mass concreting, such as in the construction of dams and barrages. PPC comprised almost 67.23% of total cement sales in India for the three months ended June 30, 2009.

Portland Slag Cement

PSC differs from OPC in that it contains between 25% and 65% granulated blast furnace slag from steel plants, in accordance with Indian industry standards. Since this cement gives rise to more impermeable concrete and is capable of resisting ingress of deleterious reagents, it is better suited for construction in a coastal environment. PSC accounted for 8.46% of the total cement produced in India for the three months ended June 30, 2009.

Over the past few years, there has been a distinct trend towards increasing usage of blended cements having lower quantity of clinker. PPC production as a percentage of total production has more than tripled from being 22.61% in 1999-2000 to being 67.23%for the three months ended June 30, 2009.

Industry Characteristics

Units concentrated in proximity to raw material sources or markets

Since cement is a bulk commodity, transportation costs contribute significantly to its overall cost. In order to minimise these costs, most cement manufacturing units are either located near limestone reserves or markets. As a result, cement manufacture and sale is largely regional in nature with manufacturing units concentrated in specific locations called “clusters”. The twelve states of Madhya Pradesh, Uttar Pradesh (Central Region), Rajasthan, Himachal Pradesh (Northern Region), Chhatisgarh, West Bengal, Orissa (Eastern Region), Gujarat, Maharashtra (Western Region), Karnataka, Tamil Nadu and Andhra Pradesh (Southern Region) account for around 92.21% of total domestic capacity as of June 2009. The concentration of capacity in these regions is largely due to the presence of limestone deposits. As per the Planning Commission, over 45.00% of the inventory of cement grade limestone is in the Southern Region,

followed by the Northern Region with 23.00%, the Western Region with 20.00% and the Eastern Region with 10.40%.

Energy-intensive

Coal and power costs constitute a major share of total cement production costs, depending on the manufacturing process, with the wet process more energy-intensive than the dry process. Coal is used to fire kilns, and as a source of fuel for the captive power plants set up by the cement manufacturers.

To economise on costs, companies are increasingly using high-quality imported coal because of its high calorific content as compared to domestic coal. At the same time they are also shifting to captive power to avoid the high power tariffs and frequent power cuts in certain regions associated with locally supplied grid power.

As a result of these initiatives, average energy consumption in the industry has been declining, resulting in reduced energy costs.

High freight costs

Due to the bulky nature of cement, outward freight costs account for a high proportion of total cost. As a result, companies prefer to be close not only to the limestone quarries, but also to the markets.

Regional variations and volatility in prices and margins

Cement prices and margins vary across regions due to the variation in the supply-demand balance, the level of concentration and demand growth. Historically, prices in the Southern Region have generally been the highest in India. Due to a significant increase in production capacity in 2001 to 2003, prices were subject to intense pressure. In recent years, the demand- supply imbalance has corrected itself, leading to cement prices increasing throughout India. However, in the second half of 2009, cement prices in India, particularly in South India, were subject to downward pressure due to a decrease in demand growth coupled with significant increase in overall production capacity, including from smaller cement manufacturers of 2-3 mtpa, but prices have shown signs of improvement since early 2010 due to the increase in demand from consumers.

Regional distribution of demand

There also exists a significant imbalance in cement demand between the different regions. Cement consumption varies across regions because of the differences in the demand-supply balance, per capita income and the level of industrial development in each state of the region. During April to November, 2010, the Southern Region accounted for the highest proportion of cement consumption (32.2%), followed by the Western Region (17.8%), Eastern Region (17.1%), Northern Region (16.5%) and Central Region (16.3%).

Demand in the Eastern Region has been largely driven by the housing sector, whereas infrastructure, investments in industrial projects and the housing sector (in varying proportions) have had a more significant impact on demand in the Western, Northern and Southern Regions.

Of late due to deficit situation in some regions and cement being manufactured only in nine states, inter regional movement of cement even to longer distances has started taking place which will help in balancing the surplus situation in some of the regions.

Recent Trends

Trends in the creation of fresh capacity

The table below depicts the capacity creation in the last few years (as available):

FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 Capacity Addition (MT) 10.78 13.00 4.44 6.57 7.65 6.40 7.59 30.31 21.41 Percentage increase in 9.70% 10.70% 3.30% 4.70% 5.20% 4.20% 4.70% 18.10% 10.80% capacity Percentage increase in (1.90%) 9.70% 8.70% 5.80% 8.10% 10.10% 10.20% 9.83% 8.51% demand growth

Source: CMA

The significant increase in capacity during the year ended March 31, 2001 and the year ended March 31, 2002 was driven primarily by the impending phasing out of the government’s sales tax incentives. In view of the significant growth in the last few years at around 10% and the healthy financial position of the cement industry, the players are investing heavily in creating new capacities as could be observed from the capacity created in 2007-08 and 2008-09.

The following table sets forth the estimated market share of the largest Indian cement producers for December 2010:

Sl. No. Company/ Group Market Share as in December 2010 1 Grasim Industries Limited and Ultratech 18.01% Cement Company Limited 2 The Associated Cement Companies Limited 17.87% and Gujarat Ambuja Cements Limited 3 Jaypee Cements Limited 6.89% 4 The India Cements Limited 5.86% 5 Madras Cements Limited 4.70%

Source: Management information

OUR BUSINESS

We are in the business of manufacturing and marketing of various types of cement. We have an operational cement plant with a capacity of 1.5 MTPA in Banswara, Rajasthan (“Plant”). We also have a long-term lease of 65.82 hectares of limestone mines (“Mine”). We are also in the process of constructing a 20 MW thermal power plant within the location of our Plant, which is expected to be operational by June, 2011.

Our Company is part of the India Cements group. Our ultimate promoter, The India Cements Limited (“India Cements”), is the largest producer of cement in south India by volume. India Cements owns and operates nine integrated cement manufacturing plants and grinding units in the states of Andhra Pradesh, Tamil Nadu and Maharashtra, and has a total installed capacity of approximately 14 MTPA.

Our Competitive Strengths

1. Experienced Management and Promoters

Our Ultimate promoter, The India Cements Limited has been in the business of cement manufacturing and distribution for over 6 decades and is the largest producer of cement in South India by volume (Source: CMA). Our promoters bring with them their vast knowledge and experience, which shall help us achieve better operational efficiency. Our non-independent directors have substantial experience of managing various functions of the cement business. The head of our Plant, Mr. Karan Vashisht brings with him significant experience in the operations of a cement manufacturing plant.

2. Proximity to raw material and principal markets:

3. Ability to utilize India Cements’ marketing channels

Our Strategy

1. Achieve maximum capacity utilization of our Plant

3. Implement measures to reduce cost We shall try and minimize the cost of our operations through optimizing various parameters and procurement of raw materials from suitable locations so that the purchase price and transportation cost, taken together is the lowest and cost of production is reduced. Further, to reduce production cost and dependence on external sources for electricity, we are also in the process of setting up a 20 MW captive thermal

power plant within the Plant. Simultaneously, we shall also try to minimize wastage in our production process.

4. Secure further linkages to raw materials such as limestone

5. Continue to explore opportunities to expand our capacity, either through establishing new plants or through mergers and acquisitions

MANUFACTURING PROCESS

The manufacturing process of cement is carried out in the following steps:

1. Mining

The cement manufacturing process starts from the mining of limestone, which is the main raw material for making cement. Limestone is excavated from our Mine after drilling and blasting and loaded on to dumpers which transport the material and unload into hoppers of the limestone crushers.

2. Crushing, Stacking and Reclaiming of Limestone

Limestone crushers are used to crush the limestone to sub 80 mm size. This is then discharged onto a belt conveyor which takes it to the stacker via the bulk material analyzer. The material is stacked in longitudinal stockpiles. Limestone is extracted transversely from the stockpiles by the reclaimers and conveyed to the raw mill hoppers for grinding of raw meal.

3. Crushing, stacking and reclaiming of Coal

The process of making cement clinker requires heat. Coal is used as the fuel for providing heat. Raw coal received from the collieries is stored in a coal yard. Raw coal is dropped on a belt conveyor from a hopper and is taken to and crushed in a crusher. Crushed coal discharged from the coal crusher is stored in a longitudinal stockpile from where it is reclaimed by a reclaimer and taken to the coal mill hoppers for grinding of fine coal.

4. Raw meal drying/ grinding and homogenization

Reclaimed limestone along with some laterite stored in their respective hoppers is fed to the Raw Mill for fine grinding. The hot gases coming from the clinkerisation section are used in the raw mill for drying and transport of the ground raw meal to the electrostatic precipitator / bag house, where it is collected and then stored and homogenised in the concrete silo. Raw meal extracted from the silo (also called Kiln feed) is fed to the top of the preheater for pyroprocessing.

5. Clinkerisation

Cement clinker is made by pyroprocessing of kiln feed in the preheater and the rotary kiln. Fine coal is fired as fuel to provide the necessary heat in the kiln and the precalciner branched at the bottom of the preheater. Hot clinker discharged from the kiln drops on the grate cooler and gets cooled. The cooler discharges the clinker onto the pan/bucket conveyor and it is then transported to the clinker stockpiles/ silos. The clinker is taken from the stockpile/ silo to the ball mill hoppers for cement grinding.

6. Cement grinding and storage

Clinker and gypsum (for Ordinary Portland Cement) and also Pozzolana (for Portland Pozzolana Cement) are extracted from their respective hoppers and fed to the cement mills. These mills grind the feed to a fine powder and the mill discharge is fed to an elevator, which takes the material to a separator, which separates fine product and the

coarse. The latter is sent to the mill inlet for regrinding and the fine product is stored in concrete silos.

7. Packing

Cement extracted from silos is conveyed to the automatic electronic packers where it is packed in bags and dispatched in trucks.

Location

Our plant is located at Village Jhalo ka Gara, Taluka Garhi Dist. Banswara, Rajasthan and our registered office is located at No. 8, 2nd Floor, Kamanwala Chambers, Opp Bombay Stores, Sir P M Road, Fort, Mumbai – 400 001.

Note: This map is not to scale and is only an approximate indication of the location of our Plant, which is our key area of operation.

Plant and Machinery

The details of the plant and machinery that is available at our factory site is as under:

Sl. Name of the Machinery Make / Supplier Number of Units/ No. Capacity 1 Raw Mill F L Smidth 250 TPH 2 Coal Mill F L Smidth 40 TPH 3 Kiln F L Smidth 3,000 TPD 4 Cement Mill F L Smidth 2X125 TPH 5 Staker and Reclaimer F L Smidth 450 TPH 6 Crusher F L Smidth 500 TPH 7 Packing Plant EEL India Limited 3X90 TPH

Raw Materials

The principal raw materials for cement production are limestone, Amphibolite, Laterite, Red Ocher, Yellow Ocher, fly ash and gypsum.

We procure our raw materials from the following locations:

Material Requirement Source Locality (Ton per annum) Limestone 16.8 Lakh Captive Parthipura Amphibolite Depending on Captive Parthipura quality of limestone Laterite 50,000 Sunrise Minerals, Choti Sadri, Chittorgarh S R Minerals Choti Sadri, Chittorgarh Red Ocher 50,000 Sunrise Minerals Sawa, Chittorgarh S R Minerals Ishwal, Udaipur Ganapati Ventures Sawa, Chittorgarh Yellow Ocher 50,000 S R Minerals Sawa, Chittorgarh Sunrise Minerals Ishwal, Udaipur Gypsum 109,000 Rajasthan State Mines Nagur, Bikaner and Minerals Fly ash 3,30,000 Purchase Wanakbori, Gujarat Coal 1,65,000 Purchase Imported

Limestone and Amphibolite

Limestone is sourced from our Mine located at Jhalo ka Gara, Banswara, Rajasthan. The mining lease is for 65.82 hectares of land, for a period of 20 years starting from the date of execution of the mining lease, i.e. May 23, 1993, and is renewable thereafter. According to the report submitted by Holtec Consulting Private Limited (“Holtec”), the Mine has limestone reserves of approx. 38 MT of limestone. The per annum requirement of limestone for our Plant would be 1.65 MTPA, thus having a life of approx. 23 years. The transportation of limestone along with amphibolites, which is of comparatively very less quantum, will be carried to the crusher, located between the mines and plant area, by dump trucks.

The Company has also taken steps to augment reserves of limestone and has applied for fresh mining leases.

Gypsum

The total gypsum requirement for the Plant is met by procuring it from Rajasthan State Mines and Minerals Limited. It is transported from Dhankoriya, Nagaur by trucks. The gypsum received is 65% to 70% pure.

Laterite, Red Ocher and Yellow Ocher

These products are mixed with limestone in required quantities to increase the proportion of iron/aluminium. Required quantities are available from our Mine.

Fly Ash

Fly Ash is sourced from Wankbori in Gujarat, which is the nearest source for Fly Ash, located at about 175 km from the Plant.

Coal

Imported coal is being used to meet the fuel requirements of the plant. We currently require about 0.165 MTPA of coal for the operations of our Plant. The coal is currently being offloaded from Mundra or Navlakhi ports in Gujarat, from where it is transported through trucks.

Power and Fuel

Power and Fuel constitute a significant portion of the expenses incurred for manufacture of cement. We have obtained necessary approvals from Rajasthan State Electricity Board for 23 MVA (approx 20.7 MW) of power, which shall suffice our entire requirement of power for the cement plant. We are in the process of implementing a 20 MW thermal based power generation plant as part of the Plant to secure its power requirements. It is proposed that coal required for the project would be met through imported coal.

Water

The requirement of water at our Plant is 2200 m3/day. We have permission to withdraw upto 2,800 m3/day from 15 borewells at our Plant.

Manpower

As on January 31, 2011, our Company had 206 permanent employees. These employees may be segregated as follows:

No. of employees Manager grade 156 Non-Manager grade 50

Approach to Marketing and Marketing Set-Up

Our Company proposes to distribute its products primarily in the states which are in proximity to the Plant, being Rajasthan, Madhya Pradesh and Gujarat.

Our Company does not have a significant track record in the cement business and may gradually develop its own marketing channels, including a dealership network for the distribution of the products manufactured by us. However, our Company has entered into an agreement dated July 14, 2010 with our ultimate promoter, The India Cements Limited (“Marketing Agreement”) whereby our Company shall manufacture cement under the brand name ‘COROMANDEL” which is owned by India Cements. Our Company may also utilize the dealer network of ICL to market its products. In lieu, our Company shall pay Rs. 100 per MT as charges towards usage of the

brand and dealer network of India Cements. The Marketing Agreement is valid till March 31, 2013. Our Company may consider renewal of the Marketing Agreement post its expiry, upon mutual consent with India Cements, in case it is considered beneficial to our business activities.

Competition

Our targeted markets for distribution of cement are Rajasthan, Gujarat and Madhya Pradesh. Our primary competitors are large cement companies, with whom we compete for the sale of cement manufactured by us. The market share of the top players is as provided below:

For further details, please refer to the section titled “Cement Industry” on page 45 of the Draft Letter of Offer.

Collaborations/Tie-up/Association/Other agreements

Except the Marketing Agreement with India Cements, we do not have any other collaborations or tie-ups.

Future Prospects

Capacity and Capacity Utilization

The proposed installed capacity and capacity utilisation is as under:

Year Installed Capacity Proposed Utilisation %age 2011-12 1.5 MTPA 1.35 MTPA 90% 2012-13 1.5 MTPA 1.35 MTPA 90% 2013-14 1.5 MTPA 1.35 MTPA 90% Subject to demand availability

The capacity utilization projected above are higher than the capacity utilization achieved from our Plant in its first few months of operations. However, commercial production of cement has only commenced in January, 2011, and we are reasonably confident that our Company shall be able to increase the utilization to the projected levels.

Intellectual Property

We do not own any intellectual property and the cement manufactured by us is marketed under the brand name ‘Coromandel’, which is owned by India Cements and registered under the Trade and Merchandise Marks Act, 1958.

Insurance

We maintain insurance for standard fire and special perils policy, which provides insurance cover against loss or damage by fire, explosion, riot and strikes, terrorism, burglary, theft and robbery, which we believe is in accordance with customary industry practices.

The list of insurance policies held by the Company as on date of the Draft Letter of Offer are as follows:

Type of Details of Policy No. Sum Premium Period Insurance policy assets covered Insured (Rs. Per From To Company (Rs. annum) Crore) Standard All plant and 011000/11/10/11/ 460.00 24,39,594 02/11/2010 01/11/2011 United Fire and machinery 00000335 India Special items, Insurance Perils specifically – Co. Ltd. Policy Limestone crusher upto clinkerisation, 1st Cement Mill, Cement Silo 1, Packers (2 nos.) and Fly Ash Silo

Standard Stock of coal, 011000 14.00 89,118 11/08/2010 10/08/2011 United Fire and packing /11/10/12/ India Special materials, oil, 00000224 Insurance Perils stores and Co. Ltd. Policy spares

Marine Movement of 500600 /21/10/ 10.00 11,031 17/09/2010 16/09/2011 National Cargo motors, 4200000137 Insurance Policy equipment, etc. Co. Ltd. to anywhere in India

Storage 1X20 MW 090601 78.05 13,57,059 31/08/2010 30/03/2012 United cum Thermal Power /44/10/08/ India Erection Plant 50000003 Insurance Insurance Co. Ltd.

Property

The brief details of the properties owned/leased by our Company are set out below

Leasehold Properties:

Sr.No. Details of the Agreement Description of Validity Rent Usage property 1 Lease Deed entered between Land measuring 9.20 99 years Rs. 2,18,500/- as Cement M/s Mahi Cement (Division of Hectares situated at a cost of land Plant Trinetra Cement Ltd) and Nokhala village, allotment and Governor of the State of Banswara Thahasil, yearly Rent of Rajasthan on 02/02/1996 Banswara District, Rs. 1,725/- State of Rajasthan 2 Lease Deed entered between Land measuring 99 years Rs. 9,82,028/- as Cement M/s Mahi Cement Ltd and 1) 29.03 Hectares a cost of land Plant Governor of the State of situated at Jhaloka allotment and Rajasthan on 07/04/1993 and Gadha village, Garhi yearly Rent of a Supplementary Deed dated Thahasil, State of Rs. 6,788/- 02/02/1996 amending the Rajasthan. lessee’s name from Mahi 2) 6.99 Hectors Cement Ltd to Mahi Cement situated at Nokhala (Division of Trinetra Cement village, Banswara Ltd) Thahasil, State of Rajasthan. 3 Mining Lease Deed entered Land measuring 65.82 20 years Rs.2,000 as Mining of between M/s Mahi Cement Hectares situated at security. Mineral Limited and the Governor of near Parthipura 1st year – Nil lime Stone Rajasthan on 23/05/1996 and Village, 2nd to 5th year – a Supplementary Deed dated Garhi Thahasil, 1,974.60/- 22/09/1999 amending the Banswara District, 6th to 10 year - lessee’s name from Mahi State of Rajasthan Rs3,949.20/- Cement Ltd to Mahi Cement 11th & above – (Division of Trinetra Cement Rs. 5923.80/- Ltd.) Freehold Property:

Sr.No. Details of the Agreement Description of property Usage 1 Government Notification No. Land measuring 20.81 Hectares situated at Jhaloka Cement P 4(67) IND/1/91 dated May Gadha village, Garhi Thahasil, Banswara District, State Plant 26, 1993, Order no. 2431-32 of Rajasthan dated October 15, 1994 and Goverment Order no. P 4(67) IND/1/91 dated January 16, 1996.

The abovementioned properties have been mortgaged with Axis Trustee Services Limited, acting as security trustee for the secured loan obtained from Yes Bank Limited, Axis Bank Limited, UCO Bank and Infrastructure Development Finance Company Limited, amounting to Rs. 300 Cr. For further details, please refer to the section “Financial Indebtedness” on page 153 of the Draft Letter of Offer.

KEY INDUSTRY REGULATIONS AND POLICIES

Our Company, in its business of cement manufacturing in India, is governed by various legislations as applicable to it. Some of the key regulations applicable to us are summarised hereunder:

Indian Regulations

Ministry of Commerce and Industry

The Ministry of Commerce and Industry, GoI, oversees the activities of the cement industry through the Department of Industrial Development.

Licensing Policy

Under the New Industrial Policy dated July 24, 1991, all industrial undertakings are exempt from licensing except for certain industries such as distillation and brewing of alcoholic drinks, cigars and cigarettes of tobacco and manufactured tobacco substitutes, all types of electronic aerospace and defence equipment, industrial explosives including detonating fuses, safety fuses, gun powder, nitrocellulose and matches and hazardous chemicals and those reserved for the small scale sector. An industrial undertaking which is exempt from licensing is required to file an Industrial Entrepreneurs Memorandum (“IEM”) with the Secretariat for Industrial Assistance, Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, GoI, and no further approvals are required.

Cement has been exempted from industrial licensing pursuant to Notification Number 477(E) dated July 25, 1991 issued under the Industries (Development and Regulation) Act, 1951. Consequently, the Company does not require an industrial license.

FDI in Cement Sector

Foreign investment in Indian securities is regulated through the industrial policy of GoI and FEMA. While the industrial policy prescribes the limits and the conditions subject to which foreign investment can be made in different sectors of the Indian economy, FEMA regulates the precise manner in which such investment may be made. Under the industrial policy, unless specifically restricted, foreign investment is freely permitted in all sectors of Indian economy up to any extent and without any prior approvals, but the foreign investor is required to follow certain prescribed procedures for making such investment. The government bodies responsible for granting foreign investment approvals are the FIPB and the RBI.

At present, investments in companies manufacturing cement fall under the automatic approval route for FDI/NRI investment up to 100%.

Laws and Regulations relating to the Cement Industry

The applicable cement laws and regulations include the following:

 Cement Control (Amendment) Order, 1989 Pursuant to Notification No.1-5/89-Cem, dated March 1, 1989 (S.O. No. 168(E)), the Cement Control Order, 1967 (the “1967 Order”) was amended, resulting in removal of the Government’s control over price and distribution of cement. The amended 1967 Order, also known as the Cement Control (Amendment) Order, 1989, provides for maintenance of books relating to production, removal, sale and transfer of cement (excluding white cement) by the producer and furnishing of returns or such other information as may be specified by the Central Government. The Cement Control (Amendment) Order,1989 also provides for the maintenance of a Cement Regulation Account by the Development Commissioner for the cement industry. The amount credited in this account is to be used, inter alia, for reimbursing the producer towards equalizing freight or concession in the matter of export price.

 Cement Cess Rules, 1993 The Cement Cess Rules, 1993, impose a cess on the manufacture of cement. The Cement Cess Rules provide for monthly returns to be filed by the producer with the appropriate authority and the amount due every month to be deposited by the 15th of the subsequent month. The proceeds of the cess are to be utilized for research and development in cement manufacturing and persons engaged in cement industry.

 Cement (Quality Control) Order, 2003 The Cement (Quality Control) Order, 2003, has been framed under the Bureau of Indian Standards Act, 1986, as amended, and prohibits sale, manufacture and distribution of cement which does not meet the quality requirements specified by the Bureau of Indian Standards or does not bear the standard mark, and requires a manufacturer of cement to make an application to the Bureau of Indian Standards for obtaining a license for use of the standard mark.

Mining Laws and Regulations

The Central Government has the power to regulate mines and mineral development under Entry 54 of List-I of the Seventh Schedule to the Constitution of India to the extent to which such regulation and development is declared by the Parliament by law to be expedient in the public interest. The State Governments have been given powers under Entry-23 of List-II to regulate mines and mineral development subject to the Union’s power under Entry 54 of List-I.

The mining laws and regulations that are applicable to our Company include the following:-

 Mines and Minerals (Development and Regulation) Act, 1957 (the “MMDR Act”) and the Mineral Concession Rules, 1960; -

Mines and Minerals (Development and Regulation) Act, 1957 came into force with an Objective to provide for the regulation of mines and the development of minerals under the control of the Union Government:

 Rajasthan Minor Minerals Concession Rules, 1986:-

Rajasthan Minor Mineral Concession Rules, 1986 has come in exercise of the powers conferred by section 15 of the Mines and Minerals (Development & Regulation) Act. 1957, (Central Act 67 of 1957), the Rajasthan Minor Minerals Concession Rules, 1986 set out the rules and regulations with regard to the grant of quarry licences, mining leases and other mineral concessions in respect of minor mineral.

 Limestone and Dolomite Mines Labour Welfare Fund Act, 1972 and Limestone and Dolomite Mines Labour Welfare Fund Rules, 1973:-

Limestone and Dolomite Mines Labour Welfare Fund Act, 1972 came into force with a object to provide for the levy and collection of a cess on limestone and dolomite for the financing of activities to promote the welfare of persons employed in the limestone and dolomite mines.

 The Mines Act, 1952 and Mines Rules, 1955;

The Mines Act, 1952 came into force with an object to amend and consolidate the law relating to the Regulation of Labour and safety in mines.

 The Payment of Wages (Mines) Rules, 1956; and

 Metalliferous Mine Regulations, 1961.

Description of the Principal Mining Regulations

 The grant and renewal of a mining lease is governed by the provisions of the MMDR Act and the Mineral Rules.  The MMDR Act prohibits any person from undertaking any mining operations without obtaining a mining lease. The Mineral Rules require that mining leases in respect of limestone should be obtained from the State Government. The State Government also has jurisdiction to renew a mining lease.  Mining rights are subject to compliance with certain terms and conditions specified under the Mineral Rules. The Central Government and the State Governments have the power to take actions with respect to mining rights, including the imposition of fines or

restrictions, the revocation of the mining rights or implementation of a change in the amount of royalty payable.

Grant of Lease

 Under the MMDR Act, a mining lease is granted for a minimum period of twenty years and a maximum period of thirty years. The term of the mining leases granted to our Company by the State Government of Rajasthan is 20 years.

 On receipt of an application for grant of a mining lease, the State Government takes a decision to grant the precise area for the mining lease and communicates the same to the applicant. The maximum area which may be granted under a lease is ten square kilometres in one or more mining leases. The Central Government may, however, relax this restriction in the interest of development of the mineral.

 The Mineral Rules mandate that within six months of the said communication from the State Government, or such other extended period as may be permitted by the State Government, a five year mining plan has to be submitted for approval by the Central Government. The mining plan lays down the detailed procedure for conducting the mining operations. The mining plan approved by the Central Government is submitted to the State Government for grant of the mining lease over the specified area. In case of cement grade limestone, the mining plan is approved by the Indian Bureau of Mines, Ministry of Mines, GoI.

 Under the Mineral Rules, during the term of the mining lease, the lessee is required to pay royalty or dead rent, whichever is higher, to the State Government. Under the Second Schedule of the MMDR Act, the current rate of royalty applicable to a limestone lease is Rs.*•+ per tonne. Under the Third Schedule, the current rate of dead rent is Rs.*•+ per hectare per annum for the first two years and Rs.*•+ per hectare per annum for each subsequent year.

Renewal of Lease

 Under the Mineral Rules: a. an application for renewal of mining lease has to be made to the State Government. Before the grant of approval for second or subsequent renewal of a mining lease, the State Government seeks a report from the Controller General of Indian Bureau of Mines in respect of whether the grant of renewal will be in the interest of the development of the mineral. If a report is not received from the Controller General of Indian Bureau of Mines within three months of receipt of communication from the State Government, it would be deemed that the Indian Bureau of Mines does not have an adverse report regarding the grant of renewal of the mining lease. b. a person is required to apply for renewal of the mining lease at least twelve months prior to the date of expiry of the subsisting mining lease. Any delay in filing an application for renewal can be condoned by the State Government on merits provided that the application is made prior to the date of expiry of the subsisting mining lease.

c. an application for renewal of the mining lease in time authorizes a person to continue mining operations beyond the date of expiry of the subsisting mining lease until the State Government decides on the application for renewal. If an application for renewal is made in time, the period of that lease is deemed to have been extended by a further period until the State Government passes orders thereon. d. a person seeking renewal of the mining lease for a mineral which is used in such person’s own industry is entitled for renewal of the lease for a period not exceeding twenty years.  Pursuant to the Supreme Court judgment in M.C. Mehta v. Union of India (AIR 2004 SC 4016), environmental clearance from the MoEF, GoI is also required at the time of renewal of a mining lease if the area under the lease is in excess of 5 hectares and the mining lease is in respect of a major mineral.

Determination of Lease

 A notice of 12 months must be given to the State Government before determination of the lease by the lessee.  In case of closure of the mine by the lessee, a final mine closure plan must be approved by the Regional Controller of Mines and a certificate that the conditions of the mine closure plan have been complied with must be obtained from the Regional Controller of Mines.  A partial surrender of rights for mining certain minerals is permitted in certain conditions and a notice of six months must be given prior to surrender of the rights.

Transfer of Lease

 Under the Mineral Rules, the prior consent of the State Government in writing is required for transfer of a mining lease. Further, the transferee must accept all the conditions and liabilities to which the transferor was subject in respect of such lease.

Environmental and Labour Laws and Regulations

The environmental and labour laws and regulations that are applicable to our Company include the following:

 Contract Labour (Regulation and Abolition) Act, 1970;

The Act applies to every establishment in which 20 or more workmen are employed or were employed on any day on the preceding 12 months as contract labour. The Act provides for the welfare of the contract labour, their wages, appointment of the inspecting staff and maintenance of registers, records, etc. As per the said Act, the establishments covered are required to be registered as the principal employer.

 Factories Act, 1948;

The Factories Act, 1948 (“the Act”) seeks to regulate labour employed in factories and makes provisions for the safety, health and welfare of the workers. Section 2(m) of the

Act, defines a ‘factory’ to cover any premises which employs 10 or more workers and in which manufacturing process is carried on with the aid of power and any premises where there are at least twenty workers even though there is or no electrically aided manufacturing process being carried on. Each State Government has set out rules in respect of the prior submission of plans and their approval for the establishment, registration and licensing of factories. The Act provides that the occupier of a factory i.e. the person who has ultimate control over the affairs of the factory and in the case of a company, any one of the directors, must ensure the health, safety and welfare of all workers especially in respect of safety and proper maintenance of the factory such that it does not pose health risks, the safe use, handling, storage and transport of factory articles and substances, provision of adequate instruction, training and supervision to ensure workers’ health and safety, cleanliness and safe working conditions. There is a prohibition on employing children below the age of 14 years in a factory.

 The Indian Boilers Act, 1923 and the Indian Boiler Regulations, 1950;

The Indian Boilers Act, 1923 and the Indian Boiler Regulations, 1950 came in force with a object to secure uniformity throughout India in all technical matters connected with boiler regulations e.g., standards of construction, maximum pressure, and to insist on the registration and regular inspection of all boilers throughout India.

 Explosives Act, 1884;

The Explosive Act was introduced to regulate the manufacture, possession, use, sale, transport and importation of explosives.

 Employees’ State Insurance Act, 1948;

The Employee State Insurance Act, 1948 (“ESIA”) aims to provide benefits for employees or their beneficiaries in case of sickness, maternity, disablement and employment injury and to make provision for the same. It applies to, inter alia, seasonal power using factories employing ten or more persons and non-power using factories employing 20 or more persons. Every factory or establishment to which the ESIA applies is required to be registered in the manner prescribed in the ESIA. In respect of such employees, both the employer and the employee must make certain contributions to the Employee State Insurance Corporation.

 Employees’ Provident Funds and Miscellaneous Provisions Act, 1952;

Employees Provident Funds and Miscellaneous Provisions Act, 1952 (“EPFA”) was introduced with the object to institute provident fund for the benefit of employees in factories and other establishments. It provides for the institution of provident funds and pension funds for employees in establishments, which employ more than 20 persons,

and factories specified in Schedule I of the EPFA. Under the EPFA, the Central Government has framed the “Employees Provident Fund Scheme”, “Employees Deposit- linked Insurance Scheme” and the “Employees Family Pension Scheme”. The funds constituted under these schemes consist of contributions from both the employer and the employees, in the manner specified in the statute. The EPFA prescribes penalties for avoiding payments required to be made under the abovementioned schemes

 Workmen’s Compensation Act, 1923. The Workmen Compensation Act, 1923 (“WCA”) has been enacted with the objective to provide or the payment of compensation to workmen by employers for injuries by accident arising out of and in the course of employment, and for occupational diseases resulting in death or disablement. The WCA makes every employer liable to pay compensation in accordance with the WCA if a personal injury/disablement/loss of life is caused to a workman (including those employed through a contractor) by accident arising out of and in the course of his employment. In case the employer fails to pay compensation due under the WCA within one month from the date it falls due, the commissioner appointed under the WCA may direct the employer to pay the compensation amount along with interest and may also impose a penalty.

 Payment of Gratuity Act, 1972

The provisions of this legislation are applicable on all the establishments in which ten or more employees were employed on any day of the preceding twelve months and as notified by the government from time to time. The Act provides that within 30 days of opening of the establishment, it has to notify the controlling authority in Form A. Thereafter whenever there is any change it the name, address or in the change in the nature of the business of the establishment a notice in Form B has to be filed with authority.

 Payment of Bonus Act, 1965

The Payment of Bonus Act, 1965 is applicable on every establishment employing 20 or more employees. The said act provides for payment of the minimum bonus to the employees specified under the Act. It further requires for the maintenance of certain books and registers and submission of annual return within 30 days of payment of the bonus to the Inspector.

 Payment of Wages Act, 1936 [

The Payment of Wages Act, 1936 applies to the persons employed in the factories and to persons employed in industrial or other establishments where the monthly wages payable to such persons is less than Rs. 6500/-.

 Minimum Wages Act, 1948 [

The Minimum Wages Act, 1948 gives power to appropriate government (Central or State) to fix minimum wages to be paid to the persons employed in scheduled or non scheduled employment and the concerned employer is required to pay the minimum wages, fixed by the appropriate government.

Industrial Employment Standing Orders Act, 1946

Every establishment employing more than 50 employees is required to formulate rules and regulations for its employees and the same should be submitted for approval to the Deputy Labour Commissioner.

 The Maternity Benefits Act, 1961

The purpose of the Maternity Benefit Act is to regulate the employment of pregnant women and to ensure that they get paid leave for a specified period during and after their pregnancy. It provides, inter alias, for paid leave of 12 weeks, payment of maternity benefits and enacts prohibitions on dismissal, reduction of wages paid to pregnant women, etc.

Environment Specific Legislations

Manufacturing units must ensure compliance with environmental legislation, such as the Water (Prevention and Control of Pollution) Act 1974, the Air (Prevention and Control of Pollution) Act, 1981, and the Environment Protection Act, 1986. The basic purpose of these statutes is to control, abate and prevent pollution. In order to achieve these objectives, Pollution Control Boards (“PCBs”), which are vested with diverse powers to deal with water and air pollution, have been set up in each state. The PCBs are responsible for setting the standards for maintenance of clean air and water, directing the installation of pollution control devices in industries and undertaking inspection to ensure that industries are functioning in compliance with the standards prescribed.

Environment (Protection) Act, 1986 and Environment Protection Rules

The Central Government has been vested with powers to lay down standards for the quality of environment in its various aspects, standards for emission or discharge of environmental pollutants from various sources and to restrict areas in which operations or processes cannot be carried out or shall be carried out subject to certain safeguards. In case of offences by companies, the person who was in charge at the time of the commission of the offence shall be deemed to be guilty.

Tax Related Legislations

 Value Added Tax, 2005

Value Added Tax (VAT) is charged by laws enacted by each State on sale of goods affected in the relevant States. VAT is a multi-point levy on each of the entities in the supply chain with

the facility of set-off of input tax that is the tax paid at the stage of purchase of goods by a trader and on purchase of raw materials by a manufacturer. Only the value addition in the hands of each of the entities is subject to tax. VAT is not chargeable on the value of services which do not involve a transfer of goods. Periodical returns are required to be filed with the VAT Department of the respective States by our Company.

 Income Tax Act, 1961

Income Tax Act, 1961 is applicable to every domestic/foreign company whose income is taxable under the provisions of this Act or Rules made there under depending upon its “Residential Status” and “Type of Income” involved. U/s 139(1) every Company is required to file its Income tax Return for every Previous Year by 30th September of the Assessment Year .Other compliances like those relating to Tax Deduction at Source, Fringe Benefit Tax, Advance Tax, Minimum Alternative Tax and like are also required to be complied by every Company.

 Central Sales Tax Act, 1956

In accordance with the Central Sales Tax Act, every dealer registered under the Act shall be required to furnish a return in Form I (monthly/ quarterly/ annually) as required by the State Sale Tax laws of the assessing authority together with treasury challan or bank receipt in token of the payment of taxes due.

 Service Tax

Service tax is charged on taxable services as defined in Chapter V of Finance Act, 1994, which requires a service provider of taxable services to collect service tax from a service recipient and pay such tax to the Government. In accordance with Rule 6 of Service tax Rules, the assesses is required to pay Service tax in TR 6 challan by fifth of the month immediately following the month to which it relates. Further under Rule 7 (1) of Service Tax Rules, our Company is required to file a half yearly return in Form ST 3 by twenty fifth of the month immediately following the half year to which the return relates.

 Central Excise Act, 1944

In accordance with the Central Excise Act & Central Excise Rules, every person who produces or manufactures any excisable goods is required to get itself registered with the Jurisdictional Deputy or Assistant Commissioner of Central Excise .Hence this Act is applicable on our Company. Further the provisions of the Central Excise Rules provide that the manufacturer of final products (other than SSI’s) shall submit the duty on goods removed from the factory or warehouse during the month by the fifth day of following month. Also a Monthly Return in Form ER1 is required to be submitted to the Superintendent of Central Excise within 10 days after the close of the month.

HISTORY AND OTHER CORPORATE INFORMATION History

Our Company was incur porated on March 12, 1987 as a private limited company in the state of Maharashtra under the Companies Act, 1956 vide Registration No 42858 of 1987. The subscribers to our Memorandum of Association were Shri Rajendra Prasad Agrawal, Shri Kamal Dhulchand C. Daga and Shri Surendra Kumar Kachhara. The Corporate Identification Number (CIN) of our Company is L99999MH1987PLC042858.Our Company was converted into a public limited company and a fresh certificate of incorporation was issued by the Registrar of Companies, Mumbai on January 20, 1992 under the name and style of Indo Zinc Limited. The name of our Company was further changed from Indo Zinc Limited to Trinetra Cement Limited and consequently, a fresh certificate of incorporation was issued by the Deputy Registrar of Companies, Maharashtra on March 18, 2011.

We made our initial public Offer in 1993 and listed our equity shares on Bombay Stock Exchange Limited (‘BSE’), Ahmedabad Stock Exchange Limited (‘ASE’), Madhya Pradesh Stock Exchange Limited (‘MPSE’) and The Delhi Stock Exchange Limited (‘DSE’). Subsequently, our Equity Shares were suspended from trading at BSE with effect from May 13, 2002. BSE, vide notification dated October 29, 2010, has regularized our trading with effect from November 04, 2010 and our Equity Shares are currently trading in the ‘T’ category. Our Equity Shares currently continue to remain suspended from trading at ASE, MPSE and DSE and we propose to delist our Equity Shares from these stock exchanges after the completion of the Issue.

In 1988-89, we had set up a primary zinc plant in Pithampur, Madhya Pradesh. In 1993, we raised funds through an Initial Public Offering to partly fund the construction of an electrolytic copper refining facility at Pithampur, Madhya Pradesh. This project, however, was subsequently abandoned.

Our Company was declared a sick industrial company within the meaning of Clause (o) of subsection (1) of Section (3) of the Sick Industrial Companies (Special Provisions) Act, 1985 in the hearing held on 18/01/2000 and registered with the Board for Industrial and Financial Reconstruction ("BIFR") as Case No: 277/98. We have, since then, fully discharged our dues and

liabilities towards our lenders – Industrial Development Bank of India, Life Insurance Corporation of India and State Bank of India in the financial year ending March 31, 2008 and in view of our net-worth exceeding the accumulated losses, BIFR, vide order dated March 17, 2009 discharged our Company from the purview of the BIFR.

On July 12, 2009, our Promoter, ICLFSL, acquired 5,83,600 Equity Shares at a price of Rs. 22.50 per Equity Share and on July 19, 2009, ICLFSL entered into a Share Purchase Agreement with Sanjay Agrawal, Manoj Kumar Agrawal and other associates (‘Erstwhile Promoters’) of our Company to acquire 17,87,700 Equity Shares, representing 39.73% of the subscribed equity capital of the Company, at a price of Rs. 22.50 per Equity Share, payable in cash. In compliance with Regulations 10 and 12 of SEBI SAST Regulations, an open offer to acquire upto 9,00,000 Equity Shares was made by ICLFSL to the public shareholders of our Company. Pursuant to the open offer, 3,68,974 Equity Shares were acquired by ICLFSL, bringing its total shareholding to 27,40,274 Equity Shares, or 60.89% of the then total share capital of the Company. Our Company thus became a subsidiary of ICLFSL and India Cements. On October 9, 2009, March 25, 2010 and May 28, 2010, nominee directors of ICLFSL and ICL, along with other Independent Directors, were appointed to our Board and on October 9, 2009 and January 13, 2010, the erstwhile Promoter Directors of our Company resigned.

After the takeover over of the management and control of our Company, the abandoned cement plant at Banswara, Rajasthan was revived by our Company and the capacity was increased from 0.5 MTPA to 1.5 MTPA. The total cost of the Plant was approx. Rs. 600 Cr. The same was funded through a mix of unsecured loan obtained from India Cements and Rs. 300 Cr. availed as term loans from commercial banks and financial institutions. Manufacture of cement was commenced on a trial basis in October 2010 and commercial production has commenced in the month of January 2011.

As on the date of this Draft Letter of Offer, our Company has 4136 Equity Shareholders.

Registered Office:

The registered office of our Company is situated at No. 8, 2nd Floor, Kamanwala Chambers, Opp. Bombay Stores, Sir P.M.Road, Fort, Mumbai 400 001 and Corporate Office at ‘Coromandel Towers', 93, Santhome High Road, Karpagam Avenue, R A Puram, Chennai – 600028.

Our shareholders have consented to the shifting of our Registered Office from the state of Maharashtra to the state of Tamil Nadu through a special resolution passed through postal ballot, the results of which were declared on February 21, 2011. Accordingly, it is proposed to file an application with the Company Law Board to obtain the requisite approval for shifting of registered office.

Key Events

Year Key Events, Milestones and Achievements 1987 Incorporated as a private limited company 1988-89 Setting up of Zinc plant in Pithampur, District Dhar, Madhya Pradesh 1992 Converted into a public limited company 1992 – 93 Commenced setting up a factory at Madhya Pradesh for electrolytic copper refining 1993 – 94 Made an Initial Public Offering 1995-96 Commenced work to set up a factory at Banswara to manufacture 5 million tonnes of cement 1995-96 Amalgamation of Mahi Cement Limited with our Company 1997- 98 Our company applied to BIFR and was registered as a sick industrial company vide case No: 277/98 2008-09 Discharged from the purview of the BIFR/SICA 2009 - 10 Takeover by ICL Financial Services Limited and change in the board of Directors 2009- 10 Resumption of construction at our cement plant at Banswara 2010-11 Commencement of commercial production of cement from the Plant

Main Objects of our Company

1. To manufacture, process, mine, extract, recycle, alter, improve, refine, mix, buy, sell, import, export, and deal in zinc, copper, brass, zinc sulphate, copper sulphate, zinc chloride and other non-ferrous metals, alloys, ash, scrap, chemical compounds and minor metals.

2. To manufacture, process, fabricate, draw, roll, re-roll, buy, sell, import, export and deal in bars, rods, flats, squares, shafts, ingots, pipes, utensils, wire, wire products, nails, screws, hings, sheets, plates, expanded metals, strips, hoops, rounds, circles, angles, parts and components made of all kind of ferrous and non-ferrous metals.

Selected Other Objects of our Company

1. To produce, manufacture, refine, prepare, import, export, purchase, sell and generally to deal in all kinds of cement (ordinary white, coloured, Portland, alumina, blast, furnace, clinker, silica lime cement), cement products of any description and pipes, poles, asbestos, blocks, tiles, lime, lime stone and or by-products thereof and in connection therewith to take on lease or acquire and maintain cement factories, limestone and other quarries and collieries, workshops and other works*

*Added as per order dated 16.06.1995 passed by the Hon’ble Company Law Board, Bombay in Petition No. 176/17/CLB/WR/95

Amendments to the Memorandum of Association since Incorporation:

Year Nature of Amendment 1989 The Authorised Share Capital of our Company was increased from Rs.25,00,000 to Rs.75,00,000 comprising of 25000 Equity Shares of Rs.100 each to 75,000 Equity Shares of Rs.100 each 1992 The Authorised Share Capital of our Company was increased from Rs.75,00,000 to Rs.500,00,000 comprising of 75,000 Equity Shares of Rs.100 each to 50,00,000 Equity Shares of Rs.10 each 1995 The Authorised Share Capital of our Company was increased from Rs.5,00,00,000 to Rs.25,00,00,000 comprising of 50,00,000 Equity Shares of Rs.10 each to 250,00,000 Equity Shares of Rs.10 each 1996 The Authorised Share Capital of our Company was increased from Rs.25,00,00,000 comprising of 2,50,00,000 Equity Shares of Rs.10 each to Rs. 35,00,00,000 comprising of 2,50,00,000 Equity Shares of Rs. 10 each and 10,00,000 Preference Shares of Rs.100 each 2011 The Authorised Share Capital of our Company was increased from Rs. 35,00,00,000 comprising of 2,50,00,000 Equity Shares of Rs. 10 each and 10,00,000 Preference Shares of Rs.100 each to Rs. 350,00,00,000 comprising of 15,00,00,000 Equity Shares of Rs. 10 each and 2,00,00,000 Preference Shares of Rs. 100 each.

Change in the Registered Office

Year Changed From Changed To Reason 1993-94 12/18 V P Road, 601, Ravi Building, For administrative Mumbai 400 004 189/191, Dr. D.N. Road, Fort, convenience Mumbai 400 001 2009-10 601, Ravi Building, No. 8, 2nd Floor, For administrative 189/191, Dr. D.N. Road, Kamanwala Chambers, convenience Fort, Mumbai 400 001 Sir P.M. Road, Fort, Mumbai 400001

Our Subsidiaries

As on the date of the Draft Letter of Offer, our Company has no subsidiary.

Key Agreements

Scheme of Amalgamation – Mahi Cement Limited

As per the Scheme of Amalgamation approved by the Hon’ble High Court of Bombay vide order dated September 07, 1995, Mahi Cement Limited has been amalgamated into our Company. The appointed date for the same was November 30, 1994, from which date all the movable, immovable and other properties of whatsoever nature and description of Mahi Cement Limited

were transferred or deemed to have been transferred to our Company. In lieu of the same, 3,84,000 Equity Shares of the Company, in the ratio of 1 Equity Share for every 5 equity shares of Rs. 10 each of Mahi Cement Limited, were allotted to the shareholders of Mahi Cement Limited.

Share Purchase Agreement between erstwhile promoters and ICLFSL

Our Promoter, ICLFSL, entered into a Share Purchase Agreement dated July 19, 2009 with Mr. Sanjay Agrawal and associates (‘Erstwhile Promoters’) to acquire 17,87,700 Equity Shares from the Erstwhile Promoters, representing 39.83% of the paid-up equity capital of our Company, at a price of Rs. 22.50 per Equity Share. The total consideration payable was Rs. 4,02,23,250.

Marketing Agreement

Our Company has entered into an agreement dated July 14, 2010 with The India Cements Limited (“Marketing Agreement”) whereby our Company shall manufacture cement under the brand name ‘COROMANDEL” which is owned by India Cements. Our Company may also utilize the dealer network of India Cements to market its products. In lieu, our Company will pay Rs. 100 per MT as charges towards usage of the brand and dealer network of India Cements. The Marketing Agreement is valid till March 31, 2013.

Strategic Partners

Our Company does not have any Strategic Partner as on the date of filing of this Draft Letter of Offer.

Financial Partners

Our Company does not have any financial partners as on the date of filing of this Draft Letter of Offer.

OUR MANAGEMENT Board of Directors

Our Company is currently managed by a Board of Directors comprising eleven (11) Directors. As per our Articles of Association, our Board shall consist of not less than three (3) Directors and not more than eleven (11) Directors.

As on date of filing this Draft Letter of Offer with SEBI, we have eleven (11) Directors. Details of our Directors are given below:

Sl. Name, Father's name, Age Date of Other Directorships / Partnership No. Designation, Address, Appointment as Qualification, Occupation, Director and Nationality, & DIN term of appointment 1 Shri N. Srinivasan, 66 09.10.2009 1. Andhra Pradesh Gas Power S/o : Shri T.S. Narayanaswami, Corporation Limited Liable to 2. Anna Investments Private Non-Executive Chairman, retirement by Limited Non-Independent rotation 3. Biosynth Life Sciences India Limited Address: 6, Arch Bishop 4. Coromandel Electric Company Mathias Avenue, Limited Chennai 600028 5. Coromandel Sugars Limited 6. E W Stevens & Co Private Limited Qualification: B.Sc (Tech.), 7. EWS Finance & Investments Madras University Private Limited M.S., Illinois Institute of 8. ICL Financial Services Limited Technology, Chicago 9. ICL International Limited 10. ICL Securities Limited Occupation: Industrialist 11. ICL Shipping Limited 12. India Cements Capital Limited Nationality: Indian 13. M M Forgings Limited 14. Prince Holdings (Madras) Private DIN: 00116726 Limited 15. Raasi Cement Limited 16. Rupa Holdings Private Limited 17. Thambi Investments Private Limited 18. The India Cements Limited 19. Trishul Concrete Products Limited 20. Unique Receivable Management Private Limited 2 Dr. B.S. Adityan, 74 25.03.2010 1. Educational Trustee Co. (P) Limited S/o : Shri S.B. Adityan, Liable to 2. Gay Travels Private Limited

retirement by 3. India Cabs (P) Limited Independent, Non-Executive rotation 4. India Cements Capital Limited Director 5. MIOT Hospitals Limited 6. Nellai Murasu (P) Limited Qualification: B.A. 7. Sivanthi Farms (P) Limited 8. Subasri Realty Private Limited Address: No. 7 , Poes Garden, 9. Sun Paper Mill Limited Chennai - 600086 10. The India Cements Limited 11. Unique Receivable Management Occupation: Industrialist Private Limited

Nationality: Indian

DIN: 00037717 3 Shri Arun Datta 63 25.03.2010 1. The India Cements Limited S/o: Shri Amiya Kumar Datta Liable to Independent, Non-Executive retirement by Director rotation

Qualification: B.E. (Mechanical Engineering) & PG Diploma in Marketing Management

Address: 74 Aspen Green, Nirvana Country, South City, Gurgaon 122003.

Occupation: Consultant Nationality: Indian

DIN: 00180069 4 Shri R.K. Das 77 25.03.2010 1. Coromandel Sugars Limited S/o: Shri V Krishna Menon 2. ICL Financial Services Limited Liable to 3. ICL International Limited Independent, Non-Executive retirement by 4. ICL Securities Limited Director rotation 5. ICL Shipping Limited Qualification: B.E.(Mechanical) 6. Industrial Chemicals & Address: “Dhanya” Puthur, Monomers Limited 5/213, Palakkad 678001 7. Raasi Cement Limited 8. The India Cements Limited Occupation: President (Operations), Retd., The India Cements Limited

Nationality: Indian

DIN: 00327985

5 Shri N.R. Krishnan 72 25.03.2010 1. Cognizant Foundation 2. Ponni Sugars (Erode) Limited S/o: Shri N.R. Raghunathachari Liable to 3. Tamil Nadu Petroproducts retirement by Limited Independent, Non-Executive rotation 4. Tamil Nadu Road Development Director Company Limited 5. The India Cements Limited Qualification: B.Sc.(Hons.) Chemistry, M.Sc. Chemistry

Address: Old No. 18, New No. 46, 2nd Floor, Balaji Nagar 2nd Street, Royapettah, Chennai – 600014

Occupation: Indian Administrative Service (Retd.) Nationality: Indian

DIN: 00047799 6 Shri A. Sankarakrishnan 68 25.03.2010 1. Allsec Technologies Limited 2. India Cements Capital Limited S/o: Shri S. Annaswami Liable to 3. India Cements Investment retirement by Services Limited Independent, Non-Executive rotation 4. Kone Elevator India Private Director Limited 5. The India Cements Limited Qualification: B .E. Mechanical

Address: New No. 82, Old No. 195, St.Mary’s Road, Chennai - 600018

Occupation: Industrialist Nationality: Indian

DIN: 00054462 7 Shri L. Sabaretnam 70 28.05.2010 1. Biosynth Life Sciences India S/o: Shri S. Lakshmanan Limited Liable to 2. Chennai Petroleum Corporation Independent, Non-Executive retirement by Limited Director rotation 3. Oriental Solutions Private Limited Qualification: M B A Marketing 4. Pacific Data Labs Private Limited 5. Coromandel Sugars Limited Address: New No. 2, Old No. 74, Appar Street, Kalakshetra Colony, Besant Nagar,

Chennai – 600090

Occupation: Advisor Nationality: Indian

DIN:00276882 8 Shri T.S. Raghupathy 59 09.10.2009 1. Biosynth Life Sciences India S/o: Shri T.S. Subramaniam Limited Liable to 2. Coromandel Infotech India Non-Independent, Non- retirement by Limited Executive Director rotation 3. Coromandel Sugars Limited 4. ICL Financial Services Limited Qualification: B.Com., 5. ICL International Limited MMSc 6. ICL Securities Limited 7. ICL Shipping Limited Address: New No. 21, Old No. 8. India Cements Capital Limited 64, 4th Street, Abiramapuram, 9. India Cements Investments Chennai 600018 Services Limited 10. Industrial Chemicals & Occupation: Executive Monomers Limited President, The India Cements 11. Raasi Cement Limited Limited 12. Sivasunder Finance & Nationality: Indian Investments Private Limited 13. Sowdambika Finance & DIN: 00207220 Investments Private Limited 14. Trishul Concrete Products Limited 15. Trishul Investments Private Limited 16. Unique Receivable Management Pvt Limited 9 Shri PL. Subramanian 65 09.10.2009 1. Coromandel Electric Company S/o: Shri AR. Palaniappan Limited Liable to Non-Independent, Non- retirement by Executive Director rotation

Qualification: B E Mechanical

Address: 1900, Thiruvalluvar Kudiyuruppu, I Block, 18th Street, Anna Nagar-W, Chennai 600040 Occupation: Sr. President (Operations),The India Cements Limited Nationality: Indian DIN: 00549992

10 Shri R. Srinivasan 54 09.10.2009 1. Coromandel Infotech India S/o: Shri S. Ranganathan Limited Liable to 2. Coromandel Travels Limited Non-Independent, Non- retirement by 3. Industrial Chemicals and Executive Director rotation Monomers Limited 4. Pulivendula Polymers Private Qualification : A.C.A Limited 5. Sivasunder Finance & Address: No. 19, 3rd Cross Investments Private Limited Street, Seethamma Colony 6. Sowdambika Finance & Extn., Chennai 600018 Investments Private Limited 7. Trishul Investments Private Occupation: Joint President Limited (Finance & Accounts), The India Cements Limited Nationality: Indian

DIN: 00207398 11 Shri V.M. Mohan 54 09.10.2009 1. Coromandel Infotech India S/o: Shri V.N. Margabandu Limited Liable to 2. Coromandel Travels Limited Non-Independent, Non- retirement by 3. Pulivendula Polymers Private Executive Director rotation Limited 4. Sivasunder Finance & Qualification: B.Com., A.C.A., Investments Private Limited A.C.S., AICWAI 5. Sowdambika Finance & Investments Private Limited Address: New No. 14, Old No. 6. Trishul Investments Private 7, I Cross Street, Mahalakshmi Limited Nagar, Adambakkam, Chennai – 600088

Occupation: Joint President (Corporate Finance), The India Cements Limited Nationality: Indian

DIN: 00921760

None of the above mentioned Directors are on the RBI List of wilful defaulters as on date.

Neither our Company nor our promoters, persons forming part of our Promoter Group, Directors or persons in control of our Company are debarred from accessing the capital market by SEBI.

None of the promoters, Directors or persons in control of our company has been or is involved as a promoter, director or person in control of any other company, which is debarred from accessing the capital market under any order or directions made by SEBI.

There are no service contracts entered into by the Directors with our Company providing for benefits or payments of any amount upon termination of employment.

BRIEF PROFILE OF OUR DIRECTORS

Shri N Srinivasan

Shri N. Srinivasan, aged 66 years, received his B.Sc. (Tech.) from Madras University and his M.S. from the University of Chicago. He is the Vice-Chairman and Managing Director of The India Cements Limited. He was the Sheriff of Madras for two terms between 1989 to 1991. Over the last two decades he has been the President of the Cement Manufacturers Association for three years (1991 to 1994), and Chairman of the Board of Governors of the National Council for Cement and Building Materials (NCBM) for two terms (1991 to 1993). He was the Chairman of the Development Council for Cement Industry (DCCI) constituted by the Government of India for two terms (1992 to 1996). Shri N. Srinivasan was also the President of the Madras Chamber of Commerce and Industry for two years (1996 to 1998). During 2000-2001 he was the President of the All India Organisation of Employers. During 2000-2004, he was also a member of the High Profile Council of Trade and Industry constituted by the Prime Minister of India. Shri N. Srinivasan was also the Senior Vice-President of the Federation of Indian Chambers of Commerce and Industry. He is also Chairman of our Shareholders’ and Investors’ Grievance Committee.

Dr. B S Adityan

Dr. B. S. Adityan, aged 74 years, received his B.A. degree from Madras University. He is the Chairman of Audit Committees of The India Cements Limited & India Cements Capital Limited. He is also a Chairman of Shareholders’/Investors’ Grievance Committee of The India Cements Limited.

Shri Arun Datta

Shri Arun Datta, aged 63 years, received his B.E. (Mechanical Engineering) from Birla Institute of Technology, Pilani and Post Graduate Diploma in Marketing Management from Bhavan Institute of Management. He is a member of the Audit Committee of The India Cements Limited.

Shri R K Das

Shri R K Das, aged 77 years, received his B.E. Mechanical degree from Madras University. He is a member of the Audit Committee of The India Cements Limited.

Shri N R Krishnan

Shri N Krishnan, aged 72 years, is a retired Indian Administrative Services officer. He is a member of our Audit Committee. He is also a member of the Audit Committees of Tamilnadu Petro Products Limited and Ponni Sugars (Erode) Limited and the Chairman of the Audit Committee of Tamil Nadu Road Development Company Limited.

Shri A Sankarakrishnan

Shri A Sankarakrishnan, aged 68 years, received his B.E. (Mechanical) degree from Anna University, Chennai. He is Chairman of our Audit Committee. He is also a member of the audit committees of Allsec Technologies Limited and India Cements Capital Limited.

Shri L Sabaretnam

Shri L Sabaretnam, aged 70 years, received his M.B.A (Marketing) from University of Madras. Earlier, he was the Chief Executive officer of Coromandel Sugars Limited.

Shri T S Raghupathy

Shri T S Raghupathy, aged 59 years, received his B.Com degree and MMSc from University of Madras. He is a member of our Audit Committee and Shareholders’/Investors’ Grievance Committee. He is also a member of the audit committee of India Cements Capital Limited. He has been with the India Cements group for the last 20 years and is currently Executive President, The India Cements Limited.

Shri PL Subramanian

Shri PL Subramanian, aged 65 years, received his B.E. (Mechanical) degree from Thiagarajar College of Engineering. He has been with the India Cements group for the last 24 years and is currently Senior President (Operations), The India Cements Limited.

Shri R Srinivasan

Shri R Srinivasan, aged 54 years, is a member of the Institute of Chartered Accountants of India. He has been with the India Cements group for the last 13 years and is currently Joint President (Finance and Accounts), The India Cements Limited.

Shri V M Mohan

Shri V M Mohan, aged 54 years, is a commerce graduate and is a member of the Institute of Chartered Accountants of India, Institute of Company Secretaries of India and Institute of Cost & Works Accountants of India. He has been with the India Cements group for the last 29 years and is currently Joint President (Corporate Finance), The India Cements Limited.

Relationship between the Directors

None of the Directors of the Company have any family relationship amongst themselves.

Arrangements with major shareholders, customers, suppliers or others

Except the Share Purchase Agreement with the Erstwhile Promoters, there is no arrangement or understanding with major shareholders, customers, suppliers or others, pursuant to which any Director was appointed as a Director or member of senior management of the Company.

Terms of Appointment of the Chairman and the Executive Directors

Chairman: Mr. N Srinivasan

Mr. N Srinivasan has been appointed as an Additional Director of the Company on October 09, 2009 and his appointment was approved by shareholders at the AGM of the Company held on September 30, 2010, as non executive Director subject to retirement by rotation. He does not receive any salary or perquisites or commission for this post.

Our Company does not have any Executive Directors.

Compensation of Directors

Our non-executive directors do not receive any remuneration, either in the form of commission or sitting fees. Since there are no whole-time Directors, Our Company has not constituted a Remuneration Committee.

Shareholding of Directors

As per our Articles, our Directors are not required to hold any Equity Shares in our Company. Our Directors do not hold any Equity Shares in our Company as on the date of filing of this Draft Letter of Offer.

Borrowing Powers of Directors

The shareholders of the Company have, in the meeting held on September 30, 2010, have accorded their consent to the Board of Directors under Section 293(1)(d) of the Companies Act to borrow any amount, together with the amount already borrowed by the Company (apart from temporary loans obtained from the Company’s bankers in the ordinary course of business) to the extent of Rs. 1,000 Cr. over and above the paid-up capital and free reserves of the Company for the time being.

Policy on Disclosure and internal procedure for prevention of Insider Trading

Shri S Sridharan, Company Secretary and Compliance Officer, is responsible for monitoring and adherence to the rules, policies and procedures for the preservation of price sensitive

information and the implementation of the code of conduct under the overall supervision of the Board.

Interest of Directors

All of our Directors may be deemed to be interested to the extent of fees payable to them for attending meetings of the Board (currently NIL), commission payable to our Non-executive Directors and reimbursement of expenses payable to them under our Articles of Association or paid in future. All our Directors may also be deemed to be interested to the extent of Equity Shares, if any, already held by them or their relatives or bodies corporate in which they have interest in our Company, or Equity Shares that may be subscribed for and allotted to them, out of the present Issue in terms of this Draft Letter of Offer and also to the extent of any dividend payable to them and other distributions in respect of the said Equity Shares.

Further, save and except as stated otherwise in the chapters titled ‘Our Business’ and ‘Our Promoter and Promoter Group’ and the section titled ‘Financial Statements’ beginning on page nos. 51, 90 and 95, respectively, of this Draft Letter of Offer, our Directors do not have any other interests in our Company as on the date of filing of this Draft Letter of Offer with SEBI.

Our Directors are not interested in the appointment of or acting as Registrar or Bankers to the Issue or any such intermediaries registered with SEBI.

Changes in our directors in the last 3 years

The following are the changes in our Board of Directors during the last three years:

Name of Director Date of Change Nature of Change Shri Manoj Agrawal 09.10.2009 Resignation Shri B.L. Kakrecha 09.10.2009 Resignation Col. Nitin Bhatnagar 09.10.2009 Resignation Shri Ritesh Lunkad 09.10.2009 Resignation Shri N. Srinivasan 09.10.2009 Appointment Shri T.S. Raghupathy 09.10.2009 Appointment Shri PL. Subramanian 09.10.2009 Appointment Shri R. Srinivasan 09.10.2009 Appointment Shri V.M. Mohan 09.10.2009 Appointment Shri Sanjay Agrawal 13.01.2010 Resignation Shri Surendra Kumar Nuwal 13.01.2010 Resignation Dr. B.S. Adityan 25.03.2010 Appointment Shri Arun Datta 25.03.2010 Appointment Shri R.K. Das 25.03.2010 Appointment Shri N.R. Krishnan 25.03.2010 Appointment Shri A. Sankarakrishnan 25.03.2010 Appointment Shri L. Sabaretnam 28.05.2010 Appointment

Corporate Governance

Our Company has complied with the requirements of corporate governance contained in Clause 49 of the Listing Agreement, especially with respect to broad basing of Board, constituting the Committees such as Shareholders / Investors Grievance Committee, adoption of Code of Conduct for members of our Board and the employees in the grade of Manager and above.

Board of Directors

The details of the Board of Directors of the Company, Meetings held and attendance of the Directors are given below for the period from April 01, 2010 to February 10, 2011:

Name of Directors Committees of other companies Membership Chairmanship Shri N Srinivasan 3 1 Dr B S Adityan - 3 Shri Arun Datta 1 - Shri R K Das 1 - Shri N R Krishnan 2 1 Shri A Sankarakrishnan 2 - Shri L Sabaretnam - - Shri T S Raghupathy 1 - Shri PL Subramanian - - Shri R Srinivasan - - Shri V M Mohan - -

As required by the Companies Act, 1956 and Clause 49 of the listing Agreement, none of the Directors hold directorship in more than 15 public companies or hold memberships in more than 10 Board Committees or Chairmanships in more than 5 Board Committees across all companies in which they hold directorships.

Board Meetings

The meetings of the Board of Directors are scheduled well in Advance and the agenda papers are circulated well in advance to all the members of the Board. The total number of meetings held from April 01, 2010 to February 10, 2011 is 6 i.e. on 14.04.2010, 28.05.2010, 13.08.2010, 12.11.2010, 31.12.2010 and 10.02.2011. The attendance of Directors is as under:

Name of Director No. of Board No. of Board meetings held Meetings attended Shri N Srinivasan 6 5 Dr B S Adityan 6 1

Shri Arun Datta 6 3 Shri R K Das 6 3 Shri N R Krishnan 6 6 Shri A Sankarakrishnan 6 6 Shri L Sabaretnam* 4 1 Shri T S Raghupathy 6 5 Shri PL Subramanian 6 4 Shri R Srinivasan 6 5 Shri V M Mohan 6 6

* Mr. L Sabaretnam was appointed as an Additional Director on the Board of our Company on May 28, 2010.

Code of Conduct: The Board of Directors has adopted a code of conduct for the Board towards our Company.

Committees of the Board

Audit Committee

The Audit Committee has been reconstituted on March 25, 2010. The composition of the Audit Committee and the attendance of the members at the meetings for the period April 01, 2010 to February 10, 2011, are as follows:

Name of Member No of Meetings No of Meetings held attended Mr. A.Sankarakrishnan, Chairman 4 4 Mr. N.R.Krishnan 4 4 Mr. T.S.Raghupathy 4 4

The Company Secretary is also Secretary to the Audit Committee.

The role and terms of reference of the Audit Committee cover the areas mentioned under clause 49 of the Listing Agreement and section 292A of the Companies Act.

Remuneration Committee The Company has no Managing Director / Executive Director. Hence, the Remuneration Committee was not reconstituted.

Shareholders’ / Investor Grievances Committee The Shareholders’ / Investors’ Grievance Committee has been reconstituted on January 30, 2010 to comply with provisions of Clause 49 of the Listing Agreement. The composition of the Shareholders’/Investors’ Grievance Committee and the attendance of the members at the meetings for the period April 01, 2010 to February 10, 2011, are as follows:

Name of Director No. of meetings held No. of meetings attended Mr.N.Srinivasan 3 3 Mr. T.S.Raghupathy 3 3

The terms of reference of our Shareholders’/ Investors Grievance Committee are as per clause 49 of the Listing Agreement, as modified from time to time.

Details of Complaints received for the period April 01, 2009 to March 31, 2010 are as follows:

Sl. No. Details of Investor Complaints No. Of complaints 1 Complaints pending as on April 01, 2009 0 2 Complaints received during the year 0 3 Complaints redressed during the year 0 4 Complaints pending as on March 31, 2010 0

Details of Complaints received for the period April 01, 2010 to June 30, 2010 are as follows:

Sl. No. Details of Investor Complaints No. Of complaints 1 Complaints pending as on April 01, 2010 0 2 Complaints received during the period 4 3 Complaints redressed during the period 4 4 Complaints pending as on June 30, 2010 0 Details of Complaints received for the period July 01, 2010 to September 30, 2010 are as follows:

Sl. No. Details of Investor Complaints No. Of complaints 1 Complaints pending as on July 01, 2010 0 2 Complaints received during the period 2 3 Complaints redressed during the period 2 4 Complaints pending as on September 30, 2010 0 Details of Complaints received for the period October 01, 2010 to December 31, 2010 are as follows:

Sl. No. Details of Investor Complaints No. Of complaints 1 Complaints pending as on October 01, 2010 0 2 Complaints received during the period 3 3 Complaints redressed during the period 3 4 Complaints pending as on December 31, 2010 0

Share Issue Committee

The Share Issue Committee has been constituted on February 10, 2011. The composition of the committee is as follows:

(i) Mr. N Srinivasan (ii) Dr. B S Adityan (iii) Mr. T S Raghupathy (iv) Mr. V M Mohan

The terms of reference of Share Issue Committee are: to finalise and approve the issue, offer and allotment of securities, exact quantum, price, including premium and other terms and conditions, in consultation with Merchant Banker(s)/Lead Manager(s) and Advisor(s) to the issue and finalise offer document(s) and other connected document(s), paper(s) and to accept the modification(s) / alteration(s) / change(s) proposed in the said documents and to do all such act(s), deed(s) and thing(s) that are necessary, incidental and consequential for the proposed issue of securities, as set-out in the special resolutions for issue of securities in the notice to Equity Shareholders of the Company dated 31.12.2010 under section 192A of the Companies Act.

Organization Structure

Key Managerial Personnel

The key managerial personnel of our Company as on the date of filing of the Draft Letter of Offer are as follows:

Name Mr.Karan Vashisht Designation Head of Plant (‘Manager’ under the Companies Act) Qualifications BE (Mechanical) Experience (No. of years) 30 Years

Date of Commencement of Employment 26.07.2010 Age 56 Last Employment before joining our GM (Dev. & Mech) with JK Lakshmi Cement Company Limited

NOTES:

i. The Key Management Personnel mentioned above is our Permanent Employee.

ii. The Key Management Personnel mentioned above are not related parties as per the Accounting Standard 18.

iii. There is no understanding with major shareholders, customers, suppliers or any others pursuant to which any of the above mentioned personnel have been recruited.

iv. As on the date of this Letter of Offer, none of our key managerial personnel are holding any Equity Shares of our company.

Relation of the Key Managerial Personnel with our Promoters/Directors

None of our key managerial personnel are “related” to the Promoters or Directors of our Company within the meaning of Section 6 of the Companies Act.

Interest of key managerial personnel

The key managerial personnel of our Company do not have any interest in our Company other than to the extent of the remuneration or benefits to which they are entitled to as per their terms of appointment and reimbursement of expenses incurred by them during the ordinary course of business and to the extent of the Equity Shares held by them in our Company, if any.

Bonus or Profit sharing plan for the Key Managerial Personnel

We do not have any specific bonus or profit sharing plan for our key managerial personnel.

Payment or Benefit to Officers of our Company

Except for payment of monetary and non-monetary benefits in accordance with the terms of employment or engagement, we have neither paid any amount/ given any benefit to any Officer of our Company in a period of two years before the date of the Draft Letter of Offer nor such amount / benefit intended to be paid or given to any officer as on the date of this Draft Letter of Offer.

Changes in Key Managerial Personnel in the last Three Years

Following are the changes in Key Managerial Personnel in the last three years (other than superannuation):

Name / Designation Date of appointment Date of retirement / Reason resignation Karan Vashisht, 26/07/2010 - - Head of Plant Sanjay Agrawal 27/09/1990 13/01/2010 Resigned consequent Chairman & to divestment of Managing Director share holdings in the Company Surendra Kumar 19/11/1996 13/01/2010 - do - Nuwal, Director Manoj Agrawal, 30/08/1993 09/10/2009 - do - Director

Employee Stock Option Scheme (ESOP)/ Employee Stock Purchase Scheme (ESPS)

As on date of filing this Draft Letter of Offer, we do not have any Employees Stock Option Scheme or Employee Stock Purchase Scheme.

OUR PROMOTER AND PROMOTER GROUP

OUR PROMOTER: ICL FINANCIAL SERVICES LIMITED (ICLFSL)

ICL Financial Services Limited, was incorporated under the Companies Act, 1956 on October 20, 1993 vide Registration No. 26056. ICLFSL is a wholly owned subsidiary of The India Cements Limited. The Corporate Identity Number is U65991TN1993PLC026056 and the registered office is situated at “Dhun Building” 827, Anna Salai, Chennai – 600 002 Tamil Nadu.

ICLFSL is engaged in the business of finance and investments.

Board of Directors

Name of the Director Designation DIN Shri N. Srinivasan Chairman 00116726 Shri R.K. Das Director 00327985 Shri T.S. Raghupathy Director 00207220

Shareholding Pattern:

The shareholding pattern of ICLFSL as on December 31, 2010 is as follows

No. of equity % Sl. No. Name of Shareholder shares of Rs. 10 Holding each 1 The India Cements Limited 50,000 100

Brief Financial Performance:

(Rs. in Lacs)

For the financial year ended 31st March Particulars 2010 2009 2008 Paid up Equity Share Capital 5.00 5.00 5.00 Less: Debit balance of Profit and 1,972.87 1,796.09 2,136.58 Loss A/c Net Worth* (1,967.87) (1,791.09) (2,131.58) Total Income 202.38 354.56 112.01 Profit after Tax (176.78) 340.49 111.68 EPS (Rs.) (353.56) 680.98 223.36 NAV per equity share (Rs.) (3,935.74) (3,582.18) (4,263.16) *Net Worth does not include Advance for Share Capital of Rs. 591.20 Lakhs.

On July 12, 2009, ICLFSL, acquired 5,83,600 Equity Shares at a price of Rs. 22.50 per Equity Share and on July 19, 2009, ICLFSL entered into a Share Purchase Agreement with Sanjay Agrawal, Majoj Kumar Agrawal and their other associates (‘Erstwhile Promoters’) to acquire 17,87,700 Equity Shares, representing 39.73% of the subscribed equity share capital of the Company, at a price of Rs. 22.50 per Equity Share, payable in cash. In compliance with Regulations 10 and 12 of SEBI (SAST) Regulations, an open offer to acquire upto 9,00,000 Equity Shares was made by ICLFSL to the public shareholders of our Company. Pursuant to the open offer, 3,68,974 Equity Shares were acquired by ICLFSL, bringing its total shareholding to 27,40,274 Equity Shares, constituting 60.89% of the total share capital of the Company. Our Company thus became a subsidiary of ICLFSL. On October 9, 2009, March 25, 2010 and May 28, 2010, nominee directors of ICLFSL and ICL, along with other independent directors, were appointed as Directors on our Board and on October 9, 2009 and January 13, 2010, the erstwhile Promoter Directors of our Company resigned.

ICLFSL is in the business of investments and does not have any experience in the cement manufacturing business. However, ICLFSL is part of the India Cements group and draws upon the knowledge and experience of India Cements in managing our Company.

We undertake that Permanent Account Number, Bank Account details, Company Registration number and the address of the Registrar of Companies where our Promoter is registered will be submitted to the Stock Exchanges on which our Company proposes to list its Equity Shares at the time of filing of this Draft Letter of Offer with them.

ICLFSL is an unlisted Company and has not made any public issue in preceding three years. The Company does not fall under the definition of a sick industrial company within the meaning of the Sick Industrial Companies (Special Provisions) Act, 1985, nor is it under the process of winding up. The Company has not been restrained from accessing the capital market for any reasons by SEBI or by any other authority. ICLFSL has not been identified as a wilful defaulter by RBI or any other Government authority and there are no violations of securities laws committed by it in the past or any such proceeding are pending against ICLFSL. None of the promoters or persons forming part of Promoter Group have been (i) prohibited from accessing the capital markets under any order or direction passed by SEBI or any other authority or (ii) refused listing of any of the securities issued by such entity by any stock exchange in India or abroad.

Common Pursuits Except our ultimate Promoter, The India Cements Limited, none of our Promoters or Group concerns are in the same line of business as ours.

Interest of Promoters Our Promoter is interested in the promotion of our Company and are also interested to the extent of equity shares and Preference shares that it is holding and/or to be allotted to it out of the present Issue, if any, in terms of this Draft Letter of Offer and also to the extent of any

dividend payable to them and other distributions in respect of the said Equity Shares and Preference Shares. Our promoter group company, India Cements, is also interested to the extent of payment received/receivable in lieu of usage of its brand and dealer network, as per the terms of the Marketing Agreement.

Our Promoter is not interested in any property that has been acquired by our Company during the preceding two years from the date of this Draft Letter of Offer. Except as stated hereinabove and as stated in ‘Related Party Transactions’ appearing under Section titled ‘Financial Information’ beginning on page 95 of this Draft Letter of Offer, we have not entered into any contract, agreements or arrangements during the preceding two years from the date of this Draft Letter of Offer in which the Promoter is directly or indirectly interested and no payments have been made to it in respect of these contracts, agreements or arrangements. We have, however, entered into a Marketing Agreement with India Cements, further details of which are available in the section “History and other corporate information” on page 70 of the Draft Letter of Offer.

There are no companies from which our promoter has disassociated in the last three years

Payment or Benefit to our Promoters

For details of payments or benefits paid to the Promoters, please refer to the paragraph ‘Compensation to Directors’ in the Chapter titled ‘Our Management’ beginning on page 75 and ‘’Statement of Related Party Transactions” in the section titled “Financial Statements”’ on page 95 in this Draft Letter of Offer.

Related Party Transactions

For details of the related party transactions of our Company, please refer to the section “Financial Statements” on page 95 of this Draft Letter of Offer.

Our Promoter Group

In terms of Regulation 2(1)(za) and 2(1)(zb) of the SEBI (ICDR) Regulations, 2009 the following form part of our Promoter Group: Nature of Relationship Entity a subsidiary of promoter Trishul Concrete Products Limited any body corporate which holds ten per The India Cements Limited cent or more of the equity share capital of the promoter other than a subsidiary, any body  Coromandel Electric Company Limited corporate in which ten per cent or more of  Coromandel Travels Limited the equity share capital is held by the  Unique Receivable Management Private Promoter Limited  Coromandel Sugars Limited  India Cements Capital Limited  Raasi Cement Limited

 ICL Shipping Limited any body corporate in which a group of - individuals or companies or combinations thereof which hold twenty per cent. or more of the equity share capital in that body corporate also holds twenty per cent. or more of the equity share capital of the Issuer

DIVIDEND POLICY

The declaration and payment of dividends will be recommended by our Board of Directors and approved by our shareholders, at their discretion, and will depend on a number of factors, including but not limited to our profits, capital requirements and overall financial condition. The Issuer has no stated dividend policy.

Our company has not declared any dividend in the last five years.

SECTION V- FINANCIAL INFORMATION

FINANCIAL STATEMENTS

AUDITOR’S REPORT

To, The Board of Directors Trinetra Cement Limited ‘Coromandel Towers' 93, Santhome High Road Karpagam Avenue, R A Puram Chennai - 600028.

Dear Sirs,

1. We have examined the attached financial information of Trinetra Cement Limited (the “Company”), formerly known as Indo Zinc Limited, for the financial years ended March 31, 2006, March 31, 2007, March 31, 2008, March 31, 2009, March 31, 2010 and for the 6 months period ended September 30, 2010 (as set out in Annexures I to IV attached to this report), stamped and initialed by us for identification, which have been prepared in terms of the requirements of Paragraph B, Part II of Schedule II of the Companies Act, 1956 (Companies Act) and the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirement) Regulations, 2009 as amended to date (SEBI Regulations) and in accordance with engagement letter dated 10th February, 2011 with M/s Chaturvedi SK & Fellows, and engagement letter dated 18th March, 2011 with M/s DPH & Co., setting out inter alia the scope of work relating to the draft Letter of Offer being issued by the Company in connection with its proposed rights issue of Equity Shares and optionally convertible redeemable Preference Shares.

2. These information have been extracted by the Management from the audited Financial Statements for the years ended March 31, 2006, March 31, 2007, March 31, 2008, March 31, 2009, March 31, 2010 and for the 6 months period ended September 30, 2010 which have been audited by Chaturvedi SK & Fellows, who are the statutory auditors of the Company. M/s Chaturvedi SK & Fellows do not hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India. In accordance with provisions of SEBI Regulations, M/s DPH & Co. have been appointed as Auditors to the Issue and this report is being jointly provided by M/s Chaturvedi SK & Fellows and M/s DPH & Co.

3. In accordance with the requirements of Paragraph B of Part II of Schedule II of Companies Act and SEBI Regulations, and based on the foregoing; we further report that:

(a) The Statement of Assets and Liabilities of the Company, as at March 31, 2006, March 31, 2007, March 31, 2008, March 31, 2009, March 31, 2010, and September 30, 2010 as set out in Annexure-I to this report are after making adjustments and regrouping

as in our opinion were appropriate and more fully described in Significant Accounting Policies and Notes on the Restated Profit and Loss and Assets and Liabilities set out in Annexure IV to this report.

(b) The Statement of Profit or Loss and Statement of Cash Flow of the Company for each of the years ended, March 31, 2006, March 31, 2007, March 31, 2008, March 31, 2009, March 31, 2010 and for the 6 months period ended September 30, 2010 examined by us, as set out in Annexure II and III respectively, to this report are after making adjustments and regrouping as in our opinion were appropriate and more fully described in Significant Accounting Policies and Notes on the Profit and Loss and Assets and Liabilities set out in Annexure IV to this report.

i. There have been no adjustments for the changes in accounting policies retrospectively in respective financial years; ii. There have been no adjustments for the material amounts in the respective financial years to which they relate ; iii. extra-ordinary items that need to be disclosed separately in the accounts have been so disclosed; and iv. the qualifications in the auditor’s reports on the financial statements for the year ended 31st March 2006 and 31st March 2007 have been satisfied by the subsequent events as mentioned in Part C of Notes given in Annexure IV .

4. We have also examined the following other financial information prepared by the Management and approved by the Board of Directors relating to the Company for the years ended March 31, 2006, March 31, 2007, March 31, 2008, March 31, 2009, March 31, 2010 and for the 6 months period ended September 30, 2010 -

a. Statement of Secured Loans and Unsecured Loans enclosed as Annexure V b. Statement of Current Liabilities and Provisions enclosed as Annexure VI c. Statement of Investments enclosed as Annexure VII d. Statement of Fixed Assets’ Movement enclosed as Annexure VIII e. Statement of Sundry Debtors enclosed as Annexure IX f. Statement of Loans and Advances enclosed as Annexure X g. Statement of Other Income enclosed as Annexure XI h. Statement of Dividend Paid enclosed as Annexure XII i. Statement of Related Party Disclosures enclosed as Annexure XIII j. Statement of Contingent Liabilities enclosed as Annexure XIV k. Statement of Accounting Ratios enclosed as Annexure XV l. Capitalisation Statement enclosed as Annexure XVI m. Statement of Tax Shelter enclosed as Annexure XVII

In our opinion the above financial information contained in Annexures V to XVII of this report (after making adjustments and regrouping as considered appropriate), read with the Significant Accounting Policies and Notes on the Restated Profit and Loss and Assets and Liabilities (Annexure IV), have been prepared in accordance with Paragraph B of Part II of Schedule II of the Companies Act and the SEBI Regulations.

5. Our report is intended solely for use of the management and for inclusion in the draft Letter of Offer and Letter of Offer in connection with the proposed rights issue of equity shares and optionally convertible redeemable preference shares of the Company. Our report should not be used for any other purpose except with our consent in writing.

Ashwin Patel Srikant Chaturvedi Membership No.: 127052 Membership No. 70019 Partner Partner For and on behalf of For and on Behalf of DPH & Co. Chaturvedi SK & Fellows Chartered Accountants Chartered Accountants Registration No.:128862W Registration No.: 112627W

Place: Mumbai Dated: March 24, 2011

Annexure – I

STATEMENT OF ASSETS AND LIABILITIES

Net Block after adjustment for revaluation reserve 2,439.85 2,420.40 2,187.66 9,362.07 65,403.25 80,055.76

(2) Investments 7.40 7.40 7.20 - - -

(5) Net Worth (2,171.89) (2,205.63) 1,310.40 963.55 1,020.99 757.00

NOTES:

(4) Share capital consists of 4500,000 equity shares of Rs. 10 each, fully paid, net of calls unpaid of Rs. 1.22 Lacs. The share capital includes 250,000 equity shares allotted as fully paid bonus shares by capitalization of

reserves and 384,000 equity shares allotted as fully paid shares to the shareholders of Mahi Cement Ltd, the amalgamating company for consideration other than cash.

(5) During the financial year 2008-09, the Company decided to revive the Cement project at Banswara in Rajasthan. Work has been going on for execution of the project since then. Pre-operative expenses incurred on this Cement project since the financial year 2008-09, pending capitalization, are shown in the Statement of Assets and Liabilities.

(6) Capital works in progress include capital advances including advances for purchase of land for new projects.

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Annexure – II

STATEMENT OF PROFITS AND LOSSES (Rs. in Lakhs) Half Year Year Ended March 31, Ended 30th Sep 2006 2007 2008 2009 2010 2010 Income Sales of products manufactured by the issuer - - - - - of products traded in by the issuer 51.73 205.88 282.35 75.11 6.73 671.05 Total 51.73 205.88 282.35 75.11 6.73 671.05 Other Income 65.73 2.84 21.73 27.37 88.87 4.85 Increase / (Decrease) in Inventories 81.90 34.62 (60.78) (66.13) (0.57) 61.53 199.36 243.34 243.30 36.35 95.03 737.43 EXPENDITURE : Cost of Traded goods 129.71 210.48 217.10 23.11 9.30 849.41 Staff Costs 20.09 18.71 18.80 9.90 1.84 3.89 Other Operating Expenses 10.93 10.90 38.27 66.67 4.01 - Administration Charges 11.38 12.27 8.90 12.57 4.77 19.90 Selling and Distribution Expenses - - - - - 117.82 Depreciation 18.59 16.00 13.63 11.72 7.37 3.31 Interest - - 15.58 - - 7.10 Material non-recurring items: Bad debts/ advances (see note no 4 below) - - 70.37 492.59 - - Loss in value of stock due to deterioration - - 141.91 - - - Expenses relating to abandoned project 7.56 8.21 10.68 - - - (see note no. 2 below) TOTAL EXPENDITURE 198.26 276.57 535.25 616.55 27.28 1,001.42 Net Profit before tax and extra ordinary items 1.10 (33.23) (291.94) (580.20) 67.75 (263.99) Income-tax for current year ------Income-tax for earlier year (for FY1994-95) 55.45 - - - 10.31 - Deferred tax (see note no. 4 in Notes to accounts of Annexure IV) ------Fringe benefit tax 0.68 0.51 0.29 3.80 - - Total Tax 56.13 0.51 0.29 3.80 10.31 - Net Profit before extra ordinary items (55.03) (33.74) (292.23) (584.00) 57.44 (263.99) Extra ordinary Items -Net - - 526.90 65.16 - - Net Profit after extra ordinary items (55.03) (33.74) 234.67 (518.85) 57.44 (263.99)

NOTES:

(6) The Company was engaged in the business of zinc manufacturing and was having a plant at Pithampur in MP. Manufacturing activity in this plant was stopped in the year 1998-99 and remained suspended thereafter. The sales income during the financial years 2005-06 to 2009-10 was mainly from trading in non ferrous metal and scrap. The plant and machinery of the Zinc plant at Pithampur were sold during the financial year 2008-09. The zinc business of the Company is now discontinued. The losses for the years 2005-06 to 2009-10 primarily relate to this discontinued business.

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(7) The Company had decided to set up a cement plant at Banswara in Rajasthan in the year 1994-1995. However, the Company could not achieve financial closures for the project. Later, in the year 1997-98, the Company decided to abandon the project. Expenses on abandoned project shown in the above statement during the financial years 2005-06 to 2007-08 pertain to this project.

(8) During the financial year 2008-09, the Company decided to revive the above-mentioned Cement project and work has been going on for execution of the project since then. Pre-operative expenses incurred on this Cement project since the financial year 2008-09, pending capitalization, are shown in the Statement of Assets and Liabilities.

(9) Bad debts/ advances include amounts of bad debts and bad advances written off, provisions made therefor and discounts given and are net of amounts withdrawn from provisions.

(10) Extra ordinary income shown in the Profit & Loss A/c is on account of writing back of interest liability on settlement of dues of the financial institutions/ banks.

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Annexure – III STATEMENT OF CASH FLOWS (Rs. in Lakhs) Half Year Year ended March 31, Ended 2006 2007 2008 2009 2010 30.09.2010 Cash flow from operating activities: Net profit before tax and 1.10 (33.23) (291.95) (580.21) 67.75 (263.99) exceptional items Adjustments for non operating and non cash expenses: Depreciation 18.59 16.00 13.63 11.72 7.37 3.31 Interest paid - - 15.58 0.01 - 7.10 Bad & doubtful debts - - 8.01 - - - written off Bad & doubtful advances - - - 492.59 68.00 - written off Stock Deterioration - - 141.91 - - - Loss on disposal of CWIP - - - 2.26 - - Loss on sale of fixed assets - - - 0.98 - - Expenditure on abandoned 7.56 8.21 10.68 - - - project 27.25 (9.02) (102.14) (72.65) 143.12 (253.59) Adjustment for non operating income: Profit on sale of fixed asset - (1.78) - (81.52) (4.84) Provisions no more - - - (68.00) - required Interest received (60.95) (0.39) (0.12) (0.05) -

Operating profit before (33.70) (9.02) (104.31) (72.77) (6.45) (258.43) working capital changes Adjustment for changes in working capital:- (Increase)/decrease in (70.66) (34.62) 71.25 91.57 9.87 (897.37) inventories (Increase)/decrease in 16.92 (15.00) (46.60) 50.49 9.41 (10.76) debtors (Increase)/ decrease in 92.15 546.15 40.41 (623.47) (128.04) (90.81) other receivables Increase/(Decrease) in trade payable and other liabilities 40.81 (45.78) 157.61 150.77 (14.11) (13.52) Cash generated from 45.52 441.73 118.36 (403.41) (129.32) (1,270.89) operation Less: Interet paid - (15.58) (0.01) - Less: Direct taxes paid (0.53) (0.19) (0.52) (0.28) (65.61) -

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Net cash from operating 44.99 441.54 102.26 (403.70) (194.92) (1,270.89) activities (A)

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ANNEXURE - IV

SIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PART OF ACCOUNTS

(A) SIGNIFICANT ACCOUNTING POLICIES:

i. Basis of preparation of financial statements: The financial statements are prepared under the historical cost convention on the accrual basis of accounting, unless otherwise stated, in accordance with the generally accepted accounting principles in India, the provisions of the Companies Act 1956 and the applicable accounting standards.

ii. Use of Estimates: The preparation of financial statements requires estimates and assumptions. Differences between the estimates and actual results are recognised in the period in which the same are known.

iii. Fixed Assets: a) Fixed assets are stated at cost of acquisition or construction and include proportionate amount of expenditure during construction capitalized to respective assets. b) Expenditures and outlays of money on uncompleted projects of a capital nature are shown as capital works-in-progress until such time these projects are completed and commissioned. Capital works-in-progress include capital advances paid, machinery under installation/ in transit, construction and erection materials (including those lying with contractors).

iv. Depreciation: a) Depreciation on fixed assets of Zinc division is provided on written down value (WDV) method and in the manner provided in schedule XIV to the Companies Act, 1956. Depreciation on additions is provided on pro-rata basis for the period for which the assets are put to use. b) Depreciation on fixed assets of Cement division is provided on straight-line basis and in the manner provided in schedule XIV to the Companies Act, 1956. Depreciation on additions is provided on pro-rata basis for the period for which the assets are put to use. c) Assets costing less than Rs. 5000 are fully depreciated in the year of purchase. d) Leasehold land is not amortized.

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v. Impairment of Assets: An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the net selling price and value in use.

vi. Foreign Exchange Transactions: Foreign exchange transactions are recorded at the exchange rates prevailing on the date of transaction and net loss or gain arising on settlement of transaction is adjusted to profit and loss account.

vii. Valuation of inventory: a) Raw materials are valued at cost on FIFO basis. Cost includes incidental expenses such as freight, transport and clearing charges. b) Stores & spare parts are valued at cost. c) Finished goods are valued at cost or market value whichever is lower. d) Goods in process are valued at cost or net realizable value whichever is lower.

viii. Sales/ Turnover: Sales/ Turnover include sale value of goods and excise duty thereon but exclude VAT recovered.

ix. Excise duty and Cenvat Credits: Sales and purchases (other than those of capital goods) are stated inclusive of excise duty. Cenvat credits relating to capital goods are reduced from the value of the capital goods.

x. Retirement benefits: None of the employees of the company is at present entitled to any retirement benefit.

(B) NOTES TO ACCOUNTS AND SUMMARY STATEMENTS

1. The Company had become a sick industrial company within the meaning of the clause (o) of sub-section (1) of Section (3) of the Sick Industrial Companies (Special Provisions) Act 1985 and was registered with the BIFR in the year 1998. It came out of the purview of the BIFR in the year 2009, after it arrived at settlement with its lenders and repaid their dues and after its net worth became positive.

2. The Company stopped making provision for interest on financial institutions’ dues since 01.04.1998 and on bank’s dues since 01.01.1999. During the period between 2007 and 2009, the Company arrived at negotiated settlement of dues with the financial institutions/ bank and repaid their dues as per terms of settlements. As part of these settlements, the interest referred to above was waived by the financial institutions. In addition, interest liability already provided in the books of accounts was written back. The interest liability so written back amounted to Rs. 526.90 Lacs during the year ended

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31st March 2008 and Rs. 65.16 Lacs during the year ended 31st March 2009, and is shown as Extra Ordinary Income in the Profit & Loss Statements.

3. The Company also wrote back loan liabilities of the financial institutions/ bank as amounts no more payable, as per terms of settlement, amounting to Rs. 3281.36 Lacs during the year ended 31st March 2008 and Rs. 172.00 Lacs during the year ended 31st March 2009. The amounts so written back were credited to General Reserve A/c.

4. In view of the losses incurred, the Company had accumulated net deferred tax assets, as given in the Table below, in terms of provisions of Accounting Standard 22- ‘Accounting for Taxes on Income’ issued by the ICAI. However, following prudent accounting policy and the guidelines contained in the said Accounting Standard, no adjustment was made in the books of accounts for the said net deferred tax assets due to lack of reasonable certainty of realization thereof against sufficient future taxable income.

(Rs. Lakhs)

30th Sep 2006 2007 2008 2009 2010 2010 Deferred tax assets: Unabsorbed business loss 252 237 242 323 308 418 Unabsorbed depreciation 67 69 75 76 55 59 Disallowances u/s 43B 225 225 227 16 16 17 Provision for doubtful debts 170 170 2 0 0 0 Total deferred tax assets 714 701 546 415 379 494 Deferred tax liabilities 0 0 0 0 0 0 Net deferred tax assets 714 701 546 415 379 494

The value of deferred tax assets has gone down between 2006 and 2010 due to lapse of right to carry forward and set off unabsorbed business losses and due to reversal of tax benefit attached to disallowance of interest on institutional/ bank loans u/s 43B. Such interest was waived by the institutions/ banks as per terms of Negotiated Settlements and reversal of provision for the same is shown as Extra-ordinary income in the above statement.

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5. Managerial remuneration includes:

Rs. In Lacs Particulars Six month period 2009- 2008-09 2007-08 2006-07 2005-06 ended September 10 30, 2010 Salary and allowances to former Managing Nil 0.60 3.60 8.35 8.70 8.70 Director

Computation of net profit in accordance with section 349 of the Companies Act, 1956 has not been given, as commission by way of percentage of profit is not payable for the year to any of the directors of the Company.

6. Payment to Auditors (excluding service-tax) : (Rs. Lakhs) Particulars Six month period ended 2009- 2008- 2007- 2006- 2005- September 30, 2010 10 09 08 07 06 For audit fee 0.00 2.00 1.25 0.50 1.05 1.05 For tax audit fees 0.00 0.40 0.25 0.20 0.70 0.41 For tax matters and other 0.63 0.00 0.00 0.00 0.50 0.50 services

7. Segment Results: The Company has discontinued operation in its Zinc division. The income shown for the year represents income from sale of inventories of Zinc division. Its cement project is still under implementation.

8. Classification of suppliers as Micro, Small or Medium Enterprises is done where such information is provided by the supplier. No interest is paid or payable during the year to Micro Small or Medium Enterprises.

9. Balances of debtors, creditors and loans and advances are subject to confirmation. In the opinion of the management these accounts will fetch the amount as stated in the books of accounts on realisation in the ordinary course of business.

10. Expenses include prior period expenses (net) Rs -1.14 Lacs for half year ended 30.09.2010, Rs. 0.69 Lacs for year 2009-10, Rs. 1.75 Lacs for the year 2008-09, Rs. 10.8 Lacs for the year 2007-08, Rs. 0.19 Lacs for the year 2006-07 and Rs. Nil for the year 2005-06. The amounts not being material, these are shown in the year in which they were incurred and effect is not shifted to the year to which they relate.

11. Information pursuant to paragraph 3, 4C of Part II of Schedule VI to the Companies Act:

(i) The company is setting up a new cement plant at Banswara in Rajasthan with annual installed capacity of 1.5 million tonnes. Trial production has commenced in the said plant during the half year ended 30th September 2010. The company disposed off all

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plant and machinery of its Zinc plant at Pithampur in MP during the year 2008-09. No production activity was carried on in the Zinc plant during the years from 2005- 06 to 2008-09.

(ii) Sales, Purchases & Finished Goods Stocks:

Item Cement Non ferrous metals & scrap Six Month Ended 2009-10 2008-09 2007-08 2006-07 2005-06 30.09.2010 Particulars Qty Val. Qty Val. Qty Val Qty Val Qty Val Qty Val . . . . Turnover 20861 671 238 7 67 73 28 15 20 171 3 75 9 2 0 6 2 52 Purchases 24142 849 **21 ** 62 69 21 17 21 178 12 2 9.3 4 23 1 7 8 0 1 9 Opening 0 24 1 67 12 12 stock 73 1 7 93 93 24 11 Closing 1709 62 0 0 24 73 67 12 12 stock 1 1 7 93 93 **Represents transfer from Raw Material stock.

(iii) CIF Value of imports and remittances in foreign currency (for import of capital goods)- Half year ended 30th Sep 2010 Rs. Nil (Yr 2009-10 Rs. 1707 Lacs, 2008-09 Rs. Nil,2007-08 Rs. Nil, Year 2006-07 Rs. Nil, Year 2005-06, Rs. Nil).

(iv) Exports or earnings in foreign currency (Half year ended 30th Sep 10 Rs. Nil, Yr. 2009- 10 Rs. Nil, Year 2008-09 Rs. Nil, Year 2007-08 Rs. Nil, Year 2006-07 Rs. Nil, Year 2005-06 Rs.4.36 Lacs.

(v) Previous year’s figures have been reclassified / regrouped wherever necessary.

(i) On Going Concern Assumption:

The Auditors’ Report for the year ended 31st March 2006 included following qualification: “(i) The accounts of the company have been prepared on going concern basis despite it being a sick industrial company within the meaning of the clause (o) of sub section (1) of Section (3) of the Sick Industrial Companies (Special Provisions) Act, 1985. Its reference to BIFR is registered as case No.277/98. The management has submitted proposals to the lenders for settlement of dues. Major participating financial institutions have given their in-principle approval to such proposals. In view of these developments, the accounts of the Company have been prepared on the basis that the company is a going concern though there is substantial erosion of its net worth and severe impairment of its liquidity and the viability of company’s operations depends upon substantial financial support from outside.”

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The Auditors’ Report for the year ended 31st March 2007 included following qualification: “(i) The accounts of the company have been prepared on going concern basis despite it being a sick industrial company within the meaning of the clause (o) of sub section (1) of Section (3) of the Sick Industrial Companies (Special Provisions) Act, 1985. Its reference to BIFR is registered as case No.277/98. The management has submitted proposals to the lenders for settlement of dues. Major participating financial institutions have given their approval to such proposals. In view of these developments, the accounts of the Company have been prepared on the basis that the company is a going concern though there is substantial erosion of its net worth and severe impairment of its liquidity and the viability of company’s operations depends upon substantial financial support from outside.” In the following years, the Company repaid the dues of the financial institutions/ banks as per terms of settlement, came out of the purview of the BIFR, raised fresh funds for its Cement project at Banswara in Rajasthan and completed and commissioned the said Cement project.

In view of these subsequent developments, the above mentioned qualifications in Auditors’ Reports stand satisfied.

(ii) On Non Provision of Interest on Loans:

The Auditors’ Reports for the year ended 31st March 2006 included following qualification: “(ii) No provision has been made for interest on term loans from financial institutions since 01.04.1998 and on working capital facilities from bank since 01.01.1999 due to expression of intention by major financial institutions and bank to waive the same under negotiated settlement of dues. The interest liability, as may be arrived at as part of the settlement, shall be provided for in the year of payment. The liabilities of the Company towards financial institutions and bank are subject to reconciliation and confirmation.” The Auditors’ Reports for the year ended 31st March 2007 included following qualification: “(ii) No provision has been made for interest on term loans from financial institutions since 01.04.1998 and on working capital facilities from bank since 01.01.1999 in view of settlements arrived at with the major financial institutions and bank. Provision of interest liability or the write off, as the case may be, shall be adjusted in the books of the company on completion of payments of settlement moneys and on receipt of No Dues Certificates from the lenders. The liabilities of the Company towards financial institutions and bank are subject to reconciliation and confirmation.” In the following years, the Company repaid the dues of the financial institutions/ bank as per terms of settlement. The interest on loans, non-provision whereof was referred to in qualifications in the Auditors’ Reports, was fully waived by the lenders.

In view of these subsequent developments, the above mentioned qualifications in Auditors’ Reports stand satisfied.

(iii) Balances of Debtors, Creditors and Loans and advances subject to Confirmation:

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The Auditors’ Reports for the year ended 31st March 2006 and 31st March 2007 included following qualification: “(iii) Balances of debtors, creditors and loans & advances are subject to confirmation.” In the following years, the above referred balances have been either realized or fully provided for or confirmed.

In view of these subsequent developments, the above mentioned qualification in Auditors’ Reports stands satisfied.

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Annexure - V

STATEMENT OF SECURED LOANS AND UNSECURED LOANS (Rs. Lakhs)

A. Secured Loans

As at 31st March As at 30 th September Particulars 2006 2007 2008 2009 2010 2010 a) Privately placed Redeemable Non- Convertible Debentures: (i) 16.5 % Redeemable Non-convertible 300.00 300.00 - - - - Debentures (redeemed in the year - - - - - 2007-08) b) Loan from Financial Institutions : (i) Rupee Term Loans 450.00 385.00 250.00 - 8,000.00 8,000.00 c) Loan from Banks : (i) Rupee Term Loans 2,534.26 1,899.21 - - 8,000.00 10,947.28 (ii) Working capital loans 1530.65 1288.95 - - - - d) Interest accrued and due 592.06 592.06 65.16 - 192.00 146.46 e) Short Term Loan - - - 8,700.02 - - Total 5406.97 4465.22 315.16 8700.02 16192.00 19093.75

B. Un Secured Loans As at 31st March As at 31st September Particulars 2006 2007 2008 2009 2010 2010 a) From The India Cements Ltd - - - - 48,997.63 58,884.93 b) From Directors 25.30 40.30 42.30 - - - c) From Others - 514.18 285.90 - - - Total 25.30 554.48 328.19 - 48,997.63 58,884.93

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Annexure - VI

STATEMENT OF CURRENT LIABILITIES AND PROVISIONS (Rs. In Lakhs) Current Liabilities: As at 31st March As at 30 th September

Particulars 2006 2007 2008 2009 2010 2010 (a) Sundry Creditors 152.95 118.39 264.73 456.43 3,244.26 5,780.40 (b) Advance from Customers 38.22 26.75 39.33 0.70 - -

Total (A) 357.69 311.65 470.58 458.13 3,245.26 5,781.40 Provisions : (a) Provision for Income Tax 55.60 55.92 55.69 59.20 - - (b) Provision for Gratuity 3.37 3.62 2.30 - - - Total (B) 58.97 59.54 57.98 59.20 - - Grand Total (A+B) 416.66 371.19 528.56 517.33 3,245.26 5,781.40

Annexure - VII

STATEMENT OF INVESTMENTS (Rs. In Lakhs) As at 30 th As at 31st March September Particulars 2006 2007 2008 2009 2010 2010

Long Term Investments(Quoted) – Fully paid shares of E-Metals India 1 Limited 7.20 7.20 7.20 - - - Long Term Investments(Un Quoted) 2 SBI floating interest Rate Bond 0.20 0.20 - - - - Total Investments 7.40 7.40 7.20 - - -

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Annexure – VIII

STATEMENT OF FIXED ASSETS’ MOVEMENT

(Rs. In Statement of Fixed Assets’ movement in the Half year ended on 30th Sep, 2010 Lakhs)

Particulars G R O S S B L O C K D E P R E C I A T I O N N E T B L O C K As at Addition Deletion As at Up to For the Write Up to As at As at 01.04.2010 30.09.2010 01.04.2010 year back 30.09.2010 30.09.2010 31.03.2010 Land- Leasehold 44.07 - - 44.07 - - - - 44.07 44.07 Land- Freehold 37.59 - - 37.59 - - - - 37.59 37.59 Buildings 229.98 - 1.34 228.64 168.68 2.02 0.68 170.02 58.62 61.30 Plant & Machinery 12.42 - - 12.42 8.72 0.31 - 9.03 3.39 3.70 Furniture & Fixtures 18.12 - - 18.12 11.02 0.58 - 11.59 6.53 7.11 Other Assets 67.24 - - 67.24 21.08 2.85 - 23.93 43.31 46.16 Grand Total 409.42 - 1.34 408.08 209.50 5.75 0.68 214.57 193.51 199.92

(Rs. In Statement of Fixed Assets’ movement in the year ended on 31st March, 2010 Lakhs)

G R O S S B L O C K D E P R E C I A T I O N N E T B L O C K For As at Particulars As At As at Up to Write As at As at Addition Deletion the 31.03.201 01.04.2009 31.03.2010 01.04.2009 Back 31.03.2010 31.03.2009 year 0 Lease - Lease hold 44.07 - - 44.07 - - - - 44.07 44.07 Land - Freehold 33.24 4.35 - 37.59 - - - - 37.59 33.24 Buildings 243.94 - 13.96 229.98 171.49 4.80 7.62 168.68 61.30 72.44 Plant & Machinery 12.42 - - 12.42 8.11 0.62 - 8.72 3.70 4.31 Furniture & Fixtures 13.43 4.70 - 18.12 9.96 1.06 - 11.02 7.11 3.47 Other Assets 36.83 30.42 - 67.24 16.35 4.73 - 21.08 46.16 20.47 Grand Total 383.92 39.46 13.96 409.42 205.91 11.20 7.62 209.50 199.92 178.00 Previous Year 987.90 17.04 621.02 383.92 772.70 12.36 579.14 205.91 178.00 215.20

(Rs. In Statement of Fixed Assets’ movement in the year ended on 31st March, 2009 Lakhs)

G R O S S B L O C K D E P R E C I A T I O N N E T B L O C K For Particulars As At As at Upto Write As at As at As at Addition Deletion the 01.04.2008 31.03.2009 01.04.2008 Back 31.03.2009 31.03.2009 31.03.2008 year Lease - Lease hold 44.07 - - 44.07 - - - - 44.07 44.07 Land – Freehold 31.84 1.40 - 33.24 - - - - 33.24 31.84 Buildings 243.94 - - 243.94 166.26 5.24 - 171.49 72.44 77.68 Plant & Machinery 511.94 - 499.52 12.42 471.11 3.61 466.62 8.11 4.31 40.83 Electrical Installations 23.42 - 23.42 - 21.90 - 21.90 - - 1.52 Furniture & Fixtures 37.58 1.63 25.79 13.43 32.67 1.16 23.88 9.96 3.47 4.91 Vehicles 26.62 - 26.62 - 25.81 0.02 25.83 - - 0.81 Other Assets 68.49 14.01 45.67 36.83 54.94 2.33 40.92 16.35 20.47 13.55 Grand Total 987.90 17.04 621.02 383.92 772.70 12.36 579.14 205.91 178.00 215.20 Previous Year 1,104.07 - 116.17 987.90 869.72 17.07 114.09 772.70 215.20 234.35

114

(Rs. In Statement of Fixed Assets’ movement in the year ended on 31st March, 2008 Lakhs)

G R O S S B L O C K D E P R E C I A T I O N N E T B L O C K For Particulars As At As at Upto Write As at As at As at Addition Deletion the 01.04.2007 31.03.2008 01.04.2007 Back 31.03.2008 31.03.2008 31.03.2007 year Lease - Lease hold 44.07 - - 44.07 - - - - 44.07 44.07 Land - Freehold 31.84 - - 31.84 - - - - 31.84 31.84 Plant & Machinery 521.01 - 9.07 511.94 471.22 7.25 7.36 471.11 40.83 49.79 Electrical Installations 26.30 - 2.88 23.42 24.26 0.28 2.64 21.90 1.52 2.04 Buildings 243.94 - - 243.94 160.54 5.71 - 166.26 77.68 83.39 Furniture & Fixtures 37.58 - - 37.58 31.28 1.39 - 32.67 4.91 6.30 Vehicles 31.44 - 4.82 26.62 30.22 0.29 4.69 25.81 0.81 1.23 Other Assets 68.49 - - 68.49 52.79 2.15 - 54.94 13.55 15.70 Leased Asset 99.40 - 99.40 - 99.40 - 99.40 - - - Grand Total 1,104.07 - 116.17 987.90 869.72 17.07 114.09 772.70 215.20 234.35 Previous Year 1,104.07 - - 1,104.07 850.26 19.45 - 869.72 234.35 253.80

(Rs. In Statement of Fixed Assets’ movement in the year ended on 31st March, 2007 Lakhs)

G R O S S B L O C K D E P R E C I A T I O N N E T B L O C K For Particulars As At As at Upto Write As at As at As at Addition Deletion the 01.04.2006 31.03.2007 01.04.2006 Back 31.03.2007 31.03.2007 31.03.2006 year Lease - Lease hold 44.07 - - 44.07 - - - - 44.07 44.07 Land – Freehold 31.84 - - 31.84 - - - - 31.84 31.84 Plant & Machinery 521.01 - - 521.01 462.59 8.63 - 471.22 49.79 58.41 Electrical Installations 26.30 - - 26.30 23.93 0.33 - 24.26 2.04 2.37 Buildings 243.94 - - 243.94 154.30 6.24 - 160.54 83.39 89.63 Furniture & Fixtures 37.58 - - 37.58 29.82 1.47 - 31.28 6.30 7.77 Vehicles 31.44 - - 31.44 29.79 0.43 - 30.22 1.23 1.65 Other Assets 68.49 - - 68.49 50.44 2.35 - 52.79 15.70 18.05 Leased Asset 99.40 - - 99.40 99.40 - - 99.40 - - Grand Total 1,104.07 - - 1,104.07 850.26 19.45 - 869.72 234.35 253.80 Previous Year 1,104.00 0.07 - 1,104.07 828.23 22.04 - 850.26 253.80 275.77

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Statement of Fixed Assets’ movement in the year ended on 31st March, 2006 (Rs. In Lakhs)

G R O S S B L O C K D E P R E C I A T I O N N E T B L O C K For Writ Particulars As At As at Upto As at As at Addition Deletion the e As at 31.03.2005 01.04.2005 31.03.2006 01.04.2005 31.03.2006 31.03.2006 year Back Lease - Lease hold 44.07 - - 44.07 - - - - 44.07 44.07 Land - Freehold 31.84 - - 31.84 - - - - 31.84 31.84 Plant & Machinery 521.01 - - 521.01 452.52 10.08 - 462.59 58.41 68.49 Electrical Installations 26.30 - - 26.30 23.54 0.38 - 23.93 2.37 2.76 Buildings 243.94 - - 243.94 147.48 6.83 - 154.30 89.63 96.46 Furniture & Fixtures 37.58 - - 37.58 28.25 1.57 - 29.82 7.77 9.33 Vehicles 31.44 - - 31.44 29.21 0.58 - 29.79 1.65 2.23 Other Assets 68.42 0.07 - 68.49 47.83 2.60 - 50.44 18.05 20.59 Leased Asset 99.40 - - 99.40 99.40 - - 99.40 - - Grand Total 1,104.00 0.07 - 1,104.07 828.23 22.04 - 850.26 253.80 275.77 Previous Year 1,109.18 1.95 - 1,111.13 780.38 29.42 - 809.80 301.33 328.80

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Annexure - IX

STATEMENT OF SUNDRY DEBTORS (Rs. In Lakhs) As at 30 th As at 31st March September Particulars 2006 2007 2008 2009 2010 2010 (i) Unsecured :- a) Considered good 7.00 7.00 - 16.58 7.17 17.92 b) Considered 350.39 350.39 - - - - doubtful (ii) Others :- a) Considered good 6.48 21.48 67.07 - - - Less: Provisions for 350.39 350.39 - - - - Doubtful debts Total Sundry Debtors* 13.48 28.48 67.07 16.58 7.17 17.92

* Debtors do not include any amount due from Directors / Related parties.

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Annexure - X

STATEMENT OF LOANS AND ADVANCES (Rs. In Lakhs) As at 30 th As at 31st March September Particulars 2006 2007 2008 2009 2010 2010 Unsecured – Considered good unless stated otherwise (a) Advances recoverable in cash or in kind or for value to be received 772.95 229.65 43.67 1,129.01 2,437.53 3,311.60 (b) Accrued Income - - - 0.12 - - (c) Prepaid Expenses 0.34 0.00 0.08 0.17 0.16 2.64 (d) Deposits 66.16 63.64 59.32 20.01 15.01 13.91 (e) Tax Deducted at source 3.96 3.96 3.96 3.97 0.06 - 843.40 297.25 107.03 1,153.29 2,452.77 3,328.15 Less: Provision for doubtful Advances 154.81 154.81 5.00 427.80 359.80 359.80 Total Loans and Advances 688.59 142.43 102.03 725.49 2,092.97 2,968.35

Annexure - XI

STATEMENT OF OTHER INCOME (Rs. In Lakhs) As at 30 th As at 31st March September Particulars 2006 2007 2008 2009 2010 2010

Rent 1.27 1.27 0.60 - - - Interest Received 60.95 - 0.39 0.12 0.05 - Commission Received 0.14 - - - - - Input VAT Credit - 1.22 - - - - Sales of Scrap & other Items - 0.01 3.05 1.09 - - Profit on sale of Fixed assets - - 1.78 - 81.52 4.84 Miscellaneous receipts 1.13 0.01 0.06 0.30 0.05 0.01 Sundry balances written back 2.24 (0.04) 1.77 3.12 7.25 - Excess provisions no more required - 0.37 14.08 22.73 - - Total Other Income* 65.73 2.84 21.73 27.37 88.87 4.85

* All Other Income is of Non Recurring in nature

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Annexure - XII

STATEMENT OF DIVIDEND PAID As at 30th As at 31st March September Particulars 2006 2007 2008 2009 2010 2010 Equity Shares Nos. 45,00,000 45,00,000 45,00,000 45,00,000 45,00,000 45,00,000 Preference Nos. ------Shares Face value Per Rupees Equity Share 10 10 10 10 10 10 Face Value Per Pref. Share Rupees ------Paid up value Per Equity Share Rupees 10 10 10 10 10 10 Paid up value Rupees Per Pref. Share ------Rate of % Dividend ------Total ------Dividend Paid Rs. In Lakhs ------Tax on Dividend Rs. In Lakhs ------

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Annexure – XIII

STATEMENT OF RELATED PARTY DISCLOSURE (in keeping with Accounting Standard 18

Note: The management of the Company has undergone change during the year ended 31st March 2010 pursuant to acquisition of control in accordance with the provisions of Securities & Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations 1997. The India Cements Ltd, through its subsidiary ICL Financial Services Ltd, has acquired controlling interest in the Company from its erstwhile promoters, namely Mr Sanjay Agarwal and associates.

(A) Statement of related party disclosures for the years 2009-10, 2010-11 (Half year) (in keeping with Accounting Standard 18): Name of Related Party Relationship The India Cements Ltd Parent Company and Holding Company of ICL Financial Services Ltd. ICL Financial Services Holding Company. Ltd

Related parties Nature of transactions For the year ended Half Year Ended 31.03.2010 30th September 2010 Amount Outstanding Amount Outstanding Rs. In lakhs Rs. In lakhs

The India Cements Ltd Loan received 40298 48998 9,887 58,885 Interest provided/paid* 2253 0 1,628 1,628 Purchase of goods Nil Nil 849 773 Note:

 Rate of Interest payable: 8 % payable annually  Nature of repayment: Repayable on demand

(B) Statement of related party disclosures for the years 2008-09, 2007-08, 2006-07 and 2005-06 (in keeping with Accounting Standard 18):

Name of Related Party Relationship

Mr.Sanjay Agarwal, Mr.Manoj Agarwal,Mr.S K Nuwal Key Management persons

Company in which Key management persons have E Metals India Ltd.,Globex Export Pvt.Ltd control or substantial interest.

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Related Nature of For the year ended For the year ended For the year ended For the year ended parties transactions 31.03.2006 31.03.2007 31.03.2008 31.03.2009 Amount Outstanding Amount Outstanding Amount Outstanding Amount Outstanding Rs. In lakhs Rs. In lakhs Rs. In lakhs Rs. In lakhs Key Remuneration paid 8.70 - 8.70 1.07 8.35 5.60 3.60 1.44 Management Loan received - 25.30 - 40.30 - 40.30 - - persons Share application

money received - 140.52 - 140.52 - 140.52 - -

Rent Deposit given - 50.00 - 50.00 - 50.00 - 50.00 E Metals Rent received 0.24 - 0.24 - 0.24 - - - India Ltd Loan Received - 7.20 47.46 47.22 248.01 83.42 - - Investment in Shares - - - 7.20 - 7.20 - -

Loan given ------354.49 354.49 Globex Rent received - - 0.12 - 0.12 - - - Export Pvt.Ltd Loan Received - - 183.80 183.92 - 183.80 - -

Additonally, managerial remuneration of Rs.60,000 is paid to former Managing Director Mr.Sanjay Agarwal for the year 2009-10

Annexure – XIV

STATEMENT OF CONTINGENT LIABILITIES

(Rs. Lakhs)

As at As at As at As at As at Half Year Ended 31.03.2006 31.03.2007 31.03.2008 31.03.2009 31.03.2010 30.09.2010 a) Estimated amount of contracts 3534 3534 3534 21740 27394 16071 (net of advances) remaining to be executed on capital account and not provided for. b) Interest for late payment of Nil Nil Nil Nil 55 Nil income-tax for which demand is raised by the Government but company has applied for waiver of the same. c) Sales tax and Entry tax demands 246.13 246.13 244.31 Nil Nil Nil against which company has filed application for revision

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Annexure - XV

STATEMENT OF ACCOUNTING RATIOS

Particluars As at 31st March As at 30 th September 2006 2007 2008 2009 2010 2010 - 1 Adjusted Net Profit after Tax ,As restated for- Particulars (a) Basic EPS Rs. In Lakhs (55.03) (33.73) (292.23) (584.00) 57.44 (263.99)

(b) Basic EPS after Extra Rs. In Lakhs (55.03) (33.73) 234.67 (518.85) 57.44 (263.99) ordinary items -2 Weighted average number of Ordinary Shares for: (a) Basic EPS Numbers 4,500,000 4,500,000 4,500,000 4,500,000 4,500,000 4,500,000 (b) Basic EPS after Extra Numbers 4,500,000 4,500,000 4,500,000 4,500,000 4,500,000 4,500,000 ordinary items

-3 Number of Ordinary Shares Numbers 4,500,000 4,500,000 4,500,000 4,500,000 4,500,000 4,500,000 outstanding at the end of the period/year -4 Net Rs. In Lakhs (2,171.89) (2,205.63) 1,310.40 963.55 1,020.99 757.00 Worth -5 Accounting Ratios (i) (a) Basic EPS Rupees (1.22) (0.75) (6.49) (12.98) 1.28 (5.87) [(1)(a)/(2)(a)] (b) Basic EPS after Rupees (1.22) (0.75) 5.21 (11.53) 1.28 (5.87) Extra ordinary Items [(1)(b)/(2)(b)] (ii) Return on Net Percentage -2.53% -1.53% 17.91% -53.85% 5.63% -34.87% Worth[(1)(b) /(4)] x 100 (iii) Net Assets Value per Rupees (48.26) (49.01) 29.12 21.41 22.69 16.82 Share [ (4) / (3) ]

Notes: (a) The above ratios have been computed on the basis of the Restated Statement of Assets and Liabilities and Profit and Los ses. (Annexure I and Annexure II). (b) Returns on Net Worth represents Adjusted Net Profit after Tax divided by Adjusted Net Worth. (c) Net Assets Value per share is calculated as Net Worth at the end of each financial year divided by the number of ordinary shares outstanding at the end of each financial year.

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Annexure - XVI

CAPITALISATION STATEMENT

Rs. in Lakhs Particulars Pre-Issue as at Adjusted for Rights issue 30 th September 2010 Borrowings: Secured Loans 19,093.75 19,093.75 Unsecured Loans 58,884.93 29,905.42 Total Debt 77,978.68 48,999.17

Shareholders’ Funds: Share Capital 448.78 23,374.34(d) Reserves and Surplus 308.22 6,462.17

Total Share holders’ Funds 757.00 29,836.51

Debt / Equity Ratio 103.01 1.64

Notes: (a) The above ratio has been computed on the basis of statement of assets and liabilities as at 30 th September 2010 ( Refer Annexure I) (b) Unsecured Loans post the rights issue has been adjusted for repayment of loan to ICLFSL as per the objects of the Issue. (c) Reserves have not been adjusted for any issue expenses of the proposed rights issue (d) An amount of Rs.10 Crore (10, 00,000 Non Convertible Cumulative Redeemable preference shares of Rs. 100 each) is made on 14th March, 2011on preferential basis.

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Annexure - XVII

STATEMENT OF TAX SHELTER

(Rs. In Lakhs)

Year Ended 31st March, Half year ended Particulars 2006 2007 2008 2009 2010 30/09/2010 Tax rate including 33.66 33.66 33.99 33.99 33.99 33.22 surcharge Profit before tax and 1.10 (33.23) (291.94) (580.20) 67.75 (263.99) extra-ordinary items Tax at normal rate 0.37 (11.19) (99.23) (197.21) 23.03 (87.69) Adjustments:- (i) Permanent Difference Expenditure on 7.56 8.21 10.68 - - - abandoned project Effects of deviation from (2.72) - - - - - provision of section 145A Provisions/write off of - - (149.81) 493.05 - - loans and advances Other adjustments 0.46 0.02 - 1.76 0.70 1.14 Capital gain- difference - - (1.78) 8.63 (77.63) 1.33 between book profit and taxable gain (ii) Timing Difference Difference between tax 14.49 12.21 10.18 (2.70) (0.72) (1.03) depreciation and book depreciation Provision for bad debts - - (350.40) - - - Other adjustments 2.58 0.89 (26.29) - (0.05) - Brought forward losses (23.47) - - - - - adjusted Total Adjustments (1.10) 21.33 (507.42) 500.74 (77.70) 1.44 Tax Expenses/(Savings) on (0.37) 7.18 (172.47) 170.20 (26.41) 0.48 total adjustments Taxable Income - (11.90) (799.36) (79.46) (9.95) (262.55) Income-tax ------

Extra Ordinary items-Net - - 526.90 65.16 - - Tax at normal rate - - 179.09 22.15 - - Reversal of timing - - (526.90) (65.16) - - difference relating to disallowances u/s 43B. Tax Expenses/(Savings) on - - (179.09) (22.15) - - above adjustment

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FINANCIAL INFORMATION OF GROUP COMPANIES As on the date of this Draft Letter of Offer, our Group Companies are the following:

1. Trishul Concrete Products Limited

2. The India Cements Limited

3. India Cements Capital Limited

4. ICL Securities Limited

5. ICL International Limited

6. PT Coromandel Mineral Resources, Indonesia

7. Coromandel Sugars Limited

8. Industrial Chemicals and Monomers Limited

9. Coromandel Electric Company Limited

10. Raasi Cement Limited

11. Coromandel Travels Limited

12. ICL Shipping Limited

13. Unique Receivable Management Private Limited

14. Coromandel Minerals Pte Ltd., Singapore

Out of the companies listed above, The India Cements Limited and India Cements Capital Limited are listed on the stock exchanges. In compliance with SEBI (ICDR) Regulations, the financial information of these two listed group companies, along with that of 3 largest unlisted group companies (based on turnover for the financial year ending March 31, 2010) is being provided as under:

A. FINANCIAL INFORMATION OF LISTED GROUP COMPANIES: 1. The India Cements Limited (“India Cements”)

India Cements was incorporated on February 21, 1946, as a public limited company to manufacture and market cement. The commercial production began in August 1949 at its first plant at Sankarnagar in the state of Tamil Nadu, which was one of the first cement manufacturing plants to be established in South India. The Corporate Identification Number of the Company is L26942TN1946PLC000931. The Registered Office of India Cements is at “Dhun Building” 827, Anna Salai, Chennai – 600 002, Tamil Nadu.

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Main Objects

The main objects of India Cements as per the Memorandum of Association, inter alia, include the following:

“To produce, manufacture, purchase, refine, prepare, process, import, export, sell and generally to deal in cement, Portland cement, alumina cement, lime and limestone, clinker and/or by-products thereof and building materials generally and in connection therewith to acquire, erect, construct, establish, operate and maintain cement factories, limestone quarries, workshops and other works.”

Current Nature of Activities

The company is engaged primarily in the business of manufacturing and marketing of cement. It is the largest producer of cement in south India by volume. India Cements owns and operates nine integrated cement manufacturing plants, including two grinding units, in the states of Andhra Pradesh, Tamil Nadu and Maharashtra, and has a total installed capacity of approximately 14 MTPA. The company also has wind mills, generating power to the tune of 359 lacs units during the year 2009-10. The Company’s Shipping division which presently owns two handy max bulk carriers enables the company to save freight, as they were being employed for inward movement of coal and other raw materials whenever they were not tramping.

Board of Directors

As on date, the Board of Directors consists of:

Sl. No. Name Designation DIN 1 Shri N. Srinivasan Vice Chairman& Managing Director 00116726 2 Mrs. Chitra Srinivasan Director 01094213 3 Ms. Rupa Gurunath Wholetime Director 01711965 4 Dr. B. S. Adityan Director 00037717 5 Shri Arun Datta Director 00180069 6 Shri R. K. Das Director 00327985 7 Shri N. R. Krishnan Director 00047799 8 Shri V. Manickam Nominee Director – LIC 00179715 9 Shri K.P.Nair Nominee Director–IDBI Bank Limited 02611496 10 Shri A. Sankarakrishnan Director 00054462 11 Shri N.Srinivasan Director 00004195 12 Shri K.Subramanian Nominee Director-HUDCO 00841513

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Details of Listing of Equity Shares

Year of Initial Listing Madras Stok Exchange Limited – Since 1946 Bombay Stock Exchange Limited – since 1954 National Stock Exchange of India Limited - since 2000 Name of the Stock Madras Stock Exchange Limited (Scrip Code: INDCEM) Exchanges where Bombay Stock Exchange Limited (Scrip Code: 530005) currently listed National Stock Exchange of India Limited (Scrip Code: INDIACEM)

Besides the above, the Global Depository Receipts and Global Depository Shares of India Cements are listed on Luxembourg Stock Exchange and the Foreign Currency Convertible Bonds are listed on the Singapore Stock Exchange.

Shareholding Pattern as on December 31, 2010

Total Shares pledged Shareholding as a or otherwise % of total No. of Total No. of encumbered No. of Shares Total No. of Shares held in Category of Shareholder Share As a % Shares Dematerialized holders As a % As a % of Form Number of of of Total shares (A+B) (A+B+C) No. of Shares (A) Shareholding of Promoter and Promoter Group

(1) Indian

Individuals / Hindu Undivided 3 20,015,896 20,013,956 6.66 6.52 - - Family Bodies Corporate 3 57,040,057 57,030,057 18.97 18.57 56,986,625 99.91 Directors/Promoters & their 5 288,540 147,400 0.10 0.09 - - Relatives Sub Total 11 77,344,493 77,191,413 25.73 25.18 56,986,625 73.68 (2) Foreign

Total shareholding of Promoter 11 77,344,493 77,191,413 25.73 25.18 56,986,625 73.68 and Promoter Group (A) (B) Public Shareholding

(1) Institutions

Mutual Funds / UTI 32 18,027,628 18,012,888 6.00 5.87 - - Financial Institutions / Banks 29 1,816,600 1,808,671 0.60 0.59 - - Insurance Companies 8 27,319,628 27,319,378 9.09 8.90 - - Foreign Institutional Investors 130 88,294,574 88,252,874 29.38 28.74 - - Sub Total (B)(1) 199 135,458,430 135,393,811 45.07 44.10 - - (2) Non-Institutions

Bodies Corporate 1,565 50,963,225 50,898,828 16.96 16.59 - -

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Individuals - -

Individual shareholders holding nominal share capital up to Rs. 1 99,923 20,590,660 19,055,766 6.85 6.70 - - lakh Individual shareholders holding nominal share capital in excess of 119 4,416,591 4,320,917 1.47 1.44 - - Rs. 1 lakh

Directors & their Relatives 4 17,204 3,000 0.01 0.01 - -

Foreign Corporate Bodies 2 8,461,304 8,461,304 2.82 2.75 - - Overseas Corporate Bodies 2 2,000 1,500 - - - - Non Resident Indians 1,519 1,033,739 1,028,141 0.34 0.34 - - Custodian of Enemy Property 37 11,854 - - - - - Trusts 17 186,853 186,853 0.06 0.06 - - Hindu Undivided Families 1,694 1,571,830 1,571,830 0.52 0.51 - - Clearing Members 161 513,856 513,856 0.17 0.17 - - Sub Total (B) (2) 105,043 87,769,116 86,041,995 29.20 28.57 - - Total Public shareholding (B) 105,242 223,227,546 221,435,806 74.27 72.67 NA NA Total (A)+(B) 105,253 300,572,039 298,627,219 100.00 97.85 56,986,625 18.96 (C) Shares held by Custodians and against which Depository

Receipts have been issued (1) Promoter and Promoter Group ------(2) Public 2 6,603,618 6,592,181 - 2.15 - - Sub Total (C) 2 6,603,618 6,592,181 - 2.15 NA NA Total (A)+(B)+(C) 105,255 307,175,657 305,219,400 - 100.00 56,986,625 18.55

The Company complies with clause 40A of the Listing Agreement, complies with provisions of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 1997 and SEBI (Prohibition of Insider Trading) Regulations 1992 and is not in default with regard to payment of listing fees to any stock exchange.

Audited Standalone Financial Information

(Rs. In Lacs)

Year ending March 31, Particulars 2010 2009 2008 Equity Capital 30,717 28,243 28,187 Reserves and Surplus* 318,019 262,559 224,427 Net Worth 348,736 290,802 252,614 Sales/Income 380,826 347,490 309,826

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Profit / (Loss) after tax 35,434 43,218 63,754 Earnings per equity share (Rs.) 12.49 15.32 23.97 NAV per equity share (Rs.) 113.53 102.96 89.62 * Figures exclude revaluation reserve and deferred income and after adjustment of deferred revenue expenditure.

The stock market data of India Cements at BSE is as under:

Month High (Rs.) Low (Rs.) No. of Shares Total Turnover Traded (Rs in Lacs) September 2010 122.00 105.65 128,33,363 14673.12 October 2010 125.40 109.00 46,56,641 5492.97 November 2010 127.80 95.00 54,35,725 6387.22 December 2010 112.80 98.20 17,85,303 1908.68 January 2011 112.80 96.20 17,11,405 1769.11 February 2011 99.80 81.00 56,84,775 5168.91 (Source: www.bseindia.com)

Other Details:

Public or rights Issue in the preceding three years* No Whether the company has become a sick company within No the meaning of the Sick Industrial Companies (Special Provisions) Act, 1995 or is under winding up Whether the company has made a loss in the immediately No preceding year * India Cements issued 24,594,000 equity shares of Rs. 10 each on March 15, 2010 through a Qualified Institutions Placement. Further it has also allotted 14,20,500 equity shares to its employees between January 2008 and March 2011, pursuant to an Employee Stock Option Scheme.

There are no defaults in meeting any statutory/bank/institutional dues.

2. India Cements Capital Limited (“ICCL”)

India Cements Capital Limited was incorporated on November 08, 1985 as Aruna Finance Limited. The name of the company was changed to Aruna Sugars Finance Limited on June 25, 1990. The company was taken over by the India Cements Group and the name of the company was changed to India Cements Capital and Finance Limited on May 02, 1997 and again to India Cements Capital Limited on November 29, 2006. The Corporate Identification Number of the Company is L65191TN1985PLC012362. The Registered Office of ICCL is at “Dhun Building” 827, Anna Salai, Chennai –600 002 Tamil Nadu.

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Main Objects

The main objects of ICCL as per the Memorandum of Association, inter alia, include the following:

To carry on and undertake the business of financiers in all its branches and in particular, the business of financing industrial enterprises and acting as industrial consultants in all its branches and to subsidise, finance or assist in subsidizing or financing the sale and maintenance of any goods, articles or commodities of all and every kind and description upon any terms what so ever and to purchase or other wise deal in all forms of immovable and movable property including lands and buildings, plant and machinery, equipment ships, aircrafts, automobiles, computers and all consumers, commercial and industrial items and to lease or otherwise deal with them in any manner what so ever including resale thereof, whether they be new or old, financing operations and perform financing services including financing of projects, financing for exports and for imports, acceptance credit, invoice discounting, factoring invoices, debt collection, making of loans – both short term and long term with provision of financial software such as computer programme.”

Current Nature of Activities

The company is engaged primarily in the business of fee-based financial activity such as foreign exchange broking, money changing and stock broking as well as travel agency.

Board of Directors

As on date, the Board of Directors of India Cements Capital Limited consists of:

Sl. No. Name Designation DIN 1 Shri N. Srinivasan Chairman 00116726 2 Shri N. Srinivasan Director 00004195 3 Dr B.S. Adityan Director 00037717 4 Shri T.S. Raghupathy Director 00207220 5 Shri A. Sankarakrishnan Director 00054462

Details of Listing

Year of Initial Listing Name of the Stock Exchanges where currently Madras Stock Exchange Limited since 1993 listed Bombay Stock Exchange Limited since 1993 Ahmadabad Stock Exchange Limited since 1993 Listing Code Madras Stock Exchange Limited (Scrip Code: INDCEMCAP) Bombay Stock Exchange Limited (Scrip Code: 511355)

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Ahmadabad Stock Exchange Limited (Scrip Code: INDIACEMEN)

Shareholding Pattern as on December 31, 2010

Category of Shareholder No. of Total No. Total No. of Total Shares pledged Shareholders of Shares Shares held in Shareholding as a or otherwise Dematerialized % of total No. of encumbered Form Shares As a % As a % Number of As a% of of shares of (A+B) (A+B+C) Total No. of Shares (A) Shareholding of Promoter and Promoter Group

(1) Indian Bodies Corporate 5 18,576,840 - 85.58 85.58 18,576,840 100.00 Directors/Promoters & their 1 21,750 - 0.10 0.10 - - Relatives Sub Total 6 18,598,590 - 85.68 85.68 18,576,840 99.88 (2) Foreign Total shareholding of Promoter and 6 18,598,590 - 85.68 85.68 18,576,840 99.88 Promoter Group (A) (B) Public Shareholding

(1) Institutions Mutual Funds / UTI 1 600 - - - - - Sub Total (B)(1) 1 600 - - - - - (2) Non-Institutions Bodies Corporate 103 218,054 148,754 1.01 1.01 - - Individuals - - Individual shareholders holding 11,407 2,640,956 964,859 12.17 12.17 - - nominal share capital up to Rs. 1 lakh Individual shareholders holding 7 193,550 193,550 0.89 0.89 - - nominal share capital in excess of Rs. 1 lakh Others Clearing Members 5 4,350 4,350 0.02 0.02 - - Directors & their Relatives 4 7,600 - 0.04 0.04 - -

Non Resident Indians 12 3,323 3,323 0.02 0.02 - - Hindu Undivided Families 52 39,177 39,177 0.18 0.18 - - Sub Total (B)(2) 11,590 3,107,010 1,354,013 14.32 14.32 - - Total Public shareholding (B) 11,591 3,107,610 1,354,013 14.32 14.32 - - Total (A)+(B) 11,597 21,706,200 1,354,013 100.00 100.00 18,576,840 85.58

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(1) Promoter and Promoter Group ------(2) Public ------Sub Total ------Total (A)+(B)+(C) 11,597 21,706,200 1,354,013 - 100.00 18,576,840 85.58

The Company complies with provisions of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 1997 and SEBI (Prohibition of Insider Trading) Regulations 1992 and not defaulted with payment of listing fees to Stock Exchange. In accordance with the Securities Contracts (Regulation) (Second Amendment) Rules, 2010, ICCL shall comply with requirements of clause 40A of the Listing Agreement within three years of the said regulation being applicable.

Audited Financial Information

(Rs. In Lacs)

Year ending March 31, Particulars 2010 2009 2008 Paid up Equity Capital 2,170.62 2,170.62 2,170.62 Reserves and Surplus 1,261.99 1,196.48 1,196.48 Debit balance of P&L A/c 853.80 1,115.82 1,006.71 Net Worth 2,578.81 2,251.28 2,360.39 Sales / Income 996.70 535.14 794.58 Profit / (Loss) after tax 327.53 (109.11) 172.87 Earnings per equity share (Rs.) 1.51 (0.50) 0.80 Net Asset Value Per equity share 11.88 10.37 10.87 (Rs.)

The stock market data of ICCL at BSE is as under:

Month High (Rs.) Low (Rs.) No. of Shares Total Turnover Traded (Rs in Lacs) September 2010 21.30 14.20 1,13,988 19.65 October 2010 17.85 13.20 84,548 13.07 November 2010 16.15 12.20 16,977 2.32 December 2010 13.95 9.90 31,938 3.54 January 2011 11.19 8.50 17,218 1.82 February 2011 10.50 8.00 4,330 0.40 (Source: www.bseindia.com)

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Other Details:

Public or rights Issue in the preceding three years No Whether the company has become a sick company within No the meaning of the Sick Industrial Companies (Special Provisions) Act, 1995 or is under winding up Whether the company has made a loss in the immediately No preceding year There are no defaults in meeting any statutory/bank/institutional dues.

B. FINANCIAL INFORMATION THREE LARGEST UNLISTED GROUP COMPANIES: 3. Coromandel Sugars Limited (CSL)

Coromandel Sugars Limited was incorporated on May 22, 1996 at Chennai, Tamil Nadu. The Corporate Identification Number of the Company is U15421TN1996PLC035549. The registered office of CSL is at “Dhun Building” 827, Anna Salai, Chennai –600 002, Tamil Nadu.

Main Objects

The main objects of CSL as per the Memorandum of Association, inter alia, include the following:

“To carry on the business of manufacturers and refiners and dealers in sugar of all varieties and kinds and its by-products, distillers and spirit merchants and in the business of sugar boilers “

Current Nature of Activities

The company is engaged in the manufacture and sale of cane sugar, cane molasses and bagasse.

Board of Directors

As on date, the Board of Directors consists of:

Sl. No. Name Designation DIN 1 Shri N. Srinivasan Chairman 00116726 2 Shri R K Das Director 00327985 3 Shri T S Raghupathy Director 00207220 Shri M V Mohammed 4 Director 00271966 Meeran 5 Shri L Sabaretnam Director 00276882

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Shareholding Pattern as on December 31, 2010

Sl. No. Name of the Shareholders No. of Shares %age of Held Holding 1 ICL Securities Limited 3500000 24.99 2 ICL Financial Services Limited 3500000 24.99 3 The India Cements Limited 100 0.00 4. Sowdambika Finance & Investments Private Limited 3500000 24.99 5. Sivasunder Finance & Investments Private Limited 3500000 24.99 6. Trishul Investments Private Limited 1000 0.02 7. Individuals 600 0.02 Total 14001700 100.00

The brief standalone financials are given below:

(Rs in Lacs)

For the year ended March 31, Particulars 2010 2009 2008 Equity Share Capital 1400.17 1400.17 1400.17 Reserves & Surplus (excluding revaluation 1763.45 820.73 695.73 reserve) Net Worth* 3163.62 2220.9 2095.9 Sales/Income 14779.58 11547.80 7948.15 Profit / (Loss) After Tax 1658.44 80.45 (323.44) NAV per Equity Share of Rs. 10 (Rs.) 22.59 15.86 14.97 EPS of FV Rs. 10/- each 11.84 0.57 (2.31) *Net Worth does not include Advance for Share Capital of Rs. 1500.00 Lakhs.

Other Details: a. The company is neither a sick company within the meaning of the Sick Industrial Companies (Special Provisions) Act, 1985 nor is under winding up. b. There are no defaults in meeting any statutory/bank/institutional dues.

4. Coromandel Electric Company Limited (CECL)

CECL was incorporated on May 19, 1997 at Chennai, Tamil Nadu. The Corporate Identification Number of the Company is U45207TN1997PLC038219. The Registered Office of CECL is at “Dhun Building” 827, Anna Salai, Chennai –600 002, Tamil Nadu.

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Main Objects

The main objects of CECL as per the Memorandum of Association, inter alia, include the following:

“To carry on the business of generating power from conventional, non-conventional and renewable energy sources like Thermal, Hydel Gas, Wind, Ocean, Solar, Geo Thermal, Biomass, Diesel/Fuel Oil/ Liquid Naptha or by any other method and to accumulate, generate, purchase, distribute, supply, sell, electricity and other power (subject to and in accordance with law) for the purpose of light, heat, motive power and for all other purposes for which electric and other energy can be employed.”

Current Nature of Activities

The company is engaged in power generation.

Board of Directors

As on date, the Board of Directors consists of: Sl. No. Name Designation DIN 1 Shri N. Srinivasan Chairman 00116726 2 Ms. Rupa Gurunath Director 01711965 3 Shri PL Subramanian Director 00549992

Shareholding Pattern as on December 31, 2010

Sl. No. Name of the Shareholders No. of Shares %age of Held Holding 1 The India Cements Limited 140000 28.00 2 ICL Financial Services Limited 106000 21.20 3 Jubilee Cements Limited 124000 24.80 4 Trishul Investments Private Limited 130000 26.00 Total 500000 100.00

The brief financials are given below:

(Rs in Lacs)

For the year ended March 31, Particulars 2010 2009 2008 Equity Share Capital 50.00 50.00 50.00 Reserves & Surplus (excluding revaluation 1909.14 1463.49 1193.50 reserve) Sales/Income 4483.35 4541.73 3972.99

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Profit / Loss After Tax 842.33 666.67 757.38 Share Holders Funds / Net Worth 3,990.14 3,544.49 3,274.50 NAV per Equity share of FV Rs. 10/- each 391.83 302.70 248.70 EPS of FV Rs. 10/- each 90.18 55.05 73.19 Note: Shareholders’ Funds/Net Worth includes Preference Share capital of Rs. 2031 Lacs in each of the three financial years

Other Details:

The company is neither a sick company within the meaning of the Sick Industrial Companies (Special Provisions) Act, 1985 nor is under winding up.

There are no defaults in meeting any statutory/bank/institutional dues.

5. Coromandel Travels Limited (CTL)

CTL was incorporated on September 24, 2007 at Chennai, Tamil Nadu. The Corporate Identification Number of the Company is U63040TN2007PLC064854. The Registered Office of CTL is at “Dhun Building”, 827, Anna Salai, Chennai, Tamil Nadu.

Main Objects

The main objects of CTL as per the Memorandum of Association, inter alia, include the following:

To act as owners, charterers, hirers, lessors, lessees, agents of aircraft, luxury liner services, air taxi, helicopter, cargo and passenger ship, luxury liner, boat, railways, wagons, compartments, bus, omni-bus, car, truck, tram, vans, jeep, special utility vehicles, three wheelers and all other modes of conveyance and transport and to carry on business as agents for arranging air travel, aerial spraying, railways, shipping, bus, vehicles of all types and models, all other carriers, transporters, tourists and contractors and to organise inbound and outbound tours and travels, facilitate tourists, travelers, passengers and others by arranging circular tickets, sleeping cars or berths, reserved places, hotels, lodging, service apartments, baggage transport, guides, safe deposits and enquiry bureaus.

Current Nature of Activities

The company is engaged in air taxi operations.

Board of Directors

As on date, the Board of Directors consists of:

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Sl. No. Name Designation DIN 1 Ms Rupa Gurunath Chairperson 01711965 2 Mr B Gurunath Director 01712041 Meiyappan 3 Mr R Srinivasan Director 00207398 4 Mr V M Mohan Director 00921760

Shareholding Pattern as on December 31, 2010

Sl. No. Name of the Shareholders No. of Shares %age of Held Holding 1 The India Cements Limited 200000 10.00 2 ICL Financial Services Limited 395000 19.75 3 ICL Securities Limited 395000 19.75 4 Coromandel Sugars Limited 750000 37.50 5 India cements Capital Limited 250000 12.50 6 Individuals 10000 0.50 Total 2000000 100.00

The brief financials are given below:

(Rs in Lacs)

For the year ended March 31, Particulars 2010 2009 2008 Equity Share Capital 100.00 100.00 1.00 Reserves & Surplus - - - Debit balance of P&L A/c (1936.44) (850.97) (1.69) Share Holders Funds / Net Worth (1,836.44) (750.97) (0.69) Sales/Income 1,128.51 184.38 - Profit / Loss After Tax (1,085.47) (850.97) -

NAV per equity share of Rs. 10 each (Rs.) (183.64) (75.10) (6.88) EPS per equity share of Rs. 10 each (Rs.) (193.64) (86.74) -

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C. Details of Group Companies with negative Net Worth as on March 31, 2010: 6. ICL International Limited ICL International Limited (ICLI) was incorporated on 20.10.1993. The CIN of the company is U51909TN1993PLC026057. The registered office of ICLI is located at “Dhun Building”, 827, Anna Salai, Chennai, Tamil Nadu. ICLI is engaged in the business of trading including merchant exports and transportation. The current directors of ICLI are Shri N Srinivasan, Shri R K Das, Shri T S Raghupathy and Shri Ashwin Srinivasan.

The brief financials of ICLI are as follows: ((Rs. ‘000) For the year ended March 31, Particulars 2010 2009 2008 Equity Share Capital 500 500 500 Preference Share Capital - - - Reserves & Surplus (excluding revaluation - - - reserve) Debit Balance of Profit & Loss A/c 202,951 164,538 75,825 Misc. Expenses not written off - - - Sales/Income 17,464 33,465 108,455 Profit / Loss After Tax (38,413) (88,713) 10,070 Share Holders Funds / Net Worth (202,451) (164,038) (75,325) NAV per Equity share of FV Rs. 10/- each (4,049.02) (3,280.76) (1,506.50) (in Rs.) EPS of FV Rs. 10/- each (in Rs.) (768.26) (1,774.26) 201.40

7. Industrial Chemicals and Monomers Limited Industrial Chemicals and Monomers Limited (ICML) was incorporated on 09.08.1979. The CIN of the company is U24111TN1979PLC007911. The registered office of ICML is located at 145, Madurai Road, Sankar Nagar P O, Tirunelveli District, Tamil Nadu. ICML is engaged in the business of manufacture and sale of Calcium Carbide and the operations are currently suspended. The current directors of ICML are Shri R K Das, Shri T S Raghupathy and Shri R Srinivasan.

The brief financials of ICML are as follows: (Rs.) For the year ended March 31, Particulars 2010 2009 2008 Equity Share Capital 22,281,910 22,281,910 22,281,910 Preference Share Capital 500,000 500,000 500,000 Reserves & Surplus (excluding revaluation 451,562 451,562 451,562 reserve) Debit Balance of Profit & Loss A/c 129,178,466 127,506,742 125,557,707 Misc. Expenses not written off 22,087,605 22,087,605 22,087,605 Sales/Income 1,105 42,990 - Profit / Loss After Tax (1,671,724) (1,949,036) (4,547,819)

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Share Holders Funds / Net Worth (128,032,599) (126,360,875) (124,411,840) NAV per Equity share of FV Rs. 10/- each (57.68) (56.93) (56.06) EPS of FV Rs. 10/- each (0.75) (0.87) (2.04) Note: Shareholders’ Funds/Net Worth includes Preference Share capital of Rs. 5 Lacs in each of the three financial years but does not include Funds pending allotment of shares of Rs. 8,30,590.

8. Raasi Cement Limited

Raasi Cement Limited (RCL) was incorporated on 15.04.1978. The CIN of the company is U26942AP1978PLC002288. The registered office of RCL is located at White House, Block III B, 3rd floor, 6-3-1192/1/1, Kundanbagh, Begumpet, Hyderabad, Andhra Pradesh. RCL’s principal activities consisted of manufacturing and marketing cement. Consequent to the integration of the cement division of its plant with India Cements and the divestment of its other divisions, Raasi Cement has no manufacturing activities at present. The current directors of RCL are Shri N Srinivasan, Shri T S Raghupathy and Shri R K Das.

The brief financials of RCL are as follows: (Rs.) For the year ended March 31, Particulars 2010 2009 2008 Equity Share Capital 8,271,380 8,271,380 8,271,380 Preference Share Capital - - - Reserves & Surplus (excluding revaluation 3,000,000 3,000,000 3,000,000 reserve) Debit Balance of Profit & Loss A/c 24,124,060 24,055,363 22,244,473 Misc. Expenses not written off 52,977,319 52,977,319 52,977,319 Sales/Income - - - Profit / Loss After Tax (68,697) (1,810,890) (259,245) Share Holders Funds / Net Worth* (65,829,999) (65,761,302) (63,950,412) NAV per Equity share of FV Rs. 10/- each (79.59) (79.51) (77.32) EPS of FV Rs. 10/- each (0.08) (2.19) (0.31) *Net Worth does not include Advance for Share Capital of Rs. 970.00 Lakhs.

9. Unique Receivable Management Private Limited Unique Receivable Management Private Limited (URMPL) was incorporated on 08.02.2002. The CIN of the company is U67200TN2002PTC048428. The registered office of URMPL is located at “Dhun Building”, 827, Anna Salai, Chennai, Tamil Nadu. URMPL is engaged in the business of receivable collection. The current directors of URMPL are Shri N Srinivasan, Dr. B S Adityan, Shri T S Raghupathy and Shri N Srinivasan.

The brief financials of URMPL are as follows:

(Rs.)

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For the year ended March 31, Particulars 2010 2009 2008 Equity Share Capital 500,000 500,000 500,000 Preference Share Capital - - - Reserves & Surplus (excluding revaluation - - - reserve) Debit Balance of Profit & Loss A/c 734,275,108 705,266,405 442,508,189 Misc. Expenses not written off - - - Sales/Income 3,455,775 6,052,429 39,565,644 Profit / (Loss) After Tax (29,008,703) (262,758,216) (260,643,197) Share Holders Funds / Net Worth (733,775,108) (704,766,405) (442,008,189) NAV per Equity share of FV Rs. 10/- each (14,675.50) (14,095.33) (8,840.16) EPS of FV Rs. 10/- each (580.17) (5,255.16) (5,212.86)

10. ICL Shipping Limited

ICL Shipping Limited (ICLSL) was incorporated on 08.06.1995. The CIN of the company is U60222TN1995PLC031756. The registered office of ICLSL is located at “Dhun Building”, 827, Anna Salai, Chennai, Tamil Nadu. ICLSL was owning and engaged in the business of chartering of sea-going vessels and has no business activities since 2003. The current directors of ICLSL are Shri N Srinivasan, Shri T S Raghupathy and Shri R K Das.

The brief financials of ICLSL are as follows:

(Rs. ‘000)

For the year ended March 31, Particulars 2010 2009 2008 Equity Share Capital 500 500 500 Preference Share Capital - - - Reserves & Surplus (excluding revaluation - - - reserve) Debit Balance of Profit & Loss A/c 926,170 930,240 930,365 Misc. Expenses not written off - - - Sales/Income 5,517 81 100 Profit / Loss After Tax 4,070 125 (1,152) Share Holders Funds / Net Worth (925,670) (929,740) (929,865) NAV per Equity share of FV Rs. 10/- each (18,513.40) (18,594.80) (18,597.30) (in Rs.) EPS of FV Rs. 10/- each (in Rs.) 81.40 2.50 (23.04)

11. ICL Securities Limited

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ICL Securities Limited (ICLSec) was incorporated on 30.12.1994.The CIN of the company is U65993TN1994PLC029713. The registered office of ICLSec is located at “Dhun Building”, 827, Anna Salai, Chennai, Tamil Nadu. ICLSec is engaged in the business of Finance and Investments. The current directors of ICLSec are Shri N Srinivasan, Shri R K Das and Shri T S Raghupathy. The brief financials of ICLSec are as follows: (Rs. Lakhs) For the year ended March 31, Particulars 2010 2009 2008 Paid up Equity Share Capital 5.00 5.00 5.00 Less: Debit balance of Profit and Loss A/c 372.46 276.67 476.07 Net Worth* (367.46) (271.67) (471.07) Total Income 199.48 199.58 107.74 Profit after Tax (95.79) 199.40 107.65 EPS (Rs.) (191.58) 398.80 215.30 NAV per equity share (Rs.) (734.92) (543.34) (942.14) * Net Worth does not include Advance for Share Capital of Rs. 608.20 Lakhs D. Details of other group companies: 12. Trishul Concrete Products Limited

Trishul Concrete Products Limited (TCPL) was incorporated on 05.07.1999. The CIN of the company is U26956TN1999PLC042773. The registered office of TCPL is located at “Dhun Building”, 827, Anna Salai, Chennai, Tamil Nadu. TCPL is engaged in the business of manufacture and sale of ready mix concrete. The current directors of TCPL are Shri N Srinivasan, Shri T S Raghupathy and Shri Ashwin Srinivasan.

13. PT Coromandel Minerals Resources, Indonesia PT Coromandel Minerals Resources was incorporated on 23.01.2008. Its registered office is located at Menara Duta Building, 7th Floor, Wing B, JL.HR. Rasuna Said Kav. B-9, Jakarta- 12910, Indonesia. It is engaged in the business of general mining support services and trading. The current directors of PT Coromandel Minerals Resources are Shri R Krishnachander and Shri Sankaran Sundararaman.

14. Coromandel Minerals Pte. Ltd., Singapore Coromandel Minerals Pte. Ltd. was incorporated on 01.10.2009. Its registered office is located at 24, Raffles Place, # 18-00 Clifford Centre, Singapore-048621. It is engaged in the business of investments. The current and sole director of Coromandel Minerals Pte Ltd. is Shri Ajaib Hari Dass.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements included in this Draft Letter of Offer. The following discussion relates to our Company on a standalone basis, and, unless otherwise stated is based on our restated financial statements, which have been prepared in accordance with Indian GAAP, the accounting standards and other applicable provisions of the Companies Act, 1956, and SEBI (ICDR) Regulations. Our Financial year ends on March 31 of each year. This discussion contains forward-looking statements and reflects our current views with respect to future events and financial performance. Actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors such as those set forth in the sections "Forward-Looking Statements" and "Risk Factors" beginning on page ix and page x of this Draft Letter of Offer, respectively. This discussion and analysis of the audited financial statements for the six-months ended September 30, 2010 should not be read as an estimate or projection of full Fiscal Year 2011 results of operations.

Our Company has undergone a change in management control in the financial year 2009-10. Hence, detailed analysis of financial performance is not available with the current management for prior periods.

OVERVIEW

We are in the business of manufacturing and marketing of various types of cement. We have an operational cement plant with a capacity of 1.5 MTPA in Banswara, Rajasthan (“Plant”). We also have a long-term lease of 65.82 hectares of limestone mines (“Mine”). As a part of our Plant, we are in the process of constructing a 20 MW thermal power plant near our cement manufacturing plant.

We commenced commercial production of cement from our Plant in January 2011. Limestone, the key raw material used in the manufacture of cement, is obtained from our Mine, which is adjacent to our Plant location. We also have an agreement with India Cements for using their brand ‘Coromandel’ and their dealer network for the distribution and sale of cement manufactured by us. As a part of seed marketing initiative to develop our marketing network, in FY10 we have also purchased cement from India Cements, and sold it in our target markets.

As on January 31, 2011, our Company had 206 employees, out of which 62 employees were located at the marketing office and 144 employees were located at the Plant in Banswara.

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SIGNIFICANT DEVELOPMENTS SINCE SEPTEMBER 30, 2010

(i) Our Company commenced trial production of cement at the Plant in October 2010 and commercial production was commenced from January 2011. Accordingly, all expenditure (including interest payable) in relation to the Plant, incurred till January 31, 2011 shall be capitalized and all income or expenditure incurred post this date shall be accounted for in the Profit & Loss a/c. (ii) Further, as per the provisions of the Companies Act, Mr. Karan Vashisht was appointed as the Manager of our Company with effect from September 26, 2010. (iii) The Company has entered into a facility agreement with Yes Bank Limited on September 08, 2010 for working capital loans aggregating to Rs. 55 Cr., and Axis Bank Limited, vide sanction letter dated October 15, 2010 has sanctioned an amount aggregating to Rs. 55 Cr. for working capital loans. For further details, please see “Financial Indebtedness” on page 153 of the Draft Letter of Offer. (iv) Our Company has allotted 10,00,000 Non-convertible Redeemable Preference Shares of Rs. 100 each to India Cements at par on March 14 2010. For further details, please refer to the section titled “Capital Structure” on page 21 of the Draft Letter of Offer. (v) Consequent to approval from our shareholders, the name of our Company was changed from ‘Indo Zinc Limited’ to ‘Trinetra Cement Limited’ and a fresh certificate of incorporation was awarded to us on March 18, 2011. (vi) Our shareholders have consented to the shifting of our Registered Office from the state of Maharashtra to the state of Tamil Nadu through a special resolution passed through postal ballot, the results of which were declared on February 21, 2011. Accordingly, it is proposed to file an application with the Company Law Board to obtain the requisite approval for shifting of registered office.

Except as stated above, there are no subsequent developments after the date of the last balance sheet i.e. September 30, 2010, which we believe is expected to have a material impact on the reserves, profit, earnings per share and book value of our Company.

FACTORS AFFECTING OUR RESULTS OF OPERATIONS

We are a recent entrant in the business of production and marketing of cement. Our business, results of operations and financial condition are affected by a number of factors, some of which are beyond our control. This section sets out certain key factors that we believe have affected our business, results of operations and financial condition in the past or we expect will affect our business, results of operations or financial condition in the future. For a detailed discussion of certain factors that may adversely affect our business, results of operations and financial condition, see “Risk Factors” on page ix of this Draft Letter of Offer.

1. Growth of real estate and construction business

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We are in the business of manufacturing cement. Cement is primarily utilized in the construction of housing complexes and other civil infrastructure like roads, dams etc. The demand for cement is thus dependent on fresh investment incurred in such projects. Setting up new cement manufacturing capacity requires significant capital expenditure and time. Any surplus of demand over supply may result in increase in cement prices and thus higher realization for per unit of cement produced, thus increasing our future profits. Significant slowdown in demand, however, may result in lower dispatches and thus, lower revenues earned for our Company.

2. Availability of raw materials

Limestone is the primary raw material used in the production of cement. Our Company currently has mining rights for our Mine, located adjacent to our Plant. Limestone extracted from the Mine is currently sufficient for the requirement of limestone for our Plant. However, in case we are not able to extract the required quantities of limestone from the mine, then we may have to procure it from other sources. Further, we also source other raw materials like laterite, red ocher, yellow ocher, gypsum etc. from dealers and distributors located in Rajasthan or otherwise. Our profit margins, to a large extent, are dependent on the market prices of these commodities. Our coal requirement is currently met by imported coal. In case we are able to enter long-term agreements for purchase of coal, it may reduce our total cost of production, and thus increase our profitability.

3. Capacity utilization and fixed costs

Our Company has incurred significant investment on the construction of our Plant, which was primarily funded through loans obtained from various banks and financial institutions, and from India Cements. Our Plant commenced trial production of cement and in November 2010, December 2010 and January 2011, we have been able to utilize 23%, 35% and 55% of our total capacity. Commercial production has commenced only in January 2011 and we expect capacity utilization to improve over time. However, in case we are not able to exploit the manufacturing capabilities to the extent possible, it may result in lower production, lower revenues and thus a higher share of the fixed costs (interest payable, depreciation, administration costs) per unit of cement produced. Our profitability is thus dependent on these factors.

4. Seasonality

Demand for cement is seasonal as climatic conditions, particularly the monsoon, affect the level of activity in the construction industry. As a result, cement manufacturers experience a reduction in sales of cement during the monsoons, and somewhat stronger sales post monsoons. We expect our results of operations will continue to be affected

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by seasonality in the future. Our results of operations for any quarter in a given year may not, therefore, be comparable with other quarters in that year.

5. Competition

The cement industry in India is highly fragmented and competitive. Some of our competitors are larger than we are, may have more diversified, may have operations across India, may have greater financial resources, may have access to a cheaper cost of capital and may be able to produce cement more efficiently or to invest larger amounts of capital into their businesses. Our business could be adversely affected if we are unable to compete with our competitors and sell cement at comparable prices. For example, if any of our current or future competitors develop more efficient production facilities, enabling them to produce cement and clinker at a significantly lower cost and sell at lower prices than us, we may be required to lower the prices we charge for our products and our business and results of operations could be adversely impacted. Current and future competitors may also introduce new and more competitive products and supporting services, make strategic acquisitions or establish cooperative relationships among themselves or with third parties, including distributors of our products, thereby increasing their ability to address the needs of our target customers. For further details of competition in the cement business, please refer to the section “Our Business” on page 51 of the Draft Letter of Offer.

OUR SIGNIFICANT ACCOUNTING POLICIES

For Significant accounting policies please refer to ‘Significant Accounting Policies’ of the section titled ‘Financial Statements’ beginning on page 95 of this Draft Letter of Offer.

DISCUSSION OF OUR FINANCIAL PERFORMANCE

For the half year ended September 30, 2010

Sales:

Sales for the period were Rs. 671.05 Lakhs. During this period, our Plant was still under construction and no cement was manufactured. All revenue was derived from trading in cement purchased from India Cements. We engaged in trading of cement in order to develop relations with dealers of our target markets before commissioning of the Plant.

Other Income:

Other Income for the period was Rs. 4.85 Lakhs. This was primarily due to profit on sale of immovable property held by the Company.

Expenditure:

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Expenditure incurred during the period was Rs. 1001.42 lakhs, forming 149.23% of our Net Revenue. Most of this pertained to cost of goods traded and selling and distribution expenditure. Cost of goods traded during the period amounted to Rs. 849.41 Lakhs, forming 84.82% of the total expenditure for the period. Selling and distribution expenditure amounted to Rs. 117.82 Lakhs, forming 11.76% of the total expenditure.

Profit/Loss:

The Net Loss for the period stood at Rs. 263.99 Lakhs, representing loss mainly accounting out of trading of cement, which has been carried out as seed marketing initiative, prior to commissioning of the Plant.

Tax:

Since our Company made a loss during the period, no tax was provided for.

Fiscal 2010 compared to Fiscal 2009

Sales:

The Sales for FY10 were Rs. 6.73 Lakhs as compared to Rs. 75.11 Lakhs for FY09, a decrease of 91.04%.

Other Income:

Other Income stood at Rs. 88.87 Lakhs in FY10 as compared to Rs. 27.37 Lakhs in FY09, an increase of 224.70%. This was due to profit on sale of fixed asset, which amounted to Rs. 81.52 Lakhs.

Expenditure:

Expenditure for FY10 stood at Rs. 27.28 Lakhs as compared to Rs. 616.55 Lakhs in FY09, a decrease of 95.58%. This was primarily due to a non-recurring expenditure – provision for bad and doubtful debts / bad debts incurred on advances made, during FY09, which amounted to Rs. 492.59 Lakhs. Due to reduction in trading activity, the cost of traded goods reduced to Rs. 9.30 Lakhs in FY10 as compared to Rs. 23.11 Lakhs in FY09. Also, Other Operating expenses reduced to Rs. 4.01 Lakhs during FY10 from Rs. 66.67 Lakhs during FY09.

Net Profit/Loss before Tax and extraordinary items:

The Net Profit before tax and extraordinary items for FY10 was Rs. 67.75 Lakhs as compared to a Net Loss before tax and extraordinary items of Rs. 580.20 Lakhs for FY09.

Tax:

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The tax payable in FY10 was Rs. 10.31 Lakhs, as compared to Rs. 3.80 Lakhs in FY09. The tax payable in FY10 related to income tax for earlier year (1994-95), which was paid during FY10.

Extra-ordinary items:

There were no extraordinary items during FY10.

Net Profit/Loss after extra-ordinary items:

The Net Profit after extra-ordinary items stood at Rs. 57.44 Lakhs in FY10, as compared to a Net Loss after extra-ordinary items of Rs. 518.85 Lakhs in FY09.

Fiscal 2009 compared to Fiscal 2008

Sales:

The Sales for FY09 were Rs. 75.11 Lakhs as compared to Rs. 282.35 Lakhs for FY08, a decrease of 73.40%.

Other Income:

Other Income stood at Rs. 27.37 Lakhs in FY09 as compared to Rs. 21.73 Lakhs in FY08, an increase of 25.95%. This was due to write-back of excess provision provided for and no longer required, which stood at Rs. 22.73 Lakhs in FY09, as compared to Rs. 14.08 Lakhs in FY08.

Expenditure:

Expenditure for FY09 stood at Rs. 616.55 Lakhs as compared to Rs. 535.25 Lakhs in FY08, an increase of 15.19%. During FY09, there was a non-recurring expenditure – provision for bad and doubtful debts / bad debts incurred on advances made, during FY09, which amounted to Rs. 492.59 Lakhs. However, due to reduction in trading activity, the cost of traded goods reduced to Rs. 23.11 Lakhs in FY09 as compared to Rs. 217.10 Lakhs in FY08, a decrease of 89.36%. Other operating expenses increased from Rs. 38.27 Lakhs in FY08 to Rs. 66.67 Lakhs in FY09, an increase of 74.21%.

Net Profit/Loss before Tax and extraordinary items:

The Net Loss before tax and extraordinary items for FY09 was Rs. 580.20 Lakhs as compared to Rs. 291.94 Lakhs for FY09, an increase of 98.74%.

Tax:

The tax payable in FY09 was Rs. 3.80 Lakhs, as compared to Rs. 0.29 Lakhs in FY08. In both these years, tax payable pertained to Fringe Benefit Tax payable.

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Extra-ordinary items:

During FY09, there was an income of Rs. 65.16 Lakhs due to extraordinary items.

Net Profit/Loss after extra-ordinary items:

The Company incurred a Net Loss after extra-ordinary items of Rs. 518.85 Lakhs in FY09, as compared to a Net Profit after extra-ordinary items of Rs. 234.67 Lakhs in FY08.

Fiscal 2008 compared to Fiscal 2007

Sales:

The Sales for FY08 were Rs. 282.35 Lakhs as compared to Rs. 205.88 Lakhs for FY07, an increase of 37.14%.

Other Income:

Other Income stood at Rs. 21.73 Lakhs in FY08 as compared to Rs. 2.84 Lakhs in FY07, an increase of 665.14%. This was due to write-back of excess provision provided for and no longer required, which stood at Rs. 14.08 Lakhs in FY08, as compared to Rs. 0.37 Lakhs in FY07.

Expenditure:

Expenditure for FY08 stood at Rs. 535.25 Lakhs as compared to Rs. 276.57 Lakhs in FY07, an increase of 93.53%. This increase was primarily due to material non-recurring expenditure incurred in FY08, including bad debt of Rs. 70.37 Lakhs, Loss in value of stock due to deterioration of Rs. 141.91 Lakhs and expenses related to abandoned Banswara plant amounting to Rs. 10.68 Lakhs against Rs. 8.21 Lakhs in FY07.

Net Profit/Loss before Tax and extraordinary items:

The Net Loss before tax and extraordinary items for FY08 was Rs. 291.94 Lakhs as compared to Rs. 33.23 Lakhs for FY09, an increase of 778.54%.

Tax:

The tax payable in FY08 was Rs. 0.29 Lakhs, as compared to Rs. 0.51 Lakhs in FY07. In both these years, tax payable pertained to Fringe Benefit Tax payable.

Extra-ordinary items:

During FY08, there was an income of Rs. 526.90 Lakhs due to extraordinary items.

Net Profit/Loss after extra-ordinary items:

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The Company incurred a Net Profit after extra-ordinary items of Rs. 234.67 Lakhs in FY08, as compared to a Net Loss after extra-ordinary items of Rs. 33.74 Lakhs in FY07. This was primarily due to extraordinary income earned during the year.

Indebtedness

The total borrowing of the Company as on September 30, 2010 was Rs. 77978.68 Lakhs. Total borrowings consisted of Rs. 19093.75 Lakhs of Secured Loans obtained from banks and financial institutions, and unsecured loans outstanding of Rs. 58,884.93 Lakhs from India Cements. For further details of our borrowings, please refer to the section titled “Financial Indebtedness” on page 153 of the Draft Letter of Offer.

Contingent Liabilities

Contingent Liabilities as on September 30, 2010 was Rs. 16071 Lakhs, due to unexecuted capital commitments pertaining to machinery to be purchased for our plant, pending at the reported time.

Significant dependence on a single or few suppliers or customers

We depend, to a large extent, on the technical expertise and marketing network of our ultimate promoter, India Cements. Except this, our Company does not have a significant dependence on a single or few suppliers or customers.

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Working results of the Company:

The unaudited working results of the Company for the period October 01, 2010 to December 31, 2010 in accordance with circular no. F2/5/SE/76 dated March 8, 1977 issued by the Ministry of Finance is as follows:

Sr. Particulars Amount (In Rs. Lakhs) No. 1 Total Sales/ Turnover 723.59 2 Other Income 0.00 3 Total Income 723.59 4 Profit/ (Loss) before Interest, Taxes, Depreciation and (408.92) Amortization 5 Interest and other charges (net) 6.57 6 Provision for depreciation 1.63 7 Provision for tax 0.00 8 Profit after Tax (417.12)

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STOCK MARKET DATA FOR EQUITY SHARES OF THE COMPANY

The Company’s Equity Shares are listed on the BSE, ASE, MPSE and DSE under ISIN ‘INE031L01014’. However, the Company’s Equity Shares are traded only on the BSE, and are currently suspended from trading in ASE, MPSE and DSE. Our Company proposes to delist its Equity Shares from ASE, MPSE and DSE. The Securities offered pursuant to the Issue are proposed to be listed only on the BSE.

BSE resumed trading of the Equity Shares of the Company with effect from November 04, 2010 vide notice dated October 29, 2010. Hence, no trading information can be provided for prior periods.

The high and low prices and volume of Equity Shares traded on the respective dates during the last 3 months is as follows:

BSE

Month, Year High Date of Volume Low Date of Low Volume (Rs.) High on date (Rs.) on date of high of low (no. of (no. of shares) shares)

February 2011 27.35 01/02/2011 100 21.55 11/02/2011 1800 January 2011 45.70 03/01/2011 100 27.10 28/01/2011 3300 December 2010 65.20 09/12/2010 100 48.10 31/12/2010 100 Source: www.bseindia.com

Week end prices of the Equity Shares of the Company for the last four weeks on the BSE is as below:

Week Ended on Closing Rate BSE (Rs.) March 25, 2011 29.95 March 18, 2011 30.20 March 11, 2011 25.25 March 04, 2011 21.90 Source: www.bseindia.com

Highest and Lowest closing price of the Equity Share of the Company on BSE for the last four weeks:

Highest (Rs.) Date Lowest (Rs.) Date BSE* 32.60 22/03/2011 21.90 04/03/2011 *www.bseindia.com

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The Issue was approved by our Directors in the meeting held on Friday, November 12, 2010. The closing price of Equity Shares on the BSE on Monday, November 15, 2010 was Rs. 66.18 and the no. of Equity Shares traded was 100.

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FINANCIAL INDEBTEDNESS The details of the Company’s secured and unsecured loans as on January 31, 2011, are as follows:

Sl Name of Nature of Amount Amount Rate of Repayment Security No Lender Borrowing Sanctioned outstanding Interest as on 31/01/2011 1 Yes Bank Ltd Secured Rs.85 Cr. Rs.85 Cr. 10.72% 28 Quarterly Mortgage of immovable property, Term Loan currently instalments present or future relating to Banswara (readjusted starting from 1st Plant, including thermal power plant periodically) Oct,2011 2 Working Fund Nil Yes Bank Base To be repaid on First pari passu charge on all current Capital Based: Rs. Rate plus demand assets of the cement project at Loan 17 Cr. 3.50% Banswara Non-Fund (10.50% Second pari passu charge on all fixed based: Rs. currently) assets of the cement project at 38 Cr. Banswara

3 Axis Bank Secured Rs.75 Cr. Rs.30.62 Cr. 10.72% 28 Quarterly Mortgage of immovable property, Term Loan currently instalments present or future relating to Banswara (readjusted starting from 1st Plant, including thermal power plant periodically) Oct,2011 4 Working Fund Nil Axis Bank Base To be repaid on First pari passu charge on all current Capital Based: Rs. Rate + 2.75% demand assets of the cement project at Loan 25 Cr. p.a. Banswara Non-Fund (11.00% Second pari passu charge on all fixed based: Rs. currently) assets of the cement project at 30 Cr. Banswara Goods procured under LC (for non-fund based only 5 Infrastructure Secured Rs.80 Cr. Rs.80 Cr. 10.72% 28 Quarterly Mortgage of immovable property, Development Term Loan currently instalments present or future relating to Banswara

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Sl Name of Nature of Amount Amount Rate of Repayment Security No Lender Borrowing Sanctioned outstanding Interest as on 31/01/2011 Finance (readjusted starting from 1st Plant, including thermal power plant Company periodically) Oct,2011 Limited 6 UCO Bank Secured Rs.60 Cr. Rs.50 Cr. 10.72% 28 Quarterly Mortgage of immovable property, Term Loan currently instalments present or future relating to Banswara (readjusted starting from 1st Plant, including thermal power plant periodically) Oct,2011 7 The India Unsecured N/A Rs. 591.66 Nil To be repaid on N/A Cements loan Cr. demand Limited (including interest)

Major Restrictive Covenants of the Secured Term Loan from Axis Bank Limited, Yes Bank Limited, UCO Bank and Infrastructure Development Finance Company Limited:

I. Undertaking from India Cements for meeting any over-run or shortfall in the resources of our Company for completing the Project and for working capital requirements II. Management Control a. India Cements/ICLFSL shall maintain at least 51% shareholding in our Company b. India Cements /ICLFSL shall maintain management control and majority representation on the Board of Directors c. Repayment, redemption of loan obtained from India Cements/ICLFSL permitted only upon approval of lenders III. Financial Covenants a. Maintain total outstanding liabilities/total net worth of less than 1.25 b. Maintain total outstanding liabilities/EBIDTA of less than 4 c. Maintain DSCR of greater than 1.33

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SECTION VI- LEGAL AND OTHER INFORMATION

OUTSTANDING LITIGATIONS AND MATERIAL DEVELOPMENTS Except as described below, there are no outstanding litigations, suits or criminal or civil prosecutions, proceedings or tax liabilities against the Company, our Promoters or Promoter Group companies or against any other company whose outcome could have a materially adverse effect on the business, operations or financial position of our Company and there are no defaults, non-payment of statutory dues, over dues to banks/ financial institutions, defaults against banks/ financial institutions/ small scale undertaking(s), 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).

Our Company, our Directors and Companies in which our Directors are associated as directors, our Promoters and Promoter Group have not been prohibited from accessing or operating in capital markets under any order or direction passed by SEBI and have not been detained as wilful defaulters by the RBI or any government authority and there have been no violation of securities laws in the past or pending against them.

The disclosures in relation to the Promoters and the Promoter Group Companies are based on the information provided by the respective companies

Contingent liabilities of the Company

For information in relation to the contingent liabilities of the Company as at September 30, 2010, see the section “Financial Statements - Contingent Liabilities as at September 30, 2010” on page [] of this DLOF.

Litigation By or Against the Company

There is no pending litigation filed by or against our Company.

Proceedings Initiated/ Pending against our Company for Economic Offences

There are no proceedings initiated against our Company for any economic offences.

Details of Past Penalties Imposed on our Company

There are no past penalties imposed on our Company.

Material developments since the last Balance Sheet Date

Except as disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on page 142, in the opinion of our Board, there have not arisen, since the date of the last financial statements disclosed in this Draft Letter of Offer, any circumstances that materially or adversely affect or are likely to affect our Company as a whole or the value of our total assets or ability to pay our material liabilities within the next 12 months.

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Litigation involving the Directors of the Company

There is no pending litigation filed by or against any of our Directors.

Litigation involving the Promoters

1. ICL Financial Services Limited Nil

2. The India Cements Limited The India Cements Limited is involved in various legal proceedings in their ordinary course of business. The nature of legal proceedings in which the India Cements Limited is involved includes, inter alia, civil cases including contractual disputes in relation to their business, money suits, title suits, eviction suits and other disputes related to properties, payment of royalty; cases for termination of employees, non-payment of dues and other industrial disputes; various tax related proceedings relating to non-payment, disallowances of exemption and deductions from excise duty, sales tax, service tax, value added tax, income tax and other state and local taxes and levies and notices received from the MRTP Commission. These matters are pending before various forums at different stages of adjudication.

Although the outcome of these legal proceedings are uncertain, the Company does not expect that an adverse outcome in any of these proceedings will have a material adverse effect on the Company‘s business, results of operations, financial condition and prospects.

The details of the material litigations involving the India Cements Limited are as stated below.

Material Litigation against the India Cements Limited:

1. A special leave petition (SLP No. 7273 of 2007) has been filed by the Government of Tamil Nadu against the India Cements Limited before the Hon’ble Supreme Court of India. The India Cements Limited established a new industrial unit at Dalavoi Village, Sendurai Taluk, Perambalur Dist which went into commercial production during 1997. The Government of Tamil Nadu vide G.O. No. 92 Commercial Taxes and Religious Endowment Dept. dated 22.2.1991 directed that sales tax deferral be given for new industries as well as existing industries for a period of 12 years upon fulfilling certain conditions. In accordance with the said G.O., the India Cements Limited was eligible for availing the benefit during the period 1.7.1997 to 31.5.2009 and had been availing the same from the year 1997-1998 immediately on reaching either the Base Sale Volume (BSV) or Base Production Volume (BPV). The sales tax authorities however issued notice and contended that as per the eligibility certificate, the India Cements Limited will be entitled to avail the deferral only upon reaching both BSV and BPV and thus demanded alleged arrears for a sum of Rs. 5873.51 lakhs for the period 1997-1998 to 2000-2001. The Petition filed by the India Cements Limited before the Tamil Nadu Taxation Special Tribunal was dismissed against which the India Cements Limited filed writ petition before the Hon’ble High Court, Madras. The High Court vide order dated 22.12.2006 held in favour of the Company that the benefit of deferral of sales tax for the sales made in excess of the Base Sales volume cannot be denied to the holder of the Eligibility

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Certificate if the actual production of the industry in any financial year during the period of deferral exceeds the Base Production volume. The Government has appealed before the Supreme Court against the order of the High Court. The matter is currently pending.

2. A writ petition (W.P. No. 9123 of 2007) has been filed by Joint Sub –Registrar, Registration Department against the India Cements Limited before the Hon’ble High Court, Andhra Pradesh. The India Cements Limited was the successful bidder for land owned by Cement Corporation of India Limited pursuant to a scheme sanctioned by Board for Industrial and Financial Reconstruction and sale deed was executed in favour of the India Cements Limited and presented for registration on 21.01.1998 after valuing the land and buildings at Rs.50.04 crores. The District Registrar determined the market value of the property covered by the instrument at Rs.198.85 crores which was the consideration paid by the India Cements Limited for both movable and immovable properties and raised a demand for the payment of the deficit stamp duty of Rs. 16,14,88,470/- and registration fee of Rs.70,40,385/-. The India Cements Limited challenged the levy before the Sub-Court, Prodattur which held in favour of the India Cements Limited stating that stamp duty cannot be levied on plant and machinery and other movables. The Joint Sub-Registrar has challenged the said order before the Hon’ble High Court, Andhra Pradesh and the matter is currently pending.

3. The Andhra Pradesh Electricity Regulatory Commission approved the proposal of the AP Transco to levy grid support charges where the parallel operation of captive power plants was permitted, on the difference between the total capacity of captive power plants in Kilo Volt Ampere and the contracted maximum demand in KVA with the licensee and all other sources of supply, at a rate equal to 50% of the prevailing demand charge for HT consumers ( which was Rs.170/ per Kilo Volt Ampere/month then). In case of captive power plants exporting firm power to AP Transco the capacity which is dedicated to such export, will also be additionally subtracted from the captive power plant capacity. The order came into force from March 2002. The above order of APERC was challenged by the India Cements Limited along with similarly placed industries before the High Court of Andra Pradesh. The High Court during May 2003 was pleased allowed the appeal and set aside the order of Andhra Pradesh Electricity Regulatory Commission. Challenging the said order of the High Court the AP Transco has filed a special leave petition No. SLP 8977 of 2003 before Supreme Court challenging the order of the High Court. The Supreme Court after notice to the consumers refused to stay the order of the High Court but has permitted the AP Transco to retain the amount already collected by them. The matter is currently pending.

4. A special leave petition (S.L.P.5082/2003) has been filed by A.P.Transco challening the order of the Hon’ble High Court of Andhra Pradesh allowing an appeal by the India Cements Limited against the enhancement of the Wheeling charges. The above SLP is still pending before the Hon’ble Supreme Court.

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5. A Writ Petition (WP No. 1813 of 2007) has been filed before the High Court of Andhra Pradesh by Lok Cement challenging the grant of mining lease to the India Cements Limited at Chilamkur village, Kadapa District. Interim orders have been granted in the matter. The matter is currently pending.

Material Litigation filed by the Indian Cements Limited:-

1. The India Cements Limited has filed writ petitions (WP No. 14841 and 14842 of 2002) before the Hon’ble High Court, Madras challenging order passed by the Director of Geology & Mining, Chennai. In March 2002, the Director of Geology & Mining, Chennai called for details relating to limestone production from captive mines and limestone procured from other sources and consumed in the factory, details of royalty paid thereon and cement production details for the period 1988-1999. Based on the details of production of cement furnished by the India Cements Limited, the Director computed that there was a short payment of royalty on the limestone consumed for producing the said quantity of cement to the extent of Rs.9,44,22,875/- in relation to Sankari plant at Salem and Rs.21,81,72,863/- in relation to Sankarnagar plant at Tirunelveli. The authorities had made a demand applying a conversion ratio of 1.5 ton of limestone for 1 ton of cement. The demand was challenged by the India Cements Limited on the ground that there was no basis for the conversion ration applied by the authorities as cement as a final product contains other raw materials other than limestone and further the actual computation in arriving at the demand was not furnished by the authorities. The High Court vide order dated 29.04.2002 has granted interim stay of the demand in favour of the India Cements Limited and the matter is presently pending.

2. The India Cements Limited has filed special leave petition (SLP No. 962 of 2008) before the Hon’ble Supreme Court of India against order passed by the MRTP Commission. The Director General (Investigation & Registration) had filed a Restrictive Trade Practices Enquiry Report before the MRTP Commission on September 1990 on the basis of the data of the price of Cement for the period from February 1990 to August 1990. It is alleged in the report that the prices of cement have been increased by the Manufacturers irrespective of fact whether there is shortage of cement in a particular region or the region is surplus in cement production and that the price of cement have been increased at short intervals from time to time without any corresponding increase in the cost of production, after hearing, MRTP Commission, New Delhi on 20/12/2007, has Ordered Cease & Desist, against which the India Cements has filed the case. The Hon’ble Supreme Court has stayed the Order of the MRTP Commission and the same is pending.

3. A special leave petition (SLP 1565 of 2009) has been filed by Tamil Nadu Electricity Board and the India Cements Limited against order of division bench of the Madras High Court in the matter stated herein. A single Judge held that the agreement with Tamil Nadu Electricity Board for supply of fly ash is not a statutory one and the board has the power to vary or alter the same. The same was challenged by the one of the allottees, ACC and the appeal was allowed by a division bench against which Tamil Nadu

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Electricity Board and the India Cements Limited have preferred the special leave petition.

4. A demand for arrears of water charges to the extent of Rs.2.28 crores was made by the Superintending Engineer, Tamirabarani Basin Division on the basis of maximum permissible quantity of 2 Cusecs. The same was challenged before the Madras High Court on the ground that the India Cements Limited is liable to pay only for the quantity actually consumed. A single judge of the High Court held in favour of the India Cements Limited. The government appealed against the said order and a division bench of the Madras High Court held in favour of the Government. Against the said order, a SLP was filed before the Supreme Court by the Company. The Supreme Court while disposing off the appeal was pleased to allow the Company`s appeal, set aside the order of the High Court in the writ appeal and has remitted the matter for fresh disposal of the writ appeal by the High Court since the write appeal was decided in the absence of both parties by the High Court. In the interim, the Government has revived their demand for arrears of water charges worked on the basis of the maximum demand which have been challenged by the India Cements limited. The writ appeal along with similar matters is pending before the Division Bench of the High Court.

5. A writ petition (WP No. 6706 of 2006) has been filed before the High Court, Madras to call for the records of the District Collector, Tirunelveli made in his proceedings M2/28230/05 dated 20.5.05 and quash the same and consequently direct the respondents to calculate and collect the stamp duty for execution and registration of the lease deed in form K of the mineral conservation rules 1960 for the lands of the petitioner over an extent of 28.43.0 hectares in Ramayanpatti village Tirunelveli taluk and district for which mining operations are carried on based only on the dead rent fixed on the ground that the incidence of stamp duty under the stamp Act is rent and the royalty being tax on mineral cannot be equated to rent and stamp duty could only be calculated on the basis of dead rent. The High Court has granted interim stay of the order of the Collector subject to the payment of the stamp duty based only on dead rent on 14.9.2005. However, the India Cements Limited has paid the stamp duty on the mining lease as calculated by the department and the same has been executed. The matter is presently pending.

6. The India Cements Limited has filed a writ petition (W.P.No.21518 of 2007) before the High Court, Madras challenging a demand of a sum of Rs.1,09,75,902/- being the lease rent along with interest for the period from 1989-2005 towards lease rent for Thalaiyuthu Reserve Forest Mining lands . The writ has been filed on the ground that the India Cements Limited having already surrendered an equal extent of non forest land to the Forest Department and also having paid the amount towards the cost of afforestation, is not liable to pay a further sum of lease rental, as these lands are governed by the mining lease granted by the Union of India and is governed by the MMDR Act, and that the demand is based on an audit objection cannot be sustained and a G.O. issued during 1991 cannot be retrospective, apart from other grounds. The Writ Petition has been admitted by the Hon’ble High Court and we have been directed

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to deposit 50% of the demand and furnish a bank guarantee for the balance 50% of the demand in order to obtain transport permits. All further proceedings have been stayed. The writ petition is still pending.

7. The India Cements Limited has filed a writ petition (W.P 18906 of 2009) before the High Court, Madras challenging decision of the Director General, BIS to implement gradation of PPC and PSC. The writ challenging the amendment to the Indian Standar Specifications has been filed on the ground that the said proposed amendments is done on malafide considerations as certain important factors such as availability of desired raw materials, technological capability of different segments have not been considered. The writ petition has been admitted and the respondent has been directed to maintain status quo in so far as it relates to implementation. The matter is currently pending.

8. A claim for a sum of Rs. 70 crores being the amounts due and payable by SVCL to the India Cements Limited under a marketing agreement has been filed before Justice Nanavathi, a retired Judge of the Supreme Court, appointed as an arbitrator by the Madras High Court on an application filed by the India Cements Limited. In the meanwhile, the India Cements Limited also filed an application to refer the dispute on the above claim based on the share purchase agreement also for arbitration, and the same was also referred to Justice Nanavathi. The matter has been argued and the award is awaited.

9. The India Cements Limited had been availing the credit of duty paid on HSD oil used for captive power generation at its cement plants as per the provisions governing CENVAT. However, the claim of the India Cements Limited was not accepted by the government. The matter was finally settled before the Supreme Court which held that the India Cements Limited was entitled for the CENVAT credit on HSD oil used for captive power generation. While so, the Government by Section 112 of the Finance Act 2000-2001 carried out certain amendments which denied the benefit to the India Cements Limited. The said amendments have been challenged by the India Cements Limited before the High Court of Madras (W.P No.12339 of 2000) and before the High Court of Andhra Pradesh (W.P. 2423 of 2004). The India Cements Limited has also filed appeal before the Madras High Court (CMA No.312 of 2010) challenging the order of the CESTAT denying the credit which has been tagged along with the writ petition. The total demand made in the matters is Rs. 2.60 crores. The matters would be listed for final disposal shortly.

10. The Government of Andhra Pradesh enacted the Mineral Bearing lands (Infrastructure) Cess Act imposing cess on mineral bearing lands for the promotion of infrastructure facilities for rapid exploitation of mineral resources in the state which came into force on 12th September 2005. By the said Act cess at the rate of Rs.3/ per tonne of limestone/lime kankar/lime shell and at Rs.20 per tonne of coal has been imposed. The levy of the cess has been challenged by the India Cements Limited along with other cement industries in Andhra Pradesh by way of a writ petition (W.P. 3099 of 2006). No interim orders have been granted in the matter. However, the writ petition has been

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admitted with an observation that the cess collected during the pendency of the writ petition will remain subject to the final decision of the court. The matter is currently pending.

11. The India Cements Limited is one of the shareholders of APGPCL and has been drawing power generated by APGPCL as a shareholder and utilising the same at its cement plants. Further, the India Cements Limited is also drawing surplus power generated under Stage-II available from APGPCL as per the terms of MOU-II entered between the shareholders. During the month of April 2004, APTRANSCO raised a dispute that the India Cements Limited is not entitled for the surplus power generated by APGPCL started billing as per their tariff for the surplus supplied by APGPCL to the India Cements Limited. A writ petition (No.9165/2004) was filed challenging the same and the said writ was disposed off by the single Judge of High Court of Andhra Pradesh High court holding that the surplus power allotted and supplied to the share holders is valid but in the absence of any agreement on the fixation of price the same cannot be levied at the choice of A.P.Transco but should be determined between A.P.Transco and the consumers after notice to the parties. The India Cements Limited has filed a Writ Appeal No. 2157/2004 before a Division Bench of the Andhra Pradesh High Court challenging the said order. The High Court has admitted the appeal and granted interim stay of collection of disputed amount. The matter is currently pending.

12. The India Cements Limited has filed a writ petition (W.P.No.7374 of 2004) before the Hon’ble High Court of Andhra Pradesh challenging the amendment to the Andhra Pradesh Electricity Duty Act under which 25 paisa per unit of energy generated and consumed by captive power plant was imposed. Interim orders staying the demand have been granted in favour of the India Cements Limited. The matter is currently pending.

13. The India Cements Limited has filed writ petition (WP No. 11784 of 2010) before the High Court of Andhra Pradesh against disconnection notice issued by APCPDCL. The amount involved is Rs.1.70 crores. The matter is currently pending.

14. The India Cements Limited has filed two writ petitions (W.P.Nos.20128 of 2005 & 17159 of 2008 ) before the High Court of Andhra Pradesh challenging the proceedings of the Corporation of Hyderabad proposing acquisition of lands over which the office building of the India Cements Limited is situated for the purpose of widening of the road. The Hon’ble High Court while admitting the Writ Petitions has granted stay of demolition. The writ petitions are currently pending.

Potential Litigation

1. MRTP Commission had issued Notice to the India Cements Limited on the basis of a Preliminary Investigation Report filed by the Director General (Investigation &

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Registration) on basis of a press report by Economic Times dated 05/05/2006. It is alleged in the report that the Cement Manufacturing Companies by forming a cartel have exorbitantly increased the prices of cement during the year 2005 -2006. The company has filed there objections and the same is pending.

In addition to the aforesaid, the details of various litigations involving the India Cements Limited is as follows:

1. In Tamil Nadu, the India Cements Limited has filed a number of civil suits in various sub- courts across Tamil Nadu and before the Hon’ble High Court, Madras for recovery of amounts aggregating to approximately Rs.16,51,700. The India Cements Limited has filed 57 criminal cases before various magistrate courts in tamil Nadu under section 138 of the Negotiable Instruments Act for dishonor of cheques made in favour of the Company. The amount involved in such cases is approximately Rs. 1,59,46,428.

2. In relation to the plant at Sankari Nagar, seventeen litigations are pending before the High Court/ CESTAT concerning central excise matters. The amount involved is Rs. 2,93,21,970. Seven litigations are pending before the CESTAT/ other authorities concerning service tax matters. The amount involved is Rs. 47,30,60,87.80.

3. In relation to the plant of Dalavoi, there are 49 litigations/ appeals pending before the High Court/ Department/CESTAT concerning central excise matters. The amount involved in Rs. 34,06,43,169.

4. In relation to the plant at Chilamkur, there are a number of litigations/ appeals pending before the High Court/ Department/CESTAT concerning central excise matters. The amount involved is Rs. 8,02,15,746.

5. There are also various income tax proceedings pending against the India Cement Limited which proceedings are pending at various stages. There are also various sales tax proceedings involving the India Cements Limited aggregating to Rs.7,09,11,000.

6. There are also proceedings relating to Raasi Cement Limited which was taken over by the India Cements Limited. The total amount involved in relation to income tax matters is Rs. 11,79,79,000. There are also various sales tax proceedings involving Raasi Cement Limited aggregating to Rs.10,65,84,000.

7. In Karnataka, the India Cements Limited has filed a number of civil suits in various sub- courts across Karnataka for recovery of amounts aggregating to approximately Rs.73 lakhs. The India Cements Limited has filed 9 criminal cases before various magistrate courts in Karnataka under section 138 of the Negotiable Instruments Act for dishonor of cheques made in favour of the Company.

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8. In Andhra Pradesh, the India Cements Limited has filed 36 criminal cases before various magistrate courts in Andhra Pradesh under section 138 of the Negotiable Instruments Act for dishonor of cheques made in favour of the Company. The amount involved is approximately Rs. 1,73,29,763. The India Cements Limited has filed 8 civil suits pending before different courts in Andhra Pradesh for recovery of amounts aggregating to approximately Rs.37, 39,846.

9. There are several cases filed by the state governments through factory inspectors, certain previous and present employees, workmen and their legal heirs, before various forums, against the Company, it officers and Directors. These cases are in relation to various claims including, inter alia, (i) disputes pertaining to payments to made in respect of Employee State Insurance (ii) fatal accidents involving employees of the Company and workmen employed by the contractors due to violation of various provisions of legislations and rules relating to factories; (iii) dismissal and termination of workmen and claims for re-instatement and regularisation; (iv) claims to wages for overtime work and back wages from the date of termination; and (v) denial of employment to dependants of deceased workmen of the Company. These matters are pending at various stages of adjudication.

Litigation involving Group Companies:

1. Coromandel Sugars Limited:

The Government of Karnataka under the New Industrial Policy Resolution, 1996 passed a G.O. No. CI 30 SPC 96 dated 15/03/1996, issuing a package of incentives and concessions for new industries in finished products effective from the period 1996 to 2001. Coromandel Sugars Ltd has claimed exemption on taxes on Sugar cane & Molasses. The Principal Secretary (Industrial Development) by 79th State level Committee decided that the unit has already been extended and availed Tax deferments on sugar cane under the G.O. No. CI 30 SPC 96 dated 15/03/1996, and Molasses being by-product, and incentives and concessions cannot be availed for by-products. Coromandel Sugars Ltd has filed a writ before the High Court of Karnataka for quashing the communication dated 15/03/2004 of the 79th state level committee decision.

2. Coromandel Electric Company Limited:

Coromandel Electric Company Ltd (CECL) had imported two diesel generators for setting up power plant and registered “project import” at custom house, Tuticorin for the benefit of exemption under Notification No. 21/02 Customs dated 01/03/2002. Power purchase agreement was entered into between CECL and the India Cements Ltd (ICL) and Tamil Nadu Electricity Board for wheeling the power, which indicated that the power generated by CECL is sold only to ICL. The Assistant Commissioner (Imports) has held that the power project commissioned by CECL is only a captive power plant catering exclusively to the

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needs of ICL which is a holding/associate company of CECL and hence the power plant will not be covered under the definition of project import and hence the exemption under the said Notification cannot be extended and that Rs. 5,70,57,458/- was to be paid as differential duty, against which CECL had preferred a appeal before the Commissioner of Customs (Appeals), Trichy . The appeal was allowed and the Order of the Assistant Commissioner was reversed. The Commissioner of Customs had then preferred an appeal before the CESTAT and the same was allowed wherein the order of the Assistant Commissioner was upheld. The company has filed special leave petition challenging the Order of CESTAT and the same is pending.

3. The following is the list of Promoter Group companies which have no outstanding litigations or any past cases where penalties have been imposed by the concerned authorities

i. Trishul Concrete Products Limited ii. India Cements Capital Limited iii. ICL Securities Limited iv. ICL International Limited v. PT Coromandel Mineral Resources, Jakarta vi. Industrial Chemicals and Monomers Limited vii. Raasi Cement Limited viii. Coromandel Electric Company Limited ix. Unique Receivable Management Private Limited x. Coromandel Resources Pte. Ltd.

Proceedings Initiated against the Promoters/Group Companies for Economic Offences

There are no proceedings initiated against the Promoters/ Group Companies for any economic offences.

Details of Past Penalties Imposed on the Promoters/Group Companies

There are no past penalties imposed on our Promoters/ Group Companies.

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GOVERNMENT AND OTHER APPROVALS

Government Approvals and Licenses We have received the necessary consents, licenses, permissions and approvals from the Government of India and various governmental agencies required for our present business and except as mentioned below, no further approvals are required for carrying on our present business.

It must be distinctly understood that, in granting these approvals, the Government of India does not take any responsibility for our financial soundness or for the correctness of any of the statements made or opinions expressed in this behalf.

In view of the approvals listed below, we can undertake this Issue and our current business activities and no further major approvals from any governmental or regulatory authority or any other entity are required to undertake the Issue or continue our business activities. Unless otherwise stated, these approvals are all valid as of the date of this Draft Letter of Offer.

I. Approvals for the Issue

 Approval of the Board dated November 12, 2010 for the Issue, subject to the approval of the shareholders of the Company  Approval of the shareholders of the Company dated February 21, 2011, obtained through postal ballot  Finalization of terms of the Issue by Share Issue Committee in its meeting held on March 30, 2011  In- principle approval from the Bombay Stock Exchange of India Limited dated [●].

II. Incorporation details

 Certificate of Incorporation dated March 12, 1987 issued by Registrar of Companies, Maharashtra  Company Identification Number is L99999MH1987PLC042858  Fresh Certificate of Incorporation dated January 20, 1992 issued by Asst. Registrar of Companies, Maharashtra consequent upon Change of name from “Indo Zinc Private Limited” to “Indo Zinc Limited”.  Fresh Certificate of Incorporation dated March 18, 2011 issued by Deputy Registrar of Companies, Maharashtra consequent upon change of name from “Indo Zinc Limited” to “Trinetra Cement Limited”.

III. General Approvals

The Company requires various approvals for it to carry on its business and the approvals that the Company requires include the following.

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 Approval received 1. Permanent Account Number (PAN) : AAACI0990C 2. Allotment of Tax deduction Account Number (TAN No.) dated August 8, 2008, bearing JDHI01534B issued by the Income-Tax Department. 3. Registration Certificate dated September 9, 2008 bearing No. AAACI0990CXM002 issued by the Assistant Commissioner of Central Excise Division, Chittorgarh registering Mahi Cement, a unit of the Company under the Central Excise Act, 1944. 4. Service tax registration Certificate dated September 9, 2008 bearing No. AAACI0990CST002 issued by the Assistant Commissioner Customs & Central Excise Division, Chittorgarh registering Mahi Cement, a unit of the Company under the Finance Act, 1994 5. Registration Certificate dated August 2, 2008 bearing No. 08513750195 issued by Commercial Taxes Officer, Banswara, registering Mahi Cement, a unit of the Company as a dealer under the Central Sales Tax Act, 1956. 6. Tax Identification Number dated August 2, 2008 bearing No. 08513750195 issued by the Commercial Taxes Officer, Banswara, registering Mahi Cement, a unit of the Company as a dealer under the Rajasthan VAT Act, 2003.

Approvals in relation to our plant

We are required to obtain certain approvals from the concerned central/ State government departments and other authorities for operating our business activities at our cement plant.

 General approvals received 1. Establishment Code Number dated June 25, 1010 bearing No. RJ/21885 issued by the Regional Provident Fund Commissioner registering Mahi Cement, a unit of the Company under the Employee Provident Fund & Miscellaneous Provisions Act 1952 2. Registration & Licence to work a Factory dated September 23, 2009 bearing No. RJ – 29353 issued to Mahi Cement, a unit of the Company by the Chief Inspector of Factories, Jaipur. The license is valid till March 31, 2015. 3. Certificate of Stability of buildings dated December 12, 2010 issued to Mahi Cement, a unit of the Company by S.K.Dalal, Engineers and Consultants, Ratlam a competent person under Rajasthan Factories Act, 1948. 4. Certificate of Registration dated July 28, 1996 as amended on December 11, 2008 bearing No. 7/96 issued to Mahi Cement, a unit of the Company by the Registering Officer and Assistant Labour Commissioner, Kota under the Contract Labour Act, 1970. 5. Certificate of Registration dated April 16, 2009 bearing No. 1/09 issued to Mahi Cement by Registering Officer and Assistant Labour Commissioner, Kota under the Inter-State-Migrant workmen Act, 1979. 6. Consent to operate granted for processing Clinker dated November 19, 2009 bearing (F(Tech)/Banswara (Garhi)/2(1)/2009-2010/5316-5320 and Order No. 2010-2011/CPM/490) issued to cement plant of Mahi Cement, a Division of Indo Zinc Ltd. At/near Wajvana Village, Garhi Tehsil, Banswara District by the Group

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Incharge, the Rajasthan State Pollution Control Board, Jaipur under the Air (Prevention & Control of pollution) Act 1981 and under Water (Prevention & Control of Pollution) Act, 1974. The consent is valid till September 30, 2013. 7. Bureau of India Standards license for 53 Grade Ordinary Portland Cement as per IS 12269:1987 dated January 11, 2011 bearing No CM/L-3172650 issued by the Bureau of Indian Standards, Jaipur. The license is valid till 19/12/2011. 8. Bureau of India Standards License for Portland Pozzolana Cement Part – I Fly Ash based dated January 11, 2011 bearing No.3172549 issued by the Bureau of Indian Standards, Jaipur. The license is valid till 19/12/2011.

 Mining related approvals received 1. Consent to operate granted for mining activities relating to Lime Stone dated September 18, 2009 bearing (File No. F (Mines) Banswara (Garhi)/1(1)/2009- 2010/2879) and Order No. 2009-2010/Mines/209) issued to. Mahi Cement, a Division of Indo Zinc Ltd in an area measuring 65.82 Hectares at/near Partthipura Village, Garhi Tehsil, Banswara District by the Group Incharge- Mines, Rajasthan State Pollution Control Board, Jaipur under the Air (Prevention & Control of pollution) Act 1981 and under Water (prevention & Control of Pollution) Act 1974. The consent is valid till August 31, 2012 2. License in Form LE-3 of Explosives Act, 1884 dated January 7, 2011 bearing No. E/NC/RJ/22/804(E52361) to possess and use explosives in a magazine situated at Survey No.1006, Lordha, Distt. Banswara, State of Rajasthan issued by Joint Chief Controller of Explosives, North Circle, Faridabad. The license is valid till March 31, 2015. 3. License in Form LE-3 of Explosives Act, 1884 dated January 7, 2011 bearing No. E/NC/RJ/22/805(E52359) to possess and use explosives in a magazine situated at Survey No.1006, Lordha, Distt. Banswara, State of Rajasthan issued by Joint Chief Controller of Explosives, North Circle, Faridabad. The license is valid till March 31, 2015. 4. Permission dated November 2, 2010 bearing No.3896/CIB/2010 to carryout the erection permission of Boiler makers No. BJ-080 issued by the Chief inspector of Factories & Boilers, Jaipur, Rajasthan. 5. Permission dated July 2, 2009 bearing No. UR/NC/Perm-106 (2)(b)/2009/3218 under the Metalliferous Mines Regulations, 1961 to work the mine by a system of deep hole blasting and deploying heavy earth moving machinery for digging, excavation and removal of overburden and limestone at Parthipura limestone mine issued by the Directorate General of Mines Safety, Udaipur. 6. License dated February 17, 2011 file No. E- 52271 Reference No ;- E/NC/RJ/38/96/E- 52271 for construction and use of 2.0 Kgm Ammonium Nitrate Fuel Oil by the Deputy Chief Controller of Explosives, Petroleum and Explosives safety organisation (PESO), Government of India. The License is valid till 30.04.2011

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OTHER REGULATORY AND STATUTORY DISCLOSURES

Authority and Eligibility for the Issue

The Company is an existing company registered under the Companies Act and its Equity Shares are listed on the BSE, among other stock exchanges. The Issue is authorised pursuant to a board resolution dated November 12, 2010 and shareholders’ approval under section 81 of the Companies Act declared on February 21, 2011. The details of the Rights Issue to the existing shareholders of our Company, as decided in the meeting of the Share Issue Committee held on March 30, 2011 are as follows:

SIMULTANEOUS BUT UNLINKED ISSUE OF 4,92,31,600 EQUITY SHARES OF RS. 10 EACH AT A PRICE OF RS. 22.50 (INCLUDING SHARE PREMIUM OF RS. 12.50 PER FULLY PAID EQUITY SHARE) AGGREGATING RS. 110.77 CRORE IN THE RATIO OF 11 EQUITY SHARES FOR EVERY EQUITY SHARE HELD BY THE EXISTING SHAREHOLDERS ON THE RECORD DATE , i.e. *●+ AND ISSUE OF 1,79,02,400 CUMULATIVE OPTIONALLY CONVERTIBLE REDEEMABLE PREFERENCE SHARES OF RS.100 EACH AT A PRICE OF RS. 100, AGGREGATING RS. 179.02 CRORE ON RIGHTS BASIS TO THE EXISTING SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF 4 CUMULATIVE OPTIONALLY CONVERTIBLE REDEEMABLE PREFERENCE SHARES FOR EVERY EQUITY SHARE HELD BY THE EXISTING SHAREHOLDERS ON THE RECORD DATE, THAT IS ON *●+ (“THE ISSUE”). THE TOTAL PROCEEDS FROM THE ISSUE OF EQUITY SHARES AND OCRPS WOULD AGGREGATE TO Rs. 289.79 CRORE.

PROHIBITION BY SEBI

Our Company, Promoters, Directors or any of the Company’s associates or group companies with which the Directors of our Company are associated as Directors or Promoters have not been prohibited from accessing the capital market under any order or direction passed by SEBI.

Further neither us, nor our Directors, Promoter, promoter group or group companies have been declared as willful defaulters by RBI or any other governmental authority. Further, they have not been prohibited by SEBI from accessing the capital market for any reasons by SEBI or any other authorities.

Securities Related Business

The following Directors are associated in the securities market, in their capacity of directors of India Cements Capital Limited, which is a SEBI registered entity.

1. Shri N Srinivasan, Chairman 2. Dr. B S Adityan 3. Shri T S Raghupathy 4. Shri A Sankarakrishnan 5. Shri N Srinivasan

SEBI has not initiated any action against ICCL.

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DISCLAIMER CLAUSE OF SEBI

AS REQUIRED, A COPY OF THIS DRAFT LETTER OF OFFER HAS BEEN SUBMITTED TO THE SECURITIES AND EXCHANGE BOARD OF INDIA.

IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF DRAFT 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 THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THE OFFER DOCUMENT. LEAD MANAGER, MAPE ADVISORY GROUP PRIVATE LIMITED, HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH SEBI (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 IN FORCE FOR THE TIME BEING. THIS REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED ISSUE.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER COMPANY IS PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT INFORMATION IN THE DRAFT LETTER OF OFFER, 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, MAPE ADVISORY GROUP PRIVATE LIMITED HAS FURNISHED TO SEBI A DUE DILIGENCE CERTIFICATE DATED March 30, 2011 WHICH READS AS FOLLOWS:

1. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO LITIGATIONS LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH COLLABORATORS ETC. AND OTHER MATERIAL 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 OTHER PAPERS FURNISHED BY THE COMPANY, WE CONFIRM THAT: a. THE DRAFT LETTER OF OFFER FILED WITH THE BOARD IS IN CONFORMITY WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE; b. ALL THE LEGAL REQUIREMENTS TO THE SAID ISSUE AS ALSO THE GUIDELINES, INSTRUCTIONS, ETC. FRAMED/ISSUED BY THE BOARD, THE CENTRAL GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY IN THIS BEHALF HAVE BEEN DULY COMPLIED WITH; AND c. THE DISCLOSURES MADE IN THE DRAFT 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 AND SUCH DISCLOSURES ARE IN ACCORDANCE WITH THE REQUIREMENTS OF THE COMPANIES ACT, 1956, THE SEBI (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 AND OTHER APPLICABLE LEGAL REQUIREMENTS.

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3. WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE DRAFT LETTER OF OFFER ARE REGISTERED WITH THE BOARD AND THAT TILL DATE SUCH REGISTRATION IS VALID. – REFER NOTE 4. WE HAVE SATISFIED OURSELVES ABOUT THE CAPABILITY OF THE UNDERWRITERS TO FULFIL THEIR UNDERWRITING COMMITMENTS – NOT APPLICABLE AS THE ISSUE IS NOT UNDERWRITTEN. 5. WE CERTIFY THAT WRITTEN CONSENT FROM PROMOTERS HAS BEEN OBTAINED FOR INCLUSION OF THEIR SPECIFIED SECURITIES AS PART OF PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN AND THE SPECIFIED SECURITIES PROPOSED TO FORM PART OF PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN SHALL NOT BE DISPOSED/ SOLD/ TRANSFERRED BY THE PROMOTERS DURING THE PERIOD STARTING FROM THE DATE OF FILING THE DRAFT LETTER OF OFFER WITH THE BOARD TILL THE DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT LETTER OF OFFER. – NOT APPLICABLE AS THE PRESENT ISSUE IS A RIGHTS ISSUE. 6. WE CERTIFY THAT REGULATION 33 OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUES OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, WHICH RELATES TO SPECIFIED SECURITIES INELIGIBLE FOR COMPUTATION OF PROMOTERS CONTRIBUTION, HAS BEEN DULY COMPLIED WITH AND APPROPRIATE DISCLOSURES AS TO COMPLIANCE WITH THE SAID REGULATION HAVE BEEN MADE IN THE DRAFT LETTER OF OFFER – NOT APPLICABLE AS THE PRESENT ISSUE IS A RIGHTS ISSUE. 7. WE UNDERTAKE THAT SUB-REGULATION (4) OF REGULATION 32 AND CLAUSE (C ) AND (D) OF SUB-REGULATION (2) OF REGULATION 8 OF THE SEBI (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 SHALL BE COMPLIED WITH. WE CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT PROMOTERS’ CONTRIBUTION SHALL BE RECEIVED AT LEAST ONE DAY BEFORE THE OPENING OF THE ISSUE. WE UNDERTAKE THAT AUDITORS’ CERTIFICATE TO THIS EFFECT SHALL BE DULY SUBMITTED TO THE BOARD. WE FURTHER CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT PROMOTERS’ CONTRIBUTION SHALL BE KEPT IN AN ESCROW ACCOUNT WITH A SCHEDULED COMMERCIAL BANK AND SHALL BE RELEASED TO THE ISSUER ALONG WITH THE PROCEEDS OF THE PUBLIC ISSUE. - NOT APPLICABLE AS THE PRESENT ISSUE IS RIGHTS ISSUE. 8. WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE ISSUER FOR WHICH THE FUNDS ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE “MAIN OBJECTS” LISTED IN THE OBJECT CLAUSE OF THE MEMORANDUM OF ASSOCIATION OR OTHER CHARTER OF THE ISSUER AND THAT THE ACTIVITIES WHICH HAVE BEEN CARRIED OUT UNTIL NOW ARE VALID IN TERMS OF THE OBJECT CLAUSE OF ITS MEMORANDUM OF ASSOCIATION. 9. WE CONFIRM THAT NECESSARY ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT THE MONIES RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE BANK ACCOUNT AS PER THE PROVISIONS OF SUB SECTION (3) OF SECTION 73 OF THE COMPANIES ACT, 1956 AND THAT SUCH MONIES SHALL BE RELEASED BY THE SAID BANK ONLY AFTER PERMISSION IS OBTAINED FORM ALL THE STOCK EXCHANGES MENTIONED IN THE DRAFT LETTER OF OFFER. WE FURTHER CONFIRM THAT THE AGREEMENT ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE ISSUER SPECIFICALLY CONTAINS THIS CONDITION – NOTED FOR COMPLIANCE 10. WE CERTIFY THAT A DISCLOSURE HAS BEEN MADE IN THE DRAFT LETTER OF OFFER THAT THE INVESTORS SHALL BE GIVEN AN OPTION TO GET THE SHARES IN DEMAT OR PHYSICAL MODE.

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11. WE CERTIFY THAT ALL APPLICABLE DISCLOSURES MANDATED IN SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 HAVE BEEN MADE IN THE ADDITION TO DISCLOSURES WHICH, IN OUR VIEW, ARE FAIR AND ADEQUATE TO ENABLE THE INVESTOR TO MAKE A WELL INFORMED DECISION. 12. WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THE DRAFT LETTER OF OFFER: a. AN UNDERTAKING FROM THE ISSUER THAT AT ANY GIVEN TIME THERE SHALL BE ONLY ONE DENOMINATION FOR THE EQUITY SHARES OF THE COMPANY; AND b. AN UNDERTAKING FROM THE ISSUER THAT IT SHALL COMPLY WITH SUCH DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY SEBI FROM TIME TO TIME. 13. WE UNDERTAKE TO COMPLY WITH THE REGULATIONS PERTAINING TO THE ADVERTISMENT IN TERMS OF SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 WHILE MAKING THE ISSUE. 14. WE ENCLOSE A NOTE EXPLAINING HOW THE PROCESS OF DUE DILIGENCE HAS BEEN EXERCISED BY US IN VIEW OF THE NATURE OF CURRENT BUSINESS BACKGROUND OF THE ISSUER, SITUATION AT WHICH THE PROPOSED BUISNESS STANDS, THE RISK FACTORS, PROMOTERS’ EXPERIENCE, ETC. 15. WE ENCLOSE A CHECKLIST CONFIRMING REGULATIONWISE COMPLIANCE WITH THE APPLICABLE PROVISIONS OF SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, CONTAINING DETAILS SUCH AS THE REGULATION NUMBER, ITS TEXT, THE STATUS OF COMPLIANCE, PAGE NUMBER OF THE DRAFT LETTER OF OFFER WHERE THE REGULATION HAS BEEN COMPLIED WITH AND OUR COMMENTS, IF ANY.

THE FILING OF THE OFFER DOCUMENT DOES NOT, HOWEVER, ABSOLVE THE ISSUER FROM ANY LIABILITIES UNDER SECTION 63 OR SECTION 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 ANY IRRREGULARITIES OR LAPSES IN OFFER DOCUMENT.

CAUTION STATEMENT / DISCLAIMER STATEMENT FROM OUR COMPANY, OUR DIRECTORS AND THE LEAD MANAGER

The Issuer Company and the Lead Manager accept no responsibility for statements made otherwise than in this Offer Document or in the advertisement or in any other material issued by or at the instance of the Company and the Lead Manager and any one placing reliance on any other source of information would be doing so at his/her/their own risks.

The Company, the Directors and the Lead Manager accept no responsibility for statements made otherwise than in this Draft Letter of Offer or in the advertisements or any other material issued by or at the Company’s instance and anyone placing reliance on any other source of information would be doing so at his or her own risk. The information on the Company’s website does not form part of this Draft Letter of Offer.

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All information shall be made available by the Company and the Lead Manager to the public and investors at large and no selective or additional information would be available for a section of the investors in any manner whatsoever.

Bidders will be required to confirm and will be deemed to have represented to the Company, the Lead Manager and their respective directors, officers, agents, affiliates, and representatives that they are eligible under all applicable laws, rules, regulations, guidelines and approvals to acquire the Securities of the Company and will not Issue, sell, pledge, or transfer the Securities of the Company to any person who is not eligible under any applicable laws, rules, regulations, guidelines and approvals to acquire the Securities of the Company. The Company, the Lead Manager and their respective directors, officers, agents, affiliates, and representatives accept no responsibility or liability for advising any investor on whether such investor is eligible to acquire Securities of the Company.

DISCLAIMER CLAUSE OF THE BSE

As required, a copy of this Draft Letter of Offer shall be submitted to the BSE. The Disclaimer Clause as intimated by the BSE to us, post scrutiny of this Draft Letter of Offer, shall be included in the Letter of Offer prior to sending the Letter of Offer to our Equity Shareholders.

DISCLAIMER IN RESPECT OF JURISDICTION

This Letter of Offer has been prepared under the provisions of Indian Laws and the applicable rules and regulations thereunder. Any dispute arising out of this Offer will be subject to the jurisdiction of appropriate court(s) in Chennai, State of Tamil Nadu, India only.

No action has been or will be taken to permit a public offering in any jurisdiction where action would be required for that purpose, except that this Offer Document has been submitted to the SEBI. Accordingly, the securities represented thereby may not be offered or sold, directly or indirectly, and this Offer Document may not be distributed, in any jurisdiction, except in accordance with the legal requirements applicable in such jurisdiction. Neither the delivery of Offer Document nor any sale hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of our Company since the date hereof or that the information contained herein is correct as of any time subsequent to this date.

Filing

A copy of this Draft Letter of Offer has been filed with SEBI at SEBI Bhavan, Plot No. C-4A, G- Block, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051 and with BSE at Phiroze Jeejeebhoy Towers, Dalal Street, Fort, Mumbai-400001.

Listing

The existing Equity Shares are listed on the BSE, ASE, MPSE and DSE. However, trading of Equity Shares are currently suspended in the ASE, MPSE and DSE.

In compliance with clause 7(b)(iii) of the SEBI (ICDR) Regulations, the Company had made an application to the BSE dated *●+, seeking “in-principle” approval for the listing of the Equity Shares issued pursuant to the Issue. The Company has received such approval from the BSE

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pursuant to letter no. *●+ dated *●+. The Company will apply to BSE for final approval for the listing and trading of the Equity Shares. If the permission to deal in and for an official quotation in respect of the Equity Shares to be issued pursuant to the Issue is not granted by BSE, the Company shall forthwith repay, without interest, all the subscription money received from the Investors in respect of Equity Shares offered pursuant to this Letter of Offer. If there is delay in the refund of such subscription money by more than eight days after the Company becomes liable to repay the subscription money (i.e., 15 days after the Issue Closing Date), the Company and every Director of the Company who is an officer in default shall be jointly and severally liable to repay the money with interest for the delayed period, at the rate of 15% per annum, as stipulated under sub-sections (2) and (2A) of Section 73 of the Companies Act.

The Equity Shares issued pursuant to the Issue shall not be listed and traded on the ASE, MPSE and DSE. It is not proposed to list the OCRPS on any stock exchanges, including on the BSE.

Consents Consents in writing of the Directors, the Statutory Auditors of the Company, Auditors to the Issue, the Lead Manager, the Legal Counsel and the Registrar to the Issue have been obtained and such consents have not been withdrawn up to the date of the Draft Letter of Offer. M/s DPH & Co. and M/s Chaturvedi SK & Fellows have given their written consent for the inclusion of their reports on financial statements of the company and report on Tax Benefits, as the case may be, in the form and content appearing in this Draft Letter of Offer and such consent and report have not been withdrawn up to the date of this Draft Letter of Offer. Consent from the Lenders is currently being sought.

Expert Opinion, if any

No expert opinion has been obtained by us in relation to this Draft Letter of Offer.

Issue related expenses The other expenses of the Issue payable by us including printing and distribution expenses, publicity, listing fees, stamp duty and other expenses are estimated at *●+ Lacs (approx. *●+ % of the total Issue size) and will be met out of the proceeds of the Issue. The following table provides a break up of estimated issue expenses:

Particulars Expense* (Lacs) Expense* (% of the Expense* (% of the total expenses) Issue size) Fees of Lead Manager, *●+ *●+ *●+ Registrars to the Issue, Bankers to the Issue, Legal advisor, etc Statutory Advertising and *●+ *●+ *●+ marketing Printing & Distribution *●+ *●+ *●+ Contingency, Stamp Duty, *●+ *●+ *●+ Listing Fees, etc Total estimated Issue *●+ *●+ *●+ expenses

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* Amounts will be finalized at the time of filing of Letter of Offer and determination of Issue Price and other details.

Previous Public or Rights Issues by our Company

Our Company has not undertaken a public or rights issue in the last five years.

Previous Issue of Securities other than for cash

Our Company has issued the following securities for consideration other than cash:

Persons to Number of Face Date of Benefits accrued whom Equity Value Nature of Allotment Allotment to our Company Allotted Shares (Rs.) Bonus in the ratio of Existing 25.11.1992 2,50,000 10 one share for every 3 Nil Shareholders shares held Shareholders Allotted to shareholders All assets and of erstwhile of Mahi Cement Limited 10.10.1995 3,84,000 10 liabilities of Mahi Mahi Cement upon amalgamation Cement Limited Limited with our Company

Capital Issue by listed group company

Name of the company The India Cements Limited Year of Issue 2010 Type of Issue Qualified Institutions Placement No. of instruments 245,94,000 Equity Shares of Rs. 10 each Amount of issue Rs. 29561.99 Lakhs Date of closure of issue March 10, 2010 Date of completion of the project NA Rate of dividend paid NA

Promise Vis-À-Vis Performance

Our Company has not made a public issue or rights issue during the period of ten years immediately preceding the date of the Draft letter of Offer. Our group company, India Cements, had issued 245,94,000 equity shares, through a QIP in 2010. The Company has deployed funds as per the objects provided in the offer document.

Outstanding Debentures/Bonds and Preference Shares

Our Company has not issued any debentures, bonds. For details on NCRPS issued by us, please refer to Chapter titled “Capital Structure” beginning on page 21 of this Draft Letter of Offer.

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Fees Payable to the Lead Manager to the Issue

The fees payable to the Lead Manager to the Issue are set out in the engagement letter entered into by our Company with the Lead Manager, a copy of which is available for inspection at the Registered Office of our Company.

Fees Payable to the Registrar to the Issue

The fees payable to the Registrar to the Issue are set out in the engagement letter issued by our Company to the Registrar to the Issue.

INVESTOR GRIEVANCE REDRESSAL SYSTEM

The investor grievances against our Company are handled by the Registrar and Transfer Agent in consultation with the secretarial department of our Company. To handle the grievances received, our Company has appointed Shri S Sridharan, Company Secretary as the Compliance Officer. He will supervise redressal of complaints received from the investors at the corporate office of our Company as well as the Registrar to the Issue and ensure timely settlement.

All grievances related to the offer may be addressed to the Registrar to the Issue quoting the application no. (Including prefix), Number of Securities applied for, amount paid on application, date of application, Bank and branch/ Collection centre where application was submitted.

The normal time taken by our Company for redressal of investor grievance is given below:

Sl. Normal Time Taken Type of Request No. (No. of Days) 1 Issue of Duplicate Share Certificate Within 30 days 2 Transfer of shares Within 30 days 3 Transmission of shares Within 30 days 4 Demat / Remat of shares Within 30/21 days 5 Non receipt of dividend Within 15 to 30 days 6 Non receipt of Annual Report Within 7 to 15 days 7 Change of residential address / Bank mandate Within 15 to 30 days 8 Consolidation / split of share certificates / Remat Within 30 days

If our Company does not receive minimum subscription of 90% of the Issue (separately for Equity Shares and OCRPS) or the subscription level falls below 90% after the Issue Closing Date, on account of cheques being returned unpaid or withdrawal of applications our Company shall forthwith refund the entire subscription amount received in respect of the Equity Shares or OCRPS, as the case may be, within 15 days from the date of closure of the Issue. If there is a delay in the refund of subscription amount by more than eight days after the Company becomes liable to pay the subscription amount (i.e. 15 days after closure of the Issue), the Company will pay interest at the rate of 15% per annum, as prescribed under sub-sections (2) and (2A) of Section 73 of the Companies Act.

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Investor Complaints for our Company

Investor complaints received between January 01, 2010 to date 14 Investor complaints disposed off 13 Investor complaints pending as on the date of the DLoF 1

Investor complaints pending for listed group companies

As on the date of the DLoF, the status of investor complaints pending against listed group companies was as follows:

Name of group company Investor Complaints pending The India Cements Limited NIL India Cements Capital Limited NIL

Change in Auditors There has been no change in our statutory auditor during the last three years.

Capitalization of reserves or profits Our Company has not capitalized its reserves or profits in the last three years.

Revaluation of assets Our Company has not revalued its assets during the last five years.

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SECTION VII – OFFERING INFORMATION

TERMS OF THE ISSUE The Equity Shares and the Optionally Convertible Redeemable Preference Shares (“OCRPS”) (collectively, the “Securities”) proposed to be issued on rights basis, are subject to the terms and conditions contained in the Draft Letter of Offer, the CAF, the Memorandum of Association and Articles of Association of the Company, the provisions of the Companies Act, the terms and conditions as may be incorporated in the Foreign Exchange Management Act, 1999, as amended (“FEMA”), guidelines and regulations 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 security certificate and rules as may be applicable and introduced from time to time.

Authority for the Issue

The Issue is authorised by a board resolution dated November 12, 2010 and shareholders’ approval accorded by way of special resolution under section 81 of the Companies Act declared on February 21, 2011. The terms of the Issue were approved by the Share Issue Committee at its meeting held on March 30, 2011.

Basis for the Issue

The Securities are being offered for subscription for cash to those existing Equity Shareholders 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 the physical form at the close of business hours on the Record Date i.e. *●+ fixed in consultation with the Designated Stock Exchange.

Rights Entitlement

As your name appears as beneficial owner in respect of Equity Shares held in the electronic form or appears in the register of members as an Equity Shareholder of the Company as on the Record Date, i.e., *●+, you are entitled to the number of Securities as set out in Part A of the enclosed CAFs.

The eligible Equity Shareholders are entitled to apply for either or both of the following:

 11 Equity Shares for every 1 Equity Share held on the Record Date; and  4 OCRPS for every 1 Equity Share held on the Record Date.

PRINCIPAL TERMS OF THE EQUITY SHARES

Face value

Each Equity Share shall have the face value of Rs. 10/-.

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Rights Entitlement Ratio

The Equity Shares are being offered on rights basis to the existing Equity Shareholders of the Company in the ratio of 11 Equity Shares for every 1 Equity Share held as on the Record Date.

Terms of payment

Each Equity Share shall be offered at an Issue Price of Rs. 22.50 (at a premium of Rs. 12.50 per Equity Share) and the full consideration is payable on application. The Issue Price has been arrived in consultation between the Company and the Lead Manager.

Payment other than by ICLFSL/India Cements:

On application, the aggregate amount in respect of the Equity Shares applied for in the Issue at Rs.22.50 per Equity Share, which constitutes the full amount of the Issue Price, shall be payable.The payment towards the Equity Shares offered will be applied as under:

Rs. 10 per Equity Share Towards Equity Share Capital

Rs. 12.50 per Equity Share Towards Securities Premium Account

A separate cheque/demand draft/pay order in respect of the Application Money must accompany each CAF. Payment should be made by cheque/demand draft/pay order drawn on any bank (including a co-operative bank) which is situated at and is a member or a sub-member of the bankers clearing house located at the center where the CAF is accepted. Outstation cheques/demand drafts/pay orders will not be accepted and CAFs accompanied by such outstation cheques/demand drafts/pay orders are liable to be rejected. In case of ASBA Applicants, payment should be made in accordance with the procedure set out under “— Procedure for application through the ASBA process” below in the section titled “Issue Procedure” on page 187 of this Draft Letter of Offer.

Pursuant to the RBI Circular DBOD No. FSC BC 42/24.47.00/2003-04 dated November 5, 2003, the Stockinvest scheme has been withdrawn and accordingly, payment through Stockinvest will not be accepted in the Issue.

Where an applicant has applied for additional Equity Shares and is allotted a lesser number of Equity Shares than applied for, the excess Application Money paid shall be refunded. The excess Application Money will be refunded within 15 days from the Issue Closing Date, and if there is a delay beyond eight days from the stipulated period, the Company and every Director of the Company who is an officer in default shall be jointly and severally liable to repay the money with interest for the delayed period, at the rate of 15% per annum, as stipulated under subsections (2) and (2A) of Section 73 of the Companies Act.

Payment by ICLFSL/India Cements:

On application, the aggregate amount payable by the ICLFSL/India Cements (including both (i) the entitlement of the ICLFSL/India Cements, as applicable, and (ii) The additional Equity Shares subscribed to by ICLFSL/India Cements to ensure full subscription of Equity Shares offered pursuant to the issue) at Rs. 22.50 per Equity Share shall be deemed to have been paid by

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ICLFSL/India Cements without any further act, deed or thing, consequent to the letter dated March 29, 2011 by India Cements and ICLFSL.

Ranking of the Equity Shares

The Equity Shares shall be subject to the Memorandum and Articles of Association of the Company and shall rank pari passu in all respects including dividends with the existing Equity Shares of the Company.

Listing and trading of Equity Shares proposed to be issued

The Company’s existing Equity Shares are currently traded on the BSE under the ISIN ‘INE031L01014.’ The fully paid up Equity Shares proposed to be issued on a rights basis shall be listed and admitted for trading on the BSE under the existing ISIN for fully paid Equity Shares of the Company. The Equity Shares are not proposed to be listed on the ASE, MPSE and DSE.

The listing and trading of the Equity Shares shall be based on the current regulatory framework applicable thereto.

The Equity Shares allotted pursuant to this Issue will be listed as soon as practicable but in no case later than seven working days from the finalisation of the basis of allotment. The Company has made an application for “in-principle” approval for listing of the Equity Shares respectively to the BSE through letter dated *●+ and has received such approval from the BSE pursuant to the letter no. *●+, dated *●+.

The Company will also apply to the BSE for final approval for the listing and trading of the equity shares. No assurance can be given regarding the active or sustained trading in the Equity Shares, or the price at which the Equity Shares offered under the issue will trade post listing at the BSE.

Rights of the Equity Shareholders

Subject to applicable laws, the Equity Shareholders shall have the following rights:

• Right to receive dividend, if declared and at such rate as declared for Equity Shares; • Right to attend general meetings and exercise voting powers, unless prohibited by law; • Right to vote on a poll in person or by proxy; • Right to receive offers for rights shares and be allotted bonus shares, if announced; • Right to receive surplus on liquidation; • Right to free transferability of Equity shares; and • Such other rights as may be available to a shareholder of a listed public Company under the Companies Act, Memorandum and Articles of Association and the Listing Agreement.

For further details on the main provisions of our Company’s Articles of Association dealing with voting rights, dividend, forfeiture and lien, transfer and transmission and / or consolidation / splitting, please refer to the section titled “Main Provisions of our Articles of Association” on page 217 of the Draft Letter of Offer.

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PRINCIPAL TERMS OF THE OPTIONALLY CONVERTIBLE CUMULATIVE REDEEMABLE PREFERENCE SHARES

Face Value

Each OCRPS shall have the face value of Rs. 100/-.

Rights Entitlement Ratio

The OCRPS are being offered on a rights basis to the existing Equity Shareholders of the Company in the ratio of 4 OCRPS for every 1 Equity Share held as on Record Date.

Terms of payment

Each OCRPS of face value of Rs. 100/- shall be offered at par and the full consideration is payable on application.

Payment other than by India Cements/ICLFSL:

On application, the aggregate amount in respect of the OCRPS applied for in the Issue at Rs. 100/- per OCRPS, which constitutes the full consideration, shall be payable.

A separate cheque/demand draft/pay order in respect of the Application Money must accompany each CAF. Payment should be made by cheque/demand draft/pay order drawn on any bank (including a co-operative bank) which is situated at and is a member or a sub-member of the bankers clearing house located at the center where the CAF is accepted. Outstation cheques/demand drafts/pay orders will not be accepted and CAFs accompanied by such outstation cheques/demand drafts/pay orders are liable to be rejected. In case of ASBA Applicants, payment should be made in accordance with the procedure set out under “Procedure for application through the ASBA process” below in the section titled “Issue Procedure” on page 187 of this Draft Letter of Offer.

Where an applicant has applied for additional OCRPS and is allotted a lesser number of OCRPS than applied for, the excess application money paid shall be refunded. The excess application money will be refunded within 15 days from the Issue Closing Date, and if there is a delay beyond eight days from the stipulated period, the Company and every Director of the Company who is an officer in default shall be jointly and severally liable to repay the money with interest for the delayed period, at the rate of 15% per annum, as stipulated under subsections (2) and (2A) of Section 73 of the Companies Act.

Payment by ICLFSL/India Cements:

On application, the aggregate amount payable by the ICLFSL/India Cements (including both (i) the entitlement of the ICLFSL/India Cements, as applicable, and (ii) The additional Equity Shares subscribed to by ICLFSL/India Cements to ensure full subscription of Equity Shares offered pursuant to the issue) at Rs. 100.00 per OCRPS shall be deemed to have been paid by

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ICLFSL/India Cements without any further act, deed or thing, consequent to the letter dated March 29, 2011 by India Cements and ICLFSL.

Tenor of OCRPS

The Tenor of the OCRPS is 8 years from the date of allotment.

Dividend

The OCRPS shall carry a dividend of 9%, payable on an annual basis subject to applicable law. The payment of dividend on OCRPS to the holders of the OCRPS will be subject to the same being declared in the General Meeting of the Company. The dividend is cumulative, which means that if the Company is not able to pay dividend on OCRPS in any period the same would be payable whenever the Company is in a position to declare dividend on OCRPS.

The payment of dividend shall be made to those holders of OCRPS whose names appear as beneficial owners in accordance with the list to be furnished by the depositories in respect of the OCRPS held in the electronic form and on the Register of OCRPS holders of the Company in respect of the OCRPS held in physical form, at the close of business hours on the record date, to be fixed by the Company.

As per the provisions of the Income Tax Act, 1961, the OCRPS holder is not liable to pay tax on the dividend received from the Company. However, the Company is liable to pay a dividend distribution tax in accordance with the provisions of Income Tax Act presently in force.

Conversion of OCRPS into Equity Shares

The holders of the OCRPS have the right to convert the OCRPS at any time after two years from the date of allotment but prior to the redemption of the OCRPS in accordance with the terms set out below. Please refer below for details on the conversion ratio.

The Equity Shares allotted upon conversion shall rank pari passu in all respects with the existing Equity Shares of the Company.

Conversion Ratio

The OCRPS will be converted into Equity Shares of Rs.10/- at a price of Rs. 25/- (including Equity Share Premium of Rs. 15/-) per Equity Share in the ratio of 4 Equity Shares for every 1 OCRPS.

Redemption

Subject to applicable law and the consent of the lenders, if required, the Company has the right to redeem the OCRPS against the issuance of one 10% - Non Convertible Debenture (“NCD”) of Rs.100/- each against the redemption price of each OCRPS on any of the following dates (“redemption dates”):

 End of 3rd year from the date of allotment; or  End of 4th year from the date of allotment; or  End of 5th year from the date of allotment; or  End of 6th year from the date of allotment; or

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 End of 7th year from the date of allotment.

Please refer below for the terms of the NCDs and the rights of the holders of the NCDs.

The Company can redeem the OCRPS in more than one tranches subject to the condition that the redemption shall be applicable on a proportionate basis to all OCRPS holders and not on a selective basis to some OCRPS holders alone. The remaining OCRPS would continue to be outstanding and governed by the terms mentioned herein.

For this purpose, the decisions would be taken by the Board of Directors of the Company. A record date will be announced immediately after the decision of redemption / conversion.

The record date, as far as possible, will be fixed at least 30 days before the redemption date. Upon redemption, OCRPS, to the extent redeemed, shall stop carrying all rights of the OCRPS holders, as mentioned below.

In the event that the OCRPS are not redeemed in the manner stated above or converted into Equity Shares, the OCRPS will be redeemed at the end of the tenor of the OCRPS.

Mechanism for redemption

In the event that the Board of Directors of the Company decides to redeem the OCRPS, the same will be communicated to all the holders of the OCRPS.

The Company shall issue notices to the OCRPS holders and such notices will be sent individually to OCRPS holders whose names appear on the register of OCRPS holders as on the record date of relevant redemption date through post. Such notice will be sent at least 30 days prior to the date of redemption and will contain the particulars of the number of OCRPS to be redeemed and the number of NCDs to be issued against such redemption. Any non-receipt of such notice(s) by holders of OCRPS would not affect the redemption of the OCRPS, in any manner.

Rights of the OCRPS holder

Subject to applicable laws, the OCRPS holders shall have the following rights

• The OCRPS shall rank for capital and dividend and for repayment of capital in a winding up, pari passu inter se and with the NCRPS outstanding but in priority to the Equity Shares of the Company but shall not confer any further or other right to participate either in profits or assets and that preferential rights shall automatically cease on conversion of these shares into Equity Shares or redemption against the issuance of NCDs. • The OCRPS as and when converted into Equity Shares shall rank pari passu with the then existing Equity Shares of the Company in all respects. • The holders of OCRPS shall have the right to receive all notices of general meetings of the Company but shall not confer on the holders thereof the right to vote at any meetings of the Company, save to the extent and in the manner provided for in the Companies Act or any re-enactment thereof.

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• The OCRPS shall not confer any right on the holders thereof to participate in any offer or invitation by way of rights or otherwise to subscribe for additional shares in the Company; nor shall the OCRPS confer on the holders thereof any right to participate in any issue of bonus shares or shares issued by way of capitalization of reserves. • The rights and terms attached to the OCRPS may be modified or dealt with by the Directors in accordance with the provisions of the Articles of Association of the Company.

Terms of NCDs

The NCDs will have a term of 5 years from the date of allotment, at the end of which they shall be redeemed by the Company. An interest of 10% per annum shall be paid on the NCDs from the date of allotment upto the date of redemption by the Company. The issue of the NCDs shall be duly rated by a credit rating agency and trustees will be appointed for the holders of the NCDs.

The NCDs, payment of remuneration of the Trustees, all fees, costs, charges, expenses and all other monies payable in respect thereof, will be secured by an appropriate charge in favour of the Trustees in such form and manner as may be decided by the Board of Directors in consultation with the Trustees on all or part of the immoveable properties of the Company as well as a charge on all or part of the moveable properties of the Company. All monies to be secured, will as between the holders of the NCDs inter-se rank pari passu without any preference or priority whatsoever on account of date of issue or allotment or otherwise.

Rights of holders of the NCDs

 The NCDs shall rank pari-passu inter-se without any preference or priority of one over the other or others of them.  The holders of NCDs will not be entitled to any right and privileges of the Equity Shareholders of the Company other than those available to them under statutory requirements. The NCDs shall not confer upon the NCD holders the right to receive notice, or to attend and vote at the general meetings of shareholders of the Company.  The rights, privileges, terms and conditions attached to the NCDs may be varied, modified or abrogated with the consent, in writing, of those holders of the NCDs who hold at least three fourths of the outstanding amount of the NCDs (of the current issue) or with the sanction accorded pursuant to a resolution passed at the meeting of the NCDs holders; provided that nothing in such consent or resolution shall be operative against the Company where such consent or resolution modifies or varies the terms and conditions governing the NCDs and the same are not acceptable to the Company.  The Company shall, as required by Section 152 of the Companies Act, keep a Register of the holders of NCDs and enter therein the particulars prescribed under the said section.  The Trustees or the Company may, at any time, and the Trustees shall at the request in writing of the holder(s) of NCDs representing not less than one-tenth in value of the nominal amount of the NCDs for the time being outstanding, convene a meeting of the

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holders of the NCDs by giving not less than 21 days notice in writing. Provided that a meeting may be called by giving shorter notice if the consent of the holders of NCDs representing not less than 90% of the NCDs remaining outstanding is accorded.  The accidental omission to give notice to, or the non-receipt of notice by, any holder of NCDs or other person to whom it should be given shall not invalidate the proceedings at the meeting.  The NCDs will be subject to any other terms and conditions to be incorporated in the Agreement/Trust Deed(s) to be entered into by the Company with the Trustees and the NCDs Certificates/Allotment Letters that will be issued.

General Terms of the Issue

Market lot

The Equity Shares of the Company currently trades in the ‘T’ group of the BSE. Trades for the Equity Shares of the Company are settled on a trade-to-trade basis on the BSE. The market lot for Equity Shares is 100. In case of holding in physical form, the Company would issue to the allottees one certificate for the Equity Shares allotted to one folio.

The market lot for OCRPS in dematerialised mode is 1. In case of OCRPS allotted in physical form, the Company would issue to the allottee 1 certificate for the OCRPS allotted to each folio.

Joint-holders

Where two or more persons are registered as the holders of any Equity Shares and/ or OCRPS, they shall be deemed to hold the same as joint-holders with benefits of survivorship subject to provisions contained in the Articles of Association of the Company.

Nomination facility

In terms of Section 109A of the Act, nomination facility is available in case of Equity Shares and OCRPS. The applicant can nominate any person by filling the relevant details in the CAF in the space provided for this purpose.

A sole Shareholder or first Shareholder, along with other joint 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 Securities. A Person, being a nominee, becoming entitled to the Securities by reason of the death of the original Security holder(s), shall be entitled to the same rights to which he would be entitled if he were the registered holder of the Securities. Where the nominee is a minor, the Security holder(s) may also make a nomination to appoint, in the prescribed manner, any person to become entitled to the Securities, 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 Securities by the person nominating. A transferee will be entitled to make a fresh nomination in the manner prescribed. When a Security 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

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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/ OCRPS is in dematerialized form, there is no need to make a separate nomination for the Equity Shares/OCRPS to be allotted in this Issue. Nominations registered with respective Depository Participant (“DP”) of the applicant would prevail. If applicants wish to change their nomination, they are requested to inform their respective DP.

Notices

All notices to the Eligible Equity Shareholder(s) and OCRPS holders or holders of NCDs required to be given by our Company shall be published in one English national daily with wide circulation, one Hindi national daily with wide circulation and regional daily with wide circulation, and / or will be sent by ordinary post/registered post/speed post to the registered holders of the Equity Shares/ OCRPS/NCDs from time to time.

Listing and trading of Equity Shares proposed to be issued in the Issue and the Equity Shares arising on conversion of the OCRPS.

The Company’s existing Equity Shares are currently traded on the BSE under the ISIN ‘INE031L01014’. The fully paid up Equity Shares proposed to be issued on a rights basis shall be listed and admitted for trading on the BSE under the existing ISIN for fully paid Equity Shares of the Company. The Company has received in-principle approval pursuant to clause 24(a) of the Listing Agreement from the BSE through letter no. *●+. The fully paid up Equity Shares allotted pursuant to this Issue will be listed as soon as practicable but in no case later than 10 days from the date of allotment.

The equity shares which will arise on conversion of OCRPS shall be listed for trading on the BSE under the existing ISIN for fully paid Equity Shares of the Company. The Equity Shares allotted upon conversion will be listed as soon as practicable but in no case later than 10 days of allotment.

The distribution of the Letter of Offer and the issue of Equity Shares and OCRPS on a rights basis to persons in certain jurisdictions outside India may be restricted by legal requirements prevailing in those jurisdictions.

The Letter of Offer and CAF shall only be dispatched to NR Equity Shareholders with registered addresses in India. The Letter of Offer and CAF should not be forwarded to or transmitted in or into the United States of America or the territories or possessions thereof at any time or to, or for the account or benefit of, “U.S. Persons” (as defined in Regulation S under the United States Securities Act of 1933, as amended)

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Minimum Subscription

If the Company does not receive minimum subscription of 90% of the issue of Equity Shares or OCRPS, individually, or the subscription level falls below 90% after the closure of the Issue on account of cheques having being returned unpaid or withdrawal of applications, the Company shall forthwith refund the subscription amount received for Equity Shares or OCRPS, as the case may be, within fifteen (15) days from the date of the closure of the Issue. If there is a delay in refund of the subscription amount beyond eight days after the date the Company becomes liable to pay such amount (i.e. fifteen (15) days after closure of the Issue), the Company shall pay interest for the delayed period at the rate of 15% per annum, as prescribed under Section 73 of the Companies Act, 1956.

Additional Subscription by the Promoter

India Cements and ICLFSL, vide joint undertaking dated March 29, 2011, have undertaken to:

As such, other than meeting the requirements indicated in the section “Objects of the Issue” on page 30, there is no other intention/purpose for this Issue, including any intention to delist the Company, even if, as a result of allotments to the Promoters and Promoter Group, in this Issue, the cumulative public shareholding of the Company falls below the minimum level as prescribed under the Listing Agreement and, in such an event, we undertake to comply with the Listing Agreement, including the provisions of clause 40A thereof and other applicable laws.

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ISSUE PROCEDURE

The CAF for Equity Shares would be printed in black ink and the CAF for the OCRPS will be printed in blue ink for all Equity Shareholders. In case the original CAF is not received by the applicant 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. For procedure and terms and conditions in relation to application on plain paper, see the section ‘Application on Plain Paper.’ Each CAF(s) consists of four parts: Part A: Form for accepting the Equity Shares/FCDs and for applying for additional Equity Shares/OCRPS; Part B: Form for renunciation; Part C: Form for application for renouncees; and Part D: Form for request for split Application forms.

Acceptance of the Issue

You may accept the Issue and apply for the Securities, either in full or in part by filling 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 banking hours on or before the Issue Closing Date or such extended time as may be specified by the Board of Directors thereof in this regard. Investors at centres not covered by the branches of collecting banks can send their CAF together with the cheque /demand draft, net of bank charges, 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. The applications received through registered post shall be dealt with by the Registrar to the Issue in the normal course.

Offer to Non-Resident Investors

As per Regulation 6 of notification No. FEMA 20/200-RB dated May 3, 2000, RBI has given general permission to Indian companies to issue equity and preference shares to non-resident shareholders. Applications received from NRIs and non-residents for allotment of Securities 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 Securities, issue of letter of allotment, including 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 Securities, payment of dividend etc. to non-resident shareholders. The Equity Shares purchased by non-residents in the Issue shall be subject to the same conditions including restrictions in regard to the repatriability as are applicable to the original Equity Shares against which rights Equity Shares are issued.

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By virtue of Circular No. 14 dated 16th September, 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 Securities. The RBI has however clarified in its circular, A.P. (DIR Series) Circular No. 44, dated 8th December, 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 our Company at its registered office, the OCB shall receive the Draft Letter of Offer and the CAF.

Draft Letter of Offer and CAF shall only be dispatched to non-resident Investors with registered address in India.

Option available to the Equity Shareholders

The Composite Application Form clearly indicates the number of Securities that the Investor is entitled to. If the Investor applies for an investment in the Securities, 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 Securities; • Renounce his Rights Entitlement in full.

Renouncees can apply for the Securities renounced to them and also apply for additional Securities.

Additional Securities

Equity Shareholders are eligible to apply for additional Securities over and above your Rights Entitlement, provided that they have applied for all the Securities offered without renouncing them in whole or in part in favour of any other person(s). Applications for additional Securities shall be considered and allotment shall be made at the sole discretion of the Board, subject to sectoral caps and in consultation if necessary with the Designated Stock Exchange and in the manner prescribed under “Basis of Allotment”.

If you desire to apply for additional Securities, please indicate your requirement in the place provided for additional Securities in Part A of the CAF. The Renouncee applying for all the Securities renounced in their favour may also apply for additional Securities.

Where the number of additional Securities applied for exceeds the number available for allotment, the allotment would be made on a fair and equitable basis in consultation with the Designated Stock Exchange.

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Renunciation

This Issue includes a right exercisable by you to renounce the Securities offered to you either in full or in part in favour of any other person or persons. Your attention is drawn to the fact that our Company shall not allot and/or register the Securities in favour of more than three persons (including joint holders), partnership firm(s) or their nominee(s), minors, HUF(s), any trust or society (unless the same is registered under the Societies Registration Act, 1860 or the Indian Trust Act, 1882 or any other applicable law relating to societies or trusts and is authorized under its constitution or bye laws to hold the Securities, as the case may be).

Any renunciation from resident Indian Shareholder(s) to Non/resident Indian(s) or from Non/resident Indian Shareholder(s) to Resident Indian(s) is subject to the renouncer(s)/Renouncee(s) obtaining the approval of the FIPB and/or necessary permission of the RBI under the FEMA and such permissions should be attached to the CAF. Applications not accompanied by the aforesaid approvals are liable to be rejected.

By virtue of the Circular No. 14 dated 16th September, 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, the existing Equity Shareholders of our Company who do not wish to subscribe to the Securities being offered but wish to renounce the same in favour of Renouncee shall not renounce the same (whether for consideration or otherwise) in favour of OCB(s).

‘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, this will render the application invalid. Submission of the enclosed CAF to the Banker to the Issue at its collecting branches specified on the reverse of the CAF with the form of renunciation (‘Part B’ of the CAF) duly filled in shall be conclusive evidence for our Company of the Renouncees applying for Securities in ‘Part C’ of the CAF to receive allotment of such Securities. The Renouncees applying for all the Securities renounced in their favour may also apply for additional Securities. ‘Part A’ of the CAF must not be used by the Renouncee(s) as this will render the application invalid. Renouncee(s) will have no further right to renounce any Securities in favour of any other person.

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 case of joint renouncees, all joint renouncees must sign this part of the CAF.

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b) To renounce in part or renounce the whole to more than one person(s)

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.

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 Registrar 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 paragraph above shall have to be followed.

In case the signature of the Investor(s), who has renounced the Securities, does not agree with the specimen registered with our Company, the application is liable to be rejected.

Renouncee(s)

The person(s) in whose favour the Securities are renounced should fill in and sign Part C of the Application Form and submit the entire Application Form to the Bankers to the Issue on or before the Issue Closing Date along with the application money.

Change and/ or introduction of additional holders

If you wish to apply for Securities jointly with any other person(s), not more than three, who is/are not already a joint holder 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 shall have to be followed.

However, this right of renunciation is subject to the express condition that the Board of Directors of our Company shall be entitled in its absolute discretion to reject the request for allotment from the Renouncee(s) without assigning any reason thereof.

Instructions for Options

The summary of options available to the Equity Shareholder is presented below. You may exercise any of the following options with regard to the Securities offered, using the enclosed CAF:

Sl. No. Option Available Action Required A Accept whole or part of your entitlement Fill in and sign Part A (All joint holders without renouncing the balance. must sign) B Accept your entitlement in full and apply Fill in and sign Part A including Block III for additional Securities. relating to the acceptance of entitlement and Block IV relating to additional

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Securities (All joint holders must sign). C Renounce your entitlement in full to one Fill in and sign Part B (all joint holders person (Joint renouncees not exceeding must sign) indicating the number of three are considered as one renouncee). Securities renounced and hand over the entire CAF to the renouncee. The renouncees must fill in and sign Part C of the CAF (All joint renouncees must sign). D Accept a part of your entitlement and Fill in and sign Part D (all joint holders renounce the balance to one or more must sign) requesting for Split Application renouncee(s). Forms. Send the CAF to the Registrar to the Issue so as to reach them on or OR before the last date for receiving requests for Split Forms. Splitting will be permitted Renounce your entitlement to all the only once. Securities offered to you to more than one renouncee. On receipt of the Split Form take action as indicated below:

For the Securities you wish to accept, if any, fill in and sign Part A of one split CAF (only for option 1).

For the Securities you wish to renounce, fill in and sign Part B indicating the number of Securities renounced and hand over the split CAFs to the renouncees.

Each of the renouncees should fill in and sign Part C for the Securities accepted by them. E Introduce a joint holder or change the This will be treated as a renunciation. Fill sequence of joint holders in and sign Part B and the renouncees must fill in and sign Part C.

Please note that:

 Part A of the CAF must not be used by any person(s) other than those in whose favour this Issue has been made. If used, this will render the application invalid.

 Request for Split Application Forms should be made for a minimum of one Equity Share or, in either case, in multiples thereof and one Split Application Form for the balance Equity Shares/OCRPS, if any.

 Request by the applicant for the Split Application Form should reach the Registrar to the Issue on or before *●+.

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 Only the person to whom this Draft Letter of Offer has been addressed to and not the renouncee(s) shall be entitled to renounce and to apply for Split Application Forms. Forms once split cannot be split again.

 Split Application Form(s) will be sent to the applicant(s) by post at the applicant’s risk.

Mode of payment for Resident Equity Shareholders / Applicants

All cheques / drafts accompanying the CAF should be drawn in favour of “*●+” and marked ‘A/c Payee only’.

Applicants residing at places other than places where the bank collection centres have been opened by our Company for collecting applications, are requested to send their applications together with Demand Draft of amount net of bank charges, for the full application amount favouring “*●+” and marked ‘A/c Payee only’ payable at Chennai directly to the Registrar to the Issue by registered post so as to reach them on or before the Issue Closing Date. Our Company or the Registrar to the Issue will not be responsible for postal delays or loss of applications in transit, if any.

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:

Application with repatriation benefits

Payment by NRIs / FIIs / foreign investors must be made by demand draft/cheque payable at Chennai or funds remitted from abroad in any of the following ways:

 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.

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 All cheques/drafts submitted by non-residents applying on repatriable basis should be drawn in favour of “*●+” payable at Chennai and 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 the case of NR who remits 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. Our 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.

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 Securities will be on non-repatriation basis.

All cheques/drafts submitted by non-residents applying on non-repatriation basis should be drawn in favour of ‘*●+’ 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.

If the payment is made by a draft purchased from an NRO account, an Account Debit Certificate from the bank issuing the draft, confirming that the draft has been issued by debiting the NRO 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.

New demat account shall be opened for holders who have had a change in status from resident Indian to NRI.

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Note:

 In case where repatriation benefit is available, interest, dividend, sales proceeds derived from the investment in Securities can be remitted outside India, subject to tax, as applicable according to Income Tax Act, 1961.

 In case Securities are allotted on non-repatriation basis, the dividend and sale proceeds of the Securities 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.

Application on Plain Paper

An Equity 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 Issue on plain paper, along with a demand draft net of bank charges, drawn in favour of “*●+” in case of resident shareholders and non-resident shareholders applying on non-repatriable basis and in favour of “*●+” payable at Chennai, in case of non-resident shareholders applying on repatriable basis and send the same by registered post directly to the Registrar to the Issue so as to reach them on or before the closure of the Issue. In such case the demand draft should be payable at Chennai. The envelope should be superscribed “Trinetra Rights Issue - R” in case of resident shareholders and non- resident shareholders applying on non-repatriable basis and in favour of “Trinetra Rights Issue - NR” in case of non-resident shareholders applying on repatriable basis.

The application on plain paper, duly signed by the applicants including joint holders, in the same order as per specimen recorded with our Company, must reach the office of the Registrar to the Issue before the Issue Closing Date and should contain the following particulars:

 Name of Issuer, being Trinetra Cement Limited

 Name and address of the Equity Shareholder including joint holders

 Registered Folio No./ DP ID No. and Client ID No.

 Number of Equity Shares held as on Record Date.

 Certificate numbers and distinctive Nos., if held in physical form.

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 Number of Equity Shares and number of OCRPS entitled to, in the Issue

 Number of rights Equity Shares and number of rights OCRPS applied for

 Number of additional Equity Shares and OCRPS applied for, if any.

 Total number of Equity Shares and OCRPS applied for.

 Total amount paid on application

 Particulars of cheque/draft

 Savings/Current Account Number and name and address of the bank where the Investor will be depositing the refund order.

 PAN number, Income Tax Circle/Ward/District, photocopy of the Pan card/Form 60/ Form 61 declaration and for each Investor in case of joint names.

 Signature of Investors to appear in the same sequence and order as they appear in the records of our Company.

Please note that those who are making the application otherwise than on original CAF shall not be entitled to renounce their rights and should not utilize the original 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. Our Company shall refund such application amount to the applicant without any interest thereon.

Last date of Application

The last date for submission of the duly filled in CAF is *●+. The Issue will be kept open for a minimum of 15 (fifteen) days and the Board or any committee thereof will have the right to extend the said date for such period as it may determine from time to time but not exceeding 30 (thirty) days from the Issue Opening Date.

If the CAF together with the amount payable is not received by the Banker to the Issue/Registrar to the Issue or if the CAF is not received by the SCSB on or before the close of banking hours on the aforesaid last date or such date as may be extended by the Board/Committee of Directors, the offer contained in this Draft Letter of Offer shall be deemed to have been declined and the Board/Committee of Directors shall be at liberty to dispose off the Securities hereby offered, as provided under “Basis of Allotment” below.

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Basis of Allotment

Subject to the provisions contained in the Draft Letter of Offer, the Articles of Association of our Company and the approval of the Designated Stock Exchange, the Board will proceed to allot the Securities in the following order of priority:

a. Full allotment to those Investors who have applied for their Rights Entitlement either in full or in part and also to the Renouncee(s) who has/ have applied for Securities renounced in their favour, in full or in part.

b. Allotment to the Equity Shareholders who having applied for all the Securities offered to them as part of the Issue and have also applied for additional Securities. The allotment of such additional Securities will be made as far as possible on an equitable basis having due regard to the number of Securities held by them on the Record Date, provided there is an undersubscribed portion after making full allotment in (a) and (b) above. The allotment of such Securities 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 will not be a preferential allotment.

c. Allotment to Renouncees who having applied for all the Securities renounced in their favour, have applied for additional Securities provided there is surplus available after making full allotment under (a) and (b) above. The allotment of such Securities 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.

After taking into account allotment to be made under (a) 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 (b) and (c) above.

The Promoters have confirmed that they intend to subscribe to the full extent of their Rights Entitlement in the Issue. Subject to compliance with the Takeover Code, the Promoter and Promoter Group reserve their right to subscribe to the Securities by subscribing for renunciation, if any, made by any other Promoters or Promoter Group or any other shareholders.

India Cements and ICLFSL, have jointly undertaken vide letter dated March 29, 2011 to

(a) apply for the Securities being offered pursuant to the Issue to the extent of our respective Rights Entitlement (as applicable); (b) apply for any Securities renounced in favour of either one of us by any other Promoter Group entity or others; and (c) apply for any additional Securities in the Issue, subject to applicable law, to ensure that 100% of the Issue is subscribed, individually for Equity Shares and OCRPS.

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PROCEDURE FOR APPLICATION THROUGH THE ASBA PROCESS

This section is for the information of the Investors proposing to subscribe to the Issue through the Application Supported by Blocked Amount (“ASBA”) Process. The Company and the Lead Manager are not liable for any amendments or modifications or changes in applicable laws or regulations, which may occur after the date of this Draft Letter of Offer. Investors who are eligible to apply under the ASBA Process are advised to make their independent investigations and to ensure that the CAF is correctly filled up.

The list of banks who have been notified by SEBI to act as SCSB for the ASBA Process are provided on http://www.sebi.gov.in/pmd/scsb.pdf. For details on designated branches of SCSB collecting the CAF, please refer the above mentioned SEBI link.

Shareholders who are eligible to apply under the ASBA Process

The option of applying for Securities in the Issue through the ASBA Process is only available to Equity Shareholders of our Company on the Record Date and who:

• are holding Equity Shares in dematerialised form and has applied towards his/her rights entitlements or additional Securities in the Issue in dematerialised form;

• has not renounced his entitlements in full or in part;

• has not split his CAF;

• are not a Renouncee;

• are applying through blocking of funds in a bank account with one of the SCSBs.

CAF

The Registrar will despatch the CAF to all Equity Shareholders as per their Rights Entitlement on the Record Date for the Issue. Those Equity Shareholders who wish to apply through the ASBA payment mechanism will have to select for this mechanism in Part A of the CAF and provide necessary details.

Equity Shareholders desiring to use the ASBA Process are required to submit their applications by selecting the ASBA Option in Part A of the CAF only. Application in electronic mode will only be available with such SCSB who provides such facility. The Equity Shareholder shall submit the CAF to the SCSB for authorising such SCSB to block an amount equivalent to the amount payable on the application in the said bank account maintained with the same SCSB. Please note, not more than 5 applicants (including both CAF and plain-paper application) can be submitted per bank account in the Issue.

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Acceptance of the Issue

You may accept the Issue and apply for the Securities offered, either in full or in part, by filling Part A of the CAFs sent by the Registrar, selecting the ASBA process option in Part A of the CAF and submit the same to the SCSB 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 of Directors of our Company in this regard.

Mode of payment

The Equity Shareholder applying under the ASBA Process agrees to block the entire amount payable on application (including for additional Securities, if any) with the submission of the CAF, by authorizing the SCSB to block an amount, equivalent to the amount payable on application, in a bank account maintained with the SCSB.

After verifying that sufficient funds are available in the bank account provided in the CAF, the SCSB shall block an amount equivalent to the amount payable on application mentioned in the CAF until it receives instructions from the Registrar to the Issue. Upon receipt of intimation from the Registrar, the SCSBs shall transfer such amount as per Registrar’s instruction allocable to the Equity Shareholders applying under the ASBA Process from bank account with the SCSB mentioned by the Equity Shareholder in the CAF. This amount will be transferred in terms of the SEBI Guidelines, into the separate bank account maintained by our Company as per the provisions of section 73(3) of the Companies Act, 1956. The balance amount remaining after the finalisation of the basis of allotment shall be either unblocked by the SCSBs or refunded to the investors by the Registrar on the basis of the instructions issued in this regard by the Registrar to the Issue and the Lead Manager to the respective SCSB.

The Equity Shareholders applying under the ASBA Process would be required to block the entire amount payable on their application at the time of the submission of the CAF.

The SCSB may reject the application at the time of acceptance of CAF if the bank account with the SCSB details of which have been provided by the Equity Shareholder in the CAF does not have sufficient funds equivalent to the amount payable on application mentioned in the CAF. Subsequent to the acceptance of the application by the SCSB, our Company would have a right to reject the application only on technical grounds.

Options available to the Equity Shareholders applying under the ASBA Process

The summary of options available to the Equity Shareholders is presented below. You may exercise any of the following options with regard to the Securities offered, using the respective CAFs received from Registrar:

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Option Available Action Required Accept whole or part of your entitlement Fill in and sign Part A of the CAF (All joint without renouncing the balance. holders must sign) Accept your entitlement in full and apply for Fill in and sign Part A of the CAF including additional Shares Block III relating to the acceptance of entitlement and Block IV relating to additional Shares (All joint holders must sign)

The Equity Shareholder applying under the ASBA Process will need to select the ASBA option process in the CAF and provide required necessary details. However, in cases where this option is not selected, but the CAF is tendered to the SCSB with the relevant details required under the ASBA process option and SCSB blocks the requisite amount, then that CAF would be treated as if the Equity Shareholder has selected to apply through the ASBA process option.

Additional Securities

You are eligible to apply for additional Securities over and above the number of Securities that you are entitled too, provided that you have applied for all the Securities offered without renouncing them in whole or in part in favour of any other person(s). Applications for additional Securities shall be considered and allotment shall be made at the sole discretion of the Board, in consultation with the Designated Stock Exchange and in the manner prescribed under “Terms of the Issue - Basis of Allotment” on page *●+ of the Draft Letter of Offer.

If you desire to apply for additional Securities please indicate your requirement in the place provided for additional Securities in Part A of the CAF.

Renunciation under the ASBA Process

Renouncees cannot participate in the ASBA Process.

Application on Plain Paper

An Equity Shareholder who has neither received the original CAF nor is in a position to obtain the duplicate CAF and who is applying under the ASBA Process may make an application to subscribe to the Issue on plain paper. The application on plain paper, duly signed by the applicant including joint holders, in the same order as per specimen recorded with our Company, must be submitted at a designated branch of a SCSB on or before the Issue Closing Date and should contain the following particulars:

 Name of Issuer, being Trinetra Cement Limited;

 Name and address of the Equity Shareholder, including joint holders;

 DP and Client ID no.;

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 Number of Equity Shares held as on Record Date;

 Number of Securities entitled to;

 Number of Securities applied for;

 Number of additional Securities applied for, if any;

 Total number of Securities applied for;

 Savings/Current account number along with the name of the SCSB and address of the branch from which the money will be blocked. In case of Non-Resident Investors, NRE/FCNR/NRO a/c no., name of the SCSB and address of the branch;

 Particulars of cheque/draft; and

 Except for applications on behalf of the Central or State Government and the officials appointed by the courts, PAN number of the Investor and for each Investor in case of joint names, irrespective of the total value of the Securities applied for pursuant to the Issue.

Option to receive Securities in Dematerialized Form

SHAREHOLDERS UNDER THE ASBA PROCESS MAY PLEASE NOTE THAT THE SECURITIES OF THE COMPANY UNDER THE ASBA PROCESS CAN ONLY BE ALLOTTED IN DEMATERIALIZED FORM AND TO THE SAME DEPOSITORY ACCOUNT IN WHICH THE EQUITY SHARES ARE BEING HELD ON RECORD DATE.

General instructions for Equity Shareholders applying under the ASBA Process

a. Please read the instructions printed on the respective CAF carefully.

b. Application should be made on the printed CAF 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. The CAF must be filled in English.

c. The CAF in the ASBA Process should be submitted at a Designated Branch of the SCSB and whose bank account details are provided in the CAF and not to the Bankers to the Issue/Collecting Banks (assuming that such Collecting Bank is not a SCSB), to our Company or Registrar or Lead Manager to the Issue.

d. All applicants, and in the case of application in joint names, each of the joint applicants, should mention his/her PAN number allotted under the Income-Tax Act, 1961, irrespective of the amount of the application. CAFs without PAN will be considered incomplete and are liable to be rejected.

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e. All payments will be made by blocking the amount in the bank account maintained with the SCSB. Cash payment is not acceptable. In case payment is affected in contravention of this, the application may be deemed invalid and the application money will be refunded and no interest will be paid thereon.

f. Signatures should be either in English or Hindi or in any other language specified in the Eighth 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 official seal. The Equity Shareholders must sign the CAF as per the specimen signature recorded with our Company or Depositories.

g. 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 our Company. 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.

h. All communication in connection with application for the Securities, 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 Shareholder, folio numbers and CAF number.

i. Only the person or persons to whom Securities have been offered and not renouncee(s) shall be eligible to participate under the ASBA process.

Do’s:

a. Ensure that the ASBA Process option is selected in part A of the CAF and necessary details are filled in. In case of non-receipt of the CAF, the application can be made on plain paper indicating the application through ASBA payment mechanism with all necessary details as indicated under the heading “Application on Plain Paper” in this section.

b. Ensure that you submit your application in physical mode only. Electronic mode is only available with certain SCSBs and not all SCSBs and you should ensure that your SCSB offers such facility to you.

c. Ensure that the details about your Depository Participant and beneficiary account are correct and the beneficiary account is activated as Securities will be allotted in the dematerialized form only.

d. Ensure that the CAFs are submitted at the SCSBs whose details of bank account have been provided in the CAF.

e. Ensure that you have mentioned the correct bank account number in the CAF.

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f. Ensure that there are sufficient funds for subscription to both Equity Shares and OCRPS subscribed for, available in the bank account maintained with the SCSB mentioned in the CAF before submitting the CAF to the respective Designated Branch of the SCSB.

g. Ensure that you have authorised the SCSB for blocking funds equivalent to the total amount payable on application mentioned in the CAF, in the bank account maintained with the respective SCSB, of which details are provided in the CAF and have signed the same.

h. Ensure that you receive an acknowledgement from the SCSB for your submission of the CAF in physical form.

i. Each applicant should mention their Permanent Account Number (“PAN”) allotted under the Income Tax Act.

j. Ensure that the name(s) given in the CAF is exactly the same as the name(s) in which the beneficiary account is held with the Depository Participant. In case the CAF is submitted in joint names, ensure that the beneficiary account is also held in same joint names and such names are in the same sequence in which they appear in the CAF.

k. Ensure that the Demographic Details are updated, true and correct, in all respects.

Don’ts:

a. Do not apply on duplicate CAF after you have submitted a CAF to a Designated Branch of the SCSB.

b. Do not pay the amount payable on application in cash, by money order or by postal order.

c. Do not send your physical CAFs to the Lead Manager to Issue / Registrar / Collecting Banks (assuming that such Collecting Bank is not a SCSB) / to a branch of the SCSB which is not a Designated Branch of the SCSB / Company; instead submit the same to a Designated Branch of the SCSB only.

d. Do not submit the GIR number instead of the PAN as the application is liable to be rejected on this ground.

e. Do not instruct your respective banks to release the funds blocked under the ASBA Process.

f. Do not make an application on a split form.

g. Do not submit more than 5 applications (through CAF or plain paper) per bank account maintained with an SCSB for the Issue.

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Grounds for Technical Rejection under the ASBA Process

In addition to the grounds listed under “Grounds for Technical Rejection” on page *●+ of this Draft Letter of Offer, applications under the ASBA Process are liable to be rejected on the following grounds: a. Application for entitlements or additional Securities in physical form. b. DP ID and Client ID mentioned in CAF not matching with the DP ID and Client ID records available with the Registrar. c. Sending CAF to a Lead Manager / Registrar / Collecting Bank (assuming that such Collecting Bank is not a SCSB) / to a branch of a SCSB which is not a Designated Branch of the SCSB / Company. d. Renouncee applying under the ASBA Process. e. Insufficient funds are available with the SCSB for blocking the amount. f. Funds in the bank account with the SCSB whose details are mentioned in the CAF having been frozen pursuant to regulatory orders. g. Account holder not signing the CAF or declaration mentioned therein.

Depository account and bank details for Equity Shareholders applying under the ASBA Process

IT IS MANDATORY FOR ALL THE EQUITY SHAREHOLDERS APPLYING UNDER THE ASBA PROCESS TO RECEIVE THEIR SECURITIES IN DEMATERIALISED FORM. ALL EQUITY SHAREHOLDERS APPLYING UNDER THE ASBA PROCESS SHOULD MENTION THEIR DEPOSITORY PARTICIPANT’S NAME, DEPOSITORY PARTICIPANT IDENTIFICATION NUMBER AND BENEFICIARY ACCOUNT NUMBER IN THE CAF. EQUITY SHAREHOLDERS APPLYING UNDER THE ASBA PROCESS MUST ENSURE THAT THE NAME GIVEN IN THE CAF IS EXACTLY THE SAME AS THE NAME IN WHICH THE DEPOSITORY ACCOUNT IS HELD. IN CASE THE CAF IS SUBMITTED IN JOINT NAMES, IT SHOULD BE ENSURED THAT THE DEPOSITORY ACCOUNT IS ALSO HELD IN THE SAME JOINT NAMES AND ARE IN THE SAME SEQUENCE IN WHICH THEY APPEAR IN THE CAF.

Equity Shareholders applying under the ASBA Process should note that on the basis of name of these Equity Shareholders, Depository Participant’s name and identification number and beneficiary account number provided by them in the CAF, the Registrar to the Issue will obtain from the Depository demographic details of these Equity Shareholders such as address, bank account details for printing on refund orders and occupation (“Demographic Details”). Hence, Equity Shareholders applying under the ASBA Process should carefully fill in their Depository Account details in the CAF.

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These Demographic Details would be used for all correspondence with such Equity Shareholders including mailing of the letters intimating unblock of bank account of the respective Equity Shareholder. The Demographic Details given by Equity Shareholders in the CAF would not be used for any other purposes by the Registrar. Hence, Equity Shareholders are advised to update their Demographic Details as provided to their Depository Participants.

By signing the CAFs, the Equity Shareholders applying under the ASBA Process would be deemed to have authorised the Depositories to provide, upon request, to the Registrar to the Issue, the required Demographic Details as available on its records.

Letters intimating allotment and unblocking or refund (if any) would be mailed at the address of the Equity Shareholder applying under the ASBA Process as per the Demographic Details received from the Depositories. Refunds, if any, will be made directly to the bank account in the SCSB and which details are provided in the CAF and not the bank account linked to the DP ID. Equity Shareholders applying under the ASBA Process may note that delivery of letters intimating unblocking of bank account may get delayed if the same once sent to the address obtained from the Depositories are returned undelivered. In such an event, the address and other details given by the Equity Shareholder in the CAF would be used only to ensure dispatch of letters intimating unblocking of bank account.

Note that any such delay shall be at the sole risk of the Equity Shareholders applying under the ASBA Process and none of the Company, the SCSBs or the Lead Manager shall be liable to compensate the Equity Shareholder applying under the ASBA Process for any losses caused due to any such delay or liable to pay any interest for such delay.

In case no corresponding record is available with the Depositories that matches three parameters, namely, names of the Equity Shareholders (including the order of names of joint holders), the DP ID and the beneficiary account number, then such applications are liable to be rejected.

DISPOSAL OF APPLICATIONS AND APPLICATION MONEYS AND INTEREST IN CASE OF DELAY IN INSTRUCTIONS TO SCSB BY THE REGISTRAR TO THE ISSUE

In accordance with the Companies Act, the requirements of the Stock Exchanges and SEBI Guidelines, our Company undertakes that:

• Allotment and transfer shall be made only in dematerialised form within 15 days from the Issue Closing Date;

• Instructions for unblocking of the ASBA shareholder’s Bank Account shall be made within 15 days from the Issue Closing Date; and

• If the instructions to SCSB to unblock funds in the ASBA accounts are not given within 8 days after our Company becomes liable to repay all moneys received from the applicants in

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pursuance of this Draft Letter of Offer, i.e. within 15 days from the Issue Closing Date, then our Company and every Director of our Company who is an officer in default shall, on and from such expiry of 8 days, be liable to repay the money, with interest at the rate of 15% per annum, as prescribed under Section 73 of the Companies Act.

In case no corresponding record is available with the Depositories that matches three parameters, namely, names of the Shareholders (including the order of names of joint holders), the DP ID and the beneficiary account number, then such applications are liable to be rejected.

Disposal of Investor Grievances

All grievances relating to the ASBA process may be addressed to the Registrar to the Issue, with a copy to the SCSB, giving full details such as name, address of the applicant, number of Securities applied for, Amount blocked on application, bank account number and the Designated Branch or the collection centre of the SCSB where the Application Form was submitted by the ASBA shareholder.

Underwriting

The present Issue is not underwritten.

Allotment / Refund

Our Company will issue and dispatch allotment advice/ 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 15 days from the Issue Closing Date. If such money is not repaid within eight days from the day our Company becomes liable to repay it, (i.e. 15 days after the Issue Closing Date or the date of the refusal by the Stock Exchange(s), whichever is earlier) our Company and every Director of our Company who is an officer in default shall, on and from expiry of eight days, be jointly and severally liable to pay the money with interest at the rate of 15% per annum, as prescribed under Section 73 of the Companies Act.

Investors residing at centres where clearing houses are managed by the Reserve Bank of India (“RBI”) will get refunds through Electronic Clearing Service (“ECS”) except where Investors are otherwise disclosed as applicable/eligible to get refunds through direct credit and Real Time Gross Settlement (“RTGS”).

In case of those Investors who have opted to receive their Rights Entitlement in dematerialized form using electronic credit under the depository system, advice regarding their credit of the Securities shall be given separately. Investors to whom refunds are made through electronic transfer of funds will be sent a letter through ordinary post intimating them about the mode of credit of refund within 15 days of the Issue Closing Date.

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In case of those Investors who have opted to receive their Rights Entitlement in physical form and our Company issues letter 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 Company Law Board under Section 113 of the Companies Act or other applicable provisions, if any. Investors are requested to preserve such letters of allotment, which would be exchanged later for the share certificates. For more information, please see the section “Terms of the Issue” on page 177 of the Draft Letter of Offer.

The letter of allotment / refund order would be sent by registered post/speed post to the sole/first Investors registered address. Such refund orders would be payable at par at all places where the applications were originally accepted. The same would be marked ‘Account Payee only’ and would be drawn in favour of the sole/first Investor. Adequate funds would be made available to the Registrar to the Issue for this purpose.

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 demand 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 exchange rate prevailing at such time. Our Company will not be responsible for any loss on account of exchange rate 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.

Mode of Making Refunds

The payment of refund, if any, would be done through various modes in the following order of preference:

1. ECS – Payment of refund would be done through ECS for applicants having an account at any of the 68 centres where clearing houses for ECS are managed by the Reserve Bank of India, State Bank of India, Punjab National Bank, Union Bank of India, Andhra Bank, Corporation Bank, Bank of Baroda, State Bank of Travancore, Central Bank of India, Canara Bank, Oriental Bank of Commerce, United Bank of India, State Bank of Hyderabad and State Bank of Bikaner and Jaipur. This mode of payment of refunds would be subject to availability of complete bank account details including the nine digit Magnetic Ink Character Recognition (MICR) code as appearing on a cheque leaf, from the depository. The payment of refund through ECS is mandatory for applicants having a bank account at any of the 68 centres, except where applicant is otherwise disclosed as eligible to get refunds through direct credit or RTGS.

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2. NEFT (National Electronic Fund Transfer) – Payment of refund shall be undertaken through NEFT wherever the applicants’ bank has been assigned the Indian Financial System Code (IFSC), which can be linked to a Magnetic Ink Character Recognition (MICR), if any, available to that particular bank branch. IFSC Code will be obtained from the website of RBI as on a date immediately prior to the date of payment of refund, duly mapped with MICR numbers. Wherever the applicants have registered their nine digit MICR number and their bank account number while opening and operating the demat account, the same will be duly mapped with the IFSC Code of that particular bank branch and the payment of refund will be made to the applicants through this method.

3. Direct Credit – Applicants having their bank account with the Refund Banker, i.e. *●+ shall be eligible to receive refunds, if any, through direct credit. The refund amount, if any, would be credited directly to the eligible applicant’s bank account with the Refund Banker.

4. RTGS – Applicants having a bank account at any of the 68 centres detailed above, and whose application amount exceeds Rs. 1 million, shall be eligible to exercise the option to receive refunds, if any, through RTGS. All applicants eligible to exercise this option shall mandatorily provide the IFSC code in the CAF, the refund shall be made through the ECS or direct credit, if eligibility disclosed.

5. For all other Investors, including those who have not updated their bank particulars with the MICR code, the refund orders will be dispatched through speed post / registered post. Such refunds will be made by cheques, pay orders or demand drafts drawn in favour of the sole / first Investor and payable at par.

6. Credit of refunds to Investors in any other electronic manner permissible under the banking laws, which are in force, and is permitted by the SEBI from time to time.

Printing of Bank Particulars on Refund Orders

As a matter of precaution against possible fraudulent encashment of refund orders due to loss or misplacement, the particulars of the applicant’s bank account are mandatory for printing on the refund orders. Bank account particulars will be printed on the refund orders which can then be deposited only in the account specified. Our Company will in no way be responsible if any loss occurs through these instruments falling into improper hands either through forgery or fraud.

Letters of Allotment / Share Certificates / Demat Credit

Allotment advice / share certificates / demat credit will be dispatched to the registered address of the first named Investor or respective beneficiary accounts will be credited within 15 (fifteen) days, from the Issue Closing Date. In case our Company issues allotment advice, the relative shared certificates will be dispatched within one month from the date of the allotment.

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Allottees are requested to preserve such allotment advice (if any) to be exchanged later for share certificates.

Option to receive Securities in Dematerialized Form

Applicants to the Securities of our Company issued through this Issue shall be allotted the securities in dematerialized (electronic) form at the option of the applicant. Our Company has signed the following tripartite agreements to enable the Investors to hold and trade in securities in a dematerialized form, instead of holding the securities in the form of physical certificates:

- Agreement dated April 16, 2010 with NSDL and Integrated Enterprises (India) Limited

- Agreement dated April 27, 2010 with CDSL and Integrated Enterprises (India) Limited

In this Issue, the allottees who have opted for Securities in dematerialized form will receive their Securities in the form of an electronic credit to their beneficiary account with a depository participant. The CAF shall contain space for indicating number of shares applied for in demat and physical form or both. 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 our Company, allotted pursuant to the Issue, will be listed on the BSE. The OCRPS allotted pursuant to the Issue shall not be listed on any stock exchanges. However, the Equity Shares or NCDs, allotted pursuant to conversion of OCRPS shall be listed and traded on the stock exchanges in which the Equity Shares of the Company are listed then.

INVESTORS MAY PLEASE NOTE THAT THE EQUITY SHARES OF THE COMPANY CAN BE TRADED ON THE STOCK EXCHANGES ONLY IN DEMATERIALIZED FORM.

Procedure for availing the facility for allotment of Securities in this Issue in the electronic form is as under:

- 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 our Company. In the case of joint holding, the beneficiary account should be opened carrying the names of the holders in the same order as with our Company). In case of Investors having various folios in our Company with different joint holders, the Investors will have to open separate accounts for such holdings. Those Equity Shareholders who have already opened such Beneficiary Account (s) need not adhere to this step.

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- For Investors holding Equity Shares of our Company in dematerialized 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 Securities 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 Securities may be made in dematerialized form even if the original Equity Shares of our Company are not dematerialized. Nonetheless, it should be ensured that the Depository Account is in the name(s) of the Equity Shareholders and the names are in the same order as in the records of our Company.

Responsibility for correctness of information (including applicant’s age and other details) filled in the CAF vis-à-vis such information 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 the same as registered with the applicant’s depository participant.

If incomplete / incorrect beneficiary account details are given in the CAF, or where the Investor does not opt to receive the Securities in dematerialized form, the Investor will get Securities in physical form.

The Securities allotted to Investors who have opted for them in the dematerialized 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 Registrar to the Issue but the applicant’s depository participant will provide to him the confirmation of the credit of such Securities to the applicant’s depository account.

Renouncees will also have to provide the necessary details about their beneficiary account for allotment of securities in this Issue. In case these details are incomplete or incorrect, the application is liable to be rejected.

Option to subscribe

Other than the present Issue, and except as disclosed in ‘Terms of the Issue’ on page 177, our Company has not given any person any option to subscribe to the Securities of our Company. The Investors shall have an option either to receive the security certificates or to hold the securities in dematerialised form with a depository.

Utilization of Proceeds

Subscription received against this Issue will be kept in a separate bank account(s) and our Company would not have access to such funds unless the basis of allotment approved by the Designated Stock Exchange.

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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 our Company except as mentioned under the head Application on Plain Paper 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, and 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 our Company or Lead Manager to the Issue. Applicants residing at places other than cities where the branches of the Bankers to the Issue have been authorized by our Company for collecting applications, will have to make payment by Demand Draft payable at Chennai of amount net of bank and postal charges, 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 any value made by the Investor, or in the case of joint names, each of the joint Investors, should mention his / her PAN number allotted under the Income-Tax Act, 1961, irrespective of the amount of the application. CAF without PAN will be considered incomplete and are liable to be rejected. e. Bank Account Details: It is mandatory for applicants to provide information as to their savings/current account number and the name of the Bank 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. For Equity Shareholders holding Equity Shares in dematerialised form, such bank details will be drawn from the demographic details of the Eligible Equity Shareholder in the records of the Depository. f. All payments should be made by cheque / DD only. Cash payment is not acceptable. 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. g. Signatures should be either in English or Hindi or in any other language specified in the Eighth 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

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under his/ her official seal. The Equity Shareholders must sign the CAF as per the specimen signature recorded with our Company or depositories. 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 the above-referred documents are already registered with our Company, the same need not be a furnished again. 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. In no case should these papers be attached to the application submitted to the Bankers to the Issue. 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 our 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 Securities 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 Investor 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 Securities, including any change in address of the Investors 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 Investor, folio numbers and CAF number. Please note that any intimation for change of address of Investor, after the date of allotment, should be sent (i) in the case of Securities held in physical form, to the Registrar to the Issue (also the Share Transfer Agent of the Company) at its office and (ii) in case of Securities held in dematerialized form, to the respective depository participant. l. Split forms cannot be re-split. m. Only the person or persons to whom Securities have been offered shall be entitled to obtain split forms, but not renouncee(s). n. Applicants must write their CAF number at the back of the cheque / demand draft.

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o. Only one mode of payment per application should be used. The payment must be 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 centre 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 post-dated 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.

Grounds for Technical Rejections

Applicants are advised to note that applications are liable to be rejected on technical grounds, including the following:

 Amount paid does not tally with the amount payable for;

 Bank account details (for refund) are not given;

 Age of first applicant not given;

 PAN not mentioned for application of any value;

 In case of Application under power of attorney or by limited companies, corporate, trust, etc., relevant documents are not submitted;

 If the signature of the existing shareholder does not match with the one given on the CAF and for renouncees if the signature does not match with the records available with their depositories;

 If the Investor desires to have the Securities in electronic form, but the CAF does not have the Investor’s depository account details;

 CAFs are not submitted by the Investors within the time prescribed as per the Letter of Offer and the CAF;

 CAFs not duly signed by the sole/joint Applicants;

 Applications by OCBs unless accompanied by specific approval from the RBI permitting the OCBs to invest in the Issue;

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 Applications accompanied by Stockinvest;

 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;

 Applications by ineligible Non-residents (including on account of restriction or prohibition under applicable local laws) and where last available address in India has not been provided;

 Applications that do not include the certification set out in the CAF to the effect that the subscriber is not a U.S. Person and is purchasing the Securities in an “offshore transaction” (as defined in Regulation S), and is authorized to acquire the Securities in compliance with all applicable laws and regulations; and where a registered address in India has not been provided;

 Applications which have evidence of being executed in / dispatched from the US;

 Applications where our Company believes that the CAF is incomplete or acceptance of such CAF may infringe applicable legal or regulatory requirements;

 Multiple applications, including where an applicant submits a CAF and a plain paper application;

 Duplicate Applications, including cases where an investor submits CAFs along with plain paper applications; and

 Applications by Renouncees who are persons not competent to contract under the Indian Contract Act, 1872, including minors.

Payment by Stockinvest

In terms of RBI Circular DBOD No. FSC BC 42/24.47.00/2003- 04 dated 5th November, 2003, the Stockinvest Scheme has been withdrawn. Hence, payment through Stockinvest would not be accepted in this Issue.

Disposal of application and application money

No acknowledgment will be issued for the application moneys received by our 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 thereof.

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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 Securities allotted, will be refunded to the applicant within 15 days from the close of the Issue in accordance with section 73 of the Act.

For further instruction, please read the Composite Application Form (CAF) carefully.

Utilization of Issue Proceeds

The Board of Directors declares that:

1. The funds received against this Issue will be transferred to a separate bank account as per sub-section (3) of Section 73 of the Act.

2. Details of all moneys utilized out of the Issue shall be disclosed under an appropriate separate head in the balance sheet of our Company indicating the purpose for which such money has been utilized.

3. Details of all such unutilized moneys out of the Issue, if any, shall be disclosed under an appropriate head in the balance sheet of our Company indicating the form in which such unutilized moneys have been invested.

4. Our Company may utilize the funds collected in the Issue only after the basis of allotment is finalized.

Undertakings by our Company

1. The complaints received in respect of the Issue shall be attended to by our Company expeditiously and satisfactorily.

2. All steps for completion of the necessary formalities for listing and commencement of trading at the BSE, where the securities are to be listed will be taken within seven working days of finalization of basis of allotment.

3. Our Company shall take adequate steps for the listing of Equity Shares and Non-Convertible Debentures resulting from the conversion of the OCRPS, if any.

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

5. That where refunds are made through electronic transfer of funds, a suitable communication shall be sent to the applicant within 15 days of closure of the issue, as the case may be, giving details of the bank where refunds shall be credited along with amount and expected date of electronic credit of refund.

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6. The certificates of the Securities/ refund orders for resident Indian Investors shall be dispatched within the specified time. Certificates of the Securities/refund orders of the Non- Resident Investors shall be dispatched within the specified time subject to receipt of approval from RBI/FIPB, if required;

7. Our Company accepts full responsibility for the accuracy of information given in this Draft 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 Draft Letter of Offer misleading and further confirms that it has made all reasonable enquiries to ascertain such facts.

8. Except as disclosed, no further issue of securities affecting equity capital of our 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.

9. Adequate arrangements shall be made to collect all ASBA applications and to consider then similar to non-ASBA applications while finalising the Basis of Allotment.

10. All information shall be made available by the Lead Manager 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.

11. At any given time, there shall be only one denomination of the Equity Shares of our Company and our Company shall comply with such disclosure and accounting norms specified by SEBI from time to time.

Minimum Subscription

If our Company does not receive minimum subscription of 90% of the Issue (separately for Equity Shares and OCRPS) or the subscription level falls below 90% for each Equity Shares and OCRPS separately after the Issue Closing Date, on account of cheques being returned unpaid or withdrawal of applications our Company shall forthwith refund the entire subscription amount received in respect of the Equity Shares or OCRPS, as the case may be, within 15 days from the Issue Closing Date. If there is a delay in the refund of subscription by more than eight days after the Company becomes liable to pay the subscription amount (i.e. 15 days after closure of the Issue), the Company will pay interest at the rate of 15% per annum, as prescribed under subsections (2) and (2A) of Section 73 of the Companies Act, 1956.

Investors are requested to note that non-receipt of minimum subscription of Equity Shares offered pursuant to the Issue shall not influence allotment of OCRPS offered pursuant to the Issue, and vice-versa.

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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 Investor as mentioned on the CAF and superscribed “Trinetra Cement Limited – Rights Issue” on the envelope) to the Registrar to the Issue at the following address:

M/s. Integrated Enterprises (India) Limited 2nd Floor, Kences Towers No. 1, Ramakrishna Street North Usman Road, T Nagar Chennai – 600 017 Tel: +91 44 2814 0801/2/3 Fax: +91 44 2814 2479 Email: [email protected]

It is to be specifically noted that this Issue of Securities is subject to the section entitled “Risk Factors” beginning on page 10 of this Draft Letter of Offer.

The Company will not be liable for any postal delays and applications received through mail after the closure of the Issue are liable to be rejected and returned to the applicants.

The Issue will remain open for at least 15 days. However, the Board will have the right to extend the Issue period as it may determine from time to time but not exceeding 30 days from the Issue Opening Date.

We reserve the right not to proceed with the Issue after the bidding and if so, the reason thereof shall be given as a public notice within two days of the closure of the Issue. The public notice shall be issued in the same newspapers where the pre-issue advertisement had appeared. BSE, where the Equity Shares were proposed to be listed shall also be informed promptly.

In case we withdraw the Issue after closure of bidding, we shall be required to file a fresh Draft Letter of Offer with SEBI.

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MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION Capitalised terms used in this section have the meaning that has been given to such terms in the Articles of Association. Pursuant to Schedule II of the Companies Act, 1956 and SEBI Regulations, the main provisions of the Articles of Association of the Company are set forth below. Please note that each provision below is numbered as per the corresponding article number in the Articles of Association.

TABLE ‘A’ TO APPLY

Article 1

The regulations contained in Table ‘A’ of the Schedule of the Companies Act, 1956 shall apply to this Company unless specifically referred to as not applicable or modified herein below.

SHARE CAPITAL AND VARIATION OF RIGHTS

Article 2

(a) The Authorised Share Capital of the Company shall be as stated in Clause V (a) of the Memorandum of Association of the Company.

(b) Subject to the rights of the holders of any other shares entitled by the terms of issue of preferential repayment over equity shares in the event of winding up of the Company, holders of the equity shares shall be entitled to be repaid the amount of capital paid up or credited as paid up on such equity shares and all surplus assets thereafter shall belong to the holders of the equity shares in proportion to the amount paid up or credited as paid up on such equity shares respectively at the commencement of the winding up.

(c) Subject to the provisions of section 80, any preference shares may be issued on the terms that they are, or at the option of the Company are liable, to be redeemed on such terms and in such manner as the Board may determine.

Article 3

Subject to the provisions of the Act and these Articles the shares shall be under the control of the Board of Directors and they may allot or otherwise dispose of the same to such persons on such terms and conditions and either at premium or at discount (subject to Section 78 and 79 of the Act) and at such times as the Directors may think fit.

Article 4

Option or right to call of shares shall not be given to any person or persons except with the sanction of the Company in General Meeting.

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Article 8

Where two or more persons are registered as holders of any shares, they shall be deemed to hold the same as joint-tenants with benefit of survivorship subject to the provisions following and to the other provisions of these Articles relating to joint-holders:-

(a) The Company shall not be bound to register more than three persons as the joint- holders of any shares.

(b) The joint-holders of a share shall be liable severally as well as jointly in respect of all payments which ought to be made in respect of such shares.

(c) On the death of any such joint-holders, the survivor or survivors shall be the only person/persons recognized by the Company as having any title to or interest in such shares but the Board may require such evidence of death as it may deem fit.

(d) Only the person whose name stands first in the Register as one of the joint holders of any shares shall be entitled to delivery of the certificate relating to such shares.

Article 9

The Company may from time to time by special resolution, subject to confirmation by the Court and subject to the provisions of section 100 to 104 of the Act, reduce its share capital in any way and in particular without prejudice to the generality of the foregoing power by:

(a) Extinguishing or reducing the liability on any of its shares in respect of share capital not paid up; or

(b) Either with or without extinguishing or reducing liability on any of its shares, cancel any paid up share capital which is lost or unrepresented by available assets; or

(c) Either with or without extinguishing or reducing liability on any of its shares pay off any paid up share capital which is in excess of the wants of the Company and

(d) Capital may be paid off upon the footing that it may be called up again or otherwise and paid up capital may be cancelled as aforesaid without reducing the nominal amount of shares by the like amount to the extent that the unpaid and callable capital shall be increased by the like amount and may, if and so far as is necessary alter its Memorandum by reducing the amount of its share capital and of its shares accordingly.

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CALLS

Article 10

The Board may from time to time make calls upon the members in respect of any money unpaid on their shares on such terms and conditions as the Board may deem fit and the Board may at its discretion also alter, vary, extend, amend, revoke, postpone or cancel such conditions terms etc. as may be desired in a particular case or in general and each member shall pay to the Company at the time or times specified in the notice making such call the amount called on his shares. The proviso to Regulation 13(1) of Table ‘A’ shall not apply to the Company.

Article 11

Regulation 16(1) of Table ‘A’ shall not apply to the Company and if a sum called in respect of a share is not paid before or on the day appointed for the payment thereof the person from whom the sum is due shall pay interest thereon from the day appointed for payment thereof to the time of actual payment at such rate of interest as the Board may determine from time to time, Money paid in advance of calls shall not in respect thereof confer the rights to dividend or to participate in the profits of the Company.

Article 12

Every member, or his heirs, executors or administrators, shall pay to the Company the portion of capital represented by his share or shares which may, for the time being remain unpaid thereon, in such amount, at such time or times and in such manner as the Board shall, from time to time in accordance with the Company’s regulations require or fix for the payment thereof.

CONSIDERATION FOR ALLOTMENT

Article 13

The Board may, subject to the provisions of the Act and these Articles allot and issue shares in the capital of the Company as consideration of any property sold or transferred for services rendered to the Company in the conduct of the business and any shares which may be so issued shall be deemed to be partly or fully paid up shares as the case may be.

Article 14

Where any shares are issued for the purpose of raising money to defray the expenses of the construction of any work of building or the provision of any plant, which cannot be made profitable for a lengthy period, the company may pay interest on such of that share capital as is for the time being paid up for the period at the rate and subject to the conditions and restrictions provided by section 208 of the Act, and may charge the same to capital as part of the cost of construction of the work or building or the provisions of plant.

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FORFEITURE OF SHARES

Article 15

Neither receipt by the Company of portion of any money which shall from time to time be due from any member to the Company in respect of his shares, either by way of principal or interest nor any indulgence granted by the Company in respect of the payment of any such money shall preclude the Company from thereafter proceeding to enforce forfeiture of such shares as provided.

Article 16

The Company shall have a first and paramount lien upon all the shares (other than fully paid-up shares) registered in the name of each member (whether solely or jointly with others) and upon the proceeds of sale thereof for all moneys (whether presently payable or not) called or payable at a fixed time in respect of such shares and no equitable interest in any shares shall be created except upon the footing and condition that these article will have full effect. And such lien shall extend to all dividends and bonuses from time to time declared in respect of such shares. Unless otherwise agreed the registration of a transfer of shares shall operate as a waiver of the Company’s lien if any, on such shares. The Directors may at any time declare any shares wholly or in part to be exempt from the provisions of this clause.

Article 16B

Dematerialisation of Securities:

Notwithstanding anything contained in these Articles, the Company shall be entitled to dematerialise or rematerialize its shares, debentures and other securities (both existing and future) held by it with the Depository and to offer its shares, debentures and other securities for subscription in a dematerialised form pursuant to the Depositories Act, 1996 and the Rules framed thereunder, if any;

Article 16C

Option for Investors:

Every person subscribing to securities offered by the Company shall have the option to receive the security certificates or to hold the securities with a Depository. Such a person who is the beneficial owner of the securities can at any time opt out of a Depository, if permitted by law, in respect of any security in the manner provided by the Depositories Act, and the Company shall, in the manner and within the time prescribed, issue to the beneficial owner the required certificates of securities.

Where a person opts to hold his security with a Depository, the Company shall intimate such Depository the details of allotment of the security, and on receipt of such information, the

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Depository shall enter in its record the name of the allottee as the beneficial owner of the security.

Article 16D

Securities in Depositories to be in fungible form:

All securities held by a Depository shall be dematerialized and shall be in a fungible form. Nothing contained in Section 153, 153A, 153 B, 187 A, 187 B, 187 C and 372 of the Act shall apply to a Depository in respect of the securities held by it on behalf of the beneficial owners;

Article 16E

Rights of depositories and Beneficial Owners: i. Notwithstanding anything to the contrary contained in the Act of these Articles, a Depository shall be deemed to be the registered owner for the purposes of effecting transfer of ownership of security on behalf of the beneficial owner; ii. Save as otherwise provided in (i) above, the Depository as a registered owner of the securities shall not have any voting rights or any other right in respect of the securities held by it; iii. Every person holding securities of the Company and whose name is entered as a beneficial owner in the records of he depository shall be deemed to be a member of the Company.

The beneficial owner of the securities shall be entitled to all the rights and benefits and to subject to all the liabilities in respect of his securities held by a depository.

Article 16I

The Register and Index of Beneficial Owners, maintained by Depository under Section 11 of the Depositories Act shall be deemed to be the Register and Index of Members and security holders as the case may be for the purpose of these Articles.

Article 17

Unpaid or unclaimed dividend, share application refund money etc.

No unclaimed or unpaid dividend shall be forfeited and the Company shall comply with the provisions of Section 205A and 205B read with section 205 C of the Act or rules made thereunder in respect of any dividend remaining unpaid or unclaimed with the Company.

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The Company shall with the provisions of Section 205 C of the Act, in respect of any money remaining unpaid with the Company in the nature of

i. Application moneys received by the Company for allotment of any securities and due for refund; ii. Deposit received by the Company and due for repayment; iii. Debentures issued by the Company and matured for redemption; and iv. The interest, if any, accrued on the amounts referred at items (i) to (iii) respectively.

TRANSFER AND TRANSMISSION OF SHARES

Article 18

Regulation 19 to 23 of Table A shall not apply to the Company.

Article 19

The instruments of transfer shall be in writing and all the provisions of Section 108 of the Companies Act and of any statutory modification there of for the time being shall be duly complied within respect of all transfers of share and the registration thereof.

Article 20

The instruments of transfer duly stamped and executed by the transferor and the transferee shall be delivered to the Company in accordance with the provisions of the Act. The Instruments of transfer shall be accompanied by such evidence as the Board may require to prove the title of transfer and his right to transfer shall remain in custody of the Company until destroyed by order of the Board. The transfer of shares shall be deemed to be the holder of such shares until the name of the transferee shall have been entered in the Register of Members in respect thereof. Before the registration of such transfers, the respective share certificate must have been delivered to the Company.

Article 21

The Board shall have the power on giving not less than seven days previous notice by advertisement in some newspaper circulating in the district in which the office of the Company is situated to close the Transfer Books, the Register of member of Debenture-holders at such time or times and for such period, or periods not exceeding thirty days at a time and not exceeding in the aggregate forty five days in each year.

Article 22

Subject to the provisions of Section 111 of the Act, the Board may at its own absolute and uncontrolled discretion and without assigning any reason, decline to register of acknowledge any transfer of shares, whether fully paid or not, but in such cases it shall, whether fully paid or

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not, but in such cases it shall, within one month from the date on which the instrument was lodged with the Company send to the transferee and the transferor notice of the refusal to register such transfer provided that registration of a transfer shall not be refused on the ground of the transferor being, either alone or jointly with any other person or persons, indebted to the Company on any account whatsoever except where the Company has a lien on shares.

Article 23

Notwithstanding anything contained in these articles, the Board may in its absolute and uncontrolled discretion and without assigning any reasons, decline to register or acknowledge any transfer of shares. In particular and with out prejudice to the generality of the above powers, the Board may subject to the provision of section 111 of the Act, so decline to register under exceptional circumstances when it is felt that the transferee is not a desirable person from the larger point of the interest of the company as a whole.

Article 24

Where in the case of partly paid shares, an application for registration is made by the transferor, the Company shall give notice of the application to the transferee in accordance with the provisions of Section 110 of the Act.

Article 25

In case of death of any one or more of the persons named in the Register of Members as the joint holders of any share, the survivor or survivors shall be the only persons recognized by the Company as having any title or interest in such shares, but nothing herein contained shall be taken to release the estate of a deceased joint holder from any liability on share held by him jointly with any other person.

Article 26

The executors or administrators or holders of Successions Certificate or the legal representatives of deceased member (not being one of two or more joint holders), shall be the only persons recognized by the Company as having any title to the shares registered in the name of such members and the Company shall not be bound to recognize such executors of administrator or holders of a succession certificate or the legal representative unless such persons shall have first obtained Probate or letters of Administration or Succession Certificate as the case may be from a duly constituted Court in the Union of India provided that in any case where the Board in its absolute discretion think fit, the Board may dispense with production of probate or Letters of Administration or Succession Certificate upon such terms as to indemnity or otherwise as the Board in its absolute discretion may think necessary and register the name of any person who claims to be absolutely entitled to the shares standing in the name of a deceased member as a member.

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Article 27

No share shall in any circumstances be transferred to any insolvent or person of unsound mind.

Article 28

If any member of the Company dies, and the Company through any of its principal officers within the meaning of the Estate Duty Act, 1953 has knowledge of the death, it shall not be lawful for the Company to register the transfer of any share standing in the name of the deceased member unless the Company is satisfied that the transferred has acquired such shares for valuable consideration of there is produced to it a certificates from the controller of Estate Duty that either Estate Duty in respect thereof has been paid or will be paid or none is due as the case may be, Where the Company has come to know through any of its principal officers of the death of any member, the Company shall within three months of the receipt of such knowledge, furnish to the Assistant Controller or the Deputy Controller of the Estate Duty who is exercising the functions of the Income Tax Officer under the Income Act in relation to the Company, such particulars as may be prescribed by the Estate Duty Rules 1953.

Article 29

Subject to the provisions of the Act, any person becoming entitled to shares in consequences of the death, lunancy, bankruptcy or insolvency of any member or by any lawful means other than by transfer in accordance with these Articles, may with the consent of the Board (which it shall not be under any obligation to give) upon producing such evidence that he sustains the character in respect of which he proposes to act under this Article of such title as the Board thinks sufficient, either be registered himself as the holder of the shares or elect to have some person nominated by him and approved by the Board registered as such holder provided nevertheless that such person shall elect to have a nominee registered, he shall testify the election by executing in favour of his nominee, an instrument of transfer in accordance with the provisions herein contained and until he does so, he shall not be freed from any liability in respect of the shares.

Article 30

A person entitled to a share by transmission shall subject to the right of the Directors as provided under the Companies Act, 1956 to retain such dividends or moneys as hereinafter provided, be entitled to receive and may be given a discharge for, any dividends or other moneys payable in respect of the share.

Article 31

The Company shall incur no liability or responsibility whatsoever in consequences of its registering or giving effect to any transfer of shares made or purporting to be made by any apparent legal owner thereof (as shown or appearing in Register of Members) to the prejudice

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of persons having or claiming any equitable right, title or interest to or in the said shares, notwithstanding that the Company may have had notice of such equitable right, title or interest or notice prohibiting registration of such transfer and may have entered such notice or referred thereto in any book of the Company and the Company shall not be bound or required to regard or attend or give effect to any notice which may be given to it of any equitable right, title or interest or be under any liability whatsoever for refusing or neglecting to do so, though it may nevertheless be at liberty to regard and attend to any such notice and give effect thereto if the Board shall so think fit.

Article 32A

Nomination

Every shareholder or debenture holder of the Company, may at any time, nominate, in the prescribed manner, a person to whom his shares in, or debentures of the Company shall vest in the even of his death.

Article 32C

The Company shall cause to be kept at its registered office or at such other place as may be decided by the Board of Directors, the Register and Index of Members in accordance with Section 150 and 151 and other applicable provisions of the Companies Act, 1956 and the Depositories Act, 1996 with the details of shares held in physical and dematerialized form in any medial as may permitted by law including in any form of electronic media.

The Register and Index of Beneficial Owners maintained by a Depository under Section 11 of the Depositories Act, 1996 shall also deemed to be the Register and Index of Members for the purpose of the Companies Act, 1956 and any amendment or re-enactment thereof. The company shall have power to keep in any state or country outside India, a Register of Members for the residents in that state or country.

GENERAL MEETING

Article 33

Regulation 53(1) of Table ‘A’ shall not apply and the following provision shall apply instead thereof.

The Chairman may with the consent of any meeting at which a quorum is present adjourn the meeting from time to time and from place to place.

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Article 34

If within half an hour from the time appointed for the Meeting a quorum be not present, the Meeting if convened upon a requisition of shareholders, shall be dissolved, and in any other case, it shall stand adjourned and if at such adjourned meeting a quorum be not present within half an hour from the time appointed for the Meeting, those Members who are present and not being less than two persons shall be a quorum and may transact the business for which the meeting was called.

Article 35

A copy of every balance sheet (including the profit and loss account, the auditor’s report and every other document required by law to be annexed or attached to the balance sheet) shall atleast twenty one days before the meeting at which the same are to be laid before the members, be sent to the members of the Company, to every trustee for the holders of any debentures issued by the Company, whether such member or trustee is or is not entitled to have notices of general meetings of the Company sent to him, and to all persons other than such members and trustees being the person so entitled provided that the Board may, if deems fit, instead of sending the said documents as aforesaid, make copies of the said documents available for inspection at the Registered Office of the Company during working hours for a period of twenty one days before the date of the Meeting and send a statement containing the salient features of such documents in the form prescribed under section 219 of the Act to every member of the Company and to every trustee for the holders of any debentures issued by the Company not less than twenty one days before the date of Meeting. If the copies of the aforesaid documents are sent less than twenty one days before the date of the meeting, they shall notwithstanding that fact, be deemed to have been duty sent if it is so agreed by all the Members entitled to vote at the meeting.

BOARD OF DIRECTORS

Article 36

Until otherwise determined by the Company in General Meeting, the number of Directors shall not be less than three and more than eleven.

Article 36A

The Directors shall have power to appoint not more than third of the total number of Directors of the Company as permanent directors. Any Director so appointed shall not be liable to retire by rotation.

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Article 37

Regulation 66 of Table ‘A’ shall not apply and a Director shall not be required to hold any qualifications shares.

Article 38

Until otherwise determined by the Company in a general meeting the remuneration of every Director for his services shall be such sum not exceeding Rs. 1000/- for every meeting of the Board and of any committee thereof attended by him, as shall be fixed by the Board. No such remuneration for attending meeting of the Board or of any committee thereof shall be paid to managing Director or whole time Director.

Article 39

The Board may allow and pay to any Director for the purpose of attending a meeting such sum either as fixed allowance and/or actual as the Board may consider fair compensation for traveling, board and lodging and incidental and/or such actual out of pocket expenses incurred by such Director in addition to his fees, for attending such meetings to and from the place at which the meetings of the Board or committees thereof or General Meetings of the Company are held from time to time or any other places at which the Director executes his duties.

Article 40

If any Director is willing, he shall be called upon to perform extra services (which expression shall include work done by a Director as a member of any committee formed by the Directors or in relation to signing share certificates) or to make any exertion in going or residing out of the place of his usual residence or otherwise for any of the purposes of the Company. The Company may remunerate such a Director either by a fixed sum or otherwise as may be determined by the Director, and such remuneration may be, either in addition to or in substitution for his share in the remuneration provided above and in addition be also reimbursed for all the expenses incurred by him.

Article 41A

Subject to the provisions of the Act and within the overall limit prescribed under the Article for the number of Directors on the Board, the Board may appoint any senior executive of the Company as a Whole time Director of the Company for such period and upon such terms and conditions as the Board may decide. A senior executive so appointed shall be governed by the following provisions: a) He shall be liable to retire by rotation as provided in the Act but shall be eligible for reappointment. His reappointment as a Director shall not constitute a break in his appointment as Whole time Director.

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b) He shall be reckoned as Director for the purpose of determining and fixing the number of Directors to retire by rotation. c) He shall cease to be a Director of the Company on the happening of any event specified in Section 283 and 314(2) (c ) of the Act. He shall cease to be a director of the Company, if for any reason whatsoever, he ceases to hold the position of senior executive in the Company or ceases to in the employment of the Company. d) Subject to what is stated hereinabove he shall carry out and perform all such duties and responsibility as may from time to time be conferred upon or entrusted to him by Managing Director/s and /or the Board, shall exercise such powers and authorities subject to such restrictions and conditions and/ or stipulations as the Managing Director /s and /or the Board may from time to time determine. e) His remuneration shall be fixed by the Board and shall be subject to the approval of the Company in the General Meeting and of the Central Government as may be required under the provisions of the Act.

MANAGING DIRECTOR

Article 46 a) Subject to the provisions of the Act and of these Articles, the Board shall have power to appoint from time to time any of its members as a Managing Director or Managing Directors and/or Whole time director / Special Director like Technical Director, Financial Director etc. of the Company for a fixed term not exceeding five years at a time, and upon such terms and conditions as the Board thinks fit, and the Board may by resolution vest in such Managing Director of Managing Directors/Whole time Director(s), Technical director(s), financial Director(s), and Special Director(s) such of the powers hereby vested in the Board generally as it thinks fit, and such powers may be made exercisable for such period or periods and upon such conditions and subject to such restrictions as it may determine. The remuneration of such Directors may be by way of monthly remuneration and/or fee for each meeting and/or participation in profits, or by any or all of those modes or of any other mode not expressly prohibited by the Act. b) The Directors may whenever they appoint more than one Managing Director, designate one or more of them as “Joint Managing Director” or “Joint Managing Directors” or “Deputy Managing Directors” as the case may be. c) The appointment and payment of remuneration to the above Director shall be subject to approval of General Meeting and of the Central Government if the provisions of the Act so require.

POWER OF DIRECTORS

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Article 47

Subject to the provisions of the Act, the management of the business of the Company shall be vested in the Directors and the Director may exercise all such power and do all such acts and things as the Company is by the Memorandum of Association or otherwise authorised to exercise and do, and are not hereby or by the Statute or otherwise directed or required to be exercised or done by the Company in General Meeting, but subject nevertheless to the provisions of the Act and any other Act and of the Memorandum of Association and these Articles and to any regulations of the Act, from time to time, made by the Company in General Meeting provided that no such regulation shall invalidate any prior act of the Director which would have been valid if such regulation had not been made.

Article 48 a) Subject to the provision of Section 292 of the Act the Board may from time to time at its discretion by a resolution passed at a meeting of the Board accept deposits from members either in advance of call or otherwise and generally raise or borrow or secure the payment of any sum or sums of money for the purpose of he Company provided however where the moneys to be borrowed together with the moneys already borrowed (apart from temporary loan obtained from the Company’s bankers in the ordinary course of business), exceed the aggregate of the paid up capital of the company and its free reserves (not being reserves set apart for any specific purpose) the board shall not borrow such moneys without the consent of the Company in a General Meeting. b) Provided that monies paid in advance of calls shall not in respect thereof confer a right to dividend or to participate in the profits of the Company.

Article 49

Any Debenture, Debenture-stock or other securities may be issued at a discount, premium or otherwise and may be issued on condition that they shall be convertible into shares of any denomination, and with any privileges and conditions as to security, redemption, surrender, drawing allotment of shares and attending (but not voting) at General Meeting, appointment of Directors and otherwise, Debentures with the right to conversion into allotment of shares shall be issued only with consent of the Company in General Meeting accorded by a Special resolution.

INDEMNITY

Article 52

Regulation 99 of the Table ‘A’ shall not apply to the Company. Save and except so far as the provisions of these Articles are avoided by Section 201 of the Act, the Board of Directors,

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Managing Directors, Directors, Managers, Auditors, Secretary and other Officers or servants for the time being of the Company and the trustee (if any) for the time being acting in relation to any of the affairs of the Company and every one of them and every one of their heirs, executors and administrators shall be indemnified and secured harmless out of the assets and profits of the Company from and against all actions, costs, charges, losses, damages and expenses which they or any of them, or any of their executors or administrators shall or may incur or sustain by reason of any acts done, concurred in or omitted in or about the execution of their duty or supposed duty in their respective offices or trust, except (if any) as they shall incur or sustain through or by their own willful neglect respectively, and none of the acts, receipts neglects or defaults the other or others of them or for joining in any receipt for the sake of conformity for any bankers or other persons with whom any moneys or effect belonging to the Company shall or may belong or are deposited for safe custody or for the insufficiency or deficiency of any securities upon which any moneys or effects belonging to the Company shall be invested or for any other loss, misfortune or damage which may happen in the execution of their respective offices or trusts or in relation thereto except the same shall happen by or through their own willful neglect or default respectively.

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MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The following contracts (not being contracts entered in to in the ordinary course of business carried on by our Company or entered into more than two years before the date of this Draft Letter of Offer) which are or may be deemed material have been entered or are to be entered in to by our Company. These Contracts and also the documents for inspection referred to hereunder, may be inspected at the Registered Office of our Company situated at No. 8, 2nd Floor, Kamanwala Chambers, Opp Bombay Stores, Sir P M Road, Fort, Mumbai – 400 001, Maharashtra, India from 10.00 a.m. to 1.00 p.m., on Business Days, from the date of this Draft Letter of Offer until the date of closure of the Issue.

Material Contracts

1. Issue Agreement dated March 29, 2011 with MAPE Advisory Group Private Limited, appointing them as Lead Manager to the Issue.

2. Agreement dated March 11, 2011 with Integrated Enterprises (India) Limited, appointing them as Registrar to the Issue.

3. Tripartite Agreement dated April 27, 2010 between our Company, CDSL and Integrated Enterprises (India) Limited, Registrar to the Issue.

4. Tripartite Agreement dated April 16, 2010 between our Company, NSDL and Integrated Enterprises (India) Limited, Registrar to the Issue.

Documents for inspection

1. Certified copies of the Memorandum and Articles of Association of our Company.

2. Certificate of Incorporation dated March 12, 1987, January 12, 1992 and March 18, 2011

3. Copy of the resolution of the Board of Directors dated November 12, 2010 and copy of resolution of the Share Issue Committee dated March 30, 2011 approving the terms of this Issue.

4. Annual Reports of the Company for the financial years ending March 31, 2006, March 31, 2007, March 31, 2008, March 31, 2009, March 31, 2010 and audited financial statements for the half year ending September 30, 2010.

5. Joint report from DPH & Co. and Chaturvedi SK & Fellows, dated March 24, 2011, on the restated financial information, included in this Draft Letter of Offer.

6. Statement of Tax Benefits dated March 10, 2011 from the Statutory Auditors of our Company.

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7. Consents of the Directors, Statutory Auditors, Auditors to the Issue, Company Secretary and Compliance Officer, Lead Manager to the Issue, Legal Advisor to the Issue and Registrar to the Issue to include their names in the Draft Letter of Offer to act in their respective capacities.

8. Copy of the prospectus of the Initial Public Offering of our Company

9. Share Purchase Agreement dated July 19, 2009 for purchase of 17,87,700 Equity Shares of our Company by ICLFSL from the Erstwhile Promoters.

10. Marketing Agreement with India Cements dated July 14, 2010.

11. Due Diligence certificate dated March 30, 2011 to SEBI from the Lead Manager.

12. Copy of in-principle approval received from Bombay Stock Exchange Limited vide letter no. *●+ dated *●+.

13. Copy of SEBI Observation letter no. *●+ dated *●+ and compliance thereof.

Any of the contracts or documents mentioned in this Draft Letter of Offer may be amended or modified at any time if so required in the interest of our Company or if required by the other parties, without reference to the shareholders subject to compliance of the provisions contained in the Companies Act and other relevant statutes.

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DECLARATION

No statement made in this Draft Letter of Offer contravenes any of the provisions of the Companies Act, 1956 and the rules made there under. All the legal requirements connected with the Issue as also the guidelines, instructions etc. issued by SEBI, Government and any other competent authority in this behalf have been duly complied with.

We hereby certify that all the disclosures in this Draft Letter of Offer are true and correct.

Signed by the Directors of our Company

N Srinivasan B S Adityan

Sd/- Sd/-

Arun Datta R K Das

Sd/- Sd/-

N R Krishnan A Sankarakrishnan

Sd/- Sd/-

L Sabaretnam T S Raghupathy

Sd/- Sd/-

PL Subramanian R Srinivasan

Sd/- Sd/-

V M Mohan

Sd/-

Signed by the Manager

Karan Vashisht

Sd/- Place: Chennai

Date: March 30, 2011

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